**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**




**FORM
      10-Q**




x QUARTERLY
      REPORT
      UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934




For
      the
      quarterly period ended: March 31, 2008




o TRANSITION
      REPORT
      UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934




For
      the
      transition period from ___________ to  _____________




Commission
      File Number: 000-50283





**RADIANT
      LOGISTICS, INC.** ****


**(Exact
      Name of Registrant as Specified in Its Charter)**





Delaware
            
            04-3625550(State
                or Other Jurisdiction of
              Incorporation
                or Organization)
            
            (IRS
                Employer Identification No.)





1227
      120 th Avenue
      N.E., Bellevue, WA 98005





(Address
      of Principal Executive Offices)


(425)
        943-4599
 
 (Issuer’s
        Telephone Number, including Area Code)





N/A





(Former
      Name, Former Address, and Former Fiscal Year, if Changed Since Last
      Report)





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Exchange Act during the past 12 months
      (or
      for such shorter period that the registrant was required to file such reports),
      and (2) has been subject to such filing requirements for the past 90 days.
      Yes xNo o





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, a non-accelerated filer, or a smaller reporting company.
      See
      definitions of "large accelerated filer”, “accelerated filer” and “smaller
      reporting company” in Rule 12b-2 of the Exchange Act. (Check one):





Large
                accelerated filer o
            
            Accelerated
                filer oNon-accelerated filer o
            
            Smaller
                reporting company x


(Do
      not
      check if a smaller reporting company)





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





There
      were 34,401,696 issued and outstanding shares of the registrant’s common stock,
      par value $.001 per share, as of May 8, 2008.


1




**RADIANT
      LOGISTICS, INC.**


**TABLE
      OF CONTENTS**




PART
                I. FINANCIAL INFORMATIONItem
                1.
            Condensed
                Consolidated Financial Statements - UnauditedCondensed
                Consolidated Balance Sheets at March 31, 2008 and June 30,
                2007
            3Condensed
                Consolidated Statements of Operations for the three months and nine
                months
                ended March 31, 2008 and 2007
            4Condensed
                Consolidated Statement of Stockholders’ Equity for the nine months ended
                March 31, 2008
            5Condensed
                Consolidated Statements of Cash Flows for the nine months ended March
                31,
                2008 and 2007
            6-7Notes
                to Condensed Consolidated Financial Statements
            8Item
                2.
            Management’s
                Discussion and Analysis of Financial Conditions and Results of
                Operations
            19Item
                3.
            Quantitative
                and Qualitative Disclosures about Market Risk
            30Item
                4T.
            Controls
                and Procedures
            30PART
                II OTHER INFORMATIONItem
                1.
            Legal
                Proceedings
            31Item
                2.
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            31Item
                6.
            Exhibits
            31


2




**RADIANT
      LOGISTICS, INC.**


**Condensed
      Consolidated Balance Sheets**




March 31, 2008
            
            June 30, 2007(unaudited)ASSETSCurrent
                assets -Cash
                and cash equivalents
            
            $
            279,626
            
            $
            719,575Accounts
                receivable, net of allowance for doubtful accounts of $641,493 at
                March
                31, 2008 and $259,960 at June 30, 2007
            
            
            13,536,141
            
            
            15,062,910Current
                portion of employee loan receivable and other receivables
            
            
            176,592
            
            
            42,800Prepaid
                expenses and other current assets
            
            
            153,276
            
            
            59,328Deferred
                tax asset
            
            
            805,516
            
            
            234,656Total
                current assets
            
            
            14,951,151
            
            
            16,119,269Property
                and equipment, net
            
            
            810,513
            
            
            844,919Acquired
                intangibles, net
            
            
            1,379,253
            
            
            1,789,773Goodwill
            
            
            7,433,057
            
            
            5,532,223Employee
                loan receivable
            
            
            40,000
            
            
            80,000Investment
                in real estate
            
            
            40,000
            
            
            40,000Deposits
                and other assets
            
            
            173,056
            
            
            618,153Total
                long term assets
            
            
            9,065,366
            
            
            8,060,149Total
                Assets
            
            $
            24,827,030
            
            $
            25,024,337LIABILITIES
                AND STOCKHOLDERS' EQUITYCurrent
                liabilities -Notes
                payable – current portion of long term debt
            
            $
            233,306
            
            $
            800,000Accounts
                payable and accrued transportation costs
            
            
            9,709,769
            
            
            13,270,756Commissions
                payable
            
            
            1,155,562
            
            
            700,020Other
                accrued costs
            
            
            205,845
            
            
            344,305Income
                taxes payable
            
            
            1,084,917
            
            
            224,696Total
                current liabilities
            
            
            12,389,399
            
            
            15,339,777Long
                term debt
            
            
            3,011,269
            
            
            1,974,214Deferred
                tax liability
            
            
            468,945
            
            
            608,523Total
                long term liabilities
            
            
            3,480,214
            
            
            2,582,737Total
                liabilities
            
            
            15,869,613
            
            
            17,922,514Commitments
                & contingencies
            
            
            -
            
            
            -Minority
                interest
            
            
            11,840
            
            
            57,482Stockholders'
                equity:Preferred
                stock, $0.001 par value, 5,000,000 shares authorized; no shares issued
                or
                outstanding
            
            
            -
            
            
            -Common
                Stock, $0.001 par value, 50,000,000 shares authorized; issued and
                outstanding: 34,401,696 at March 31, 2008 and 33,961,639 at June
                30,
                2007
            
            
            15,857
            
            
            15,417Additional
                paid-in capital
            
            
            7,539,252
            
            
            7,137,774Accumulated
                earnings (deficit)
            
            
            1,390,468
            
            
            (108,850
            )Total
                stockholders’ equity
            
            
            8,945,577
            
            
            7,044,341$
            24,827,030
            
            $
            25,024,337




The
      accompanying notes form an integral part of these condensed consolidated
      financial statements.





3


**RADIANT
      LOGISTICS, INC.**


**Condensed
      Consolidated Statements of Operations**


**(unaudited)**




THREE
                MONTHS ENDED
              MARCH
                31,
            
            NINE
                MONTHS ENDED
              MARCH
                31,2008
            
            2007
            
            2008
            
            2007Revenue
            
            $
            25,765,377
            
            $
            19,394,026
            
            $
            74,431,411
            
            $
            52,155,055Cost
                of transportation
            
            
            16,264,393
            
            
            12,278,178
            
            
            48,093,022
            
            
            33,357,039Net
                revenue
            
            
            9,500,984
            
            
            7,115,848
            
            
            26,338,389
            
            
            18,798,016Agent
                commissions
            
            
            6,611,130
            
            
            5,419,646
            
            
            18,617,364
            
            
            14,389,716Personnel
                costs
            
            
            1,199,467
            
            
            659,130
            
            
            3,836,707
            
            
            1,747,252Selling,
                general and administrative expenses
            
            
            1,268,558
            
            
            742,061
            
            
            2,703,589
            
            
            1,760,558Depreciation
                and amortization
            
            
            238,822
            
            
            209,348
            
            
            720,426
            
            
            600,295Total
                operating expenses
            
            
            9,317,977
            
            
            7,030,185
            
            
            25,878,086
            
            
            18,497,821Income
                from operations
            
            
            183,007
            
            
            85,663
            
            
            460,303
            
            
            300,195Other
                income (expense):Interest
                income
            
            
            800
            
            
            2,490
            
            
            3,200
            
            
            6,801Interest
                expense
            
            
            (27,173
            )
            
            (5,397
            )
            
            (101,045
            )
            
            (15,849
            )Other –
                non recurring
            
            
            -
            
            
            -
            
            
            1,918,146
            
            
            -Other
            
            
            (47,811
            )
            
            (21,783
            )
            
            (54,550
            )
            
            (24,466
            )Total
                other income (expense)
            
            
            (74,184
            )
            
            (24,690
            )
            
            1,765,751
            
            
            (33,514
            )Income
                before income tax expense
            
            
            108,823
            
            
            60,973
            
            
            2,226,054
            
            
            266,681Income
                tax expense
            
            
            35,841
            
            
            37,449
            
            
            772,378
            
            
            18,327Income
                before minority interests
            
            
            72,982
            
            
            23,524
            
            
            1,453,676
            
            
            248,354Minority
                interest
            
            
            13,696
            
            
            (18
            )
            
            45,642
            
            
            (18
            )Net
                income
            
            $
            86,678
            
            $
            23,506
            
            $
            1,499,318
            
            $
            248,336Net
                income per common share – basic
            
            $
            -
            
            $
            -
            
            $
            .04
            
            $
            .01Net
                income per common share – diluted
            
            $
            -
            
            $
            -
            
            $
            .04
            
            $
            .01Weighted
                average shares outstanding:Basic
                shares
            
            
            34,115,010
            
            
            33,961,639
            
            
            34,012,391
            
            
            33,856,712Diluted
                shares
            
            
            34,134,454
            
            
            34,162,532
            
            
            34,218,416
            
            
            34,363,106





The
      accompanying notes form an integral part of these condensed consolidated
      financial statements.




4




**RADIANT
      LOGISTICS, INC.**


**Condensed
      Consolidated Statement of Stockholders’ Equity**




COMMON
                STOCK
            
            ADDITIONAL
                  PAID-IN
            
            ACCUMULATED
            
            TOTAL
              STOCKHOLDERS'SHARES
            
            AMOUNT
            
            CAPITAL
            
            EARNINGS
            
            EQUITYBalance
                at June 30, 2007
            
            
            33,961,639
            
            $
            15,417
            
            $
            7,137,774
            
            $
            (108,850
            )
            $
            7,044,341Share
                based compensation (unaudited)
            
            
            -
            
            
            -
            
            
            150,384
            
            
            -
            
            
            150,384Shares
                issued to former Airgroup Shareholders pursuant to earnout obligations
            
            
            356,724
            
            
            357
            
            
            213,677
            
            
            -
            
            
            214,034Shares
              issuable for investor relations services
            
            
            83,333
            
            
            83
            
            
            37,417
            
            
            -
            
            
            37,500Net
                income for the nine months ended March 31, 2008 (unaudited)
            
            
            -
            
            
            -
            
            
            -
            
            
            1,499,318
            
            
            1,499,318Balance
                at March 31, 2008 (unaudited)
            
            
            34,401,696
            
            $
            15,857
            
            $
            7,539,252
            
            $
            1,390,468
            
            $
            8,945,577





The
      accompanying notes form an integral part of these condensed consolidated
      financial statements.





5




**RADIANT
      LOGISTICS, INC.**


**Condensed
      Consolidated Statements of Cash Flows**


**(unaudited)**




For nine months ended March 31,2008
            
            2007CASH
                FLOWS PROVIDED (USED FOR) OPERATING ACTIVITIES:Net
                income
            
            $
            1,499,318
            
            $
            248,336ADJUSTMENTS
                TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING
                ACTIVITIES:non-cash
                compensation expense (stock options)
            
            
            150,384
            
            
            141,876stock issuable
                for investor relations services
            
            
            37,500
            
            
            -amortization
                of intangibles
            
            
            410,520
            
            
            458,871amortization
                of deferred tax liability
            
            
            (139,578
            )
            
            (156,016
            )other
                deferred taxes
            
            
            (570,860
            )
            
            (6,661
            )depreciation
            
            
            293,655
            
            
            119,964amortization
                of bank fees
            
            
            16,251
            
            
            21,459amortization
                of employee loan receivable
            
            
            40,000
            
            
            40,000minority
                interest in (loss) or income of subsidiaries
            
            
            (45,642
            )
            
            12,018provision
                for doubtful accounts
            
            
            381,533
            
            
            23,369tax
                indemnity
            
            
            (486,694
            )
            
            -change
                in purchased accounts receivable
            
            
            -
            
            
            (6,128
            )CHANGE
                IN ASSETS AND LIABILITIES -accounts
                receivable
            
            
            1,145,236
            
            
            (3,182,902
            )employee
                receivable and other receivables
            
            
            (8,792
            )
            
            (1,271
            )prepaid
                expenses and other assets
            
            
            334,898
            
            
            (33,100
            )accounts
                payable and accrued transportation costs
            
            
            (3,346,953
            )
            
            3,458,480commissions
                payable
            
            
            455,542
            
            
            547,167other
                accrued costs
            
            
            (138,460
            )
            
            (47,966
            )income
                taxes payable
            
            
            860,221
            
            
            (880,564
            )Net
                cash provided by operating activities
            
            
            888,079
            
            
            756,932CASH
                FLOWS USED FOR INVESTING ACTIVITIES:acquisition
                of automotive assets
            
            
            (1,925,000)
            
            
            -purchase
                of technology and equipment
            
            
            (235,083
            )
            
            (187,239
            )Net
                cash used for investing activities
            
            
            (2,160,083
            )
            
            (187,239
            )CASH
                FLOWS PROVIDED (USED FOR) BY FINANCING ACTIVITIES:issuance
                of notes receivable
            
            
            (125,000)
            
            
            -net
                proceeds from (payment to) credit facility
            
            
            1,337,055
            
            
            (759,447
            )payments
                to former shareholders of Airgroup
            
            
            (500,000
            )
            
            -proceeds
                from note payable – acquisition of automotive assets
            
            
            120,000
            
            
            -Net
                cash provided by (used for) financing activities
            
            
            832,055
            
            
            (759,447
            )NET
                DECREASE IN CASH
            
            
            (439,949
            )
            
            (189,754
            )CASH,
                BEGINNING OF THE PERIOD
            
            
            719,575
            
            
            510,970CASH,
                END OF PERIOD
            
            $
            279,626
            
            $
            321,216SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION:Income
                taxes paid
            
            $
            622,595
            
            $
            987,689Interest
                paid
            
            $
            101,045
            
            $
            15,849





The
      accompanying notes form an integral part of these condensed consolidated
      financial statements.





6




**RADIANT
      LOGISTICS, INC.**


**Condensed
      Consolidated Statements of Cash Flows**


**(unaudited)**





**Supplemental
      disclosure of non-cash investing and financing activities:**





In
      September 2006, the Company issued 250,000 shares, of its common stock, at
      $1.01
      per share, in exchange for $252,500, in value, of domestic and international
      freight training materials for the development of its employees and exclusive
      agent offices.





In
      October 2006, the Company issued 100,000 shares of common stock, at a market
      value of $1.01 a share, as incentive compensation to its senior managers which
      was recorded against other accrued costs.





In
      March,
      2008 the Company issued 356,724 shares of common stock, in satisfaction of
      the
      $214,000 earnout obligation due to former Airgroup shareholders for the earnout
      period ended June 30, 2007.


7




**RADIANT
      LOGISTICS, INC.**


**Notes
      to Condensed Consolidated Financial Statements**


**(unaudited)**




**NOTE
      1 – NATURE OF OPERATION AND BASIS OF PRESENTATION**





**General**





Radiant
      Logistics, Inc. (the “Company”) is executing a strategy to build a global
      transportation and supply chain management company through organic growth and
      the strategic acquisition of regional best-of-breed non-asset based
      transportation and logistics providers to offer its customers domestic and
      international freight forwarding and an expanding array of value added supply
      chain management services, including order fulfillment, inventory management
      and
      warehousing.





The
      Company completed the first step in its business strategy through the
      acquisition of Airgroup Corporation (“Airgroup”) effective as of January 1,
      2006. Airgroup is a Seattle, Washington based non-asset based logistics company
      providing domestic and international freight forwarding services through a
      network of exclusive agent offices across North America.  Airgroup has a
      diversified account base including manufacturers, distributors and retailers
      using a network of independent carriers and international agents positioned
      strategically around the world.




By
      implementing a growth strategy based on the operations of Airgroup as a
      platform, the Company intends to build a leading global transportation and
      supply-chain management company offering a full range of domestic and
      international freight forwarding and other value added supply chain management
      services, including order fulfillment, inventory management and
      warehousing.





The
      Company’s growth strategy will focus on both organic growth and acquisitions.
      From an organic perspective, the Company will focus on strengthening existing
      and expanding new customer relationships. One of the drivers of the Company’s
      organic growth will be retaining existing, and securing new exclusive agency
      locations. Since the acquisition of Airgroup in January 2006, management focused
      its efforts on the build-out of the Company’s network of exclusive agency
      offices, as well as enhancing its back-office infrastructure and transportation
      and accounting systems.





As
      the
      Company continues to build out its network of exclusive agent locations to
      achieve a level of critical mass and scale, it intends to implement an
      acquisition strategy to develop additional growth opportunities. Implementation
      of an acquisition strategy will rely upon two primary factors: first,
      management’s ability to identify and acquire target businesses that fit within
      the Company’s general acquisition criteria and, second, the continued
      availability of capital and financing resources sufficient to complete these
      acquisitions. Following the acquisition of Airgroup, management has from
      time-to-time identified a number of additional companies as suitable acquisition
      candidates. The first transaction was the purchase of certain assets in Detroit
      Michigan to service the automotive industry which was consummated in November
      2007.  The
      Company will continue to search for targets that fit within its acquisition
      criteria. Management’s ability to secure additional financing will rely upon the
      sale of debt or equity securities, and the development of an active trading
      market for the Company’s securities, neither of which can be assured.





The
      Company’s growth strategy has been designed to take advantage of shifting market
      dynamics. The third party logistics industry continues to grow as an increasing
      number of businesses outsource their logistics functions to more cost
      effectively manage and extract value from their supply chains. The industry
      is
      positioned for further consolidation as it remains highly fragmented, and as
      customers are demanding the types of sophisticated and broad reaching service
      offerings that can more effectively be handled by larger more diverse
      organizations.





Successful
      implementation of the Company’s growth strategy depends upon a number of
      factors, including management’s ability to: (i) continue developing new agency
      locations; (ii) locate acquisition opportunities; (iii) secure adequate funding
      to finance identified acquisition opportunities; (iv) efficiently integrate
      the
      businesses of the companies acquired; (v) generate the anticipated economies
      of
      scale from the integration; and (vi) maintain the historic sales growth of
      the
      acquired businesses in order to generate continued organic growth. There are
      a
      variety of risks associated with management’s ability to achieve the Company’s
      strategic objectives, including the ability to acquire and profitably manage
      additional businesses and the intense competition in the industry for customers
      and for acquisition candidates.


8





**Interim
      Disclosure**





The
      condensed consolidated financial statements included herein have been prepared,
      without audit, pursuant to the rules and regulations of the Securities and
      Exchange Commission. Certain information and footnote disclosures normally
      included in financial statements prepared in accordance with accounting
      principles generally accepted in the United States have been condensed or
      omitted pursuant to such rules and regulations, although the Company’s
      management believes that the disclosures are adequate to make the information
      presented not misleading. The Company’s management suggests that these condensed
      financial statements be read in conjunction with the financial statements and
      the notes thereto included in the Company’s Annual Report on Form 10-K for the
      year ended June 30, 2007.





The
      interim period information included in this Quarterly Report on Form 10-Q
      reflects all adjustments, including the recognition of $1.4M in non-recurring
      income resulting from a change in estimate of liabilities of accrued
      transportation costs assumed in connection with the Company’s acquisition of
      Airgroup (See Note 3) and other normal recurring adjustments, that are, in
      the
      opinion of the Company’s management, necessary for a fair statement of the
      results of the respective interim periods. Results of operations for interim
      periods are not necessarily indicative of results to be expected for an entire
      year.





**Basis
      of Presentation**





The
      consolidated financial statements also include the accounts of Radiant
      Logistics, Inc. and its wholly-owned subsidiaries as well as a single
      variable interest entity, Radiant Logistics Partners LLC which is 40% owned
      by
      Airgroup, a wholly owned subsidiary of the Company, whose
      accounts are included in the consolidated financial statements in accordance
      with Financial Accounting Standards Board (“FASB”) Interpretation No. 46(R)
      consolidation of “Variable Interest Entities” (See Note 6). All
      significant inter-company balances and transactions have been
      eliminated.





**NOTE
      2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**





**a)**
              **Use
                  of Estimates**





The
      preparation of financial statements and related disclosures in accordance with
      accounting principles generally accepted in the United States of America
      requires management to make estimates and assumptions that affect the reported
      amounts of assets and liabilities and disclosure of contingent assets and
      liabilities at the date of the financial statements and the reported amounts
      of
      revenue and expenses during the reporting period. Such estimates include revenue
      recognition, accruals for the cost of purchased transportation, accounting
      for
      the issuance of shares and share based compensation, the assessment of the
      recoverability of long-lived assets (specifically goodwill and acquired
      intangibles), the establishment of an allowance for doubtful accounts and the
      valuation allowance for deferred tax assets. Estimates and assumptions are
      reviewed periodically and the effects of revisions are reflected in the period
      that they are determined to be necessary. Actual results could differ from
      those
      estimates.





**b)**
            **Cash
                and Cash Equivalents**





For
      purposes of the statement of cash flows, cash equivalents include all highly
      liquid investments with original maturities of three months or less which are
      not securing any corporate obligations.





**c)**
            **Concentration**





The
      Company maintains its cash in bank deposit accounts, which, at times, may exceed
      federally insured limits. The Company has not experienced any losses in such
      accounts.


9





**d)**
            **Accounts
                Receivable**





The
      Company’s receivables are recorded when billed and represent claims against
      third parties that will be settled in cash. The carrying value of the Company’s
      receivables, net of the allowance for doubtful accounts, represents their
      estimated net realizable value.   The Company evaluates the
      collectability of accounts receivable on a customer-by-customer basis. The
      Company records a reserve for bad debts against amounts due to reduce the net
      recognized receivable to an amount the Company believes will be reasonably
      collected. The reserve is a discretionary amount determined from the analysis
      of
      the aging of the accounts receivables, historical experience, and knowledge
      of
      specific customers.





**e)**
            **Property
                and Equipment**





Technology
      (computer software, hardware, and communications), furniture, and equipment
      are
      stated at cost, less accumulated depreciation over the estimated useful lives
      of
      the respective assets. Depreciation is computed using five to seven year lives
      for vehicles, communication, office, furniture, and computer equipment and
      the
      double declining balance method. Computer software is depreciated over a three
      year life using the straight line method of depreciation. For leasehold
      improvements, the cost is depreciated over the shorter of the lease term or
      useful life on a straight line basis. Upon retirement or other disposition
      of
      these assets, the cost and related accumulated depreciation are removed from
      the
      accounts and the resulting gain or loss, if any, is reflected in other income
      or
      expense. Expenditures for maintenance, repairs and renewals of minor items
      are
      charged to expense as incurred. Major renewals and improvements are capitalized.




Under
      the
      provisions of Statement of Position 98-1, “Accounting for the Costs of Computer
      Software Developed or Obtained for Internal Use”, the Company capitalizes costs
      associated with internally developed and/or purchased software systems that
      have
      reached the application development stage and meet recoverability tests.
      Capitalized costs include external direct costs of materials and services
      utilized in developing or obtaining internal-use software, payroll and
      payroll-related expenses for employees who are directly associated with and
      devote time to the internal-use software project and capitalized interest,
      if
      appropriate. Capitalization of such costs begins when the preliminary project
      stage is complete and ceases no later than the point at which the project is
      substantially complete and ready for its intended purpose.





Costs
      for
      general and administrative, overhead, maintenance and training, as well as
      the
      cost of software that does not add functionality to existing systems, are
      expensed as incurred.





**f)**
            **Goodwill**





The
      Company follows the provisions of Statement of Financial Accounting Standards
      ("SFAS") No. 142, “Goodwill and Other Intangible Assets.” SFAS No. 142 requires
      an annual impairment test for goodwill and intangible assets with indefinite
      lives. Under the provisions of SFAS No. 142, the first step of the impairment
      test requires the Company to determine the fair value of each reporting unit,
      and compare the fair value to the reporting unit's carrying amount. To the
      extent a reporting unit's carrying amount exceeds its fair value, an indication
      exists that the reporting unit's goodwill may be impaired and the Company must
      perform a second more detailed impairment assessment. The second impairment
      assessment involves allocating the reporting unit’s fair value to all of its
      recognized and unrecognized assets and liabilities in order to determine the
      implied fair value of the reporting unit’s goodwill as of the assessment date.
      The implied fair value of the reporting unit’s goodwill is then compared to the
      carrying amount of goodwill to quantify an impairment charge as of the
      assessment date. The Company performs its annual impairment test effective
      as of
      April 1 of each year, unless events or circumstances indicate an impairment
      may
      have occurred before that time. As of March 31, 2008, management
      believes there
      are
      no indications of an impairment.





**g)**
            **Long-Lived
                Assets**





Acquired
      intangibles consist of customer related intangibles and non-compete agreements
      arising from the Company’s acquisitions. Customer related intangibles are
      amortized using accelerated methods over approximately 5 years and non-compete
      agreements are amortized using the straight line method over a 5 year
      period.


10





The
      Company follows the provisions of SFAS No. 144, “Accounting for the Impairment
      or Disposal of Long-Lived Assets,” which establishes accounting standards for
      the impairment of long-lived assets such as property, plant and equipment and
      intangible assets subject to amortization. The Company reviews long-lived assets
      to be held-and-used for impairment whenever events or changes in circumstances
      indicate that the carrying amount of the assets may not be recoverable. If
      the
      sum of the undiscounted expected future cash flows over the remaining useful
      life of a long-lived asset is less than its carrying amount, the asset is
      considered to be impaired. Impairment losses are measured as the amount by
      which
      the carrying amount of the asset exceeds the fair value of the asset. When
      fair
      values are not available, the Company estimates fair value using the expected
      future cash flows discounted at a rate commensurate with the risks associated
      with the recovery of the asset. Assets to be disposed of are reported at the
      lower of carrying amount or fair value less costs to sell. Management
      has performed a review of all long-lived assets and has determined that no
      impairment of the respective carrying value has occurred as of March 31, 2008.





**h)**
            **Commitments**





The
      Company has operating lease commitments some of which are for office and
      warehouse space and are under non-cancelable operating leases expiring at
      various dates through December 2012. Future annual commitments for years ending
      June 30, 2008 through 2012, respectively, are $79,790, $294,686, $117,278,
      $62,825, and $2,432.





**i)**
            **Income
                Taxes**




Taxes
      on
      income are provided in accordance with SFAS No. 109, “Accounting for
      Income Taxes.” ** Deferred
      income tax assets and liabilities are recognized for the expected future tax
      consequences of events that have been reflected in the consolidated financial
      statements. Deferred tax assets and liabilities are determined based on the
      differences between the book values and the tax bases of particular assets
      and
      liabilities. Deferred tax assets and liabilities are measured using tax rates
      in
      effect for the years in which the differences are expected to reverse. A
      valuation allowance is provided to offset the net deferred tax assets if, based
      upon the available evidence, it is more likely than not that some or all of
      the
      deferred tax assets will not be realized.





**j)**
            **Revenue
                Recognition and Purchased Transportation
                Costs**





The
      Company recognizes revenue on a gross basis, in accordance with Emerging Issues
      Task Force ("EITF") 91-9, "Reporting Revenue Gross versus Net," as a result
      of
      the following: The Company is the primary obligor responsible for providing
      the
      service desired by the customer and is responsible for fulfillment, including
      the acceptability of the service(s) ordered or purchased by the customer. At
      the
      Company’s sole discretion, it sets the prices charged to its customers, and is
      not required to obtain approval or consent from any other party in establishing
      its prices. The Company has multiple suppliers for the services it sells to
      its
      customers, and has the absolute and complete discretion and right to select
      the
      supplier that will provide the product(s) or service(s) ordered by a customer,
      including changing the supplier on a shipment-by-shipment basis. In most cases,
      the Company determines the nature, type, characteristics, and specifications
      of
      the service(s) ordered by the customer. The Company also assumes credit risk
      for
      the amount billed to the customer.




As
      a
      non-asset based carrier, the Company does not own transportation assets. The
      Company generates the major portion of its air and ocean freight revenues by
      purchasing transportation services from direct (asset-based) carriers and
      reselling those services to its customers. In accordance with EITF 91-9, revenue
      from freight forwarding and export services is recognized at the time the
      freight is tendered to the direct carrier at origin, and direct expenses
      associated with the cost of transportation are accrued concurrently. At
      the
      time when revenue is recognized on a transportation shipment, the Company
      records costs related to that shipment based on the estimate of total purchased
      transportation costs. The estimates are based upon anticipated margins,
      contractual arrangements with direct carriers and other known factors. The
      estimates are routinely monitored and compared to actual invoiced costs. The
      estimates are adjusted as deemed necessary by the Company to reflect differences
      between the original accruals and actual costs of purchased transportation.


11




**k)**
            **Share
                based Compensation**





The
      Company follows the provisions of SFAS No. 123R, "Share Based Payment,” a
      revision of FASB Statement No. 123 ("SFAS 123R"). This statement requires that
      the cost resulting from all share-based payment transactions be recognized
      in
      the Company’s consolidated financial statements. In addition, the Company
      follows the guidance of the Securities and Exchange Commission ("SEC") Staff
      Accounting Bulletin No. 107, "Share-Based Payment" ("SAB 107"). SAB 107 provides
      the SEC’s staff’s position regarding the application of SFAS 123R and certain
      SEC rules and regulations, and also provides the staff’s views regarding the
      valuation of share-based payment arrangements for public companies. SFAS 123R
      requires all share-based payments to employees, including grants of employee
      stock options, to be recognized in the statement of operations based on their
      fair values.





For
      the
      three months ended March 31, 2008, the Company recorded a share based
      compensation expense of $57,282, which, net of income taxes, resulted in a
      $37,806 net reduction of net income. For the three months ended March 31, 2007,
      the Company recorded a share based compensation expense of $49,255, which,
      net
      of income taxes, resulted in a $32,508 net reduction of net income. For the
      nine
      months ended March 31, 2008, the Company recorded a share based compensation
      expense of $150,384, which, net of income taxes, resulted in a $99,253 net
      reduction of net income. For the nine months ended March 31, 2007, the Company
      recorded a share based compensation expense of $141,876, which, net of income
      taxes, resulted in a $93,638 net reduction of net income.





**l)**
            **Basic
                and Diluted Income Per Share**





The
      Company uses SFAS No. 128, Earnings Per Share for calculating the basic and
      diluted income per share. Basic income per share is computed by dividing net
      income attributable to common stockholders by the weighted average number of
      common shares outstanding. Diluted income per share is computed similar to
      basic
      income per share except that the denominator is increased to include the number
      of additional common shares that would have been outstanding if the potential
      common shares had been issued and if the additional common shares were
      dilutive.





For
      three
      months ended March 31, 2008 and 2007, the weighted average outstanding number
      of
      dilutive common shares totaled 34,134,454 and 34,162,532 shares of common stock.
      Options to purchase 2,580,000 shares of common stock were not included in the
      diluted EPS computation for the three months ended March 31, 2008 as the
      exercise prices of those options were greater than the market price of the
      common shares and are thus anti-dilutive. Options to purchase 1,145,000 shares
      of common stock were not included in the diluted EPS computation for the three
      months ended March 31, 2007 as the exercise prices of those options were greater
      than the market price of the common shares and are thus
      anti-dilutive.





For
      the
      nine months ended March 31, 2008 and 2007, the weighted average outstanding
      number of dilutive common shares totaled 34,218,416 and 34,363,106 shares of
      common stock. Options to purchase 2,580,000 shares of common stock were not
      included in the diluted EPS computation for the nine months ended March 31,
      2008
      as the exercise prices of those options were greater than the market price
      of
      the common shares and are thus anti-dilutive. Options to purchase 1,145,000
      shares of common stock were not included in the diluted EPS computation for
      the
      nine months ended March 31, 2007 as the exercise prices of those options were
      greater than the market price of the common shares and are thus
      anti-dilutive.





The
      following table reconciles the numerator and denominator of the basic and
      diluted per share computations for earnings per share as follows.





Three
              months
              ended
              March
                31,
              2008
            
            Three
              months
              ended
              March
                31,
              2007
            
            Nine
              months
              ended
              March
                31,
              2008
            
            Nine
              months
              ended
              March
                31,
              2007Weighted
                average basic shares outstanding
            
            
            34,115,010
            
            
            33,961,639
            
            
            34,012,391
            
            
            33,856,712Options
            
            
            19,444
            
            
            200,893
            
            
            206,025
            
            
            506,394Weighted
                average dilutive shares outstanding
            
            
            34,134,454
            
            
            34,162,532
            
            
            34,218,416
            
            
            34,363,106





**m)**
            **Reclassifications**





Certain
      amounts for prior periods have been reclassified in the consolidated financial
      statements to conform to the classification used in fiscal
      2008.


12





**NOTE
      3 – ACQUISITION OF AIRGROUP**





In
      January of 2006, the Company acquired 100 percent of the outstanding stock
      of
      Airgroup. The transaction was valued at up to $14.0 million. This consisted
      of:
      (i) $9.5 million payable in cash at closing (before giving effect for $2.8
      million in acquired cash); (ii) a subsequent cash payment of $0.5 million in
      cash due on the two year anniversary; (iii)
      as
      amended, an additional base payment of $0.6 million payable in cash with
      $300,000 payable on June 30, 2008 and $300,000 payable on January 1, 2009;
      (iv)
      a base earn-out payment of $1.9 million payable in Company common stock over
      a
      three-year earn-out period based upon Airgroup achieving income from continuing
      operations of not less than $2.5 million per year; and
      (v)
      as additional incentive to achieve future earnings growth, an opportunity to
      earn up to an additional $1.5 million payable in Company common stock at the
      end
      of a five-year earn-out period (the “Tier-2 Earn-Out”). Under Airgroup’s Tier-2
      Earn-Out, the former shareholders of Airgroup are entitled to receive 50% of
      the
      cumulative income from continuing operations in excess of $15,000,000 generated
      during the five-year earn-out period up to a maximum of $1,500,000. With respect
      to the base earn-out payment of $1.9 million, in the event there is a shortfall
      in income from continuing operations, the earn-out payment will be reduced
      on a
      dollar-for-dollar basis to the extent of the shortfall. Shortfalls may be
      carried over or carried back to the extent that income from continuing
      operations in any other payout year exceeds the $2.5 million level. The $0.5
      million payment listed above was paid in December 2007. Through the most recent
      earn-out period ended June 30, 2007, the former Airgroup shareholders earned
      a
      total of $214,000 in base earn-out payments, which was satisfied by issuing
      356,724 shares to the former Airgroup shareholders on February 28,
      2008 .





In
      the
      quarter ended December 31, 2007, the Company reduced the estimate of accrued
      transportation costs assumed in the acquisition of Airgroup. This adjustment
      was
      made with the benefit of 2 years of operating experience and resulted in the
      recognition of approximately $1.4 million in non-recurring income. Pursuant
      to
      the acquisition agreement, the former shareholders of Airgroup have indemnified
      the Company for taxes of $487,000 associated with the income recognized in
      connection with this change in estimate. The tax indemnity has been reflected
      as
      a reduction of the additional base payment otherwise payable to the former
      shareholders of Airgroup.





**NOTE
      4 – ACQUIRED INTANGIBLE ASSETS**





The
      table
      below reflects acquired intangible assets related to the acquisition of Airgroup
      on January 1, 2006. The information is for the nine months ended March 31,
      2008
      and year ended June 30, 2007. Prior to the Company’s acquisition of Airgroup,
      there were no intangible assets for prior years as this was the Company’s first
      acquisition.


13




Nine months ended
                March
                  31, 2008
              
              Year
                  ended
                June 30, 2007Gross
                carrying
                amount
              
              Accumulated
                Amortization
              
              Gross
                carrying
                amount
              
              Accumulated
                AmortizationAmortizable
                  intangible assets:Customer
                  related
              
              $
              2,652,000
              
              $
              1,322,247
              
              $
              2,652,000
              
              $
              925,227Covenants
                  not to compete
              
              
              90,000
              
              
              40,500
              
              
              90,000
              
              
              27,000Total
              
              $
              2,742,000
              
              $
              1,362,747
              
              $
              2,742,000
              
              $
              952,227Aggregate
                  amortization expense:For
                  nine months endedMarch
                  31, 2008
              
              
              
              
              $
              410,520For
                  nine months endedMarch
                  31, 2007
              
              
              
              
              $
              458,871Aggregate
                  amortization expense for the year ended June 30:2008 – For
                  the remainder of the year
              
              
              
              
              
              136,8392009
              
              
              
              
              
              597,0902010
              
              
              
              
              
              483,1242011
              
              
              
              
              
              162,200Total
              
              
              
              
              $
              1,379,253





For
      the
      nine months ended March 31, 2008, the Company recorded an expense of $410,520
      from amortization of intangibles and an income tax benefit of $139,578 from
      amortization of the long term deferred tax liability; both arising from the
      acquisition of Airgroup. For the nine months ended March 31, 2007, the Company
      recorded an expense of $458,871 from amortization of intangibles and an income
      tax benefit of $156,016 from amortization of the long term deferred tax
      liability; both arising from the acquisition of Airgroup. The Company expects
      the net reduction in income, from the combination of amortization of intangibles
      and long term deferred tax liability, will be $361,257 in 2008, $394,079 in
      2009, $318,862 in 2010, and $107,052 in 2011.





**NOTE
      5 – ACQUISITION OF ASSETS - AUTOMOTIVE**





In
      November 2007 **,** the
      Company completed a restructured transaction with Mass Financial Corporation
      (“Mass”) to acquire certain assets to service the automotive industry in
      Detroit, Michigan (the “Purchased Assets”) through its wholly-owned subsidiary,
      Radiant Logistics Global Services, Inc. (“RLGS”).





Under
      the
      terms of the initial agreement, the transaction was valued at up to $2.75 million. As restructured, the purchase
      price was reduced to $1.56 million, consisting of cash of $560,000 and a $1.0
      million credit in satisfaction of indemnity claims asserted by the Company
      arising from its interim operation of the Purchased Assets since May 22, 2007.
      Of the cash component of the transaction, $100,000 was paid in May of 2007,
      $265,000 was paid at closing and a final payment of $195,000 is to be paid
      in
      November of 2008, subject to off-set of up to $75,000 for certain qualifying
      expenses incurred by the Company.





The
      total
      estimated purchase price of the acquired assets is $1.925 million, which is
      comprised of the $1.56 million purchase price along with an additional $365,000
      in estimated acquisition expenses. The following table summarizes the
      preliminary allocation of the purchase price based on the estimated fair value
      of the acquired assets at November 1, 2007. No liabilities were assumed in
      connection with the transaction:





Furniture
                and equipment
            
            $
            25,000Goodwill
                and other intangibles
            
            
            1,900,000Total
                acquired assets
            
            
            1,925,000Total
                acquired liabilities
            
            
            -Net
                assets acquired
            
            $
            1,925,000


14





The
      above
      allocation is still preliminary and the Company expects to finalize it prior
      to
      the November 2008 anniversary of the acquisition of Purchased Assets as required
      per SFAS 141.





**NOTE
      6 – VARIABLE INTEREST ENTITY**





FIN46(R)
      clarifies the application of Accounting Research Bulletin No. 51 “Consolidated
      Financial Statements,” to certain entities in which equity investors do not have
      the characteristics of a controlling financial interest or do not have the
      sufficient equity at risk for the entity to finance its activities without
      additional subordinated financial support from other parties (“variable interest
      entities”). Radiant Logistics Partners LLC (“RLP”) is 40% owned by Airgroup
      Corporation and qualifies under FIN46(R) as a variable interest entity and
      is
      included in the Company’s consolidated financial statements. Minority interest
      income for the three and nine months ending March 31, 2008 was $13,696 and
      $45,642, respectively. RLP commenced operations in February 2007. Minority
      interest expense for the three and nine months ending March 31, 2007 was $18.





**NOTE
      7 – RELATED PARTY**





RLP
      is
      owned 40% by Airgroup and 60% by an affiliate of the Chief Executive Officer
      of
      the Company, Radiant Capital Partners (RCP). RLP is a certified minority
      business enterprise which was formed for the purpose of providing the Company
      with a national accounts strategy to pursue corporate and government accounts
      with diversity initiatives. As currently structured, RCP’s ownership interest
      entitles it to a majority of the profits and distributable cash, if any,
      generated by RLP. The operations of RLP are intended to provide certain benefits
      to the Company, including expanding the scope of services offered by the Company
      and participating in supplier diversity programs not otherwise available to
      the
      Company. As the RLP operations mature, the Company will evaluate and approve
      all
      related service agreements between the Company and RLP, including the scope
      of
      the services to be provided by the Company to RLP and the fees payable to the
      Company by RLP, in accordance with the Company’s corporate governance principles
      and applicable Delaware corporation law. This process may include seeking the
      opinion of a qualified third party concerning the fairness of any such agreement
      or the approval of the Company’s shareholders. Under FIN46(R), RLP is
      consolidated in the financial statements of the Company (see Note
      6).





**NOTE
      8 – PROPERTY AND EQUIPMENT**





The
      Company, prior to acquiring Airgroup, did not carry any fixed assets since
      its
      inception. Property and equipment consists of the following:





March 31,
              2008
            
            June 30,
              2007Vehicles
            
            $
            3,500
            
            $
            3,500Communication
                equipment
            
            
            1,353
            
            
            1,353Office
                equipment
            
            
            261,633
            
            
            261,633Furniture
                and fixtures
            
            
            47,191
            
            
            23,379Computer
                equipment
            
            
            276,654
            
            
            232,667Computer
                software
            
            
            745,997
            
            
            570,494Leasehold
                improvements
            
            
            26,645
            
            
            10,6991,362,973
            
            
            1,103,725Less:
                Accumulated depreciation and amortization
            
            
            (552,460
            )
            
            (258,806
            )Property
                and equipment - net
            
            $
            810,513
            
            $
            844,919


15





Depreciation
      and amortization expense for the three and nine months ended March 31, 2008
      was
      $238,822 and $720,426, respectively, and for the three and nine months ended
      March 31, 2007 was $209,348 and $600,295, respectively.





**NOTE
      9 – LONG TERM DEBT**





In
      February 2008, our
      $10
      million revolving credit facility (Facility) was extended into 2011. The
      Facility is collateralized by accounts receivable and other assets of the
      Company and its subsidiaries. Advances under the Facility are available to
      fund
      future acquisitions, capital expenditures or for other corporate purposes.
      Borrowings under the facility bear interest, at the Company’s option, at the
      Bank’s prime rate minus .15% to 1.00% or LIBOR plus 1.55% to 2.25%, and can be
      adjusted up or down during the term of the Facility based on our performance
      relative to certain financial covenants. The Facility provides for advances
      of
      up to 80% of the Company’s eligible accounts receivable.





As
      of
      March 31, 2008, the Company had approximately $2.3 million outstanding under
      the
      Facility and had eligible accounts receivable sufficient to support
      approximately $7.4 million in borrowings. The terms of the Facility are subject
      to certain financial and operational covenants which may limit the amount
      otherwise available under the Facility. The first covenant limits funded debt
      to
      a multiple of 3.00 times the Company’s consolidated EBITDA measured on a rolling
      four quarter basis (or a multiple of 3.25 at a reduced advance rate of 75.0%).
      The second financial covenant requires the Company to maintain a basic fixed
      charge coverage ratio of at least 1.1 to 1.0. The third financial covenant
      is a
      minimum profitability standard that requires the Company not to incur a net
      loss
      before taxes, amortization of acquired intangibles and extraordinary items
      in
      any two consecutive quarterly accounting periods.




Under
      the
      terms of the Facility, the Company is permitted to make additional acquisitions
      without the lender's consent only if certain conditions are satisfied. The
      conditions imposed by the Facility include the following: (i) the absence of
      an
      event of default under the Facility, (ii) the company to be acquired must be
      in
      the transportation and logistics industry, (iii) the purchase price to be paid
      must be consistent with the Company’s historical business and acquisition model,
      (iv) after giving effect for the funding of the acquisition, the Company must
      have undrawn availability of at least $1.0 million under the Facility, (v)
      the
      lender must be reasonably satisfied with projected financial statements the
      Company provides covering a 12 month period following the acquisition, (vi)
      the
      acquisition documents must be provided to the lender and must be consistent
      with
      the description of the transaction provided to the lender, and (vii) the number
      of permitted acquisitions is limited to three per calendar year and shall not
      exceed $7.5 million in aggregate purchase price financed by funded debt. In
      the
      event that the Company is not able to satisfy the conditions of the Facility
      in
      connection with a proposed acquisition, it must either forego the acquisition,
      obtain the lender's consent, or retire the Facility. This may limit or slow
      the
      Company’s ability to achieve the critical mass it may need to achieve our
      strategic objectives. At March 31, 2008, the Company was in compliance with
      all
      of its covenants.





As
      of
      March 31, **** 2008
      the
      Company had $2,304,783 drawn under the Facility and $706,486 in outstanding
      checks which have not yet been presented to the bank for payment. The
      outstanding checks have been reclassified from cash accounts, as they will
      be
      advanced from, or against, the Facility when presented for payment to the bank.
      These amounts total long term debt of $3,011,269.





At
      March
      31 , **** 2008,
      based on available collateral and $315,000 in outstanding letter of credit
      commitments, there was $4,817,890 available for borrowing under the
      Facility.





**NOTE
      10 – PROVISION FOR INCOME TAXES**





Deferred
      income taxes are reported using the liability method. Deferred tax assets are
      recognized for deductible temporary differences and deferred tax liabilities
      are
      recognized for taxable temporary differences. Temporary differences are the
      differences between the reported amounts of assets and liabilities and their
      tax
      bases. Deferred tax assets are reduced by a valuation allowance when, in the
      opinion of management, it is more likely than not that some portion or all
      of
      the deferred tax assets will not be realized. Deferred tax assets and
      liabilities are adjusted for the effects of changes in tax laws and rates on
      the
      date of enactment.


16





For
      the
      three months ended March 31, 2008, the Company recognized net
      income tax expense of $35,841 consisting of current income tax expense of
      $71,432, and deferred income tax benefit of $35,591.





For
      the
      nine months ended March 31, 2008, the Company recognized net
      income tax expense of $772,378 consisting of current income tax expense of
      $1,482,816 and deferred income tax benefit of $710,438.





For
      the
      three months ended March 31, 2007, the Company recognized net
      income tax expense of $37,449 consisting of current income tax expense of
      $77,519 and deferred income tax benefit of $40,070.





For
      the
      nine months ended March 31, 2007, the Company recognized net
      income tax expense of $18,327 consisting of current income tax expense of
      $181,004 and deferred income tax benefit of $162,677.





The
      Company’s consolidated effective tax rate during the three and nine month
      periods ended March 31, 2008 and March 31, 2007 was 34.0%.





**NOTE
      11 – STOCKHOLDERS’ EQUITY**





**Preferred
      Stock**





The
      Company is authorized to issue 5,000,000 shares of preferred stock, par value
      at
      $.001 per share. As of March 31, 2008, none of the shares were issued or
      outstanding (unaudited).





**Common
      Stock**





In
      September 2006, the Company issued 250,000 shares of our common stock, at $1.01
      per share, in exchange for $252,500, in value, of domestic and international
      freight training materials for the development of its employees and exclusive
      agent offices. In October 2006, the Company issued 100,000 shares of common
      stock, at a market value of $1.01 a share, as incentive compensation to its
      senior managers which was recorded against other accrued costs.





In
      February of 2008, the Company agreed to issue 250,000 shares of common stock
      to
      a financial advisor to provide investor relations and financial advisory
      services to the Company. These shares are to vest ratably over the six month
      engagement and will be issued in a transaction exempt from registration under
      the Securities Act in reliance on Section 4(2) of the Securities Act.





In
      February, 2008 the Company issued 356,724 shares of common stock, in
      satisfaction of the $214,000 earnout obligation due to former Airgroup
      shareholders for the earnout period ended June 30, 2007 .





**NOTE
      12 – SHARE BASED COMPENSATION**





The
      Company issued its first employee options in October of 2005 and adopted the
      fair value recognition provisions of SFAS123R concurrent with this initial
      grant.




For
      the
      three and nine months ended March 31, 2008, the Company issued employees options
      to purchase 175,000 shares of common stock at $0.48 per share in December 2007,
      and 50,000 shares of common stock at $.35 per share in March 2008. The options
      vest 20% per year over a five year term.




Share
      based compensation costs recognized during the three and nine months ended
      March
      31, 2008, includes compensation cost for all share-based payments granted to
      date, based on the grant-date fair value estimated in accordance with the
      provisions of SFAS 123R. No options have been exercised as of March 31,
      2008.





For
      the
      nine months ended March 31, 2008, the weighted average fair value per share
      of
      employee options granted in December 2007 was $.29. The weighted average fair
      value per share of employee options granted in March 2008 was $.21. The fair
      value of options granted were estimated on the date of grant using the
      Black-Scholes option pricing model, with the following assumptions for each
      issuance of options:


17





December
              2007
            
            March
              2008Dividend
                yield
            None
            
            NoneVolatility
            68.7%
            
            67.8%Risk
                free interest rate
            3.49%
            
            3.49%Expected
                lives
            5.0
                years
            
            5.0
                years





In
      accordance with SFAS123R, the Company is required to estimate the number of
      awards that are ultimately expected to vest. Due to the lack of historical
      information, the Company has not reduced its share based compensation costs
      for
      any estimated forfeitures. Estimated forfeitures will be reassessed in
      subsequent periods and may change based on new facts and
      circumstances.





For
      the
      nine months ended March 31, 2008 and 2007, the Company recognized stock option
      compensation costs of $150,384 and $141,876, respectively, in accordance with
      SFAS 123R. The following table summarizes activity under the plan for the nine
      months ended March 31, 2008.





Number of
              shares
            
            Weighted
                Average
              exercise price
              per
                share
            
            Weighted
              average
              remaining
              contractual
              life
            
            Aggregate
              intrinsic
              valueOutstanding
                at June 30, 2007
            
            
            3,150,000
            
            $
            0.605
            
            
            8.75
                years
            
            $
            -Options
                granted
            
            
            225,000
            
            
            0.451
            
            
            9.76
                years
            
            
            -Options
                exercised
            
            
            -
            
            
            -
            
            
            -
            
            
            -Options
                forfeited
            
            
            (370,000
            )
            
            0.628
            
            
            -
            
            
            -Options
                expired
            
            
            -
            
            
            -
            
            
            -
            
            
            -Outstanding
                at March 31, 2008
            
            
            3,005,000
            
            $
            0.591
            
            
            7.94
                years
            
            $
            -Exercisable
                at March 31, 2008
            
            
            989,000
            
            $
            0.598
            
            
            7.64
                years
            
            $
            -




The
      aggregate intrinsic value for all outstanding options as of March 31, 2008
      was
      $1,500. The aggregate intrinsic value for all vested options was $0 due to
      the
      strike price of all vested options exceeding the market price of the Company’s
      stock.





**NOTE
      13 – RECENT ACCOUNTING PRONOUNCEMENTS**




In
      December 2007, the FASB issued SFAS No. 141(R), *“Business
      Combinations”* (“SFAS
      141(R)”), which replaces SFAS No. 141. SFAS No. 141(R) establishes principles
      and requirements for how an acquirer recognizes and measures in its financial
      statements the identifiable assets acquired, the liabilities assumed, any
      non-controlling interest in the acquiree and the goodwill acquired. The
      Statement also establishes disclosure requirements which will enable users
      to
      evaluate the nature and financial effects of the business combination. SFAS
      141(R) is effective for fiscal years beginning after December 15, 2008. The
      adoption of SFAS 141(R) will have an impact on accounting for business
      combinations once adopted, but the effect is dependent upon acquisitions at
      that
      time.




In
      December 2007, the FASB issued SFAS No. 160, *“Noncontrolling
      Interests in Consolidated Financial Statements – an amendment of Accounting
      Research Bulletin No. 51”* (“SFAS
      160”), which establishes accounting and reporting standards for ownership
      interests in subsidiaries held by parties other than the parent, the amount
      of
      consolidated net income attributable to the parent and to the noncontrolling
      interest, changes in a parent’s ownership interest and the valuation of retained
      non-controlling equity investments when a subsidiary is deconsolidated. The
      Statement also establishes reporting requirements that provide sufficient
      disclosures that clearly identify and distinguish between the interests of
      the
      parent and the interests of the non-controlling owners. SFAS 160 is effective
      for fiscal years beginning after December 15, 2008. The Company has not
      determined the effect that the application of SFAS 160 will have on its
      consolidated financial statements.


18





**CAUTIONARY
      STATEMENT REGARDING FORWARD-LOOKING STATEMENTS**





This
      report includes forward-looking statements within the meaning of Section 27A
      of
      the Securities Act of 1933, as amended, and Section 21E of the Securities
      Exchange Act of 1934, as amended, regarding future operating performance,
      events, trends and plans. All statements other than statements of historical
      facts included or incorporated by reference in this report, including, without
      limitation, statements regarding our future financial position, business
      strategy, budgets, projected revenues, projected costs and plans and objectives
      of management for future operations, are forward-looking statements. In
      addition, forward-looking statements generally can be identified by the use
      of
      forward-looking terminology such as “may,” “will,” “expects,” “intends,”
“plans,” “projects,” “estimates,” “anticipates,” or “believes” or the negative
      thereof or any variation thereon or similar terminology or expressions.





We
      have
      based these forward-looking statements on our current expectations, projections
      and assumptions about future events. These forward-looking statements are not
      guarantees and are subject to known and unknown risks, uncertainties and
      assumptions about us that, if not realized, may cause our actual results, levels
      of activity, performance or achievements to be materially different from any
      future results, levels of activity, performance or achievements expressed or
      implied by such forward-looking statements. While it is impossible to identify
      all of the factors that may cause our actual operating performance, events,
      trends or plans to differ materially from those set forth in such
      forward-looking statements, such factors include our ability to: (i) to use
      Airgroup as a “platform” upon which we can build a profitable global
      transportation and supply chain management company; (ii) retain and build upon
      the relationships we have with our exclusive agency offices; (iii) continue
      the
      development of our back office infrastructure and transportation and accounting
      systems in a manner sufficient to service our expanding revenues and base of
      exclusive agency locations; (iv) continue growing our business and maintain
      historical or increased gross profit margins; (v) locate suitable acquisition
      opportunities; (vi) secure the financing necessary to complete any acquisition
      opportunities we locate; (vii) assess and respond to competitive practices
      in
      the industries in which we compete, (viii) mitigate, to the best extent
      possible, our dependence on current management and certain of our larger
      exclusive agency locations; (ix) assess and respond to the impact of current
      and
      future laws and governmental regulations affecting the transportation industry
      in general and our operations in particular; and (x) assess and respond to
      such
      other factors which may be identified from time to time in our Securities and
      Exchange Commission (SEC) filings and other public announcements including
      those
      set forth in Item 1A of our Annual Report on Form 10-K for the year ended June
      30, 2007. Furthermore, the general business assumptions underlying the
      forward-looking statements included herein represent estimates of future events
      and are subject to uncertainty due to, among other things, changes in economic,
      legislative, industry, and other circumstances. As a result, the identification,
      interpretation and use of data and other information in developing and selecting
      assumptions from and among reasonable alternatives require the exercise of
      judgment. To the extent that the assumed events do not occur, the outcome may
      vary substantially from anticipated or projected results, and, accordingly,
      we
      can provide no assurance regarding the achievability of the results identified
      in such forward-looking statements. Except as required by law, we undertake
      no
      obligation to publicly release the result of any revision of these
      forward-looking statements to reflect events or circumstances after the date
      they are made or to reflect the occurrence of unanticipated events.





**ITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS**





***The
      following discussion and analysis of our financial condition and result of
      operations should be read in conjunction with the financial statements and
      the
      related notes and other information included elsewhere in this
      report.***





**Overview**





Radiant
      Logistics, Inc. (the “Company”) is executing a strategy to build a global
      transportation and supply chain management company through organic growth and
      the strategic acquisition of regional best-of-breed non-asset based
      transportation and logistics providers to offer its customers domestic and
      international freight forwarding and an expanding array of value added supply
      chain management services, including order fulfillment, inventory management
      and
      warehousing.


19




We
      completed the first step in our business strategy through the acquisition of
      Airgroup effective as of January 1, 2006. Airgroup is a Seattle, Washington
      based non-asset based logistics company providing domestic and international
      freight forwarding services through a network of exclusive agent offices across
      North America.  Airgroup has a diversified account base including
      manufacturers, distributors and retailers using a network of independent
      carriers and international agents positioned strategically around the
      world .





By
      implementing a growth strategy, we intend to build a leading global
      transportation and supply-chain management company offering a full range of
      domestic and international freight forwarding and other value added supply
      chain
      management services, including order fulfillment, inventory management and
      warehousing.





As
      a
      non-asset based provider of third-party logistics services, we seek to limit
      our
      investment in equipment, facilities and working capital through contracts and
      preferred provider arrangements with various transportation providers who
      generally provide us with favorable rates, minimum service levels, capacity
      assurances and priority handling status. Our non-asset based approach allows
      us
      to maintain a high level of operating flexibility and leverage a cost structure
      that is highly variable in nature while the volume of our flow of freight
      enables us to negotiate attractive pricing with our transportation
      providers.





Our
      principal source of income is derived from freight forwarding services. As
      a
      freight forwarder, we arrange for the shipment of our customers’ freight from
      point of origin to point of destination. Generally, we quote our customers
      a
      turn key cost for the movement of their freight. Our price quote will often
      depend upon the customer’s time-definite needs (first day through fifth day
      delivery), special handling needs (heavy equipment, delicate items,
      environmentally sensitive goods, electronic components, etc.) and the means
      of
      transport (truck, air, ocean or rail). In turn, we assume the responsibility
      for
      arranging and paying for the underlying means of transportation.





**Performance
      Metrics**




Our
      transportation revenue represents the total dollar value of services we sell
      to
      our customers. Our cost of transportation includes direct costs of
      transportation, including motor carrier, air, ocean and rail services. We act
      principally as the service provider to add value in the execution and
      procurement of these services to our customers. Our net transportation revenue
      (gross transportation revenue less the direct cost of transportation) is the
      primary indicator of our ability to source, add value and resell services
      provided by third parties, and is considered by management to be a key
      performance measure. In addition, management believes measuring its operating
      costs as a function of net transportation revenue provides a useful metric,
      as
      our ability to control costs as a function of net transportation revenue
      directly impacts operating earnings.




Our
      operating results will be affected as acquisitions occur. Since all acquisitions
      are made using the purchase method of accounting for business combinations,
      our
      financial statements will only include the results of operations and cash flows
      of acquired companies for periods subsequent to the date of
      acquisition.




Our
      GAAP
      based net income will be affected by non-cash charges relating to the
      amortization of customer related intangible assets and other intangible assets
      arising from completed acquisitions. Under applicable accounting standards,
      purchasers are required to allocate the total consideration in a business
      combination to the identified assets acquired and liabilities assumed based
      on
      their fair values at the time of acquisition. The excess of the consideration
      paid over the fair value of the identifiable net assets acquired is to be
      allocated to goodwill, which is tested at least annually for impairment.
      Applicable accounting standards require that we separately account for and
      value
      certain identifiable intangible assets based on the unique facts and
      circumstances of each acquisition. As a result of our acquisition strategy,
      our
      net income will include material non-cash charges relating to the amortization
      of customer related intangible assets and other intangible assets acquired
      in
      our acquisitions. Although these charges may increase as we complete more
      acquisitions, we believe we will actually be growing the value of our intangible
      assets (e.g., customer relationships). Thus, we believe that earnings before
      interest, taxes, depreciation and amortization, or EBITDA, is a useful financial
      measure for investors because it eliminates the effect of these non-cash costs
      and provides an important metric for our business. Further, the financial
      covenants of our credit facility adjust EBITDA to exclude costs related to
      share
      based compensation expense and other non-cash charges. Accordingly, we intend
      to
      employ EBITDA and adjusted EBITDA as management tools to measure our
      historical financial performance and as a benchmark for future financial
      flexibility.


20




Our
      operating results are also subject to seasonal trends when measured on a
      quarterly basis. The impact of seasonality on our business will depend on
      numerous factors, including the markets in which we operate, holiday seasons,
      consumer demand and economic conditions. Since our revenue is largely derived
      from customers whose shipments are dependent upon consumer demand and
      just-in-time production schedules, the timing of our revenue is often beyond
      our
      control. Factors such as shifting demand for retail goods and/or manufacturing
      production delays could unexpectedly affect the timing of our revenue. As we
      increase the scale of our operations, seasonal trends in one area of our
      business may be offset to an extent by opposite trends in another area. We
      cannot accurately predict the timing of these factors, nor can we accurately
      estimate the impact of any particular factor, and thus we can give no assurance
      that historical seasonal patterns will continue in future periods.





**Results
      of Operations**





***For
      the three months ended March 31, 2008 (unaudited) and March 31, 2007 (
      unaudited)***




We
      generated transportation revenue of $25.8 million and $19.4 million and net
      transportation revenue of $9.5 million and $7.1 million for the three months
      ended March 31, 2008 and 2007 respectively. Net income was $87,000 for the
      three
      months ended March 31, 2008 compared to net income of $24,000 for the three
      months ended March 31, 2007.





We
      had
      adjusted earnings before interest, taxes, depreciation and amortization (EBITDA)
      of $495,000 and $328,000 for three months ended March 31, 2008 and 2007,
      respectively. EBITDA, is a non-GAAP measure of income and does not include
      the
      effects of interest and taxes, and excludes the “non-cash” effects of
      depreciation and amortization on current assets. Companies have some discretion
      as to which elements of depreciation and amortization are excluded in the EBITDA
      calculation. We exclude all depreciation charges related to property, plant
      and
      equipment, and all amortization charges, including amortization of leasehold
      improvements and other intangible assets. We then further adjust EBITDA to
      exclude extraordinary items and costs related to share based compensation
      expense and other non-cash charges consistent with the financial covenants
      of
      our credit facility. As explained above, we believe that EBITDA is useful to
      us
      and to our investors in evaluating and measuring our financial performance.
      While management considers EBITDA and adjusted EBITDA useful in analyzing our
      results, it is not intended to replace any presentation included in our
      consolidated financial statements. Set forth below is a reconciliation of EBITDA
      and adjusted EBITDA to net income, the most directly comparable GAAP measure
      for
      the three months ended March 31, 2008 and 2007 .





Three months ended March 31,
            
            Change2008
            
            2007
            
            Amount
            
            PercentNet
                income
            
            $
            87
            
            $
            24
            
            $
            63
            
            
            262.5
            %Income
                tax expense (benefit)
            
            
            36
            
            
            37
            
            
            (1
            )
            
            (2.7
            )%Interest
                expense – net
            
            
            26
            
            
            3
            
            
            23
            
            
            766.7
            %Depreciation
                and amortization
            
            
            239
            
            
            209
            
            
            30
            
            
            14.4
            %EBITDA
                (Earnings before interest, taxes, depreciation and
                amortization)
            
            $
            388
            
            $
            273
            
            $
            115
            
            
            42.1
            %Share
                based compensation and other non-cash costs
            
            
            107
            
            
            55
            
            
            52
            
            
            94.5
            %Adjusted
                EBITDA
            
            $
            495
            
            $
            328
            
            $
            167
            
            
            50.9
            %


21





**The
      following table summarizes March 31, 2008 (unaudited) and March 31, 2007
      (unaudited) transportation revenue, cost of transportation and net
      transportation revenue (in thousands)** *:*




Three months ended March 31,
            
            Change2008
            
            2007
            
            Amount
            
            PercentTransportation
                revenue
            
            $
            25,765
            
            $
            19,394
            
            $
            6,371
            
            
            32.9
            %Cost
                of transportation
            
            
            16,264
            
            
            12,278
            
            
            3,986
            
            
            32.5
            %Net
                transportation revenue
            
            $
            9,501
            
            $
            7,116
            
            $
            2,385
            
            
            33.5
            %*Net
                transportation margins*
            
            
            36.9
            %
            
            36.7
            %




Transportation
      revenue was $25.8 million for the three months ended March 31, 2008, an increase
      of 32.9% over transportation revenue of $19.4 million for the three months
      ended
      March 31, 2007. Domestic transportation revenue increased by 20.8% to $15.0
      million for the three months ended March 31, 2008 from $12.4 million for the
      three months ended March 31, 2007. The increase was primarily due to increased
      volume handled by us in 2008. International transportation revenue increased
      by
      54.3% to $10.7 million for the three months ended March 31, 2008 from $7.0
      million for the comparable prior year period, mainly attributed to increased
      air
      and ocean export freight volume.





Cost
      of
      transportation increased to $16.3 million for the three months ended March
      31,
      2008 compared to $12.3 million for the three months ended March 31, 2007 as
      a
      result of the increased transportation volumes described above.





Net
      transportation margins remained relatively unchanged at 36.9% of transportation
      revenue for the three months ended March 31, 2008 as compared to 36.7% of
      transportation revenue for the three months ended March 31, 2007.





**The
      following table compares certain March 31, 2008 (unaudited) and March 31, 2007
      (unaudited) condensed consolidated statement of income data as a percentage
      of
      our net transportation revenue (in thousands)** *:*





Three months ended March 31,2008
            
            2007
            
            ChangeAmount
            
            Percent
            
            Amount
            
            Percent
            
            Amount
            
            PercentNet
                transportation revenue
            
            $
            9,501
            
            
            100.0
            %
            $
            7,116
            
            
            100.0
            %
            $
            2,385
            
            
            33.5
            %Agent
                commissions
            
            
            6,611
            
            
            69.6
            %
            
            5,420
            
            
            76.2
            %
            
            1,191
            
            
            22.0
            %Personnel
                costs
            
            
            1,199
            
            
            12.6
            %
            
            659
            
            
            9.3
            %
            
            540
            
            
            81.9
            %Other
                selling, general and administrative
            
            
            1,269
            
            
            13.4
            %
            
            742
            
            
            10.4
            %
            
            527
            
            
            71.0
            %Depreciation
                and amortization
            
            
            239
            
            
            2.5
            %
            
            209
            
            
            2.9
            %
            
            30
            
            
            14.4
            %Total
                operating costs
            
            
            9,318
            
            
            98.1
            %
            
            7,030
            
            
            98.8
            %
            
            2,288
            
            
            32.5
            %Income
                from operations
            
            
            183
            
            
            1.9
            %
            
            86
            
            
            1.2
            %
            
            97
            
            
            112.8
            %Other
                income (expense)
            
            
            (74
            )
            
            (0.8
            )%
            
            (25
            )
            
            (0.3
            )%
            
            (49
            )
            
            NMIncome
                before income taxes and minority interests
            
            
            109
            
            
            1.1
            %
            
            61
            
            
            0.9
            %
            
            48
            
            
            78.7
            %Income
                tax expense
            
            
            36
            
            
            0.4
            %
            
            37
            
            
            0.5
            %
            
            (1
            )
            
            (2.7
            )%Income
                before minority interests
            
            
            73
            
            
            0.8
            %
            
            24
            
            
            0.3
            %
            
            49
            
            
            204.2
            %Minority
                interests
            
            
            14
            
            
            0.2
            %
            
            -
            
            
            -
            
            
            14
            
            
            NMNet
                income
            
            $
            87
            
            
            0.9
            %
            $
            24
            
            
            0.3
            %
            $
            63
            
            
            262.5
            %


22




Agent
      commissions were $6.6 million for the three months ended March 31, 2008, an
      increase of 22% from $5.4 million for the three months ended March 31, 2007.
      Agent commissions as a percentage of net transportation revenue decreased to
      69.6% for three months ended March 31, 2008 from 76.2% for the comparable prior
      year period as a result of the introduction of Company owned operations in
      Detroit where operations were not subject to agent commissions.





Personnel
      costs were $1.2 million for the three months ended March 31, 2008, an increase
      of 81.9% from $659,000 for the three months ended March 31, 2007. Personnel
      costs as a percentage of net transportation revenue increased to 12.6% for
      three
      months ended March 31, 2008 from 9.3% for the comparable prior year period
      primarily as a result of the increased head-count associated with operations
      in
      Detroit.





Other
      selling, general and administrative costs were $1,269,000 for the three months
      ended March 31, 2008, an increase of 71.0% from $742,000 for the three months
      ended March 31, 2007. As a percentage of net transportation revenue, other
      selling, general and administrative costs increased to 13.4% for three months
      ended March 31, 2008 from 10.4% for the comparable prior year period.





Depreciation
      and amortization costs were approximately $239,000 and $209,000 for the three
      months ended March 31, 2008 and 2007, respectively. Depreciation and
      amortization as a percentage of net transportation revenue decreased for three
      months ended March 31, 2008 to 2.5% from 2.9% for the same period last year.





Income
      from operations was $183,000 for the three months ended March 31, 2008 compared
      to income from operations of $86,000 for the three months ended March 31,
      2007.





Other
      expense was $74,000 for the three months ended March 31, 2008 compared to other
      expense of $25,000 for the three months ended March 31, 2007.





Net
      income was $87,000 for the three months ended March 31, 2008, compared to net
      income of $24,000 for the three months ended March 31, 2007.





******For
      the nine months ended March 31, 2008 (unaudited) and March 31, 2007
      (unaudited****** ***)***




We
      generated transportation revenue of $74.4 million and $52.2 million and net
      transportation revenue of $26.3 million and $18.8 million for the nine months
      ended March 31, 2008 and 2007, respectively. Net income was $1,499,000 for
      the
      nine months ended March 31, 2008 compared net income of $248,000 for the nine
      months ended March 31, 2007.





We
      had
      adjusted earnings before interest, taxes, depreciation and amortization (EBITDA)
      of $1,416,000 and $1,062,000 for nine months ended March 31, 2008 and 2007,
      respectively. EBITDA, is a non-GAAP measure of income and does not include
      the
      effects of interest and taxes, and excludes the “non-cash” effects of
      depreciation and amortization on current assets. Companies have some discretion
      as to which elements of depreciation and amortization are excluded in the EBITDA
      calculation. We exclude all depreciation charges related to property, plant
      and
      equipment, and all amortization charges, including amortization of leasehold
      improvements and other intangible assets. We then further adjust EBITDA to
      exclude extraordinary items and costs related to share based compensation
      expense and other non-cash charges consistent with the financial covenants
      of
      our credit facility. As explained above, we believe that EBITDA is useful to
      us
      and to our investors in evaluating and measuring our financial performance.
      While management considers EBITDA and adjusted EBITDA useful in analyzing our
      results, it is not intended to replace any presentation included in our
      consolidated financial statements. Set forth below is a reconciliation of EBITDA
      and adjusted EBITDA to net income, the most directly comparable GAAP measure
      for
      the nine months ended March 31, 2008 and 2007.


23





Nine months ended March 31,
            
            Change2008
            
            2007
            
            Amount
            
            PercentNet
                income
            
            $
            1,499
            
            $
            248
            
            $
            1,251
            
            
            504.4
            %Income
                tax expense
            
            
            772
            
            
            18
            
            
            754
            
            
            NMInterest
                expense – net
            
            
            98
            
            
            9
            
            
            89
            
            
            NMDepreciation
                and amortization
            
            
            721
            
            
            600
            
            
            121
            
            
            20.2
            %EBITDA
                (Earnings before interest, taxes, depreciation and
                amortization)
            
            $
            3,090
            
            $
            875
            
            $
            2,215
            
            
            253.1
            %Share
                based compensation and other non-cash costs
            
            
            244
            
            
            187
            
            
            (57
            )
            
            30.4
            %Change
                in estimate of liabilities assumed in Airgroup acquisition
            
            
            (1,431
            )
            
            -
            
            
            (1,431
            )
            
            NMTax
                Indemnity
            
            
            (487
            )
            
            -
            
            
            (487
            )
            
            NMAdjusted
                EBITDA
            
            $
            1,416
            
            $
            1,062
            
            $
            354
            
            
            33.3
            %





**The
      following table summarizes March 31, 2008 (unaudited) and March 31, 2007
      (unaudited) transportation revenue, cost of transportation and net
      transportation revenue (in thousands)** *:*




Nine months ended March 31,
            
            Change2008
            
            2007
            
            Amount
            
            PercentTransportation
                revenue
            
            $
            74,431
            
            $
            52,155
            
            $
            22,276
            
            
            42.7
            %Cost
                of transportation
            
            
            48,093
            
            
            33,357
            
            
            14,736
            
            
            44.2
            %Net
                transportation revenue
            
            $
            26,338
            
            $
            18,798
            
            $
            7,540
            
            
            40.1
            %*Net
                transportation margins*
            
            
            35.4
            %
            
            36.0
            %




Transportation
      revenue was $74.4 million for the nine months ended March 31, 2008, an increase
      of 42.7% over transportation revenue of $52.2 million for the nine months ended
      March 31, 2007. Domestic transportation revenue increased by 43.5% to $46.9
      million for the nine months ended March 31, 2008 from $32.7 million for the
      nine
      months ended March 31, 2007. The increase was primarily due to increased volume
      handled by us in 2008. International transportation revenue increased by 41.4%
      to $27.5 million for the nine months ended March 31, 2008 from $19.5 million
      for
      the comparable prior year period, mainly attributed to increased air and ocean
      export freight volume.





Cost
      of
      transportation increased to $48.1 million for the nine months ended March 31,
      2008 from $33.4 million for the nine months ended March 31, 2007 as a result
      of
      the additional volumes described above.





Net
      transportation margins decreased slightly to 35.4% of transportation revenue
      for
      the nine months ended March 31, 2008 from 36.0% of transportation revenue for
      the nine months ended March 31, 2007 as a result of increased international
      volumes which traditionally provide lower margins.


24





**The
      following table compares certain March 31, 2008 (unaudited) and March 31, 2007
      (unaudited) condensed consolidated statement of income data as a percentage
      of
      our net transportation revenue (in thousands)** *:*





Nine months ended March 31,2008
            
            2007
            
            ChangeAmount
            
            Percent
            
            Amount
            
            Percent
            
            Amount
            
            PercentNet
                transportation revenue
            
            $
            26,338
            
            
            100.0
            %
            $
            18,798
            
            
            100.0
            %
            $
            7,540
            
            
            40.1
            %Agent
                commissions
            
            
            18,617
            
            
            70.7
            %
            
            14,390
            
            
            76.6
            %
            
            4,227
            
            
            29.4
            %Personnel
                costs
            
            
            3,837
            
            
            14.6
            %
            
            1,747
            
            
            9.3
            %
            
            2,090
            
            
            119.6
            %Other
                selling, general and administrative
            
            
            2,704
            
            
            10.3
            %
            
            1,761
            
            
            9.4
            %
            
            943
            
            
            53.6
            %Depreciation
                and amortization
            
            
            720
            
            
            2.7
            %
            
            600
            
            
            3.2
            %
            
            120
            
            
            20.0
            %Total
                operating costs
            
            
            25,878
            
            
            98.3
            %
            
            18,498
            
            
            98.4
            %
            
            7,380
            
            
            39.9
            %Income
                from operations
            
            
            460
            
            
            1.8
            %
            
            300
            
            
            1.6
            %
            
            160
            
            
            53.3
            %Other
                income (expense)
            
            
            1,766
            
            
            6.7
            %
            
            (33
            )
            
            (0.2
            )%
            
            1,799
            
            
            NMIncome
                before income taxes and minority interests
            
            
            2,226
            
            
            8.5
            %
            
            267
            
            
            1.4
            %
            
            1,960
            
            
            NMIncome
                tax expense
            
            
            772
            
            
            2.9
            %
            
            19
            
            
            0.1
            %
            
            754
            
            
            NMIncome
                before minority interests
            
            
            1,454
            
            
            5.5
            %
            
            248
            
            
            1.3
            %
            
            1,206
            
            
            NMMinority
                interests
            
            
            45
            
            
            0.2
            %
            
            -
            
            
            -
            
            
            45
            
            
            NMNet
                income
            
            $
            1,499
            
            
            5.7
            %
            $
            248
            
            
            1.3
            %
            $
            1,251
            
            
            504.4
            %




Agent
      commissions were $18.6 million for the nine months ended March 31, 2008, an
      increase of 29.4% from $14.4 million for the nine months ended March 31, 2007.
      Agent commissions as a percentage of net transportation revenue decreased to
      70.7% for nine months ended March 31, 2008 from 76.6% for the comparable prior
      year period as a result of the introduction of Company owned operations in
      Detroit where operations were not subject to agent commissions.





Personnel
      costs were $3.8 million for the nine months ended March 31, 2008, an increase
      of
      119.6% from $1.7 million for the nine months ended March 31, 2007. Personnel
      costs as a percentage of net transportation revenue increased to 14.6% for
      nine
      months ended March 31, 2008 from 9.3% for the comparable prior year period
      primarily as a result of the increased head-count associated with new company
      owned stations.





Other
      selling, general and administrative costs were $2.7 million for the nine months
      ended March 31, 2008, an increase of 53.6% from $1.8 million for the nine months
      ended March 31, 2007. As a percentage of net transportation revenue, other
      selling, general and administrative costs increased to 10.3% for nine months
      ended March 31, 2008 from 9.4% for the comparable prior year period. The $2.7
      million in other selling, general and administrative costs is net of $804,000
      in
      expenses associated with the Detroit operations which we recorded as an asset
      on
      our balance sheet as an offset against payments to be made for the acquired
      assets.





Depreciation
      and amortization costs were approximately $720,000 and $600,000 for the nine
      months ended March 31, 2008 and 2007, respectively. Depreciation and
      amortization as a percentage of net transportation revenue decreased for nine
      months ended March 31, 2008 to 2.7% from 3.2% for the same period last year.


25





Income
      from operations was $460,000 for the nine months ended March 31, 2008 compared
      to income from operations of $300,000 for the nine months ended March 31,
      2007.





Other
      income was $1.8 million for the nine months ended March 31, 2008 compared to
      other expense of $33,000 for the nine months ended March 31, 2007. Other income
      for the nine months ended March 31, 2008 was driven principally by the $1.4
      million change in estimate of the liabilities assumed in the acquisition of
      Airgroup combined with an additional $487,000 income recognized as a result
      of
      the related tax indemnity.





Net
      income was $1,499,000 for the nine months ended March 31, 2008, compared to
      net
      income of $248,000 for the nine months ended March 31, 2007.




**Liquidity
      and Capital Resources**





Effective
      January 1, 2006, we acquired 100 percent of the outstanding stock of Airgroup.
      The transaction was valued at up to $14.0
      million. This consisted of: (i) $9.5 million payable in cash at closing; (ii)
      a
      subsequent cash payment of $0.5 million due on the two-year anniversary of
      the
      closing; (iii) as amended, an additional base payment of $0.6 million payable
      in
      cash with $300,000 payable on June 30, 2008 and $300,000 payable on January
      1,
      2009; (iv) a base earn-out payment of $1.9 million payable in Company common
      stock over a three-year earn-out period based upon Airgroup achieving income
      from continuing operations of not less than $2.5 million per year; and (v)
      as
      additional incentive to achieve future earnings growth, an opportunity to earn
      up to an additional $1.5 million payable in Company common stock at the end
      of a
      five-year earn-out period (the “Tier-2 Earn-Out”). Under Airgroup’s Tier-2
      Earn-Out, the former shareholders of Airgroup are entitled to receive 50% of
      the
      cumulative income from continuing operations in excess of $15,000,000 generated
      during the five-year earn-out period up to a maximum of $1,500,000. With respect
      to the base earn-out payment of $1.9 million, i n
      the
      event there is a shortfall in income from continuing operations, the earn-out
      payment will be reduced on a dollar-for-dollar basis to the extent of the
      shortfall. Shortfalls may be carried over or carried back to the extent that income
      from continuing operations in
      any
      other payout year exceeds the $2.5 million level. The $.05 million payment
      listed above was paid in December 2007. Through the most recent earn-out period
      ended June 30, 2007, the former shareholders of Airgroup earned $214,000 in
      base
      earn-out payments, which was satisfied by issuing 356,724 shares to the former
      Airgroup shareholders on February 28, 2008 .




In
      the
      quarter ended December 31, 2007, we adjusted the estimate of accrued
      transportation costs assumed in the acquisition of Airgroup which resulted
      in
      the recognition of approximately $1.4 million in non-recurring income. Pursuant
      to the acquisition agreement, the former shareholders of Airgroup have
      indemnified us for taxes of $487,000 associated the income recognized in
      connection with this change in estimate which has been reflected as a reduction
      of the additional base payment otherwise payable to the former shareholders
      of
      Airgroup.




Assuming
      minimum targeted earnings levels are achieved, the following table summarizes
      our contingent base earn-out payments related to the acquisition of Airgroup
      for
      the fiscal years indicated based on results of the prior year (in
      thousands):





**2009**
            
            **2010**
            
            **Total**Earn-out
                payments:Cash
            
            $
            —
            
            $
            —
            
            $
            —Equity
            
            
            633
            
            
            634
            
            
            1,267Total
                potential earn-out payments
            
            $
            633
            
            $
            634
            
            $
            1,267Prior
                year earnings targets (income from continuing operations)Total
                earnings actual and targets
            
            $
            2,500
            
            $
            2,500
            
            $
            5,000Earn-outs
                as a percentage of prior year earnings targets:Total
            
            
            25.3
            %
            
            25.3
            %
            
            25.3
            %


26





In
      February 2008,our
      $10
      million revolving credit facility (Facility) was extended from February 2009
      until February 2011.The
      Facility is collateralized by our accounts receivable and other assets of the
      Company and our subsidiaries. Advances under the Facility are available to
      fund
      future acquisitions, capital expenditures or for other corporate purposes.
      Borrowings under the facility bear interest, at the our option, at the Bank’s
      prime rate minus .15% to 1.00% or LIBOR plus 1.55% to 2.25%, and can be adjusted
      up or down during the term of the Facility based on our performance relative
      to
      certain financial covenants. The Facility provides for advances of up to 80%
      of
      our eligible accounts receivable.





A s
      of
      April 30, 2008, we had approximately $2.7 million outstanding under the Facility
      and we had eligible accounts receivable sufficient to support approximately
      $7.8
      million in borrowings. The terms of the Facility are subject to certain
      financial and operational covenants which may limit the amount otherwise
      available under the Facility. The first covenant limits funded debt to a
      multiple of 3.00 times the Company’s consolidated EBITDA measured on a rolling
      four quarter basis (or a multiple of 3.25 at a reduced advance rate of 75.0%).
      The second financial covenant requires the Company to maintain a funded debt
      to
      EBDITA ratio of 3.25 to 1.0. The third financial covenant requires the Company
      to maintain a basic fixed charge coverage ratio of at least 1.1 to 1.0. The
      fourth financial covenant is a minimum profitability standard that requires
      the
      Company not to incur a net loss before taxes, amortization of acquired
      intangibles and extraordinary items in any two consecutive quarterly accounting
      periods .




Under
      the
      terms of the Facility, the Company is permitted to make additional acquisitions
      without the lender's consent only if certain conditions are satisfied. The
      conditions imposed by the Facility include the following: (i) the absence of
      an
      event of default under the Facility, (ii) the company to be acquired must be
      in
      the transportation and logistics industry, (iii) the purchase price to be paid
      must be consistent with the Company’s historical business and acquisition model,
      (iv) after giving effect for the funding of the acquisition, the Company must
      have undrawn availability of at least $1.0 million under the Facility, (v)
      the
      lender must be reasonably satisfied with projected financial statements the
      Company provides covering a 12 month period following the acquisition, (vi)
      the
      acquisition documents must be provided to the lender and must be consistent
      with
      the description of the transaction provided to the lender, and (vii) the number
      of permitted acquisitions is limited to three per calendar year and shall not
      exceed $7.5 million in aggregate purchase price financed by funded debt. In
      the
      event that the Company is not able to satisfy the conditions of the Facility
      in
      connection with a proposed acquisition, it must either forego the acquisition,
      obtain the lender's consent, or retire the Facility. This may limit or slow
      our
      ability to achieve the critical mass we may need to achieve our strategic
      objectives.





Net
      cash
      provided by operating activities for the nine months ended March 31, 2008 was
      $888,000 compared to net cash provided by operating activities of $757,000
      for
      the nine months ended March 31, 2007. Net cash provided by operating activities
      includes a use of cash of $487,000 in tax indemnity from the former Airgroup
      shareholders. This indemnity was taken as an off-set to amounts otherwise due
      the former Airgroup shareholders in future periods. See Note 3 to our Condensed
      Financial Statements included in Part I, Item 1 above.





Cash
      used
      for investing activities for the nine months ended March 31, 2008, totaled
      $2,160,000 of which approximately $1.9 million related to the acquisition of
      the
      automotive assets in Detroit with the remaining $200,000 related to investments
      in technology. For the nine months ended March 31, 2007, cash used for investing
      was $187,000 and principally related to investments in technology.





Net
      cash
      provided by financing activities for the nine months ended March 31, 2008 was
      $832,000 which includes advances under our credit facility of $1,337,000 and
      $120,000 in notes payable to Mass Financial issued in connection with the
      acquisition of the automotive assets. These amounts were off-set by $500,000
      paid to former Airgroup shareholders, and a note receivable issued for $125,000.
      For the comparable prior year period, net cash provided by financing activities
      was limited to repayments to our credit facility of $759,000.


27





In
      November 2007 **,** we
      completed a restructured transaction with Mass Financial Corporation (“Mass”) to
      acquire certain assets to service the automotive industry in Detroit, Michigan
      (the “Purchased Assets”).





As
      restructured, the purchase price has been reduced to $1.56 million, consisting
      of cash of $560,000 and a $1.0 million credit in satisfaction of indemnity
      claims asserted by us arising from our interim operation of the Purchased Assets
      since May 22, 2007. Of the cash component of the transaction, $100,000 was
      paid
      in May of 2007, $265,000 was paid at closing and a final payment of $195,000
      is
      to be paid in November of 2008, subject to off-set of up to $75,000 for certain
      qualifying expenses incurred by the Company.





During
      the early portion of fiscal 2008, our cash flow was adversely affected as a
      result of the garnishment proceeding instituted by a judgment creditor of the
      prior owner of the Purchased Assets which temporarily frustrated our ability
      to
      collect outstanding customer receivables and service new and existing customers.
      The garnishment action was ultimately brought to a standstill in September
      of
      2007. For the period from May 22, 2007 through October 31, 2007, while operating
      the Purchased Assets under the Management Services Agreement (the “MSA”) with
      Mass, we incurred an aggregate of $1,000,000 of reimbursable operating expenses
      (of which approximately $196,000, $392,000 , $412,000 were incurred in the
      quarters ended June 30, 2007, September 30, 2007 and December 31, 2007,
      respectively). These expenses were, to a large extent, influenced by the
      decrease in revenue caused by the garnishment proceedings, and in any event,
      were recaptured in the form of an indemnity claim against Mass which was
      satisfied via an off-set to amounts otherwise payable to Mass in connection
      with
      the acquisition of the automotive assets in Detroit. While operating the
      Purchased Assets we have exited certain low margin business and secured
      additional new business. While we believe we have secured a profitable core
      group of customers from which to operate in Detroit going forward, we may be
      required to make further cash outlays in the development of our automotive
      services group which would require increased draws against our
      Facility.





Given
      our
      continued focus on the build-out of our network of exclusive agency locations,
      we believe that our current working capital and anticipated cash flow from
      operations are adequate to fund existing operations. However, should we attempt
      to build the business through strategic acquisitions; we will require additional
      sources of financing as our existing working capital is not sufficient to
      finance our operations and an acquisition program. Thus, our ability to finance
      future acquisitions will be limited by the availability of additional capital.
      We may, however, finance acquisitions using our common stock as all or some
      portion of the consideration. In the event that our common stock does not attain
      or maintain a sufficient market value or potential acquisition candidates are
      otherwise unwilling to accept our securities as part of the purchase price
      for
      the sale of their businesses, we may be required to utilize more of our cash
      resources, if available, in order to continue our acquisition program. If we
      do
      not have sufficient cash resources through either operations or from debt
      facilities, our growth could be limited unless we are able to obtain such
      additional capital. In this regard and in the course of executing our
      acquisition strategy, we expect to pursue an additional equity offering within
      the next twelve months.





**Off
      Balance Sheet Arrangements**





As
      of March
      31 ,
      2008,
      we did not have any relationships with unconsolidated entities or financial
      partners, such as entities often referred to as structured finance or special
      purpose entities, which had been established for the purpose of facilitating
      off-balance sheet arrangements or other contractually narrow or limited
      purposes. As such, we are not materially exposed to any financing, liquidity,
      market or credit risk that could arise if we had engaged in such relationships.




**Critical
      Accounting Policies**





Accounting
      policies, methods and estimates are an integral part of the consolidated
      financial statements prepared by management and are based upon management's
      current judgments. Those judgments are normally based on knowledge and
      experience with regard to past and current events and assumptions about future
      events. Certain accounting policies, methods and estimates are particularly
      sensitive because of their significance to the financial statements and because
      of the possibility that future events affecting them may differ from
      management's current judgments. While there are a number of accounting policies,
      methods and estimates that affect our financial statements, the areas that
      are
      particularly significant include the assessment of the recoverability of
      long-lived assets, specifically goodwill, acquired intangibles, and revenue
      recognition.


28





We
      follow
      the provisions of Statement of Financial Accounting Standards ("SFAS") No.
      142,
      Goodwill and Other Intangible Assets. SFAS No. 142 requires an annual impairment
      test for goodwill and intangible assets with indefinite lives. Under the
      provisions of SFAS No. 142, the first step of the impairment test requires
      that
      we determine the fair value of each reporting unit, and compare the fair value
      to the reporting unit's carrying amount. To the extent a reporting unit's
      carrying amount exceeds its fair value, an indication exists that the reporting
      unit's goodwill may be impaired and we must perform a second more detailed
      impairment assessment. The second impairment assessment involves allocating
      the
      reporting unit’s fair value to all of its recognized and unrecognized assets and
      liabilities in order to determine the implied fair value of the reporting unit’s
      goodwill as of the assessment date. The implied fair value of the reporting
      unit’s goodwill is then compared to the carrying amount of goodwill to quantify
      an impairment charge as of the assessment date. In the future, we will perform
      our annual impairment test during our fiscal fourth quarter unless events or
      circumstances indicate an impairment may have occurred before that
      time.





Acquired
      intangibles consist of customer related intangibles and non-compete agreements
      arising from our acquisitions. Customer related intangibles will be amortized
      using accelerated methods over approximately 5 years and non-compete agreements
      will be amortized using the straight line method over a 5 year
      period.





We
      follow
      the provisions of SFAS No. 144, Accounting for the Impairment or Disposal of
      Long-Lived Assets, which establishes accounting standards for the impairment
      of
      long-lived assets such as property, plant and equipment and intangible assets
      subject to amortization. We review long-lived assets to be held-and-used for
      impairment whenever events or changes in circumstances indicate that the
      carrying amount of the assets may not be recoverable. If the sum of the
      undiscounted expected future cash flows over the remaining useful life of a
      long-lived asset is less than its carrying amount, the asset is considered
      to be
      impaired. Impairment losses are measured as the amount by which the carrying
      amount of the asset exceeds the fair value of the asset. When fair values are
      not available, we estimates fair value using the expected future cash flows
      discounted at a rate commensurate with the risks associated with the recovery
      of
      the asset. Assets to be disposed of are reported at the lower of carrying amount
      or fair value less costs to sell.





As
      a
      non-asset based carrier, we do not own transportation assets. We generate the
      major portion of our air and ocean freight revenues by purchasing transportation
      services from direct (asset-based) carriers and reselling those services to
      our
      customers. In accordance with Emerging Issues Task Force ("EITF") 91-9 "Revenue
      and Expense Recognition for Freight Services in Process", revenue from freight
      forwarding and export services is recognized at the time the freight is tendered
      to the direct carrier at origin, and direct expenses associated with the cost
      of
      transportation are accrued concurrently. These
      accrued purchased transportation costs are estimates based upon anticipated
      margins, contractual arrangements with direct carriers and other known factors.
      The estimates are routinely monitored and compared to actual invoiced costs.
      The
      estimates are adjusted as deemed necessary to reflect differences between the
      original accruals and actual costs of purchased transportation.





We
      recognize revenue on a gross basis, in accordance with EITF 99-19, "Reporting
      Revenue Gross versus Net", as a result of the following: We are the primary
      obligor responsible for providing the service desired by the customer and are
      responsible for fulfillment, including the acceptability of the service(s)
      ordered or purchased by the customer. We, at our sole discretion, set the prices
      charged to our customers, and are not required to obtain approval or consent
      from any other party in establishing our prices. We have multiple suppliers
      for
      the services we sell to our customers, and have the absolute and complete
      discretion and right to select the supplier that will provide the product(s)
      or
      service(s) ordered by a customer, including changing the supplier on a
      shipment-by-shipment basis. In most cases, we determine the nature, type,
      characteristics, and specifications of the service(s) ordered by the customer.
      We also assume credit risk for the amount billed to the
      customer.


29




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




Our
      exposure to market risk for changes in interest rates relates primarily to
      our
      short-term cash investments and our line of credit. We are averse to principal
      loss and ensure the safety and preservation of our invested funds by limiting
      default risk, market risk and reinvestment risk. We invest our excess cash
      in
      institutional money market accounts. We do not use interest rate derivative
      instruments to manage our exposure to interest rate changes. If market interest
      rates were to change by 10% from the levels at December 31, 2007, the change
      in
      interest expense would have had an immaterial impact on our results of
      operations and cash flows.




**Item
      4T.**  **Controls
      and Procedures.**





An
      evaluation of the effectiveness of our "disclosure controls and procedures"
      (as
      such term is defined in Rules 13a-15(e) or 15d-15(e) of the Securities Exchange
      Act of 1934, as amended (the "Exchange Act") as of March 31, 2008 was carried
      out by our management under the supervision and with the participation of our
      Chief Executive Officer ("CEO") who also serves as our Chief Financial Officer
      ("CFO"). Based upon that evaluation, our CEO/CFO concluded that, as of March
      31,
      2008, our disclosure controls and procedures were effective to provide
      reasonable assurance that information we are required to disclose in reports
      that we file or submit under the Exchange Act is (i) recorded, processed,
      summarized and reported within the time periods specified in the Securities
      and
      Exchange Commission rules and forms and (ii) accumulated and communicated to
      our
      management, including our CEO/CFO, as appropriate to allow timely decisions
      regarding disclosure. There were no changes to our internal control over
      financial reporting during the fiscal quarter ended March 31, 2008 that
      materially affected, or are reasonably likely to materially affect, our internal
      control over financial reporting.


30




**PART
      II. OTHER INFORMATION**




**Item
      1. Legal Proceedings.**




From
      time
      to time, our operating subsidiary, Airgroup, is involved in legal matters or
      named as a defendant in legal actions arising in its ordinary course of
      business. Management believes that these matters will not have a material
      adverse effect on our financial statements.





**Item
      2. Recent Sales of Unregistered Securities and Use of
      Proceeds.**





Effective
      February 1, 2008 we agreed to issue 250,000 shares of common stock to a
      financial advisor in consideration of investor relations and financial advisory
      services to be provided to the Company. These shares will vest ratably over
      the
      six month engagement. The shares were issued to one accredited investor without
      payment of underwriting discounts or commissions to any person and without
      engaging in any general solicitation or advertising of any kind in a private
      placement transaction exempt from the registration requirements of the
      Securities Act of 1933, as amended, pursuant to Section 4(2)
      thereunder.


On
        February 28, 2008, we issued 356,724 shares of common stock to the former
        shareholders of Airgroup in satisfaction of the $214,000 earnout obligation
        due
        for the earnout period ended June 30, 2007 in accordance with the securities
        purchase agreement by and among us and the former shareholders of Airgroup.
        The
        shares were issued to a limited number of accredited investors without payment
        of underwriting discounts or commissions to any person without engaging in
        any
        general solicitation or advertising of any kind in a private placement
        transaction exempt from the registration requirements of the Securities Act
        of
        1933, as amended, pursuant to Section 4(2) thereunder .





**Item
      6. Exhibits**




**Exhibit**
              **No.**
            
            **Exhibit**
            
            **Method
                of**
              **Filing**31.1
            
            Certification
                by Principal Executive Officer and Principal Financial Officer pursuant
                to
                Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934,
                as
                amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley
                Act of
                2002
            
            Filed
              herewith32.1
            
            Certification
                by the Principal Executive Officer and Principal Financial Officer
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002
            
            Filed
              herewith99.1
            
            Press
                Release dated May 14, 2008
            
            Filed
              Herewith


31




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.




RADIANT
                LOGISTICS, INC./s/
              Bohn H. CrainDate:
                May 14, 2008
            
            Bohn
                H. Crain
              Chief
                Executive Officer and Chief Financial Officer
              (Principle
                Accounting Officer)


32




**EXHIBIT
      INDEX**




**Exhibit**
              **No.**
            
            **Exhibit**31.1
            
            Certification
                by Principal Executive Officer and Principal Financial Officer pursuant
                to
                Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934,
                as
                amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley
                Act of
                200232.1
            
            Certification
                by Principal Executive Officer/Principal Financial Officer pursuant
                to 18
                U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                Sarbanes-Oxley Act of 200299.1
            
            Press
                Release dated May 14 , 2008





33