UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q
(Mark One)

[X]      Quarterly report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 For the quarterly period ended March 31, 2006

                                       OR

[ ]      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: 0-27653

                                PACIFIC CMA, INC.
             (Exact Name of Registrant as Specified in Its Charter)

               Delaware                                     84-1475073
--------------------------------------------------------------------------------
     (State or Other Jurisdiction of                    (I.R.S. Employer
     Incorporation or Organization)                     Identification No.)

                    c/o Airgate International Corp., 153-04,
                    Rockaway Blvd., Jamaica, New York 11434
                    (Address of Principal Executive Offices)
                                   (Zip Code)

                                 (212) 247-0049
              (Registrant's Telephone Number, Including Area Code)

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

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

Large accelerated filer [ ]  Accelerated filer [ ]    Non-accelerated filer [X]

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

Yes [ ]   No  [X]

Indicate the number of shares outstanding of each of the Registrant's classes of
common stock, as of the latest practicable date.

Common Stock:  Outstanding as of: May 1, 2006:  27,184,488 shares

<PAGE>

                                PACIFIC CMA, INC.

                               INDEX TO FORM 10-Q
<TABLE>
<CAPTION>
                                                                                  Page No.
                                                                                  --------
PART I.  FINANCIAL INFORMATION
<S>               <C>                                                             <C>
Item 1.           Financial Statements

      Condensed Consolidated Balance Sheets as of March 31, 2006 (Unaudited)
        and December 31, 2005 (Audited)................................................1

      Condensed Consolidated Statements of Operations for the Three Months
        Ended March 31, 2006 and 2005 (Unaudited)......................................3

      Condensed Consolidated Statements of Cash Flows for the Three Months
        Ended March 31, 2006 and 2005 (Unaudited) .....................................4

      Notes to Condensed Consolidated Financial Statements (Unaudited).................5

Item 2.           Management's Discussion and Analysis of Financial
                  Condition and Results of Operations..................................18

Item 3.           Quantitative and Qualitative Disclosures About Market Risk...........35

Item 4.           Controls and Procedures .............................................36


PART II. OTHER INFORMATION

Item 1.           Legal Proceedings ...................................................38

Item 1A.          Risk Factors ........................................................38

Item 2.           Unregistered Sales of Equity Securities and Use of Proceeds .........38

Item 3.           Defaults Upon Senior Securities .....................................38

Item 4.           Submission of Matters to a Vote of Security Holders .................38

Item 5.           Other Information ...................................................38

Item 6.           Exhibits ............................................................38

SIGNATURES ............................................................................40

</TABLE>

<PAGE>

                                PACIFIC CMA, INC.


PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

                                Pacific CMA, Inc.
                      Condensed Consolidated Balance Sheets
                      March 31, 2006 and December 31, 2005
Assets

<TABLE>
<CAPTION>
                                                                                 (Unaudited)
                                                                                    2006                2005
                                                                               ---------------    ---------------
    Current Assets
<S>                                                                           <C>                <C>
        Cash and cash equivalents                                             $      1,376,343   $      2,018,093

        Restricted cash                                                              6,064,992          5,761,246
        Accounts and notes receivable, net of allowance for doubtful
           accounts; 2006 - $255,091;  2005 - $334,014                              17,509,945         17,386,360
        Refundable income taxes                                                         16,263             12,897
        Other receivables                                                            1,604,249          2,476,626
        Deposits and prepaid expenses                                                  718,172            666,976
        Deferred income taxes                                                           58,479             58,479
                                                                               ---------------    ---------------
               Total current assets                                                 27,348,443         28,380,677
                                                                               ---------------    ---------------

    Property and Equipment, net of accumulated depreciation; 2006 -
       $1,061,954; 2005 - $967,296                                                     881,869            800,596
                                                                               ---------------    ---------------

    Other Assets
        Goodwill                                                                     3,755,393          3,240,807
        Intangible assets, net of accumulated amortization; - 2006 -
          $2,269,823; 2005 - $2,118,718                                                881,757            982,216
        Deferred income taxes                                                        1,539,222            992,115
        Deferred financing costs on Series A preferred stock                           406,481            508,035
        Deferred financing costs on minimum borrowing and revolving
          notes                                                                        484,146            502,480
        Investment deposit                                                             450,000            100,000
        Equity investment in affiliates                                              1,041,006          1,051,628
                                                                               ---------------    ---------------
                                                                                     8,558,005          7,377,281
                                                                               ---------------    ---------------

                                                                              $     36,788,317   $     36,558,554
                                                                               ===============    ===============
Liabilities and Stockholders' Equity

    Current Liabilities
        Notes payable - bank and revolving note                               $      5,029,865   $      4,989,166
        Current maturities of capital lease obligations                                 60,466             60,465
        Accounts payable                                                            11,937,657         11,560,890
        Payable-minority shareholder                                                   150,120            150,120
        Accrued expenses                                                             1,071,460          1,301,316
        Short-term loan payable                                                        222,662            315,325
        Income taxes payable                                                           163,422            106,003
                                                                               ---------------    ---------------
               Total current liabilities                                            18,635,652         18,483,285
                                                                               ---------------    ---------------

    Capital Lease Obligations                                                           43,852             58,969
                                                                               ---------------    ---------------

    Minimum Borrowing Note, net                                                      3,515,346          3,504,912
                                                                               ---------------    ---------------

    Series A Preferred Stock, net                                                    1,760,767          1,833,968
                                                                               ---------------    ---------------

    Minority Interest                                                                  143,615            178,789
                                                                               ---------------    ---------------
    Stockholders' Equity
        Common stock, no par value; authorized - 100,000,000 shares and
          issued - 2006 - 27,184,488 shares and 2005 - 26,412,437 shares             4,534,961          5,477,953
        Treasury common stock, at cost, 2006 - 41,800 shares; 2005 -
          32,900 shares                                                                (32,623)           (24,827)
        Warrants outstanding                                                         1,551,403          1,551,403
        Additional paid-in capital                                                   4,697,532          4,098,214
        Retained earnings                                                            1,901,915          2,403,677
        Accumulated other comprehensive income                                          35,897             35,897
        Unearned compensation cost                                                          --         (1,043,686)
                                                                               ---------------    ----------------
               Total stockholders' equity                                           12,689,085         12,498,631
                                                                               ---------------    ---------------

                                                                              $     36,788,317   $     36,558,554
                                                                               ===============    ===============
</TABLE>

See Notes to Condensed Consolidated Financial Statements                       1

<PAGE>

                                Pacific CMA, Inc.
                 Condensed Consolidated Statements of Operations
                   Three Months Ended March 31, 2006 and 2005
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                   2006                2005
                                                                               ---------------    ---------------
<S>                                                                           <C>                <C>
    Freight Forwarding Income                                                 $     30,429,925   $     25,604,545
                                                                               ---------------    ---------------
    Operating Expenses
        Cost of forwarding                                                         (25,750,270)       (21,508,127)
        General and administrative                                                  (4,562,123)        (3,561,895)
        Depreciation and amortization                                                 (246,565)          (222,526)
        Stock-based compensation cost                                                  (34,912)          (101,102)
                                                                               ----------------   ----------------
                                                                                   (30,593,870)       (25,393,650)

    Operating Income (Loss)                                                           (163,945)           210,895
                                                                               ----------------   ---------------
    Other Income (Expense)
        Interest and other income                                                      102,750             35,141
        Interest expenses                                                             (186,626)          (114,352)
        Preferred stock dividend and amortization of deferred financing
          costs                                                                       (165,055)          (137,155)
        Amortization of preferred stock discount                                       (99,427)           (58,732)
        Preferred stock beneficial conversion                                         (427,372)                 --
        Minimum borrowing note and revolving note amortization of
          deferred financing costs                                                     (18,334)                 --
        Amortization of minimum borrowing note and revolving note
          discount                                                                     (10,434)                 --
        Equity in loss of affiliates                                                   (10,621)           (11,801)
                                                                               ----------------   ----------------
                                                                                      (815,119)          (286,899)
                                                                               ----------------   ----------------

    Loss Before Income Taxes                                                          (979,064)           (76,004)

    Benefit for Income Taxes                                                          (483,705)          (144,143)
                                                                               ----------------   ----------------

    Income (Loss) Before Minority Interest                                            (495,359)            68,139

    Minority Interest                                                                   (6,403)            (5,711)
                                                                               ----------------   ----------------

    Net Income (Loss)                                                         $       (501,762)  $         62,428
                                                                               ================   ===============

    Basic Earnings Per Share                                                  $          (0.02)  $           0.00
                                                                               ===============    ===============

    Diluted Earnings Per Share                                                $          (0.02)  $           0.00
                                                                               ===============    ===============
</TABLE>


See Notes to Condensed Consolidated Financial Statements                       3

<PAGE>

                                Pacific CMA, Inc.
                 Condensed Consolidated Statements of Cash Flows
                   Three Months Ended March 31, 2006 and 2005
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                    2006                2005
                                                                               --------------     --------------
    Operating Activities
<S>                                                                           <C>                <C>
        Net income (loss)                                                     $      (501,762)   $        62,428
        Items not requiring (providing) cash
           Amortization of preferred stock discount                                    99,427             58,732
           Preferred stock dividend and amortization of deferred
              financing costs                                                         166,655            137,155
           Preferred stock beneficial conversion                                      427,372                 --
           Amortization of minimum borrowing note and revolving note
              discount and deferred financing costs                                    28,768                 --
           Depreciation and amortization                                               95,461             78,191
           Amortization of intangibles                                                151,104            144,335
           Common stock issued for services and employee compensation                  34,912            101,102
           Deferred income taxes                                                     (555,969)          (209,677)
           Other                                                                       17,018             30,708
        Changes in
           Accounts receivable                                                       (123,584)            64,354
           Accounts payable                                                           376,767           (720,676)
           Accrued expenses                                                          (229,856)          (186,580)
           Income taxes refundable/payable                                             54,052             62,009
           Other assets and liabilities                                               821,181              8,479
                                                                               --------------     --------------
               Net cash provided by operating activities                              861,546           (369,440)
                                                                               --------------     ---------------

    Investing Activities
        Collection of loans receivable                                                     --                640
        Purchase of property and equipment                                           (176,734)          (124,998)
        Proceeds from sale of property and equipment                                        6              5,256
        Deposit refund (paid) for potential equity investment                        (350,000)            40,000
        Acquisition of subsidiary                                                    (597,945)                 --
                                                                               ---------------    ---------------
               Net cash used in investing activities                               (1,124,673)           (79,102)
                                                                               ---------------    ---------------
    Financing Activities
        Net change in restricted cash                                                (303,746)        (1,202,914)
        Net change in notes payable - bank                                            156,899          1,797,108
        Principal payments under capital lease obligation                             (15,116)           (16,753)
        Proceeds from short-term debt                                                      --             72,683
        Principal payments in other loan                                              (92,663)                 --
        Principal payments of revolving note                                         (116,201)                 --
        Repurchase of common stock                                                     (7,796)                 --
                                                                               ---------------    ---------------
               Net cash provided by financing activities                             (378,623)           650,124
                                                                               ---------------    --------------
    Increase (Decrease) in Cash and Cash Equivalents                                 (641,750)           201,582

    Foreign Currency Exchange Difference                                                   --             (2,310)

    Cash and Cash Equivalents, Beginning of Period                                  2,018,093          1,538,146
                                                                               --------------     --------------

    Cash and Cash Equivalents, End of Period                                  $     1,376,343    $     1,737,418
                                                                               ==============     ==============

    Supplemental Cash Flow Information
        Interest paid                                                         $       186,626    $       114,352
</TABLE>


See Notes to Condensed Consolidated Financial Statements                       4

<PAGE>


                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)

Note 1:  Basis of Presentation

        The accompanying condensed consolidated financial statements of Pacific
        CMA, Inc. (the "Company") and its subsidiaries (the "Group") as of March
        31, 2006 and for the three months ended March 31, 2006 and 2005 have
        been prepared in accordance with accounting principles generally
        accepted in the United States of America for interim financial
        information and with the instructions to Form 10-Q and Article 10 of
        Regulation S-X of the Securities Exchange Act of 1934. Accordingly, they
        do not include all of the information and footnotes required by
        accounting principles generally accepted in the United States of America
        for complete financial statements. The accompanying unaudited condensed
        consolidated financial statements reflect all adjustments that are in
        the opinion of the Company's management, necessary to fairly present the
        financial position, results of operations and cash flows of the Company.
        Those adjustments consist only of normal recurring adjustments.

        The condensed consolidated balance sheet of the Company as of December
        31, 2005 has been derived from the audited consolidated balance sheet of
        the Company as of that date.

        The condensed consolidated statements of operations for the three months
        ended March 31, 2006 and 2005, and cash flows for the three months ended
        March 31, 2006 and 2005 are not necessarily indicative of the results
        that may be expected for the entire year. These condensed consolidated
        financial statements should be read in conjunction with the consolidated
        financial statements and the related notes thereto for the year ended
        December 31, 2005 included in the Company's Form 10-K filed on March 31,
        2006.

    Principles of Consolidation

        The condensed consolidated financial statements include the financial
        statements of the Company and its subsidiaries. All significant
        intercompany balances and transactions have been eliminated in
        consolidation.


    Cash Equivalents

        The Company considers all liquid investments with original maturities of
        three months or less to be cash equivalents. At March 31, 2006, cash
        equivalents consisted primarily of money market accounts with brokers
        and certificates of deposit. At March 31, 2006, the Company's cash
        accounts in the United States of America exceeded federally insured
        limits by approximately $1,030,000.

                                                                               5

<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)


    Restricted Cash

        Restricted cash consists of fixed deposits, collateral deposits and
        certificates of deposit held by banks providing collateral for
        overdraft, trust receipts, letters of credit and support bank guarantees
        provided to certain vendors of the Company. At March 31, 2006, the
        restricted cash held for these facilities amounted to $5,324,054. The
        restricted cash also includes cash held in lockbox account for financing
        the loan arrangement of the minimum borrowing note and the revolving
        note with details discussed in Note 7. As of March 31, 2006, the cash
        held in the lockbox account amounted to $740,938 under the compensating
        balance arrangement.



Note 2:  Investment Deposit

        At March 31, 2006, the Company had deposited $100,000 with a potential
        acquisition target in the United States. The Company has a signed letter
        of intent with the target. The estimated purchase price is $1,000,000 to
        $1,500,000.

        Also, at March 31, 2006, the Company entered into a Stock Purchase
        Agreement with HTL Logistics Limited, a Cayman Island corporation
        ("HTL"), pursuant to which the Company has agreed to acquire seventy
        percent (70%) of the outstanding shares of capital stock of HTL for a
        purchase price consisting of (i) $1,330,000 and (ii) 2,800,000 shares of
        the Company's restricted Common Stock. The Company has also been granted
        an option to purchase the remaining thirty percent (30%) of HTL's
        outstanding shares of capital stock, which may be exercised by the
        Company's paying (i) $570,000 and (ii) depending upon certain factors,
        up to an additional 2,200,000 shares of Common Stock. In addition, the
        Company has agreed to issue to HTL's shareholders, for the years ended
        December 31, 2006, 2007 and 2008, a total of up to 750,000 additional
        shares of Common Stock per year, based on HTL's net profits for those
        years, and provided that such net profits are equal to or greater than
        $500,000, with respect to each of those years. The Company has deposited
        $350,000 with HTL to be applied to the purchase price at the closing of
        the transaction. HTL is a holding company which owns a series of
        operating subsidiaries in the freight forwarding business throughout
        India and Sri Lanka.

                                                                               6

<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)


Note 3:  Earnings Per Share

        The following is a reconciliation of the numerator and denominator of
basic and diluted earnings per share:

<TABLE>
<CAPTION>
                                                                    (Unaudited)
                                                            Three Months Ended March 31
                                                   2006                                     2005
                                                 Weighted                              Weighted
                                                  Average     Per-Share                 Average
                                      Loss        Shares       Amount       Income      Shares    Per-Share Amount
--------------------------------------------------------------------------------------------------------------------
<S>                                <C>                                     <C>
      Net (Loss) Income            $ (501,762)                             $62,428

      Basic EPS
        Income (loss) available
          to common stockholders     (501,762)    26,693,517  $    (0.02)   62,428      25,207,654     $     0.00
                                                              ===========                              ==========
        Stock options and
          warrants                                         --                              179,097
                                                    ---------                              -------

      Diluted EPS
        Income (loss) available
          to common stockholders
          and assumed conversions  $ (501,762)    26,693,517  $    (0.02)  $62,428      25,386,751     $     0.00
                                   ===========    =========== ===========  =======       ==========    ==========
</TABLE>


        Common stock equivalents related to warrants, convertible preferred
        stock and minimum borrowing and revolving note of 4,385,788, 4,375,000
        and 4,499,459 shares, respectively, are not included in the calculation
        of dilutive earnings per share for the three months ended March 31, 2006
        because they have an anti-dilutive effect.

        Common stock equivalents related to warrants and convertible preferred
        stock of 2,835,788 and 3,472,222 shares, respectively, are not included
        in the calculation of dilutive earnings per share for the three months
        ended March 31, 2005 because they have an anti-dilutive effect.



Note 4:  Common Stock and Preferred Stock

        As of March 31, 2006, the Company's authorized capital stock was
        comprised of 100,000,000 shares of common stock, $0.001 par value and
        10,000,000 shares of preferred stock, $0.001 par value. As of the same
        date, the Company's issued capital stock was comprised of 27,184,488
        shares of common stock and 5,000 shares of preferred stock; 27,184,488
        shares of common stock and 3,850 shares of preferred stock are
        outstanding.

                                                                               7

<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)


    Preferred Stock

        On April 14, 2004, the Company sold to two institutional investors
        $3,000,000 of its Series A Preferred Stock and issued warrants to
        purchase 937,500 shares of common stock, at per share exercise prices of
        $1.76 for 468,750 shares and $2.00 for 468,750 shares. These warrants
        expire seven years from date of issuance.

        On May 6, 2004, the Company sold to an institutional investor $2,000,000
        of its Series A Preferred Stock and issued warrants to purchase an
        additional 625,000 shares of common stock at per share exercise prices
        of $1.76 for 312,500 shares and $2.00 for 312,500 shares. These warrants
        expire seven years from issuance.

        The Series A Preferred Stock has 10,000,000 shares authorized and 5,000
        shares issued with a stated value of $1,000 per share. The Series A
        Preferred Stock is convertible into shares of Common Stock at a
        conversion price of $1.44 per share and pays a cumulative annual
        dividend equal to six (6%) percent of the stated value, which at the
        option of the Company, subject to certain conditions, may be paid in
        shares of Common Stock. The Series A Preferred Stock is mandatorily
        redeemable four years from issuance. This preferred stock is non-voting.

       On August 4, 2005, the Company completed a financing transaction
       described in note 7 "Revolving Note and Minimum Borrowing Note". The
       Notes contain a conversion feature whereby the Notes can be converted to
       common stock. The conversion price of the first $3,750,000 is convertible
       at $0.88 per share and the balance is convertible at $1.05. Pursuant to
       the Certificate of Designation of Preferences Rights and Limitations of
       Series A Convertible Preferred Stock of the Company executed April 12,
       2004, and the Common Stock Purchase Warrants issued to the purchasers of
       the Company's Series A Convertible Preferred Stock, the Set Price of the
       Series A Convertible Preferred Stock and the exercise price of the
       Purchases Warrants, has been adjusted to $0.88 per share accordingly. In
       accordance with EITF 00-27 and EITF 05-8, the intrinsic value of the
       additional beneficial conversion option of $2,659,091 was recorded as
       unamortized discount on the preferred stock and as additional
       stockholders' equity (warrants outstanding) of $1,595,455 and deferred
       income taxes of $1,063,636 on the date of conversion price resetting. The
       additional unamortized discount is amortized to expense using the
       effective interest method over the remaining life of the Series A
       Preferred Stock and the deferred tax liability is included in tax expense
       as the interest expense is recognized. As a result, $427,372 was expensed
       as amortization from the additional beneficial conversion for Series A
       Preferred Stock during the first quarter of 2006.

                                                                               8

<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)



    Preferred Stock (continued)


       One of the institutional investors converted shares of the Series A
       Preferred Stock into shares of Common Stock at a conversion price of
       $0.88 per share on the following dates:-

                                        Number of Series A Preferred
       Date of conversion                     Stock converted
          August 16, 2005                                      250
          November 10, 2005                                    300
          January 25, 2006                                     300
          March 30, 2006                                       300
                                                   ----------------
              Total converted                                1,150
                                                   ================


        The outstanding Series A Preferred Stock is redeemable in 2008. The
        redeemable amounts and unamortized discounts are as follows:

                                   March 31, 2006       December 31, 2005
          Redeemable amount       $     3,850,000        $     4,450,000
          Unamortized discount         (2,089,233)            (2,616,032)
                                  ----------------       ----------------
                Carrying value    $     1,760,767       $     1,833,968
                                  ===============        ===============

       As the Series A Preferred Stock is mandatorily redeemable, it was
       recorded in accordance with Statement 150, Accounting for Certain
       Financial Instruments With Characteristics of Both Liabilities and
       Equity. The relative fair value of the Series A Preferred Stock was
       recorded as a long-term liability and the dividends paid and accrued are
       included in interest expense. Additionally, the Series A Preferred Stock
       was issued with a beneficial conversion feature. In accordance with EITF
       98-5, the intrinsic value of the beneficial conversion option of $166,666
       was recorded as additional finance charges under the caption "Preferred
       Stock dividend and amortization of deferred financing costs" and credited
       to additional paid-in capital year ended December 31, 2004. Lastly, in
       accordance with Opinion 14, Accounting for Convertible Debt and Debt
       Issued With Stock Purchase Warrants, the Series A Preferred Stock and
       detachable stock warrants were recorded at their relative fair values
       with the value of the warrants recorded as additional paid-in capital.
       The fair value of the warrants was determined based on an independent
       valuation. Effectively, the Series A Preferred Stock was recorded at an
       original discount of $939,713. This discount will be amortized ratably
       over the term of the Series A Preferred Stock. For the three months ended
       March 31, 2006 and 2005, the Company recognized $99,427 and $58,732
       respectively related to the amortization of the Series A Preferred Stock
       original discount.

        In connection with the issuance of the Series A Preferred Stock, the
        Company incurred $958,951 of finance costs. These costs have been
        recorded as an asset and are amortized over the term of the preferred
        stock. For the three months ended March 31, 2006 and 2005, the Company
        recognized $101,555 and $59,100 respectively related to the amortization
        of the Series A Preferred Stock deferred financial cost.


        Future amortization of the deferred financing costs and preferred stock
        discount is as follows:


                  April 1, 2006 to December 31, 2006   $  236,728
                  2007                                    466,383
                  2008                                    200,673


                                                                               9
<PAGE>


                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)


    Stock Based Compensation

        The Company has a 2000 Stock Plan ("Plan") to issue stock options and
        grants pursuant to various agreements with employees, service providers,
        business associates and others that will have an important business
        relationship with the Company or its affiliates. The maximum number of
        shares of the Company's common stock available for issuance under the
        Plan is 2,200,000 shares. As of March 31, 2006, the maximum number of
        shares available for future grants under the Plan was 1,025,442 shares.
        The options and stock grants vest over an 18-month period. At March 31,
        2006 and for the three months ended there no options or grants
        outstanding or issued under this plan.

        From time to time, the Company has issued other restricted stock grants
        that are being recognized as compensation expense ratably over the
        vesting period on a straight line basis. As of March 31, 2006 there were
        900,000 grant shares unvested with unearned compensation of $1,008,774.
        Compensation expense recognized during the three months ended March 31,
        2006 and 2005 was $34,912 and $101,102.

        The Company, effective January 1, 2006, adopted Statement of Financial
        Accounting Standards No. 123R (FAS 123R), "Share-Based Payments" using
        the modified prospective application method for transition. Accordingly,
        prior year amounts have not been restated. The transition did not have a
        material effect on earnings for the three months ended March 31, 2006.
        Previously, the unearned compensation related to restricted stock grants
        was recorded as a contra equity account. Under the provisions of FAS
        123R, paragraph 74, this unearned compensation is now recorded against
        the common stock and continue to be amortized. This reclassification is
        reflected in the balances of common stock as of March 31, 2006.

        Certain other disclosures required under FAS 123R and SAB107 have not
        been made as they are not material.

    Treasury Stock

        Based on a resolution of the Board of Directors in October 2005, the
        Company authorized the repurchase of shares of its outstanding Common
        Stock, in an aggregate amount not to exceed $500,000. As of March 31,
        2006, 41,800 shares of common stock totaling $32,623 have been
        repurchased and reflected at cost as a reduction from stockholders'
        equity.

Note 5:  Pledge of Assets

        As of March 31, 2006 and December 31, 2005, the Group had pledged
        restricted cash deposits of $6,064,992 and $5,761,246 respectively.



                                                                              10

<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)


Note 6:  Notes Payable - Bank and Revolving Notes

        Short-term borrowings and weighted average interest rates at March 31,
2006 and December 31, 2005, were:

<TABLE>
<CAPTION>
                                                          March 31, 2006                  December 31, 2005
                                                 ----------------------------------------------------------------
                                                    Weighted          Amount         Weighted          Amount
                                                     Average                          Average
                                                    Interest                         Interest
                                                      Rate                             Rate
                                                 ----------------------------------------------------------------

<S>                                                          <C>    <C>                      <C>      <C>
           Bank Overdraft and Trust Receipts                 7.55%  $  5,029,865             7.26%    $ 4,872,965

           Revolving note (see Note 7)                         --             --             8.25%       116,201
                                                    -------------   ------------     -------------  -------------

                                                             7.55%  $  5,029,865             7.29%    $ 4,989,166
                                                    =============   ============     =============  =============
</TABLE>

        The Company has certain banking facilities to finance its working
        capital. The facilities available totaled approximately $9,419,000 at
        March 31, 2006. The facilities accrue interest at rates varying with the
        prime rate in Hong Kong, Hong Kong Interbank Offered Rate (HIBOR), or
        the cost of funds rate. As of March 31, 2006, these rates ranged between
        4.05% - 9.25%. The facilities require annual renewals and are
        collateralized by personal guarantees of two directors and restricted
        cash of approximately $4,979,000. As of March 31, 2006 and December 31,
        2005, amounts outstanding against these facilities were $5,029,865 and
        $4,872,965, respectively.

Note 7:  Revolving Notes and Minimum Borrowing Notes

        Effective August 4, 2005, the Company completed a financing transaction
        with Laurus Master Fund, Ltd. ("Laurus") pursuant to the terms of a
        Security Agreement (the "Security Agreement"), dated as of July 29,2005,
        by and among the Company, certain of the Company's United States
        subsidiaries (the "Subsidiaries"), and Laurus (the "Financing").
        Pursuant to the Security Agreement, the Company issued and sold to
        Laurus (i) a Secured Convertible Minimum Borrowing Note (the "Minimum
        Borrowing Note") in the principal amount of $4 million, which is
        convertible into shares of the Company's common stock, par value $0.001
        per share (the "Common Stock"), and (ii) a Secured Revolving Note (the
        "Revolving Note," and, together with the Minimum Borrowing Note, the
        "Notes"), which Notes are in the aggregate principal amount of $7.5
        million. The Revolving Note also is convertible into shares of Common
        Stock. The Company also issued to Laurus a warrant (the "Warrant") to
        purchase, at any time prior to July 29, 2012, up to 1,500,000 shares of
        Common Stock at a purchase price of $1.00 per share, subject to
        adjustments. The issuance of the Notes and the Warrant were completed in
        a private placement pursuant to an exemption from registration under
        Section 4(2) of the Securities Act of 1933, as amended.


                                                                              12
<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)



    Revolving Notes and Minimum Borrowing Notes (continued)

        The Notes are due on July 29, 2008 The interest rate on the Notes is
        equal to the greater of (i) six percent (6%), and (ii) the prime rate
        plus one percent (1)%. The interest rate may be adjusted downward
        depending on (i) whether the Company has registered the shares of Common
        Stock underlying the Minimum Borrowing Note, and the Warrant, and (ii)
        the price of the Common Stock.

        Amounts outstanding under the Minimum Borrowing Note and the Revolving
        Note will either be paid in cash at maturity or at Laurus' option, by
        converting such amounts into shares of the Common Stock from time to
        time.

        The maximum amount available under the Revolving Note and the Minimum
        Borrowing Note is equal to the lesser of (i) $7.5 million less any
        reserves required by Laurus; or (ii) 90% of the Eligible Accounts (as
        defined in the Security Agreement) less any reserves required by Laurus.
        If at any time the amount outstanding under the Revolving Note is equal
        to or greater than $500,000 and the amount outstanding under the Minimum
        Borrowing Note is less than $4 million, then the outstanding amount of
        the Revolving Note will be segregated until aggregate segregated amounts
        under the Revolving Note equals $4 million, at which time a new Minimum
        Borrowing Note in the same form of the initial Minimum Borrowing Note
        will be issued and the Revolving Note reduced correspondingly.

        The initial fixed conversion price of the Notes is $0.88 per share with
        respect to the first $3,750,000 of aggregate principal amount converted
        and $1.05 per share for any additional amount of principal converted and
        is subject to certain anti-dilution adjustments.

        As of March 31, 2006, the outstanding balance of the Minimum Borrowing
        Notes, net of discount, is $3,515,346 and the unamortized discount is
        $484,654.

        As required by the Registration Rights Agreement related to the
        financing transaction, the Company filed a registration statement with
        the Securities and Exchange Commission ("Commission") for the shares of
        our Common Stock issuable upon conversion of our debt to Laurus and
        exercise of the Laurus warrants. During the Commission's comment process
        for that registration statement, it appeared that the Commission would
        not declare the registration statement effective. The Company believes
        that the rollover feature of the agreement was viewed as an
        impermissible continuation of a private offering while in registration.
        As a result, the Company filed an application to withdraw the
        registration statement with the Commission. The agreements with Laurus
        contained monetary penalty provisions, if among other things, the
        registration statement did not become effective by a certain date that
        has now passed. Laurus has waived all penalties.

        Effective May 2, 2006, the Company completed the restructuring the
        transaction with Laurus. The following material changes were made to the
        Laurus Credit Facility:

                                                                              13
<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)



    Revolving Notes and Minimum Borrowing Notes (continued)

        Conversion Feature: The conversion feature of the financing has been
        limited to the conversion of the Secured Convertible Minimum Borrowing
        Note in the principal amount of $4 million, which is convertible into
        shares of the Company's common stock at fixed conversion rates of $0.88
        per share with respect to the first $3,750,000 and $1.05 per share with
        respect to the remaining $250,000.

        Additional Warrant: In connection with the restructuring of the
        financing, the Company issued an additional warrant to Laurus providing
        Laurus the right to purchase up to an additional 350,000 shares of
        Common Stock at an exercise price of $0.88 per share.

        Registration Rights: Pursuant to the terms of an Amended Registration
        Rights Agreement, dated as of May 2, 2006, by and between the Company
        and Laurus, the Company agreed to file, by June 1, 2006, a registration
        statement to cover the resales of the shares of Common Stock issuable
        upon conversion of the Secured Convertible Minimum Borrowing Note and
        both warrants issued to Laurus, and to have such registration statement
        declared effective by August 30, 2006. Any prior penalties relating to
        the Company's inability to register shares of common stock for resale
        have been waived.

        All other material terms of the financing, which can be found in the
        Company's Current Report on Form 8-K filed with the Securities and
        Exchange Commission on August 4, 2005, remain unchanged and in full
        force and effect.



Note 8:  Related Party Transactions

        As of March 31, 2006 and December 31, 2005, the Company had a payable to
        a minority shareholder of a subsidiary of $150,120. The payable accrues
        interest at 3% per annum, is unsecured and has no fixed payment terms.


                                                                              14
<PAGE>



                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)

Note 9:  Segment of the Business


    Business Segments

        The Company operates mainly in two business segments. Those segments are
        air forwarding and sea forwarding services. The accounting policies
        adopted by the Company for segment reporting are described in the
        summary of significant accounting policies in the Company's Form 10-K
        filed for the year ended December 31, 2005.

        The following table summarized the Company's operations for the three
        months ended March 31, 2006 and 2005 analyzed into air and sea
        forwarding services:

<TABLE>
<CAPTION>
                                        Air Forwarding               Sea Forwarding                  Total
                                          (Unaudited)                 (Unaudited)                 (Unaudited)
                                 --------------------------------------------------------------------------------------
                                      2006          2005           2006          2005          2006          2005
                                 --------------------------------------------------------------------------------------
<S>                                <C>           <C>            <C>           <C>           <C>           <C>
          Revenues                 $ 19,950,405  $15,718,901  $10,479,520   $ 9,885,644   $30,429,925   $25,604,545
          Cost of forwarding        (16,622,054) (12,864,037)  (9,128,216)   (8,644,090)  (25,750,270)  (21,508,127)
          Depreciation and
             amortization              (152,050)    (136,119)     (94,515)      (49,039)     (246,565)     (185,158)
          Interest income                34,833           --            2            --        34,835             --
          Interest expense              (62,337)     (48,181)        (473)       (8,434)      (62,810)      (56,615)
          Other segment expenses
             attributable to
             segment                 (1,232,970)    (960,341)    (592,422)     (535,393)   (1,825,392)   (1,495,734)
                                    -----------   -----------   -----------   -----------   -----------   -----------


          Segment income           $  1,915,827  $ 1,710,223  $   663,896   $   648,688     2,579,723     2,358,911
                                    ===========   ==========   ==========    ==========
          Net other unallocated
             expenses                                                                      (3,075,082)   (2,290,772)


          Minority interest                                                                    (6,403)       (5,711)
                                                                                           -----------   -----------


          Net income (loss)                                                               $  (501,762)  $    62,428
                                                                                           ===========   ==========


          Goodwill                 $  2,862,979  $ 1,687,471  $   892,414   $ 1,053,037   $ 3,755,393   $ 2,740,508
          Intangible assets             685,861      744,967      195,896       468,512       881,757     1,213,479
          Other assets               23,310,190   21,389,065    8,840,977     7,258,380    32,151,167    28,647,445
                                    ----------    ----------   ----------    ----------    ----------    ----------


                 Total assets      $ 26,859,030  $23,821,503  $ 9,929,287   $ 8,779,929   $36,788,317   $32,601,432
                                    ===========   ==========     ==========    ==========    ==========    ==========
</TABLE>



                                                                              15



<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)


    Geographical Segments

        The table below summarized the Company's revenues during the three
        months ended March 31, 2006 and 2005 analyzed into geographical
        locations:

                                                 (Unaudited)
                                         Three Months Ended March 31
                                   ----------------------------------------
                                           2006               2005
                                   ----------------------------------------
             Revenues
                 * IATA Area 1       $      3,446,612    $      4,089,253
                 * IATA Area 2              5,813,493           6,157,664
                 * IATA Area 3             21,169,820          15,357,628
                                      ---------------     ---------------

                    Total            $     30,429,925    $     25,604,545
                                      ===============     ===============

        The table below summarized the Company's assets as of March 31, 2006 and
2005 analyzed into geographical locations:


<TABLE>
<CAPTION>
                                                 (Unaudited)                                    (Unaudited)
                                            As of March 31, 2006                           As of March 31, 2005
                                                Other Assets                                   Other Assets
                                   Trade         (Including        Total          Trade         (Including         Total
                                 Receivables      Goodwill)        Assets       Receivables      Goodwill)        Assets
                               -----------------------------------------------------------------------------------------------
          Assets
<S>                    <C>       <C>             <C>             <C>            <C>             <C>            <C>
            *IATA Area 1         $ 7,317,070     $ 13,291,131    $ 20,608,201   $ 7,101,504     $  8,879,902   $ 15,981,406
            *IATA Area 2           4,002,414               --       4,002,414     2,566,209               --      2,566,209
            *IATA Area 3           6,190,461        5,987,241      12,177,702     3,738,764       10,315,053     14,053,817
                                  ----------      -----------     -----------    ----------      -----------    -----------

                 Total           $17,509,945     $ 19,278,372    $ 36,788,317   $13,406,477     $ 19,194,955   $ 32,601,432
                                  ==========      ===========     ===========    ==========      ===========    ===========
</TABLE>


        *  IATA Area 1 comprises all of the North and South American Continent
           and adjacent islands, Greenland, Bermuda, West Indies and the islands
           of the Caribbean Sea, the Hawaiian Islands (including Midway and
           Palamyra).

        *  IATA Area 2 comprises all of Europe (including the European part of
           the Russian Federation) and the adjacent islands, Iceland, the
           Azores, all of Africa and the adjacent islands, Ascension Island,
           that part of Asia lying west of and including Iran.

        *  IATA Area 3 comprises all of Asia and the adjacent islands, except
           that portion included in IATA Area 2, all of the East Indies,
           Australia, New Zealand and the adjacent islands, the islands of the
           Pacific Ocean, except those included in IATA Area 1.

                                                                              16
<PAGE>

                                Pacific CMA, Inc.
              Notes to Condensed Consolidated Financial Statements
                             March 31, 2006 and 2005
                                   (Unaudited)

Note 10: Equity Investment in Affiliates

        Equity investment in affiliates relates to ownership of Shanghai Air
        Cargo Ground Handling Services Ltd. ("Shanghai Air Cargo"), Vantage
        Point Services Limited ("Vantage Point") and Careship International
        Transportation Ltd. ("Careship International") for 35%, 40% and 46.92%
        respectively. Shanghai Air Cargo began operations in April 2004 and the
        interest in Vantage Point and Careship International was acquired by the
        Company in October 2004 and January 2005 respectively. Financial results
        of operations of the affiliates during the three months ended March 31,
        2006 are summarized below:

<TABLE>
<CAPTION>
                                                               (Unaudited)
                                                            Three months ended
                                                              March 31, 2006
                                              Shanghai Air                       Careship
                                                 Cargo        Vantage Point    International
                                            ---------------------------------------------------
<S>                                           <C>             <C>              <C>
        Net Sales                             $   288,714     $   192,093      $   12,570
        Cost of Sales                             227,419         151,240           7,997
        Gross Profit                               61,296          40,853           4,573
        Net Income (Loss)                          13,340          (2,976)        (28,705)
        Equity in Income (Loss) of
          Affiliates                                4,669          (1,190)        (13,468)
</TABLE>

        The Company invested $846,847 in its 46.92% interest in Careship
        International which amount was $792,453 in excess of the underlying
        equity in net assets of the investee. This excess was allocated to an
        intangible asset of $535,558 and the balance of $256,895 to goodwill.
        The intangible asset related to an exclusive right to do business
        granted to Careship International by the government of the Peoples
        Republic of China for a term of ten years. The intangible is being
        amortized over the term of the exclusive right. The amortization expense
        is reflected in the equity in income (loss) of affiliates and amounted
        to $632 for the quarter ended March 31, 2006. The goodwill is not
        amortized under Statement No. 142 but rather the investment is analyzed
        for impairment under the requirements of Opinion No. 18.

Note 11: Business Acquisitions

        At February 28, 2006, the Company acquired the balance of 49% of the
        outstanding stock of WCL Global Logistics Ltd. ("WCL") for $597,945 and
        in turn WCL became a wholly owned subsidiary of the Company. WCL is a
        non-asset based logistics services company based in Hong Kong. It also
        has a branch office in Guangzhou, PRC, which handles both air and ocean
        shipments all over the World. Goodwill and intangible assets of $514,586
        and $50,646, respectively, were recognized in this transaction.

        The above transaction was recorded using the purchase method of
        accounting. The results of operations are included in the consolidated
        financial statement since the date of acquisition. Assets and
        liabilities were recorded based on fair values. The purchase price in
        excess of net identified tangible and intangible assets acquired is
        accounted in accordance to FASB Statement No. 141.

                                                                              17

<PAGE>

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations

Special Note of Caution Regarding Forward-Looking Statements

Certain statements in this report, including statements in the following
discussion, which are not statements of historical fact, are what are known as
"forward-looking statements," which are basically statements about the future.
For that reason, these statements involve risk and uncertainty since no one can
accurately predict the future. Words such as "plans," "intends," "hopes,"
"seeks," "anticipates," "expects," and the like, often identify such
forward-looking statements, but are not the only indication that a statement is
a forward-looking statement. Such forward-looking statements include statements
concerning our plans and objectives with respect to the present and future
operations of the Company, and statements, which express or imply that such
present and future operations will, or may, produce revenues, income or profits.
Numerous factors and future events could cause the Company to change such plans
and objectives, or fail to successfully implement such plans or achieve such
objectives, or cause such present and future operations to fail to produce
revenues, income or profits. Therefore, the reader is advised that the following
discussion should be considered in light of the discussion of risks and other
factors contained in this report on Form 10-Q and in the Company's other filings
with the SEC including, but not limited to, its Annual Report on Form 10-K. No
statements contained in the following discussion should be construed as a
guarantee or assurance of future performance or future results.

These forward-looking statements are based largely on our current expectations,
assumptions, plans, estimates, judgments and projections about our business and
our industry, and they involve inherent risks and uncertainties. Although we
believe that these forward-looking statements are based upon reasonable
estimates, judgments and assumptions, we can give no assurance that our
expectations will in fact occur or that our estimates, judgments or assumptions
will be correct, and we caution that actual results may differ materially and
adversely from those in the forward-looking statements. Forward-looking
statements involve known and unknown risks, uncertainties, contingencies and
other factors that could cause our or our industry's actual results, level of
activity, performance or achievement to differ materially from those discussed
in or implied by any forward-looking statements made by or on behalf of us and
could cause our financial condition, results of operations or cash flows to be
materially adversely affected. Accordingly, investors and all others are
cautioned not to place undue reliance on such forward-looking statements.

Potential risks, uncertainties, and other factors which could cause the
Company's financial performance or results of operations to differ materially
from current expectations or such forward-looking statements include, but are
not limited to:

      o     International economic and political risks, over which we have
            little or no control;
      o     Challenges posed by competing in a changing international
            environment;
      o     Political uncertainty in Hong Kong and China making it difficult to
            develop any long range planning;
      o     Relations between the United States and China remaining stable;
      o     The Chinese government could change its policies toward private
            enterprises or expropriate private enterprises;

                                                                              18
<PAGE>

      o     The lack of adequate remedies and impartiality under China's legal
            system may adversely impact our ability to do business and enforce
            our agreements with third parties;
      o     Fluctuations in exchange rates;
      o     Our dependence on third parties for equipment and services;
      o     Competition from our own cargo agents;
      o     Having seasonal business that causes fluctuations in our results of
            operations and financial condition;
      o     A lack of ongoing contractual relationships with our customers;
      o     Taking on significant credit risks in the operation of our business
            as East Coast U.S. freight forwarders expect us to offer thirty days
            credit from the time of cargo delivery;
      o     Our inventory of shipping space is subject to the significant risk
            that we may not be able to "fill" the space while having contracted
            for that space, and
      o     Our insurance may not be sufficient to cover losses or damages to
            the freight we ship or for consequential damages for a shipment of
            hazardous materials.

Many of these factors are beyond our control, and you should read carefully the
factors described in "Risk Factors" in our filings (including our Forms 10-K and
registration statements) with the Securities and Exchange Commission for a
description of some, but not all, risks, uncertainties and contingencies. These
forward-looking statements speak only as of the date of this document. We do not
undertake any obligation to update or revise any of these forward-looking
statements to reflect events or circumstances occurring after the date of this
document or to reflect the occurrence of unanticipated events. Any
forward-looking statements are not guarantees of future performance.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Management's discussion and analysis of financial condition and results of
operations are based upon our consolidated financial statements. These
statements have been prepared in accordance with accounting principles generally
accepted in the United States of America. These principles require management to
make certain estimates, judgments and assumptions that affect the reported
amounts of assets, liabilities, revenues and expenses, and related disclosure of
contingent assets and liabilities. On an on-going basis, we evaluate our
estimates, based on historical experience, and various other assumptions that
are believed to be reasonable under the circumstances, the results of which form
the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results may
differ from these estimates under different assumptions or conditions.

The following critical accounting policies rely upon assumptions, judgments and
estimates and were used in the preparation of our consolidated financial
statements:

RECOGNITION OF COST OF FORWARDING

The billing of cost of forwarding is usually delayed. As a result, we must
estimate the cost of purchased transportation and services, and accrue an amount
on a load-by-load basis in a manner that is consistent with revenue recognition.
Such estimate is based on past trends, and on the judgment of management.
Historically, upon completion of the payment cycle (receipt and payment of
transportation bills), the actual aggregate transportation costs are not
materially different than the accrual. However, in any case in which the actual
cost varies significantly from the accrual, a revision to the accrual would be
required.

                                                                              19
<PAGE>

ACCOUNTING FOR INCOME TAXES

In preparing our condensed consolidated financial statements, we are required to
estimate our income taxes in each of the jurisdictions where we operate. This
process involves estimating actual current tax exposure, together with assessing
temporary differences resulting from differing treatment of items for tax and
accounting purposes. These differences result in deferred tax assets and
liabilities, which are included in our condensed consolidated balance sheet. We
must then assess the likelihood that our deferred tax assets will be recovered
from future taxable income, and to the extent that we believe that recovery is
not likely, we must establish a valuation allowance. To the extent we establish
a valuation allowance, we must include an expense within the tax provision of
the condensed consolidated statements of operations in each period in which the
allowance is increased.

Significant judgment is required in determining the provision for income taxes,
deferred tax assets and liabilities, and any valuation allowance, against our
deferred tax assets. In the event that actual results differ from these
estimates or the estimates are adjusted in future periods, then we may need to
establish an additional valuation allowance, which could materially impact our
financial position and results of operations. Based on our current financial
projections, we currently believe that we will realize 100% of our deferred tax
assets.

VALUING LONG-LIVED ASSETS, INTANGIBLES AND GOODWILL

We assess the impairment of identifiable long-lived assets purchased intangible
assets and goodwill whenever events or changes in circumstances indicate that
the carrying amount may be impaired. Factors that we consider when evaluating
for possible impairment include the following:

      o     Significant under-performance relative to expected historical or
            projected future operating results;
      o     Significant changes in the manner of our use of the acquired assets
            or the strategy for our overall business; and
      o     Significant negative economic trends.

When determining whether the carrying value of long-lived assets and goodwill is
impaired based upon the existence of one or more of the above factors, we
determine the existence of impairment by comparison of the carrying amount of
the asset to expected future cash flows to be generated by the asset. If such
assets are considered impaired, the impairment is measured as the amount by
which the carrying value of the assets exceeds their fair values. As of March
31, 2006, goodwill totaled $3,755,393, other intangible assets amounted to
$881,757 and our long-lived assets, consisting primarily of net property, plant
and equipment, totaled $881,869.

                                                                              20
<PAGE>

As required by SFAS No. 142, "Goodwill and other Intangible Assets," goodwill
and other intangible assets with indefinite lives are no longer amortized, but
rather are to be tested at least annually for impairment. This pronouncement
also requires that intangible assets with definite lives be amortized over their
respective lives to their estimated residual value and reviewed for impairment
in accordance with SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets". During the period from 2002 to the first quarter of 2006, we
acquired the below companies and recorded goodwill and intangibles associated
with these acquisitions. It is summarized as follows:

<TABLE>
<CAPTION>
                                                                                  Intangible
                                                                                   (Company
                                                                                 logo, domain
                                                 Goodwill        Intangible         name,          Intangible
                                               (recorded at        assets        networks and        assets
                         Name of Company       the time of        (customer        customer        (business
 Date of Acquisition         Acquired          acquisition)    relationships)   relationships)      license)
-----------------------------------------------------------------------------------------------------------------
<S>                    <C>                     <C>             <C>              <C>             <C>
April 30, 2002         Airgate                  $2.68 million    $2.86 million                                $-
                       International Corp.
April 1, 2004          Shanghai Air Cargo             $36,493               $-                                $-
                       Ground Handling
                       Services Ltd.
April 30, 2004         Paradigm Int'l Inc.            $20,248          $26,708                                $-
January 1, 2005        Careship                      $245,485               $-                          $662,991
                       International
                       Transportation Ltd.
July 1, 2005           WCL Global                    $408,160         $199,214                                $-
                       Logistics Ltd. (51%)
October 24, 2005       AIO Global                     $92,138               $-                                $-
                       Logistics, Ltd.
November 24, 2005      Seabridge                           $-               $-         $15,012                $-
                       International Pte.
                       Ltd.
February 28, 2006      WCL Global                    $514,586          $50,646                                $-
                       Logistics Ltd. (49%)
</TABLE>

The acquisitions of Airgate International Corporation ("Airgate"), Paradigm
International Inc. ("Paradigm"), WCL Global Logistics Ltd. ("WCL"), AIO Global
Logistics Limited ("AIO") and Seabridge International Pte. Ltd. ("Seabridge)
were recorded using the purchase method of accounting in accordance with SFAS
No. 141. We allocated the purchase price to the assets, liabilities, intangibles
and goodwill acquired, based on the fair value at the date of acquisition. The
results of operations of each company since the date of acquisition, and its
financial condition as of each balance sheet date are reflected in our condensed
consolidated financial statements. All significant inter-company balances and
transactions have been eliminated in consolidation.

The acquisition of Shanghai Air Cargo Ground Handling Services Ltd. and Careship
International Transportation Ltd. were recorded under the equity method of
accounting in accordance with APB Opinion No. 18 "The Equity Method of
Accounting for Investment in Common Stock.". As such the financial statements
will show one line item on the balance sheet, "Equity investment in Affiliates"
and one line item on the statement of operations, "Equity Income in Affiliates".
Again, the purchase prices were allocated to the assets, liabilities,
intangibles and goodwill acquired, based on the fair value at the date of
acquisition.

                                                                              21
<PAGE>

The intangible customer relationship assets of Airgate and Paradigm are
amortized over a period of five years while WCL is eight years. The business
license under Careship International Transportation Ltd. are amortized over a
period of 10.25 years. Goodwill acquired in business combinations is not
amortized, but rather is tested annually for impairment in accordance with SFAS
No. 142. An equity investment in an investee including any goodwill therein is
tested for impairment under APB Opinion No. 18.

ACCOUNTS AND NOTES RECEIVABLES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS

Accounts receivable are stated at the amount billed to customers. The Company
provides an allowance for doubtful accounts, which is based upon a review of
outstanding receivables, historical collection information and existing economic
conditions. Accounts receivable are ordinarily due 30 days after the issuance of
the invoice. Accounts past due more than 120 days are considered delinquent.
Delinquent receivables are written off based on individual credit evaluation and
specific circumstances of the customer.

Notes receivable are stated at their outstanding principal amount, net of an
allowance for uncollectible notes. The Company provides an allowance for
uncollectible notes, which is based upon a review of outstanding receivables,
historical collection information and existing economic conditions. Outstanding
notes accrue interest based on the terms of the respective note agreements. A
note receivable is considered delinquent when the debtor has missed three or
more payments. At that time, the note is placed on non-accrual status and
interest accrual ceases and does not resume until the note is no longer
classified as delinquent. Delinquent notes are written off based on individual
credit evaluation and specific circumstances of the borrower.

OVERVIEW

The Company does not carry on any business activities by itself. Instead,
through its subsidiaries and associated companies, it provides supply chain
management solutions, contract logistics services and international freight
forwarding services. The Company's current business was formed from a base of
two freight forwarders, AGI Logistics (HK) Ltd. ("AGI") and Airgate
International Corp. ("Airgate") which were acquired in 2000 and 2002,
respectively and the business is managed from our principal support group
offices in New York and Hong Kong.

The Company's wholly owned subsidiary, AGI Logistics (HK) Ltd. ("AGI"), operates
an integrated logistics and freight forwarding business which is based in Hong
Kong. The principal services provided by AGI are air freight forwarding, ocean
freight forwarding, and warehousing which primarily handles the delivery of
goods from China and Hong Kong to overseas countries, mainly the Far East region
and the United States. In the Far East region, Mainland China is the target
market for AGI to expand.

The business of AGI was first established in August 1998 and now consists of its
own operations, as well as those of its subsidiaries and associated companies.
At March 31, 2006, AGI wholly-owned subsidiaries included Shenzhen Careship
International Transportation Ltd. ("HK Careship"), AGI China Limited and WCL
Global Logistics Limited ("WCL") which were acquired by AGI in 2000, 2002 and
2006, respectively, while the majority owned subsidiary included AIO Global
Logistics Limited (51%). AGI also has equity investments in affiliates: Shanghai
Air Cargo Ground Handling Services Ltd ("Shanghai Air Cargo"), Vantage Point
Services Limited ("Vantage Point") and Careship International Transportation
Ltd. ("Careship International") of 35%, 40% and 46.92% of their total equity,
respectively.

                                                                              22
<PAGE>

In April 2004, Shanghai Air Cargo, that is 35% owned by the Company, commenced
its operation. Shanghai Air Cargo is located in Pudong International Airport,
Shanghai, PRC, and is responsible for the ground handling of air cargo in the
airport.

In October 2004, the Company acquired 40% of the outstanding stock of Vantage
Point. Vantage Point is also a non-asset based logistics services company based
in Hong Kong, which handles both air and ocean shipments all over the world.

On January 1, 2005, the Company acquired 46.92% of the outstanding stock of
Careship International. Careship International is located in Shenzhen PRC and is
approved to operate international freight forwarding business by the Ministry of
Foreign Trade and Economic Cooperation of the People's Republic of China.

The following discussion, concerning the results of operations, liquidity and
capital resources of Pacific CMA, is based solely upon the business operations
that are carried on by the Company's subsidiaries from January 1 to March 31,
2006 and the same period of 2005.

On July 1, 2005, the Company acquired 51% of the outstanding stock of WCL. WCL
is a non-asset based logistics services company based in Hong Kong. It also has
a branch office in Guangzhou, PRC, which handles both air and ocean shipments
all over the world. On February 28, 2006, AGI acquired the remaining 49% of the
outstanding stock of WCL and as a result, WCL became a wholly-owned subsidiary
of AGI.

On October 24, 2005, the Company formed a new entity in Hong Kong , AIO Global
Logistics Ltd ("AIO"), to acquire certain assets of All In One Global Logistics
Ltd ("All In One"). The Company holds 51% of the outstanding shares of AIO. The
shareholders of All In One hold the other 49%. The principle activities of AIO
are providing warehouse management and freight forwarding services in Hong Kong.

Airgate a privately held New York based freight forwarder that was established
in 1995, was acquired on April 30, 2002. Airgate is a non-asset based logistics
services company which primarily handles the air and ocean import shipments from
the Far East and Southwest Asia to the U.S. Pacific CMA International, LLC, a
Colorado limited liability company that is wholly owned by the Company, acquired
81% of the issued and outstanding common stock of Airgate. In September 2002,
Airgate commenced additional operations in Chicago. On July 29, 2005, Pacific
CMA International, LLC increased its ownership from 81% to 99.11% in a pro rata
rights offering of Airgate's common stock. In the offering, Airgate offered
2,025 newly issued shares of its common stock, at a price of $100 per share.
Pacific CMA International, LLC purchased its pro-rata number of shares and the
minority interest did not purchase any shares. As a result, Pacific CMA
International, LLC ownership percentage increased.

                                                                              23
<PAGE>

On April 30, 2004, the Company completed the acquisition of Paradigm
International Inc. ("Paradigm Int'l"). Paradigm is a non-asset based logistics
services company based in Miami, Florida. It primarily handles air and ocean
shipments in Latin America. In July 2004, Paradigm Int'l commenced additional
operations in Los Angeles, California and it does business under the name
Paradigm Global Logistics ("Paradigm Global")

On July 1, 2004, the Company acquired 60% of the outstanding stock of AGI
Freight Singapore Pte Ltd. ("AGI Singapore"). AGI Singapore is a non-asset based
logistics services company based in Singapore, that handles both air and ocean
shipments all over the world.

On November 24, 2005, the Company's subsidiary, AGI Singapore, purchased all
rights to the business name, logo, domain name, websites, activities, networks,
customers and contacts of Seabridge Freight International Pte. Limited from an
individual third party to formed a new company called Seabridge International
Pte Limited. The purchase agreement required the sellers and their associates
not to engage in any form of business objectives or activities similar to and
related to the business of Seabridge Freight International Pte. Limited for a
period of 3 years from the date of the purchase. The agreement also requests the
termination of the registration of Seabridge Freight International Pte. Limited
from the Registry of the Accounting & Corporate Regulatory Authority in
Singapore.

The following is the significant new development occurring during the three
months ended March 31, 2006:

      o     Acquisition of the remaining 49% of the outstanding common stock of
            WCL Global Logistics Ltd to make it a wholly owned subsidiary for
            the Company on February 28, 2006

RESULTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2006 COMPARED WITH THREE MONTHS ENDED
MARCH 31, 2005

OVERALL RESULTS

Freight forwarders are compensated on a transactional basis for the movement of
goods and provision of related services to their customers. Therefore, our
revenue is derived from our freight forwarding services based upon the rates
that we charge our customers for the movement of their freight from origin to
destination. The carrier's contract is with us, not with our customers. We are
responsible for the payment of the carrier's charges and we are legally
responsible for the shipment of the goods. We are responsible for any claims for
damage to the goods while in transit. In most cases, we receive reimbursement
from the carriers for any claims. Since many shippers do not carry insurance
sufficient to cover all losses, we also carry insurance to cover any
unreimbursed claims for goods lost or destroyed in the event of a total loss.
Gross revenue represents the total dollar value of services we sell to our
customers. Our costs of transportation, products and handling include the direct
cost of transportation, including tracking, rail, ocean, air and other costs. We
commit to pay for space with shippers prior to receiving committed orders from
our customers. We act principally as a service provider to add value and
expertise in the procurement and execution of these services for our customers.
Therefore, our gross profits (gross revenues less the direct costs of
transportation, products, and handling) are indicative of our ability to source,
add value and resell services and products that are provided by third parties.

                                                                              24
<PAGE>

Total revenue for the three months ended March 31, 2006 increased approximately
19% compared with the three months ended March 31, 2005, from $25,604,545 in
2005 to $30,429,925 in 2006. The increase in revenue was primarily the result of
the organic growth of AGI, Shenzhen Careship and Airgate, in addition to the
inclusion of the results of WCL after the acquisition in July 2005.

Revenue derived from the operations of AGI increased approximately 32% during
the three months ended March 31, 2006 as compared with 2005. The significant
organic growth of AGI was the result of the following factors:

      o     An increase in the routed freight traffic from the existing agency
            partners;
      o     Improvements in the agency network which enabled AGI to secure new
            freight business;
      o     The inclusion of the results of WCL after the acquisition on July 1,
            2005.

The revenue of Airgate represented approximately 54% of our total revenue for
the three months ended March 31, 2006. Airgate focuses its operations on the
import of goods from the Far East and deconsolidation of cargo. Revenue derived
from the operations of Airgate increased approximately 4.2% for the three months
ended March 31, 2006 when compared with the same period of 2005. The increase is
the result of the effort of Airgate's staff.

Total revenue derived from Paradigm and AGI Singapore for the three months ended
March 31, 2006 amounted to approximately $3.95 million, which represents
approximately 13% of total revenue of the Group.

When compared with 2005, the cost of forwarding for the three months ended March
31, 2006 increased approximately 20%, from $21,508,127 in 2005 to $25,750,270 in
2006. The increase in costs was primarily the result of the organic growth of
the Company and the acquisition of WCL in July 2005.

Gross profit margin for the three months ended March 31, 2006 and 2005 were
quite constant, approximately 16.00% in 2005 and 15.38% in 2006 and gross profit
(revenue minus cost of forwarding) for the three months ended March 31, 2005
increased 14.24%, from $4,096,418 in 2005, to $4,679,655 in 2006.

Net income (loss) for the three months ended March 31, 2006 decreased
approximately 903%, from net income of $62,428 in 2005, to net loss of $501,762
in 2006. The decrease in net income was mainly due to the significant increases
in 1) amortization of the Series A Preferred Stock discount, its deferred
financing costs and its beneficial conversion and 2) amortization of the Minimum
Borrowing Note and Revolving Note discount and their deferred financing costs.
Details of expense fluctuations will be discussed in the sections "Operating
expenses" and "Non-operating expenses" respectively.

                                                                              25
<PAGE>

BUSINESS SEGMENT OPERATING RESULTS

The results of operations for each segment are as follows:

AIRFREIGHT OPERATIONS: Revenue from airfreight operations increased
approximately 27%, from $15,718,901 in the first quarter of 2005 to $19,950,405
in the same period of 2006. Airfreight revenue for foreign operations (that
includes AGI Group and AGI Singapore) was $10,128,203, while airfreight revenue
for domestic operations (that includes Airgate and Paradigm) was $12,036,096,
and offsetting inter-company transactions totaled $2,213,894. The volume of
airfreight improved in 2006 compared with 2005. The increase was primarily due
to (i) an increase in routing orders from Asia to the United States as a result
of new customers and agents in India, Japan and Turkey who joined the Group
during 2005, (ii) the maturing of businesses for HK Careship, Paradigm Global
Logistics and AGI Singapore; and (iii) WCL and AIO joining the Company in July
2005 and November 2005 respectively.

Costs for the airfreight forwarding operations increased approximately 29%, from
$12,864,037 in the first quarter of 2005 to $16,622,054 in the same period of
2006. Airfreight cost attributable to foreign operations was $8,645,698, while
airfreight cost attributable to domestic operations was $10,190,250, and
offsetting inter-company costs were $2,213,894. The airfreight cost increase in
2006 was due to the collection of airline surcharges for security, advance cargo
manifest and fuel. Also, due to the increase in fuel surcharge that cannot be
totally shift to the customers, gross profit margin decreased from approximately
18.16% in 2005 to approximately 16.68 % in 2006. Despite the decreased in gross
profit margin, overall gross profits increased approximately 17% to $3,328,351.

Total segment overhead attributable to the airfreight operation increased by
approximately 23%, from $1,144,641 in the first quarter of 2005 to $1,412,524 in
the same period of 2006, as a result of greater resources being allocated to
airfreight operations. Details regarding the increase in overhead expenses are
discussed below in "- Non Operating Income and Expenses".

Overall, net segment income for the airfreight operation increased by
approximately 12% from $1,710,223 in the first quarter of 2005 to $1,915,827 in
the same period of 2006. The increase in net income was mainly the result of our
organic growth as well as the inclusion of WCL and AIO operating results which
were acquired in July and November 2005 respectively.

SEA FREIGHT OPERATION: Revenue from sea freight operations increased
approximately 6% to $10,479,520 in the first quarter of 2006 from $9,885,644 in
the same period of 2005. Sea freight revenue for foreign operations was
$3,242,331, while sea freight revenue for domestic operations was $7,599,064,
and offsetting inter-company transactions were $361,875. The increase in revenue
was due to the contribution from the new branch offices of Shenzhen Careship in
China and the increase in quantity of freight consolidation by Airgate Chicago.

The increase in revenue for 2006 from 2005 was due to revenues derived from new
customers in European countries. In addition, our agents in India, Japan and
Turkey introduced more customers into our network, which led to greater revenue
from the Shanghai market in the first quarter of 2006. There was also an
increment in the quantity of freight consolidation in Chicago.

                                                                              26
<PAGE>

Costs for the sea freight forwarding operation increased approximately 6%, from
$8,644,090 in the first quarter of 2005 to $9,128,216 in the same period of
2006. Sea freight costs attributable to foreign operations were $2,585,931,
while costs attributable to domestic operations were $6,904,160, and
inter-company costs were $361,875. The gross profit margin was quite constant,
approximately 12.56% in 2005 to approximately 12.89% in 2006. As a result of
increased revenues, overall gross profits increased approximately 9%, to
$1,351,304.

Total segment overhead attributable to the sea freight operation increased
approximately 16%, from $592,866 in the first quarter of 2005 to $687,408 in the
same period of 2006. Overall net income for the sea freight operation increased
approximately 2%, from $648,688 in the first quarter of 2005 to $663,896 in the
same period of 2006. The increase in net income was mainly the result of the
organic growth of AGI and Airgate.

OPERATING EXPENSES

GENERAL AND ADMINISTRATIVE EXPENSES

General and administrative expenses increased approximately 28%, to $4,562,123
in the first quarter of 2006 from $3,561,895 in 2005. There was a significant
incremental increase in expenses for the following items in this quarter:
consultancy fee, overseas traveling, legal and professional fees, as well as
salaries and allowance. As the Company has been continuously growing and in
order to cope with the growth in 2006, our staff planning needs called for the
hiring of additional staff throughout our offices in the fourth quarter of 2005.

Consultancy fee: Expenses related to consultancy increased approximately 153%,
from $49,540 in 2005 to $125,084 in 2006. The increase in consultancy fee was
due to the cost attribute to the freight consultant, advisor fee and network fee
for worldwide market.

Overseas traveling: Expenses related to overseas traveling increased
approximately 118%, from $56,154 in 2005 to $122,568 in 2006. The increase in
travel expenses was due to costs attributable to an increased number of trips to
Mainland China, Japan, South East Asia and European countries to promote our
freight business.

Salaries and allowance: Salaries and allowance increased approximately 27% from
$1,656,593 in 2005 to $2,105,329 in 2006. This increase was the result of the
addition of approximately 45 staff persons during past three months ending March
31, 2006 needed to keep pace with our growth.

STOCK-BASED COMPENSATION COST

Stock-based compensation cost decreased approximately 65% from $101,102 in the
first quarter of 2005 to $34,912 in the first quarter of 2006. The decrease in
compensation cost was primarily due to the part of the stock based compensation
cost in the first quarter of 2005 was fully amortized in the year 2005. Details
of the stock grant and cancellation are as follows:

                                                                              27
<PAGE>

On or about November 7, 2003, we entered into four service agreements with three
employees and an independent sales representative. Under the terms of the
agreements, as amended in March 2004, we granted these employees and the sales
representative an aggregate of 1,950,000 shares of our common stock.
Compensation cost is measured at the grant date based on the estimated fair
value of the securities. It is recognized as an expense over the service period
required under the service agreements with those parties. The unearned portion
of the compensation cost related to employees is recorded in equity as unearned
compensation cost, while the unearned portion of compensation cost related to
the independent sales representative is recorded as a prepaid asset. Effective
January 1, 2006 under the provisions of FASB Statement No. 123 (revised 2004),
paragraph 74, the unearned compensation was reclassified against common stock
and will continue to be amortized. The shares are restricted as they have not
been registered with the Securities and Exchange Commission (the "SEC" or the
"Commission"). The agreements with the employees, as amended, required two of
them to continue to provide services to us from January 1, 2004 through December
31, 2013 and one of them to provide services to us from January 1, 2004 through
December 31, 2008. The agreement with the sales representative required him to
provide services to us from January 1, 2004 through December 31, 2005. However,
in December 2004, one of the employees resigned and, by mutual agreement, she
surrendered her 850,000 shares. The independent sales representative agreed to
surrender his 200,000 shares in exchange for $50,000 in cash, payable during his
two year service agreement expiring at December 2005. The surrenders occurred in
2004 and the 850,000 shares and 200,000 shares were physically cancelled in
early 2005 and early 2006 respectively. The service agreement related
compensation costs were reversed during the fourth quarter of 2004.

In March 2004, we granted an employee 100,000 shares of common stock. The shares
were registered with the SEC by filing a Form S-8 Registration Statement on
March 29, 2004. On September 11, 2004, this employee resigned from the position
of Director but agreed to continue to act as an independent consultant for
British market development. The employee continued to provide services to the
Company through December 31, 2005. Compensation cost is measured at the grant
date based on the estimated fair value on the date of grant. The compensation
cost is recognized as expense over the service period required under the
agreement. The unearned portion of the compensation cost is recorded in equity
as unearned compensation. The compensation cost has been fully amortized in 2005

DEPRECIATION AND AMORTIZATION

Depreciation and amortization increased approximately 11% from $222,526 in 2005
to $246,565 in 2006. The increase was mainly attributable to purchases of
additional computer hardware and software for the enhancement of new logistics
system at AGI Logistics Hong Kong Ltd.

Amortization arises from intangible customer relationship assets recorded in
conjunction with the acquisitions of Airgate on April 30, 2002, Paradigm on
April 30, 2004 and WCL on July 1, 2005 (51%) and February 28, 2006 (49%). These
intangible assets are amortized on a straight-line basis over a period of five
to eight years. During the three months ended March 31, 2006 and 2005, the
amortization expense attributable to this asset was $151,104 and $144,335,
respectively, an increase of $6,769.

                                                                              28
<PAGE>

NON OPERATING INCOME AND EXPENSES

INTEREST AND OTHER INCOME

Interest and other income increased from $35,141 in the first quarter of 2005 to
$102,750 in the same period of 2006. This increase is mainly due to the rising
interest rates and the increase in the amount of bank pledge deposits securing
additional banking facilities.

INTEREST EXPENSE

Interest expense increased to $186,626 in the first quarter of 2006 from
$114,352 in the same period of 2005. The increase in interest expense is
primarily due to an increase in short-term working capital financing and the
increases in interest rates during the first quarter of 2006 as compared to the
first quarter of 2005.

PREFERRED STOCK DIVIDEND AND AMORTIZATION OF DEFERRED FINANCING COST

During April and May 2004, the Company sold to two institutional investors
$5,000,000 stated amount of its Series A Preferred Stock and issued warrants to
purchase 1,562,500 shares of common stock at an exercise price of $1.76 and
781,250 shares at $2.00 per share. Such Series A Preferred Stock has mandatory
redemption requirements and was recorded in accordance with SFAS No. 150,
"Accounting for Certain Financial Instruments With Characteristics of Both
Liabilities and Equity". The dividends paid and accrued are charged to expense
in the statements of operations. In accordance with EITF 98-5, the intrinsic
value of the beneficial conversion option of $166,666 was recorded as additional
expense and credited as additional equity in warrants outstanding in 2004. The
deferred financing cost related to the placement of the Series A Preferred Stock
is amortized over its term to maturity, which is four years. A total of $101,555
and $59,101 was expensed during the first quarter of 2006 and 2005 respectively.
Dividends amounting to $63,500 and $58,732 were paid in shares of common stock
in the first quarter of 2006 and 2005 respectively.

AMORTIZATION OF PREFERRED STOCK DISCOUNT

In accordance with APB Opinion 14 "Accounting for Convertible Debt" and "Debts
Issued with Stock Purchase Warrants", the Series A Preferred Stock and the
detachable stock warrants were recorded at their relative fair values with the
value of the warrants recorded as additional equity in warrants outstanding. The
fair value of the warrants was determined based on an independent valuation.
Effectively, the Series A Preferred Stock was recorded at a discount of
$939,713. This discount is amortized ratably over the term of the Series A
Preferred Stock. As a result, $99,427 was expensed during the first quarter of
2006.

Moreover, on August 4, 2005, the Company completed a financing transaction and
issued and sold to Laurus Master Fund, Ltd. ("Laurus"), an institutional
investor, a Secured Convertible Minimum Borrowing Note for $4,000,000 and a
Secured Revolving Note, which Notes are in the aggregate principal amount of
$7,500,000. The maximum amount available under the Notes is limited to the
lesser of $7,500,000 or a collateral calculation based on "Eligible Accounts
Receivable" as defined in the agreement. The Notes accrue interest at the
greater of 6% or the prime rate plus 1%. The Company is subject to interest rate
reductions if it achieves certain financial goals. The Notes mature on July 29,
2008 and contain a conversion feature whereby the Notes can be converted to
common stock. The conversion price of the first $3,750,000 is $0.88 per share
and the balance is convertible at $1.05. Lastly, the Company also issued
warrants to the holder of the Notes that allows the holder to purchase 1,500,000
shares of common stock at $1.00 per share. The warrants expire on July 29, 2012.

                                                                              29
<PAGE>

Based upon the above financing transaction executed on August 4, 2005 and
pursuant to the Certificate of Designation of Preferences Rights and Limitations
of Series A Convertible Preferred Stock of the Company executed April 12, 2004,
and the Common Stock Purchase Warrants issued to the purchasers of the Company's
Series A Convertible Preferred Stock, the Set Price of the Series A Convertible
Preferred Stock and the exercise price of the Purchases Warrants, has been
adjusted to $0.88 per share. In accordance with EITF 00-27 and EITF 05-8, the
intrinsic value of the additional beneficial conversion option of $2,659,091 was
recorded as unamortized debt discount and $1,595,455 and $1,063,636 were
credited as additional equity in warrants outstanding and the related deferred
tax liability respectively on the date of the conversion price resetting. The
additional unamortized discount is amortized to expense using the effective
interest method over the remaining life of Series A Preferred Stock and the
deferred tax liability is amortized to tax expense as the interest expense is
recognized. As a result, a total of $155,608 was expensed as amortization from
the additional beneficial conversion for Series A Preferred Stock during the
first quarter ended March 31, 2006.

On January 25 and March 30, 2006, one of the institutional investors converted
300 shares each of the Series A Preferred Stock into shares of Common Stock at a
conversion price of $0.88 per share, respectively. As a result, the Company has
written off a pro-rata share of the unamortized debt discount for warrants,
unamortized debt discount for additional beneficial conversion and unamortized
deferred financing costs on the Series A Preferred Stock to expense of $63,897,
$271,764 and $65,278 respectively on the date of conversion.

MINIMUM BORROWING NOTE AND REVOLVING NOTE AMORTIZATION OF DEFERRED FINANCING
COST

The relative fair value of the deferred finance costs attributable to the
detachable stock warrants of $53,261 was debited to the additional equity in
warrants outstanding and credited against the deferred financing cost. The
deferred financing costs related to Minimum Borrowing Note and Revolving Note
are amortized over their term to maturity, which is three years. A total of
$18,334 was expensed during the first quarter of 2006.

AMORTIZATION OF MINIMUM BORROWING NOTE AND REVOLVING NOTE DISCOUNT

In accordance with APB Opinion 14 "Accounting for Convertible Debt" and "Debts
Issued with Stock Purchase Warrants", the Minimum Borrowing Note, Revolving Note
and the detachable stock warrants were recorded at their relative fair values
with the value of the warrants recorded as additional equity in warrants
outstanding. The fair value of the warrants was determined based on an internal
valuation by the Company using Black Scholes Option Pricing Model with an amount
of $531,011 being record. Effectively, the Minimum Borrowing Note and Revolving
Note were recorded at a discount of $371,675 and $159,336 respectively. This
discount is amortized ratably over the term of the Minimum Borrowing Note and
Revolving Note which is three years. During the first quarter of 2006, $10,434
of this discount was amortized into expense.

                                                                              30
<PAGE>

RISK FACTORS AFFECTING COMPANY OPERATIONS

The Company's ability to provide service to its customers is highly dependent on
good working relationships with a variety of entities such as airlines,
steamship carriers and governmental agencies.

Unlike other U.S. logistics companies, the Company bears a significant amount of
inventory risk. We pay for the guarantees we put up to the carriers, even if we
do not have any customer cargo to fill the space. We are not able to ask our
clients to make these guarantees and, accordingly, we assume all of the risks.

The Company has freight forwarders liability insurance that covers it against
claims from clients. We take responsibility for the cargo, and we are
responsible for its safe delivery. Therefore, we can be held responsible and
incur losses if anything goes wrong.

Changes in governmental deregulation efforts, regulations governing the
Company's products, and/or the international trade and tariff environment could
all affect the Company's business in unpredictable ways.

Management believes the Company's business has not been significantly or
adversely affected by inflation in the past. Historically, the Company has
generally been successful in passing cost increases to its customers by means of
price increases. However, competitive market place conditions could impede the
Company's ability to pass on future cost increases to customers and could erode
the Company's operating margins.

The Company continues to assess and improve financial controls, and has
negotiated successfully with its banks to get credit facilities for future
financial needs.

Additional risks and uncertainties include:

      o     Governmental deregulation efforts, regulations governing the
            Company's products and/or the international trade and tariff
            environment adversely affecting our ability to provide services to
            customers;

      o     Competitive marketplace conditions impeding the ability of the
            Company to pass future cost increases to customers;

      o     Dependence of the Company on international trade resulting from
            favorable worldwide economic conditions;

      o     Dependence of the Company on retention and addition of significant
            customers;

      o     The ability to recruit and retain skilled employees in a tight labor
            market;

      o     The ability of the Company to develop and implement information
            systems to keep pace with the increasing complexity and growth of
            the Company's business;

                                                                              31
<PAGE>

      o     The trend of the increasing price of oil has led airlines to charge
            additional fuel surcharges and pass on their added cost on to
            shippers and consignees, increasing the Company's shipping costs,
            that, in turn, results in a reduction in our customers' shipping
            incentive and increasing our rate of order cancellation;

      o     The World Health Organization received reports of the deadly H5N1
            Avian influenza virus in various countries with some cases being
            reported of human infection with the H5N1 Avian influenza virus. As
            the deadly H5N1 virus can be carried by migratory birds and could
            spread globally, the Company's operations could be adversely
            effected by Avian influenza if a human outbreak occurs.


LIQUIDITY AND CAPITAL RESOURCES

We generated (used) approximately $862,000 and $(369,000) of cash from operating
activities for the three months ended March 31, 2006 and 2005, respectively.
This decrease in the use of cash was mainly attributable to decrease in other
receivables and the increase in account payable.

Net cash used in investing activities was $1,124,673 and $79,102 for the three
months ended March 31, 2006 and 2005, respectively. We used $176,734 to acquire
plant and equipment to improve our office facilities, and used $597,945 for the
acquisition of subsidiaries. We also paid $350,000 as a deposit for a business
acquisition.

Net cash (used) provided by financing activities was $(378,623) and $650,124 for
the three months ended March 31, 2006 and 2005, respectively. We made principal
payment under capital lease obligations, other loan and revolving note of
$15,116, $92,663 and $116,201, respectively. In order to extend our banking
facilities, an additional $303,746 was pledged to the banks as restricted cash
deposits. Note payable to the banks increased by $156,899 during the three
months ended March 31, 2006, and we used $7,796 for the repurchase of our common
stock.

Working capital was $8,712,791 (inclusive of restricted cash of approximately
$6.1 million) and $6,559,864 as of March 31, 2006 and 2005 respectively. We
believe that we will be able to rely on cash flow from operations for short-term
liquidity, and also believe that we have adequate liquidity to satisfy our
material commitments for the twelve months following March 31, 2006. We also
believe that we can obtain additional liquidity through further negotiation of
short-term loans from banks to satisfy our short-term funding needs, if any.

We intend to continue our expansion plans through a mixture of organic growth
and acquisitions. Future acquisitions will focus on companies that serve as
freight forwarders in key markets or offer services (such as customs brokerage)
that complement our existing services. We intend to achieve organic growth
through the establishment of new branch offices in Latin America, joint ventures
in the PRC and through a major marketing campaign through the Indian
subcontinent, including India, Sri Lanka and Bangladesh. In order to achieve
this goal, we will be required to raise a certain amount of capital. To a
certain extent, these activities will have a significant impact on both
liquidity and capital resources.

                                                                              32
<PAGE>

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

We have entered into various contractual obligations, which may be summarized as
follows:

<TABLE>
<CAPTION>
                                                                 Payments Due by Period
                                               -----------------------------------------------------------
   Contractual Obligations         Total        Less than 1      1-3 years    4 - 5 years    Thereafter
                                                    year

                                     $               $               $             $             $
                                     114,103           65,935      48,168
<S>                                <C>              <C>          <C>            <C>          <C>
Capital lease Obligations                                                          -             -
Operating Leases                   1,266,692          620,682     462,073          183,937       -
Cargo Space Commitments            3,134,155        3,134,155           -          -             -

Series A Preferred Stock and       4,345,991          234,208   4,102,783          -             -
Cumulative Dividends
</TABLE>

We have capital lease obligations of $114,103 as of March 31, 2006, of which
$65,935 is repayable within one year, and $48,168 is repayable after one year.

We also entered into various lease commitments for office premises and
warehouses in the United States, Hong Kong, Mainland China and Singapore. The
total outstanding lease commitments under non-cancelable operating leases are
$1,266,692 as of March 31, 2006. As of March 31, 2006, the current portion of
these commitments of $620,682 is payable within one year.

We have entered into written agreements with various sea and airfreight carriers
committing to take up a guaranteed minimum amount of cargo space each year. As
of March 31, 2006, the amount outstanding for such commitments to be entered
into in 2006 was approximately $3.1 million.

As of March 31, 2006, our commercial commitments may be summarized as follows:

<TABLE>
<CAPTION>
Other Commercial            Total Amounts     Amount of Commitment Expiration Per Period
Commitments                 Committed
--------------------------------------------------------------------------------------------------
                                                       Less than 1 year                 1-3 years
<S>                                <C>                       <C>
Overdraft                          $2,319,658                $2,319,658                         -

Invoice Trust Receipt               2,710,207                 2,710,207                         -

Guarantees by bank                    730,806                   730,806                         -

Minimum Borrowing Notes,            3,515,346                                           3,515,346
net of discounts of
$484,654

Payable - minority                    150,120                   150,120                         -
shareholder
</TABLE>

As of March 31, 2006, to finance our working capital, our available banking
facilities were approximately $9,419,355 obtained from creditworthy commercial
banks in Hong Kong. As of that date, the total amount of bank credit facilities
utilized was $5,029,865. This was made up of (i) $2,319,658 of overdrafts; (ii)
$2,710,207 of invoice trust receipts. Moreover, we have a borrowing facility
with Laurus Master Fund Ltd, subject to certain requirements. The total
available amount of the credit facility is $7.5 million. As of March 31, 2006,
the total amount outstanding for the credit facility, net of discount is
$3,515,346, which is the minimum borrowing note.

                                                                              33
<PAGE>

OUTLOOK

As a result of the global economic growth, we believe the following factors may
have a positive impact on our future results of operation and our financial
conditions:

CLOSER ECONOMIC PARTNERSHIP

We have updated our research on the effects of CPEA since it became operational,
and certain of the following information was extracted from the Trade and
Industry Department, The Government of HKSAR Press Release "The CEPA benefits
Hong Kong economy" on January 5, 2006.

The Closer Economic Partnership Arrangement ("CEPA") that was signed on June 29,
2003, originally focused on stimulating and enhancing Hong Kong's economic
recovery. After that, Six Annexes to CEPA Main Text, Supplement to CEPA (CEPA
II) and Supplement II to CEPA (CEPA III) were subsequently signed on September
23, 2003, October 27, 2004 and October 18, 2005 respectively. In theory, CEPA
significantly lowers the barriers for Hong Kong enterprises to tap the Mainland
China market. Now in its third year of operation, CEPA fostered closer economic
co-operation between the Mainland and Hong Kong and contributed to the long-term
economic development in both places.

Under the CEPA, Hong Kong companies are permitted to set up wholly owned
enterprises in Mainland China to provide logistics services and related
consultancy services for ordinary road freight, and to engage in the management
and operation of logistics services through electronic means. It permits freight
forwarding agents to operate in Mainland China on a wholly owned basis a full
two years ahead of China's WTO entrance timetable, and will permit such agents
to enjoy national treatment in respect of the minimum registered capital
requirement.

CEPA III, signed in October 2005, just came into effect on January 1, 2006,
provides tariff-free access for all products of Hong Kong origin (except
prohibited articles) imported into the Mainland upon applications by local
manufacturers and upon CEPA rules of origin being met and agreed upon. On trade
in services, taking the three phases of CEPA together, the Mainland has agreed
to provide preferential treatment to Hong Kong service suppliers in 27 service
areas. Twenty three liberalization measures spread across 10 service areas,
including distribution and transport, became effective on January 1, 2006 under
CEPA III.

In reviewing its operation in the past two years, CEPA has been implemented
smoothly since its inception. More than 10,000 applications for Certificate of
Origin under CEPA (CO(CEPA)), with a total export value exceeding HK$3.5 billion
(around US$449 million) have been issued. The products concerned range from
textiles and clothing and foods to pharmaceutical, plastics and plastics
products. The amount of CO (CEPA) issued and the value of CEPA exports in 2005
both recorded more than a 100% increase compared with 2004 after a wide range of
products including food and beverages were granted zero-tariff preference under
CEPA II.

Through our Hong Kong-based AGI Logistics (HK) Ltd, Shenzhen Careship
Transportation Ltd, WCL Global Logistics Ltd, AIO Global Logistics Ltd as well
as Pacific CMA Ltd (formerly known as AGI China Ltd), we believe we can enjoy
"first mover" advantage, that is, we believe that our Hong Kong-based
subsidiaries can benefit from CEPA because we have experience in doing business
in, and we believe that we are knowledgeable in the PRC regulations and business
practices. We believe that our existing offices in Hong Kong and Mainland China
can also respond quicker than other U.S. freight forwarders to ongoing
developments in China.

                                                                              34
<PAGE>

OUTSOURCING OF NON-CORE ACTIVITIES

Companies are increasingly outsourcing freight forwarding, warehousing and other
supply chain activities so that they may focus on their respective core
competencies. Companies are increasingly turning to freight forwarders, and
logistics and supply chain management providers, to manage their purchase orders
and assure timely delivery of products at a lower cost and at greater efficiency
than if the function was undertaken directly.

GLOBALIZATION OF TRADE

As barriers to international trade are gradually reduced, international trade
will similarly increase. In addition, companies are increasingly sourcing for
supplies and raw materials from the most competitive suppliers throughout the
world. This form of sourcing would generally also lead to increased volumes of
trade.

INCREASED NEED FOR TIME-DEFINITE DELIVERY

The demand for just-in-time and other time definite delivery has increased as a
result of the globalization of manufacturing, greater implementation of
demand-driven supply chains, the shortening of product cycles and the increasing
value of individual shipments.

Companies are decreasing the number of freight forwarders and supply chain
management providers with which they interact so that they might work providers
who are more familiar with their requirements, processes and procedures, and who
can function as long-term partners. As such, freight forwarders that are
globally integrated and are able to provide a full complement of services,
including pick-up and delivery, shipment via air, sea and land, warehousing and
distribution and customs brokerage, are well positioned to gain from this shift.

Item 3   Quantitative And Qualitative Disclosure About Market Risk

The Company is exposed to market risk in the ordinary course of its business.
These risks are primarily related to foreign exchange risk and changes in
short-term interest rates. The potential impact of the Company's exposure to
these risks is presented below:

FOREIGN EXCHANGE RISK

The Company conducts business in many different countries and currencies. The
Company's business often results in revenue billings issued in a country and
currency, which differs from that where the expenses related to the service are
incurred. This brings a market risk to the Company's earnings. Foreign exchange
rate sensitivity analysis can be quantified by estimating the impact on the
Company's earnings as a result of hypothetical change in the value of the U.S.
Dollar, the Company's functional currency, relative to the other currencies in
which the

                                                                              35
<PAGE>

Company transacts business. As one of the major subsidiaries uses the Hong Kong
Dollar (HKD), which has been linked to the U.S. Dollar at a rate of HKD 7.80 to
USD 1.00, as its functional currency, there has been no material change in the
Company's foreign exchange risk exposure. However, if HKD was unlinked to the US
Dollar, an average 10% weakening of the U.S. Dollar, throughout the period ended
March 31, 2006, would have had the effect of raising operating income
approximately $33,000. An average 10% strengthening of the U.S. Dollar, for the
same period would have had the effect of reducing operating income by
approximately $27,000. The Company currently does not utilize any the derivative
financial instruments or hedging transactions to manage foreign currency risk.

INTEREST RATE RISK

The Company does not currently utilize derivative financial instruments to hedge
against changes in interest rates. At March 31, 2006, the Company had cash and
cash equivalents and restricted cash of $7 million and short-term borrowings of
$5 million, all subject to variable short-term interest rates. A hypothetical
change in the interest rate of 10% would have an insignificant impact on the
Company's earnings. In management's view, there has been no material change in
Company's market risk exposure between March 31, 2005 and March 31, 2006.

Item 4   Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief
Financial Officer, conducted an evaluation of the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
of the Exchange Act), as of the end of the period covered by this quarterly
report.

Our management, including our Chief Executive Officer and Chief Financial
Officer, does not expect that our disclosure controls and procedures will
prevent all errors and all fraud. A control system, no matter how well designed
and operated, can provide only reasonable, not absolute, assurance that the
control system's objectives will be met. Further, the design of a control system
must reflect the fact that there are resource constraints, and the benefits of
controls must be considered relative to their costs. Because of the inherent
limitations in all control systems, no evaluation of controls can provide
absolute assurance that all control issues, errors, and instances of fraud, if
any, have been or will be detected. The inherent limitations include, among
other things, the realities that judgments in decision-making can be faulty, and
that breakdowns can occur because of simple error or mistake. Controls and
procedures also can be circumvented by the individual acts of some persons, by
collusion of two or more people, or by management or employee override of the
controls and procedures. The design of any system of controls and procedures is
based in part upon certain assumptions about the likelihood of future events,
and there can be no assurance that any design will succeed in achieving its
stated goals under all potential future conditions. Over time, controls and
procedures may become inadequate because of changes in conditions or
deterioration in the degree of compliance with policies or procedures. Because
of the inherent limitations in a cost-effective control system, misstatements
due to error or fraud may occur and not be detected. If and when management
learns that any control or procedure is not being properly implemented, (a) it
immediately reviews our controls and procedures to determine whether they are
appropriate to accomplish the control objective and, if

                                                                              36
<PAGE>

necessary, modifies and improves our controls and procedures to assure
compliance with our control objectives, (b) it takes immediate action to cause
our controls and procedures to be strictly adhered to, (c) it immediately
informs all relevant managers of the requirement to adhere to such controls, as
well as all relevant personnel throughout our organization, and (d) it
implements in our training program specific emphasis on such controls and
procedures to assure compliance with such controls and procedures. The
development, modification, improvement, implementation and evaluation of our
systems of controls and procedures is a continuous project that requires changes
and modifications to them to remedy deficiencies, to improve training, and to
improve implementation in order to assure the achievement of our overall control
objectives.

BKD, LLP ("BKD"), our independent auditors, advised our management and Audit
Committee that during the course of their audit of our financial statements as
of and at December 31, 2005, that they noted material weaknesses in our internal
controls as follows: insufficient review of allowance for doubtful accounts;
lack of documented second review and approval of journal entries; and our Chief
Financial Officer not being sufficiently active.

Based upon the evaluation of our disclosure controls and procedures, our Chief
Executive Officer and Chief Financial Officer have concluded that, subject to
the limitations noted above, our disclosure controls and procedures as of March
31, 2006 were not effective to ensure that material information relating to us
and our consolidated subsidiaries is made known to them by others within those
entities to allow timely decisions regarding required disclosures.

During the quarter ended March 31, 2006, there had been no significant changes
in our internal controls, or in other factors that could significantly affect
internal controls, subsequent to the date the Chief Executive Officer and the
Chief Financial Officer completed their evaluation.

After discussing their advice with our auditors, we recognized the need for
additional documentation of second reviews and in some cases, enhanced
procedures. Since then, we have been correcting the material weaknesses in
internal control. Corrective measures include regular credit review of
outstanding receivables, increase manpower on debts collections, separation of
duties and improve documentation second review and approval of journal entries.
Moreover, our CFO was compelled to relocate during the early part of the fourth
quarter of 2005, which we believe explains the finding by our independent
accountants that he was not actively involved in the detailed financial aspects
of our business during fiscal year 2005. We further believe that this situation
substantially contributed to the identification of weaknesses in our internal
controls over financial reporting during that period. We have been working
diligently to address these issues and expect them to be resolved by the second
quarter of 2006.

                                                                              37
<PAGE>

                                     PART II

                                OTHER INFORMATION

Item 1.           Legal Proceedings

Reference is made to our Annual Report on Form 10-K for our fiscal year ended
December 31, 2005 (the "Annual Report"), Part I, Item 3: "Legal Proceedings."

Item 1A. Risk Factors

                  During the first quarter of our fiscal year to end December
31, 2006, there were no material changes in "Risk Factors" from those disclosed
in our Annual Report.

Item 2.           Unregistered Sales of Equity Securities and Use of Proceeds

                  None

Item 3.           Defaults Upon Senior Securities.

                  None

Item 4.           Submission of Matters to a Vote of Security Holders

                  None

Item 5.           Other Information

                  None

Item 6.           Exhibits

         (a)      Exhibits (filed herewith)

         31.1     Certification of the Chief Executive  Officer pursuant to
                  Section 302 of the  Sarbanes-Oxley  Act of 2002 (Rule
                  13a-14(a)).

         31.2     Certification of the Chief Financial  Officer pursuant to
                  Section 302 of the  Sarbanes-Oxley  Act of 2002 (Rule
                  13a-14(a)).

         32.1     Certification of the Chief Executive Officer pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002 (Rule 13a-14(b)).

         32.2     Certification of the Chief Financial Officer pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002 (Rule 13a-14(b)).


                                                                              38
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements 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.

<TABLE>
<CAPTION>
                                                     PACIFIC CMA, INC.

<S>                                         <C>
Date:  May 15, 2006                         By:      /s/Alfred Lam
                                                     --------------------------------------------
                                                           Name:    Alfred Lam
                                                           Title:   Chairman of the Board of Directors
                                                                    (Principal Executive Officer)


Date:  May 15, 2006                         By:      /s/Bill Stangland
                                                     --------------------------------------------
                                                          Name:     Bill Stangland
                                                          Title:    Chief Financial Officer
                                                                    (Principal Financial and Accounting
                                                                    Officer)
</TABLE>









                                                                              39