Edgar Filing: PACEL CORP

Schedule 14A Information

Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934

Filed by Registrant [ X ]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ X ] Preliminary Proxy Statement

[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))

[ ] Definitive Proxy Statement

[ ] Definitive Additional Materials

[ ] Soliciting Material under Rule 14a-12

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PACEL CORP.

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(Name of Registrant as Specified In Its Charter)
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Payment of Filing Fee (Check the appropriate box):

[ X ] No fee required.

September 3, 2001

Dear Fellow Stockholder:

On behalf of the board of directors and management of PACEL Corp.
("PACEL"), we cordially invite you to attend the annual meeting of PACEL
stockholders. The meeting will be held at 10:00am., local time, on September
28,2001, at PACEL CORP. HEADQUARTERS, 8870 RIXLEW LANE, SUITE 201 The annual
meeting will include management's report to you on our fiscal year 2000
financial and operating performance.

The matters expected to be acted upon at the meeting are described in
the accompanying notice of annual meeting of stockholders and proxy statement.
An important aspect of the annual meeting process is the annual stockholder vote
on corporate business items. I urge you to exercise your rights as a stockholder
to vote and participate in this process.

Whether or not you plan to attend the annual meeting, PLEASE READ THE
ENCLOSED PROXY STATEMENT AND THEN COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AND
RETURN IT IN THE ACCOMPANYING POSTPAID RETURN ENVELOPE AS PROMPTLY AS POSSIBLE.
This will save PACEL additional solicitation expenses and will ensure that your
shares are represented at the annual meeting.

On behalf of your board of directors and management, I want to thank
you for your attention to this important matter and express my appreciation for
your confidence and support.

Very truly yours,

David E. Calkins
PRESIDENT AND CHIEF EXECUTIVE OFFICER

PACEL CORP.
8870 RIXLEW LANE
SUITE 201
MANASSAS, VIRGINIA 20109
(703) 257-4759

---------------------------

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 28, 2001
---------------------------

Notice is hereby given that the annual meeting of stockholders of PACEL
will be held at PACEL CORP. HEADQUARTERS AT 8870 RIXLEW LANE, SUITE 201 ,
MANASSAS, VIRGINIA], on September 28, 2001, at 10:00 am., local time.

At the annual meeting, stockholders will be asked to consider and vote
on the following proposals:

Proposal I. Election of four directors, each for a term of one
year;

Proposal II. The adoption of an amendment to PACEL's Articles
of Incorporation, as amended, to increase the number
of authorized shares of common stock from 150,000,000
shares, no par value, to 650,000,000 shares, no par
value;

Proposal III. Ratification of the appointment of Peter C. Cosmas
Co., CPA, as independent accountants for PACEL for
the year ending December 31, 2001;

and any other business that may properly come before the annual meeting and any
adjournments thereof. As of the date of this proxy statement, we are not aware
of any other business to come before the annual meeting. YOUR BOARD OF DIRECTORS
RECOMMENDS THAT YOU VOTE "FOR" EACH OF THE PROPOSALS.

The board of directors has fixed the close of business on August 31,
2001 as the record date for the annual meeting. This means that stockholders of
record at the close of business on that date are entitled to receive notice of
and to vote at the annual meeting and any adjournments thereof.

This notice of annual meeting of stockholders, proxy statement and form
of proxy are first being mailed to stockholders on or about September 14, 2001.
TO ENSURE THAT YOUR SHARES ARE REPRESENTED AT THE MEETING, PLEASE TAKE THE TIME
TO VOTE BY SIGNING, DATING AND MAILING THE ENCLOSED PROXY CARD WHICH IS
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. THE PROXY WILL NOT BE USED IF YOU
ATTEND AND VOTE AT THE ANNUAL MEETING IN PERSON. REGARDLESS OF THE NUMBER OF
SHARES YOU OWN, YOUR VOTE IS VERY IMPORTANT. PLEASE ACT TODAY.

Thank you for your continued interest and support.

By Order of the board of directors

F. Kay Calkins
CORPORATE SECRETARY

PACEL CORP.
8870 RIXLEW LANE
SUITE 201
MANASSAS, VIRGINIA 20109
(703) 257-4759

---------------------------

PROXY STATEMENT
---------------------------

ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 28, 2001
---------------------------

INTRODUCTION

The board of directors of PACEL is using this proxy statement to
solicit proxies from the holders of common stock of PACEL for use at PACEL's
annual meeting of stockholders and any adjournments thereof. The notice of
annual meeting of stockholders, this proxy statement and the enclosed form of
proxy are first being mailed to our stockholders on or about September 14, 2001.

INFORMATION ABOUT THE ANNUAL MEETING

TIME AND PLACE OF THE ANNUAL MEETING

Our annual meeting will be held as follows:

DATE: September 28, 2001
TIME: 10:00 am., local time
PLACE: PACEL CORP.
8870 RIXLEW LANE,
SUITE 201
MANASSAS, VA 20109

MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING

At the annual meeting, stockholders are being asked to consider and
vote on the following proposals:

Proposal I. Election of four directors, each for a term
of one year;

Proposal II. The adoption of an amendment to PACEL's
Articles of Incorporation, as amended, to
increase the number of authorized shares of
common stock from 150,000,000 shares, no par
value, to 650,000,000 shares, no par value;

Proposal III. Ratification of the appointment of Peter C.
Cosmas Co., CPA, as independent accountants
for PACEL for the year ending December 31,
2001;

and any other business that may properly come before the annual meeting and any
adjournments thereof. As of the date of this proxy statement, we are not aware
of any other business to be presented for consideration at the annual meeting
other than the matters described in this proxy statement.

WHO IS ENTITLED TO VOTE?

The board of directors has fixed the close of business on August 31,
2001, as the record date for the annual meeting. Only stockholders of record of
PACEL are entitled to receive notice of and to vote at the annual meeting and
any adjournments thereof. Each stockholder of record will be entitled to one
vote for each share of PACEL common stock held. On August 31, 2001,
118,818,920 shares of PACEL common stock were issued and outstanding and
entitled to vote at the annual meeting.

WHAT IF MY SHARES ARE HELD IN "STREET NAME" BY A BROKER?

If you are the beneficial owner of shares held in "street name" by a
broker, your broker, as the record holder of the shares, is required to vote the
shares in accordance with your instructions. If you do not give instructions to
your broker, your broker may nevertheless vote the shares with respect to
"discretionary" items, but will not be permitted to vote your shares with
respect to "non-discretionary" items, pursuant to current industry practice. In
the case of non-discretionary items, the shares will be treated as "broker
non-votes." PACEL believes that Proposal II - the adoption of an amendment to
our Articles of Incorporation - may be treated as a non-discretionary item.

HOW MANY SHARES MUST BE PRESENT TO HOLD THE MEETING?

A quorum must be present at the meeting for any business to be
conducted. The presence at the meeting, in person or by proxy, of the holders of
a majority of the shares of PACEL common stock outstanding on the record date
will constitute a quorum. Proxies received but marked as abstentions or broker
non-votes will be included in the calculation of the number of shares considered
to be present at the meeting.

WHAT IF A QUORUM IS NOT PRESENT AT THE MEETING?

If a quorum is not present at the scheduled time of the meeting, a
majority of the stockholders present or represented by proxy may adjourn the
meeting until a quorum is present. The time and place of the adjourned meeting
will be announced at the time the adjournment is taken, and no other notice will
be given. An adjournment will have no effect on the business that may be
conducted at the meeting.

VOTE REQUIRED TO APPROVE PROPOSAL I: ELECTION OF FOUR DIRECTORS

Four directors are to be elected to serve for a one-year term expiring
at the annual meeting of stockholders held in 2002, or until their successors
are duly elected in accordance with the Articles of Incorporation.

Directors are elected by a plurality of the votes cast, in person or by
proxy, at the annual meeting by holders of PACEL common stock. This means that
the four director nominees with the most affirmative votes will be elected to
fill the available seats. Shares that are represented by proxy which are not
voted whether by broker non-vote or votes withheld will have no effect on the
election of directors.

If a director nominee is unable to stand for election, the board of
directors may either reduce the number of directors to be elected or select a
substitute nominee. If a substitute nominee is selected, the proxy holders will
vote your shares for the substitute nominee, unless you have withheld authority.
THE PACEL BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" ELECTION
OF EACH OF THE DIRECTOR NOMINEES.

VOTE REQUIRED TO APPROVE PROPOSAL II:
THE ADOPTION OF AN AMENDMENT TO OUR ARTICLES OF INCORPORATION

Adoption of an amendment to PACEL's Articles of Incorporation to
increase the number of authorized shares of common stock requires the
affirmative vote of more than two thirds of the shares outstanding and entitled
to vote as of the record date. Stockholder abstentions and broker non-votes on
the proposal to adopt an amendment to our Articles of Incorporation will have
the same effect as a vote against the proposal. THE PACEL BOARD OF DIRECTORS
UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE PROPOSAL TO AMEND OUR ARTICLES OF
INCORPORATION.

-2-

VOTE REQUIRED TO APPROVE PROPOSAL III:
RATIFICATION OF OUR INDEPENDENT ACCOUNTANTS

Ratification of the appointment of Peter C. Cosmas Co., CPAs as our
independent accountants for the fiscal year ending December 31, 2001 requires
the affirmative vote of the majority of shares cast, in person or by proxy, at
the annual meeting by holders of PACEL common stock. Stockholder abstentions on
the proposal to ratify the appointment of Peter C. Cosmas Co., CPAs as our
independent accountants will have the same effect as a vote against the
proposal, while broker non-votes will have no effect on the outcome of the vote.
THE PACEL BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE
PROPOSAL TO RATIFY PETER C. COSMAS CO., CPAS AS OUR INDEPENDENT ACCOUNTANTS FOR
THE FISCAL YEAR ENDING DECEMBER 31, 2001.

HOW TO VOTE AT THE ANNUAL MEETING

You may vote in person at the annual meeting or by proxy. To ensure
your representation at the annual meeting, we recommend you vote by proxy even
if you plan to attend the annual meeting. You can always change your vote at the
meeting. See "How to Revoke Your Proxy" below.

The persons named in the proxy will have the discretion to vote on any
other business properly presented for consideration at the annual meeting in
accordance with their best judgment. As of the date of the proxy statement, we
are not aware of any other matters to be presented at the annual meeting other
than those described in this proxy statement and the notice of annual meeting of
stockholders accompanying the proxy statement.

You may receive more than one proxy card depending on how your shares
are held. For example, you may hold some of your shares individually, some
jointly with your spouse and some in trust for your children -- in which case
you will receive three separate proxy cards to vote. Please sign and return all
proxy cards you receive.

HOW TO REVOKE YOUR PROXY

You may revoke your proxy before it is voted by:

o submitting a new proxy with a later date,

o notifying the Corporate Secretary of PACEL in writing before
the annual meeting that you have revoked your proxy, or

o voting in person at the annual meeting.

If you plan to attend the annual meeting and wish to vote in person, we
will give you a ballot at the annual meeting. However, if your shares are held
in the name of your broker, bank or other nominee, you must bring a letter from
the nominee indicating that you were the beneficial owner of PACEL common stock
on August 31, 2001, the record date for voting at the annual meeting.

PROXY SOLICITATION COSTS

PACEL will pay the costs of soliciting proxies. PACEL will handle the
distribution of proxy materials and solicitation of votes.. In addition to this
solicitation by mail, our directors, officers and employees may also solicit
proxies personally, electronically or by telephone but will not be specially
compensated for such solicitation activities. We will also reimburse brokers and
other custodians, fiduciaries and nominees for their reasonable expenses in
sending these materials to you.

-3-

OWNERSHIP OF PACEL COMMON STOCK

STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

The following table presents information regarding the beneficial
ownership of PACEL common stock as of August 31, 2001 by:

o each director of PACEL;

o the Chief Executive Officer of PACEL; and

o all of the executive officers and directors of PACEL as a group.

No other person or entities (or group of affiliated persons or entities) are
known by management to beneficially own more than five percent of the
outstanding common stock of PACEL.

The persons named in this table have sole voting power for all shares
of common stock shown as beneficially owned by them, subject to community
property laws where applicable and except as indicated in the footnotes to this
table. Beneficial ownership is determined in accordance with the rules of the
SEC. In computing the number of shares beneficially owned by a person and the
percentage ownership of that person, shares of common stock subject to
outstanding options held by that person that are currently exercisable, or
exercisable within 60 days after August 31, 2001, are deemed outstanding. These
shares, however, are not deemed outstanding for the purpose of computing the
percentage ownership of any other person. As of August 31, 2001, there were
118,818,920 shares of PACEL common stock outstanding.]

------------------------------

AMOUNT AND NATURE OF
COMMON STOCK
BENEFICIALLY OWNED(1)
------------------------------

NUMBER OF
SHARES PERCENT
BENEFICIALLY OF
NAME OF BENEFICIAL OWNER OWNED CLASS
---------------------------------- ------------------ -----------

Directors:
---------------------------------- ------------------ -----------

David E. Calkins(2) 4,024,031 11.70%
---------------------------------- ------------------ -----------

F. Kay Calkins(2) 3,274,031 11.70
---------------------------------- ------------------ -----------

Keith P. Hicks(3) 320,091 1.00
---------------------------------- ------------------ -----------

Corey M. LaCross 28,983 .09
---------------------------------- ------------------ -----------

All officers and directors
as a group (6 persons) 8,438,886 22.83
---------------------------------- ------------------ -----------

(1) Except as otherwise noted in these footnotes, the nature of beneficial
ownership for shares reported in this table is sole voting and
investment power. Included in the shares beneficially owned are options
to purchase 2,024,031 shares of PACEL common stock granted to directors
and executive officers.

(2) David E. Calkins and F. Kay Calkins are husband and wife. In the
aggregate they beneficially own 7,298,062 shares of PACEL common stock.
Included in their individual amounts is the right of each of Mr. and
Ms. Calkins to acquire 500,000 shares of common stock upon conversion
of their 500,000 shares of 1997 Class A preferred stock and the right
to acquire 2,024,031 shares upon exercise of outstanding stock options.

(3) Includes 4,375 shares held solely by Mr. Hick's spouse.

-4-

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires PACEL
directors and executive officers, and persons who own more than 10% of PACEL's
common stock to report their initial ownership of PACEL's common stock and any
subsequent changes in that ownership to the SEC. Specific due dates for these
reports have been established by the SEC and PACEL is required to disclose in
this proxy statement any late filings or failures to file.

PACEL believes, based solely on a review of the copies of such reports
furnished to us and written representations that no other reports were required
during the fiscal year ended December 31, 2000, all Section 16(a) filing
requirements applicable to our executive officers, directors and greater than
10% beneficial owners were complied with.

PROPOSAL I - ELECTION OF DIRECTORS

Our board of directors is presently composed of four members. Directors
of the Company are generally elected to serve for a one year term or until their
respective successors shall have been elected and shall qualify.

The table below sets forth information regarding our board of
directors, including their age, position with PACEL and term of office. Each
director nominee has consented to being named in this proxy statement and has
agreed to serve if elected. If a nominee is unable to stand for election, the
board of directors may either reduce the number of directors to be elected or
select a substitute nominee. If a substitute nominee is selected, the proxy
holders will vote your shares for the substitute nominee, unless you have
withheld authority. At this time, we are not aware of any reason why a nominee
might be unable to serve if elected.

Except as disclosed in this proxy statement, there are no arrangements
or understandings between any nominee and any other person pursuant to which
such nominee was selected. The board of Directors recommends you vote "FOR" each
of the director nominees.

--------------------- --------------- ---------------------------- ------------ -------------

AGE AS
OF THE ELECTED TERM
NAME RECORD DATE POSITION(S) HELD DIRECTOR EXPIRES
--------------------- --------------- ---------------------------- ------------ -------------

NOMINEES
--------------------- --------------- ---------------------------- ------------ -------------

David E. Calkins 57 Chief Executive Officer 1994 2002
--------------------- --------------- ---------------------------- ------------ -------------

F. Kay Calkins 43 Vice President and COO 1998 2002
--------------------- --------------- ---------------------------- ------------ -------------

Keith P. Hicks 76 Director 1998 2002
--------------------- --------------- ---------------------------- ------------ -------------

Corey M. LaCross 36 Director 2000 2002
--------------------- --------------- ---------------------------- ------------ -------------

Set forth below is the principal occupation of each of the nominees for
director of PACEL All nominees have held their present positions for at least
five years unless otherwise indicated.

DAVID E. CALKINS. David E. Calkins founded PACEL in 1994 and is its
Chairman, President and Chief Executive Officer. From 1992 until founding PACEL,
Mr. Calkins was the Regional Manager of three divisions of Pacific Nuclear (now
known as Vectra Technologies, Inc.), an engineering and information services
company and a Nasdaq Stock Market listed company. Vectra Technologies provides
power plant modifications, maintenance support and nuclear fuel handling to
utility companies and the United States Department of Energy (DOE). From 1987 to
1993, Mr. Calkins served as Project Manager, Program Director, Vice
President-Operations, and Executive Vice President Business Development for PRC
Inc., an information systems development and services company. PRC provides
support services to the Federal government and the utility industry.

-5-

F. KAY CALKINS. F. Kay Calkins is currently a Director of PACEL and was
Chief Operating Officer, Treasurer and Secretary until September 1, 1999,
positions she held since 1996. Ms. Calkins is also a Director and the President
and Chief Executive Officer of PACEL's 80 percent-owned subsidiary,
E-Business-Stor.Com. Prior to joining PACEL, Ms. Calkins was the President and
Chief Executive Officer of CMC Services, Inc., a consulting company offering
technical support to industry and 8(a) firms from 1993 to 1996.

KEITH P. HICKS. Keith P. Hicks is a retired Captain of the U.S. Army
with over 20 active years of service. Mr. Hicks served as an Ordinance Advisor
to the British and French Free Army during World War II. He was a Squadron
Commander in Korea in 1955 and 1956, and served in the Executive Office to the
Inspector General and the Office of Special Investigations in 1960 and 1961.
Upon retiring from the military in 1961, Mr. Hicks started a private
investigation business in the Commonwealth of Virginia, which became one of the
top investigative firms in the state with over 60 agents. Mr. Hicks also served
as the Chief Deputy Sheriff of Fairfax County from 1962 to 1969. Mr. Hicks has
owned and managed Hicks Cattle Company since 1962, running over 200 head of beef
cattle. In 1972 he formed and continues to manage Hicks Bonding Company and has
been the owner/operator of Hick's Auctioning Company since 1991. Mr. Hicks is
also a 25-year co-owner in a successful real estate company, C&H Properties
Investments. He has been on the board of directors of Xybernaut, Inc. a high
technology computer manufacturer of body worn, voice activated computers since
July 1994. He is a graduate of the University of Denver (BA 1954) and LaSalle
University School of Law (LL.B. 1969).

COREY M. LACROSS. Corey LaCross is currently an Industrial Engineer
Manager for United Parcel Service. Mr. LaCross joined UPS in 1984 where he has
held various operation assignments. His most recent assignment has been as the
Southeast Region Industrial Engineer Planning Manager. In this position he is in
charge of managing the corporate and region cost initiatives for all production
elements. This job also involves planning, technology training, vehicle
management, and logistics. In 1987, Mr. LaCross received his B.S. degree in
Business from Francis Marion University. In 1996 he received an A.T. degree from
ICS College in Industrial Engineering Technology. In 1998 he began working on
his M.B.A. at Charleston Southern University. He is also an active member on the
Institute of Industrial Engineers and was recently nominated to the Lexington
Who's Who of executive employees. Mr. LaCross is the grandson of Keith Hicks, a
director of PACEL.

MEETINGS AND COMMITTEES

MEETINGS

Meetings of the board of directors of PACEL are generally held every
two months. Meetings of the board of directors of E-Business-Stor.Com, of which
PACEL owns 80%, are generally held bi-monthly. The PACEL board of directors
conducted 5 regular meetings and 1special meetings during 2000. Each director
attended at least 75% of PACEL's board meetings and any committees on which he
or she served.

COMMITTEES

The board of directors of PACEL has two standing committees: the audit
committee and the compensation committee.

The Audit Committee's function is to review the results of the audit of
the Company performed by the independent public accountants, to review and
evaluate internal accounting controls and to recommend the selection of
independent public accountants. The Audit Committee is also authorized to
conduct such reviews and examinations as it deems necessary with respect to its
independent public accountants, including the availability of Company records,
information and personnel.. The Audit Committee is composed Messrs. Hicks and
LaCross In fiscal 2000, this committee met 2 times.

The compensation committee determines the salaries and incentive
compensation of PACEL's officers and provides recommendations for the salaries
and inventive compensation of other employees and consultants. The compensation
committee also administers PACEL's various incentive compensation, stock and
benefit plans. The compensation committee consisted of Messrs. Hicks and
LaCross, and met 2 times during 2000.

-6-

REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

THE FOLLOWING REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
SHALL NOT BE DEEMED TO BE SOLICITING MATERIAL OR TO BE INCORPORATED BY REFERENCE
BY ANY GENERAL STATEMENT INCORPORATING BY REFERENCE THIS PROXY STATEMENT INTO
ANY FILING UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES EXCHANGE ACT OF
1934, EXCEPT TO THE EXTENT PACEL CORP. SPECIFICALLY INCORPORATES THIS REPORT
THEREIN, AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH ACTS.

We have reviewed and discussed with management the Company's audited
consolidated financial statements for the fiscal year ended December 31, 2000.
We have discussed with the independent auditors the matters required to be
discussed by Statement on Auditing Standards NO. 61 (Communication with Audit
Committees).

We have also received the written disclosures and the letter from Peter
C. Cosmas Co. CPAs required by Independence Standards Board Standard No. 1
(Independence Discussion with Audit Committees) and have discussed the
independence of Peter C. Cosmas Co. CPAs with that firm.

Based on our review and discussions noted above, we recommended to the
Board of Directors that the Company's audited financial statements be included
in the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2000.

Submitted By: Messrs. Hicks and LaCross

DIRECTOR COMPENSATION

PACEL does not currently separately compensate its directors who are
employees of PACEL. Non- employee directors of PACEL were entitled to receive an
annual retainer of $5,400 for service on PACEL's board of directors during 2000,
payable quarterly in arrears. To date, our non-employee directors have not been
paid for their board service. We anticipate issuing restricted shares of PACEL
common stock equal to, and in lieu of, the amount of fees they are currently
owed.

-7-

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table sets forth summary information concerning
compensation awarded to, earned by or paid to David Calkins, our chief executive
officer, and to F. Kay Calkins, President of our subsidiary E-Business-Stor.com,
for the year ended December 31, 2000. Mr. Calkins and Ms. Calkins each received
perquisites and other personal benefits in addition to salary and bonus during
the periods stated. The aggregate amount of these perquisites and other personal
benefits, however, did not exceed the lesser of $50,000 or 10% of the total of
their annual salary and bonus and, therefore, have been omitted as permitted by
the rules of the SEC.

---------------------------------- ------------------------------------- ------------------ ------------------
ANNUAL COMPENSATION LONG TERM
COMPENSATION
AWARDS
---------------------------------- ---------- -------------- ----------- ------------------ ------------------
NAME AND PRINCIPAL POSITION FISCAL SALARY BONUS SECURITIES ALL OTHER
---------------------------------- YEAR ($) ($) UNDERLYING COMPENSATION
OPTIONS
(#) ($)
---------------------------------- ---------- -------------- ----------- ------------------ ------------------
DAVID E. CALKINS

CHIEF EXECUTIVE OFFICER 2000 $124,996 $--- 1,399,031(1) $---
1999 94,250 --- 625,000 ---
1998 84,000 --- --- ---
---------------------------------- ---------- -------------- ----------- ------------------ ------------------
F. KAY CALKINS
PRESIDENT, E-BUSINESS-STOR.COM 2000 $115,415 $--- 1,399,031(1) $---
1999 90,500 --- 625,000 ---
1998 77,00 --- --- ---
---------------------------------- ---------- -------------- ----------- ------------------ ------------------

OPTION GRANTS IN FISCAL YEAR 2000

The following table shows information with respect to the grant of
options to Mr. Calkins and to Ms. Calkins for the year ended December 31, 2000.
The options were granted under PACEL's existing Stock Option Plan.

--------------------------------------------------------------------------------------------------------------------

INDIVIDUAL GRANTS
------------------------ ------------------------- ------------------------ ------------------ ---------------------

NUMBER OF % OF TOTAL
SECURITIES OPTIONS GRANTED TO
NAME UNDERLYING EMPLOYEES EXERCISE PRICE EXPIRATION
OPTIONS GRANTED (#) IN FISCAL YEAR ($/SHARE) DATE
------------------------ ------------------------- ------------------------ ------------------ ---------------------

David E. Calkins 1,399,031(1) 50% $.21 February 13, 2005
------------------------ ------------------------- ------------------------ ------------------ ---------------------

F. Kay Calkins 1,399,031(1) 50% $.21 February 13, 2005
------------------------ ------------------------- ------------------------ ------------------ ---------------------

(1) Granted at the fair market value on the date of grant, vested
immediately and expire 10 years from the date of grant.

2000 FISCAL YEAR-END OPTION VALUES

The following table summarizes certain information relating to stock
options held by Mr. Calkins and Ms. Calkins during 2000 and the value of such
options at December 31, 2000. Value realized upon exercise is the difference
between the fair market value of the underlying stock on the exercise date and
the exercise price of the option. The value of an unexercised, in-the-money
option at fiscal year-end is the difference between its exercise price and the
fair market value of the underlying stock on December 31, 2000, which was $0.033
per share, based on the closing price of PACEL common stock as reported on the
Over-the- Counter Electronic Bulletin Board. These values have not been, and may
never be, realized. These options have not been, and may never be, exercised.
Actual gains, if any, on exercise will depend on the value of PACEL common stock
on the date of exercise. Unexercisable options are those which have not yet
vested.

-8-

---------------------------------------------------------- ------------------------------------ ------------------------------------

NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS AT
FISCAL YEAR-END (#) FISCAL YEAR-END ($)
---------------------------------------------------------- ------------------------------------ ------------------------------------

SHARES VALUE
ACQUIRED REALIZED
NAME ON EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---------- ------------------ --------- ------------------ ------------------------------------ -------------
---------------------- -------------------- -------------- ------------------ ----------------- ------------------ -----------------

David E. Calkins --0 0 --- 2,024,031 0 --- $0.00 0---
---------------------- -------------------- -------------- ------------------ ----------------- ------------------ -----------------
F. Kay Calkins ---0 0 --- 2,024,031 0 --- $0.00 -0--
---------------------- -------------------- -------------- ------------------ ----------------- ------------------ -----------------

EMPLOYMENT AGREEMENT

David Calkins, PACEL's Chairman, President and Chief Executive Officer
has an employment agreement with PACEL. The employment agreement is for an
initial term of two years, which commenced on January 1, 2001, with the right of
the parties to extend the agreement for two one-year periods by mutual consent
of the parties. Under his employment agreement, Mr. Calkin is entitled to
receive an annual base salary of $175,000 per year and annual increases at least
equal to the increase in the cost of living index. In addition, following the
termination of his employment, the agreement provides for continuation of
medical insurance benefits for a period of ten years and the assignment of key
man life insurance, if any. The agreement also contains various provisions for
the protection of PACEL, including non-solicitation and non-competition
provisions, and provides for the grant of options equal to 10% of PACEL's
outstanding common stock upon the company meeting certain performance goals.

F. Kay Calkins, EBStor's President and Chief Executive Officer has an
employment agreement with PACEL. The employment agreement is for an initial term
of two years, which commenced on January 1, 2001, with the right of the parties
to extend the agreement for two one-year periods by mutual consent of the
parties. Under the employment agreement, Ms. Calkins is entitled to receive an
annual base salary of $160,000 per year and annual increases at least equal to
the increase in the cost of living index. In addition, following the termination
of her employment, the agreement provides for continuation of medical insurance
benefits for a period of ten years and the assignment of key man life insurance,
if any. The agreement also contains various provisions for the protection of
PACEL and EBStor, including non-solicitation and non-competition provisions, and
provides for the grant of options equal to 10% of PACEL's outstanding common
stock upon the company meeting certain performance goals.

PROPOSAL II - APPROVAL OF AMENDMENT TO PACEL'S ARTICLES OF INCORPORATION

The board of directors of PACEL has approved and recommends to the
stockholders an amendment to the Articles of Incorporation which would increase
the number of shares of the common stock authorized for issuance from 40 million
to 150 million shares. As of August 31, 2001, 118,818,920 shares of common stock
were issued and outstanding and 5,250,000 shares were reserved for options of
PACEL common stock.

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The principal purpose for the proposed amendment is to give PACEL
greater flexibility in its financial affairs by making these additional shares
of common stock available for issuance by PACEL in such transactions and at such
times as the board of directors considers appropriate, whether in public or
private offerings, as stock splits or dividends or in connection with mergers
and acquisitions or otherwise. The stockholders of PACEL may or may not be given
the opportunity to vote on such a transaction, depending on the nature of the
transaction, applicable law, and the judgment of the PACEL's board of directors
regarding the submission of such transaction to a vote of the stockholders.
PACEL has no present plans, understandings or agreements for the issuance or use
of the proposed additional shares of common stock. Because stockholders do not
have preemptive rights under PACEL's Articles of Incorporation, the interests of
existing stockholders may (depending on the particular circumstances in which
additional capital stock is issued) be diluted by any such issuance.

It is possible that additional shares of PACEL's common stock could be
issued for the purpose of making an acquisition by an unwanted suitor of a
controlling interest in PACEL more difficult, time-consuming or costly or to
otherwise discourage an attempt to acquire control of PACEL. Under such
circumstances, the availability of authorized and unissued shares may make it
more difficult for stockholders to obtain a premium for their shares. Such
authorized and unissued shares could be used to create voting or other
impediments or to frustrate a person or other entity seeking to obtain control
of PACEL by means of a merger, tender offer, proxy contest or other means. For
instance, such shares could be privately placed with purchasers who might
cooperate with the PACEL board of directors in opposing an attempt by a third
party to gain control of PACEL by voting such shares against the transaction
with the third party or could be used to dilute the stock ownership or voting
rights of a person or entity seeking to obtain control of PACEL. Although the
Company's board of directors does not currently anticipate issuing additional
shares of common stock for purposes of preventing a takeover of the Company, the
Company's board of directors reserves its right (consistent with its fiduciary
responsibilities) to issue shares for such purpose.

Adoption of the proposed amendment requires the affirmative vote of
two-thirds of the total shares outstanding and entitled to vote at the Annual
Meeting. As soon as practicable after such affirmative vote has been taken and
certified, the amendment will be filed with the Virginia State Corporation
Commission and will thereupon become effective. PACEL currently has no plans for
a public offering of its common stock, but has indicated the possible need to
raise additional capital in the near future and will make application to list
the additional shares at such time and in such manner as may be required by the
Over-the-Counter Electronic Bulletin Board. If stockholders do not approve this
amendment, PACEL will be limited in its ability to raise additional capital in
the future, which could have an adverse effect on the future results of the
company.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" APPROVAL OF THE
AMENDMENT TO PACEL'S ARTICLES OF INCORPORATION.

PROPOSAL III - RATIFICATION OF THE APPOINTMENT OF INDEPENDENT ACCOUNTANTS

The Board of Directors has renewed the Company's arrangement for Peter
C. Cosmas Co. CPAs to be its auditors for the fiscal year ended December 31,
2001 , subject to the ratification of the Company's stockholders. A
representative of Peter C. Cosmas, Co. CPAs is expected to attend the Meeting to
respond to appropriate questions and will have an opportunity to make a
statement if he or she so desires.

AUDIT FEES

Aggregate fees billed by Peter C. Cosmas Co. CPAs for professional
services rendered for the audit of the Company's financial statements for fiscal
2000 and the review of the financial statements included in the Company's
quarterly reports on Form 10-QSB for the fiscal year were $16,000.00.

ALL OTHER FEES

Other than audit fees, the aggregate fees billed to the Company by
Peter C. Cosmas Co. CPAs for fiscal 2000 were $2,775. The Company did not incur
any fees related to financial information systems design and implementation.

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The Audit Committee of the Board of Directors has considered whether
the providing of all non-auditing services (and the aggregate fees billed for
such services) in fiscal year 2000 by Peter C. Cosmas Co. CPAs, the principal
independent auditors, is compatible with maintaining the principal auditors'
independence.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE RATIFICATION
OF THE APPOINTMENT OF PETER C. COSMAS CO. CPAS, AS PACEL'S INDEPENDENT
ACCOUNTANTS FOR THE YEAR ENDING DECEMBER 31, 2001.

STOCKHOLDER PROPOSALS

In order to be eligible for inclusion in next year's proxy materials
for the annual meeting of stockholders, any stockholder proposal to take action
at such meeting must be received at our main office located at 8870 Rixlew Lane,
Suite 201, Manassas, Virginia 20109, on or before November 30, 2001. To be
considered for presentation at next year's annual meeting, although not included
in the proxy statement, any stockholder proposal must be received at our main
office not less than 45 days prior to the annual meeting; provided, however, if
less than 30 days notice of the date of next year's annual meeting is given to
stockholders, the stockholder proposal must be received on or before the close
of business on the 10th day following the day on which the notice of the date of
the annual meeting was mailed.

All stockholder proposals for inclusion in PACEL's proxy materials may
be subject to the requirements of the proxy rules adopted under the Securities
Exchange Act 1934 and, as with any stockholder proposal, regardless of whether
it is included in our proxy materials, PACEL's articles of incorporation and
bylaws and Virginia law.

ANNUAL REPORTS

Stockholders of record on August 31, 2001 should have received a copy
of our 2000 annual report to stockholders with this proxy statement. If, upon
receipt of this proxy material, you have not received the annual report to
stockholders, please write to the Corporate Secretary at the address below and a
copy will be sent to you. Although the annual report is being mailed to
stockholders with this proxy statement, it does not constitute a part of the
proxy solicitation materials and is not incorporated herein by reference.

IN ADDITION, A COPY OF PACEL'S ANNUAL REPORT FILED PURSUANT TO RULE
15D-2 WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 2, 2001 IS AVAILABLE
TO EACH RECORD AND BENEFICIAL OWNER OF PACEL'S COMMON STOCK WITHOUT CHARGE UPON
WRITTEN REQUEST TO THE CORPORATE SECRETARY, PACEL, 8870 RIXLEW LANE, SUITE 201,
MANASSAS, VIRGINIA 20109.

OTHER MATTERS

We are not aware of any business to come before the annual meeting
other than the matters described above in this proxy statement. However, if any
other matters should properly come before the meeting, it is intended that
holders of the proxies will act in accordance with their best judgment.

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REVOCABLE PROXY

PACEL CORP.

ANNUAL MEETING OF STOCKHOLDERS
SEPTEMBER 28, 2001

The undersigned hereby appoints the Board of Directors of PACEL Corp.
(the "Company"), with full powers of substitution, to act as attorneys and
proxies for the undersigned to vote all shares of common stock of the Company
which the undersigned is entitled to vote at the annual meeting of stockholders
(the "Meeting") to be held PACEL Corp. 8870 Rixlew Lane, Suite 201, Manassas,
Virginia, on September 28, 2001 at 10:00 am., local time and at any and all
adjournments and postponements thereof.

I. The election of the following nominees as directors for terms to expire
in the year 2002.

DAVID E. CALKINS F. KAY CALKINS

KEITH P. HICKS COREY M. LACROSS

|_| FOR |_| VOTE WITHHELD |_| FOR ALL EXCEPT

INSTRUCTION: TO WITHHOLD YOUR VOTE FOR THE INDIVIDUAL
NOMINEE, MARK "FOR ALL EXCEPT" WITH AN "X"
AND WRITE THE NOMINEE'S NAME IN THE SPACE
PROVIDED BELOW FOR WHOM YOU WISH TO WITHHOLD
YOUR VOTE.

II. The approval of the amendment to PACEL's Articles of Incorporation
increasing the number of shares of the common stock authorized for
issuance from 150 million to 650 million.

|_| FOR |_| AGAINST |_| ABSTAIN

III. The ratification of the appointment of Peter C. Cosmas Co.CPAs as
auditors of the Company for the fiscal year ending December 31, 2001.

|_| FOR |_| AGAINST |_| ABSTAIN

In their discretion, the proxies are authorized to vote on any other
business that may properly come before the Meeting or any adjournment or
postponement thereof.

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THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS PROXY WILL BE VOTED FOR THE PROPOSAL AND THE NOMINEES LISTED
ABOVE. IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS PROXY WILL BE
VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME,
THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE
MEETING.
--------------------------------------------------------------------------------

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL
AND THE ELECTION OF THE NOMINEES LISTED ABOVE.

(Continued and to be SIGNED on Reverse Side)

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THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

Should the undersigned be present and choose to vote at the Meeting or
at any adjournments or postponements thereof, and after notification to the
Secretary of the Company at the Meeting of the stockholder's decision to
terminate this proxy, then the power of such attorneys or proxies shall be
deemed terminated and of no further force and effect. This proxy may also be
revoked by filing a written notice of revocation with the Secretary of the
Company or by duly executing a proxy bearing a later date.

The undersigned acknowledges receipt from the Company, prior to the
execution of this proxy, of Notice of Annual Meeting of Stockholders, a proxy
statement and an annual report to stockholders.

Dated: , 2001
------------------------

Signature of Stockholder

Please sign exactly as your name(s) appear(s) to the
left. When signing as attorney, executor,
administrator, trustee or guardian, please give your
full title. If shares are held jointly, each holder
should sign.

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PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE
--------------------------------------------------------------------------------

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