marketing resources and experience. We cannot assure you that we will be able to effectively compete with our competitors in effecting our business expansion plans. The most significant trend contributing to our growth during the past four years has been the expansion of our brokerage services agent network and expansion of our contract carrier agent and owner operator network. Sales agents are independent contractors and, as such, there are no assurances that we can either maintain our existing agent network or continue to expand this network.

          For the six months ended June 30, 2008, our gross revenues increased to $81.8 million from $48.3 million in the prior year period. As of June 30, 2008, we had an accumulated deficit of $4.8 million. Factors that could adversely affect our operating results include:

          Depending on our ability to generate revenues, we may require additional funds to expand Sunteck’s business operations and for working capital and general corporate purposes. Any additional equity financing may be dilutive to stockholders, and debt financings may involve restrictive covenants that further limit our ability to make decisions that we believe will be in our best interests. In the event we cannot obtain additional financing on terms acceptable to us when required, our ability to expand Sunteck’s operations may be materially adversely affected.

          Inflation and changing prices had no material impact on our revenues or the results of operations for the period ended June 30, 2008. During the three months ended June 30, 2008, however, rapidly rising fuel prices, among other factors, contributed to higher transportation costs and resulted in a decline in the net revenue percentage.

Liquidity and capital resources

          During the past two years, our sources for cash have been the cash flow generated from operations and available borrowings under our line of credit.

          At June 30, 2008, we had an outstanding balance of $12,196,000 under our $20,000,000 line of credit. In May, 2008, we increased our line of credit from 10.5 million to 20.0 million and extended the maturity date from June 2009 to June, 2010. The line of credit facility is at an interest rate of LIBOR plus 1 ¼ %, is subject to the maintenance of certain financial covenants, and is secured by accounts receivable and other operating assets. We believe that we have sufficient working capital to meet our short-term operating needs and that we will be able to increase, extend or replace the line of credit on terms acceptable to us.

          At June 30, 2008, we had liquid assets of approximately $156,000. Available cash is used to reduce borrowings on our line of credit.

          The total amount of debt outstanding as of June 30, 2008 and 2007 was $12,196,000 and $3,363,000, respectively. The following table presents our debt instruments and their weighted average interest rates as of June 30, 2008 and 2007, respectively:

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Critical accounting policies

          Preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Note 1 to the notes to the financial statements included in this report includes a summary of the significant accounting policies and methods used in the preparation of our financial statements. The most significant areas involving management estimates and assumptions are described below. Actual results could differ materially from management’s estimates under different assumptions or conditions.

Revenue Recognition

          As a third party transportation logistics provider, we act as the shippers’ agent and arrange for a carrier to handle the freight. Gross revenues consist of the total dollar value of services purchased by shippers. Revenue is recognized upon the delivery of freight, at which time the related transportation cost, including commission, is also recognized. At that time, our obligations are completed and collection of receivables is reasonably assured.

          Emerging Issues Task Force No. 99-19, “Reporting Revenues Gross as a Principal Versus Net as an Agent” (EITF 99-19), establishes criteria for recognizing revenues on a gross or net basis. We are the primary obligor in our transactions, have all credit risk, maintain substantially all risk and rewards, have discretion in selecting the supplier, and have latitude in pricing decisions. Accordingly, we record all transactions at the gross amount, consistent with the provisions of EITF 99-19.

Income Taxes

          The deferred tax asset represents expected future tax savings resulting from our net operating loss carryforwards. As of December 31, 2007, we had net operating loss carryforwards of approximately $8.9 million for federal income tax purposes which expire through 2014. Utilization of this benefit is primarily subject to the extent of our future earnings, and may be limited by, among other things, stockholder changes, including the possible issuance of additional shares in one or more financing or acquisition transactions. As of December 2006, we eliminated any valuation allowance for the future tax savings as management believes it is more likely than not that they will be realized by the end of the carryforward period.

Provision For Doubtful Accounts

          We continuously monitor the creditworthiness of our customers and have established an allowance for amounts that may become uncollectible in the future based on current economic trends, our historical payment and bad debt write-off experience, and any specific customer related collection issues.

Off-balance sheet arrangements

          We do not have any off-balance sheet arrangements.

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