Forward Looking Statements

The information contained in this section has been derived from the consolidated financial statements of Clark Holdings Inc. (referred to herein as ''we,'' ''us'' or ''our,'' or as the ''Company'' or ''CHI'') and should be read together with our consolidated financial statements and related notes included elsewhere in this Quarterly Report. This Quarterly Report, including the Management's Discussion and Analysis of Financial Condition and Results of Operations, contains forward looking statements that involve substantial risks and uncertainties. These forward looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our industry, our beliefs, and our assumptions. Words such as ''anticipates'', ''expects'', ''intends'', ''plans'', ''believes'', ''seeks'', and ''estimates'' and variations of these words and similar expressions are intended to identify forward looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward looking statements, including without limitation, the risks, uncertainties and other factors we identify from time to time in our filings with the Securities and Exchange Commission, including our Form 10-Ks, Form 10-Qs and Form 8-Ks.

Although we believe that the assumptions on which these forward looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward looking statements based on those assumptions could also be incorrect. In light of these and other uncertainties, the inclusion of a projection or forward looking statement in this Quarterly Report should not be regarded as a representation by us that our plans and objectives will be achieved. You should not place undue reliance on these forward looking statements, which apply only as of the date of this Quarterly Report. We undertake no obligation to update such statements to reflect subsequent events.

Our Business Prior to the Acquisition

We were formed as a blank check company on September 1, 2005 to effect a merger, capital stock exchange, asset acquisition or other similar business combination with an operating business in the transportation and logistics sector and related industries.

On February 21, 2006, we closed our initial public offering of 10,000,000 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 $6.00 per share. On March 1, 2006, we closed on the sale of an additional 1,000,000 units which were subject to an 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 $88,000,000. After deducting underwriting discounts and commissions and offering expenses, the total net proceeds to us from the offering (including the over-allotment option) were $80,997,000, of which $79,340,000 was deposited into a trust account (''Trust Account'') and the remaining proceeds of $1,657,000 became available to be used to provide for business, legal and accounting due diligence on prospective business combinations and continuing general and administrative expenses. The funds held in the Trust Account were not to be released until the consummation of an initial business combination or our liquidation, if earlier.

We did not engage in any substantive commercial business until we consummated our business combination with The Clark Group, Inc. (''CGI''), as described below.

The Acquisition and the New Credit Facility

On February 12, 2008, we purchased all of the outstanding capital stock of CGI pursuant to the Stock Purchase Agreement (''SPA''), dated May 18, 2007, as amended on November 1, 2007, by and among us, CGI and the stockholders of CGI (''Acquisition''). At the closing of the stock purchase, the former stockholders of CGI were paid $72,527,472.53, less $8,300,000 of the purchase price that was placed in escrow as described below, and were issued 320,276 shares of our common stock, valued at $7.72 per share (the market price when the SPA was originally signed on May 18, 2007), for an original total purchase price of $75,000,000. Upon the consummation of the Acquisition, the funds held in the Trust Account were released to us and used, in part, to pay the purchase price of CGI.

At the closing of the Acquisition, an escrow agreement ("Escrow Agreement") was entered into providing for (i) $7,500,000 as a fund for the payment of indemnification claims that may be made by the Company as a result of any breaches of CGI's covenants, representations and warranties in the SPA ("Indemnification Escrow"), (ii) $500,000 as a fund to pay us the amount, if any, by which the average of the working capital on the last day of the month for the twelve months ended March 31, 2008 was higher (less negative) than negative $1,588,462 ("Working Capital Escrow"), and (iii) $300,000 as a fund to reimburse CGI and us for costs incurred in connection with discontinuing certain of CGI's operations in the United Kingdom ("Discontinued Operations Escrow"). . On September 15, 2008, the entire Discontinued Operations Escrow was released to the former stockholders of CGI. Also in accordance with the Escrow Agreement, $2.5 million was released to former stockholders of CGI on August 14, 2008.

The aggregate purchase price of the Acquisition shown in the financial statements is $77,106,830 and was determined based on the value of the cash consideration paid by the Company, the value of the Company's common stock on the day of the Acquisition, and the direct acquisition costs incurred. The aggregate purchase price of $77,106,830 represents the sum of (i) $64,876,642 in cash consideration that was paid directly to CGI's shareholders, (ii) $8,300,000 in cash that was deposited in the three separate escrows, (iii) $493,192 of deferred acquisition costs that were paid at closing, (iv) $964,465 of deferred acquisition costs that were paid prior to closing, and (v) $2,472,531 representing the 320,276 shares of common stock that were issued to two executive officers of the Company at closing, valued at the market price of $7.72 per share as on February 12, 2008.

Simultaneously with the Acquisition, the Company entered into a credit agreement, as borrowers, with various financial institutions party thereto, as lenders, and LaSalle Bank National Association, as administrative agent (''LaSalle'') (''Credit Agreement''). Pursuant to the Credit Agreement, the Company received a financing commitment of up to $30,000,000 for a senior secured credit facility from LaSalle in order to (a) pay for conversion shares,
(b) provide working capital for the Company and the Company's direct and indirect subsidiaries and (c) provide for future permitted acquisitions. The facility consists of up to $20,000,000 that can be drawn within 60 days of the Closing Date (and was subsequently extended to 120 days on April 18, 2008) as a term loan sublimit and up to $30,000,000, less any amount drawn under the term loan sublimit, as a revolving credit facility with a $3,000,000 sublimit for letters of credit. As of July 28, 2008, the Company had drawn $4,733,256.24 under the term loan to pay conversions and no funds under the revolving credit facility.

Overview of Our Business

The Company is a niche provider of non-asset based transportation and logistics services to the print media industry throughout the United States and between the United States and other countries. The Company operates through a network of operating centers where it consolidates mass market consumer publications so that the publications can be transported in larger, more efficient quantities to common destination points. The Company refers to each common destination point's aggregated publications as a ''pool''. By building these pools, the Company offers cost effective transportation and logistics services for time sensitive publications.

The Company generates revenues by arranging for the movement of its customers' freight in trailers and containers. Generally, the Company bills its customers based on pricing that is variable based upon the amount of tonnage tendered, frequency of recurring shipments, origination, destination, product density and carrier rates. The Company's specified rates are subject to weight variation, fuel surcharge, and timely availability of the customer's product. The Company provides ancillary services such as warehousing and other services (e.g. product labeling). As part of its bundled service offering, the Company tracks shipments in transit and handles claims for freight loss or damage on behalf of its customers. Because the Company owns relatively little transportation equipment, it relies on independent transportation carriers.

The Company is a principal and not a broker of transportation services. By accepting the customer's order, it accepts certain responsibilities for transportation of the shipment from origin to destination. The Company selects carriers based upon myriad factors that include service reliability and pricing. Carrier pricing is typically from a pre-negotiated tariff rate table. The carrier's contract is with the Company, not its customer, and the Company is responsible for payment of carrier charges. In the cases where the Company has agreed to pay for claims for damage to domestic freight while in transit, when appropriate the Company will pursue reimbursement from the carrier for the claims.

The Company operates as a niche service provider. Its publisher and printer customer relationships are long standing. Many domestic customers have the Company handle a substantial portion of their freight transportation to single copy magazine wholesalers. The Company's principal competitors are the in-house transportation and logistics capabilities of the larger printers.

The Company's core business involves the shipment of mass market consumer magazines. Its business is impacted by the specifics of its underlying publications (including the number of copies shipped and the pages per copy which vary with advertising), the mix of publication frequency (e.g. weekly, monthly, annual), the number of destination points, and the service levels requested by its customer publishers and printers. Over the last three years, the Company's domestic business has been favorably impacted by the publications that have relatively lower cover prices and by the launch of new weekly publications. Except for special editions publications (e.g. Princess Di's death), distribution of mass market consumer magazines is fairly consistent and predictable. Mass market magazines generally do not experience material swings in volume in the aggregate. The Company's business has also been favorably impacted by the large number of publications offered for sale by mass market retailers. Generally, demand for the Company's services increases with fragmentation and it is able to charge higher fees per hundredweight for smaller quantity publications or tonnage going to a destination point. Management expects its future freight pools, demand for services and pricing to remain fairly consistent with its past experience.

Gross revenues have increased over the last several years. The ratio of freight expenses to gross revenues has increased, reducing the Company's margin. Fuel increases have contributed to the margin decline because as surcharges are passed along in the form of higher billing rates, revenues increase without a corresponding change to gross profit. The decline in margin also reflects a shift in the customer mix towards the Company's largest customers where it has lower margins. The Company's top 10 domestic customers' revenue represents approximately 64% of its 2007 domestic revenue. The Company uses various performance indicators to manage its business. The Company closely monitors margin and gains and losses for its top 20 customers and loads with negative margins. The Company also evaluates on-time performance, costs per load by location and weekly revenue by location. Vendor cost changes and vendor service issues are also monitored closely.

Critical Accounting Policies and Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make decisions based on estimates, assumptions and factors it considers relevant to the circumstances. Such decisions include the selection of applicable principles and the use of judgment in their application, the results of which could differ from those anticipated.

A summary of our significant accounting policies are described in Note 2 of our consolidated financial statements for the three months ended September 27, 2008, as included in this Quarterly Report on Form 10-Q.

There have been no changes in critical accounting policies in the current year from those relating to CHI described in our Definitive Proxy Statement dated January 28, 2008 and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007.

Acquisition of CGI

Prior to the Acquisition, the Company's primary asset was the Trust Account which held funds from the Company's initial public offering. As of February 12, 2008, the date the Acquisition was consummated, approximately $88,700,000 (including $2,640,000 of deferred underwriting discounts and commissions) was held in the Trust Account. Upon the consummation, the funds in the Trust Account were released to the Company and were used to pay the purchase price of CGI to the stockholders of CGI, including a working capital adjustment and expense reimbursement. The Company also paid deferred commissions to the underwriters of its initial public offering. The Company used the remainder of the funds to pay conversions, as well as for working capital.

The Company has accounted for the Acquisition under the purchase method of accounting. Accordingly, the cost of the Acquisition has been allocated to the assets and liabilities based upon their respective fair values, including identifiable intangibles and remaining cost allocated to goodwill. The Company continues to refine the fair value estimates in accordance with SFAS 141. As additional information becomes available and as actual values vary from these estimates, the underlying assets and liabilities may need to be adjusted, thereby impacting intangible asset estimates, as well as goodwill.

The results of operations of the acquired company, CGI, have been included in the Company's year to date consolidated financial statements from February 12, 2008 through September 27, 2008. This was accomplished as follows:

· In our presentation of the consolidated statement of operations, we included 39 weeks of revenue and expenses of CGI from January 1, 2008 through September 27, 2008.

· In addition, the Company deducted CGI's income from operations from January 1, 2008 through February 11, 2008 (i.e., the "Acquisition Date"), as a single line item adjustment.

The final purchase price for the Acquisition at closing was determined based on the value of the cash consideration paid by the Company, the value of Company's common stock on the announcement date, and the direct acquisition costs incurred. The aggregate purchase price of $77,106,830 represents the sum of (i) $64,876,642 in cash consideration paid directly to CGI's shareholders, (ii) $8,300,000 in cash that was deposited in three separate escrows, as described above (iii) $493,192 of deferred acquisition costs paid at closing, (iv) $964,465 of deferred acquisition costs paid prior to closing, and (v) $2,472,531 representing the 320,276 shares of common stock that were issued to two executive officers of the Company at closing, which was valued at the market price of $7.72 per share as on May 18, 2007.

The components of the purchase price of the Acquisition are as follows:

   Cash to CGI shareholders                                        $ 64,876,642
   Cash in escrows                                                    8,300,000
   Acquisition costs paid at Closing                                    493,192
   Acquisition costs paid prior to Closing                              964,465
   Total                                                             74,634,299
   Issuance of 320,276 shares of common stock at $7.72 per share      2,472,531
   Total Purchase Price                                            $ 77,106,830

Reconciliation of initial cash payment per the SPA to cash paid at the closing of the Acquisition is summarized as follows:

       Initial estimate of cash distribution                  $ 72,527,473
       Cash in escrow                                           (8,300,000 )
       Interim working capital adjustment to purchase price        495,067
       Reimbursement of professional fees                          154,102
       Cash to CGI shareholders                               $ 64,876,642

A preliminary allocation of the purchase price of CGI to the estimated fair values of the assets acquired and liabilities assumed of CGI on February 12, 2008 was made and recorded during the fiscal quarter ended March 29, 2008. The preliminary allocation of the purchase price, including the evaluation and allocation to identifiable intangible assets, recognition of deferred taxes and allocation to goodwill resulting from the Acquisition, was made by management based on a valuation report that was prepared for management by an independent valuation firm and included certain assumptions management considers reasonable. The preliminary estimates will be subject to change based on the finalization of asset and liability valuations of CGI, and will depend in part on prevailing market rates and conditions. A final determination of the fair values will be completed during fiscal year 2008. The final valuations will be based on the actual net tangible and intangible assets of CGI that existed as of February 12, 2008. Any adjustments may change the allocation of purchase price, which could affect the fair value assigned to the assets acquired and liabilities assumed and could result in a material change to the Company's condensed consolidated financial statements.

The preliminary allocation of the fair value of the assets acquired and liabilities assumed in the Acquisition of CGI are as follows:

          Current assets                                   $  6,956,000
          Current assets of discontinued operations             388,000
          Property and equipment                              1,394,000
          Intangibles                                        26,575,000
          Goodwill                                           49,367,000
          Current liabilities                                (7,441,000 )
          Current liabilities of discontinued operations       (132,000 )
          Total fair value of assets and liabilities       $ 77,107,000

During the 13 weeks ended September 27, 2008, the Working Capital Escrow account of $500,000 was released and approximately $245,000 of these escrow funds were paid directly to the Company in accordance with the Stock Purchase Agreement. The purchase price and goodwill were adjusted accordingly.

Description of the Acquired Intangible Assets

As part of the Acquisition, the Company acquired various intangible assets of CGI. The major intangible assets include non-compete agreements from the existing owners of the CGI Group, existing customer relationships, proprietary software, and tradenames. A more detailed description of the various intangible identifiable intangibles is as follows:

Software.?CGI's proprietary software was acquired as part of the Acquisition. Based on the software appraisal provided by an independent software consulting firm, there are approximately 6,500 programs on the AS400 Platforms in operation at CGI for all the various companies and divisions.

Non-compete Agreements.?As part of the Acquisition, the Sellers agreed to a non-competition agreement in effect for six years. The non-compete agreement prohibits the Sellers from competing with or soliciting employees or business from CGI.

Tradenames.?The Company also acquired the CGI tradename. The CGI tradename has value in the industry and is valuable to the Company.

Customer Relationships.?As part of the Acquisition, the Company acquired CGI's existing customer relationships. As described in the executive summary above, CGI has excellent relations with its customer base.

The following table lists the Company's intangible assets as of the date of Acquisition and their estimated useful lives, as initially valued by Management:

                                        Amortization     Fair Value at
                                           Period         Acquisition
             Software                           5       $     1,197,000
             Non-compete agreements             6             6,412,000
             Tradenames                         -             5,378,000
             Customer relationships             12           13,588,000
                                                             26,575,000
             Accumulated amortization                        (1,541,000 )
             Intangible assets                          $    25,034,000

Demand for Our Services May be Impacted During an Economic Recession

The transportation industry historically has experienced cyclical fluctuations in financial results due to economic recession, downturns in business cycles of our customers, fuel shortages, price increases by carriers, interest rate fluctuations, and other economic factors beyond our control. Many of the Company's customers' business models are dependent on expenditures by advertisers. These expenditures tend to be cyclical, reflecting general economic conditions, as well as budgeting and buying patterns. If economic recession or a downturn in its customers' business cycles causes a reduction in the volume of freight shipped by those customers, particularly to the single copy distribution channel, the Company's operating results could also be adversely affected.

Annual Review of Goodwill Impairment

Under SFAS No. 142, goodwill is reviewed for impairment on at least an annual basis, or when events or circumstances indicated that the carrying value of such assets may not be recoverable. The Company will conduct its annual review at the end of 2008.

The assessment of goodwill impairment involves a two-step process. The first step is a comparison of the fair value of a reporting unit with its carrying amount. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered impaired. If the carrying amount of a reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairments loss, if any.

The second step of the impairment test is a comparison of the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount exceeds the implied fair value, an impairment loss must be recognized in the amount of that excess. One component of the fair value in the annual assessment of the goodwill impairment is the market price of the Company's stock. The Company's stock price has declined 57% since the beginning of the 3rd quarter of 2008 through November 3, 2008.

No impairment losses have been recognized to date. However, if the Company determines that the carrying amount exceeds the implied fair value amount at year end, an impairment loss will be recognized and presented as a separate line item on the consolidated statement of operations. As of September 27, 2008, the Company recorded goodwill in the amount of approximately $61.0 million.

If these current economic trends continue, management believes there is a significant potential that a substantial portion of goodwill, if not all of the $61.0 million, will be impaired at year end and an impairment loss up to $61.0 million may be recognized.

Results of Operations
Third Quarter 2008 Compared to Third Quarter 2007

The results of operations for the 13 weeks ended September 27, 2008 and September 29, 2007, where appropriate and for comparison purposes, include the results of the acquired company, CGI, showing the acquired company as if it was owned and operated during both quarters. Prior to the Acquisition of CGI on February 12, 2008, the Company was a ''blank check'' company and did not have any results from operations.

Revenues. The table below summarizes the Company's revenue by business segment (i.e., domestic versus international in thousands of dollars) for the third quarter of 2008 versus the third quarter of 2007. The first two columns of this table show revenue by segment for CHI only for the third quarter of 2008 (which includes the revenue of CGI for the 13 week period) versus CHI's revenue for third quarter of 2007 in accordance with our GAAP financial statements. Note that there is no revenue for 2007, since CGI had not been acquired by CHI until 2008. The last two columns of this table provide a more meaningful comparison of operations since they show the revenue by segment for CHI, with the acquired business, CGI, included in both the third quarter of 2008 and, on a pro forma basis, the third quarter of 2007.

                   13 Weeks Ended September         13 Weeks Ended September
                                                                   (Pro-Forma)
                         CHI              CHI         CHI           CHI & CGI
                        2008             2007         2008             2007         % Change
 Domestic        $            18,246     $   -    $     18,246     $     15,917          14.6 %
 International                 4,072         -           4,072            3,385          20.3 %
 Gross Revenue                22,318         -          22,318           19,302          15.6 %

The following table shows selected items in the consolidated statements of operations as a percentage of revenue for the 13 weeks ended September 27, 2008 versus September 29, 2007. As with the previous table, the first two columns are for CHI only, in accordance with our GAAP financial statements. There was no gross revenue in 2007 since CGI had not been acquired as of yet. The last two columns of this table shows selected items as a percentage of revenue for the 13 weeks ended September 27, 2008 versus September 29, 2007, with CGI financial results included in both quarters for the purpose of comparing the performance of the underlying business.

                                          13 Weeks Ended September            13 Weeks Ended September
                                                                                             (Pro-Forma)
                                            CHI                 CHI             CHI           CHI & CGI
                                            2008                2007           2008             2007
. . .