We continue to take a number of positive steps toward improving our short-term and long-term financial results. While growth in our Service Fee business is a key component, we have also taken steps to reduce our overall consolidated SG&A costs, which reflect a decrease on a year-over-year basis during the quarter. As Mark alluded to earlier, this combination of strong growth in our higher gross margin Service Fee business, combined with the impact of reduced SG&A costs, resulted in an improvement in our consolidated adjusted EBITDA for the June 2010 quarter of 1.7 million as compared to the prior year second quarter.

Let me spend a few minutes taking you through a recap of the results for the quarter as reported in our press release from this morning. Our consolidated revenue for the quarter ended June 30, 2010 increased slightly to 82.5 million, compared to 82.3 million for the quarter ended June 30, 2009. Increases in Service Fee revenue and pass-through revenues were almost entirely offset by decreases in product revenue for both our Supplies Distributors and eCOST business segments during the quarter.

Gross profit for the second quarter of 2010 was 9.0 million or 11.8% of net revenues excluding pass-through revenues as compared to 8.2 million or 10.5% of net revenue excluding pass-through revenue in the second quarter of 2009. As mentioned earlier, the gross margin increase was primarily due to the higher percentage of revenue generated from our Service Fee business compared to the second quarter of 2009. We utilized adjusted EBITDA as a key metric in evaluating our operational performance. In the second quarter, our adjusted — consolidated adjusted EBITDA was a positive 1.0 million, versus a loss of 0.7 million in the prior year. For the second quarter, net loss was 1.5 million or $0.14 per basic and diluted share compared to a net loss of approximately 2.5 million or $0.25 per basic and diluted share for the same period last year.

Let me share some additional comments on the performance of our select business segments for the quarter as well. First, Service Fee revenue increased as we talked about, 34% to 16.6 million as compared to 12.4 million in the prior year. Strong activity here related to new clients, organic growth at existing clients and incremental project work. Our increased gross profit in this business combined with relatively stable costs resulted in a significant improvement of 1.9 million in adjusted EBITDA for the segment as compared to the prior year.

As we look ahead into the third quarter, we currently expect our third quarter Service Fee revenue will continue to reflect strong increases on a year-over-year basis. However, the percentage increase is expected to be somewhat less than June quarter due to the impact of the previously disclosed non-renewal of one of Service Fee business-to-business client relationships.

For our Supplies Distributors business segment, revenue was 43.5 million in the second quarter of 2010, as compared to 45.3 million for the prior year. This decrease was primarily due to the impact of the euro — currency conversion rate. Our adjusted EBITDA results for this business was relatively constant as compared to the prior year and we continue to believe that this business will remain relatively stable in terms of product revenue in the near-term. And for eCOST.com revenue in the second quarter of 2010 was 16.2 million, compared to 20.3 million last year. As Mark indicated, most of this decrease related to the reduction in sales to our business-to-consumer customer segment. Our adjusted EBITDA for this business remains relatively constant as compared to the prior year, but was down as we compare the results on a sequential basis to the March 2010 quarter.

From a balance sheet perspective during the quarter, we strengthened our balance sheet by raising approximately $7.3 million of net proceeds through a public offering completed in May of 2.3 million shares of our common stock. This capital provides us increased flexibility to manage our businesses and plan to grow. This offering as well as the benefit of certain other positive cash flow items resulted in an increase to our cash and equivalents and restricted cash balance to $20.8 million as of June 30, as compared to 16.4 million as of March 31, 2010, as well as created a reduction in our debt balance of 18.6 million as compared to 21.8 million as of March 31, 2010.