**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**


**FORM
      10-K**





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




**For
      the fiscal year ended December 31, 2007**




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




**For
      the transition period from ______________to ______________**




**Commission
      File Number 001-33814**




**TREMISIS
      ENERGY ACQUISITION CORPORATION II**


(Name
      of
      Issuer in Its Charter)





**Delaware**
              (State
                of Incorporation)
            **26-0971890**
              (Issuer
                I.R.S. Employer I.D. Number)





**11622
                Monica Street, Houston, Texas**
              (Address
                of principal executive offices)
            **77024**
              (zip
                code)





**(713)
      954-3665**


(Issuer’s
      Telephone Number, Including Area Code)





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




Title
                of Each Class
            Name
                of Each Exchange on Which RegisteredUnits
                consisting of one share of Common Stock, par value $.0001 per share,
                and
                one Warrant
            American
                Stock ExchangeCommon
                Stock, $.0001 par value per share
            American
                Stock ExchangeWarrants
                to purchase shares of Common Stock
            American
                Stock Exchange





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


None





Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act.


Yes
o    
      No x





Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or 15(d) of the Exchange Act. Yes o Nox





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





Indicate
      by check mark if there is no disclosure of delinquent filers in response to
      Item
      405 of Regulation S-K contained in this form, and no disclosure will be
      contained, to the best of the registrant’s knowledge, in definitive proxy or
      information statements incorporated by reference in Part III of this Form 10-K
      or any amendment to this Form 10-K. x





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




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


(Do
      not
      check if a smaller reporting company)





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).


Yes x No
o





Issuer’s
      revenues for the fiscal period ended December 31, 2007 were $0.





As
      of
      March 25, 2008, the aggregate market value of the common stock held by
      non-affiliates of the registrant was approximately $70,075,217.





As
      of
      March 24, 2008, there were 12,165,837 shares of Common Stock, $.0001 par value
      per share, outstanding.





Documents
      Incorporated by Reference: None.








TREMISIS
        ENERGY ACQUISITION CORPORATION II
 FORM
        10-K
 TABLE
        OF
        CONTENTS


PART
                IItem
                  1.
              BUSINESS
              2Item
                  1A.
              RISK
                  FACTORS
              8Item
                  1B.
              UNRESOLVED
                  STAFF COMMENTS
              23Item
                  2.
              PROPERTIES
              23Item
                  3.
              LEGAL
                  PROCEEDINGS
              23Item
                  4.
              SUBMISSION
                  OF MATTERS TO A VOTE OF SECURITYHOLDERS
              23PART
                IIItem
                  5.
              MARKET
                  FOR REGISTRANT’S COMMON EQUITY,RELATED
                  STOCKHOLDER MATTERS AND ISSUER PURCHASESOF
                  EQUITY SECURITIES
              23Item
                  6.
              SELECTED
                  FINANCIAL DATA
              25Item
                  7.
              MANAGEMENT’S
                  DISCUSSION AND ANALYSIS OF FINANCIALCONDITION
                  AND RESULTS OF OPERATIONS
              26Item
                  7A.
              QUANTITATIVE
                  AND QUALITATIVE DISCLOSURESABOUT
                  MARKET RISK
              28Item
                  8.
              FINANCIAL
                  STATEMENTS AND SUPPLEMENTARY DATA
              28Item
                  9.
              CHANGES
                  IN AND DISAGREEMENTS WITH ACCOUNTANTSON
                  ACCOUNTING AND FINANCIAL DISCLOSURE
              28Item
                  9A
              CONTROLS
                  AND PROCEDURES
              28Item
                  9B.
              OTHER
                  INFORMATION
              28PART
                IIIItem
                  10.
              DIRECTORS,
                  EXECUTIVE OFFICERS ANDCORPORATE
                  GOVERNANCE
              28Item
                  11.
              EXECUTIVE
                  COMPENSATION
              32Item
                  12.
              SECURITY
                  OWNERSHIP OF CERTAIN BENEFICIAL OWNERSAND
                  MANAGEMENT AND RELATED STOCKHOLDER MATTERS
              34Item
                  13.
              CERTAIN
                  RELATIONSHIPS AND RELATED TRANSACTIONS, ANDDIRECTOR
                  INDEPENDENCE
              36Item
                  14.
              PRINCIPAL
                  ACCOUNTANT FEES AND SERVICES
              39Item
                  15.
              EXHIBITS
                  AND FINANCIAL STATEMENT SCHEDULES
              40INDEX
                TO FINANCIAL STATEMENTS
              42









**PART
      I**




**ITEM
      1. BUSINESS**




Tremisis
      Energy Acquisition Corporation II isa blank
      check company formed on July 3, 2007 to acquire one or more operating businesses
      or assets through a merger, stock exchange, asset acquisition, reorganization
      or
      similar business combination.Our
      efforts in identifying a prospective target business will not be limited to
      a
      particular industry, although we intend to focus our efforts on seeking a
      business combination with an operating company in either the energy or the
      environmental industry and their related infrastructures.




On
      December 12, 2007, we closed our initial public offering of 9,500,000 units
      with
      each unit consisting of one share of our common stock and one warrant, each
      to
      purchase one share of our common stock at an exercise price of $5.00 per share
      (“IPO”). Simultaneously with the consummation of the IPO, we consummated the
      private sale of 2,650,000 warrants (“sponsors’ warrants”) at a price of $1.00
      per sponsors’ warrant, generating total proceeds of $2,650,000. On January 24,
      2008, we consummated the closing of an additional 232,669 units which were
      subject to the over-allotment option. The units from the initial public offering
      (including the over-allotment option) were sold at an offering price of $8.00
      per unit, generating total gross proceeds of $77,861,352. After deducting the
      underwriting discounts and commissions and the offering expenses, the total
      net
      proceeds to us from the offering (including the over-allotment option and the
      private sale) were $77,572,806, of which $77,400,511 was deposited into the
      trust account and the remaining proceeds became available to be used to provide
      for business, legal and accounting due diligence on prospective business
      combinations and continuing general and administrative expenses. The net
      proceeds deposited into the trust fund remain on deposit in the trust fund
      earning interest. As of December 31, 2007, there was $75,595,000 plus accrued
      interest of $152,990 held in the trust fund.




We
      are
      not presently engaged in, and we will not engage in, any substantive commercial
      business for an indefinite period of time. We intend to utilize cash derived
      from the proceeds of our IPO, our capital stock, debt or a combination of these
      in effecting a business combination. Although substantially all of the net
      proceeds of our IPO are intended to be applied generally toward effecting a
      business combination, the proceeds are not otherwise being designated for any
      more specific purposes. A business combination may involve the acquisition
      of,
      or merger with, a company which does not need substantial additional capital
      but
      which desires to establish a public trading market for its shares, while
      avoiding what it may deem to be adverse consequences of undertaking a public
      offering itself. These 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. While we may seek to effect simultaneous business combinations with
      more
      than one target business, we will probably have the ability, as a result of
      our
      limited resources, to effect only a single business combination.




**Energy
      Industry and Its Related Infrastructure**




The
      energy industry and its related infrastructure generally includes the
      production, generation, transmission and distribution of electricity, heat,
      fuel
      and other consumable forms of energy and the infrastructure needed to maintain
      and operate the facilities, services and installations used in the foregoing
      areas. The shortage of natural gas, rising oil prices and blackouts that have
      occurred as a result of over-usage in current energy forms have brought renewed
      focus on a variety of energy forms and the infrastructure related to the
      transmission of such energy.




Although
      we may consider a target business in any segment of the energy industry, we
      currently intend to concentrate our search for an acquisition candidate on
      companies in the following segments:




·
            Electricity
                generation, distribution and
                transmission;




2




·
            Oil
                and natural gas production, distribution and
                transmission;




·
            Energy
                related services including conservation, metering, operations and
                maintenance;




·
            Steam
                generation and distribution;




·
            Alternative
                and renewable energy technologies;
                and




·
            The
                infrastructure necessary to operate in the energy industry including
                but
                not limited to areas such as the production, transportation or
                distribution of towers, power lines, scaffolding products and other
                equipment or supplies incidental to the energy
                industry.




**Environmental
      Industry and Its Related Infrastructure**




The
      environmental industry and its related infrastructure generally includes the
      technologies and services that protect the natural and human environment from
      destruction and pollution, and the infrastructure needed to maintain and operate
      the facilities, services and installations used in the foregoing areas. The
      environmental industry also seeks to ameliorate the negative effects of
      industrial production and unhealthy practices and materials on our population
      as
      a whole.




Landfill
      closures and the difficulty of positioning new facilities in certain parts
      of
      the country have required that waste be transported long distances for
      environmentally sound disposal. New landfills require additional remediation
      measures to ensure that waste does not contaminate the surrounding ground or
      nearby water supplies. New technologies and expenditures are increasingly
      required with respect to air emissions and water cleanup, as pollution from
      power and industrial plants merit increasing examination and concern. Searches
      for new energy and water sources must meet stringent environmental standards,
      while existing and alternative forms of energy that are being used, developed
      and tested must adhere to an expanding body of practices and procedures to
      ensure that our environment is protected.




Although
      we may consider a target business in any segment of the environmental industry,
      we currently intend to concentrate our search for an acquisition candidate
      on
      companies in the following segments:




·
            Waste
                management and disposal, including wastewater treatment and management
                and
                sewage control;




·
            Air
                treatment and ionization, pollution and emission
                control;




·
            Medical
                waste disposal;




·
            Radon
                and site cleanup services;




·
            Other
                energy/environmental related technologies;
                and




·
            The
                infrastructure necessary to operate in the environmental industry
                including but not limited to areas such as the operation of water
                supply
                facilities, waste and wastewater treatment facilities, pollution
                control
                facilities and transportation facilities and the production,
                transportation or distribution of the equipment and products incidental
                to
                such operations.




3




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




We
      believe based on our management’s business knowledge and past experience that
      there are numerous acquisition candidates available. We anticipate that target
      business candidates will be brought to our attention from various unaffiliated
      sources, including investment bankers, venture capital funds, private equity
      funds, leveraged buyout funds, management buyout funds and other members of
      the
      financial community. Target businesses may be brought to our attention by such
      unaffiliated sources as a result of being solicited by us through calls or
      mailings. These sources may also introduce us to target businesses they think
      we
      may be interested in on an unsolicited basis, since many of these sources will
      have read our prospectus for our IPO and know what types of businesses we are
      targeting. Our officers and directors, as well as their affiliates, may also
      bring to our attention target business candidates that they become aware of
      through their business contacts as a result of formal or informal inquiries
      or
      discussions they may have, as well as attending trade shows or conventions.
      While we do not presently anticipate engaging the services of professional
      firms
      or other individuals that specialize in business acquisitions on any formal
      basis, we may engage these firms or other individuals in the future, in which
      event we may pay a finder’s fee, consulting fee or other compensation to be
      determined in an arm’s length negotiation based on the terms of the transaction.
      Payment of such fees is customarily tied to completion of a transaction, in
      which case any such fee will be paid out of the funds held in the trust account.
      Although it is possible that we may pay such fees in the case of an uncompleted
      transaction, we consider this possibility to be remote. Our management has
      experience in evaluating transactions, particularly in the energy industry.
      However, they may retain consultants and advisors with experience in the
      evaluation of such business combinations and in our determination of whether
      or
      not to proceed with such a business combination, although we are not required
      to
      do so and may determine that our management is able to make its own
      determinations based on its collective business experience. In no event,
      however, will we pay any of our initial officers, directors or stockholders
      (collectively, our “founders”) or any entity with which they are affiliated any
      finder’s fee or other compensation for services rendered to us prior to or in
      connection with the consummation of a business combination.




Subject
      to the requirement that our initial business combination must be with a target
      business with a fair market value that is at least 80% of our net assets at
      the
      time of such acquisition, our management will have virtually unrestricted
      flexibility in identifying and selecting a prospective target business. We
      have
      not established any other specific attributes or criteria (financial or
      otherwise) for prospective target businesses. In evaluating a prospective target
      business, our management may consider a variety of factors, including one or
      more of the following:




·
            financial
                condition and results of operation;




·
            growth
                potential;




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




·
            capital
                requirements;




·
            competitive
                position;




·
            barriers
                to entry;




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




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




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




4




·
            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 and inspection of facilities, as well as
      review of financial and other information which is made available to us. This
      due diligence review will be conducted either by our management or by
      unaffiliated third parties we may engage, although we have no current intention
      to engage any such third parties. We are also required to have all prospective
      target businesses execute agreements with us waiving any right, title, interest
      or claim of any kind in or to any monies held in the trust account. If any
      prospective target business refused to execute such agreement, we would cease
      negotiations with such target business.




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.




**Fair
      Market Value of Target Business**




The
      initial target business that we acquire must have a fair market value equal
      to
      at least 80% of our net assets at the time of such acquisition. We anticipate
      structuring a business combination to acquire 100% of the equity interests
      or
      assets of the target business. We may, however, structure a business combination
      to acquire less than 100% of such interests or assets of the target business
      but
      will not acquire less than a controlling interest. If we acquire only a
      controlling interest in a target business or businesses, the portion of such
      business that we acquire must have a fair market value equal to at least 80%
      of
      our net assets. In order to consummate such an acquisition, 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 financing arrangement and
      have
      no current intention of doing so. The fair market value of such business will
      be
      determined by our board of directors based upon one or more standards generally
      accepted by the financial community (such as actual and potential sales,
      earnings, cash flow and/or book value). If our board is not able to
      independently determine that the target business has a sufficient fair market
      value, we will obtain an opinion from an unaffiliated, independent investment
      banking firm with respect to the satisfaction of such criteria. 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.




**Opportunity
      for stockholder approval of business combination**




Prior
      to
      the completion of a business combination, we will submit the transaction to
      our
      stockholders for approval, even if the nature of the acquisition is such as
      would not ordinarily require stockholder approval under applicable state law.
      In
      connection with any such transaction, we will also submit to our stockholders
      for approval a proposal to amend our amended and restated certificate of
      incorporation to provide for our corporate life to continue perpetually
      following the consummation of such initial business combination. Any vote to
      extend our corporate life to continue perpetually following the consummation
      of
      an initial business combination will be taken only if the initial business
      combination is approved. We will only consummate an initial business combination
      if stockholders vote both in favor of such initial business combination and
      our
      amendment to extend our corporate life.




5




In
      connection with seeking stockholder approval of a business combination, we
      will
      furnish our stockholders with proxy solicitation materials prepared in
      accordance with the Securities Exchange Act of 1934, which, among other matters,
      will include a description of the operations of the target business and audited
      historical financial statements of the business.




In
      connection with the vote required for any business combination, all of our
      founders, including all of our officers and directors, have agreed to vote
      the
      shares each received prior to our IPO (“founders’ shares”) in accordance with
      the vote of the holders of a majority of the shares of common stock purchased
      in
      our IPO (“IPO shares,” and the holders of IPO shares, “public stockholders”).
      None of our founders or their affiliates purchased any units in our IPO or
      have
      purchased any units or shares of common stock from persons in the open market
      or
      in private transactions after our IPO. However, if a significant number of
      stockholders vote, or indicate an intention to vote, against a proposed business
      combination, our founders or their affiliates could make such purchases in
      the
      open market or in private transactions in order to influence the vote. We will
      proceed with the business combination only if a majority of the shares of common
      stock voted by the public stockholders are voted in favor of the business
      combination and public stockholders owning less than 30% of the IPO shares
      both
      exercise their conversion rights and vote against the business
      combination.




**Conversion
      rights**




At
      the
      time we seek stockholder approval of any business combination, we will offer
      the
      public stockholders (but
      not
      any of our founders to the extent they hold IPO shares) the
      right
      to have such shares converted to cash if the stockholder votes against the
      business combination and the business combination is approved and completed.
      The
      actual per-share conversion price will be equal to the amount in the trust
      fund,
      inclusive of any interest, as of two business days prior to the consummation
      of
      the business combination, divided by the total number of IPO shares. As of
      December 31, 2007, the per-share conversion price would have been approximately
      $7.97.




An
      eligible stockholder may request conversion at any time after the mailing to
      our
      stockholders of the proxy statement and prior to the vote taken with respect
      to
      a proposed initial business combination at a meeting held for that purpose,
      but
      the request will not be granted unless the stockholder votes against the initial
      business combination and the initial business combination is approved and
      completed. Additionally, we may require public stockholders, whether they are
      a
      record holder or hold their shares in “street name,” to either tender their
      certificates to our transfer agent at any time through the vote on the initial
      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. The proxy solicitation materials that
      we will furnish to stockholders in connection with the vote for any proposed
      initial business combination will indicate whether we are requiring stockholders
      to satisfy such certification and delivery requirements. Accordingly, a
      stockholder would have from the time we send out our proxy statement through
      the
      vote on the initial business combination to complete the tender or delivery
      of
      his shares to us if he wishes to seek to exercise his conversion rights. This
      time period varies depending on the specific facts of each transaction. However,
      as the delivery process can be accomplished by the stockholder, whether or
      not
      he is a record holder or his shares are held in “street name,” in a matter of
      hours by simply contacting the transfer agent or his broker and requesting
      delivery of his 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
      anticipate.




Any
      request for conversion, once made, may be withdrawn at any time up to the vote
      taken with respect to the proposed business combination. Furthermore, if a
      stockholder delivered his certificate for conversion and subsequently decided
      prior to the meeting not to elect conversion, he may simply request that the
      transfer agent return the certificate (physically or electronically). It is
      anticipated that the funds to be distributed to stockholders entitled to convert
      their shares who elect conversion will be distributed promptly after completion
      of a business combination. Public stockholders who convert their stock into
      their share of the trust account still have the right to exercise any warrants
      they still hold.




6




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 December 6, 2009. If the initial business combination
      is
      not approved or completed for any reason, then public stockholders voting
      against our initial business combination who exercised their conversion rights
      would not be entitled to convert their shares of common stock into a pro rata
      share of the aggregate amount then on deposit in the trust account. In such
      case, if we have required public stockholders to tender their certificates
      prior
      to the meeting, we will promptly return such certificates to the tendering
      public stockholder. Public stockholders 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.




We
      will
      not complete any business combination if public stockholders, owning 30% or
      more
      of the IPO shares, both exercise their conversion rights and vote against the
      business combination. Accordingly, it is our understanding and intention in
      every case to structure and consummate a business combination in which public
      stockholders owning approximately 29.99% of the IPO shares may exercise their
      conversion rights and the business combination will still go forward. We have
      set the conversion percentage at 30% 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 is otherwise approved by a large
      majority of our public stockholders.




**Liquidation
      if no business combination**




If
      we do
      not complete a business combination by December 6, 2009, we will be dissolved
      and will distribute to all holders of IPO shares, in proportion to the number
      of
      IPO shares held by them, an aggregate sum equal to the amount in the trust
      fund,
      inclusive of any interest, plus any remaining net assets. The founders have
      waived their rights to participate in any liquidation distribution with respect
      to their founder shares. There will be no distribution from the trust fund
      with
      respect to our warrants.




Upon
      notice from us, the trustee of the trust fund will commence liquidating the
      investments constituting the trust fund and will turn over the proceeds to
      our
      transfer agent for distribution to our stockholders. We anticipate that our
      instruction to the trustee would be given promptly after the expiration of
      the
      applicable time periods.




If
      we
      were to expend all of the net proceeds of our initial public offering, other
      than the proceeds deposited in the trust fund, the per-share liquidation price
      as of December 31, 2007 would have been approximately $7.97. However, the
      proceeds deposited in the trust fund could become subject to the claims of
      our
      creditors which could be prior to the claims of our public stockholders.
      Lawrence S. Coben and Ronald D. Ormand have personally agreed that if we
      liquidate prior to the consummation of a business combination, they will be
      personally liable to pay debts and obligations to target businesses or vendors
      or other entities that are owed money by us for services rendered or contracted
      for or products sold to us in excess of the net proceeds of our IPO not held
      in
      the trust account. Accordingly, if a claim brought by a target business or
      vendor or other entity did not exceed the amount of funds available to us
      outside of the trust account or available to be released to us from interest
      earned on the trust account balance, Messrs. Coben and Ormand would not have
      any
      personal obligation to indemnify such claims as they would be paid from such
      available funds. However, if a claim exceeded such amounts, there is no
      exception to the obligations of Messrs. Coben and Ormand to pay such
      claim.




**Competition**




In
      identifying, evaluating and selecting a target business, we may encounter
      intense competition from other entities having a business objective similar
      to
      ours. There are numerous blank check companies that have completed initial
      public offerings that are seeking to carry out a business plan similar to our
      business plan. Furthermore, there are likely to be more blank check companies
      filing registration statements for initial public offerings prior to our
      completion of a business combination.




7




We
      may
      also be subject to competition from entities other than blank check companies
      having a business objective similar to ours, including venture capital firms,
      leverage buyout firms and operating businesses looking to expand their
      operations through the acquisition of a target business. Many of these entities
      are well established and have extensive experience identifying and effecting
      business combinations directly or through affiliates. Many of these competitors
      possess greater technical, human and other resources than us and our financial
      resources will be relatively limited when contrasted with those of many of
      these
      competitors. While we believe there may be numerous potential target businesses
      that we could acquire with the net proceeds of our IPO, 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, the
      following may not be viewed favorably by certain target businesses:




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




·
            our
                obligation to convert into cash shares of common stock held by our
                public
                stockholders to such holders that both vote against the business
                combination and exercise their conversion rights may reduce the resources
                available to us for a business combination;
                and




·
            our
                outstanding warrants and the potential future dilution they
                represent.




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




We
      have
      two executive officers. These individuals are not obligated to contribute any
      specific number of hours to our matters and intend to devote only as much time
      as they deem necessary to our affairs. The amount of time they will devote
      in
      any time period will vary based on whether a target business has been selected
      for the business combination and the stage of the business combination process
      the company is in. We do not intend to have any full time employees prior to
      the
      consummation of a business combination.




**ITEM
      1A. RISK FACTORS**




***Risks
      associated with our business***




In
      addition to other information included in this report, the following factors
      should be considered in evaluating our business and future
      prospects.




***We
      are a recently formed development stage company with no operating history and
      no
      revenues, and you have no basis on which to evaluate our ability to achieve
      our
      business objective.***




We
      are a
      recently formed development stage company with no operating results. Because
      we
      lack an operating history, you have no basis upon which to evaluate our ability
      to achieve our business objective of completing an initial business combination
      with one or more target businesses. We will not generate any revenues other
      than
      interest and dividends until, at the earliest, after the consummation of a
      business combination.




8




***We
      may not be able to consummate an initial business combination within the
      required time frame, in which case, we would be forced to liquidate our
      assets.***




Pursuant
      to our amended and restated certificate of incorporation, we have until December
      6, 2009 to complete an initial business combination. If we fail to consummate
      an
      initial business combination within the required time frame, our corporate
      existence will, in accordance with our amended and restated certificate of
      incorporation, cease except for the purposes of winding up our affairs and
      liquidating. We may not be able to find suitable target businesses within the
      required time frame. In addition, our negotiating position and our ability
      to
      conduct adequate due diligence on any potential target may be reduced as we
      approach the deadline for the consummation of an initial business combination.
      We do not have any specific business combination under consideration, and
      neither we, nor any representative acting on our behalf, has had any contacts
      with any target businesses regarding an initial business combination, nor taken
      any direct or indirect actions to locate or search for a target
      business.




***If
      we are forced to liquidate before an initial business combination and distribute
      the trust account, our public stockholders may receive less than $8.00 per
      share
      and our warrants will expire worthless.***




If
      we are
      unable to complete an initial business combination by December 6, 2009 and
      are
      forced to liquidate our assets, the per-share liquidation distribution may
      be
      less than $8.00 because of the expenses of our IPO, our general and
      administrative expenses and the anticipated costs of seeking an initial business
      combination. As of December 31, 2007, the per-share liquidation price was
      approximately $7.97, or $0.03 less than the per-unit offering price of $8.00.
      However, we cannot assure you that we will in fact be able to distribute
      approximately $7.97 per share upon liquidation of the trust account, as a result
      of claims of creditors which may take priority over the claims of our public
      stockholders. Furthermore, there will be no distribution with respect to our
      outstanding warrants which will expire worthless if we liquidate before the
      completion of an initial business combination.




***If
      we are unable to consummate an initial business combination, our public
      stockholders will be forced to wait until December 6, 2009 before receiving
      liquidation distributions.***




We
      have
      until December 6, 2009 to complete an initial business combination. We have
      no
      obligation to return funds to our public stockholders prior to such date unless
      we consummate an initial business combination prior thereto and only then in
      cases where public stockholders have sought conversion of their shares. Only
      after the expiration of this full time period will public stockholders be
      entitled to liquidation distributions if we are unable to complete an initial
      business combination. Accordingly, public stockholders’ funds may be unavailable
      to them until such date.




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




There
      are
      numerous similarly structured blank check companies which have completed initial
      public offerings with business plans similar to ours and 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. While
      some
      of those companies must complete an initial business combination in specific
      industries, a number of them may consummate an initial business combination
      in
      any industry they choose. Therefore, we are 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 an initial business combination within the required time
      period.




9




***If
      the funds available to us are insufficient to allow us to operate until December
      6, 2009, we may be unable to complete an initial business
      combination.***




We
      believe that the funds available to us outside the trust fund, plus the interest
      earned on the funds held in the trust account that may be available to us,
      will
      be sufficient to allow us to operate at least until December 6, 2009, assuming
      that an initial business combination is not consummated during that time.
      However, we cannot assure you that our estimates will be accurate. We could
      use
      a portion of the funds available to us to pay fees to consultants to assist
      us
      with our search for a target business. We could also use a portion of the funds
      as a down payment or to fund a “no-shop” provision (a provision in letters of
      intent designed to keep target businesses from “shopping” around for
      transactions with other companies on terms more favorable to such target
      businesses) with respect to a particular proposed business combination, although
      we do not have any current intention to do so. If we entered into a letter
      of
      intent where we paid for the right to receive exclusivity from a target business
      and were subsequently required to forfeit the funds (whether as a result of
      our
      breach or otherwise), we might not have sufficient funds to continue searching
      for, or conduct due diligence with respect to, a target business.




***If
      we do not conduct an adequate due diligence investigation of a target business
      with which we combine, we may be required to subsequently take write-downs
      or
      write-offs, restructuring, and impairment or other charges that could have
      a
      significant negative effect on our financial condition, results of operations
      and our stock price, which could cause you to lose some or all of your
      investment.***




We
      must
      conduct a due diligence investigation of the target businesses we intend to
      acquire. Intensive due diligence is time consuming and expensive due to the
      operations, accounting, finance and legal professionals who must be involved
      in
      the due diligence process. Even if we conduct extensive due diligence on a
      target business with which we combine, we cannot assure you that this diligence
      will reveal all material issues that may affect a particular target business,
      or
      that factors outside the control of the target business and outside of our
      control will not later arise. If our diligence fails to identify issues specific
      to a target business, industry or the environment in which the target business
      operates, we may be forced to later write-down or write-off assets, restructure
      our operations, or incur impairment or other charges that could result in our
      reporting losses. Even though these charges may be non-cash items and not have
      an immediate impact on our liquidity, the fact that we report charges of this
      nature could contribute to negative market perceptions about us or our common
      stock. In addition, charges of this nature may cause us to violate net worth
      or
      other covenants to which we may be subject as a result of assuming pre-existing
      debt held by a target business or by virtue of our obtaining post-combination
      debt financing.




***A
      decline in interest rates could limit the amount available to fund our search
      for a target business or businesses and complete an initial business combination
      since we will depend on interest earned on the trust account to fund our search,
      to pay our tax obligations and to complete our initial business
      combination.***




We
      will
      depend on sufficient interest being earned on the proceeds held in the trust
      account to provide us with additional working capital which we will need to
      identify one or more target businesses and to complete our initial business
      combination, as well as to pay any tax obligations that we may owe. While we
      are
      entitled to have released to us for such purposes certain interest earned on
      the
      funds in the trust account, a substantial decline in interest rates may result
      in our having insufficient funds available with which to structure, negotiate
      or
      close an initial business combination. In such event, we would need to borrow
      funds from our founders to operate or may be forced to liquidate. Our founders
      are under no obligation to advance funds in such circumstances.




10




***If
      third parties bring claims against us, the proceeds held in trust could be
      reduced and the per-share liquidation price received by stockholders may be
      less
      than approximately $7.97 per share.***




Our
      placing of funds in trust may not protect those funds from third party claims
      against us. Although we are required to have all third parties (including any
      vendors or other entities we engage) and any prospective target businesses
      we
      negotiate with, execute agreements with us waiving any right, title, interest
      or
      claim of any kind in or to any monies held in the trust account, there is no
      guarantee that they will execute such agreements. Furthermore, there is no
      guarantee that, even if such entities execute such agreements with us, they
      will
      not seek recourse against the trust account. Nor is there any guarantee that
      such entities will agree to waive any claims they may have in the future as
      a
      result of, or arising out of, any negotiations, contracts or agreements with
      us
      and will not seek recourse against the trust account for any reason. There
      is
      also no guarantee that a court would uphold the validity of such agreements.
      Accordingly, the proceeds held in trust could be subject to claims which could
      take priority over those of our public stockholders and, as a result, the
      per-share liquidation price could be less than approximately $7.97 due to claims
      of such creditors. If we liquidate before the completion of a business
      combination and distribute the proceeds held in trust to our public
      stockholders, Lawrence S. Coben and Ronald D. Ormand have agreed that they
      will
      be personally 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. However, they may not be able to satisfy those obligations.
      Therefore, we cannot assure you that the per-share distribution from the trust
      account, if we liquidate, will not be less than approximately $7.97, plus
      interest, due to such claims.




Additionally,
      if we are forced to file a bankruptcy case or an involuntary bankruptcy case
      is
      filed against us which is not dismissed, the proceeds held in the trust account
      could be subject to applicable bankruptcy law, and may be included in our
      bankruptcy estate and subject to the claims of third parties with priority
      over
      the claims of our stockholders. To the extent any bankruptcy claims deplete
      the
      trust account, we cannot assure you we will be able to return to our public
      stockholders at least approximately $7.97 per share.




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




If
      we are
      unable to complete an initial business combination by December 6, 2009, our
      corporate existence will cease except for the purposes of winding up our affairs
      and liquidating pursuant to Section 278 of the Delaware General Corporation
      Law,
      in which case we will as promptly as practicable thereafter adopt a plan of
      distribution in accordance with Section 281(b) of the Delaware General
      Corporation Law. Section 278 provides that our existence will continue for
      at
      least three years after its expiration for the purpose of prosecuting and
      defending suits, whether civil, criminal or administrative, by or against us,
      and of enabling us gradually to settle and close our business, to dispose of
      and
      convey our property, to discharge our liabilities and to distribute to our
      stockholders any remaining assets, but not for the purpose of continuing the
      business for which we were organized. Our existence will continue automatically
      even beyond the three-year period for the purpose of completing the prosecution
      or defense of suits begun prior to the expiration of the three-year period,
      until such time as any judgments, orders or decrees resulting from such suits
      are fully executed. Section 281(b) will require us to pay or make reasonable
      provision for all then-existing claims and obligations, including all
      contingent, conditional, or unmatured contractual claims known to us, and to
      make such provision as will be reasonably likely to be sufficient to provide
      compensation for any then-pending claims and for claims that have not been
      made
      known to us or that have not arisen but that, based on facts known to us at
      the
      time, are likely to arise or to become known to us within 10 years after the
      date of dissolution. Accordingly, we would be required to provide for any
      creditors known to us at that time or those that we believe could be potentially
      brought against us within the subsequent 10 years prior to distributing the
      funds held in the trust to stockholders. However, because we are a blank check
      company, rather than an operating company, and our operations will be limited
      to
      searching for prospective target businesses to acquire, the only likely claims
      to arise would be from our vendors (such as accountants, lawyers, investment
      bankers, etc.) and potential target businesses. We intend to have all third
      parties (including any vendors or other entities that we engage in pursuit
      of a
      business combination) and prospective target businesses execute valid and
      enforceable agreements with us waiving any right, title, interest or claim
      of
      any kind in or to any monies held in the trust account. Accordingly, we believe
      the claims that could be made against us should be limited, thereby lessening
      the likelihood that any claim would result in any liability extending to the
      trust. However, we cannot assure you that we will properly assess all claims
      that may be potentially brought against us. As such, our stockholders could
      potentially be liable for any claims to the extent of distributions received
      by
      them (but no more) and any liability of our stockholders may extend well beyond
      the third anniversary of the date of distribution. Accordingly, we cannot assure
      you that third parties will not seek to recover from our stockholders amounts
      owed to them by us.




11




If
      we are
      forced to file a bankruptcy case or an involuntary bankruptcy case is filed
      against us which is not dismissed, any distributions received by stockholders
      could be viewed under applicable debtor/creditor and/or bankruptcy laws as
      either a “preferential transfer” or a “fraudulent conveyance.” As a result, a
      bankruptcy court could seek to recover all amounts received by our stockholders.
      Furthermore, because we intend to distribute the proceeds held in the trust
      account to our public stockholders promptly after December 6, 2009, this may
      be
      viewed or interpreted as giving preference to our public stockholders over
      any
      potential creditors with respect to access to or distributions from our assets.
      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 of punitive damages, by paying public stockholders
      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.




***An
      effective registration statement may not be in place when an investor desires
      to
      exercise warrants, thus precluding such investor from being able to exercise
      his, her or its warrants and causing such warrants to expire
      worthless.***




No
      warrant held by public stockholders will be exercisable and we will not be
      obligated to issue shares of common stock unless, at the time such holder seeks
      to exercise such warrant, a prospectus relating to the common stock issuable
      upon exercise of the warrant is current. Under the terms of the warrant
      agreement, we have agreed to use our best efforts to maintain a current
      prospectus relating to the common stock issuable upon exercise of the warrants
      until the expiration of the warrants. If we do not maintain a current prospectus
      related to the common stock issuable upon exercise of the warrants, holders
      will
      be unable to exercise their warrants and we will not be required to settle
      any
      such warrant exercise. If the prospectus relating to the common stock issuable
      upon the exercise of the warrants is not current, the warrants held by public
      stockholders may have no value, the market for such warrants may be limited
      and
      such warrants may expire worthless. Notwithstanding the foregoing, the insider
      warrants may be exercisable for unregistered shares of common stock even if
      the
      prospectus relating to the common stock issuable upon exercise of the warrants
      is not current.




***An
      investor will only be able to exercise a warrant if the issuance of common
      stock
      upon the exercise has been registered or qualified or is deemed exempt under
      the
      securities laws of the state of residence of the holder of the
      warrants.***




No
      warrants will be exercisable and we will not be obligated to issue shares of
      common stock unless the common stock issuable upon such exercise has been
      registered or qualified or deemed to be exempt under the securities laws of
      the
      state of residence of the holder of the warrants. Because the exemptions from
      qualification in certain states for resales of warrants and for issuances of
      common stock by the issuer upon exercise of a warrant may be different, a
      warrant may be held by a holder in a state where an exemption is not available
      for issuance of common stock upon an exercise and the holder will be precluded
      from exercise of the warrant. At the time that the warrants become exercisable
      (following our completion of a business combination), we expect to continue
      to
      be listed on a national securities exchange, which would provide an exemption
      from registration in every state, or we would register the warrants in every
      state (or seek another exemption from registration in such states). Accordingly,
      we believe holders in every state will be able to exercise their warrants as
      long as our prospectus relating to the common stock issuable upon exercise
      of
      the warrants is current. However, if we are incorrect in this belief, the
      warrants may be deprived of any value, the market for the warrants may be
      limited and the holders of warrants may not be able to exercise their warrants
      if the common stock issuable upon such exercise is not qualified or exempt
      from
      qualification in the jurisdictions in which the holders of the warrants
      reside.




12




***Since
      we have not yet selected any target business with which to complete an initial
      business combination, we are unable to currently ascertain the merits or risks
      of the business’ operations.***




We
      may
      consummate a business combination with a company in any industry we choose
      and
      are not limited to any particular industry or type of business. Accordingly,
      there is no current basis for you to evaluate the possible merits or risks
      of
      the particular industry in which we may ultimately operate or the target
      business which we may ultimately acquire. To the extent we complete a business
      combination with a financially unstable company or an entity in its development
      stage, we may be affected by numerous risks inherent in the business operations
      of that entity. If we complete a business combination with an entity in an
      industry characterized by a high level of risk, we may be affected by the
      currently unascertainable risks of that industry. We may not properly ascertain
      or assess all of the significant risk factors inherent in a particular industry
      or target business. An investment in our units may also ultimately prove to
      be
      less favorable to investors than a direct investment, if an opportunity were
      available, in a target business.




***We
      may issue shares of our capital stock or debt securities to complete an initial
      business combination. Issuance of our capital stock would reduce the equity
      interest of our stockholders and may cause a change in control of our ownership,
      while the issuance of debt securities may have a significant impact on our
      ability to utilize our available cash.***




Our
      amended and restated certificate of incorporation authorizes the issuance of
      up
      to 35,000,000 shares of common stock, par value $.0001 per share, and 1,000,000
      shares of preferred stock, par value $.0001 per share. There are currently
      10,451,494 authorized but unissued shares of common stock available for issuance
      (after appropriate reservation for the issuance of the shares upon full exercise
      of our outstanding warrants) and all of the 1,000,000 shares of preferred stock
      available for issuance. We may issue a substantial number of additional shares
      of our common or preferred stock, or a combination of common and preferred
      stock, to complete an initial business combination. The issuance of additional
      shares of common stock or any number of shares of our preferred stock:




·
            may
                significantly reduce your equity interest in
                us;




·
            may
                subordinate the rights of holders of shares of common stock if we
                issue
                preferred stock with rights senior to those afforded to our common
                stock;




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




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




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




·
            default
                and foreclosure on our assets if our operating revenues after an
                initial
                business combination are insufficient to repay our debt
                obligations;




13




·
            acceleration
                of our obligations to repay the indebtedness even if we make all
                principal
                and interest payments when due if we breach certain covenants that
                require
                the maintenance of certain financial ratios or reserves without a
                waiver
                or renegotiation of that covenant;




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




·
            our
                inability to obtain necessary additional financing if the debt security
                contains covenants restricting our ability to obtain such financing
                while
                the debt security is outstanding.




The
      value
      of your investment in us may decline if any of these events occur.




***Resources
      could be wasted in researching acquisitions that are not consummated, which
      could materially adversely affect subsequent attempts to locate and acquire
      or
      merge with another business.***




It
      is
      anticipated that the investigation of each specific target business and the
      negotiation, drafting, and execution of relevant agreements, disclosure
      documents, and other instruments will require substantial management time and
      attention and substantial costs for accountants, attorneys and others. If a
      decision is made not to complete a specific business combination, the costs
      incurred up to that point for the proposed transaction likely would not be
      recoverable. Furthermore, even if an agreement is reached relating to a specific
      target business, we may fail to consummate the initial business combination
      for
      any number of reasons including those beyond our control, such as that public
      stockholders owning 30% or more of the IPO shares vote against the initial
      business combination and opt to have us convert their stock for a pro rata
      share
      of the trust account even if a majority of our stockholders approve the initial
      business combination. Any such event will result in a loss to us of the related
      costs incurred which could materially adversely affect subsequent attempts
      to
      locate and acquire or merge with another business.




***Our
      ability to successfully effect an initial business combination and to be
      successful thereafter will be totally dependent upon the efforts of our key
      personnel, some of whom may join us following an initial business
      combination.***




Our
      ability to successfully effect a business combination is dependent upon the
      efforts of our key personnel. The role of our key personnel in the operation
      of
      the target business, however, cannot presently be ascertained. Although some
      of
      our key personnel may remain with the target business in senior management
      or
      advisory positions following a business combination, it is likely that some
      or
      all of the management of the target business will remain in place. These
      individuals may be unfamiliar with the requirements of operating a public
      company, which could cause us to have to expend time and resources helping
      them
      become familiar with such requirements. This could be expensive and
      time-consuming and could lead to various regulatory issues which may adversely
      affect our operations.




***Our
      key personnel may negotiate employment or consulting agreements with a target
      business in connection with a particular business combination. These agreements
      may provide for them to receive compensation following an initial business
      combination and as a result, may cause them to have conflicts of interest in
      determining whether a particular business combination is the most
      advantageous.***




Our
      key
      personnel will be able to remain with the company after the consummation of
      a
      business combination only if they are able to negotiate employment or consulting
      agreements in connection with the business combination. Such negotiations would
      take place simultaneously with the negotiation of the business combination
      and
      could provide for such individuals to receive compensation in the form of cash
      payments and/or our securities for services they would render to the company
      after the consummation of the business combination. The personal and financial
      interests of such individuals may influence their motivation in identifying
      and
      selecting a target business.




14




***Our
      officers and directors will 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 conflict of interest could have a negative impact
      on
      our ability to consummate an initial business
      combination.***




Our
      officers and directors are not required to commit their full time to our
      affairs, which could create a conflict of interest when allocating their time
      between our operations and their other commitments. We do not intend to have
      any
      full time employees prior to the consummation of an initial business
      combination. All of our executive officers and directors are engaged in several
      other business endeavors and are not obligated to devote any specific number
      of
      hours to our affairs. If our officers’ and directors’ 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 an initial business combination.
      We
      cannot assure you that these conflicts will be resolved in our
      favor.




***Our
      officers and directors 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 allocating their time and
      determining to which entity a particular business opportunity should be
      presented.***




Our
      officers and directors may in the future become affiliated with entities,
      including other “blank check” companies, engaged in business activities similar
      to those intended to be conducted by us. Additionally, our officers and
      directors may become aware of business opportunities which may be appropriate
      for presentation to us and the other entities to which they owe fiduciary
      duties. Accordingly, they may have conflicts of interest in determining to
      which
      entity time should be allocated or a particular business opportunity should
      be
      presented. We cannot assure you that these conflicts will be resolved in our
      favor. As a result, a potential target business may be presented to another
      entity prior to its presentation to us and we may miss out on a potential
      transaction.




***All
      of our officers and directors own founders’ shares and some of them own warrants
      purchased simultaneously with our IPO. These shares and warrants will not
      participate in liquidation distributions and, therefore, our officers and
      directors may have a conflict of interest in determining whether a particular
      target business is appropriate for an initial business
      combination.***




All
      of
      our officers and directors own founders’ shares. Additionally, certain of our
      officers and directors purchased sponsors’ warrants simultaneously with our IPO.
      Such individuals have waived their right to receive distributions with respect
      to their initial shares upon our liquidation if we are unable to consummate
      a
      business combination. Accordingly, the shares acquired prior to our IPO, as
      well
      as the sponsors’ warrants, will be worthless if we do not consummate a business
      combination. The personal and financial interests of our directors and officers
      may influence their motivation in timely identifying and selecting a target
      business and completing a business combination. Consequently, our directors’ and
      officers’ discretion in identifying and selecting a suitable target business may
      result in a conflict of interest when determining whether the terms, conditions
      and timing of a particular business combination are appropriate and in our
      stockholders’ best interest.




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




Our
      securities are currently quoted on the American Stock Exchange. In order to
      continue quotation of our securities, we must maintain certain financial,
      distribution and stock price levels. Generally, we must maintain a minimum
      amount in stockholders’ equity (usually between $2,000,000 and $4,000,000) and a
      minimum number of public shareholders (usually 300 shareholders). Additionally,
      our securities cannot have what is deemed to be a “low selling price” as
      determined by the Exchange. Additionally, in connection with our business
      combination, it is likely that the American Stock Exchange will require us
      to
      file a new initial listing application and meet its initial listing requirements
      as opposed to these more lenient continued listing requirements. We cannot
      assure you that we will be able to meet those initial listing requirements
      at
      that time.




15




If
      the
      American Stock Exchange delists our securities from trading on its exchange,
      we
      could face significant material adverse consequences, including:




·
            a
                limited availability of market quotations for our
                securities;




·
            reduced
                liquidity with respect to our
                securities;




·
            a
                determination that our common stock is a “penny stock” which will require
                brokers trading in our common stock to adhere to more stringent rules,
                possibly resulting in a reduced level of trading activity in the
                secondary
                trading market for our common
                stock;




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




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




***We
      may only be able to complete one business combination with the proceeds of
      our
      IPO, which will cause us to be solely dependent on a single business which
      may
      have a limited number of products or services.***




Our
      initial business combination must be with a target business having an aggregate
      fair market value of at least 80% of our net assets at the time of such
      acquisition, although this may entail the simultaneous acquisitions of several
      operating businesses at the same time. However, we may not be able to acquire
      more than one target business because of various factors, including the
      existence of complex accounting issues and the requirement that we prepare
      and
      file pro forma financial statements with the SEC that present operating results
      and the financial condition of several target businesses as if they had been
      operated on a combined basis. By consummating an initial business combination
      with only a single entity, our lack of diversification may subject us to
      numerous economic, competitive and regulatory developments. Further, we would
      not be able to diversify our operations or benefit from the possible spreading
      of risks or offsetting of losses, unlike other entities which may have the
      resources to complete several business combinations in different industries
      or
      different areas of a single industry. Accordingly, the prospects for our success
      may be:




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




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




This
      lack
      of diversification may subject us to numerous economic, competitive and
      regulatory developments, any or all of which may have a substantial adverse
      impact upon the industry in which we ultimately operate.




***If
      we determine to simultaneously acquire several businesses, we will need the
      acquisitions to be consummated at the same time, thereby making it more
      difficult for us to consummate a business
      combination.***




If
      we
      determine to simultaneously acquire several businesses and such businesses
      are
      owned by different sellers, we will need for each of such sellers to agree
      that
      our purchase of its business is contingent on the simultaneous closings of
      the
      other business combinations, which may make it more difficult for us, and delay
      our ability, to complete the business combination. With multiple business
      combinations, we could also face additional risks, including additional burdens
      and costs with respect to possible multiple negotiations and due diligence
      investigations (if there are multiple sellers) and the additional risks
      associated with the subsequent assimilation of the operations and services
      or
      products of the acquired companies in a single operating business. If we are
      unable to adequately address these risks, it could negatively impact our
      profitability and results of operations.




16




***We
      may proceed with an initial business combination even if public stockholders
      owning approximately 30% of the shares sold in the IPO exercise their conversion
      rights.***




We
      may
      proceed with an initial business combination as long as public stockholders
      owning less than 30% of the IPO shares exercise their conversion rights.
      Accordingly, public stockholders holding up to approximately 29.99% of the
      IPO
      shares may exercise their conversion rights and we could still consummate a
      proposed business combination. We have set the conversion percentage at 30%
      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 an initial business
      combination that is otherwise approved by a large majority of our public
      stockholders.




Our
      business combination may require us to use substantially all of our cash to
      pay
      the purchase price. In such a case, because we will not know how many
      stockholders may exercise such conversion rights, we may need to arrange third
      party financing to help fund our business combination in case a larger
      percentage of stockholders exercise their conversion rights than we expect.
      Additionally, even if our business combination does not require us to use
      substantially all of our cash to pay the purchase price, if a significant number
      of stockholders exercise their conversion rights, we will have less cash
      available to use in furthering our business plans following an initial business
      combination and may need to arrange third party financing. We have not taken
      any
      steps to secure third party financing for either situation. We cannot assure
      you
      that we will be able to obtain such third party financing on terms favorable
      to
      us or at all.




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




When
      we
      seek stockholder approval of any business combination, we will offer each public
      stockholder (but not our founders) the right to have his, her or its shares
      of
      common stock converted to cash if the stockholder votes against the initial
      business combination and the initial business combination is approved and
      completed. Such holder must both vote against such business combination and
      then
      exercise his, her or its conversion rights to receive a pro rata portion of
      the
      trust account. 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 stockholders may exercise such conversion rights, we may either
      need to reserve part of the trust account for possible payment upon conversion,
      or we may need to arrange third party financing to help fund our business
      combination in case a larger percentage of public stockholders exercise their
      conversion rights than we expect. Since we have no specific business combination
      under consideration, we have not taken any steps to secure third party
      financing. Therefore, we may not be able to consummate an initial 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
      may require stockholders who wish to convert their shares in connection with
      a
      proposed business combination to comply with specific requirements for
      conversion that may make it more difficult for them to exercise their conversion
      rights prior to the deadline for exercising their
      rights.***




We
      may
      require public stockholders who wish to convert their shares in connection
      with
      a proposed business combination to either tender their certificates to our
      transfer agent at any time prior to the vote taken at the stockholder meeting
      relating to such initial business combination or to deliver their shares to
      the
      transfer agent electronically using the Depository Trust Company’s DWAC
      (Deposit/Withdrawal At Custodian) System. In order to obtain a physical stock
      certificate, a stockholder’s broker and/or clearing broker, DTC and our transfer
      agent will need to act to facilitate this request. It is our understanding
      that
      stockholders should generally allot at least two weeks to obtain physical
      certificates from the transfer agent. However, because we do not have any
      control over this process or over the brokers or DTC, it may take significantly
      longer than two weeks to obtain a physical stock certificate. While we have
      been
      advised that it takes a short time to deliver shares through the DWAC System,
      we
      cannot assure you of this fact. Accordingly, if it takes longer than we
      anticipate for stockholders to deliver their shares, stockholders who wish
      to
      convert may be unable to meet the deadline for exercising their conversion
      rights and thus may be unable to convert their shares.




17




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




We
      expect
      to encounter intense competition from entities other than blank check companies
      having a business objective similar to ours, including venture capital funds,
      leveraged buyout funds and operating businesses competing for acquisitions.
      Many
      of these entities are well established and have extensive experience in
      identifying and effecting business combinations directly or through affiliates.
      Many of these competitors possess greater technical, human and other resources
      than we do and our financial resources will be relatively limited when
      contrasted with those of many of these competitors. Our ability to compete
      in
      acquiring certain sizable target businesses will be limited by our available
      financial resources. Furthermore, the obligation we have to seek stockholder
      approval of a business combination may delay the consummation of a transaction.
      Additionally, our outstanding warrants, and the future dilution they potentially
      represent, may not be viewed favorably by certain target businesses. Any of
      these obligations may place us at a competitive disadvantage in successfully
      negotiating a business combination. Additionally,
      because of our structure, there may be fewer attractive target businesses
      available to acquire or privately held target businesses may not be inclined
      to
      enter into a transaction with a publicly held blank check company like
      us.




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




If
      the
      net proceeds of our IPO prove to be insufficient to allow us to consummate
      a
      particular business combination either because of the size of the business
      combination, the depletion of the available net proceeds in search of a target
      business, or the obligation to convert into cash a significant number of shares
      from dissenting stockholders, we will be required to seek additional financing.
      Such financing may not 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 either
      restructure the transaction or abandon that particular business combination
      and
      seek an alternative target business candidate. In addition, if we consummate
      a
      business combination, we may require additional financing to fund the operations
      or growth of the target business. The failure to secure additional financing
      could have a material adverse effect on the continued development or growth
      of
      the target business. None of our officers, directors or stockholders is required
      to provide any financing to us in connection with or after a business
      combination.




***Our
      founders, including our officers, directors and special advisors, control a
      substantial interest in us and thus may influence certain actions requiring
      a
      stockholder vote.***




Our
      founders (including all of our officers and directors) collectively own 20%
      of
      our issued and outstanding shares of common stock. Our founders are not
      restricted from purchasing additional units or shares of common stock in the
      open market or in private tractions. Additional purchases of shares of common
      stock by our founders, including our officers or directors, would likely allow
      them to exert more influence over the approval of our initial business
      combination. These individuals may have substantial financial interests in
      making these types of purchases. The factors that would be considered in making
      such additional purchases would include consideration of the current trading
      price of our common stock. Another factor that would be taken into consideration
      would be that any such additional purchases would likely increase the chances
      that our initial business combination would be approved. Furthermore, these
      purchases may make it less likely that the holders of 30% or more of the IPO
      shares vote against a business combination and exercise their conversion rights.




18




Our
      board
      of directors is and will be divided into three classes, each of which will
      generally serve for a term of three years with only one class of directors
      being
      elected in each year. It is unlikely that there will be an annual meeting of
      stockholders to elect new directors prior to the consummation of an initial
      business combination, in which case all of the current directors will continue
      in office until at least the consummation of the initial business combination.
      If there is an annual meeting, as a consequence of our “staggered” board of
      directors, only a minority of the board of directors will be considered for
      election and our founders, because of their ownership position, will have
      considerable influence regarding the outcome. Accordingly, our founders will
      continue to exert control at least until the consummation of an initial business
      combination.




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




We
      issued
      warrants to purchase 9,732,669 shares of common stock as part of the units
      offered in the IPO. We also sold the sponsors’ warrants to purchase 2,650,000
      shares of common stock. To the extent we issue shares of common stock to effect
      an initial business combination, the potential for the issuance of a substantial
      number of additional shares upon exercise of these warrants could make us a
      less
      attractive acquisition vehicle in the eyes of a target business. Such
      securities, when exercised, will increase the number of issued and outstanding
      shares of common stock and reduce the value of the shares issued to complete
      the
      initial business combination. Accordingly, our warrants may make it more
      difficult to effectuate an initial business combination or increase the cost
      of
      acquiring the target business. Additionally, the sale, or even the possibility
      of a sale, of the shares underlying the warrants could have an adverse effect
      on
      the market price for our securities or on our ability to obtain future
      financing. If and to the extent these warrants are exercised, you may experience
      a substantial dilution of your holdings.




***Our
      management’s ability to require holders of our warrants to exercise such
      warrants on a cashless basis will cause holders to receive fewer shares of
      common stock upon their exercise of the warrants than they would have received
      had they been able to exercise their warrants for
      cash.***




If
      we
      call our warrants for redemption after the redemption criteria described in
      the
      prospectus for our IPO have been satisfied, our management will have the option
      to require any holder that wishes to exercise his warrant to do so on a
“cashless basis.” If our management chooses to require holders to exercise their
      warrants on a cashless basis, the number of shares of common stock received
      by a
      holder upon exercise will be fewer than it would have been had such holder
      exercised his warrant for cash. This will have the effect of reducing the
      potential “upside” of the holder’s investment in our company.




***If
      our founders or the holders of the sponsors’ warrants exercise their
      registration rights with respect to their founders’ shares or sponsors’ warrants
      and underlying shares, it may have an adverse effect on the market price of
      our
      common stock and the existence of these rights may make it more difficult to
      effect an initial business combination.***




The
      founders are entitled to demand that we register the resale of the founders’
shares at any time commencing nine months after the consummation of our initial
      business combination. Additionally, the holders of the sponsors’ warrants are
      entitled to demand that we register the resale of such warrants and underlying
      shares of common stock at any time after we consummate an initial business
      combination. If such individuals exercise their registration rights with respect
      to all of their securities, then there will be an additional 2,433,168 shares
      of
      common stock and 2,650,000 warrants (as well as 2,650,000 shares of common
      stock
      underlying the warrants) eligible for trading in the public market. The presence
      of these additional securities trading in the public market may have an adverse
      effect on the market price of our common stock. In addition, the existence
      of
      these rights may make it more difficult to effectuate an initial business
      combination or increase the cost of acquiring the target business, as the
      stockholders of the target business may be discouraged from entering into an
      initial business combination with us or will request a higher price for their
      securities because of the potential negative effect the exercise of such rights
      may have on the trading market for our common stock.




19




***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 an initial business
      combination.***




A
      company
      that, among other things, is or holds itself out as being engaged primarily,
      or
      proposes to engage primarily, in the business of investing, reinvesting, owning,
      trading or holding certain types of securities would be deemed an investment
      company under the Investment Company Act of 1940. Since we have invested the
      IPO
      proceeds held in the trust account, it is possible that we could be deemed
      an
      investment company. Notwithstanding the foregoing, 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 be invested by the trustee
      only in United States “government securities” within the meaning of Section
      2(a)(16) of the Investment Company Act of 1940 having a maturity of 180 days
      or
      less or in money market funds meeting certain conditions under Rule 2a-7
      promulgated under the Investment Company Act of 1940. By restricting the
      investment of the proceeds to these instruments, we intend to meet the
      requirements for the exemption provided in Rule 3a-1 promulgated under the
      Investment Company Act of 1940.




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




·
            restrictions
                on the nature of our investments;
                and




·
            restrictions
                on the issuance of securities.




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




·
            registration
                as an investment company;




·
            adoption
                of a specific form of corporate structure;
                and




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




Compliance
      with these additional regulatory burdens would require additional expense for
      which we have not allotted.




***If
      we effect an initial business combination with a company located outside of
      the
      United States, we would be subject to a variety of additional risks that may
      negatively impact our operations.***




We
      may
      effect an initial business combination with a company located outside of the
      United States. If we do, we would be subject to any special considerations
      or
      risks associated with companies operating in the target business’ home
      jurisdiction, including any of the following:




·
            rules
                and regulations or currency conversion or corporate withholding taxes
                on
                individuals;




20




·
            tariffs
                and trade barriers;




·
            regulations
                related to customs and import/export
                matters;




·
            longer
                payment cycles;




·
            tax
                issues, such as tax law changes and variations in tax laws as compared
                to
                the United States;




·
            currency
                fluctuations and exchange controls;




·
            challenges
                in collecting accounts receivable;




·
            cultural
                and language differences; and




·
            employment
                regulations.




If
      we
      were unable to adequately address these additional risks, our operations might
      suffer.




***If
      we effect an initial business combination with a company located outside of
      the
      United States, the laws applicable to such company will likely govern all of
      our
      material agreements and we may not be able to enforce our legal
      rights.***




If
      we
      effect an initial business combination with a company located outside of the
      United States, the laws of the country in which such company operates will
      govern almost all of the material agreements relating to its operations. We
      cannot assure you that the target business will be able to enforce any of its
      material agreements or that remedies will be available in this new jurisdiction.
      The system of laws and the enforcement of existing laws in such jurisdiction
      may
      not be as certain in implementation and interpretation as in the United States.
      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, if we acquire a company located outside of the United
      States, it is likely that substantially all of our assets would be located
      outside of the United States and some of our officers and directors might reside
      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.




**Risks
      Associated with the Energy and Environmental Industries and Their Related
      Infrastructures**




Business
      combinations with companies with operations in the energy and environmental
      industries and their related infrastructures entail special considerations
      and
      risks. If we are successful in completing a business combination with a target
      business with operations in the energy and environmental industries and their
      related infrastructures, we will be subject to, and possibly adversely affected
      by, the following risks:




***Fluctuations
      in energy prices may cause a reduction in the demand or profitability of the
      products or services we may ultimately produce or
      offer.***




Prices
      for energy sources such as oil and natural gas tend to fluctuate widely based
      on
      a variety of political and economic factors. These price fluctuations heavily
      influence both the energy and environmental industries and their related
      infrastructures. Lower energy prices for existing products tend to limit the
      demand for alternate forms of energy services and related products and
      infrastructure. Factors that impact price fluctuations include the actions
      of
      the members of the Organization of Petroleum Exporting Countries, or OPEC,
      the
      level of production by non-OPEC countries, worldwide demand for oil and natural
      gas, political tensions involving OPEC and non-OPEC countries and other varying
      factors. If we complete a business combination with a target business that
      is
      involved with an energy source that is affected by these or other factors,
      there
      may be a decrease in the demand for the products or services we may ultimately
      produce or offer and our profitability could be adversely affected.




21




***Changes
      in technology may render our products or services obsolete following a business
      combination.***




Both
      the
      energy and environmental industries and their related infrastructures are
      substantially affected by rapid and significant changes in technology. These
      changes may render certain existing services and technologies currently used
      obsolete. The technologies used by or relied upon by a target business with
      which we effect a business combination may be subject to such obsolescence.
      While we may attempt to adapt and apply the services provided by the target
      business to newer technologies, our resources may be insufficient to fund these
      changes or these changes may ultimately prove unsuccessful.




***Failure
      to comply with governmental regulations could result in the imposition of
      penalties, fines or restrictions on operations and remedial
      liabilities.***




Both
      the
      energy and environmental industries are subject to extensive federal, state
      and
      local laws and regulations related to health and safety and those associated
      with compliance and permitting obligations (including those related to the
      use,
      storage, handling, discharge, emission and disposal of municipal solid waste
      and
      other waste, pollutants or hazardous substances or wastes, or discharges and
      air
      and other emissions) as well as land use and development. Existing laws also
      impose obligations to clean up contaminated properties or to pay for the cost
      of
      such remediation, often upon parties that did not actually cause the
      contamination. Compliance with these laws, regulations and obligations could
      require substantial capital expenditures. Failure to comply could result in
      the
      imposition of penalties, fines or restrictions on operations and remedial
      liabilities. These costs and liabilities could adversely affect our operations
      following a business combination. These laws, regulations and obligations could
      change with the promulgation of new laws and regulations or a change in the
      interpretation of existing laws and regulations, which could result in
      substantially similar risks. We may not be able to comply with existing or
      new
      regulations.




***If
      we are unable to acquire or renew permits and approvals required for our
      operations following a business combination, we may be forced to suspend or
      cease our operations altogether.***




The
      construction and operation of energy projects require numerous permits and
      approvals from governmental agencies. We may not be able to obtain all necessary
      permits and approvals following a business combination. If we are unable to
      obtain or renew permits or approvals necessary for the operation of our business
      following a business combination, our operations would be adversely affected.
      In
      addition, obtaining all necessary permits and approvals may necessitate
      substantial expenditures and may create a significant risk of expensive delays
      or loss of value if a project is unable to function as planned due to changing
      requirements or local opposition.




***Regulation
      within the energy industry could reduce our profitability following a business
      combination.***




Essentially
      all of the energy sectors including electric generation, transmission and
      distribution, natural gas transmission and distribution, and oil transportation
      are subject to highly technical Federal and state regulatory regimes. Rates,
      terms of service, facility sites, financing, dividend payments, wages,
      divestitures, changes in control and business dealings with affiliates are
      all
      subject to ongoing regulatory disclosure and approval on the merits. The failure
      or refusal of any jurisdictional regulator to grant approval as to any
      particular rate, service or transaction could prove harmful to us, as could
      the
      occurrence of any dispute with a regulator.




22




**ITEM
      1B. UNRESOLVED STAFF COMMENTS**




None.




**ITEM
      2. PROPERTY**




We
      maintain our principal executive offices at 11622 Monica Street, Houston, Texas
      77024. An affiliate of ours is providing this space to us at no charge. We
      consider our current office space, combined with the other office space
      otherwise available to our executive officers, adequate for our current
      operations.




**ITEM
      3. LEGAL PROCEEDINGS**




None.




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




None.




**PART
      II**




**ITEM
      5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES
      OF EQUITY SECURITIES**




**Market
      Information**




Our
      units, common stock and warrants are listed on the American Stock Exchange
      under
      the symbols TGY.U, TGY and TGY.WS, respectively. The following table sets forth
      the range of high and low sales prices for the units, common stock and warrants
      for the periods indicated since the units commenced public trading on December
      12, 2007, and since the common stock and warrants commenced public trading
      on
      March 5, 2008 .




Units
            
            Common
                Stock
            
            WarrantsHigh
            
            Low
            
            High
            
            Low
            
            High
            
            Low2008:First
                Quarter*
            
            $
            8.05
            
            $
            7.55
            
            $
            7.21
            
            $
            7.18
            
            $
            0.65
            
            $
            0.482007:Fourth
                Quarter
            
            $
            8.00
            
            $
            7.90
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A




*
      Through
      March 20, 2008.




23




**Holders**




As
      of
      March 25, 2008, there was one holder of record of our units, 19 holders of
      record of our common stock and 18 holder of record of our warrants.




**Dividends**




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




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




In
      July
      2007, we sold the following shares of common stock without registration under
      the Securities Act of 1933, as amended:




Stockholders
            
            Number
                of SharesLawrence
                S. Coben
            
            
            2,406,250Jon
                Schotz
            
            
            150,000Charles
                A. Norris
            
            
            150,000Stephen
                N. Casati
            
            
            25,000





Such
      shares were issued in connection with our organization pursuant to the exemption
      from registration contained in Section 4(2) of the Securities Act as they were
      sold to sophisticated, wealthy individuals or entities. The shares issued to
      the
      individuals and entities above were sold at a purchase price of approximately
      $0.009 per share.





In
      September 2007, Lawrence S. Cohen transferred 1,203,125 shares of common stock
      to Ronald D. Ormand, our president, chief financial officer and member of our
      board of directors, for approximately $0.009 per share. In October 2007, Messrs.
      Coben and Ormand transferred an aggregate of 281,250 shares of common stock
      to
      (i) Bill Armstrong (42,185 shares of common stock), (ii) Dean Vanech (37,500
      shares of common stock), (iii) Jerry Doren, Owen Coleman, Bill Goldstein and
      Trevor Wilson (each 28,125 shares of common stock), (iv) David A. Preiser
      (18,750 shares of common shares) and (v) Brian McInerny, Richard Kassar, David
      Levine, Jim Land and Dr. John Jacobs (each 14,063 shares of common stock),
      all
      for approximately $0.009 per share. In November 2007, Messrs. Coben and Ormand
      transferred an aggregate of 187,500 shares of common stock to Gary Evans for
      approximately $0.009 per share.





Simultaneously
      with the consummation of the IPO, we consummated the private sale of 2,650,000
      sponsors’ warrants at a price of $1.00 per sponsors’ warrant, generating total
      proceeds of $2,650,000. The sponsors’ warrants were purchased by Lawrence S.
      Coben, our chairman of the board and chief executive officer, Ronald D. Ormand,
      our president, chief financial officer and member of our board of directors,
      Jon
      Schotz and Charles A. Norris, each a member of our board of directors, and
      Bill
      Goldstein, Dean Vanech, Jerry Doren, Owen Coleman, Bill Armstrong, Trevor
      Wilson, Brian McInerny, Richard Kassar, David Levine, Jim Land, David A.
      Preiser, Gary Evans and Dr. John Jacobs, each a stockholder of ours.




24





**Initial
      Public Offering**





On
      December 12, 2007, we closed our initial public offering of 9,500,000 units
      with
      each unit consisting of one share of our common stock and one warrant, each
      to
      purchase one share of our common stock at an exercise price of $5.00 per share.
      On January 24, 2008, we consummated the closing of an additional 232,669 units
      which were subject to the over-allotment option. The units from the initial
      public offering (including the over-allotment option) were sold at an offering
      price of $8.00 per unit, generating total gross proceeds of $77,861,352. Merrill
      Lynch, Pierce, Fenner & Smith Incorporated acted as representative of the
      underwriters. The securities sold in the offering were registered under the
      Securities Act of 1933 on a registration statement on Form S-1 (No. 333-145625).
      The Securities and Exchange Commission declared the registration statement
      effective on December 6, 2007.




We
      paid a
      total of $2,335,841 in underwriting discounts and commissions and incurred
      $602,705 for other costs and expenses related to the offering and the
      over-allotment option. After deducting the underwriting discounts and
      commissions and the offering expenses, the total net proceeds to us from the
      offering and the private sale of sponsors’ warrants were $77,572,806, of which
      $77,400,511 ($75,595,000 on December 12, 2007 and $1,805,511 on January 24,
      2008) was deposited into the trust account. The remaining proceeds became
      available to be used to provide for business, legal and accounting due diligence
      on prospective business combinations and continuing general and administrative
      expenses. The net proceeds deposited into the trust fund remain on deposit
      in
      the trust fund and earned $152,990 in interest through December 31,
      2007.




**ITEM
      6. SELECTED FINANCIAL DATA**




The
      selected financial data set forth below is derived from our audited financial
      statements. This selected financial data should be read in conjunction with
      the
      section under the caption “Management’s Discussion and Analysis of Financial
      Condition and Results of Operations” and the Consolidated Financial Statements
      included elsewhere in this Annual Report on Form 10-K:





Period
                from inception
              (July
                3, 2007) to**Statement
                of Operations Data:**
            
            December
                31, 2007Interest
                Income
            
            $
            152,990General
                and administrative expenses
            
            
            51,370Provision
                for income taxes
            
            
            25,000Net
                income
            
            
            76,620Accretion
                of Trust Account relating tocommon
                stock subject to possible conversion
            
            
            (45,882
            )Net
                income attributable to common stockholders
            
            
            30,738Earnings
                per share data:Weighted
                average number of shares outstanding, basic and diluted:
            
            
            3,462,124Net
                income per share, basic and diluted
            
            $
            0.01Number
                of shares outstanding subject topossible
                conversion
            
            
            2,849,050Net
                  income per share subject to possible conversion, basic and
                  diluted:
            
            $
            0.02**Statement
                of Cash Flows Data:**Net
                cash used in operating activities
            
            $
            (108,339
            )Cash
                contributed to Trust Account
            
            
            (75,595,000
            )Net
                  proceeds from public offering allocable to stockholders'
                  equity
            
            
            50,459,235Portion
                  of net proceeds from public offering allocable to common stock
                  subject to
                  possible conversion
            
            
            22,670,940Proceeds
                from issuance of insider warrants
            
            
            2,650,000December
                31,
              2007**Selected
                Balance Sheet Data:**Cash
                and cash equivalents
            
            $
            101,836Investments
                held in Trust Account including accrued interest
            
            
            75,747,990Total
                assets
            
            
            75,940,612Common
                stock subject to possible conversion
            
            
            22,716,822Total
                stockholders' equity
            
            
            50,112,093





25




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




**Forward
      Looking Statements**





All
      statements other than statements of historical fact included in this Form 10-K
      including, without limitation, statements under “Management’s Discussion and
      Analysis of Financial Condition and Results of Operations” regarding our
      financial position, business strategy and the plans and objectives of management
      for future operations, are forward looking statements. When used in this Form
      10-K, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend” and
      similar expressions, as they relate to us or our management, identify forward
      looking statements. Such forward looking statements are based on the beliefs
      of
      management, as well as assumptions made by, and information currently available
      to, our management. Actual results could differ materially from those
      contemplated by the forward looking statements as a result of certain factors
      detailed in our filings with the Securities and Exchange Commission. All
      subsequent written or oral forward looking statements attributable to us or
      persons acting on our behalf are qualified in their entirety by this
      paragraph.





**Overview**





We
      were
      formed on July 3, 2007, to serve as a vehicle to effect a merger, capital stock
      exchange, asset acquisition, or other similar business combination with an operating
      business. Our efforts in identifying a prospective target business will not
      be
      limited to a particular industry, although we intend to focus our efforts on
      acquiring an operating business in either the energy or the environmental
      industry and their related infrastructures.




**Results
      of Operations**




For
      the
      period from July 3, 2007 (inception) to December 31, 2007, we had net income
      of
      $76,620. Income of $152,990 consisted of interest on the cash held in trust.
      Expenses for the period totalled $51,370 and a provision for income taxes was
      $25,000.




26




**Financial
      Condition and Liquidity**




We
      consummated our initial public offering of 9,500,000 units on December 12,
      2007.
      Gross proceeds from our initial public offering were $76,000,000. We paid a
      total of $2,280,000 in underwriting discounts and commissions and incurred
      $602,705 for costs and expenses related to the offering. An additional
      $3,040,000 of underwriting discounts and commissions has been deferred by the
      underwriters and placed in our trust account and will be released to the
      underwriters only on completion of our initial business combination. After
      deducting the underwriting discounts and commissions and the offering expenses,
      the total net proceeds, including $2,650,000 from the private sale of warrants
      (the “Sponsor’s Warrants”) to Lawrence S. Coben, our chairman of the board and
      chief executive officer, Ronald D. Ormand, our president, chief financial
      officer and member of our board of directors, Jon Schotz and Charles A. Norris,
      each a member of our board of directors, and Bill Goldstein, Dean Vanech, Jerry
      Doren, Owen Coleman, Bill Armstrong, Trevor Wilson, Brian McInerny, Richard
      Kassar, David Levine, Jim Land, David A. Preiser, Gary Evans and Dr. John
      Jacobs, each a stockholder of ours, from the offering were $75,767,295, of
      which
      $75,595,000 was deposited into the trust account. We intend to use substantially
      all of the net proceeds of this offering to effect a business combination.
      To
      the extent that our capital stock is used in whole or in part as consideration
      to effect a business combination, the proceeds held in the trust account as
      well
      as any other net proceeds not expended will be used to finance the operations
      of
      the target business. We believe we will have sufficient available funds outside
      of the trust fund to operate through December 6, 2009, assuming that a business
      combination is not consummated during that time.




We
      expect
      our primary liquidity requirements during this period to include approximately
      $200,000 for expenses for the due diligence and investigation of a target
      business or businesses; approximately $500,000 for legal, accounting and other
      expenses associated with structuring, negotiating and documenting an initial
      business combination; $150,000 for legal and accounting fees relating to our
      SEC
      reporting obligations; and approximately $500,000 for general working capital
      that will be used for miscellaneous expenses and reserves. We do not believe
      we
      will need to raise additional funds following this offering in order to meet
      the
      expenditures required for operating our business. However, we may need to raise
      additional funds through a private offering of debt or equity securities if
      such
      funds are required to consummate a business combination that is presented to
      us.
      We would only consummate such a financing simultaneously with the consummation
      of a business combination.





In
      addition, in July and August of 2007, Lawrence S. Coben and Ronald D. Ormand
      advanced an aggregate of $132,990 to us for payment on our behalf of offering
      expenses. These
      loans were repaid following our initial public offering from the proceeds of
      the
      offering.




27




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




None.




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





This
      information appears following Item 15 of this Report and is incorporated herein
      by reference.




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




None.




**ITEM
      9A. CONTROL AND PROCEDURES**




**Evaluation
      of Disclosure Controls and Procedures**




We
      have
      established disclosure controls and procedures to ensure that material
      information relating to us is made known to the officers who certify our
      financial reports and to other members of senior management and the Board of
      Directors.




Based
      on
      his evaluation as of December 31, 2007, our Principal Executive and Principal
      Financial and Accounting Officer has concluded that our disclosure controls
      and
      procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
      Exchange Act of 1934) are effective.




**Management's
      Report on Internal Control Over Financial Reporting**




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




**Changes
      in Internal Control Over Financial Reporting**




For
      the
      three month period covered by this report, there has been no change in our
      internal control over financial reporting that has materially affected, or
      is
      reasonably likely to materially affect, our internal control over financial
      reporting.





**Limitations
      on the effectiveness of controls**





A
      control
      system, no matter how well conceived and operated, can provide only reasonable,
      not absolute, assurance that the objectives of the control system are met.
      Because of the inherent limitations in all control systems, no evaluation of
      controls can provide absolute assurance that all control issues and instances
      of
      fraud, if any, within a company have been detected. Our disclosure controls
      and
      procedures are designed to provide reasonable assurance of achieving its
      objectives.





**ITEM
      9B. OTHER INFORMATION**





None.





**PART
      III**





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





**Directors
      and Executive Officers**




Our
      current directors and executive officers are as follows:




Name
            
            Age
            
            PositionLawrence
                S. Coben
            
            49
            
            Chairman
                of the Board and Chief Executive OfficerRonald
                D. Ormand
            
            49
            
            President,
                Chief Financial Officer and DirectorStephen
                N. Casati
            
            53
            
            DirectorJon
                Schotz
            
            52
            
            DirectorCharles
                A. Norris
            
            60
            
            Director




28




***Lawrence
      S. Coben*** has been
      our chairman of the board and chief executive officer since our inception and
      served as our chief financial officer from our inception until September 2007.
      Since May 2006, Mr. Coben has been an independent consultant. From May 2004
      to
      May 2006, Lawrence S. Coben served as chairman of the board and chief executive
      officer of Tremisis Energy Acquisition Corporation, a blank check company formed
      to effect a merger, capital stock exchange, asset acquisition or other similar
      business combination with an operating business in either the energy or the
      environmental industry and their related infrastructures. From January 2001
      until December 2003, Mr. Coben served as senior principal of Sunrise Capital
      Partners L.P., a private equity firm established by Houlihan Lokey Howard &
Zukin, an international investment banking firm that invests capital in middle
      market companies. From January 1997 to December 2000, Mr. Coben was an
      independent consultant. From October 1994 to December 1996, Mr. Coben was chief
      executive officer of Bolivian Power Company, Ltd., a New York Stock
      Exchange-listed company that was one of Bolivia’s largest private electric
      generator and distributor until its sale to an American-Swedish utility
      consortium. He was also a managing director of Liberty Power Latin America,
      L.P., a private developer and owner of power facilities, from January 1993
      to
      December 1996. He has served as a director of Prisma Energy, one of the
      successor Enron companies, since September 2003. Mr. Coben has also been a
      director of NRG Energy, Inc. since December 2003, when he was appointed in
      connection with its plan of reorganization following its emergence from Chapter
      11 bankruptcy. Mr. Coben is a member of the board of directors of the
      Bolivian-American Chamber of Commerce and was the co-chairman of the Lieberman
      2004 National Energy Policy Committee which has devised a plan (the Declaration
      of Energy Independence) to reduce American dependence on politically unstable
      sources of energy. Mr. Coben is also an archaeologist affiliated with the
      University of Pennsylvania and is completing a doctorate in Anthropology. Mr.
      Coben received a B.A. in economics from Yale University, an M.A. in Anthropology
      (Archaeology) from the University of Pennsylvania and a J.D. from Harvard School
      of Law.





***Ronald
      D. Ormand*** has
      served as a member of our board of directors since September 2007 and as our
      president and chief financial officer since November 2007. Mr. Ormand has over
      twenty five years of investment and commercial banking experience in the energy
      industry. From April 2005 to October 2007, he served as a managing director with
      West LB, a German-based international bank with over $300 billion in assets,
      where he covered the energy industry and served as head of the oil and gas
      investment banking group for the Americas. From 1988 until December 2004, Mr.
      Ormand was with CIBC World Markets and Oppenheimer & Co., which CIBC
      acquired in 1997. From 1997 to 2004, Mr. Ormand served as head of CIBC World
      Markets’ U.S. oil and gas investment banking group. Prior to joining CIBC World
      Markets in 1988, Mr. Ormand worked in various investment banking positions
      with
      Bateman Eichler, Hill Richards Incorporated, and L.F. Rothschild & Co., and
      as a research analyst covering the exploration and production sector at Rauscher
      Pierce Refsnes, Inc. Mr. Ormand received a B.A. and an M.B.A. from the
      University of California at Los Angeles and attended Cambridge University in
      Cambridge, England where he studied Economics.





***Stephen
      N. Casati*** has
      served as a member of our board of directors since our inception. Mr. Casati
      has
      served as the managing partner of Chicago Capital Management LLC, a partnership
      focused on opportunities in Greater China which leverage Mr. Casati’s 15 years
      of experience doing business in the region, since 1992. Mr. Casati has also
      served as a principal of Dearborn Capital Brokers Ltd., which provides commodity
      advisory and brokerage services to some of the larges commodity trading
      companies in the People’s Republic of China, since December 2005. From 1999 to
      April 2002, Mr. Casati was co-founder of AIA Everlasting Systems, a pioneering
      Chinese enterprise in the offshore software services industry. His partner
      in
      this company was American International Assurance, the Asian affiliate of
      American International Group. In 2003, AIA purchased 100% of the firm. He also
      is co-founder and board advisor to Pearl-in-Palm Technology Ltd., a Beijing
      based wireless services provider and leading creator of wireless entertainment
      in the People’s Republic of China. Since 1989, Mr. Casati has assisted in
      raising significant assets for several leading alternative investment managers
      including Dearborn Capital Management LLC, Crabel Capital Management LLC, BGK
      Group and Saybrook Capital LLC. Mr. Casati received a B.A. from Northwestern
      University.




29





***Jon
      Schotz*** has been
      a member of our board of directors since our inception. Mr. Schotz has been
      a
      partner of Saybrook Capital, LLC, a private investment bank engaged in capital
      management and financial advisory services, since he co-founded it in February
      1990 and has managed the Saybrook Tax-Exempt Opportunity Funds since May 1999.
      Mr. Schotz also helps manage the investments of Saybrook's proprietary capital
      as well as the investments of the Saybrook Fund. Prior to co-founding Saybrook,
      Mr. Schotz was involved in opening the Los Angeles office of Ehrlich Bober
&
Co., Inc., a public finance investment bank, in 1983. Mr. Schotz is also a
      director of Saybrook Capital Corp. Mr. Schotz was also a member of the board
      of
      directors of Tremisis Energy Acquisition Corporation from its inception until
      its acquisition of RAM Energy. Mr. Schotz received a B.A. and a Master of Public
      and Private Management degree from Yale University.





***Charles
      A. Norris*** has
      served as a member of our board of directors since our inception. Mr. Norris
      has
      served as the chairman of the board of Glacier Water Services, Inc., a provider
      of high quality, low priced drinking water dispensed to consumers through
      self-service vending machines, since June 2001. From October 2000 to June 2001,
      Mr. Norris managed his personal investments. From 1990 until October 2000,
      Mr.
      Norris served as president of McKesson Water Products Company, a bottled water
      company, and an officer of McKesson Corporation. Mr. Norris has served as a
      director of The Sports Club Company, Inc., an operator of several sports and
      fitness clubs, since 2004. Mr. Norris received a B.A. from the University of
      Rochester and an M.B.A. from Northeastern University.





Our
      board
      of directors is divided into three classes with only one class of directors
      being elected in each year and each class serving a three-year term. The term
      of
      office of the first class of directors, consisting of Stephen N. Casati, will
      expire at our first annual meeting of stockholders. The term of office of the
      second class of directors, consisting of Charles A. Norris and Ronald D. Ormand,
      will expire at the second annual meeting. The term of the third class of
      directors, consisting of Lawrence S. Coben and Jon Schotz, will expire at the
      third annual meeting.




**Section
      16(a) Beneficial Ownership Reporting Compliance**




Section
      16(a) of the Securities Exchange Act of 1934 requires our officers, directors
      and persons who own more than ten percent of a registered class of our equity
      securities to file reports of ownership and changes in ownership with the
      Securities and Exchange Commission. Officers, directors and ten percent
      stockholders are required by regulation to furnish us with copies of all Section
      16(a) forms they file. Based solely on copies of such forms received or written
      representations from certain reporting persons that no Form 5s were required
      for
      those persons, we believe that, during the fiscal year ended December 31, 2007,
      all filing requirements applicable to our officers, directors and greater than
      ten percent beneficial owners were complied with.





**Code
      of Ethics**





In
      December 2007, our board of directors adopted a code of ethics that applies
      to
      our directors, officers and employees as well as those of our subsidiaries.
      Requests for copies of our code of ethics should be sent in writing to Tremisis
      Energy Acquisition Corporation II, 11622 Monica Street, Houston, Texas
      77024.




30




**Corporate
      Governance**





*Nominating
      Committee*





Effective December
      2007 ,
      we
      established a nominating committee of the board of directors, which consists
      of
      Jon Schotz, as chairman, and Charles A. Norris, each of whom is an independent
      director under the American Stock Exchange’s listing standards. The nominating
      committee is responsible for overseeing the selection of persons to be nominated
      to serve on our board of directors. The nominating committee considers persons
      identified by its members, management, stockholders and others.





*Guidelines
      for Selecting Director Nominees*





The
      guidelines for selecting nominees, which are specified in the Nominating
      Committee Charter, generally provide that the Nominating Committee will consider
      and evaluate based on, among other factors, the following:





·
            The
                candidate’s independence under the rules of the American Stock
                Exchange;





·
            The
                candidate’s accomplishments and reputations, both personal and
                professional;





·
            The
                candidate’s relevant experience and
                expertise;





·
            The
                candidate’s knowledge of the company and issues affecting
                us;





·
            The
                candidate’s moral and ethical character;
                and





·
            The
                candidate’s ability to commit the required time necessary to discharge the
                duties of board membership.





The
      Nominating Committee will consider a number of qualifications relating to
      management and leadership experience, background and integrity and
      professionalism in evaluating a person’s candidacy for membership on the board
      of directors. The nominating committee may require certain skills or attributes,
      such as financial or accounting experience, to meet specific board needs that
      arise from time to time. The nominating committee does not distinguish among
      nominees recommended by shareholders and other persons.





There
      have been no material changes to the procedures by which security holders may
      recommend nominees to our board of directors.





*Audit
      Committee*





Effective December
      2007 ,
      we
      established an audit committee of the board of directors, which consists of
      Stephen N. Casati, as chairman, Jon Schotz and Charles A. Norris, each of whom
      is an independent director under the American Stock Exchange’s listing
      standards. The audit committee’s duties, which are specified in our Audit
      Committee Charter, include, but are not limited to:





·
            reviewing
                and discussing with management and the independent auditor the annual
                audited financial statements, and recommending to the board whether
                the
                audited financial statements should be included in our Form
                10-K;




31


·
            discussing
                with management and the independent auditor significant financial
                reporting issues and judgments made in connection with the preparation
                of
                our financial statements;





·
            discussing
                with management major risk assessment and risk management
                policies;





·
            monitoring
                the independence of the independent
                auditor;





·
            verifying
                the rotation of the audit partners having primary responsibility
                for the
                audit and the audit partner responsible for reviewing the audit as
                required by law;





·
            reviewing
                and approving all related-party
                transactions;





·
            inquiring
                and discussing with management our compliance with applicable laws
                and
                regulations;





·
            pre-approving
                all audit services and permitted non-audit services to be performed
                by our
                independent auditor, including the fees and terms of the services
                to be
                performed;





·
            appointing
                or replacing the independent
                auditor;





·
            determining
                the compensation and oversight of the work of the independent auditor
                (including resolution of disagreements between management and the
                independent auditor regarding financial reporting) for the purpose
                of
                preparing or issuing an audit report or related work;
                and





·
            establishing
                procedures for the receipt, retention and treatment of complaints
                received
                by us regarding accounting, internal accounting controls or reports
                which
                raise material issues regarding our financial statements or accounting
                policies.





*Financial
      Experts on Audit Committee*





The
      audit
      committee will at all times be composed exclusively of “independent directors”
who are “financially literate” as defined under the American Stock Exchange
      listing standards. The American Stock Exchange listing standards define
“financially literate” as being able to read and understand fundamental
      financial statements, including a company’s balance sheet, income statement and
      cash flow statement.





In
      addition, we must certify to the American Stock Exchange that the committee
      has,
      and will continue to have, at least one member who has past employment
      experience in finance or accounting, requisite professional certification in
      accounting, or other comparable experience or background that results in the
      individual’s financial sophistication. The board of directors has determined
      that Stephen N. Casati satisfies the American Stock Exchange’s definition of
      financial sophistication and also qualifies as an “audit committee financial
      expert,” as defined under rules and regulations of the SEC.




**ITEM
      11. EXECUTIVE COMPENSATION**




No
      executive officer has received any cash compensation for services rendered
      to
      us. No compensation of any kind, including finders, consulting or other similar
      fees, will be paid to any of our existing stockholders, including our directors,
      or any of their respective affiliates, prior to, or for any services they render
      in order to effectuate, the consummation of a business combination. However,
      such 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.




32




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




**Compensation
      Discussion and Analysis**




Overall,
      following our initial business combination, we will seek to provide total
      compensation packages that are competitive in terms of potential value to our
      executives, and which are tailored to the unique characteristics and needs
      of
      our company within our industry in order to create an executive compensation
      program that will adequately reward our executives for their roles in creating
      value for our shareholders. We intend to be competitive with other similarly
      situated companies in our industry following completion of our initial business
      combination. The compensation decisions regarding our executives will be based
      on our need to attract individuals with the skills necessary for us to achieve
      our business plan, to reward those individuals fairly over time, and to retain
      those individuals who continue to perform at or above our expectations.




It
      is
      likely that our executives’ compensation will have three primary components -
      salary, cash incentive bonus and stock-based awards. We will view the three
      components of executive compensation as related but distinct. We do not believe
      that significant compensation derived from one component of compensation should
      negate or reduce compensation from other components. We anticipate determining
      the appropriate level for each compensation component based in part, but not
      exclusively, on our view of internal equity and consistency, individual
      performance and other information deemed relevant and timely. We have not
      adopted any formal or informal policies or guidelines for allocating
      compensation between long-term and currently paid out compensation, between
      cash
      and non-cash compensation, or among different forms of compensation.




We
      may
      utilize the services of third parties from time to time in connection with
      the
      hiring and compensation awarded to executive employees. This could include
      subscriptions to executive compensation surveys and other databases.




**Benchmarking
      of Cash and Equity Compensation**




We
      believe it is important when making compensation-related decisions to be
      informed as to current practices of similarly situated publicly held companies.
      We expect to stay apprised of the cash and equity compensation practices of
      publicly held companies in the industry we operate in following our initial
      business combination through the review of such companies’ public reports and
      through other resources. It is expected that any companies chosen for inclusion
      in any benchmarking group would have business characteristics comparable to
      our
      company, including revenues, financial growth metrics, stage of development,
      employee headcount and market capitalization. While benchmarking may not always
      be appropriate as a stand-alone tool for setting compensation due to the aspects
      of our post-acquisition business and objectives that may be unique to us, we
      generally believe that gathering this information will be an important part
      of
      our compensation-related decision-making process.




**Compensation
      Components**




*Base
      Salary* .
      Generally, we anticipate setting executive base salaries at levels comparable
      with those of executives in similar positions and with similar responsibilities
      at comparable companies. We will seek to maintain base salary amounts at or
      near
      the industry norms while avoiding paying amounts in excess of what we believe
      is
      necessary to motivate executives to meet corporate goals. It is anticipated
      base
      salaries will generally be reviewed annually, subject to terms of employment
      agreements, and that we will seek to adjust base salary amounts to realign
      such
      salaries with industry norms after taking into account individual
      responsibilities, performance and experience.




33




*Annual
      Bonuses.* **** We
      may
      design and utilize cash incentive bonuses for executives to focus them on
      achieving key operational and financial objectives within a yearly time horizon.
      We **** will
      structure cash incentive bonus compensation so that it is taxable to our
      employees at the time it becomes available to them. At this time, it is not
      anticipated that any executive officer’s annual cash compensation will exceed $1
      million, and we have accordingly not made any plans to qualify for any
      compensation deductions under Section 162(m) of the Internal Revenue Code.




*Equity
      Awards.* **** We
      may
      also use stock options and other stock-based awards to reward long-term
      performance. We believe that providing a meaningful portion of our executives’
total compensation package in stock options and other stock-based awards will
      align the incentives of our executives with the interests of our shareholders
      and with our long-term success.




**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
      common stock as of March 25, 2008 by:




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




·
            each
                of our officers and directors; and




·
            all
                our officers and directors as a
                group.




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




Name
                and Address of Beneficial Owner (1)
            
            Amount
                and Nature of BeneficialOwnership
            
            Percent
                ofClassBrian
                Taylor
            
            
            1,185,000
            (2)
            
            9.7
            %Fortress
                Investment Group LLC
            
            
            1,100,000
            (3)
            
            9.0
            %Bulldog
                Investors
            
            
            935,800
            (4)
            
            7.7
            %Lawrence
                S. Coben
            
            
            828,226
            (5)
            
            6.8
            %Ronald
                D. Ormand
            
            
            828,226
            (5)
            
            6.8
            %Jon
                Schotz (6)
            
            
            144,322
            (7)
            
            1.2
            %Charles
                A. Norris (8)
            
            
            144,322
            (7)
            
            1.2
            %Stephen
                N. Casati
            
            
            19,322
            
            
            *All
                directors and executive officers as a group (five
                individuals)
            
            
            1,964,418
            (9)
            
            16.2
            %







*
      Less
      than one percent.





34




(1)
            Unless
                otherwise indicated, the business address of each of the individuals
                is
                11622 Monica Street, Houston, Texas
                77024.




(2)
            Mr.
                Taylor, Pine River Capital Management L.P. (“Pine River”) and Nisswa
                Master Fund Ltd. (“Nisswa”) have shared power to vote and dispose of the
                shares of common stock. The business address of Mr. Taylor, Pine
                River and
                Nisswa is 601 Carlson Parkway, Suite 330, Minnetonka, MN 55305. The
                foregoing information was derived from a Schedule 13G filed with
                the
                Securities and Exchange Commission December 17,
                2007.




(3)
            Represents
                (i) 990,000 shares of common stock held by Drawbridge DSO Securities
                LLC
                (“DSO”) and (ii) 110,000 shares of common stock held by Drawbridge OSO
                Securities LLC (“OSO”). Drawbridge Special Opportunities Fund LP (“Fund
                LP”) is the sole managing member of DSO, Drawbridge Special Opportunities
                GP LLC (“GP”) is the general partner of Fund LP and Fortress Principal
                Investment Holdings IV LLP (“Holdings”) is the sole managing member of GP.
                Drawbridge Special Opportunities Fund Ltd. (“Fund Ltd.”) is the sole
                managing member of OSO, Drawbridge Special Opportunities Advisors
                LLC
                (“Advisors”) is the investment advisor for Fund LP and Fund Ltd., and FIG
                LLC (“FIG LLC”) is the sole managing member of Advisors. Fortress
                Operating Enitty I LP (“Operating”) is the sole managing member of
                Holdings and FIG LLC, FIG Corp. (“FIG Corp.”) is the general partner of
                Operating and Fortress Investment Group LLC (“Group”) is the beneficial
                owner of all securities beneficially owned by FIG Corp. The business
                address for all of the entities is c/o Fortress Investment Group
                LLC, 1345
                Avenue of the Americas, 46thFloor, New York, New York 10105, Attention: Michael Cohn. The foregoing
                information was derived from a Schedule 13G filed with the Securities
                and
                Exchange Commission February 14,
                2008.




(4)
            Phillip
                Goldstein and Andrew Dakos are principals of Bulldog Investors. The
                business address of Bulldog Investors is Park 80 West, Plaza Two,
                Saddle
                Brook, New Jersey 07663. The foregoing information was derived from
                a
                Schedule 13G filed with the Securities and Exchange Commission January
                22,
                2008.




(5)
            Does
                not include 450,000 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




(6)
            Mr.
                Schotz’s business address is c/o Saybrook Capital, LLC, 401 Wilshire
                Boulevard, Suite 850, Santa Monica, California
                90401.




(7)
            Does
                not include 250,000 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




(8)
            Mr.
                Norris’ business address is 1385 Park Center Drive, Vista, California
                92081.




(9)
            Does
                not include 1,400,000 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




35




All
      of
      the founders’ shares have been placed in escrow with Continental Stock Transfer
& Trust Company, as escrow agent, until one year after the consummation of
      our initial business combination. The founders’ shares may be released from
      escrow earlier than this date if, within the first year after we consummate
      an
      initial business combination, we consummate a subsequent liquidation, merger,
      stock exchange or other similar transaction which results in all of our
      stockholders having the right to exchange their shares of common stock for
      cash,
      securities or other property. Additionally, if holders of more than 20% of
      the
      IPO shares vote against a proposed business combination and seek to exercise
      their conversion rights and such business combination is consummated, our
      founders have agreed to forfeit and return to us for cancellation a number
      of
      shares so that the founders will collectively own no more than 23.8% of our
      outstanding common stock upon consummation of such business combination (without
      giving effect to any shares that may be issued in the business combination).
      During the escrow period, the holders of these shares will not be able to sell
      or transfer their securities except (i) to an entity’s members upon its
      liquidation, (ii) to relatives and trusts for estate planning purposes or (iii)
      by private sales made at or prior to the consummation of a business combination
      at prices no greater than the price at which the shares were originally
      purchased, in each case where the transferee agrees to the terms of the escrow
      agreement, but will retain all other rights as our stockholders, including,
      without limitation, the right to vote their shares of common stock and the
      right
      to receive cash dividends, if declared. If dividends are declared and payable
      in
      shares of common stock, such dividends will also be placed in escrow. If we
      are
      unable to effect a business combination and liquidate, none of our founders
      will
      receive any portion of the liquidation proceeds with respect to their initial
      shares.




Certain
      of our officers, directors and initial stockholders purchased the sponsors’
warrants (for a total purchase price of $2,650,000) from us. These purchases
      took place on a private placement basis simultaneously with the consummation
      of
      our IPO. The sponsors’ warrants are identical to the warrants underlying the
      units offered in our IPO except that if we call the warrants for redemption,
      the
      sponsors’ warrants will be exercisable on a cashless basis so long as such
      warrants are held by the purchasers or their affiliates. The purchasers have
      agreed that the sponsors’ warrants will not be sold or transferred by them until
      after we have completed a business combination.




Lawrence
      S. Coben and Ronald D. Ormand are our “promoters” as that term is defined under
      the federal securities laws.




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




In
      July
      2007, we issued 2,731,250 shares of founders’ common stock to the individuals
      set forth below for an aggregate of $25,000 in cash, at a purchase price of
      approximately $0.009 per share, as follows:




Stockholders
            
            Number
                of Shares
            
            Relationship
                to UsLawrence
                S. Coben
            
            
            2,406,250
            
            
            Chairman
                of the Board and Chief Executive OfficerJon
                Schotz
            
            
            150,000
            
            
            DirectorCharles
                A. Norris
            
            
            150,000
            
            
            DirectorStephen
                N. Casati
            
            
            25,000
            
            
            Director





In
      September 2007, Lawrence S. Cohen transferred 1,203,125 shares of common stock
      to Ronald D. Ormand, our president, chief financial officer and member of our
      board of directors, for approximately $0.009 per share. In October 2007, Messrs.
      Coben and Ormand transferred an aggregate of 281,250 shares of common stock
      to
      (i) Bill Armstrong (42,185 shares of common stock), (ii) Dean Vanech (37,500
      shares of common stock), (iii) Jerry Doren, Owen Coleman, Bill Goldstein and
      Trevor Wilson (each 28,125 shares of common stock), (iv) David A. Preiser
      (18,750 shares of common shares) and (v) Brian McInerny, Richard Kassar, David
      Levine, Jim Land and Dr. John Jacobs (each 14,063 shares of common stock),
      all
      for approximately $0.009 per share. In November 2007, Messrs. Coben and Ormand
      transferred an aggregate of 187,500 shares of common stock to Gary Evans for
      approximately $0.009 per share.




36





On
      January 24, 2008, we consummated the offering of 232,669 units that were subject
      to the over-allotment option granted to the underwriters in our initial public
      offering. The remainder of the underwriters’ over-allotment option expired
      unexercised. As only a portion of the over-allotment option was exercised,
      the
      following founders’ shares were canceled:





Name
                of Holder
            
            Number
                of SharesLawrence
                S. Coben
            
            
            140,524Ronald
                D. Ormand
            
            
            140,524Jon
                Schotz
            
            
            5,678Charles
                A. Norris
            
            
            5,678Stephen
                N. Casati
            
            
            5,678





The
      following table reflects the current ownership of our founders shares,
      accounting for the aforementioned transactions:





Name
            
            Number
                of Shares
            
            Relationship
                to UsLawrence
                S. Coben
            
            
            828,226
            
            
            Chairman
                of the Board and Chief Executive OfficerRonald
                D. Ormand
            
            
            828,226
            
            
            President,
                Chief Financial Officer and DirectorJon
                Schotz
            
            
            144,322
            
            
            DirectorCharles
                A. Norris
            
            
            144,322
            
            
            DirectorStephen
                N. Casati
            
            
            19,322
            
            
            DirectorBill
                Armstrong
            
            
            42,185
            
            
            StockholderDean
                Vanech
            
            
            37,500
            
            
            StockholderJerry
                Doren
            
            
            28,125
            
            
            StockholderOwen
                Coleman
            
            
            28,125
            
            
            StockholderBill
                Goldstein
            
            
            28,125
            
            
            StockholderTrevor
                Wilson
            
            
            28,125
            
            
            StockholderDavid
                A. Preiser
            
            
            18,750
            
            
            StockholderBrian
                McInery
            
            
            14,063
            
            
            StockholderRichard
                Kassar
            
            
            14,063
            
            
            StockholderDavid
                Levine
            
            
            14,063
            
            
            StockholderJim
                Land
            
            
            14,063
            
            
            StockholderDr.
                John Jacobs
            
            
            14,063
            
            
            StockholderGary
                Evans
            
            
            187,500
            
            
            Stockholder





All
      of
      the founders shares have been placed in escrow with Continental Stock Transfer
      & Trust Company, as escrow agent, until one year after the consummation of a
      business combination. The founders’ shares may be released from escrow earlier
      than this date if, within the first year after we consummate a business
      combination, we consummate a subsequent liquidation, merger, stock exchange
      or
      other similar transaction which results in all of our stockholders having the
      right to exchange their shares of common stock for cash, securities or other
      property. Additionally, if holders of more than 20% of the IPO shares vote
      against a proposed business combination and seek to exercise their conversion
      rights and such business combination is consummated, our founders have agreed
      to
      forfeit and return to us for cancellation a number of shares so that the
      founders will collectively own no more than 23.8% of our outstanding common
      stock upon consummation of such business combination (without giving effect
      to
      any shares that may be issued in the business combination). The holders of
      a
      majority of the founders’ shares will be entitled to make up to two demands that
      we register these shares pursuant to a registration rights agreement. The
      holders of a majority of the founders’ shares may elect to exercise these
      registration rights at any time commencing nine months after the consummation
      of
      a business combination. In addition, the founders have certain “piggy-back”
registration rights allowing them to include their shares in registration
      statements filed with respect to offerings by us subsequent to the date on
      which
      these shares of common stock are released from escrow. We will bear the expenses
      incurred in connection with the filing of any such registration
      statements.




37





Certain
      of our founders purchased 2,650,000 sponsors’ warrants (for a total purchase
      price of $2,650,000) from us. These purchases took place on a private placement
      basis simultaneously with the consummation of our IPO. The sponsors’ warrants
      are identical to the warrants underlying the units offered in our IPO except
      that if we call the warrants for redemption, the sponsors’ warrants will be
      exercisable on a cashless basis so long as such warrants are held by the
      purchasers or their affiliates. The purchasers have agreed that the sponsors’
warrants will not be sold or transferred by them until after we have completed
      a
      business combination. The holders of the majority of these sponsors’ warrants
      (or underlying shares) will be entitled to demand that we register these
      securities pursuant to a registration rights agreement. The holders of the
      majority of these securities may elect to exercise these registration rights
      with respect to such securities at any time after we consummate a business
      combination. In addition, these holders have certain “piggy-back” registration
      rights with respect to registration statements filed subsequent to such date.
      We
      will bear the expenses incurred in connection with the filing of any such
      registration statements.





Prior
      to
      our IPO, Lawrence S. Coben and Ronald D. Ormand advanced to us an aggregate
      of
      $132,990 ($50,000 on July 27, 2007 and $82,990 on August 22, 2007) to cover
      expenses related to our IPO. The loans were repaid without interest upon the
      consummation of our IPO from the proceeds of the IPO not placed in
      trust.





We
      will
      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 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 reimbursable out-of-pocket expenses payable to our officers and directors,
      no compensation or fees of any kind, including finder’s fees, consulting fees or
      other similar compensation, will be paid to any of our stockholders, officers
      or
      directors who owned our common stock prior to our IPO, or to any of their
      respective affiliates, prior to or with respect to the business combination
      (regardless of the type of transaction that it is).





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 to us than are available
      from unaffiliated third parties. Such transactions or loans, including any
      forgiveness of loans, will require prior approval 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.




38





**Related
      party policy**





Our
      Code
      of Ethics requires us to avoid, wherever possible, all related party
      transactions that could result in actual or potential conflicts of interest,
      except under guidelines approved by the board of directors (or the audit
      committee). Related-party transactions are defined under SEC rules as
      transactions in which (1) the aggregate amount involved will or may be expected
      to exceed $120,000 in any calendar year, (2) we or any of our subsidiaries
      is a
      participant, and (3) any (a) executive officer, director or nominee for election
      as a director, (b) greater than 5 percent beneficial owner of our common stock,
      or (c) immediate family member, of the persons referred to in clauses (a) and
      (b), has or will have a direct or indirect material interest (other than solely
      as a result of being a director or a less than 10 percent beneficial owner
      of
      another entity). A conflict of interest situation can arise when a person takes
      actions or has interests that may make it difficult to perform his or her work
      objectively and effectively. Conflicts of interest may also arise if a person,
      or a member of his or her family, receives improper personal benefits as a
      result of his or her position.





Our
      audit
      committee, pursuant to its written charter, is responsible for reviewing and
      approving related-party transactions to the extent we enter into such
      transactions. The audit committee will consider all relevant factors when
      determining whether to approve a related party transaction, including whether
      the related party transaction is on terms no less favorable than terms generally
      available to an unaffiliated third party under the same or similar circumstances
      and the extent of the related party’s interest in the transaction. No director
      may participate in the approval of any transaction in which he is a related
      party, but that director is required to provide the audit committee with all
      material information concerning the transaction. Additionally, we require each
      of our directors and executive officers to complete a directors’ and officers’
questionnaire on an annual basis that elicits information about related party
      transactions.





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





These
      procedures are intended to determine whether any such related party transaction
      impairs the independence of a director or presents a conflict of interest on
      the
      part of a director, employee or officer.





**Director
      Independence**





The
      American Stock Exchange requires that a majority of our board must be composed
      of “independent directors,” which is defined generally as a person other than an
      officer or employee of the company or its subsidiaries or any other individual
      having a relationship, which, in the opinion of the company’s board of directors
      would interfere with the director’s exercise of independent judgment in carrying
      out the responsibilities of a director.





Stephen
      N. Casati, Jon Schotz and Charles A. Norris are our independent directors,
      constituting a majority of our board. Our independent directors will have
      regularly scheduled meetings at which only independent directors are
      present.




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




The
      firm
      of BDO Seidman, LLP acts as our independent registered public accounting firm.
      The following is a summary of fees incurred to BDO Seidman, LLP for services
      rendered.




39




**Audit
      Fees**




During
      the period ended December 31, 2007, audit fees for our independent registered
      public accounting firm were $68,690 for the services they performed in
      connection with our initial public offering, including the audit of the
      financial statements included in the Registration Statement on Form S-1 and
      in
      the Form 8-K filed with the Securities and Exchange Commission on December
      18,
      2007; $7,820 for the services they performed in connection with our Quarterly
      Report on Form 10-Q for September 30, 2007 and an estimate of $18,000 for the
      audit of our financial statements as of December 31, 2007.




**Audit-Related
      Fees**




During
      2007, our independent registered public accounting firm did not render any
      audit
      related services.




**Tax
      Fees**




During
      2007, our independent registered public accounting firm did not render any
      services to us for tax compliance, tax advice and tax planning.




**All
      Other Fees**




During
      2007, there were no fees billed for products and services provided by our
      independent registered public accounting firm other than those set forth
      above.




**Audit
      Committee Approval**




Since
      our
      audit committee was not formed until December 2007, the audit committee did
      not
      pre-approve all of the foregoing services although any services rendered prior
      to the formation of our audit committee were approved by our board of directors.
      However, in accordance with Section 10A(i) of the Securities Exchange Act of
      1934, before we engage our independent accountant to render audit or non-audit
      services on a going-forward basis, the engagement will be approved by our audit
      committee.




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





(a)
      The
      following Exhibits are filed as part of this report.


Exhibit
                  No.
              
              Description3.1
              
              Amended
                  and Restated Certificate of Incorporation. (1)3.2
              
              By-laws.
                  (1)4.1
              
              Specimen
                  Unit Certificate. (1)4.2
              
              Specimen
                  Common Stock Certificate. (1)4.3
              
              Specimen
                  Warrant Certificate. (1)
  40
  4.4
              
              Form
                  of Warrant Agreement between Continental Stock Transfer & Trust
                  Company and the Registrant. (1)10.1
              
              Letter
                  Agreement among the Registrant, Merrill Lynch, Pierce, Fenner & Smith
                  Incorporated, EarlyBirdCapital, Inc. and Lawrence S. Coben.
                  (1)10.2
              
              Letter
                  Agreement among the Registrant, Merrill Lynch, Pierce, Fenner & Smith
                  Incorporated, EarlyBirdCapital, Inc. and Jon Schotz.
                  (1)10.3
              
              Letter
                  Agreement among the Registrant, Merrill Lynch, Pierce, Fenner & Smith
                  Incorporated, EarlyBirdCapital, Inc. and Charles A. Norris.
                  (1)10.4
              
              Letter
                  Agreement among the Registrant, Merrill Lynch, Pierce, Fenner & Smith
                  Incorporated, EarlyBirdCapital, Inc. and Stephen N. Casati.
                  (1)10.5
              
              Form
                  of Investment Management Trust Agreement between Continental Stock
                  Transfer & Trust Company and the Registrant. (1)10.6
              
              Form
                  of Stock Escrow Agreement between the Registrant, Continental Stock
                  Transfer & Trust Company and the Founders. (1)10.7
              
              Promissory
                  Note issued to Lawrence S. Coben. (1)10.8
              
              Form
                  of Registration Rights Agreement among the Registrant and the Founders.
                  (1)10.9
              
              Form
                  of Subscription Agreements among the Registrant, Graubard Miller
                  and each
                  of Lawrence S. Coben, Ronald D. Ormand, Jon Schotz, Charles A.
                  Norris,
                  Bill Goldstein, Dean Vanech, Jerry Doren, Owen Coleman, Bill Armstrong,
                  Trevor Wilson, Brian McInerny, Richard Kassar, David Levine, Jim
                  Land,
                  David A. Preiser, Gary Evans and Dr. John Jacobs. (1)10.10
              
              Letter
                  Agreement among the Registrant, Merrill Lynch, Pierce Fenner & Smith
                  Incorporated, EarlyBirdCapital, Inc. and Ronald D. Ormand.
                  (1)10.11
              
              Form
                  of Letter Agreement among the Registrant, Merrill Lynch, Pierce,
                  Fenner
                  & Smith Incorporated, EarlyBirdCapital, Inc. and each of Bill
                  Goldstein, Dean Vanech, Jerry Doren, Owen Coleman, Bill Armstrong,
                  Trevor
                  Wilson, Brian McInerny, Richard Kassar, David Levine, Jim Land,
                  David A.
                  Preiser, Gary Evans and Dr. John Jacobs. (1)31.1
              
              Certification
                  of Principal Executive Officer pursuant to Section 302 of the
                  Sarbanes-Oxley Act of 2002.31.2
              
              Certification
                  of Principal Financial and Accounting Officer pursuant to Section
                  302 of
                  the Sarbanes-Oxley Act of 2002.32
              
              Certification
                  of Principal Executive Officer and Principal Financial and Accounting
                  Officer pursuant to Section 906 of the Sarbanes-Oxley Act of
                  2002.99.1
              
              Audit
                  Committee charter. (1)99.2
              
              Nominating
                  Committee charter. (1)


(1)
            Incorporated
                by reference to the Registrant’s Registration Statement on Form S-1 (SEC
                File No. 333-145625).




41


**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**





**Index
      to Financial Statements**


Report
                  of Independent Registered Public Accounting Firm
              
              
              43Financial
                  statementsBalance
                  sheet
              
              
              44Statement
                  of Operations
              
              
              45Statement
                  of Stockholders’ Equity
              
              
              46Statement
                  of Cash Flows
              
              
              47Notes
                  to Financial Statements
              
              
              48 to
                  55
  42


REPORT
      OF
      INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To
      the
      Board of Directors and Stockholders


Tremisis
      Energy Acquisition Corporation II


Houston,
      Texas





We
      have
      audited the accompanying balance sheet of Tremisis Energy Acquisition
      Corporation II (a corporation in the development stage, the “Company”) as of
      December 31, 2007, and the related statements of operations, stockholders’
equity and cash flows for the period from July 3, 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 Tremisis Energy Acquisition
      Corporation II as of December 31, 2007, and the results of its operations and
      its cash flows for the period from July 3, 2007 (inception) to December 31,
      2007
      in conformity with accounting principles generally accepted in the United States
      of America.







/s/
      BDO
      Seidman, LLP





BDO
      Seidman, LLP


New
      York,
      NY


March
      25,
      2008





43





TREMISIS
                ENERGY ACQUISITION CORPORATION II(a
                corporation in the development stage)BALANCE
                SHEETDECEMBER
                31, 2007




ASSETSCurrent
                assets:Cash
            
            $
            101,836Cash
                equivalents held in trust (Note 1)
            
            
            75,595,000Interest
                receivable on cash equivalents held in trust
            
            
            152,990Prepaid
                expenses
            
            
            90,786Total
                current assets
            
            
            75,940,612Total
                assets
            
            $
            75,940,612LIABILITIES
                AND STOCKHOLDERS' EQUITYCurrent
                liabilities:Accrued
                registration costs
            
            $
            12,880Accrued
                expenses
            
            
            7,763Income
                and franchise taxes payable
            
            
            51,054Deferred
                underwriting fee (Note 3)
            
            
            3,040,000Total
                current liabilities
            
            
            3,111,697Common
                stock subject to possible conversion (2,849,050 sharesat
                conversion value) (Note 1)
            
            
            22,716,822Commitments
                (Note 6)STOCKHOLDERS'
                EQUITY: (Note 7)Common
                stock, $.0001 par value per share,authorized
                35,000,000 shares,issued
                and outstanding 9,382,200(excluding
                2,849,050 shares subject to conversion)
            
            
            938Additional
                paid in capital
            
            
            50,034,535Retained
                earnings accumulated during the development stage
            
            
            76,620Total
                stockholders' equity
            
            
            50,112,093Total
                liabilities and stockholders' equity
            
            $
            75,940,612




See
      notes
      to financial statements




44




TREMISIS
                ENERGY ACQUISITION CORPORATION II(a
                corporation in the development stage)STATEMENT
                OF OPERATIONS




For
                the periodfrom
                July 3, 2007(inception)
                toDecember
                31, 2007Interest
                income
            
            $
            152,990Expenses:Franchise
                tax (Note 5)
            
            
            26,054General
                and administrative
            
            
            16,452Formation
                costs
            
            
            5,650Insurance
            
            
            3,214Total
                expenses
            
            
            51,370Net
                income before taxes
            
            
            101,620Provision
                for income taxes (Note 5)
            
            
            25,000Net
                income for the period
            
            
            76,620Accretion
                of trust account relating to commonstock
                subject to possible conversion
            
            
            (45,882
            )Net
                income attributable to common stockholders
            
            $
            30,738Weighted
                average number of shares outstanding -basic
                and diluted
            
            
            3,462,124Net
                income per share, basic and diluted
            
            $
            0.01Number
                of shares outstanding subject to possibleconversion
                - basic and diluted
            
            
            2,849,050Net
                income per share subject to possible conversion - basic and
                diluted
            
            $
            0.02





See
      notes
      to financial statements




45





TREMISIS
                ENERGY ACQUISITION CORPORATION II(a
                corporation in the development stage)STATEMENT
                OF STOCKHOLDERS' EQUITYFOR
                THE PERIOD FROM JULY 3, 2007 (inception) TO DECEMBER 31,
                2007




Common
                  Stock
              
              Additional
                paid-in
              
              Retained
                  earnings accumulated during the development
              
              Total
                  stockholders'Shares
              
              Amount
              
              capital
              
              stage
              
              equityIssuance
                  of common stock to initial stockholders
              
              
              2,731,250
              
              $
              273
              
              $
              24,727
              
              $
              -
              
              $
              25,000Proceeds
                  from sale of 9,500,000 units through public offering net of underwriter's
                  discount and offering expenses and excluding $22,670,940 allocable
                  to
                  2,849,050 shares of common stock subject to possible
                  conversion
              
              
              6,650,950
              
              
              665
              
              
              47,405,690
              
              
              -
              
              
              47,406,355Proceeds
                  from issuance of 2,650,000 warrants
              
              
              -
              
              
              -
              
              
              2,650,000
              
              
              -
              
              
              2,650,000Accretion
                  of trust account relating to common stock subject to possible
                  conversion
              
              
              -
              
              
              -
              
              
              (45,882
              )
              
              -
              
              
              (45,882
              )Net
                  income for the period
              
              
              -
              
              
              -
              
              
              -
              
              
              76,620
              
              
              76,620Balance
                  at December 31, 2007
              
              
              9,382,200
              
              $
              938
              
              $
              50,034,535
              
              $
              76,620
              
              $
              50,112,093




See
      notes
      to financial statements





46




TREMISIS
                ENERGY ACQUISITION CORPORATION II(a
                corporation in the development stage)STATEMENT
                OF CASH FLOWSFOR
                THE PERIOD FROM JULY 3, 2007 (inception) TO DECEMBER 31,
                2007




CASH
                FLOWS FROM OPERATING ACTIVITIESNet
                income
            
            $
            76,620Adjustments
                to reconcile net income to net cash used inoperating
                activities:Increase
                in interest receivable
            
            
            (152,990
            )Increase
                in prepaid expenses
            
            
            (90,786
            )Increase
                in accrued expenses
            
            
            7,763Increase
                in income and franchise taxes payable
            
            
            51,054Net
                cash used in operating activities
            
            
            ($108,339
            )CASH
                FLOW FROM INVESTING ACTIVITIESCash
                equivalents held in trust
            
            
            (75,595,000
            )Net
                cash used in investing activities
            
            
            (75,595,000
            )CASH
                FLOWS FROM FINANCING ACTIVITIESProceeds
                from issuance of shares of common stockto
                initial stockholders
            
            
            25,000Net
                proceeds from sale of units through public offering
            
            
            50,459,235Proceeds
                from issuance of insider warrants to initial stockholders
            
            
            2,650,000Portion
                of proceeds from sale of units through public offering allocable
                to sharesof
                common stock subject to possible conversion
            
            
            22,670,940Proceeds
                from notes payable, stockholders
            
            
            132,990Repayment
                of notes payable, stockholders
            
            
            (132,990
            )Net
                cash provided by financing activities
            
            
            75,805,175NET
                INCREASE IN CASH
            
            $
            101,836Cash
                at beginning of period
            
            
            -Cash
                at end of period
            
            $
            101,836Supplemental
                disclosure of non-cash financing activitiesDeferred
                underwriting fee
            
            $
            3,040,000Accrued
                registration costs
            
            
            12,880Accretion
                of trust account relating to common stock subject to possible
                conversion
            
            
            45,882





See
      notes
      to financial statements




47




**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**


**Notes
      to Financial Statements**





**NOTE
      1 - Organization and Business Operations**





Tremisis
      Energy Acquisition Corporation II was incorporated in Delaware on July 3, 2007
      for the purpose of effecting a merger, capital stock exchange, asset acquisition
      or other similar business combination with an operating business.





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





At
      December 31, 2007, the Company had not yet commenced any operations. All
      activity through December 31, 2007 relates to the Company’s formation and the
      public offering described below.





The
      registration statement for the Company's initial public offering ("Offering")
      was declared effective December 6, 2007. The Company consummated the Offering
      on
      December 12, 2007 and received net proceeds of approximately $76,000,000. The
      Company’s management has broad discretion with respect to the specific
      application of the net proceeds of this Offering, although substantially all
      of
      the net proceeds of this Offering are intended to be generally applied toward
      consummating a business combination with an operating business (“Business
      Combination”). Furthermore, there is no assurance that the Company will be able
      to successfully affect a Business Combination. Upon the closing of the Offering
      an aggregate of $75,595,000 including the $2,650,000 proceeds of the Private
      Placement described in Note 6 and the $3,040,000 of deferred underwriters
      discount described in Note 3, was placed in a trust account ("Trust Account")
      which is to be invested in United States "government securities" within the
      meaning of Section 2(a)(16) of the Investment Company Act of 1940 having a
      maturity of 180 days or less or in money market funds meeting certain conditions
      under Rule 2a-7 promulgated under the Investment Company Act of 1940 until
      the
      earlier of (i) the consummation of its first Business Combination and (ii)
      liquidation of the Company. The placing of funds in the Trust Account may not
      protect those funds from third party claims against the Company. Although the
      Company will seek to have all vendors and service providers (which would include
      any third parties engaged to assist the Company in any way in connection with
      the search for a target business) and prospective target businesses execute
      agreements with the Company waiving any right, title, interest or claim of
      any
      kind in or to any monies held in the Trust Account, there is no guarantee they
      will execute such agreements. Nor is there any guarantee that, even if such
      entities execute such agreements with the Company, they will not seek recourse
      against the trust account or that a court would not conclude that such
      agreements are not legally enforceable.





The
      Company's Chairman of the Board and the Company's Chief Executive Officer have
      agreed that they will be liable under certain circumstances to ensure that
      the
      proceeds in the Trust Account are not reduced for the claims of target
      businesses or claims of vendors or other entities that are owed money by the
      Company for services rendered or contracted for or products sold to the Company.
      However, there can be no assurance that they will be able to satisfy those
      obligations. Furthermore, they will not have any personal liability as to any
      claimed amounts owed to a third party who executed a waiver (including a
      prospective target business). Additionally, in the case of a prospective target
      business that did not execute a waiver, such liability will only be in an amount
      necessary to ensure that public stockholders receive no less than $7.77 per
      share upon liquidation. The remaining net proceeds (not held in the Trust
      Account) may be used to pay for business, legal and accounting due diligence
      on
      prospective acquisitions and continuing general and administrative expenses.
      Additionally, up to an aggregate of $1,200,000 of interest earned on the Trust
      Account balance may be released to the Company to fund working capital
      requirements and additional amounts may be released as necessary to satisfy
      tax
      obligations.




48





**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**


**Notes
      to Financial Statements**





The
      Company, after signing a definitive agreement for the acquisition of a target
      business, is required to submit such transaction for stockholders' approval.
      Stockholders that vote against such proposed Business Combination and exercise
      their conversion rights are, under certain conditions described below, entitled
      to convert their share into a pro-rata distribution from the Trust Account
      (the
      "Conversion Right"). The actual per share conversion price will be equal to
      the
      amount in the Trust Account (inclusive of any interest thereon), calculated
      as
      of two business days prior to the proposed Business Combination, divided by
      the
      number of shares sold in the Offering. As a result of the Conversion Right,
      $22,670,940 plus accretion of $45,882 aggregating $22,716,822 (representing
      29.99% cash and interest held in trust) has been classified as common stock,
      subject to possible conversion on the accompanying balance sheet as of December
      31, 2007. The Initial Stockholders have agreed to vote their 2,731,250 founding
      shares of common stock in accordance with the manner in which the majority
      of
      the shares of common stock offered in the Offering are voted by the Company's
      public stockholders ("Public Stockholders") with respect to a Business
      Combination.





In
      the
      event that a majority of the outstanding shares of common stock voted by the
      Public Stockholders vote for the approval of a Business Combination and holders
      owning 30% or more of the outstanding common stock do not vote against the
      Business Combination and do not exercise their Conversion Rights, the Business
      Combination may then be consummated.





The
      Company’s Amended and Restated Certificate of Incorporation provides that the
      Company will continue in existence up to 24 months from the Effective Date
      of
      the Offering. If the Company has not completed a Business Combination by such
      date, its corporate existence will cease and it will dissolve and liquidate
      for
      the purposes of winding up its affairs. In the event of liquidation, it is
      likely that the per share value of the residual assets remaining available
      for
      distribution (including Trust Fund assets) will be less than the initial public
      offering price per share in the Offering (assuming no value is attributed to
      the
      Warrants contained in the Units sold in the Offering).





49




**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**


**Notes
      to Financial Statements**





**NOTE
      2 - Summary of Significant Accounting Policies**





**Cash
      Equivalents -** The
      Company considers all highly liquid investments with original maturities of
      three months or less to be cash equivalents.





**Concentration
      of Credit Risk-** The
      Company maintains cash in a bank deposit account which, at times, exceeds
      federally insured (FDIC) limits. The Company has not experienced any losses
      on
      this account.





**Deferred
      Income Taxes-** Deferred
      income tax assets and liabilities are computed for differences between the
      financial statements and tax basis of assets and liabilities that will result
      in
      future taxable or deductible amounts and are based on enacted tax laws and
      rates
      applicable to the periods in which the differences are expected to effect
      taxable income. Valuation allowances are established when necessary to reduce
      deferred income tax assets to the amount expected to be realized. There were
      no
      deferred taxes at December 31, 2007.





**Net
      Income Per Share-** Basic
      net income per share excludes dilution and is computed by dividing income
      available to common stockholders by the weighted average common shares
      outstanding for the period. Calculation of the weighted average common shares
      outstanding during the period is based on 2,731,250 initial shares outstanding
      throughout the period from July 3 (inception) to December 31, 2007, and
      6,650,950 common shares (excluding 2,849,050 shares subject to possible
      conversion) issued at the completion of the Offering on December 12, 2007.
      Basic
      net income per share subject to possible conversion is calculated by dividing
      accretion of Trust Account relating to common stock subject to possible
      conversion by 2,849,050 common shares subject to possible conversion. Diluted
      earnings per share reflects the potential dilution that could occur if
      securities or other contracts to issue common stock were exercised or converted
      into common stock or resulted in the issuance of common stock that then shared
      in the earnings of the entity. The shares issuable upon exercise of the Warrants
      have been excluded from the calculation of diluted net income per share since
      the Warrants are exercisable commencing the later of one year or the completion
      of a Business Combination and this contingency has not been
      resolved.





**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 at the date of
      the
      financial statements and the reported amounts of expenses during the reporting
      period. Actual results could differ from those estimates.





50




**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**


**Notes
      to Financial Statements**





**New
      Accounting Pronouncements-** In July
      2006, the Financial Accounting Standards Board (“FASB”) issued Interpretation
      No. 48, Accounting For Uncertainty in Income Taxes, an interpretation of FASB
      Statement No. 109 ("FIN 48"). FIN 48 establishes new evaluation and measurement
      processes for all income tax positions taken. FIN 48 also requires expanded
      disclosure of income tax matters. The adoption of this standard for the period
      ended December 31, 2007, did not have a material effect on the Company's
      financial statements.





In
      September 2006, the FASB issued Statement No. 157, Fair Value Measurements
      ("SFAS No. 157"). SFAS No. 157 provides guidance for using fair value to measure
      assets and liabilities. This statement clarifies the principle that fair value
      should be based on the assumptions that market participants would use when
      pricing the asset or liability. SFAS No. 157 establishes a fair value hierarchy,
      giving the highest priority to quoted prices in active markets and the lowest
      priority to unobservable data. SFAS No. 157 applies whenever other standards
      require assets or liabilities to be measured at fair value. This statement
      is
      effective in fiscal years beginning after November 15, 2007. The Company
      believes that the adoption of SFAS No. 157 will not have a significant effect
      on
      the Company's financial statements.





In
      February 2007, FASB issued Statement No. 159, The Fair Value Option for
      Financial Assets and Financial Liabilities ("SFAS No. 159"). SFAS No. 159
      provides a "Fair Value Option" under which a company may irrevocably elect
      fair
      value as the initial and subsequent measurement attribute for certain financial
      assets and liabilities. SFAS No. 159 will be available on contract-by-contract
      basis with changes in fair values recognized in earnings as those changes occur.
      SFAS No. 159 is effective for fiscal years after November 15, 2007. SFAS No.
      159
      also allows early adoption provided the entity also adopts the requirements
      of
      SFAS No. 157. The Company does not believe the adoption of SFAS No. 159 will
      have a material impact, if any, on its financial statements.





In
      December 2007, the FASB issued SFAS No. 141R, revised December 2007, "Business
      Combinations" ("SFAS 141R") which replaces SFAS 141 “Business Combinations” and
      establishes principles and requirements for how an acquirer recognizes and
      measures in its financial statements the identifiable assets acquired,
      liabilities assumed and any non-controlling interest in the acquirer 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. This standard is effective for fiscal years beginning after
      December 15, 2008.





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.





51




**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**


**Notes
      to Financial Statements**





**NOTE
      3 - Public Offering**





In
      December  2007, the Company completed its Offering in which it sold to the
      public 9,500,000 units (“Units”), at a price of $8.00 per Unit. Each Unit
      consists of one share of the Company’s common stock and one Redeemable Common
      Stock Purchase Warrant (“Warrants”). Each Warrant will entitle the holder to
      purchase from the Company one share of common stock at an exercise price of
      $5.00 commencing the later of the completion of a Business Combination and
      one
      year from the effective date of the Offering and expiring four years from the
      effective date of the Offering. The Company may redeem the Warrants, at a price
      of $.01 per Warrant upon 30 days’ notice while the Warrants are
      exercisable, only in the event that the last sale price of the common stock
      is
      at least $12.00 per share for any 20 trading days within a 30 trading day period
      ending on the third day prior to the date on which notice of redemption is
      given. In accordance with the warrant agreement relating to the Warrants sold
      and issued in the Offering, the Company is only required to use its best efforts
      to maintain the effectiveness of the registration statement covering the
      Warrants. The Company will not be obligated to deliver securities, and there
      are
      no contractual penalties for failure to deliver securities, if a registration
      statement is not effective at the time of exercise. Additionally, in the event
      that a registration is not effective at the time of exercise, the holder of
      such
      Warrant shall not be entitled to exercise such Warrant and in no event (whether
      in the case of a registration statement not being effective or otherwise) will
      the Company be required to net cash settle the warrant exercise. Consequently,
      the Warrants may expire unexercised and unredeemed.





The Company paid the underwriters in the Offering an underwriting
      discount of $2,280,000 of the gross proceeds of the Offering. The Company and
      the underwriters have agreed that payment of the balance of the underwriting
      discount of $3,040,000 will not be payable unless and until the Company
      completes a Business Combination and have waived their right to receive such
      payment upon the Company’s liquidation if it is unable to complete a Business
      Combination.




**NOTE
      4 - Note Payable, Stockholders**





The
      Company issued unsecured promissory notes in an aggregate principal amount
      of
      $132,990 to two of the Initial Stockholders. The notes were non-interest bearing
      and were paid in full on December 14, 2007.





52




**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**


**Notes
      to Financial Statements**




**NOTE
      5 - Income and Franchise Taxes**





For
      the
      period July 3, 2007 (inception) to December 31, 2007, the provision for income
      and franchise taxes consist of the following:


Federal
                  income tax - current
              
              $
              25,000Delaware
                  franchise taxes
              
              
              26,054


No
      provision for state and local income taxes has been made since the Company
      was
      formed as a vehicle to effect a Business Combination and, as a result does
      not
      conduct operations and is not engaged in a trade or business in any state.
      The
      Company is incorporated in Delaware and accordingly is subject to franchise
      taxes.




**NOTE
      6 - Commitments**





The
      Company presently occupies office space provided by an affiliate of the Initial
      Stockholders. Such affiliate has agreed that, until the Company consummates
      a
      Business


Combination,
      it will make such office space, as well as certain office and secretarial
      services, available to the Company, as may be required by the Company from
      time
      to time, at $1,700 per month commencing in January 2008. The current arrangement
      is month to month.





Pursuant
      to letter of agreements which the Initial Stockholders entered into with the
      Company and the underwriters, the Initial Stockholders will waive their right
      to
      receive distributions with respect to their founding shares upon the Company’s
      liquidation.





The
      Company’s Initial Stockholders purchased a total of 2,650,000 Warrants
      (“Insider Warrants”) at $ 1.00 per
      Warrant (for an aggregate purchase price of $2,650,000) privately from the
      Company. These purchases took place simultaneously with the consummation of
      the
      Offering. All of the proceeds received from this purchase were placed in the
      Trust Account. The Insider Warrants purchased are identical to the Warrants
      underlying the Units sold in the Offering except that the Warrants may not
      be
      called for redemption and the Insider Warrants may be exercisable on a “cashless
      basis,” at the holder’s option, so long as such securities are held by such
      purchaser or his affiliates. Furthermore, the purchaser has agreed that the
      Insider Warrants will not be sold or transferred by them, except for estate
      planning purposes, until after the Company has completed a Business
      Combination.





The
      Initial Stockholders and the holders of the Insider Warrants (or underlying
      securities) are entitled to registration rights with respect to their founding
      shares or Insider Warrants (or underlying securities) pursuant to an agreement
      signed on the effective date of the Offering. The holders of the majority of
      the
      founding shares are entitled to demand
      that the Company register these shares at any time commencing three months
      prior
      to the first anniversary of the consummation of a Business Combination. The
      holders of the


Insider
      Warrants (or underlying securities) are entitled to demand that the Company
      register these
      securities at any time after the Company consummates a Business Combination.
      In
      addition, the Initial Stockholders and holders of the Insider Warrants (or
      underlying securities) have certain “piggy-back” registration rights on
      registration statements filed after the Company’s consummation of a Business
      Combination.




53


**Tremisis
        Energy Acquisition Corporation II**
 **(a
        Corporation in the Development Stage )**
 **Notes
        to Financial Statements**


The
      Company has also agreed to pay the fees to the underwriters in the Offering
      as
      described in Note 3 above.





**NOTE
      7 - Preferred Stock**





The
      Company is authorized to issue 1,000,000 shares of preferred stock with such
      designations, voting and other rights and preferences as may be determined
      from
      time to time by the Board of Directors. There are no shares of preferred stock
      issued or outstanding.





The
      agreement with the underwriters will prohibit the Company, prior to a Business
      Combination, from issuing preferred stock which participates in the proceeds
      of
      the Trust Account or which votes as a class with the Common Stock on a Business
      Combination.





**NOTE
      8 - Summarized Quarterly Financial Information (unaudited)**





Summarized
      quarterly financial information for the period from inception (July 3, 2007)
      to
      December 31, 2007 is as follows:




From
                inception(July
                3, 2007) to
            
            Quarter
                endedSeptember
                30, 2007
            
            December
                31, 2007Interest
                income
            
            $
            -
            
            $
            152,990General
                and administrative expenses
            
            
            2,775
            
            
            48,595Provision
                for income taxes
            
            
            -
            
            
            25,000Net
                income (loss) for the period
            
            
            (2,775
            )
            
            79,395Accretion
                of Trust Account relating to common stock subject topossible
                conversion
            
            
            -
            
            
            (45,882
            )Net
                income (loss) attributable to common stockholders
            
            
            (2,775
            )
            
            33,513Weighted
                average number of shares outstanding, basic and diluted
            
            
            2,731,250
            
            
            4,177,109Net
                income per share, basic and diluted
            
            $
            (0.00
            )
            $
            0.01Number
                of shares outstanding subject to possible conversion
            
            
            -
            
            
            2,849,050Net
                income per share subject to possible conversion, basic and
                diluted
            
            $
            -
            
            $
            0.02





54




**Tremisis
      Energy Acquisition Corporation II**


**(a
      Corporation in the Development Stage)**


**Notes
      to Financial Statements**





**NOTE
      9 - Subsequent Event**




On
      January 24, 2008, the Company consummated the closing of the sale of 232,669
      Units which were sold subject to the over-allotment option. Each Unit sold
      in
      the Offering and pursuant to the over-allotment option consisted of one share
      of
      common stock, $.0001 par value per share, and one Warrant, each to purchase
      one
      share of the Company’s common stock. The 9,732,669 Units sold in the Offering,
      including the 232,669 Units sold subject to the over-allotment option, were
      sold
      at an Offering price of $8.00 per Unit, generating total gross proceeds of
      $77,861,352. Of the gross proceeds of the offering and the private placement
      of
      warrants, $77,400,511 (or approximately $7.95 per share) was placed in the
      Trust
      Account.




On
      January 24, 2008, the Company's Initial Stockholders returned an aggregate
      of
      298,082 shares of the Company's common stock to the Company for cancellation.
      The cancellation was due to the remainder of the underwriter's over-allotment
      option expiring unexercised. Upon receipt, such shares were then immediately
      cancelled by the Company.




55


**SIGNATURES**





Pursuant
      to the requirements of the Section 13 or 15 or 15(d) of the Securities Exchange
      Act of 1934, the registrant has duly caused this report to be signed on its
      behalf by the undersigned, thereunto duly authorized on the 31 st day of
      March 2008.




**TREMISIS
                ENERGY ACQUISITION CORPORATION II**By:
            /s/
              Lawrence S. CobenLawrence
                S. CobenChairman
                of the Board and Chief Executive Officer
              (Principal
                Executive Officer)




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





Name
            
            Title
            
            Date/s/
                Lawrence S. Coben
              Lawrence
                S. Coben
            
            Chairman
                of the Board and Chief Executive Officer
              (Principal
                Executive Officer)
            
            March
                31, 2008/s/
                Ronald D. Ormand
              
              Ronald
                D. Ormand
            
            President,
                Chief Financial Officer and Director
              (Principal
                Financial and Accounting Officer)
            
            March
                31, 2008/s/
                Stephen N. Casati
              
              Stephen
                N. Casati
            
            Director
            
            March
                31, 2008/s/
                Jon Schotz
              
              Jon
                Schotz
            
            Director
            
            March
                31, 2008/s/
                Charles A. Norris
              
              Charles
                A. Norris
            
            Director
            
            March
                31, 2008