The information contained in this section should be read in conjunction with our financial statements and related notes and schedules thereto appearing elsewhere in this Annual Report. This Annual 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. Such risks, uncertainties and other factors include, 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 Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

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 also could be incorrect. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Annual 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 Annual Report. We undertake no obligation to update such statements to reflect subsequent events.

Summary of Business

The Company is a niche provider of non-asset based transportation management 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 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. 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.

On a day-to-day basis, customers communicate their freight needs, typically on a shipment-by-shipment basis, to one of the Company's transportation offices/distribution centers for dissemination to its operating companies for upload into their respective systems each company utilizes to meet the specific requirements of its customer base. The Company's employees enter information about each shipment into its proprietary operating system. With the help of information provided by the operating system, the Company's employees then determine the appropriate mode of transportation for the shipment and select a carrier or carriers, based upon their knowledge of the carrier's service capability, equipment availability, freight rates and other relevant factors.

We operate through our wholly-owned subsidiary, CGI. We conduct our domestic operations through our indirect subsidiaries, CDS and HDS, and our international operations through our indirect subsidiary, CWT. Each of CDS, HDS and CWT is a wholly-owned subsidiary of CGI.

CDS Operations & Activities (Domestic Division)

CDS provides domestic newsstand magazine distribution services through North America. Essentially, CDS operates a "hub-and-spoke" network of operating centers and professional traffic management services, which provide publishers and printers with the benefits of scheduled delivery and reduced cost by shipping in a consolidated weekly pool managed by CDS. On average, CDS delivers over 35 million magazines per week from over 90 print locations to wholesalers across North America.

HDS Operations & Activities (Domestic Division)

CDS utilizes HDS for about 25% of its transportation moves (the other 75% is done through third-parties). HDS provides ground-based transportation services to the print media industry. HDS' network includes 40 company-leased trucks, 76 leased and 18 company-owned trailers, four distribution centers and relationships with over 50 third-party transportation providers. Approximately 39% of HDS' transportation is hauled on its own equipment and the remaining 61% is hauled by third parties.

HDS' core business is providing traditional "break-up" services for printers and publishers in regions surrounding its four distribution centers. The break-up service is similar to a regional less-than-truckload service, where freight is picked up from a customer, transported to one of the HDS distribution centers, pooled with other shipments headed in similar proximities and sent to final destinations. Through its distribution centers HDS provides break-up services throughout the country. HDS also offers full truckload services throughout the United States. Distribution Centers are located in:

• York, Pennsylvania

• Kansas City, Missouri

• Dallas, Texas

• Amarillo, Texas (provides a consolidation and transportation service for returns to suppliers.)

HDS provides transportation services utilizing trucks both owned and leased through the Evergreen Express Lines, Inc. ("EXL"). Drivers are employees of EXL. The company owns and leases equipment in Missouri, Pennsylvania and Tennessee.

CWT Operations & Activities (International Division)

CWT offers consolidation and import/export transportation management and logistics services to print media worldwide. CWT utilizes three distribution centers to consolidate shipments and arrange for international transportation utilizing third-party carriers. CWT's primary functions are break-bulk and sortation and re-consolidation of titles into single specific shipments. Distribution centers are located in:

• Wayne, New Jersey

• Wilmington, California

• Laredo, Texas.

Recent Events
Amendment to the Credit Facility

As at January 3, 2009, the Company recorded an impairment charge of approximately $66,000,000, as more fully described in this Item in the section entitled "Impairment to Goodwill and Other Intangibles." The recording of the impairment charge resulted in events of default with respect to certain of the financial covenants contained in the Credit Agreement. On April 17, 2009, the Company entered into the Amendment to the Credit Agreement, whereby the Bank waived the events of default and agreed to modify the financial covenants to account for the impairment charge. The Company also agreed to certain other changes to the Credit Agreement. Pursuant to the Amendment, the lenders' revolving loan commitment is now $3,000,000, which the Company and its subsidiaries may use for working capital, with a $2,000,000 sublimit for letters of credit. The term loan balance of $3,786,605 remains outstanding. The Company may borrow up to the amount of the revolving loan commitment, except that its borrowings under the revolving loan may at no time exceed the sum of the Company's borrowing base (as defined in the Amendment) plus its cash collateralized letters of credit less the amount of the outstanding term loan. The interest rate charged under the facility was changed to 4.00% over LIBOR or 2.50% over the prime interest rate, as applicable. The non-use fee changed to 0.675% per year and the fee for letters of credit changed to 1.75%. The amortization of the term loan has not changed.

We believe that our existing cash and cash equivalents, cash flow from operations and our amended bank credit facility are adequate to meet our liquidity needs for the foreseeable future, including working capital, capital expenditure requirements, taxes and the term loan amortization obligations.

Instability in the Newsstand Distribution Channel

In the first quarter of 2009, there was a disruption of the wholesaler distribution supply channel, that caused a significant disruption of services for approximately a four week period. Initially, two of the four wholesalers demanded distribution surcharges from the publishers and national distributors to cover their operating losses and threatened a suspension of service if these price demands were not met. This resulted in

two of the four wholesalers ceasing distribution operations temporarily on February 1, 2009. One of the wholesalers that had ceased delivery of product reached a settlement with the national distributors and publishers concerning pricing and distribution. The other wholesaler ceased operations in early February, liquidated its holdings and filed a lawsuit in U.S District Court (Southern District of New York) against publishers, national distributors and other wholesalers, alleging the defendants conspired to purge, and through coordinated action have purged, plaintiff from the magazine (distribution) industry and have destroyed plaintiff's business. All of the defendants are existing customers of ours and a settlement against them could affect our business.

Claim for Indemnification

On February 9, 2009, the Company issued a notice certificate pursuant to the Escrow Agreement, stating that the Company, as buyer, was entitled to receive funds from the escrow in the amount of $3,540,717. The bulk of this claim (approximately 97%) pertains to damages incurred as a result of the Sellers' breach of their representations and warranties as contained in the SPA. Among other things, Sellers failed to deliver the intellectual property required by the SPA in the condition represented in the SPA. Damages incurred include damages to goodwill, the incremental costs of operating the Company's computer system as delivered versus as represented, and the costs of repairing and/or replacing the computer system.

Impact of 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.

Accounting for the Acquisition and Related Transactions

On February 12, 2008, the Company consummated the acquisition contemplated by the SPA (referred to herein as the "Acquisition"), as more fully described in Item 1 under the section entitled "The Acquisition." At the closing of the Acquisition, the Company purchased all of the issued and outstanding capital stock of CGI for a total consideration of $75,000,000 (of which $72,527,472.53 was paid in cash and $2,472,527.47 by the issuance of 320,276 shares of the Company's common stock valued at $7.72 per share, the average share price at the announcement of the SPA) plus an adjustment of $495,067 based on CGI's estimated working capital at the closing. Subsequently, an additional adjustment of $257,000 was paid to the stockholders of CGI based on CGI's working capital at the closing as finally determined. In connection with the closing of the Acquisition, the Company changed its name from Global Logistics Acquisition Corporation to Clark Holdings Inc.

At the closing of the Acquisition, we entered into an escrow agreement ("Escrow Agreement") with the stockholders of CGI, as sellers, 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 Acquisition Agreement ("Indemnification Escrow"), (ii) $500,000 as a fund to pay the Company the amount, if any, by which the average of the working capital on the last day of the month for the 12 months ended March 31, 2008, is higher (less negative) than negative $1,588,462 ("Working Capital Escrow"), and (iii) $300,000 as a fund to reimburse CGI and the Company for costs incurred in connection with discontinuing certain of CGI's operations in the United Kingdom ("Discontinued Operations Escrow"). On August 14, 2008, one third of the Indemnification Escrow, or $2.5 million, was released to former stockholders of CGI in accordance with the terms of the SPA. On September 15, 2008, the entire Discontinued Operations Escrow was released to the former stockholders of CGI. By the end of the third quarter of 2008, the entire Working Capital Escrow had been released, all of which was due to the Company in accordance with the SPA and the Escrow Agreement, but $257,000 of which was paid to the Sellers in satisfaction of the aforementioned adjustment to the Acquisition consideration based on the working capital at closing as finally

determined. On February 9, 2009, in accordance with the Escrow Agreement, the Company delivered a notice certificate for indemnification under the SPA, as described in this Item under the section entitled "Recent Events - Claim for Indemnification."

Holders of 1,787,453 of the Company's shares of common stock voted against the Acquisition and elected successfully to convert their shares into a pro rata portion of the Trust Account (approximately $8.06 per share or an aggregate amount of $14,428,871). After giving effect to (i) the issuance of 320,276 shares in connection with the Acquisition and (ii) the conversion of shares, there were 12,032,823 shares of common stock outstanding after the Acquisition. In addition, the founders of the Company placed 1,173,438 shares of common stock into escrow pending the attainment of a specified market price (restricted shares). As a result of the condition to which the escrowed shares will be subject, such shares will be considered as contingently issuable shares and, as a result, are not included in the earnings per share calculations. Accordingly, the Company will recognize a charge based on the fair value of the shares over the expected period of time it will take to achieve the target price, if and only if the expected probability of the share price attaining the specified market price exceeds 50 percent.

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 results of operations of the acquired company, CGI, have been included in the Company's consolidated financial statements for the 53 weeks ended January 3, 2009, as follows:

• The consolidated statement of operations included revenue and expenses of CGI from December 30, 2007, through February 11, 2008.

• CGI's income from operations from December 30, 2007, through February 11, 2008, (i.e., the "Acquisition Date") was deducted, 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 average value of Company's common stock on or about the SPA arrangement date, and the direct acquisition costs incurred. The aggregate purchase price of $77,106,830 represents the sum of (i) $64,876,642 which represents cash consideration paid directly to CGI's shareholders, (ii) $8,300,000 deposited in three separate escrows, as described above (iii) $493,196 of deferred acquisition costs paid at closing, (iv) $964,465 of deferred acquisition costs paid prior to closing, and
(v) $2,472,527 for 320,276 shares of common stock that were issued to two executive officers of CGI at closing.

Components of the purchase price distribution are as follows:

[[Image Removed]]                                               [[Image Removed]]
Cash to CGI shareholders                                        $       64,876,642
Cash in escrow                                                           8,300,000
Acquisition costs paid at Closing                                          493,196
Acquisition costs paid prior to Closing                                    964,465
Total                                                                   74,634,303
Issuance of 320,276 shares of common stock at $7.72 per share            2,472,527
Total Purchase Price                                            $       77,106,830

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

[[Image Removed]]                                      [[Image Removed]]
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 13 weeks ended March 29, 2008, and subsequently amended. 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.

During the first three quarters of 2008, additional adjustments to the preliminary purchase price allocation were recorded to goodwill. In the fourth quarter, it became apparent to management after a detailed review of the Information Systems, that the intangible with an original estimated value of $1.197 million identified as software as of the purchase date, was deemed to have no fair value. This resulted in a purchase price adjustment which reclassified $1.197 million of the original fair value of the software to goodwill. In addition, management also adjusted the purchase price allocation after completing a review of the assumptions associated with the Non-Compete Intangible, in which a technical error was discovered in the original valuation. As a result, the Non-Compete Intangible's value was considered to be overstated by $4.727 million and understated goodwill by the like amount. This adjustment was also recorded in the fourth quarter. These adjustments resulted in a reclassification of $5.924 million from identifiable intangibles to goodwill and the deferred tax liability associated with the intangibles along with goodwill were both reduced by $2.366 million.

In the fourth quarter of 2008, the Company, according to SFAS 142, performed its annual goodwill and intangible assets with indefinite lives impairment tests, and determined that all the goodwill and a portion of the remaining intangible assets had been impaired. Consequently, the Company recorded a non-cash charge of $63.9 million for goodwill and $2.66 million for intangible assets impairment during the fourth quarter of 2008, as discussed in this Item under the section entitled "Impairment of Goodwill and Other Intangibles."

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

[[Image Removed]]   [[Image Removed]]      [[Image Removed]]      [[Image Removed]]      [[Image Removed]]
                                                                        Deferred
                        Preliminary           Adjustments to         Tax Liability
                       Allocation at           Preliminary             Adjustment           Final Purchase
                          2/12/08                Purchase           Associated With        Price Allocation
                                             Price Allocation        Final Purchase
                                                                   Price Adjustments
Current assets      $       6,956,000                                                    $       6,956,000
Current assets of
discontinued                  388,000                                                              388,000
operations
Property and                1,394,000                                                            1,394,000
equipment
Intangibles                26,575,000             (5,924,000 )                                  20,651,000
Goodwill                   59,471,020              5,924,000             (2,366,000 )           63,029,020
Current                    (7,441,000 )                                                         (7,441,000 )
liabilities
Current
liabilities of               (132,000 )                                                           (132,000 )
discontinued
operations
Deferred tax              (10,104,020 )                                   2,366,000             (7,738,020 )
Liability
Total fair value
of assets and       $      77,107,000      $               0      $               0      $      77,107,000
liabilities

Impairment to Goodwill and Other Intangibles Goodwill

The Company, during the fourth quarter of 2008, in accordance with SFAS No. 142, performed its annual impairment test for goodwill and intangible assets with an indefinite life. The Company concluded that its market capitalization had been below its net book value for an extended period of time. Management therefore assessed the fair value of its reporting units using both an income approach with a discounted cash flow model and a market approach using the observed market capitalization based on the quoted price of our common stock. Management compared these values to each reporting units' carrying amount, including goodwill and identified an impairment. The evaluation resulted in a $63.910 million impairment charge which was included in the "impairment of goodwill and intangible assets" line item in the consolidated statements of operations.

The changes in the carrying amount of goodwill for the year ending January 3, 2009, are as follows (in thousands):

[[Image Removed]]              [[Image Removed]]
Balance at February 12, 2008   $        63,029
Adjustment to Goodwill                     881
Impairment Charge                      (63,910 )
Balance at January 3, 2009     $             -

Intangible Assets

During 2008, Clark Holdings, Inc. (formerly known as GLAC) acquired The Clark
Group, Inc., resulting in acquisition-related intangible assets.
Acquisition-related intangible assets at January 3, 2009, and February 12, 2008,
as amended, consisted of the following:

[[Image Removed]]   [[Image Removed]]      [[Image Removed]]      [[Image Removed]]      [[Image Removed]]
Amortization             Fair Value            Accumulated             Impairment             Net Value
Period                                         Amortization                                After Impairment
        5           $        1,684,010     $        (247,573 )    $               -      $        1,436,437
        -                    5,378,000                     -             (2,658,000 )             2,720,000
       12                   13,588,000              (998,000 )                    -              12,590,000
                    $       20,650,010     $      (1,245,573 )    $      (2,658,000 )    $       16,746,437

Intangibles assets with an indefinite life (i.e., trade names), were evaluated for impairment at January 3, 2009, by management in accordance with SFAS No. 142, using the "relief from royalty" method. This evaluation resulted in a $2.658 million impairment charge which was included in the "impairment of goodwill and intangible assets" line item in the consolidated statements of operations.

Due to the adverse economic impact on the Company's market capitalization in the fourth quarter, management evaluated intangibles and fixed assets with definite lives for impairment as of January 3, 2009, in accordance with SFAS No. 144. Management's projections of undiscounted future cash flows exceeded the carrying amount of these intangible and fixed assets, which resulted in no charge for impairment. These projections assumed an aggressive growth plan for the international division with 7 new distribution centers and the expansion into the shipment of general commodities. International's percentage of the operating income of the distribution centers before corporate expenses is projected to grow from 6% to 17% during the projection period. Domestic growth projections assume moderate growth during this period with gross profit (net revenue) increasing at 3% per year. During the first 2 years of these projections, we are investing in upgrading our infrastructure.

The impairment in the statement of operations for the year ending January 3, 2009, was calculated as follows (in thousands):

[[Image Removed]]   [[Image Removed]]
Impairment                Amount
Goodwill            $          63,910
Trade names                     2,658
Total                         $66,568

Related-Party Transactions

The Company provides logistics and transportation services for Anderson Merchandisers, LP, related through common ownership. The revenue related to these services was $2,806,000 and $0 for the 53 weeks ended January 3, 2009, and the year ended December 31, 2007, respectively, and is included in gross revenues. Accounts receivable included in the consolidated balance sheet from Anderson Merchandisers, LP, was $333,000 and $0 as of January 3, 2009, and December 31, 2007, respectively.

The Company purchases transportation services from Prologix Distribution Services (East), LLC, related through common ownership. Such purchases were $120,000 and $0 for the 53 weeks ended January 3, 2009, and year ended December . . .