**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-KSB**





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 000-52875




**NORTH
      SHORE ACQUISITION CORP.**


(Name
      of
      Small Business Issuer in Its Charter)





**Delaware**
            **26-0433980**(State
                of Incorporation)
            (Small
                Business Issuer
              I.R.S.
                Employer I.D. Number)





**175
                Great Neck Road, Suite 204, Great Neck, New York**
            **11021**(Address
                of principal executive offices)
            (Zip
                Code)





**(516)
      487-0200**


(Issuer’s
      Telephone Number, Including Area Code)





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


**None**





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


**Units
      consisting of one share of Common Stock, par value $.0001 per share, and one
      Warrant**


**Common
      Stock, $.0001 par value per share**


**Warrants
      to purchase shares of Common Stock**




Check
      whether the Issuer (1) has filed all reports required to be filed by Section
      13
      or 15(d) of the Exchange Act 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




Check
      if
      there is no disclosure of delinquent filers in response to Item 405 of
      Regulation S-B 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-KSB or any
      amendment to this Form
      10-KSB.               x




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




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




As
      of
      March 7, 2008, the aggregate market value of the ordinary shares held by
      non-affiliates of the Registrant was $42,042,770.




As
      of
      March 7, 2008, there were 7,941,249 ordinary shares, par value $.0001 per share,
      outstanding.




Transitional
      Small Business Disclosure Format (check
      one): Yes
o
      No x







**PART
      I**





**ITEM
      1. DESCRIPTION OF BUSINESS**




**Background**




North
      Shore Acquisition Corp. is a blank check company organized under the laws of
      the
      State of Delaware on June 26, 2007. We were formed to with the purpose of
      effecting 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.




On
      December 7, 2007, we closed our initial public offering of 6,300,000 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 1,600,000 warrants (“insider warrants”) at a price of $1.00 per
      sponsors’ warrant, generating total proceeds of $1,600,000. On January 24, 2008,
      we consummated the closing of an additional 53,000 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 $50,824,000. 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 $49,883,546, of which $49,693,160 was deposited into the trust account
      and
      the remaining proceeds of $190,386 became available to be used to provide for
      business, legal and accounting due diligence on prospective business
      combinations and continuing general and administrative expenses. Through
      December 31, 2007, we have used $49,529 of the net proceeds that were not
      deposited into the trust fund to pay 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 $49,411,767 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.




**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.





If
      we
      determine to enter into a business combination with a target business that
      is
      affiliated with our founders, we would do so only if we obtained an opinion
      from
      an independent investment banking firm that the business combination is fair
      to
      our unaffiliated stockholders from a financial point of view. We also do not
      anticipate acquiring an entity that is either a portfolio company of, or has
      otherwise received a financial investment from, an investment banking firm
      (or
      an affiliate thereof) that is affiliated with our founders. However, if
      circumstances change and we determined to acquire such an entity, we will be
      required to 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. Additionally, we will evaluate whether the terms of
      any
      such transaction are similar to those that we could have received from an
      unaffiliated third party and will disclose our conclusions in the proxy
      solicitation materials we send to stockholders in connection with such
      transaction.




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;




·
            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. Such an opinion
      would be included in the proxy solicitation materials we will furnish to our
      stockholders in connection with seeking stockholder approval of the proposed
      business combination. 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 business combination. Any vote to extend
      our
      corporate life to continue perpetually following the consummation of a business
      combination will be taken only if the business combination is approved. We
      will
      only consummate a business combination if stockholders vote both in favor of
      such business combination and our amendment to extend our corporate
      life.




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, as amended, which, among
      other matters, will include a description of the operations of the target
      business and audited historical financial statements of the business. We will
      provide stockholders with no less than the minimum amount of time required
      by
      Delaware corporate law, our bylaws and federal requirements to vote on a
      proposed transaction.




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”).
      This voting arrangement shall not apply to IPO shares purchased following our
      IPO in the open market by any of our founders. Accordingly, they may vote these
      shares on a proposed business combination any way they choose. 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 40% of the IPO shares both exercise
      their conversion rights and vote against the business combination. A non-vote,
      which is neither a vote in favor of, nor a vote against, a proposed transaction
      will accordingly have no effect on the approval of a proposed
      transaction.




**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.
      Notwithstanding the foregoing, a public stockholder, together with any affiliate
      of his or any other person with whom he is acting in concert or as a “group” (as
      defined in Section 13(d)(3) of the Securities Act of 1933, as amended) will
      be
      restricted from seeking conversion rights with respect to more than 10% of
      the
      IPO shares. Such a public stockholder would still be entitled to vote against
      a
      proposed business combination with respect to all shares owned by him or his
      affiliates. We believe this restriction will prevent stockholders from
      accumulating large blocks of stock before the vote held to approve a proposed
      business combination and attempt to use the conversion right as a means to
      force
      us or our management to purchase their stock at a significant premium to the
      then current market price. By limiting a stockholder’s ability to convert only
      10% of the IPO shares, we believe we have limited the ability of a small group
      of stockholders to unreasonably attempt to block a transaction which is favored
      by our other public stockholders. However, we are not restricting the
      stockholders’ ability to vote all of their shares against the
      transaction.




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
      $7.84.





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.
      Accordingly, we will only require stockholders to deliver their certificates
      prior to the vote if we give stockholders at least two weeks between the mailing
      of the proxy solicitation materials and the meeting date.




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.




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 November 30, 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 40% 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 39.99% of the IPO shares may exercise their conversion
      rights and the business combination will still go forward. We have set the
      conversion percentage at 40% in order to reduce the likelihood that a small
      group of investors holding a block of our stock will be able to prevent 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 November 30, 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 $7.84. 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. Our
      officers and directors 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. We
      have
      questioned such individuals on their financial net worth and reviewed their
      financial information and believe they will be able to satisfy any
      indemnification obligations that may arise.




Under
      the
      Delaware General Corporation Law, stockholders may be held liable for claims
      by
      third parties against a corporation to the extent of distributions received
      by
      them in a dissolution. If the corporation complies with certain procedures
      set
      forth in Section 280 of the Delaware General Corporation Law intended to ensure
      that it makes reasonable provision for all claims against it, including a 60-day
      notice period during which any third-party claims can be brought against the
      corporation, a 90-day period during which the corporation may reject any claims
      brought, and an additional 150-day waiting period before any liquidating
      distributions are made to stockholders, any liability of stockholders with
      respect to a liquidating distribution is limited to the lesser of such
      stockholder’s pro rata share of the claim or the amount distributed to the
      stockholder, and any liability of the stockholder would be barred after the
      third anniversary of the dissolution. However, as stated above, it is our
      intention to make liquidating distributions to our stockholders as soon as
      reasonably possible after November 30, 2009 and, therefore, we do not intend
      to
      comply with those procedures. 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 such date. Because we will not be complying with Section 280,
      Section 281(b) of the Delaware General Corporation Law requires us to adopt
      a
      plan that will provide for our payment, based on facts known to us at such
      time,
      of (i) all existing claims, (ii) all pending claims and (iii) all claims that
      may be potentially brought against us within the subsequent 10 years.
      Accordingly, we would be required to provide for any claims of 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 our distributing the funds in the
      trust account to our public stockholders. Absent special circumstances, the
      rights of creditors take priority over the rights of stockholders under Delaware
      corporate law. However, because we are a blank check company, rather than an
      operating company, and our operations are limited to searching for prospective
      target businesses to acquire, the only likely claims to arise would be from
      our
      vendors and service providers (such as accountants, lawyers, investment bankers,
      etc.) and potential target businesses. As described above, pursuant to the
      obligation contained in our underwriting agreement, we will seek to have all
      vendors, service providers and prospective target businesses execute agreements
      with us waiving any right, title, interest or claim of any kind they may have
      in
      or to any monies held in the trust account. Nevertheless, there is no guarantee
      that vendors, service providers and prospective target businesses will execute
      such agreements. There is also no guarantee that, even if they execute such
      agreements with us, they will not seek recourse against the trust account.
      A
      court could also conclude that such agreements are not legally enforceable.
      As a
      result, if we liquidate, the per-share distribution from the trust account
      could
      be less than $7.84 due to claims or potential claims of creditors.





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 November 30, 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.




**Competition**




In
      identifying, evaluating and selecting a target business, we expect to 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. Additionally, we may 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
      the
      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 shareholder approval of a business combination
                may
                delay the completion of a
                transaction;




·
            our
                obligation to convert into cash ordinary shares held by our public
                shareholders 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 options, and the future dilution they potentially
                represent.




Any
      of
      these factors may place us at a competitive disadvantage in successfully
      negotiating a business combination.




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
      three executive officers. These individuals are not obligated to devote 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.




**Risks
      Associated with Our Business**




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




We
      are a
      recently organized development stage company with no operating results to date.
      Since we do not have an operating history, you will have no basis upon which
      to
      evaluate our ability to achieve our business objective, which is to acquire
      an
      operating business. We have not conducted any discussions with respect to any
      business combination and we have no plans, arrangements or understandings with
      any prospective acquisition candidates. We will not generate any revenues until,
      at the earliest, after the consummation of a business combination.




***If
      we are unable to consummate a business combination, holders of IPO Shares will
      be forced to wait until November 30, 2009 before receiving liquidation
      distributions.***




We
      have
      until November 30, 2009 to complete a business combination. We have no
      obligation to return funds to holders of IPO Shares prior to such date unless
      we
      consummate a business combination prior thereto. Only after the expiration
      of
      this full time period will holders of IPO Shares be entitled to liquidation
      distributions if we are unable to complete a business combination. Accordingly,
      investors’ funds may be unavailable to them until such date.




***Because
      there are numerous companies with a business plan similar to ours seeking to
      effectuate a 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 a business combination in specific industries,
      a number of them may consummate a business combination in any industry they
      choose. Therefore, we may be subject to competition from these and other
      companies seeking to consummate a business plan similar to ours. Because of
      this
      competition, we cannot assure you that we will be able to effectuate a business
      combination within the required time periods.




Furthermore,
      our obligation 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.
      If
      we are unable to consummate a business combination with a target business within
      the prescribed time periods, we will be forced to liquidate.







***If
      the net proceeds of our IPO not being held in trust are insufficient to allow
      us
      to operate until November 30, 2009, we may be unable to complete a business
      combination.***




We
      believe that the funds available to us outside of the trust account, 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 until November 30, 2009, assuming
      that a 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 such 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.




***A
      decline in interest rates could limit the amount available to fund our search
      for a target business or businesses and complete a 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 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.




***If
      third parties bring claims against us, the proceeds held in trust could be
      reduced and the per-share liquidation price received by shareholders will be
      less than $7.84 per share.***




As
      of
      December 31, 2007, the per-share liquidation price of the funds held in trust
      was $7.84. Our placing of funds in trust may not protect those funds from third
      party claims against us. Although we will seek to have all vendors and service
      providers we engage and 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 for the benefit of holders of IPO
      Shares, there is no guarantee that they will execute such agreements. Nor is
      there any guarantee that, even if such entities execute such agreements with
      us,
      they will not seek recourse against the trust account. A court could also
      conclude that such agreements are not legally enforceable. Accordingly, the
      proceeds held in trust could be subject to claims which could take priority
      over
      those of holders of IPO Shares. If we liquidate before the completion of a
      business combination and distribute the proceeds held in trust to our public
      stockholders, our officers and directors have jointly and severally 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, we cannot assure you that they will be able to
      satisfy those obligations. Therefore, we cannot assure you that the per-share
      distribution from the trust fund, if we liquidate, will not be less than $7.84,
      plus interest then held in the trust fund, 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 such claims deplete the trust
      account, we cannot assure you we will be able to return to holders of IPO Shares
      at least $7.84 per share.







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




Our
      amended and restated certificate of incorporation provides that we will continue
      in existence only until November 30, 2009. If we have not completed a business
      combination by such date and amended this provision in connection thereto,
      pursuant to the Delaware General Corporation Law, our corporate existence will
      cease except for the purposes of winding up our affairs and liquidating. Under
      Sections 280 through 282 of the Delaware General Corporation Law, stockholders
      may be held liable for claims by third parties against a corporation to the
      extent of distributions received by them in a dissolution. If the corporation
      complies with certain procedures set forth in Section 280 of the Delaware
      General Corporation Law intended to ensure that it makes reasonable provision
      for all claims against it, including a 60-day notice period during which any
      third-party claims can be brought against the corporation, a 90-day period
      during which the corporation may reject any claims brought, and an additional
      150-day waiting period before any liquidating distributions are made to
      stockholders, any liability of stockholders with respect to a liquidating
      distribution is limited to the lesser of such stockholder’s pro rata share of
      the claim or the amount distributed to the stockholder, and any liability of
      the
      stockholder would be barred after the third anniversary of the dissolution.
      However, it is our intention to make liquidating distributions to our
      stockholders as soon as reasonably possible after November 30, 2009 and,
      therefore, we do not intend to comply with those procedures. Because we will
      not
      be complying with those procedures, we are required, pursuant to Section 281
      of
      the Delaware General Corporation Law, to adopt a plan that will provide for
      our
      payment, based on facts known to us at such time, of (i) all existing claims,
      (ii) all pending claims and (iii) all claims that may be potentially brought
      against us within the subsequent 10 years. 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. 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.




***If
      we are forced to file a bankruptcy case or an involuntary bankruptcy case is
      filed against us which is not dismissed, a trustee in bankruptcy could seek
      to
      recover all amounts received by our stockholders.***




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 November 30, 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 be practically
      worthless.***




No
      public
      warrant 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 and effective. Under the terms of the warrant agreement, we have agreed
      to use our best efforts to meet these conditions and to maintain a current
      and
      effective prospectus relating to the common stock issuable upon exercise of
      the
      warrants until the expiration of the warrants. However, we cannot assure you
      that we will be able to do so, and if we do not maintain a current and effective
      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 and effective, 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 and effective.




***An
      investor will only be able to exercise a warrant if the issuance of ordinary
      shares upon such 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, thereby potentially limiting the value of the
      warrants.***




No
      public
      warrants will be exercisable and we will not be obligated to issue ordinary
      shares unless the ordinary shares 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. At the time that the warrants
      become exercisable (following our completion of a business combination), we
      expect to become listed on a national securities exchange, which would provide
      an exemption from registration in every state. Accordingly, we believe holders
      in every state will be able to exercise their warrants as long as our prospectus
      relating to the ordinary shares issuable upon exercise of the warrants is
      current. However, we cannot assure you of this fact. As a result, the public
      warrants may be deprived of any value, the market for such warrants may be
      limited and the holders of such warrants may not be able to exercise their
      warrants if the ordinary shares issuable upon such exercise is not qualified
      or
      exempt from qualification in the jurisdictions in which the holders of such
      warrants reside.




***Since
      we have not yet selected a particular industry or target business with which
      to
      complete a business combination, we are unable to currently ascertain the merits
      or risks of the industry or business in which we may ultimately
      operate.***




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 those entities. 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. Although our management will
      endeavor to evaluate the risks inherent in a particular industry or target
      business, we cannot assure you that we will properly ascertain or assess all
      of
      the significant risk factors. As a result, our business following a business
      combination may be harmed and our stock price may be adversely affected. We
      also
      cannot assure you that an investment in our units will not 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 or debt securities to complete a business combination, which
      would reduce the equity interest of our shareholders and likely cause a change
      in control of our ownership.***




Our
      amended and restated certificate of incorporation authorizes the issuance of
      up
      to 20,000,000 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
      3,265,751 authorized but unissued shares of our common stock available for
      issuance (after appropriate reservation for the issuance of the shares upon
      full
      exercise of our outstanding warrants and the unit purchase option granted to
      EarlyBirdCapital, the representative of the underwriters) and all of the
      1,000,000 shares of preferred stock available for issuance. Although we have
      no
      commitment as of the date of this time, we are likely to issue a substantial
      number of additional shares of our common or preferred stock, or a combination
      of common and preferred stock, to complete a business combination. The issuance
      of additional shares of our common stock or any number of shares of our
      preferred stock:




·
            may
                significantly reduce the equity interest of current
                investors;




·
            may
                subordinate the rights of holders 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;
                and




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




***We
      may issue debt securities to complete a business combination, which could have
      a
      negative effect on our cash position.***




If
      we
      issue debt securities, it could result in:




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




·
            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.







***Our
      ability to successfully effect a 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 a business combination.***




Our
      ability to successfully effect a business combination is dependent upon the
      efforts of our key personnel, such as Barry J. Gordon, Marc H. Klee and Alan
      J.
      Loewenstein. The role of our key personnel in the target business, however,
      cannot presently be ascertained. Although 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. While we intend to closely scrutinize any
      individuals we engage after a business combination, we cannot assure you that
      our assessment of these individuals will prove to be correct. 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 a 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 to
      us.***




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.




***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 a 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 a business combination. All
      of
      our executive officers 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 a business combination. 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 not
      have
      an opportunity to review a potential transaction.




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




Our
      officers and directors may become involved with blank check companies similar
      to
      our company. 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 not have an opportunity to review a potential
      transaction.







***All
      of our officers and directors own founder shares and insider warrants. These
      securities will not participate in liquidation distributions. Therefore, our
      officers and directors may present a particular target business to us that
      otherwise would not be attractive so as to avoid having their securities become
      worthless.***




All
      of
      our officers and directors own founders’ shares and insider warrants. Such
      individuals have waived their right to receive distributions with respect to
      their founders’ shares upon our liquidation if we are unable to consummate a
      business combination. Accordingly, the founders’ shares, as well as the insider
      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.




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




If
      at any
      time we have net tangible assets of $5,000,000 or less and our ordinary shares
      have a market price per share of less than $5.00, transactions in our ordinary
      shares may be subject to the “penny stock” rules promulgated under the
      Securities Exchange Act of 1934. Under these rules, broker-dealers who recommend
      such securities to persons other than institutional accredited investors
      must:




·
            make
                a special written suitability determination for the
                purchaser;




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




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




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




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




***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. As a result, we would not be
      able
      to reduce the risks of operating in a single industry which could cause our
      results of operations to be negatively impacted.***




Our
      business combination must be with a business with a 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. By consummating a 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 particular industry in which we may operate subsequent to a
      business combination.




***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 integration 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.




***We
      may proceed with a business combination even if public stockholders owning
      2,541,199 of the IPO shares exercise their conversion
      rights.***




We
      may
      proceed with a business combination as long as public stockholders owning less
      than 40% of the IPO Shares exercise their conversion rights. Accordingly, public
      stockholders holding up to 2,541,199 IPO Shares may exercise their conversion
      rights and we could still consummate a proposed business combination. We have
      set the conversion percentage to 40% in order to reduce the likelihood that
      a
      small group of investors holding a block of our stock will be able to prevent
      us
      from completing a business combination that may otherwise be approved by a
      large
      majority of our public stockholders.




***If
      we are unable to arrange any necessary third party financing, we may not be
      able
      to consummate a business combination.***




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 a 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 shareholders to exercise their conversion rights may not allow
      us
      to effectuate the most desirable business combination or optimize our capital
      structure.***




When
      we
      seek shareholder approval of any business combination, we will offer each holder
      of the IPO Shares (but not our founders) the right to have his, her or its
      IPO
      Shares converted to cash if the shareholder votes against the business
      combination and the 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 such conversion, or 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. 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 a business combination that requires us to use all
      of
      the funds held in the trust account as part of the purchase price, or we may
      end
      up having a leverage ratio that is not optimal for our business combination.
      This may limit our ability to effectuate the most attractive business
      combination available to us.




***We
      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 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.




***Public
      stockholders, together with any affiliates of theirs or any other person with
      whom they are acting in concert or as a ‘‘group’’ with, will be restricted from
      seeking conversion rights with respect to more than 10% of the IPO
      shares.***




When
      we
      seek stockholder approval of any business combination, we will offer each public
      stockholder (but not our founders to the extent the hold IPO shares) the right
      to have his, her, or its shares of common stock converted to cash if the
      stockholder votes against the business combination and the business combination
      is approved and completed. Notwithstanding the foregoing, a public stockholder,
      together with any affiliate of his or any other person with whom he is acting
      in
      concert or as a “group” will be restricted from seeking conversion rights with
      respect to more than 10% of the IPO shares. Accordingly, if you purchased more
      than 10% of the IPO shares and a proposed business combination is approved,
      you
      will not be able to seek conversion rights with respect to the full amount
      of
      your shares and may be forced to hold such additional shares or sell them in
      the
      open market. We cannot assure you that the value of such additional shares
      will
      appreciate over time following a business combination or that the market price
      of the common stock will exceed the per-share conversion price.







***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. While we believe that there
      are numerous potential target businesses that we could acquire with the net
      proceeds of the 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
      certain target businesses. Furthermore, the obligation we have to seek
      shareholder 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. Furthermore, our negotiating
      position with any potential target may be harmed as we approach the deadline
      for
      the consummation of a business combination as such target business will know
      that our deadline cannot be extended. 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.




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




Our
      founders (including all of our officers and directors) collectively own 20%
      of
      our issued and outstanding shares of common stock (not including any shares
      of
      common stock issuable upon exercise of the insider warrants). None of our
      founders or their affiliates has indicated any intention to purchase any
      additional units or shares of common stock from persons in the open market
      or in
      private transactions. 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.




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 a business
      combination, in which case all of the current directors will continue in office
      until at least the consummation of the 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 a business combination.




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




We
      issued
      warrants to purchase 6,353,000 shares of common stock as part of the units
      sold
      in our IPO (including the over-allotment option) and insider warrants to
      purchase 1,600,000 shares of common stock. We also issued an option to purchase
      420,000 units to the representative of the underwriters which, if exercised,
      will result in the issuance of an additional 420,000 warrants. To the extent
      we
      issue ordinary shares to effect a business combination, the potential for the
      issuance of a substantial number of additional ordinary shares upon exercise
      of
      these warrants and option 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 ordinary shares and reduce the value of
      the
      shares issued to complete the business combination. Accordingly, our warrants
      and option may make it more difficult to effectuate a business combination
      or
      increase the cost of acquiring the target business. Additionally, the sale,
      or
      even the possibility of sale, of the shares underlying the warrants and option
      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 and
      option are exercised, you may experience dilution to your
      holdings.







***Our
      management’s ability to require holders of our warrants to exercise such
      warrants on a cashless basis, if exercised, would cause holders to receive
      fewer
      ordinary shares 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 purchasers of the insider units exercise their registration
      rights with respect to their founder shares or insider warrants and underlying
      securities, it may have an adverse effect on the market price of our ordinary
      shares and warrants and the existence of these rights may make it more difficult
      to effect a business combination.***




Our
      founders are entitled to demand that we register the resale of their founders’
shares at any time commencing three months prior to the date on which their
      shares are released from escrow. Additionally, the purchasers of the insider
      warrants are entitled to demand that we register the resale of these securities
      (and the underlying securities) at any time after we consummate a business
      combination. If such individuals exercise their registration rights with respect
      to all of their securities, then there will be an additional 1,588,249 shares
      of
      common stock and 1,600,00 warrants (plus an additional 1,600,00 shares of common
      stock underlying such 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 ordinary shares. In addition, the
      existence of these rights may make it more difficult to effectuate a business
      combination or increase the cost of acquiring the target business, as the
      shareholders of the target business may be discouraged from entering into a
      business combination with us or will request a higher price for their securities
      because of the potential effect the exercise of such rights may have on the
      trading market for our ordinary shares.




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




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 invested the proceeds
      held in the trust fund, 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 a 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.




**ITEM
      2. DESCRIPTION OF PROPERTY**




We
      maintain our principal executive offices at 175 Great Neck Road, Suite 204,
      Great Neck, New York 11201-3313. The cost for this space is included in the
      $8,000 per-month fee American Fund Advisors will charge us for general and
      administrative services. We believe, based on rents and fees for similar
      services in the New York metropolitan area, that the fee charged by American
      Fund Advisors is at least as favorable as we could have obtained from an
      unaffiliated party. 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**




No
      matter
      was submitted to a vote of our security holders during the fourth quarter of
      the
      fiscal year ended December 31, 2007.




**PART
      II**




**ITEM
      5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS**




**Market
      Information**




Our
      units, common stock and warrants trade on the OTC Bulletin Board under the
      symbols NSAQU, NSAQ and NASQW, respectively. The following table sets forth
      the
      range of high and low closing bid prices for the units, ordinary shares and
      warrants for the periods indicated since the units commenced public trading
      on
      December 7, 2007, and since the common stock and warrants commenced public
      trading on December 13, 2007. The over-the-counter market quotations reflect
      inter-dealer prices, without retail mark-up, mark-down or commission and may
      not
      necessarily reflect actual transactions.








Units
            
            Ordinary
                Shares
            
            WarrantsHigh
            
            Low
            
            High
            
            Low
            
            High
            
            Low2008:First
                Quarter*
            
            
            7.89
            
            
            7.70
            
            
            7.10
            
            
            6.96
            
            
            0.90
            
            
            0.642007:Fourth
                Quarter
            
            
            8.00
            
            
            7.75
            
            
            7.15
            
            
            7.02
            
            
            0.90
            
            
            0.75




*
      Through
      March 7, 2008.




**Holders**




As
      of
      March 7, 2008, there was 1 holder of record of our units, 7 holders of
      record of our common stock and 7 holders 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
      June
      2007, we sold the following shares of common stock without registration under
      the Securities Act of 1933, as amended:




Name
            
            Number
                of
              Shares
            
            Relationship
                to UsBarry
                J. Gordon
            
            369,000
            
            Chairman
                and Chief Executive OfficerMarc
                H. Klee
            
            287,000
            
            President,
                Chief Financial Officer, Secretary and DirectorRobert
                Sroka
            
            162,500
            
            DirectorArthur
                H. Goldberg
            
            162,500
            
            DirectorHarvey
                Granat
            
            162,500
            
            StockholderAlan
                J. Loewenstein
            
            106,500
            
            Vice
                President




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 accredited investors. The shares issued to the individuals above were
      sold at a purchase price of approximately $0.02 per share (an aggregate of
      $25,000).




Effective
      September 18, 2007 and November 30, 2007, our board of directors authorized
      a
      stock dividend of 0.38 and 0.05 shares of common stock, respectively, for each
      outstanding share of common stock, effectively lowering the purchase price
      to
      approximately $0.01 per share.







Simultaneously
      with the consummation of the IPO, we consummated the private sale of 1,600,000
      insider warrants at a price of $1.00 per sponsors’ warrant, generating total
      proceeds of $1,600,000. The insider units and insider warrants were purchased
      by
      Barry J. Gordon, Marc H. Klee, Alan J. Loewenstein, Robert Sroka, Arthur H.
      Goldberg and Harvey Granat.




**Initial
      Public Offering**




On
      December 7, 2007, we closed our IPO of 6,300,000 units with each unit consisting
      of one share of common stock and one warrant, each to purchase one share of
      common stock at an exercise price of $5.00 per share. On January 24, 2008,
      we
      consummated the closing of an additional 53,000 units which were subject to
      the
      over-allotment option. The units from the IPO (including the over-allotment
      option) were sold at an offering price of $8.00 per unit, generating total
      gross
      proceeds of $50,824,000. EarlyBirdCapital, Inc. acted as representative of
      the
      underwriters. The securities sold in the IPO were registered under the
      Securities Act of 1933 on a registration statement on Form S-1 (No. 333-145278).
      The Securities and Exchange Commission declared the registration statement
      effective on November 30, 2007.




We
      paid a
      total of $2,525,614 in underwriting discounts and commissions (after deferring
      $1,512,000) and for costs and expenses related to the offering. After deducting
      the underwriting discounts and commissions and the offering expenses, the total
      net proceeds to us from the offering were $48,283,546, of which $48,093,160
      was
      deposited into the trust account and the remaining proceeds of $190,386 became
      available to be used to provide for business, legal and accounting due diligence
      on prospective business combinations and continuing general and administrative
      expenses. In addition, all of the proceeds from the private sale of the units
      and warrants were deposited into the trust fund, for a total of $49,693,160
      held
      in trust (or approximately $7.82 per share sold in the offering). The net
      proceeds deposited into the trust fund remain on deposit in the trust fund
      and
      have earned $127,767 in interest through December 31, 2007.




**ITEM
      6. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**




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




**Forward
      Looking Statements**




The
      statements discussed in this Report include forward looking statements that
      involve risks and uncertainties detailed from time to time in the Company’s
      reports filed with the Securities and Exchange Commission.




**Plan
      of Operations**




We
      are a
      blank check company organized under the laws of the State of Delaware on June
      26, 2007. We were formed to with the purpose of effecting 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.




For
      the
      period from June 26, 2007 (inception) to December 31, 2007, we had net income
      of
      $26,866 derived from interest income of $128,894, offset by $102,028 for travel
      and other expenses.







We
      consummated our initial public offering of 6,300,000 units on December 7, 2007.
      Simultaneously, our founders purchased 1,600,000 insider warrants for $1.00
      per
      warrant. On January 24, 2008, we consummated the sale of an additional 53,000
      units that were subject to our underwriter’s over-allotment option. Gross
      proceeds from our IPO (including from our private placement of the insider
      warrants) were $52,424,000. We paid a total of $2,540,454 in underwriting
      discounts and commissions (after deferring $1,512,000) and for costs and
      expenses related to the offering. After deducting the underwriting discounts
      and
      commissions and the offering expenses, the total net proceeds to us from the
      offering were approximately $48,283,546, of which $48,093,160 was deposited
      into
      the trust account. In addition, all of the proceeds from the private sale of
      the
      units and warrants were deposited into the trust fund, for a total of
      $49,693,160 held in trust (or approximately $7.82 per share sold in the
      offering). The remaining proceeds are available to be used by us to provide
      for
      business, legal and accounting due diligence on prospective acquisitions, tax
      payments and continuing general and administrative expenses. We are also able
      to
      have released to us interest income on the proceeds held in the trust fund
      (i)
      up to $1,000,000 to fund our working capital requirements and (ii) any amounts
      necessary to pay our tax obligations. The net proceeds deposited into the trust
      fund remain on deposit in the trust fund and have earned $127,767 in interest
      through December 31, 2007.




We
      intend
      to use substantially all of the net proceeds of the IPO to acquire a target
      business, including identifying and evaluating prospective acquisition
      candidates, selecting the target business, and structuring, negotiating and
      consummating the 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 fund 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 November 30, 2009, assuming that a business combination is
      not
      consummated during that time. As indicated above, there can be released to
      us,
      from time to time, interest earned on the funds held in the trust account,
      up to
      an aggregate of $1,000,000, to fund expenses related to investigating and
      selecting a target business, as well as any amounts necessary to pay our tax
      obligations. From November 30, 2007 through November 30, 2009, we anticipate
      that we will incur approximately $500,000 of expenses for the search for target
      businesses and for the legal, accounting and other third-party expenses
      attendant to the due diligence investigations, structuring and negotiating
      of a
      business combination; $200,000 of expenses for the due diligence and
      investigation of a target business by our founders; $192,000 for the
      administrative fee payable to American Fund Advisors ($8,000 per month for
      twenty four months); $50,000 of expenses in legal and accounting fees relating
      to our SEC reporting obligations; and $208,000 for general working capital
      that
      will be used for miscellaneous expenses, general corporate purposes, liquidation
      obligations and reserves, including approximately $120,000 for director and
      officer liability insurance premiums. Through December 31, 2007, we have
      transferred $0 of interest earned on the trust funds for working capital
      purposes. We do not believe we will need to raise additional funds following
      the
      IPO 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, although we have not entered into any
      such
      arrangement and have no current intention of doing so.




Commencing
      on November 30, 2007 and ending upon the acquisition of a target business or
      our
      liquidation, we began incurring a fee from American Fund Advisors, an affiliate
      of Barry J. Gordon, Marc H. Klee and Alan J. Loewenstein, a monthly fee of
      $8,000 for general and administrative services. Additionally, Barry J. Gordon
      and Arthur H. Goldberg advanced an aggregate of $100,000 to us, on a
      non-interest bearing basis, for payment of offering expenses on our behalf.
      This
      loan was repaid following our initial public offering from the proceeds of
      the
      offering.







**Off-Balance
      Sheet Arrangements**




Options
      and warrants issued in conjunction with our IPO are equity linked derivatives
      and accordingly represent off-balance sheet arrangements. The options and
      warrants meet the scope exception in paragraph 11(a) of Financial Accounting
      Standard (FAS) 133 and are accordingly not accounted for as derivatives for
      purposes of FAS 133, but instead are accounted for as equity. See Footnote
      __ to
      the financial statements for more information.




**ITEM
      7. FINANCIAL STATEMENTS**




This
      information appears following Item 14 of this Report and is incorporated herein
      by reference.




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




None.




**ITEM
      8A. CONTROL 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 Officer and
      our
      Principal Financial and Accounting Officer have 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
      Reprt 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. Our Principal Executive and Principal Financial and Accounting
      Officer concluded that our disclosure controls and procedures are effective
      at
      that reasonable assurance level.




**ITEM
      8B. OTHER INFORMATION**




None.









**PART
      III**




**ITEM
      9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
      WITH
      SECTION 16(a) OF THE EXCHANGE ACT.**





**Directors
      and Executive Officers**




Our
      current directors and executive officers are as follows:




Name
            
            Age
            
            PositionBarry
                J. Gordon
            
            62
            
            Chairman
                of the Board and Chief Executive OfficerMarc
                H. Klee
            
            53
            
            President,
                Chief Financial Officer, Secretary and DirectorAlan
                J. Loewenstein
            
            50
            
            Vice
                PresidentRobert
                Sroka
            
            58
            
            DirectorArthur
                H. Goldberg
            
            65
            
            Director




***Barry
      J. Gordon*** has been
      our chairman of the board and chief executive officer since our inception.
      Mr.
      Gordon has been the chairman of the board of Avantair, Inc. (formerly known
      as
      Ardent Acquisition Corporation) since its inception. Ardent Acquisition
      Corporation was a blank check company formed on November 22, 2004 to effect
      a
      merger, capital stock exchange, asset acquisition or other similar business
      combination with an operating business. In February 2007, Ardent Acquisition
      Corporation acquired Avantair. Avantair is engaged in the sale and management
      of
      fractional ownerships of professionally piloted aircraft for personal and
      business use. Mr. Gordon served as executive vice president of American Fund
      Advisors, Inc. from September 1978 until December 1980, as its president from
      December 1980 until May 1987 and has been its chairman of the board since May
      1987. American Fund Advisors is a private money management firm that manages
      money for high net worth individuals, pension and profit sharing plans. Mr.
      Gordon has been a director of American Fund Advisors since December 1980. From
      December 1991 to March 2005, he was the president, and from December 1991 to
      December 1993, he was a director, of the John Hancock Technology Series, Inc.,
      an investment company. Since September 1999, Mr. Gordon has been president,
      chief executive officer and a director of BlueStone AFA Management, LLC, the
      general partner of the AFA Private Equity Fund 1, (formerly BlueStone AFA Fund),
      a venture capital fund providing equity capital for public and private companies
      primarily in the technology sector, and since January 2000, has been a director
      of the AFA Private Equity Fund 1. Mr. Gordon was also chairman of the board
      and
      chief executive officer of the New Jersey Cardinals, a Class A affiliate of
      the
      St. Louis Cardinals, from February 1990 until April 2006 and the Norwich
      Navigators, a Class AA affiliate of the San Francisco Giants, from March 1991
      until April 2005. He has also served as a director of Winfield Capital Corp.,
      an
      Over The Counter Bulletin Board listed small business investment company, from
      October 1995 until October 2005. Mr. Gordon was also the 1992 Entrepreneur
      of
      the Year for Long Island in financial services. Mr. Gordon received a B.B.A.
      from the University of Miami and an M.B.A. from Hofstra University




***Marc
      H. Klee*** has been
      our president, chief financial officer, secretary and a member of our board
      of
      directors since our inception. Mr. Klee was the vice president of American
      Fund
      Advisors from January 1981 until May 1984, its senior vice president from May
      1984 until March 2000 and has been its executive vice president since March
      2000. He has also been a director of American Fund Advisors since May 1984.
      From
      November 2004 until February 2007, Mr. Klee was the president, chief financial
      officer, secretary and a member of the board of directors of Ardent Acquisition
      Corporation. Mr. Klee was the vice president of the John Hancock Technology
      Series, Inc. from May 1981 until May 1987 and was co-portfolio manager of the
      John Hancock Technology Fund from January 1983 to March 2005. Since September
      1999, Mr. Klee has been secretary and a director of BlueStone AFA Management,
      LLC and since January 2000, has been a director of the AFA Private Equity Fund
      1. Mr. Klee was also the president of the New Jersey Cardinals from February
      1990 until April 2006 and vice president of the Norwich Navigators from March
      1991 until April 2005. Mr. Klee received a B.A. from the State University of
      New
      York at Stony Brook (Phi Beta Kappa), an M.B.A. from the Wharton School of
      Business at the University of Pennsylvania and is a chartered financial
      analyst.









***Alan
      J. Loewenstein*** has been
      our vice president since our inception. Mr. Loewenstein has been the senior
      vice
      president of American Fund Advisors since April 2000 and was its vice president
      from ay 1983 to April 2000. From November 2004 until February 2007, Mr.
      Loewenstein was a vice president of Ardent Acquisition Corporation. Prior to
      joining American Fund Advisors, Mr. Loewenstein served as an investment officer
      at Fidelity Union Bank from June 1980 to January 1983. Mr. Loewenstein received
      a B.A. from Rutgers University, an M.B.A. from Rutgers School of Management
      and
      is a chartered financial analyst.




***Robert
      Sroka*** has been
      a member of our board of directors since our inception. Mr. Sroka has served
      as
      a managing director of Corporate Solutions Group, LLC, an investment banking
      firm, since December 2003. Mr. Sroka has also served as managing partner of
      Lighthouse Partners, a private investment and business consulting company,
      since
      August 1998. From November 2004 until February 2007, Mr. Sroka was a vice
      president of Ardent Acquisition Corporation. From February 1994 to June 1998,
      Mr. Sroka served as managing director of Investment Banking-Mergers and
      Acquisitions for J.P. Morgan. Mr. Sroka has served as a director of Sypris
      Solutions, Inc., a Nasdaq National Market listed provider of outsourced services
      and specialty products, since March 1997. He has also served as a director
      of
      North American Insurance Leaders, Inc., a blank check company formed to effect
      a
      merger, capital stock exchange, asset acquisition, stock purchase and/or other
      similar transaction with one or more businesses in the insurance or insurance
      services industry in North America, since September 2006. Mr. Sroka also served
      as non-executive chairman of the board of Avado Brands, Inc., an operator of
      restaurants from November 2003 until May 2005. On February 4, 2004, Avado
      Brands, Inc. filed a voluntary petition under the federal bankruptcy laws,
      from
      which it emerged in May 2005. Mr. Sroka received a B.A. (cum laude) from the
      State University of New York at Buffalo and an M.A. (with honors) and an M.B.A.
      (with distinction) from New York University.




***Arthur
      H. Goldberg*** has been
      a member of our board of directors since our inception. Mr. Goldberg has served
      as a member of Corporate Solutions Group since January 2000. Mr. Goldberg has
      been a director of Avantair since its inception and has been a trustee of
      Ramco-Gershenson Properties Trust, a New York Stock Exchange listed real estate
      investment trust, since 1988. Mr. Goldberg received a B.S. (cum laude) from
      New
      York University Stern School and a J.D. from the New York University School
      of
      Law.




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 Arthur H. Goldberg, will
      expire at our first annual meeting of stockholders. The term of office of the
      second class of directors, consisting of Robert Sroka, will expire at the second
      annual meeting. The term of the third class of directors, consisting of Barry
      J.
      Gordon and Marc H. Klee 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 North
      Shore Acquisition Corp., 175 Great Neck Road, Suite 204, Great Neck, New York
      11201-3313.




**Nominations
      to the Board of Directors**




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




**ITEM
      10. EXECUTIVE COMPENSATION**




No
      executive officer has received any cash compensation for services rendered
      to
      us. Commencing on November 30, 2007 through the acquisition of a target business
      or our liquidation, we will pay American Fund Advisors, an affiliate of Messrs.
      Gordon, Klee and Loewenstein, a fee of $8,000 per month for providing us with
      office space and certain office and secretarial services. However, this
      arrangement is solely for our benefit and is not intended to provide our
      officers and directors compensation in lieu of a salary. Other than the $8,000
      per month administrative fee, no compensation of any kind, including finders,
      consulting or other similar fees, will be paid to any of our founders, 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. There is no limit on the amount of these out-of-pocket
      expenses and there will be no review of the reasonableness of the expenses
      by
      anyone other than our board of directors, which includes persons who may seek
      reimbursement, or a court of competent jurisdiction if such reimbursement is
      challenged. Because of the foregoing, we will generally not have the benefit
      of
      independent directors examining the propriety of expenses incurred on our behalf
      and subject to reimbursement.




**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.




*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
      11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT**




**Security
      Ownership of Certain Beneficial Owners and Management**




The
      following table sets forth information regarding the beneficial ownership of
      our
      ordinary shares as of March 7, 2008 by:




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




·
            each
                of our officers and directors; and




·
            all
                our officers and directors as a
                group.




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




Name
                and Address of Beneficial Holder (1)
            
            Amount
                of Beneficial Ownership
            
            Percentage
                of Outstanding
              Ordinary
              SharesHBK
                Investments L.P.
            
            
            785,000
            (2)
            
            9.9
            %Millenco
                LLC
            
            
            716,500
            (3)
            
            9.0
            %The
                Baupost Group, L.L.C.
            
            
            675,000
            (4)
            
            8.5
            %Polar
                Securities Inc.
            
            
            579,000
            (5)
            
            7.3
            %Barry
                J. Gordon
            
            
            468,851
            (6)
            
            5.9
            %Marc
                H. Klee
            
            
            364,662
            (7)
            
            4.6
            %Robert
                Sroka
            
            
            206,472
            (8)
            
            2.6
            %Arthur
                H. Goldberg
            
            
            206,472
            (8)
            
            2.6
            %Alan
                J. Loewenstein
            
            
            135,320
            (9)
            
            1.7
            %All
                directors and executive officers as a group (five
                individuals)
            
            
            1,381,777
            (10)
            
            17.4
            %







*
      Less
      than 1%.




(1)
            Unless
                otherwise indicated, the business address of each of the individuals
                is
                175 Great Neck Road, Suite 204, Great Neck, New York
                11201-3313.




(2)
            Represents
                785,000 shares of common stock over which HBK Investments L.P., HBK
                Services LLC (“Services”), HBK Partners II L.P. HBK Management LLC and HBK
                Master Fund L.P. each have shared voting and dispositive power. HBK
                Investments L.P. has delegated discretion to vote and dispose of
                the
                securities to Services. Services may, from time to time, delegate
                discretion to vote and dispose of certain of the securities to HBK
                New
                York LLC, HBK Virginia LLC, HBK Europe Management LLP and/or HBK
                Hong Kong
                Ltd. (collectively, the “Subadvisors”). Each of Services and the
                Subadvisors is under common control with HBK Investments L.P. This
                amount
                does not include 340,000 warrants to purchase shares of common stock,
                which are not exercisable and will not become exercisable within
                60 days.
                The business address for each entity is 300 Crescent Court, Suite
                700,
                Dallas, Texas 75201. The foregoing information was derived from a
                Schedule
                13G filed with the SEC on December 21, 2007, as amended on February
                8,
                2008.




(3)
            Represents
                716,500 units held by Millenco LLC. Each unit consists of one share
                of
                common stock and one warrant to purchase one share of common stock.
                The
                warrants are not exercisable and will not become exersiable within
                60
                days. Millenium Management LLC is the manager of Millenco LLC and
                Israel
                A. Englander is the managing member of Millenium Management LLC.
                Each may
                be deemed to have shared voting control and investment discretion
                over the
                securities. The business address of Mr. Englander and each of the
                entities
                is 666 Fifth Avenue, New York, New York 10103. The foregoing information
                is derived from a Schedule 13G filed with the Securities and Exchange
                Commission on December 17, 2007.









(4)
            Represents
                675,000 shares of common stock over which The Baupost Group, L.L.C.
                (“Baupost”), a registered investment adviser, has sole voting and
                dispositive power. SAK Corporation, as the Manager of Baupost, and
                Seth A.
                Klarman, as the sole Director of SAK Corporation and a controlling
                person
                of Baupost, may be deemed to have beneficial ownership of all the
                securities. The business address of Mr. Klarman and each of the entities
                is 10 St. James Avenue, Suite 1700, Boston, Massachusetts 02116.
                The
                foregoing information is derived from a Schedule 13G filed with the
                Securities and Exchange Commission on February 13,
                2008.




(5)
            Represents
                (i) 379,000 shares of common stock held by North Pole Capital Master
                Fund
                (“North Pole”) and (ii) 200,000 shares of common stock held in certain
                discretionary accounts (“Accounts”). Polar Securities Inc. (“Polar
                Securities”) serves as the investment manager for North Pole and the
                Accounts. The business address for North Pole and Polar Securities
                is 372
                Bay Street, 21stFloor, Toronto, Canada A6 MSH 2S6. The foregoing information is derived
                from a Schedule 13G filed with the Securities and Exchange Commission
                on
                March 3, 2008.




(6)
            Does
                not include 472,320 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




(7)
            Does
                not include 367,360 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




(8)
            Does
                not include 208,000 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




(9)
            Does
                not include 136,320 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




(10)
            Does
                not include 1,392,000 shares of common stock issuable upon exercise
                of
                insider warrants that are not exercisable and will not become exercisable
                within 60 days.




Our
      founders, which include all of our officers and directors, collectively,
      beneficially own 20% of the issued and outstanding shares of our common stock.
      Because of the ownership block held by our founders, such individuals may be
      able to effectively exercise control over all matters requiring approval by
      our
      stockholders, including the election of directors and approval of significant
      corporate transactions other than approval of our initial business
      combination.




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, 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). 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 founders’ shares.









Messrs.
      Gordon, Klee, Sroka, Goldberg and Granat are our “promoters,” as that term is
      defined under the Federal securities laws.




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




**Certain
      Relationships and Related Transactions**




In
      June
      2007, we issued 1,250,000 ordinary shares to the individuals set forth below
      for
      $25,000 in cash, at a purchase price of $0.02 per share, as
      follows:




Name
            
            Number
                of
              Shares
            
            Relationship
                to UsBarry
                J. Gordon
            
            
            369,000
            
            
            Chairman
                and Chief Executive OfficerMarc
                H. Klee
            
            
            287,000
            
            
            President,
                Chief Financial Officer, Secretary and DirectorRobert
                Sroka
            
            
            162,500
            
            
            DirectorArthur
                H. Goldberg
            
            
            162,500
            
            
            DirectorHarvey
                Granat
            
            
            162,500
            
            
            StockholderAlan
                J. Loewenstein
            
            
            106,500
            
            
            Vice
                President




Effective
      September 18, 2007 and November 30, 2007, our board of directors authorized
      a
      stock dividend of 0.38 and 0.05 shares of common stock, respectively, for each
      outstanding share of common stock, effectively lowering the purchase price
      to
      approximately $0.01 per share.




On
      January 11, 2008, we consummated the offering of 53,000 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
      an aggregate of 222,551 founders’ shares were canceled to maintain our founders’
ownership in our common stock at 20%.




The
      holders of the majority of these shares will be entitled to make up to two
      demands that we register these shares. The holders of the majority of these
      shares may elect to exercise these registration rights at any time commencing
      three months prior to the date on which these shares of common stock are
      released from escrow. In addition, these stockholders have certain “piggy-back”
registration rights with respect to registration statements filed 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.









Barry
      J.
      Gordon, Marc H. Klee, Alan J. Loewenstein, Robert Sroka, Arthur H. Goldberg
      and
      Harvey Granat have committed, purchased an aggregate of 1,600,000 insider
      warrants (for a total purchase price of $1,600,000) from us. These purchases
      took place on a private placement basis simultaneously with the consummation
      of
      our IPO. The insider warrants are identical to the warrants underlying the
      units
      offered in our IPO except that if we call the warrants for redemption, the
      insider 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 insider warrants will not be sold or transferred by them until
      after we have completed a business combination. The holders of the majority
      of
      these insider warrants (or underlying shares) will be entitled to demand that
      we
      register these securities. 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.




Commencing
      on November 30, 2007, American Fund Advisors, an affiliate of Barry J. Gordon,
      Marc H. Klee and Alan J. Loewenstein, has made available to us a small amount
      of
      office space and certain office and secretarial services, as we may require
      from
      time to time. We have agreed to pay American Fund Advisors $8,000 per month
      for
      these services. Mr. Gordon is chairman of American Fund Advisors, Mr. Klee
      is
      executive vice president of American Fund Advisors and Mr. Loewenstein is senior
      vice president of American Fund Advisors. Accordingly, Messrs. Gordon, Klee
      and
      Loewenstein will benefit from the transaction to the extent of their interests
      in American Fund Advisors. However, this arrangement is solely for our benefit
      and is not intended to provide Messrs. Gordon, Klee and Loewenstein compensation
      in lieu of a salary. We believe, based on rents and fees for similar services
      in
      the New York metropolitan area, that the fee charged by American Fund Advisors
      is at least as favorable as we could have obtained from an unaffiliated party.
      However, as our directors may not be deemed “independent,” we did not have the
      benefit of disinterested directors approving this transaction.




Prior
      to
      our IPO, Barry J. Gordon and Arthur H. Goldberg advanced to us an aggregate
      of
      $100,000 to cover expenses related to the offering. The loans were repaid
      without interest from the proceeds of our 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 the $8,000 per-month administrative fee and 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 founders, or to any of their respective affiliates,
      prior to or with respect to the business combination (regardless of the type
      of
      transaction).




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.









**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 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. While we have agreed not to consummate a business combination with
      an
      entity which is affiliated with any of our officers, directors or founders,
      we
      are not prohibited from entering into other related-party transactions.





Our
      board
      of directors is responsible for reviewing and approving related-party
      transactions to the extent we enter into such transactions. The board of
      directors 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 other members of the board of directors with all
      material information concerning the transaction. Additionally, we require each
      of our directors and executive officers to complete a directors’ and officers’
questionnaire that elicits information about related party transactions. 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**




Currently,
      only Robert Sroka and Arthur H. Goldberg would be considered “independent” as
      that term is commonly used. In connection with a proposed business combination,
      we anticipate applying to have our securities listed on a national securities
      exchange. At that time, we will adhere to the rules of whatever exchange we
      seek
      to have our securities listed on.




**ITEM
      13. EXHIBITS**




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





Exhibit
                No.
            
            Description3.1
            
            Amended
                and Restated Certificate of Incorporation.*3.2
            
            By-laws.*4.1
            
            Specimen
                Unit Certificate.*










4.2
            
            Specimen
                Common Stock Certificate.*4.3
            
            Specimen
                Warrant Certificate.*4.4
            
            Form
                of Unit Purchase Option granted to Representative.*4.5
            
            Form
                of Warrant Agreement between Continental Stock Transfer & Trust
                Company and the Registrant.*10.1
            
            Letter
                Agreement among the Registrant, EarlyBirdCapital, Inc. and Barry
                J.
                Gordon.*10.2
            
            Letter
                Agreement among the Registrant, EarlyBirdCapital, Inc. and Marc H.
                Klee.*10.3
            
            Letter
                Agreement among the Registrant, EarlyBirdCapital, Inc. and Alan J.
                Loewenstein.*10.4
            
            Letter
                Agreement among the Registrant, EarlyBirdCapital, Inc. and Robert
                Sroka.*10.5
            
            Letter
                Agreement among the Registrant, EarlyBirdCapital, Inc. and Arthur
                H.
                Goldberg.*10.6
            
            Letter
                Agreement among the Registrant, EarlyBirdCapital, Inc. and Harvey
                Granat.*10.7
            
            Form
                of Investment Management Trust Agreement between Continental Stock
                Transfer & Trust Company and the Registrant.*10.8
            
            Form
                of Stock Escrow Agreement between the Registrant, Continental Stock
                Transfer & Trust Company and the Initial
                Stockholders.*10.9
            
            Form
                of Administrative Services Agreement between the Registrant and American
                Fund Advisors, Inc.*10.10
            
            Promissory
                Note issued to Barry J. Gordon.*10.11
            
            Form
                of Registration Rights Agreement among the Registrant and the Initial
                Stockholders.*10.12
            
            Form
                of Subscription Agreements among the Registrant, Graubard Miller
                and each
                of Barry J. Gordon, Marc H. Klee, Alan J. Loewenstein, Robert Sroka,
                Arthur H. Goldberg and Harvey Granat.*31.1
            
            Certification
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002.31.2
            
            Certification
                of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002.32
            
            Certification
                of Chief Executive Officer and Chief Financial Officer pursuant to
                Section
                906 of the Sarbanes-Oxley Act of 2002.*
            
            Incorporated
                by reference to the Registrant’s Registration Statement on Form S-1 (SEC
                File No. 333-145278).









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




The
      firm
      of Rothstein, Kass & Company, P.C. acts as our principal accountant. The
      following is a summary of fees paid to our principal accountant for services
      rendered.




**Audit
      Fees**




During
      the year ended December 31, 2007, we paid our principal accountant $50,000
      for
      the services they performed in connection with our Registration Statement on
      Form S-1 related to our initial public offering, including the financial
      statements included in the Current Report on Form 8-K filed with the Securities
      and Exchange Commission on December 12, 2007, and $5,000 in connection with
      the
      review of our Quarterly Report on Form 10-QSB. The fee for the audit of the
      financial statements included in this Annual Report on Form 10-KSB for the
      fiscal year ended December 31, 2007 is approximately $20,000. The aggregate
      of
      such fees is $75,000.




**Audit-Related
      Fees**




During
      2007, our principal accountant did not render assurance and related services
      reasonably related to the performance of the audit or review of financial
      statements.




**Tax
      Fees**




During
      2007, our principal accountant did not render 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 the
      principal accountant other than those set forth above.




**Audit
      Committee Approval**




As
      we do
      not have an audit committee, the audit committee did not pre-approve any
      accounting-related or tax services. However, our board of directors has approved
      the services described above.







**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 20th day of
      March, 2008.




**NORTH
                  SHORE ACQUISITION CORP.**By:
              /s/
                  Barry J. GordonBarry
                  J. GordonChairman
                  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/
                    Barry J. Gordon
                
                Chairman
                    of the Board and Chief Executive
                
                March
                    20, 2008Barry
                    J. Gordon
                
                Officer(Principal
                    Executive Officer)/s/
                    Marc H. Klee
                
                President,
                    Chief Financial Officer, Secretary
                
                March
                    20, 2008Marc
                    H. Klee
                
                and
                    Director(Principal
                    Accounting and Financial Officer)/s/
                    Arthur H. Goldberg
                
                Director
                
                March
                    20, 2008Arthur
                    H. Goldberg/s/
                    Robert Sroka
                
                Director
                
                March
                    20, 2008Robert
                    Sroka









**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**INDEX
      TO FINANCIAL STATEMENTS**




**Report
                of Independent Registered Public Accounting Firm**
            
            F-2**Financial
                Statements**Balance
                Sheet
            
            F-3Statement
                of Operations
            
            F-4Statement
                of Changes in Stockholders’ Equity
            
            F-5Statement
                of Cash Flows
            
            F-6**Notes
                to Financial Statements**
            
            F-7 - F-15


F-1




**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**




To
      the
      Board of Directors and Stockholders


North
      Shore Acquisition Corp.





We
      have
      audited the accompanying balance sheet of North Shore Acquisition Corp. (a
      corporation in the development stage) (the “Company”) as of December 31, 2007
      and the related statements of operations, changes in stockholders’ equity and
      cash flows for the period from June 26, 2007 (date of 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 North Shore Acquisition Corp.
      (a
      corporation in the development stage) as of December 31, 2007, and the results
      of its operations and its cash flows for the period from June 26, 2007 (date
      of
      inception) to December 31, 2007, in conformity with accounting principles
      generally accepted in the United States of America.





/s/
      Rothstein Kass & Company, P.C.


Roseland,
      New Jersey


March
      20,
      2008


F-2


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**BALANCE
      SHEET**




December 31,2007**ASSETS****Current
                assets:**Cash
            
            $
            107,863Prepaid
                expenses and other current assets
            
            
            92,461**Total
                current assets**
            
            
            200,324Other
                asset, cash held in Trust Fund (Note 1)
            
            
            49,411,768**Total
                assets**
            
            $
            49,612,092**LIABILITIES
                AND STOCKHOLDERS' EQUITY****Current
                liabilities:**Income
                taxes payable
            
            $
            54,500Accrued
                expenses
            
            
            17,500Accounts
                payable
            
            
            15,740**Total
                current liabilities**
            
            
            87,740**Long-term
                liabilities**Deferred
                underwriters' fee
            
            
            1,512,000Commons
                stock, subject to possible redemption, 2,519,999 shares at redemption
                value
            
            
            19,713,599**Commitments
                and Contingencies****Stockholders’
                equity**Preferred
                stock, $.0001 par valueAuthorized
                1,000,000 shares; none issued and outstandingCommon
                stock, $.0001 par valueAuthorized
                20,000,000 sharesIssued
                and outstanding 8,111,250 shares (which includes 2,519,999 subject
                to
                possible redemption)
            
            
            811Additional
                Paid in Capital
            
            
            28,273,076Retained
                earnings during the development stage
            
            
            24,866Total
                stockholders' equity
            
            
            28,353,253Total
                liabilities and stockholders' equity
            
            $
            49,612,092





*The
      accompanying notes are an integral part of the financial
      statements.*


F-3


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**STATEMENT
      OF OPERATIONS**





Period from26-Jun-07(date of inception) to31-Dec-07Revenue
            
            $
            —Formation
                and operating expenses
            
            
            49,529Loss
                from operations
            
            
            (49,529
            )Other
                income, interest
            
            
            128,895Income
                before income tax expense
            
            
            79,365Income
                tax expense
            
            
            54,500Net
                income applicable to common stockholders
            
            $
            24,866Weighted
                average shares outstandingBasic
            
            
            2,644,583Diluted
            
            
            2,943,147Net
                income per share, basic
            
            $
            0.01Net
                income per share, diluted
            
            $
            0.01





*The
      accompanying notes are an integral part of the financial
      statements.*


F-4


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**STATEMENT
      OF CHANGES IN STOCKHOLDERS’ EQUITY**




*For
      the period June 26, 2007 (date of inception) to December 31, 2007*





RetainedEarningsAdditional
            
            accumulatedCommon
            
            Stock
            
            Paid-In
            
            during theShares
            
            Amount
            
            Capital
            
            development
              stage
            
            TotalSale
                of 1,811,250 shares of common stock to initial stockholders on June
                26,
                2007
            
            
            1,811,250
            
            $
            181
            
            $
            24,819
            
            $
            —
            
            $
            25,000Sale
                of 6,300,000 units, net of underwriters' discount and offering expenses
                (includes 2,519,999 shares subject to possible redemption) on November
                30,
                2007
            
            
            6,300,000
            
            
            630
            
            
            46,361,757
            
            
            —
            
            
            46,362,387Proceeds
                subject to possible redemption of 2,519,999 shares
            
            
            —
            
            
            
            
            
            (19,713,599
            )
            
            —
            
            
            (19,713,599
            )Proceeds
                from the public offering from sale of warrants to initial stockholderson
                November 30, 2007
            
            
            —
            
            
            —
            
            
            1,600,000
            
            
            —
            
            
            1,600,000Proceeds
                from the public offering from issuance of option on November 30,
                2007
            
            
            —
            
            
            —
            
            
            100
            
            
            —
            
            
            100Net
                income for the period
            
            
            
            
            
            —
            
            
            —
            
            
            24,866
            
            
            24,866Balance,
                December 31, 2007
            
            
            8,111,250
            
            $
            811
            
            $
            28,273,077
            
            $
            24,866
            
            $
            28,353,253





*The
      accompanying notes are an integral part of the financial
      statements.*


F-5


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**STATEMENT
      OF CASH FLOWS**








*For
                the period June 26, 2007 (date of
                inception) to December 31, 2007***Cash
                Flows from Operating Activities**Net
                income
            
            $
            24,866Adjustment
                to reconcile net income to net cash provided by operating
                activitiesIncrease
                in prepaid expenses and other current assets
            
            
            (92,461
            )Increase
                in income taxes payable
            
            
            54,500Increase
                in accrued expenses
            
            
            17,500Increase
                in accounts payable
            
            
            15,740Net
                cash provided by operating activities
            
            
            20,145**Net
                cash used in Investing Activities**Change
                in cash held in Trust Fund
            
            
            (49,411,768
            )**Cash
                Flows from Financing Activities**Gross
                proceeds of common stock public offering
            
            
            50,400,000Proceeds
                from notes payable, shareholder
            
            
            100,000Payment
                of notes payable, shareholder
            
            
            (100,000
            )Proceeds
                from the issuance of common stock to initial stockholders
            
            
            25,000Proceeds
                from sale of warrants to initial shareholders
            
            
            1,600,000Proceeds
                from issuance of option
            
            
            100Payment
                of costs of public offering
            
            
            (2,525,614
            )Net
                cash provided by financing activities
            
            
            49,499,486Net
                increase in cash
            
            
            107,863Cash
                at the beginning of the period
            
            
            —Cash
                at the end of the period
            
            $
            107,863Non
                cash financing activity:Deferred
                underwriter's fee
            
            $
            1,512,000





*The
      accompanying notes are an integral part of the financial
      statements.*


F-6


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**Notes
      to Financial Statements**




**1.**
            **Organization**
              **and**
              **Business**
              **Operations**
            North
                Shore Acquisition Corp. (the “Company”) was incorporated in Delaware on
                June 26, 2007 as a blank check company whose objective is to acquire
                an
                operating business.
              
              All
                activity from June 26, 2007 (inception) through December 31, 2007
                relates
                to the Company’s formation and initial public offering described below.
                The Company has selected December 31 as its fiscal
                year-end.The
                registration statement for the Company’s initial public offering
                (“Offering”) was declared effective November 30, 2007. The Company
                consummated the offering on December 7, 2007 and received net proceeds
                of
                approximately $47,883,000 (Note 3). 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 effect a Business Combination. An amount of $47,684,000
                of
                the net proceeds (not including the $1,600,000 investment by the
                Initial
                Stockholders - see Note 5) is being held in an interest-bearing trust
                account (“Trust Account”) including a portion of the underwriting
                discounts and commissions payable to the underwriters in this offering
                and
                invested 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 2(a)(7) promulgated under the Investment Company
                Act
                of 1940,until the earlier of (i) the consummation of a Business
                Combination or (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,
                prospective target businesses or other entities it engages, 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 that they will execute such agreements. The Company’s officers
                and directors have agreed that they will be personally liable under
                certain circumstances to ensure that the proceeds in the Trust Account
                are
                not reduced by the claims of target businesses or vendors or other
                entities that are owed money by the Company for services rendered
                contracted for or products sold to the Company. However, there can
                be no
                assurance that they will be able to satisfy those obligations. 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 $1,000,000 of interest earned
                on the
                Trust Account balance may be released to the Company to fund working
                capital requirements, as well as any amounts necessary to pay the
                Company’s tax obligations. At December 31, 2007, the Company earned
                $127,767 of interest on the Trust Account, which is included in the
                cash
                held in Trust Fund of the balance
                sheet.


F-7


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**Notes
      to Financial Statements—(Continued)**





The
                Company, after signing a definitive agreement for the acquisition
                of a
                target business, will submit such transaction for stockholder approval.
                In
                the event that stockholders owning 40% or more of the shares sold
                in the
                Offering vote against the Business Combination and exercise their
                conversion rights described below, the Business Combination will
                not be
                consummated.All
                of the Company’s stockholders prior to the Offering, including all of the
                officers and directors of the Company (“Initial Stockholders”), have
                agreed to vote their 1,811,250 founding shares of common stock in
                accordance with the vote of the majority in interest of all other
                stockholders of the Company (“Public Stockholders”) with respect to any
                Business Combination. After consummation of a Business Combination,
                these
                voting safeguards will no longer be
                applicable.


F-8


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**Notes
      to Financial Statements—(Continued)**


With
                respect to a Business Combination which is approved and consummated,
                any
                Public Stockholder who voted against the Business Combination may
                demand
                that the Company convert his shares. The per share conversion price
                will
                equal the amount in the Trust Account, calculated as of two business
                days
                prior to the consummation of the proposed Business Combination, divided
                by
                the number of shares of common stock held by Public Stockholders
                at the
                consummation of the Offering. Accordingly, Public Stockholders holding
                39.99% of the aggregate number of shares owned by all Public Stockholders
                may seek conversion of their shares in the event of a Business
                Combination. Such Public Stockholders are entitled to receive their
                per
                share interest in the Trust Account computed without regard to the
                shares
                held by Initial Stockholders. Accordingly, a portion of the net proceeds
                from the offering (39.99% of the amount held in the Trust Account)
                has
                been classified as common stock subject to possible conversion in
                the
                accompanying December 31, 2007 balance sheet.
              
              The
                Company’s Amended and Restated Certificate of Incorporation provides for
                mandatory liquidation of the Company in the event that the Company
                does
                not consummate a Business Combination by November 30, 2009. In the
                event
                of liquidation, it is possible that the per share value of the residual
                assets remaining available for distribution (including Trust Account
                assets) will be less than the initial public offering price per share
                in
                the Offering due to costs related to the Offering and since no value
                would
                be attributed to the Warrants contained in the Units sold
                (Note 3).





**2.**
            **Summary of**
              **Significant**
              **Accounting Policies**
            ***Basis
                of Presentation***
              
              The
                financial statements of the Company are presented in U.S. dollars
                in
                conformity with accountingprinciples
                generally accepted in the United States of America (U.S.
                GAAP).
              
              ***Development
                Stage Company***
              
              The
                Company complies with the reporting requirements of SFAS No. 7,
                "Accounting and Reporting by Development Stage Enterprises."
              
              ***Concentration
                of Credit Risk***
              
              Financial
                instruments that potentially subject the Company to a significant
                concentration of credit risk consist primarily of cash. The Company
                may
                maintain deposits in federally insured financial institutions inexcess
                of federally insured limits. However, management believes the Company
                is
                not exposed to significantcredit
                risk due to the financial position of the depository institutions
                in which
                those deposits are held.


F-9


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**Notes
      to Financial Statements—(Continued)**




***Fair
                Value of Financial Instruments***
              
              The
                fair values of the Company's assets and liabilities that qualify
                as
                financial instruments underSFAS
                No. 107, "Disclosures about Fair Value of Financial Instrument,"
                approximate their carrying amountspresented
                in the accompanying balance sheet.
              
              ***Basic
                and Diluted Earnings******per
                Share***
              
              Earnings
                per common share is based on the weighted average number of common
                shares
                outstanding. The Company complies with SFAS No. 128, "Earnings Per
                Share,"
                which requires dual presentation of basic and diluted earnings per
                share
                on the face of the statement of operations. Basic 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. Diluted income per share reflects the potential dilution
                that
                could occur if warrants were to be exercised or otherwise resulted
                in the
                issuance of common stock that then shared in the earnings of the
                entity.
              
              The
                  Company's statements of operations include a presentation of earnings
                  per
                  share for common stock subject to possible conversion in a manner
                  similar
                  to the two-class method of earnings per share in accordance with
                  Emerging
                  Issue Task Force Abstracts, Topic No. D-98 "Classification and
                  Measurement of Redeemable Securities.” Basic and diluted net income per
                  share amounts for the maximum number of shares subject to possible
                  conversion are calculated by dividing the net interest income attributable
                  to common shares subject to conversion by the weighted average
                  number of
                  shares subject to possible conversion. For the period from June
                  26, 2007
                  (date of inception) to December 31, 2007, no interest income was
                  earned on
                  common shares subject to conversion.
              
              ***Use
                of Estimates***
              
              The
                preparation of financial statements in conformity with accounting
                principles generally accepted in theUnited
                States of America requires management to make estimates and assumptions
                that affect the reported amounts of assets and liabilities and disclosure
                of contingent assets and liabilities at the date of the financial
                statements and the reported amounts of expenses during the reporting
                period. Actual results could differ fromthose
                estimates.
              
              ***Income
                Taxes***
              
              The
                Company complies with the Financial Accounting Standards Board (“FASB”)
                issued FASB Interpretation No. 48, “Accounting
                for Uncertainty in Income Taxes,” an interpretation of FASB Statement No.
                109 (“FIN 48”), which provides criteria for the recognition, measurement,
                presentation and disclosure ofuncertain
                tax position. A tax benefit from an uncertain position may be recognized
                only if it is "more likelythan
                not" that the position is sustainable based on its technical
                merits.
              
              The
                Company complies with SFAS 109, “Accounting for Income Taxes,” which
                requires an asset and liability approach to financial accounting
                and
                reporting for income taxes. Deferred income taxes are provided for
                the
                differences between the bases of assets and liabilities forfinancial
                reporting and income tax purposes. A valuation allowance is established
                when necessary to reducedeferred
                tax assets to the amount expected to be realized.
              
              ***New
                Accounting Pronouncements***
              
              In
                December 2007, the FASB issued SFAS 141(R), “Business Combinations”. SFAS
                141(R) provides companies with principles and requirements on how
                an
                acquirer recognizes and measures in its financial statements the
                identifiable assets acquired, liabilities assumed, and any noncontrolling
                interest in the acquiree as well as the recognition and measurement
                of
                goodwill acquired in a business combination. SFAS 141(R) also requires
                certain disclosures to enable users of the financial statements to
                evaluate the nature and financial effects of the business combination.
                Acquisition costs associated with the business combination will generally
                be expensed as incurred. SFAS 141(R) is effective for business
                combinations occurring in fiscal years beginning after December 15,
                2008,
                which will require the Company to adopt these provisions for business
                combinations occurring in fiscal 2009 and thereafter. Early adoption
                of
                SFAS 141(R) is not permitted.


F-10





**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**Notes
      to Financial Statements—(Continued)**





Management
                does not believe that any other recently issued, but not yet effective,
                accounting pronouncements, if currently adopted, would have a material
                effect on the Company’s financial statements.
              
              ***Redeemable
                common stock***
              
              The
                Company accounts for redeemable common stock in accordance with Emerging
                Issue Task Force D-98 “Classification and Measurement of Redeemable
                Securities”. Securities that are redeemable for cash or other assets are
                classified outside of permanent equity if they are redeemable at
                the
                option of the holder. In addition, if the redemption causes a redemption
                event, the redeemable securities should not be classified outside
                of
                permanent equity. As discussed in Note 1, the Business Combination
                will
                only be consummated 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 holding less than 40% (2,519,999) of common shares
                sold in the Offering exercise their conversion rights. As further
                discussed in Note 1, if a Business Combination is not consummated
                within
                24 months, the Company will liquidate. Accordingly, 2,519,999 shares
                have
                been classified outside of permanent equity at redemption value.
                The
                Company recognized changes in the redemption value immediately as
                they
                occur and adjusts the carrying value of the redeemable common stock
                to
                equal its redemption value at the end of each reporting period. The
                per
                share redemption price was approximately $7.82 at December 31,
                2007.**3.**
            **Initial
                Public**
              **Offering**
            On
                December 7, 2007, the Company sold 6,300,000 units (“Units”) in the
                Offering. Each Unit consists of one share of the Company’s common stock,
                $.0001 par value, and one Redeemable Common Stock Purchase Warrant(s)
                (“Warrants”). Each Warrant entitles the holder to purchase from the
                Company one share of common stock at an exercise price of $5.00 commencing
                the later of six months after the completion of a Business Combination
                or****November
                30, 2008 and expiring November 29, 2012.****The Warrants will be redeemable, at the Company’s option, with the prior
                consent of EarlyBirdCapital, Inc., the representative of the underwriters
                in the Offering (“Underwriters”), at a price of $.01 per Warrant upon 30
                days’ notice after the Warrants become exercisable, only in the event that
                the last sale price of the common stock is at least $11.50 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. If the
                Company
                redeems the Warrants as described above, management will have the
                option
                to require any holder that wishes to exercise his Warrant to do so
                on a
                “cashless basis.” In such event, the holder would pay the exercise price
                by surrendering his Warrants for that number of shares of Common
                Stock
                equal to the quotient obtained by dividing (x) the product of the
                number
                of shares of Common Stock underlying the Warrants, multiplied by
                the
                difference between the exercise price of the Warrants and the “fair market
                value” (defined below) by (y) the fair market value. The “fair market
                value” shall mean the average reported last sale price of the Common Stock
                for the 10 trading days ending on the third trading day prior to
                the date
                on which the notice of redemption is sent to holders of Warrants.
                In
                accordance with the warrant agreement relating to the Warrants to
                be sold
                and issued in the Proposed 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.


F-11


**North
      Shore Acquisition Corp.**


**(a
      corporation in the development stage)**


**Notes
      to Financial Statements—(Continued)**





The
                Company agreed to pay the Underwriter in the Offering an underwriting
                discount of 6.5% of the gross proceeds of the Offering and a
                non-accountable expense allowance of 0.5% of the gross proceeds of
                the
                Offering. However, the Underwriter has agreed that 3.0% of the
                underwriting discount will not be payable unless and until the Company
                completes a Business Combination and has waived their right to receive
                such payment upon the Company's liquidation if it is unable to complete
                a
                Business Combination. In connection with this Offering, the Company
                also
                issued an option (“Option”), for $100, to the Underwriter to purchase
                420,000 Units at an exercise price of $8.80 per Unit. The Units issuable
                upon exercise of the Option are identical to the Units sold in the
                Offering. The Company intends to account for the fair value of the
                Option,
                inclusive of the receipt of the $100 cash payment, as an expense
                of the
                Offering resulting in a charge directly to stockholders’ equity. The
                Company estimates that the fair value of the Option is approximately
                $823,200 ($1.96 per Unit) using a Black-Scholes option-pricing model.
                The
                fair value of the Option granted to the Underwriter is estimated
                as of the
                date of grant using the following assumptions: (1) expected volatility
                of
                20.43%, (2) risk-free interest rate of 4.82% and (3) expected life
                of 5
                years. The Option may be exercised for cash or on a "cashless" basis,
                at
                the holder's option, such that the holder may use the appreciated
                value of
                the Option (the difference between the exercise prices of the Option
                and
                the underlying Warrants and the market price of the Units and underlying
                securities) to exercise the option without the payment of any cash.
                The
                Company will have no obligation to net cash settle the exercise of
                the
                unit purchase option or the Warrants underlying the unit purchase
                option.
                The holder of the unit purchase option will not be entitled to exercise
                the unit purchase option or the Warrants underlying the unit purchase
                option unless a registration statement covering the securities underlying
                the unit purchase option is effective or an exemption from registration
                is
                available. If the holder is unable to exercise the Option or underlying
                Warrants, the Option or Warrants, as applicable, will expire
                worthless.


F-12


**North
        Shore Acquisition Corp.**
 **(a
        corporation in the development stage)**
 **Notes
        to Financial Statements—(Continued)**
 
 **4.**
              **Note Payable,**
                **Stockholder**
              The
                  Company issued a $75,000 unsecured promissory note to the Company’s
                  Chairman of the Board and Chief Executive Officer on July 10, 2007,
                  and a
                  $25,000 unsecured promissory note to one of the Company’s Directors on
                  August 20, 2007. The notes were non interest-bearing and were paid
                  off prior to December 31, 2007.**5.**
              **Income
                  Taxes**
              The
                  current tax provision is comprised of the following for the period
                  from
                  June 26, 2007 (inception) to December 31, 2007:
 
 Federal
              
              $
              20,500State
              
              
              34,000$
              54,500
 
 The
                  Company has not begun its trade or business for U.S. tax purposes.
                  Accordingly, it could not yetrecognize
                  losses for expenditures. As a result a deferred tax asset of approximately
                  $20,000 was established forthe
                  book loss recorded as well as a fully offsetting valuation
                  allowance.
                
                The
                  reconciliation of the effective tax rate to the statutory tax rate
                  due for
                  the period from June 26, 2007 (inception) to December 31, 2007
                  is
                  presented as follows:
 
 Computed
                  expected tax expense
              
              
              34.0
              %Less:
                  Formation costs
              
              
              61.9Less:
                  State taxes, net of federal benefit
              
              
              (27.8
              )Effective
                  tax rate
              
              
              68.1
              %
  F-13
  **North
        Shore Acquisition Corp.**
 **(a
        corporation in the development stage)**
 **Notes
        to Financial Statements—(Continued)**
 
 **6.**
              **Commitments**
              The
                  Company presently occupies office space provided by an affiliate
                  of the
                  Company’s Chairman of the Board, President, and Vice President. 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. The Company has agreed to pay such affiliate
                  $8,000 per month for such services commencing on the effective
                  date of the
                  Proposed Offering.
                
                Pursuant
                  to letter agreements with the Company and the Underwriter, the
                  Initial
                  Stockholders have waived their right to receive distributions with
                  respect
                  to their founding shares upon the Company's liquidation.
                
                All
                  of the Initial Stockholders purchased 1,600,000 Warrants (“Insider
                  Warrants”) at $1.00 per Warrant (for an aggregate purchase price of
                  $1,600,000) privately from the Company upon consummation of the
                  Offering.
                  All of the proceeds received from these purchases were placed in
                  the Trust
                  Account. The Insider Warrants are identical to the Warrants underlying
                  the
                  Units being offered in the Proposed Offering except that if the
                  Company
                  calls the Warrants for redemption, the Insider Warrants may be
                  exercisable
                  on a “cashless basis,” at the holder’s option (except in the case of a
                  forced cashless exercise upon the Company’s redemption of the Warrants, as
                  described above), so long as such securities are held by such purchasers
                  or their affiliates. Furthermore, the purchasers have agreed that
                  the
                  Insider Warrants will not be sold or transferred by them until
                  after the
                  Company has completed a Business Combination.
                
                The
                  Initial Stockholders and 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),
                  as the
                  case may be, pursuant to an agreement dated November 30, 2007.
                  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 such 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.
  F-14
  **North
        Shore Acquisition Corp.**
 **(a
        corporation in the development stage)**
 **Notes
        to Financial Statements—(Continued)**
 
 **7.**
              **Basic and Diluted**
                **Earnings Per Share**
              The
                  following is a reconciliation of the denominator of the basic and
                  diluted
                  earnings per share for the period from June 26, 2007 (inception)
                  to
                  December 31, 2007.
 
 Weighted
                  average number of common shares outstanding:
              
              
              2,644,583Dilutive
                  potential common shares outstanding from warrants
              
              
              298,564Diluted
                  weighted average shares
              
              
              2,943,147
 
 **8.**
              **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.
                
                The
                  agreement with the underwriters prohibits 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.
 
 **9.**
              **Common
                  Stock**
              At
                  December 31, 2007, 8,740,000 shares of common stock were reserved
                  for
                  issuance upon exercise of the Warrants and the
                  Option.
  F-15