U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                 ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                                   FORM 10-KSB

                |X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                              FOR FISCAL YEAR ENDED
                                DECEMBER 31, 2006

                           Commission File No. 0-28223

                    CARGO CONNECTION LOGISTICS HOLDING, INC.

        (Exact name of small business issuer as specified in its charter)


                     Florida                                 65-0510294
        (State or other jurisdiction of                  (I.R.S. Employer
         incorporation or organization)                  Identification No.)

                               600 Bayview Avenue
                             Inwood, New York 11096
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                 (516) 239-7000
                            (ISSUER TELEPHONE NUMBER)


                            (FORMER NAME AND ADDRESS)

SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
                         COMMON STOCK, $0.001 PAR VALUE

INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED
TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING
THE  PRECEDING 12 MONTHS (OR FOR SUCH  SHORTER  PERIOD THAT THE  REGISTRANT  WAS
REQUIRED  TO FILE  SUCH  REPORTS),  AND  (2) HAS  BEEN  SUBJECT  TO SUCH  FILING
REQUIREMENTS FOR THE PAST 90 DAYS.

YES |X| NO |_|

CHECK IF THERE IS NO DISCLOSURE OF DELINQUENT  FILERS IN RESPONSE TO ITEM 405 OF
REGULATION S-B NOT CONTAINED IN THIS FORM, AND NO DISCLOSURE  WILL BE CONTAINED,
TO THE BEST OF THE  REGISTRANT'S  KNOWLEDGE,  IN DEFINITIVE PROXY OR INFORMATION
STATEMENT  INCORPORATED  BY  REFERENCE  IN PART III OF THIS  FORM  10-KSB OR ANY
AMENDMENT TO THIS FORM 10-KSB. |_|

INDICATE BY CHECK MARK WHETHER THE  REGISTRANT  IS A SHELL COMPANY AS DEFINED IN
RULE 12B-2 OF THE EXCHANGE ACT.
YES |_|  NO |X|

REVENUES FOR YEAR ENDED DECEMBER 31, 2006: $17,927,544

                                       1
<PAGE>

AGGREGATE MARKET VALUE OF THE VOTING COMMON STOCK HELD BY  NON-AFFILIATES OF THE
REGISTRANT AS OF March 31, 2007, WAS: $4,466,583

NUMBER OF SHARES OF THE REGISTRANT'S COMMON STOCK OUTSTANDING AS OF MARCH 31,
2007 IS: 1,132,915,616

TRANSFER AGENT AS OF MARCH 31, 2007:

                         FLORIDA ATLANTIC STOCK TRANSFER
                               7130 NOB HILL ROAD
                             TAMARAC, FLORIDA 33321

<PAGE>

Cautionary Statement Regarding Forward Looking Statements:

Certain  statements  contained  in  this  Annual  Report  should  be  considered
"forward-looking  statements"  within  the  meaning  of the  Private  Securities
Litigation  Reform  Act of  1995,  which  reflect  the  current  views  of Cargo
Connection  Logistics  Holdings,  Inc.  ("Cargo  Holdings")  with respect to the
current events and financial  performance.  You can identify these statements by
forward-looking  words such as "may," "will," "expect," "intend,"  "anticipate,"
"believe," " estimates,"  "plan,"  "could,"  "should," and "continue" or similar
words. These  forward-looking  statements may also use different  phrases.  From
time to time, Cargo also provides  forward-looking  statements in other material
Cargo  Holdings  releases  to the public or files with the SEC,  as well as oral
forward-looking  statements.  You should  consult  any  further  disclosures  on
related  subjects in Cargo Holdings' Annual Reports on Form 10-KSB and 10-KSB/A,
Quarterly  Reports of Form 10-QSB and 10-QSB/A  and Current  Reports on Form 8-K
filed with the SEC.

Such  forward-looking  statements  are  and  will  be  subject  to  many  risks,
uncertainties  and factors  which may cause its actual  results to be materially
different from any future results,  express or implied, by such  forward-looking
statements.  Factors that could cause Cargo  Holdings'  actual results to differ
materially from these  forward-looking  statements include,  but are not limited
to, the following:

o     the  ability  to  operate in  compliance  with the terms of its  financing
      facilities (particularly the financial covenants)
o     the ability to maintain  adequate  liquidity and produce  sufficient  cash
      flow to meet Cargo Holdings' capital expenditure plans
o     the ability to attract and retain qualified management and other personnel
o     the number of potential customers in a target market
o     changes in the competitive environment in which Cargo Holdings operates
o     changes  in, or the  failure to comply  with,  government  and  regulatory
      policies
o     the  ability to obtain  regulatory  approvals  and to  maintain  approvals
      previously granted
o     uncertainty  relating to economic conditions generally and in particularly
      affecting the markets in which Cargo Holdings operates
o     changes in our business strategy, development plans or cost savings plans;
o     the ability to complete  acquisitions or divestitures and to integrate any
      business or operation acquired
o     the  ability  to  enter  into   strategic   alliances  or  other  business
      relationships
o     the ability to overcome significant operating losses
o     the  frequency  and  severity of  accidents,  particularly  involving  our
      trucking operations
o     the ability to reduce costs
o     the ability to develop products and services and to penetrate existing and
      new markets
o     technological developments and changes in the industry

Statements  in this Annual  Report and the exhibits to this Annual Report should
be  evaluated  in  light of  these  important  factors.  Cargo  Holdings  is not
obligated   to,  and   undertakes  no  obligation   to,   publicly   update  any
forward-looking  statement due to actual results,  changes in  assumptions,  new
information or as the result of future events.

You should carefully  consider such risks,  uncertainties and other information,
disclosures  and discussions  which contain  cautionary  statements  identifying
important  factors that could cause  actual  results to differ  materially  from
those provided in the forward-looking statements.

                                       3
<PAGE>

                                     PART I

Item 1. - DESCRIPTION OF BUSINESS

Our Business

The Company was incorporated as Meridian Holdings,  Inc. ("Meridian") in Florida
in August 1994 for the purpose of merging,  as the surviving entity, with a then
public "shell" entity, MHI Telecommunications, Inc. ("MHI Telecom"). MHI Telecom
was a Delaware  corporation  that had sold  shares to the public  pursuant  to a
Regulation  A  exemption  from  registration  during  1969  under  its  original
corporate name of Pilgrim Mills, Inc. From 1985 through August 1994, MHI Telecom
had not actively been engaged in any business operations.

On December 3, 1999, Meridian changed its name to Meridian USA Holdings, Inc. On
October 1, 2001, the Company changed its name to ChampionLyte Products, Inc. and
on March 7, 2003, changed its name to Championlyte Holdings, Inc.

In December 2002, a 67% ownership interest in Old Fashioned Syrup Company,  Inc.
("Old Fashioned") was relinquished as part of a foreclosure  action on a $15,000
advance made to the Company in November 2002. As a consequence of losing control
of such business, the Company recorded Old Fashioned as a discontinued business.
In July 2003, the Company entered into a Settlement  Agreement that returned the
67%  ownership  interest in Old  Fashioned  back to the  Company,  which  became
effective August 20, 2003, for $135,000. The acquisition was accounted for under
the purchase method of accounting.

On March 25, 2003,  the Company  created a subsidiary,  Championlyte  Beverages,
Inc., to engage in the  production  and sale of the  Championlyte  products.  On
March 17, 2004, the Company created a subsidiary, Be-Lyte Foods, Inc., to engage
in the production and sale of low carbohydrate snacks.

On May 12, 2005,  Championlyte  Holdings,  Inc. purchased all of the outstanding
shares of Cargo Connection Logistics Corp. and Mid-Coast Management, Inc. (n/k/a
Cargo Connection Logistics - International) for a total of seventy percent (70%)
of the issued and outstanding  shares of common stock of Championlyte  Holdings,
Inc.   pursuant  to  a  Stock  Purchase   Agreement  and  Share  Exchange  among
Championlyte Holdings,  Inc., a Florida corporation,  Cargo Connection Logistics
Corp.,  a Delaware  corporation  and  Mid-Coast  Management,  Inc.,  an Illinois
corporation.  As additional  consideration,  Championlyte Holdings,  Inc. issued
shares of preferred  stock to Cargo  Connection  Logistics  Corp.  and Mid-Coast
Management,  Inc.,  which are convertible  into common stock of Cargo Connection
Logistics  Holding,  Inc.  twelve  (12)  months  from the  closing  date of this
transaction so that Cargo Connection  Logistics Corp. and Mid-Coast  Management,
Inc.  own  eighty  percent  (80%)  of the  outstanding  shares  of  Championlyte
Holdings, Inc. at such twelve month period.

On May  23,  2005,  Championlyte  Holdings,  Inc.  changed  its  name  to  Cargo
Connection Logistics Holding, Inc.

In December 2006, the Company acquired Nuclear Material Detection  Technologies,
Inc.  ("NMDT"),  a  wholly-owned  subsidiary of UTEK  Corporation  in a tax-free
stock-for-stock  exchange  valued  at  $1,516,854.  NMDT  holds a  license  to a
patented  portable nuclear  material  detecting  technology.  The Company issued
168,539,326  shares of the Company's  common stock at a market price of $.009 in
this transaction.

Product Overview

On May 12, 2005, Cargo Connection  Logistics Holding,  Inc. (f/k/a  Championlyte
Holdings,  Inc.) began operating in the transportation and logistics industry as
a third party  logistics  provider of  transportation  and management  services,
primarily through its  subsidiaries,  Cargo Connection  Logistics Corp.  ("Cargo
Connection")  and  Cargo  Connection  Logistics  -  International,  Inc.  (f/k/a
Mid-Coast Management,  Inc.) ("Cargo International").  The Company's target base
ranges from mid-sized to Fortune 100(TM) companies. This is accomplished through
its network of terminals and  transportation  services.  Effective May 23, 2005,
the name Championlyte  Holdings,  Inc. was changed to Cargo Connection Logistics
Holding,  Inc. (the "Company") to better reflect the new nature and focus of the
entity and its operations.  Cargo Connection Logistics Holding,  Inc. and all of
its subsidiaries are collectively referred to as the "Company."

                                       4
<PAGE>

The Company is a provider of logistics solutions for global partners through its
network of branch locations and independent agents in North America. It operates
predominately  as a  non-asset  based  transportation  provider  which  provides
truckload and  less-than-truckload  (LTL) transportation services utilizing some
Company equipment,  dedicated owner operators and through our relationships with
transportation  companies.  We select and hire the  transportation  services  to
manage  our  customers'  needs  through  approved  contract  carriers.   A  core
competency is  specializing  in  time-definite  transportation  which offers our
customers  expedited,  dedicated  and  exclusive  use  vehicles.  Exclusive  use
services  require  pinpoint and time sensitive  coordination for those customers
that require it. Our  management  estimates the  expedited  market in the United
States will be in excess of 2 billion dollars per year, growing as manufacturers
shift even more to just-in-time inventories and leaner supply chains. We believe
our  footprint  within  the  expedited  transportation  services  niche  and our
complete  understanding of the supply chain will give us opportunities to expand
at a substantial rate for the foreseeable future.

The Company also provides a wide range of value-added  logistics  services which
include U.S.  Customs Bonded  warehouse  facilities,  container  freight station
operations,  and a General Order ("G.O.") warehouse operation which began in the
latter part of the second  quarter of 2006, all of which enhance and support our
customer's  supply chain  logistics  needs.  Some of the  services  provided are
pick-and-pack  services,  special  projects that may include  changing labels or
tickets on items,  the inspection of goods into the United States and storage of
goods.

Cargo Connection is a Domestic  transportation  partner for those  International
companies who require assistance throughout the United States. In addition,  the
transportation  network  that is  currently  in place allows for the movement of
goods  throughout  the  United  States,  Canada  and  Mexico  on  behalf  of its
customers.  It has the  facilities  to assist  companies  with their  freight by
either  holding  the freight in their  bonded  facilities  or  possibly  sorting
freight  for the client  while the goods are  clearing  customs  in its  Customs
approved Container Freight Stations. As of June, 2006, Cargo Connection has been
granted  the  designation  of a General  Order  warehouse  at JFK  international
airport to add to its list of services.  In addition,  Cargo Connection operates
line-haul   service   throughout   the   United   States.   It  runs   scheduled
less-than-truckload service up and down the east coast and into the mid-west. It
also offers  truck-load  and  exclusive  use vehicle  service to anywhere in the
United States. In June, 2006, the Company expanded its local pickup and delivery
service around New York's JFK International Airport.

Last year Cargo Connection  became part of an exclusive number of companies that
work closely  with the  Department  of Homeland  Security and Customs and Border
Patrol ("CBP").  The company has always worked closely with these two government
agencies  but  this  year  expanded  into a new  operational  capacity  for  the
government  through  our  ability  to become a  General  Order  Warehouse.  This
approval was based on our ability to provide accurate electronic information for
the  government  and last year Cargo  Connection  became the sole General  Order
Warehouse at JFK International Airport. General Order warehouses operate under a
specific Code of Federal Regulations which requires merchandise to be considered
general  order  merchandise  either when it is taken into the custody by CBP (i)
whenever entry of any imported  merchandise is not made within the time provided
by law or regulations prescribed by the Secretary of the Treasury; (ii) whenever
entry is incomplete because of failure to pay estimated duties;  (iii) whenever,
in the  opinion of the port  director,  entry  cannot be made for want of proper
documents or other causes;  (iv)  whenever the port  director  believes that any
merchandise  is not  correctly  or legally  invoiced;  or (v)  whenever,  at the
request  of the  consignee  or the owner or  master  of the  vessel or person in
charge of the vehicle in which merchandise is imported, any merchandise is taken
possession of by the port director  after the expiration of 1 day after entry of
the vessel or report of the  vehicle.  While at either at bonded  warehouse or a
G.O.  Warehouse the  merchandise  may be entered into the United States commerce
after the full payment of the Customs duties,  fees and taxes and proof that all
associated  liens have been satisfied for the Air or Ocean Carrier,  the cartage
agent and the storage charges at the Bonded Warehouse or the G.O. Warehouse.

                                       5
<PAGE>

As the  government  is forced to tighten  regulations  for the  security  of the
nation we expect that the current  timelines  will be shortened.  With the world
focused on an evolutional  supply chain any freight that is not entered into the
United  States  Customs  system  should  become  suspect  and as such  should be
isolated and  inspected.  This will give the government  more  visibility to not
only  security  threats but  fraudulent  threats to commerce  that include trade
infringements, counterfeit trade.

In addition to the expedited business that we are currently in, Cargo Connection
in 2007 will be looking to extend  its  operating  authority  and  insurance  to
smaller  companies  that have their own  customers  along with their own base of
operations.  This sector of the  business is referred to within the  industry as
"agents."  Agents  typically  have an office from which they operate and control
between  two  million  and  five  million  dollars  worth  of  business.   Cargo
Connection,  through its systems,  would  provide  these agents with  insurance,
authority  and back  office  functionality  to assist  them in  operating  their
business.  Typically, an agent will pay the company between 15 and 21 percent of
the gross revenue  depending  upon the particular  customer  base,  their credit
worthiness  and the support  that the  customers  will require from the company.
This portion of the business  generally  will add trucks to our fleet.  However,
these trucks must meet all of the standards that the company uses as a benchmark
from its safety  department.  We would  expect the revenue from each agent to be
between 5 and 7 percent net revenue to the company.  We  anticipate  that we can
implement  this  without a need for  capital  infusion  and  utilize the current
resources that are in place to implement this business.

To better align the business  operations  of the Company and to continue to gain
brand  name  recognition,  management  had  changed  the  name of its  Mid-Coast
Management,  Inc.  subsidiary,  effective  March 14, 2006,  to Cargo  Connection
Logistics - International, Inc. ("Cargo International"). Cargo International has
become the international division of the Company. It will seek out opportunities
abroad, cultivate those opportunities and turn them into revenue streams through
the  implementation  of our services  that can be offered  within the  logistics
industry either by the Company  directly or through joint venture  partnerships.
The Company has explored the  potential  for the Company to open offices and add
personnel and establish a foothold in countries outside of the United States.

Cargo  Connection  and  Cargo   International  each  provide  a  wide  range  of
value-added  logistics  services  which include U.S.  Customs  Bonded  warehouse
facilities and container freight station  operations.  The services provided are
specifically  designed  to enhance and to support the  customer's  supply  chain
logistics needs through operational excellence and value-added services. This is
accomplished  through  innovative  solutions  taking into  account the  specific
diversified markets of our customers.  Some of the value-added  services that we
provide are pick and pack services,  special projects that will include changing
labels or tickets  on items,  inspection  of goods  into the  United  States and
recovery of goods damaged in transit. Our variable cost business model allows us
to be flexible and adapt to changing economic and industry  conditions.  We also
keep our  personnel  and other  operating  expenses as variable as possible.  We
believe that our decentralized  branch network is a major competitive  advantage
which allows our customers to better use  available  capacity from Ocean and Air
Carriers.  Our  network of offices  located in  Atlanta,  GA;  Bensenville,  IL;
Charlotte,  NC; Columbus,  OH; Inwood,  NY; Miami, FL;  Pittsburgh,  PA; and San
Jose, CA support our core strategy of serving customers locally,  nationally and
globally.  The  services  provided are  specifically  designed to enhance and to
support  the  customer's  supply  chain  logistics  needs  through   operational
excellence and value-added  services.  This is accomplished  through  innovative
solutions taking into account the specific diversified markets of our customers.
This  is  very  important  facet  in  logistics  because  it is so  dynamic  and
market-driven based upon available capacity.

                                       6
<PAGE>

As this past year came to a close,  the Company acquired a new subsidiary at the
end of 2006. The subsidiary,  known as Nuclear Material Detection  Technologies,
Inc.  ("NMDT"),  is an organization  whose primary  business  application is the
detection  of  radiation  in the  logistics,  transportation  and general  cargo
industry.  The Company feels that the current  security  environment  within the
transportation  industry  makes  NMDT not just a  complementary  portion  of the
business,  but one that in the near  future  may  become a  requirement  for the
transportation industry. Improving security at U.S. Ports is one of the nation's
most  difficult  challenges  since the systems used to screen cargo must work in
concert  with  ongoing  seaport  activities.  Using the  product  that NMDT will
license or  produce,  called  RadRope(TM),  inspectors  can  rapidly  detect the
presence of nuclear  material in a sealed  container  without the use of harmful
x-rays.

NMDT's  operations  will run  independently  from the other  subsidiaries of the
Company and its product(s) can be sold to private industry and well as different
divisions of the United States Government and foreign  governments that have the
need or the desire to instill the same security ethics as the United States. The
applications  of this  technology  are  flexible  in that they can be applied to
fixed installations or completely transportable portable devices.

The Company has continued to look in other areas that will  complement the needs
of the industry, either by adding additional services,  helping to form entities
that have specific  attributes or through  acquisitions.  One of these  entities
that we have partnered in is Independent  Transportation Group ("ITG"). ITG is a
joint  venture  entity in which  the  Company  owns a 51%  majority  share.  The
remaining  49% rests with  emplifyHR,  who manages the venture.  The goal of the
entity is that ITG has the ability to attract independent  contractors and other
carriers  to perform  work on behalf of Cargo  Connection  Logistics  Corp.  The
primary goal is to assist the Company  through  increasing the size and scope of
its driver  fleet,  while  offering  agents  comprehensive  packages for medical
insurance,  profit  sharing  plans,  as well as other benefits for themselves as
well as their driver pool.

                                  RISK FACTORS

We have a limited public operating  history with  significant  losses and expect
losses to  continue  for the  foreseeable  future.  Should we  continue to incur
losses for a  significant  amount of time,  the value of your  investment in our
common  stock could be  adversely  affected  and you could even lose your entire
investment.

We have yet to establish any public history of profitable operations as shown in
our independent  certified financial audit for 2006 and 2005. As of December 31,
2006, we had an accumulated  deficit of $14,099,352.  We have incurred an annual
operating loss of $2,316,351 for the year ended December 31, 2006 and $3,703,674
for the year ended  December 31, 2005.  As of December 31, 2006,  we had a total
shareholder deficit of $8,521,880. We have financed our operations through loans
from our officers,  employees, and outside investors,  sales of our common stock
in a  private  placement  and by the  corporation  selling  stock to  investors.
Although  our  revenues  have  increased,  these  revenues  have  not  yet  been
sufficient to sustain our operations.  We will require  additional  financing to
sustain our operations, without which we may not be able to continue operations.
In addition,  the terms of the secured convertible  debentures issued to certain
selling  stockholders  require  that we  obtain  the  consent  of  such  selling
stockholders prior to our entering into subsequent  financing  arrangements.  No
assurance can be given that we will be able to obtain additional  financing,  on
terms that are  favorable  to us or that the holders of the  secured  debentures
will  provide  their  consent  to permit us to enter into  subsequent  financing
arrangements. This can lead to the reduction or suspension of our operations and
ultimately  our going out of  business.  Should  this  occur,  the value of your
investment in the common stock could be adversely affected.

                                       7
<PAGE>

We will need to raise additional  funds through the public market,  private debt
or private sales of equity to achieve our current business strategy. Our need to
raise  additional  funds in the future  will  likely  involve  the  issuance  of
additional  shares of stock,  which could  dilute the value of your  investment.
There is no assurance,  however, that we will be able to raise additional monies
in the future.

Our  inability  to raise  additional  working  capital or to raise the  required
financing  in a timely  manner would  negatively  impact our ability to fund our
operations,  our  ability to  generate  revenues  and to  otherwise  execute our
business  plan.  Should this occur,  the value of your  investment in the common
stock could be adversely affected.  Therefore, you may be investing in a company
that will not have the funds necessary to continue operations.  Our inability to
obtain  financing  would  have a  material  adverse  effect  on our  ability  to
implement  our  development  strategy,  and as a  result,  could  require  us to
diminish or suspend our development  strategy and possibly cease our operations.
We have issued secured  convertible  debentures that may restrict our ability to
obtain additional financing.

We have issued a two-year  secured  debenture in 2005 that is  convertible  into
shares of our common stock to Montgomery  Equity  Partners,  LP, an affiliate of
Cornell Capital Partners, LP. Under the terms of the secured debentures,  we are
restricted in our ability to issue additional  securities as long as any portion
of the  principal  or interest on the secured  debentures  remains  outstanding.
Specifically,  we may not,  without  the prior  consent  of the  holders  of the
secured  debentures,  issue any common  stock at a discount  to its fair  market
value or issue any derivative security, such as warrants or options, convertible
into common stock at less than fair market value.  We are also  precluded  under
the terms of the secured  debentures  from  granting  any third party a security
interest in our assets.  Our inability,  without the secured debenture  holders'
consent,  to  provide a discount  on our stock or to grant a  security  interest
could make it difficult to find parties willing to make  additional  investments
in us or to loan us money and therefore  could  adversely  affect our ability to
raise additional funds.

The sale of common stock by  investors  after  delivery of a  conversion  notice
could have a depressive effect on the price of our common stock. In addition, we
do not intend to  disclose  the timing of any  conversion  notices  which we may
receive from the investors  and as a result,  you will have no knowledge of when
the investors are converting into shares of common stock.

The secured  convertible  debentures are  convertible  into shares of our common
stock at a  conversion  price  equal to the  lesser of (i) 120%  percent  of our
market price at the time that our stock is first  approved for  quotation on the
OTC  Bulletin  Board or (ii) at a 20%  discount  to the  evaluated  price of the
common  stock  prior to the  conversion.  The  method  used to price the  shares
convertible under the secured debentures may be selected by Montgomery Partners,
LP. While the term sheets related to the  Securities  Purchase  Agreements  with
Montgomery  Equity  Partners,  LP,  contained  provisions  prohibiting them from
engaging in short sales, the investors may, nevertheless,  engage in the sale of
escrowed  shares after  delivering a conversion  notice to us but before  actual
delivery of the shares.  In the event that  Montgomery was to engage in any such
sales,  this may create  downward  pressure on the price of our common stock and
could result in higher levels of volatility.  Further,  any resulting decline in
the price of our stock will result in increased dilution due to the fact that we
would be  required to issue  greater  numbers of shares  upon  receiving  future
conversion  notices.  In  addition,  not  only the sale of  shares  issued  upon
conversion of secured debentures,  but also the mere perception that these sales
could  occur,  may  adversely  affect the market price of the common  stock.  In
addition, we do not intend to disclose the timing of conversion notices which we
may receive from Montgomery. As a result, you will have no knowledge of when the
investors are  converting.  Further,  you will not know that the investors  have
shares of our common  stock  that they may be  imminently  selling,  or that the
investors  have sold such shares,  all of which may have a depressive  effect on
the price of our common stock.

                                       8
<PAGE>

The  issuance  of shares of our common  stock  upon  conversion  of the  secured
convertible  debentures may result in  substantial  dilution to the interests of
other  stockholders  since the selling  stockholders may ultimately  convert and
sell the full  amount  issuable  on  conversion.  There is no upper limit on the
number  of shares  that may be issued  which  will  have the  effect of  further
diluting the  proportionate  equity  interest and voting power of holders of our
common stock, including investors in this offering.

If we are required for any reason to repay our outstanding  secured  convertible
debentures,  we may be required to deplete our working capital, if available, or
raise additional funds. Our failure to repay the secured convertible  debenture,
if required,  could result in legal action  against us, which could  require the
sale of substantially all of our assets.

Any  event  of  default  in our  obligations  to  the  holders  of  the  secured
convertible  debentures,  such as our failure to pay the  principal and interest
when due, our failure to issue shares of common stock upon the conversion by the
holder,  our  failure  to  timely  file a  registration  statement  or have such
registration   statement   declared   effective,   breach   of   any   covenant,
representation  or  warranty  in the  securities  purchase  agreements  for such
secured  convertible  debentures or in the secured convertible  debentures,  the
commencement  of  a  bankruptcy,   insolvency,   reorganization  or  liquidation
proceeding  against us and the  delisting of our common stock could  require the
early  repayment  of the secured  convertible  debentures  if the default is not
cured with the specified grace period. We anticipate that the full amount of the
secured  convertible  debentures,   together  with  accrued  interest,  will  be
converted into shares of our common stock,  in accordance  with the terms of the
secured  convertible  debentures.  If we were  required  to  repay  the  secured
convertible debentures,  we would be required to use our limited working capital
and raise  additional  funds. If we were unable to repay the secured  debentures
when required,  the debenture holders could commence legal action against us and
foreclose on all of our assets to recover the amounts due. Any such action would
require us to curtail or cease operations.

Our security  agreements with Montgomery  Equity  Partners,  LP contain negative
covenants  which  restrict  our  ability to create  security  interests,  change
management,  declare  dividends,  make loans and incur additional  indebtedness,
without Montgomery's prior written consent.

In  connection  with  the  securities   purchase   agreements  for  our  secured
convertible  debentures with Montgomery Equity Partners,  LP (effective December
29,  2005),  the Company  granted  Montgomery  a secured  interest in all of our
assets.  In accordance with such  agreement,  we may not,  without  Montgomery's
written consent, directly or indirectly:

                                       9
<PAGE>

o     permit to exist  any  assignment,  transfer,  pledge,  mortgage,  security
      interest  or  other  lien or  encumbrance  in or  against  any part of the
      pledged property;
o     materially change our ownership, executive staff or management;
o     declare or pay any dividend of any kind,  in cash or in  property,  on any
      class  of our  capital  stock,  or make  any  distribution  of any kind in
      respect thereof;

These  restrictions  could  impede our ability to obtain  additional  funding to
finance  our  ongoing  operations,  which  would have a  negative  impact on our
business and the value of your investment.

The Company's  inability to retain its key executive  officers  would impede our
business plan and growth  strategies,  which could have a negative impact on our
business and the value of your investment.

Our success depends, to a critical extent, on the continued efforts and services
of our Chairman of the Board and Chief Executive Officer,  Jesse Dobrinsky;  our
Chief Operating  Officer and Chief Financial  Officer,  Scott Goodman;  our Vice
President  and Head of New  Business  Development,  John L. Udell;  and our Vice
President of Sales and Marketing,  William F. O'Connell.  Were we to lose one or
more of these key executive  officers,  we would be forced to expend significant
time and money in the pursuit of a  replacement,  which  would  result in both a
delay in the  implementation  of our business plan and also the diversion of our
limited  working  capital.  There is no assurance that we can find  satisfactory
replacements  for these key executive  officers at all, or on terms that are not
unduly expensive or burdensome to our Company.

Competition

Our  competition is from companies that move expedited  airfreight and cargo. We
are working on  negotiating  joint  ventures that could provide the Company with
additional licenses to provide us with the capabilities to provide our customers
with a full  service  solution to their  supply  chain  needs.  While we compete
directly with our  competitors on Expedited  L-T-L service which we provide from
our facilities that go airport to airport,  we also use many outside vendors and
independent  contractors  to control the number of assets the  company  needs to
maintain.

In addition,  our warehouse  operations have integration into our transportation
system  which  allows  complete  tracking of cargo from  arrival into the United
States through the United States Customs clearance  process.  Once the cargo has
cleared  customs the  directions  for  distribution  can be sent via any mode of
communications  (EDI, E-Mail,  Fax or Voice).  These services may be provided by
Cargo Connection or a third party that the customer has chosen.  The integration
of the  transportation and warehouse systems provide our customers with complete
visibility to their goods through the entire import process.

Once we begin our overseas operations, which we expect to start during 2007, the
visibility  of freight  will begin  once the goods  exit the  overseas  factory,
assuming the customer will provide us with  visibility to that  information.  We
could provide these services today through the world-wide web.

Reliance on Independent Agents

The Company  presently  relies in small part upon the  services  of  independent
agents to market  its  transportation  services  in areas it does not  currently
operate,  to act as  intermediaries  with  customers and to provide  services on
behalf of the Company.  Although the Company believes its relationship  with its
agents is satisfactory, there can be no assurance that the Company will continue
to be  successful  in retaining  its agents or that agents who  terminate  their
contracts  can be replaced by other  equally  qualified  companies.  Because the
agents occasionally have the primary relationship with customers, some customers
could  be  expected  to  terminate  their  relationship  with the  Company  if a
particular agent were to terminate his or her relationship with the Company.

                                       10
<PAGE>

Characteristics of the Logistics Industry

As a participant in the logistics services  industry,  the Company's business is
dependent upon a number of factors  including the availability of transportation
equipment and warehousing and distribution  facilities at  cost-effective  rates
and on reasonable  terms and conditions.  Such services and facilities are often
provided by independent third parties.  Shortages of cargo space are most likely
to develop in and around the  holiday  season as well as in those  exceptionally
heavy transportation lanes. Shortages in available space could also be triggered
by economic  conditions,  transportation  strikes,  regulatory changes and other
factors beyond the control of the Company.  The future operating  results of the
Company  could be  materially  adversely  affected by  significant  shortages of
suitable cargo space and  associated  increases in rates charged by providers of
such cargo space. In addition,  if the Company were unable to secure  sufficient
equipment   or   attract   and  retain   sufficient   personnel,   drivers   and
owner-operators  to meet the needs of its  customers,  its results of operations
could be materially adversely affected. Finally, the Company's operating results
would be  materially  adversely  affected if the Company's  production  would be
limited to  transportation-based  services which are typically  lower margin and
subject to greater competitive pressures than logistic services.

Vulnerability to Economic Conditions

The  Company's  future  operating  results  may be  dependent  on  the  economic
environments  in which it operates.  Demand for the Company's  services could be
materially  adversely  affected by economic  conditions in the industries of the
Company's customers. Interest rate fluctuations,  economic recession, customer's
business cycles,  availability of qualified drivers,  changes in fuel prices and
supply,  increases in fuel or energy taxes and the transportation costs of third
party carriers are all economic  factors over which the Company has little or no
control. Increased operating expenses incurred by transportation carriers can be
expected to result in higher  transportation  costs, and the Company's operating
margins  would be materially  adversely  affected if it were unable to pass them
through to its  customers  the full amount of  increased  transportation  costs.
Economic recession or a downturn in customers' business cycles,  particularly in
industries in which the Company has a large number of customers, could also have
a material  adverse  effect on the  Company's  operating  results due to reduced
volume of loads  shipped.  The Company  expects  that  demand for the  Company's
services  (and,  consequently,  its results of  operations)  will continue to be
sensitive to domestic economic conditions and other factors beyond its control.

Government Regulation

The  Company's  operations  are  subject to various  state,  local,  federal and
foreign  regulations  that in many instances  require  permits and licenses.  In
1996,  responsibility  for  oversight  of motor  carriers,  brokers  and freight
forwarders was assumed by the Surface  Transportation  Board (the "STB") and the
Federal  Highway  Administration  (the  "FHWA")  both of  which  are part of the
Department of Transportation (the "DOT"). The FHWA prescribes qualifications for
acting in this capacity,  including  certain surety  bonding  requirements.  The
Company's motor carrier operations are subject to safety regulations of the FHWA
related to such matters as hours of service by drivers, equipment inspection and
equipment maintenance. The Company is also a common carrier and a contract motor
carrier regulated by the STB and various state agencies.  The Company is subject
to various U.S. environmental laws.

                                       11
<PAGE>

Any violation of the laws and regulations  discussed above could increase claims
and/or liability,  including claims for uninsured  punitive damages.  Violations
also could subject the Company to fines or, in the event of a serious violation,
suspension,  revocation  or operating  authority or criminal  penalties.  All of
these regulatory  authorities have broad powers generally  governing  activities
such as authority to engage in motor carrier operations,  rates and charges, and
certain mergers, consolidations and acquisitions. Although compliance with these
regulations has not had a material adverse effect on the Company's operations or
financial condition in the past, there can be no assurance that such regulations
or changes thereto will not materially adversely impact the Company's operations
in the future.

Certain federal officials have announced that they are considering  implementing
increased  security measures with respect to cargo. There can be no assurance as
to what, if any, regulations will be adopted or what, if adopted, their ultimate
effect on the  Company  will be.  Failure of the  Company to  maintain  required
permits or licenses, or to comply with applicable  regulations,  could result in
substantial fines or revocation of the Company's operating authorities.

Pick-Up and Delivery Claims Exposure

The  Company  utilizes  the  services  of a  significant  number of  drivers  in
connection   with  its  local  pick-up  and  delivery   operations  as  well  as
over-the-road  transportation needs. From time to time such drivers are involved
in accidents. Although most of these drivers are independent contractors,  there
can be no assurance  that the Company will not be held liable for the actions of
such  drivers.  The  Company  currently  carries,  or requires  its  independent
owner-operators to carry,  liability insurance in varying amounts,  depending on
the State and which  operations  are being  conducted,  for each such  accident.
However,  there can be no  assurance  that claims  against the Company  will not
exceed the amount of  coverage.  If the Company  were to  experience  a material
increase in the frequency or severity of accidents, liability claims or workers'
compensation  claims,  or  unfavorable  resolutions  of  claims,  the  Company's
operating  results  and  financial  condition  could  be  materially   adversely
affected. In addition, significant increases in insurance costs could reduce the
Company's profitability.

Employees

As of December 31, 2006 we employed a core group of  approximately  115 persons,
including executive officers, managers, supervisors, drivers, warehouse workers,
sales and clerical personnel. We will employ additional people as we continue to
implement  our  plan  of  operation.  None of our  employees  are  covered  by a
collective  bargaining  agreement and we believe that our relationship  with our
employees is satisfactory.


Item 2. - DESCRIPTION OF PROPERTY

We currently lease and/or utilize the following properties:

o     Inwood, New York (Corporate)
      o     80,000  Total  Square Feet of which  18,400 sq. ft. is utilized  for
            office space and the remainder is warehouse.

o     Atlanta, Georgia
      o     27,520  Total  Square Feet of which  4,120 sq. ft. is  utilized  for
            office space and the remainder is warehouse.

o     Bensenville, Illinois
      o     92,000  Total  Square Feet of which  20,000 sq. ft. is utilized  for
            office space and the remainder is warehouse

o     Columbus, Ohio
      o     52,000  Total  Square Feet of which  7,360 sq. ft. is  utilized  for
            office space and the remainder is warehouse.

o     Miami, Florida
      o     36,480  Total  Square Feet of which  5,470 sq. ft. is  utilized  for
            office space and the remainder is warehouse.

o     Pittsburgh, Pennsylvania
      o     7,500 Total Square Feet in our Agent's facility

o     Charlotte, North Carolina
      o     60,000 Total Square Feet in our Agent's facility

o     San Jose, California
      o     20,000 Total Square Feet in our Agent's facility

The Company  considers its  facilities to be sufficient for our present uses and
our  anticipated  future  operations.  We also  believe  that  the  above  noted
properties  are  adequately  covered  by  insurance  and  are in  good  physical
condition.

Item 3. - LEGAL PROCEEDINGS

On or about  November 17, 2006,  Daniel Murray  ("Murray"),  a former  employee,
filed a  Complaint  against  the  Company  asking for  damages  for  alleged age
discrimination,  fraudulent  inducement,  breach of contract  and other forms of
discrimination under Daniel Murray v. Cargo Connection Logistics Holding,  Inc.,
case No. 19405-06 (Supreme Court of the State of New York,  Nassau County,  NY).
Murray seeks  damages  equal to the annual  salary  contained in the  employment
agreement of $150,000 per year for five years or $750,000. The Company has since
filed a Motion to Dismiss all causes of action other than the breach of contract
claim. This motion was fully submitted on February 15, 2007. Management believes
that the  Company  has  meritorious  defenses  to this  claim and is  vigorously
contesting the case.

On or about  November 10, 2006,  One Rason Road Joint  Venture,  Inc.  ("Rason")
filed a complaint  against Cargo Connection  Logistics Corp.  seeking damages in
the amount of $282,672 for alleged lease  payments for a non-owned,  non-related
or non-affiliated  company,  Airfreight Management Group, Inc. in One Rason Road
Joint  Venture v.  Airfreight  Management  Group,  Inc.  n/k/a Cargo  Connection
Logistics  Corporation,  case 06-017600 (Supreme Court of the State of New York,
County of Nassau,  NY). Rason filed the action for breach of a lease, dated July
10,  2003  between  itself  and a company  called  Airfreight  Management  Group
("AMG"),  Inc. for  premises  located at 45 Rason Road,  Inwood,  NY which lease
expires on July 31, 2008. Rason alleges that AMG vacated the premise on or about
May, 2006 and owes back rent.  Rason also alleges that AMG in now known as Cargo
Connection Logistics  Corporation and feels that the Company is liable for AMG's
debts  under the lease.  The Company has filed a Notice of Motion to dismiss the
Complaint  and is awaiting  opposition  papers from Rason.  The motion was to be
fully  submitted  on March 9, 2007.  Management  believes  that the  Company has
meritorious defenses to this claim and is vigorously contesting this matter.

On or about November 6, 2006, in an  application to the Bankruptcy  Court for an
Examination  of  Airfreight  Warehouse  Corporation  ("AFW"),  which  filed  for
Bankruptcy under Chapter XI in the US Bankruptcy Court for the Southern District
of New York,  alleges that pursuant to an agreement entered into between AFW and
the Cargo  Connection  Logistics  Corp.  ("Cargo"),  that Cargo has not paid all
funds due to AFW under the agreement in the amount of $300,000.  Management  has
complied with the request of the Trustee of the US Bankruptcy Court and believes
that the Company has acted in good faith and remitted all funds due to AFW under
the agreement.

On or about May,  2006,  the Company filed suit against a former  business agent
under Cargo  Connection  Logistics  Corp. v. Fleet Global  Services,  Inc., case
number  48-2006-CA-3208-0  (9th Judicial  Circuit,  Orange County,  Florida) for
breach of contract in the amount  $128,179.  The trial date is presently set for
May 8, 2007.

The Company is party to other various legal proceedings  generally incidental to
its business as is the case with other companies in the same industry.  Although
the  ultimate   disposition  of  legal  proceedings  cannot  be  predicted  with
certainty,  it is the opinion of management  that the outcome of any claim which
is pending or threatened,  either  individually or on a combined basis, will not
have a materially adverse effect on the consolidated financial statements of the
Companies.


Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

                                       12
<PAGE>

                                     PART II


Item 5. - MARKET PRICE OF AND  DIVIDENDS ON THE  REGISTRANT'S  COMMON EQUITY AND
OTHER STOCKHOLDER MATTERS

As of March 31, 2007, our Transfer  Agent's records  indicate that there were
466 shareholders of record of our common stock owning 1,132,915,616 shares.

Our common stock trades on The National Association of Securities Dealers,  Inc.
Electronic  Bulletin  Board  (the "OTC  Bulletin  Board").  On May 26,  2005 the
Company changed its name to Cargo  Connection  Logistics  Holding,  Inc. and our
ticker symbol was changed from "CPLY" to "CRGO".  The following table represents
the closing  high and low bid  information  for our common stock during the last
two fiscal years as reported by the OTC Bulletin Board.  The quotations  reflect
inter-dealer prices, without retail mark-up, mark-down or commission and may not
represent actual transactions. The market for our common stock is sporadic.

================================================================================
      2006                             High                        Low
--------------------------------------------------------------------------------

  First Quarter                       $.017                      $.002

 Second Quarter                       $.020                      $.009

  Third Quarter                       $.027                      $.011

 Fourth Quarter                       $.013                      $.006

================================================================================
      2005                            High                        Low
--------------------------------------------------------------------------------

  First Quarter                       $.057                      $.021

Second Quarter(1)                     $.035                      $.013

  Third Quarter                       $.026                      $.004

 Fourth Quarter                       $.011                      $.002

--------

1)    On May 12, 2005, pursuant to a Stock Purchase Agreement and Share Exchange
      among  Cargo  Connection   Logistics  Holding,   Inc.  f/k/a  Championlyte
      Holdings, Inc., a Florida corporation, Cargo Connection Logistics Corp., a
      Delaware corporation and Cargo Connection Logistics - International,  Inc.
      (f/k/a  Mid-Coast  Management,  Inc.),  an  Illinois  corporation,   Cargo
      Connection Logistics Holding, Inc. purchased all of the outstanding shares
      of Cargo Connection Logistics Corp. and Mid-Coast  Management,  Inc. for a
      total of seventy  percent  (70%) of the issued and  outstanding  shares of
      common stock of Cargo Connection Logistics Holding, Inc.


Dividend Policy

No dividends have ever been declared by the Board of Directors of Cargo Holdings
on its common  stock.  At the present time Cargo  Holdings  does not  anticipate
paying  dividends,  cash or otherwise,  on it's common stock in the  foreseeable
future. Future dividends will depend on earnings, if any, of Cargo Holdings, its
financial requirements and other factors.

                                       13
<PAGE>

Stock Option Grants In The Past Fiscal Year

- None -


DESCRIPTION OF CAPITAL STOCK

Common Stock

The Company is authorized to issue 5,000,000,000  shares of common stock, $0.001
par value per share, of which  1,132,915,616  shares of common stock were issued
and  outstanding  at March 31, 2007.  All shares have equal voting rights and
are not assessable. Upon liquidation, dissolution, or winding up of the Company,
the assets of the Company, after the payment of liabilities, will be distributed
pro rata to the holders of the common stock.  The holders of the common stock do
not have  preemptive  rights to subscribe for any  securities of the Company and
have no right to require the Company to redeem or purchase their shares.

Preferred Stock

The Company is authorized to issue 2,000,000 share of preferred stock, $1.00 par
value per share,  and currently  has  designated  the  preferred  stock into the
following Series:

o     Series III: The Company amended its articles of  incorporation in November
      2006 and  authorized  500,000  shares of Blank Check Series III  Preferred
      Stock ("Series III") at $1.00 par value. The shares of Preferred Stock may
      be issued in one or more series, and each series shall be so designated as
      to distinguish  the shares from the shares of all other series.  The Board
      of Directors have the authority to fix the provisions  before the issuance
      of any shares of a particular  series as to the number,  designation,  and
      relative rights,  preferences and limitations of the shares of such series
      including (1) voting  rights,  if any, which may include the right to vote
      together as a single  class with the Common  Stock and any other series of
      the Preferred  Stock with the number of votes per share accorded to shares
      of such series being the same as or different  from that  accorded to such
      other shares,  (2) the dividend rate per annum,  if any, and the terms and
      conditions  pertaining  to dividends and whether such  dividends  shall be
      cumulative,  (3) the  amount or amounts  payable  upon such  voluntary  or
      involuntary  liquidation,  (4) the redemption price or prices, if any, and
      the terms and conditions of the redemption,  (5) sinking fund  provisions,
      if any for the  redemption  or purchase of such shares,  (6) the terms and
      conditions on which such shares are  convertible,  in the event the shares
      are to have conversion rights,  and (7) any other rights,  preferences and
      limitations   pertaining  to  such  series  which  may  be  fixed  by  the
      Corporation's   Board  of  Directors  pursuant  to  the  Florida  Business
      Corporation Act.

            o     The Company is authorized  to issue  500,000  shares of Series
                  III  preferred  stock,  $1.00 par value  per  share,  of which
                  265,000  shares are issued and  outstanding  at  December  31,
                  2006.


o     Series IV: The Company amended its articles of incorporation in September,
      2003 and  January,  2006 and  increased  to  600,000  shares its Series IV
      convertible Preferred Stock ("Series IV"), $1.00 par value. The shares are
      based  on  a  convertible   promissory   note  entered  into  between  the
      Corporation and Triple Crown Consulting,  Inc. Each share of the Series IV
      preferred stock is convertible  into shares of the Company's common stock.
      Each holder of the Series IV preferred  stock has twenty times that number
      of votes on all matters  submitted  to  shareholders  that is equal to the
      number of shares of common stock into which such holder's shares of Series
      IV preferred stock are then convertible.  In addition,  the holders of the
      Series IV  preferred  stock are  entitled  to receive  noncumulative  cash
      dividends  at an  annual  dividend  rate as  determined  by the  Board  of
      Directors.  The Series IV preferred stock has a liquidation price of $1.00
      per share in the event of any  liquidation,  dissolution  or winding up of
      the Company,  whether voluntary or involuntary.  The Company's articles of
      incorporation  state  that,  at the  option of the  Holder,  the Series IV
      preferred stock will be convertible  into the Company's  common stock at a
      conversion  price  equal to the lesser of (i) the average of the lowest of
      three-day trading prices during the five trading days immediately prior to
      the Conversion  Date  multiplied by .70, or (ii) the average of the lowest
      of three-day trading prices during the five trading days immediately prior
      to the funding date(s).

                                       14
<PAGE>

            o     The Company is authorized to issue 600,000  shares of class IV
                  preferred  stock,  $1.00 par value per share, of which 517,500
                  shares are issued and outstanding at December 31, 2006.

o     Series V: The Company amended its articles of  incorporation  in November,
      2006 and  authorized  the creation of 500,000 shares of Series V Preferred
      Stock ("Series V") at a par value $1.00 per share. Such shares were issued
      based on the Stock Purchase  Agreement and Share Exchange  entered into on
      May 12, 2005 between the Company and the  shareholders of Cargo Connection
      Logistics  Corp.  and Cargo  Connection  Logistics -  International,  Inc.
      (f/k/a   Mid-Coast   Management,   Inc.)  which   called  for   additional
      consideration  to  be  given  to  the  shareholders  of  Cargo  Connection
      Logistics Corp. and Cargo Connection  Logistics - International,  Inc. The
      Company was to issue shares of its preferred  stock which are  convertible
      into common stock of Cargo Connection Logistics Holding,  Inc. twelve (12)
      months  from  the  closing  date of the  this  transaction  so that  Cargo
      Connection Logistics Corp. and Cargo Connection Logistics - International,
      Inc.  will own  eighty  percent  (80%) of the  outstanding  shares  of the
      Company at that time.

            o     Each share of the Series V preferred stock is convertible into
                  shares  of the  Company's  common  stock.  Each  holder of the
                  Series V preferred  stock has a number of votes on all matters
                  submitted  to  shareholders  that is  equal to the  number  of
                  shares of common  stock  into which  such  holder's  shares of
                  Series V preferred stock are then convertible.  Each one share
                  of Series V Preferred Stock is convertible into 7575 shares of
                  Common  Stock.  In  addition,  the  holders  of the  Series  V
                  preferred  stock are  entitled to receive  noncumulative  cash
                  dividends  at an annual  dividend  rate as  determined  by the
                  Board  of  Directors.   In  the  event  of  any   liquidation,
                  dissolution or winding up of the Company, whether voluntary or
                  involuntary,  the Company's  articles of  incorporation  state
                  that,  the  holders  of the  Series  V  Preferred  Stock  then
                  outstanding  shall be entitled to receive out of the assets of
                  the  Corporation,   whether  from  capital  or  from  earnings
                  available for  distribution  to its  stockholders,  before any
                  amount shall be paid to the holders of common stock.

                        o     The Company is authorized to issue 500,000  shares
                              of Series V preferred  stock,  $1.00 par value per
                              share,  of which  479,867  shares  are  issued and
                              outstanding at December 31, 2006.

Warrants

                                       15
<PAGE>

In connection with the convertible debt issued on December 29, 2005, the Company
has  2,000,000  warrants   outstanding  as  of  December  31,  2006,  which  are
exercisable at an exercise price of $0.001 and expire on December 28, 2008.

Options

In August 1999, the Company's stockholders approved the adoption of an Incentive
Stock Option Plan ("1999 Option  Plan"),  which allows the Board of Directors to
grant  options to  employees  and  members of the Board of  Directors.  The 1999
Option  Plan  provided  the Board of  Directors  the right to grant  options  to
purchase  up to a total of 100,000  shares of the  Company's  common  stock.  On
August 17, 2000,  with the  approval of the  shareholders  of the  Company,  the
number  of  shares  available  under  the  1999  Option  Plan was  increased  to
1,000,000.  As of December 31, 2006,  220,000 options were outstanding under the
1999 Option Plan.  During the year ended  December 31, 2006, the Company did not
issue any shares of its common stock under non-plan  options in lieu of granting
options. As of December 31, 2006, the non-plan options were 100,000.

Transfer Agent

Cargo Connection Logistics Holding, Inc.'s transfer agent is:

                  Florida Atlantic Stock Transfer
                  7130 Nob Hill Road
                  Tamarac, FL 33321
                  Telephone: (954) 726-4954


                                       16
<PAGE>

Item 6. - MANAGEMENT DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

GENERAL

As of May 12, 2005, Cargo Connection Logistics Holding, Inc. (f/k/a Championlyte
Holdings,  Inc.) began operating in the transportation and logistics industry as
a third party  logistics  provider of  transportation  and management  services,
through its subsidiaries,  Cargo Connection Logistics Corp. and Cargo Connection
Logistics -  International,  Inc.  (f/k/a  Mid-Coast  Management,  Inc.), to its
target client base, ranging from mid-sized to Fortune 100(TM) companies. This is
accomplished  through  its network of  terminals  and  transportation  services.
Effective  May 23, 2005,  the name  Championlyte  Holdings,  Inc. was changed to
Cargo Connection  Logistics  Holding,  Inc. to better reflect the new nature and
focus of the entity and its operations. Cargo Connection Logistics Holding, Inc.
and all of its subsidiaries are collectively referred to as the "Company."

Cargo  Connection  Logistics Corp.  performs  truckload and  less-than-truckload
(LTL) transportation utilizing company equipment,  dedicated owner operators and
approved contract  carriers.  A core competency is specializing in time-definite
transportation and offers to its customers,  expedited,  dedicated and exclusive
use  vehicles.  Exclusive  use  services  require  pinpoint  and time  sensitive
coordination  for those  customers.  Revenues  for these  services  account  for
approximately 20% of the total transportation.

In addition,  the Companies operate U.S. Customs Bonded warehouse facilities and
container freight station operations and a General Order warehouse. The services
provided  are  specifically  designed to enhance  and to support the  customer's
supply chain  logistics  needs through  operational  excellence and  value-added
services.  This is accomplished through innovative solutions taking into account
the specific diversified markets of our customers.

Our Companies are  dedicated to providing  our customers  with premium  services
that can be  customized  to meet their  individual  needs and are also  flexible
enough to cope with an ever-changing business environment.

Although our gross revenues increased by over 22% from the previous fiscal year,
our net loss also  increased  from the previous  fiscal year by 22%.  Management
believes that in the upcoming  year there will be a continued  increase in gross
revenue and also believes that,  based upon its business plan for 2007, it's net
loss from operations will decrease.  The financial  obligations that the Company
has entered into with regard to its  convertible  debt will  continue to consume
significant   working  capital  and  impact  our  operations  through  continued
significant  changes in interest  expense and the continued  revaluation  of our
financial  instruments.  The  upcoming  year  will see the  Company  expand  its
businesses  through  additional  joint ventures which will enable the Company to
globalize  its  services  offered to our  customers.  The  Company  will look to
further expand its revenue  stream through its local  operations in New York and
look to expand its revenue stream through its current  operations in Florida and
Illinois. The Company will also be looking to expand its revenue streams through
its current  operations  in Georgia in the 2008 fiscal  year,  while  laying the
groundwork for such expansion during the 2007 fiscal year.

The  Company's  transportation  revenue  was above  last  year's  levels and was
derived from its trucking  operations.  Its customer base has increased over the
past year as it has  continued  to replace its reliance on major  customers  and
broaden its reliance through a broader customer base.  Warehouse  services still
needs to generate additional sales and cultivate new customers for its services.
We anticipate that the turnaround for these warehouse  services to begin to take
place  during the 2007 fiscal  year as a major push had begun  during the latter
part of 2006.  The Company's  past reliance on a major customer for the services
it offered was a major factor in the slow turnaround since 2005.

                                       17
<PAGE>

RESULTS OF OPERATIONS

Revenues from all  operations for the twelve months ended December 31, 2006 were
$17,927,544  compared with  $14,661,851 for the twelve months ended December 31,
2005. The $3,265,693 increase in revenue, which equates to a 22.2% increase, was
specifically  due to the  transportation  and trucking related business of Cargo
Connection  Logistics  Corp.  The  Company  has  been  working  at  bringing  in
additional  business in our Container Freight Station  operations.  That part of
the operation had revenue amounting to $7,548 in 2006 versus $1,289,722 in 2005.
That  operation's  revenue has  decreased by  approximately  $1,282,000  for the
twelve months ended December 31, 2006 versus  December 31, 2005.  This is mainly
due to the refocus of this entity to the  international  arena this year and the
loss of business from the change in the business  model from a major customer in
2005. But the  transportation  services  operation  increased by over $4,525,000
during  that same  twelve  month time  period  ending  December  31, 2006 versus
December 31, 2005.

Looking at each subsidiary independently, revenues generated from the operations
of Cargo  Connection  Logistics  Corp.  for the twelve months ended December 31,
2006,  were  $17,897,214  compared with  $13,372,129 for the twelve months ended
December  31,  2005.  The  majority  of the  $4,525,085  increase in revenue was
generated from trucking operations.  This represents a 34% increase for the same
twelve  month  period  comparing  2006  versus  2005.  This  increase  in  Cargo
Connection  Logistics Corp.'s revenue was due to (a) an increase in core service
offerings associated with client acceptance of those offerings, (b) expansion in
the New York  marketplace  which included  additional local pick up and delivery
services and (c) the addition of the General  Order  warehouse  operation at JFK
that began in June,  2006. The Company has also continued to expand its customer
base so as not to be as reliant on a few key customers as it had in the past.

Conversely,  revenues  generated  from the  operations of Mid-Coast  Management,
Inc.,  prior to its becoming Cargo Connection  Logistics - International,  Inc.,
for the six months ended June 30, 2006 were $598  compared with $986,042 for the
six months ended June 30,  2005.  This  reflects a decrease in gross  revenue of
$985,444  over the same time period for the  previous  year.  The reason for the
decrease is due to a change in the business  relationship  with a major customer
and a transition of the remaining business into Cargo Connection Logistics Corp.
Under its prior  relationship,  Mid-Coast  Management,  Inc. was  restricted  in
obtaining  new  customers  in certain  markets and as a result  caused a loss of
potential revenues.  The business  opportunities for this subsidiary will remain
in the  international  markets  and  under  the  Cargo  Connection  Logistics  -
International,  Inc. banner, where the opportunities are already being explored.

In comparing the operating  costs for the twelve months ended  December 31, 2006
to the twelve months ended December 31, 2005 we show direct  operating  expenses
of $12,296,989 versus $10,515,809 for that time period, respectively. The direct
operating  expenses  were  higher by  $1,781,180  or 17% for the twelve  months.
However,  as a percentage  of revenue,  the expenses were down in 2006 from 2005
and were 69% versus 72%,  respectively  in each year. The higher costs this year
are substantially due to a $1,696,918  increase in outside handling and trucking
costs,  an  increase  in direct  labor of $45,404  and a  decrease  in truck and
trailer  repairs in the amount of $44,503 and an increase in warehouse  expenses
in the amount of $71,446  along with an increase of $82,142 in truck fuel costs.
Along with this there was a decrease in driver  travel  expenses  of $18,936,  a
decrease in permits and fees of $7,555,  a decrease in truck  trailer  leases of
$19,538, and a decrease in equipment rentals of $24,534.

                                       18
<PAGE>

The  gross  profit  for year  ended  December  31,  2006 was  $5,630,554  versus
$4,146,042  for the same time period ending  December 31, 2005. The major reason
for the increase in gross  profit of  $1,484,512  is due to the direct  trucking
revenue,  mostly derived from the new local and general order warehouse business
at the JFK facility. The gross profit percentage for December 31, 2006 was 31.4%
as compared  to 28.3% gross  profit  percentage  for  December  31,  2005.  This
resulted in an increase in the December 31, 2006 gross profit  percentage  of 3%
from  December 31, 2005 gross profit  percentage.  This increase in gross profit
percentage  was   associated   with  the  decrease  in  direct  labor  costs  of
approximately 2% and a decrease in truck/trailer lease costs of approximately 1%
from December 31, 2006 versus December 31, 2005.

Selling,  general and  administrative  expenses were  $7,946,906  for the twelve
months ended  December 31, 2006 compared with  $7,849,716  for the twelve months
ended  December  31,  2005.  The  $97,190  increase  in  selling,   general  and
administrative  expenses  represents  a  negligible  increase  over the previous
year's  twelve  months as a percentage  of revenue.  As a percentage of revenue,
these expenses as a percentage  decreased from the same twelve month period last
year from 44.3% in 2006 versus 53.5% in 2005.  These  expenses are primarily the
result of increased  consulting and  professional  fees  associated with being a
public entity which amounted to approximately $550,000 over the same period last
year. In addition,  we have decreased our rent expense by over $650,000 from the
previous  year  which  is  mostly  derived  from the  renegotiation  of the rent
expenses and partial rent abatement at the JFK facility.  Please note,  however,
that the  Company has posted an  additional  $495,000  in other  expenses  for a
potential  liability of guaranteed  rental  expenses for a related party for its
Illinois  facility.  Salaries  and  wages  increase  by over  $514,000  from the
previous  year which is due to an increase in  employees  at the JFK facility to
handle the increase in business that began in June, 2006.  Insurance,  telephone
and utilities were up by more than $83,000 from the previous year's twelve month
period which is associated with an increase in insurance of $17,000, an increase
in telephone of $34,000 and an increase in utilities of $32,000. There have been
decreases in bad debt  allowance  by  approximately  $382,868  during the twelve
months  period  from last year.  There has been a decrease  in  depreciation  by
84,000 which is the result of assets that became fully  depreciated  during 2006
and a decrease  in the  repairs/maintenance  expense by 45,000,  an  increase in
consulting fees of $95,000, an increase in postage and delivery by $24,000 and a
decrease in equipment rental by $8,000 for the year December 31, 2006.

The net result of these  efforts was a decrease in loss from  operations  before
other income  (expense) of $2,316,351  for the twelve months ended  December 31,
2006  compared to an operating  loss of  $3,703,674  for the twelve months ended
December 31, 2005. As a percentage of revenue,  the $1,387,323  decrease in loss
from  operations  represents an approximate 38% improvement for the twelve month
period compared with 2005.

Interest and  financing  expense  amounted to  $1,858,821  for the twelve months
ended  December 31, 2006 as compared to  $1,364,939  for the twelve months ended
December 31, 2005. This increase of  approximately  $493,882 is primarily due to
the associated interest on note conversions during the period.

The Company has taken a stance with regard to its  guarantee  of lease  payments
for  a  related  party.  Underwing  International,  Inc.  ("Underwing")  is  the
leaseholder  of a building in  Bensenville,  IL where the  Company's  subsidiary
maintains  its  facility.  Underwing has an  outstanding  obligation  due to its
Landlord in the amount of  $495,000  through  December  31, 2006 for the rent on
this facility.  To the Company's  knowledge,  there has been no default  notices
sent by  Underwing's  Landlord  to  Underwing.  However,  as the  Company is the
guarantor of the lease  payments,  management has taken the approach to book the
potential liability on its financial statements.

The net effect for the twelve  months  ended  December 31, 2006 is a net loss of
$5,865,325  compared to a net loss of  $4,527,363  for the twelve  months  ended
December 31, 2005.  The increase in the net loss of  $1,337,962 is primarily due
to an increase in costs of $1,749,728 related to financial  instrument  downward
market  price   adjustments   along  with  an  decrease  of  $112,252  for  debt
extinguishment and in increase of $493,882 in financing expenses,  a decrease in
gain on sale of assets in the amount of $3,933, an increase in minority interest
adjustments of $987, an increase in direct operating expenses of $1,781,180,  an
increase in indirect  operating  expenses of $97,190,  an increase in guaranteed
rental  expense of  $495,000,  an increase in the  remaining  other  expenses of
$94,008 along with an increase in revenue of  $3,265,693  from  operations.  The
Company in 2006 will spend a full twelve (12) months as a public entity.

                                       19
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

The Company  incurred a net loss of $5,865,325  for the year ended  December 31,
2006, a working capital  deficiency of $8,509,244 and an accumulated  deficit of
$14,099,352 as of December 31, 2006. The Company has devoted  substantially  all
of its efforts to increasing revenues,  achieving  profitability,  and obtaining
long-term financing and raising equity.

The  Company's  consolidated  financial  statements  have been  prepared  on the
assumption  that the Company will  continue as a going  concern.  Management  is
seeking  various  types of  additional  funding  such as issuance of  additional
common  or  preferred  stock,   additional  lines  of  credit,  or  issuance  of
subordinated  debentures or other forms of debt will be pursued.  However, it is
not  possible  to  predict  the  success  of  management's  efforts  to  achieve
profitability.  Also, there can be no assurance that additional  funding will be
available  when needed or, if  available,  that its terms will be  favorable  or
acceptable.

If the  additional  financing or  arrangements  cannot be obtained,  the Company
would be materially and adversely  affected and there would be substantial doubt
about the Company's  ability to continue as a going  concern.  The  consolidated
financial   statements   do  not  include  any   adjustments   relating  to  the
recoverability  and  realization  of assets and  classifications  of liabilities
necessary if the Company becomes unable to continue as a going concern.

Our available  cash at December 31, 2006 was $338,678.  In addition  there is an
additional  $361,846 in escrowed funds being held by Cargo  Connection's  factor
used to assist in the payment of transportation costs.

There is also a short-term Convertible Secured Debenture due to current officers
of Cargo  Connection in the amount of $75,000 at a 15% interest rate and was due
September 30, 2006.  The Holders of this Note have agreed to  informally  extend
the due  date of this  note  for an  additional  twelve  month  period,  thereby
extending the due date to September 30, 2007.

On December 29, 2005, the Company entered into a financing agreement, which when
completed  resulted  in  a  Convertible  Secured  Debenture  in  the  amount  of
$2,350,000 with Montgomery Equity Partners, Ltd. Pursuant to the agreement,  the
Company issued two secured  convertible  debentures,  one of which was issued on
December 29, 2005 ion the amount of  $1,750,000  and the balance of $600,000 was
issued  February 13, 2006.  The Company  issued to Montgomery  Equity  Partners,
Ltd., a secured  convertible  debenture In the amount of  $2,350,000  with a 10%
interest  rate and a maturity  date of December  28, 2007 and February 12, 2008,
respectively  for each traunch of funds received.  The debentures are secured by
Company  assets  pursuant to a Security  Agreement,  dated December 30, 2005. To
date the Company has reduced its outstanding  obligation by $100,000,  which was
accomplished via the conversion of debt into common stock during 2006.

On October 27, 2005,  the Company  designated  100,000  shares of a class of its
Series III  Preferred  Stock,  par value $1.00,  to Jesse  Dobrinsky and John L.
Udell  ("Investors")  collectively as  consideration  for funds in the amount of
$100,000 given to the Company.

                                       20
<PAGE>

FUTURE OUTLOOK

Over the course of fiscal year 2006,  the Company has  continued to go through a
variety of changes.  One was its focus on business  revenue streams and specific
industries.  The  Company's  core focus is in the  Transportation  and Logistics
Industry and those ancillary  businesses and needs that it  complements.  One of
its  subsidiaries,  Cargo  Connection  Logistics  Corp., is capable of being the
Domestic  transportation partner for those International companies which require
assistance throughout the United States. In addition, the transportation network
that is  currently  in place  allows for the  movement of goods  throughout  the
United States,  Canada and Mexico on behalf of its customers.  Cargo  Connection
has the  facilities  necessary to assist  companies with their freight by either
holding the freight in their bonded  facilities or possibly  sorting freight for
the  client  while  the goods  are  clearing  customs  in its  Customs  approved
Container Freight Stations.

The Company's other subsidiary, Cargo Connection Logistics - International, Inc.
(f/k/a Mid-Coast Management, Inc.), is focusing its efforts in the international
logistics arena which sales efforts continuing in China, Vietnam and the Pacific
Rim as well as other  areas such as Costa Rica.  The  Company  has been  working
together with American River International, Ltd. to assist in promoting business
opportunities  and to help provide Cargo  Connection with the required  licenses
and certifications to do business outside the U.S.

The Company has added a new  subsidiary at the end of this year.  The subsidiary
known as Nuclear Material Detection Technologies, Inc. (NMDT) is an organization
whose  primary  business  application  is  the  detection  of  radiation  in the
logistics,  transportation and general cargo industry. With the current security
environment  in the  transportation  industry  this  is not  just  complementary
portion of the business but one that at some point in the near future may become
a requirement for the transportation industry.

NMDT  operations  will be  independent  of Cargo and its product will be sold to
private industry and well as different divisions of the United States Government
and  foreign  governments  that have the need or the desire to instill  the same
security  ethics as the United States.  The  applications of this technology are
flexible  in that  they can be  applied  to fixed  installations  or  completely
transportable portable devices.

The advantage of this technology over existing  technology is the fact that this
technology is considerable  less  expensive,  has a memory and will also provide
identification  of the specific  isotope that is being detected.  The device can
also be  calibrated  to  eliminate  or set the  level of  acceptable  background
radiation, thereby minimizing the number of false alarms.

Independent  Transportation  Group ("ITG"),  one of the entities that we partner
with has the  primary  goal of  attracting  independent  contractors  and  other
carriers by being able to offer agents and their drivers, comprehensive packages
for medical  insurance,  profit sharing  plans,  as well as other  benefits.  An
additional benefit for the Company is that it may also attract these independent
contractors  and other  carriers to perform  work on behalf of Cargo  Connection
Logistics, thereby assisting the Company in increasing the size and scope of its
driver fleet.

The Company will continue to look at other areas in which it can become involved
that will  complement  the needs of the  industry,  either by adding  additional
services,  through the formation of entities that will have specific  attributes
or by acquisitions of other entities.

We have  restructured  some of our outstanding debt and have continued to retire
most of the existing  debt that was currently  outstanding.  We will continue to
persue  better  terms  on the  remaining  outstanding  debt  instruments.  These
additional enhancements will require additional financing.

                                       21
<PAGE>

CRITICAL ACCOUNTING POLICIES

We have  identified  the  policies  outlined  below as critical to our  business
operations and an  understanding  of our results of operations.  The list is not
intended to be a comprehensive list of all of our accounting  policies.  In many
cases,  the accounting  treatment of a particular  transaction  is  specifically
dictated by accounting  principles generally accepted in the United States, with
no need for  management's  judgment  in their  application.  The  impact and any
associated  risks  related  to these  policies  on our  business  operations  is
discussed throughout  Management's Discussion and Analysis or Plan of Operations
where such policies affect our reported and expected  financial  results.  For a
detailed  discussion on the application of these and other accounting  policies,
see the Notes to the  Financial  Statements.  Note that our  preparation  of the
financial  statements  requires us to make estimates and assumptions that affect
the reported amount of assets,  liabilities,  revenues and expenses, and related
disclosure  of  contingent   assets  and  liabilities.   Certain  estimates  and
assumptions  required to be made relate to matters that are inherently uncertain
as they pertain to future events.  While management  believes that the estimates
and  assumptions  used were the most  appropriate,  actual  results could differ
significantly from those estimates under different assumptions and conditions.

The  following  is a  description  of  those  accounting  policies  believed  by
management to require  subjective and complex  judgments which could potentially
affect reported results.

Revenue Recognition and Accounts Receivable

The Company recognizes all  transportation  revenues based upon the tendering of
the  freight  to the  Company  for the  delivery  of the  goods to  their  final
destination.  The  warehouse  services  operations  recognize  revenue  upon the
completion  of services.  Costs  related to such revenues are included in direct
operating expenses.

Accounts receivable are recorded at the outstanding amounts net of the allowance
for doubtful  accounts.  Estimates  are used in  determining  our  allowance for
doubtful  accounts  based on the  inability of our  customers  to make  required
payments,  historical  collections  experience,  current  economic  trends and a
percentage of our accounts  receivable by aging  category.  We review  available
customer account and financial information,  including public filings and credit
reports,  current trends,  credit policy, and accounts  receivable aging and may
also consult legal counsel when appropriate.  We also look at the credit quality
of our customer base as well as changes in our credit policies.  We continuously
monitor  collections and payments from our customers.  When the Company deems it
probable that an account of a specific customer will become uncollectible,  that
customer's  account balance will be included in the reserve  calculation.  While
credit losses have  historically  been within  expectations  and the  provisions
established,  we cannot  guarantee  that we will continue to experience the same
credit loss rates that we have in the past. Our net income is directly  affected
by management's estimate of the collectibility of accounts receivable.

Long-Lived Assets

On a periodic basis,  management  assesses whether there are any indicators that
the  value  of its  long-lived  assets  may be  impaired.  An  asset's  value is
considered  impaired  only if  management's  estimate of current  and  projected
operating cash flows  (undiscounted  and without interest  charges) of the asset
over its remaining useful life is less than the net carrying value of the asset.

                                       22
<PAGE>

Such cash flow  projections  consider  factors such as expected future operating
income, trends and prospects, as well as the effects of demand,  competition and
other factors. To the extent impairment has occurred, the carrying amount of the
asset would be written down to an amount to reflect the fair value of the asset.

We  are  required  to  make  subjective  assessments  as to  whether  there  are
impairments in the value of our long-lived assets and other investments. Our net
income is directly affected by management's estimate of impairments.

Deferred Income Taxes

Determining  the  consolidated  provision  for  income tax  expense,  income tax
liabilities and deferred tax assets and liabilities involves judgment. We record
a valuation  allowance to reduce our deferred tax assets to the amount of future
tax  benefit  that is more likely than not to be  realized.  We have  considered
future  taxable  income and prudent and  feasible  tax  planning  strategies  in
determining  the  need for a  valuation  allowance.  A  valuation  allowance  is
maintained by the Company due to the impact of the current  year's net operating
loss (NOL).  In the event that we determine that we would not be able to realize
all or part of our net deferred tax assets,  an  adjustment  to the deferred tax
assets would be charged to net income in the period such determination is made.

Likewise,  if we later  determine  that it is more  likely than not that the net
deferred  tax  assets  would  be  realized,  and then  the  previously  provided
valuation  allowance would be reversed.  Our current valuation allowance relates
predominately to benefits derived from the utilization of our NOL's.

Derivatives Instruments

In connection with the sale of debt or equity instruments,  the Company may sell
options or warrants  to purchase  our common  stock.  In certain  circumstances,
these options or warrants may be classified  as derivative  liabilities,  rather
than as  equity.  Additionally,  the  debt or  equity  instruments  may  contain
embedded derivative  instruments,  such as variable conversion options, which in
certain  circumstances may be required to be bifurcated from the host instrument
and accounted for separately as a derivative instrument liability.

The  identification of, and accounting for,  derivative  instruments is complex.
Derivative  instrument  liabilities  are re-valued at the end of each  reporting
period,  with  changes in fair value of the  derivative  liability  recorded  as
charges  or  credits to income in the  period in which the  changes  occur.  For
options,  warrants and bifurcated  conversion  options that are accounted for as
derivative  instrument  liabilities,  we  determine  the  fair  value  of  these
instruments  using the Black-Sholes  option pricing model,  binomial stock price
probability trees, or other valuation techniques,  sometimes with the assistance
of a certified valuation expert. These models require assumptions related to the
remaining term of the  instruments  and risk-free  rates of return,  our current
common stock price and expected  dividend yield, and the expected  volatility of
our common stock price based on not only the history of our stock price but also
the experience of other entities considered comparable to us. The identification
of, and accounting for, derivative instruments and the assumptions used to value
them can significantly affect our financial statements.

The  Company  has  allocated  the  proceeds   received  from   convertible  debt
instruments  between the underlying debt  instruments and the warrants,  and has
recorded the conversion  feature as a liability in accordance with SFAS No. 133,
"Accounting for Derivative  Instruments and Hedging Activities" ("SFAS 133") and
related interpretations.  The conversion feature and certain other features that
are considered embedded derivative instruments, such as a variable interest rate
feature, a conversion reset provision and redemption option,  have been recorded
at their  fair  value  within the terms of SFAS No. 133 as its fair value can be
separated  from the  convertible  note and its  conversion is independent of the
underlying  note  value.  The  conversion  liability  is marked  to market  each
reporting  period with the  resulting  gains or losses shown on the Statement of
Operations. The Company has also recorded the resulting discount on debt related
to the warrants and conversion  feature and is amortizing the discount using the
effective interest rate method over the life of the debt instruments.

                                       23
<PAGE>

Stock Based Transactions

We have concluded various transactions where we paid the consideration in shares
of our common stock. These transactions include:

      o     Acquiring the services of various professionals who provided us with
            a range  of  corporate  consultancy  services,  strategic  planning,
            development of business plans, investor presentations and advise and
            assistance   with   investments   funding;

      o     Settlement  of  our  indebtedness;  and

      o     Providing  incentives to attract  retain and motivate  employees who
            are important to our success.

When our stock is used in  transactions,  the  transactions are generally valued
using the price of the  shares  being  transferred  at the time the  shares  are
issued for the services  provided.  If the value of the asset or services  being
acquired is available and believed to fairly  represent  its market  value,  the
transaction is valued using the value of the asset or service being provided.

                                       24
<PAGE>

Item 7. - FINANCIAL STATEMENTS

Set forth below is a list of our  financial  statements  for  December 31, 2006,
included in this Annual Report on Form 10-K following Item 14.

================================================================================
                                                                          PAGE

Report of Independent Registered Public Accounting Firm....................F-1
Consolidated Balance Sheet as of December 31, 2006.........................F-2
Consolidated Statements of Operations for the Years Ended
  December 31, 2006 and 2005................... ...........................F-3
Consolidated Statements of Stockholders' Deficit for the Years
  Ended December 31, 2006 and 2005........ ................................F-4
Consolidated Statements of Cash Flows for the Years Ended
  December 31, 2006 and 2005...............................................F-5
Notes to Consolidated Financial Statements.................................F-6


                                       25
<PAGE>

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of
Cargo Connection Logistics Holding, Inc.
Inwood, New York

We have audited the accompanying  consolidated balance sheet of Cargo Connection
Logistics  Holding,  Inc. as of December  31, 2006 and the related  consolidated
statements of operations, and stockholders' deficit and cash flows for the years
ended  December  31,  2006  and  2005.   These  financial   statements  are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements  are free of material  misstatement.  The Company is not  required to
have,  nor were we  engaged to perform  an audit of its  internal  control  over
financial reporting.  Our audit included  consideration of internal control over
financial  reporting  as  a  basis  for  designing  audit  procedures  that  are
appropriate  in the  circumstances,  but not for the  purpose of  expressing  an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting.  Accordingly,  we express  no such  opinion.  An audit also  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial  statements.  An audit also  includes  assessing  the  accounting
principles  used  and  significant  estimates  made  by  management,  as well as
evaluating the overall  financial  statement  presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the consolidated  financial position of Cargo
Connection Logistics Holding,  Inc. as of December 31, 2006 and the consolidated
results of its  operations  and its cash flows for the years ended  December 31,
2006 and 2005 in conformity with accounting principles generally accepted in the
United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
the Company  will  continue as a going  concern.  As  discussed in Note 6 to the
consolidated  financial  statements,   the  Company  has  reported  losses  from
operations,  negative cash flows from  operating  activities,  negative  working
capital and has a stockholders'  deficit.  These  conditions  raise  substantial
doubt about its ability to continue as a going  concern.  Management's  plans in
regard to these  matters are  described  in note 6. The  consolidated  financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.


Friedman LLP
East Hanover, New Jersey
April 4, 2007


                                       F-1


<PAGE>



                    CARGO CONNECTION LOGISTICS HOLDING, INC.
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2006


                                     ASSETS
Current Assets
  Cash                                                    $   338,672
  Cash in escrow-factor                                       361,846
  Accounts receivable, net of doubtful
         accounts of $300,000                                 658,227
  Due from factor                                             351,924
  Prepaid expenses                                            302,029
                                                          ------------
Total current assets                                        2,012,698
                                                          ------------

Property and equipment, net of accumulated
         depreciation of $1,412,182                           326,639
Security deposits                                              90,808
License agreement - RadRope(TM)                             1,316,854
                                                          ------------
Total Assets                                              $ 3,746,999
                                                          ============


             LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS' DEFICIT

Current Liabilities
  Accounts payable and accrued expenses                   $ 3,815,535
  Financial instrument liability                            3,769,661
  Current portion of notes payable                             79,636
  Current portion of capital leases payable                    22,718
  Current portion of secured debentures                        75,000
  Due to related parties                                    1,127,159
  Due to officers                                              26,511
  Due to others                                             1,565,209
  Security deposits and escrowed funds                         40,513
                                                          ------------
Total current liabilities                                  10,521,942
                                                          ------------

Long term portion of capital leases payable                    14,317
Long term portion of notes payable                             94,384
Long term portion of secured debenture                        573,724
Deferred rent                                               1,063,525
                                                          -----------
    Total Liabilities                                      12,267,892
                                                          -----------

Minority interest - ITG subsidiary                                987

Series III convertible  preferred  stock,  par value
  $1.00 - authorized  500,000 shares,  265,000
  shares issued and outstanding  (liquidated value
  of $265,000)                                                265,000

Series IV  convertible  preferred  stock,  par value
  $1.00 - authorized  600,000 shares,  517,500 shares
  issued and  outstanding  (liquidation  value $517,500)      517,500

Series V  convertible  preferred  stock,  par value
  $1.00 -  authorized  500,000 shares,  479,867 shares
  issued and  outstanding  (liquidation  value $479,867)      479,867

Stockholders' Deficit
  Common stock, par value $.001 - authorized
    5,000,000,000 shares, 1,082,912,617 shares issued
    and outstanding                                         1,082,913
  Additional paid in capital                                3,242,192
  Deferred offering costs                                     (10,000)
  Accumulated deficit                                     (14,099,352)
                                                          ------------
    Total Stockholders' Deficit                            (8,521,880)
                                                          ------------
Total Liabilities and Stockholders' Deficit               $ 3,746,999
                                                          ============


           See accompanying notes to consolidated financial statements

                                       F-2


<PAGE>



                    CARGO CONNECTION LOGISTICS HOLDING, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                        FOR THE YEARS ENDED DECEMBER 31,


<TABLE>
<CAPTION>

                                                       2006                2005
                                                  -------------       -------------
<S>                                               <C>                 <C>
Operating revenue:
    Revenue                                       $ 17,927,544        $ 14,661,851
                                                  -------------       -------------
          Total revenue                             17,927,544          14,661,851
                                                  -------------       -------------

Operating expenses:
    Operating expenses                              12,296,989          10,515,809
    Selling                                            133,402             142,492
    General and administrative                       7,813,504           7,707,223
                                                  -------------       -------------
          Total operating expenses                  20,243,895          18,365,524
                                                  -------------       -------------
Loss from operations                                (2,316,351)         (3,703,673)
                                                  -------------       -------------

Other income (expense)
    Interest income                                        892               4,575
    Interest expense                                (1,858,821)         (1,364,939)
    Licensing revenue                                       --              25,000
    Rental income                                      123,950             157,000
    Guaranteed Rental Expense                          495,000                  --
    Income (expense) from financial instruments       (817,591)            932,137
    Gain (loss) on sale of asset                            --               3,933
    Minority interest - ITG                               (987)                 --
    Loss on early extinguishment of debt              (502,110)           (614,362)
    Other income (expenses)                                693              32,968
                                                  -------------       -------------
          Total other income (expense)              (3,548,974)           (823,688)
                                                  -------------       -------------
Net loss                                          $ (5,865,325)       $ (4,527,361)
                                                  =============       =============

Net loss per common share, basic and diluted      $    (0.0079)       $    (0.0157)
                                                  =============       =============

Weighted average number of common shares used
  in the net loss per share calculation            738,792,011         289,223,672
                                                  =============       =============
</TABLE>




          See accompanying notes to consolidated financial statements

                                       F-3


<PAGE>



                    CARGO CONNECTION LOGISTICS HOLDING, INC.
                                AND SUBSIDIARIES
               CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
                             AS OF DECEMBER 31, 2006

<TABLE>
<CAPTION>
                                                                                                    Series III
                                                                Common Stock                Convertible Preferred Stock
                                                        -----------------------------         -----------------------
                                                            Shares          Amount            Shares        Amount
                                                        -------------   -------------         -------   -------------

<S>                                            <C>     <C>              <C>                   <C>       <C>
Balance December 31, 2005                                 537,065,658         537,066         265,000         265,000
                                                        =============   =============         =======   =============
Issuance of shares in
consideration of convertible
note payable                                   Jan-06      34,743,093          34,743              --              --

Issuance of shares in
consideration of convertible
note payable                                   Feb-06      20,482,448          20,482              --              --

Issuance of shares in
consideration of accrued
expenses                                       Feb-06       4,541,352           4,541              --              --

Issuance of shares in
consideration of convertible
note payable                                   Mar-06      30,505,691          30,506              --              --

Conversion of preferred
stock to common stock                          Mar-06     180,000,000         180,000              --              --

Issuance of shares for
payment of services                            Mar-06      25,000,000          25,000              --              --

Issuance of shares in
consideration of convertible
note payable                                   May-06       1,562,500           1,563              --              --

Issuance of shares in
consideration of convertible
note redemption                                Jul-06      10,571,238          10,571              --              --

Issuance of shares in
consideration of accrued
expenses                                       Jul-06       1,065,812           1,066              --              --

Issuance of shares in
consideration of convertible
secured debenture                              Jul-06      40,000,000          40,000              --              --

Issuance of shares for
payment of services                            Aug-06       4,838,710           4,839              --              --

Amortization of deferred
costs                                          Sep-06              --              --              --              --

Issuance of shares for
payment of services                            Dec-06       7,142,857           7,143              --              --

Issuance of shares in
connection with purchase of
NMDT                                           Dec-06     168,539,326         168,539              --              --

Issuance of shares for
payment of services                            Dec-06      16,853,932          16,854              --              --

Issuance of shares in
connection with May 2005
reverse merger agreement 12-
month pro                                      Dec-06              --              --              --              --

Amortization of deferred
costs                                          Dec-06              --              --              --              --

Net loss
                                                                   --              --              --              --

                                                        -------------   -------------         -------   -------------
Balance December 31, 2006                               1,082,912,617   $   1,082,913         265,000   $     265,000
                                                        =============   =============         =======   =============


<CAPTION>
                                                        Series IV                        Series V
                                                 Convertible Preferred Stock   Convertible Preferred Stock
                                                  ------------------------    -----------------------------
                                                   Shares        Amount           Shares         Amount
                                                  -------    -------------    -------------   -------------

<S>                                              <C>         <C>               <C>            <C>
Balance December 31, 2005                         552,500          552,500               --              --
                                                  =======    =============    =============   =============
Issuance of shares in
consideration of convertible
note payable                                           --               --               --              --

Issuance of shares in
consideration of convertible
note payable                                           --               --               --              --

Issuance of shares in
consideration of accrued
expenses                                               --               --               --              --

Issuance of shares in
consideration of convertible
note payable                                           --               --               --              --

Conversion of preferred
stock to common stock                             (35,000)         (35,000)              --              --

Issuance of shares for
payment of services                                    --               --               --              --

Issuance of shares in
consideration of convertible
note payable                                           --               --               --              --

Issuance of shares in
consideration of convertible
note redemption                                        --               --               --              --

Issuance of shares in
consideration of accrued
expenses                                               --               --               --              --

Issuance of shares in
consideration of convertible
secured debenture                                      --               --               --              --

Issuance of shares for
payment of services                                    --               --               --              --

Amortization of deferred
costs                                                  --               --               --              --

Issuance of shares for
payment of services                                    --               --               --              --

Issuance of shares in
connection with purchase of
NMDT                                                   --               --               --              --

Issuance of shares for
payment of services                                    --               --               --              --

Issuance of shares in
connection with May 2005
reverse merger agreement 12-
month pro                                              --               --          479,867         479,867

Amortization of deferred
costs                                                  --               --               --              --

Net loss
                                                       --               --               --              --

                                                  -------    -------------    -------------   -------------
Balance December 31, 2006                         517,500    $     517,500    $     479,867   $     479,867
                                                  =======    =============    =============   =============


<CAPTION>
                                           Additional        Deferred                             Total
                                             Paid-in          Offering         Accumulated      Stockholders'
                                             Capital           Costs             Deficit        Deficiency
                                          -------------    -------------      ------------      -----------

<S>                                       <C>                <C>            <C>              <C>
Balance December 31, 2005                     1,008,831          (10,000)       (8,234,027)      (5,880,630)
                                          =============    =============      ============      ===========
Issuance of shares in
consideration of convertible
note payable                                     48,757               --                --           83,500

Issuance of shares in
consideration of convertible
note payable                                     39,518               --                --           60,000

Issuance of shares in
consideration of accrued
expenses                                          8,492               --                --           13,033

Issuance of shares in
consideration of convertible
note payable                                     79,494               --                --          110,000

Conversion of preferred
stock to common stock                          (145,000)              --                --               --

Issuance of shares for
payment of services                             225,000               --                --          250,000

Issuance of shares in
consideration of convertible
note payable                                     21,875               --                --           23,438

Issuance of shares in
consideration of convertible
note redemption                                 266,951               --                --          277,522

Issuance of shares in
consideration of accrued
expenses                                          7,684               --                --            8,750

Issuance of shares in
consideration of convertible
secured debenture                               528,000               --                --          568,000

Issuance of shares for
payment of services                             115,161               --                --          120,000

Amortization of deferred
costs                                                --               --                --               --

Issuance of shares for
payment of services                              67,857               --                --           75,000

Issuance of shares in
connection with purchase of
NMDT                                          1,348,315               --                --        1,516,854

Issuance of shares for
payment of services                             101,124               --                --          117,978

Issuance of shares in
connection with May 2005
reverse merger agreement 12-
month pro                                      (479,867)              --                --               --

Amortization of deferred
costs                                                --               --                --               --

Net loss
                                                     --               -- ~      (5,865,325)      (5,865,325)

                                          -------------    -------------      ------------      -----------
Balance December 31, 2006                 $   3,242,192    $     (10,000)     $(14,099,352)     $(8,521,880)
                                          =============    =============      ============      ===========
</TABLE>


                See notes to consolidated financial statements.

                                       F-4

<PAGE>


                    CARGO CONNECTION LOGISTICS HOLDING, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                        FOR THE YEARS ENDED DECEMBER 31,


<TABLE>
<CAPTION>
                                                         2006             2005
                                                    ------------       ------------
<S>                                                <C>                <C>
Cash flows from operating activities:
Net loss                                           $ (5,865,325)      $ (4,527,363)
 Adjustments to reconcile net loss to net
  cash provided by (used in) operating activities:
   Interest expense from financial instruments          490,902            163,845
   Amortization of note discounts                       645,158            258,377
   Mark to market on derivative instrument expense      817,591           (932,137)
   Depreciation and amortization                        161,927            246,031
   Deferred rent                                        187,959            781,252
   Issuance of shares for services                      562,978            190,033
   Bad debt expense                                      52,996            270,983
   Loss on extinguishment of debt                       534,789            614,362
   Write off of deferred financing costs                     --           (105,000)
   Minority interest - ITG                                  987                 --
   Guaranteed rental expense                            495,000                 --
 Changes in operating assets and liabilities:
   (Increase) decrease in escrow held by factor        (208,982)           207,289
   Decrease (increase) in escrow held by attorney        49,351            (49,351)
   (Increase) decrease in accounts receivable           (2,165)            113,416
   Decrease (increase) in due from factor              259,760            (367,637)
   (Increase) decrease in prepaid expenses             (85,884)             49,303
   Decrease in due from employees                            --              7,240
   (Decrease) increase in accounts payable and
         accrued expenses                               (84,469)           732,583
   Decrease in note payable - factor                         --           (428,534)
   (Decrease) increase in security deposits
         and escrowed funds                              4,871                 595
                                                     ------------      ------------
Net cash used in operating activities                (1,982,558)        (2,774,713)
                                                     ------------      ------------
Cash flows from investing activities
   Redemption of security deposits                        3,171             88,880
   Payments received for security deposits              (18,445)                --
   Purchases of property and equipment                  (56,734)           (16,897)
   Proceeds from sale of common stock for
     investment in NMDT                                 200,000                 --
   Disposal of property and equipment                        --             38,347
                                                     ------------      ------------
Net cash provided by investing activities               127,992            110,330
                                                     ------------      ------------
Cash flows from financing activities
   Repayments from related parties                       66,378                 --
   Repayments from officers                                 430                 --
   Repayments towards officers                           (1,382)                --
   Repayments towards related parties                        --           (111,180)
   Amounts received from others                       1,502,709             62,500
   Amounts received from related parties                323,635            684,644
   Proceeds from sale of Series III Preferred Stock          --            100,000
   Proceeds from sale of Series IV Preferred Stock           --            490,000
   Proceeds from notes payable                               --             91,599
   Proceeds from secured debentures                     600,000          2,825,000
   Principal payments on convertible payable           (251,002)          (257,006)
   Principal payments on notes payable                 (229,388)                --
   Principal payments on capital leases payable         (65,160)           (69,786)
   Repayment of secured debenture                            --         (1,000,000)
                                                    ------------       ------------
Net cash provided by financing activities             1,946,220          2,815,771
                                                    ------------       ------------

Net increase (decrease) in cash                          91,654            151,388
Cash, beginning of year                                 247,018             95,630
                                                   -------------       ------------
Cash, end of year                                  $    338,672        $   247,018
                                                   =============       ============

Supplemental disclosure of cash flow information
  Interest expense                                 $  1,458,073        $    61,928
                                                   ============        ============
  Income taxes                                     $         --        $        --
                                                   ============        ============

Supplemental schedule of non-cash activities:
  Cancellation of shares issued to Cornell Capital $         --        $   790,000
                                                   ============        ============
  Shares issued to subsidiary in connection
   with reverse acquisition                        $         --        $   239,599
                                                   ============        ============
  Recapitalization of additional paid in capital
   in connection with reverse acquisition          $         --        $16,230,384
                                                   ============        ============
  Accrued interest assumed as part of
   convertible note                                $         --        $     2,721
                                                   ============        ============
  Conversion of convertible notes payable
   to common stock                                 $    350,290        $   512,527
                                                   ============        ============
  Conversion of preferred stock to common stock    $    180,000        $   142,000
                                                   ============        ============
  Conversion of secured debentures to common stock $    100,000        $        --
                                                   ============        ============
  Issuance of shares for settlement of payables    $     21,784        $   877,622
                                                   ============        ============
  Discount on secured debentures                   $    600,000        $        --
                                                   ============        ============
  Write off of derivatives for convertible
   note payable and secured debenture due to
   conversion and payoffs                          $    291,584        $        --
                                                   ============        ============
  Write off of discount on convertible note
   payable and secured debenture due to conversion
   and payoffs                                     $    154,204        $        --
                                                   ============        ============
  Purchase of equipment through capital lease      $     19,800        $        --
                                                   ============        ============
  Value of shares issued in connection with
   investment in NMDT                              $  1,316,854        $        --
                                                   ============        ============
</TABLE>

          See accompanying notes to consolidated financial statements

                                      F-5


<PAGE>


            CARGO CONNECTION LOGISTICS HOLDING, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2006 AND 2005

NOTE 1 - ORGANIZATION, HISTORY AND NATURE OF BUSINESS

On May 12, 2005, Cargo Connection  Logistics Holding,  Inc. (f/k/a  Championlyte
Holdings,  Inc.) began operating in the transportation and logistics industry as
a third party  logistics  provider of  transportation  and management  services,
primarily through its  subsidiaries,  Cargo Connection  Logistics Corp.  ("Cargo
Connection")  and  Cargo  Connection  Logistics  -  International,  Inc.  (f/k/a
Mid-Coast Management,  Inc.) ("Cargo International").  The Company's target base
ranges from mid-sized to Fortune 100(TM) companies.  Effective May 23, 2005, the
name  Championlyte  Holdings,  Inc.  was changed to Cargo  Connection  Logistics
Holding,  Inc. (the "Company") to better reflect the new nature and focus of the
entity and its operations.  Cargo Connection Logistics Holding,  Inc. and all of
its  subsidiaries  are  collectively  referred to as the  "Company." In December
2006,  the  Company  acquired  Nuclear  Material  Detection  Technologies,  Inc.
("NMDT"),  which has been  accounted for as a  wholly-owned  subsidiary.  Assets
acquired consist of a "patent right" and cash. The Company's primary business is
the detection of radiation in the  logistics,  transportation  and general cargo
industry.

The Company  owns a 51%  interest in  Independent  Transportations  Group,  Inc.
("ITG") and emplifyHR owns a 49% interest.  The financial  statements of ITG are
included  in the  Company's  consolidated  financial  statements.  The  minority
interest  in  operating  results is  reflected  as an  element of  non-operating
expense in the Consolidated  Statements of Operations and the minority  interest
in the equity of ITG is  reflected as a separate  component on the  Consolidated
Balance Sheet.

The Company is a provider of logistics solutions for global partners through its
network of branch locations and independent agents in North America. It operates
predominately  as a  non-asset  based  transportation  provider  which  provides
truckload and  less-than-truckload  (LTL) transportation services utilizing some
Company equipment,  dedicated owner operators and through our relationships with
transportation companies.

The Company also provides a wide range of value-added  logistics  services which
include U.S.  Customs Bonded  warehouse  facilities,  container  freight station
operations,  and a General Order  warehouse  operation which began in the latter
part of the  second  quarter  of 2006,  all of which  enhance  and  support  our
customer's  supply chain  logistics  needs.  Some of the  services  provided are
pick-and-pack  services,  special  projects that may include  changing labels or
tickets on items,  the inspection of goods into the United States and storage of
goods.

Last year Cargo Connection  became part of an exclusive number of companies that
work closely  with the  Department  of Homeland  Security and Customs and Border
Patrol  ("CBP").  The Company has become the sole General Order Warehouse at JFK
International Airport. General Order Warehouses operate under a specific Code of
Federal  Regulations which requires  merchandise to be considered  general order
merchandise when it is taken into the custody by CBP.

Cargo  Connection  and  Cargo   International  each  provide  a  wide  range  of
value-added  logistics  services  which include U.S.  Customs  Bonded  warehouse
facilities and container freight station  operations.  The services provided are
specifically  designed  to enhance and to support the  customer's  supply  chain
logistics needs.  Some of the logistics  services that are provided include pick
and pack services, special projects that will include changing labels or tickets
on items,  inspection  of goods into the United  States  and  recovery  of goods
damaged in transit.


                                      F-6
<PAGE>

Reverse Acquisition

On May 12, 2005,  Championlyte  Holdings,  Inc. purchased all of the outstanding
shares  of Cargo  Connection  and  Cargo  International  for a total of  seventy
percent  (70%)  of  the  issued  and  outstanding  shares  of  common  stock  of
Championlyte  Holdings,  Inc.  pursuant to a Stock Purchase  Agreement and Share
Exchange. As additional  consideration,  Championlyte Holdings,  Inc. will issue
shares of preferred stock to Cargo Connection and Cargo International, which are
convertible into common stock of Cargo Connection Logistics Holding, Inc. twelve
(12) months from the closing date of the  transaction  so that Cargo  Connection
and Cargo  International will own eighty percent (80%) of the outstanding shares
of Championlyte Holdings, Inc. at that time.

The acquisition of Cargo Connection and Cargo  International has been treated as
a recapitalization  and purchase by Cargo Connection and Cargo  International as
the accounting  acquirer (reverse  acquisition) of the Company, as control rests
with the former Cargo Connection and Cargo International shareholders.  Prior to
the  acquisition,  Championlyte  Holdings,  Inc.  had been the  registrant.  The
historical  financial  statements  prior  to May 12,  2005  are  those  of Cargo
Connection  and Cargo  International.  The  transaction  is considered a capital
transaction whereby  Championlyte  Holdings,  Inc. contributed its stock for the
net assets of Cargo Connection and Cargo International.

Reverse merger accounting  requires the Company to present in public information
filings the  historical  financial  statements  and other  information  of Cargo
Connection  and  Cargo  International.  The  Company's  historical  stockholders
investment  is  retroactively  restated for the  equivalent  number of shares of
common stock received in the merger. Accordingly,  the accompanying consolidated
financial  statements  present the results of  operations  for the twelve months
ended  December  31,  2006 and 2005  which are based upon  historical  financial
statements of Cargo  Connection and Cargo  International.  Subsequent to May 12,
2005, the operations reflect the combined  operations of the former Championlyte
Holdings, Inc. and Cargo Connection and Cargo International.


NOTE 2 - BASIS OF PRESENTATION

Principals of consolidation

The consolidated  financial  statements  include the accounts of the Company and
all subsidiaries.  All significant  intercompany  accounts and transactions have
been  eliminated  in  consolidation.   Certain  prior  year  amounts  have  been
reclassified to conform to the current year's presentation.


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash, concentration of credit risk

Financial  instruments,  which potentially subject the Company to concentrations
of credit risk,  consist of cash.  The Company places its cash with high quality
financial  institutions  and at times may  exceed  the FDIC  $100,000  insurance
limit.  The  Company  has not  experienced  any  losses on these  accounts,  and
believes that such risk in minimal.

The Company  extends credit based on an evaluation of the  customer's  financial
condition,  generally without  collateral.  Exposure to losses on receivables is
principally  dependent  on each  customer's  financial  condition.  The  Company
monitors its exposure for credit losses and maintains allowances for anticipated
losses, as required.

                                      F-7
<PAGE>

Financial instruments and credit risk

Financial  instruments,  which potentially subject the Company to concentrations
of credit risk,  consist primarily of accounts  receivable.  The Company extends
credit based on an evaluation of the customer's financial  condition,  generally
without collateral.  Exposure to losses on receivables is principally  dependent
on each customer's  financial  condition.  The company monitors its exposure for
credit losses and maintains allowances for anticipated losses, as required.

Allowance for doubtful accounts

The Company  carries  its  accounts  receivable  at cost less an  allowance  for
doubtful  accounts.  Management  makes  estimates  as to the  collectibility  of
accounts  receivable  and adjusts the doubtful  accounts when deemed  necessary,
based upon analysis of the aging of accounts receivable,  client credit reports,
industry trends and economic  indicators,  as well as analysis of recent payment
history for specific customers.

Property and equipment and depreciation and amortization

Property and equipment is recorded at cost.  Depreciation  and  amortization  of
property  and  equipment is provided  for by the  straight-line  method over the
estimated useful lives of the respective  assets.  The estimated useful lives of
the office  equipment,  trucks,  machinery  and  equipment,  and  furniture  and
fixtures are five years.  Computer  equipment and software is  depreciated  over
three years and leasehold  improvements  are  amortized  over the shorter of the
life of the improvement or the length of the lease.

The Company  recognizes rent expense based upon the  straight-line  method which
adjusts for rent abatements and future rent increases. In connection with future
minimum lease payments at December 31, 2006, the amount deferred was $1,063,525.

The Company  amortizes  deferred  financing  costs over the respective  terms of
their agreements using the straight-line method.

Valuation of long-lived assets

The Company accounts for its long-lived  assets in accordance with SFAS No. 144,
"Accounting  for the Impairment or Disposal of Long-Lived  Assets," ("SFAS 144")
which requires that long-lived assets be evaluated whenever events or changes in
circumstances  indicate that the carrying amount may not be recoverable.  If the
total of the undiscounted  future cash flows is less than the carrying amount of
the asset or asset group,  an impairment  loss is recognized  for the difference
between the  estimated  fair value and the carrying  value of the asset or asset
group. During the year ended December 31, 2006, there were no impairment charges
relating to long-lived assets.

Revenue recognition

The Company recognizes all  transportation  revenues based upon the tendering of
freight to the Company for the delivery of the goods at their final destination.
The  warehouse  services  operations  recognize  revenue upon the  completion of
services.  Costs  related  to such  revenue  are  included  in direct  operating
expenses.

Income taxes

The  Company  accounts  for  income  taxes in  accordance  with  SFAS  No.  109,
"Accounting  for Income  Taxes."  Deferred  taxes are provided on the  liability
method  whereby  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 financial
statement  and tax bases of assets  and  liabilities.  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. Current income taxes are
based on the  respective  periods'  taxable  income for federal,  state and city
income tax reporting purposes.  No benefit for income taxes has been provided as
the  deferred  tax asset  generated  from net  operating  losses  and  temporary
differences has been offset by a full valuation allowance.

                                      F-8
<PAGE>

Estimated liability for insurance claims

The Company  maintains  automobile,  general,  cargo, and workers'  compensation
claim  liability  insurance  coverage under both  deductible  and  retrospective
rating  policies.  In the month claims are reported,  the Company  estimates and
establishes any potential liabilities,  if they exist, for its share of ultimate
settlements using all available information, coupled with the Companies' history
of such claims. Claim estimates are adjusted when additional information becomes
available.  The recorded expense depends upon actual loss experience and changes
in  estimates  of  settlement  amounts  for open claims that have not been fully
resolved.  However,  final  settlement  of these  claims  could  differ from the
amounts the Company has accrued at year-end.

Use of estimates

The  preparation  of  consolidated   financial  statements  in  conformity  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 the disclosure of contingent  assets and
liabilities  at the  date  of the  consolidated  financial  statements  and  the
reported amounts of revenues and expenses during the reporting  periods.  Actual
results  could  differ from these  estimates.  The more  significant  accounting
estimates  inherent in the preparation of the Company's  consolidated  financial
statements  include  estimates  as to the  depreciable  lives  of  property  and
equipment,  valuation of equity related  instruments and derivatives issued, and
valuation allowance for deferred income tax assets

Fair value of financial instruments

For certain of the Company's consolidated financial instruments, including cash,
receivables,  accounts  payable,  and accrued  expenses,  the  carrying  amounts
approximate their fair values due to their short-term  maturities.  The carrying
amounts of the Company's  long-term debt also  approximate  fair values based on
current rates for similar debt offered to the Company.

Loss per common share

The Company  reports loss per share in accordance  with SFAS No. 128,  "Earnings
per  Share."  Basic loss per  common  share is  computed  by  dividing  net loss
allocable to common stockholders by the weighted average number of common shares
outstanding  for the period.  Diluted net loss per share  reflects  the dilution
from the potential  conversion or exercise into common stock of securities  such
as warrants,  stock  options,  restrictive  stock  awards and other  convertible
securities. All potentially dilutive shares as of December 31, 2006 and 2005, of
3,777,138,477  and  677,323,571,  respectively,  have been excluded from diluted
loss per share as the effect would be  antidilutive  for the periods then ended.
In all consolidated financial statements presented,  diluted net loss per common
share is the same as basic net loss per common share.

                                      F-9
<PAGE>

Stock-based compensation

On January 1, 2002, the Company has adopted fair value  accounting for grants of
common stock,  options and warrants to employees and non-employees in accordance
with  Statement of  Financial  Accounting  Standards  No. 123,  "Accounting  for
Stock-Based  Compensation"  (SFAS No.  123),  as amended by FAS 148 and Emerging
Issues Task Force  Issue  96-18,  "Accounting  for Equity  Instruments  That Are
Issued to Other Than  Employees for Acquiring,  or in Conjunction  with Selling,
Goods or Services" (EITF 96-18). The compensation expense is recognized over the
vesting  period.  All  options  granted  by the  Company  prior  to 2005  vested
immediately  and  compensation  expense  was  recognized  in the period of grant
(refer to Notes 18 and 19).

The Company  adopted  Statement  of  Financial  Accounting  Standards  No. 123R,
"Share-based  Payment"  ("SFAS  123R") on  January  1, 2006  using the  modified
prospective method. SFAS 123R supersedes Accounting Principles Board Opinion No.
25,   "Accounting   for  Stock   Issued  to   Employees"   ("APB  25")  and  its
interpretations   and  revises  SFAS  No.  123,   "Accounting   for  Stock-based
Compensation"  ("SFAS  123") and requires all  share-based  payments,  including
grants of employee stock options,  to be recognized in the financial  statements
based on their fair values.  Under SFAS 123R,  the Company  measures the cost of
services  received in exchange for stock options and similar awards based on the
grant-date  fair  value of the award  and  recognizes  this  cost in the  income
statement over the period during which an award recipient is required to provide
service in exchange for the award. The Company uses the  Black-Scholes  model to
assess the fair value of  share-based  payments and amortizes this cost over the
service period.

There have been no stock options granted, exercised or expired in 2006 and 2005.

Discount on debt

The  Company  has  allocated  the  proceeds   received  from   convertible  debt
instruments  between the underlying debt  instruments and the warrants,  and has
recorded the conversion  feature as a liability in accordance with SFAS No. 133,
"Accounting for Derivative  Instruments and Hedging Activities" ("SFAS 133") and
related interpretations.  The conversion feature and certain other features that
are considered embedded derivative instruments, such as a variable interest rate
feature, a conversion reset provision and redemption option,  have been recorded
at their  fair  value  within  the  terms of SFAS 133 as its fair  value  can be
separated  from the  convertible  note and its  conversion is independent of the
underlying  note  value.  The  conversion  liability  is marked  to market  each
reporting  period with the resulting  gains or losses shown on the  consolidated
statement of operations. For debt instruments having conversion features whereby
the holder can convert at anytime,  the deferred  charge is recorded as interest
expense in the period proceeds are received.

Financial instruments

The Company evaluates its convertible debt, options, warrants or other contracts
to  determine  if those  contracts  or embedded  components  of those  contracts
qualify  as  derivatives  to be  separately  accounted  for under  Statement  of
Financial  Accounting  Standards 133 "Accounting for Derivative  Instruments and
Hedging Activities" and related interpretations including EITF 00-19 "Accounting
for Derivative  Financial  Instruments Indexed to, and Potentially Settled in, a
Company's Own Stock".  The result of this accounting  treatment is that the fair
value of the embedded derivative is marked-to-market each balance sheet date and
recorded  as a  liability.  In the event  that the fair value is  recorded  as a
liability, the change in fair value is recorded in the consolidated statement of
operations  as other  income  or  expense.  Upon  conversion  or  exercise  of a
derivative instrument,  the instrument is marked to fair value at the conversion
date and then that fair value is reclassified to equity.

                                      F-10
<PAGE>

In  circumstances   where  the  embedded  conversion  option  in  a  convertible
instrument  is  required  to be  bifurcated  and there are also  other  embedded
derivative  instruments in the  convertible  instrument  that are required to be
bifurcated, the bifurcated derivative instruments are accounted for as a single,
compound derivative instrument.

The classification of derivative instruments, including whether such instruments
should be recorded as  liabilities  or as equity,  is  re-assessed at the end of
each  reporting  period.  Equity  instruments  that are initially  classified as
equity that become subject to  reclassification  under SFAS 133 are reclassified
to liability at the fair value of the instrument on the  reclassification  date.
Derivative instrument liabilities are classified in the balance sheet as current
or  non-current  based on whether or not net-cash  settlement of the  derivative
instrument is expected within 12 months of the balance sheet date.


NOTE 4 - PROPERTY, PLANT AND EQUIPMENT

The components of property, plant and equipment consists of the following:

                                                     December 31,
                                             ----------------------------
                                                 2006            2005
                                             ------------    ------------
Automobiles & trucks                         $    234,192    $    234,192
Machinery equipment                               370,795         328,265
Furniture & fixtures                              363,472         332,347
Computer equipment                                627,385         627,385
Leasehold improvements                            142,977         140,098
                                             ------------    ------------
                                                1,738,821       1,662,287
Less accumulated depreciation
  and amortization                              1,412,182       1,250,254
                                             ------------    ------------
Property and equipment, net                  $    326,639    $    412,033
                                             ============    ============

Depreciation expense for the years ended December 31, 2006 and 2005 was $161,927
and $246,031, respectively. In addition $75,206 of depreciation and amortization
on assets under capital leases have been included in depreciation expense.


NOTE 5 - BUSINESS ACQUISITIONS

Nuclear Material Detection Technologies, Inc.

In December 2006, the Company acquired Nuclear Material Detection  Technologies,
Inc.  ("NMDT"),  a  wholly-owned  subsidiary of UTEK  Corporation  in a tax-free
stock-for-stock  exchange.  The Company issued 168,539,326  restricted shares of
the its common stock valued at $1,516,854, based on the fair market value of the
Company's common stock at the date of issuance,  to UTEK Corporation in exchange
for 100% of the issued and outstanding shares of NMDT.

At the time of  acquisition  NMDT had no employees,  operations or  liabilities.
NMDT's  only assets  include  approximately  $200,000  in cash and an  exclusive
license to a patented  technology  known as RadRope(TM) with a 19 year life. The
purchase price is allocated as follows:

                                      F-11
<PAGE>

Assets
------

Cash                                         $         200,000

RadRope(TM) license                                  1,316,854

Total liabilities                                           --
                                             -----------------

Net Assets                                   $       1,516,854
                                             =================


NMDT  holds  a  license  to  a  patented  portable  nuclear  material  detecting
technology.  NMDT is an organization  whose primary business  application is the
detection  of  radiation  in the  logistics,  transportation  and general  cargo
industry.  The current security  environment within the transportation  industry
makes NMDT not just a complementary portion of the business, but one that in the
near future may become a requirement for the transportation  industry. Using the
product that NMDT will license or produce,  called  RadRope(TM),  inspectors can
rapidly detect the presence of nuclear  material in a sealed  container  without
the use of harmful  x-rays.  The Agreement for the patent  license has a royalty
provision  for the  inventor at a rate of 7% of net sales of licensed  products,
except for any non-United States  governmental  sales of the product.  There are
minimum  annual  royalty  fees to be paid  beginning  in the second  year of the
license agreement and range from $5,000 in year 2 to $30,000 in year 5.


NOTE 6 - GOING CONCERN

The accompanying consolidated financial statements have been prepared on a basis
which contemplates the realization of assets and the satisfaction of liabilities
and  commitments  in the normal course of business.  The Company  incurred a net
loss  attributable  to  common  stockholders  of  approximately  $5,865,000  and
$4,527,000 for the years ended December 31, 2006 and 2005, respectively, and has
a working capital  deficiency of  approximately  $8,509,000 at December 31, 2006
and a stockholders' deficit of approximately $8,522,000 at December 31, 2006 and
expects that it will incur additional  losses in the immediate  future.  To date
the  Company  has  financed  operations  primarily  through  sales of its equity
securities and issuance of debt  instruments  to related and unrelated  parties.
Its ability to continue as a going concern is dependent  upon the ability of the
Company to  generate  profitable  operations  in the  future,  raise  additional
capital  through the issuance of debt and sale of its common or preferred  stock
and/or to obtain the necessary  financing to meet its  obligations and repay its
liabilities arising from normal business operations when they come due. Although
management  continues  to pursue these  plans,  there is no  assurance  that the
Company will be  successful  in obtaining  financing on terms  acceptable to the
Company.  The outcome of these matters cannot be predicted with any certainty at
this time.

These factors raise  substantial  doubt that the company may be able to continue
as a going concern.  These consolidated  financial statements do not include any
adjustments to the amounts and classification of assets and liabilities that may
be necessary should the Company be unable to continue as a going concern.

The audit report prepared by our independent  registered  public accounting firm
relating to our  consolidated  financial  statements for the year ended December
31, 2006 includes an  explanatory  paragraph  expressing the  substantial  doubt
about our ability to continue as a going concern.

                                      F-12
<PAGE>

NOTE 7 - RECENT ACCOUNTING PRONOUNCEMENTS

In July 2006, the Financial  Accounting  Standards  Board  ("FASB")  issued FASB
Interpretation  No.  48,  "Accounting  for  Uncertainty  in  Income  Taxes",  an
Interpretation  of FASB  Statement  No. 109,  ("FIN 48").  FIN 48  prescribes  a
recognition  threshold and  measurement  attribute  for the financial  statement
recognition and  measurement of tax position taken in a tax return.  The Company
must determine whether it is "more-likely-than-not"  that a tax position will be
sustained  upon  examination,  including  resolution  of any related  appeals or
litigation processes,  based on the technical merits of the position. Once it is
determined that a position meets the more-likely-than-not recognition threshold,
the position is measured to determine  the amount of benefit to recognize in the
financial  statements.  FIN 48  applies to all tax  positions  related to income
taxes subject to FASB  Statement No. 109,  "Accounting  for Income  Taxes".  The
interpretation  clearly excludes income tax positions  related to FASB Statement
No. 5, "Accounting for Contingencies".  The Company will adopt the provisions of
this statement  beginning the first quarter of 2007. The adoption of FIN 48 will
not have a material impact on our consolidated  financial  position or result of
operations.

In September 2006, the FASB issued Statement of Financial  Accounting  Standards
("FAS") No. 157, "Fair Value  Measurements"  ("FAS 157").  FAS 157 establishes a
common definition for fair value under accounting  principles generally accepted
in the United States of America ("GAAP"),  establishes a framework for measuring
fair  value  and  expands   disclosure   requirements   about  such  fair  value
measurements. FAS 157 is effective for fiscal years beginning after November 15,
2007. The Company does not expect the adoption of this  pronouncement  to have a
material impact on our consolidated financial position or results of operations.

Additionally in September 2006, the Securities and Exchange  Commission  ("SEC")
issued Staff Accounting Bulletin No. 108, "Considering the Effects of Prior Year
Misstatements   when   Quantifying   Misstatements  in  Current  Year  Financial
Statements"  (SAB 108").  SAB 108 is effective for us beginning  with our fiscal
year ended on December 31, 2007. The Company does not expect SAB 108 will have a
material effect on our consolidated financial position or results of operation.


NOTE 8 - FACTORING FACILITIES

Cargo  Connection  Logistics Corp. has an agreement with a factor which provides
an  accounts  receivable  factoring  facility  by  purchasing  certain  accounts
receivable and extending  credit with a maximum  borrowing amount of $2,000,000.
The contract  automatically  renews  annually unless Cargo  Connection  provides
thirty (30) days  cancellation  notice.  The agreement  provides that the factor
will  purchase up to 90% of eligible  accounts  receivable  of Cargo  Connection
minus a discount of approximately 1.5902% and a discretionary reserve (holdback)
which is reduced with payments from the individual accounts receivable debtors.

If an invoice is  outstanding  over 90 days,  Cargo  Connection,  under recourse
provisions,  must buy back the invoice from the factor.  Cargo  Connection  must
submit a minimum of $1,500,000 of eligible invoices in any calendar quarter.  At
December 31, 2006,  $351,924 is due from the factor which represents the reserve
against  submitted  invoices.  The  escrow  being  held by the  factor  totaling
$361,846  represents  funds  available  to assist  Cargo  Connection  in funding
payments to its transportation  carriers.  This is mainly due to the concerns of
the Factor as to  potential  defaulted  payments  by the  Company to its outside
transportation  vendors to ensure  that these funds are not  diverted  for other
uses.  At  December  31,  2006,  the total  amount  advanced  by the  factor was
$1,488,187  which  represents the proceeds of financing of accounts  receivables
sold.

                                      F-13
<PAGE>

NOTE 9 - CONVERTIBLE NOTES PAYABLE

The Company was obligated  under various Series A convertible  promissory  notes
payable to four entities  totaling $514,502 as of December 31, 2005. These notes
were due December 31, 2004 and were  considered  payable on demand.  These notes
were interest  bearing at a rate of 6.5% and were convertible into shares of the
Company's  common stock with a conversion price per share equal to the lesser of
the average of the lowest of three day trading  prices  during the five  trading
days immediately  prior to the conversion date multiplied by .80 or, the average
of the  lowest  of three  day  trading  prices  during  the five  trading  dates
immediately  prior to the funding dates. All of these notes have been fully paid
or converted as of December 31, 2006.

Long-term convertible note

In April 2005,  the Company  entered  into a  Convertible  Promissory  Note to a
former Company  officer  (Goldberg Note) that was advanced to the Company in the
amount of $86,790.  The note had a 3-year term with  interest  payable only at a
rate of 8% per annum. The Company had an option on the three year anniversary of
the debenture to pay the debenture in full or convert into the Company's  shares
of common stock.  The debt discount,  due to the conversion  feature,  was being
amortized over the life of the instrument using the effective interest method.

The note has been converted into 11,637,050 shares of the company's common stock
in full payment of principal and interest as of the redemption  date of July 26,
2006 at the option of the Holder.


NOTE 10 - OBLIGATIONS UNDER CAPITAL LEASES

The  Company   leases   machinery,   equipment   and  software   under   various
non-cancelable  capital  leases  with  a  capitalized  cost  of  $734,231,  less
accumulated  amortization  of $595,841 as of December 31, 2006. The  obligations
require monthly payments,  including  interest  totaling $3,221.  Interest rates
range from 1.87% to 13.16% and the lease  obligations  mature  through August 1,
2009.  Certain lease obligations are guaranteed by certain executive officers of
the Company.

As of December 31, 2006,  the aggregate  future  minimum  annual lease  payments
under these leases are as follows:

   Years Ending
   December 31,
  ---------------
       2007                                                   $ 24,543
       2008                                                     10,263
       2009                                                      5,104
       2010                                                        -0-
                                                              --------
       Total                                                    39,910
       Less: amount representing interest                        2,876
                                                              --------
       Net present value of capital lease obligations           37,034
       Current portion                                          22,718
                                                              --------
       Long-term portion                                      $ 14,317
                                                              ========

                                      F-14
<PAGE>

NOTE 11 - DUE TO OTHERS

During  the  twelve  months  ended  December  31,  2006,  the  Company  received
non-interest  bearing cash  advances  from Mr. Ferro,  RAKJ  Holdings,  Inc. and
Triple  Crown  Consulting,  Co. to fund  current  operations  in the  amounts of
$130,000,  145,000  and  $980,000,  respectively.  The  Company  classified  the
advances as current liabilities as there is no formal agreement in place for the
repayment of these funds.  The Company is  currently  negotiating  a formal note
agreement with the lenders.

In addition,  Cargo  Connection  has entered into  insurance  premium  financing
arrangements  with two providers  with balances due to the providers of $310,209
as of December 31, 2006.

Due to Others as of December 31, 2006 consists of the following:

            Loan from Ferro                             $   130,000
            Loan from RAKJ Holdings                         145,000
            Loan from Triple Crown                          980,000
                                                        -----------
                                                        $ 1,255,000
                                                        -----------

            Due to Avalon Insurance                     $   243,701
            Due to Mepco Insurance Financing                 66,508
                                                        -----------
                                                        $   310,209
                                                        -----------

                              Total account balance     $ 1,565,209
                                                        ===========

NOTE 12 - NOTES PAYABLE

The  Company   entered  into  a  loan   agreement   with  U.S.   Small  Business
Administration  ("SBA")  whereby  the SBA loaned  $90,200  for  working  capital
purposes. The loan bears interest at a rate of 4% per annum. The loan matures in
2008,  when the  balance  due will  approximate  $14,000.  Monthly  installments
totaling  $2,664 began in June 2005.  No payments of interest or principal  were
required before that date. The Note is secured by the personal guarantees of the
officers of Cargo Connection and is also collateralized by substantially all the
assets of Cargo Connection.

The Company had a revolving  loan with HSBC Bank whereby the Company was granted
a $100,000 line of credit.  The line of credit bears interest at a rate of prime
plus 2-1/2%  (10.75% at December  31,  2006).  The Company was  required to make
monthly  interest only payments until December 15, 2006, when the line of credit
terminated. At that time the remaining balance became a note payable with a four
year  term.  The  obligation  is  collateralized  by all of the  assets of Cargo
Connection Logistics - International,  Inc. (f/k/a Mid-Coast  Management,  Inc.)
and is  guaranteed  by all of this  company's  officers.  The balance on the new
notes payable (converted from the line of credit) was $97,917 as of December 31,
2006.

The Company  entered  into a  promissory  note with  National  Semi-Trailer  for
repayment of trade payable obligations in the amount of $87,910.  The note bears
interest  at a rate of 10% per annum and is  payable in weekly  installments  of
$2,041 and was payable over 45 weeks.  The Note was to mature  November 16, 2006
and has been  extended by the Holder  under  payment  terms  presently in effect
until a renegotiated payment schedule is agreed upon by both parties. The amount
owed as of December 31, 2006 was $24,191.

                                      F-15
<PAGE>

The following table details the Notes Payable as of December 31, 2006:

            HSBC Bank                                   $ 97,917
            National Semi-Trailer                         24,191
            US-SBA                                        51,912
                                                        --------
                     Total                              $174,020
                     Less: current portion:               79,636
                     Long-term portion                  --------
                                                        $ 94,384
                                                        ========


At December 31, 2006,  future  minimum  annual  principal  payments on the above
notes are as follows:

            Twelve Months
            Ending December 31,
            -------------------
            2007                               $  79,636
            2008                                  46,467
            2009                                  25,000
            2010                                  22,917
                                               ---------
                                               $ 174,020
                                               =========

NOTE 13 - SECURED CONVERTIBLE DEBENTURES

In October 2005, the Company entered into a secured  convertible  debenture with
members of management in the amount of $75,000.  Under the agreement the Company
issued a $75,000 secured  convertible  debenture with a 15% interest rate to the
group with a maturity date of September 30, 2006.  The debenture is  convertible
after into  common  shares of the  Company at a  conversion  price  equal to the
lesser of (a) $0.005 per share or (b) seventy five  percent  (75%) of the lowest
Closing Bid Price of the Common Stock of the five (5) trading  days  immediately
preceding the Conversion date. The Company has received no notification  that it
is in default under the provisions of the note.

This Note is a hybrid instrument which contains an embedded  derivative  feature
which would individually require separate accounting as a derivative  instrument
under SFAS No. 133. The  embedded  derivative  feature have has been  bifurcated
from the debt host contract,  referred to as the "Compound  Embedded  Derivative
Liability".  The embedded  derivative  feature  includes the conversion  feature
within  the note and an  early  redemption  option.  The  value of the  embedded
derivative  liability was bifurcated from the debt host contract and recorded as
a derivative  liability,  which resulted in a reduction of the initial  carrying
amount (as  unamortized  discount)  of the notes.  The  unamortized  discount is
amortized to interest expense using the effective  interest method over the life
of the notes. The unamortized  discount amount is $-0- at December 31, 2006. The
Holders of this note have informally  agreed to extend the due date of this Note
to September 30, 2007.

The note is presently stated on a net to fair value basis.

            Convertible Note - Management               $    75,000
            Discount on Note                                    -0-
                                                        -----------
                                                        $    75,000
                                                        ===========

                                      F-16
<PAGE>

On December 29, 2005, the Company completed a financing agreement for $1,750,000
with  Montgomery.  Under the agreement the Company  issued a $1,750,000  secured
convertible  debenture  with a 10% interest rate to  Montgomery  with a maturity
date of December 28, 2007.  The  debenture is  convertible  after that date into
common  shares of the Company at a  conversion  price equal to the lesser of (a)
$0.0025 per share or (b) seventy  five percent  (75%) of the lowest  Closing Bid
Price of the Common Stock of the ten (10) trading days immediately preceding the
Conversion  date. The Company  simultaneously  issued to Montgomery a three year
Warrant  to  purchase  2,000,000  Shares  of the  Company's  common  stock at an
exercise  price  of  $0.001.  The  Company  had  committed  to  filing  an  SB-2
Registration Statement with the SEC no later than forty-five (45) days from date
of  funding.  The  Company  can be  held in  default  if the  SB-2  Registration
Statement  does not become  effective  within 150 days of filing the  statement.
There are  penalty  provisions  for the  Company  should  the  filing not become
effective  within  120  days of  filing  an  SB-2  Registration  Statement.  The
debenture is secured by the assets of the Company.  The  registration  statement
was filed in February 2006. An amended registration  statement was filed in July
2006. The statement has not yet become effective.  If the Company is found to be
in default under this  agreement,  the full  principal  amount of the debenture,
together with interest and other amounts owing,  may become  immediately due and
payable. To date, the Company has received no notification that it is in default
under the provisions of the note.

The Montgomery  Note is a hybrid  instrument  which  contains both  freestanding
derivative  financial  instruments and more than one embedded derivative feature
which would individually warrant separate accounting as a derivative  instrument
under SFAS No. 133. The freestanding  derivative  financial  instruments include
the warrant,  which was valued individually,  and totaled $1,857,752 at the date
of  inception.  The  various  embedded  derivative  features  have been  bundled
together as a single,  compound  embedded  derivative  instrument  that has been
bifurcated  from the debt host contract,  referred to as the "Compound  Embedded
Derivative Liability".  The single compound embedded derivative features include
the conversion feature within the notes, the conversion reset feature, the early
redemption  option and the interest  rate  adjustments.  The value of the single
compound  embedded  derivative  liability  was  bifurcated  from the  debt  host
contract and recorded as a derivative  liability,  which resulted in a reduction
of the initial  carrying  amount (as  unamortized  discount)  of the notes.  The
unamortized  discount is  amortized  to  interest  expense  using the  effective
interest  method  over the life of the  notes,  or 24  months.  The  unamortized
discount and the effect of this  transaction has been included with the February
13, 2006 financing agreement.

The Company has classified the Montgomery warrants as liabilities and associated
interest expenses  effective  December 29, 2005 to reflect that the registration
rights  agreement into which the Company entered in connection with its issuance
of the warrants  requires the Company to pay liquidated  damages,  which in some
cases could exceed a reasonable discount for delivering  unregistered shares and
thus would  require the  warrants  to be  classified  as a  liability  until the
earlier of the date the warrants are  exercised or expire.  In  accordance  with
EITF 00-19, the Company has allocated a portion of the offering  proceeds to the
warrants  based on their fair value.  EITF 00-19 also  requires that the Company
revalue the  warrants as a  derivative  instrument  periodically  to compute the
value in  connection  with  changes  in the  underlying  stock  price  and other
assumptions, with the change in value recorded as other expense or other income.

In conjunction with the Montgomery  Convertible Note,  Montgomery was paid a fee
of $135,000 in December 2005,  and received a three-year  warrant to purchase up
to  2,000,000  shares of the  Company's  common  stock at a price of $0.001  per
share. The warrant, which is exercisable  immediately,  was valued at $2,394,000
using a  Black-Scholes  option pricing  model.  The value of the warrant and the
fees paid to  Montgomery  were  recorded as a discount to the note and are being
amortized over the term of the loan using the effective interest method.

                                      F-17
<PAGE>

On February 13, 2006, the Company  completed a financing  agreement for $600,000
with  Montgomery.  Under the  agreement  the Company  issued a $600,000  secured
convertible  debenture  with a 10% interest rate to  Montgomery  with a maturity
date of February 13, 2008.  The  debenture is  convertible  after that date into
common  shares of the Company at a  conversion  price equal to the lesser of (a)
$0.0025 per share or (b) seventy  five percent  (75%) of the lowest  Closing Bid
Price of the Common Stock of the ten (10) trading days immediately preceding the
Conversion  date.  This Note was part of the funding package entered into by the
Company with  Montgomery  on December 29, 2005. As part of that  agreement,  the
Company had committed to filing an SB-2  Registration  Statement with the SEC no
later than forty-five (45) days from date of funding. The registration statement
was filed in February  2006 by the  Company.  The  statement  has not yet become
effective.  As part of the December 29, 2005 agreement,  the Company was able to
obtain an  additional  $600,000  from  Montgomery  under  the same  terms of the
December  29,  2005  Note.  The  Company  can be held  in  default  if the  SB-2
Registration  Statement does not become  effective within 150 days of filing the
statement.  There are penalty  provisions  for the Company should the filing not
become effective within 120 days of filing an SB-2  Registration  Statement.  If
the Company is found to be in default under this  agreement,  the full principal
amount of the  debenture,  together with interest and other amounts  owing,  may
become  immediately  due and payable.  The debenture is secured by the assets of
the Company.

This above Note is a hybrid  instrument  which  contains an embedded  derivative
feature which would  individually  warrant  separate  accounting as a derivative
instrument under SFAS No. 133. The freestanding derivative financial instruments
include the warrant,  which was valued  individually,  and totaled $1,090,902 at
the date of inception.  The embedded derivative feature has been bifurcated from
the  debt  host  contract,  referred  to as the  "Compound  Embedded  Derivative
Liability".  The embedded  derivative  feature  includes the conversion  feature
within  the note and an  early  redemption  option.  The  value of the  embedded
derivative  liability was bifurcated from the debt host contract and recorded as
a derivative  liability,  which resulted in a reduction of the initial  carrying
amount (as  unamortized  discount)  of the notes.  The  unamortized  discount is
amortized to interest expense using the effective  interest method over the life
of the notes,  or 24 months.  The  unamortized  discount amount is $1,676,276 at
December 31, 2006.

The note, in its entirety, is presently stated on a net to fair value basis.

            Secured Convertible Debenture - Montgomery  $   2,250,000
            Discount on Note                               (1,676,276)
                                                        -------------
                                                        $     573,724
                                                        =============

NOTE 14 - FINANCIAL INSTRUMENTS ("Compound Embedded Derivative Liability")

The  effect  of the mark to market  adjustments  associated  with the  financial
instruments  for the twelve month period  ending  December 31, 2006  generated a
loss of $817,591  associated  with the market  price  adjustment.  In  addition,
interest expense associated with the derivative  financial  instruments  totaled
$1,458,935 for twelve month period ended December 31, 2006.

The  following  table details the  liability  for  financial  instruments  as of
December 31, 2006.  It reflects the twelve  month  transactions  reflecting  the
addition of the financial  instrument  liability from the additional  traunch of
funds received from Montgomery (see Note 12) on February 13, 2006 as well as the
mark to market adjustments as December 31, 2006.

                                      F-18
<PAGE>

<TABLE>
<CAPTION>
                         Opening                                              Ending
                         Balance                                   Mark      Balance
                          2006         Additions  Adjustments   to market      2006
                       ------------  -----------  -----------   ---------   ----------
<C>                    <C>           <C>          <C>           <C>         <C>
6.5% Series A Notes    $    128,626  $        --  $   (12,500)  $(116,126)  $       --
Goldberg Note                86,909           --      (85,527)     (1,382)          --
Highgate Warrants               459           --           --       (459)           --
Management Note              69,442           --           --      73,448      142,890
Montgomery Note           1,863,534    1,090,902     (193,558)    854,534    3,615,412
Montgomery Warrants           3,783           --           --       7,576       11,359
                       ------------  -----------  -----------   ---------   ----------
Total Financial
 Instrument Liability  $  2,152,753  $ 1,090,902  $  (291,585)  $ 817,591   $3,769,661
                       ============  ===========  ===========   =========   ==========
</TABLE>

NOTE 15 - EMPLOYEE BENEFIT PLAN

The Company maintains a 401(k) savings plan that covers substantially all of its
employees. Participants in the savings plan may elect to contribute, on a pretax
basis, a certain percentage of their salary to the plan. Presently,  the Company
does  not  match  any  portion  of the  participant's  contributions  as per the
provisions of the plan.

NOTE 16 - ACCRUED EXPENSES

Accrued expenses as of December 31, 2006 consist of the following:

            Salaries                                    $ 432,804
            Interest                                      262,631
            Other                                             -0-
                                                        ---------
                                                        $ 695,435
                                                        =========

NOTE 17 - COMMITMENTS AND CONTINGENCIES

Lease Commitments

The Companies has entered into  non-cancelable  operating leases for offices and
warehouse space in several States including  Illinois,  New York, Ohio,  Florida
and  Georgia.  Additionally,  the  Companies  lease  equipment  and trucks under
non-cancelable  operating  leases.  The leases are subject to escalation for the
Companies'  proportionate  share of  increases  in real estate taxes and certain
other  operating   expenses.   The  approximate  future  minimum  rentals  under
non-cancelable operating leases in effect on December 31, 2006, are as follows:

                        Office and                        Equipment
                        Warehouse Space                  and Trucks
                        ---------------                 ------------
            2007        $     1,655,441                 $    113,977
            2008              1,620,166                      115,688
            2009              1,510,062                      117,423
            2010              1,342,179                       89,055
            2011              1,301,316                          -0-
            Thereafter        3,446,422                          -0-
                        ---------------                 ------------
                        $    10,875,586                 $    436,144
                        ===============                 ============

                                      F-19
<PAGE>

Rent expense  (inclusive of  amortization  of straight line expense)  charged to
operations  for office and warehouse  space for the twelve months ended December
31, 2006, and 2005 amounted to $1,311,112 and $1,698,881 respectively.  See Note
20 for rent expense paid to related entities. Rent expense charged to operations
for trucks and equipment for the years ended December 31, 2006 and 2005 amounted
to $550,964 and $528,835, respectively.

Litigation

On or about  November 17, 2006,  Daniel Murray  ("Murray"),  a former  employee,
filed a  Complaint  against  the  Company  asking for  damages  for  alleged age
discrimination,  fraudulent  inducement,  breach of contract  and other forms of
discrimination under Daniel Murray v. Cargo Connection Logistics Holding,  Inc.,
case No. 19405-06 (Supreme Court of the State of New York,  Nassau County,  NY).
Murray seeks  damages  equal to the annual  salary  contained in the  employment
agreement of $150,000 per year for five years or $750,000. The Company has since
filed a Motion to Dismiss all causes of action other than the breach of contract
claim. This motion was fully submitted on February 15, 2007. Management believes
that the  Company  has  meritorious  defenses  to this  claim and is  vigorously
contesting the case.

On or about  November 10, 2006,  One Rason Road Joint  Venture,  Inc.  ("Rason")
filed a complaint  against Cargo Connection  Logistics Corp.  seeking damages in
the amount of $282,672 for alleged lease  payments for a non-owned,  non-related
or non-affiliated  company,  Airfreight Management Group, Inc. in One Rason Road
Joint  Venture v.  Airfreight  Management  Group,  Inc.  n/k/a Cargo  Connection
Logistics  Corporation,  case 06-017600 (Supreme Court of the State of New York,
County of Nassau,  NY). Rason filed the action for breach of a lease, dated July
10,  2003  between  itself  and a company  called  Airfreight  Management  Group
("AMG"),  Inc. for  premises  located at 45 Rason Road,  Inwood,  NY which lease
expires on July 31, 2008. Rason alleges that AMG vacated the premise on or about
May, 2006 and owes back rent.  Rason also alleges that AMG in now known as Cargo
Connection Logistics  Corporation and feels that the Company is liable for AMG's
debts  under the lease.  The Company has filed a Notice of Motion to dismiss the
Complaint  and is awaiting  opposition  papers from Rason.  The motion was to be
fully  submitted  on March 9, 2007.  Management  believes  that the  Company has
meritorious defenses to this claim and is vigorously contesting this matter.

On or about November 6, 2006, in an  application to the Bankruptcy  Court for an
Examination  of  Airfreight  Warehouse  Corporation  ("AFW"),  which  filed  for
Bankruptcy under Chapter XI in the US Bankruptcy Court for the Southern District
of New York,  alleges that pursuant to an agreement entered into between AFW and
the Cargo  Connection  Logistics  Corp.  ("Cargo"),  that Cargo has not paid all
funds due to AFW under the agreement in the amount of $300,000.  Management  has
complied with the request of the Trustee of the US Bankruptcy Court and believes
that the Company has acted in good faith and remitted all funds due to AFW under
the agreement.

                                      F-20
<PAGE>

On or about May,  2006,  the Company filed suit against a former  business agent
under Cargo  Connection  Logistics  Corp. v. Fleet Global  Services,  Inc., case
number  48-2006-CA-3208-0  (9th Judicial  Circuit,  Orange County,  Florida) for
breach of contract in the amount  $128,179.  The trial date is presently set for
May 8, 2007.

The Company is party to other various legal proceedings  generally incidental to
its business as is the case with other companies in the same industry.  Although
the  ultimate   disposition  of  legal  proceedings  cannot  be  predicted  with
certainty,  it is the opinion of management  that the outcome of any claim which
is pending or threatened,  either  individually or on a combined basis, will not
have a materially adverse effect on the consolidated financial statements of the
Companies.

Significant Customers

For the year ended December 31, 2006, the Company, through the broadening of its
customer  base,  had one (1) customer  that  accounted  for more than 10% of its
operating  revenue.  One customer  accounted for  approximately 21% of operating
revenue. For the year ended December 31, 2005 the Company had two (2) customers,
which comprised  approximately 28% of operating revenue. As of December 31, 2006
these  customers  accounted  for  $410,148 of the  Company's  factored  accounts
receivable.

NOTE 18 - STOCKHOLDERS' DEFICIT

Issuance of Stock for Services

The Company had retained a financial  advisory firm as a business  consultant to
assist in a variety  of areas  relating  to  financial,  strategic  and  related
developmental growth of the Company requiring monthly payments of $10,000 to the
advisory firm. The fees were earned on a monthly basis and paid to the financial
advisory firm in fully vested common shares through December, 2005. The fees for
2006 were paid in cash. The relationship  with this financial  advisory firm was
terminated on February 28, 2006 and there have been no further transactions.

The Company retained the services of a consulting group to assist the Company in
a variety of areas relating to international and foreign affairs issues at a fee
of $250,000. The Company issued 25,000,000 shares of its restricted common stock
for the services  rendered to the Company in March,  2006 and the recognition of
the expense was immediate, in accordance with EITF-0018.

The  Company  retained  an advisor  to assist the  Company in a variety of areas
relating to international and domestic legal and financial  issues.  The Company
entered  into a yearly  retainer of $75,000 for these  services  which began May
2006.  The  Company  subsequently  paid the advisor in  7,142,857  shares of the
Company's restricted common stock, which are nonforfeitable, and the recognition
of the expense was immediate, in December, 2006, in accordance with EITF-0018.

The Company  retained a technology  advisory firm in August,  2006 as a business
consultant to assist in a variety of areas  relating to technology and growth in
technology  that  complements  the  Company's  businesses.   The  fee  for  this
consultant  is $120,000  for the year and was paid in August,  2006  through the
issuance  of  4,838,710  shares  of  the  Company's  common  stock,   which  are
nonforfeitable,  and the recognition of the expense was immediate, in accordance
with  EITF-0018.  The advisory  firm was also issued  168,539,326  shares of the
Company's  common stock valued at $1,516,854 in connection  with an  acquisition
(see note 5).

Conversion of Preferred Stock into Common Stock

                                      F-21
<PAGE>

On March 17, 2006,  180,000,000  shares of the Company's common stock was issued
to Triple Crown  Consulting,  Inc. and its assignees  based on the conversion of
35,000 shares of Series IV Convertible Preferred stock.

Conversion of Secured Debentures into Common Stock

On July 6, 2006,  8,000,000  shares of the Company's common stock were issued to
Montgomery,  based  on  the  conversion  of  $20,000  of a  convertible  secured
debenture.  Due to this conversion,  $105,600 was recorded as additional paid in
capital,  based on a  valuation  performed  in  connection  with the  derivative
instrument associated with this note.

On July 21, 2006, 32,000,000 shares of the Company's common stock were issued to
Montgomery,  based  on  the  conversion  of  $80,000  of a  convertible  secured
debenture.  Due to this conversion,  $422,400 was recorded as additional paid in
capital,  based on a  valuation  performed  in  connection  with the  derivative
instrument associated with this note.

Conversion of Convertible Promissory Notes into Common Stock

On  January  6,  2006,  we  issued  4,566,210  shares  of our  common  stock  to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On January 9, 2006, we issued  2,705,628 shares of our common stock to Advantage
Capital, based on the conversion of $5,000 of a convertible promissory note.

On January 9, 2006, we issued 4,032,258 shares of our common stock to Advantage,
based on the conversion of $10,000 of a convertible promissory note.

On  January  19,  2006,  we  issued  3,436,426  shares  of our  common  stock to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On  January  30,  2006,  we  issued  8,230,452  shares  of our  common  stock to
Advantage, based on the conversion of $20,000 of a convertible promissory note.

On January 30, 2006, we issued 3,541,666 shares of our common stock to Advantage
Capital, based on the conversion of $8,500 of a convertible promissory note.

On  January  30,  2006,  we  issued  8,230,452  shares  of our  common  stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On  February  8,  2006,  we  issued  5,249,344  shares  of our  common  stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On  February  16,  2006,  we  issued  8,264,463  shares of our  common  stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On  February  27,  2006,  we issued  11,509,993  shares of our  common  stock to
Montgomery,  based on the conversion of $20,000 of a convertible promissory note
and accrued interest.

On March 1, 2006,  we issued  3,496,503  shares of our common stock to Advantage
Capital, based on the conversion of $10,000 of a convertible promissory note.

On March 1, 2006, we issued  8,710,801  shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

On March 3, 2006, we issued  8,064,516 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

                                      F-22
<PAGE>

On March 7, 2006, we issued  6,053,269 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

On March 10, 2006, we issued  4,180,602 shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

On May 4, 2006, we issued  1,562,500  shares of our common stock to  Montgomery,
based on the conversion of $10,000 of a convertible promissory note. Due to this
conversion,  $21,875 was  recorded  as  additional  paid in capital,  based on a
valuation performed in connection with the derivative instrument associated with
this note.

On July 25, 2006, 11,637,050 shares of the Company's common stock were issued to
David Goldberg,  based on the conversion of $86,790 of a convertible  promissory
note and  accrued  interest  of $8,750.  Due to this  conversion,  $274,635  was
recorded as  additional  paid in  capital,  based on a  valuation  performed  in
connection with the derivative instrument associated with this note.

Preferred Stock

The Company is authorized to issue 2,000,000 share of preferred stock, $1.00 par
value per share,  and currently  has  designated  the  preferred  stock into the
following Series:

o     Series III: The Company amended its articles of incorporation in November
      2006 and authorized 500,000 shares of Blank Check Series III Preferred
      Stock ("Series III") at $1.00 par value. The shares of Preferred Stock may
      be issued in one or more series, and each series shall be so designated as
      to distinguish the shares from the shares of all other series. The Board
      of Directors fix the provisions before the issuance of any shares of a
      particular series. As to the number, designation, and relative rights,
      preferences and limitations of the shares of such series including (1)
      voting rights, if any, which may include the right to vote together as a
      single class with the Common Stock and any other series of the Preferred
      Stock with the number of votes per share accorded to shares of such series
      being the same as or different from that accorded to such other shares,
      (2) the dividend rate per annum, if any, and the terms and conditions
      pertaining to dividends and whether such dividends shall be cumulative,
      (3) the amount or amounts payable upon such voluntary or involuntary
      liquidation, (4) the redemption price or prices, if any, and the terms and
      conditions of the redemption, (5) sinking fund provisions, if any for the
      redemption or purchase of such shares, (6) the terms and conditions on
      which such shares are convertible, in the event the shares are to have
      conversion rights, and (7) any other rights, preferences and limitations
      pertaining to such series which may be fixed by the Corporation's Board of
      Directors pursuant to the Florida Business Corporation Act.

      o     The Company is authorized to issue 500,000 shares of Series III
            preferred stock, $1.00 par value per share, of which 265,000 shares
            are issued and outstanding at December 31, 2006.

o     Series IV: The Company amended its articles of incorporation in September,
      2003 and January, 2006 and increased to 600,000 shares its Series IV
      convertible Preferred Stock ("Series IV"), $1.00 par value. Such shares
      are based on a convertible promissory note entered into between the
      Corporation and Triple Crown Consulting, Inc. Each share of the Series IV
      preferred stock is convertible into shares of the Company's common stock.
      Each holder of the Series IV preferred stock has twenty times that number
      of votes on all matters submitted to shareholders that is equal to the
      number of shares of common stock into which such holder's shares of Series
      IV preferred stock are then convertible. In addition, the holders of the
      Series IV preferred stock are entitled to receive noncumulative cash
      dividends at an annual dividend rate as determined by the Board of
      Directors. The Series IV preferred stock has a liquidation price of $1.00
      per share in the event of any liquidation, dissolution or winding up of
      the Company, whether voluntary or involuntary. The Company's articles of
      incorporation state that, at the option of the Holder, the Series IV
      preferred stock will be convertible into the Company's common stock at a
      conversion price equal to the lesser of (i) the average of the lowest of
      three-day trading prices during the five trading days immediately prior to
      the Conversion Date multiplied by .70, or (ii) the average of the lowest
      of three-day trading prices during the five trading days immediately prior
      to the funding date(s).

                                      F-23
<PAGE>

      o     The Company is authorized to issue 600,000 shares of class IV
            preferred stock, $1.00 par value per share, of which 517,500 shares
            are issued and outstanding at December 31, 2006.

o     Series V: The Company amended its articles of incorporation in November,
      2006 and authorized 500,000 shares of Series V Preferred Stock ("Series
      V") at a par value of $1.00 per share. Series V were issued based on the
      Stock Purchase Agreement and Share Exchange entered into on May 12, 2005
      between the Company and the shareholders of Cargo Connection Logistics
      Corp and Cargo Connection Logistics - International, Inc. (f/k/a Mid-Coast
      Management, Inc.) which called for additional consideration to be given to
      the shareholders of Cargo Connection Logistics Corp. and Cargo Connection
      Logistics - International, Inc. The Company was to issue shares of its
      preferred stock which are convertible into common stock of Cargo
      Connection Logistics Holding, Inc. within twelve (12) months from the
      closing date of the this transaction so that Cargo Connection Logistics
      Corp. and Cargo Connection Logistics - International, Inc. will own eighty
      percent (80%) of the outstanding shares of the Company at that time. Each
      share of the Series V preferred stock is convertible into shares of the
      Company's common stock. Each holder of the Series V preferred stock has a
      number of votes on all matters submitted to shareholders that is equal to
      the number of shares of common stock into which such holder's shares of
      Series V preferred stock are then convertible. Each share of Series V
      Preferred Stock is convertible into 7,575 shares of Common Stock. In
      addition, the holders of the Series V preferred stock are entitled to
      receive noncumulative cash dividends at an annual dividend rate as
      determined by the Board of Directors. In the event of any liquidation,
      dissolution or winding up of the Company, whether voluntary or
      involuntary, the Company's articles of incorporation state that, the
      holders of the Series V Preferred Stock then outstanding shall be entitled
      to receive out of the assets of the Corporation, whether from capital or
      from earnings available for distribution to its stockholders, before any
      amount shall be paid to the holders of common stock.

      o     The Company is authorized to issue 500,000 shares of class V
            preferred stock, $1.00 par value per share, of which 479,867 shares
            are issued and outstanding at December 31, 2006.

The Company has determined  that it is treating all three of the above series of
preferred  stock  issuances  on the  balance  sheet as  mezzanine  financing  in
accordance with the guidelines set forth under EITF D-98. This is required since
there are  liquidation  preferences  to be paid from  capital  or from  earnings
available for distribution to its stockholders,  before any amount shall be paid
to the  holders  of  common  stock  in the  event  of any  liquidation,  whether
voluntary or involuntary.

                                      F-24
<PAGE>

NOTE 19 - STOCK OPTION PLANS

                              STOCK INCENTIVE PLANS

In August 1999, the Company's stockholders approved the adoption of an Incentive
Stock Option Plan ("1999 Option  Plan"),  which allows the Board of Directors to
grant  options to  employees  and  members of the Board of  Directors.  The 1999
Option  Plan  provided  the Board of  Directors  the right to grant  options  to
purchase  up to a total of 100,000  shares of the  Company's  common  stock.  On
August 17, 2000,  with the  approval of the  shareholders  of the  Company,  the
number  of  shares  available  under  the  1999  Option  Plan was  increased  to
1,000,000.  As of December 31, 2006,  220,000 options were outstanding under the
1999 Option Plan.  During the year ended  December 31, 2006, the Company did not
issue any shares of its common stock under non-plan  options in lieu of granting
options.   As  of  December  31,  2006,   there  are  100,000  non-plan  options
outstanding.

The following  information  summarizes  the Company's  stock option  activity at
December 31, 2006:

Stock Options Plans:

                                        Weighted
                                         Average
                                        Exercise
                                         Options           Price
                                      -----------       ------------
Outstanding at December 31, 2004          220,000             $ 1.07

Granted                                        --                 --
Exercised                                      --                 --
Expired or cancelled                           --                 --
                                      -----------       ------------
Outstanding at December 31, 2005          220,000             $ 1.07

Granted                                        --                 --
Exercised                                      --                 --
Expired or cancelled                           --                 --
                                      -----------       ------------
Outstanding at December 31, 2006          220,000             $ 1.07
                                      ===========       ============

Non-plan stock options:
                                        Weighted
                                        Average
                                        Exercise
                                        Options           Price
                                      -----------       ----------
Outstanding at December 31, 2004        1,289,810       $      .46

Granted                                   100,000              .03
Exercised                                      --               --
Expired or cancelled                      889,810              .61
                                      -----------       ----------
Outstanding at December 31, 2005          500,000       $      .07

Granted                                        --               --
Exercised                                      --               --
Expired or cancelled                      400,000              .16
                                      -----------       ----------
Outstanding at December 31, 2006          100,000       $      .03
                                      ===========       ==========

                                      F-25
<PAGE>

The following table summarizes information about stock options outstanding and
exercisable at December 31, 2006

                                                             Outstanding and
                                                               exercisable
                                                        ------------------------
                                                        Weighted
                                                         Average     Weighted
                                                        Remaining    Average
                            Number          Life         Exercise     Number
                         Outstanding      In Years        Price     Exercisable
                        --------------  ------------    ---------   ------------
Range of exercise price:
 $ .001 to $.50                100,000          0.25         0.03       100,000
 $ .51 to $1.00                     --            --           --            --
 $ 1.01 to $1.50               220,000          2.71         1.07       220,000
                        --------------                              ------------
                               320,000                                  320,000
                        ==============                              ============

NOTE 20 - RELATED PARTY TRANSACTIONS

The  Company is due amounts  from an officer in the amount of $30,500,  which is
included  in  these  consolidated  financial  statements.   This  receivable  is
non-interest  bearing  and does  not have  formal  repayment  terms.  Management
anticipates full collection of these amounts within a one-year period.

The Company owes amounts to officers in the amount of $57,011 and other  related
entities which are not included in these consolidated financial statements,  but
which are controlled by the Company's  stockholders.  The total amount currently
due to the related party entities is $1,163,387 and are non-interest bearing and
bear no formal repayment terms.

The Company rents warehouse space and equipment from related  entities.  For the
twelve  months  ended  December  31, 2006,  and 2005,  rent  expense  charged to
operations related to these rentals totaled approximately  $909,912 and $803,524
respectively.  The leases contain various options for extending and terminate in
February 2014.

The Company and its related parties are guaranteeing a lease for a 92,000 square
foot facility  located in  Bensenville,  Illinois for  Underwing  International.
There  is  $495,000  in  other  expenses  booked  as of  December  31,  2006 for
guaranteed rental expense on the Company's statement of operations.


Cargo Connection Logistics Corp. and Cargo Connection Logistics - International,
Inc.  (f/k/a  Mid-Coast  Management,  Inc.),  the  Company's  two  wholly  owned
subsidiaries,  have had transactions with a related party. The transactions were
with CDI  Management,  Inc.,  which is  controlled  by  Jesse  Dobrinsky,  Scott
Goodman,  John L. Udell and Jay Finkelstein.  Messrs.  Dobrinsky and Goodman are
officers, directors and shareholders of our Company. Mr. Udell is an officer and
shareholder of our Company. Mr. Finkelstein is a shareholder of our Company. CDI
furnished  both  rental  property  and  equipment  leases  for Cargo  Connection
Logistics Corp. The transactions for the past three years were:

Year                    Rental Property                 Equipment Leases
--------------------------------------------------------------------------------
2006                    $ 516,825                       $ 28,800
2005                    $ 500,420                       $ 28,800
2004                    $ 461,680                       $ 28,800

                                      F-26
<PAGE>

Cargo Connection  Logistics Corp. has had transactions with a related party. The
transactions  were with Underwing  International,  LLC.,  which is controlled by
Jesse  Dobrinsky,  Scott  Goodman,  John L. Udell and Jay  Finkelstein.  Messrs.
Dobrinsky and Goodman are officers,  directors and  shareholders of our Company.
Mr. Udell is an officer and  shareholder  of our Company.  Mr.  Finkelstein is a
shareholder  of our  Company.  Underwing  furnished  equipment  leases for Cargo
Connection Logistics Corp. The transactions for the past three years were:

Year                                                    Equipment Leases
--------------------------------------------------------------------------------
2006                                                    $ 4,800
2005                                                    $ 4,800
2004                                                    $ 4,800

Cargo Connection  Logistics  Holdings,  Inc. has had transactions with a related
party. In October,  2005, Cargo Connection  Logistics Holdings,  Inc. was loaned
$75,000 by certain officers of the Company. This loan is collateralized  through
a convertible  note at an interest  rate of 15%. The certain  officers are Jesse
Dobrinsky,  Scott Goodman and John L. Udell.  Messrs.  Dobrinsky and Goodman are
officers, directors and shareholders of our Company. Mr. Udell is an officer and
shareholder of our Company.

Cargo  Connection  Logistics  Holding,  Inc. has had  transactions  with related
parties. On October 27, 2005, Cargo Connection  Logistics received funds through
the  sale of  certain  preferred  stock of the  Company.  The  Company  received
$100,000  from  certain  officers of the  Company in return for the  issuance of
Series III Preferred Stock. The certain officers are Jesse Dobrinsky and John L.
Udell.  Mr.  Dobrinsky is an officer,  director and shareholders of our Company.
Mr. Udell is an officer and shareholder of our Company.

NOTE 22 - INCOME TAXES

Prior  to May  12,  2005,  both  Cargo  Connection  Logistics  Corp.  and  Cargo
Connection Logistics - International, Inc. (f/k/a Mid Coast Management, Inc. had
elected under the  Subchapter S provisions  of the Internal  Revenue Code, to be
treated as an "S"  Corporation.  Accordingly,  there is no provision for federal
and state income taxes for the  Companies  for the year ended  December 31, 2005
and for the period January 1, 2005 through May 11, 2005,  because such liability
is the  responsibility  of  the  individual  shareholders.  Effective  with  the
business  combination as described in Note 1, Cargo  Connection  Logistics Corp.
and  Cargo  Connection   Logistics  -  International,   Inc.  (f/k/a  Mid  Coast
Management,  Inc.) will no longer  qualify to be taxed as "S"  Corporations  and
therefore will be considered  C-corporations subject to federal, state and local
corporate taxes beginning May 12, 2005.

For the years ended December 31, 2006 and 2005, there was no income tax expense

                                          2006              2005
Federal
                Current               $           -     $           -
                Deferred                          -                 -
                                      -------------     -------------
                Total                             -                 -
                                      -------------     -------------

State and local
                Current               $           -     $           -
                Deferred                          -                 -
                                      -------------     -------------
                Total                             -                 -
                                      -------------     -------------

                                      -------------     -------------
Total                                 $           -     $           -
                                      =============     =============

                                      F-27
<PAGE>

Deferred  income  taxes  reflect  the net tax effects of  temporary  differences
between  the  carrying  amount  of the  assets  and  liabilities  for  financial
reporting purposes and the amounts reported for income tax purposes. Significant
components of the Company's net deferred income tax assets and liabilities as of
December 31, 2006 and 2005 are as follows:

                                                         2006           2005
                                                     -----------    -----------
Deferred tax asset
                Net operating loss carry-forward     $ 2,594,000    $ 1,588,129
                Deferred rent                            415,000        350,227

                Accrued compensation                     123,000             --

                Asset reserves and other items            74,000        445,923
                                                     -----------    -----------
Total deferred tax asset                               3,206,000      2,384,279

Less valuation allowance                              (3,206,000)    (2,384,279)
                                                     -----------    -----------
                Total net deferred tax asset                  --             --
                                                     ===========    ===========

The company has net operating losses carry-forwards and other deferred tax items
of  approximately  $8,200,000  at December  31, 2006 that will be  available  to
offset future  taxable  income.  The Company has concluded that a full valuation
allowance was appropriate for the deferred tax items as they are not more likely
than not going to be utilized in the foreseeable future.

The  Company  has  approximately  $7  million  of tax loss  carry-forwards.  The
scheduled expiration of such NOL's is as follows:

For the Year Ending December 31,
                           2025                         4,000,000
                           2026                         3,000,000
                                                        ---------
                           Total                        7,000,000
                                                        =========

Income taxes  computed at the  statutory  rate for the years ended  December 31,
2006 and 2005 differ from amounts provided as follows:

                                                    2006              2005
                                                -------------     ------------
Tax provision (benefit) at statutory rate                 (34%)            (34%)
State and local taxes, net of federal benefit              (3%)             (6%)
Derivative expenses                                        16%               0%
Change in valuation allowance                              21%              40%

                                                -------------     ------------
Effective income tax rate                                   0%               0%
                                                =============     ============

                                      F-28
<PAGE>

Item 8. - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

Friedman LLP is the Company's independent  registered public accounting firm. At
no time has there been any  disagreement  with such  accountants  regarding  any
matter of accounting principles or practices, financial statement disclosure, or
auditing scope or procedure.

a)    Previous Independent Auditors:

      (i)   On June 17, 2005, Massella & Associates,  CPA, PLLC was dismissed as
            our independent  registered  public accounting firm and Friedman LLP
            was appointed as our new independent  registered  public  accounting
            firm

      (ii)  During  the  two  most  recent  fiscal  years  and  interim   period
            subsequent  to December 31, 2004,  there have been no  disagreements
            with  Massella &  Associates,  CPA, PLLC on any matter of accounting
            principles or practices, financial statement disclosure, or auditing
            scope or procedure.

      (iii) Massella  &  Associates,   CPA,   PLLC`s  report  on  the  financial
            statements for the year ended December 31, 2004 contained no adverse
            opinion or  disclaimer  of opinion and was not qualified or modified
            as  to  audit  scope  or  accounting   principles  but  included  an
            explanatory   paragraph   reflecting  an  uncertainty   because  the
            realization  of a major portion of our assets was dependent upon our
            ability to meet our future financing requirements and the success of
            future operations.  These factors raised substantial doubt about our
            ability to continue as a going concern.

      (iv)  Massella  &  Associates,  CPA,  PLLC  furnished  us  with  a  letter
            addressed  to  the  SEC  stating  that  it  agrees  with  the  above
            statements. A copy of the letter to the SEC dated June 17, 2005, was
            filed as an Exhibit to our Form 8-K filed on July 25, 2005 (SEC File
            No. 000-28223).

      (v)   During  the two most  recent  fiscal  years and the  interim  period
            subsequent  to  December  31,  2004,  there have been no  reportable
            events with  Massella &  Associates,  CPA, PLLC as set forth in Item
            304(a)(i)(v) of Regulation S-K.

b)    New Independent Registered Public Accounting Firm:

      (i)   We engaged  Friedman LLP as our new  independent  registered  public
            accounting firm as of June 17, 2005.  Prior to such date, we did not
            consult  with  Friedman  LLP  regarding  (i)  the   application   of
            accounting principles,  (ii) the type of audit opinion that might be
            rendered  by Friedman  LLP,  or (iii) any other  matter that was the
            subject of a  disagreement  between  us and our  former  independent
            registered  public accounting firm as described in Item 304(a)1)(iv)
            of Regulation S-B.

Item 8A. - CONTROLS AND PROCEDURES

(a)   Evaluation of disclosure controls and procedures

The  Company's  Chief  Executive  Officer  and  Chief  Financial  Officer,  have
evaluated  the   effectiveness  of  the  Company's   "disclosure   controls  and
procedures"  (as defined in Rules  13a-15(e) and 15d-15(e)  under the Securities
Exchange  Act of 1934,  as amended) as of the end of the period  covered by this
report.  Based on that  evaluation,  the Company's Chief  Executive  Officer and
Chief Financial Officer have identified the following material weaknesses:

                                       26
<PAGE>

Management did not possess  sufficient  technical  expertise nor have the needed
knowledge  base to  properly  account  for and prepare  financial  footnotes  in
accordance  with  generally  accepted  accounting   principles  with  regard  to
derivatives financing transactions.

Management did not possess  sufficient  technical  expertise nor have the needed
knowledge  base to  properly  account  for and prepare  financial  footnotes  in
accordance with generally accepted  accounting  principles with regard to income
taxes and deferred taxes.

Management lacked certain internal controls over period-end reporting related to
the identification of significant  transactions,  primarily equity transactions,
embedded derivatives in certain financial instruments, which include among other
things,  convertible  notes,  freestanding  warrant  agreements and registration
rights agreements and accounting for them in the proper periods. This deficiency
resulted in a restatement of its financial statements for the three months ended
March 31, 2005,  the three and six months ended June 30, 2005, and the three and
nine months September 30, 2005, as appropriate to properly account for the above
transactions.

As a result of the  identification  of the  misapplication of US GAAP rules, our
Chief Executive  Officer and Chief Financial  Officer have concluded that, as of
December  31, 2006,  our  internal  control  over  financial  reporting  was not
effective.

Remediation of Material Weaknesses

We  have  assigned  a  high  priority  to  both  the  short-term  and  long-term
strengthening of these controls and have identified certain additional measures,
which we believe will address the conditions  identified as a material weakness,
including the following:

1)    the  Company  has engaged an  independent  CFA to analyze  the  valuations
      pertaining  to the  embedded  derivatives  associated  with the  financial
      instruments;

2)    the  Company  has worked with an  accounting  firm  (other than  Company's
      independent auditor) to consult with on accounting issues;

3)    the Company will review new  accounting  pronouncements  to determine  the
      applicability to the Company;

4)    the Company will subscribe to professional  publications  that discuss new
      accounting rules and regulations;

5)    members of Company's  accounting  management will attend financial related
      seminars.

Based  upon the above we  believe  we have set a plan in motion to  correct  any
significant  deficiencies  or material  weaknesses  or other  factors that could
significantly affect these controls. Therefore the Company believes it will have
proper  controls and  procedures in place to deal with these  transactions  on a
go-forward basis.

(b)   Changes in internal controls.

Except as set forth above,  there have been no changes in our  internal  control
over  financial  reporting  that occurred  during the quarter ended December 31,
2006 that have  materially  affected,  or are  reasonably  likely to  materially
affect, our internal control over financial reporting.

                                       27
<PAGE>

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

The Company is party to various legal  proceedings  generally  incidental to its
business as is the case with other companies in the same industry.  Although the
ultimate disposition of legal proceedings cannot be predicted with certainty, it
is the opinion of  management  that the outcome of any claim which is pending or
threatened,  either  individually  or on a  combined  basis,  will  not  have  a
materially  adverse  effect  on the  consolidated  financial  statements  of the
Companies.

Item 2. Changes in Securities.

On  January  6,  2006,  we  issued  4,566,210  shares  of our  common  stock  to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On January 9, 2006, we issued  2,705,628 shares of our common stock to Advantage
Capital, based on the conversion of $5,000 of a convertible promissory note.

On January 9, 2006, we issued 4,032,258 shares of our common stock to Advantage,
based on the conversion of $10,000 of a convertible promissory note.

On  January  19,  2006,  we  issued  3,436,426  shares  of our  common  stock to
Montgomery, based on the conversion of $10,000 of a convertible promissory note.

On  January  30,  2006,  we  issued  8,230,452  shares  of our  common  stock to
Advantage, based on the conversion of $20,000 of a convertible promissory note.

On January 30, 2006, we issued 3,541,666 shares of our common stock to Advantage
Capital, based on the conversion of $8,500 of a convertible promissory note.

On  January  30,  2006,  we  issued  8,230,452  shares  of our  common  stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On  February  8,  2006,  we  issued  5,249,344  shares  of our  common  stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On  February  16,  2006,  we  issued  8,264,463  shares of our  common  stock to
Montgomery, based on the conversion of $20,000 of a convertible promissory note.

On  February  27,  2006,  we issued  11,509,993  shares of our  common  stock to
Montgomery,  based on the conversion of $20,000 of a convertible promissory note
and accrued interest.

On March 1, 2006,  we issued  3,496,503  shares of our common stock to Advantage
Capital, based on the conversion of $10,000 of a convertible promissory note.

On March 1, 2006, we issued  8,710,801  shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

On March 3, 2006, we issued  8,064,516 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

On March 7, 2006, we issued  6,053,269 shares of our common stock to Montgomery,
based on the conversion of $25,000 of a convertible promissory note.

On March 10, 2006, we issued  4,180,602 shares of our common stock to Advantage,
based on the conversion of $25,000 of a convertible promissory note.

                                       28
<PAGE>

On March 17, 2006,  180,000,000 shares of the Company's common stock were issued
to Triple Crown  Consulting,  Inc. and its assignees  based on the conversion of
35,000 shares of Series IV Convertible Preferred stock.

On May 4, 2006, we issued  1,562,500  shares of our common stock to  Montgomery,
based on the conversion of $10,000 of a convertible promissory note. Due to this
conversion,  $21,875 was  recorded  as  additional  paid in capital,  based on a
valuation performed in connection with the derivative instrument associated with
this note.

On July 6, 2006,  8,000,000  shares of the Company's common stock were issued to
Montgomery,  based  on  the  conversion  of  $20,000  of a  convertible  secured
debenture.  Due to this conversion,  $105,600 was recorded as additional paid in
capital,  based on a  valuation  performed  in  connection  with the  derivative
instrument associated with this note.

On July 21, 2006, 32,000,000 shares of the Company's common stock were issued to
Montgomery,  based  on  the  conversion  of  $80,000  of a  convertible  secured
debenture.  Due to this conversion,  $422,400 was recorded as additional paid in
capital,  based on a  valuation  performed  in  connection  with the  derivative
instrument associated with this note.

On July 25, 2006, 11,637,050 shares of the Company's common stock were issued to
David Goldberg,  based on the conversion of $86,790 of a convertible  promissory
note and  accrued  interest  of $8,750.  Due to this  conversion,  $274,635  was
recorded as  additional  paid in  capital,  based on a  valuation  performed  in
connection with the derivative instrument associated with this note.

On August 28, 2006,  4,838,710  shares of the Company's common stock were issued
to UTEK  Corporation  for  payment  of  consulting  services  in the  amount  of
$120,000.

On December 28, 2006, 7,142,857 shares of the Company's common stock were issued
to a consultant for payment of their services in the amount of $75,000.

All of these shares were issued in reliance on the exemption  from  registration
provided by Section 4(2) of the Securities Act of 1933. No commissions were paid
for the  issuance of such  shares.  All of the above  issuances of shares of our
common stock qualified for exemption under Section 4(2) of the Securities Act of
1933 since the issuance of such shares by us did not involve a public  offering.
All  shareholders  were  sophisticated  investors and had access to  information
normally  provided in a prospectus  regarding us. The offering was not a "public
offering" as defined in Section 4(2) due to the insubstantial  number of persons
involved in the deal, size of the offering, manner of the offering and number of
shares offered.  We did not undertake an offering in which we sold a high number
of shares to a high number of investors.  In addition,  all shareholders had the
necessary investment intent as required by Section 4(2) since they agreed to and
received  a share  certificate  bearing a legend  stating  that such  shares are
restricted  pursuant to Rule 144 of the 1933 Securities Act. These  restrictions
ensure that these shares would not be immediately  redistributed into the market
and  therefore not be part of a "public  offering."  Based on an analysis of the
above  factors,  we have met the  requirements  to qualify for  exemption  under
Section 4(2) of the Securities Act of 1933 for the above transaction.

On March 14, 2006, we paid  $242,017.77  to  Advantage,  to redeem the remaining
balance, plus interest, of the convertible promissory note held by them.

On March 17,  2006,  we paid  $28,139.51  to  Advantage  Capital,  to redeem the
remaining  balance,  plus interest,  of the convertible  promissory note held by
them.

                                       29
<PAGE>

On May 4, 2006,  we paid  $40,559.72  to  Montgomery,  to redeem  the  remaining
balance, plus interest, of the convertible promissory note held by them.

SUBSEQUENT EVENTS

-None-

Item 3. Defaults Upon Senior Securities.

Not Applicable

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

-None-

Item 5. Other Information.

-None-


                                       30
<PAGE>

                                    PART III

ITEM 9. - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS:
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

Officers and Directors

The following table sets forth the name, age, position, and the start date of
each director and executive officer of Cargo Connection Logistics Holding, Inc.
and its subsidiaries at December 31, 2005. There are no other persons who can be
classified as a promoter or controlling person of the Company.

<TABLE>
<CAPTION>

NAME                    AGE    DIRECTOR/POSITION(1)                                      HELD SINCE
----                    ---    --------------------                                      ----------

<S>                     <C>                                                                 <C>
Jesse Dobrinsky         50     President, Principal Executive Officer and                   2005
                                  Chairman of the Board of Directors;
                               President, Cargo Connection Logistics Corp.                  1996
                                  our subsidiary;
                               CEO, Cargo Connection Logistics - International,             2005
                                  Inc. (f/k/a Mid-Coast Management, Inc.) our
                                  subsidiary;
                               Manager, Nuclear Material Detection Technologies,            2006
                                  Inc. our subsidiary.

Scott O. Goodman        47     Principal Financial Officer, Chief Operating Officer,        2005
                                  Secretary and Director;
                               Executive Vice President, Treasurer and Secretary,           1996
                                  Cargo Connection Logistics Corp. our subsidiary;
                               Treasurer and Secretary, Cargo Connection Logistics -        1996
                                  International, Inc. (f/k/a Mid-Coast Management, Inc.)
                                  our subsidiary.

John L. Udell           51     Vice President; Vice President and Assistant Secretary,      1998
                                 Cargo Connection Logistics Corp. our Subsidiary;
                               Vice President and Assistant Secretary, Cargo Connection     1998
                                  Logistics - International, Inc. (f/k/a Mid-Coast
                                  Management, Inc.) our subsidiary.

William F O'Connell     52     Vice President - Sales and Marketing, Cargo Connection       2006
                                 Logistics Corp. our subsidiary.

Raymond G. Hunt         60     Senior Vice President, Cargo Connection Logistics -          2006
                                 International, Inc. our subsidiary.

Kenneth J. Ryan         59     Vice President, Cargo Connection Logistics Corp.             2006
                                 our subsidiary.
</TABLE>


(1)               Officers and Directors

      a)    All Directors of the Company will hold office until the next annual
            meeting of shareholders of the Company or until their successors are
            duly elected and qualified.

      b)    The Officers of the Company are appointed by the Board of Directors
            at the first meeting after each annual meeting of the Company's
            shareholders, and hold office until their death, or until they shall
            resign or have been removed.

      c)    The Officers of the Company's subsidiary organizations hold office
            at will.

<PAGE>

The following is a biographical summary of our directors and officers:

Jesse Dobrinsky, President, Chief Executive Officer and Director. Jesse was born
in 1956. He was raised and educated in New York.  Jesse has been an entrepreneur
all of his life.  While  working his way  through  college,  Jesse  worked as an
assistant  pharmacist and an assistant  manager for Edison  Brothers  Shoes.  In
mid-1978  he  and an  associate  opened  a  retail  stereo  shop  called  Sounds
Incredible.  They grew this business until the sales volume was in excess of one
(1)  million  dollars  per  year.  In  1981,  Jesse  was  enticed  into a family
restaurant  business  where he spent the next year building up the business.  In
1982,  Jesse was given the  opportunity  to open a sales  agency  for a group of
Midwestern  meat haulers.  This company was called Coast  Dispatch,  Inc. It was
started  in a small  office in  Manhattan  and its  focus was to sell  westbound
freight from the  Northeastern  portion of the United  States.  As this business
grew, the customers began to inquire about trucks to haul freight throughout the
country.  In early 1983 Coast  Dispatch,  Inc.  became an irregular route common
carrier. Over the next twelve years Coast Dispatch, Inc. grew to over 40 company
trucks and ten  million  dollars in sales.  In 1995,  Landstar-Inway  approached
Jesse and asked him to open an Air-Freight Division for the Landstar group. This
division  was  called  Cargo  Connection  Logistics.  With Jesse at the helm the
company grew from less than three million  dollars in sales in 1996 to over five
million dollars in sales in 1997. In late 1997,  Landstar-Inway  was directed to
refocus on their core  business and to disband any business that was not related
to that core business.  In 1997, Cargo  Connection  Logistics became a non-owned
division of ARL and in 1998, did in excess of eight million dollars in sales. In
1999,  the sales volume  exceeded  twelve million  dollars and Cargo  Connection
Logistics became the largest non-owned division of ARL.

Scott Goodman, Chief Financial Officer,  Chief Operating Officer,  Secretary and
Director.  Scott  was  born  in  1959.  He  attended  schools  in New  York  and
Massachusetts.   Scott   holds  a  Bachelor   of  Science   Degree  in  Business
Administration with a major in accounting from Northeastern University.  He also
obtained his MBA from Adelphi  University with majors in International  Business
and Corporate Finance.  Scott began his career with Norman Goldstein  Associates
("NGA") where his primary  duties were as Controller  for NGA and as Director of
Operations for its subsidiary  company,  E & N Plastics.  It was at this company
that Scott  began to travel  the  world.  In 1983,  Scott  joined M.  Blumenthal
Graphics, a New York City printing house, as Controller and later as Director of
Operations.  In 1988, Scott went to work for Lafayette  Precision  Products.  As
Controller and Director of Purchasing,  Scott was responsible for overseeing and
managing  the  installation  and  implementation  of a new computer  system.  In
addition,  he was very involved with  developing new procedures for  purchasing,
inventory  control and  financial  reporting.  When  Reichel & Drews  bought the
company and ultimately moved the operation to their  headquarters in Itasca,  IL
in 1990, Scott went to work for Landes Marketing. At Landes Marketing Scott held
dual  positions as their Vice President and General  Manager.  He joined them in
order to  restructure  their  financial debt and reduce costs after heavy losses
were  sustained by the Landes  family.  Landes was a leader in the marketing and
distribution  of  silver-plated  tabletop and giftware.  It was in this position
that Scott began to develop a deeper  understanding of the import business.  One
of the vendors Scott became  intimate with was Ben Forman & Sons. In 1992,  when
Landes  Marketing was being sold, Scott went to work for Ben Forman & Sons where
he  was  responsible  for  the  financial  area  of  the  multi-million   dollar
manufacturing  company.  He was  also  responsible  for  the  company's  related
real-estate ventures.  In 1995 Scott Goodman met Jesse Dobrinsky.  In late 1995,
he went to work for Coast Dispatch,  Inc. as its CFO. In 1996 Scott joined Jesse
Dobrinsky  at  Cargo  Connection   Logistics,   where  they  went  to  work  for
Landstar-Inway.  With Jesse  Dobrinsky  as  President,  Scott joined the team as
Executive Vice President.  The company grew from less than three million dollars
in  sales  in 1996 to  over  five  million  in  sales  in  1997.  In late  1997,
Landstar-Inway was directed to refocus on their core business and to disband any
business  that was not  related  to that main  business  focus.  In 1997,  Cargo
Connection  Logistics  became a non-owned  division of ARL and in 1998 had sales
volumes in excess of eight million  dollars.  In 1999, the sales volume exceeded
twelve  million  dollars  and Cargo  Connection  Logistics  became  the  largest
non-owned division of ARL. In May 2001, Cargo Connection  Logistics stood on its
own and began its quest to  becoming  a  logistics  provider  for the  logistics
industry,  which includes  airfreight  carriers,  freight  forwarders as well as
manufacturers.

<PAGE>

John L. Udell, Vice President. John was born in 1955. He was raised and educated
in New  York.  John has had an  entrepreneurial  spirit  his whole  life.  While
working his way through college,  John had many jobs. In 1976, before completing
his  education,  John was  called  home  from  school  to help  save the  family
business.  Later that year,  John became the Director of the Finishing  Division
for AMPCO Printing  Company.  It became John's  responsibility to make sure that
jobs were finished properly and shipped out in a timely manner. While performing
this job it became  clear to John that  there was a need for and  ultimately  an
opportunity for a trucking company that could provide  expedited service for the
printing industry. He took this concept to a friend and in 1982, Jesse Dobrinsky
and John Udell formed a company  called  Coast  Dispatch,  Inc.  John soon found
himself intrigued by the growth and opportunity at Coast Dispatch,  Inc. He soon
decided  to make it his full time  career.  Over the next 12 years John was very
instrumental in the development and growth of Coast Dispatch, Inc. In 1996, when
Jesse departed from the company, John became its President and began to lead the
company into a rebuilding process. It was his dream to build a regional trucking
company that would focus on the New York Tri-State Area. In 1996, after bringing
the  company  through a major  overhaul,  the  investors  chose to shut down the
company.  During  that last year John had  managed  to reduce the debts of Coast
Dispatch,  Inc. from just over two million  dollars to less than fifty  thousand
dollars.  John spent the balance of the year closing  Coast  Dispatch,  Inc. and
selling off the assets of the company. In mid-1997, John joined Cargo Connection
Logistics as its  Director of  Container  Freight  Station  Operations.  In that
capacity, John managed the two main CFS operations in New York and Chicago. John
also headed up both the Safety & Compliance and Driver Recruitment Departments.

William ("Bill") F. O'Connell, Vice President -Sales and Marketing. Bill started
working in the airfreight industry in 1970 for Airfreight Warehouse  Corporation
on a part-time basis, while still going to school. Upon graduation in June 1972,
he began working as a warehouseman on a full time basis. In January,  1973, Bill
was promoted to supervisor and managed six  warehousemen  in one facility.  Bill
loaded and unloaded  trucks,  segregated  shipments for distribution and managed
all  general  order  (G.O.)  shipments.  In the  summer of 1974 Bill  became the
manager of one of the JFK  facilities  where he oversaw  all  aspects of general
order and warehouse  entry shipments and dispatched all drivers for G.O. In 1977
it became Bill's  responsibility  on behalf of Airfreight  Warehouse to start up
new G.O.  operations  in Los Angeles,  California.  In 1982 Bill was promoted to
Vice  President  of  Airfreight  Warehouse  Corp.  and  he  expanded  their  JFK
operations  from 50,000 to 150,000 square feet while traveling back and forth to
Los  Angeles  once a month.  In 1985  Bill's  recommendation  was  followed  and
Airfreight  Warehouse opened a trucking  division to control its  transportation
requirements.  That company was  Chevalier  Transportation.  It was started with
five tractor  trailers.  This operation was  originally  designed to control the
Pick Up of freight  for  General  Order  operations.  In  addition,  Bill worked
closely with United States  Customs not to bid trucking for this operation as it
did not provide the control  necessary for United States  Customs.  In 1986 Bill
was once again tasked with  expanding  Air Freight  Warehouse  and opened Miami,
Florida and was  instrumental in acquiring all permits,  bonds and approvals for
setting  up  this  new  facility.   And  again  in  1987,  Bill  was  given  the
responsibility  to open up general order and bonded warehouse  facilities in San
Francisco, CA. and Chicago, IL. The truck operation for General Warehouse was so
successful  in New York,  Bill was selected to start up trucking  operations  to
handle our own freight for local pickup and delivery in each of their  stations.
In 1988 Bill was invited to sit on the advisory  board for United States Customs
to help  write and  implement  regulations  for all  general  order  and  bonded
warehouses.  In 1992 after death of the President of Air Freight Warehouse, Bill
was promoted and placed in charge of all  warehouse  and trucking  operations in
the United States.  In 2001 Bill was once again selected and promoted to work in
main  office in New York City and  oversaw  all of the  businesses  owned by the
owners of Air Freight Warehouse. In 2002 Bill became Executive Vice President of
all  companies,  which included a security  business as well as warehousing  and
trucking.  Bill  resigned  from all these  companies  in early  2006  after many
changes  in this  family  run  business.  It was then  that  Bill  joined  Cargo
Connection Logistics Corp. Bill has been instrumental in getting the approval by
United States Customs to have Cargo Connection  Logistics Corp. appointed as the
new G.O.  Warehouse.  Bill  holds  the  position  of Vice  President  of Sales &
Marketing.

<PAGE>

Raymond  ("Ray") Hunt,  Senior Vice  President of Cargo  Connection  Logistics -
International, Inc. Ray, prior to joining our organization had spent 23 years at
Digital  Equipment  Corp.  holding  various  managerial  positions in materials,
production control, order management and operations. Ray spent the last 10 years
at DEC working in the  International  Division  managing  the  relationship  and
execution between field sales and manufacturing,  ensuring a linkage between the
revenue and  manufacturing  plans.  Ray left DEC to become the Vice President of
Operations for Mary Kay Cosmetics in Dallas Texas. His responsibilities included
transportation, 6 regional warehouses, order management,  materials, new product
planning,  management of the 9700 leased vehicles,  and demand  planning.  After
Mary Kay,  Ray became  Vice  President  of  Transportation  for MAST  Industries
(Division of the Limited). He was responsible for coordinating the efforts of 11
air  freight  forwarders,  5 ocean  carriers,  and CFS  providers  to  ensure  a
consistent and predictable  flow of product from 30 counties to Columbus,  Ohio.
Ray was recruited to become the Vice President of the supply chain for Enterasys
Networks in Andover,  MA.  Ray's  responsibilities  included,  demand  planning,
materials management, transportation,  quality, order management warehousing and
the  management  of all the  company's 3PL  suppliers.  After leaving  Enterasys
Networks, Ray began consulting for Cargo Connection Logistics,  where he focused
on process,  metrics and long range  planning.  Ray has since joined our team as
Senior Vice President at Cargo Connection Logistics - International. He has been
to the Pacific Rim and Central America since he joined the company. Ray holds an
MBA and has taken advanced  management  courses at the Insead Euro-Asia  Center,
France.

Kenneth ("Ken") J. Ryan,  Vice President - Mid-West  Region of Cargo  Connection
Logistics  Corp. Ken was born and raised in Dublin,  Ireland.  After  completing
High  School he joined the British  Army as a member of the Royal Irish  Rangers
for 7 years.  After  the  completion  of his  service  to the  British  Army Ken
attended  Bishop  Otter  College  in Sussex  England  and  received  a degree in
Education.  Ken worked in England for several  years  before  emigrating  to the
United  States.  Since Ken's  arrival in the United  States,  he has been in the
Transportation  and  Logistics  industry.  Ken's  career  began with  Burlington
Northern Air Freight,  where he started as a night operations manger and rose to
the  position  of Station  Manager in  Chicago,  IL. In 1982 Ken joined the Link
America/Air  Wisconsin  Road  Feeder  Service  as their  Director  of Sales  and
Operations. Link America was one of the first true Road Feeder operations in the
United  States.  He worked with both Domestic and  International  Airlines which
required  either a first or final  carrier  to  comply  with  International  and
Federal regulations.  During ken's tenure at Link America, he helped to increase
sales by over $12 million  dollars.  In 1986 Ken opened a company  called Airmax
Airlines.  Airmax grew to be the  largest  International  Interline  Road Feeder
Service and serviced destinations throughout North America with company stations
in every major Airline  gateway in the United  States.  At its peak,  Airmax had
over 1500 daily  departures  and  served the  majority  of the  foreign  flagged
airlines  arriving  into the United  States for there  import and export  cargo.
During Ken's  tenure at Airmax  Airlines,  he traveled the world and  negotiated
agreements in China, Korea, Japan, Malaysia,  Europe, Central and South America.
Ken is considered to be an expert in the  International  Cargo  business and has
delivered addresses  International  Cargo Symposiums.  Ken was inducted into the
Entrepreneurship  Hall  of Fame  as a  result  of  leadership  and  the  advance
management  practices  implemented  while  at  Airmax  Airlines.  Ken was also a
finalist in the  Entrepreneur  of the year award.  In 1997 Airmax  Airlines  was
merged with  Alliance  Airlines and in 1998 Ken left the company to pursue other
opportunities.  In 1998, in the midst of the dot com boom,  Ken was hired as the
President of a startup internet company called  Honesty.com.  Ken had negotiated
an  exclusive  arrangement  with EBay and  raised 8 million  dollars to fund the
future of the business. In 2001 Ken helped negotiate the sale of this company to
Anadale  for 30  million  dollars.  It was  his  responsibility  to get  the two
companies  integrated  and to their two  cultures.  After  spending  6 months in
California bringing these two organizations together,  Ken's position was phased
out and he returned to Chicago and spent the next 3 years  providing  consulting
services for several companies.  In 2005 Ken was recruited by US Xpress as their
Vice  President of  International  Sales with a core focus on the  International
Airlines  business.  Within a very short  period of taking  this  position,  the
company sold its assets to Forward Air. It was at this time that Ken joined CRST
as Senior Vice  President  of Sales with a focus in the Air Freight  Market.  In
November of 2006 Ken was approached and joined by management at Cargo Connection
Logistics to become a member of their team.

<PAGE>

Code of Ethics

We have adopted a Code of Ethics within the meaning of Item 406(b) of Regulation
S-K of the Exchange  Act.  This Code of Ethics  applies to directors  and senior
officers, such as the principal executive officer,  principal financial officer,
controller,  and persons  performing  similar  functions,  of ours. Such code of
ethics is filed as an exhibit to the accompanying registration statement.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our executive  officers directors and
persons who  beneficially own more than ten percent of a registered class of our
equity securities  ("Reporting Persons") to file reports of beneficial ownership
and  changes in  beneficial  ownership  on Forms 3, 4 and 5 with the SEC.  These
Reporting  Persons are required by SEC  regulation  to furnish us with copies of
all Forms 3, 4 and 5 that they file with the SEC.  Based  solely upon our review
of the copies of all Forms 3, 4 and 5 and amendments to these forms,  we believe
that  all  Reporting  Persons  complied  on  a  timely  basis  with  all  filing
requirements  applicable to them with respect to our fiscal year ended  December
31, 2006.

Term of Office

Directors

Our Board of Directors  currently consists of 2 seats.  However,  up to 7 may be
elected to serve on the Board.  Directors serve for a term of one year and stand
for election at our annual meeting of  stockholders.  Pursuant to our Bylaws,  a
majority of  directors  may appoint a successor to fill any vacancy on the Board
of  Directors.  All  Directors  of the Company  will hold office  until the next
annual meeting of shareholders of the Company or until their successors are duly
elected and qualified.  There are no agreements  with respect to the election of
Directors.  We have not  compensated  our  Directors for service on our Board of
Directors,  any  committee  thereof,  or  reimbursed  for expenses  incurred for
attendance  at meetings of our Board of  Directors  and/or any  committee of our
Board of Directors.

<PAGE>

Officers

The officers of the Company are appointed by the Board of Directors at the first
meeting after each annual meeting of the Company's shareholders, and hold office
until their death, or until they shall resign or have been removed.

None of our Officers and/or Directors have filed any bankruptcy  petition,  been
convicted of or been the subject of any criminal  proceedings  or the subject of
any order,  judgment or decree  involving  the violation of any state or federal
securities laws within the past five (5) years.

Committees

The Company has not established any committees at this time.

Audit Committee

We do not have a standing audit committee of the Board of Directors.  Management
has  determined  not to establish an audit  committee at present  because of our
limited resources and limited operating  activities do not warrant the formation
of an audit  committee  or the  expense of doing so. We do not have a  financial
expert  serving on the Board of  Directors  or employed  as an officer  based on
management's  belief  that the cost of  obtaining  the  services of a person who
meets the criteria for a financial expert under Item 401(e) of Regulation S-B is
beyond its  limited  financial  resources  and the  financial  skills of such an
expert  are  simply not  required  or  necessary  for us to  maintain  effective
internal controls and procedures for financial reporting in light of the limited
scope and simplicity of accounting issues raised in its financial  statements at
this stage of its development.

Certain Legal Proceedings

No  director,  nominee for  director,  or  executive  officer of the Company has
appeared as a party in any legal  proceeding  material to an  evaluation  of his
ability or integrity during the past five years.


Item 10. - EXECUTIVE COMPENSATION

The  following  table sets forth  information  concerning  annual and  long-term
compensation,  on an  annualized  basis for the 2006 fiscal year,  for our Chief
Executive  Officer  and for each of our other  executive  officers  (the  "Named
Executive Officers") whose compensation on an annualized basis is anticipated to
exceed $100,000 during fiscal 2007.

<PAGE>

                           Summary Compensation Table

The following table shows the compensation paid over the past three fiscal years
with respect to the named Executive Officers whose compensation on an annualized
basis is anticipated to exceed $100,000 during fiscal 2006:

<TABLE>
<CAPTION>

                                                                                       Non-Qualified
                                                                       Non-Equity        Deferred
                                                  Stock    Option    Incentive Plan     Compensation     All Other
Name and  Principal            Salary     Bonus   Awards   Awards     Compensation       Earnings       Compensation     Totals
Position              Year       ($)       ($)     ($)      ($)           ($)              ($)              ($)            ($)

<S>                  <C>        <C>        <C>     <C>      <C>           <C>              <C>              <C>          <C>
Jesse Dobrinsky      2006       156,579    ---     ---      ---           ---              ---              ---          156,579
President , CEO      2005       125,577    ---     ---      ---           ---              ---              ---          125,577
                     2004       160,462    ---     ---      ---           ---              ---              ---          160,462

Scott Goodman        2006       135,472    ---     ---      ---           ---              ---              ---          135,472
CF0, COO             2005       108,077    ---     ---      ---           ---              ---              ---          108,077
And Secretary        2004       142,904    ---     ---      ---           ---              ---              ---          142,904

John Udell           2006       110,475    ---     ---      ---           ---              ---              ---          110,475
Vice President       2005        95,192    ---     ---      ---           ---              ---              ---           95,192
                     2004       112,804    ---     ---      ---           ---              ---              ---          112,804

William F.           2006       112,500    ---     ---      ---           ---              ---              ---          112,500
O'Connell

Raymond Hunt         2006        30,769    ---     ---      ---           ---              ---              ---           30,769

Kenneth J. Ryan      2006         4,904    ---     ---      ---           ---              ---              ---            4,904

</TABLE>




                             OPTION/SAR GRANTS TABLE

<TABLE>
<CAPTION>
                                                                      % TOTAL
                                         NO. OF SECURITIES          OPTIONS/SAR'S
                                             UNDERLYING               GRANTED TO
                                           OPTIONS/SAR'S         EMPLOYEES IN YEAR ENDED    EXERCISE OR
                                              GRANTED             DECEMBER 31, 2006          BASE PRICE
NAME                                            (#)                      (%)                ($ PER SHARE)    EXPIRATION DATE
----                                            ---                      ---                -------------    ---------------

<S>                                             <C>                      <C>                     <C>               <C>
Jesse Dobrinsky                                 ---                      ---                     ---               ---
President and Chief Executive Officer

Scott                                           ---                      ---                     ---               ---
Goodman
Chief    Financial    Officer,    Chief
Operating
Officer and Secretary

John L. Udell                                   ---                      ---                     ---               ---
Vice President

</TABLE>


The following table contains information regarding options exercised in the year
ended  December  31, 2006,  and the number of shares of common stock  underlying
options held as of December  31, 2006,  by Cargo  Connection's  named  executive
officers.

AGGREGATED OPTIONS/SAR EXERCISES
IN LAST FISCAL YEAR AND
FISCAL YEAR END OPTIONS/SAR VALUES

<TABLE>
                                                              NUMBER OF SECURITIES
                                                             UNDERLYING UNEXERCISED
                             SHARES                               OPTIONS/SAR'S                 IN THE MONEY OPTIONS/SAR'S
                          ACQUIRED ON       VALUE                   AT FY END                           AT FY END
                            EXERCISE      REALIZED                     (#)                                 ($)
                            --------
NAME                          (#)            ($)         EXERCISABLE       UNEXERCISABLE      EXERCISABLE      UNEXERCISABLE
----                          ---            ---         -----------       -------------      -----------      -------------

<S>                            <C>            <C>           <C>                <C>                 <C>             <C>

Jesse Dobrinsky                --             --            --                 --                  --              --
President and Chief
Executive Officer

Scott Goodman                  --             --            --                 --                  --              --
Chief Financial Officer,
Chief Operating Officer
  and Secretary

John L. Udell                  --             --            --                 --                  --              --
Vice President

</TABLE>

<PAGE>

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information about the beneficial ownership of our
common  stock as of  March  31,  2007,  by (i)  each  person  who we know is the
beneficial owner of more than 5% of the outstanding  shares of common stock (ii)
each  of our  directors  or  those  nominated  to be  directors,  and  executive
officers, and (iii) all of our directors and executive officers as a group.

                                    Amount and
                                    Nature                     Percentage
  Name and Address                  of Beneficial             of Common
  of Beneficial Owner               Ownership                 Stock(1)
--------------------------          -------------             ------------
Jesse Dobrinsky(2)(3)(4)
600 Bayview Avenue
Inwood, New York 11096               71,879,738                  6.34%

John L. Udell(3)(4)
600 Bayview Avenue
Inwood, New York 11096               71,879,738                  6.34%

Scott Goodman(3)
600 Bayview Avenue
Inwood, New York 11096               71,879,738                  6.34%

All officers and directors          215,639,214                 19.02%
                                    ===========                 ======

Jay Finkelstein(5)                   23,959,913                  2.11%


(1)   Applicable  percentage  of ownership is based on  1,132,915,616  shares of
      common stock  outstanding  as of March 31, 2007.  Beneficial  ownership is
      determined in accordance with the rules of the SEC and generally  includes
      voting or investment  power with respect to  securities.  Shares of common
      stock  subject to securities  exercisable  or  convertible  into shares of
      common stock that are currently  exercisable or  exercisable  December 31,
      2006 are  deemed  to be  beneficially  owned by the  person  holding  such
      options for the purpose of computing  the  percentage of ownership of such
      person,  but are not treated as  outstanding  for the purpose of computing
      the percentage ownership of any other person.

(2)   Jesse Dobrinsky has a proxy from Triple Crown  Consulting,  Inc., which is
      the holder of 517,500 Series IV Preferred shares  outstanding.  As such he
      has the right to vote  twenty  times the number of shares of common  stock
      that the Series IV Preferred  Stock is  convertible at such time as a vote
      is taken.

(3)   On May 12,  2005,  pursuant  to the  Stock  Purchase  Agreement  and Share
      Exchange between the Company,  Cargo Connection  Logistics Corp. and Cargo
      Connection  Logistics - International,  Inc. (f/k/a Mid-Coast  Management,
      Inc.),  these  shareholders  had an  agreement in place that they would be
      issued shares at the end of twelve  months from the effective  date of the
      Agreement so that these  shareholders would own a total of eighty (80%) of
      the outstanding shares of the Company at such time. Therefore,  on May 12,
      2006,  these  individuals  were  each  issued  143,960  shares of Series V
      Preferred,  each share has voting  rights  equivalent to common stock at a
      conversion  rate of 7,575 shares of common for each one share of preferred
      series V outstanding shares of the Company at such time.

(4)   These  individuals  are holders of 50,000  shares each,  respectively,  of
      Series III preferred stock.

(5)   See note 3 above with the exception that this individual was issued 47,987
      shares of Series V Preferred.

<PAGE>

Stock Options

The following table sets forth information with respect to stock options granted
to our named executive officers during fiscal year 2006 that have not been fully
amortized:

                        OPTION/SAR GRANTS IN FISCAL 2006
                               (INDIVIDUAL GRANTS)
<TABLE>
<CAPTION>

           NUMBER OF                % OF TOTAL OPTIONS/SARs
           SECURITIES UNDERLYING    GRANTED TO EMPLOYEES      EXERCISE      EXPIRATION
NAME       OPTIONs/SARs GRANTED     IN FISCAL YEAR 2006       PRICE         DATE
----       ---------------------    ----------------------    ---------     ------------
<S>        <C>                      <C>                       <C>           <C>
-None-
</TABLE>

The following table sets forth  information as to the number of shares of common
stock  underlying  unexercised  stock  options  and  the  value  of  unexercised
in-the-money stock options projected at the 2006 fiscal year end:

                        OPTION/SAR GRANTS IN FISCAL 2006
                               (INDIVIDUAL GRANTS)
<TABLE>
<CAPTION>

                 NUMBER OF                % OF TOTAL OPTIONS/SARs
                 SECURITIES UNDERLYING    GRANTED TO EMPLOYEES       EXERCISE     EXPIRATION
NAME             OPTIONs/SARs GRANTED     IN FISCAL YEAR 2006        PRICE        DATE
----             ---------------------    ----------------------    ---------     ------------

<S>               <C>                       <C>                       <C>         <C>
David Goldberg    100,000                   -0-                       $.03        June 30, 2007
</TABLE>



SERIES III CONVERTIBLE PREFERRED STOCK

<TABLE>
<CAPTION>

                          Number of
                          Shares of          Percent of        Number of Shares of
                          Series III         Series III        Common Stock Into
                          Convertible        Convertible       Which Series III
                          Preferred Stock    Preferred Stock   Convertible Preferred
                          Beneficially       Beneficially      Stock are
Name of Shareholder       Owned(1)           Owned             Convertible(2)
-------------------       --------           -----             --------------

<S>                       <C>                  <C>                <C>
Advantage Fund I, LLC     165,000              62.26%             165,000
Jesse Dobrinsky            50,000              18 87%              50,000
John L. Udell              50,000              18.87%              50,000
</TABLE>

(1)   Unless otherwise  indicated,  the persons or entities  identified in these
      tables have sole voting and  investment  power with  respect to all shares
      shown as  beneficially  held by them,  subject to community  property laws
      where applicable.

(2)   As of December 31, 2006.

<PAGE>

SERIES IV CONVERTIBLE PREFERRED STOCK

                       Number of
                       Shares of         Percent of        Number of Shares of
                       Series IV         Series IV         Common Stock Into
                       Convertible       Convertible       Which Series IV
                       Preferred Stock   Preferred Stock   Convertible
                       Beneficially      Beneficially      Preferred Stock
Name of Shareholder    Owned(1)          Owned             are Convertible(2)
-------------------    ---------------   ---------------   -------------------

Triple Crown
  Consulting, Inc.(3)   517,500          100%              123,214,285

(1)   Unless otherwise  indicated,  the persons or entities  identified in these
      tables have sole voting and  investment  power with  respect to all shares
      shown as  beneficially  held by them,  subject to community  property laws
      where applicable.

(2)   As of December 31, 2006

(3)   Benjamin Kaplan is the owner of Triple Crown Consulting, Inc.


SERIES V CONVERTIBLE PREFERRED STOCK

                       Number of
                       Shares of         Percent of         Number of Shares of
                       Series V          Series V           Common Stock Into
                       Convertible       Convertible        Which Series V
                       Preferred Stock   Preferred Stock    Convertible
                       Beneficially      Beneficially       Preferred Stock
Name of Shareholder    Owned(1)          Owned              are Convertible(2)
-------------------    --------          -----              ------------------

Jesse Dobrinsky         143,960          30%                1,090,497,000
Jay Finkelstein          47,987          10%                  363,501,525
Scott Goodman           143,960          30%                1,090,497,000
John L. Udell           143,960          30%                1,090,497,000

(1)   Unless otherwise  indicated,  the persons or entities  identified in these
      tables have sole voting and  investment  power with  respect to all shares
      shown as  beneficially  held by them,  subject to community  property laws
      where applicable.

(2)   As of December 31, 2006

<PAGE>

ITEM 12. - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Cargo Connection Logistics Corp. and Cargo Connection Logistics - International,
Inc.  (f/k/a  Mid-Coast  Management,  Inc.),  the  Company's  two  wholly  owned
subsidiaries,  have had transactions with a related party. The transactions were
with CDI  Management,  Inc.,  which is  controlled  by  Jesse  Dobrinsky,  Scott
Goodman,  John L. Udell and Jay Finkelstein.  Messrs.  Dobrinsky and Goodman are
officers, directors and shareholders of our Company. Mr. Udell is an officer and
shareholder of our Company. Mr. Finkelstein is a shareholder of our Company. CDI
furnished  both  rental  property  and  equipment  leases  for Cargo  Connection
Logistics Corp. The transactions for the past three years were:

Year                     Rental Property                Equipment Leases
--------------------------------------------------------------------------------
2006                      $ 516,825                        $ 28,800
2005                      $ 500,420                        $ 28,800
2004                      $ 461,680                        $ 28,800


Cargo Connection  Logistics Corp. has had transactions with a related party. The
transactions  were with Underwing  International,  LLC.,  which is controlled by
Jesse  Dobrinsky,  Scott  Goodman,  John L. Udell and Jay  Finkelstein.  Messrs.
Dobrinsky and Goodman are officers,  directors and  shareholders of our Company.
Mr. Udell is an officer and  shareholder  of our Company.  Mr.  Finkelstein is a
shareholder  of our  Company.  Underwing  furnished  equipment  leases for Cargo
Connection Logistics Corp. The transactions for the past three years were:

Year                                                 Equipment Leases
--------------------------------------------------------------------------------
2006                                                    $ 4,800
2005                                                    $ 4,800
2004                                                    $ 4,800


Cargo Connection  Logistics  Holdings,  Inc. has had transactions with a related
party. In October,  2005, Cargo Connection  Logistics Holdings,  Inc. was loaned
$75,000 by certain officers of the Company. This loan is collateralized  through
a convertible  note at an interest  rate of 15%. The certain  officers are Jesse
Dobrinsky,  Scott Goodman and John L. Udell.  Messrs.  Dobrinsky and Goodman are
officers, directors and shareholders of our Company. Mr. Udell is an officer and
shareholder of our Company.


Cargo  Connection  Logistics  Holding,  Inc. has had  transactions  with related
parties. On October 27, 2005, Cargo Connection  Logistics received funds through
the  sale of  certain  preferred  stock of the  Company.  The  Company  received
$100,000  from  certain  officers of the  Company in return for the  issuance of
Series III Preferred Stock. The certain officers are Jesse Dobrinsky and John L.
Udell.  Mr.  Dobrinsky is an officer,  director and shareholders of our Company.
Mr. Udell is an officer and shareholder of our Company.

<PAGE>

                                     PART IV

A. ITEM 13. EXHIBITS LIST AND REPORTS ON FORM 8-K

      (a) Reports on Form 8-K and Form 8K-A

On May 19, 2006 the Company filed an 8-K based upon  Non-Reliance  on Previously
Issued  Financial  Statements  or a Related  Audit Report or  Completed  Interim
Review

On December 6, 2006 the Company filed an 8-K based upon pursuant to an Agreement
and Plan of Acquisition  between the Company and Nuclear Material  Technologies,
Inc.

      (b)   Exhibits

3.1(1)   Articles of Incorporation

3.2(1)   By-laws

4.1(2)   Company 2005 Stock Incentive Plan

10.1(3)  Stock Purchase  Agreement and Share Exchange by and among  Championlyte
         Holdings, Inc., the Company and Mid-Coast Management, Inc. effective
         May 10, 2005

10.2(4)  Securities  Purchase  Agreement dated December 28, 2005, by and between
         the Company and Montgomery Equity Partners, Ltd.

10.3(4)  Secured  Convertible  Debenture  in  the  amount  of  $1,750,000  dated
         December 28, 2005

10.4(4)  Investor  Registration Rights Agreement dated December 28, 2005, by and
         between the Company and Montgomery Equity Partners, Ltd.

10.5(4)  Warrant for 2,000,000 shares dated December 28, 2005

10.6(4)  Security  Agreement dated December 28, 2005, by and between the Company
         and Montgomery Equity Partners, Ltd.

10.7(4)  Escrow  Agreement  dated  December 28, 2005,  by and among the Company,
         Montgomery Equity Partners, Ltd. and David Gonzalez, Esq.

10.8(4)  Subsidiary Security Agreement dated December 28, 2005, by and among the
         Company,  Mid-Coast  Management,  Inc. and Montgomery  Equity Partners,
         Ltd.

10.9(4)  Agreement  of  Lease,   dated  March  10,  2001,  by  and  between  CDI
         Management, Inc. and Cargo Connection Logistics Corp.

10.10(4) Commercial Lease Contract,  dated October 22, 2003, by and between M.D.
         Hodges Enterprises, Inc. and Cargo Connection Logistics Corp.

10.11(4) Lease, dated October 12, 2004, by and between Ralston Industries,  Inc.
         and Mid-Coast Management, Inc.

10.12(4) Agreement  of Lease,  dated  February  16,  2004,  by and  between  CDI
         Management, Inc. and Mid-Coast Management, Inc.

10.13(4) Industrial Multi-Tenant Lease, dated September 30, 2004, by and between
         AMB HTD-Beacon Centre, LLC and Cargo Connection Logistics Corp.

10.14(4) Commercial Lease  Agreement,  dated January 31, 2005, by and between MP
         Cargo ORD Property, LLC and Underwing International, LLC

14(4)    Code of Ethics

31.1     Certification of Jesse Dobrinsky pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2     Certification of Scott Goodman pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1     Certification of Jesse Dobrinsky pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2     Certification of Scott Goodman pursuant to 18 U.S.C. Section 1350 as
         adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(1)   Incorporated  by reference to the Company's Form 10-KSB  originally  filed
      with the  Securities  and  Exchange  Commission  on November 19, 1999 (SEC
      file: 000-28223).

(2)   Incorporated  by reference  to the  Company's  current  report on Form 8-K
      filed with the Securities and Exchange Commission on May 18, 2005.

(3)   Incorporated  by reference  to the  Company's  current  report on Form 8-K
      filed with the Securities and Exchange Commission on January 9, 2006.

(4)   Incorporated  by  reference  to  the  Company's  Form  SB-2   Registration
      Statement  filed with the Securities  and Exchange  Commission on February
      14, 2006.

10.1(3)     Stock  Purchase  Agreement  and Share  Exchange  by and among  Cargo
            Connection  Logistics  Holding,  Inc. and Nuclear Material Detection
            Technologies, Inc. Effective December 6, 2006.

Item 14. - Principal Accountant Fees and Services

Audit Fees

Friedman,  LLP provided  audit services for us for pertaining to our fiscal year
ended  December 31, 2006 and December 31, 2005.  The aggregate fees billed or to
be billed by Friedman,  LLP for the audit of our annual financial statements and
review of our unaudited interim condensed  consolidated financial statements was
$151,551  incurred  during our fiscal year ended  December 31, 2006 and $129,583
for fiscal year ended December 31, 2005.

Tax Fees

There were no fees  billed for our fiscal year ended  December  31, 2006 for any
professional tax advice or tax planning services rendered by Friedman, LLP.

All Other Fees

There were no fees  billed  for the fiscal  year  ended  December  31,  2006 for
professional  services  rendered by  Friedman,  LLP for all other  services  not
disclosed above.

<PAGE>

                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) 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.

Dated: April 4, 2007


                                 CARGO CONNECTION LOGISTICS HOLDING, INC.


                                 By: /s/ Jesse Dobrinsky
                                     ------------------------------------
                                     Jesse Dobrinsky,
                                     President and Chief Executive Officer



                                POWER OF ATTORNEY

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
this  Annual  Report  on Form  10-K has been  signed  on March  xx,  2007 by the
following persons on behalf of the Registrant, in the capacities indicated.


                               /s/ Jesse Dobrinsky
                              --------------------------------------------------
                              Jesse Dobrinsky, President, Chief Executive
                              Officer and Director (Principal Executive Officer)


                                /s/ Scott Goodman
                              --------------------------------------------------
                              Scott Goodman, Chief Financial Officer,
                              Chief Operating Officer and Director
                              (Principal Accounting and Financial Officer)

<PAGE>

                                  CERTIFICATION
                           OF CHIEF EXECUTIVE OFFICER
                       PURSUANT TO 18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jesse Dobrinsky, certify that:

1.         I have  reviewed  this  Form  10-KSB  of Cargo  Connection  Logistics
           Holding, Inc.;

2.         Based on my  knowledge,  this  report  does not  contain  any  untrue
           statement  of a  material  fact  or omit to  state  a  material  fact
           necessary to make the statements made, in light of the  circumstances
           under which such statements were made, not misleading with respect to
           the period covered by this report;

3.         Based on my knowledge, the financial statements,  and other financial
           information  included in this report,  fairly present in all material
           respects the  financial  condition,  results of  operations  and cash
           flows of the  small  business  issuer  as of,  and for,  the  periods
           present in this report;

4.         The small  business  issuer's other  certifying  officer(s) and I are
           responsible for establishing and maintaining  disclosure controls and
           procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
           and internal control over financial reporting (as defined in Exchange
           Act Rules 13-a-15(f) and 15d-15(f)) for the small business issuer and
           have:

(a)        Designed  such  disclosure  controls and  procedures,  or caused such
           disclosure   controls  and   procedures  to  be  designed  under  our
           supervision,  to ensure  that  material  information  relating to the
           small business issuer,  including its consolidated  subsidiaries,  is
           made known to us by others within those entities, particularly during
           the period in which this report is being prepared;

(b)        Designed such internal  control over financial  reporting,  or caused
           such internal  control over financial  reporting to be designed under
           our  supervision,  to provide  reasonable  assurance  regarding there
           liability of financial  reporting  and the  preparation  of financial
           statements  for  external   purposes  in  accordance  with  generally
           accepted accounting principals;

(c)        Evaluated the effectiveness of the small business issuer's disclosure
           controls and procedures and presented in this report our  conclusions
           about the effectiveness of the disclosure controls and procedures, as
           of the  end of the  period  covered  by  this  report  based  on such
           evaluation; and

(d)        Disclosed  in this report any change in the small  business  issuer's
           internal  control over financing  reporting that occurred  during the
           small  business  issuer's  most  recent  fiscal  quarter  (the  small
           business  issuer's  fourth  fiscal  quarter  in the case of an annual
           report) that has  materially  affected,  or is  reasonably  likely to
           materially  affect, the small business issuer's internal control over
           financial reporting; and

5.         The small business  issuer's other  certifying  officer(s) and I have
           disclosed,  based on our most recent  evaluation of internal  control
           over financial reporting, to the small business issuer's auditors and
           the audit committee of the small business issuer's board of directors
           (or persons performing the equivalent functions):

(a)        All significant deficiencies and material weaknesses in the design or
           operation of internal  control  over  financial  reporting  which are
           reasonably  likely to adversely  affect the small  business  issuer's
           ability  to  record,   process,   summarize   and  report   financial
           information; and

(b)        Any fraud, whether or not material, that involved management or other
           employees who have a significant role in the small business  issuer's
           internal control over financial reporting.


                                    Date: April 4, 2007



                                            By: /s/ Jesse Dobrinsky
                                            -----------------------
                                            Jesse Dobrinsky
                                            Chief Executive Officer



<PAGE>




                                  CERTIFICATION
                           OF CHIEF FINANCIAL OFFICER
                       PURSUANT TO 18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Scott Goodman, certify that:

1.         I have  reviewed  this  Form  10-KSB  of Cargo  Connection  Logistics
           Holding, Inc.;

2.         Based on my  knowledge,  this  report  does not  contain  any  untrue
           statement  of a  material  fact  or omit to  state  a  material  fact
           necessary to make the statements made, in light of the  circumstances
           under which such statements were made, not misleading with respect to
           the period covered by this report;

3.         Based on my knowledge, the financial statements,  and other financial
           information  included in this report,  fairly present in all material
           respects the  financial  condition,  results of  operations  and cash
           flows of the  small  business  issuer  as of,  and for,  the  periods
           present in this report;

4.         The small  business  issuer's other  certifying  officer(s) and I are
           responsible for establishing and maintaining  disclosure controls and
           procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
           and internal control over financial reporting (as defined in Exchange
           Act Rules 13-a-15(f) and 15d-15(f)) for the small business issuer and
           have:

(a)        Designed  such  disclosure  controls and  procedures,  or caused such
           disclosure   controls  and   procedures  to  be  designed  under  our
           supervision,  to ensure  that  material  information  relating to the
           small business issuer,  including its consolidated  subsidiaries,  is
           made known to us by others within those entities, particularly during
           the period in which this report is being prepared;

(b)        Designed such internal  control over financial  reporting,  or caused
           such internal  control over financial  reporting to be designed under
           our  supervision,  to provide  reasonable  assurance  regarding there
           liability of financial  reporting  and the  preparation  of financial
           statements  for  external   purposes  in  accordance  with  generally
           accepted accounting principals;

(c)        Evaluated the effectiveness of the small business issuer's disclosure
           controls and procedures and presented in this report our  conclusions
           about the effectiveness of the disclosure controls and procedures, as
           of the  end of the  period  covered  by  this  report  based  on such
           evaluation; and

(d)        Disclosed  in this report any change in the small  business  issuer's
           internal  control over financing  reporting that occurred  during the
           small  business  issuer's  most  recent  fiscal  quarter  (the  small
           business  issuer's  fourth  fiscal  quarter  in the case of an annual
           report) that has  materially  affected,  or is  reasonably  likely to
           materially  affect, the small business issuer's internal control over
           financial reporting; and

5.         The small business  issuer's other  certifying  officer(s) and I have
           disclosed,  based on our most recent  evaluation of internal  control
           over financial reporting, to the small business issuer's auditors and
           the audit committee of the small business issuer's board of directors
           (or persons performing the equivalent functions):

(a)        All significant deficiencies and material weaknesses in the design or
           operation of internal  control  over  financial  reporting  which are
           reasonably  likely to adversely  affect the small  business  issuer's
           ability  to  record,   process,   summarize   and  report   financial
           information; and A

(b)        Any fraud, whether or not material, that involved management or other
           employees who have a significant role in the small business  issuer's
           internal control over financial reporting.

                                    Date: April 4, 2007

                                    By: /s/ Scott Goodman
                                    ---------------------
                                    Scott Goodman
                                    Chief Financial Officer

<PAGE>

                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                       PURSUANT TO 18 U.S.C. SECTION 1350

In connection with the Annual Report of Cargo Connection Logistics Holding, Inc.
(the  "Company")  on Form 10-KSB for the year ending  December 31, 2006 as filed
with the Securities and Exchange Commission (the "Report"),  I, Jesse Dobrinsky,
Chief Executive Officer certify,  pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)   Such Annual Report on Form 10-KSB for the period ending December 31, 2006,
      fully  complies  with the  requirements  of Section 13(a) or 15 (d) of the
      Securities Exchange Act of 1934; and

(2)   The information contained such Annual Report on Form 10-KSB for the period
      ending December 31, 2006 fairly presents,  in all material  respects,  the
      financial  condition  of the  Company  as of the dates  presented  and the
      results of operations of the Company.


Dated: April 4, 2007

                                Cargo Connection Logistics Holding, Inc.

                                    By: /s/ Jesse Dobrinsky
                                    -----------------------
                                    Jesse Dobrinsky
                                    Chief Executive Officer

<PAGE>

                    CERTIFICATION OF CHIEF FINANCIAL OFFICER
                       PURSUANT TO 18 U.S.C. SECTION 1350

In connection with the Annual Report of Cargo Connection Logistics Holding, Inc.
(the  "Company")  on Form 10-KSB for the year ending  December 31, 2006 as filed
with the Securities and Exchange  Commission (the  "Report"),  I, Scott Goodman,
Chief Financial Officer certify,  pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)   Such Annual Report on Form 10-KSB for the period ending December 31, 2006,
      fully  complies  with the  requirements  of Section  13(a) or 15(d) of the
      Securities Exchange Act of 1934; and

(2)   The information contained such Annual Report on Form 10-KSB for the period
      ending December 31, 2006 fairly presents,  in all material  respects,  the
      financial  condition  of the  Company  as of the dates  presented  and the
      results of operations of the Company.

Dated: April 4, 2007

                             Cargo Connection Logistics Holding, Inc.



                                    By: /s/ Scott Goodman
                                    ---------------------
                                    Scott Goodman
                                    Chief Financial Officer