SecProbe.io

CORRESP
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filename1.htm

    Fox
Rothschild LLP

    P.O. Box
5231

    Princeton,
New Jersey  08648-2311

    Tel:  609-896-3600   Fax:  609-896-1469

    May 29, 2009

    VIA EDGAR & FEDEX
DELIVERY

    Linda
Cvrkel, Branch Chief

    U.S.
Securities and Exchange Commission

    100 F
Street, N.E.

    Mail Stop
3561

    Washington,
D.C. 20549

              Re:

              Radiant
      Logistics, Inc.

              Form
      10-K for fiscal year ended June 30, 2008

              Filed
      September 29, 2008

              Form
      10-Q for fiscal quarter ended December 31, 2008

              Filed
      February 13, 2009

              File
      No. 000-50283

    Dear Ms.
Cvrkel:

    We thank you for your comment letter
dated April 9, 2009 (the “Comment Letter”) addressed to Radiant Logistics, Inc.
(the “Company”).  The following is in response to the Staff’s Comment
Letter.  Each comment is included in bold below and is numbered to
correspond to the numbered paragraphs in the Comment Letter.  The
Company’s responses immediately follow each comment.

    Annual Report on Form 10-K
for the fiscal year ended June 30, 2008

    Management's Discussion and
Analysis of Financial Condition and Results of Operations,

    page 19

    Results of Operations, page
22

    Fiscal year ended June 30,
2008 compared to fiscal year ended June 30, 2007, page 22

    Overview, page
22

              1.

              We
      note your presentation of adjusted EBITDA.  If management
      believes that a credit agreement is a material agreement, that the
      covenant is a material term of the credit agreement and that information
      about the covenant is material to an investor's understanding of the
      company's financial condition and/or liquidity, then you should disclose
      those facts in addition to your presentation of the measure as calculated
      by the debt covenant in the liquidity section of MD&A.  You
      should also discuss the following:

          May 29, 2009

          Page 2 of
13

              -

              the
      materiality of the credit agreement and the
  covenant;

              -

              the
      amount or limit required for compliance with the covenant;
    and

              -

              the
      actual or reasonably likely effects of compliance or non-compliance with
      the covenant on the company's financial condition and
      liquidity.

    Discussion
of the non-GAAP financial measure for other purposes would not be permitted
unless otherwise allowable under Item 10(e) of Regulation S-K.  Please
refer to Questions 10 and 14 of "Frequently Asked Questions Regarding the Use of
Non-GAAP Financial Measures," prepared by Staff Members in the Division of
Corporation Finance, U.S. Securities and Exchange Commission, dated June 13,
2003 and revise future filings appropriately.

    The
Company uses the non-GAAP financial measurement of “adjusted EBITDA” as its
credit agreement includes a financial covenant of funded debt to adjusted EBITDA
of not more than 3.25.  The Company believes that the disclosure of
adjusted EBITDA is particularly material to its investors’ understanding of the
Company’s financial condition and liquidity as the Company’s ability to generate
adjusted EBITDA ultimately limits the amount of debt that it may carry and is a
good indicator of its financial flexibility and capacity to complete additional
acquisitions in compliance with the credit agreement.  A violation of
this covenant in the credit agreement would greatly limit the Company’s
financial flexibility, reduce available liquidity, and absent a waiver, could
give rise to an event of default under the credit agreement.  For the
forgoing reasons, the Company believes that the credit agreement is material to
its operations and that adjusted EBITDA is important to an evaluation of the
Company’s financial condition and liquidity.  As requested, the
Company will revise its future filings to reflect the forgoing.

      Executive Compensation, page
33

              2.

              We
      refer to footnotes 6 on page 33 and 8 on page 34.  Please tell
      us the nature and business purpose of the December 2005 agreement that
      resulted in the amortization of moving expenses over multiple fiscal
      years.  Your response should include how you originally
      accounted for such expenses, the original amount of the expenses, why it
      is appropriate to amortize the expenses, and tell us over how many years
      such amortization will continue.  Please include specific
      references to the relevant technical accounting literature which supports
      your conclusions in your response.

          2

            May 29, 2009

            Page 3
of 13

    As part
of negotiations to secure the employment services of Mr. Dan Stegemoller, on
December 1, 2005 Airgroup Corporation issued a note receivable in the amount of
$200,000 to Mr. Stegemoller representing funds for Mr. Stegemoller to move from
Phoenix, AZ to Seattle, WA as well as additional incentive to accept the
Company’s employment offer.  The agreement was that Mr. Stegemoller’s
note would accrue interest and be forgiven over a five year period on each
anniversary date at a rate of 20% per year.  The note receivable will
be fully amortized on December 1st, 2010 assuming Mr. Stegemoller continues his
employment.

              Financial Statements,
      page F-1

              Consolidated
      Statements of Cash Flows, page
F-6

              3.

              Please
      refer to the line item "Payment to former shareholders of Airgroup" under
      financing activities in the amount of $500,000 during the fiscal year
      ended June 30, 2008.  Based on your disclosures in note 4 – it
      appears this payment was part of the cash consideration paid for the
      acquisition of Airgroup.  If so, we are unclear as to why you
      have classified this payment as a financing activity rather than an
      investing activity.  Please advise and/or revise to properly
      classify this amount in investing activities in accordance with paragraph
      15 of SFAS 95.

    In
connection with the recording of initial transaction in January of 2006,
the  Company recognized the $500,000 obligation to the seller to be
paid on the second year anniversary of the closing of the transaction and
reflected this obligation as long-term debt on the balance sheet and a source of
financing on the cashflow statement.  The disbursement of funds
reflected on the cashflow statement for the year ended June 30, 2008 reflected
the satisfaction of this obligation. This presentation is consistent with
financing activities in accordance with paragraphs 19 (b) and 20 (b) of SFAS
95.

              Notes to the
      Consolidated Financial Statements, page
  F-8

              General

              4.

              We
      note from page 23 that the company generates domestic and international
      transportation revenues.  We further note that the company is
      involved in several different revenue streams with the acquisitions of
      Adcom and Airgroup.  Please tell us to what extent you
      considered the existence of newly acquired operating segments with regards
      to recent business combinations.  Refer to SFAS 131 and
      advise.  Furthermore, notwithstanding the above, please revise
      future filings to include the disclosures required by paragraphs 36
      through 39 of SFAS 131.

            3

              May 29, 2009

              Page 4
of 13

    Upon the
acquisition of Adcom, the Company considered SFAS 131 and concluded that no
separate reportable operating segment exists.  Adcom is similar to
Airgroup, sells the same products, and its business model is identical to
Airgroup’s.  In addition, the back-office operations historically
supporting the Adcom operations are being eliminated with all business being
managed from a single operating system and management team in Bellevue,
Washington.  Finally, the Company does not break out separate revenue
streams generated from the Adcom transaction for internal management analysis
nor external financial reporting.  As requested, the Company will
revise future filings to include the disclosures contemplated in paragraphs 36
through 39 of SFAS 13 as appropriate.

              Note 2 – Summary of
      Significant Accounting Policies, page
F-9

              j) Revenue Recognition
      and Purchased Transportation Costs, page
  F-11

              5.

              According
      to your revenue recognition footnote, we note that revenue from freight
      forwarding and export services is recognized at the time freight is
      tendered to the direct carrier at origin and that direct expenses
      associated with the cost of transportation are accrued
      concurrently.  We also note that at the time revenue is
      recognized on a shipment, you record costs related to that shipment based
      on the estimate of total purchase transportation costs.  In this
      regard, it appears that you may be recognizing revenue in advance of
      performance and costs prior to being incurred.  Further, it is
      unclear to us how your revenue recognition policy complies with any of the
      acceptable methods outlined in EITF No. 91-9.  Please tell us
      how your revenue and related expenses recognition policy complies with one
      of the acceptable methods prescribed in EITF No. 91-9, which provides that
      recognition of freight revenue should occur when shipment has been
      completed and expenses are incurred.  We may have further
      comment upon receipt of your
response.

    The
Company’s revenue recognition policy complies with method No. 2 of EITF No.
91-9.  As a non-asset based logistics provider, the Company has
substantially completed all work that is required in connection with the
recognition of the revenue at the time it tenders the freight to the underlying
asset-based carrier.  The underlying asset-based carrier is the
service provider actually responsible for delivering the goods and would more
likely have its revenue recognition policy tied to the ultimate
delivery.

    By way of
further background, EITF No.91-9 was written primarily to provide revenue
recognition guidelines for motor carriers and other asset-based transportation
providers that are responsible for the physical delivery of product to
customers. As a non-asset based logistics provider, the Company has completed
the work that is required in connection with its recognition of the revenue
(i.e. the selection of, and the ultimate tender of the freight to, the
underlying asset based carrier to execute the physical movement of the
goods).  Simplistically, the Company could be considered a “travel
agent for freight”. The Company derives its revenues principally from domestic
and international freight forwarding services using a wide range of
transportation modes, including air, ocean, truck and rail. As a non-asset based
carrier, the Company does not own or lease aircraft, ships or heavy-duty trucks.
Rather, the Company generates its revenues by purchasing transportation capacity
from independent air, ocean and overland transportation providers and reselling
that capacity to its customers.

            4

              May 29, 2009

              Page 5
of 13

    Revenue
and cost of services derived from the Company's air, ocean and overland freight
forwarding services are recognized at the time the freight departs the terminal
of origin (i.e. tendered to the underlying asset based carrier), one of the
methods authorized by Emerging Issues Task Force ("EITF") Issue No. 91-9,
Revenue and Expense Recognition for Freight Services in Process.  This
method generally results in recognition of revenues and gross profit earlier
than methods that do not recognize revenues until a proof of delivery is
received. Note, however, that the Company's consolidated results of operations
would not have been materially different if one of the other acceptable methods
under EITF 91-9 had been applied.

              Note 4 – Acquisitions
      – Airgroup, page F-13

              6.

              Reference
      is made to your disclosure regarding the adjustment of $1.4 million to
      reduce the estimate of accrued transportation costs resulting in the
      recognition of $1.4 million in other income.  Please explain to
      us in further detail the nature, facts and circumstances surrounding the
      adjustment, including why you believe it was appropriate to reduce the
      estimate during the quarter ended December 31, 2007.  As part of
      your response, tell us the amount that was originally booked and how you
      calculated or determined the requirement at time of acquisition and as of
      December 31, 2007.  We may have further comment upon receipt of
      your response.

    The
Company acquired Airgroup Corporation (“Airgroup”) in January of 2006 in a stock
based transaction.  There were approximately $5.0 million of
contingent (estimated) liabilities reflected as accrued transportation costs at
the date of acquisition.

    By way of
background, the initial recording of revenue and estimated transportation costs
associated with a particular shipment is initiated as a result of transactional
activity entered into the Company’s operating system by each of Airgroup’s 40
independent stations across North America.  These estimated costs of
purchased transportation are held as estimated liabilities until the underlying
invoice is received from the asset-based carrier and “matched” to the
transaction originally accrued.

            5

              May 29, 2009

              Page 6
of 13

    Although
most invoices are received on a timely basis, there can be significant delays in
the processing of a specific invoice depending on (1) the facts and
circumstances surrounding a particular shipment and/or (2) the efficiency of the
service provider’s back-office and their ability to generate an
invoice.  In some cases, the Company never receives an invoice for
previously accrued transportation costs.

    Airgroup’s
predecessor management team, based on their years of experience and desire to be
conservative, had historically carried these “orphaned” accrued transportation
costs for an extended period of time (in some cases five or more years) before
clearing them to earnings.

    With the
benefit of operating experience at Airgroup, management believes that a one year
horizon was more appropriate in managing the “orphaned” accruals as the
preponderance of any invoices to be received will be presented to the Company
for payment within 12 months of the service being provided. As of December 31,
2007, there was approximately $1.4 million in “orphaned” liabilities that
originated prior to January 1, 2006 (acquisition date) for which no invoice had
been received.  The Company required two years of operating experience
to draw the conclusion with respect to an appropriate time horizon.

    In
accordance with SAB.T.2A7, Loss Contingencies Assumed in a Business Combination
(SAB No. 92), the adjustment of the contingent liability was recognized as an
element of net income.  Management believes the best presentation of
this non recurring income item will be to reflect the adjustment amount as
“Other Income - Other” rather than include it as part of Income from
Operations.

              Note 6 – Acquisition
      of assets – Automotive, page
F-14

              7.

              Reference
      is made to the Asset Purchase Agreement with Mass.  It appears
      that although you refer to the acquisition as an asset purchase, it is
      actually an acquisition of a business for which you have accounted for
      under purchase accounting.  If so, please revise your notes in
      future filings to clarify this.  If this was not an acquisition
      of a b