**UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**Form
      10-K**





R
            **ANNUAL
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES **EXCHANGE
                ACT OF 1934******For
                the fiscal year ended December 31, 2007****or**o
            **TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





**Commission
      file number** **001-33916**





**ASIA
      SPECIAL SITUATION ACQUISITION CORP.**


*(Exact
      name of registrant as specified in its charter* *)*





**Cayman
                Islands**
            **Not
                Applicable***(State
                or other jurisdiction of*
            *(I.R.S.
                Employer**incorporation
                or organization)*
            *Identification
                No.)*





**c/o
      M & C Corporate Services Limited**


**P.O.
      Box 309GT, Ugland House**


**South
      Church Street**


**George
      Town, Grand Cayman**


**Cayman
      Islands**


*(Address
      of principal executive offices)*





**(407)
      805-0879**


( *Registrant’s
      telephone number, including area code* )





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




**Units,
                each consisting of
                one****Ordinary Share and one
                Warrant**
            
            **American
                Stock Exchange****Ordinary
                Shares, $.0001 par value
                per share**
            
            **American
                Stock
                Exchange****Ordinary
                Share Purchase
                Warrants**
            
            **American
                Stock
                Exchange***(Title
                of each
                class)*
            
            *(Name
                of each exchange on which
                registered)*


Securities
      registered pursuant to Section 12(g) of the Act: **None.**





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





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





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 o No
þ





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. o





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
      one):





Large
      accelerated filer o Accelerated filer o Non-accelerated filer R





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





As
      of
      March 20, 2008, the aggregate market value of the issued and outstanding
      ordinary shares held by non-affiliates of the registrant, based upon the closing
      price of the ordinary shares as quoted on the American Stock Exchange of $9.05
      was approximately $84,300,000 million.  For
      purposes of the above statement only, all directors, executive officers and
      10%
      shareholders are assumed to be affiliates. This determination of affiliate
      status is not necessarily a conclusive determination for any other
      purpose.





Number
      of
      ordinary shares issued and outstanding as of March 27, 2008 was
      14,000,000.





**DOCUMENTS
      INCORPORATED BY REFERENCE** -
      None ****







**ASIA
      SPECIAL SITUATION ACQUISITION CORP.**





**ANNUAL
      REPORT ON FORM 10-K**





**FOR
      THE FISCAL YEAR ENDED DECEMBER 31, 2007**





**INDEX********Page****PART
                I**Item
                1.
            Business
            1Item
                1A.
            Risk
                Factors
            21Item
                1B.
            Unresolved
                Staff Comments
            46Item
                2.
            Properties
            46Item
                3.
            Legal
                Proceedings
            46Item
                4.
            Submission
                of Matters to a Vote of Security Holders
            46**PART
                II**Item
                5.
            Market
                for Registrant’s Common Equity, Related Shareholder Matters and Issuer
                Purchases of Equity Securities
            47Item
                6.
            Selected
                Financial Data
            47Item
                7.
            Management’s
                Discussion and Analysis of Financial Condition and Results of
                Operation
            48Item
                7A.
            Quantitative
                and Qualitative Disclosures About Market Risk
            53Item
                8.
            Financial
                Statements and Supplementary Data
            54Item
                9.
            Changes
                in and Disagreements with Accountants on Accounting and Financial
                Disclosure
            67Item
                9A.
            Controls
                and Procedures
            67Item
                9B.
            Other
                Information
            68**PART
                III**Item
                10.
            Directors,
                Executive Officers, and Corporate Governance
            68Item
                11.
            Executive
                Compensation
            72Item
                12.
            Security
                Ownership of Certain Beneficial Owners and Management and Related
                Stockholder Matters
            72Item
                13.
            Certain
                Relationships and Related Transactions, and Director
                Independence
            75Item
                14.
            Principal
                Accounting Fees and Services
            79**PART
                IV**Item
                15.
            Exhibits
                and Financial Statement Schedules
            80Signatures
            82








**PART
      I**





**ITEM
      1. BUSINESS.**





**Introduction**





We
      were
      formed as a blank check company under Cayman Islands law on March 22, 2007.
      We
      were formed for the purpose of acquiring control of one or more unidentified
      operating businesses, through a capital stock exchange, asset acquisition,
      stock
      purchase, or other similar transaction, including obtaining a majority interest
      through contractual arrangements. We will only acquire a business or businesses
      that, upon completion of our initial business combination, will be our
      majority-owned subsidiaries and will be neither investment companies nor
      companies excluded from the definition of investment company by Sections 3(c)(1)
      or 3(c)(7) of the Investment Company Act of 1940. We intend to utilize cash
      derived from the proceeds of our offering, our capital stock, debt or a
      combination of cash, capital stock and debt, in effecting a business
      combination. We will not acquire a minority interest in any operating business.





To
      date,
      our efforts have been limited to organizational activities, activities related
      to our offering and
      acquisition efforts, including sourcing and identifying potential target
      acquisitions .
      We
      intend to identify prospective acquisitions that are either located in Asia,
      provide products or services to consumers located in Asia, or invest in Asia.
      Although not limited to any specific country in Asia, we intend to focus our
      initial efforts on acquiring control of an operating business or businesses
      in
      the leisure and hospitality or financial services industries that are either
      located in China, provide products or services to consumers in China, or invest
      in China.





Although
      we intend to initially focus our search on an operating business or businesses
      in the leisure and hospitality or financial services industries that is located
      in, provides products or services to consumers located in China, or invests
      in
      China, we will explore opportunities in other business sectors or regions in
      Asia if we feel that it is in the best interests of our company and
      shareholders. We will seek to acquire control of a business, which in the
      opinion of management, may provide our company and its shareholders with the
      most favorable growth potential, due to a variety of factors, including its
      financial condition and results of operations, experience and skill of incumbent
      management, value of the intellectual property owned by the business, its
      competitive position, the regulatory environment in which it operates, or other
      criteria determined by management.





There
      is
      no specific timeframe or monetary amount established by management which will
      cause us to abandon our initial focus of acquiring an operating business in
      the
      leisure and hospitality or financial services industries that is located in,
      provides products or services to consumers located in China, or invests in
      China, in favor of other industries or countries in Asia even if it may be
      outside of management’s expertise. During the early stages of searching for a
      suitable target business, we intend to pursue potential business combinations
      in
      the specific industries and area in Asia that are within our primary focus.
      If
      an acceptable transaction cannot be found in these industries in China during
      the first year of our search, management may expand its focus by seeking
      favorable business opportunities in other industries or areas in Asia, even
      if
      such may be outside of our expertise. However, management will not rule out
      pursuing an attractive business combination at any time during the search
      process, including industries or areas in Asia outside of our primary business
      focus, if management determines it is in the best interests of our company
      and
      shareholders. For a more detailed discussion of management’s process for
      searching for and selecting a target business, see “Effecting a business
      combination — Selection of a target business and structuring of a
      business combination” below.





We
      intend
      to acquire all or a controlling interest in the equity of such operating
      business or businesses. If our initial business combination involves a
      transaction in which we acquire less than a 100% interest in the target company,
      the value of that interest that we acquire will be equal to at least 80% of
      the
      balance in the trust account (excluding deferred underwriting discounts and
      commissions). In all instances, we would control the target company. The key
      factors that we will rely on in determining control would be our acquisition
      of
      at least 51% of the voting equity interests of the target company and/or control
      of the majority of any governing body of the target company through contractual
      arrangements or otherwise.





We
      believe that since Hong Kong and Macau have been ceded back to China in 1997
      and
      1999, respectively, the local markets have responded favorably to foreign
      investment and capital. Our management believes that the hospitality and leisure
      sectors have continued to grow, and western companies have made significant
      capital investments in the region’s hospitality market including higher profile
      projects such as Hong Kong Disneyland theme park and the investments in Macau
      by
      themed gaming companies in properties such as the Sands, Venetian, MGM and
      Wynn
      Casinos. We believe that the lowering of barriers to investment may be a
      contributing factor that has induced capital flows to the region.





Until
      recently, China domestic financial institutions enjoyed a virtual monopoly
      due
      to restrictions on market entry and scope of business. Until China became a
      member of the World Trade Organization in December 2001, foreign financial
      institutions as a whole have achieved only minimal market share in China’s
      banking, insurance, securities and fund management businesses. Since becoming
      a
      WTO member, China has issued a number of new regulations and detailed measures
      which translate these commitments into specific rules governing foreign
      participation in the financial markets.




1





We
      believe that there are a number of opportunities for acquiring operating
      businesses in China due to changes in the PRC’s political, economic and social
      policies affecting the PRC. We believe that there are several factors that
      make
      China a favorable environment for both business acquisitions and operations,
      including:





·
            prolonged
                economic expansion within China, including gross domestic product
                growth
                of approximately 9% on average over the last 25 years with growth
                of
                approximately 11.1% and 10.9% in the first and second quarters of
                2007
                (and expected growth above 10% for each of the third and fourth quarters),
                according to the China Statistical Yearbook 2006 (China Statistics
                Press,
                October 2006) and the People’s Bank of China (see “Bank of China Sees GDP
                Growth in 2007,”*Business
                Week*,
                June 29, 2007);





·
            a
                number of mature operating businesses that are being privatized and
                that
                may be available for purchase at reasonable
                prices;





·
            expansion
                of private sector wealth resulting in sustained growing discretionary
                income and consumer consumption due to the general economic expansion
                and
                attendant creation of jobs and economic opportunities, as well as
                the
                resulting development of financial
                services;





·
            development
                of new regulations and adoption of detailed measures by China since
                joining the WTO as a member in December 2001 pursuant to WTO commitments
                such as granting of equal rights to state- and private-owned enterprises,
                which have greatly expanded opportunities for foreign participation
                in
                financial markets (see “WTO Entry Boosts China’s Economy,”*China
                Daily*,
                November 18, 2002); and





·
            more
                favorable labor rates and low-cost manufacturing
                capabilities.




We
      further believe that similar opportunities for acquiring operating businesses
      exist in other Asian countries, including Australia and New Zealand (which
      are
      English speaking and welcome foreign investment and capital) and in Vietnam
      and
      Japan. While Japan has been a major trading partner with the United States
      for
      over 50 years and a principal supplier of electronics and other products, we
      believe that Vietnam is seeking to replicate the recent attraction of China
      as
      an investment source. According to the Vietnam Real Estate Primer published
      by
      JP Morgan in June 2007, “Having one of the most stable political systems and
      fastest growing economies in the world, Vietnam is continually attracting
      significant investment from foreign investors. The country is positioning itself
      to be Asia’s next rising star.”





However,
      despite what we believe is a favorable investment climate, there are a number
      of
      restrictions and limitations imposed by both central and local government
      agencies in the PRC that may impose significant barriers to our ability to
      consummate the acquisition of all or a controlling interest in the equity or
      assets of an operating business located in the PRC. These include:





·
            restrictions
                on foreign ownership of companies operating in what are considered
                “important industries,” including telecommunications, advertising, food
                production and heavy equipment;





·
            regulation
                on foreign exchange and currency
                conversion;





·
            regulation
                on distribution of dividends to foreign enterprises on profits earned
                by
                PRC operating companies;





·
            regulation
                of acquisitions of PRC companies by foreign invested enterprises,
                or FIEs,
                and the requirement of approvals by the PRC State Administration
                of
                Foreign Exchange, or SAFE, or the central Ministry of Commerce in
                Beijing;
                and





·
            restrictions
                on the acquisition by PRC residents of controlling interests in foreign
                special purpose companies formed for the purpose of investing in
                PRC
                operating companies.





***Contractual
      Arrangements***





We
      may
      attempt to acquire a majority interest in a business, or businesses, located
      in
      China or Vietnam, through a combination of acquiring at least 51% of the equity
      interests of the target company and control of the board of directors or other
      governing body of the target company or through contractual arrangements.
      However, there are uncertainties regarding whether obtaining a majority interest
      through contractual arrangements will comply with regulations prohibiting or
      restricting foreign ownership in certain industries. The PRC or Vietnam can
      restrict the foreign ownership of businesses that are determined from time
      to
      time to be in “important industries” that may affect the national economic
      security or those in the PRC having “famous Chinese brand names” or “well
      established Chinese brand names.” Additionally, the PRC may apply the above
      restrictions in other industries in the future.





Moreover,
      uncertainties are present because contractual arrangements are subject to the
      review requirements of the Ministry of Commerce and other relevant agencies
      as
      discussed elsewhere for acquisitions of assets and companies in the PRC and
      Vietnam. Subject to the various percentage ownership limitations that exist
      from
      time to time, acquisitions involving foreign investors and parties in the
      various restricted categories of assets and industries may nonetheless sometimes
      be consummated where we obtain control using contractual arrangements with
      approved Chinese or Vietnamese parties. To the extent that such agreements
      are
      employed, they may be for control of specific assets such as intellectual
      property or control of blocks of the equity ownership interests of a company.
      The agreements would be designed to provide our company with the economic
      benefits of and control over the subject assets or equity interests similar
      to
      the rights of full ownership, while leaving the technical ownership in the
      hands
      of Chinese or Vietnamese parties who are approved by the Chinese or Vietnamese
      regulators, as applicable, and who would likely be designated by our company.




2





For
      example, these contracts could result in a structure where, in exchange for
      our
      payment of the consideration (i) the operating company would continue to be
      totally or majority owned by Chinese or Vietnamese residents approved by the
      Chinese or Vietnamese regulators, as applicable, and not otherwise affiliated
      with us, and the target company would continue to hold the requisite licenses
      for its business, and (ii) we would establish a new wholly-owned or majority
      owned subsidiary in China or Vietnam, as applicable, which would provide
      technology, technical support, consulting and related services to the operating
      company in exchange for fees, which would transfer to us substantially all
      of
      the economic benefits of ownership of the operating company.





These
      contractual arrangements would be designed to provide the
      following:





·
            our
                exercise of effective control over the operating
                company;





·
            a
                substantial portion of the economic benefits of the operating company
                would be transferred to us; and





·
            we,
                or our designee, would have an exclusive option to purchase all or
                part of
                the equity interests in the operating company owned by the Chinese
                or
                Vietnamese residents who are approved by the Chinese or Vietnamese
                regulators, as applicable, and whom we designate, or all or part
                of the
                assets of the operating company, in each case when and to the extent
                permitted by Chinese or Vietnamese regulations, as
                applicable.





While
      we
      cannot predict the terms of any such contract that we will be able to negotiate,
      at a minimum, any contractual arrangement would need to provide us with (i)
      effective control over the operating company’s operations and management either
      directly through board control or through affirmative and/or negative covenants
      and veto rights with respect to matters such as entry into material agreements,
      management changes and issuance of debt or equity securities, among other
      potential control provisions and (ii) a sufficient level of economic interest
      to
      ensure that we satisfy the 80% threshold required for our initial business
      combination. We have not, however, established specific provisions which must
      be
      in an agreement in order to meet the definition of business combination. In
      the
      event that our board of directors does not believe that it is able to determine
      the fair market value of any contractual arrangement, we would obtain an
      independent appraisal from an independent investment bank or industry expert
      for
      the purpose of determining the fair market value of any contractual arrangement.





These
      agreements likely also would provide for increased ownership or full ownership
      and control by us when and if permitted under PRC or Vietnamese law and
      regulation. If we choose to effect a business combination that employs the
      use
      of these types of control arrangements, we may have difficulty in enforcing
      our
      rights. Therefore these contractual arrangements may not be as effective in
      providing us with the same economic benefits, accounting consolidation or
      control over a target business as would direct ownership through an asset
      acquisition or stock exchange. For example, if the target business or any other
      entity fails to perform its obligations under these contractual arrangements,
      we
      may have to incur substantial costs and expend substantial resources to enforce
      such arrangements, and rely on legal remedies under Chinese or Vietnamese law,
      as applicable, including seeking specific performance or injunctive relief,
      and
      claiming damages, which we cannot assure will be sufficient to off-set the
      cost
      of enforcement and may adversely affect the benefits we expect to receive from
      the business combination.





Moreover,
      we expect that the contractual arrangements upon which we would be relying
      would
      be governed by Chinese or Vietnamese law and would be the only basis of
      providing resolution of disputes which may arise through either arbitration
      or
      litigation in China or Vietnam, as applicable. Accordingly, these contracts
      would be interpreted in accordance with Chinese or Vietnamese law and any
      disputes would be resolved in accordance with Chinese or Vietnamese legal
      procedures. Uncertainties in the Chinese or Vietnamese legal system could limit
      our ability to enforce these contractual arrangements. In the event we are
      unable to enforce these contractual arrangements, we may not be able to exert
      the effective level of control over the target business.





We
      have
      not selected any target business and we are, therefore, unable to determine
      at
      this time what form an acquisition of a target business will take.





Similar
      governmental restrictions on foreign ownership of assets and business
      investments have been imposed or are being considered in certain other countries
      in Asia. Accordingly, there can be no assurance that governmental restrictions
      or regulations in the PRC and/or Vietnam or elsewhere in Asia will not impose
      insurmountable barriers to our ability to consummate the acquisition of all
      or a
      controlling interest in any operating company, including ones in the leisure
      and
      hospitality or financial services industries, that are either located in,
      provide products or services to or invest in China or Vietnam or elsewhere
      in
      Asia.




3





***Our
      Management Team***





Our
      management team, board of directors and board of advisors have experience in
      investments, financing, acquisitions and operations in four core sectors in
      Asia: (i) hospitality and leisure (including gaming), (ii) financial services,
      (iii) real property development, and (iv) sea and air transport. Although there
      is no direct nexus between management’s experience in the real property
      development and sea and air transport sectors in Asia and our initial focus
      on
      the hospitality and leisure and financial services sectors in Asia, we believe
      that our management’s and board of directors’ experience in the real property
      development and sea and air transport sectors is relevant if we determine to
      abandon our initial focus to explore opportunities in such other business
      sectors if we feel that it is in the best interests of our company and
      shareholders. As set forth above, we believe that there are opportunities in
      hospitality and leisure and in financial services in Asia and that we have
      a
      significant network of contacts to identify such targets. For example, Angela
      Ho, our chief executive officer and chairman, and her father Dr. Stanley Ho,
      have been associated with many Asian business interests. Through their ownership
      as the principal shareholder of Shun Tak Holdings Limited, a public company
      listed on the Hong Kong Stock Exchange, and its affiliates, including Melco
      International Development Limited and Sociedade de Turismo e Diversoes de Macau,
      Dr. Ho and members of his family are engaged in the ownership and operation
      of
      gaming casinos, hotels, shipping, real estate, banking, air transport and other
      tourism-related industries, primarily located in Hong Kong and Macau. According
      to Forbes Magazine, Dr. Ho was ranked 104th among the world’s richest people in
      2007, with an estimated net worth of $7.0 billion. Based on their existing
      relationships with Dr. Ho and his affiliates and their regular interactions
      and
      contacts with businesses located in Asia, and particularly in mainland China,
      Hong Kong and Macau, we believe that our Sponsor and members of our management
      are well positioned to access a number of potential acquisitions and business
      combinations in this area of the world. Although Dr. Ho is not an officer,
      director or advisor of our company and while we have no intention to negotiate
      with or acquire a company controlled by, or affiliated with, Dr. Ho, management
      and our Sponsor, including Angela Ho who is the daughter of Dr. Ho, and Andrew
      Tse, the former Chief Financial Officer of Shun Tak Holdings Limited, intend
      to
      utilize Dr. Ho’s extensive business contacts and experience in China and Asia as
      an additional resource in our search for potential acquisition targets in the
      leisure and hospitality and financial services industries. Management does
      not
      intend to rely exclusively on Dr. Ho’s business contacts and experience and we
      cannot be certain that such contacts will be as helpful as we anticipate.
      However, none of Angela Ho, Ho Capital Management LLC or any other member of
      our
      management has or will discuss any potential business combination opportunities
      with Dr. Ho or his associates until after completion of our offering. We also
      believe that we have the local knowledge and resources to effectively evaluate
      business targets and to manage local risks.





Although
      our officers and directors have a significant level of involvement in hedge
      funds, investment funds and/or companies doing business in China and Asia,
      we
      will not consider an acquisition of, or directly or indirectly acquire, any
      entity that is either a portfolio company of a hedge fund, investment fund,
      or
      an affiliate thereof, with which our management is directly or indirectly
      affiliated.





**Industry
      Sectors**





***Leisure
      and Hospitality***





Although
      not limited to any one sector within the leisure and hospitality industry,
      we
      intend to focus our acquisition strategy on target businesses in the following
      sectors of the leisure and hospitality industry that are located in the PRC
      or
      otherwise provide their products and services to consumers located in
      China:




**·**
            hotels;


**·**
            tourism;


**·**
            gaming
                and casinos;


**·**
            condo-hotels/fractional
                time-shares/destination clubs;


**·**
            cruise
                lines;


**·**
            golf
                resorts and spas; and


**·**
            related
                amenity or service businesses.





*Macau
      Gaming and Hospitality.* Macau
      is
      a Special Administrative Region of China and the only location in China that
      permits casino gaming. (See “On the Ground in China’s Gambling Capital,” *Daily
      Wealth* ,
      May 25,
      2007.) We believe that Macau is well positioned to be one of the largest gaming
      destinations in the world. According to data we have compiled from the *Direcção
      de Inspecção e Coordenação de Jogos* (Gaming
      Inspection and Coordination Bureau of the Macau government), the Nevada Gaming
      Control Board and the New Jersey Casino Control Commission, in 2005 and the
      nine
      months ended September 30, 2006, Macau generated approximately US$4.7 billion
      and US$4.9 billion of gaming revenue, respectively, compared to the US$5.9
      billion and US$4.8 billion of gaming revenue (excluding sports book and race
      book), respectively, generated on the Las Vegas Strip and exceeding the US$5.0
      billion and US$4.0 billion (excluding sports book and race book), respectively,
      generated in Atlantic City. The data further indicates that gaming revenue
      in
      Macau has increased at a five-year compounded annual growth rate, or CAGR,
      from
      2000 to 2005 of 23.0% compared to CAGRs of 4.9% and 3.1% for the Las Vegas
      Strip
      and Atlantic City (excluding sports book and race book). We believe that Macau
      benefits from its proximity to one of the world’s largest pools of existing and
      potential gaming patrons and is currently the only market in greater China,
      and
      one of only several in Asia, to offer legalized casino gaming.




4





In
      1961,
      Dr. Stanley Ho, along with his partners bid for Macau franchises. By bidding
      high and promising to promote tourism and to develop infrastructure, the
      partners won the public tender for Macau’s gaming monopoly. In 1961, the company
      was renamed to Sociedade de Turismo e Diversões de Macau, S.A.R.L. (STDM); now
      Sociedade de Jogos de Macau. The Ho monopoly ended in 2001, and the three gaming
      concessionaires in Macau are the Macau casino operator Sociedade de Jogos de
      Macau, the Galaxy Casino Company Limited and Las Vegas casino operator Wynn
      Resorts, Ltd.





One
      of
      the world’s largest gaming markets, Macau is located in a highly-populated
      region of the world. Evidenced by the recent opening of Macau gaming facilities
      by Steve Wynn and other Nevada-based casino and hotel operators, we believe
      that
      Macau is currently underserved by its regional gaming facilities. Assuming
      the
      continuation of increased wealth and individual disposable income in China,
      we
      believe that Macau will represent a favored tourist attraction for the
      approximately 1.0 billion people in Asia who live within a three-hour flight
      to
      Macau. According to the government-run Statistics and Census Service, tourism
      in
      Macau is expected to continue to grow as the Chinese government continues to
      implement its policy of liberalizing historical restrictions on travel and
      currency movements.





The
      hospitality industry can be subdivided into three major ownership/operator
      segments: asset owners, brand owners/operators and independent operators. We
      may
      explore acquisitions of target business(es) and/or asset(s), in which we may
      engage in activities of any or all of these owner/operator segments.





Asset
      owners own direct (or, more typically, through holding entities, indirect)
      interests in actual real estate and related assets. Asset owners are typically
      private equity firms, private or public real estate investment trusts or
      companies, and individual investors whose primary business is to own real estate
      assets in various segments of the hospitality industry.





Brand
      owners/operators are owners, managers and/or franchisors of hotel brands. They
      typically manage the assets themselves for a fee, or franchise the assets to
      independent operators. Occasionally, like asset owners, brand owners own actual
      interests in the real estate and related assets.





Independent
      operators typically combine the operations of both asset owners and brand
      owners/operators. They are companies that manage diverse assets under different
      brands, which they typically franchise. In some cases, they also own direct
      or
      indirect interests in actual real estate and related assets.





*The
      Hotel Industry in General*





Hotel
      assets can be generally subdivided into one of the categories listed below
      and
      may be owned on a stand-alone basis or as part of regional, national or
      international chains:





Luxury/Resort.
      Hotels that offer the highest quality services, combined with luxury amenities,
      such as concierge service, high quality restaurants and resort facilities.
      These
      facilities typically charge the highest room rates.





Full
      Service. Hotels that offer quality services combined with full service
      amenities, such as meeting facilities, food and beverage outlets, pool and
      exercise rooms and which often include spa or recreation facilities.





Limited
      Service. Hotels that have limited service combined with quality rooms but have
      minimal meeting facilities (if any), have limited food and beverage outlets;
      may
      have a pool and exercise facilities.





Extended
      Stay. Hotels that have limited services combined with larger rooms and suites
      with kitchens, limited meeting facilities (if any), typically serve breakfast
      only and may have a pool and exercise facilities. These hotels are designed
      for
      guests staying on average 3-4 nights or more and are mini-apartments.





Budget
      Hotels/Motels. Hotels that offer no services, combined with small rooms and
      very
      few facilities, such as food and beverage facilities, pools, exercise facilities
      or meeting rooms. These facilities typically charge the lowest room
      rates.




5





In
      addition to the segments set forth above, we will evaluate hybrid opportunities
      including: condo/hotel conversions, timeshare units and fractional destination
      clubs, either alone or in tandem with a hotel.





We
      believe that hotels are generally considered a hedge against inflation because
      room rates can be adjusted on a daily basis. In most other types of real estate
      asset classes, leases are typically fixed: 1 - 2 years in duration for
      residential, 3 - 5 years for office, and 5 - 20 years for
      retail. According to the Hotel Research Group & PKF Consulting’s 2005 U.S.
      Lodging Industry Report, revenue growth in 2005 is expected to exceed 7.2%,
      to
      an average of approximately $44,000 per available room, a volume approximately
      equal to that last achieved in the year 2000. Accordingly, we believe that the
      hospitality industry is an attractive industry in which to make an acquisition
      and operate a target business.





*Hospitality
      Amenities and Services*





For
      the
      same reason that we believe the hotel, leisure and hospitality sectors in Asia
      represent attractive acquisition opportunities, we also believe there are
      prospective attractive acquisitions in the various hospitality amenity and
      related services sectors in Asia. These include, but are not limited to, those
      involving golf facilities, health clubs, spas and casinos, management services,
      reservation services, maintenance services, security services, food and
      beverage-related services and hospitality-related technology services.





As
      with
      the hotel industry, we believe there are other sectors that are related to
      hospitality amenities and services that may offer us opportunities to acquire
      a
      target business. Over the last five years, spas and spa resorts have grown
      considerably. In a recent study released by the International Spa Association,
      the U.S. spa industry generated an estimated $11.2 billion in revenue in 2003,
      up from $5 billion in 1999. Resort hotel spas accounted for 41% of 2003 total
      revenue, approximately $4.5 billion. The timeshare industry has also experienced
      dramatic growth. Resort Timesharing Worldwide has reported that the
      international timeshare industry reached $9.4 billion in sales in 2002 (up
      from
      $3.2 billion in 1990) with over 5,400 resorts in more than 100 countries, a
      growth rate of approximately 12% annually.





*Government
      Regulation of the Hospitality Industry*





Following
      a business combination, we may be subject to certain federal, state and local
      regulations which require us to obtain and/or maintain various licenses and
      permits which must be periodically renewed and may be revoked or suspended.
      Occupancy licenses must be obtained prior to the opening of any hotel and may
      require renewal if there has been a major renovation. Liquor licenses are
      required for hotels to be able to serve alcoholic beverages and are generally
      renewable annually. In addition, depending on the type of hospitality industry
      business we acquire, we may also be subject to labor laws and regulations of
      the
      jurisdiction in which its properties operate such as minimum wage requirements,
      regulations relating to working conditions, laws restricting the employment
      of
      illegal aliens, protection of the disabled and the protection of persons from
      discrimination. If the target business that we acquire provides any restaurant
      services, we would be subject to certain federal, state and local health laws
      and regulations. We may also be subject to environmental regulations under
      federal, state and local laws with respect to any properties we ultimately
      acquire.





We
      may
      acquire control of a target business in an industry related to hospitality
      such
      as the gaming industry. The gaming industry is highly regulated, and we would
      need to maintain licenses and pay gaming taxes to conduct such operations.
      Casinos are subject to extensive regulation under the laws, rules and
      regulations of the jurisdiction where they are located. These laws, rules and
      regulations generally concern the responsibility, financial stability and
      character of the owners, managers, and persons with financial interests in
      the
      gaming operations. Violations of laws in one jurisdiction could result in
      disciplinary action in other jurisdictions.





***Financial
      Services***





Asia
      is
      currently experiencing rapid construction and infrastructure expansion, and
      we
      believe that there are substantial opportunities to acquire a business providing
      financial services to the Asian economy. We believe opportunities in the
      financial services industry in Asia include:





**·**
            asset
                management firms;


**·**
            banks;


**·**
            leasing
                and property finance companies;


**·**
            insurance
                companies and insurance agencies;
                and


**·**
            securities
                firms.





*Fund
      Management.* Foreign
      fund management companies have only recently begun to enter the Asian market
      due
      to prior restrictions on market entry and scope of business. We believe that
      the
      Asian investment fund market is relatively small by international standards
      and
      in relation to the trillions of dollars of bank deposits and securities in
      Asia.
      In the first round of Sino-foreign pairing up, most of the Asia-based companies
      are participants in these fund/securities joint ventures, while many of the
      foreign counterparts are subsidiaries of major foreign investment banks that
      base their operations in Hong Kong.




6





We
      believe that potential acquisition targets may favor us over some other
      potential purchasers of their businesses, venture capital funds, leveraged
      buyout funds, operating businesses and other entities and individuals, both
      foreign and domestic, for the following reasons:





**·**
            We
                believe that potential acquisition targets may favor us over venture
                capital funds, leveraged buyout funds and other private equity funds
                because most of these funds have a finite life, which generally requires
                the fund to effect a liquidity event, such as a sale, refinancing
                or
                public offering, for portfolio companies in order to return capital
                to
                investors. Our capital structure does not require us to effect a
                liquidity
                event at any particular time.





**·**
            We
                believe that potential acquisition targets may favor us over many
                large
                financial platforms, which may include, but are not limited to, banks,
                insurance companies or other holding companies, because we will not
                integrate the operations of our initial acquisition target into an
                existing environment and corporate culture with pre-existing methods
                of
                doing business, as is common with acquisitions by large financial
                platforms.





*Banking.* Under
      the terms of China’s World Trade Organization (WTO) accession in 2001, China
      continues to open up its banking sector, including the licensing of the first
      nine foreign-owned locally incorporated banks in December 2006, as reported
      by
      the China Banking Regulatory Commission (CBRC) (BEIJING, Dec. 24, 2006, Xinhua).
      According to the Hong Kong Trade Development Council, Hong Kong banks will
      enjoy
      an early entry advantage to mainland China for several reasons, including that
      Hong Kong is currently the second largest foreign bank group in the mainland,
      after Japan, and compared to mainland China banks, Hong Kong banks are more
      experienced in consumer lending, and possess local expertise. We therefore
      believe that Hong Kong banks are thus in an advantageous position to capture
      a
      significant share of the market.





*Insurance.* We
      believe that the fast growing China insurance market offers significant
      potential to foreign insurers because, according to a May 2007 report by
      PriceWaterhouseCoopers, market penetration by foreign companies in mainland
      China has been minimal to date. According to the Hong Kong Trade Development
      Council, Hong Kong is the area’s leading insurance center, and this will give
      Hong Kong an advantage as the mainland China insurance market is opened to
      foreign companies.





*Securities.* According
      to the Hong Kong Trade Development Council, the combined size of the Chinese
      mainland’s two stock markets is now comparable with that of Hong Kong, and they
      expect the market to continue to expand rapidly in coming years, as China would
      like its capital markets to perform important fund-raising functions for
      enterprises instead of depending entirely on bank credit. The Hong Kong Trade
      Development Council reports that foreign financial institutions can now invest
      in domestic brokerages and fund management companies due to removal of some
      restrictions on market entry.





Our
      strategy is to acquire control of middle market business(es) and/or asset(s)
      that may have certain of the following characteristics:





**·**
            Growth
                and/or development opportunities;





**·**
            Repositioning
                and/or rebranding opportunities;





**·**
            Select
                balance sheet turnaround situations;
                and/or





**·**
            Brand
                strength and expansion potential.





**Competitive
      Strengths**





We
      intend
      to leverage the industry experience of our executive officers, directors and
      our
      special advisory board by focusing our efforts on identifying a prospective
      target business in the leisure and hospitality or financial services industries
      that is located in Asia or provides products and services to or invest in the
      Asian market. We believe that companies involved in these industries represent
      attractive acquisition targets for a number of reasons, including, but not
      limited to, a favorable economic environment due to continued economic growth
      in
      Asia through at least 2010, as reported in a May 2007 PriceWaterhouseCoopers
      survey of 40 banks doing business in Asia and, potentially attractive valuations
      due to capital markets in Asia being less developed than in the United States.





We
      believe, based solely on our management’s collective business and regional
      experience, that there are numerous business opportunities in the Asian the
      leisure, hospitality and financial services industries because capital markets
      in many Asian countries are in general less developed than in the United States.
      However, neither we nor any of our agents, representatives or affiliates have
      conducted any research with respect to identifying the number and
      characteristics of the potential acquisition candidates within these industries
      or the likelihood or probability of success of any proposed business
      combination. Accordingly, we cannot assure you that we will be able to locate
      a
      target business in such industries or that we will be able to engage in a
      business combination with a target business on favorable terms.




7





We
      believe that we possess several competitive strengths to source, evaluate and
      execute business combinations in our target industries because of our
      management’s personal and professional contacts and expertise. We believe that
      the background, operating histories and experience of our management team,
      board
      of directors and advisory board have equipped us not only to provide access
      to a
      broad spectrum of acquisition opportunities but also to improve upon the
      operational and financial performance of our target business. Our management
      team, board of directors and advisory board intend to contribute:





***Regional
      Expertise*** — Members
      of our management team, board of directors and board of advisors have
      participated in acquisitions, operations and disposals of businesses in our
      target region and industry sectors. We believe that we have extensive experience
      in managing public companies with Asia-based operations. In addition, we believe
      that Asian rules and regulations and Asian business customs may be unique to
      the
      region and require specialized knowledge that we possess.





***Established
      Deal Sourcing Network*** — We
      believe management, the board of directors and advisory board’s current
      positions, experience in the target industries and network of industry contacts
      will assist in providing flow for a potential initial business acquisition.
      These contacts and sources include executives employed with, and consultants
      engaged by, public and private businesses in our target industries, investment
      bankers, attorneys, and accountants, among others, with knowledge of these
      industries. Members of our management have significant experience in dealing
      in
      Asia and the family of Angela Ho, our chief executive officer and chairman
      of
      the board, has extensive business operations in Asia, particularly in the hotel,
      casino and transportation industries, and have been operating successfully
      for
      the past 46 years. We also believe that such persons have unique political
      affiliations in the region which we believe enhance our
      opportunities.




***Innovation,
      Strategic Planning and Business Development Experience*** — In
      a highly competitive marketplace, management believes that businesses that
      consistently outperform their peers frequently attribute that success to their
      ability to serve their consumers in new and creative ways. At the executive
      level, the management team has participated in strategic planning and business
      development for the various companies with which the team has been involved.





***Financial
      Acumen, Corporate Finance and Transactional Expertise*** — We
      believe, given our management, board of directors and advisory board’s
      transactional experience and network of contacts within both the target
      industries and financial community, our team has the ability to identify,
      source, negotiate, structure, and close strategic investments of various types,
      including business combinations, “add-on” acquisitions, and other strategic
      arrangements.





**Government
      Regulations**





In
      connection with consummating a business combination in the PRC or Vietnam,
      in
      structuring any such transaction we may be required to comply with the
      government regulations discussed below.





***Regulation
      of Mergers and Acquisitions***





The
      PRC
      State Administration of Foreign Exchange, or SAFE, and the central Ministry
      of
      Commerce, or MOFCOM, each located in Beijing, are the two principal agencies
      in
      the PRC regulating foreign investment activities, including acquisitions of
      PRC
      operating companies. In 2003 Tentative Provisions on Acquisition of Domestic
      Enterprises by Foreign Investors were enacted by MOFCOM, SAFE and other PRC
      agencies and became effective on April 12, 2003. The 2003 Acquisition Provisions
      were updated in 2006.





As
      with
      the 2003 Acquisition Provisions, the 2006 Acquisition Provisions require Chinese
      regulatory approvals for mergers with or acquisitions of the equity ownership
      or
      assets of Chinese domestic companies. Additionally, the 2006 Acquisition
      Provisions deprive companies incorporated or controlled overseas that are
      established by Chinese domestic companies, enterprises or PRC natural persons
      and are merging with or acquiring Chinese domestic affiliated companies of
      the
      tax preferential treatments granted to foreign investment enterprises, or FIEs,
      that are totally owned by non-PRC residents and make direct investments in
      the
      PRC or acquisitions of all of the equity of or controlling interests in, PRC
      operating companies. The 2006 Acquisition Provisions also create new layers
      of
      Chinese regulatory approvals affecting offshore “special purpose companies” set
      up by Chinese domestic companies, enterprises or natural persons, and the
      in-bound investment made by such “special purpose companies”. The 2006
      Acquisition Provisions require that the parties to a merger or acquisition
      shall
      disclose to SAFE and MOFCOM the nature of the transaction, elaborate on whether
      the parties are affiliates; if there are two parties who belong to the same
      actual controlling party, the parties concerned must disclose the actual
      controlling party to the PRC approval authority and explain the purpose of
      the
      merger or acquisition and whether the price agreed conforms to fair market
      value.




8





With
      regard
      to the tax treatments granted to FIEs established by Chinese domestic companies,
      enterprises or natural persons by way of merger with or acquisition of Chinese
      domestic affiliated companies in the name of their companies duly incorporated
      or controlled overseas, the 2006 Acquisition Provisions explicitly state that
      such FIEs are not eligible for the preferential treatments granted by the PRC
      government to FIEs, unless such overseas companies subscribe to the capital
      increase of the target Chinese domestic companies or contribute additional
      capital to the post-acquisition Chinese domestic company and the amount of
      the
      capital subscribed or contributed accounts for 25% or more of the
      post-acquisition registered capital of the Chinese company.





The
      2006
      Acquisition Provisions require that if the merger or acquisition of a Chinese
      domestic company by foreign investors and their obtaining controlling rights
      (i)
      involves certain defined key industries, including those described below, (ii)
      has any factor that impacts or may impact the economic security of China, or
      (iii) leads to a shift of controlling rights over a Chinese domestic company
      that possesses “famous brands” or “traditional Chinese trade names”, then the
      parties concerned must file an application in respect of such transaction with
      MOFCOM. The 2006 Acquisition Provisions emphasize that mergers with or
      acquisitions of Chinese domestic companies by foreign investors must not result
      in a loss on the sale of state-owned assets and if the merger or acquisition
      involves such matters as the transfer of state-owned property rights in
      companies or management of state-owned equity rights in listed companies the
      relevant provisions regarding the administration of State-owned assets must
      be
      complied with (see below).





The
      PRC
      has had restricted or limited foreign ownership of certain kinds of assets
      and
      companies operating in certain industries, designated as “key industries.” The
      industry groups that are restricted are wide ranging, including certain aspects
      of telecommunications, advertising, food production, and heavy equipment
      manufacturers, for example. In addition there can be restrictions on the foreign
      ownership of businesses that are determined from time to time to be in
“important industries” that may affect the national economic security in the PRC
      and Vietnam, or having “famous brand names” or “well established brand names”.
      Subject to the review requirements of MOFCOM and other relevant agencies in
      the
      PRC for acquisitions of PRC assets and companies and subject to the various
      percentage ownership limitations that exist from time to time, acquisitions
      involving foreign investors and parties in the various restricted categories
      of
      assets and industries may nonetheless sometimes be consummated using contractual
      arrangements with permitted Chinese parties.




To
      the extent
      that such agreements are employed, they may be for control of specific assets
      such as intellectual property or control of blocks of the equity ownership
      interests of a company which may not be subject to the merger and acquisition
      regulations mentioned above since these types of arrangements typically do
      not
      involve a change of equity ownership in a PRC or Vietnamese operating company,
      injure a third party or affect the social public interest. The agreements would
      be designed to provide our company with the economic benefits of and control
      over the subject assets or equity interests similar to the rights of full
      ownership, while leaving the technical ownership in the hands of Chinese parties
      who would be our nominees and, therefore, may exempt the transaction from the
      merger and acquisition regulations, including the application process required
      thereunder. However, since there has been limited implementation guidance
      provided with respect to the merger and acquisition regulations, there can
      be no
      assurance that the relevant government agency would not apply them to a business
      combination effected through contractual arrangements. If such an agency
      determines that such an application should have been made consequences may
      include levying fines, revoking business and other licenses, requiring
      restructure of ownership or operations and requiring discontinuation of any
      portion of all of the acquired business. The agreements likely also would
      provide for increased ownership or full ownership and control by us when and
      if
      permitted under PRC laws and regulations.





Vietnam
      has recently sought to replicate the China model of privatizing certain
      industries and permitting foreign investment. However, substantially all of
      the
      Vietnam based companies of the size that we would be interested in pursuing
      for
      our company are majority owned by the Vietnamese government. Accordingly, any
      transaction we seek to consummate that involves a Vietnam operating company
      would require specific approval of the Vietnam Ministry of Finance located
      in
      Hanoi. Government agency regulations in Vietnam are evolving and are largely
      unpublished. Accordingly, our search for an operating business in Vietnam will
      involve significant interface with governmental officials. There is no assurance
      that existing or newly adopted restrictions and regulations in Vietnam will
      permit our company to effect a business combination with an operating company
      in
      that country.





***Regulation
      of Foreign Investments and Financings involving PRC Companies***





In
      the
      past few years, a number of companies located in the PRC and owned by PRC
      residents have become publicly traded on United States securities exchanges
      and
      raised capital through reverse mergers with United States organized or financed
      shell companies or special purpose companies. In such transactions, the PRC
      residents who originally owned the China based operating company customarily
      receive or retain ownership of a majority of the capital stock of the United
      States publicly traded corporation.




9




SAFE
      and
      the central Ministry of Commerce, or MOFCOM, in Beijing play an important role
      in transactions that provide international financing for Chinese companies
      because they must approve any reorganization of a Chinese company into an
      offshore holding company or “special purpose company”, as well as any
      acquisition by Chinese residents of any equity interest in that holding company.
      The 2006 Acquisition Provisions defined a “special purpose company” as “a
      foreign company directly or indirectly controlled by Chinese domestic companies
      or natural persons for the purpose of listing in an overseas market the equity
      interests in a Chinese domestic company actually held by them.”





A
      Chinese
      domestic company that is to set up overseas as a “special purpose company” (as
      defined below) must obtain approval from MOFCOM and disclose to MOFCOM certain
      information including the business plan with regard to the listing of the
      special purpose company in the overseas market and the appraisal report issued
      by a consultant with regard to the stock offering price for any future listing
      of the special purpose company on an overseas market. The overseas listing
      of
      the special purpose company is subject to the approval of CSRC. Additionally,
      the financing of the special purpose company from its overseas listing must
      be
      repatriated to China according to the repatriation plan filed with SAFE. The
      profits, dividends and foreign exchange income obtained as a result of capital
      variation, which are received by the Chinese domestic companies or natural
      persons from their special purpose companies, must be repatriated to China
      within six months from the day on which they are received.




Pursuant
      to recent regulations issued by SAFE, PRC residents are required to register
      with and receive approvals from SAFE in connection with offshore investment
      activities. SAFE has stated that the purpose of these regulations is to ensure
      the proper balance of foreign exchange and the standardization of the
      cross-border flow of funds.





On
      January 24, 2005, SAFE issued a regulation stating that SAFE approval is
      required for any sale or transfer by the PRC residents of a PRC company’s assets
      or equity interests to foreign entities in exchange for the equity interests
      or
      assets of the foreign entities. The regulation also states that, when
      registering with the foreign exchange authorities, a PRC company acquired by
      an
      offshore company must clarify whether the offshore company is controlled or
      owned by PRC residents and whether there is any share or asset link between
      or
      among the parties to the acquisition transaction.





On
      April
      8, 2005, SAFE issued another regulation further explaining and expanding upon
      the January regulation. The April regulation clarified that, where a PRC company
      is acquired by an offshore company in which PRC residents directly or indirectly
      hold shares, such PRC residents must (i) register with the local SAFE regarding
      their respective ownership interests in the offshore company, even if the
      transaction occurred prior to the January regulation, and (ii) file amendments
      to such registration concerning any material events of the offshore company,
      such as changes in share capital and share transfers. The April regulation
      also
      expanded the statutory definition of the term “foreign acquisition”, making the
      regulations applicable to any transaction that results in PRC residents directly
      or indirectly holding shares in the offshore company that has an ownership
      interest in a PRC company. The April regulation also provides that failure
      to
      comply with the registration procedures set forth therein may result in the
      imposition of restrictions on the PRC company’s foreign exchange activities and
      its ability to distribute profits to its offshore parent company.





On
      October 21, 2005, SAFE issued the Notice on Issues Relating to the
      Administration of Foreign Exchange in Fund-raising and Reverse Investment
      Activities of Domestic Residents Conducted via Offshore Special Purpose
      Companies, or Notice 75, which became effective as of November 1, 2005. Notice
      75 replaced the two rules issued by SAFE in January and April 2005 mentioned
      above.





According
      to Notice 75:





·
            prior
                to establishing or assuming control of an offshore company for the
                purpose
                of financing that offshore company with assets or equity interests
                in an
                onshore enterprise in the PRC, each PRC resident, whether a natural
                or
                legal person, must complete the overseas investment foreign exchange
                registration procedures with the relevant local SAFE
                branch;





·
            an
                amendment to the registration with the local SAFE branch is required
                to be
                filed by any PRC resident that directly or indirectly holds interests
                in
                that offshore company upon either (1) the injection of equity interests
                or
                assets of an onshore enterprise to the offshore company, or (2) the
                completion of any overseas fund raising by such offshore company;
                and





·
            an
                amendment to the registration with the local SAFE branch is also
                required
                to be filed by such PRC resident when there is any material change
                involving a change in the capital of the offshore company, such as
                (1) an
                increase or decrease in its capital, (2) a transfer or swap of shares,
                (3)
                a division, (4) a long term equity or debt investment, or (5) the
                creation
                of any security interests over the relevant assets located in
                China.





Under
      the
      relevant rules, failure to comply with the registration procedures set forth
      in
      Notice 75 may result in restrictions being imposed on the foreign exchange
      activities of the relevant onshore company, including the payment of dividends
      and other distributions to its offshore parent or affiliate and the capital
      inflow from the offshore entity, and may also subject relevant PRC residents
      to
      penalties under PRC foreign exchange administration regulations.




10





In
      June
      2007, SAFE adopted Implementation Notice 106, which amended certain of the
      provisions of Notice 75. Implementation Notice 106 expanded the definition
      of
      special purpose company to include one organized in a stock exchange transaction
      for the purpose of conducting off-shore financing. Although the final
      interpretation of Implementation Notice 106 has yet to be provided by SAFE,
      many
      legal authorities whose clients do business in China have construed
      Implementation Notice 106 as imposing a two or three year waiting period on
      international financing of Chinese operations through the use of a special
      purpose company, a wholly-owned foreign enterprise, or “WOFE” or joint venture.
      In addition, approval of the Ministry of Commerce may be an additional condition
      to completion of such transaction.





As
      a
      Cayman Islands company, and therefore a foreign entity, if we purchase the
      assets or equity interest of a PRC company owned by PRC residents, such PRC
      residents will be subject to the registration procedures described in the
      regulations as currently drafted. Moreover, PRC residents who are beneficial
      holders of our shares are required to register with SAFE in connection with
      their investment in us.





Accordingly,
      to the extent that our company seeks to effect a business combination with
      a
      Chinese-based company owned by PRC residents in a transaction whereby the
      purchase price includes a sufficient number of our ordinary shares that provides
      the PRC residents with control of a majority of our ordinary shares, such
      transaction may be subject to a lengthy waiting period under SAFE Implementation
      Notice 106 or Ministry of Commerce approval; in which event we would be unable
      to consummate such business combination before we are required to liquidate.
      Although we believe that such conditions and approvals are targeted to external
      financings for PRC companies and would not apply to an all cash purchase of
      a
      PRC company or to a transaction in which PRC residents own less than a majority
      of our ordinary shares after the business combination, there is no assurance
      that PRC regulatory authorities will not adopt other rules or regulations that
      would adversely affect our ability to consummate any business combination in
      the
      PRC.





In
      addition, as a result of the lack of implementing rules, other uncertainties
      concerning how the existing SAFE regulations will be interpreted or implemented,
      and uncertainty as to when the new regulations will take effect, we cannot
      predict how they will affect our business operations following a business
      combination. For example, our ability to conduct foreign exchange activities
      following a business combination, such as remittance of dividends and
      foreign-currency-denominated borrowings, may be subject to compliance with
      the
      SAFE registration requirements by such PRC residents, over whom we have no
      control. In addition, we cannot assure you that such PRC residents will be
      able
      to complete the necessary approval and registration procedures required by
      the
      SAFE regulations. We will require all our shareholders, following a business
      combination, who are PRC residents to comply with any SAFE registration
      requirements, although we have no control over either our shareholders or the
      outcome of such registration procedures. Such uncertainties may restrict our
      ability to implement our acquisition strategy and adversely affect our business
      and prospects following a business combination.





***Regulation
      of wholly-owned foreign enterprises (WOFE)***





Generally
      speaking, under the current Chinese legal regime regulating foreign direct
      investment in China, the following forms of FIEs are available to foreign
      investors:





·
            Sino-foreign
                equity joint ventures (“EJV”);





·
            Sino-foreign
                co-operative joint ventures (“CJV”);
                and





·
            Wholly
                owned foreign enterprises (“WOFE”).





A
      WOFE is
      a company with limited liability and legal person status. There are only foreign
      investors and no Chinese partners. Unlike an EJV or CJV, articles of association
      are sufficient to establish a WOFE, and there is no need to draw up a joint
      venture contract even if there are two or more foreign investors in the WOFE.
      Like an EJV or CJV, the articles of association must be approved by the Chinese
      government.





Foreign
      investors may prefer WOFEs to EJVs/CJVs because in the case of a WOFE (1) there
      is a straightforward management structure which is not dependent on the
      interests of a local partner; (2) it is easy to terminate compared to an EJV
      or
      CJV; and (3) intellectual property is usually better protected. Without a local
      partner, the foreign investor lacks local support and proper access to resources
      (such as connections with governmental authorities) and access to the markets
      of
      China’s unique economy.





While
      it
      is an issue under Chinese law whether WOFEs are allowed in certain Chinese
      industries, foreign investors are allowed to incorporate WOFEs in certain
      industries.




11





***Dividend
      distribution***





The
      principal laws and regulations in China governing distribution of dividends
      by
      foreign-invested companies include:





·
            The
                Sino-foreign Equity Joint Venture Law (1979), as
                amended;





·
            The
                Regulations for the Implementation of the Sino-foreign Equity Joint
                Venture Law (1983), as amended;





·
            The
                Sino-foreign Cooperative Enterprise Law (1988), as
                amended;





·
            The
                Detailed Rules for the Implementation of the Sino-foreign Cooperative
                Enterprise Law (1995), as amended;





·
            The
                Foreign Investment Enterprise Law (1986), as amended;
                and





·
            The
                Regulations of Implementation of the Foreign Investment Enterprise
                Law
                (1990), as amended.





Under
      these regulations, foreign-invested enterprises in China may pay dividends
      only
      out of their accumulated profits, if any, determined in accordance with Chinese
      accounting standards and regulations. In addition, wholly foreign-owned
      enterprises in China are required to set aside at least 10% of their respective
      accumulated profits each year, if any, to fund certain reserve funds unless
      such
      reserve funds have reached 50% of their respective registered capital. These
      reserves are not distributable as cash dividends.





***Government
      regulations relating to foreign exchange controls***





The
      principal regulation governing foreign exchange in China is the Foreign Currency
      Administration Rules (IPPS), as amended. Under these rules, the Renminbi,
      China’s currency, is freely convertible for trade and service related foreign
      exchange transactions, but not for direct investment, loan or investment in
      securities outside of China unless the prior governmental approval is obtained.
      Foreign-Invested Enterprises, or FIEs, are required to apply to the State
      Administration of Foreign Exchange, or SAFE, for “Foreign Exchange Registration
      Certificates for FIEs.” Following a business combination, we will likely be an
      FIE as a result of our ownership structure. With such registration certificates,
      which need to be renewed annually, FIEs are allowed to open foreign currency
      accounts including a “basic account” and “capital account.” Currency translation
      within the scope of the “basic account,” such as remittance of foreign
      currencies for payment of dividends, can be effected without requiring the
      approval of the SAFE. However, conversion of currency in the “capital account,”
including capital items such as direct investment, loans and securities, still
      require approval of the SAFE. This prior approval may delay or impair our
      ability to operate following a business combination.





***Government
      regulations relating to taxation***





According
      to the PRC income Tax Law of Foreign Investment Enterprises and Foreign
      Enterprises and the Implementation Rules for the Income Tax Law, the standard
      Enterprise Income Tax, or EIT, rate of FIEs is 33%, reduced or exempted in
      some
      cases under any applicable laws or regulations. Income such as dividends and
      profits derived from the PRC by a foreign enterprise which has no establishment
      in the PRC is subject to a 20% withholding tax, unless reduced or exempted
      by
      any applicable laws or regulations. The profit derived by a foreign investor
      from a FIE is currently exempted from EIT. However, if this exemption were
      to be
      removed in the future, we might be required to deduct certain amounts from
      dividends we may pay to our shareholders following a business combination to
      pay
      corporate withholding taxes.





***Regulation
      of Foreign Currency Exchange and Dividend Distribution Foreign Currency
      Exchange.***




Foreign
      currency exchange
      in China is governed by a series of regulations, including the Foreign Currency
      Administrative Rules (1996), as amended, and the Administrative Regulations
      Regarding Settlement, Sale and Payment of Foreign Exchange (1996), as amended.
      Under these regulations, the Renminbi is freely convertible for trade and
      service-related foreign exchange transactions, but not for direct investment,
      loans or investments in securities outside China without the prior approval
      of
      SAFE. Pursuant to the Administrative Regulations Regarding Settlement, Sale
      and
      Payment of Foreign Exchange, foreign-invested enterprises in China may purchase
      foreign exchange without the approval of SAFE for trade and service-related
      foreign exchange transactions by providing commercial documents evidencing
      these
      transactions. They may also retain foreign exchange, subject to a cap approved
      by SAFE, to satisfy foreign exchange liabilities or to pay dividends. However,
      the relevant Chinese government authorities may limit or eliminate the ability
      of foreign-invested enterprises to purchase and retain foreign currencies in
      the
      future. In addition, foreign exchange transactions for direct investment, loan
      and investment in securities outside China are still subject to limitations
      and
      require approvals from SAFE.





***Regulation
      on State-owned Property Rights***





The
      acquisition of a PRC state-owned company is subject to stringent governmental
      regulation. The governing legislation is the *Provisional
      Regulations on Using Foreign Investment to Reorganize State-owned Enterprises* promulgated
      by SAIC and SAFE on November 8, 2002, effective from January 1, 2003 and the *Provisional
      Measures on the Administration of the Transfer of State-Owned Property Rights
      in
      Enterprises* promulgated
      by the SASAC and the MOF on December 31, 2003, effective from February 1, 2004.




12




As
      a
      matter of principle, the transfer of state-owned property rights in enterprises
      must take place through a government approved “state-owned asset exchange”, and
      the value of the transferred property rights must be evaluated by those Chinese
      appraisal firms qualified to do “state-owned assets evaluation”. The final price
      must not be less than 90% of the appraisal price. Additionally, bidding/auction
      procedures are essential in the event that there is more than one potential
      transferee.





In
      the
      case of an acquisition by foreign investors of state-owned enterprises, the
      acquirer and the seller must make a resettlement plan to properly resettle
      the
      employees, and the resettlement plan must be approved by the Employees’
Representative Congress. The seller must pay all unpaid wages and social welfare
      payments from the existing assets of the target company to the employees.





**Effecting
      a business combination**





***General***





We
      are
      not presently engaged in, and we will not engage in, any substantive commercial
      business for an indefinite period of time following our offering. We intend
      to
      utilize cash derived from the proceeds of our offering and the sale of the
      insider warrants, our capital stock, debt or a combination of these in effecting
      a business combination. Although substantially all of the net proceeds of our
      offering and the sale of the insider warrants are intended to be generally
      applied toward effecting a business combination, the proceeds are not otherwise
      being designated for any more specific purposes. Accordingly, prospective
      investors have invested in us without an opportunity to evaluate the specific
      merits or risks of any one or more business combinations. A business combination
      may involve the acquisition of a company which does not need substantial
      additional capital but which desires to establish a public trading market for
      its shares, while avoiding what it may deem to be adverse consequences of
      undertaking a public offering itself. These include time delays, significant
      expense, loss of voting control and compliance with various federal and state
      securities laws. In the alternative, we may seek to consummate a business
      combination with a company that may be financially unstable or in its early
      stages of development or growth.





***We
      have not identified a target business***





To
      date,
      we have not selected any target business on which to concentrate our search
      for
      a business combination. However, we have commenced our acquisition
      efforts, including sourcing and identifying potential target
      acquisitions .
      Since
      we will only acquire a business or businesses that, upon completion of our
      initial business combination, will be our majority-owned subsidiaries and will
      be neither investment companies nor companies excluded from the definition
      of
      investment company by Sections 3(c)(1) or 3(c)(7) of the Investment Company
      Act
      of 1940, this may limit the scope of our investment opportunities.





***Sources
      of target businesses***





We
      anticipate target business candidates will be brought to our attention from
      various unaffiliated sources, including investment bankers, attorneys,
      accountants, venture capital funds, private equity funds, leveraged buyout
      funds, management buyout funds, brokers and consultants and other members of
      the
      financial community, who may present solicited or unsolicited proposals. We
      expect such sources to become aware that we are seeking a business combination
      candidate by a variety of means, such as publicly available information relating
      to our offering, public relations and marketing efforts, articles that may
      be
      published in industry trade papers discussing our intent on making acquisitions,
      and/or direct contact by management which commenced following the completion
      of
      our offering. Our initial shareholders, officers and directors as well as their
      affiliates may also bring to our attention target business candidates. While
      our
      officers and directors make no commitment as to the amount of time they will
      spend trying to identify or investigate potential target businesses, they
      believe that the various relationships they have developed over their careers
      together with their direct inquiry of their contacts will generate a number
      of
      potential target businesses that will warrant further investigation. While
      we do
      not presently anticipate engaging the services of professional firms that
      specialize in business acquisitions on any formal basis, we may engage these
      firms in the future, in which event we may pay a finder’s fee or other
      compensation. The terms of any such arrangements will be negotiated with such
      persons on arm’s length basis and disclosed to our shareholders in the proxy
      materials we provide in connection with any proposed business combination.
      In no
      event, however, will we pay any of our existing officers, directors, advisors
      or
      shareholders or any entity with which they are affiliated any finder’s fee or
      other compensation for services rendered to us prior to or in connection with
      the consummation of a business combination. We will not enter into any business
      combination with any affiliates of our Sponsor, initial shareholders, advisors,
      officers or directors. In addition, none of our officers, directors, advisors,
      or initial shareholders or our Sponsor, or any of their respective affiliates,
      will receive any finder’s fee, consulting fees or any similar fees or other
      compensation from any other person or entity in connection with any business
      combination other than any compensation or consulting fees which may be received
      for any services provided to the resulting business following such business
      combination, if requested by the target company and separately negotiated at
      arms-length between the parties. However, the payment of any such compensation
      or consulting fees for any services provided following the business combination
      will not be a criterion in the selection of an acquisition candidate. We do
      have
      a policy prohibiting the payment of such fees or reimbursements from the
      resulting business and as part of such policy, our officers, directors, initial
      shareholders and Sponsor have entered into a letter agreement which provides,
      among other things, that such persons or entities or their affiliates will
      not
      receive any finder’s fee, consulting fees or any similar fees or other
      compensation from the resulting business in connection with the business
      combination. Although we are not under any contractual obligation to engage
      any
      of the underwriters to provide any services for us after our offering, and
      have
      no present intent to do so, any of the underwriters may, among other things,
      introduce us to potential target businesses or assist us in raising additional
      capital, as needs may arise in the future. If any of the underwriters provide
      services to us after our offering, we may pay such underwriter fair and
      reasonable fees that would be determined at that time in arm’s length
      negotiations.




13





***Regulation***





Following
      a business combination, we may be subject to certain Chinese rules and
      regulations which require us to obtain and/or maintain various licenses and
      permits which must be periodically renewed and may be revoked or suspended.
      Occupancy licenses must be obtained prior to the opening of any hotel and may
      require renewal if there has been a major renovation. Liquor licenses are
      required for hotels to be able to serve alcoholic beverages and are generally
      renewable annually. In addition, if we acquire control of a hospitality industry
      business, we may also be subject to certain federal and state labor laws and
      regulations such as minimum wage requirements and regulations relating to
      working conditions. If the target business that we acquire provides any
      restaurant services, we would be subject to certain health laws and regulations.
      We may also be subject to environmental regulations with respect to any
      properties we may acquire.




We
      may acquire
      control of a target business in an industry related to hospitality such as
      the
      gaming industry. The gaming industry is highly regulated, and we would need
      to
      maintain licenses and pay gaming taxes to conduct such operations. Casinos
      are
      subject to extensive regulation under the laws, rules and regulations of the
      jurisdiction where they are located. These laws, rules and regulations generally
      concern the responsibility, financial stability and character of the owners,
      managers, and persons with financial interests in the gaming operations.
      Violations of laws in one jurisdiction could result in disciplinary action
      in
      other jurisdictions.





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





Subject
      to the requirement that our initial business combination must be with a target
      business with a fair market value that is at least 80% of the amount in our
      trust account (less deferred underwriting compensation of $3,450,000) at the
      time of such acquisition, our management will have virtually unrestricted
      flexibility in identifying and selecting a prospective target business. We
      intend to acquire all or a controlling interest in the equity of such operating
      business or businesses. If our initial business combination involves a
      transaction in which we acquire less than a 100% interest in the target company,
      the value of that interest that we acquire will be equal to at least 80% of
      the
      balance in the trust account (excluding deferred underwriting discounts and
      commissions). In all instances, we would control the target company. The key
      factors that we will rely on in determining control would be our acquisition
      of
      at least 51% of the voting equity interests of the target company and/or control
      of the majority of any governing body of the target company through contractual
      arrangements or otherwise. The fair market value of the target will be
      determined by our board of directors based upon one or more standards generally
      accepted by the financial community (examples of which may include actual and
      potential sales, earnings and cash flow and book value). If our board is not
      able to independently determine that the target business has a sufficient fair
      market value, or we enter into an agreement to acquire a business that is
      controlled by, or affiliated with, Dr. Ho, or in which he is an officer or
      director, we will obtain an opinion from an unaffiliated, independent FINRA
      registered investment banking firm with respect to the satisfaction of such
      criteria. Since any opinion, if obtained, would merely state that fair market
      value meets the 80% threshold, it is not anticipated that copies of such opinion
      would be distributed to our shareholders, although copies will be provided
      to
      shareholders upon request. If we do obtain the opinion of an investment banking
      firm, a summary of the opinion will be contained in the proxy statement that
      will be mailed to shareholders in connection with obtaining approval of the
      business combination, and the investment banking firm will consent to the
      inclusion of their report in our proxy statement. In addition, information
      about
      how shareholders will be able to obtain a copy of the opinion from us will
      be
      contained in the proxy statement. However, we do not anticipate that
      shareholders will be entitled to rely on any such opinion. If the independent
      investment banking firm takes the view that shareholders may not rely on the
      opinion, we will not consider such a view as a factor in deciding which
      investment banking firm to hire. We will not be required to obtain an opinion
      from an investment banking firm as to the fair market value if our board of
      directors independently determines that the target business complies with the
      80% threshold.





In
      addition, if more than 20% but not more than one share less than 35% of the
      shares owned by our public shareholders vote against a proposed business
      combination and exercise their redemption rights, we will still be required
      to
      utilize 80% of the amount in our trust account for the business combination.
      In
      the event that such redemption leaves us with an insufficient amount of funds
      to
      consummate a proposed business combination then, we may issue a significant
      amount of our debt or equity securities to the sellers of such businesses and/or
      seek to raise additional funds through a private offering of debt or equity
      securities. Since we have no specific business combination under consideration,
      we have not entered into any such fund raising arrangement and have no current
      intention of doing so (other than the 5,725,000 insider warrants for an
      aggregate of $5,725,000). This could limit our selection of a target business
      and/or the structure of the acquisition.




14





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





·
            growth
                potential;





·
            financial
                condition and results of operation;





·
            experience
                and skill of management;





·
            capital
                requirements;





·
            the
                value of the intellectual property owned by the
                business;





·
            competitive
                position;





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





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





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





·
            adaptability
                of products or services to new forms of
                communication;





·
            regulatory
                environment of the industry; and





·
            costs
                associated with effecting the business
                combination.





These
      criteria are not intended to be exhaustive. Any evaluation relating to the
      merits of a particular business combination will be based, to the extent
      relevant, on the above factors as well as other considerations deemed relevant
      by our management in effecting a business combination consistent with our
      business objective. In evaluating a prospective target business, we will conduct
      an extensive due diligence review which will encompass, among other things,
      meetings with incumbent management, where applicable, and inspection of
      facilities, as well as review of financial and other information which will
      be
      made available to us.





In
      seeking a business combination, we intend to utilize cash derived from the
      proceeds of our offering and the sale of the insider warrants, as well as our
      capital stock or debt, or a combination of cash, capital stock and debt, and
      there is no limit on the issuance of capital stock or incurrence of debt we
      may
      undertake in effecting a business combination. In the event a business
      combination is consummated, all sums remaining in the trust account will be
      released to us immediately thereafter, and there will be no restriction on
      our
      use of such funds.





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





The
      time
      and costs required to select and evaluate a target business and to structure
      and
      complete the business combination cannot presently be ascertained with any
      degree of certainty. Any costs incurred with respect to the identification
      and
      evaluation of a prospective target business with which a business combination
      is
      not ultimately completed will result in a loss to us and reduce the amount
      of
      capital available to otherwise complete a business combination. While we may
      pay
      fees or compensation to third parties for their efforts in introducing us to
      a
      potential target business, in no event, however, will we pay any of our existing
      officers, directors, advisors, or shareholders or any entity with which they
      are
      affiliated any finder’s fee or other compensation for services rendered to us
      prior to or in connection with the consummation of a business combination.
      In
      addition, none of our officers, directors, special advisors or initial
      shareholders will receive any finder’s fee, consulting fees or any similar fees
      from any other person or entity in connection with any business combination
      involving us other than any compensation or fees that may be received for any
      services provided following such business combination.





***Fair
      Market Value of Target Business***





The
      initial target business that we acquire must have a fair market value equal
      to
      at least 80% of the amount in our trust account (less deferred underwriting
      compensation of $3,450,000) at the time of such acquisition. There is no
      limitation on our ability to raise funds privately or through loans that would
      allow us to acquire a target business or businesses with a fair market value
      in
      an amount considerably greater than 80% of the amount in our trust account
      (less
      deferred underwriting compensation of $3,450,000) at the time of acquisition.
      We
      have not had any preliminary discussions, or made any agreements or
      arrangements, with respect to financing arrangements with any third party.
      The
      fair market value of such business will be determined by our board of directors
      based upon standards generally accepted by the financial community, such as
      actual and potential sales, earnings and cash flow and book value, and the
      price
      for which comparable businesses have recently been sold. If our board is not
      able to independently determine that the target business has a sufficient fair
      market value, or we enter into an agreement to acquire a business that is
      controlled by, or affiliated with, Dr. Ho, or in which he is an officer or
      director, we will obtain an opinion from an unaffiliated, independent FINRA
      registered investment banking firm which is a member of the Financial Industry
      Regulatory Authority with respect to the satisfaction of such criteria. Since
      any opinion, if obtained, would merely state that fair market value meets the
      80% of the amount in our trust account (less deferred underwriting compensation
      of $3,450,000) threshold, it is not anticipated that copies of such opinion
      would be distributed to our shareholders, although copies will be provided
      to
      shareholders who request it. If we do obtain the opinion of an investment
      banking firm, a summary of the opinion will be contained in the proxy statement
      that will be mailed to shareholders in connection with obtaining approval of
      the
      business combination, and the investment banking firm will consent to the
      inclusion of their report in our proxy statement. In addition, information
      about
      how shareholders will be able to obtain a copy of the opinion from us will
      be
      contained in the proxy statement. However, we do not anticipate that
      shareholders will be entitled to rely on any such opinion. If the independent
      investment banking firm takes the view that shareholders may not rely on the
      opinion, we will not consider such a view as a factor in deciding which
      investment banking firm to hire. We will not be required to obtain an opinion
      from an investment banking firm as to the fair market value of a proposed
      business combination if our board of directors independently determines that
      the
      target business has sufficient fair market value.




15





***Probable
      lack of business diversification***





While
      we
      may seek to effect business combinations with more than one target business,
      our
      initial business combination must be with a target business or target businesses
      which satisfy the minimum valuation standard at the time of such acquisition,
      as
      discussed above. Consequently, it is probable that we will have the ability
      to
      effect only a single business combination, although this may entail the
      simultaneous acquisition of several compatible operating businesses or assets.
      Unlike other entities which may have the resources to complete several business
      combinations of entities operating in multiple industries or multiple areas
      of a
      single industry, it is probable that we will not have the resources to diversify
      our operations or benefit from the possible spreading of risks or offsetting
      of
      losses. By consummating a business combination with only a limited number of
      entities, our lack of diversification may:





·
            leave
                us solely dependent upon the performance of a single business;
                and





·
            result
                in our dependency upon the development or market acceptance of a
                single or
                limited number of products or
                services.





Additionally,
      since our business combination may entail the simultaneous acquisitions of
      several assets or operating businesses at the same time and may be with
      different sellers, we will need to convince such sellers to agree that the
      purchase of their assets or closely related businesses is contingent upon the
      simultaneous closings of the other acquisitions.





***Limited
      ability to evaluate the target business’s management***





We
      anticipate that all or some of our management and key personnel will not remain
      associated in any capacity with the combined company following a business
      combination and that some or all of the management of the target business at
      the
      time of the business combination will remain in place. Moreover, our current
      management will only be able to remain with the combined company, if at all,
      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
      control of a target business in an all-cash transaction, it would be more likely
      that current members of management would remain with us as a director, or in
      senior management or advisory positions if they chose to do so. If a business
      combination were structured as a merger whereby the shareholders 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. Although
      we intend to closely scrutinize such individuals, we cannot assure you that
      our
      assessment will prove to be correct. In addition, we cannot assure you that
      new
      members that join our management following a business combination will have
      the
      necessary skills, qualifications or abilities to help manage a public
      company.





***Opportunity
      for shareholder approval of business combination***





Prior
      to
      the completion of a business combination, we will submit the transaction to
      our
      shareholders for approval, even if the nature of the acquisition is such as
      would not ordinarily require shareholder approval under applicable Cayman
      Islands’ Law. In connection with seeking shareholder approval of a business
      combination, we will furnish our shareholders with proxy solicitation materials
      prepared in accordance with the Securities Exchange Act of 1934, which, among
      other matters, will include a description of the operations of the target
      business and certain required financial information regarding the business.





In
      connection with the vote required for any business combination, all of our
      initial shareholders, including all of our officers and directors, have agreed
      to vote their respective ordinary shares owned by them immediately prior to
      our
      offering in accordance with the majority of the ordinary shares voted by the
      public shareholders. Initial shareholders who purchase ordinary shares in
      connection with, in our offering or after our offering have agreed to vote
      such
      shares in favor of any proposed business combination. We will proceed with
      the
      business combination only if: (i) a majority of the ordinary shares cast at
      the
      meeting are voted in favor of the business combination, (ii) public shareholders
      owning up to one share less than 35% of the shares sold in our offering exercise
      their redemption rights, each in accordance with the instructions set forth
      in
      the proxy materials to be mailed to our shareholders (as further discussed
      below), and (iii) a majority of our outstanding ordinary shares are voted in
      favor of an amendment to our amended and restated memorandum and articles of
      association to permit our perpetual existence; provided, however, that as part
      of the negotiations toward a business combination, our board of directors may,
      in the exercise of its business judgment, agree to a redemption rights exercise
      percentage that is less than one share below 35%. This would be done in order
      to
      preserve cash in the trust account in order to facilitate a particular business
      combination, and may result in us having a redemption rate lower than 35% as
      part of the agreement to consummate such a business combination. Voting against
      the business combination alone will not result in redemption of a shareholder’s
      shares into a pro rata share of the trust account. Such shareholder must have
      also exercised its redemption rights described below.




16





***Redemption
      rights***





In
      connection with a shareholder vote with respect to our initial business
      combination, an eligible shareholder may request redemption at any time after
      the mailing to our shareholders of the proxy statement and prior to the vote
      taken with respect to a proposed business combination at a meeting held for
      that
      purpose, but the request will not be granted unless the shareholder votes
      against the business combination and the business combination is approved and
      completed. Additionally, we may require public shareholders, whether they are
      a
      record holder or hold their shares in “street name,” to either tender their
      ordinary share certificates to our transfer agent at any time through the vote
      on the business combination or to deliver their shares to the transfer agent
      electronically using Depository Trust Company’s DWAC (Deposit/Withdrawal At
      Custodian) System, at the holder’s option. In connection with a shareholder vote
      with respect to our initial business combination, the proxy solicitation
      materials that we will furnish to shareholders in connection with the vote
      for
      any proposed business combination will indicate whether we are requiring
      shareholders to satisfy such certification and delivery requirements.
      Accordingly, a shareholder would have from the time we send out our proxy
      statement through the vote on the business combination to tender his or its
      shares if such shareholder wishes to seek to exercise their redemption rights,
      a
      period that will not be less than 10 days. This time period is expected to
      vary
      depending on the specific facts of each transaction. However, as the delivery
      process can be accomplished by the shareholder, whether or not he or it is
      a
      record holder or his or its shares are held in “street name,” in a matter of
      hours (because the transfer is made electronically once final instruction is
      given to Depository Trust Company) by simply contacting the transfer agent
      or
      his or its broker and requesting delivery of his or its shares through the
      DWAC
      System, we believe this time period is sufficient for an average investor.
      However, because we do not have any control over this process, it may take
      significantly longer than we anticipated. Additionally, if the ordinary shares
      cannot be transferred through the DWAC system, the process may take such number
      of days required to complete the proper paperwork, obtain the necessary
      authorizations and consents and to locate and deliver physical stock
      certificates, if any.





Traditionally,
      in order to perfect redemption rights in connection with a blank check company’s
      business combination, a shareholder could simply vote against a proposed
      business combination and check a box on the proxy card indicating such
      shareholder was seeking to redeem. After the business combination was approved,
      we would contact such shareholder to arrange for him or it to deliver his or
      its
      certificate to verify ownership. As a result, the shareholder then had an
“option window” after the consummation of the business combination during which
      he or it could monitor the price of the stock in the market. If the price rose
      above the redemption price, the shareholder could sell his or its shares in
      the
      open market before actually delivering his or its shares to the company for
      cancellation. Thus, the redemption right, to which shareholders were aware
      they
      needed to commit before the shareholder meeting, would become a right of
      redemption surviving past the consummation of the business combination and
      which
      we would be obligated to honor until the redeeming shareholder delivered the
      share certificate. The requirement for physical or electronic delivery prior
      to
      the meeting ensures that a redeeming shareholder’s election to redeem is
      irrevocable once the business combination is approved. There is a nominal cost
      associated with the above-referenced tendering process and the act of
      certificating the shares or delivering them through the DWAC system. The
      transfer agent will typically charge the tendering broker $35 and it would
      be up
      to the broker whether or not to pass this cost on to the redeeming shareholder.
      This fee would be incurred regardless of whether or not we require shareholders
      seeking to exercise redemption rights to tender their shares prior to the
      meeting. The need to deliver shares is a requirement of redemption regardless
      of
      the timing of when such delivery must be effectuated. Accordingly, this would
      not result in any increased cost to shareholders when compared to the
      traditional process; however, in the event a shareholder elects redemption
      of
      their shares but the proposed business combination is not approved, a
      shareholder will have paid $35 to elect conversion but would not actually have
      their shares redeemed. Further, it is possible this tendering process will
      be
      cost-prohibitive for shareholders in the event their aggregate holdings of
      our
      ordinary shares do not exceed $35.





Any
      request for redemption, once made, may be withdrawn at any time up to the date
      of the meeting. Furthermore, if a shareholder delivered his or its certificate
      for redemption and subsequently decided prior to the meeting not to elect
      redemption, such shareholder may simply request that the transfer agent return
      the certificate (physically or electronically). It is anticipated that the
      funds
      to be distributed to shareholders entitled to redeem their shares who elect
      redemption will be distributed promptly after completion of a business
      combination. Public shareholders who redeem their shares into their share of
      the
      trust account still have the right to exercise any warrants they still hold.




17





If
      a vote
      on our initial business combination is held and the business combination is
      not
      approved, we may continue to try to consummate a business combination with
      a
      different target until 18 months after completion of our offering (or within
      24
      months after the completion of our offering if a letter of intent, agreement
      in
      principle or definitive agreement has been executed within 18 months after
      completion of our offering and the business combination related thereto has
      not
      been completed within such 18-month period). If the initial business combination
      is not approved or completed for any reason, then public shareholders voting
      against our initial business combination who exercised their redemption rights
      would not be entitled to redeem their ordinary shares into a pro rata share
      of
      the aggregate amount then on deposit in the trust account. In such case, if
      we
      have required public shareholders to tender their certificates prior to the
      meeting, we will promptly return such certificates to the tendering public
      shareholder without any further action on the part of such shareholder. Public
      shareholders would be entitled to receive their pro rata share of the aggregate
      amount on deposit in the trust account only in the event that the initial
      business combination they voted against was duly approved and subsequently
      completed, or in connection with our liquidation.




The
      actual
      per-share redemption price will be equal to $10.00. Interest will be payable
      to
      public shareholders redeeming in connection with a business combination, pro
      rata, net of amounts previously released to us and taxes payable. An eligible
      shareholder may request redemption at any time after the mailing to our
      shareholders of the proxy statement and prior to the vote taken with respect
      to
      a proposed business combination at a meeting held for that purpose, but the
      request will not be granted unless the shareholder votes against the business
      combination and the business combination is approved and completed. Any request
      for redemption, once made, may be withdrawn at any time up to the date of the
      meeting. It is anticipated that the funds to be distributed to shareholders
      entitled to redeem their shares who elect redemption will be distributed
      promptly after completion of a business combination. Public shareholders who
      redeem their stock into their share of the trust account still have the right
      to
      exercise the warrants that they received as part of the units. We will not
      complete any business combination if public shareholders, owning more than
      35%
      of the shares sold in our offering, exercise their redemption rights; provided,
      however, that as part of the negotiations toward a business combination, our
      board of directors may, in the exercise of their business judgment, agree to
      a
      redemption right exercise percentage that is less than one share below 35%.
      This
      one share less than 35% redemption requirement which we have established is
      different than that of a traditional blank check offering, which generally
      will
      proceed with an acquisition of a target business if both shareholders owning
      a
      majority of the outstanding shares vote in favor of the business combination
      and
      no more than 20% of the public shareholders exercise their redemption rights.
      We
      have increased the redemption percentage from 20% to one share less than 35%
      in
      order to reduce the likelihood that a small group of investors holding a block
      of our stock will be able to stop us from completing a business combination
      that
      may otherwise approved by a large majority of our public shareholders.
      Accordingly, the one share less than 35% redemption requirement which we have
      established is a lower threshold and will make it easier for us to proceed
      with
      a proposed business combination than what is customary in a traditional blank
      check offering. Even if one share less than 35% or less of the shareholders,
      as
      described above, exercise their redemption rights, we may be unable to
      consummate a business combination if such redemption leaves us with funds less
      than a fair market value equal to at least 80% of the amount in our trust
      account (excluding any funds held for the benefit of any of the underwriters)
      at
      the time of such acquisition, which amount is required for our initial business
      combination. In the event that such redemption leaves us with an insufficient
      amount of funds to consummate a proposed business combination then, we may
      be
      forced to either find additional financing to consummate such business
      combination, consummate a different business combination or dissolve, liquidate
      and wind up.





Investors
      who choose to remain as shareholders and do not exercise their redemption rights
      will have assumed the entire cost of the offering, including the underwriters’
discount (but not including the deferred compensation owed to the underwriters).





***Automatic
      dissolution and liquidation if no business combination***





If
      we do
      not complete a business combination within 18 months after the consummation
      of
      our offering, or within 24 months if the extension criteria described below
      have
      been satisfied, we will dissolve and promptly return and liquidate all funds
      from our trust account only to our public shareholders as part of our
      dissolution and liquidation in proportion to their respective equity interests,
      an aggregate sum equal to the amount in the trust account, inclusive of any
      interest not previously released to us less the amount of taxes paid, if any,
      on
      interest earned.





Section
      172 of our amended and restated memorandum and articles of association provides
      that we will continue in existence only until eighteen months from the
      consummation of our offering or until twenty-four months if a letter of intent,
      an agreement in principle, or a definitive agreement to complete a business
      combination has been entered into, except if holders of 95% or more of our
      outstanding ordinary shares approve an extension of such time period. If we
      have
      not completed a business combination by such date, our corporate existence
      will
      cease except for the purposes of winding up our affairs and liquidating. At
      this
      time, we will become subject to a voluntary liquidation procedure under the
      Companies Law (2007 Revision) of the Cayman Islands (the “Companies Law”). Our
      liquidator would give at least 21 days’ notice to creditors of his intention to
      make a distribution by notifying known creditors (if any) who have not submitted
      claims and by placing a public advertisement in the Cayman Islands Official
      Gazette, although in practice this notice requirement need not necessarily
      delay
      the distribution of assets if the liquidator is satisfied that no creditors
      would be adversely affected as a consequence of a distribution before this
      time
      period has expired. We anticipate the trust account should be liquidated shortly
      following expiration of the 21 day period. As soon as the affairs of the company
      are fully wound-up, the liquidator must lay his final report and accounts before
      a final general meeting which must be called by a public notice at least one
      month before it takes place. After the final meeting, the liquidator must make
      a
      return to the registrar confirming the date on which the meeting was held and
      three months after the date of such filing the company is dissolved.




18




Pursuant
      to
      the terms of our amended and restated memorandum and articles of association,
      our powers following the expiration of the permitted time periods for
      consummating a business combination will automatically thereafter be limited
      to
      acts and activities relating to dissolving and winding up our affairs, including
      liquidation. The funds held in our trust account may not be distributed except
      upon our dissolution, and the funds held in our trust account will not be
      released until then. Our shareholders have voted by shareholder resolution,
      as
      permitted under the Companies Law (2007 Revision) of the Cayman Islands (the
      “Companies Law”), to amend Section 169 of our amended and restated memorandum
      and articles of association to provide that certain provisions of our articles
      may not be amended prior to our consummation of a business combination without
      the prior written consent of at least 95% of our outstanding ordinary shares,
      including our requirements (i) to seek shareholder approval of such a business
      combination (Section 170), (ii) to allow our shareholders to seek redemption
      of
      their shares if they do not approve of such a business combination (Section
      171), (iii) that we will continue in existence only until eighteen months from
      the consummation of our offering or until twenty-four months if a letter of
      intent, an agreement in principle, or a definitive agreement to complete a
      business combination has been entered into, except if holders of 95% or more
      of
      our outstanding ordinary shares approve an extension of such time period
      (Section 172), (iv) to provide distributions from the trust account to public
      shareholders only in the event of redemptions or our liquidation (Section 173),
      and (v) election, classification and removal of our directors (Section 174).
      While these rights and protections have been established for the purchasers
      of
      units in our offering, it is nevertheless possible that the prohibition against
      amending or modifying these rights and protections at any time prior to the
      consummation of the business combination could be challenged as unenforceable
      under Cayman Islands law, although, pursuant to the underwriting agreement
      we
      are prohibited from amending or modifying these rights and protections at any
      time prior to the consummation of the business combination without the
      affirmative vote of at least 95% of our outstanding ordinary shares. We have
      not
      sought an unqualified opinion regarding the enforceability of the prohibition
      on
      amendment or modification of such provisions without the affirmative vote of
      at
      least 95% of our outstanding ordinary shares because we view these provisions
      as
      fundamental and contractual terms of our offering. We believe these provisions
      to be obligations of our company to its shareholders and that investors will
      make an investment in our company relying, at least in part, on the
      enforceability of the rights and obligations set forth in these provisions
      including, without limitation, the prohibition on any amendment or modification
      of such provisions without the affirmative vote of at least 95% of our
      outstanding ordinary shares. Although Section 169 makes it difficult for us
      to
      amend such provisions in our amended and restated memorandum and articles of
      association, they are intended to protect our shareholders by requiring a
      supermajority of our shareholders to vote in favor of such a change in order
      for
      it to become effective.





In
      effecting our dissolution and liquidation, we will liquidate our trust account
      to our public shareholders. Concurrently, we shall pay, or reserve for payment,
      from interest released to us from the trust account if available, our
      liabilities and obligations. Our initial shareholders have waived their rights
      to participate in any liquidation of our trust account or other assets with
      respect to ordinary shares owned by them prior to our offering (including any
      insider warrants or shares they or their designees have acquired). In addition,
      the underwriters have agreed to waive their rights to the $3,450,000 of deferred
      underwriting compensation deposited in the trust account for their benefit.
      There will be no liquidation amounts in connection with a dissolution with
      respect to our warrants, which will expire worthless.





If
      we are
      unable to consummate a business combination and expend all of the net proceeds
      of our offering and the sale of the insider warrants, other than the proceeds
      deposited in the trust account, and without taking into account interest, if
      any, earned on the trust account, the initial per-share liquidation price to
      holders of the 11,500,000 shares entitled to participate in the liquidation
      of
      our trust account would be equal to the $10.00 per unit offering price plus
      interest net of taxes. The proceeds deposited in the trust account could,
      however, become subject to the claims of our creditors which could be prior
      to
      the claims of our public shareholders.





Although
      we will seek to have all vendors, prospective target businesses or other
      entities we engage execute agreements with us waiving any right, title, interest
      or claim of any kind in or to any monies held in the trust account for the
      benefit of our public shareholders, there is no guarantee that they will execute
      such agreements or even if they execute such agreements that they would be
      prevented from bringing claims against the trust account including but not
      limited to fraudulent inducement, breach of fiduciary responsibility or other
      similar claims, as well as claims challenging the enforceability of the waiver,
      in each case in order to gain an advantage with a claim against our assets,
      including the funds held in the trust account. If any third party refused to
      execute an agreement waiving such claims to the monies held in the trust
      account, we would perform an analysis of the alternatives available to us if
      we
      chose not to engage such third party and evaluate if such engagement would
      be in
      the best interest of our shareholders if such third party refused to waive
      such
      claims.




19





Examples
      of possible instances where we may engage a third party that refused to execute
      a waiver include the engagement of a third party consultant whose particular
      expertise or skills are believed by management to be significantly superior
      to
      those of other consultants that would agree to execute a waiver or in cases
      where management is unable to find a provider of required services willing
      to
      provide the waiver.





Ho
      Capital Management LLC, our Sponsor, Noble Investment Fund Limited and Allius
      Ltd. have agreed to indemnify us, jointly and severally, to make up for any
      shortfall in the trust account. Although enforcement of such indemnification
      obligations depends upon action by our board of directors, the exercise of
      their
      fiduciary duties as well as our amended and restated memorandum and articles
      of
      association obligate our disinterested directors to cause us to take action
      against our Sponsor, Noble Investment Fund Limited and Allius Ltd. for specific
      performance to enforce their indemnification obligations. However, we cannot
      provide any assurance that such claims would be successful. If such claims
      are
      not successful, the amount of funds in the trust account available for
      distribution to our public shareholders may be reduced and the per share
      liquidation distribution could be less than the initial $10.00 per share held
      in
      the trust account. Although each of Angela Ho and Noble Investment Fund Limited,
      the members of Ho Capital Management LLC (our Sponsor) and Dr. Gary T. Hirst
      and
      Noble Investment Fund Limited (the members of Allius Ltd.), have agreed that,
      prior to the consummation of a business combination, they will not withdraw
      as
      members of Ho Capital Management LLC and Allius Limited, a withdrawal by any
      member of our Sponsor, Allius Ltd. or Noble Investment Fund Limited will not
      affect the joint and several indemnification obligations of our Sponsor, Allius
      Ltd., or Noble Investment Fund Limited to our company. We have not independently
      verified whether our Sponsor, Noble Investment Fund Limited, or Allius Ltd.
      have
      sufficient funds to satisfy their respective indemnification obligations and,
      therefore, we cannot assure you that they would be able to satisfy these
      obligations. In addition, none of our officers or directors have agreed to
      be
      personally liable or make up for any shortfall in the trust account.
      Accordingly, we cannot assure you that the actual per-share liquidation price
      will not be less than $10.00, plus interest (net of taxes payable), due to
      claims of creditors.





Additionally,
      if we are forced to file a bankruptcy case or an involuntary bankruptcy case
      is
      filed against us which is not dismissed, the funds held in our trust account
      will be subject to applicable bankruptcy law, and may be included in our
      bankruptcy estate and subject to claims of third parties with priority over
      the
      claims of our public shareholders. To the extent bankruptcy claims deplete
      the
      trust account, we cannot assure you we will be able to return to our public
      shareholders the liquidation amounts due them.





Our
      public shareholders will be entitled to receive funds from the trust account
      only in the event of our liquidation or if they seek to redeem their respective
      shares for cash upon a business combination which the shareholder voted against
      and which is completed by us. In no other circumstances will a shareholder
      have
      any right or interest of any kind to or in the trust account.





We
      expect
      that all costs associated with the implementation and completion of our
      dissolution and liquidation as well as funds for payments to creditors, if
      any,
      will be funded by the interest earned on the trust account released to us,
      although we cannot give you assurances that there will be sufficient funds
      for
      such purposes.





Pursuant
      to the terms of our amended and restated memorandum and articles of association,
      our powers following the expiration of the permitted time periods for
      consummating a business combination will automatically thereafter be limited
      to
      acts and activities relating to dissolving and winding up our affairs, including
      liquidation. The funds held in our trust account may not be distributed except
      upon our dissolution and, until then, the funds held in our trust account will
      not be released.





**Competition
      for Target Businesses**





In
      identifying, evaluating and selecting a target business, we may encounter
      intense competition from other entities having a business objective similar
      to
      ours. Many of these entities are well established and have extensive experience
      identifying and effecting business combinations directly or through affiliates.
      Many of these competitors possess greater technical, human and other resources
      than us and our financial resources will be relatively limited when contrasted
      with those of many of these competitors. While we believe there are numerous
      potential target businesses that we could acquire with the net proceeds of
      our
      offering and the sale of the insider warrants, our ability to compete in
      acquiring certain sizable target businesses will be limited by our available
      financial resources. This inherent competitive limitation gives others an
      advantage in pursuing the acquisition of a target business. Further:





·
            our
                obligation to seek shareholder approval of a business combination
                or
                obtain the necessary financial information to be included in the
                proxy
                statement to be sent to shareholders in connection with such business
                combination may delay or prevent the completion of a
                transaction;




20




·
            our
                obligation to redeem for cash ordinary shares held by our public
                shareholders in certain instances may reduce the resources available
                to us
                for a business combination;  ·
            our
                outstanding warrants and options, and the future dilution they potentially
                represent, may not be viewed favorably by certain target businesses;
                and




·
            the
                requirement to acquire assets or an operating business that has a
                fair
                market value equal to at least 80% of the amount in our trust account
                (less deferred underwriting compensation of $3,450,000) at the time
                of the
                acquisition could require us to acquire several assets or closely
                related
                operating businesses at the same time, all of which sales would be
                contingent on the closings of the other sales, which could make it
                more
                difficult to consummate the business
                combination.





Additionally,
      we face competition from other blank-check companies which have formed recently,
      a number of which may consummate a business combination in any industry they
      choose. We may therefore be subject to competition from these companies, which
      are seeking to consummate a business plan similar to ours and which will, as
      a
      result, increase demand for privately-held companies to combine with companies
      structured similarly to ours. Further, it may be the case that there are only
      a
      limited number of attractive target businesses available to such entities or
      that many privately-held target businesses may not be inclined to enter into
      business combinations with publicly held blank check companies like us.





Any
      of
      these factors may place us at a competitive disadvantage in negotiating and
      completing a business combination. Our management believes, however, that to
      the
      extent that our target business is a privately held entity, our status as a
      well-financed public entity and the substantial industry experience of our
      officers, directors, and board of advisors may give us a competitive advantage
      over entities having a similar business objective as ours in acquiring a target
      business with significant growth potential on favorable terms.





If
      we
      succeed in effecting a business combination, there will be, in all likelihood,
      intense competition from competitors of the target business. We cannot assure
      you that, subsequent to a business combination. we will have the resources
      or
      ability to compete effectively.





**Employees**





As
      of
      March 27, 2008, we had five officers, four of whom are also members of our
      board of directors. These individuals are not obligated to contribute any
      specific number of hours per week and intend to devote only as much time as
      they
      deem necessary to our affairs. The amount of time they will devote in any time
      period will vary based on the availability of suitable target businesses to
      investigate. We do not intend to have any full time employees prior to the
      consummation of a business combination.





**ITEM
      1A. RISK FACTORS.**





*You
      should carefully consider the following risk factors and the other information
      included herein as well as the information included in other reports and filings
      made with the SEC before investing in our securities. If any of the following
      risks actually occurs, our business, financial condition or results of
      operations could be harmed. The trading price of our ordinary shares could
      decline due to any of these risks, and you may lose part or all of your
      investment.*





**Risks
      Associated With Our Business**





***We
      are a newly formed company with no operating history and, accordingly, you
      will
      not have any basis on which to evaluate our ability to achieve our business
      objective.***





We
      are a
      newly formed company with no operating results to date. Therefore, our ability
      to begin operations is dependent upon obtaining financing through the public
      offering of our securities and consummating a business combination. Since we
      do
      not have any operations or an operating history, you will have no basis upon
      which to evaluate our ability to achieve our business objective, which is to
      complete a business combination with one or more unidentified operating
      businesses, through a capital stock exchange, asset acquisition, stock purchase,
      or other similar transaction, including obtaining a majority interest through
      contractual arrangements, that is either located in, selling its products or
      services in, or otherwise investing in Asia, with a specific focus on China.
      We
      will only acquire a business or businesses that, upon completion of our initial
      business combination, will be our majority-owned subsidiaries and will be
      neither investment companies nor companies excluded from the definition of
      investment company by Sections 3(c)(1) or 3(c)(7) of the Investment Company
      Act
      of 1940. We do not have any specific business combination under consideration
      or
      contemplation. We have commenced our acquisition efforts, including sourcing and identifying potential target
      acquisitions .
      We will
      not generate any revenues or income (other than interest income, net of taxes,
      if any, on the proceeds of our offering) until, at the earliest, after the
      consummation of a business combination. We cannot assure you as to when or
      if a
      business combination will occur, or that even if we are successful in
      consummating a business combination, that our company will operate profitably
      in
      the future.




21





***If
      we are forced to dissolve and liquidate before a business combination our
      warrants will expire worthless.***





If
      we are
      unable to complete a business combination and are forced to dissolve, liquidate
      and wind up, there will be no amount payable upon such liquidation with respect
      to our outstanding warrants and, accordingly, the warrants will expire
      worthless. For a more complete discussion of the effects on our shareholders
      if
      we are unable to complete a business combination, see the section entitled
      “Effecting a business combination — Dissolution and liquidation if no
      business combination.”





***You
      will not be entitled to protections normally afforded to investors of blank
      check companies including the ability to receive all interest earned on the
      amount held in trust.***





Since
      the
      net proceeds of our offering are intended to be used to complete a business
      combination with a target business that has not been identified, we may be
      deemed to be a “blank check” company under the United States securities laws.
      However, since we have net tangible assets in excess of $5,000,000 upon the
      consummation of our offering and have filed a Current Report on Form 8-K with
      the SEC upon consummation of our offering, including an audited balance sheet
      demonstrating this fact, we are exempt from rules promulgated by the SEC to
      protect investors of blank check companies such as Rule 419. Accordingly,
      investors will not be afforded the benefits or protections of those rules,
      such
      as entitlement to all the interest earned on the funds deposited into the trust
      account. Because we are not subject to Rule 419, a significant amount of the
      interest earned on the funds deposited in the trust account will be released
      to
      us to fund our working capital and will not be available at all to those public
      shareholders redeeming in connection with a business combination and our units
      will be immediately tradable.





***Because
      there are numerous companies with a business plan similar to ours seeking to
      effectuate a business combination, including companies seeking to consummate
      a
      business combination with companies in China, it may be more difficult for
      us to
      do so.***





Based
      upon publicly available information, as of January 15, 2008, approximately
      145
      similarly structured blank check companies have completed initial public
      offerings in the United States. Of these companies, only 43 companies have
      consummated a business combination, while 23 other companies have announced
      they
      have entered into a definitive agreement for a business combination, but have
      not consummated such business combination and seven companies have failed to
      consummate a business combination and have either returned or announced their
      intention to return proceeds to their stockholders. Accordingly, there are
      over
      71 blank check companies with more than $11.0 billion in trust that are seeking
      to carry out a business plan similar to our business plan. Of these companies,
      12 with more than $823 million in trust are seeking to consummate a business
      combination with a company in the PRC. Furthermore, there are a number of
      additional offerings for blank check companies that are still in the
      registration process but have not completed initial public offerings and there
      are likely to be more blank check companies filing registration statements
      for
      initial public offerings after the date of this report and prior to our
      completion of a business combination. While some of those companies must
      complete a business combination in specific industries, a number of them may
      consummate a business combination in any industry they choose. Therefore, we
      may
      be subject to competition from these and other companies seeking to consummate
      a
      business plan similar to ours. Because of this competition, we cannot assure
      you
      that we will be able to effectuate a business combination within the required
      time periods. Further, the fact that only 66 of such companies have either
      consummated a business combination or entered into a definitive agreement for
      a
      business combination may indicate that there are fewer attractive target
      businesses available to such entities or that many privately-held target
      businesses are not inclined to enter into these types of transactions with
      publicly held blank check companies like ours.





***We
      will proceed with a business combination only if public shareholders owning
      one
      share less than 35% of the shares sold in our offering exercise their redemption
      rights, which is a lower threshold than that of a traditional blank check
      company and will make it easier for us to proceed with a proposed acquisition.***





We
      will
      proceed with a business combination only if: (i) a majority of the ordinary
      shares cast at the meeting are voted in favor of the business combination,
      (ii)
      if public shareholders owning less than 35% of the total number of shares sold
      in our offering exercise their redemption rights in accordance with the
      instructions set forth in the proxy materials to be mailed to our shareholders,
      and (iii) a majority of our outstanding ordinary shares are voted in favor
      of an
      amendment to our amended and restated memorandum and articles of association
      to
      permit our perpetual existence (as further discussed under the heading *“Effecting
      a business combination — Redemption Rights”* ).
      Accordingly, public shareholders owning up to one share less than 35% of the
      total number of shares sold in our offering may exercise their redemption rights
      and we could still consummate a proposed business combination. As a result,
      this
      may have the effect of making it more likely that we could consummate a proposed
      business combination even when a significant number of public shareholders
      have
      voted against such transaction. We have increased the redemption percentage
      from
      20% to one share less than 35% of the total number of shares sold in our
      offering in order to reduce the likelihood that a small group of investors
      holding a block of our stock will be able to stop us from completing a business
      combination that may otherwise be approved by a large majority of our public
      shareholders. While there are a few other business combination companies similar
      to ours which contain redemption provisions greater than 20%, the 20% threshold
      is customary and standard for offerings similar to ours.




22





***Exercise
      of redemption rights must be effected pursuant to a specific process which
      may
      take time to complete and may result in the expenditure of funds by shareholders
      seeking redemption.***





A
      shareholder requesting redemption of his, her or its ordinary shares for cash
      may do so at any time after the mailing to our shareholders of the proxy
      statement and prior to the vote taken with respect to a proposed business
      combination. A shareholder would have from the time we send out our proxy
      statement through the vote on the business combination to tender (either
      electronically or through the delivery of physical stock certificates) such
      shareholder’s ordinary shares if he, she or it wishes to seek to exercise his,
      her or its redemption rights. There is a nominal cost associated with the
      above-referenced tendering process and the act of certificating the shares
      or
      delivering them through the DWAC system. The transfer agent will typically
      charge the tendering broker $35 and it would be up to the broker whether or
      not
      to pass this cost on to the redeeming shareholder. There may be additional
      mailing and other nominal charges depending on the particular process used
      to
      tender the ordinary shares. Although we believe the time period, costs and
      other
      potential burdens associated with the tendering process are not onerous for
      an
      average investor, this process may result in additional burdens for
      shareholders, including mis-delivery or any other defect in the tendering
      process.





Additionally,
      if a vote on our initial business combination is held and the business
      combination is not approved, we may continue to try to consummate a business
      combination with a different target until twenty four months from the date
      of
      our prospectus. If the initial business combination is not approved or completed
      for any reason, public shareholders voting against our initial business
      combination who exercised their redemption rights would not be entitled to
      redeem their ordinary shares into a pro rata share of the aggregate amount
      then
      on deposit in the trust account. In such case, if we have required public
      shareholders to tender their certificates prior to the meeting, we will promptly
      return such certificates to the tendering public shareholder. In such case,
      they
      would then have to comply with the tendering process again for any vote against
      a subsequent business combination.





***The
      terms on which we may effect a business combination can be expected to become
      less favorable as we approach our 18 and 24 month
      deadlines.***





Pursuant
      to our amended and restated memorandum and articles of association, we must
      effect and initiate procedures for our dissolution and liquidation and the
      distribution of our assets, including the funds held in the trust account,
      if we
      do not effect a business combination within 18 months after completion of our
      offering (or within 24 months after the completion of our offering if a letter
      of intent, agreement in principle or definitive agreement has been executed
      within 18 months after completion of our offering and the business combination
      related thereto has not been completed within such 18-month period). We have
      agreed with the trustee to promptly adopt a plan for the liquidation and
      distribution of our assets, including the funds held in the trust account,
      upon
      expiration of the time periods set forth above.





Any
      entity with which we negotiate, or attempt to negotiate, a business combination,
      will, in all likelihood, be aware of these time limitations and can be expected
      to negotiate accordingly. In such event, we may not be able to reach an
      agreement with any proposed target prior to such period and any agreement that
      is reached may be on terms less favorable to us than if we did not have the
      time
      period restrictions set forth above. Additionally, as the 18 or 24 month time
      periods draw closer, we may not have the desired amount of leverage in the
      event
      any new information comes to light after entering into definitive agreements
      with any proposed target but prior to consummation of a business transaction.





***If
      third parties bring claims against us, the proceeds held in trust could be
      reduced and the per-share liquidation price received by shareholders from the
      trust account as part of our dissolution and liquidation may be less than $10.00
      per share.***




Our
      placing
      of funds in trust may not protect those funds from third party claims against
      us. Although we will seek to have all vendors, prospective target businesses
      or
      other entities with which we execute agreements waive any right, title, interest
      or claim of any kind in or to any monies held in the trust account for the
      benefit of our public shareholders, there is no guarantee that they will execute
      such agreements, or even if they execute such agreements that they would be
      prevented from bringing claims against the trust account, including, but not
      limited to, fraudulent inducement, breach of fiduciary responsibility and other
      similar claims, as well as claims challenging the enforceability of the waiver,
      in each case in order to gain an advantage with a claim against our assets,
      including the funds held in the trust account. If any third party refused to
      execute an agreement waiving such claims to the monies held in the trust
      account, we would perform an analysis of the alternatives available to us if
      we
      chose not to engage such third party and evaluate if such engagement would
      be in
      the best interest of our shareholders if such third party refused to waive
      such
      claims. Examples of possible instances where we may engage a third party that
      refused to execute a waiver include the engagement of a third party consultant
      whose particular expertise or skills are believed by management to be
      significantly superior to those of other consultants that would agree to execute
      a waiver or in cases where management is unable to find a provider of required
      services willing to provide the waiver. In addition, there is no guarantee
      that
      such entities will agree to waive any claims they may have in the future as
      a
      result of, or arising out of, any negotiations, contracts or agreements with
      us
      and not seek recourse against the trust account for any reason.




23





Accordingly,
      the proceeds held in trust could be subject to claims that could take priority
      over the claims of our public shareholders and the per-share liquidation price
      could be less than the $10.00 per share held in the trust account, plus interest
      (net of any taxes due on such interest, which taxes, if any, shall be paid
      from
      the trust account and net of any amounts released to us as working capital,
      or
      to fund costs associated with our automatic dissolution and liquidation if
      we do
      not consummate a business combination), due to claims of such creditors.
      Additionally, in the event we do not have sufficient funds available to us
      to
      consummate and complete our dissolution and liquidation, our Sponsor has agreed
      that either it or its affiliates will fund all costs associated with our
      dissolution and liquidation. Based on information we have obtained from such
      entities and individuals, we currently believe that such entities and
      individuals are capable of funding both a shortfall in our trust account and
      the
      costs associated with our dissolution and liquidation, even though we have
      not
      asked them to reserve for such an eventuality. However, we cannot assure you
      that our Sponsor or its affiliates will be able to satisfy those obligations.
      We
      believe the likelihood of our Sponsor, Noble Investment Fund Limited and Allius
      Ltd. having to indemnify the trust account is minimal because we will endeavor
      to have all vendors and prospective target businesses, as well as other
      entities, execute agreements with us waiving all right, title, interest or
      claim
      of any kind in or to monies held in the trust account.





Additionally,
      if we are forced to declare insolvency or a case for involuntary liquidation
      is
      filed against us which is not dismissed, the funds held in our trust account
      will be subject to applicable Cayman Islands’ insolvency law, and may be
      included in our estate and subject to the claims of third parties with priority
      over claims of our public shareholders. To the extent any such claims deplete
      the trust account we cannot assure you we will be able to return to public
      shareholders the amounts payable to them upon a liquidation of the trust
      account.





***Although
      our disinterested directors will bring claims on our behalf to enforce the
      joint
      and several indemnification obligations of our Sponsor, Noble Investment Fund
      Limited and Allius Ltd., there is no assurance that such claims would be
      successful, resulting in a reduction in the amount of funds in the trust account
      available for distribution to our public shareholders.***





Our
      Sponsor, Noble Investment Fund Limited and Allius Ltd. have agreed that they
      will be jointly and severally liable to ensure that the proceeds in the trust
      account are not reduced by the claims of target businesses or claims of vendors
      or other entities that are owed money by us for services rendered or contracted
      for or products sold to us, but only to the extent we have not obtained a valid
      and enforceable waiver from such parties. In the event that the proceeds in
      the
      trust account are reduced and our Sponsor, Noble and Allius assert that they
      are
      unable to satisfy their obligations or that they have no indemnification
      obligations related to a particular claim, our disinterested directors will
      cause us to take legal action against them for specific performance to enforce
      their indemnification obligations. Our disinterested directors will cause us
      to
      take action against our Sponsor, Noble and Allius because our board of directors
      has a fiduciary obligation to bring such claims and our amended and restated
      memorandum and articles of association require our disinterested directors
      to
      bring such claims, if required. However, we can provide no assurance that such
      claims would be successful. If such claims are not successful, the amount of
      funds in the trust account available for distribution to our public shareholders
      may be reduced and the per share liquidation distribution could be less than
      the
      initial $10.00 per share held in the trust account.





***We
      will have only limited ability to evaluate the management of the target
      business.***





It
      is
      anticipated that, upon consummation of a business combination, all of our
      officers and directors will resign as officers and directors of the combined
      company, and that the executive officers and directors of the target company
      will become the executive officers and directors of our company after the
      business combination. Accordingly, the future success or failure of our company
      will depend largely upon the efforts of the senior management and board of
      directors of an, as yet, unidentified company. Although we intend to closely
      scrutinize the management of a prospective target business in connection with
      evaluating the desirability of effecting a business combination, we cannot
      assure you that our assessment of such management will prove to be
      correct.





***Although
      our current officers and directors intend to resign upon consummation of a
      business combination, under certain circumstances they may receive ongoing
      compensation following such business combination.***





Our
      board
      of directors and officers will not receive either from our company or the target
      company any finder’s fee or related payment in connection with a business
      combination, or condition such business combination upon any or all of them
      receiving or retaining any position or obtaining any ongoing compensation
      following the business combination through any employment or consulting
      agreement or similar arrangement. However, if requested by the shareholders
      or
      directors of a prospective target company, one or more members of our board
      of
      directors may remain as a director of or consultant to our company and its
      subsidiaries following the business combination, and in connection therewith,
      will receive compensation to be negotiated with the board of directors or
      shareholders of the target company. If we acquire control of a target business
      in an all-cash transaction, it is more likely that one or more current members
      of management would remain with us as a director, or in senior management or
      advisory positions. If a business combination is structured as a merger or
      exchange of shares whereby the shareholders of the target company were to
      receive significant ordinary shares in our company in connection with such
      business combination, it would be less likely that any of our officers or
      directors will remain with the combined company. If any of our management or
      board members are retained post-business combination in any directorship or
      other consulting capacity, it may result in a conflict of interest. In addition,
      the financial interest of our officers and directors, including any compensation
      arrangements, could influence their motivation in selecting, negotiating and
      structuring a transaction with a target business, and thus, there may be a
      conflict of interest when determining whether a particular business combination
      is in the stockholders’ best interest.




24




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





None
      of
      our officers, directors or initial shareholders are currently affiliated with
      any entity whose primary business focus includes acquisitions in Asia. Each
      of
      our officers, directors and initial shareholders have agreed that, until we
      consummate a business combination or liquidate our trust account, they will
      not
      become associated or affiliated with any such competing entity. In addition,
      such persons have agreed that they will present to our board of directors any
      acquisition opportunity in Asia they obtain access to and which could reasonably
      be expected to be valued at 80% or more of the total amount placed in our trust
      account upon completion of our offering (excluding deferred underwriting fees),
      and provide us a right of first refusal to consummate such an acquisition.
      However, there can be no assurance that these agreements will be fully complied
      with in all instances. One or more of our officers, directors or initial
      shareholders could breach these agreements by failing to present to our board
      of
      directors one or more acquisition opportunities in Asia they obtain access
      to
      and which meets the 80% threshold. If we become aware of any such breach, our
      disinterested directors will cause us to bring a claim against such officer,
      director or initial shareholders for specific performance or damages incurred
      by
      us in connection with any such breach. However, no assurance can be given that
      we would be successful with respect to any such claims. For a more complete
      discussion of our management’s affiliations and the potential conflicts of
      interest that you should be aware of, see the sections below entitled
“Management — Directors and Executive Officers” and
“Management — Conflicts of Interest.” We cannot assure you that these
      conflicts will be resolved in our favor.





***Our
      officers and directors may have other conflicts of interest.***




The
      personal
      and financial interests of our directors and officers may influence their
      motivation in identifying and selecting a target business and completing a
      business combination. All of our executive officers and directors own ordinary
      shares which will be released from escrow only if we consummate a business
      combination and with respect to which they are waiving their redemption and
      liquidation distribution rights if we liquidate. In addition, immediately prior
      to the date of our prospectus, our Sponsor, which is co-managed and jointly
      owned by Angela Ho, our chief executive officer and chairman of our board of
      directors, and Noble Investment Fund Limited, purchased for $1.00 each, warrants
      to purchase an aggregate of 5,725,000 of our ordinary shares, which insider
      warrants are identical to the warrants in the units being offered by our
      prospectus, except that (i) subject to limited exception, none of the insider
      warrants will be transferable or salable until after we complete a business
      combination; (ii) the warrants are not subject to redemption if held by the
      initial holders and their permitted assigns; and (iii) the warrants are
      exercisable on a cashless basis if held by the initial holder or its permitted
      assigns. Our Sponsor and Noble Investment Fund Limited each have a 50%
      beneficial ownership interest in the insider warrants. Although none of the
      insider warrants may be sold, assigned or transferred until we complete a
      business combination, permitted assigns include (i) the required transfer of
      50%
      of the insider warrants to Noble Investment Fund Limited once we complete a
      business combination, as partial consideration for, and in reduction of, a
      $5,725,000 loan to be provided by Noble to enable Ho Capital Management LLC
      to
      purchase the insider warrants, or (ii) Angela Ho, a co-manager of Ho Capital
      Management LLC. If we are forced to liquidate, the insider warrants will become
      worthless.





Accordingly,
      the financial motivation of our Sponsor and our officers and directors to
      consummate a business combination may affect their judgment in evaluating the
      merits of one or more prospective targets or result in our overpaying for a
      specific acquisition candidate.





***Although
      we initially intend to focus our efforts on acquiring an operating business
      in
      the leisure and hospitality or financial services industries that is located
      in,
      invests in, or provides products or services to consumers located in China,
      we
      will not be limited to a particular industry or area in Asia and may acquire
      control of a business operating in a particular industry and in a country in
      Asia that is beyond the expertise of our management.***





There
      is
      no specific timeframe or monetary amount established by management which will
      cause us to abandon our initial focus of acquiring an operating business in
      the
      leisure and hospitality or financial services industries that invests in, is
      located in, or provides products or services to consumers located in China,
      in
      favor of other industries or other specified countries in Asia. Early in the
      process of searching for a suitable target business, management intends to
      concentrate its focus on acquiring an operating business in the leisure and
      hospitality or financial services industries that invest in, is located in,
      or
      provides products or services to consumers located in China. However, we will
      not rule out exploring a favorable business opportunity in a different industry
      sector or area early during such process if an opportunity arises which
      management determines is in the best interests of our company and shareholders.
      Absent uncovering such opportunity, we intend to concentrate on our primary
      business and geographic focus during the first year of our business search,
      and
      only expand the scope of our search if we have been unable during such year
      to
      locate an attractive business combination in the leisure and hospitality or
      financial services industries that invests in, is located in, or provides
      products or services to consumers located in China.




25





If
      a
      favorable business opportunity presents itself to management in an industry,
      other than the leisure and hospitality or financial services industries, or
      in
      any one or more of the designated countries in Asia, other than China, such
      industry or area may be outside of management’s expertise. As a result, our
      ability to assess the growth potential, financial condition, experience and
      skill of incumbent management, competitive position, regulatory environment
      and
      other criteria in evaluating a business opportunity outside our primary business
      focus or outside of China may be adversely affected by virtue of our limited
      expertise. For a more detailed discussion of management’s process for searching
      for and selecting a target business, see “Effecting a business
      combination — Selection of a target business and structuring of a
      business combination”.





If
      we
      determine to seek to acquire control of a target business which is not operating
      in the leisure and hospitality or financial services industries that is located
      in, invests in, or provides products or services to consumers located in China
      and outside of the expertise of our management, no assurance can be given that
      we will be able to successfully complete such an acquisition and could result
      in
      the liquidation of the trust account and dissolution of our company.





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





Section
      172
      of our amended and restated memorandum and articles of association provides
      that
      we will continue in existence only until eighteen months from the consummation
      of our offering or until twenty-four months if a letter of intent, an agreement
      in principle, or a definitive agreement to complete a business combination
      has
      been entered into, except if holders of 95% or more of our outstanding ordinary
      shares approve an extension of such time period. If we have not completed a
      business combination by such date, our corporate existence will cease except
      for
      the purposes of winding up our affairs and liquidating. At this time, we will
      become subject to a voluntary liquidation procedure under the Companies Law
      (2007 Revision) of the Cayman Islands (the “Companies Law”). Our liquidator
      would give at least 21 days’ notice to creditors of his intention to make a
      distribution by notifying known creditors (if any) who have not submitted claims
      and by placing a public advertisement in the Cayman Islands Official Gazette,
      although in practice this notice requirement need not necessarily delay the
      distribution of assets if the liquidator is satisfied that no creditors would
      be
      adversely affected as a consequence of a distribution before this time period
      has expired. We anticipate that the trust account should be liquidated shortly
      following expiration of the 21-day period. As soon as the affairs of our company
      are fully wound-up, the liquidator must lay his final report and accounts before
      a final general meeting which must be called by a public notice at least one
      month before it takes place. After the final meeting, the liquidator must make
      a
      return to the registrar confirming the date on which the meeting was held and
      three months after the date of such filing our company is dissolved.





Additionally,
      in any liquidation proceedings of our company under Cayman Islands’ law, the
      funds held in our trust account may be included in our estate and subject to
      the
      claims of third parties with priority over the claims of our shareholders.
      To
      the extent any such claims deplete the trust account we cannot assure you we
      will be able to return to our public shareholders the liquidation amounts
      payable to them. Furthermore, a liquidator of our company might seek to hold
      a
      shareholder liable to contribute to our estate to the extent of distributions
      received by them pursuant to the dissolution of the trust account beyond the
      date of dissolution of the trust account. Cayman Islands law does not limit
      the
      amount of time available to a liquidator to recover funds for the estate from
      shareholders that received distributions. Additionally, we cannot assure you
      that third parties will not seek to recover from our shareholders amounts owed
      to them by us. Furthermore, our board may be viewed as having breached their
      fiduciary duties to our creditors and/or may have acted in bad faith, and
      thereby exposing itself and our company to claims for having paid public
      shareholders from the trust account prior to addressing the claims of creditors.
      We cannot assure you that claims will not be brought against us for these
      reasons.





If
      we are
      unable to consummate a transaction within the necessary time periods, our
      purpose and powers will be limited to winding up and ultimately dissolving.
      Upon
      notice from us, the trustee of the trust account will distribute the amount
      in
      our trust account to our public shareholders as part of our automatic
      dissolution and liquidation. Concurrently, we propose that our liabilities
      and
      obligations will be paid from funds not held in trust, although we cannot assure
      you that there will be sufficient funds for such purpose. If there are
      insufficient funds held outside the trust account for such purpose, our Sponsor,
      Noble Investment Fund Limited and Allius Ltd. have agreed that they will be
      jointly and severally liable to ensure that the proceeds in the trust account
      are not reduced by the claims of target businesses or claims of vendors or
      other
      entities that are owed money by us for services rendered or contracted for
      or
      products sold to us. We have not independently verified whether our Sponsor,
      Noble Investment Fund Limited or Allius Ltd. have sufficient funds to satisfy
      their respective indemnity obligations and, therefore, we cannot assure you
      that
      they would be able to satisfy these obligations.




26





***We
      will dissolve and liquidate if we do not consummate a business combination.***





Pursuant
      to,
      among other documents, our amended and restated memorandum and articles of
      association, if we do not either complete a business combination, enter into
      a
      letter of intent, agreement in principle or a definitive agreement to acquire
      a
      target company within 18 months after the consummation of our offering, or
      within 24 months after the consummation of our offering if the extension
      criteria described above have been satisfied, our corporate existence will
      cease
      except for the purposes of winding up our affairs and liquidating. Upon
      dissolution, we will distribute to all of our public shareholders, in proportion
      to their respective equity interest, an aggregate sum equal to the amount in
      the
      trust account (net of taxes payable and that portion of the interest earned
      previously released to us). Our initial shareholders, as well as our Sponsor
      who
      purchased insider warrants immediately prior to the date of our prospectus,
      have
      waived their rights to participate in any liquidation distribution with respect
      to their initial shares and the insider warrants will expire worthless upon
      our
      liquidation and dissolution. There will be no distribution from the trust
      account with respect to our warrants which will expire worthless. We will pay
      the costs of our dissolution and liquidation. Our Sponsor, Noble Investment
      Fund
      Limited and Allius Ltd. have agreed to indemnify us, jointly and severally,
      for
      these expenses to the extent there are insufficient funds available from the
      proceeds not held in the trust account and interest released to us. Upon notice
      from us, the trustee of the trust account will liquidate the investments
      constituting the trust account and will turn over the proceeds to our transfer
      agent for distribution to our public shareholders as part of our dissolution
      and
      liquidation. Concurrently, we shall pay, or reserve for payment, from interest
      released to us from the trust account if available, our liabilities and
      obligations, although we cannot give you assurances that there will be
      sufficient funds for such purpose. The amounts held in the trust account may
      be
      subject to claims by third parties, such as vendors, prospective target business
      or other entities, if we do not obtain waivers in advance from such third
      parties prior to such parties providing us with services or entering into
      arrangements with them.





These
      procedures may result in substantial delays in the liquidation of our trust
      account to our public shareholders as part of our automatic dissolution and
      liquidation.





***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 with
      respect to the ordinary shares issuable upon exercise of the warrants, we may
      elect to redeem the warrants issued as a part of our units, without the prior
      consent of any third party, 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 ordinary shares 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 warrants
      included as part of the 5,725,000 insider warrants purchased immediately prior
      to the date of our prospectus, 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 and sell the underlying shares.***





Holders
      of our warrants will be able to exercise the warrant only if (i) a current
      registration statement under the Securities Act of 1933 relating to our ordinary
      shares 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 offering
      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. The
      warrants, including the warrants included in the representative’s unit purchase
      option, may expire unexercised or unredeemed if there is no effective
      registration statement (as required by federal securities laws). In addition,
      there are no circumstances under which we will be required to net-cash settle
      the warrants, including the warrants included in the representative’s unit
      purchase option, and a purchaser, including the representative upon exercise
      of
      the unit purchase option, may pay the full unit purchase price solely for the
      shares included in the units. Moreover, 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.




27




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





Our
      amended and restated memorandum and articles of association authorizes the
      issuance of up to 50,000,000 ordinary shares, par value $.0001 per share, and
      1,000,000 shares of preferred stock, par value $.0001 per share. Immediately
      after our offering and the sale of the insider warrants (including
      the exercise of the underwriters’ over-allotment option), there were
      17,825,000 authorized but unissued ordinary shares available for issuance (after
      appropriate reservation for the issuance of shares upon full exercise of our
      outstanding warrants and the underwriters’ unit purchase option) and all of the
      1,000,000 shares of preferred stock were available for issuance. If more than
      20% but not more than one share less than 35% of the shares owned by our public
      shareholders vote against a proposed business combination and exercise their
      redemption rights, we will still be required to utilize 80% of the amount in
      our
      trust account for the business combination (excluding deferred underwriting
      fees). In the event that such redemption leaves us with an insufficient amount
      of funds to consummate a proposed business combination then, we may issue a
      significant amount of our debt or equity securities to the sellers of such
      businesses and/or seek to raise additional funds through a private offering
      of
      debt or equity securities. Although we have no commitments as of the date of
      our
      offering to issue our securities, we may issue a substantial number of
      additional ordinary or preferred shares, or a combination of ordinary and
      preferred shares, to complete a business combination. The issuance of additional
      ordinary shares or any number of our preferred shares:





·
            may
                significantly reduce the equity interest of investors in our
                offering;





·
            will
                likely cause a change in control if a substantial number of our ordinary
                shares 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 ordinary
                shares.





Additionally,
      the financial services industry is capital intensive, traditionally using
      substantial amounts of indebtedness to finance acquisitions and working capital
      needs. 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 a business
                combination were insufficient to pay our debt
                obligations;





·
            acceleration
                of our obligations to repay the indebtedness even if we have made
                all
                principal and interest payments when due if the debt security 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.





For
      a
      more complete discussion of the possible structure of a business combination,
      see the section entitled “Effecting a business combination — Selection
      of a target business and structuring of a business combination.”





***We
      may have insufficient resources to cover our operating expenses and the expenses
      of consummating a business combination.***





We
      will pay
      approximately $50,000 (not including up to $2,000,000 of interest we may earn
      on
      funds in the trust account, which we are entitled to receive in order to cover
      our operating expenses and our costs associated with our dissolution and
      liquidation if we do not consummate a business combination) from the proceeds
      of
      our offering and the sale of the insider warrants to cover our operating
      expenses for the next 24 months and to cover the expenses incurred in connection
      with a business combination. This amount is based on management’s estimates of
      the costs needed to fund our operations for the next 24 months and consummate
      a
      business combination. Those estimates may prove inaccurate, especially if a
      portion of the available proceeds is used to make a down payment or pay
      exclusivity or similar fees in connection with a business combination or if
      we
      expend a significant portion of the available proceeds in pursuit of a business
      combination that is not consummated. If we do not have sufficient proceeds
      available to fund our expenses, we may be forced to obtain additional financing,
      either from our management or the initial shareholders or from third parties.
      We
      may not be able to obtain additional financing and our initial shareholders
      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.




28





***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.***





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
      using the proceeds of our offering and the sale of the insider warrants. Our
      management’s lack of experience in operating a blank check company could
      adversely affect our ability to consummate a business combination and force
      us
      to dissolve and liquidate the trust account to our public shareholders in an
      automatic dissolution and liquidation.





***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. For a discussion of potential conflicts of interest that you should
      be aware of, see the section entitled “Management — Conflicts of
      Interest.” We cannot assure you that these conflicts will be resolved in our
      favor.





***All
      of our officers and directors own ordinary shares, and our Sponsor, an affiliate
      of our chairman of the board of directors, own insider warrants, which will
      not
      participate in the liquidation of the trust account in the event of our
      automatic dissolution and liquidation; therefore such persons may have a
      conflict of interest in determining whether a particular target business is
      appropriate for a business combination.***





All
      of
      our officers and directors own stock in our company, and our Sponsor, an entity
      that is co-managed and jointly owned by Angela Ho, our chief executive officer
      and chairman of the board of directors, and Noble Investment Fund Limited,
      owns
      our insider warrants purchased for $5,725,000 immediately prior to the date
      of
      our prospectus. Angela Ho and Noble Investment Fund Limited each have a 50%
      beneficial ownership interest in the insider warrants held in the name of our
      Sponsor. Our officers and directors and our Sponsor have waived their right
      to
      the liquidation of the trust account in the event of our automatic dissolution
      and liquidation with respect to those shares upon the liquidation of the trust
      account to our public shareholders if we are unable to complete a business
      combination. The shares and warrants owned by these persons (including our
      officers and directors) will be worthless if we do not consummate a business
      combination. The personal and financial interests of these officers and
      directors and our Sponsor may influence their motivation in identifying and
      selecting a target business and completing a business combination in a timely
      manner. Consequently, these officers and directors’ discretion in identifying
      and selecting a suitable target business may result in a conflict of interest
      when determining whether the terms, conditions and timing of a particular
      business combination are appropriate and in our shareholders’ best
      interest.





***Our
      initial shareholders will not receive reimbursement for any out-of-pocket
      expenses incurred by them to the extent that such expenses exceed the amount
      available outside the trust account unless the business combination is
      consummated and therefore they may have a conflict of interest.***





Our
      initial shareholders will not receive reimbursement for any out-of-pocket
      expenses incurred by them to the extent that such expenses exceed the amount
      available outside the trust account, unless the business combination is
      consummated. The amount of available proceeds is based on management estimates
      of the capital needed to fund our operations for the next 24 months and to
      consummate a business combination. Those estimates may prove to be inaccurate,
      especially if a portion of the available proceeds is used to make a down payment
      or pay exclusivity or similar fees in connection with a business combination
      or
      if we expend a significant portion in pursuit of an acquisition that is not
      consummated. The financial interest of such persons could influence their
      motivation in selecting a target business and thus, there may be a conflict
      of
      interest when determining whether a particular business combination is in the
      shareholders’ best interest.




29





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




If
      at any
      time we have net tangible assets of less than $5,000,000 and our ordinary shares
      have a market price per share of less than $5.00, transactions in our ordinary
      shares 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;





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





***It
      is probable our initial business combination will be with a single target
      business, which may cause us to be solely dependent on a single business and
      a
      limited number of products or services. Additionally, we may face obstacles
      to
      completing simultaneous acquisitions.***





Our
      initial business combination must be with a business or businesses with a
      collective fair market value of at least 80% of the amount in our trust account
      (excluding $3,450,000 of deferred compensation to be held for the benefit of
      the
      underwriters) at the time of such acquisition, which amount is required as
      a
      condition to the consummation of our initial business combination. In addition,
      if more than 20% but not more than one share less than 35% of the shares owned
      by our public shareholders vote against a proposed business combination and
      exercise their redemption rights, we will still be required to utilize 80%
      of
      the amount in our trust account for the business combination. In the event
      that
      such redemption leaves us with an insufficient amount of funds to consummate
      a
      proposed business combination then, we may issue a significant amount of our
      debt or equity securities to the sellers of such businesses and/or seek to
      raise
      additional funds through a private offering of debt or equity securities. Since
      we have no specific business combination under consideration, we have not
      entered into any such fund raising arrangement and have no current intention
      of
      doing so (other than the 5,725,000 insider warrants for an aggregate of
      $5,725,000). We may not be able to acquire more than one target business because
      of this and various other factors, including the amount of funds available
      to
      consummate a business combination, possible complex accounting issues, which
      would include generating pro forma financial statements reflecting the
      operations of several target businesses as if they had been combined, and
      numerous logistical issues, which could include attempting to coordinate the
      timing of negotiations, proxy statement disclosure and closings with multiple
      target businesses. In addition, we may not have sufficient management, financial
      and other resources to effectively investigate the business and affairs of
      multiple acquisition candidates simultaneously or to negotiate the terms of
      multiple acquisition agreements at the same time which could result in a failure
      to properly evaluate multiple acquisitions. Further, we would also be exposed
      to
      the risk that conditions to closings with respect to the acquisition of one
      or
      more of the target businesses would not be satisfied bringing the fair market
      value of the initial business combination below the required fair market value
      of 80% of the amount in our trust account (excluding $3,450,000 of deferred
      compensation to be held for the benefit of the underwriters) threshold.
      Accordingly, while it is possible we may attempt to effect our initial business
      combination with more than one target business, we are more likely to choose
      a
      single target business if deciding between one target business meeting such
      80%
      threshold and comparable multiple target business candidates collectively
      meeting the 80% threshold. Consequently, it is probable that, unless the
      purchase price consists substantially of our equity, we will have the ability
      to
      complete only the initial business combination with the proceeds of our offering
      and the sale of the insider warrants. Accordingly, the prospects for our success
      may be:





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





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





In
      this
      case, we will not be able to diversify our operations or benefit from the
      possible spreading of risks or offsetting of losses, unlike other entities
      which
      may have the resources to complete several business combinations in different
      industries or different areas of a single industry.




30





***The
      ability of our shareholders to exercise their redemption rights may not allow
      us
      to effectuate the most desirable business combination or optimize our capital
      structure.***





At
      the
      time we seek shareholder approval of any business combination, we will offer
      each public shareholder the right to have such shareholder’s ordinary shares
      redeemed for cash if the shareholder votes against the business combination
      and
      the business combination is approved and completed. Accordingly, if our business
      combination requires us to use substantially all of our cash to pay the purchase
      price, because we will not know how many shareholders may exercise such
      redemption rights, we may either need to reserve part of the trust account
      for
      possible payment upon such redemption, or we may need to arrange third party
      financing to help fund our business combination in case a larger percentage
      of
      shareholders exercise their redemption rights than we expected. Therefore,
      we
      may not be able to consummate a business combination that requires us to use
      all
      of the funds held in the trust account as part of the purchase price, or we
      may
      end up having a leverage ratio that is not optimal for our business combination.
      This may limit our ability to effectuate the most attractive business
      combination available to us.





***We
      will not be required to obtain an opinion from an investment banking firm as
      to
      the fair market value of a proposed business combination if our board of
      directors independently determines that the target business has sufficient
      fair
      market value.***





The
      initial
      target business that we acquire must have a fair market value equal to at least
      80% of the amount in our trust account (excluding $3,450,000 of deferred
      compensation to be held for the benefit of the underwriters) at the time of
      such
      acquisition. There is no limitation on our ability to raise funds privately
      or
      through loans that would allow us to acquire a target business or businesses
      with a fair market value in an amount considerably greater than 80% of the
      amount in our trust account (excluding $3,450,000 of deferred compensation
      to be
      held for the benefit of the underwriters) at the time of such acquisition.
      We
      have not had any preliminary discussions, or made any agreements or
      arrangements, with respect to financing arrangements with any third party.
      The
      fair market value of such business will be determined by our board of directors
      based upon standards generally accepted by the financial community, such as
      actual and potential sales, earnings and cash flow and book value, and the
      price
      for which comparable businesses have recently been sold. If our board is not
      able to independently determine that the target business has a sufficient fair
      market value, we will obtain an opinion from an unaffiliated, independent
      investment banking firm which is a member of the Financial Industry Regulatory
      Authority with respect to the satisfaction of such criteria. Since any opinion,
      if obtained, would merely state that fair market value meets the 80% threshold
      described above, it is not anticipated that copies of such opinion would be
      distributed to our shareholders, although copies will be provided to
      shareholders who request it. If we do obtain the opinion of an investment
      banking firm, a summary of the opinion will be contained in the proxy statement
      that will be mailed to shareholders in connection with obtaining approval of
      the
      business combination, and the investment banking firm will consent to the
      inclusion of their report in our proxy statement. In addition, information
      about
      how shareholders will be able to obtain a copy of the opinion from us will
      be
      contained in the proxy statement. However, we do not anticipate that
      shareholders will be entitled to rely on any such opinion. If the independent
      investment banking firm takes the view that shareholders may not rely on the
      opinion, we will not consider such a view as a factor in deciding which
      investment banking firm to hire. We will not be required to obtain an opinion
      from an investment banking firm as to the fair market value of a proposed
      business combination if our board of directors independently determines that
      the
      target business has sufficient fair market value.





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





Although
      we believe that the net proceeds of our offering and the sale of the insider
      warrants will be sufficient to allow us to consummate a business combination,
      inasmuch as we have not yet identified any prospective target business, we
      cannot ascertain the capital requirements for any particular transaction. If
      the
      net proceeds of our offering and the sale of the insider warrants prove to
      be
      insufficient, either because of the size of the business combination or the
      depletion of the available net proceeds in search of a target business, or
      because we become obligated to redeem for cash a significant number of shares
      from dissenting shareholders, we will be required to seek additional financing.
      We cannot assure you that such financing would be available on acceptable terms,
      if at all. To the extent that additional financing proves to be unavailable
      when
      needed to consummate a particular business combination, we would be compelled
      to
      restructure the transaction or abandon that particular business combination
      and
      seek an alternative target business candidate. In addition, if we consummate
      a
      business combination, we may require additional financing to fund the operations
      or growth of the target business. The failure to secure additional financing
      could have a material adverse effect on the continued development or growth
      of
      the target business. None of our officers, directors or shareholders is required
      to provide any financing to us in connection with or after a business
      combination.




***Our
      initial shareholders, including our officers and directors, control a
      substantial interest in us and thus may influence certain actions requiring
      shareholder vote.***





Upon
      consummation of our offering our initial shareholders (including all of our
      officers and directors) will collectively own 20% of our issued and outstanding
      ordinary shares. Our officers, directors and initial shareholders, have advised
      us that that they do not intend to purchase any units in our offering. However,
      our officers, directors and our initial shareholders, may make any purchases
      either in the open market, in private placements or other private transactions
      following the offering, although we are not aware that any of such persons
      or
      entities intend to do so. While we cannot be certain of all of the factors
      that
      would cause our existing officers, directors or shareholders to purchase our
      securities, we believe that some of the factors they would consider are: (i)
      the
      trading price of our securities, (ii) their aggregate investment in our
      securities, (iii) whether it appears that a substantial number of public
      shareholders are voting against a proposed business combination, and (iv) their
      interest in the target business once the target business has been identified.
      Any shares acquired by such individuals in our offering or in the aftermarket
      will be voted in favor of the business combination. Accordingly, any purchase
      of
      our shares by our officers and directors, including all of our initial
      shareholders, in our offering or in the aftermarket could influence the result
      of a vote submitted to our shareholders in connection with a business
      combination by making it more likely that a business combination would be
      approved.




31





Our
      board of
      directors is divided into two classes, each of which will generally serve for
      a
      term of two years with only one class of directors being elected in each year.
      It is unlikely that there will be an annual meeting of shareholders to elect
      new
      directors prior to the consummation of a business combination, in which case
      all
      of the current directors will continue in office at least until the consummation
      of the business combination. If there is an annual meeting, as a consequence
      of
      our “staggered” board of directors, initially only a minority of the board of
      directors will be considered for election and our initial shareholders, because
      of their ownership position, will have considerable influence regarding the
      outcome. Accordingly, our initial shareholders will continue to exert control
      at
      least until the consummation of a business combination. In addition, our initial
      shareholders and their affiliates and relatives are not prohibited from
      purchasing units in our offering or in the open market. If they do, we cannot
      assure you that our initial shareholders will not have considerable influence
      upon the vote in connection with a business combination.





***Since
      our initial shareholders will lose their entire investment in us if a business
      combination is not consummated and may be required to pay costs associated
      with
      our liquidation, our initial shareholders may purchase ordinary shares from
      shareholders who would otherwise choose to vote against a proposed business
      combination or exercise their redemption rights in connection with such business
      combination.***





Our
      initial shareholders own ordinary shares that will be worthless if we do not
      consummate a business combination. In addition, immediately prior to the date
      of
      our prospectus, our Sponsor purchased warrants exercisable for our ordinary
      shares (for an aggregate of $5,725,000), which will also be worthless if we
      do
      not consummate a business combination.





Given
      the
      interest that our initial shareholders have in a business combination being
      consummated, it is possible that our initial shareholders will acquire
      securities from public shareholders (in the open market and/or in privately
      negotiated transactions) who have elected to redeem their ordinary shares in
      order to change their vote and insure that the business combination will be
      approved (which could result in a business combination being approved even
      if,
      after the announcement of the business combination, 35% or more of our public
      shareholders would have elected to exercise their redemption rights, or more
      than 50% of our public shareholders would have voted against the business
      combination, but for the purchases made by our initial shareholders). Any
      privately negotiated transaction with a shareholder would include a contractual
      acknowledgement that such shareholder, although still the record holder of
      our
      ordinary shares is no longer the beneficial owner thereof and therefore agrees
      to vote such ordinary shares as directed by our initial shareholders. In the
      event our initial shareholders purchase shares in privately negotiated
      transactions from public shareholders who have already cast votes against a
      proposed business combination and requested redemption of their shares, such
      selling shareholders would be required to revoke their prior votes against
      the
      proposed business combination and to revoke their prior elections to redeem
      their shares and to cast new votes in favor of the proposed business
      combination. The revocation of prior negative votes and substitution therefor
      of
      votes in favor of the proposed business combination would have the effect of
      reducing redemptions and increasing votes in favor of the proposed business
      combination, thereby making it more likely that a proposed business combination
      would be approved.





***We
      will be dependent upon interest earned on the trust account to fund our search
      for a target company and consummation of a business combination.***





Of
      the
      net proceeds of our offering and the $5,725,000 proceeds of the sale of the
      insider warrants, only $50,000 is estimated to be available to us initially
      outside the trust account to fund our working capital requirements. We will
      be
      dependent upon sufficient interest being earned on the proceeds held in the
      trust account to provide us with the additional working capital we will need
      to
      search for a target company and consummate a business combination. While we
      are
      entitled to a portion of the interest earned on the trust account in excess
      of
      the amount necessary to allow for a $10.00 per share liquidation price to our
      public shareholders for such purpose, if interest rates were to decline
      substantially, we may not have sufficient funds available to complete a business
      combination. In such event, we would need to borrow funds from our insiders
      or
      others or be forced to dissolve, liquidate and wind up.




32





***The
      number of potential target businesses that we may seek to acquire may be limited
      by the fact that any selected target business will be required to provide
      audited financial statements prepared in accordance with and reconciled to
      United States generally accepted accounting principles.***





In
      accordance
      with requirements of United States Federal securities laws, in order to seek
      shareholder approval of a business combination, a proposed target business
      will
      be required to have certain financial statements which are prepared in
      accordance with, or which can be reconciled to, U.S. generally accepted
      accounting principles and audited in accordance with U.S. generally accepted
      auditing standards. To the extent that a proposed target business we deem to
      be
      attractive does not have financial statements which have been prepared with,
      or
      which can be reconciled to, U.S. GAAP, and audited in accordance with U.S.
      GAAS,
      we will not be able to acquire that proposed target business. These financial
      statement requirements may limit the pool of potential target businesses which
      we may acquire.





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





In
      connection with the sale of the 10,000,000 units, we offered and sold,
      immediately prior to the date of our prospectus to our Sponsor, for $1.00 each,
      warrants to purchase 5,725,000 ordinary shares. In addition, we have sold to
      the
      underwriters an option to purchase up to an aggregate of 475,000 units for
      $12.50 per unit (which includes an aggregate of 475,000 ordinary shares and
      475,000 warrants to purchase ordinary shares). To the extent we issue ordinary
      shares to effect a business combination, the potential for the issuance of
      substantial numbers of additional shares upon exercise of these warrants could
      make us a less attractive acquisition vehicle in the eyes of a target business
      as such securities, when exercised, will increase the number of issued and
      outstanding ordinary shares and reduce the value of the ordinary shares issued
      to complete the business combination. Accordingly, our warrants may make it
      more
      difficult to effectuate a business combination or increase the cost of the
      target business. Additionally, the sale, or even the possibility of sale, of
      the
      ordinary shares underlying the warrants could have an adverse effect on the
      market price for our securities or on our ability to obtain future public
      financing. If and to the extent these warrants are exercised, you may experience
      dilution to your holdings.





***If
      our initial shareholders (including our Sponsor who purchased the insider
      warrants) exercise their registration rights, it may have an adverse effect
      on
      the market price of our ordinary shares and the existence of these rights may
      make it more difficult to effect a business combination.***





Our
      initial shareholders, including our Sponsor purchased insider warrants
      immediately prior to the date of our prospectus, are entitled to require us
      to
      register the resale of their ordinary shares at any time after the date on
      which
      their shares are released from escrow. With respect to the ordinary shares
      underlying the 5,725,000 insider warrants sold to our Sponsor, our Sponsor
      is
      entitled to require us to register the resale of their ordinary shares upon
      our
      announcement of the entering into a definitive agreement to complete a business
      combination. If such initial shareholders exercise their registration rights
      with respect to all of their ordinary shares (including those 5,725,000 ordinary
      shares issuable upon exercise of the insider warrants), then there will be
      an
      additional 8,225,000 ordinary shares eligible for trading in the public market
      and we will bear the costs of registering such securities. The presence of
      this
      additional number of ordinary shares eligible for trading in the public market
      may have an adverse effect on the market price of our ordinary shares. 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
      shareholders 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 ordinary shares.





***A
      market for our securities has only existed since January 16, 2008 and a market
      for our securities may not develop, which could adversely affect the liquidity
      and price of our securities.***





A
      market for
      our securities has only existed since January 16, 2008. Therefore, shareholders
      should be aware that they cannot benefit from information about prior market
      history as to their decisions to invest which means they are at further risk
      if
      they invest. In addition, the price of the securities, after the offering,
      can
      vary due to general economic conditions and forecasts, our general business
      condition and the release of our financial reports.





***The
      American Stock Exchange may delist our securities, which could limit investors’
ability to make transactions in our securities and subject us to additional
      trading restrictions.***





Although
      our securities are listed on the American Stock Exchange, we cannot assure
      you
      that we will be able to maintain that listing. Additionally, in connection
      with
      our business combination, it is likely that the American Stock Exchange may
      require us to file a new initial listing application and meet its initial
      listing requirements as opposed to its more lenient continued listing
      requirements. If we are unable to meet those stricter initial listing
      requirements, our securities would not be listed on the American Stock Exchange
      and might not be listed on any securities exchange.




33





If
      we are
      unable to maintain the listing of our securities on the American Stock Exchange,
      we could face significant material adverse consequences including:





·
            decreased
                trading liquidity and a limited availability of market quotations
                for our
                securities;


·
            a
                determination that our ordinary shares are “penny stock,” with the
                consequences described in “If our ordinary shares become 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 greatly reduced”;


·
            a
                limited amount of news and analyst coverage for our company;
                and





·
            a
                decreased ability to issue additional securities or obtain additional
                financing.




***If
      we are deemed to be an investment company, we may be required to institute
      burdensome compliance requirements and our activities may be restricted, which
      may make it difficult for us to complete a business combination.***





We
      may be
      deemed to be an investment company, as defined under Sections 3(a)(1)(A) and
      (C)
      of the Investment Company Act of 1940, as amended, because, following the
      offering and prior to the consummation of a business combination, we may be
      viewed as engaging in the business of investing in securities (in this case
      United States government securities as described below) having a value exceeding
      40% of our total assets. If we are deemed to be an investment company under
      the
      Investment Company Act of 1940, our activities may be restricted which, among
      other problems, may make it difficult for us to complete a business combination.
      Such restrictions include:





·
            restrictions
                on the nature of our investments;
                and





·
            restrictions
                on the issuance of securities.





In
      addition, we may have imposed upon us burdensome requirements,
      including:





·
            registration
                as an investment company;





·
            adoption
                of a specific form of corporate structure;
                and





·
            reporting,
                record keeping, voting, proxy and disclosure requirements and other
                rules
                and regulations.





However,
      we
      do not believe that our anticipated principal activities will subject us to
      the
      Investment Company Act of 1940. To this end, the proceeds held in trust may
      only
      be invested by the trust agent in “government securities” with specific maturity
      dates or in money market funds meeting certain conditions under Rule 2a-7
      promulgated under the Investment Company Act of 1940. By restricting the
      investment of the proceeds to these instruments, we intend to avoid being deemed
      an investment company within the meaning of the Investment Company Act of 1940.
      Our offering is not intended for persons who are seeking a return on investments
      in government securities. The trust account and the purchase of government
      securities for the trust account is intended as a holding place for funds
      pending the earlier to occur of either: (i) the consummation of our primary
      business objective, which is a business combination, or (ii) absent a business
      combination, our dissolution and return of the funds held in this trust account
      to our public shareholders as part of our automatic dissolution and liquidation.
      Notwithstanding our belief that we are not required to comply with the
      requirements of such act, we may be considered to be an investment company
      and
      thus required to comply with such act. If we were deemed to be subject to the
      act, compliance with these additional regulatory burdens would require
      additional expense that we have not allotted for.





***Currently,
      only one member of our board of directors is considered “independent” under the
      rules of the *American Stock Exchange*and, if we are unable to recruit
      additional independent directors within the timeframe specified in such rules,
      our securities may be delisted.***





As
      of the
      date of this report, we believe that only one of our directors, Stuart Sundlun,
      is “independent” as that term is defined in the Amex Company Guide. Rule 809(b)
      of the Amex Company Guide provides a phase-in schedule for companies listing
      on
      the exchange in conjunction with an initial public offering. Based on the
      schedule set out in this rule, we only need one independent director to serve
      on
      our audit, nominating and compensation committees at the closing of our offering
      and at the time of listing on the exchange. However, we must (i) within 90
      days
      after the closing of our offering, add at least one more independent director
      so
      as to have a majority on a three person audit and compensation committee; and
      (ii) within one year after the closing of our offering, add enough additional
      independent directors so that a majority of our board and 100% of the members
      of
      the audit and compensation committees are “independent”. We cannot assure you
      that we will be able to comply with the phase-in schedule set forth in Rule
      809(b). If we are unable to comply with Rule 809(b), the American Stock Exchange
      may delist our securities.





***Since
      we have not currently selected a prospective target business with which to
      complete a business combination, investors in our offering are unable to
      currently ascertain the merits or risks of the target business’ operations.***





Since
      we
      have not yet identified a prospective target, investors in our offering have
      no
      current basis to evaluate the possible merits or risks of the target business’
operations. To the extent we complete a business combination with a financially
      unstable company, an entity in its development stage and/or an entity subject
      to
      unknown or unmanageable liabilities, we may be affected by numerous risks
      inherent in the business operations of those entities. Although our management
      will endeavor to evaluate the risks inherent in a particular target business,
      we
      cannot assure you that we will properly ascertain or assess all of the
      significant risk factors. We also cannot assure you that an investment in our
      units will not ultimately prove to be less favorable to investors in our
      offering than a direct investment, if an opportunity were available, in a target
      business. For a more complete discussion of our selection of a target business,
      see the section entitled “Effecting a business combination — We have
      not identified a target business.”




34





***Since
      we are not an operating company, the pricing of the units in our offering is
      relatively arbitrary.***





Prior
      to
      our offering there has been no public market for any of our securities. The
      public offering price of the units and the terms of the warrants were negotiated
      between us and Maxim Group LLC. Factors considered in determining the prices
      and
      terms of the units, including the ordinary shares and warrants underlying the
      units, include:





·
            the
                history and prospects of companies whose principal business is the
                acquisition of other companies;





·
            prior
                offerings of those companies;





·
            our
                prospects for acquiring an operating business at attractive
                values;





·
            our
                capital structure;





·
            an
                assessment of our management and their experience in identifying
                operating
                companies;





·
            general
                conditions of the securities markets at the time of the offering;
                and





·
            other
                factors as were deemed relevant.





However,
      although these factors were considered, the determination of our offering price
      is more arbitrary than the pricing of securities for an operating company in
      a
      particular industry since the underwriters are unable to compare our financial
      results and prospects with those of public companies operating in the same
      industry.





***The
      inability of the sellers of companies we may acquire to fulfill their
      indemnification obligations to us under our acquisition agreements could
      increase our liabilities and adversely affect our results of operations and
      financial position.***





We
      intend
      to negotiate as a term of our acquisition agreements that the respective sellers
      will agree to retain responsibility for and indemnify us against damages
      resulting from certain third-party claims or other liabilities. However, there
      may be instances in which we determine to ultimately enter into an acquisition
      agreement without such seller indemnification obligations, such as in purchases
      of assets out of bankruptcy or purchases of certain hospitality-related assets.
      The lack of seller indemnification obligations or the failure of any seller
      to
      satisfy its obligations with respect to claims and retained liabilities covered
      by the acquisition agreements could have an adverse effect on our results of
      operations and financial position because claimants may successfully assert
      that
      we are liable for those claims and/or retained liabilities. In addition, we
      expect that certain obligations of the sellers to indemnify us will terminate
      upon expiration of the applicable indemnification period and will not cover
      damages in excess of the applicable coverage limit. The assertion of third-party
      claims after the expiration of the applicable indemnification period or in
      excess of the applicable coverage limit or the failure of any seller to satisfy
      its indemnification obligations with respect to breaches of its representations
      and warranties, could have an adverse effect on our results of operations and
      financial position.





**Risks
      of Doing Business in China and Vietnam**





***If
      we acquire control of a target business through contractual arrangements with
      one or more operating businesses in China or Vietnam, such contracts may not
      be
      as effective in providing operational control as direct ownership of such
      businesses and may be difficult to enforce.***





We
      will only
      acquire a business or businesses that, upon the completion of our initial
      business combination, will be our majority-owned subsidiaries and will be
      neither investment companies nor companies excluded from the definition of
      investment company by Sections 3(c)(1) or 3(c)(7) of the Investment Company
      Act
      of 1940. However, the governments of the PRC and Vietnam have restricted or
      limited foreign ownership of certain kinds of assets and companies operating
      in
      certain industries. The industry groups that are restricted are wide ranging,
      including certain aspects of telecommunications, advertising, food production,
      and heavy equipment manufacturers, for example. In addition there can be
      restrictions on the foreign ownership of businesses that are determined from
      time to time to be in “important industries” that may affect the national
      economic security in the PRC and Vietnam, or having “famous brand names” or
“well established brand names”. Subject to the review requirements of the
      Ministry of Commerce in the PRC and other relevant agencies in the PRC and
      Vietnam for acquisitions of assets and companies in the PRC and Vietnam and
      subject to the various percentage ownership limitations that exist from time
      to
      time, acquisitions involving foreign investors and parties in the various
      restricted categories of assets and industries may nonetheless sometimes be
      consummated using contractual arrangements with permitted Chinese or Vietnamese
      parties. To the extent that such agreements are employed, they may be for
      control of specific assets such as intellectual property or control of blocks
      of
      the equity ownership interests of a company which may not be subject to the
      merger and acquisition regulations mentioned above since these types of
      arrangements typically do not involve a change of equity ownership in a PRC
      or
      Vietnamese operating company, injure a third party or affect the social public
      interest. The agreements would be designed to provide our company with the
      economic benefits of and control over the subject assets or equity interests
      similar to the rights of full ownership, while leaving the technical ownership
      in the hands of Chinese or Vietnamese parties who would be our nominees and,
      therefore, may exempt the transaction from the merger and acquisition
      regulations, including the application process required thereunder. However,
      since there has been limited implementation guidance provided with respect
      to
      the merger and acquisition regulations, there can be no assurance that the
      relevant government agency would not apply them to a business combination
      effected through contractual arrangements. If such an agency determines that
      such an application should have been made consequences may include levying
      fines, revoking business and other licenses, requiring restructure of ownership
      or operations and requiring discontinuation of any portion of all of the
      acquired business. The agreements likely also would provide for increased
      ownership or full ownership and control by us when and if permitted under PRC
      or
      Vietnamese laws and regulations. If we choose to effect a business combination
      that employs the use of these types of control arrangements, we may have
      difficulty in enforcing our rights. Therefore these contractual arrangements
      may
      not be as effective in providing us with the same economic benefits, accounting
      consolidation or control over a target business as would direct ownership.
      For
      example, if the target business or any other entity fails to perform its
      obligations under these contractual arrangements, we may have to incur
      substantial costs and expend substantial resources to enforce such arrangements,
      and rely on legal remedies under Chinese or Vietnamese law, including seeking
      specific performance or injunctive relief, and claiming damages, which we cannot
      assure will be sufficient to off-set the cost of enforcement and may adversely
      affect the benefits we expect to receive from the business combination.




35





Moreover,
      we expect that the contractual arrangements upon which we would be relying
      would
      be governed by Chinese or Vietnamese law and would be the only basis of
      providing resolution of disputes which may arise through either arbitration
      or
      litigation in China or Vietnam. Accordingly, these contracts would be
      interpreted in accordance with Chinese or Vietnamese law and any disputes would
      be resolved in accordance with Chinese or Vietnamese legal procedures.
      Uncertainties in the Chinese or Vietnamese legal systems could limit our ability
      to enforce these contractual arrangements. In the event we are unable to enforce
      these contractual arrangements, we may not be able to exert the effective level
      of control or receive the full economic benefits of full direct ownership over
      the target business.





***Contractual
      arrangements we enter into with potential future subsidiaries and affiliated
      entities or acquisitions of offshore entities that conduct PRC or Vietnamese
      operations through affiliates in China or Vietnam may be subject to a high
      level
      of scrutiny by the PRC tax authorities.***





Under
      PRC
      and Vietnamese law, arrangements and transactions among related parties may
      be
      subject to audit or challenge by the PRC or Vietnamese tax authorities. If
      any
      of the transactions we enter into with potential future subsidiaries and
      affiliated entities are found not to be on an arm’s-length basis, or to result
      in an unreasonable reduction in tax under PRC or Vietnamese law, the PRC or
      Vietnamese tax authorities have the authority to disallow any tax savings,
      adjust the profits and losses of such possible future PRC or Vietnamese entities
      and assess late payment interest and penalties. A finding by the PRC or
      Vietnamese tax authorities that we are ineligible for any such tax savings,
      or
      that any of our possible future affiliated entities are not eligible for tax
      exemptions, would substantially increase our possible future taxes and thus
      reduce our net income and the value of your investment. In addition, in the
      event that in connection with an acquisition of an offshore entity that
      conducted its PRC or Vietnamese operations through affiliates in China or
      Vietnam, the sellers of such entities failed to pay any taxes required under
      PRC
      or Vietnamese law, the PRC or Vietnamese tax authorities could require us to
      withhold and pay the tax, together with late-payment interest and penalties.
      The
      occurrence of any of the foregoing could have a negative impact on our operating
      results and financial condition.





***If
      the PRC or Vietnamese government finds that the agreements in which we acquire
      control through contractual arrangements by establishing the structure for
      operating our China or Vietnamese businesses do not comply with PRC or
      Vietnamese governmental restrictions on foreign investment, or if these
      regulations or the interpretation of existing regulations change in the future,
      we could be subject to significant penalties or be forced to relinquish our
      interests in those operations.***





PRC
      and/or Vietnamese regulations currently prohibit or restrict foreign ownership
      in certain “important industries,” including telecommunications, advertising,
      food production and heavy equipment. There are uncertainties under PRC and/or
      Vietnamese regulations whether obtaining a majority interest through contractual
      arrangements will comply with regulations prohibiting or restricting foreign
      ownership in certain industries. For example, the PRC may apply restrictions
      in
      other industries in the future. In addition, there can be restrictions on the
      foreign ownership of businesses that are determined from time to time to be
      in
“important industries” that may affect the national economic security or those
      in the PRC having “famous Chinese brand names” or “well established Chinese
      brand names.”




36





If
      we or any
      of our potential future subsidiaries or affiliated entities are found to be
      in
      violation of any existing or future PRC or Vietnamese laws or regulations (for
      example, if we are deemed to be holding equity interests in certain of our
      affiliated entities in which direct foreign ownership is prohibited) the
      relevant PRC or Vietnamese regulatory authorities might have the discretion
      to:





**·**
            revoke
                the business and operating licenses of possible future PRC or Vietnamese
                subsidiaries or affiliates;





**·**
            confiscate
                relevant income and impose fines and other
                penalties;





**·**
            discontinue
                or restrict possible future PRC or Vietnamese subsidiaries’ or affiliates’
                operations;





**·**
            require
                us or possible future PRC or Vietnamese subsidiaries or affiliates
                to
                restructure the relevant ownership structure or
                operations;





**·**
            restrict
                or prohibit our use of the proceeds of our offering to finance our
                businesses and operations in China or Vietnam;
                or





**·**
            impose
                conditions or requirements with which we or possible future PRC or
                Vietnamese subsidiaries or affiliates may not be able to
                comply.





The
      imposition of any of these penalties could result in a material and adverse
      effect on our ability to conduct our business.





In
      addition, the relevant PRC or Vietnamese regulatory authorities may impose
      further penalties. Any of these consequences could have a material and adverse
      effect on our operations.





In
      many
      cases, existing regulations with regard to investments from foreign investors
      and domestic private capital lack detailed explanations and operational
      procedures, and are subject to interpretation, which may change over time.
      We
      thus cannot be certain how the regulations will be applied to our business,
      either currently or in the future. Moreover, new regulations may be adopted
      or
      the interpretation of existing regulations may change, any of which could result
      in similar penalties, resulting in a material and adverse effect on our ability
      to conduct our business.





***Potential
      future PRC or Vietnamese targets or strategic partners may have previously
      engaged or may engage in activities without appropriate licenses or approvals
      or
      outside the authorized scope of their business licenses or permitted activities.
      This could subject those companies to fines and other penalties, which could
      have a material adverse effect on our business.***





Potential
      future targets or strategic partners may have previously engaged or may
      currently engage in activities without appropriate licenses or approvals or
      outside the authorized scope of their business licenses or permitted activities.
      If we or our strategic partners do not receive any necessary licenses or
      approvals, broaden the authorized business scope or narrow the scope of the
      activities as appropriate, we or the relevant strategic partner may have to
      cease operations or contract our operations to third parties who hold the
      appropriate licenses. In addition, counterparties to contracts we make when
      engaging in activities that require licenses may legally default on those
      contracts if we or the relevant strategic partner do not possess the appropriate
      licenses. The occurrence of any of these events would have an adverse effect
      on
      our business and results of operations.





PRC
      or
      Vietnamese authorities may refuse to grant any licenses we may seek. For
      companies that exceeded the scope of their business licenses or permitted
      activities or operated without a license or needed approval in the past but
      are
      now compliant, as well as for any companies that may currently operate without
      the appropriate license or approval or outside the scope of their business
      license or permitted activities, the relevant PRC or Vietnamese authorities
      have
      the authority to impose fines or other penalties, sometimes as much as five
      to
      ten times the amount of the illegal revenues and may require the disgorgement
      of
      profits or revocation of the business license. Due to the inconsistent nature
      of
      regulatory enforcements in the PRC or Vietnam, those of our possible future
      PRC
      or Vietnamese strategic partners that exceeded the scope of their business
      licenses or permitted activities or operated without the appropriate licenses
      or
      approvals in the past or do so in the future may be subject to the above fines
      or penalties, including the disgorgement of profits or revocation of the
      business license of one or more of these companies. These fines or penalties
      may
      have a material adverse effect on our business.





***As
      a result of merger and acquisition regulations which became effective on
      September 8, 2006 relating to acquisitions of assets and equity interests of
      Chinese companies by foreign persons, it is expected that acquisitions will
      take
      longer and be subject to economic scrutiny by the PRC government authorities
      such that we may not be able to complete a transaction, negotiate a transaction
      that is acceptable to our stockholders, or sufficiently protect shareholder’s
      interests in a transaction.***





On
      August
      8, 2006, six PRC regulatory agencies, namely, the Ministry of Commerce (MOFCOM),
      the State Assets Supervision and Administration Commission (SASAC), the State
      Administration for Taxation, the State Administration for Industry and Commerce
      (SAIC), the China Securities Regulatory Committee (CSRC), and the PRC State
      Administration of Foreign Exchange (SAFE), jointly adopted the Regulations
      on
      Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, which
      became effective on September 8, 2006 (M&A Rules). These comprehensive rules
      govern the approval process by which a Chinese company may participate in an
      acquisition of its assets or its equity interests and by which a Chinese company
      may obtain public trading of its securities on a securities exchange outside
      the
      PRC.




37





Although
      prior to September 8, 2006 there was a complex series of regulations
      administered by a combination of provincial and centralized agencies in place
      for acquisition approval of Chinese enterprises by foreign investors, the
      M&A Rules have largely centralized and expanded the approval process to
      MOFCOM, SAIC, SAFE or its branch offices, SASAC, and the CSRC. The M&A Rules
      established, among other things, additional procedures and requirements that
      could make merger and acquisition activities by foreign investors more
      time-consuming and complex, including requirements in some instances that the
      MOFCOM be notified in advance when a foreign investor acquires equity or assets
      of a PRC domestic enterprise. Complying with the requirements of the M&A
      Rules to complete such transactions could be time-consuming, and any required
      approval processes, including obtaining approval from the MOFCOM, may delay
      or
      inhibit our ability to complete such transactions, which could affect our
      ability to expand our business or maintain our market share.





Depending
      on the structure of the transaction, these regulations will require the Chinese
      parties to make a series of applications and supplemental applications to the
      aforementioned agencies, some of which must be made within strict time limits
      and require approvals from one or more of the aforementioned agencies. The
      application process has been supplemented to require the presentation of
      economic data concerning a transaction, introducing aspects of economic and
      substantive analysis of the target business and the acquirer and the terms
      of
      the transaction by MOFCOM and the other governing agencies as well as an
      evaluation of compliance with legal requirements. The application process for
      approval now includes submissions of an appraisal report, an evaluation report
      and the acquisition agreement, depending on the structure of the transaction.
      An
      employee settlement plan for the target company shall also be included in the
      application.





The
      M&A Rules also prohibit a transaction at an acquisition price obviously
      lower than the appraised value of the Chinese business or assets. The
      regulations require that in certain transaction structures, the consideration
      must be paid within strict time periods, generally not in excess of a year.
      Because the Chinese authorities have been concerned with offshore transactions
      which converted domestic companies into foreign investment enterprises (FIEs)
      in
      order to take advantage of certain benefits, including reduced taxation, in
      China, the M&A Rules require new foreign sourced capital of not less than
      25% of the domestic company’s post-acquisition capital in order to obtain FIE
      treatment. Accordingly, if a sufficient amount of foreign capital is not infused
      into the domestic company, it will not be eligible to obtain FIE treatment.
      In
      the agreement reached by the foreign acquirer, target, creditors and other
      parties, there must be no harm to third parties and the public interest in
      the
      allocation of assets and liabilities being assumed or acquired. These aspects
      of
      the regulations will limit our ability to negotiate various terms of the
      acquisition, including aspects of the initial consideration, contingent
      consideration, holdback provisions, indemnification provisions and provisions
      relating to the assumption and allocation of assets and liabilities. Therefore,
      we may not be able to negotiate a transaction with terms that will satisfy
      our
      investors and protect our stockholders interests in an acquisition of a Chinese
      business or assets.





It
      is
      expected that compliance with the regulations will be more time consuming than
      in the past, will be more costly for the Chinese parties and will permit the
      government much more extensive evaluation and control over the terms of the
      transaction. Therefore, acquisitions in China may not be able to be completed
      because the terms of the transaction may not satisfy aspects of the approval
      process and may not be completed, even if approved, if they are not consummated
      within the time permitted by the approvals granted.





***If
      the PRC or Vietnam do not continue their policy of economic reforms, it could,
      among other things, result in an increase in tariffs and trade restrictions
      on
      products we ultimately produce or sell following a business combination.***





The
      PRC
      and Vietnamese governments have been reforming their economic systems. The
      economies of the PRC and Vietnam have historically been nationalistic, “planned
      economies,” meaning they have functioned and produced according to governmental
      plans and pre-set targets or quotas. However, in recent years, the PRC and
      Vietnamese governments have implemented measures emphasizing the utilization
      of
      market forces for economic reform and the reduction of state ownership in
      business enterprises. Although we believe that the changes adopted by the PRC
      and Vietnamese governments have had a positive effect on the economic
      development of each country, additional changes are still needed to be made.
      For
      example, a substantial portion of productive assets in the PRC and Vietnam
      are
      still owned by the government. Additionally, the government continues to play
      a
      significant role in regulating industrial development. We cannot predict the
      timing or extent of any future economic reforms that may be proposed.





A
      recent
      positive economic change has been the PRC’s entry into the World Trade
      Organization, the sole global international organization dealing with the rules
      of trade between nations. It is believed that the PRC’s entry will ultimately
      result in a reduction on tariffs for industrial products, a reduction in trade
      restrictions and an increase in trading with the United States. However, the
      PRC
      has not fully complied with all of its WTO obligations to date, including fully
      opening its markets to American goods and easing the current trade imbalance
      between the two countries. If actions are not taken to rectify these problems,
      trade relations may be strained and this may have a negative impact on China’s
      economy.




38





***If
      relations between the United States and the PRC or Vietnam deteriorate, it
      could
      cause potential target businesses or their goods or services to become less
      attractive.***





The
      relationship between the United States and the PRC or Vietnam is subject to
      sudden fluctuation and periodic tension. For instance, the United States
      recently announced its intention to impose new short-term quotas on Chinese
      clothing imports, which may be extended for several years. Such import quotas
      may adversely affect political relations between the two countries and result
      in
      retaliatory countermeasures by the PRC in industries that may affect our
      ultimate target business. Relations may also be compromised if the U.S. becomes
      a more vocal advocate of Taiwan or proceeds to sell certain military weapons
      and
      technology to Taiwan. Changes in political conditions in the PRC or Vietnam
      and
      changes in the state of relations with the U.S. are difficult to predict and
      could adversely affect our operations or cause potential target businesses
      or
      their goods and services to become less attractive. Because we are not limited
      to any specific industry, there is no basis for investors in our offering to
      evaluate the possible extent of any impact on our ultimate operations if
      relations are strained between the PRC or Vietnam and the United States.





***If
      the PRC or Vietnam impose restrictions to reduce inflation, future economic
      growth in the PRC or Vietnam could be severely curtailed, which could lead
      to a
      significant decrease in our profitability following a business combination.***





While
      the
      economies of the PRC and Vietnam have experienced rapid growth, this growth
      has
      been uneven among various sectors of the economy and in different geographical
      areas of each country. Rapid economic growth can lead to growth in the supply
      of
      money and rising inflation. If prices for the products of our ultimate target
      business rise at a rate that is insufficient to compensate for the rise in
      the
      costs of supplies, it may have an adverse effect on profitability. In order
      to
      control inflation in the past, the PRC and Vietnam have imposed controls on
      bank
      credits, limits on loans for fixed assets and restrictions on state bank
      lending. If similar restrictions are imposed, it may lead to a slowing of
      economic growth. Because we are not limited to any specific industry, the
      ultimate industry that we operate in may be effected more severely by such
      a
      slowing of economic growth.





***Any
      devaluation of currencies used in the PRC or Vietnam could negatively impact
      our
      target business’ results of operations and could cause the cost of a target
      business as measured in dollars to increase.***





Because
      our objective is to acquire control a target business having its primary
      operating facilities located in Asia, including the PRC or Vietnam, and because
      substantially all revenues and income would be received in a foreign currency
      such as Renminbi or Dong, the main currency used in the PRC and Vietnam,
      respectively, the dollar equivalent of our net assets and distributions, if
      any,
      would be adversely affected by reductions in the value of the Renminbi or Dong.
      The value of the Renminbi and Dong fluctuates and is affected by, among other
      things, changes in the PRC’s and Vietnam’s political and economic conditions. In
      the PRC, for example, the conversion of Renminbi into foreign currencies such
      as
      the dollar has been generally based on rates set by the People’s Bank of China,
      which are set daily based on the previous day’s interbank foreign exchange
      market rates and current exchange rates on the world financial markets. The
      official exchange rate has remained stable over the past several years. However,
      any devaluation may materially and adversely affect a target business. Recently,
      the United States and other nations have been pressing China to increase the
      value of the Renminbi against the dollar and other currencies. If the Renminbi
      or Dong appreciates in value against the dollar prior to the consummation of
      a
      business combination, the cost of a target business as measured in dollars
      will
      increase.





***Because
      Chinese or Vietnamese law will govern almost all of any target business material
      agreements, we may not be able to enforce our rights within the PRC or Vietnam,
      or elsewhere, which could result in a significant loss of business, business
      opportunities or capital.***





Chinese
      or Vietnamese law will govern almost all of our target business’ material
      agreements, many of which may be with Chinese or Vietnamese governmental
      agencies. We cannot assure you that the target business will be able to enforce
      any of its material agreements or that remedies will be available outside of
      the
      PRC or Vietnam. The system of laws and the enforcement of existing laws in
      the
      PRC or Vietnam may not be as certain in implementation and interpretation as
      in
      the United States. The Chinese and Vietnamese judiciary is relatively
      inexperienced in enforcing corporate and commercial law, leading to a higher
      than usual degree of uncertainty as to the outcome of any litigation. In
      addition, to the extent that our target business’ material agreements are with
      Chinese or Vietnamese governmental agencies, we may not be able to enforce
      or
      obtain a remedy from such agencies due to sovereign immunity, in which the
      government is deemed to be immune from civil lawsuit or criminal prosecution.
      The inability to enforce or obtain a remedy under any of our future agreements
      could result in a significant loss of business, business opportunities or
      capital.





Additionally,
      some of our directors and officers reside outside of the United States and,
      after the consummation of a business combination, substantially all of our
      assets will be located outside of the United States. As a result, it may not
      be
      possible for investors in the United States to enforce their legal rights,
      to
      effect service of process upon our directors or officers or to enforce judgments
      of United States courts predicated upon civil liabilities and criminal penalties
      of our directors and officers under Federal securities laws. Moreover, we have
      been advised that the PRC does not have treaties providing for the reciprocal
      recognition and enforcement of judgments of courts with the United States.
      Further, it is unclear if extradition treaties now in effect between the United
      States and the PRC would permit effective enforcement of criminal penalties
      of
      the Federal securities laws.




39





***Many
      industries in China and Vietnam, including the leisure and hospitality and
      financial services industries, are subject to government regulations that limit
      or prohibit foreign investments in such industries, which may limit the
      potential number of acquisition candidates or our ability to grow and sustain
      such business which may require us to seek additional financing.***





The
      Chinese and Vietnamese governments have imposed regulations in various
      industries, including the leisure and hospitality and financial services
      industries, that would limit foreign investors’ equity ownership or prohibit
      foreign investments altogether in companies that operate in such industries.
      As
      a result, the number of potential acquisition candidates available to us may
      be
      limited or our ability to grow and sustain the business which we will ultimately
      operate will be adversely affected. In such event, we may be required to seek
      additional financing which may not be available on terms acceptable to us or
      at
      all.





***Exchange
      controls that exist in the PRC may limit our ability to utilize our cash flow
      effectively following a business combination.***





Following
      a business combination, we will be subject to the PRC’s rules and regulations on
      currency conversion. In the PRC, the State Administration for Foreign Exchange
      (SAFE) regulates the conversion of the Renminbi into foreign currencies. The
      principal regulation governing foreign currency exchange in China is the Foreign
      Currency Administration Rules (1996), as amended. Under these rules and
      regulations, significant restrictions still remain, including primarily the
      restriction that foreign invested enterprises may only buy, sell and/or remit
      foreign currencies at those banks authorized to conduct foreign exchange
      business after providing valid commercial documents. In addition, conversion
      of
      RMB for capital account items, including direct investment and loans, is subject
      to governmental approval in China, and companies are required to open and
      maintain separate foreign exchange accounts for capital account items.
      Currently, foreign investment enterprises (FIEs) are required to apply to the
      SAFE for “Foreign Exchange Registration Certificates for FIEs.” Following a
      business combination, we will likely be an FIE as a result of our ownership
      structure. With such registration certificates, which need to be renewed
      annually, FIEs are allowed to open foreign currency accounts including a “basic
      account” and “capital account.” Currency translation within the scope of the
“basic account,” such as remittance of foreign currencies for payment of
      dividends, can be effected without requiring the approval of the SAFE. However,
      conversion of currency in the “capital account,” including capital items such as
      direct investment, loans and securities, still require approval of the SAFE.
      We
      cannot assure you that the PRC regulatory authorities will not impose further
      restrictions on the convertibility of the Renminbi. Any future restrictions
      on
      currency exchanges may limit our ability to use our cash flow for the
      distribution of dividends to our shareholders or to fund operations we may
      have
      outside of the PRC.





***If
      certain exemptions within the PRC regarding withholding taxes are removed,
      we
      may be required to deduct Chinese corporate withholding taxes from dividends
      we
      may pay to our shareholders following a business combination.***





Under
      the
      PRC’s current tax laws, regulations and rulings, companies are exempt from
      paying withholding taxes with respect dividends paid to shareholders outside
      of
      the PRC. However, if the foregoing exemption is removed in the future following
      a business combination, we may be required to deduct certain amounts from
      dividends we may pay to our shareholders to pay corporate withholding taxes.
      The
      current rate imposed on corporate withholding taxes is 20%, or 10% for
      individuals and entities for those countries that entered into the Protocol
      of
      Avoidance of double taxation within the PRC. Changes in tax laws or the
      interpretation of tax laws by the government of the PRC could significantly
      impact our return to our investors.





***If
      the United States imposes trade sanctions on the PRC due to its current currency
      policies, our target business’ ability to succeed in the international markets
      may be diminished.***





The
      PRC
      currently “pegs” its currency to the United States dollar. This means that each
      unit of Chinese currency has a set ratio for which it may be exchanged for
      United States currency, as opposed to having a floating value like other
      countries’ currencies. This policy is currently under review by policy makers in
      the United States. Trade groups in the United States have blamed the cheap
      value
      of the Chinese currency for causing job losses in American factories, giving
      exporters an unfair advantage and making its imports expensive. There is
      increasing pressure for the PRC to change its currency policies to provide
      for
      its currency to float freely on international markets, although the PRC has
      not
      indicated any intention to change its current policies. As a result, Congress
      is
      considering the enactment of a bill that would require the United States
      treasury secretary to report to Congress whether the PRC is manipulating its
      currency to gain a trade advantage. If Congress deems this to be the case,
      tariffs would be imposed on Chinese imports in addition to those already in
      force. If an additional tariff is imposed, it is possible that China-based
      companies will no longer maintain significant price advantages over foreign
      companies, including the United States, on their goods and services. If the
      PRC
      is pressured to change its existing currency policies or if the United States
      or
      other countries enact laws to penalize the PRC for its existing currency
      policies, our target companies are likely to be adversely affected since the
      current competitive advantages that exist as a result of existing currency
      policies will cease.




40





***Doing
      business in China or Vietnam involves various risks including internal and
      international political risks, evolving national economic policies as well
      as
      financial accounting standards, expropriation and the potential for a reversal
      in economic conditions.***





We
      may
      acquire control of one or more businesses located in the Peoples Republic of
      China or Vietnam. The governments of the Peoples Republic of China and Vietnam
      have been reforming their respective economic systems. These reforms have
      resulted in significant economic growth and social progress. These policies
      and
      measures may from time to time be modified or revised. Adverse changes in
      economic policies of the Chinese or Vietnamese governments or in the laws and
      regulations, if any, could have a material adverse effect on the overall
      economic growth of China or Vietnam and could adversely affect our business
      operations.





***Fluctuations
      in the exchange rate between the Chinese or Vietnamese currency and the United
      States dollar could adversely affect our operating results.***





The
      functional currency of our operations in China and Vietnam would be “Renminbi”
and “Dong”, respectively. However, results of our operations are translated at
      average exchange rates into United States dollars for purposes of reporting
      results. As a result, fluctuations in exchange rates may adversely affect our
      expenses and results of operations as well as the value of our assets and
      liabilities. Fluctuations may adversely affect the comparability of
      period-to-period results. Although we may use hedging techniques in the future
      (which we currently do not use), we may not be able to eliminate the effects
      of
      currency fluctuations. Thus, exchange rate fluctuations could cause our profits,
      and therefore our stock prices, to decline.





For
      example, in order for our China subsidiaries to pay dividends to us, a
      conversion of Renminbi into U.S. dollars is required which, if we were not
      allowed by the Chinese government, would cause an interruption in our operating
      cash flow. Under current Chinese law, the conversion of Renminbi into foreign
      currency generally requires government consent. Government authorities may
      impose restrictions that could have a negative impact in the future on the
      conversion process and upon our ability to meet our cash needs, and to pay
      dividends to our shareholders. Although, our subsidiaries’ classification as
      wholly owned foreign enterprises (“WOFEs”) under Chinese law permits them to
      declare dividends and repatriate their funds to us in the United States, any
      change in this status or the regulations permitting such repatriation could
      prevent them from doing so. Any inability to repatriate funds to us would in
      turn prevent payments of dividends to our shareholders.





***The
      Chinese currency, “Renminbi”, is not a freely convertible currency, which could
      limit our ability to obtain sufficient foreign currency to support our business
      operations in the future.***





If
      we
      effect a business combination in Hong Kong or on the Chinese mainland, we will
      likely rely on the Chinese government’s foreign currency conversion policies,
      which may change at any time, in regard to our currency exchange needs. If
      we
      receive substantially all of our revenues in Renminbi, this currency is not
      freely convertible into other foreign currencies. In China, the government
      has
      control over Renminbi reserves through, among other things, direct regulation
      of
      the conversion of Renminbi into other foreign currencies and restrictions on
      foreign imports. Although foreign currencies which are required for “current
      account” transactions can be bought freely at authorized Chinese banks, the
      proper procedural requirements prescribed by Chinese law must be met. At the
      same time, Chinese companies are also required to sell their foreign exchange
      earnings to authorized Chinese banks and the purchase of foreign currencies
      for
      capital account transactions still requires prior approval of the Chinese
      government. This type of heavy regulation by the Chinese government of foreign
      currency exchange restricts certain of our business operations and a change
      in
      any of these government policies, or any other, could further negatively impact
      our operations which could result in a loss of profits.





**Risks
      of Doing Business in Japan, South Korea, Australia and New
      Zealand**





***Any
      devaluation of currencies used in Japan, South Korea, Australia or New Zealand
      could negatively impact our target business’ results of operations and could
      cause the cost of a target business as measured in dollars to increase.***





Because
      our objective is to acquire control of a target business having its primary
      operating facilities located in Asia, including Japan, South Korea, Australia
      and New Zealand, and because substantially all revenues and income would be
      received in a foreign currency such as Yen, Won, or the Australian or New
      Zealand dollar, the main currency used in Japan, South Korea, Australia and
      New
      Zealand, respectively, the dollar equivalent of our net assets and
      distributions, if any, would be adversely affected by reductions in the value
      of
      the Yen, Won, or the Australian or New Zealand dollar. The value of the Yen,
      Won, or the Australian or New Zealand dollar fluctuates and is affected by,
      among other things, changes in Japan’s, South Korea’s, Australia’s or New
      Zealand’s political and economic conditions. Any devaluation of such currencies
      may materially and adversely affect a target business. If the Yen, Won, or
      the
      Australian or New Zealand dollar appreciates in value against the dollar prior
      to the consummation of a business combination, the cost of a target business
      as
      measured in dollars will increase.




41





***Because
      Japanese, South Korean, Australian or New Zealand law will govern almost all
      of
      any target business’ material agreements, we may not be able to enforce our
      rights within Japan, South Korea, Australia or New Zealand, or elsewhere, which
      could result in a significant loss of business, business opportunities or
      capital.***





Japanese,
      South Korean, Australian or New Zealand law will govern almost all of our target
      business’ material agreements, many of which may be with Japanese, South Korean,
      Australian or New Zealand governmental agencies. We cannot assure you that
      the
      target business will be able to enforce any of its material agreements or that
      remedies will be available outside of Japan, South Korea, Australia or New
      Zealand. The system of laws and the enforcement of existing laws in Japan,
      South
      Korea, Australia or New Zealand may not be as certain in implementation and
      interpretation as in the United States. To the extent that our target business’
material agreements are with Japanese, South Korean, Australian or New Zealand
      governmental agencies, we may not be able to enforce or obtain a remedy from
      such agencies due to sovereign immunity, in which the government is deemed
      to be
      immune from civil lawsuit or criminal prosecution. The inability to enforce
      or
      obtain a remedy under any of our future agreements could result in a significant
      loss of business, business opportunities or capital.





***Fluctuations
      in the exchange rate between the Japanese, South Korean, Australian or New
      Zealand currency and the United States dollar could adversely affect our
      operating results.***





The
      functional currency of our operations in Japan, South Korea, Australia and
      New
      Zealand would be “Yen”, “Won”, and the Australian and New Zealand dollar,
      respectively. However, results of our operations are translated at average
      exchange rates into United States dollars for purposes of reporting results.
      As
      a result, fluctuations in exchange rates may adversely affect our expenses
      and
      results of operations as well as the value of our assets and liabilities.
      Fluctuations may adversely affect the comparability of period-to-period results.
      Although we may use hedging techniques in the future (which we currently do
      not
      use), we may not be able to eliminate the effects of currency fluctuations.
      Thus, exchange rate fluctuations could cause our profits, and therefore our
      stock prices, to decline.





**Risks
      Related to the Leisure, Hospitality, Real Estate and Related
      Industries**





***Acts
      of terrorism and war could have an adverse effect on our target industries,
      which in turn could adversely affect our business.***





The
      transportation, leisure and hospitality industries are sensitive to safety
      and
      security concerns, and thus declines after occurrences of and fears of future
      incidents of terrorism and hostilities that affect the safety, security and
      confidence of travelers and users of hotels and related amenities and services.
      For example, the start of the war in Iraq in March 2003 and the terrorist
      attacks of September 11, 2001, which included attacks on the World Trade Center
      and the Pentagon using hijacked commercial aircraft, resulted in the
      cancellation of significant number of flights and travel bookings and a decrease
      in new travel bookings. Our future revenues and results of operations may be
      reduced or otherwise negatively affected by similar and/or other acts of
      terrorism or war. The effects of these events could include, among other things,
      a protracted decrease in demand for air travel due to fears regarding additional
      acts of terrorism, military and governmental responses to acts of terrorism
      and
      a perceived inconvenience in traveling by air and increased costs and reduced
      operations by airlines due, in part, to new safety and security directives
      adopted by the Federal Aviation Administration or other governmental agencies
      all of which, among other possibilities, could affect the hospitality industry.
      In addition, we cannot assure you that we will be able to insure against the
      risk associated with acts of terrorism.





***We
      will be subject to all the operating risks common to the hospitality industry.***





Operating
      risks common to the hospitality industry include:





·
            changes
                in general economic conditions and the prospects for improved performance
                in other parts of the world;


·
            consumers’
                fears of exposures to contagious diseases or the occurrence of natural
                disasters;


·
            consumer
                reluctance to spend on luxury items;


·
            decreases
                in the demand for transient rooms and related lodging services, including
                a reduction in business and vacation travel as a result of general
                economic conditions;


·
            cyclical
                over-building in the hotel and vacation ownership
                industries;


·
            restrictive
                changes in zoning and similar land use laws and regulations or in
                health,
                safety and environmental laws, rules and regulations and other
                governmental and regulatory action;


·
            changes
                in operating costs including, but not limited to, energy, labor costs
                and
                health-care related costs, insurance and unanticipated costs such
                as acts
                of nature and their consequences; and


·
            disputes
                with owners of properties and franchisees which may result in
                litigation.





42




***The
      hospitality industry is highly competitive, both for acquisitions of new hotels
      and other properties, for related amenity and service companies and for
      consumers.***





We
      will
      be competing for hotel and related property or business acquisition
      opportunities with others who have substantially greater financial resources
      than we do. These competitors may be prepared to accept a higher level of
      financial risk than we can prudently manage. This competition may have the
      effect of reducing the number of suitable opportunities offered to us and
      increasing our acquisition costs by enhancing the bargaining power of property
      owners seeking to sell or to enter into management agreements. Competitive
      factors in the hospitality industry include convenience of location, the quality
      of the property, room rates, the range and quality of food services and
      amenities offered and name recognition. Demographic, geographic or other changes
      in one or more markets of our target business could impact the convenience
      or
      desirability of its hotels, amenities or services and so could adversely affect
      their operations. Also, new or existing competitors could significantly lower
      rates or offer greater conveniences, services or amenities, or significantly
      expand, improve or introduce new facilities in the markets in which our target
      business’ hotels compete.





***If
      we acquire control of a target business in the gaming industry and are unable
      to
      comply with governmental regulations affecting the gaming industry, it could
      negatively affect our operations.***





We
      may
      acquire control of a target business in an industry related to hospitality
      such
      as the gaming industry. The gaming industry is highly regulated, and we would
      need to maintain licenses and pay gaming taxes to conduct such operations.
      Casinos are subject to extensive regulation under the laws, rules and
      regulations of the jurisdiction where they are located. These laws, rules and
      regulations generally concern the responsibility, financial stability and
      character of the owners, managers, and persons with financial interests in
      the
      gaming operations. Violations of laws in one jurisdiction could result in
      disciplinary action in other jurisdictions.





In
      addition to gaming regulations, our businesses may be subject to various laws
      and regulations in the jurisdictions in which they operate. These laws and
      regulations may include, but are not limited to, restrictions and conditions
      concerning environmental matters and taxation. Such laws and regulations could
      change or could be interpreted differently in the future, or new laws and
      regulations could be enacted. Material changes, new laws or regulations or
      material difference in interpretations by courts or governmental authorities
      could adversely affect our operating results.





***We
      may be subject to risks relating to real estate investments.***





We
      could
      be subject to the risks that generally relate to investments in real property
      because we may enter into a business combination with a target business that
      owns and leases hotels, resorts and other properties. The investment returns
      available from equity investments in real estate depend in large part on the
      amount of income earned and capital appreciation generated by the related
      properties, and the expenses incurred. In addition, a variety of other factors
      affect income from properties and real estate values, including governmental
      regulations, real estate, insurance, zoning, tax and eminent domain laws,
      interest rate levels and the availability of financing. For example, new or
      existing real estate zoning or tax laws can make it more expensive and/or
      time-consuming to develop real property or expand, modify or renovate hotels.
      When interest rates increase, the cost of acquiring, developing, expanding
      or
      renovating real property increases and real property values may decrease as
      the
      number of potential buyers decreases. Similarly, as financing becomes less
      available, it becomes more difficult both to acquire and to sell real property.
      Finally, under eminent domain laws, governments can take real property.
      Sometimes this taking is for less compensation than the owner believes the
      property is worth. Any of these factors could have a material adverse impact
      on
      our results of operations or financial condition. In addition, if our properties
      do not generate revenue sufficient to meet operating expenses, including debt
      service and capital expenditures, our income will be adversely
      affected.




***Our
      operations could be negatively affected if we are unable to manage the timing,
      budgeting and other risks associated with hotel, resort or golf course
      development or conversion of properties.***





Our
      target business may develop hotel, resort or golf course properties or convert
      properties to different uses, as suitable opportunities arise, taking into
      consideration the general economic climate. New project development and
      conversion of properties have a number of risks, including risks associated
      with:





·
            construction
                delays or cost overruns that may increase project
                costs;


·
            receipt
                of zoning, occupancy and other required governmental permits and
                authorizations;


·
            environmental
                issues with respect to development or conversion of properties such
                as
                golf courses;


·
            development
                costs incurred for projects that are not pursued to
                completion;


·
            so-called
                acts of God such as earthquakes, hurricanes, tsunamis, floods or
                fires
                that could adversely impact a project;


·
            defects
                in design or construction that may result in additional costs to
                remedy or
                require all or a portion of a property to be closed during the period
                required to rectify the situation; and


·
            governmental
                restrictions on the nature or size of a project or timing of
                completion.





43


We
      cannot
      assure you that any development project will be completed on time or within
      budget.





***Our
      financial condition could be negatively affected if we fail to maintain
      satisfactory labor relations.***





There
      will be costs associated with operations which are staffed by organized labor.
      Because of the higher labor costs and the increased risk of strikes and other
      work-related stoppages that may be associated with union or other organized
      operations in the hospitality sector, non-unionized competitors may have a
      competitive advantage in areas where they compete with unionized operations.
      To
      the extent we acquire control of non-union operations which subsequently become
      unionized, we could incur an increased risk of work stoppages, reduced
      productivity and higher labor costs. Work stoppages or strikes could adversely
      affect our operations or increase our costs.





***We
      will be subject to the risks associated with trends in consumer and business
      travel.***





If
      we
      affect a business combination in the hospitality industry, we will likely rely
      in large part on trends in U.S. and international business and consumer travel.
      Travel is highly sensitive to business and personal discretionary spending
      levels and tends to decline during general economic downturns. In addition,
      other adverse trends or events that tend to reduce travel could reduce our
      revenues or otherwise negatively affect our results of operations. These may
      include:





·
            price
                escalation in the airline industry or other travel-related industries
                due
                to increased fuel costs or other factors;


·
            occurrence
                of travel-related accidents and concerns about passenger convenience
                and
                safety;


·
            advances
                in business technology and communication, such as videoconferencing
                and
                online teleconferencing;


·
            health-related
                fears; and


·
            bad
                weather.





**Risks
      Related to the Financial Services Industry**





***We
      may be subject to significant regulatory requirements in connection with our
      efforts to consummate a business combination with a financial services firm,
      which may result in our failure to consummate our initial business combination
      within the required time frame and may force us to liquidate.***





Acquisitions
      of financial services companies are often subject to significant regulatory
      requirements and consents, and we will not be able to consummate a business
      combination with certain types of financial services companies without complying
      with applicable laws and regulations and obtaining required governmental or
      client consents. For example, if we were to attempt to acquire control of an
      investment management firm, we would have to obtain consents of the firm’s
      investment management clients or enter into new contracts with them, and there
      is no assurance that we would be able to obtain such consents or enter into
      new
      contracts. Further, if any such firm were located or had clients in a
      jurisdiction in which such industry is heavily regulated, we would bear the
      expense of compliance with such regulation. Similarly, if we were to attempt
      to
      acquire equity interests in certain banks, we would be required to obtain the
      approvals of the banking authority in the jurisdictions in which such banks
      were
      located or operated. If our acquisition target were an insurance company,
      similar restrictions may apply. In any of these circumstances, such regulatory
      authority could prevent us from completing our acquisition. The acquisition
      of a
      business in other sectors of the financial services industry may require similar
      approvals or consents.





We
      may
      not receive any such required approvals or we may not receive them in a timely
      manner, including as a result of factors or matters beyond our control.
      Satisfying any requirements of regulatory agencies may delay the date of our
      completion of our initial business combination beyond the required time frame
      (18 months after the consummation of our offering or 24 months after the
      consummation of our offering if a letter of intent, agreement in principle
      or a
      definitive agreement has been executed within 18 months after the consummation
      of our offering and the initial business combination relating thereto has not
      yet been consummated within such 18-month period). If we fail to consummate
      our
      initial business combination within the required time frame we will be forced
      to
      liquidate.





***The
      financial services industry faces substantial regulatory and litigation risks
      and conflicts of interest, and, after the consummation of a business combination
      with a company in the financial services industry, we may face legal liability
      and reduced revenues and profitability if our services are not regarded as
      compliant or for other reasons.***





The
      financial
      services industry in many countries is subject to extensive regulation. Many
      regulators, including government agencies and self-regulatory organizations,
      are
      empowered to conduct administrative proceedings and investigations that can
      result in, among other things, censure, fine, the issuance of cease-and-desist
      orders, prohibitions against engaging in some lines of business or the
      suspension or expulsion of a broker-dealer or investment adviser. The
      requirements imposed by regulators are designed to ensure the integrity of
      the
      financial markets and to protect consumers and other third parties who deal
      with
      financial services firms and are not designed to protect our shareholders.




44





Governmental
      and self-regulatory organizations, such as securities exchanges and markets,
      impose and enforce regulations on financial services companies. Self-regulatory
      organizations often adopt rules that govern aspects of the financial services
      industry and conduct periodic examinations of the operations of broker-dealers
      and investment advisers. Broker-dealers may subject to rules and regulations
      that cover all aspects of the securities business including: sales methods
      and
      trade practices; use and safekeeping of customer funds and securities; capital
      structures; recordkeeping; the preparation of research; the extension of credit;
      and the conduct of officers and employees. Similarly, governmental and
      self-regulatory organizations in other countries having jurisdiction over the
      operation of any entity which we acquire will likely impose similar rules and
      regulations. The types of regulations to which investment advisers are subject
      are also extensive and include: recordkeeping; fee arrangements; client
      disclosure; custody of customer assets; and the conduct of officers and
      employees.





Various
      regulatory agencies also have stringent rules with respect to the maintenance
      of
      specific levels of net capital by securities brokerage firms. Failure to
      maintain the required net capital may subject a firm to suspension or revocation
      of registration or licensing or suspension or expulsion from the regulatory
      body
      or exchange, which ultimately could prevent any broker-dealers that we acquire
      control of from performing as a broker-dealer. In addition, a change in the
      net
      capital rules, the imposition of new rules or any unusually large charge against
      net capital could limit the operations of broker-dealers, which could harm
      our
      business if we were to consummate a business combination with a securities
      brokerage firm.





The
      regulatory environment in which we may operate may also be subject to
      modifications and further regulations. New laws or regulations or changes in
      the
      enforcement of existing laws or regulations applicable to us also may adversely
      affect our business, and our ability to function in this environment will depend
      on our ability to constantly monitor and react to these changes.





In
      recent
      years, the volume of claims and amount of damages claimed in litigation and
      regulatory proceedings against financial services firms has been increasing.
      After our initial business combination, our engagement agreements or
      arrangements may include provisions designed to limit our exposure to legal
      claims relating to our services, but these provisions may not protect us or
      may
      not be adhered to in all cases. We may also be subject to claims arising from
      disputes with employees for alleged discrimination or harassment, among other
      things. The risk of significant legal liability is often difficult to assess
      or
      quantify and its existence and magnitude often remain unknown for substantial
      periods of time. As a result, we may incur significant legal expenses in
      defending against litigation. Substantial legal liability or significant
      regulatory action against us could materially adversely affect our business,
      financial condition or results of operations or cause significant harm to our
      reputation, which could seriously harm our business.





Financial
      services firms are subject to numerous conflicts of interest or perceived
      conflicts of interest. We will need to adopt various policies, controls and
      procedures to address or limit actual or perceived conflicts and regularly
      seek
      to review and update our policies, controls and procedures. However, these
      policies, controls and procedures may result in increased costs, additional
      operational personnel and increased regulatory risk. Failure to adhere to these
      policies and procedures may result in regulatory sanctions or client litigation.
      There have been a number of highly publicized cases involving fraud or other
      misconduct by employees in the financial services industry in recent years,
      and
      we run the risk that employee misconduct could occur. It is not always possible
      to deter or prevent employee misconduct and the precautions we take to prevent
      and detect this activity may not be effective in all cases.





***After
      the consummation of our initial business combination, if such combination is
      with a company in the financial services industry, we will face strong
      competition from financial services firms, many of whom have the ability to
      offer clients a wider range of products and services than we may be able to
      offer, which could lead to pricing pressures that could materially adversely
      affect our revenue and profitability.***





If
      our
      initial business combination is with a company in the financial services
      industry, we will compete with other firms — both domestic and
      foreign — on a number of factors, including the quality of our
      employees, transaction execution, our products and services, innovation,
      reputation and price. We may fail to attract new business and we may lose
      clients if, among other reasons, we are not able to compete effectively. We
      will
      also face significant competition as result of a recent trend toward
      consolidation in this industry. In the past several years, there has been
      substantial consolidation and convergence among companies in the financial
      services industry. In particular, a number of large commercial banks, insurance
      companies and other broad-based financial services firms have established or
      acquired broker-dealers or have merged with other financial institutions. Many
      of these firms have the ability to offer a wide range of products such as loans,
      deposit-taking and insurance, brokerage, investment management and investment
      banking services, which may enhance their competitive position. They also have
      the ability to support investment banking with commercial banking, insurance
      and
      other financial services revenue in an effort to gain market share, which could
      result in pricing pressure on other businesses. We believe, in light of
      increasing industry consolidation and the regulatory overhaul of the financial
      services industry, that competition will continue to increase from providers
      of
      financial services products.




45





***The
      financial services industry has inherent risks, which may affect our net income
      and revenues.***





The
      financial services business is, by its nature, subject to numerous and
      substantial risks, including volatile trading markets and fluctuations in the
      volume of market activity. Consequently, our net income and revenues are likely
      to be subject to wide fluctuations, reflecting the effect of many factors,
      including: general economic conditions; securities market conditions; the level
      and volatility of interest rates and equity prices; competitive conditions;
      liquidity of global markets; international and regional political conditions;
      regulatory and legislative developments; monetary and fiscal policy; investor
      sentiment; availability and cost of capital; technological changes and events;
      outcome of legal proceedings; changes in currency values; inflation; credit
      ratings; and the size, volume and timing of transactions. These and other
      factors could affect the stability and liquidity of securities and future
      markets, and the ability of issuers, other securities firms and counterparties
      to perform their obligations.





A
      reduced
      volume of securities and future transactions and reduced market liquidity
      generally results in lower revenues from principal transactions and commissions.
      Lower price levels for securities may result in a reduced volume of transactions
      and may also result in losses from declines in the market value of securities
      held in proprietary trading and underwriting accounts, particularly in volatile
      or illiquid markets, or in markets influenced by sustained periods of low or
      negative economic growth, including the risk of losses resulting from the
      ownership of securities, trading and the failure of counterparties to meet
      commitments. In particular, if we consummate a business combination with an
      investment management firm, our business could be expected to generate lower
      revenue in a market or general economic downturn. Under a typical arrangement
      for an investment management business, the investment advisory fees we could
      receive would be based on the market value of the assets under management.
      Accordingly, a decline in the prices of securities would be expected to cause
      our revenue and income to decline by:





·
            causing
                the value of the assets under management to decrease, which would
                result
                in lower investment advisory fees;


·
            causing
                negative absolute performance returns for some accounts which have
                performance-based incentive fees, resulting in a reduction of revenue
                from
                such fees; or


·
            causing
                some of our clients to withdraw funds from our investment management
                business in favor of investments they perceive as offering greater
                opportunity and lower risk, which also would result in lower investment
                advisory fees.





***Many
      financial services firms face credit risks which, if not properly managed,
      could
      cause revenues and net income to decrease.***





Many
      types of financial services firms, including banks and broker-dealers, lend
      funds to their consumers. Among the risks all lenders face is the risk that
      some
      of their borrowers will not repay their loans. The ability of borrowers to
      repay
      their obligations may be adversely affected by factors beyond our control,
      including local and general economic and market conditions. A substantial
      portion of the loans may be secured by liens on real estate or securities.
      These
      same factors may adversely affect the value of real estate and securities as
      collateral. If we enter into a business combination with a firm that makes
      loans, we would maintain an allowance for loan losses to reflect the level
      of
      losses determined by management to be inherent in the loan portfolio. However,
      the level of the allowance and the amount of the provisions would only be
      estimates based on management’s judgment, and actual losses incurred could
      materially exceed the amount of the allowance or require substantial additional
      provisions to the allowance, either of which would likely have a material
      adverse effect on our revenues and net income.





**ITEM
      1B. UNRESOLVED STAFF COMMENTS.**





None.





**ITEM
      2. PROPERTIES.**





Our
      registered office in the Cayman Islands is c/o M & C Corporate Services
      Limited, P.O. Box 309GT, Ugland House, South Church Street, George Town, Grand
      Cayman, Cayman Islands. Pending consummation of a business combination or
      dissolution, we intend to lease other administrative office space in Florida
      or
      New York City. The cost for such space is included in the $7,500 per-month
      of
      our expenses for general and administrative services which will be paid to,
      and
      such services will be provided by, an unaffiliated third party. We consider
      our
      current office space adequate for our current operations.





**ITEM
      3. LEGAL PROCEEDINGS.**





None.





**ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS**





None.




46





**PART
      II**





**ITEM
      5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STAREHOLDER MATTERS AND ISSUER
      PURCHASES OF EQUITY SECURITIES.**





Our
      units,
      ordinary shares and warrants are traded on the American Stock Exchange under
      the
      symbols “CIO.U”, “CIO”, and “CIO.WS”, respectively. Our units were approved for
      listing on the American Stock Exchange on January 16, 2008. Commencing
      on February 13, 2008, the ordinary shares and warrants included in our units
      began trading separately. From the
      commencement of trading on January 16, 2008 through March 25, 2008, the high
      and
      low prices per share of our units was $10.04 and $9.50, respectively. From
      the
      commencement of trading on February
      13 ,
      2008
      through March 25, 2008, the high and low prices per share of our ordinary shares
      was $9.15 and $9.00, respectively. From the commencement of trading on February
      13 ,
      2008
      through March 25, 2008, the high and low prices per share of our warrants was
      $0.85 and $0.50, respectively.





As
      of March
      25, 2008, there were 9 holders of record of our ordinary shares and we had
      14,000,000 shares issued and outstanding. Because brokers and other institutions
      hold many of the shares on behalf of shareholders, we are unable to determine
      the actual number of shareholders represented by these record holders.





***Dividends***





We
      have never
      declared or paid cash dividends on our ordinary shares. We currently anticipate
      that we will retain all future earnings to fund the operation of our business
      and do not anticipate paying dividends on our ordinary shares in the foreseeable
      future.





***Recent
      Issuances of Unregistered Stock***





On
      January
      16, 2008, we completed a private placement of 5,725,000 warrants to our sponsor
      in connection with our offering, Ho Capital Management LLC, an entity co-managed
      and jointly owned by Angela Ho, our chief executive officer and chairman, and
      Noble Investment Fund Limited, generating gross proceeds of
      $5,725,000.





All
      of the
      proceeds received from the insider warrants (an aggregate of $5,725,000) were
      placed in the trust account. Ho Capital Management LLC and Noble Investment
      Fund
      Limited will each have a 50% beneficial ownership interest in the insider
      warrants. So long as the insider warrants are owned by Ho Capital Management
      LLC, Noble Investment Fund Limited or Angela Ho, the insider warrants may be
      exercised on a cashless basis and will not be subject to redemption. The insider
      warrants may not be sold, assigned or transferred by Ho Capital Management
      LLC
      (nor may the members interest in Ho Capital Management LLC be sold, assigned
      or
      transferred) until we have consummated a business combination. Immediately
      prior
      to the date of our prospectus, Noble Investment Fund Limited provided Ho Capital
      Management LLC with a $5,725,000 loan, the proceeds of which were used to
      purchase the insider warrants, and the insider warrants were pledged to Noble
      to
      secure repayment of such loan. The record and beneficial ownership of 2,862,500
      warrants, or 50% of such insider warrants, will be transferred by Ho Capital
      Management LLC to Noble Investment Fund Limited upon our completion of a
      business combination; and such transfer shall represent repayment of 50% of
      the
      $5,725,000 loan. The remaining $2,862,500 of such loan, plus accrued interest
      at
      the rate of 4.5% per annum, is payable by Ms. Ho only from the proceeds of
      periodic sales of the insider warrants and underlying shares. The $5,725,000
      loan from Noble Investment Fund Limited to Ho Capital Management LLC was made
      based upon a pre-existing business arrangement between Noble and Angela Ho
      whereby Ms. Ho agreed to organize the Sponsor and management of our company,
      Noble agreed to provide the financing for the purchase of the insider warrants,
      and the parties agreed to share equally in such insider warrants. The holders
      of
      the insider warrants will not have any right to any liquidation distributions
      with respect to the shares underlying the warrants in the event we fail to
      consummate a business combination and the insider warrants will expire
      worthless. The insider warrants transfer restrictions expire on the earlier
      of
      (i) a business combination or (ii) our liquidation.





The
      above
      offering and sale was deemed to be exempt under rule 506 of Regulation D and
      Section 4(2) of the Securities Act of 1933, as amended. No advertising or
      general solicitation was employed in offering the securities. The offering
      and
      sale was made to a limited number of persons, all accredited investors, and
      transfer was restricted by us in accordance with the requirements of the
      Securities Act of 1933. In addition to representations by the above-referenced
      persons, we have made independent determinations that all of the
      above-referenced persons were accredited or sophisticated investors, and that
      they were capable of analyzing the merits and risks of their investment, and
      that they understood the speculative nature of their investment.





**ITEM
      6. SELECTED FINANCIAL DATA.**





The
      following
      selected consolidated financial data should be read in conjunction with our
      financial statements and related notes and “Management’s Discussion and Analysis
      of Financial Condition and Results of Operations.” The data as of December 31,
      2007 and for the period March 22, 2007 (inception) to December 31, 2007 are
      derived from our audited financial statements which are included elsewhere
      in
      this annual report. The data as of and for the period from March 22, 2007
      (inception) to January 23, 2008 are derived from our audited financial
      statements contained in our Current Report on Form 8-K which we filed on January
      25, 2008. This selected financial data should be read in conjunction with such
      financial statements and the related reports of our auditors Rothstein Kass
      & Company, P.C.  The
      historical results are not necessarily indicative of results to be expected
      for
      future periods.




47




**Balance
                    Sheet Data:**
                
                
                **December
                      31, 2007**
                    **Actual**
                
                
                **January
                    23, 2008**
                  **Actual
                    (1)**Working
                    capital (deficiency)
                
                $
                (571,000
                )
                $
                (134,000
                )Investment
                    in Trust Account
                
                
                —
                
                
                100,000,000Total
                    assets
                
                
                1,035,000
                
                
                100,322,000Deferred
                    underwriters’ fee
                
                
                —
                
                
                3,000,000Total
                    liabilities
                
                
                1,013,000
                
                
                3,447,000Value
                    of ordinary shares which may be converted to cash($10.00
                    per share)
                
                
                —
                
                
                35,000,000
                (2)Shareholders’
                    equity
                
                $
                22,000
                
                $
                61,875,000**Statement
                    of Operations Data:**Formation
                    and operating costs
                
                
                6,000
                
                
                27,000Net
                    loss
                
                
                (3,000
                )
                
                (15,000
                )Net
                    loss per ordinary share, basic and diluted
                
                $
                0.00
                
                $
                0.01




(1)
      Does
      not include the proceeds of the January 30, 2008 exercise of the underwriters’
overallotment option in full for 1,500,000 units at $10.00 per unit yielding
      gross proceeds of $15,000,000 before underwriting fees and discounts of $600,000
      which was paid and $450,000 which is deferred as to payment until we consummate
      a business combination.





(2)
      Includes up to one share less than 35% of the total shares sold in the offering
      after giving effect to shareholder redemptions at $10.00 per share. At the
      time
      we seek shareholder approval of any business combination, we will offer each
      public shareholder (other than initial shareholders prior to this offering)
      the
      right to have such shareholder’s ordinary shares redeemed for cash if the
      shareholder votes against the business combination and the business combination
      is approved and completed, each in accordance with the instructions set forth
      in
      the proxy materials to be mailed to our shareholders. However, we will not
      consummate a business combination if public shareholders owning 35% or more
      of
      the publicly owned shares vote against such business combination and exercise
      their redemption rights.





**ITEM
      7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
      OF
      OPERATION.**





*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. We have
      based these forward-looking statements on our current expectations and
      projections about future events. These forward-looking statements are subject
      to
      known and unknown risks, uncertainties and assumptions about us that may cause
      our actual results, levels of activity, performance or achievements to be
      materially different from any future results, levels of activity, performance
      or
      achievements expressed or implied by such forward-looking statements. In some
      cases,*  *you
      can identify forward-looking statements by terminology such as “may,” “should,”
“could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,”
“continue,” or the negative of such terms or other similar expressions. Factors
      that might cause or contribute to such a discrepancy include, but are not
      limited to, those described under “Risk Factors” included elsewhere in this
      Report. The following discussion should be read in conjunction with our
      Financial Statements and related Notes thereto included elsewhere in this
      Report.*





**Overview**





Asia
      Special Situation Acquisition Corp. is a newly organized Business Combination
      Company TM or
      BCC TM .
      A BCC
      is a blank check company formed for the purpose of completing a business
      combination with one or more unidentified operating businesses, through a
      capital stock exchange, asset acquisition, stock purchase, or other similar
      transaction, including obtaining a majority interest through contractual
      arrangements. We will only acquire a business or businesses that, upon
      completion of our initial business combination, will be our majority-owned
      subsidiaries and will be neither investment companies nor companies excluded
      from the definition of investment company by Sections 3(c)(1) or 3(c)(7) of
      the
      Investment Company Act of 1940.




48





We
      intend
      to utilize cash derived from the proceeds of our offering and the sale of the
      insider warrants, our capital stock, debt or a combination of cash, capital
      stock and debt, in effecting such acquisition. The issuance of additional
      capital stock, including upon conversion of any convertible debt securities
      we
      may issue, or the incurrence of debt could have material consequences for our
      business and financial condition. The issuance of additional shares of our
      capital stock (including upon conversion of convertible debt securities):





·
            may
                significantly reduce the equity interest of our
                shareholders;


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


·
            may
                adversely affect prevailing market prices for our ordinary
                shares.





Similarly,
      if we issued debt securities, it could result in:





·
            default
                and foreclosure on our assets if our operating revenues after a business
                combination were insufficient to pay our debt
                obligations;


·
            acceleration
                of our obligations to repay the indebtedness even if we have made
                all
                principal and interest payments when due if the debt security 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
      have
      neither engaged in any operations nor generated any revenues to date. Our only
      activities since inception have been organizational activities and those
      necessary to prepare for our offering. Following our offering, we will not
      generate any operating revenues until after a business combination. We will
      generate non-operating income in the form of interest income on cash and cash
      equivalents after our offering.





The
      net
      proceeds from the sale of the units in our offering and the insider warrants
      were approximately $99,865,000 at January 23, 2008 (approximately $114,115,000
      on January 30, 2008 upon exercise of the over-allotment option in full), after
      deducting offering expenses of approximately $5,860,000 (approximately
      $6,610,000 on January 30, 2008 upon exercise of the underwriters over-allotment
      option in full, not including the underwriters' deferred fees). At January
      23,
      2008, an aggregate of $100,000,000, and approximately $114,250,000 upon the
      January 30, 2008 exercise of the underwriters’ over-allotment option in full, is
      being held in trust for our benefit and is available to consummate a business
      combination (after payment of the underwriters’ deferred fees).





We
      will
      use substantially all of the net proceeds of our offering and the sale of the
      insider warrants, as well as interest on the funds in the trust account released
      to us including those funds held in trust, to acquire control of a target
      business, including identifying and evaluating prospective acquisition
      candidates, selecting the target business, and structuring, negotiating and
      consummating the business combination. The proceeds held in the trust account
      (exclusive of any funds held for the benefit of the underwriters or used to
      pay
      public shareholders who have exercised their redemption rights in accordance
      with the instructions set forth in the proxy materials to be mailed to our
      shareholders as further discussed under the heading *“Effecting
      a business combination — Redemption Rights”* )
      may be
      used as consideration to pay the sellers of a target business with which we
      ultimately complete a business combination or, if there are insufficient funds
      not held in trust, to pay other expenses relating to such transaction such
      as
      reimbursement to insiders for out-of-pocket expenses, third party due diligence
      expenses or potential finders fees, in each case only upon the consummation
      of a
      business combination.





Any
      amounts not paid as consideration to the sellers of the target business may
      be
      used to finance operations of the target business or to effect other
      acquisitions, as determined by our board of directors at that time. Such working
      capital funds to finance operations of the target business could be used in
      a
      variety of ways including continuing or expanding the target business’
operations, for strategic acquisitions and for marketing, research and
      development of existing or new products. Such funds could also be used to repay
      any operating expenses or finders’ fees which we had incurred prior to the
      completion of our business combination if the funds available to us outside
      of
      the trust account were insufficient to cover such expenses. To the extent our
      capital stock is used in whole or in part as consideration to effect a business
      combination, the proceeds held in the trust account as well as any other net
      proceeds not expended will be released to us and will be used to finance the
      operations of the target business.




49





We
      believe that, the funds in the trust account, including up to $2,000,000 of
      the
      interest earned on funds in the trust account which will be released to us,
      plus
      the funds available to us outside of the trust account, will be sufficient
      to
      allow us to operate for at least the next 24 months, assuming that a business
      combination is not consummated during that time. Over this time period, we
      are
      budgeting approximately $2,000,000 of expenses for legal, accounting and other
      expenses, including finders fees, consulting fees and contract deposits, that
      are expected to be incurred in connection with the due diligence investigation,
      structuring and negotiating of a business combination and seeking shareholder
      approval of such business combination; approximately $450,000 for administrative
      services, reimbursement of officer and director expenses, insurance, costs
      associated with dissolution and liquidation if we do not consummate a business
      combination, and rent and office support services payable at the rate of $7,500
      per month; approximately $200,000 for legal and accounting fees relating to
      our
      SEC reporting obligations; and approximately $400,000 for general working
      capital that will be used for miscellaneous expenses. Up to approximately
      $2,000,000 of the interest earned on the trust account will be released to
      us to
      fund the above anticipated expenses.





We
      do not
      believe we will need to raise additional funds following our offering and the
      sale of the insider warrants and the line of credit established with a bank
      on
      February 28, 2008, in order to meet the expenditures required for operating
      our
      business prior to a business combination. However, we may need to raise
      additional funds through a private offering of debt or equity securities if
      such
      funds are required to consummate a business combination that is presented to
      us.
      We would only consummate such a fundraising simultaneously with the consummation
      of a business combination.





In
      seeking a business combination, we intend to utilize cash derived from the
      proceeds of our offering and the sale of the insider warrants, as well as our
      capital stock or debt, or a combination of cash, capital stock and debt, and
      there is no limit on the issuance of capital stock or incurrence of debt we
      may
      undertake in effecting a business combination. In the event a business
      combination is consummated, all sums remaining in the trust account will be
      released to us immediately thereafter, and there will be no restriction on
      our
      use of such funds.





Our
      Sponsor
      agreed to make available to us a line of credit of up to $500,000, which was
      used to pay a portion of the expenses of our offering, such as SEC registration
      fees, FINRA registration fees, and certain legal and accounting fees and
      expenses. These loans were paid on January 23, 2008.





We
      have
      granted a purchase option to the underwriters issued upon the effective date
      of
      our offering. We have accounted for this purchase option as a cost of raising
      capital and will include the instrument as equity in our financial statements.
      Accordingly, there will be no net impact on our financial position or results
      of
      operations, except for the recording of the $100 proceeds from the sale. We
      have
      estimated, based upon a Black-Scholes model, that the fair value of the purchase
      option on the date of sale is approximately $0.78 per unit (a total value of
      $368,525), using an expected life of five years, volatility of 9.45% and a
      risk-free rate of 4.17%. The volatility calculation is based on the average
      volatility of 16 business combination companies that have completed their public
      offerings in amounts ranging from $75,000,000 to $150,000,000, but have not
      yet
      announced an acquisition, during the period from January 1, 2002 to September
      26, 2007. These 16 companies represent all business combination companies that
      have completed their public offerings in amounts ranging from $75,000,000 to
      $150,000,000, but have not yet announced an acquisition, during such period.
      Because we do not have a trading history, we needed to estimate the potential
      volatility of the unit price, which will depend on a number of factors which
      cannot be ascertained at this time. We used these companies because management
      believes that the volatility of these companies is a reasonable benchmark to
      use
      in estimating the expected volatility for our units. Although an expected life
      of five years was used in the calculation, if we do not consummate a business
      combination within the prescribed time period and our company is liquidated,
      the
      option will become worthless.





We
      do not
      believe that the sale of the warrants in the private placement completed
      immediately before the date of our prospectus will result in a compensation
      expense because they are being sold at or above fair market value.





**Results
      of Operations**





Except
      for
      the consummation of our initial public offering and our private placement,
      we
      have neither engaged in any operations nor generated any revenues to date.
      For
      the period from March 22, 2007 (inception) to December 31, 2007, our only
      activities have been organizational activities and those necessary to prepare
      for our offering. Thereafter our activities include certain activities related
      to pursuing a target business. We will not generate any operating income until
      the completion of a business combination, should it occur. We have begun to
      generate non-operating income in the form of interest income on the investments
      held in our trust account subsequent to the closing of our public offering
      of
      units on January 23, 2008.




For
      the
      period from March 22, 2007 (inception) to December 31, 2007, we had a net loss
      of approximately ($3,000) comprised of approximately $6,000 of formation and
      operating costs net of interest income of approximately $3,000.





50




**Liquidity
      and Capital Resources**





At
      December
      31, 2007, we had cash of approximately $194,000 and negative working capital
      of
      approximately $571,000 largely due to a line of credit from our sponsor and
      principal shareholder of $500,000 which was repaid on January 23, 2008.





On
      January
      16, 2008, we completed a private placement of 5,725,000 warrants to our sponsor
      in connection with our offering, Ho Capital Management LLC, an entity co-managed
      and jointly owned by Angela Ho, our chief executive officer and chairman, and
      Noble Investment Fund Limited, generating gross proceeds of
      $5,725,000.





On
      January
      23, 2008, our initial public offering of 10,000,000 units was consummated.
      Each
      unit issued in our offering consists of one ordinary share and one warrant,
      each
      warrant to purchase one ordinary share at an exercise price of $7.50 per
      ordinary share. The units were sold at an offering price of $10.00 per unit,
      generating gross proceeds of $100,000,000.





On
      January
      30, 2008, the underwriters for our initial public offering exercised their
      over-allotment option in full, to the extent of 1,500,000 units. Each unit
      consists of one ordinary share and one warrant, each warrant to purchase one
      ordinary share at an exercise price of $7.50 per ordinary share. The offering,
      including the exercise of the over-allotment option, generated total gross
      proceeds of $115,000,000 to us (excluding proceeds of $5,725,000 from the sale
      of private placement warrants to our sponsor in connection with the offering,
      Ho
      Capital Management LLC, an entity co-managed and jointly owned by Angela Ho,
      our
      chief executive officer and chairman, and Noble Investment Fund
      Limited).





On
      February
      28, 2008, we consummated a Loan and Security Agreement (the “ Agreement ”)
      with
      Wachovia Bank, National Association pursuant to which we issued a $500,000
      principal amount promissory note to Wachovia for future advances to us by
      Wachovia under a line of credit to be used for working capital and general
      corporate purposes.





The
      note pays
      interest at the prime rate, which is equal to the rate per annum in effect
      as
      announced from time to time by Wachovia as its prime rate (the “ Interest
      Rate ”).
      Upon
      the occurrence of a default by us under the Agreement or the note, the Note
      pays
      interest at a rate equal to the Interest Rate plus 2%. Payments of accrued
      interest must be made by us commencing on June 1, 2008, and continuing on the
      first day of each calendar month thereafter until fully paid. In any event,
      all
      principal and accrued and unpaid interest is due on the earlier of (i) any
      termination or liquidation of the property or assets maintained in trust (the
      “ Trust ”)
      by
      Continental Stock Transfer and Trust Company, as trustee, pursuant to that
      certain Investment Management Trust Agreement dated as of January 16, 2008
      (the
“ Trust
      Agreement ”),
      in
      connection with our initial public offering of $115 million completed in January
      2008; or (ii) September 1, 2008. Moreover, we may elect to prepay, without
      penalty, all or a portion of the principal amount and accrued and unpaid
      interest then outstanding under the note in a minimum aggregate amount of
      $10,000, and in multiples equal to $5,000 in excess of $10,000.





Under
      the
      Agreement, our obligations under the note are secured by a first priority
      security interest granted by us to Wachovia in (i) distributions or proceeds
      from the Trust pursuant to the Trust Agreement, including, without limitation,
      all rights, title and interest of our company in interest and dividend income
      distributable to us pursuant to Section 2(b) of the Trust Agreement in an amount
      equal to $2,000,000, and (ii) all deposit accounts into which any of the
      foregoing distributions or proceeds are disbursed or held (collectively, the
      “ Collateral ”).
      Notwithstanding the foregoing, the Collateral does not include any of
      the assets and property held in the Trust, and Wachovia has agreed not to
      assert any claim against Trust assets or property.





We
      believe
      that the funds available to us outside of the trust account, together with
      the
      balance of the interest income (net of taxes) on the trust account releasable
      to
      us to fund our working capital requirements, will be sufficient to allow us
      to
      operate for more than twelve months, assuming that a business combination is
      not
      consummated during that time. However, if the funds available to us are not
      sufficient to fund our working capital needs throughout this period, we will
      seek to secure additional capital to pay for, or defer payment of, all or a
      significant portion of any expenses we incur.





**Off-Balance
      Sheet Arrangements**




We
      do not
      have any off balance sheet arrangements that are reasonably likely to have
      a
      current or future effect on our financial condition, revenues, results of
      operations, liquidity or capital expenditures.





**Critical
      Accounting Policies**





*Basis
      of Presentation*





Our
      financial statements are presented in U.S. dollars and have been prepared in
      accordance with accounting principles generally accepted in the United States
      of
      America and pursuant to the rules and regulations of the Securities and Exchange
      Commission.




51





*Development
      Stage Company*





We
      comply
      with the reporting requirements of SFAS No. 7, “Accounting and Reporting by
      Development Stage Enterprises.”





*Net
      Loss Per Ordinary Share*





We
      comply
      with the accounting and disclosure requirements of SFAS No. 128, “Earnings Per
      Share.” Net loss per ordinary share is computed by dividing net loss by the
      weighted average number of ordinary shares outstanding for the period. Net
      loss
      per ordinary share, assuming dilution, reflects the maximum potential dilution
      that could occur if securities or other contracts to issue ordinary shares
      were
      exercised or converted into ordinary shares and would then share in our earnings
      except where the result would be anti-dilutive. At December 31, 2007, we had
      no
      contracts to issue ordinary shares.





*Fair
      Value of Financial Instruments*





The
      fair
      value of our assets and liabilities, which qualify as financial instruments
      under SFAS No. 107, “Disclosure About Fair Value of Financial Instruments,”
approximates the carrying amounts represented in our balance sheet.





*Concentration
      of Credit Risk*





Financial
      instruments that potentially subject us to concentrations of credit risk consist
      of cash accounts in a financial institution, which at times, exceeds the Federal
      depository insurance coverage of $100,000. We have not experienced losses on
      these accounts and management believes we are not exposed to significant risks
      on such accounts.





*Use
      of Estimates*





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





*Income
      Taxes*





We
      follow the
      asset and liability method of accounting for income taxes. Deferred tax assets
      and liabilities are recognized for the estimated future tax consequences
      attributable to differences between the financial statements carrying amounts
      of
      existing assets and liabilities and their respective tax bases. Deferred tax
      assets and liabilities are measured using enacted tax rates expected to apply
      to
      taxable income in the years in which those temporary differences are expected
      to
      be recovered or settled. The effect on deferred tax assets and liabilities
      of a
      change in tax rates is recognized in income in the period that included the
      enactment date.





Under
      the
      laws of the Cayman Islands, we are not subject to income taxes. Accordingly,
      no
      provision for income taxes has been made in the accompanying financial
      statements.





*Foreign
      Currency Translation*





The
      United States dollar is our reporting and functional currency.




52





In
      accordance with SFAS 52, “Foreign Currency Translation”, foreign currency
      balance sheets will be translated using the end of period exchange rates, and
      statements of operations will be translated at the average exchange rates for
      each period. The resulting translation adjustments to the balance sheet will
      be
      recorded in accumulated other comprehensive income (loss) within stockholders’
equity.





Foreign
      currency transaction gains and losses will be included in the statement of
      operations as they occur.





**Recently
      Issued Accounting Pronouncements**





In
      December
      2007, the FASB issued SFAS No 141R, “Business Combinations” (“SFAS 141R”). SFAS
      141R replaces SFAS 141 and establishes principles and requirements for how
      an
      acquirer recognizes and measures in its financial statements the identifiable
      assets acquired, the liabilities assumed, any non controlling interest in the
      acquiree and the goodwill acquired. SFAS 141R also establishes disclosure
      requirements which will enable users to evaluate the nature and financial
      effects of the business combination. Acquisition costs associated with the
      business combination will generally be expensed as incurred. SFAS 141R is
      effective for business combinations occurring in fiscal years beginning after
      December 15, 2008, which will require us to adopt these provisions for business
      combinations occurring in fiscal 2009 and thereafter.





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





**ITEM
      7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.**





Market
      risk
      is the sensitivity of income to changes in interest rates, foreign exchanges,
      commodity prices, equity prices, and other market-driven rates or prices. We
      are
      not presently engaged in and, if a suitable business target is not identified
      by
      us prior to the prescribed liquidation date of the trust account, we may not
      engage in, any substantive commercial business. Accordingly, we are not and,
      until such time as we consummate a business combination, we will not be, exposed
      to risks associated with foreign exchange rates, commodity prices, equity prices
      or other market-driven rates or prices. The net proceeds of our initial public
      offering held in the trust account have been invested only in money market
      funds
      meeting certain conditions under Rule 2a-7 promulgated under the Investment
      Company Act of 1940. Given our limited risk in our exposure to money market
      funds, we do not view the interest rate risk to be significant.




53


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




**Asia
        Special Situation Acquisition Corp.**
 **(a
        corporation in the development stage)**
 INDEX
                    TO FINANCIAL STATEMENTSReport
                    of Independent Registered Public Accounting Firm
                55Financial
                    Statements:Balance
                    Sheet as of December 31, 2007
                56Statement
                    of Operations for the period March 22, 2007 (inception) to December
                    31,
                    2007
                57Statement
                    ofShareholders’
                    Equity for the period March 22, 2007 (inception) to December
                    31,
                    2007
                58Statement
                    of Cash Flows for the period March 22, 2007 (inception) to December
                    31,
                    2007
                59Notes
                    to Financial Statements
                60
                    - 66
  
 54
  
 **Report
        of Independent Registered Public Accounting Firm**
 
 To
        the
        Board of Directors and Shareholders of
 Asia
        Special Situation Acquisition Corp.
 
 We
        have
        audited the accompanying balance sheet of Asia Special Situation Acquisition
        Corp. (a corporation in the development stage) (the “Company”) as of December
        31, 2007 and the related statements of operations, shareholders’ equity and cash
        flows for the period March 22, 2007 (inception) to December 31, 2007. These
        financial statements are the responsibility of the Company’s management. Our
        responsibility is to express an opinion on these financial statements based
        on
        our audit.
 
 We
        conducted our audit in accordance with the standards of the Public Company
        Accounting Oversight Board (United States). Those standards require that
        we plan
        and perform the audit to obtain reasonable assurance about whether the financial
        statements are free of material misstatement. The Company is not required
        to
        have, nor were we engaged to perform, an audit of its internal control over
        financial reporting. Our audit included consideration of internal control
        over
        financial reporting as a basis for designing audit procedures that are
        appropriate in the circumstances, but not for the purpose of expressing an
        opinion on the effectiveness of the Company’s internal control over financial
        reporting. Accordingly, we express no such opinion. An audit also includes
        examining, on a test basis, evidence supporting the amounts and disclosures
        in
        the financial statements, assessing the accounting principles used and
        significant estimates made by management, as well as evaluating the overall
        financial statement presentation. We believe that our audit provides a
        reasonable basis for our opinion.
 
 In
        our
        opinion, the financial statements referred to above present fairly, in all
        material respects, the financial position of Asia Special Situation Acquisition
        Corp. (a corporation in the development stage) as of December 31, 2007, and
        the
        results of its operations and its cash flows for the period March 22, 2007
        (inception) to December 31, 2007, in conformity with accounting principles
        generally accepted in the United States of America.
   /s/
        Rothstein, Kass & Company, P.C
  Roseland,
        New Jersey


March
        17,
        2008
  55
  **ASIA
                    SPECIAL SITUATION ACQUISITION CORP.**(a
                    corporation in the development stage)**BALANCE
                    SHEET**December
                    31, 2007
  **ASSETS****Current
                    assets**Cash
                
                $
                194,000Prepaid
                    expenses
                
                
                248,000Total
                    current assets
                
                
                442,000**Other
                    assets -**deferred
                    offering costs
                
                
                593,000$
                1,035,000**LIABILITIES
                    AND SHAREHOLDERS' EQUITY****Current
                    Liabilities**Accounts
                    payable and accrued expenses
                
                $
                513,000Line
                    of credit, shareholder
                
                
                500,000Total
                    current liabilities
                
                
                1,013,000**Commitments
                    and contingencies****Shareholders'
                    equity**Preferred
                    shares, $0.0001 par value; 1,000,000 shares authorized; none
                    issuedOrdinary
                    shares, $0.0001 par value; authorized 50,000,000 shares; 2,500,000
                    shares
                    issued and outstanding
                
                
                -Additional
                    paid-in capital
                
                
                25,000Deficit
                    accumulated during the development stage
                
                
                (3,000
                )Total
                    shareholders' equity
                
                
                22,000$
                1,035,000
 See
          accompanying notes to financial statements
  56
  **ASIA
                    SPECIAL SITUATION ACQUISITION CORP.**(a
                    corporation in the development stage)**STATEMENT
                    OF OPERATIONS**For
                    the period March 22, 2007 (inception) to December 31, 2007
  Revenue
                
                $
                -Formation
                    and operating costs
                
                
                6,000Loss
                    from operations
                
                
                (6,000
                )Other
                    income: interest
                
                
                3,000Net
                    loss
                
                $
                (3,000
                )Weighted
                    average number of ordinary shares outstanding, basic and
                    diluted
                
                
                2,500,000Net
                    loss per ordinary share, basic and diluted
                
                $
                (0.00
                )
  See
          accompanying notes to financial statements
  57
  **ASIA
                    SPECIAL SITUATION ACQUISITION CORP.**(a
                    corporation in the development stage)**STATEMENT
                    OF SHAREHOLDERS' EQUITY**For
                    the period March 22, 2007 (inception) to December 31, 2007
  DeficitAccumulatedAdditional
                
                During
                
                TotalOrdinary
                    Shares
                
                Paid-in
                
                Development
                
                Shareholders'Shares
                
                Amount
                
                Capital
                
                Stage
                
                EquityOrdinary
                    shares issued to founders at $0.01 per shareon
                    March 23, 2007
                
                
                2,500,000
                
                $
                -
                
                $
                25,000
                
                $
                -
                
                $
                25,000Net
                    loss for the period
                
                
                -
                
                
                -
                
                
                -
                
                
                (3,000
                )
                
                (3,000
                )Balances,
                    at December 31, 2007
                
                
                2,500,000
                
                $
                -
                
                $
                25,000
                
                $
                (3,000
                )
                $
                22,000
  See
          accompanying notes to financial statements
  58
  **ASIA
                      SPECIAL SITUATION ACQUISITION CORP.**(a
                      corporation in the development stage)**STATEMENT
                      OF CASH FLOWS**For
                      the period March 22, 2007 (inception) to December 31, 2007
  **Cash
                      flows from operating activities**Net
                      loss
                  
                  $
                  (3,000
                  )Adjustments
                      to reconcile net loss to net cash provided by operating
                      activities:Increase
                      in cash attributable to change in current assets and
                      liabilitiesPrepaid
                      expenses
                  
                  
                  (248,000
                  )Accrued
                      expenses
                  
                  
                  253,000**Net
                      cash provided by operating activities**
                  
                  
                  2,000**Cash
                      flows from investing activities**
                  
                  
                  -**Cash
                      flows from financing activities**Proceeds
                      from line of credit, shareholder
                  
                  
                  500,000Payments
                      of offering costs
                  
                  
                  (333,000
                  )Proceeds
                      from issuance of ordinary shares to initial shareholders
                  
                  
                  25,000**Net
                      cash provided by financing activities**
                  
                  
                  192,000**Net
                      increase in cash**
                  
                  
                  194,000**Cash**,
                      beginning of period
                  
                  
                  -**Cash**,
                      end of period
                  
                  $
                  194,000**Supplemental
                      schedule of non-cash financing activities:**Accrued
                      offering costs
                  
                  $
                  260,000
  See
          accompanying notes to financial statements
  59
  ASIA
        SPECIAL SITUATION ACQUISITION CORP.
 (a
        corporation in the development stage)
 
 Notes
        to
        Financial Statements
 **NOTE
          1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS**
 
 Asia
          Special Situation Acquisition Corp. (a corporation in the development stage)
          (the “Company”) was formed under the laws of the Cayman Islands for the purpose
          of acquiring, engaging in a capital stock exchange with, purchasing all
          or
          substantially all of the assets of, or obtaining a majority interest through
          contractual arrangements, of one or more unidentified operating businesses.
          The
          Company intends to acquire all or a controlling interest in the equity
          of such
          operating business or businesses. In addition, the Company will only acquire
          a
          business or businesses that, upon completion of the Company’s initial business
          combination, will be its majority-owned subsidiaries and will be neither
          investment companies nor companies excluded from the definition of investment
          company by Sections 3(c)(1) or 3(c)(7)of the Investment Company Act of
          1940. If
          the Company’s initial business combination involves a transaction in which it
          acquires less than a 100% interest in the target company, the value of
          that
          interest that the Company acquires will be equal to at least 80% of the
          balance
          in the trust account (excluding deferred underwriting discounts and
          commissions). In all instances, the Company would control the target company.
          The Company is considered to be in the development stage as defined in
          Statement
          of Financial Accounting Standards (“SFAS”) No. 7, “Accounting and Reporting
          By Development Stage Enterprises”, and is subject to the risks associated with
          activities of development stage companies. The Company has selected
          December 31st as its fiscal year end.
 
 At
          December 31, 2007, the Company had not commenced any operations or generated
          revenue. All activity through December 31, 2007 relates to the Company’s
          inception, capital raising and the initial public offering described below.
          Following such offering, the Company will not generate any operating revenues
          until after completion of its initial business combination, at the earliest.
          The
          Company will generate non-operating income in the form of interest income
          on
          cash and cash equivalents, held in a trust account, from the proceeds of
          such
          offering
 
 The
          Company intends to identify prospective acquisitions that are located in
          or
          providing products or services to customers located in Asia. The Company’s
          efforts to identify a prospective target business will not be limited to
          a
          particular industry or area in Asia, although the Company initially intends
          to
          focus efforts on acquiring an operating business, in the leisure and hospitality
          and financial services industries, that is located in or providing products
          or
          services to consumers in China. In evaluating a prospective target business,
          the
          Company will consider, among other factors, the financial condition and
          results
          of operation; growth potential; experience and skill of management; availability
          of additional personnel; capital requirements; competitive position; barriers
          to
          entry into other industries; stage of development of the products, processes
          or
          services; degree of current or potential market acceptance of the products,
          processes or services; proprietary features and degree of intellectual
          property
          or other protection of the products, processes or services; regulatory
          environment of the industry; and costs associated with effecting the business
          combination. These criteria are not intended to be exhaustive. Any evaluation
          relating to the merits of a particular business combination will be based,
          to
          the extent relevant, on the above factors, as well as other considerations
          deemed relevant by the Company in effecting a business combination consistent
          with its business objective. The Company’s operations, if a business combination
          is consummated outside the United States, will be subject to local government
          regulations and to the uncertainties of the economic and political conditions
          of
          those areas.
 
 The
          registration statement for the Company’s initial public offering (the
“Offering”) (as described in Note 3) was declared effective on January 16, 2008
          and the Company consummated the offering on January 23, 2008 and preceding
          the
          consummation of the Offering, an affiliate of the Company’s sponsor, which is an
          entity co-managed and jointly owned by Angela Ho, the Company’s chief executive
          officer and chairman, and Noble Investment Fund Limited, purchased warrants
          to
          purchase 5,725,000 ordinary shares at $1 per warrant in a private placement
          (the
“Private Placement”) (see Note 4).
  60
 ASIA
            SPECIAL SITUATION ACQUISITION CORP.
 (a
            corporation in the development stage)
 
 Notes
            to
            Financial Statements
 Upon
              the
              closing of the Offering and over-allotment, $114,250,000 of the aggregate
              proceeds including the private placement have been placed in a trust
              account at
              J.P. Morgan Chase Bank N.A. maintained by Continental Stock Transfer
& Trust
              Company, pursuant to an agreement with the underwriters. Of this amount,
              up to
              $110,800,000 may be used for the purpose of effecting a business combination,
              and up to $3,450,000 will be paid to the underwriters if a business
              combination
              is consummated, but will be forfeited by the underwriters if a business
              combination is not consummated. These funds will not be released until
              the
              earlier of the completion of a business combination or automatic dissolution
              and
              liquidation; provided, however, that the Company’s plan to draw the following
              amounts from the interest accrued on the trust account prior to, or
              upon the
              consummation of, a business combination or the Company’s liquidation: (i) taxes
              payable on interest earned and (ii) up to $2,000,000 of interest income
              to fund
              working capital.
 
 The
              Company's first business combination must be with a business or combination
              of
              businesses with a fair market value of at least 80% of the amount in
              the
              Company's trust account, less deferred offering costs of $3,450,000
              at the time
              of acquisition. In the event that shareholders owning 35% or more of
              the
              outstanding stock excluding, for this purpose, those persons who were
              shareholders prior to the Offering, vote against the business combination
              and
              request their redemption right as described below, the business combination
              will
              not be consummated. In the event that more than 20%, but less than
              35% of the
              shares owned by the Company’s public shareholders vote against a proposed
              business combination and exercise their redemption rights, the Company
              is still
              required to complete a business combination whose fair market value
              is equal to
              at least 80% of the amount in the trust account at the time of such
              acquisition,
              and as a result of any such redemptions may have to issue debt or additional
              equity securities to consummate the business combination or otherwise
              may be
              forced to dissolve and liquidate the Company. All of the Company's
              shareholders
              prior to the Offering, including all of the officers and directors
              of the
              Company (the “Initial Shareholders”), have agreed to vote their 2,500,000
              founding ordinary shares in accordance with the vote of the majority
              in interest
              of all other shareholders of the Company (the “Public Shareholders”) with
              respect to any business combination. Additionally, in the event that
              any of the
              Initial Shareholders acquire shares of the Company in connection with
              the
              initial public offering, or in the aftermarket, they have each agreed
              to vote in
              favor of any business combination.
 
 With
              respect to the first business combination which is approved and consummated,
              any
              Public Shareholder who voted against the business combination may demand
              that
              the Company redeem his or her shares. The per share redemption price
              will equal
              the amount in the trust account as of the record date for determination
              of
              shareholders entitled to vote on the business combination divided by
              the number
              of ordinary shares held by Public Shareholders at the consummation
              of the
              Offering. Accordingly, Public Shareholders holding one share less than
              35% of
              the aggregate number of ordinary shares owned by all Public Shareholders
              may
              seek redemption of their shares in the event of a business combination.
              Such
              Public Shareholders are entitled to receive their per share interest
              in the
              trust account computed without regard to the shares held by Initial
              Shareholders.
 
 Without
              the prior written consent of at least 95% of the Company’s outstanding ordinary
              shares, the Company’s Amended and Restated Memorandum and Articles of
              Association provides for mandatory liquidation of the Company, without
              shareholder approval, in the event that the Company does not consummate
              a
              business combination by July 16, 2009, or by January 16, 2010 if certain
              extension criteria have been satisfied.
 
 The
              shares owned by the Initial Shareholders are being held in an escrow
              account
              maintained by the trustee, acting as escrow agent, for up to three
              years.
  61
 ASIA
                SPECIAL SITUATION ACQUISITION CORP.
 (a
                corporation in the development stage)
 
 Notes
                to
                Financial Statements
  **NOTE
              2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
 
 *Basis
              of presentation:*
  The
              accompanying financial statements are presented in U.S. dollars and
              have been
              prepared in accordance with accounting principles generally accepted
              in the
              United States of America and pursuant to the rules and regulations
              of the U.S.
              Securities and Exchange Commission (the “SEC”).
 
 *Development
              stage company* :
 
 The
              Company complies with the reporting requirements of SFAS No. 7, "Accounting
              and Reporting by Development Stage Enterprises."
 
 *Net
              loss per ordinary share:*
 
 The
              Company complies with the accounting and disclosure requirements of
              SFAS No.
              128, “Earnings Per Share.” Net loss per ordinary share is computed by dividing
              net loss by the weighted average number of ordinary shares outstanding
              for the
              period. Net loss per ordinary share, assuming dilution, reflects the
              maximum
              potential dilution that could occur if securities or other contracts
              to issue
              ordinary shares were exercised or converted into ordinary shares and
              would then
              share in the earnings of the Company except where the result would
              be
              antidilutive. As of December 31, 2007, the Company did not have any
              dilutive
              securities, therefore diluted loss per ordinary share is equal to basic
              loss per
              ordinary share for the period.
 
 *Fair
              value of financial instruments* :
 
 The
              fair value of the Company's assets and liabilities, which qualify as
              financial
              instruments under SFAS No. 107, "Disclosure About Fair Value of Financial
              Instruments," approximates the carrying amounts represented in the
              accompanying
              balance sheet.
 
 *Concentration
              of credit risk* :
 
 Financial
              instruments that potentially subject the Company to concentrations
              of credit
              risk consist of a cash account in a financial institution, which at
              times, may
              exceed the Federal depository insurance coverage of $100,000. The Company
              has
              not experienced losses on these accounts and management believes the
              Company is
              not exposed to significant risks on such accounts.
 
 *Use
              of estimates* :
 
 The
              preparation of financial statements in conformity with accounting principles
              generally accepted in the United States of America requires management
              to make
              estimates and assumptions that affect the reported amounts of assets
              and
              liabilities and disclosure of contingent assets and liabilities at
              the date of
              the financial statements and the reported amounts of revenues and expenses
              during the reporting period. Actual results could differ from those
              estimates.
 
 *Deferred
              offering costs* :
 
 The
              Company complies with the requirements of the SEC’s Staff Accounting Bulletin
              (“SAB”) Topic 5A—"Expenses of Offering". Deferred offering costs consisted
              principally of legal and underwriting fees that are related to the
              Offering that
              will be charged to shareholders’ equity upon the completion of the Offering. As
              of December 31, 2007, the Company incurred $593,000 of deferred offering
              cost of
              which, approximately $260,000 is unpaid and included in accrued expenses.
 
 *Preferred
              shares*
  The
              Company is authorized to issue 1,000,000 preferred shares with such
              designations, voting and other rights and preferences as may be determined
              from
              time to time by the Board of Directors.
  62
 ASIA
                SPECIAL SITUATION ACQUISITION CORP.
 (a
                corporation in the development stage)
 
 Notes
                to
                Financial Statements
 *Redeemable
                  ordinary shares:*
 
 If
                  the
                  Company’s initial Business Combination is approved, Public Shareholders
                  voting
                  against the Business Combination will be entitled to convert their
                  ordinary
                  shares into a pro rata share of the aggregate amount then on deposit
                  in the
                  trust account, including their pro rata portion of the deferred
                  underwriting
                  discount and any interest income earned on the trust account, net
                  of (1) income
                  taxes payable on the interest income on the trust account and (2)
                  up to
                  $2,000,000 of interest earned on the trust account balance which
                  will be
                  available to the Company, net of income taxes payable on this amount,
                  to fund
                  working capital requirements. The initial per share conversion
                  price was $10.00
                  at January 23, 2008, which is prior to the exercise of the
                  over-allotment.
 
 The
                  Company accounts for redeemable ordinary shares in accordance with
                  Emerging
                  Issue Task Force D-98 “Classification and Measurement of Redeemable Securities”.
                  Securities that are redeemable for cash or other assets are classified
                  outside
                  of permanent equity if they are redeemable at the option of the
                  holder. The
                  Company recognizes changes in the redemption value immediately
                  as they occur and
                  will adjust the carrying value of the redeemable ordinary shares
                  to equal its
                  redemption value at the end of each reporting period.
 
 *Income
                  taxes:*
 
 In
                  accordance with SFAS 109, “Accounting for Income Taxes”, the Company follows the
                  asset and liability method of accounting for income taxes. Deferred
                  tax assets
                  and liabilities are recognized for the estimated future tax consequences
                  attributable to differences between the financial statements carrying
                  amounts of
                  existing assets and liabilities and their respective tax bases.
                  Deferred tax
                  assets and liabilities are measured using enacted tax rates expected
                  to apply to
                  taxable income in the years in which those temporary differences
                  are expected to
                  be recovered or settled. The effect on deferred tax assets and
                  liabilities of a
                  change in tax rates is recognized in income in the period that
                  included the
                  enactment date. Valuation allowances are established, when necessary,
                  to reduce
                  deferred tax assets to the amount to be realized.
 
 *Foreign
                  Currency Translation*
 
 The
                  United States dollar is the reporting and functional currency of
                  the
                  Company.
  In
                  accordance with SFAS 52, “Foreign Currency Translation”, foreign currency
                  balance sheet items will be translated using the end of period
                  exchange rates,
                  and statement of operations items will be translated at the transaction
                  date of
                  at the average exchange rates for each period. The resulting translation
                  adjustments to the balance sheet will be recorded in accumulated
                  other
                  comprehensive income (loss) within shareholders’ equity.
 
 Foreign
                  currency transaction gains and losses will be included in the statement
                  of
                  operations as they occur.
 
 As
                  of
                  December 31, 2007, there were no local currency financial statements
                  and,
                  therefore, no such gains or losses were recognized in the statement
                  of
                  operations and no translation adjustments were recognized in shareholders’
equity.
 
 *Recently
                  issued accounting pronouncements*
 
 In
                  December 2007, the FASB issued SFAS No 141R, “Business Combinations” (“SFAS
                  141R”). SFAS 141R replaces SFAS 141 and establishes principles and requirement
                  for how an acquirer recognizes and measures in its financial statements
                  the
                  identifiable assets acquired, the liabilities assumed, any non
                  controlling
                  interest in the acquiree and the goodwill acquired. SFAS 141R also
                  establishes
                  disclosure requirements which will enable users to evaluate the
                  nature and
                  financial effects of the business combination. Acquisition costs
                  associated with
                  the business combination will generally be expensed as incurred.
                  SFAS 141R is
                  effective for business combinations occurring in fiscal years beginning
                  after
                  December 15, 2008, which will require the Company to adopt these
                  provisions for
                  business combinations occurring in fiscal 2009 and thereafter.
  63
 ASIA
                    SPECIAL SITUATION ACQUISITION CORP.
 (a
                    corporation in the development stage)
 
 Notes
                    to
                    Financial Statements
 Management
                  does not believe that any other recently issued, but not yet effective,
                  accounting standars if currently adopted would have a material
                  effect on the
                  accompanying financial statements.
 
 **NOTE
                  3—INITIAL PUBLIC OFFERING**
 
 On
                  January 23, 2008, the Company consummated the sale of 10,000,000
                  units (“Units”)
                  at a price of $10.00 per unit. Each Unit consists of one of the
                  Company's $.0001
                  par value ordinary shares and one Redeemable Ordinary Share Purchase
                  Warrant
                  (“Warrant”). Each Warrant entitles the holder to purchase from the Company
                  one
                  ordinary share at an exercise price of $7.50 commencing on the
                  later of: (i) the
                  completion of business combination with a target, or (ii) January
                  16, 2009 and
                  expiring on January 16, 2012. On January 30, 2008, an additional
                  1,500,000 Units were purchased pursuant to a 45-day option granted
                  to the
                  underwriters to cover any over-allotments. The Warrants may be
                  redeemed by the
                  Company, at a price of $0.01 per Warrant, upon thirty (30) days
                  notice after the
                  Warrants become exercisable, only in the event that the average
                  sale price of
                  the ordinary share is at least $14.25 per share for any twenty
                  (20) trading days
                  within a thirty (30) trading-day period ending on the third day
                  prior to date on
                  which notice of redemption is given. If the Company is unable to
                  deliver
                  registered ordinary shares to the holder upon exercise of warrants
                  during the
                  exercise period, there will be no cash settlement of the warrants
                  and the
                  warrants will expire worthless.
 
 In
                  connection with the Offering and over-allotment option, the Company
                  paid an
                  underwriting discount of $4,600,000 (4.0%) and a non-accountable
                  corporate
                  finance fee of $1,150,000 (1%). An additional fee of $3,450,000
                  (3.0% ) is
                  payable upon the Company's consummation of a business combination.
                  The
                  underwriters will not be entitled to any interest accrued on the
                  deferred fee
                  and have agreed to forfeit their share of the deferred fee due
                  them to the
                  extent of shares redeemed by Public Shareholders.
 
 In
                  connection with the Offering, the Company has also sold to the
                  underwriter, for
                  $100 as additional compensation, an option to purchase up to a
                  total of 475,000
                  units at a price of $12.50 per unit. The 475,000 units to be issued
                  upon
                  exercise of these options are identical to those sold in the Company's
                  Offering.
                  The Company has accounted for this purchase option as a cost of
                  raising capital
                  and has included the instrument as equity in its financial statements.
                  Accordingly, there is 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 has estimated, based upon a Black Scholes model, that the
                  fair value of
                  the purchase option on the date of sale is approximately $0.78
                  per unit (a total
                  value of $368,525), using an expected life of five years, volatility
                  of 9.45%
                  and a risk-free rate of 4.17%. The volatility calculation is based
                  on the
                  average volatility of 16 business combination companies that have
                  completed
                  their public offerings in amounts ranging from $75,000,000 to $150,000,000,
                  but
                  have not yet announced an acquisition, during the period from January
                  1, 2002 to
                  September 26, 2007. Because the Company does not have a trading
                  history, it
                  needed to estimate the potential volatility of the unit price,
                  which will depend
                  on a number of factors which cannot be ascertained at this time.
                  The Company
                  used these companies because management believes that the volatility
                  of these
                  companies is a reasonable benchmark to use in estimating the expected
                  volatility
                  for the Company’s units. Although an expected life of five years was used in the
                  calculation, if the Company does not consummate a business combination
                  within
                  the prescribed time period and the Company is liquidated, the option
                  will become
                  worthless.
  64
 
 ASIA
                  SPECIAL SITUATION ACQUISITION CORP.
 (a
                  corporation in the development stage)
 
 Notes
                  to
                  Financial Statements
 **NOTE
                  4—RELATED PARTY TRANSACTIONS**
 
 On
                  March
                  23, 2007, the Company sold 2,500,000 ordinary shares to the Initial
                  Shareholders
                  for proceeds of $25,000.
  On
                  March
                  23, 2007, the Company entered into an unsecured $500,000 line of
                  credit (the
                  Line) with the majority shareholder of the Company, which is an
                  entity whose
                  chief executive officer is a director of the Company. The Line
                  bears no interest
                  and is due at the earlier of the closing date of the Offering or,
                  as amended,
                  January 31, 2008. On January 23, 2008, such line of credit was
                  paid in
                  full.
  On
                  January 16, 2008, immediately prior to the Offering, the Company’s sponsor, Ho
                  Capital Management, LLC, an entity co-managed and jointly owned
                  by Angela Ho,
                  the Company’s chief executive officer and chairman, and Noble Investment Fund
                  Limited, purchased an aggregate of 5,725,000 warrants, or “insider warrants,” at
                  a price of $1.00 per warrant in a Private Placement. Ho Capital
                  Management LLC
                  and Noble Investment Fund Limited will each have a 50% beneficial
                  ownership
                  interest in the insider warrants. So long as the insider warrants
                  are owned by
                  Ho Capital Management LLC, Noble Investment Fund Limited or Angela
                  Ho, the
                  insider warrants may be exercised on a cashless basis and will
                  not be subject to
                  redemption. The insider warrants may not be sold, assigned or transferred
                  by Ho
                  Capital Management LLC (nor may the members interest in HO Capital
                  Management
                  LLC be sold, assigned or transferred) until the Company has consummated
                  a
                  business combination or (if the Company fails to consummate such
                  business
                  combination ) liquidates. The insider warrants transfer restriction
                  expires on
                  the earlier of (i) a business combination or (ii) the Company’s liquidation.
 
 The
                  sale
                  of the warrants to the Company’s sponsor did not result in the recognition of
                  any stock-based compensation expense because they are being sold
                  above fair
                  market value. The Company has granted the holders of such warrants
                  demand and
“piggy back” registration rights with respect to the 5,725,000 warrants and
                  the
                  5,725,000 shares of ordinary shares underlying the warrants at
                  any time
                  commencing on the date the Company announces that it has entered
                  into a letter
                  of intent with respect to a proposed business combination, provided,
                  however,
                  any such registration shall not become effective until the business
                  combination
                  has been completed. The demand registration may be exercised by
                  the holders of a
                  majority of such warrants. Insider warrants will not be subject
                  to redemption if
                  held by the initial holder thereof or its permitted assigns. Permitted
                  assigns
                  include transfers to Nobel Investment Fund Limited, as partial
                  consideration for
                  the $5,725,000 loan to be provided to Ho Capital Management LLC
                  by Noble to
                  purchase the insider warrants immediately prior to the date of
                  this prospectus,
                  or to Angela Ho, a member of Ho Capital Management LLC; provided
                  that, the
                  insider warrants may not be sold, assigned or transferred until
                  the Company
                  consummates a business combination. The Company will bear the expenses
                  incurred
                  in connection with the filing of any such registration statements.
                  If the
                  Company does not complete a business combination, then the $5,725,000
                  proceeds
                  will be part of the liquidating distribution to Public Shareholders
                  and the
                  warrants issued under the transaction will expire worthless.
 
 The
                  holders of the Company’s initial 2,500,000 issued and outstanding ordinary
                  shares at the time of the Offering will be entitled to registration
                  rights
                  pursuant to an agreement to be signed prior to or on the effective
                  date of the
                  Offering. The holders of the majority of these shares are entitled
                  to make up to
                  two demands that the Company register these shares. The holders
                  of the majority
                  of these shares can elect to exercise these registration rights
                  at any time
                  after the date on which these ordinary shares are released from
                  escrow. In
                  addition, these shareholders have certain “piggy-back” registration rights on
                  registration statements filed subsequent to the date on which these
                  ordinary
                  shares are released from escrow. The Company will bear the expenses
                  incurred in
                  connection with the filing of any such registration statements.
                  The holders of
                  the Company’s initial 2,500,000 issued and outstanding ordinary shares at the
                  time of the Offering placed their initial shares purchased by them
                  into an
                  escrow account maintained by Continental Transfer and Trust Company,
                  acting as
                  escrow agent. The initial shares will not be released from escrow
                  until three
                  years from the date of the Offering, except that following the
                  consummation of a
                  business combination, such shares and members interests may be
                  transferred to
                  family members and trusts of permitted assignees for estate planning
                  purposes,
                  or upon the death of any such person, to an estate or beneficiaries
                  or permitted
                  assignees; in each case, such transferee will be subject to the
                  same transfer
                  restrictions as the Company’s Initial Shareholders until after the shares and
                  members interests are released from escrow.
  65
 ASIA
                    SPECIAL SITUATION ACQUISITION CORP.
 (a
                    corporation in the development stage)
 
 Notes
                    to
                    Financial Statements
 **NOTE
                    5 - INCOME TAXES**
 
 Components
                    of the Company’s deferred tax assets are as follows:
 Net
                            operating loss carry-forward
                        
                        $
                        2,040Less,
                            valuation allowance
                        
                        
                        (2,040
                        )$
                        -
 Management
                    has recorded a full valuation allowance against its deferred
                    tax assets because
                    it does not believe it is more likely than not that sufficient
                    taxable income
                    will be generated. The effective tax rate differs from the statutory
                    rate of 34%
                    due to the establishment of the valuation allowance. The net
                    operating loss
                    carry-forward expires in 2027.
 
 **NOTE
                    6 - SUBSEQUENT EVENT; LINE OF CREDIT**
 
 On
                    February 28, 2008, the Company consummated a Loan and Security
                    Agreement (the
“ Agreement ”)
                    with a
                    bank pursuant to which it issued a $500,000 promissory note to
                    the bank in
                    exchange for a line of credit to be used for working capital
                    and general
                    corporate purposes.
 
 The
                    promissory note bears interest at the banks prime rate (the “ Interest
                    Rate ”)
                    or,
                    upon the occurrence of a default by the Company, at a default
                    rate equal to the
                    Interest Rate plus 2%. Payments of interest are payable monthly
                    commencing on
                    June 1, 2008. All principal and accrued and unpaid interest is
                    due on the
                    earlier of (i) any termination or liquidation of the property
                    or assets
                    maintained in the trust account in connection with our Offering;
                    or (ii)
                    September 1, 2008. Under the Agreement, the Company may elect
                    to prepay, without
                    penalty, all or a portion of the principal amount and accrued
                    and unpaid
                    interest then outstanding under the promissory note in a minimum
                    aggregate
                    amount of $10,000, and in multiples equal to $5,000 in excess
                    of
                    $10,000.
 
 The
                    promissory note is secured by a first priority security interest
                    in (i)
                    distributions or proceeds from the trust account pursuant to
                    the trust agreement
                    and (ii) all deposit accounts into which any of the foregoing
                    distributions or
                    proceeds are disbursed or held. Notwithstanding the foregoing,
                    the bank does not
                    have a security interest in any of the assets and property held in the
                    trust account, and the bank has agreed not to assert any claim
                    against Trust
                    assets or property.
  66






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




On
      September 24, 2007, we were notified that certain partners of Tedder, James,
      Worden & Associates, P.A., our independent registered certified public
      accounting firm, had joined McGladrey & Pullen, LLP and that, as a result,
      effective September 24, 2007, Tedder, James, Worden & Associates, P.A.
      resigned as our independent registered public accounting firm. On September
      24,
      2007, Rothstein, Kass & Company, P.C. was engaged as our independent
      registered public accounting firm. Our decision to engage Rothstein, Kass &
Company, P.C. was approved by our board of directors on September 24, 2007.





The
      audit
      reports of Tedder, James, Worden & Associates, P.A. on our financial
      statements from March 22, 2007 (inception) to April 9, 2007 did not contain
      an
      adverse opinion or disclaimer of opinion and was not qualified or modified
      as to
      uncertainty, audit scope or accounting principles from March 22, 2007
      (inception) to April 9, 2007, except that Tedder, James, Worden &
Associates, P.A.’s opinion in its audit report on our financial statements
      included an emphasis paragraph relating to an uncertainty as to our ability
      to
      continue as a going concern.





From
      March 22, 2007 (inception) to April 9, 2007 through the date of resignation,
      there were no reportable events as such term is described in Item 304(a)(1)(v)
      of Regulation S-K.





From
      March 22, 2007 (inception) to April 9, 2007 through the date of resignation,
      there were no disagreements with Tedder, James, Worden & Associates, P.A. on
      any matters of accounting principles or practices, financial statement
      disclosure or auditing scope or procedure, which, if not resolved to the
      satisfaction of Tedder, James, Worden & Associates, P.A., would have caused
      it to make reference to the subject matter of the disagreements in connection
      with its reports on these financial statements for such period.





We
      did
      not consult with Rothstein, Kass & Company, P.C. regarding the application
      of accounting principles to a specific transaction, either completed or
      proposed, or the type of audit opinion that might be rendered on our financial
      statements, and no written or oral advice was provided by Rothstein, Kass &
Company, P.C. that was a factor considered by us in reaching a decision as
      to
      the accounting, auditing or financial reporting issues.




**ITEM
      9A. CONTROLS AND PROCEDURES**





(a)***Evaluation of Disclosure Controls and Procedures***.
      Based
      on an evaluation of our disclosure controls and procedures (as defined in
      Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of
      1934, as amended) required by paragraph (b) of Rule 13a-15 or
      Rule 15d-15, as of December 31, 2007, our Chief Executive Officer and Chief
      Financial Officer have concluded that our disclosure controls and procedures
      were effective in ensuring that information required to be disclosed by us
      in
      the reports that we file or submit under the Exchange Act is recorded,
      processed, summarized and reported within the time periods specified in the
      Commission's rules and forms. Our Chief Executive Officer and Chief
      Financial Officer also concluded that, as of December 31, 2007, our disclosure
      controls and procedures were effective in ensuring that information required
      to
      be disclosed by us in the reports that we file or submit under the Exchange
      Act
      is accumulated and communicated to our management, including our Chief Executive
      Officer and Chief Financial Officer, to allow timely decisions regarding
      required disclosure.





(b) ***Changes in internal controls*** .
      During
      the year ended December 31, 2007, there were no changes in our internal control
      over financial reporting identified in connection with the evaluation required
      by paragraph (d) of Rule 13a-15 or Rule 15d-15 that has materially affected,
      or
      is reasonably likely to materially affect, our internal control over financial
      reporting.





**Compliance
      with Section 404 of the Sarbanes-Oxley Act of 2002**




This
      annual
      report does not include a report of management’s assessment regarding internal
      control over financial reporting or an attestation report of our registered
      public accounting firm due to a transition period established by the
      rules of the Securities and Exchange for newly public
      companies.




Pursuant
      to
      Section 404 of the Sarbanes-Oxley Act of 2002 (the “Act”), beginning with
      our Annual Report on Form 10-K for the fiscal year ending December 31,
      2008, we will be required to furnish a report by our management on our internal
      control over financial reporting. This report will contain, among other matters,
      an assessment of the effectiveness of our internal control over financial
      reporting as of the end of our fiscal year, including a statement as to whether
      or not our internal control over financial reporting is effective. This
      assessment must include disclosure of any material weaknesses in our internal
      control over financial reporting identified by management. If we identify one
      or
      more material weaknesses in our internal control over financial reporting,
      we
      will be unable to assert our internal control over financial reporting is
      effective. This report will also contain a statement that our independent
      registered public accountants have issued an attestation report on management’s
      assessment of such internal controls and conclusion on the operating
      effectiveness of those controls.




67




Management
      acknowledges its responsibility for internal controls over financial reporting
      and seeks to continually improve those controls. In order to achieve compliance
      with Section 404 of the Act within the prescribed period, we expect to
      perform the system and process documentation and evaluation needed to comply
      with Section 404, which is both costly and challenging. We believe our
      process, which will commence in 2008, for documenting, evaluating and monitoring
      our internal control over financial reporting is consistent with the objectives
      of Section 404 of the Act.





**ITEM
      9B. OTHER INFORMATION.**





None.





**PART
      III**




**ITEM
      10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE
      GOVERNANCE.**





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





**Name**
            
            **Age**
            
            **Position**Angela
                Ho
            
            54
            
            Chief
                Executive Officer and Chairman of the Board of
                DirectorsDr.
                Gary T. Hirst
            
            55
            
            President
                and DirectorMichael
                Hlavsa
            
            54
            
            Chief
                Financial Officer, Secretary and DirectorAndrew
                Tse
            
            54
            
            Vice
                PresidentPeter
                Kjaer
            
            46
            
            Director
                and Chief Operating OfficerStuart
                A. Sundlun
            
            54
            
            DirectorArie
                Jan van Roon
            
            63
            
            Director





**Angela
      Ho** has
      served as our Chief Executive Officer and Chairman of the Board of Directors
      since our inception in March 2007. From 1996 to 2006, Ms. Ho has also managed
      various family businesses controlled by her father, Dr. Stanley Ho, including
      Jet Asia Ltd. and drho888.com, which are engaged in the business of aviation
      and
      Asian computer gaming operations, respectively. From 1981 to the present, Ms.
      Ho
      has also been active in several aspects of the fine art business. From 1980
      to
      1987, she worked as a sculptress exhibiting in a number of major galleries
      and
      museums, and was employed at Sotheby’s Fine Arts Department, New York. In 1980,
      she became a lead investor in the Tony Shafrazi Gallery. From 1996 to 1999,
      she
      established and managed her own gallery when she founded the Ho Gallery, a
      gallery of contemporary art in New York. The gallery was instrumental in
      pioneering the contemporary Chinese art market in New York and introducing
      contemporary Chinese artists to North America. In 1997, she founded the Center
      of Contemporary Art in Macau, a private museum dedicated to the dialogue between
      contemporary artists in Asia and the West. From 1996 to 2003, Ms. Ho served
      as a
      member of the board of directors of BioSante, a pharmaceutical company listed
      on
      the American Stock Exchange. From 1996 to 2001, she managed Successway Holdings
      Limited, a technology venture capital fund on behalf of her father, Dr. Stanley
      Ho. From 1999 to 2004, she served on the board of directors of the School of
      American Ballet. She was educated in private academies in Hong Kong, Switzerland
      and London and earned her Bachelor of Fine Arts degree from Boston University
      in
      1979.





**Dr.
      Gary T. Hirst** was
      originally appointed as our Co-Chief Executive Officer on an interim basis,
      Dr.
      Hirst was appointed as our President in October 2007. He has been a director
      of
      our company since our inception. Dr. Hirst has been responsible for the
      development and investment management of both offshore and domestic hedge funds,
      including global macro funds, funds-of-funds, currency funds, and a number
      of
      structured investment products (synthetic investment instruments, typically
      created by combining securities, such as notes or common stock, with derivatives
      such as options, that are specially created to meet specific needs that cannot
      be met from the standard financial instruments available in the markets)
      including for principal protected notes issued by Zurich Capital Markets and
      Rabobank which invested in diversified global portfolios of hedge funds. From
      1991 to 2006, Dr. Hirst was Chairman and Chief Investment Officer of Hirst
      Investment Management. In his roles with Hirst Investment Management, Dr. Hirst
      managed over $600 million in assets on behalf of multi-national banks, pension
      plans, insurance companies, foundations and endowments, public companies, family
      offices and high net worth investors. Under his leadership, the firm established
      itself as a developer of innovative financial products and services, with a
      focus on maximizing the risk-adjusted return on its clients’ investments. From
      1976 to 1991, Dr. Hirst was Investment Manager for the Hirst Family Office
      where
      he managed allocation and trading for all investment portfolios of the Hirst
      family and its associates. These investments included traditional asset
      portfolios, real estate, and a range of alternate investment strategies
      including hedge funds, private equity, futures trading and physical commodities.
      From 2003 to 2005, Dr. Hirst was a director of Alpine Select A.G., a publicly
      traded (Swiss Exchange) investment company based in Zug, Switzerland.




68





**Michael
      Hlavsa** has
      been
      our Chief Financial Officer and a director since our inception and was appointed
      as our Secretary in January 2008. Mr. Hlavsa is an experienced executive that
      has over 30 years of combined financial and operational experience. He is both
      a
      Certified Public Accountant and a Certified Internal Auditor. He has spent
      over
      18 years working in the United States casino industry. From 2004 to the present,
      he has been the founder and principal owner of Signature Gaming Management
      LLC,
      a consulting firm specializing in advising emerging companies engaged in gaming
      operations. In 2005, he served as Chief Executive Officer for Titan Cruise
      Lines, a casino business which operated a 2,000 passenger ship and high speed
      shuttles. From 2001 to 2004, Mr. Hlavsa was the Chief Executive Officer for
      SunCruz Casinos, the largest day cruise gaming company in the United States.
      From 1997 to 2000, Mr. Hlavsa was Managing Partner at Casino Princesa in Miami,
      Florida where he was responsible for the development and operation of a large
      mega-yacht gaming vessel. From 1993 to 1997, he served as Chief Financial
      Officer and Vice President, Midwest region, for Lady Luck Gaming Corporation,
      a
      publicly traded company. While at Lady Luck, he participated in that company’s
      initial public offering of equity and a $185 million debt financing. From 1991
      to 1993, Mr. Hlavsa was the Vice President of Finance and Administration for
      the
      Sands Hotel and Casino in Las Vegas, Nevada. His first 12 years of gaming
      experience was in Atlantic City, New Jersey in various audit and finance
      positions with well-established gaming companies such as Caesars, Tropicana
      and
      Trump Plaza. He received a bachelor of science degree from Canisius College
      in
      Buffalo, New York in 1975.





**Andrew
      Tse** has
      served as our Vice President since our inception. From 1981 to 2006, Mr. Tse
      was
      associated with a number of businesses located in China (Hong Kong and Macau)
      that are owed or controlled by Dr. Stanley Ho, the father of our chairman and
      co-chief executive officer, Angela Ho, including Shun Tak Holdings Ltd., Heli
      Express Ltd. and Hong Kong Express Airways Ltd. which are engaged in the
      business of sea transport, helicopter transport and scheduled airline services,
      respectively. From 1981 to 2006, Mr. Tse was an executive director, and from
      1989 to 1996 served as the chief financial officer and a member of the board
      of
      directors of, Shun Tak Holdings Limited. Shun Tak Holdings Limited is a leading
      Hong Kong-based conglomerate established in 1972 and listed on the Hong Kong
      Stock Exchange since 1973 with core businesses in transportation, casino
      investment and operations and property investments. During his tenure with
      Shun
      Tak, Mr. Tse was instrumental in listing the company on the Hong Kong Stock
      Exchange and was instrumental in negotiating and financing many of Shun Tak’s
      acquisitions and business expansion initiatives. From 1989 to 2003, Mr. Tse
      served as executive director of Air Hong Kong Ltd., a dedicated cargo airline
      based in Hong Kong offering scheduled service to Europe and the United States.
      Mr. Tse was instrumental in the sale of Air Hong Kong to Cathay Pacific Airways
      in 2003. From 1997 to 2006, Mr. Tse also served as chief executive officer
      of
      Heli Express Limited, a helicopter airline operating between Hong Kong and
      Macau, with more than 50 daily flights. From 1997 to the present, Mr. Tse has
      served as the founder and chief executive officer of Hong Kong Express Airways
      Limited, a new regional airline that commenced operation in 2005 and provides
      scheduled Boeing 737 and Embraer E170 service between Hong Kong and secondary
      cities in Mainland China and Taiwan. A 1977 graduate of McMaster University
      in
      Canada, Mr. Tse also received an MBA from McMaster University in 1978.





**Peter
      Kjaer** has
      served as a director since our inception and was appointed as our Chief
      Operating Officer on March 25, 2008. From 1995 to 2006, Mr. Kjaer was associated
      with certain businesses controlled or financed by Dr. Stanley Ho, including
      Jet
      Asia and Macau Business Aviation Center, which are engaged in the business
      of
      providing corporate air charter and fixed based operation services,
      respectively. In 1992, he co-founded, with Angela Ho, the Ho Gallery, one of
      the
      leading contemporary art galleries in Asia. In 1996, in partnership with STDM,
      an affiliate of Stanley Ho, Mr. Kjaer founded Jet Asia Ltd., a business aviation
      charter company located in Hong Kong and served as its president and chief
      executive officer until 2003. From 1999 to the present, Mr. Kjaer has been
      a
      member of the board of directors and a member of the audit and finance committee
      of BioSante Inc., a pharmaceutical company listed on the American Stock Exchange
      and from 2004 to the present, has served as the founder and chief executive
      officer of Ho Gaming Ltd., a software company that has developed webcasting
      software, including applications for online entertainment focused on the Asian
      gaming market. A student of Sinology for four years at the University of
      Copenhagen, Mr. Kjaer speaks, reads and writes Chinese and studied modern
      economic reform in Shanghai in 1985.





**Stuart
      A.
      Sundlun** has
      served as a director since our inception in March 2007. Originally appointed
      as
      our President on an interim basis, Mr. Sundlun resigned such office in October
      2007. From September 2007 to the present, Mr. Sundlun has been Managing Director
      of BMB Advisors Ltd, a company providing financial advisory services to the
      BMB
      Group SPC, an alternative asset management firm investing in privately-owned
      hedge funds, real estate funds, private equity funds and direct investments.
      From 1998 to September 2007, Mr. Sundlun was a managing director of Global
      Emerging Markets, a New York City based investment fund that acquires and
      invests in both public and privately owned businesses. From 1998 to the present,
      Mr. Sundlun has been actively involved in structuring and negotiating equity
      investments in emerging growth companies including Digital River, Inc., Star
      Scientific, Inc and Intercontinental Fuels, LLC. From 2001 to the present,
      Mr.
      Sundlun has been an advisor to Triago SA, a Paris based leading placement agent
      for private equity funds. From 1994 to the present, Mr. Sundlun has structured
      a
      variety of private equity investments in Russia including South Oil Corporation,
      which is developing an oil field in Astrakhan, Russia and Helios Petroleum
      Holdings, AG, which intends to own and operate many oil refineries in Russia
      and
      elsewhere. Mr. Sundlun serves on the board of South Oil Corporation. From 2005
      to the present, Mr. Sundlun has also served on the Board and investment
      committee of the Dignity Fund LLC, which makes loans to microfinance
      institutions. From 1986 to 1994, Mr. Sundlun was a Managing Director of
      Grosvenor Equities, Inc. and participated in the raising of equity for a variety
      of private companies including early stage venture capital, growth stage and
      leveraged management buyouts. From 1982 to 1985, he was an associate in the
      Corporate Finance department of Lehman Brothers and advised a variety of medium
      and large corporations on financial strategies and financing. Mr. Sundlun
      received his BA degree cum laude 1975 (government) from Harvard University,
      and
      his MBA (finance) from Columbia University Graduate School of Business in 1982.




69





**Arie
      Jan van Roon** has
      served as a director since our inception. From January 2000 to the present,
      he
      has served as the managing partner of TransTax LLP, a Swiss-based private wealth
      management firm. The firm provides financial advisory services to high net
      worth
      investors and family offices principally within the European Union. In January
      2007, he established Pure Glow Finance Limited of which he is the Managing
      Director as well as the sole shareholder, with the same activities as TransTax
      LLP and also the beneficial owner and investment advisor of Noble Investment
      Fund Limited, one of our principal shareholders. Prior to founding this firm,
      from 1984 to 2000, Mr. van Roon established van Roon Partners, Ltd., a private
      equity and advisory firm with an emphasis on investment in distressed, turn
      around and special situations with a geographic focus on Europe and across
      a
      wide range of industries. In addition to investment management experience,
      during this period he also developed operational experience in his capacity
      as
      acting interim CEO for investee companies in the consumer goods, airline and
      service industries including Girmi spa, an Italian industrial firm, Intair
      GMBH,
      an airline handling company based in Germany, and Aerolloyd, a German airline.
      In 1990, Mr. van Roon entered into a joint venture arrangement with US-based
      Quantum Development Corporation, a boutique venture capital firm specializing
      in
      early stage high tech and pharmaceutical companies. In connection with this
      activity, from January 2000 to May 2000 he acted as interim CEO of Alyn
      Corporation, a NASDAQ listed innovative materials firm. Mr. van Roon has never
      been employed by any of the above companies and has always acted as a consultant
      or owner. Mr. van Roon is a Dutch citizen who lives in Lugano, Switzerland
      and
      in Milan, Italy. He obtained a doctoral degree (Drs) from Erasmus Rotterdam
      University in 1971, where his thesis centered on Bayesian Statistics.





Our
      board
      of directors is currently divided into two classes, each of which will generally
      serve for a term of two years with only one class of directors being elected
      in
      each year. There is no cumulative voting with respect to the election of
      directors, with the result that the holders of more than 50% of the shares
      eligible to vote for the election of directors can elect all of the directors.




These
      individuals will play a key role in identifying and evaluating prospective
      acquisition candidates, selecting the target business and structuring,
      negotiating and consummating its acquisition. 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. However, we believe
      the
      skills and expertise of these individuals, their collective access to
      acquisition opportunities and ideas, their contacts, and their transaction
      expertise with public and private companies should enable them to identify
      and
      effect an acquisition although we cannot assure you that they will, in fact,
      be
      able to do so.


**Board
        of Advisors**
 
 In
        addition
        to our executive officers and directors, the following individuals have agreed
        since our inception to serve as members of our board of advisors. It is
        anticipated that our board of advisors will provide professional advice and
        assistance to our board of directors in evaluating and structuring potential
        business combination opportunities. No member of our board of advisors has
        received any cash compensation for services rendered. No compensation of
        any
        kind, including finder’s and consulting fees, will be paid to any of our
        advisors for services rendered prior to or in connection with a business
        combination. However, these individuals will be reimbursed for any out-of-pocket
        expenses incurred in connection with activities on our behalf such as providing
        professional advice and assistance in identifying potential target businesses
        and performing due diligence on suitable business combinations. There is
        no
        limit on the amount of these out-of-pocket expenses and there will be no
        review
        of the reasonableness of the expenses by anyone other than our board of
        directors, which includes persons who may seek reimbursement, or a court
        of
        competent jurisdiction if such reimbursement is challenged.
 
 **Adam
        Hart** is
        managing director-equities, corporate finance, at Fairfax I.S. PLC, an
        investment bank based in London focusing on small and mid-cap companies listed
        on the London Stock Exchange and other international exchanges. He joined
        Fairfax I.S. PLC in 2007. For approximately 14 years prior thereto, Mr. Hart
        served in various capacities including, head of business development at KBC
        Peel
        Hunt, another London-based investment bank, which he joined in 1993 from
        Lloyds
        Merchant Bank, the investment banking subsidiary of Lloyds Bank PLC (now
        Lloyds
        TSB PLC). He has been involved in a lead advisory role across a range of
        corporate finance transactions such as IPOs, mergers and acquisitions and
        secondary fundraisings as well as private equity financings in London. Mr.
        Hart
        is Chairman of the London Stock Exchange’s AIM Advisory Group which is made up
        of external practitioners who advise the Exchange on all matters affecting
        the
        operation and regulation of AIM, a member of the AIM Disciplinary Panel and
        is a
        past member of the Corporate Finance Technical Committee of the Institute
        of
        Chartered Accountants in England and Wales. Mr. Hart has a bachelor’s degree in
        law and became qualified as a chartered accountant with Touche Ross & Co.
        (now Deloitte & Touche LLP).
  70
 
 **Dr.
        Rory Knight** is
        Chairman of the Oxford Metrica group, an independent strategic advisor that
        provides research-based intelligence on all aspects of financial performance.
        Dr. Knight has extensive experience in working and consulting in the financial
        and corporate sectors. For five years, he was Dean of Templeton College,
        University of Oxford (Oxford University’s business college), where he was
        responsible for Templeton’s overall strategy and direction. Dr. Knight is Dean
        Emeritus at Templeton and Fellow in Finance. He has been published widely
        on
        investments in the Financial Times and other journals. While Dean at Oxford
        he
        co-authored Financial Performance (Butterworth-Heinemann) and devised the
        Value
        Creation Quotient (VCQ TM )
        a key
        financial performance metric. Previously a Deputy Director in the Swiss National
        Bank (SNB), Dr. Knight’s role included providing policy advice on international
        financial matters. He is currently on the Board of Advisors of the John
        Templeton Foundation, which was established by Sir John Templeton.
 
 **James
        Tagliaferri** is the
        controlling shareholder of Taurus Advisory Group Inc., Taurus Advisory Group
        LLC
        of Stamford, Connecticut and TAG Virgin Islands Inc. of St. Thomas, US Virgin
        Islands. Taurus is an asset management firm founded in 1983 by Mr. Tagliaferri
        that provides asset management services on a discretionary basis principally
        to
        high net worth individuals, as well as certain non-discretionary asset
        management. Mr. Tagliaferri manages fixed income and equity portfolios,
        including various strategies tailored for individual client objectives. Taurus
        is also an investor in private placements and corporate finance transactions,
        including leading the negotiation and structuring of equity and debt instruments
        from public and private issuers. Mr. Tagliaferri has been in the investment
        business since 1967, having previously been an asset manager at Julius Baer
        Group, and Lionel Edie & Company, the investment management division of
        Manufacturers Hanover Trust, which was merged into Chase Bank. Taurus is
        a
        Certified Financial Analyst and a registered investment advisor with the
        Securities and Exchange Commission pursuant to the Investment Advisors Act
        of
        1940.
 
 **Director
        Independence**
 
 At
        present, we have only one director who qualifies as independent under the
        Sarbanes-Oxley Act of 2002 and for purposes of compliance with the American
        Stock Exchange requirements applicable to United States companies.
  Pursuant
        to the listing requirements of the American Stock Exchange and the
        Sarbanes-Oxley Act of 2002, we are required to have an independent audit
        committee. Prior to completion of a business combination, we intend to be
        in
        full compliance with the standards imposed by the American Stock Exchange
        and
        the Sarbanes-Oxley Act of 2002.
 
 **Board
        Committees**
 
 Our
        board
        of directors has established an audit committee, a nominating committee and
        a
        compensation committee and has adopted charters for these committees.
 
 Our
        audit
        committee consists of Messrs. Kjaer (chairman), Sundlun and Hirst. Each member
        of our audit committee is financially literate under the current listing
        standards of the American Stock Exchange, and our board of directors has
        determined that Dr. Hirst qualifies as an “audit committee financial expert,” as
        such term is defined by SEC and the American Stock Exchange rules.
 
 The
        audit
        committee will review the professional services and independence of our
        independent registered public accounting firm and our accounts, procedures
        and
        internal control. The audit committee will also select our independent
        registered public accounting firm, review and approve the scope of the annual
        audit, review with the independent public accounting firm our annual audit
        and
        annual consolidated financial statements, review with management the status
        of
        internal accounting control, evaluate problem areas having a potential financial
        impact on us that may be brought to the committee’s attention by management, the
        independent registered public accounting firm or the board of directors,
        and
        evaluate all of our public financial reporting documents.
 
 Our
        nominating committee consists of Angela Ho, Dr. Gary T. Hirst, Stuart Sundlun
        and Michael Hlvasa, with Ms. Ho serving as chairman of the nominating committee.
        The nominating committee is responsible for selecting, researching and
        nominating directors for election by our shareholders, selecting nominees
        to
        fill vacancies on the board or a committee of the board, developing and
        recommending to the board a set of corporate governance principles and
        overseeing the evaluation of the board and our management.
 
 Our
        compensation committee consists of Messrs. Stuart Sundlun and Dr. Gary T.
        Hirst.
        Once we have completed a business combination, our board of directors will
        determine that all members of the compensation committee qualify as independent
        directors under the American Stock Exchange independence standards. The
        principal function of the compensation committee is to review the compensation
        payable to our officers and directors.
  71
 
 The
        composition of our audit committee, our nominating committee and our
        compensation committee may change when we complete a business combination.
        However, the names and business experience of any new or additional members
        of
        such audit committee will be included in the proxy statement submitted to
        our
        public shareholders in connection with their approval of such business
        combination.
 
 **Family
        Relationships**
  There
        are no
        family relationships among our executive officers and directors.
 
 **Involvement
        in Certain Legal Proceedings.**
  None
        of our
        officers or directors have, during the last five years: (i) been convicted
        in or is currently subject to a pending a criminal proceeding; (ii) been a
        party to a civil proceeding of a judicial or administrative body of competent
        jurisdiction and as a result of such proceeding was or is subject to a judgment,
        decree or final order enjoining future violations of, or prohibiting or
        mandating activities subject to any federal or state securities or banking
        laws
        including, without limitation, in any way limiting involvement in any business
        activity, or finding any violation with respect to such law, nor (iii) has
        any bankruptcy petition been filed by or against the business of which such
        person was an executive officer or a general partner, whether at the time
        of the
        bankruptcy of for the two years prior thereto.
 
 **Code
        of Conduct and Ethics**
 
 We
        have
        adopted a code of conduct and ethics applicable to our directors, officers
        and
        employees in compliance with applicable federal securities laws and the rules
        of
        the American Stock Exchange.
  **ITEM
        11. EXECUTIVE COMPENSATION**
  No
        executive officer has received any cash compensation for services rendered.
        No
        compensation of any kind, including finder’s and consulting fees, will be paid
        to any of our initial shareholders, including our officers and directors
        and our
        Sponsor or any of their respective affiliates, for services rendered prior
        to or
        in connection with a business combination. However, these individuals will
        be
        reimbursed for any out-of-pocket expenses incurred in connection with activities
        on our behalf such as identifying potential target businesses and performing
        due
        diligence on suitable business combinations. There is no limit on the amount
        of
        these out-of-pocket expenses and there will be no review of the reasonableness
        of the expenses by anyone other than our board of directors, which includes
        persons who may seek reimbursement, or a court of competent jurisdiction
        if such
        reimbursement is challenged.
 
 Upon
        completion of a business combination or our liquidation, we will no longer
        be
        required to pay these monthly fees. No compensation of any kind, including
        finder’s and consulting fees, will be paid to any of our initial shareholders,
        including our directors, or any of their respective affiliates for services
        rendered prior to or in connection with a business combination. However,
        our
        initial shareholders will be reimbursed for any out-of-pocket expenses incurred
        in connection with activities on our behalf such as identifying potential
        target
        businesses and performing due diligence on suitable business combinations.
        Such
        individuals may be paid consulting, management or other fees from target
        businesses as a result of the business combination, with any and all amounts
        being fully disclosed to shareholders, to the extent then known, in the proxy
        solicitation materials furnished to the shareholders. There is no limit on
        the
        amount of these out-of-pocket expenses and there will be no review of the
        reasonableness of the expenses by anyone other than our board of directors,
        which includes persons who may seek reimbursement, or a court of competent
        jurisdiction if such reimbursement is challenged.
 
 **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 our
        ordinary shares as of March 27, 2008 by:
 · each
          person known by us to be the beneficial owner of more than 5% of our outstanding
          ordinary shares;
 · each
          of
          our officers and directors; and
 · all
          our
          officers and directors as a group.
 
 Based
        on
        information available to us, all persons named in the table have sole voting
        and
        investment power with respect to all ordinary shares beneficially owned by
        them,
        unless otherwise indicated. Beneficial ownership is determined in accordance
        with Rule 13d-3 under the Securities Exchange Act of 1934, as amended. In
        computing the number of ordinary shares beneficially owned by a person or
        a
        group and the percentage ownership of that person or group, ordinary shares
        subject to options or warrants currently exercisable or exercisable within
        60
        days after the date of our prospectus are deemed outstanding, but are not
        deemed
        outstanding for the purpose of computing the percentage of ownership of any
        other person.
  72




**Name
                  of Beneficial Owner (1)**
              
              
              **Number
                  of**
                **Shares
                  (1)**
              
              
              **Percentage
                  of Shares Beneficially**
                **Owned
                  (2)**Ho
                  Capital Management LLC(3)
                386
                  Columbus Avenue, Apt. 17A
                New
                  York, New York 10024
              
              
              1,312,500
                  shares
              
              
              9.4
              %Angela
                  Ho(3)
                386
                  Columbus Avenue, Apt. 17A
                New
                  York, New York 10024
              
              
              1,312,500
                  shares
              
              
              9.4
              %Noble
                  Investment Fund Limited(4)
                c/o
                  Pure Glow Finance Limited, investment advisor
                World
                  Trade Centre, Via Lugano 11
                6982
                  Lugano-Agno Switzerland
              
              
              1,812,500
                  shares
              
              
              13.0
              %Arie
                  Jan van Roon(4)
                World
                  Trade CentreVia Lugano 11
                6982
                  Lugano-Agno
                Switzerland
              
              
              1,937,500
                  shares
              
              
              13.8
              %Allius
                  Ltd.(5)
                Harbour
                  House, Second Floor
                Waterfront
                  Drive, Road Town
                Tortola,
                  British Virgin Islands
              
              
              500,000
                  shares
              
              
              3.6
              %Dr.
                  Gary T. Hirst(6)
                1515
                  International Parkway, Suite 2031
                Lake
                  Mary, FL 32746
              
              
              625,000
                  shares
              
              
              4.5
              %Stuart
                  A. Sundlun
                BMB
                  Advisors Ltd.
                399
                  Park Avenue, 39thFloor
                New
                  York, New York 10022
              
              
              125,000
                  shares
              
              
              *
              %Andrew
                  Tse
                Apartment
                  26B The Albany
                No.
                  1 Albany Road, Hong Kong
              
              
              125,000
                  shares
              
              
              *
              %Peter
                  Kjaer
                24B
                  Monmouth Place
                9L
                  Kennedy Road
                Hong
                  Kong
              
              
              125,000
                  shares
              
              
              *
              %Michael
                  Hlavsa
                5
                  11 SE 5th Ave., #621
                Ft.
                  Lauderdale, FL 33301
              
              
              62,500shares
              
              
              ***All
                  directors and executive officers as a group (7
                  persons)**
              
              
              **4,312,500
                  shares**
              **(7)**
              
              **30.8**
              **%(7)**


*Less
      than 1%





(1)
      The
      percentage ownership before and after the offering for all executive officers
      and directors does not include the ordinary shares underlying the insider
      warrants as such warrants may be exercised only during the period commencing
      on
      the later of: (i) the consummation by us of a business combination, or (ii)
      January 16, 2009.




73


(2)
      Includes the sale of 11,500,000 units in our offering, including the 1,500,000
      units covering the underwriter’s over allotment option, but not: (a) the
      exercise of the 10,000,000 warrants to purchase ordinary shares included in
      such
      units, (b) the exercise of the 5,725,000 insider warrants to purchase ordinary
      shares as described herein, (c) an aggregate of 475,000 ordinary shares included
      in the representative’s unit purchase option or (d) an aggregate of 475,000
      ordinary shares underlying warrants included in the representative’s unit
      purchase option.





(3)
      Ho
      Capital Management LLC was formed solely for the purpose of owning ordinary
      shares and insider warrants in our company. Angela Ho owns 66.7% of the members
      interests in Ho Capital Management LLC. The remaining 33.3% of the members
      interests in Ho Capital Management LLC are owned by Noble Investment Fund
      Limited. Angela Ho and Noble Investment Fund Limited jointly control and
      co-manage Ho Capital Management LLC and therefore share voting, investment
      and
      dispositive power over all assets of Ho Capital Management LLC (including our
      ordinary shares and insider warrants). Thus, the shares listed under Ms. Ho’s
      name include all shares owned by Ho Capital Management LLC. These shares include
      437,500 shares beneficially owned by Noble Investment Fund Limited which has
      a
      right to receive legal ownership to such shares upon consummation of a business
      combination (see footnote (4) below). This share amount does not include a
      50%
      beneficial interest held by Angela Ho in the 5,725,000 insider warrants to
      be
      issued to the Sponsor immediately prior to the date of our prospectus, and
      the
      5,725,000 ordinary shares issuable upon exercise of the insider warrants. The
      members of Ho Capital Management LLC have agreed that their members interest
      may
      not be transferred, sold or assigned for three years. In addition, each of
      Angela Ho and Noble Investment Fund Limited, the members of Ho Capital
      Management LLC, have agreed that prior to the consummation of a business
      combination, they will not withdraw as members of such entity. See “Certain
      Relationships and Related Transactions and Director Independence”
below.





(4)
      Noble
      Investment Fund Limited is a Gibralter-based company that invests and manages
      portfolio investments of other investment funds. Mr. van Roon is the natural
      person with sole voting, investment and dispositive power over all assets of
      Noble Investment Fund Limited (including our ordinary shares and insider
      warrants), and shares listed in the table as beneficially owned by him include
      those owned by Noble Investment Fund Limited. Mr. van Roon is also the sole
      shareholder, officer and director of Pure Glow Finance Limited, the sole
      investment advisor of Noble Investment Fund Limited. Noble Investment Fund
      Limited owns 33.3% of the membership interests in Ho Capital Management LLC.
      Under the terms of the operating agreement of Ho Capital Management LLC, Noble
      Investment Fund Limited has a beneficial interest in 437,500 shares or 33.3%
      of
      the 1,312,500 shares owned by Ho Capital Management LLC, and upon consummation
      of a business combination, has the right to withdraw as a member of Ho Capital
      Management LLC and receive a distribution of 437,500 ordinary shares as well
      as
      50% of the ,725,000 insider warrants to be owned by Ho Capital Management LLC.
      However, the amount of shares listed for each of Mr. van Roon and for Noble
      Investment Fund Limited includes all of the 1,312,500 shares beneficially owned
      by Ho Capital Management LLC because Ms. Ho and Noble Investment Fund Limited
      jointly control Ho Capital Management LLC, and, as such, share voting and
      dispositive control over its shares. The amount of shares listed for each of
      Mr.
      van Roon and for Noble Investment Fund Limited includes 500,000 shares
      beneficially owned by them through Allius Ltd. This does not include a 50%
      beneficial interest in the 5,725,000 insider warrants to be issued to the
      Sponsor immediately prior to the date of our prospectus, and the 5,725,000
      ordinary shares issuable upon exercise of the insider warrants. See “Certain
      Relationships and Related Transactions and Director Independence”
below.





(5)
      Allius Ltd. is a British Virgin Islands company formed by Dr. Gary T. Hirst,
      our
      president and director, and Noble Investment Fund Limited, for the purpose
      of
      owing ordinary shares in our company. Dr. Hirst and Noble Investment Fund
      Limited each own 50% of the outstanding members interests in Allius Ltd. and
      are
      co-managers of Allius Ltd. Accordingly, shares listed for each of Dr. Hirst
      and
      Noble Investment Fund Limited include all shares owned by Allius Ltd. and
      125,000 shares owned directly by Dr. Gary Hirst. The members of Allius Ltd.
      have
      agreed that their members interest in Allius Ltd. may not be transferred, sold
      or assigned for three years. In addition, each of Dr. Gary T. Hirst and Noble
      Investment Fund Limited, the members of Allius Ltd., have agreed that prior
      to
      the consummation of a business combination, they will not withdraw as members
      of
      such entity. See “Certain Relationships and Related Transactions and Director
      Independence” below.





(6)
      Includes 125,000 shares owned directly by Dr. Gary Hirst and 500,000 shares
      indirectly owned through Dr. Hirst’s 50% beneficial interest in Allius
      Ltd.





(7)
      These
      amounts reflect “beneficial” ownership rather than actual ownership by our
      directors and executive officers resulting in total beneficial ownership before
      the offering exceeding our total shares outstanding by 500,000 shares. Under
      the
      definition of “beneficial” ownership in Rule 13d-1 of the Exchange Act, we are
      required to include 500,000 shares owned by Allius Ltd. in the amounts for
      each
      of Dr. Hirst and Mr. van Roon because they are each deemed to control Allius
      Ltd. Similarly, we are required to include the 1,312,500 shares owned by Ho
      Capital Management LLC in the amounts for each of Ms. Ho and Mr. van Roon.
      As a
      result, these shares are being counted twice in the calculation of total shares
      beneficially owned by our directors and officers. Actual ownership after the
      offering for all initial shareholders is 20%.




74





Our
      initial shareholders, which include all of our officers and directors,
      collectively, beneficially own approximately 20% of our issued and outstanding
      ordinary shares. Because of this ownership block, these shareholders may be
      able
      to effectively influence the outcome of all matters requiring approval by our
      shareholders, including the election of directors and approval of significant
      corporate transactions other than approval of a business combination.





All
      of
      our ordinary shares outstanding prior to the date of our prospectus were placed
      in escrow with Continental Stock Transfer & Trust Company, as escrow agent,
      until the earliest of:





·
            three
                years following the date of our prospectus;
                or


·
            the
                consummation of a liquidation, stock exchange, asset acquisition,
                stock
                purchase or other similar transaction, which results in all of our
                shareholders having the right to exchange their ordinary shares for
                cash,
                securities or other property subsequent to our consummating a business
                combination with a target business.





During
      the
      escrow period, the holders of these shares will not be able to sell or transfer
      their securities except that, such initial shares may be transferred to family
      members and trusts of permitted assignees for estate planning purposes, or
      upon
      the death of any such person, to an estate or beneficiaries of permitted
      assignees; in each case, such transferee will be subject to the same transfer
      restrictions as our initial shareholders until after the shares are released
      from escrow and will retain all other rights as our shareholders including,
      without limitation, the right to vote their ordinary shares and the right to
      receive cash dividends, if declared. If dividends are declared and payable
      in
      ordinary shares, such dividends will also be placed in escrow. Any shares held
      by these transferees would remain subject to the stock escrow agreement. In
      addition, the shares will not be released from escrow until three years after
      the date of our prospectus, unless we consummate a transaction after the
      consummation of the initial business combination which results in all of the
      shareholders of the combined entity having the right to exchange their ordinary
      shares for cash, securities or other property. If we are unable to effect a
      business combination and liquidate, none of our initial shareholders will
      receive any portion of the liquidation proceeds with respect to ordinary shares
      owned by them prior to the date of our prospectus.





The
      insider warrants purchased by our Sponsor on January 16, 2008 contain
      restrictions prohibiting their transfer until the earlier of a business
      combination or our liquidation and will be held in an account maintained by
      the
      Maxim Group LLC until such time. Our Sponsor and Noble Investment Fund Limited
      each have a 50% beneficial ownership interest in the insider warrants.





All
      of
      our officers, directors and principal shareholders will be deemed to be our
      “parents” and “promoters” as these terms are defined under the federal
      securities laws.





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





On
      March
      23, 2007, we issued an aggregate of 1,312,500 ordinary shares to our Sponsor,
      Ho
      Capital Management LLC and an aggregate of 1,187,500 ordinary shares certain
      of
      our officers and directors and their affiliates, for a total of $25,000 in
      cash,
      or a purchase price of $0.01 per share. Ho Capital Management LLC is co-managed
      and jointly owned by Angela Ho, our chief executive officer and chairman of
      our
      board of directors.





The
      ordinary shares owned by our Sponsor and the 1,187,500 ordinary shares owned
      by
      our officers and directors and their affiliates, were placed in escrow and
      may
      not be sold, transferred or assigned for a period of three years from the date
      of completion of our offering, except for estate planning purposes.





The
      holder of these shares will be entitled to make up to two demands that we
      register these shares pursuant to an agreement signed on January 16, 2008.
      The
      holders of the majority of these shares may elect to exercise these registration
      rights at any time after the date on which these ordinary shares are released
      from escrow, which, except in limited circumstances, is not before three years
      from the date of our prospectus. In addition, these shareholders have certain
      “piggy-back” registration rights on registration statements filed subsequent to
      the date on which these ordinary shares are released from escrow. We will bear
      the expenses incurred in connection with the filing of any such registration
      statements.





On
      January 16, 2008, Ho Capital Management LLC, which is co-managed and jointly
      owned by Angela Ho, our chief executive officer and chairman of our board of
      directors and Noble Investment Fund Limited, purchased an aggregate of 5,725,000
      insider warrants, from us at a price of $1.00 per warrant in a private placement
      made in accordance with Regulation D under the Securities Act of 1933, as
      amended. All of the proceeds received from the insider warrants (an aggregate
      of
      $5,725,000) were placed in the trust account together with the net proceeds
      of
      our offering. Ho Capital Management LLC and Noble Investment Fund Limited each
      have a 50% beneficial ownership interest in the insider warrants. So long as
      the
      insider warrants are owned by Ho Capital Management LLC, Noble Investment Fund
      Limited or Angela Ho (a co-manager of Ho Capital Management LLC), the insider
      warrants may be exercised on a cashless basis and will not be subject to
      redemption.





75





On
      January 16, 2008, Noble Investment Fund Limited loaned $5,725,000 to Ho Capital
      Management LLC, our Sponsor, to enable the Sponsor to purchase the 5,725,000
      insider warrants. The $5,725,000 loan bears interest at the rate of 4.5% per
      annum and is payable, together with accrued interest, five years from the date
      of issuance (but subject to mandatory prepayment to the extent of any net
      proceeds received by Ho Capital Management LLC from the sale of any insider
      warrants or shares issuable upon exercise of such warrants). Ho Capital
      Management LLC used the proceeds of such loan to purchase the insider warrants.
      The insider warrants were pledged to Noble to secure repayment of such loan.
      In
      the event and upon our consummation of a business combination, the record and
      beneficial ownership of 2,862,500 insider warrants, or 50% of such insider
      warrants will be transferred by Ho Capital Management LLC to Noble Investment
      Fund Limited; and such transfer shall represent repayment of 50% of the
      $5,725,000 loan. The remaining $2,862,500 principal amount of the Noble loan,
      together with accrued interest thereon at the rate of 4.5% per annum, will
      be
      repaid by Ho Capital Management LLC and Angela Ho solely out of the proceeds
      of
      any one or more sales of the insider warrants or underlying shares. Accordingly,
      except for the remaining 2,862,500 pledged insider warrants and proceeds from
      periodic sales of such warrants or underlying shares, the loan from Noble
      Investment Fund Limited to our Sponsor is non-recourse to both our Sponsor
      and
      Angela Ho, and none of the other assets of our Sponsor or Ms. Ho (including
      their legal and beneficial interest in our ordinary shares) are subject to
      attachment or any liability for repayment of the loan. The $5,725,000 loan
      from
      Noble Investment Fund Limited to Ho Capital Management LLC was made based upon
      a
      pre-existing business arrangement between Noble and Angela Ho whereby Ms. Ho
      agreed to organize the Sponsor and management of our company, Noble agreed
      to
      provide the financing for the purchase of the insider warrants, and the parties
      agreed to share equally in such insider warrants. The holders of the insider
      warrants will not have any right to any liquidation distributions with respect
      to the ordinary shares underlying the insider warrants in the event we fail
      to
      consummate a business combination and the insider warrants will expire
      worthless.





Noble
      Investment Fund Limited owns 33.3% of the members interest equity in our
      Sponsor. Under the terms of the operating agreement of Ho Capital Management
      LLC, Noble Investment Fund Limited has a beneficial interest in 437,500 shares
      or 33.3% of the 1,312,500 shares owned by Ho Capital Management LLC, and upon
      consummation of a business combination, has the right to withdraw as a member
      of
      Ho Capital Management LLC and receive a distribution of 437,500 ordinary shares
      (33.3% of the 1,312,500 ordinary shares owned by Ho Capital Management LLC)
      as
      well as 50% of the 5,725,000 insider warrants owned by Ho Capital Management
      LLC. In the event Noble Investment Fund Limited withdraws as a member of Ho
      Capital Management LLC after the completion of our business combination, the
      437,500 ordinary shares transferable to Noble Investment Fund Limited by Ho
      Capital Management will be placed in the three year escrow account together
      with
      the remaining 875,000 ordinary shares owned of record and beneficially by Ho
      Capital Management LLC; provided that, each of Angela Ho and Noble Investment
      Fund Limited, the members of Ho Capital Management LLC, have agreed that prior
      to the consummation of a business combination, they will not withdraw as members
      of such entity. Including its interest in 250,000 ordinary shares, or 50% of
      the
      ordinary shares owned by Allius Ltd., Noble Investment Fund Limited has the
      right to receive an aggregate of 687,500 of our ordinary shares (250,000 shares
      transferable from Allius and 437,500 shares transferable from Ho Capital
      Management), as well as 2,862,500 insider warrants (transferable from Ho Capital
      Management).





Noble
      Investment Fund Limited has also loaned to our Sponsor $500,000 to enable our
      Sponsor to pay expenses related to our offering. Such loan does not bear
      interest and is payable by the Sponsor on January 31, 2008 or earlier upon
      completion of our offering from the proceeds of our offering not being placed
      in
      the trust account and not from the $2,000,000 to be released to us from interest
      earned in the trust account to fund our working capital. Pursuant to a line
      of
      credit promissory note the Sponsor has advanced to us a total of $500,000 to
      cover certain of the expenses related to our offering. Such loan will be payable
      without interest on the consummation of the offering. We intend to repay the
      outstanding amount on this line of credit from the proceeds of our offering
      not
      being placed in the trust account and not from the $2,000,000 to be released
      to
      us from interest earned in the trust account to fund our working capital. This
      line of credit promissory note is non-interest bearing and matures on the
      earlier to occur of (a) the date of closing of the offering being made by our
      prospectus, or (b) January 31, 2008. The loan was repaid on January 23, 2008.





As
      consideration for providing the Sponsor with a $500,000 working capital loan
      and
      with the $5,725,000 to enable our Sponsor to purchase the 5,725,000 insider
      warrants, our Sponsor issued to Noble Investment Fund Limited a 33.3% beneficial
      interest in the 1,312,500 ordinary shares owned by our Sponsor (437,250 ordinary
      shares), agreed that Noble Investment Fund Limited could purchase (through
      its
      50% members interest in Allius Ltd.) an additional 250,000 ordinary shares
      for
      $25,000, and agreed to distribute legal and beneficial ownership in 50% of
      the
      insider warrants to Noble Investment Fund Limited upon completion of a business
      combination.





Of
      the
      $2,000,000 of estimated interest earned on our trust account which we may use
      to
      defray our operating expenses and working capital requirements pending
      completion of a business combination. We will also reimburse our officers and
      directors for any reasonable out-of-pocket business expenses incurred by them
      in
      connection with certain activities on our behalf such as identifying and
      investigating possible target businesses and business combinations. There is
      no
      limit on the amount of accountable out-of-pocket expenses reimbursable by us,
      which will be reviewed only by our board or a court of competent jurisdiction
      if
      such reimbursement is challenged. Other than such payments, no compensation
      or
      fees of any kind, including finders and consulting fees, will be paid to any
      of
      our initial shareholders, officers or directors, or to any of their respective
      affiliates for services rendered to us prior to or with respect to the business
      combination.




76





Our
      initial shareholders will not receive either compensation or reimbursement
      for
      any out-of- pocket expenses incurred by them to the extent that such expenses
      exceed the amount not held in the trust account unless the business combination
      is consummated and there are sufficient funds available for reimbursement after
      such consummation. The financial interest of such persons could influence their
      motivation in selecting a target business and thus, there may be a conflict
      of
      interest when determining whether a particular business combination is in the
      shareholders’ best interest.





After
      the
      consummation of a business combination, if any, to the extent our management
      remains as officers of the resulting business, we anticipate that our officers
      and directors may enter into employment or consulting agreements, the terms
      of
      which shall be negotiated and which we expect to be comparable to employment
      or
      consulting agreements with other similarly-situated companies in the industry
      in
      which we consummate a business combination. Further, after the consummation
      of a
      business combination, if any, to the extent our directors remain as directors
      of
      the resulting business, we anticipate that they will receive compensation
      comparable to directors at other similarly-situated companies in the industry
      in
      which we consummate a business combination.





All
      ongoing and future transactions between us and any of our officers and directors
      or their respective affiliates, including loans by our officers and directors,
      will be on terms believed by us to be no less favorable than are available
      from
      unaffiliated third parties and such transactions or loans, including any
      forgiveness of loans, will require prior approval in each instance by a majority
      of our uninterested “independent” directors (to the extent we have any) or the
      members of our board who do not have an interest in the transaction, in either
      case who had access, at our expense, to our attorneys or independent legal
      counsel.





Each
      of
      Ho Capital Management LLC and Allius Ltd. were entities formed for the specific
      purpose of acquiring shares in our company. In order to protect the amounts
      held
      in the trust account, our Sponsor, Noble Investment Fund Limited and Allius
      Ltd.
      have each agreed to indemnify us, jointly and severally, for claims of creditors
      (including any of our officers or directors) that have not executed a valid
      and
      enforceable waiver of their right to seek payment of amounts due to them out
      of
      the trust account. Except for claims for reimbursement of expenses payable
      to
      any of our officers or directors (which claims against the trust account must
      be
      waived in writing), we may elect to forego obtaining waivers only if we receive
      the approval of our Chief Executive Officer and the approving vote or written
      consent of at least a majority of our board of directors, including all of
      our
      independent directors. Each of Angela Ho and Noble Investment Fund Limited,
      the
      members of Ho Capital Management LLC (our Sponsor) and Dr. Gary T. Hirst and
      Noble Investment Fund Limited (the members of Allius Ltd.), have agreed that,
      prior to the consummation of a business combination, they will not withdraw
      as
      members of Ho Capital Management LLC or Allius Ltd. However, a withdrawal by
      any
      member of our Sponsor, Allius Ltd. or Noble Investment Fund Limited will not
      affect the indemnification obligations of our Sponsor, Allius Ltd., or Noble
      Investment Fund Limited to our company. We have not independently verified
      whether our Sponsor, Noble Investment Fund Limited or Allius Ltd. have
      sufficient funds to satisfy their respective indemnity obligations and,
      therefore, we cannot assure you that they would be able to satisfy these
      obligations.





**Conflicts
      of Interest**





Potential
      investors should be aware of the following potential conflicts of
      interest:




None
      of
      our officers or directors is required to commit their full time to our affairs
      and, accordingly, they may have conflicts of interest in allocating management
      time among various business activities.





None
      of
      our officers, directors or initial shareholders are currently affiliated with
      any entity whose primary business focus includes acquisitions in Asia. Each
      of
      our officers, directors and initial shareholders have agreed that, until we
      consummate a business combination or liquidate our trust account, they will
      not
      become associated or affiliated with any such competing entity. In addition,
      such persons have agreed that they will present to our board of directors any
      acquisition opportunity in Asia they obtain access to and which could reasonably
      be expected to be valued at 80% or more of the total amount placed in our trust
      account upon completion of our offering (excluding deferred underwriting fees),
      and provide us a right of first refusal to consummate such an acquisition.
      Each
      member of our management and board of directors has confirmed to us that they
      do
      not, and will not, have any pre-existing relationships or contractual
      obligations which would have priority over us with respect to the presentation
      of a business opportunity that meets our investment criteria of a fair market
      value of 80% or more of the total amount placed in our trust account upon
      completion of our offering (excluding deferred underwriting fees) and which
      is
      located in or primarily doing business in or investing in Asia.





77





Our
      board
      of directors may have a conflict of interest in determining whether a particular
      target business is appropriate to effect a business combination. Their personal
      and financial interests may influence their motivation in identifying and
      selecting a target business and completing a business combination for the
      following reasons:


·
            our
                Sponsor and all of our officers and directors or their affiliates
                own
                ordinary shares which will be released from escrow after three years
                from
                the date of our prospectus and only if we consummate a business
                combination and with respect to which they are waiving their redemption
                and liquidation distribution rights if we liquidate;
                and


·
            immediately
                prior to the date of our prospectus, our Sponsor, which is co-managed
                by
                Angela Ho, our chief executive officer and chairman of our board
                of
                directors, purchased 5,725,000 insider warrants at a purchase price
                of
                $1.00 per warrant, which insider warrants are identical to the warrants
                in
                the units being offered by our prospectus except that: (a) subject
                to
                limited exceptions, none of the insider warrants will be transferable
                or
                salable until after we complete a business combination; (b) the insider
                warrants are not subject to redemption if held by the initial holders
                or
                their permitted assigns; and (c) so long as the insider warrants
                are owned
                by Ho Capital Management LLC or its permitted assigns, they may be
                exercised on a cashless basis. Until we consummate a business combination,
                none of the insider warrants nor the members interests of Ho Capital
                Management LLC may be sold, transferred or assigned. Upon consummation
                of
                a business combination, 50% of the insider warrants will be transferred
                to
                Noble Investment Fund Limited, in reduction of 50% of a $5,725,000
                five
                year non-recourse loan to be provided by Noble Investment Fund Limited
                to
                enable Ho Capital Management LLC to purchase the insider warrants.
                The 50%
                balance of the insider warrants and any shares issuable upon exercise
                of
                such insider warrants will remain pledged to Noble as collateral
                for
                repayment of the $2,862,500 balance of the Noble loan. At such time
                as the
                Noble loan is retired (solely from the proceeds of the sale of insider
                warrants or underlying shares), the balance of such insider warrants
                or
                underlying shares shall be transferable to Angela Ho, a co-manager
                of Ho
                Capital Management LLC, or her
                designees.





Although
      we have attempted to minimize potential conflicts of interest by establishing
      policies whereby:





·
            our
                company will not acquire control or effect a business combination
                with any
                entity in which any of our officers, directors or initial shareholders
                are
                officers, directors, employees, or owners of more than 5% of the
                equity of
                such entity, or otherwise directly or indirectly an affiliate of
                such
                entity;


·
            none
                of our officers, directors or any of their affiliates will receive
                any
                finders fees or other compensation, either from us or from a prospective
                target company, in connection with any business
                combination;


·
            we
                are requiring each of our officers and directors to provide us with
                a
                right of first refusal to acquire any corporate or business opportunities
                that are located in or primarily doing business in or investing in
                Asia
                they obtain access to, whether individually or through a company
                they are
                or may become affiliated with, and which could reasonably be valued
                at 80%
                or more of the total amount placed in our trust account upon completion
                of
                our offering (excluding deferred underwriting fees). In addition,
                each of
                the entities currently affiliated with our officers and directors
                have
                confirmed to us that such agreement will not violate any prior fiduciary
                duty or agreement with such entity. Such entities executed a written
                confirmation and delivered to us in which they acknowledged that
                they have
                received a copy of, and have reviewed, the applicable right of first
                refusal agreement and that compliance with such agreement by the
                applicable officer, director or initial shareholders will not violate
                any
                prior fiduciary duty or agreement with such entity;
                and


·
            prior
                to the consummation of a business combination, the liquidation of
                our
                company, or their ceasing to be a shareholder, officer or director
                of our
                company, each of our officers, directors or initial shareholders
                have
                agreed not to become affiliated with any entity, including other
                blank
                check companies, with a primary focus on completing an acquisition
                in
                Asia.





Subject
      to the above policies, our officers and directors may in the future become
      affiliated with entities, including other blank check or business combination
      companies, engaged in business activities similar to those intended to be
      conducted by our company. Since our directors beneficially own ordinary shares
      which will be released from escrow only if a business combination is
      successfully completed, our board may have a conflict of interest in determining
      whether a particular target business is appropriate to effect a business
      combination. The personal and financial interests of our directors and officers
      may influence their motivation in identifying and selecting a target business,
      completing a business combination timely and securing the release of their
      stock.





If
      we
      were to make a deposit, down payment or fund a “no shop” provision in connection
      with a potential business combination, we may have insufficient funds outside
      of
      the trust to pay for due diligence, legal, accounting and other expenses
      attendant to completing a business combination. In such event, our initial
      shareholders may have to incur such expenses in order to proceed with the
      proposed business combination. As part of any such combination, such initial
      shareholders may negotiate the repayment of some or all of any such expenses,
      without interest or other compensation, which if not agreed to by the target
      business’ management, could cause our management to view such potential business
      combination unfavorably, thereby resulting in a conflict of interest.





After
      the
      consummation of a business combination, if any, to the extent our management
      remains as officers of the resulting business, some of our officers and
      directors may enter into employment agreements, the terms of which shall be
      negotiated and which we expect to be comparable to employment agreements with
      other similarly-situated companies in Asia. Further, after the consummation
      of a
      business combination, if any, to the extent our directors remain as directors
      of
      the resulting business, we anticipate that they will receive compensation
      comparable to directors at other similarly-situated companies in Asia.




78





All
      ongoing and future transactions between us and any of our officers and directors
      or their respective affiliates, including the provision of the loans by our
      officers and directors, will be on terms believed by us at that time, based
      upon
      other similar arrangements known to us, to be no less favorable than are
      available from unaffiliated third parties and any transactions or loans,
      including any forgiveness of loans, will require prior approval in each instance
      by a majority of our uninterested “independent” directors (to the extent we have
      any) or the members of our board who do not have an interest in the transaction,
      in either case who had access, at our expense, to our attorneys or independent
      legal counsel. We will not enter into any such transaction unless our
      disinterested “independent” directors (or, if there are no “independent”
directors, our disinterested directors) determine that the terms of such
      transaction are no less favorable to us than those that would be available
      to us
      with respect to such a transaction from unaffiliated third parties.





To
      further minimize potential conflicts of interest, we will not enter into any
      business combination with any affiliates of our Sponsor, initial shareholders,
      advisors, officers or directors, or any affiliates thereof.




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





**Appointment
      of Auditors**





Our
      board
      of directors selected Tedder, James, Worden & Associates, P.A. as our
      auditors for the period March 22, 2007 (inception) to September 24, 2007, the
      date of their resignation. In addition, our board of directors selected
      Rothstein, Kass & Company, P.C. as our auditors for the period September 24,
      2007 to December 31, 2007.





**Audit
      Fees**





Tedder,
      James, Worden & Associates, P.A. billed us $14,645 in fees for audit
      services for the period March 22, 2007 (inception) to September 24, 2007.
      Rothstein, Kass & Company, P.C. billed us $20,000 in fees for audit services
      for the period September 24, 2007 to December 31, 2007.





**Audit-Related
      Fees**





We
      did
      not pay any fees to Tedder, James, Worden & Associates, P.A. for assurance
      and related services that are not reported under Audit Fees above, for the
      period March 22, 2007 (inception) to September 24, 2007. We did not pay any
      fees
      to Rothstein, Kass & Company, P.C. for assurance and related services that
      are not reported under Audit Fees above, for the period September 24, 2007
      to
      December 31, 2007.





**Tax
      and All Other Fees**





We
      did
      not pay any fees to Tedder, James, Worden & Associates, P.A. for tax
      compliance, tax advice, tax planning or other work for the period March 22,
      2007
      (inception) to September 24, 2007. We did not pay any fees to Rothstein, Kass
      & Company, P.C. for tax compliance, tax advice, tax planning or other work
      for the period September 24, 2007 to December 31, 2007.





**Pre-Approval
      Policies and Procedures**





We
      have
      implemented pre-approval policies and procedures related to the provision of
      audit and non-audit services. Under these procedures, our audit committee
      pre-approves all services to be provided by Rothstein, Kass & Company, P.C.
      and the estimated fees related to these services.





With
      respect to the audit of our financial statements as of December 31, 2007, and
      for the year then ended, none of the hours expended by Rothstein, Kass &
Company, P.C.’s engagement to audit those financial statements were attributed
      to work by persons other than Rothstein, Kass & Company, P.C., and its
      full-time, permanent employees.




79


**ITEM
      15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.**





**(a)
      Financial Statements and Schedules**





1. ***Financial
      Statements***





The
      following financial statements are filed as part of this report under Item
      8 of
      Part II “Financial Statements and Supplementary Data:





A.
      Balance Sheet as of December 31, 2007.




B.
      Statements of Operations for the period March 22, 2007 (inception) through
      December 31, 2007.




C.
      Statements of Shareholders’ Equity for the period March 22, 2007 (inception)
      through December 31, 2007.




D.
      Statements of Cash Flows for the period March 22, 2007 (inception) through
      December 31, 2007.





2 *.* ***Financial
      Statement Schedules***





Financial
      statement schedules not included herein have been omitted because they are
      either not required, not applicable, or the information is otherwise included
      herein.





**(b)
      Exhibits**





The
      exhibits listed below are filed or incorporated by reference as part of this
      Annual Report on Form 10-K.





**Exhibit
                No.**
            
            **Description**





1.1
            
            Underwriting
                Agreement (incorporated herein by reference to Exhibit 10.1 to the
                Registrant’s Current Report on Form 8-K (File No. 001-33916), as filed
                with the Securities and Exchange Commission on January 25,
                2008).3.1
            
            Amended
                and Restated Memorandum and Articles of Association (incorporated
                herein
                by reference to Exhibit 3.1 to Amendment No. 2 to the Registrant’s
                Registration Statement****on
                Form S-1 (File No. 333-145163), as filed with the Securities and
                Exchange
                Commission on November 2, 2007).4.1
            
            Specimen
                Unit Certificate (incorporated herein by reference to Exhibit 4.1
                to
                Amendment No. 1 to the Registrant’s Registration Statement on Form S-1
                (File No. 333-145163), as filed with the Securities and Exchange
                Commission on October 1, 2007).4.2
            
            Specimen
                Ordinary Share Certificate (incorporated herein by reference to Exhibit
                4.2 to Amendment No. 1 to the Registrant’s Registration Statement on Form
                S-1 (File No. 333-145163), as filed with the Securities and Exchange
                Commission on October 1, 2007).4.3
            
            Specimen
                Warrant Certificate (incorporated herein by reference to Exhibit
                4.3 to
                Amendment No. 1 to the Registrant’s Registration Statement on Form
                S-1 (File No. 333-145163), as filed with the Securities and Exchange
                Commission on October 1, 2007).





4.4
            
            Warrant
                Agreement between Continental Stock Transfer & Trust Company and the
                Registrant. (incorporated herein by reference to Exhibit 4.1 to the
                Registrant’s Current Report on Form 8-K (File No. 001-33916), as filed
                with the Securities and Exchange Commission on January 25,
                2008).4.5
            
            Unit
                Purchase Option in favor of Maxim Partners LLC (incorporated herein
                by
                reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K
                (File No. 001-33916), as filed with the Securities and Exchange Commission
                on January 25, 2008).4.6
            
            Unit
                Purchase Option in favor of CRT Capital Group LLC (incorporated herein
                by
                reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K
                (File No. 001-33916), as filed with the Securities and Exchange Commission
                on January 25, 2008).10.1
            
            Form
                of Letter Agreement by Insiders of the Registrant to Maxim Group
                LLC and
                the Registrant (incorporated herein by reference to Exhibit 10.1
                to
                Amendment No. 4 to the Registrant’s Registration Statement on Form
                S-1 (File No. 333-145163), as filed with the Securities and Exchange
                Commission on December 17, 2007).





10.2
            
            Investment
                Management Trust Agreement between Continental Stock Transfer & Trust
                Company and the Registrant (incorporated herein by reference to Exhibit
                10.2 to the Registrant’s Current Report on Form 8-K (File No. 001-33916),
                as filed with the Securities and Exchange Commission on January 25,
                2008).10.3
            
            Stock
                Escrow Agreement between the Registrant, Continental Stock Transfer
&
                Trust Company and the Initial Shareholders (incorporated herein by
                reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K
                (File No. 001-33916), as filed with the Securities and Exchange Commission
                on January 25, 2008).





10.4
            
            Registration
                Rights Agreement among the Registrant and the Initial Shareholders
                (incorporated herein by reference to Exhibit 10.4 to the Registrant’s
                Current Report on Form 8-K (File No. 001-33916), as filed with the
                Securities and Exchange Commission on January 25,
                2008).10.5
            
            Subscription
                Agreement between the Registrant and certain officers and directors
                of the
                Registrant (incorporated herein by reference to Exhibit 10.5 to the
                Registrant’s Current Report on Form 8-K (File No. 001-33916), as filed
                with the Securities and Exchange Commission on January 25,
                2008).




80




10.6
            
            Promissory
                Note in the amount of up to $500,000 issued to Ho Capital Management
                LLC
                (incorporated herein by reference to Exhibit 10.8 to the Registrant’s
                Registration Statement on Form S-1 (File No. 333-145163), as filed
                with
                the Securities and Exchange Commission on August 6,
                2007).10.7
            
            Promissory
                Note in the amount of up to $500,000 issued by Ho Capital Management
                LLC
                to Noble Investment Fund Limited (incorporated herein by reference
                to
                Exhibit 10.9 to the Registrant’s Registration Statement on Form S-1 (File
                No. 333-145163), as filed with the Securities and Exchange Commission
                on
                August 6, 2007).10.8
            
            Letter
                Agreement among Noble Investment Fund Limited, Ho Capital Management
                LLC
                and Allius Ltd. (incorporated herein by reference to Exhibit 10.10
                to the
                Registrant’s Registration Statement on Form S-1 (File No. 333-145163), as
                filed with the Securities and Exchange Commission on August 6,
                2007).10.9
            
            Form
                of Promissory Note in the amount of $5,725,000 issued by Ho Capital
                Management LLC to Noble Investment Fund Limited (incorporated herein
                by
                reference to Exhibit 10.9 to Amendment No. 3 to the Registrant’s
                Registration Statement on Form S-1 (File No. 333-145163), as filed
                with
                the Securities and Exchange Commission on November 26,
                2007).10.10
            
            Form
                of Pledge Agreement between Ho Capital Management LLC, Noble Investment
                Fund Limited and Hodgson Russ LLP (incorporated herein by reference
                to
                Exhibit 10.10 to Amendment No. 4 to the Registrant’s Registration
                Statement on Form S-1 (File No. 333-145163), as filed with the
                Securities and Exchange Commission on December 17,
                2007).10.11
            
            Form
                of Operating Agreement of Ho Capital Management LLC (incorporated
                herein
                by reference to Exhibit 10.11 to Amendment No. 4 to the Registrant’s
                Registration Statement on Form S-1 (File No. 333-145163), as filed
                with the Securities and Exchange Commission on December 17,
                2007).10.12
            
            Form
                of Letter Agreement by affiliated entities of the Registrant’s officers,
                directors and initial shareholders to Maxim Group LLC and the Registrant
                (incorporated herein by reference to Exhibit 10.12 to Amendment No.
                2 to
                the Registrant’s Registration Statement****on
                Form S-1 (File No. 333-145163), as filed with the Securities and
                Exchange
                Commission on November 2, 2007).





10.13
            
            Loan
                and Security Agreement dated as of February 28, 2008 by and between
                Asia
                Special Situation Acquisition Corp. and Wachovia Bank, National
                Association (incorporated herein by reference to Exhibit 10.1 to
                the
                Registrant’s Current Report on Form 8-K (File No. 001-33916), as filed
                with the Securities and Exchange Commission on March 3,
                2008).10.14
            
            $500,000
                Promissory Note of Asia Special Situation Acquisition Corp. dated
                as of
                February 28, 2008 in favor of Wachovia Bank, National Association
                (incorporated herein by reference to Exhibit 10.2 to the Registrant’s
                Current Report on Form 8-K (File No. 001-33916), as filed with the
                Securities and Exchange Commission on March 3, 2008).16.1
            
            Letter
                from Tedder, James, Worden & Associates, P.A. (incorporated herein by
                reference to Exhibit 16.1 to Amendment No. 1 to the Registrant’s
                Registration Statement on Form S-1 (File No. 333-145163), as filed
                with the Securities and Exchange Commission on October 1,
                2007).31.1
            
            Certification
                by Chief Executive Officer pursuant to Sarbanes Oxley Section
                302.*31.2
            
            Certification
                by Chief Financial Officer pursuant to Sarbanes Oxley Section
                302.*32.1
            
            Certification
                by Chief Executive Officer pursuant to 18 U.S.C. Section
                1350.*32.2
            
            Certification
                by Chief Financial Officer pursuant to 18 U.S.C. Section
                1350.*99.1
            
            Code
                of Ethics (incorporated herein by reference to Exhibit 99.1 to the
                Registrant’s Registration Statement on Form S-1 (File No. 333-145163), as
                filed with the Securities and Exchange Commission on August 6,
                2007).







*
      Filed
      herewith.




81








**SIGNATURES**





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act,
      the
      registrant has duly caused this report to be signed on its behalf by the
      undersigned, thereunto duly authorized, on this 27 th day of
      March, 2008.




**ASIA
                SPECIAL SITUATION ACQUISITION CORP.**By:
            */s/
                Angela Ho*Angela
                HoChief
                Executive Officer
              (Principal
                  Executive Officer)




By:
            */s/
                Michael Hlavsa*Michael
                HlavsaChief
                Financial Officer
              (Principal
                  Accounting Officer)




Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act,
      this
      report has been signed below by the following persons on behalf of the
      registrant and in the capacities and on the dates indicated.





**Name**
            
            **Position**
            
            **Date***/s/
                Angela Ho*
              Angela
                Ho
            
            Chief
                Executive Officer and Chairman
                of
                  the Board of Directors
            
            March
                27, 2008*/s/
                Gary T. Hirst*
              Dr.
                  Gary T. Hirst
            
            President
                and Director
            
            March
                27, 2008*/s/
                Michael Hlavsa*
              Michael
                  Hlavsa
            
            Chief
                Financial Officer and Director
            
            March
                27, 2008*/s/
                Peter Kjaer*
              Peter
                  Kjaer
            
            Director
                and Chief Operating Officer
            
            March
                27, 2008*/s/
                Stuart A. Sundlun*
              Stuart
                  A. Sundlun
            
            Director
            
            March
                27, 2008*/s/
                Arie Jan van Roon*
              Arie
                  Jan van Roon
            
            Director
            
            March
                27, 2008




82