Forward- Looking Statements

We believe that some of the information in this annual report constitutes forward-looking statements. You can identify these statements by forward-looking words such as "may," "expect," "anticipate," "contemplate," "believe," "estimate," "intends," and "continue" or similar words. You should read statements that contain these words carefully because they:

· discuss future expectations;

· contain projections of future results of operations or financial condition; and

· state other "forward-looking" information.

We believe it is important to communicate our expectations to our shareholders. However, there may be events in the future that we are not able to accurately predict or over which we have no control. The risk factors and cautionary language discussed in this annual report provide examples of risks, uncertainties and events that may cause actual results to differ materially from the expectations described by us in our forward-looking statements, including among other things:

· changing interpretations of GAAP;

· the general volatility of the market price of our securities;

· the availability of qualified personnel;

· the ability of Columbus to consummate the Merger and related transactions within the expected timeframe;

· changes in interest rates or the debt securities markets;

· outcomes of government reviews, inquiries, investigations and related litigation;

· continued compliance with government regulations;

· legislation or regulatory environments, requirements or changes adversely affecting the businesses in which IDE is engaged;

· statements about industry trends;

· general economic conditions; and

· geopolitical events and regulatory changes.

We caution you to not to place undue reliance on these forward-looking statements, which speak only as of the date of this annual report.

All forward-looking statements included herein attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We have based the forward-looking statements included in this annual report on information available to us on the date of this annual report and, except to the extent required by applicable laws and regulations, we undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this annual report or to reflect the occurrence of unanticipated events. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we make directly to you or through reports that we in the future may file with the Securities and Exchange Commission, including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. Our actual results could differ materially from those expressed or implied by the forward looking statements as a result of various factors including, but not limited to, those presented under "Risk Factors" included in Item 1A and elsewhere in this annual report.

Overview

We are a blank check company incorporated in Delaware on August 1, 2006 to serve as a vehicle to effect a Merger, capital stock exchange, asset acquisition or similar business combination with one or more operating businesses, which we refer to as a "business combination," that we believe has significant growth potential. We intend to use the cash derived from the net proceeds of the private placement of our insider warrants, our initial public offering and the exercise by the underwriters of their over-allotment option, together with any additional financing arrangements that we undertake, to effect a business combination. While we are actively seeking to identify a target business, we have not limited ourselves to particular industries and/or types of businesses that may provide such opportunities.

In August 2006, in connection with our formation and initial capitalization, we issued 3,125,000 shares of our common stock to Columbus Acquisition Holdings LLC, at a purchase price of approximately $0.008 per share, or an aggregate of $25,000. Columbus Acquisition Holdings LLC is a limited liability company formed under the laws of Delaware that is controlled by Andrew Intrater, our Chairman and Chief Executive Officer, and principally owned by Mr. Intrater and certain other members of our management team. We refer to Columbus Acquisition Holdings LLC as "Columbus Holdings" in this annual report.

On May 23, 2007, we completed our initial public offering of 12,500,000 units, plus the 1,875,000 units that were attributable to the full exercise of the underwriters' over-allotment option. Each unit consists of one share of our common stock and one warrant. Each warrant entitles the holder to purchase from us one share of our common stock at a price of $6.00 commencing on the later of the date that we complete a business combination with an operating company and May 18, 2008. We paid $4,600,000 in underwriting discounts and approximately $600,000 for costs and expenses related to our initial public offering at the closing of the offering, and the balance of $3,450,000 of underwriting discounts and commissions has been deferred and placed in the trust account as described below.

On May 23, 2007, we also completed a private placement of 3,650,000 warrants to Columbus Holdings for a purchase price of $1.00 per warrant, or an aggregate of $3,650,000. These insider warrants are identical to the warrants underlying the units that we issued in our initial public offering (which we refer to as "public warrants"), except that if we call the public warrants for redemption, the insider warrants may be exercisable on a "cashless" basis so long as such insider warrants are held by Columbus Holdings or its permitted transferees. Additionally, Columbus Holdings has agreed that it will not sell or otherwise transfer these insider warrants until such time, if any, as we shall have completed a business combination with an operating business. No underwriting discounts or commissions were paid with respect to the sale of our insider warrants.

Approximately $109,750,000 of net proceeds from our initial public offering, plus the $3,650,000 we received from the sale of the insider warrants (described below), has been placed in a trust account. This amount includes $3,450,000 (of the total of $8,050,000) of underwriting discounts and commissions, payable to the underwriters in our initial public offering. The underwriters have agreed that such amount will not be paid to them unless and until we complete a business combination with one or more operating businesses, and they have waived their right to receive such payment upon our liquidation if we are unable to complete a business combination before May 18, 2009.

All of the funds held in the trust account have been invested in a money market fund maintained by Morgan Stanley Investment Management. Specifically, this money market fund is held within the "Government Portfolio" of one of the Morgan Stanley Institutional Liquidity Funds, a money market fund that invests exclusively in obligations of the U.S. government and its agencies and instrumentalities, and in repurchase agreements collateralized by such securities. We have been advised by Morgan Stanley that the money market fund in which we have invested the funds held in the trust account is held in a separate stand-alone investment company with an independent board of directors or trustees, and the trust account assets are held in a separate segregated account for this money market fund at a custodian bank (J.P. Morgan Chase & Co. in our case). Our investment of the trust account funds in this money market fund remains separate from the assets of Morgan Stanley and its subsidiaries, and cannot be commingled at any time with assets of Morgan Stanley or its subsidiaries. However, an investment in this money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. We are exposed to credit risk in the event that the financial position of the financial institution that holds the trust account assets deteriorates and such financial institution is no longer able to satisfy its financial obligations.

Through December 31, 2008, our efforts have been limited to organizational activities, activities relating to our initial public offering, activities relating to identifying and evaluating prospective acquisition candidates, including IDE, and activities relating to general corporate matters; we have neither engaged in any operations nor generated any revenues, other than interest income earned on the proceeds of our private placement and initial public offering. For the year ended December 31, 2008, we earned $2,268,452 in interest income, all of which was received as of December 31, 2008.

For the period from August 1, 2006 (inception) through December 31, 2006, we paid $1,453 in expenses. For the year ended December 31, 2007, we paid or incurred approximately $432,000 in expenses. For the year ended December 31, 2008, we paid or incurred approximately $2,470,422 in expenses. For the period from August 1, 2006 (inception) through December 31, 2008, we paid or incurred an aggregate of $2,903,875 in expenses, for the following purposes:

· premiums associated with our directors and officers liability insurance;

· estimated taxes incurred as a result of interest income earned on funds currently held in the trust account;

· franchise tax incurred in the State of Delaware;

· monthly fee paid to Renova U.S. Management, LLC for office and administrative services;

· due diligence and investigation of prospective target businesses;

· legal and accounting fees relating to our reporting obligations under U.S. securities laws and general corporate matters; and

· other miscellaneous expenses.

We will continue to earn interest on the trust account to finance our operations (limited to $1,750,000 plus any amounts we may need to pay our income or other tax obligations) prior to consummating a business combination. We currently believe that we have sufficient available funds to complete our efforts to effect a business combination with one or more operating businesses on or prior to May 18, 2009. However, we cannot assure you that this will be the case. Please see the section entitled "Risk Factors" in this annual report for a detailed discussion of the many risks to which we are subject, a number of which (if they were to materialize) could adversely impact our ability to effect a business combination. As of December 31, 2008, $1,445,000 of working capital has been funded from the interest earned from the funds held in the trust account, and an additional $305,000 from interest earned on the funds held in the trust account will be available to fund our future working capital requirements until such time, if any, that we complete a business combination. We have incurred, and expect to continue to incur, expenses principally for the following purposes:

· premiums associated with our director's and officer's insurance;

· estimated taxes incurred as a result of interest income earned on funds currently held in the trust account;

· franchise tax incurred in the State of Delaware;

· monthly fee paid to Renova U.S. Management, LLC for office and administrative services;

· due diligence and investigation of prospective target businesses;

· legal and accounting fees relating to our reporting obligations under U.S. securities laws and general corporate matters;

· structuring and negotiating a business combination, including the making of a down payment or the payment of exclusivity or similar fees and expenses;

· legal and accounting fees relating to our proposed Merger with IDE; and

· other miscellaneous expenses.

To the extent we incur expenses prior to the completion of a business combination in excess of the $1,750,000 (plus any amounts we may need to pay our income or other tax obligations) available to us from the interest earned on the trust account, we intend to pay such excess expenses from working capital available to us following the consummation of a business combination. If we do not complete a business combination, one of our directors has agreed to indemnify us against any claims by any vendor, prospective target business, or other entities that are owed money from us for services rendered or products sold to us that would reduce the amount of the funds in the trust account.

Since June 1, 2007, we have paid a monthly fee of $7,500 to Renova U.S. Management LLC, an affiliate of certain members of our management team, for office space and certain administrative, technology and secretarial services provided to us by that company. We expect to continue to pay this monthly fee until the time, if any, that we effect a business combination.

We may use substantially all of the proceeds held in trust, other than the deferred underwriting discounts and commissions of $3,450,000 and amounts used for working capital and for taxes, to acquire one or more operating businesses. However, we may not use all the proceeds held in the trust account in connection with a business combination, either because the consideration for the business combination is less than the total proceeds that are then held in the trust account or because we finance a portion of the consideration by issuing our capital stock or debt securities, if the business combination is structured in that manner and such alternative is then available and deemed suitable. In that event, the proceeds held in the trust account as well as any other net proceeds not expended will be used to finance the operations of the target business or businesses. The operating business or businesses that we acquire in such business combination or business combinations must have, individually or collectively, a fair market value equal to 80% of the value of our net assets, including the funds held in the trust account that holds our initial public offering proceeds (excluding the deferred underwriting discounts and commissions from our initial public offering). If we complete multiple business combinations that collectively have a fair market value of 80% of the value our net assets, then we would require that such transactions be completed simultaneously. We do not currently anticipate that we will complete a business combination with more than one operating business; however, we cannot assure you at this time that we will not do so.

As described in this annual report, on December 15, 2008 our board of directors approved a business combination with IDE. IDE, through its subsidiaries, is an established participant in the business of manufacturing new and refurbishing existing land-based drilling rigs, rig components and rig electrical systems and providing related services to the oil and gas drilling equipment industry on a global basis. Please refer to the section of this annual report entitled "The Proposed Business Combination with Integrated Drilling Equipment Company-General-The Merger Agreement," for a detailed description of the structure of the proposed Merger with IDE, including the Merger consideration that we will pay and deliver at the closing of the Merger and following the closing, subject to the terms and conditions described in that section, related expenses and the sources of such Merger consideration and related expenses.

We are unable to assure you that our plans to consummate a business combination will be successful or successful within the target business acquisition period, which ends on May 18, 2009. This factor, among others, raises substantial doubts about our ability to continue operations as a going concern. Our financial statements, which are included in this annual report, do not include any adjustments that may result from the outcome of this uncertainty.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Our actual results could materially differ from those estimates. We refer you to Note 2 of our financial statements in this annual report for a summary of our significant accounting policies.

Results of Operations

Our net loss of $372,970 for the year ended December 31, 2008 was comprised of $2,268,452 of interest income on investments held in trust, offset by formation and operating costs of $2,470,422 and a provision for income taxes of $171,000.

Our net income of $1,564,578 for the year ended December 31, 2007 was comprised of $3,434,578 of interest income on investments held in trust, offset by formation and operating costs of $432,000 and a provision for income taxes of $1,438,000.

Our net loss of $1,453 for the period from inception (August 1, 2006) through December 31, 2006 was comprised of formation and operating costs of $1,453.

Our net income of $1,190,155 for the period from inception (August 1, 2006) through December 31, 2008 was comprised of $5,703,030 of interest income on investments held in trust, offset by formation and operating costs of $2,903,875 and a provision for income taxes of $1,609,000.

Liquidity and Capital Resources

As of December 31, 2008, $115,081,369 was held in trust and $305,000 was available to us to pay for fees and expenses relating to business, legal and accounting due diligence on prospective target companies and continuing general and administrative expenses, after giving effect to our withdrawal of approximately $4,482,613 (of a total of $6,163,982) of interest earned on the funds held in the trust account through such date. Of the total amount held in the trust account, $3,450,000 will be paid to the underwriters of our initial public offering at such time, if any, as we complete a business combination with one or more operating businesses, less up to approximately $1,034,655 that will be distributed to our public shareholders who elect to receive their pro rata share of the trust fund and do not approve the business combination that we complete, as described in Note 1 of our financial statements in this annual report. If we do not complete a business combination with a target company and are forced to liquidate, the entire deferred underwriters' discounts and commissions of $3,450,000 will remain in the trust fund and be distributed to our public shareholders. We have used $1,445,000 of the $4,482,613 that we have withdrawn from the trust account through December 31, 2008 to pay fees and expenses relating to our activities in connection with identifying and conducting the related due diligence with respect to companies that we have considered as possible candidates with which we would complete a business combination, and for general corporate purposes. The balance of $3,037,613 of interest that we have withdrawn from the trust account has been used to fund our franchise taxes and our actual and estimated income taxes relating to interest income earned on the funds held in the trust account. The following table shows the total funds held in the trust account as of December 31, 2008:

Net proceeds from our initial public offering and private placement of
warrants to Columbus Holdings placed in trust                            $ 109,950,000
Deferred underwriters' discounts and commissions                         $   3,450,000
Total interest received to date                                          $   6,163,982
Less:
Interest income disbursed to us for working capital through December
31, 2008                                                                 $  (1,445,000 )
Interest income disbursed to us to fund our income and other tax
obligations with respect to interest income on the funds held in the
trust account                                                            $  (3,037,613 )
Total funds held in trust account through December 31, 2008              $ 115,081,369

We believe that the net proceeds that are held in trust and the amounts available to us for working capital will be sufficient to allow us to consummate a business combination before May 18, 2009. If the net proceeds held in trust prove to be insufficient, either because of the size of the target business, the depletion of the available net proceeds expended in search of a target business, or our obligation to convert into cash up to 29.99% of our common shares held by the public shareholders that elect to receive their pro rata share of the trust fund and do not approve the business combination as described in Note 1 of our financial statements, we may be required to seek additional financing through the issuance of additional shares of our common or preferred stock, or obtain acquisition financing from a commercial or other lender, to complete a business combination. As of the date of this annual report and since at least mid-2007, the financial markets generally, and the credit markets in particular, are and have been experiencing substantial turbulence and turmoil, and extreme volatility, both in the United States and in other markets worldwide. The current market situation has resulted generally in substantial reductions in available loans to a broad spectrum of businesses, increased scrutiny by lenders of the credit-worthiness of borrowers, more restrictive covenants imposed by lenders upon borrowers under credit and similar agreements and, in some cases, increased interest rates under commercial and other loans, and decreased availability of equity capital. We cannot predict whether the current situation in the credit and equity markets will improve or whether it will deteriorate further. If we require or are relying upon additional financing to complete a business combination, we cannot assure you that such financing will be available upon commercially acceptable terms or at all. To the extent that additional financing proves to be unavailable when needed to consummate a particular business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek to effect a business combination with an alternative target business. If we fail to complete a specific business combination after expending substantial management time and attention and incurring substantial costs for accountants, attorneys, and others, such costs likely would not be recoverable, which could have a material adverse effect our subsequent ability to locate and engage in a business combination with another target business on or before May 18, 2009. In addition, even if we do not need additional financing to consummate a business combination, we may require additional financing to fund the operations or growth of the target business. The failure to secure such financing could have a material adverse effect on the continued development or growth of the business or businesses with which we effect a business combination. None of our officers, directors or shareholders is required to provide any financing to us in connection with, or following, a business combination.

The initial operating business or businesses with which we effect a business combination must have a total fair market value equal to at least 80% of the value of our net assets, including the funds held in the trust account that holds our initial public offering proceeds (excluding the deferred underwriting discounts and commissions from our initial public offering). However, we may not use all of the proceeds held in the trust account in connection with a business combination, either because the consideration for the business combination is less than the proceeds held in trust or because we finance a portion of the consideration through the issuance of our equity or debt securities. In that event, the proceeds held in the trust account as well as any other net proceeds not expended to complete the business combination will be used to finance the operations of the business or businesses with which we effect a business combination.

We may issue additional shares of our capital stock or our debt securities to finance a business combination. The issuance of additional capital stock (currently 2,225,000 authorized but unissued and unreserved common shares available for issuance), including upon conversion of any convertible debt securities we may issue, or the incurrence of debt, could have material consequences on our business and financial condition. The issuance of additional shares of our capital stock (including upon conversion of convertible debt securities, if any):

· may significantly reduce the equity interest of our shareholders;

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

· may adversely affect the prevailing market price of our common stock.

Similarly, 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 pay 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 the covenants contained in any debt securities, such as covenants that require the satisfaction or maintenance of certain financial ratios or reserves, without a waiver or renegotiation of such covenants;

· an obligation to immediately repay all principal and accrued interest, if any, upon demand to the extent any debt securities are payable on demand; and

· our inability to obtain additional financing, if necessary, to the extent any debt securities contain covenants restricting our ability to obtain additional financing while such security is outstanding, or to the extent our existing leverage discourages other potential investors.

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