<SUBMISSION>
<ACCESSION-NUMBER>0001193125-03-056765
<TYPE>S-3
<PUBLIC-DOCUMENT-COUNT>15
<FILING-DATE>20031001
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>VELOCITY EXPRESS CORP
<CIK>0001002902
<ASSIGNED-SIC>4513
<IRS-NUMBER>870355929
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>0629
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>S-3
<ACT>33
<FILE-NUMBER>333-109362
<FILM-NUMBER>03921028
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>7803 GLENROY ROAD
<STREET2>FOUR PARAMOUNT PLAZA STE 200
<CITY>MINNEAPOLIS
<STATE>MN
<ZIP>55439
<PHONE>612-492-2400
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>7803 GLENROY ROAD
<STREET2>SUITE 200
<CITY>MINNEAPOLIS
<STATE>MN
<ZIP>55439
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>UNITED SHIPPING & TECHNOLOGY INC
<DATE-CHANGED>19990512
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>U SHIP INC
<DATE-CHANGED>19960313
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>S-3
<SEQUENCE>1
<FILENAME>ds3.txt
<DESCRIPTION>FORM S-3
<TEXT>
<PAGE>

    As filed with the Securities and Exchange Commission on October 1, 2003

                                                  Registration No. 333-
================================================================================

                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

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

                                   FORM S-3
                            REGISTRATION STATEMENT
                       Under The Securities Act of 1933

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

                         VELOCITY EXPRESS CORPORATION
            (Exact name of registrant as specified in its charter)

                     Delaware                  87-0355929
                  (State or other            (I.R.S Employer
                  jurisdiction of          Identification No.)
                 incorporation or
                   organization)

                         7803 Glenroy Road, Suite 200
                         Minneapolis, Minnesota 55439
                                (612) 492-2400

  (Address, including zip code, and telephone number, including area code, of
                   registrant's principal executive offices)

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

Wesley Fredenburg          Copy to:                Jonathan B. Abram, Esq.
 General Counsel                                    Dorsey & Whitney LLP
  and Secretary                                     50 South Sixth Street
  7803 Glenroy                                Minneapolis, Minnesota 55402-1498
 Road, Suite 200                                       (612) 343-7962
  Bloomington,
 Minnesota 55439
 (612) 492-2405

(Name, address, including zip code, and telephone number, including area code,
                         of agent for service)

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

   Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
   If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
   If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
   If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
   If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
   If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]

                        CALCULATION OF REGISTRATION FEE

<TABLE>
<S>                    <C>                 <C>            <C>             <C>
======================================================================================
    Title of Each                             Proposed       Proposed
       Class of                               Maximum        Maximum       Amount of
    Securities to            Amount        Offering Price   Aggregate     Registration
    be Registered       to be Registered     per Share    Offering Price      Fee
--------------------------------------------------------------------------------------
Series I
Convertible
Preferred
Stock, $0.004
par value.............  8,409,091 shares       $2.20(1)    $18,500,000(1)    $1,497
--------------------------------------------------------------------------------------
Rights(2).............    8,409,091(3)            --             --            --
--------------------------------------------------------------------------------------
Common Stock,
 $0.004 par
 value,
 issuable upon
 conversion of
 Series I Preferred(4)  84,090,910 shares         --             --            --
--------------------------------------------------------------------------------------
   Total..............                                                       $1,497
======================================================================================
</TABLE>
(1)Estimated solely for purposes of calculating the registration fee in
   accordance with Rule 457(o) under the Securities Act of 1933, as amended.
   The proposed maximum aggregate offering price has been calculated as
   follows: 8,409,091 shares of Series I Preferred are issuable upon exercise
   of 8,409,091 shares of subscription rights at a subscription price of $2.20
   per right.
(2)The rights are being issued without consideration.
(3)Pursuant to Rule 457(g), no separate registration fee is payable with
   respect to the rights being offered hereby since the rights are being
   registered in the same registration statement as the securities to be
   offered pursuant thereto.
(4)Pursuant to Rule 457(i), the additional consideration to be received in
   connection with the exercise of the conversion privilege, if any, shall be
   added to the proposed offering price of the convertible securities.

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

   The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.

================================================================================

<PAGE>

                 SUBJECT TO COMPLETION, DATED OCTOBER 1, 2003
PROSPECTUS

<TABLE>
<C>                                                 <S>
                                                    VELOCITY EXPRESS CORPORATION

                                                              UP TO 8,409,091 SHARES OF
                            [LOGO] Velocity express    SERIES I CONVERTIBLE PREFERRED STOCK
</TABLE>
                               -----------------

   We are distributing at no charge to the holders of our Common Stock, par
value $0.004 per share ("Common Stock"), Series B Convertible Preferred Stock,
par value $0.004 per share ("Series B Preferred"), Series C Convertible
Preferred Stock, par value $0.004 per share ("Series C Preferred"), Series D
Convertible Preferred Stock, par value $0.004 per share ("Series D Preferred"),
Series F Convertible Preferred Stock, par value $0.004 per share ("Series F
Preferred"), Series G Convertible Preferred Stock, par value $0.004 per share
("Series G Preferred"), and Series H Convertible Preferred Stock, par value
$0.004 per share ("Series H Preferred" and, together with Series B Preferred,
Series C Preferred, Series D Preferred, Series F Preferred and Series G
Preferred, the "Preferred Stock") nontransferable subscription rights to
purchase up to an aggregate of 8,409,091 shares of our Series I Convertible
Preferred Stock, $0.004 par value per share (the "Series I Preferred"). With
certain limitations, each share of Series I Preferred is initially convertible
into ten shares of our Common Stock. These subscription rights will be
distributed to our stockholders based on their percentage ownership of our
Common Stock on a fully diluted or as-converted basis on the record date,
September 11, 2003.

   Therefore, holders of Common Stock will receive 0.297952777 right for every
share of Common Stock held on the record date. Holders of Series B Preferred
will receive 0.486231363 rights for each share of Series B Preferred held on
the record date; holders of Series C Preferred will receive 0.329810541 rights
for each share of Series C Preferred held on the record date; holders of Series
D Preferred will receive 0.813565586 rights for each share of Series D
Preferred held on the record date; holders of Series F Preferred will receive
1.745371947 rights for each share of Series F Preferred held on the record
date; holders of Series G Preferred will receive 0.072517623 rights for each
share of Series G Preferred held on the record date; and holders of Series H
Preferred will receive 2.979527767 rights for each share of Series H Preferred
held on the record date. Each right will entitle you to subscribe for one share
of our Series I Preferred at the subscription price of $2.20 per share.

   An investment in our Series I Preferred involves risks. You should consider
carefully the "Risk Factors" beginning on page 6 in this prospectus before
exercising your subscription rights.

   The total purchase price of shares offered in this rights offering will be
approximately $18,500,000. You will not be entitled to receive any subscription
rights unless you are a stockholder of record as of the close of business on
September 11, 2003.

   The subscription rights will expire if they are not exercised by 5:00 p.m.,
New York City time, on       , 2003, the expected expiration time of this
rights offering. NO EXERCISE OF RIGHTS WILL BE ACCEPTED FOLLOWING THE
EXPIRATION TIME. We, in our sole discretion, may terminate the rights offering
for any reason or extend the period for exercising the subscription rights.
Subscription rights that are not exercised by the expiration time of this
rights offering will expire and will have no value. You should carefully
consider whether or not to exercise your subscription rights before the
expiration time. We will not issue fractional shares of Series I Preferred and
we will not pay cash in lieu of fractional shares.

   These securities have not been approved by or disapproved by the Securities
and Exchange Commission or any state securities commission, nor has the
Securities and Exchange Commission or any state securities commission passed
upon the accuracy or adequacy of this prospectus. Any representation to the
contrary is a criminal offense.

   The subscription price for our Series I Preferred may only be paid in cash.
If all of the subscription rights are exercised, the aggregate net proceeds to
us from this rights offering will be approximately $18,390,000, after deducting
organization and other offering expenses payable by us in connection with this
rights offering.

   Our Common Stock is listed on The Nasdaq SmallCap Market under the trading
symbol "VEXP," but no series of our Preferred Stock, including the Series I
Preferred is listed for trading. On September 11, 2003, the closing sale price
of our Common Stock was $0.62.

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

            The date of this prospectus is                  , 2003


The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.

<PAGE>

                               TABLE OF CONTENTS

<TABLE>
 <S>                                                                       <C>
 Prospectus Summary.......................................................  1
 Velocity Express Corporation.............................................  1
 Summary of the Rights Offering...........................................  3
 Risk Factors.............................................................  6
 Special Note Regarding Forward-Looking Statements........................ 11
 Questions and Answers About the Rights Offering.......................... 12
 Summary Selected Historical Consolidated Financial Data.................. 17
 Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends 18
 The Rights Offering...................................................... 19
 Use of Proceeds.......................................................... 28
 Price Range of Common Stock and Dividend Policy.......................... 29
 Capitalization........................................................... 30
 Description of Capital Stock............................................. 31
 Description of Certain Indebtedness...................................... 41
 Plan of Distribution..................................................... 42
 Certain Material U.S. Federal Income Tax Considerations.................. 42
 Legal Matters............................................................ 45
 Experts.................................................................. 45
 Where You Can Find More Information...................................... 45
 Forward-Looking Statements............................................... 46
 Incorporation of Certain Documents by Reference.......................... 47
</TABLE>


                                       i

<PAGE>

                              PROSPECTUS SUMMARY

   The following summary highlights selected information from this prospectus
and may not contain all of the information that is important to you. This
prospectus includes specific terms of the rights offering, as well as
information regarding our business. We encourage you to read this prospectus in
its entirety. You should pay special attention to the "Risk Factors" section of
this prospectus beginning on page 6. All references to "we," "our," "ours,"
"us," and "the Company," or "Velocity Express" in this prospectus are to
Velocity Express Corporation and its subsidiaries, unless otherwise indicated.
However, in the descriptions of the subscription rights and related matters,
these terms refer solely to Velocity Express Corporation and not to any of our
subsidiaries. We also encourage you to review the financial statements and
other information provided in the reports and other documents we file under the
Securities Exchange Act of 1934, as amended, as described in the "Where You Can
Find More Information" section of the prospectus at page 45.

                         VELOCITY EXPRESS CORPORATION

   Velocity Express Corporation, a Delaware corporation, is making the rights
offering. We are engaged in the business of providing same-day transportation
and distribution/logistics services to individual consumers and businesses. We
have one of the largest nationwide networks of customized, time-critical
delivery solutions in the United States and are a leading provider of
scheduled, distribution and expedited logistics services. Our customers are
comprised of multi-location, blue chip customers with operations in the
financial, healthcare, office products, technology, and energy sectors. We
operate primarily in the United States with limited operations in Canada. We
currently operate in a single-business segment.

   Our service offerings are divided into the following categories:

  .  Scheduled logistics consisting of the daily pickup and delivery of parcels
     with narrowly defined time schedules predetermined by the customer.

  .  Distribution logistics consisting of the receipt of customer bulk
     shipments that are divided and sorted at major metropolitan locations and
     delivered into multiple routes with defined end-points and more broadly
     defined time schedules.

  .  Expedited logistics consisting of unique and expedited point-to-point
     service for customers with extremely time sensitive delivery requirements.

   The largest customer base for scheduled logistics consists of financial
institutions that need a wide variety of services, including the pickup and
delivery of non-negotiable instruments, primarily canceled checks and ATM
receipts, the delivery of office supplies, and the transfer of inter-office
mail and correspondence. Distribution logistics typically involve receiving
bulk shipments from the customer and dividing and sorting them for delivery to
specific locations. Customers utilizing distribution logistics normally include
pharmaceutical wholesalers, retailers, manufacturers or other companies that
must distribute merchandise every day from a single point of origin to many
locations within a clearly defined geographic region. Most expedited logistics
services occur within a major metropolitan area or within a radius of 40 miles
of the metropolitan area, and we usually offer one-hour, two- to four-hour and
over four-hour delivery services depending on the customer's time requirements.
These services are typically available 24 hours a day, seven days a week.
Expedited logistics services also include critical parts management and
delivery for companies.

   Our headquarters are located at 7803 Glenroy Road, Suite 200, Bloomington,
Minnesota 55439, and our telephone number is (612) 492-2400. For further
information concerning Velocity Express, please see the section of this
prospectus titled "Where You Can Find More Information."

                                      1

<PAGE>

Recent Developments

   The Company's revolving credit facility with Fleet Capital Corporation
expires in January 2004 and we are negotiating a proposal to replace the
facility. The success of such negotiation will depend on our ability to provide
equity support for the new revolving facility. We intend to use a portion of
the proceeds from this rights offering to provide that support, replacing
certain letters of credit totaling $7.1 million currently maintained by the
Company and guaranteed by one of our major stockholders, TH Lee Putnam
Ventures. However, there is no assurance that we will be successful in
negotiating a replacement facility or that the terms of such a replacement
facility would be acceptable to us. If we are unable to replace our existing
revolving credit facility, our liabilities under that credit facility will be
current liabilities and we have no other financing plans at this time.

   In August of this year the Company retained the Manchester Companies, Inc.
to assist us in the implementation of a financial and operational trade
payables restructuring plan that includes approximately $5 million in accounts
payable. The plan is currently being rolled out to our trade creditors and
offers a number of payment options depending upon the amount owed. To date, we
have received a positive response from 98% of our trade creditors who have
responded to our proposal. We will pay a portion of these restructured payables
from the funds raised by this rights offering. We anticipate initial payments
under this restructuring plan being made in the fall of 2003.

   Finally, in July of this year the Company's President and CEO, Jeff Parell,
resigned to take a position outside the Company. On July 28th the Company's
Board of Directors appointed Vincent Wasik, the Board's Chairman, to the
position of President and CEO.

                                      2

<PAGE>

                        SUMMARY OF THE RIGHTS OFFERING

Securities Offered..........     We are offering to sell up to 8,409,091 shares
                                 of our Series I Preferred upon the exercise of
                                 the subscription rights offered in this
                                 prospectus.

The Rights Offering--Terms
  of Series I Preferred (see
  page 20)..................
                                 The Series I Preferred will rank senior to the
                                 Common Stock with respect to rights on
                                 liquidation, dissolution and winding up.
                                 Generally, we will declare or pay any
                                 dividends on the Series I Preferred when we
                                 declare and pay dividends to the holders of
                                 our Common Stock. Series I Preferred holders
                                 are entitled to notice of all stockholders'
                                 meetings and are entitled to vote on all
                                 matters submitted to the stockholders for a
                                 vote, together with the holders of the Common
                                 Stock and all other classes of capital stock
                                 entitled to vote, voting as a single class.
                                 Each holder of the Series I Preferred is
                                 entitled to one vote for each share of Common
                                 Stock issuable upon conversion of the Series I
                                 Preferred, to the extent that such holder's
                                 voting power, together with the voting power
                                 held by its affiliates, do not exceed 40% of
                                 the total voting power of all of the capital
                                 stock of the Company entitled to vote. A
                                 holder of Series I Preferred may also convert
                                 all or any portion of the Series I Preferred
                                 held into our Common Stock, to the extent that
                                 such holder, together with its affiliates, do
                                 not hold 40% or more of all of the outstanding
                                 capital stock of the Company, on an as
                                 converted basis. The initial conversion ratio
                                 is one share of Series I Preferred into ten
                                 shares of our Common Stock.

                                 Currently, no shares of Series I Preferred are
                                 outstanding. Following the consummation of the
                                 rights offering, assuming all rights are
                                 exercised, 8,409,091 shares of Series I
                                 Preferred will be issued and outstanding.

Subscription Price..........     $2.20 per right.

Record Date.................     September 11, 2003.

Expiration Date and Time (see pageTh2e1)rights expire at 5:00 p.m. New York City
                                 time, on __________, 2003, unless we decide in
                                 our sole discretion to extend the rights
                                 offering until some later time.

Basic Subscription Right
  (see page 21).............
                                 We are distributing at no charge to the
                                 holders of our Common Stock and Preferred
                                 Stock nontransferable subscription rights to
                                 purchase up to an aggregate of 8,409,091
                                 shares of our Series I Preferred. Holders of
                                 Common Stock will receive 0.297952777 right
                                 for every share of Common Stock held on the
                                 record date. Holders of Series B Preferred
                                 will receive 0.486231363 rights for each share
                                 of Series B Preferred held on the record date;
                                 holders of Series C Preferred will receive
                                 0.329810541 rights for each share of Series C
                                 Preferred held on the record date; holders of
                                 Series D Preferred will receive 0.813565586
                                 rights for each share of Series D Preferred
                                 held on the record date; holders of Series F
                                 Preferred

                                      3

<PAGE>

                                 will receive 1.745371947 rights for each share
                                 of Series F Preferred held on the record date;
                                 holders of Series G Preferred will receive
                                 0.072517623 rights for each share of Series G
                                 Preferred held on the record date; and holders
                                 of Series H Preferred will receive 2.979527767
                                 rights for each share of Series H Preferred
                                 held on the record date. Each right will
                                 entitle you to subscribe for one share of our
                                 Series I Preferred at a subscription price of
                                 $2.20 per share. With certain limitations,
                                 each share of Series I Preferred is initially
                                 convertible into ten shares of our Common
                                 Stock.

Oversubscription Right (see
  page 21)..................
                                 Each holder who elects to exercise his or her
                                 basic subscription rights in full may also
                                 oversubscribe for additional shares of Series
                                 I Preferred. We cannot assure you that any
                                 additional shares of Series I Preferred will
                                 be available for purchase. Any amounts
                                 tendered by you and not used to purchase
                                 additional shares of Series I Preferred will
                                 be refunded to you, without interest.

                                 If there are not sufficient shares of Series I
                                 Preferred to fully satisfy all of the
                                 oversubscription requests, the number of
                                 shares available will be allocated on a pro
                                 rata basis based upon the oversubscription
                                 price tendered by each person seeking to
                                 oversubscribe as of the expiration date of the
                                 offering.

Cancellation Rights (see
  page 14)..................     We may cancel the offering at any time in our
                                 discretion, in which case we will return your
                                 subscription payment, without interest.

Nontransferability of Rights
  (see page 21).............
                                 The subscription rights will be evidenced by
                                 nontransferable subscription rights
                                 certificates. The subscription rights are not
                                 transferable.

Subscription Procedures (see
  page 24)..................     You may exercise your basic subscription
                                 rights and, if you elect, your
                                 oversubscription rights, by properly
                                 completing and delivering the subscription
                                 certificate which accompanies this prospectus
                                 to American Stock Transfer & Trust Company,
                                 our subscription agent, with full payment for
                                 the subscription rights.

                                 You may deliver the documents and payments by
                                 mail or commercial courier. If regular mail is
                                 used for this purpose, we recommend using
                                 insured, registered mail. You may use an
                                 alternative form, the "Notice of Guaranteed
                                 Delivery," if you are unable to deliver the
                                 subscription certificate before the expiration
                                 time, subject to the requirements of the
                                 procedure described under "The Rights
                                 Offering--Guaranteed Delivery Procedures" on
                                 page 27. Your payment may be made by a
                                 personal check, bank certified check,
                                 cashier's check or wire transfer.

                                 Once you submit the form of subscription
                                 certificate to exercise any rights, you can
                                 not revoke or change the exercise or request a
                                 refund of any monies paid.

                                      4

<PAGE>

How Rights Holder can
  Exercise Subscription
  Rights Through Others (see
  page 26)..................     If you hold shares of our Common Stock as of
                                 the record date through a broker, custodian
                                 bank or other nominee, we will ask your
                                 broker, custodian bank or other nominee to
                                 notify you of this rights offering. If you
                                 wish to exercise your subscription rights, you
                                 will need to have your broker, custodian bank
                                 or other nominee act for you. To indicate your
                                 decision, you should complete and return to
                                 your broker, custodian bank or other nominee
                                 the form entitled "Beneficial Owner Election
                                 Form." You should receive this form from your
                                 broker, custodian bank or other nominee with
                                 the other subscription rights offering
                                 materials. You should contact your broker,
                                 custodian bank or other nominee if you do not
                                 receive this form, but believe you are
                                 entitled to participate in this rights
                                 offering.

U.S. Federal Income Tax
  Considerations (see page
  42).......................
                                 Our position for U.S. federal income tax
                                 purposes is that (i) holders of our Common
                                 Stock should not recognize taxable income upon
                                 the receipt of the subscription rights and
                                 (ii) holders of our Preferred Stock should not
                                 recognize any current taxable income upon the
                                 receipt of subscription rights because we do
                                 not have or expect to have any current or
                                 accumulated earnings and profits, as computed
                                 for federal income tax purposes, this year.
                                 See "Certain Material U.S. Federal Income Tax
                                 Considerations," beginning on page 42.

No Recommendation to Rights
  Holders (see page 14).....     We are not making any recommendations as to
                                 whether or not you should subscribe for shares
                                 of our Series I Preferred. You should decide
                                 whether to subscribe for such shares based
                                 upon your own assessment of your best
                                 interests and after considering all of the
                                 information in this prospectus, including the
                                 "Risk Factors" section of this prospectus and
                                 all of the information incorporated by
                                 reference in this prospectus.

Questions...................     If you have any questions about the rights
                                 offering, including questions about
                                 subscription procedures and requests for
                                 additional copies of this prospectus or other
                                 documents, please contact our General Counsel
                                 and Secretary, Wesley Fredenburg, at (612)
                                 492-2405.

Risk Factors (see page 6)...     An investment in our Series I Preferred
                                 involves risks. You should carefully review
                                 the "Risk Factors" section of this prospectus
                                 beginning on page 6.

Use of proceeds (see page 28)    The net proceeds of the offering will be used
                                 by us as support for a new revolving credit
                                 facility and for general corporate purposes.
                                 We are currently negotiating the terms of the
                                 new revolving credit facility.

   For additional information concerning the subscription rights and our Series
I Preferred, see "The Rights Offering" beginning on page 19.

                                      5

<PAGE>

                                 RISK FACTORS

   An investment in our Series I Preferred involves risks. You should carefully
consider the following risk factors, and all other information contained and
incorporated by reference in this prospectus before you decide to purchase
shares of our common stock. The risks described below are not the only risks we
face. Additional risks that we do not yet know of or that we currently think
are immaterial may also impair our business operations. Any of the events or
circumstances described in the following risks could have a material adverse
impact on our business, financial condition and results of operations if they
were to actually occur. If that happens, the trading price of our common stock
could decline, and you may lose all or part of your investment.

Risks Related To Our Business

   We have sustained losses applicable to holders of our Common Stock in the
past and we may continue to sustain losses applicable to holders of our Common
Stock in the future.

   We experienced net losses applicable to holders of our Common Stock of
approximately $35.0 million for the fiscal year ended June 30, 2001,
approximately $20.4 million for the fiscal year ended June 29, 2002 and $2.5
million for the nine months ended March 29, 2003. The nature and extent of any
future losses applicable to holders of our Common Stock will depend on the
success of our financial and business strategies, and on other factors, some of
which may be beyond our control. We cannot assure you that we will eliminate
net losses applicable to holders of our Common Stock and achieve profitable
operations.

   We may not be successful in implementing our growth plans.

   We face the risks, expenses and uncertainties frequently encountered by
emerging companies that operate in evolving markets. Successfully achieving our
growth plan depends upon, among other things, our ability to:

  .  continue to reduce losses and position ourselves to continue positive cash
     flow;

  .  successfully promote our national brand;

  .  deliver services that are equal or superior to those of our competitors;
     and

  .  obtain and maintain a technological competitive advantage.

   We may need additional capital to finance our growth and working capital
needs.

   We have sustained net losses in each of the past three years and may
continue to do so in the future. If we continue to experience operating losses,
we will need additional cash to offset these losses, which may not be available
to us on acceptable terms, or at all. Achieving our financial goals involves
implementing a number of strategies, some of which may not develop when or as
planned. To date, we have primarily relied upon debt and equity investments to
fund our operations and growth.

   We have substantial indebtedness.

   On January 28, 2002, we entered into a new $40 million revolving credit
facility with a group of banks led by Fleet Capital Corporation and repaid all
amounts outstanding under our old credit facility with a group of banks led by
General Electric Capital Corporation. As of March 29, 2003, $33.7 million was
outstanding under the new revolving credit facility and we had an additional $5
million in subordinated indebtedness. On September 24, 1999, we entered into a
Note and Warrant Purchase Agreement with Bayview Capital Partners L.P.
("Bayview"), under which the Company borrowed from Bayview $5,000,000 at a per
annum interest rate of 12%, due quarterly. On September 8, 2003, the Company
also borrowed $1,000,000 from an individual investor with an agreement to repay
the principal and a lump sum interest payment of $25,000 within 90 days.
Substantially all of our assets are pledged to secure our indebtedness. Subject
to the restrictions in our existing credit agreements, we and our subsidiaries
may incur additional indebtedness from time to time to increase working
capital, finance capital expenditures, and for other general corporate purposes.

                                      6

<PAGE>

   Our revolving credit facility matures on January 28, 2004.

   Our ability to refinance the revolving credit facility upon maturity will
depend to a great degree on our operating performance at the time of maturity.
If we cannot successfully refinance the revolving credit facility upon
maturity, we will be required to raise capital through the issuance of
additional debt or equity securities or sales of some or all of our assets in
order to meet our repayment obligations under the facility. We cannot assure
you that we will be able to raise such capital or that the terms for raising
such capital would be acceptable to us.

   Our debt instruments contain significant financial and operational
requirements.

   Our revolving credit agreement contains a number of financial covenants
that, among other things, require us to maintain specified interest coverage
ratios and specified levels of availability under the revolving credit facility
based upon our interest coverage ratio. The credit agreement also restricts our
ability to dispose of assets, incur additional indebtedness, amend our debt
instruments, make payments on subordinated debt, pay dividends or other
distributions, create liens on assets, make capital expenditures, enter into
sale and leaseback transactions, allow our subsidiaries to issue securities or
make any sales on a repurchase or return basis, make investments, loans or
advances, engage in mergers, consolidations, joint ventures, acquisitions or
structural changes, change our organizational documents or our fiscal year end,
enter into leases or negative pledges, and engage in transactions with
affiliates.

   Our ability to comply with the financial covenants in our credit agreements
will be affected by our financial performance as well as events beyond our
control, including prevailing economic, financial and industry conditions.

   The breach of any of the covenants in our credit agreements could result in
a default, which would permit the lenders to declare all amounts borrowed
thereunder to be due and payable, together with accrued and unpaid interest. If
we are unable to repay our indebtedness, the lenders could proceed against the
collateral securing the indebtedness.

   Rapid technological changes in communications technology may require
substantial expenditures by us.

   The industry in which we compete is characterized by rapidly changing
technology, evolving industry standards, frequent new service announcements,
introductions and enhancements, compromises in security and changing customer
demands. Accordingly, our future success may depend on our ability to respond
to rapidly changing technologies, to adapt our services to evolving industry
standards and to continually improve the performance, features and reliability
of our technology and services in response to competitive service offerings and
the evolving demands of the marketplace. Obtaining and maintaining a
technological competitive advantage may require us to make substantial
expenditures, which could have a material adverse effect on our business,
results of operations and financial condition.

   We face significant risks of tax authorities classifying independent
contractors as our employees.

   A significant number of our drivers are currently independent contractors
(meaning that they are not our employees). From time to time, federal and state
taxing authorities have sought to assert that independent contractor drivers in
the same-day delivery and transportation industries are employees. We do not
pay or withhold federal or state employment taxes with respect to drivers who
are independent contractors. Although we believe that the independent
contractors we utilize are not our employees under existing interpretations of
federal and state laws, we cannot guarantee you that federal and state
authorities will not challenge our position or that other laws or regulations,
including tax laws and laws relating to employment and worker compensation,
will not change. If the IRS were to successfully assert that our independent
contractors are in fact our employees, we would be required to pay withholding
taxes and extend additional employee benefits to these persons. In addition, we
could become responsible for past and future employment taxes. If we are
required to pay withholding taxes with respect to amounts previously paid to
these persons, we could be required to pay penalties

                                      7

<PAGE>

or be subject to other liabilities as a result of incorrectly classifying
employees. If our drivers are deemed to be employees rather than independent
contractors, we could be required to increase their compensation since they may
no longer be receiving commission-based compensation. Any of the foregoing
possibilities could increase our operating costs and have a material adverse
effect on our business, financial condition and results of operations.

   We could be subject to claims for personal injury, death and property damage.

   We could be exposed to claims for personal injury, death and property damage
as a result of accidents involving our employees and independent contractors.
While we carry liability insurance and require that our independent contractors
maintain at least the minimum amount of liability insurance required by state
law, we cannot assure you that any claims made against us will not exceed the
amount of our insurance coverage. Successful claims for personal injury, death
or property damage in excess of our insurance coverage could have a material
adverse effect on our business, financial condition and results of operations.

   We could be subject to claims for non-delivery or delayed delivery of
packages.

   We could be subject to claims resulting from non-delivery or delayed
delivery of packages, many of which could be significant because of unique or
time sensitive deliveries. While our customer contracts contain limitations of
our liability for non-delivery or delayed delivery of packages, we cannot
assure you that we will be able to successfully limit our liability for package
deliveries by contract. Successful claims for non-delivery or delayed delivery
of packages could have a material adverse effect on our business, financial
condition and results of operations.

   We face many risks unique to the package shipping and same-day delivery
industries.

   Numerous events and factors that affect the delivery services industry could
also affect (and recently have affected) our business, financial condition and
results of operations, including:

  .  weather conditions;

  .  fuel prices and shortages;

  .  economic factors affecting customers, as well as general economic
     conditions affecting prices and operating margins;

  .  the ability of United States companies to maintain continuous operation of
     supply and communications systems;

  .  downturns in the level of general economic activity or employment in the
     United States, which could affect the demand for package and priority
     document delivery; and

  .  labor shortages and disputes.

   We must comply with various governmental regulations.

   Various local, state and federal regulations require us to obtain and
maintain permits and licenses in connection with our operations. Some of our
operations may also involve the delivery of items subject to more stringent
regulation, including hazardous materials, which would require us to obtain
additional permits. In addition, we cannot assure you that existing laws or
regulations will not be revised or that new laws or regulations, which could
have an adverse impact on our operations, will not be adopted or become
applicable to us. Our failure to maintain required permits and licenses, or to
comply with applicable regulations, could result in substantial fines or
revocation of permits and licenses, any of which could have a material adverse
effect on our business, financial condition and results of operations.

   We face intense competition in the market for same-day delivery services.

   We expect that competition will continue to intensify in the same day
delivery business. Companies such as UPS(R), Federal Express(R), and DHL(R)
dominate the next day commercial package shipping market. The market for

                                      8

<PAGE>

point-to-point delivery services is also highly competitive, with a number of
companies having multi-state and multi-city operations. A number of these
competitors have greater financial and technical resources and more industry
recognition than we do. Any of these companies could elect to enter the
same-day delivery market in direct competition with us. Increased competitive
pressure could have a material adverse effect on our business, financial
condition and results of operations.

   We depend on our key personnel.

   We depend upon the continued services of our senior management for our
success. The loss of a member of our senior management could have a material
adverse effect on our business, financial condition and results of operations.
We cannot assure you that we will be able to retain our senior management or
our other key personnel.

   The loss of significant customers could adversely affect our business.

   Our contracts with our commercial customers typically have a term of 1 to 3
years, but are terminable upon 30 or 60 days notice. Although we have no reason
to believe that these contracts will be terminated prior to the expiration of
their terms, early termination of these contracts could have a material adverse
effect on our business, financial condition and results of operations.

   Our stock may be delisted from Nasdaq because we may not meet the minimum
bid price and market capitalization requirements for continued listing.

   In the past, we have been notified by Nasdaq that our stock was subject to
delisting because our common stock has failed to maintain a minimum bid price
of $1.00 over the previous 30 consecutive trading days and that we were not in
compliance of the market capitalization requirement of $35,000,000 as required
by The Nasdaq SmallCap Market under its Marketplace Rules. We are currently
operating under a delisting notice relative to the minimum bid price
requirements and have been given until January 16, 2004 to regain compliance.
In the event that we are unable to maintain the standards for continued
listing, our shares would be subject to delisting from The Nasdaq SmallCap
Market.

   We have a substantial investment in equipment and technology.

   As a part of our business strategy, we have invested significantly in
equipment and technology, and we will continue to make investments that we
believe are necessary or appropriate to maintain our presence in the same-day
delivery industry. While we believe that these investments will give us an
advantage over our competitors, we cannot assure you that this strategy will be
successful or that we will be able to recover our investment through increased
revenues or profits. Additionally, disruptions in electrical and other energy
supplies could cause a disruption of, or damage to, our technology and
communication systems.

   Terrorist attacks and threats or actual war may negatively impact all
aspects of our operations.

   Recent terrorist attacks in the United States, as well as future events
occurring in response to them, including, without limitation, future terrorist
attacks against U.S. targets, rumors or threats of war, actual conflicts
involving the United States or its allies or military or trade disruptions
impacting our domestic or foreign customers have had and could continue to
have, a significant impact on our business. These effects have included, and
may continue to include, reduced demand for our services and delays in our
ability to deliver services to our customers. More generally, any of these
events could cause consumer confidence and spending to decrease or result in
increased volatility in the U.S. and worldwide financial markets and economy.
They could also result in economic recession in the U.S. or abroad. Any of
these occurrences could have a material adverse effect on our business,
financial condition and results of operations.

                                      9

<PAGE>

Risks Related To The Rights Offering

   The subscription price determined for this rights offering is not an
indication of our value.

   The subscription price per share for the rights offering was set by our
board of directors. The board of directors determined the price of the offering
based on our expected ability to attract capital investment at that offering
price. The board of directors also took into account the dilutive effect of
this rights offering to our other outstanding capital securities, the sale
price of, and the ability to attract investors to, the Company's most recent
private placement and an analysis of the cost and availability to raise funds
through other debt or equity methods. In making its decision, the board of
directors did not retain outside consultants or investment bankers. The
subscription price does not necessarily bear any relationship to the book value
of our assets, past operations, cash flows, losses, financial condition or any
other established criteria for value. You should not consider the subscription
price as an indication of the value of our Series I Preferred. After the date
of this prospectus, our Common Stock may trade at prices above or below 10% of
the subscription price.

   Our position regarding the U.S. federal income tax consequences of the
receipt of the subscription rights may not be sustained by the Internal Revenue
Service.

   Our position for U.S. federal income tax purposes is that (i) holders of our
Common Stock should not recognize taxable income upon the receipt of the
subscription rights and (ii) holders of our Preferred Stock should not
recognize any current taxable income upon the receipt of the subscription
rights because we do not have or expect to have any current or accumulated
earnings and profits, as computed for federal income tax purposes, this year.
However, there is no assurance that the Internal Revenue Service will agree
with our position. See "Certain Material U.S. Federal Income Tax
Considerations," beginning on page 42.

   The use of our net operating losses could be limited if we undergo an
ownership change upon exercise of the subscription rights.

   If the exercise of the subscription rights causes us to undergo an
"ownership change" for federal income tax purposes (i.e., an increase by more
than 50% of the amount of stock held by one or more of our 5% shareholders
during the past 3 years), our use of our pre-change net operating losses will
generally be limited annually to the product of the long-term tax-exempt rate
(currently 4.74%) and the value of our stock immediately before the ownership
change. This could increase our federal income tax liability if we generate
taxable income in the future.

   You may not revoke your subscription right exercise and could be committed
to buying shares above the prevailing market value of our Common Stock into
which the Series I Preferred is convertible.

   Once you exercise your subscription rights, you may not revoke the exercise
and cancel the purchase of the shares in the rights offering. The public
trading market price of our Common Stock may decline before the subscription
rights expire. If you exercise your subscription rights and, afterwards, the
public trading market price of our Common Stock decreases below the
subscription price, you will have committed to buying shares of our Series I
Preferred at a price above the prevailing market value of our Common Stock into
which the Series I Preferred is convertible. Moreover, you may be unable to
sell your shares of Series I Preferred at a price equal to or greater than the
subscription price you paid for such shares.

   The Series I Preferred is not listed on any trading market.

   The Series I Preferred will not be listed on a national securities exchange
in the United States. No party intends to make a market in the Series I
Preferred. As a result, no assurance can be given that any trading market for
our Series I Preferred will develop or, if developed, how liquid that trading
market for the Series I Preferred would be.

                                      10

<PAGE>

   If we cancel this rights offering, we will not have any obligation to you
except to return your subscription payments.

   If we elect to withdraw or terminate this rights offering, we do not have
any obligation with respect to the subscription rights except to return,
without interest or deduction, any subscription payments we received from you.

   If you do not act promptly and follow subscription instructions, your
exercise of subscription rights may be rejected.

   Stockholders who desire to purchase shares in this rights offering must act
promptly to ensure that all required forms and payments are actually received
by the subscription agent prior to 5:00 p.m. New York City time on           ,
2003, the expiration time of this rights offering. If you are a beneficial
owner of shares, you must act promptly to ensure that your broker, custodian
bank or other nominee acts for you and that all required forms and payments are
actually received by the subscription agent prior to           , 2003. We shall
not be responsible if your broker, custodian or nominee fails to ensure that
all required forms and payments are actually received by the subscription agent
prior to 5:00 p.m. on           , 2003, the expiration time of this rights
offering. If you fail to complete and sign the required subscription forms,
send an incorrect payment amount, or otherwise fail to follow the subscription
procedures that apply to your exercise in this rights offering, we may,
depending on the circumstances, reject your subscription or accept it only to
the extent of the payment received. We do not undertake to contact you
concerning an incomplete or incorrect subscription form or payment, nor are we
under any obligation to correct such forms or payment. We have the sole
discretion to determine whether a subscription exercise properly follows the
subscription procedures.

   If you make payment of the subscription price by personal check, your check
may not have cleared in sufficient time to enable you to purchase shares in
this rights offering.

   Any personal check used to pay for shares to be issued in this rights
offering must clear prior to the expiration time of this rights offering, and
the clearing process may require five or more business days. If you choose to
exercise your subscription rights, in whole or in part, and to pay for shares
by personal check and your check has not cleared prior to the expiration time
of this rights offering, you will not have satisfied the conditions to exercise
your subscription rights and will not receive the shares you attempted to
purchase and you will lose the value of your subscription rights.

               SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

   This prospectus and the documents we incorporate by reference contain
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements are those statements that are not based upon
historical fact, which can be identified by the use of terminology such as
"may," "will," "should," "expects," "plans," "anticipates," "believes,"
"estimates," "predicts," "potential," or "continue" or the negative of such
terms or other comparable terminology. These forward-looking statements
include, among others, statements concerning our general business strategies,
financing decisions, and expectations for funding capital expenditures and
operations in the future. Additionally, such statements are based, in part, on
assumptions made by, and information currently available to, management,
including management's own knowledge and assessment of Velocity Express, the
industry and our competition. Such statements are subject to known and unknown
risks and uncertainties, and other factors, that may cause our actual results
to be materially different from those expressed or implied by such
forward-looking statements. Some of the factors that could cause or contribute
to such differences include those discussed in this prospectus under the
caption "Risk Factors."

                                      11

<PAGE>

                QUESTIONS AND ANSWERS ABOUT THE RIGHTS OFFERING

What is this Rights Offering?

   This rights offering is a distribution, at no charge, to holders of our
Common Stock and Preferred Stock, of approximately 8,409,091 nontransferable
subscription rights to purchase shares of our Series I Preferred. These
subscription rights will be distributed to our stockholders based on their
percentage ownership of our Common Stock on a fully diluted or as-converted
basis on the record date. The board of directors has fixed the close of
business on September 11, 2003, as the record date for the determination of
stockholders entitled to the subscription rights. As of September 11, 2003, the
following securities of the Company were outstanding: 5,443,993 shares of
Common Stock; 2,806,797 shares of Series B Preferred; 2,000,000 shares of
Series C Preferred; 1,517,444 shares of Series D Preferred; 924,170 shares of
Series F Preferred; 5,865,331 shares of Series G Preferred and 500,000 shares
of Series H Preferred. The following table details the total amount of Common
Stock outstanding assuming conversion of all of our Preferred Stock into our
Common Stock and the number of subscription rights holders of each of those
securities are entitled to.

<TABLE>
<CAPTION>
                           Number of       Number of         Number of
                        Shares of Class Common Stock if Subscription Rights
     Class Outstanding    Outstanding   Fully Converted Per Original Share
     -----------------  --------------- --------------- -------------------
     <S>                <C>             <C>             <C>
     Common Stock......    5,443,993       5,443,993        0.297952777
     Series B Preferred    2,806,797       4,580,433        0.486231363
     Series C Preferred    2,000,000       2,213,844        0.329810541
     Series D Preferred    1,517,444       4,143,409        0.813565586
     Series F Preferred      924,170       5,413,678        1.745371947
     Series G Preferred    5,865,331       1,427,541        0.072517623
     Series H Preferred      500,000       5,000,000        2.979527767
</TABLE>

   Each subscription right shall allow the holder to subscribe for and purchase
one share of our Series I Preferred Stock. The maximum gross proceeds of this
rights offering, assuming all the rights are exercised at the subscription
price of $2.20, will be $18,500,000.

Will Velocity Express be Issuing Fractional Shares?

   No. We will not be issuing fractional shares of the Series I Preferred. We
will only accept exercises of whole shares of subscription rights. We will also
not pay cash in lieu of any fractional shares.

What are the Terms of the Series I Preferred?

   The Series I Preferred will rank senior to the Common Stock with respect to
rights on liquidation, dissolution and winding up. We will declare or pay any
dividends on the Series I Preferred when we declare and pay dividends to the
holders of our Common Stock (whether payable in cash, securities or other
property) other than dividends payable solely in shares of Common Stock. These
dividends shall be equal to the dividend that would have been declared and paid
with respect to the Common Stock issuable upon conversion of the Series I
Preferred, assuming all shares of the Series I Preferred held had been
converted immediately prior to the record date for the dividend. Series I
Preferred holders are entitled to notice of all stockholders' meetings and are
entitled to vote on all matters submitted to the stockholders for a vote,
together with the holders of the Common Stock and all other classes of capital
stock entitled to vote, voting as a single class. Each holder of the Series I
Preferred is entitled to one vote for each share of Common Stock issuable upon
conversion of the Series I Preferred, to the extent that such holder's voting
power, together with the voting power held by its affiliates, do not exceed 40%
of the voting power of all of the capital stock of the Company entitled to
vote. A holder of Series I Preferred may also convert all or any portion of the
Series I Preferred held into shares of our Common Stock, to the extent that
such holder, together with its affiliates, do not hold 40% or more of all of
the outstanding capital stock of the Company, on an as converted basis. The
initial conversion ratio is one share of Series I Preferred into ten shares of
our Common Stock.

                                      12

<PAGE>

What is a Subscription Right?

   The subscription rights are rights to purchase shares of our Series I
Preferred. Each subscription right carries with it a basic subscription right
and an over-subscription right.

How Many Shares May I Purchase if I Exercise My Subscription Rights?

   The number of shares of Series I Preferred you can purchase will depend on
the number of subscription rights you receive. Holders of one share of our
Common Stock on the record date will receive 0.297952777 rights. Holders of one
share of our Series B Preferred on the record date will receive 0.486231363
rights. Holders of one share of our Series C Preferred on the record date will
receive 0.329810541 rights. Holders of one share of our Series D Preferred on
the record date will receive 0.813565586 rights. Holders of one share of our
Series F Preferred on the record date will receive 1.745371947 rights. Holders
of one share of our Series G Preferred on the record date will receive
0.072517623 rights. Holders of one share of our Series H Preferred on the
record date will receive 2.979527767 rights. Each subscription right contains
the basic subscription right and the over-subscription right.

What is the Basic Subscription Right?

   The basic subscription right of each subscription right entitles you to
purchase one share of our Series I Preferred at the subscription price of $2.20
per share. With certain limitations, each share of Series I Preferred is
initially convertible into ten shares of our Common Stock.

What is the Over-Subscription Right?

   The over-subscription right associated with each subscription right entitles
you, if you fully exercise your basic subscription right, to subscribe for
additional shares of our Series I Preferred at the same subscription price per
share, on a pro rata basis, if any shares are not purchased by other holders of
subscription rights under their basic subscription rights as of the expiration
date. "Pro rata" means in proportion to the amount of over-subscription price
tendered by each person seeking to oversubscribe as of the expiration date of
the offering.

What if there is an Insufficient Number of Shares to Satisfy the
Over-Subscription Requests?

   If there is an insufficient number of shares of our Series I Preferred
available to fully satisfy the over-subscription requests of rights holders,
subscription rights holders who exercised their over-subscription right will
receive the available shares pro rata based on the amount of over-subscription
price tendered by each person seeking to oversubscribe as of the expiration
date of the offering. Any excess subscription payments will be returned,
without interest or deduction, promptly after the expiration of this rights
offering.

Why are You Engaging in this Rights Offering?

   The net proceeds of the offering will be used by us as support for a new
revolving credit facility and for general corporate purposes. We are currently
negotiating the terms of the new revolving credit facility.

What Happens if I Choose Not to Exercise My Subscription Rights?

   You will retain your current number of shares of Common Stock or Preferred
Stock even if you do not exercise your subscription rights. However, if other
stockholders exercise their subscription rights, your percentage ownership of
Velocity Express on a fully diluted basis will decrease.

What is the Dilutive Effect of this Rights Offering on the Company?

   The net tangible book value per share for each of our Common Stock on a
fully diluted and as-converted basis before and after the offering is as
follows:

<TABLE>
<CAPTION>
                              Net Tangible Book Value  Net Tangible Book Value
     Class of Security       Per Share Before Offering Per Share After Offering
     -----------------       ------------------------- ------------------------
<S>                          <C>                       <C>
Common Stock (fully-diluted)          $(0.26)                   $0.06
</TABLE>

                                      13

<PAGE>

   The net tangible book value per share increased by $0.32 due to the cash
payments made by purchasers of the Series I Preferred.

Can Your Board of Directors Cancel this Rights Offering?

   Yes. Our board of directors may decide to cancel this rights offering at any
time prior to the expiration of the rights offering and for any reason. If we
cancel this rights offering, any money received from subscribing stockholders
will be refunded promptly, without interest or deduction.

When will this Rights Offering Expire?

   The subscription rights will expire, if not exercised, at 5:00 p.m., New
York City time, on           , 2003, unless we decide to extend this rights
offering until some later time. See "The Rights Offering--Expiration of the
Rights Offering and Extensions and Termination." The subscription agent must
actually receive all required documents and payments before that time and date
for the exercise of your subscription right to be valid. There is no maximum
duration for this rights offering.

How do I Exercise My Subscription Rights?

   You may exercise your subscription rights by properly completing and signing
your subscription rights certificate. Your subscription rights certificate,
together with full payment of the subscription price, must be received by the
subscription agent on or prior to the expiration time of this rights offering.
If you use the mail, we recommend that you use insured, registered mail, return
receipt requested. If you cannot deliver your subscription rights certificate
to the subscription agent on time, you may follow the guaranteed delivery
procedures described under "The Rights Offering--Guaranteed Delivery
Procedures."

May I Transfer or Sell My Subscription Rights if I Do Not Want to Purchase any
Shares?

   No. The subscription rights will be evidenced by nontransferable
subscription rights certificates. The subscription rights are not transferable.

What Should I Do If I Want to Participate in this Rights Offering But My Shares
are Held in the Name of My Broker, Custodian Bank or Other Nominee?

   If you hold shares of our Common Stock through a broker, custodian bank or
other nominee, we will ask your broker, custodian bank or other nominee to
notify you of this rights offering. If you wish to exercise your subscription
rights, you will need to have your broker, custodian bank or other nominee act
for you. To indicate your decision, you should complete and return to your
broker, custodian bank or other nominee the form entitled "Beneficial Owner
Election Form." You should receive this form from your broker, custodian bank
or other nominee with the other rights offering materials. You should contact
your broker, custodian bank or other nominee if you do not receive this form,
but believe that you are entitled to participate in this rights offering.

Will I be Charged a Sales Commission or a Fee if I Exercise My Subscription
Rights?

   We will not charge a brokerage commission or a fee to subscription rights
holders for exercising their subscription rights. However, if you exercise your
subscription rights through a broker, custodian bank or nominee, you will be
responsible for any fees charged by your broker, custodian bank or nominee.

What is the Recommendation of the Board of Directors Regarding this Rights
Offering?

   Neither we nor our board of directors are making any recommendation as to
whether or not you should exercise your subscription rights. You are urged to
make your decision based on your own assessment of this rights offering and
after considering all of the information in this prospectus, including the
"Risk Factors" section of this prospectus and all of the information
incorporated by reference into this prospectus.

                                      14

<PAGE>

How was the $2.20 Per Share Subscription Price Established?

   The board of directors determined the price of the offering based on our
expected ability to attract capital investment at that offering price. The
board of directors also took into account the dilutive effect of this rights
offering to our other outstanding capital securities, the sale price of, and
the ability to attract investors to, the Company's most recent private
placement and an analysis of the cost and availability to raise funds through
other debt or equity methods in using this method. In making its decision, the
board of directors did not retain outside consultants or investment bankers.

Is Exercising My Subscription Rights Risky?

   The exercise of your subscription rights involves risks. Exercising your
subscription rights represents a purchase of shares of our Series I Preferred
and should be considered as carefully as you would consider any other equity
investment. You should carefully consider the information under the heading
"Risk Factors" and all other information included or incorporated by reference
in this prospectus before deciding to exercise your subscription rights.

Am I Required to Subscribe in this Rights Offering?

   No.

After I Exercise My Subscription Rights, Can I Change My Mind and Cancel My
Purchase?

   No. Once you send in your subscription rights certificate and payment, you
cannot revoke the exercise of your subscription rights, even if the aggregate
market price of ten shares of our Common Stock, into which each share of our
Series I Preferred is initially convertible, is below the $2.20 per share
subscription price. You should not exercise your subscription rights unless you
are certain that you wish to purchase shares of our Series I Preferred at a
price of $2.20 per share. Subscription rights not exercised prior to the
expiration of this rights offering will have no value.

What are the Federal Income Tax Consequences of Exercising My Subscription
Rights?

   Our position for U.S. federal income tax purposes is that (i) holders of our
Common Stock should not recognize taxable income upon the receipt of the
subscription rights and (ii) holders of our Preferred Stock should not
recognize any current taxable income upon the receipt of subscription rights
because we do not have or expect to have any current or accumulated earnings
and profits, as computed for federal income tax purposes, this year. See
"Certain Material U.S. Federal Income Tax Considerations," beginning on page 42.

If this Rights Offering is not Completed, Will My Subscription Payment be
Refunded to Me?

   Yes. We will hold all funds we receive in escrow until completion of this
rights offering. If this rights offering is not completed, we will return
promptly, without interest or deduction, all subscription payments.

How Many Shares of Common Stock and Preferred Stock Will be Outstanding After
This Rights Offering?

   The number of shares of Common Stock and Preferred Stock that will be
outstanding immediately after the completion of this rights offering, assuming
all rights are exercised, will be 5,443,993 shares of Common Stock, 2,806,797
shares of Series B Preferred convertible into 8,665,044 shares of Common Stock,
2,000,000 shares of Series C Preferred convertible into 4,251,642 shares of
Common Stock, 1,517,444 shares of Series D Preferred convertible into 7,949,991
shares of Common Stock, 924,170 shares of Series F Preferred convertible into
9,998,836 shares of Common Stock, 5,865,331 shares of Series G Preferred
convertible into 2,636,647 shares of Common Stock, 500,000 shares of Series H
Preferred convertible into 9,235,299 shares of Common Stock, and 8,409,091
shares of Series I Preferred convertible into 84,090,910 shares of Common Stock.

                                      15

<PAGE>

If I Exercise My Subscription Rights, When will I Receive Shares of Series I
Preferred Purchased in this Rights Offering?

   The subscription agent will deliver to the record holders who purchase
shares in this rights offering certificates representing the shares of our
Series I Preferred purchased as soon as practicable after the expiration date
of this rights offering and after all pro rata allocations and adjustments have
been completed. The subscription agent will not be able to begin calculation of
the number of shares to be issued to each exercising holder until 5:00 p.m.,
New York City time, on the third business day after the expiration date of this
rights offering, which is the latest time by which subscription rights
certificates may be delivered to us under the guaranteed delivery procedures
described under "The Rights Offering--Guaranteed Delivery Procedures."

What Should I do if I have Other Questions?

   If you have questions or need assistance, please contact our General Counsel
and Secretary, Wesley Fredenburg, at (612) 492-2405. For a more complete
description of this rights offering, see "The Rights Offering" section and the
"Plan of Distribution" section included elsewhere in this prospectus.

                                      16

<PAGE>

            SUMMARY SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA

   The following table sets forth summary consolidated financial data of
Velocity Express as of and for each of the periods indicated. Velocity Express
derived the consolidated financial data as of and for the nine months ended
March 29, 2003 from Velocity Express' unaudited consolidated financial
statements. Velocity Express derived the consolidated financial data as of and
for each of the annual periods presented from Velocity Express' audited
consolidated financial statements. This information is only a summary and you
should read it in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the historical consolidated
financial statements, and the related schedules and notes, contained in
Velocity Express' Annual Report on Form 10-K, which is incorporated by
reference herein and Quarterly Reports on Form 10-Q and other information that
Velocity Express has filed with the Securities and Exchange Commission. See
"Incorporation of Certain Documents by Reference" on page 47.

<TABLE>
<CAPTION>
                                              Nine Months Ended              Year Ended
                                             ------------------     ----------------------------
                                             March 29,    March 30, June 29,  June 30,  July 1,
                                               2003         2002      2002      2001    2000 (1)
                                             ---------    --------- --------  --------  --------
                                             (amounts in thousands, except per share information)
<S>                                          <C>          <C>       <C>       <C>       <C>
Selected Statements of Operations Data:
Revenue..................................... $229,294     $261,742  $342,727  $471,682  $471,152
Cost of services............................  178,226      203,407   264,766   377,498   364,881
                                             --------     --------  --------  --------  --------
Gross profit................................   51,068       58,335    77,961    94,184   106,271
Operating expenses..........................   51,269       58,104    76,040   116,425   129,584
Restructuring charge........................       --           --        --     7,060        --
                                             --------     --------  --------  --------  --------
Operating income (loss).....................     (201)         231     1,921   (29,301)  (23,313)
Net interest (expense) income...............   (2,250)     (11,785)  (12,577)   (6,334)   (5,272)
Common stock warrant charge.................       --       (1,020)   (1,048)       --        --
Other (expense) income......................      (29)       1,186     1,225       364       373
                                             --------     --------  --------  --------  --------
Net loss.................................... $ (2,480)    $(11,388) $(10,479) $(35,271) $(28,212)
                                             ========     ========  ========  ========  ========
Net loss applicable to common shareholders.. $ (3,355)    $(21,266) $(20,357) $(35,022) $(31,720)
                                             ========     ========  ========  ========  ========
Basic and diluted loss per common share..... $  (0.77)    $  (6.16) $  (5.82) $ (10.51) $ (11.37)
                                             ========     ========  ========  ========  ========
Basic and diluted weighted average number of
  common shares outstanding.................    4,355        3,450     3,500     3,333     2,790
</TABLE>

<TABLE>
<CAPTION>
                                                       As of
                                  -----------------------------------------------
                                  March 29, March 30, June 29, June 30,   July 1,
                                    2003      2002      2002     2001      2000
                                  --------- --------- -------- --------  --------
<S>                               <C>       <C>       <C>      <C>       <C>
Balance Sheet Data
Working capital (deficit)........ $(12,540) $ 16,562  $ 21,155 $ (2,809) $(18,607)
Total assets.....................  112,366   115,430   113,889  158,375   181,723
Long-term debt and capital leases    4,524    37,563    38,756   61,242    39,495
Redeemable preferred stock.......       --        --        --   35,421    25,261
Shareholders' equity (deficit)...   32,281    23,732    29,315  (31,592)   (1,123)
</TABLE>
--------
(1)During the first quarter of fiscal 2000, the Company acquired all the common
   stock of Velocity Express, Inc., formerly known as Corporate Express
   Delivery Systems, Inc. The results of operations of Velocity are included
   from the date of acquisition.

                                      17

<PAGE>

                      RATIO OF EARNINGS TO COMBINED FIXED
                     CHARGES AND PREFERRED STOCK DIVIDENDS

   The following table sets forth the ratio of earnings to combined fixed
charges and preferred stock dividends for Velocity Express on a historical
basis for the periods indicated.

    Nine Months Ended                      Year Ended,
    ----------------- --------------------------------------------------
                      June 29,   June 30,    July 1,   June 30,   June 30,
      March 29, 2003    2002       2001       2000       1999       1998
      --------------  ---------  ---------  ---------- ---------  ---------
          0.93          1.16      (3.54)    (3.42) (1) (721.80)    522.29
--------
(1)During the first quarter of fiscal 2000, the Company acquired all the common
   stock of Velocity Express, Inc., formerly known as Corporate Express
   Delivery, Inc. The results of operations of Velocity Express, Inc. are
   included from the date of acquisition.

   Velocity Express has not issued any shares of Series I Preferred and
currently has the ability to issue up to a total of 8,409,091 shares of Series
I Preferred, par value $0.004 per share. The ratio of earnings to combined
fixed charges and preferred stock dividends equals earnings divided by the sum
of our fixed charges and preferred stock dividends. For purposes of calculating
the ratio of earnings to combined fixed charges and preferred stock dividend,
earnings are the sum of income (loss) from continuing operations before income
taxes plus fixed charges reduced by capitalized interest and the preferred
stock dividend. Fixed charges consist of interest expensed and capitalized,
amortization of debt issue costs, preferred stock dividends, and that portion
of rental expense representative of the interest factor. For the nine months
ended March 29, 2003, earnings were insufficient to cover fixed charges and
preferred stock dividend by approximately $161,212. For the year ended June 30,
2001, earnings were insufficient to cover fixed charges and preferred stock
dividend by approximately $28,769,925. For the year ended July 1, 2000,
earnings were insufficient to cover fixed charges and preferred stock dividend
by approximately $23,313,000. For the year ended June 30, 1999, earnings were
insufficient to cover fixed charges and preferred stock dividend by
approximately $2,891,210.

                                      18

<PAGE>

                              THE RIGHTS OFFERING

Reasons for the Rights Offering

   On September 11, 2003, our board of directors discussed and authorized the
commencement of this rights offering.

   In reaching its conclusion, our board of directors considered a number of
factors, including:

  .  our need for additional capital and several alternative capital raising
     methods;

  .  the expected proceeds of approximately $18,500,000 from this rights
     offering;

  .  the subscription price relative to pricing policies customary for
     transactions of this type;

  .  the potential effect of this rights offering on relative ownership
     interests of our stockholders; and

  .  the potential tax consequences of this rights offering.

   After weighing the factors discussed above and the effect of the rights
offering of generating approximately $18.5 million in additional capital for
us, our board of directors believes that the rights offering is the best
alternative for capital raising and is in the best interests of the Company and
our stockholders. As described in "Use of Proceeds" on page 28, the proceeds of
the rights offering are intended to be used as support for a new revolving
credit facility and for general corporate purposes. Our board of directors
believes that the rights offering will ultimately strengthen our financial
condition through generating additional cash and increasing our stockholders'
equity. See "Use of Proceeds" on page 28 and "Capitalization" on page 30.
However, our board of directors is not making any recommendation as to whether
you should exercise your subscription rights.

The Rights

   We will distribute to each holder of our Common Stock or Preferred Stock who
is a record holder of such security on the record date, September 11, 2003, at
no charge, subscription rights to purchase our Series I Preferred Stock, up to
a total of 8,409,091 subscription rights. These subscription rights will be
distributed to our stockholders based on their percentage ownership of our
Common Stock on a fully diluted or as-converted basis on the record date.

   Accordingly, holders of one share of our Common Stock on the record date
will receive 0.297952777 rights. Holders of one share of our Series B Preferred
on the record date will receive 0.486231363 rights. Holders of one share of our
Series C Preferred on the record date will receive 0.329810541 rights. Holders
of one share of our Series D Preferred on the record date will receive
0.813565586 rights. Holders of one share of our Series F Preferred on the
record date will receive 1.745371947 rights. Holders of one share of our Series
G Preferred on the record date will receive 0.072517623 rights. Holders of one
share of our Series H Preferred on the record date will receive 2.979527767
rights. The subscription rights will be evidenced by nontransferable
subscription rights certificates. Each subscription right shall allow the
holder to subscribe for and purchase one share of our Series I Preferred Stock
at a price of $2.20 per share. The maximum gross proceeds of this rights
offering, assuming all the rights are exercised at the subscription price of
$2.20, will be $18,500,000.

   If you elect to exercise your basic subscription right in full, you may also
subscribe, at the subscription price, for additional shares of our Series I
Preferred under your over-subscription right to the extent that other rights
holders do not exercise their basic subscription rights in full. If the
remaining number of shares of our Series I Preferred is not available to fully
satisfy the over-subscription right requests, the available shares of Series I
Preferred will be sold pro rata among subscription right holders who exercised
their over-subscription rights based on the amount of over-subscription price
tendered by each person seeking to over-subscribe as of the expiration date of
the offering. We have not engaged an underwriter, placement agent or dealer
manager in connection with this rights offering.

                                      19

<PAGE>

Terms of Series I Preferred

   The Series I Preferred will rank senior to the Common Stock with respect to
rights of liquidation, dissolution and winding up and shall have the following
characteristics:

   Dividends. The Company is required to declare and pay to the holders of the
Series I Preferred, on an as-converted basis, any dividends declared or paid to
the Common Stock, whether such dividends are payable in cash, securities or
other property, other than dividends payable solely in shares of Common Stock.
There is no restriction on the repurchase or redemption of shares by the
Company while there is any arrearage in the payment of dividends to the Series
I Preferred.

   Liquidation. Upon any liquidation, dissolution and winding up of the
Velocity Express, each holder of Series I Preferred is entitled to receive an
amount in cash equal to $2.20 for each share of Series I Preferred, plus any
unpaid dividends thereon ("Series I Liquidation Preference"). If our assets are
insufficient to pay all liquidation preferences for all of its preferred stock,
we will first distribute our assets between the holders Series D Preferred,
Series F Preferred, Series G Preferred, Series H Preferred and Series I
Preferred on a pro rata basis dependant on the aggregate maximum liquidation
preference of all of the Series D Preferred, Series F Preferred, Series G
Preferred, Series H Preferred and Series I Preferred outstanding. The assets
remaining after this initial distribution will be shared between the holders of
Series B Preferred and Series C Preferred on a pro rata basis dependent on the
aggregate maximum liquidation preference of all outstanding Series B Preferred
and Series C Preferred. Any remaining assets will be distributed to holders of
the Common Stock.

   Voting Rights. The holders of shares of Series I Preferred are entitled to
receive notice of all stockholder meetings and to vote on all matters submitted
to the stockholders on an as-converted basis, voting together with the holders
of the Common Stock as a single class. The holders of Series I Preferred are
entitled to one vote for each share of Common Stock issuable upon conversion of
the Series I Preferred as of the record date of the stockholder vote, or if no
record date is specified, as of the date of the stockholder vote, to the extent
that such holder's voting power, together with the voting power held by its
affiliates, do not exceed 40% of the total voting power of all of the capital
stock of the Company entitled to vote. Therefore, to the extent that the
holders, together with its affiliates, will have voting power in excess of 40%
of all of our outstanding capital stock, the Series I Preferred, as held by
such holder or its affiliates, will not have any voting rights.

   For so long as at least 20% of the shares of Series I Preferred issued under
this rights offering remain outstanding, the affirmative vote of the holders of
two-thirds of the shares of Series I Preferred then outstanding are required
for the Company to (i) alter or change the preferences, rights or powers of the
Series I Preferred, or (ii) increase or decrease the authorized number of
shares of Series I Preferred.

   Conversion to Common Stock. To the extent that a holder, together with its
affiliates, will not hold 40% or more of all of the outstanding capital stock
of the Company, on an as converted basis, the holders of Series I Preferred, at
any time and from time to time, may convert all or any portion of the Series I
Preferred, including any fraction of a share, into shares of the Common Stock
(or shares or units of any security into which the Company's Common Stock is
changed). Therefore, to the extent that a holder, together with its affiliates,
will hold 40% or more of all of the outstanding capital stock of the Company,
on an as converted basis, after conversion of any Series I Preferred, the
Series I Preferred will not be convertible. Upon their issuance, each share of
Series I Preferred may be converted into ten shares of Common Stock, and
assuming that there is no restriction on their conversion, all of the Series I
Preferred as converted will represent approximately 57.81% of our outstanding
Common Stock on a fully diluted basis.

   The rate at which shares of Series I Preferred may be converted to Common
Stock shall be adjusted, from time to time, in order to prevent dilution of
this right to so convert held by the holders of the Series I Preferred. In the
event the Company issues or sells any shares of Common Stock or securities
convertible into or exercisable for Common Stock for a consideration per share
of Common Stock received or receivable upon conversion or exercise of such
securities, of less than the market price of the Common Stock, determined as of
the date of the

                                      20

<PAGE>

initial issue or sale, the conversion rate of the Series I Preferred shall be
proportionately adjusted to prevent dilution. The market price of the Common
Stock for this purpose is determined as the average closing price of the Common
Stock on The Nasdaq SmallCap Market for the twenty consecutive trading days
immediately prior to the day on which market price is being determined. Certain
permitted issuances, including, but not limited to options or shares granted
under the Company's stock option plans or the granting of options for up to
75,000 shares of Common Stock to employees and consultants of the Company
outside of the Company's stock option plans, will not trigger such an
adjustment to the rate of conversion.

Non-transferability of the Subscription Rights

   Except in the limited circumstances described below, only you may exercise
your subscription rights. You may not sell, give away or otherwise transfer
your subscription rights.

   Notwithstanding the foregoing, you may transfer your subscription rights to
any of your affiliates and your subscription rights also may be transferred by
operation of law; for example, a transfer of subscription rights to the estate
of the recipient upon the death of the recipient would be permitted. If the
subscription rights are transferred as permitted, evidence satisfactory to us
that the transfer was proper must be received by us prior to the expiration
time of the rights offering.

Expiration of the Rights Offering and Extensions, Amendments and Termination

   You may exercise your subscription rights at any time before 5:00 p.m., New
York City time, on           , 2003, the expiration time for this rights
offering. We may, in our sole discretion, extend the time for exercising the
subscription rights. If the commencement of this rights offering is delayed for
a period of time, the expiration date of this rights offering will be similarly
extended. We may extend the expiration date of this rights offering on or
before the scheduled expiration date. If we elect to extend the expiration of
this rights offering, we will issue a press release announcing such extension
no later than 9:00 a.m., New York City time, on the next business day after the
most recently announced expiration date.

   We reserve the right, in our sole discretion, to amend or modify the terms
of this rights offering.

   If you do not exercise your subscription rights before the expiration time
of this rights offering, your unexercised subscription rights will be null and
void and will have no value. We will not be obligated to honor your exercise of
subscription rights if we receive the documents relating to your exercise after
this rights offering expires, regardless of when you transmitted the documents,
except if you have timely transmitted the documents under the guaranteed
delivery procedures described below.

Subscription Rights

   Your subscription rights entitle you to a basic subscription right and an
over-subscription right.

  Basic Subscription Right

   With your basic subscription right, you may purchase one share of our Series
I Preferred per subscription right, upon delivery of the required documents and
payment of the subscription price of $2.20 per share. You are not required to
exercise all of your subscription rights unless you wish to purchase shares
under your over-subscription right. We will deliver to the record holders who
purchase shares in this rights offering certificates representing the shares
purchased with a holder's basic subscription right as soon as practicable after
this rights offering has expired.

  Over-Subscription Right

   In addition to your basic subscription right, you may subscribe for
additional shares of our Series I Preferred upon delivery of the required
documents and payment of the subscription price of $2.20 per share, before the

                                      21

<PAGE>

expiration of this rights offering. You may only exercise your
over-subscription right if you exercised your basic subscription right in full
and other holders of subscription rights do not exercise their basic
subscription rights in full.

  Pro Rata Allocation

   If there are not enough shares of our Series I Preferred to satisfy all
subscriptions made under the over-subscription right, we will allocate the
remaining shares of our Series I Preferred pro rata, after eliminating all
fractional shares, among those over-subscribing rights holders. "Pro rata"
means in proportion to the amount of subscription price tendered by each
subscription rights holder who wishes to exercise his or her over-subscription
rights prior to the expiration date. If there is a pro rata allocation of the
remaining shares of our Series I Preferred and you receive an allocation of a
greater number of shares than you subscribed for under your over-subscription
right, then we will allocate to you only the number of shares for which you
subscribed. We will allocate the remaining shares among all other holders
exercising their over-subscription rights.

  Full Exercise of Basic Subscription Right

   You may exercise your over-subscription right only if you exercise your
basic subscription right in full. To determine if you have fully exercised your
basic subscription right, we will consider only the basic subscription rights
held by you in the same capacity. For example, suppose that you were granted
subscription rights for shares of our Common Stock that you own individually
and shares of our Common Stock that you own collectively with your spouse. If
you wish to exercise your over-subscription right with respect to the
subscription rights you own individually, but not with respect to the
subscription rights you own collectively with your spouse, you only need to
fully exercise your basic subscription right with respect to your individually
owned subscription rights. You do not have to subscribe for any shares under
the basic subscription right owned collectively with your spouse to exercise
your individual over-subscription right.

   When you complete the portion of your subscription rights certificate to
exercise your over-subscription right, you will be representing and certifying
that you have fully exercised your basic subscription rights granted pursuant
to this prospectus. You must exercise your over-subscription rights at the same
time you exercise your basic subscription rights in full.

  Return of Excess Payment

   If you exercised your over-subscription right and are allocated less than
all of the shares of our Series I Preferred for which you wished to subscribe,
your excess payment for shares that were not allocated to you will be returned
to you by mail, without interest or deduction, as soon as practicable after the
expiration date of this rights offering. We will deliver to the record holders
who purchase shares in this rights offering certificates representing the
shares of our Series I Preferred that you purchased as soon as practicable
after the expiration date of this rights offering and after all pro rata
allocations and adjustments have been completed. However, we will not be able
to begin calculations for any pro rata allocations and adjustments until three
days after the expiration date, which is the latest date for our stockholders
to deliver the subscription rights certificate pursuant to the guaranteed
delivery procedures.

Effects of Rights Offering on our Stock Option Plans

   As of September 11, 2003, there were outstanding options to purchase
approximately 1,587,808 shares of Common Stock issued or committed to be issued
pursuant to stock options granted by Velocity Express. None of the outstanding
options have anti-dilution or other provisions of adjustment to exercise price
or number of shares which will be automatically triggered by the rights
offering. Each outstanding and unexercised option will remain unchanged and
will be exercisable for the same number of shares of Common Stock and at the
same exercise price as before the rights offering.

                                      22

<PAGE>

Effect of Issuance of Series I Preferred on the Company's Outstanding Preferred
Stock, Warrants and Convertible Indebtedness

   Since the subscription price to purchase the Series I Preferred is $2.20 per
share, the issuance of the Series I Preferred is dilutive to the holders of the
Company's outstanding capital stock, including the Series B Preferred, Series C
Preferred, Series D Preferred, Series F Preferred, Series G Preferred, Series H
Preferred and Common Stock. The issuance of the Series I Preferred is also
dilutive to the Company's various outstanding options and warrants. Of these
securities, each of the Preferred Stock and the Warrant to Purchase Common
Stock of Velocity Express Corporation (formerly United Shipping & Technology,
Inc.), dated as of September 24, 1999, issued to Bayview Capital Partners L.P.
(the "Bayview Warrant"), carry anti-dilution provisions in their conversion or
exercise rights.

   The exercise price of the Bayview Warrant and the conversion prices of each
of the Preferred Stock are required to be reduced on a weighted average basis
concurrent with any issuance by the Company of securities for a consideration
per share less than the market value of the Common Stock immediately prior to
the date the Company fixes the purchase price for such securities. This
weighted average reduction for the Preferred Stock would mean that the
conversion price is decreased to the mathematical result of (i) the conversion
price in effect immediately prior to such issuance multiplied by (ii) a
fraction, the numerator of which equals the sum of (y) the number of shares of
Common Stock outstanding on a fully diluted basis (in accordance with the
applicable certificate of designation) prior to such issuance multiplied by the
market value of the Common Stock on the day of such issuance plus (x) the
consideration received by the Company for such issuance, and the denominator of
which equals the product of the number of shares of Common Stock outstanding on
a fully diluted basis immediately after such issuance multiplied by the market
value immediately after such issuance. The weighted average reduction for the
Bayview Warrant would mean that the exercise price is decreased to the
mathematical result of (i) the exercise price in effect immediately prior to
such issuance multiplied by (ii) a fraction, the numerator of which equals the
sum of (y) the number of shares of Common Stock outstanding on a fully diluted
basis (in accordance with the Bayview Warrant) prior to such issuance plus (x)
the number of shares of Common Stock that the consideration received by the
Company for such issuance would have purchased if those shares were sold at the
market value, and the denominator of which equals the number of shares of
Common Stock outstanding on a fully diluted basis immediately after such
issuance. The market value of the Common Stock for the purpose of determining
whether the holders of the Preferred Stock and the Bayview Warrant have
contractual rights to a reduction of their respective conversion or exercise
prices because that security has been diluted is defined as the average closing
price of the Common Stock on The Nasdaq SmallCap Market for the twenty
consecutive trading days immediately prior to the record date, which is $0.673
per share.

   To better help you understand how the aggregate issuance of the Series I
Preferred has affected the conversion and exercise price of each of the
Preferred Stock and the Bayview Warrant, the following table lists the
conversion/exercise price of each security immediately before and immediately
after the issuance of all 8,409,091 shares of Series I Preferred.

<TABLE>
<CAPTION>
                        Exercise/Conversion Price Exercise/Conversion Price
     Class of Security      Prior to Issuance          After Issuance
     -----------------  ------------------------- -------------------------
     <S>                <C>                       <C>
     Series B Preferred           $5.24                     $2.84
     Series C Preferred           $4.99                     $2.70
     Series D Preferred           $2.70                     $1.46
     Series F Preferred           $1.88                     $1.02
     Series G Preferred           $3.08                     $1.67
     Series H Preferred           $1.00                     $0.54
     Bayview Warrant...           $6.71                     $3.63
</TABLE>

                                      23

<PAGE>

Method of Subscription-Exercise of Rights

   You may exercise your subscription rights by delivering the following to the
subscription agent at or prior to 5:00 p.m., New York City time, on           ,
the expiration time of this rights offering:

  .  Your properly completed and executed subscription rights certificate with
     any required signature guarantees or other supplemental documentation; and

  .  Your full subscription price payment for each share subscribed for under
     your subscription privileges.

   If you are a beneficial owner of our shares which are registered in the name
of a broker, custodian bank or other nominee, you should instruct your broker,
custodian bank or other nominee to exercise your rights and deliver all
documents and payment on your behalf prior to 5:00 p.m., New York City time, on
          , the expiration time of this rights offering.

   Your subscription rights will not be considered exercised unless the
subscription agent receives from you, or your broker, custodian or nominee, as
the case may be, all of the required documents and your full subscription price
payment prior to 5:00 p.m., New York City time, on           , the expiration
time of this rights offering.

Method of Payment

   Your payment of the subscription price must be made in U.S. dollars for the
full number of shares of Series I Preferred for which you are subscribing by
either:

  .  check or bank draft drawn upon a U.S. bank or postal, telegraphic or
     express money order payable to American Stock Transfer & Trust Company, as
     subscription agent for Velocity Express Corporation; or

  .  wire transfer of immediately available funds, to the subscription account
     maintained by the subscription agent at                     .

Receipt of Payment

   Your payment will be considered received by the subscription agent only upon:

  .  Clearance of any uncertified check;

  .  Receipt by the subscription agent of any certified check or bank draft
     drawn upon a U.S. bank or of any postal, telegraphic or express money
     order; or

  .  Receipt of collected funds in the subscription account designated above.

Clearance of Uncertified Checks

   If you are paying by uncertified personal check, please note that
uncertified checks may take five business days or more to clear. If you wish to
pay the subscription price by uncertified personal check, we urge you to make
payment sufficiently in advance of the time this rights offering expires to
ensure that your payment is received by the subscription agent and clears by
the rights offering expiration time. We urge you to consider using a certified
or cashier's check, money order or wire transfer of funds to avoid missing the
opportunity to invest in our Series I Preferred stock should you decide to
exercise your subscription rights.

                                      24

<PAGE>

Delivery of Subscription Materials and Payment

   You should deliver your subscription rights certificate and payment of the
subscription price or, if applicable, notices of guaranteed delivery, to the
subscription agent by one of the methods described below:

                By mail, hand delivery or overnight courier to:

                    American Stock Transfer & Trust Company
                                59 Maiden Lane
                              New York, NY 10038

          Notices of Guaranteed Delivery may be sent by facsimile to:

                                (718) 234-5001

             You may call us at (612) 492-2400 with any questions.

   Your delivery to an address or by any method other than as set forth above
will not constitute valid delivery.

Calculation of Subscription Rights Exercised

   If you do not indicate the number of subscription rights being exercised, or
do not forward full payment of the total subscription price for the number of
subscription rights that you indicate are being exercised, then you will be
deemed to have exercised your basic subscription right with respect to the
maximum number of subscription rights that may be exercised with the aggregate
subscription price payment you delivered to us. If your aggregate subscription
price payment is greater than the amount you owe for your subscription, you
will be deemed to have exercised your over-subscription right to purchase the
maximum number of shares of our Series I Preferred with your over-payment. If
we do not apply your full subscription price payment to your purchase of shares
of our Series I Preferred, we will return the excess amount to you by mail,
without interest or deduction, as soon as practicable after the expiration date
of this rights offering.

Your Funds will be Held by Us until Shares of Our Series I Preferred are Issued

   We will hold your payment of the subscription price in a segregated account
with other payments received from other subscription rights holders until we
issue your shares of our Series I Preferred to you upon consummation of the
rights offering.

Medallion Guarantee may be Required

   Your signature on each subscription rights certificate must be guaranteed by
an eligible institution, such as a member firm of a registered national
securities exchange or a member of the National Association of Securities
Dealers, Inc., or a commercial bank or trust company having an office or
correspondent in the U.S., subject to standards and procedures adopted by us,
unless:

  .  Your subscription rights certificate provides that shares are to be
     delivered to you as record holder of those subscription rights; or

  .  You are an eligible institution.

Notice to Recordholders holding on behalf of Beneficial Owners

   If you are a broker, a trustee or a depositary for securities who holds
shares of our capital stock for the account of others on the record date, you
should notify the respective beneficial owners of such shares of this rights
offering as soon as possible to find out their intentions with respect to
exercising their subscription rights. You should obtain instructions from the
beneficial owner with respect to their subscription rights, as set forth in

                                      25

<PAGE>

the instructions we have provided to you for your distribution to beneficial
owners. If the beneficial owner so instructs, you should complete the
appropriate subscription rights certificates and submit them to us with the
proper payment. If you hold shares of our stock for the account(s) of more than
one beneficial owner, you may exercise the number of subscription rights to
which all such beneficial owners in the aggregate otherwise would have been
entitled had they been direct record holders of our stock on the rights
offering record date, provided that you, as a nominee record holder, make a
proper showing to the subscription agent by submitting the form entitled
"Nominee Holder Certification" that we will provide to you with your rights
offering materials. If you did not receive this form, you should contact us to
request a copy.

Beneficial Owners

   If you are a beneficial owner of our capital stock or will receive your
subscription rights through a broker, custodian bank or other nominee, we will
ask your broker, custodian bank or other nominee to notify you of this rights
offering. If you wish to exercise your subscription rights, you will need to
have your broker, custodian bank or other nominee act for you. If you hold
certificates of our stock directly and would prefer to have your broker,
custodian bank or other nominee act for you, you should contact your nominee
and request it to effect the transactions for you. To indicate your decision
with respect to your subscription rights, you should complete and return to
your broker, custodian bank or other nominee the form entitled "Beneficial
Owners Election Form." You should receive this form from your broker, custodian
bank or other nominee with the other rights offering materials. If you wish to
obtain a separate subscription rights certificate, you should contact the
nominee as soon as possible and request that a separate subscription rights
certificate be issued to you. You should contact your broker, custodian bank or
other nominee if you do not receive this form, but believe that you are
entitled to participate in this rights offering. We are not responsible if you
do not receive the form from your broker, custodian bank or nominee or if you
receive it without sufficient time to respond.

Instructions for Completing Your Subscription Rights Certificate

   You should read and follow the instructions accompanying the subscription
rights certificates carefully.

   You are responsible for the method of delivery of your subscription rights
certificate(s) with your subscription price payment. If you send your
subscription rights certificate(s) and subscription price payment by mail, we
recommend that you send them by registered mail, properly insured, with return
receipt requested. You should allow a sufficient number of days to ensure
delivery to us prior to the time this rights offering expires. Because
uncertified personal checks may take at least five business days to clear, you
are strongly urged to pay, or arrange for payment, by means of a certified or
cashier's check, money order or wire transfer of funds.

Determinations Regarding the Exercise of Your Subscription Rights

   The subscription agent, at our direction, will decide at its discretion all
questions concerning the timeliness, validity, form and eligibility of the
exercise of your subscription rights and any such determinations by it will be
final and binding. The subscription agent, in its sole discretion, may waive,
in any particular instance, any defect or irregularity, or permit, in any
particular instance, a defect or irregularity to be corrected within such time
as it may determine. The subscription agent will not be required to make
uniform determinations in all cases. The subscription agent may reject the
exercise of any of your subscription rights because of any defect or
irregularity. The subscription agent will not accept any exercise of
subscription rights until all irregularities have been waived by it or cured by
you within such time as it decides, in its sole discretion.

   We will not be under any duty to notify you of any defect or irregularity in
connection with your submission of subscription rights certificates and we will
not be liable for failure to notify you of any defect or irregularity. We
reserve the right to reject your exercise of subscription rights if your
exercise is not in accordance with the terms of this rights offering or in
proper form. We will also not accept the exercise of your subscription rights
if our issuance of shares of our Series I Preferred to you could be deemed
unlawful under applicable law.

                                      26

<PAGE>

Regulatory Limitation

   We will not be required to issue to you shares of our Series I Preferred
pursuant to this rights offering if, in our opinion, you would be required to
obtain prior clearance or approval from any state or federal regulatory
authorities to own or control such shares if, at the time this rights offering
expires, you have not obtained such clearance or approval.

Guaranteed Delivery Procedures

   If you wish to exercise your subscription rights, but you do not have
sufficient time to deliver the subscription rights certificate evidencing your
subscription rights to us on or before the time this rights offering expires,
you may exercise your subscription rights by the following guaranteed delivery
procedures:

  .  Deliver to the subscription agent on or prior to the rights offering
     expiration time your subscription price payment in full for each share you
     subscribed for under your subscription rights in the manner set forth
     above in "--Method of Payment";

  .  Deliver to the subscription agent on or prior to the expiration time the
     form entitled "Notice of Guaranteed Delivery," substantially in the form
     provided with the "Instructions for Use of Velocity Express Subscription
     Rights Certificates" distributed with your subscription rights
     certificates; and

  .  Deliver the properly completed subscription rights certificate evidencing
     your subscription rights being exercised and the related nominee holder
     certification, if applicable, with any required signature guarantee, to
     the subscription agent within three business days following the date of
     your Notice of Guaranteed Delivery.

   Your Notice of Guaranteed Delivery must be delivered in substantially the
same form provided with the Instructions for Use of Velocity Express
Subscription Rights Certificates, which will be distributed to you with your
subscription rights certificate. Your Notice of Guaranteed Delivery must come
from an eligible institution, or other eligible guarantee institutions that are
members of, or participants in, a signature guarantee program acceptable to us.

   The Notice of Guaranteed Delivery must state:

  .  Your name and address;

  .  The certificate number of the subscription rights certificate relating to
     the subscription rights you are exercising;

  .  The number of subscription rights represented by your subscription rights
     certificates, the number of shares of our Series I Preferred for which you
     are subscribing under your basic subscription right and the number of
     shares of our Series I Preferred for which you are subscribing under your
     over-subscription right, if any; and

  .  The institution's guarantee that the subscription rights certificates
     evidencing the subscription rights you are exercising will be delivered to
     the subscription agent within three business days following the date that
     the subscription agent receives your Notice of Guaranteed Delivery.

   You may deliver your Notice of Guaranteed Delivery to the subscription agent
in the same manner as your subscription rights certificates at the address set
forth above under "--Delivery of Subscription Materials and Payment." We will
send you additional copies of the form of Notice of Guaranteed Delivery if you
request them. Please call (612) 492-2400 to request additional copies.

Questions about Exercising Subscription Rights

   If you have any questions or require assistance regarding the method of
exercising your subscription rights or requests for additional copies of this
prospectus, the Instructions for Use of Velocity Express Subscription

                                      27

<PAGE>

Rights Certificates or the Notice of Guaranteed Delivery, you should contact us
at the address and telephone number set forth above under "Questions and
Answers About the Rights Offering--What Should I do if I have Other Questions?"

No Revocation

   Once you have exercised your subscription rights, you may not revoke your
exercise. Subscription rights not exercised prior to the expiration time of
this rights offering will expire and will have no value.

Subscription Price

   The subscription price is $2.20 per share. For more information with respect
to how the subscription price was determined, see "Questions and Answers About
the Rights Offering--How was the $2.20 Per Share Subscription Price
Established?" included elsewhere in this prospectus.

Cancellation Rights

   Our board of directors may cancel this rights offering, in whole or in part,
in its sole discretion at any time prior to the time this rights offering
expires for any reason. If we cancel this rights offering, any funds you paid
to us will be promptly refunded, without interest or deduction.

No Board Recommendation

   An investment in shares of our Series I Preferred must be made according to
each investor's evaluation of its own best interests and after considering all
of the information in this prospectus, including the "Risk Factors" section of
this prospectus and all of the information incorporated by reference in this
prospectus. Neither we nor our board of directors make any recommendation to
subscription rights holders regarding whether they should exercise their
subscription rights.

Shares of Series I Preferred Outstanding after the Rights Offering

   Assuming all subscription rights are exercised, approximately 8,409,091
shares of our Series I Preferred will be issued and outstanding after this
rights offering expires.

Other Matters

   We are not making this rights offering in any state or other jurisdiction in
which it is unlawful to do so, nor are we distributing or accepting any offers
to purchase any shares of our Series I Preferred from subscription rights
holders who are residents of those states or other jurisdictions or who are
otherwise prohibited by federal or state laws or regulations from accepting or
exercising the subscription rights. We may delay the commencement of this
rights offering in those states or other jurisdictions, or change the terms of
this rights offering, in whole or in part, in order to comply with the
securities law or other legal requirements of those states or other
jurisdictions. We may decline to make modifications to the terms of this rights
offering requested by those states or other jurisdictions, in which case, if
you are a resident of those states or jurisdictions or if you are otherwise
prohibited by federal or state laws or regulations from accepting or exercising
the subscription rights you will not be eligible to participate in this rights
offering.

                                USE OF PROCEEDS

   If all of the subscription rights are exercised, the aggregate net proceeds
to Velocity Express from this offering would be approximately $18,390,000 after
deducting fees and estimated expenses of approximately $110,000. We currently
anticipate that we will apply such net proceeds to support a new revolving
credit facility, replacing certain letters of credit totaling $7.1 million
currently maintained by the Company and guaranteed by one of our major
stockholders, TH Lee Putnam Ventures, and for general corporate purposes. The
terms of the new revolving credit facility is being negotiated.

                                      28

<PAGE>

                PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

Price Range of Common Stock

   Since January 4, 2002, Velocity Express Common Stock has been listed on The
Nasdaq SmallCap Market and traded under the symbol "VEXP." On September 11,
2003, the record date for the rights offering, the closing price of our Common
Stock on The Nasdaq SmallCap Market was $0.62 per share. On           , 2003,
the last trading day prior to the date of this prospectus, the closing price of
our Common Stock on The Nasdaq SmallCap Market was $      per share.

   The following table sets forth, for the periods indicated, the reported high
and low closing sales prices of Velocity Express Common Stock on The Nasdaq
SmallCap Market, as restated for the effect of the one-for-five reverse stock
split effected on April 25, 2002.

<TABLE>
<CAPTION>
     Fiscal Year Quarter Ended                        High Price Low Price
     ----------- -------------                        ---------- ---------
     <C>         <S>                                  <C>        <C>
        2000     October 2, 1999.....................   $29.38    $13.13
                 January 1, 2000.....................    47.81     19.38
                 April 1, 2000.......................    88.44     36.25
                 July 1, 2000........................    70.00     39.06

        2001     September 30, 2000..................    45.47     19.69
                 December 30, 2000...................    24.38      8.75
                 March 31, 2001......................    12.50      3.75
                 June 30, 2001.......................     3.75      2.00

        2002     September 29, 2001..................     5.45      2.65
                 December 29, 2001...................    14.50      4.50
                 March 30, 2002......................    17.00      7.55
                 June 29, 2002.......................     9.95      2.98

        2003     September 28, 2002..................     3.20      1.87
                 December 28, 2002...................     1.94      0.64
                 March 29, 2003......................     0.94      0.60
                 June 28, 2003.......................     0.98      0.61

        2003     September 11, 2003 (the record date)     0.90      0.61
</TABLE>

Dividends

   Velocity Express has not paid any cash dividends on its Common Stock or its
Preferred Stock since its organization and it is not contemplated that any cash
dividends will be paid on its Common Stock or Preferred Stock in the
foreseeable future.

                                      29

<PAGE>

                                CAPITALIZATION

   The following table shows our capitalization as of March 29, 2003, on a
historical basis and as adjusted to give effect to the issuance of our Series H
Call Warrants described in footnote (1) below. The table also includes our
capitalization on a pro forma basis assuming the completion of the rights
offering and all of the Series I Preferred were issued at the subscription
price on March 29, 2003.

<TABLE>
<CAPTION>
                                                                         Pro Forma Adjustments
                                                           ------------------------------------------------
                                                            March 29,    Series H       Rights        As
                                                              2003     Preferred (1)   Offering    Adjusted
                                                           ----------- ------------- --------     ---------
                                                           (unaudited)
<S>                                                        <C>         <C>           <C>          <C>
Cash......................................................  $   1,421     $    --    $ 18,500     $  19,921
                                                            =========     =======    ========     =========
Long-term debt less current portion.......................      4,524          --          --         4,524
Shareholders' equity
   Preferred stock, $0.004 par value, 50,000,000 shares
     authorized, 13,865,000 shares issued and outstanding
     at March 29, 2003....................................     66,777          --      18,500        85,277
   Preferred warrants, 1,042,000 outstanding at March 29,
     2003.................................................      7,600          --          --         7,600
   Common stock, $0.004 par value, 150,000,000 shares
     authorized, 4,719,000 shares issued and outstanding
     at March 29, 2003....................................         19          --          --            19
   Stock subscription receivable..........................        (38)         --          --           (38)
   Additional paid-in-capital.............................     61,172       2,475      18,500(2)     82,147
   Accumulated deficit....................................   (103,121)     (2,475)    (18,500)(2)  (124,096)
   Foreign currency translation...........................       (128)         --          --          (128)
                                                            ---------     -------    --------     ---------
       Total stockholders' equity.........................     32,281          --      18,500        50,781
                                                            ---------     -------    --------     ---------
Total Capitalization......................................  $  36,805     $    --    $ 18,500     $  55,305
                                                            =========     =======    ========     =========
</TABLE>
--------
(1)To reflect the issuance of the Series H Call Warrants on May 1, 2003.
(2)Represents the Company's best estimate of the beneficial conversion related
   to the issuance of the Series I Preferred.

                                      30

<PAGE>

                         DESCRIPTION OF CAPITAL STOCK

   This section contains a description of our capital stock. This description
includes a summary of the terms of the Common Stock, Series B Preferred, Series
C Preferred, Series D Preferred, Series F Preferred, Series G Preferred and
Series H Preferred. The summaries of the Common Stock and Preferred Stock are
qualified in their entirety by reference to the full text of our Certificate of
Incorporation (the "Charter"), including the Certificates of Designation of all
of the Preferred Stock, the bylaws of the Company and the General Corporation
Law of the State of Delaware, or DGCL.

   Under the Charter, our authorized capital stock consists of 150,000,000
shares of Common Stock and 50,000,000 shares of Preferred Stock.

Common Stock

   As of September 11, 2003, there were 5,443,993 shares of Common Stock
outstanding. The Common Stock has a par value of $0.004 per share.

  Dividends

   Subject to the prior rights of the holders of our Preferred Stock, holders
of Common Stock are entitled to receive such dividends and other distributions
in cash, stock or property of Velocity Express as may be declared by our board
of directors from time to time, out of assets or funds legally available for
dividends, provided that in the case of cash dividends or dividends of assets,
we are required to declare and pay to the holders of our Preferred Stock on an
as-converted basis any dividends declared or paid on the Common Stock.

  Voting Rights

   Each share of Common Stock is entitled to one vote per share on all matters
submitted to our stockholders, including election of directors. The holders of
the Common Stock generally vote together with the holders of our Preferred
Stock as a single class.

  Liquidation Rights

   In the event of any dissolution, liquidation or winding up of the affairs of
Velocity Express, after payment or provision for payment of our debts and other
liabilities and any amounts to which the holders of our Preferred Stock are
entitled, our remaining assets and funds will be divided among the holders of
the Common Stock.

  Listing and Transfer Agent

   Our Common Stock is listed on The Nasdaq SmallCap Market under the symbol
"VEXP." American Stock Transfer & Trust Company is the transfer agent and
registrar for our Common Stock.

Preferred Stock Voting Rights

   Each holder of the Series B Preferred, Series C Preferred, Series D
Preferred and Series F Preferred is entitled to receive notice of all
stockholder meetings and to vote on all matters submitted to the stockholders
on an as-converted basis, voting together with the holders of the Common Stock
as a single class. Each such holder is entitled to one vote for each share of
Common Stock issuable upon conversion of the pertinent Preferred Stock as of
the record date of the stockholder vote, or if no record date is specified, as
of the date of the stockholder vote. Furthermore, holders of Series B
Preferred, voting separately as a single class, are entitled to elect one
director to serve on our board of directors and all of the committees of the
board of directors and to limit the size of our board of directors.

                                      31

<PAGE>

   Additionally, we can not take any of the actions set forth below without
first obtaining the affirmative vote of the holders of at least two-thirds of
the then outstanding shares of Series B Preferred, Series C Preferred, Series D
Preferred and Series F Preferred, voting as a class:

  .  sell, lease or otherwise dispose of any our assets or the assets of our
     subsidiaries, except for sales, leases or dispositions outside of the
     ordinary course of business, consistent with past custom and practice;

  .  merge or consolidate with any person or entity; provided, that our
     directly or indirectly wholly owned subsidiaries may merge with and into
     Velocity Express; and

  .  effect any other transaction or series of related transactions involving
     Velocity Express, the result of which is that any person becomes the
     beneficial owner (as determined in accordance with Rules 13d-3 and 13d-5
     under the Exchange Act, except that a person will be deemed to have
     beneficial ownership of all shares that such person has the right to
     acquire, whether such right is exercisable immediately or only after the
     passage of time), directly or indirectly, of more than 40% of the voting
     securities of the Company.

   Furthermore, we cannot take any of the following actions without first
obtaining the affirmative vote of the holders of at least two-thirds of the
then outstanding shares of each series of Series B Preferred, Series C
Preferred, Series D Preferred or Series F Preferred, expressly authorized to
vote as a series, each voting together as a separate series, for so long as at
least 20% of the relevant series of Preferred Stock originally issued remains
outstanding:

  .  alter or change the preferences, rights or powers of the relevant series
     of Preferred Stock (provided that only the series directly affected is
     entitled to vote as a series under this provision);

  .  increase or decrease the authorized number of shares of the relevant
     series of these Preferred Stock (provided that only the affected series is
     entitled to vote as a series under this provision);

  .  directly or indirectly declare or pay any dividends or make any
     distributions upon, or repurchase or redeem, any of our capital stock or
     other equity securities (or any securities directly or indirectly
     convertible into or exercisable or exchangeable for equity securities),
     other than certain repurchases of options, or its underlying Common Stock,
     issued pursuant to our stock option plans pursuant to the terms of the
     options and other than the mandatory repurchase of certain warrants issued
     to Bayview, provided, however, that:

    .  with respect to dividends, distributions, repurchases or redemptions
       involving the Series B Preferred, only the Series C Preferred Stock is
       entitled to vote as a series under this provision,

    .  with respect to dividends, distributions, repurchases or redemptions
       involving the Series C Preferred, only the Series B Preferred Stock is
       entitled to vote as a series under this provision, and

    .  with respect to dividends, distributions, repurchases or redemptions
       involving the Series D Preferred Stock or the Series F Preferred Stock,
       only the Series B Preferred Stock and the Series C Preferred Stock are
       entitled to vote as separate series under this provision;

  .  issue any additional Series B Preferred (other than in connection with the
     exercise of the certain warrants for Series B Preferred) or Series C
     Preferred or create, authorize or issue any capital stock that ranks prior
     (whether with respect to dividends or upon liquidation, dissolution,
     winding up or otherwise) to or pari passu with the Series B Preferred or
     Series C Preferred (provided that only Series B Preferred Stock and Series
     C Preferred Stock are entitled to vote as separate series under this
     provision);

  .  issue any additional Series D Preferred or Series F Preferred or create,
     authorize or issue any capital stock that ranks prior to (whether with
     respect to dividends or upon liquidation, dissolution, winding up or
     otherwise) the Series D Preferred or Series F Preferred (provided that
     only Series D Preferred Stock and Series F Preferred Stock are entitled to
     vote as separate series under this provision);

                                      32

<PAGE>

  .  amend, alter, repeal or waive any provision of our Certificate of
     Incorporation (including any certificate of amendment and whether by
     amendment, merger or otherwise) or our Bylaws (provided that only Series B
     Preferred and Series C Preferred are entitled to vote as separate series
     under this provision);

  .  liquidate, dissolve or effect a recapitalization or reorganization in any
     form of transaction (including, without limitation, any reorganization
     into a limited liability company, a partnership or any other non-corporate
     entity which is treated as a partnership for federal income tax purposes)
     (provided that only Series B Preferred Stock and Series C Preferred Stock
     are entitled to vote as separate series under this provision);

  .  create, incur, assume or suffer to exist, or permit any of our subsidiary
     to create, incur, assume or suffer to exist, any liens on all or
     substantially all of the assets of Velocity Express and our subsidiaries
     with respect to any indebtedness which is in excess of $5,000,000 in the
     aggregate; and

  .  authorize the issuance of any Common Stock or securities convertible into
     Common Stock at a price below market price (as defined in our Certificate
     of Incorporation); provided, that in the event we receives the approval of
     the Series B Preferred, this limitation shall automatically terminate and
     be of no further force and effect (and provided further that only Series B
     Preferred Stock is entitled to vote as a series under this provision).

Series B Convertible Preferred Stock

   As of September 11, 2003, there were 2,806,797 shares of Series B Preferred
outstanding. The Series B Preferred has a par value of $0.004 per share.

  Dividends

   We are required to declare and pay to the holders of the Series B Preferred
on an as-converted basis any dividends declared or paid to the Common Stock,
whether such dividends are payable in cash, securities or other property, other
than dividends payable solely in shares of Common Stock. There is no
restriction on the repurchase or redemption of shares by the Company while
there is any arrearage in the payment of dividends to the Series B Preferred.

  Liquidation

   Upon any liquidation, dissolution and winding up of the Company, each holder
of Series B Preferred is entitled to receive an amount in cash equal to $9.00
for each share of Series B Preferred, plus any unpaid dividends thereon. If the
Company's assets are insufficient to pay all liquidation preferences for all of
its preferred stock, the Company will first distribute its assets between the
holders Series D Preferred, Series F Preferred, Series G Preferred and Series H
Preferred, on a pro rata basis dependant on the aggregate maximum liquidation
preference of all of the Series D Preferred, Series F Preferred, Series G
Preferred and Series H Preferred outstanding. The assets remaining after this
initial distribution will be shared between the holders of Series B Preferred
and Series C Preferred on a pro rata basis dependent on the aggregate maximum
liquidation preference of all outstanding Series B Preferred and Series C
Preferred. Any remaining assets will be distributed to holders of the Common
Stock.

  Conversion to Common Stock

   The holders of Series B Preferred, at any time and from time to time, may
convert all or any portion of the Series B Preferred, including any fraction of
a share, into shares of the Common Stock (or shares or units of any security
into which the Company's Common Stock is changed). The rate at which shares of
Series B Preferred may be converted to Common Stock shall be adjusted, from
time to time, in order to prevent dilution of this right to so convert held by
the holders of the Series B Preferred. In the event the Company issues or sells
any shares of Common Stock or securities convertible into or exercisable for
Common Stock for a consideration per share of

                                      33

<PAGE>

Common Stock received or receivable upon conversion or exercise of such
securities, of less than the market price of the Common Stock, determined as of
the date of the initial issue or sale, the conversion rate of the Series B
Preferred shall be proportionately adjusted to prevent dilution. The market
price of the Common Stock for this purpose is determined as the average closing
price of the Common Stock on The Nasdaq SmallCap Market for the twenty
consecutive trading days immediately prior to the day on which market price is
being determined. Certain permitted issuances, including, but not limited to
options or shares granted under the Company's stock option plans or the
granting of options for up to 75,000 shares of Common Stock to employees and
consultants of the Company outside of the Company's stock option plans, will
not trigger such an adjustment to the rate of conversion. As of September 11,
2003, the conversion ratio of the Series B Preferred is one share of Series B
Preferred convertible into 1.632 shares of Common Stock. As of September 11,
2003, the shares of Series B Preferred outstanding would be convertible into
4,580,433 shares of Common Stock, representing approximately 11.65% of the
Company's outstanding Common Stock on a fully diluted basis. This conversion
ratio takes into account the one-for-five reverse stock split of our Common
Stock effected on April 25, 2002.

  Listing and Transfer Agent

   Our Series B Preferred is not listed. Velocity Express acts as the transfer
agent and registrar for the Series B Preferred.

Series C Convertible Preferred Stock

   As of September 11, 2003, there were 2,000,000 shares of Series C Preferred
outstanding. The Series C Preferred has a par value of $0.004 per share.

  Dividends

   We are required to declare and pay to the holders of the Series C Preferred
on an as-converted basis any dividends declared or paid to the Common Stock,
whether such dividends are payable in cash, securities or other property, other
than dividends payable solely in shares of Common Stock. There is no
restriction on the repurchase or redemption of shares by the Company while
there is any arrearage in the payment of dividends to the Series C Preferred.

  Liquidation

   Upon any liquidation, dissolution and winding up of the Company, each holder
of Series C Preferred is entitled to receive an amount in cash equal to $6.00
for each share of Series C Preferred, plus any unpaid dividends thereon. If the
Company's assets are insufficient to pay all liquidation preferences for all of
its preferred stock, the Company will first distribute its assets between the
holders Series D Preferred, Series F Preferred, Series G Preferred and Series H
Preferred, on a pro rata basis dependant on the aggregate maximum liquidation
preference of all of the Series D Preferred, Series F Preferred, Series G
Preferred and Series H Preferred outstanding. The assets remaining after this
initial distribution will be shared between the holders of Series B Preferred
and Series C Preferred on a pro rata basis dependent on the aggregate maximum
liquidation preference of all outstanding Series B Preferred and Series C
Preferred. Any remaining assets will be distributed to holders of the Common
Stock.

  Conversion to Common Stock

   The holders of Series C Preferred, at any time and from time to time, may
convert all or any portion of the Series C Preferred, including any fraction of
a share, into shares of the Common Stock (or shares or units of any security
into which the Company's Common Stock is changed). The rate at which shares of
Series C Preferred may be converted to Common Stock shall be adjusted, from
time to time, in order to prevent dilution of this right to so convert held by
the holders of the Series C Preferred. In the event the Company issues or sells
any shares of Common Stock or securities convertible into or exercisable for
Common Stock for a consideration per share of

                                      34

<PAGE>

Common Stock received or receivable upon conversion or exercise of such
securities, of less than the market price of the Common Stock, determined as of
the date of the initial issue or sale, the conversion rate of the Series C
Preferred shall be proportionately adjusted to prevent dilution. The market
price of the Common Stock for this purpose is determined as the average closing
price of the Common Stock on The Nasdaq SmallCap Market for the twenty
consecutive trading days immediately prior to the day on which market price is
being determined. Certain permitted issuances, including, but not limited to
options or shares granted under the Company's stock option plans or the
granting of options for up to 75,000 shares of Common Stock to employees and
consultants of the Company outside of the Company's stock option plans, will
not trigger such an adjustment to the rate of conversion. As of September 11,
2003, the conversion ratio of the Series C Preferred is one share of Series C
Preferred convertible into 1.107 shares of Common Stock. As of September 11,
2003, the shares of Series C Preferred outstanding would be convertible into
2,213,844 shares of Common Stock, representing approximately 5.63% of the
Company's outstanding Common Stock on a fully diluted basis. This conversion
ratio takes into account the one-for-five reverse stock split of our Common
Stock effected on April 25, 2002.

  Listing and Transfer Agent

   Our Series C Preferred is not listed. Velocity Express acts as the transfer
agent and registrar for the Series C Preferred.

Series D Convertible Preferred Stock

   As of September 11, 2003, there were 1,517,444 shares of Series D Preferred
outstanding. The Series D Preferred has a par value of $0.004 per share.

  Dividends

   We are required to declare and pay to the holders of the Series D Preferred
on an as-converted basis any dividends declared or paid to the Common Stock,
whether such dividends are payable in cash, securities or other property, other
than dividends payable solely in shares of Common Stock. There is no
restriction on the repurchase or redemption of shares by the Company while
there is any arrearage in the payment of dividends to the Series D Preferred.

  Liquidation

   Upon any liquidation, dissolution and winding up of the Company, each holder
of Series D Preferred is entitled to receive an amount in cash equal to $8.00
for each share of Series D Preferred, plus any unpaid dividends thereon. If the
Company's assets are insufficient to pay all liquidation preferences for all of
its preferred stock, the Company will first distribute its assets between the
holders Series D Preferred, Series F Preferred, Series G Preferred and Series H
Preferred, on a pro rata basis dependant on the aggregate maximum liquidation
preference of all of the Series D Preferred, Series F Preferred, Series G
Preferred and Series H Preferred outstanding. The assets remaining after this
initial distribution will be shared between the holders of Series B Preferred
and Series C Preferred on a pro rata basis dependent on the aggregate maximum
liquidation preference of all outstanding Series B Preferred and Series C
Preferred. Any remaining assets will be distributed to holders of the Common
Stock.

  Conversion to Common Stock

   The holders of Series D Preferred, at any time and from time to time, may
convert all or any portion of the Series D Preferred, including any fraction of
a share, into shares of the Common Stock (or shares or units of any security
into which the Company's Common Stock is changed). The rate at which shares of
Series D Preferred may be converted to Common Stock shall be adjusted, from
time to time, in order to prevent dilution of this right to so convert held by
the holders of the Series D Preferred. In the event the Company issues or sells
any shares of Common Stock or securities convertible into or exercisable for
Common Stock for a consideration per share of

                                      35

<PAGE>

Common Stock received or receivable upon conversion or exercise of such
securities, of less than the market price of the Common Stock, determined as of
the date of the initial issue or sale, the conversion rate of the Series D
Preferred shall be proportionately adjusted to prevent dilution. The market
price of the Common Stock for this purpose is determined as the average closing
price of the Common Stock on The Nasdaq SmallCap Market for the twenty
consecutive trading days immediately prior to the day on which market price is
being determined. Certain permitted issuances, including, but not limited to
options or shares granted under the Company's stock option plans or the
granting of options for up to 75,000 shares of Common Stock to employees and
consultants of the Company outside of the Company's stock option plans, will
not trigger such an adjustment to the rate of conversion. As of September 11,
2003, the conversion ratio of the Series D Preferred is one share of Series D
Preferred convertible into 2.962 shares of Common Stock. As of September 11,
2003, the shares of Series D Preferred outstanding would be convertible into
4,143,409 shares of Common Stock, representing approximately 10.54% of the
Company's outstanding Common Stock on a fully diluted basis. This conversion
ratio takes into account the one-for-five reverse stock split of our Common
Stock effected on April 25, 2002.

  Listing and Transfer Agent

   Our Series D Preferred is not listed. Velocity Express acts as the transfer
agent and registrar for the Series D Preferred.

Series F Convertible Preferred Stock

   As of September 11, 2003, there were 924,170 shares of Series F Preferred
outstanding. The Series F Preferred has a par value of $0.004 per share.

  Dividends

   We are required to declare and pay to the holders of the Series F Preferred
on an as-converted basis any dividends declared or paid to the Common Stock,
whether such dividends are payable in cash, securities or other property, other
than dividends payable solely in shares of Common Stock. There is no
restriction on the repurchase or redemption of shares by the Company while
there is any arrearage in the payment of dividends to the Series F Preferred.

  Liquidation

   Upon any liquidation, dissolution and winding up of the Company, each holder
of Series F Preferred is entitled to receive an amount in cash equal to $11.00
for each share of Series F Preferred, plus any unpaid dividends thereon. If the
Company's assets are insufficient to pay all liquidation preferences for all of
its preferred stock, the Company will first distribute its assets between the
holders Series D Preferred, Series F Preferred, Series G Preferred and Series H
Preferred, on a pro rata basis dependant on the aggregate maximum liquidation
preference of all of the Series D Preferred, Series F Preferred, Series G
Preferred and Series H Preferred outstanding. The assets remaining after this
initial distribution will be shared between the holders of Series B Preferred
and Series C Preferred on a pro rata basis dependent on the aggregate maximum
liquidation preference of all outstanding Series B Preferred and Series C
Preferred. Any remaining assets will be distributed to holders of the Common
Stock.

  Conversion to Common Stock

   The holders of Series F Preferred, at any time and from time to time, may
convert all or any portion of the Series F Preferred, including any fraction of
a share, into shares of the Common Stock (or shares or units of any security
into which the Company's Common Stock is changed). The rate at which shares of
Series F Preferred may be converted to Common Stock shall be adjusted, from
time to time, in order to prevent dilution of this right to so convert held by
the holders of the Series F Preferred. In the event the Company issues or sells
any shares of Common Stock or securities convertible into or exercisable for
Common Stock for a consideration per share of

                                      36

<PAGE>

Common Stock received or receivable upon conversion or exercise of such
securities, of less than the market price of the Common Stock, determined as of
the date of the initial issue or sale, the conversion rate of the Series F
Preferred shall be proportionately adjusted to prevent dilution. The market
price of the Common Stock for this purpose is determined as the average closing
price of the Common Stock on The Nasdaq SmallCap Market for the twenty
consecutive trading days immediately prior to the day on which market price is
being determined. Certain permitted issuances, including, but not limited to
options or shares granted under the Company's stock option plans or the
granting of options for up to 75,000 shares of Common Stock to employees and
consultants of the Company outside of the Company's stock option plans, will
not trigger such an adjustment to the rate of conversion. As of September 11,
2003, the conversion ratio of the Series F Preferred is one share of Series F
Preferred convertible into 5.858 shares of Common Stock. As of September 11,
2003, the shares of Series F Preferred outstanding would be convertible into
5,413,678 shares of Common Stock, representing approximately 13.78% of the
Company's outstanding Common Stock on a fully diluted basis. This conversion
ratio takes into account the one-for-five reverse stock split of our Common
Stock effected on April 25, 2002.

  Listing and Transfer Agent

   Our Series F Preferred is not listed. Velocity Express acts as the transfer
agent and registrar for the Series F Preferred.

Series G Convertible Preferred Stock

   As of September 11, 2003, there were 5,865,331 shares of Series G Preferred
outstanding. The Series G Preferred has a par value of $0.004 per share.

  Dividends

   We are required to declare and pay to the holders of the Series G Preferred
on an as-converted basis any dividends declared or paid to the Common Stock,
whether such dividends are payable in cash, securities or other property, other
than dividends payable solely in shares of Common Stock. There is no
restriction on the repurchase or redemption of shares by the Company while
there is any arrearage in the payment of dividends to the Series G Preferred.

  Liquidation

   Upon any liquidation, dissolution and winding up of the Company, each holder
of Series G Preferred is entitled to receive an amount in cash equal to $0.75
for each share of Series G Preferred, plus any unpaid dividends thereon. If the
Company's assets are insufficient to pay all liquidation preferences for all of
its preferred stock, the Company will first distribute its assets between the
holders Series D Preferred, Series F Preferred, Series G Preferred and Series H
Preferred, on a pro rata basis dependant on the aggregate maximum liquidation
preference of all of the Series D Preferred, Series F Preferred, Series G
Preferred and Series H Preferred outstanding. The assets remaining after this
initial distribution will be shared between the holders of Series B Preferred
and Series C Preferred on a pro rata basis dependent on the aggregate maximum
liquidation preference of all outstanding Series B Preferred and Series C
Preferred. Any remaining assets will be distributed to holders of the Common
Stock.

  Voting Rights

   The holders of shares of Series G Preferred are entitled to receive notice
of all stockholder meetings and to vote on all matters submitted to the
stockholders on an as-converted basis, voting together with the holders of the
Common Stock as a single class. The holders of Series G Preferred are entitled
to one vote for each share of Common Stock issuable upon conversion of the
Series G Preferred as of the record date of the stockholder vote, or if no
record date is specified, as of the date of the stockholder vote.

                                      37

<PAGE>

   For so long as at least 20% of the shares of Series G Preferred issued under
the original Series G stock purchase agreements remain outstanding, the
affirmative vote of the holders of two-thirds of the shares of Series G
Preferred then outstanding is required for the Company to (i) alter or change
the preferences, rights or powers of the Series G Preferred, or (ii) increase
or decrease the authorized number of shares of Series G Preferred.

  Conversion to Common Stock

   The holders of Series G Preferred, at any time and from time to time, may
convert all or any portion of the Series G Preferred, including any fraction of
a share, into shares of the Common Stock (or shares or units of any security
into which the Company's Common Stock is changed). The rate at which shares of
Series G Preferred may be converted to Common Stock shall be adjusted, from
time to time, in order to prevent dilution of this right to so convert held by
the holders of the Series G Preferred. In the event the Company issues or sells
any shares of Common Stock or securities convertible into or exercisable for
Common Stock for a consideration per share of Common Stock received or
receivable upon conversion or exercise of such securities, of less than the
market price of the Common Stock, determined as of the date of the initial
issue or sale, the conversion rate of the Series G Preferred shall be
proportionately adjusted to prevent dilution. The market price of the Common
Stock for this purpose is determined as the average closing price of the Common
Stock on The Nasdaq SmallCap Market for the twenty consecutive trading days
immediately prior to the day on which market price is being determined. Certain
permitted issuances, including, but not limited to options or shares granted
under the Company's stock option plans or the granting of options for up to
75,000 shares of Common Stock to employees and consultants of the Company
outside of the Company's stock option plans, will not trigger such an
adjustment to the rate of conversion. As of September 11, 2003, the conversion
ratio of the Series G Preferred, assuming that it was convertible then, is one
share of Series G Preferred convertible into 0.243 shares of Common Stock. As
of September 11, 2003, the shares of Series G Preferred outstanding would be
convertible, assuming that it was convertible then, into 1,427,541 shares of
Common Stock, representing approximately 3.63% of the Company's outstanding
Common Stock on a fully diluted basis. This conversion ratio takes into account
the one-for-five reverse stock split of our Common Stock effected on April 25,
2002.

  Listing and Transfer Agent

   Our Series G Preferred is not listed. Velocity Express acts as the transfer
agent and registrar for the Series G Preferred.

Series H Convertible Preferred Stock

   As of September 11, 2003, there were 5,000,000 shares of Series H Preferred
outstanding. The Series H Preferred has a par value of $0.004 per share.

  Dividends

   The Company is required to declare and pay to the holders of the Series H
Preferred on an as-converted basis any dividends declared or paid to the Common
Stock, whether such dividends are payable in cash, securities or other
property, other than dividends payable solely in shares of Common Stock. There
is no restriction on the repurchase or redemption of shares by the Company
while there is any arrearage in the payment of dividends to the Series H
Preferred.

  Liquidation

   Upon any liquidation, dissolution and winding up of the Company, each holder
of Series H Preferred is entitled to receive an amount in cash equal to $10 for
each share of Series H Preferred, plus any unpaid dividends thereon. If the
Company's assets are insufficient to pay all liquidation preferences for all of
its preferred stock, the Company will first distribute its assets between the
holders Series D Preferred, Series F Preferred, Series G

                                      38

<PAGE>

Preferred and Series H Preferred, on a pro rata basis dependant on the
aggregate maximum liquidation preference of all of the Series D Preferred,
Series F Preferred, Series G Preferred and Series H Preferred outstanding. The
assets remaining after this initial distribution will be shared between the
holders of Series B Preferred and Series C Preferred on a pro rata basis
dependent on the aggregate maximum liquidation preference of all outstanding
Series B Preferred and Series C Preferred. Any remaining assets will be
distributed to holders of the Common Stock.

  Voting Rights

   The holders of shares of Series H Preferred are entitled to receive notice
of all stockholder meetings and to vote on all matters submitted to the
stockholders on an as-converted basis, voting together with the holders of the
Common Stock as a single class. The holders of Series H Preferred are entitled
to one vote for each share of Common Stock issuable upon conversion of the
Series H Preferred as of the record date of the stockholder vote, or if no
record date is specified, as of the date of the stockholder vote.

   For so long as at least 20% of the shares of Series H Preferred issued under
the original Series H stock purchase agreements remain outstanding, the
affirmative vote of the holders of two-thirds of the shares of Series H
Preferred then outstanding are required for the Company to (i) alter or change
the preferences, rights or powers of the Series H Preferred, or (ii) increase
or decrease the authorized number of shares of Series H Preferred.

  Conversion to Common Stock

   The holders of Series H Preferred, at any time and from time to time, may
convert all or any portion of the Series H Preferred, including any fraction of
a share, into shares of the Common Stock (or shares or units of any security
into which the Company's Common Stock is changed). Each share of Series H
Preferred currently may be converted into ten shares of Common Stock. The rate
at which shares of Series H Preferred may be converted to Common Stock shall be
adjusted, from time to time, in order to prevent dilution of this right to so
convert held by the holders of the Series H Preferred. In the event the Company
issues or sells any shares of Common Stock or securities convertible into or
exercisable for Common Stock for a consideration per share of Common Stock
received or receivable upon conversion or exercise of such securities, of less
than the market price of the Common Stock, determined as of the date of the
initial issue or sale, the conversion rate of the Series H Preferred shall be
proportionately adjusted to prevent dilution. The market price of the Common
Stock for this purpose is determined as the average closing price of the Common
Stock on The Nasdaq SmallCap Market for the twenty consecutive trading days
immediately prior to the day on which market price is being determined. Certain
permitted issuances, including, but not limited to options or shares granted
under the Company s stock option plans or the granting of options for up to
75,000 shares of Common Stock to employees and consultants of the Company
outside of the Company s stock option plans, will not trigger such an
adjustment to the rate of conversion. As of September 11, 2003, the conversion
ratio of the Series H Preferred, assuming that it was convertible, is one share
of Series H Preferred convertible into 10 shares of Common Stock. As of
September 11, 2003, the shares of Series H Preferred outstanding would be
convertible into 5,000,000 shares of Common Stock, representing approximately
12.72% of the Company's outstanding Common Stock on a fully diluted basis. This
conversion ratio takes into account the one-for-five reverse stock split of our
Common Stock effected on April 25, 2002.

  Listing and Transfer Agent

   Our Series H Preferred is not listed. Velocity Express acts as the transfer
agent and registrar for the Series H Preferred.

Stock Options and Warrants

   We currently sponsor the 1995 Stock Option Plan, the 2000 Stock Option Plan
and the 1996 Director Stock Option Plan. These plans provide for the issuance
of up to 2,310,000 shares. Options may be granted to

                                      39

<PAGE>

employees, directors and consultants. With the exception of the 2000 Stock
Option Plan, option prices are not less than the fair market value of our
common stock on the date of grant. In the case of the 2000 Stock Option Plan,
non-statutory options may be granted at not less than 85% of the fair market
value of our common stock on the date of grant. The majority of the options
vest annually in equal amounts over a three-year period. The 2000 Stock Option
Plan also allows for the issuance of performance shares or restricted stock. As
of September 11, 2003, we have 42,500 shares of restricted stock outstanding.

   The Company issues warrants to purchase our Common Stock from time to time
as payments for services rendered to the Company or in connection with equity
issuances. The following is information related to the outstanding warrants to
purchase our Common Stock as of September 11, 2003:

<TABLE>
<CAPTION>
                       Common Stock Warrants Outstanding
                       ---------------------------------
        Range of               Weighted-Average Remaining  Weighted-Average
     Exercise Prices  Number   Contractual Life (in years)  Exercise Price
     --------------- --------- --------------------------- ----------------
     <S>             <C>       <C>                         <C>
     $ 0.01 -  0.05  6,275,157            4.46                  $ 0.01
     $ 1.87 -  3.60    688,206            2.69                  $ 2.90
     $ 4.25 - 10.00    912,654            5.05                  $ 7.14
     $10.75 - 21.25     39,484            1.00                  $17.03
     $31.88 - 64.63     19,488            2.51                  $51.01
                     ---------
        Total:       7,934,989            4.36                  $ 1.29
                     =========
</TABLE>

   In connection with the Series H Preferred issued in fiscal 2003, we issued a
total of 6.3 million warrants to purchase our Common Stock with an exercise
price of $0.01 per share and a term of five years. Warrants to purchase 2.5
million shares of our Common Stock were issued at the time the Series H
Preferred was sold. The proceeds from the Series H Preferred were allocated
based upon their relative fair values between the warrants and the Series H
Preferred resulting in an allocation of $1.5 million from Series H Preferred to
additional paid in capital that was recognized in the second and third quarters
of fiscal 2003. Additionally, on May 1, 2003 we issued 3.8 million warrants to
the holders of the Series H Preferred. The fair value of these warrants
amounted to $2.5 million and will be accounted for in the fourth quarter of
fiscal 2003 as a deemed dividend to the preferred shareholders which will
increase the accumulated deficit and additional paid in capital. The warrants
were priced at fair market value on the date of grant based on the closing
price of the Company's common stock as quoted on the Nasdaq system.

                                      40

<PAGE>

                      DESCRIPTION OF CERTAIN INDEBTEDNESS

Revolving Credit Facility

   We intend to continue to fund operations through the extension of existing
revolving credit and senior subordinated debt facilities. The revolving credit
facility with Fleet Capital Corporation, allows for borrowings under the
revolving note limited to the lesser of $40 million or an amount based on a
defined portion of receivables. Interest for the first year is payable monthly
at a rate of prime plus 1.25% (5.5% at March 29, 2003). We may elect the rate
of LIBOR plus 3% at our discretion in which case interest is payable at the end
of a LIBOR advance period. As of March 29, 2003, we have 88% of this facility
under LIBOR contracts at interest rates ranging from 4.375% to 4.5%. In
addition, we are required to pay a commitment fee of 0.375% on unused amounts
of the total commitment, as defined in the agreement. The term of the facility
is two years, ending January 2004. Our accounts receivable have been pledged to
secure borrowings under the revolving note. We are subject to certain
restrictive covenants, the more significant of which include limitations on
dividends, acquisitions, new indebtedness in excess of $0.5 million and changes
in capital structure. We are also required to maintain financial covenants
related to capital expenditures and maintaining of minimum availability levels.

   We also have a senior subordinated note which has interest payable quarterly
at 12% per annum and is due September 30, 2004. The note is subordinate to the
revolving note. The initial carrying value of the senior subordinated note was
reduced by $1.7 million for the fair value of the common stock warrant issued
to the senior subordinated lender. The unamortized discount was $0.5 million at
March 29, 2003, and is being amortized over the remaining three-year life of
the note. The accompanying warrant to the senior subordinated lender has an
exercise price of $7.44 per share and entitles the holder to acquire, in whole
or in part 608,099 shares of our Common Stock, as adjusted to reflect certain
anti-dilution rights as defined in the warrant purchase agreement.

                                      41

<PAGE>

                             PLAN OF DISTRIBUTION

   We are offering shares of our Series I Preferred directly to you pursuant to
this rights offering. We have not employed any brokers, dealers or underwriters
in connection with the solicitation for exercise of subscription rights in this
rights offering and no commissions, fees or discounts will be paid in
connection with it. We may contact holders of Common Stock and Preferred Stock
by mail, telephone, facsimile and personal interview and may request brokers,
dealers and other nominee stockholders to forward material relating to the
offers to beneficial owners of Common Stock or Preferred Stock. Our officers
and other employees will not receive any commissions or compensation in
connection with these activities other than their normal employment
compensation. We will pay out-of pocket expenses, including payments to legal
advisors, accountants and subscription agents, printing costs and mailing costs
estimated to total approximately $110,000.

            CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

   The following is a summary of certain U.S. federal income tax consequences
to holders of our Common Stock and Preferred Stock for the receipt of the
subscription rights in this rights offering and the ownership of shares of
Series I Preferred upon exercise of those subscription rights. This discussion
is based upon the Internal Revenue Code of 1986, as amended (the "Code"),
Treasury regulations promulgated thereunder, administrative pronouncements and
judicial decisions as of the date hereof, all of which are subject to change or
differing interpretations at any time, possibly with retroactive effect. We
have not sought and do not intend to seek a ruling from the Internal Revenue
Service ("IRS") or a formal opinion from counsel with respect to any of the tax
consequences discussed below, and there is no assurance that the IRS will agree
with our conclusions.

   This summary is limited to beneficial owners of our Common Stock and
Preferred Stock who are United States persons for U.S. federal income tax
purposes and who hold our Common Stock and Preferred Stock as capital assets
within the meaning of Section 1221 of the Code (generally, property held for
investment). It does not address all aspects of U.S. federal income taxation
that may be applicable to you in light of your particular circumstances and
does not address special classes of taxpayers that may be subject to special
treatment under the Code (such as foreign persons, dealers in securities,
financial institutions, partnerships and other pass-through entities, life
insurance companies, tax-exempt organizations, persons holding our stock or
subscription rights as part of a hedge, constructive sale, wash sale, straddle,
or conversion transaction or persons whose functional currency is not the U.S.
dollar). In addition, this summary does not address the effect of any state,
local or foreign tax laws or the application of U.S. federal estate and gift
tax or the alternative minimum tax.

   YOU SHOULD CONSULT YOUR OWN TAX ADVISORS AS TO THE SPECIFIC TAX CONSEQUENCES
TO YOU OF THE RIGHTS OFFERING, INCLUDING THE APPLICATION OF FEDERAL, STATE,
LOCAL AND FOREIGN INCOME AND OTHER TAX LAWS BASED ON YOUR PARTICULAR FACTS AND
CIRCUMSTANCES.

Subscription Rights

  Holders of Common Stock

   Receipt

   Based on relevant Treasury regulations, we believe that you should not be
treated as receiving a taxable distribution on your Common Stock upon the
receipt of subscription rights in the offering. However, the IRS may not agree
with our position, in which case you would be treated as receiving a
distribution which may be taxable on your Common Stock upon the receipt of
subscription rights in the offering as described below under "Holders of
Preferred Stock--Receipt." The remainder of this discussion assumes that you
will not recognize taxable income upon the receipt of subscription rights in
the offering.

   Tax Basis and Holding Period

   If, on the distribution date, the fair market value of the subscription
rights you receive is less than 15% of the fair market value of the Common
Stock with respect to which the rights are distributed, your tax basis in the
subscription rights generally will be zero. However, you may irrevocably elect,
in your U.S. federal income tax

                                      42

<PAGE>

return for the year in which the subscription rights are received, to allocate
your tax basis in the Common Stock between the Common Stock and the
subscription rights in proportion to their relative fair market values on the
distribution date. If, on the distribution date, the fair market value of the
subscription rights you receive is greater than 15% of the fair market value of
the Common Stock with respect to which the rights are distributed, you will be
required to allocate your tax basis in the Common Stock between the Common
Stock and the subscription rights in proportion to their relative fair market
values on the distribution date. Your holding period for the subscription
rights will include the holding period of the Common Stock with respect to
which the rights are distributed.

   Expiration

   If your subscription rights lapse without being exercised, you will not
recognize any gain or loss, and the tax basis of the Common Stock with respect
to which such subscription rights were distributed will be equal to the tax
basis in such Common Stock immediately before the receipt of the subscription
rights in the rights offering.

   Exercise; Tax Basis in and Holding Period of Series I Preferred

   You will not recognize any gain or loss upon the exercise of subscription
rights received in the rights offering. Your tax basis in the shares of Series
I Preferred acquired upon exercise of the subscription rights will equal the
tax basis, if any, in the subscription rights plus the subscription price. Your
holding period for the shares of Series I Preferred will begin on the exercise
date. See "Series I Preferred" below for a discussion of additional U.S.
federal income tax consequences of the ownership and disposition of shares of
Series I Preferred.

  Holders of Preferred Stock

   Receipt

   You should be treated as receiving a distribution with respect to your
Preferred Stock in an amount equal to the fair market value of the subscription
rights (generally, value in excess of the subscription price), which should not
result in any current dividend income to you because we do not believe that we
have or will have any current or accumulated earnings and profits, as computed
for federal income tax purposes, this year. The amount of the distribution
should be applied to reduce, but not below zero, your tax basis in the
Preferred Stock with respect to which the subscription rights are distributed,
and any excess generally should be taxable as capital gain to you (long-term
capital gain if you held your Preferred Stock for more than one year).

   Tax Basis and Holding Period

   Your tax basis in your subscription rights will equal their fair market
value on the distribution date (generally, the value in excess of the
subscription price). Your holding period for the subscription rights will begin
on the date of the distribution.

   Expiration

   If your subscription rights lapse without being exercised, you will
recognize a short-term capital loss equal to your tax basis in such expired
subscription rights. The ability of individuals to offset capital losses is
limited.

   Exercise; Tax Basis in and Holding Period of Series I Preferred

   See discussion above under "--Holders of Common Stock--Exercise; Tax Basis
in and Holding Period of Series I Preferred."

Series I Preferred

  Cash Distributions

   Cash distributions with respect to the Series I Preferred generally will be
taxed as dividend income to the extent of your ratable share of our current and
accumulated earnings and profits. Cash distributions in excess of our earnings
and profits will be applied to reduce, but not below zero, your tax basis in
the Series I Preferred, and any excess generally will be taxable as capital
gain to you (long-term if you held your Series I Preferred for more

                                      43

<PAGE>

than one year at the time of the distribution). Under current law, the maximum
tax rate on most dividends received by individuals before January 1, 2009 is
15%. The maximum tax rate on net long-term capital gain recognized by
individuals before January 1, 2009 is 15% under current law, and the ability of
individuals to offset capital losses is limited.

  Adjustments

   In general, anti-dilution adjustments do not result in constructive
distributions. However, in certain circumstances, an adjustment to the
conversion ratio of the Series I Preferred, or the failure to make such an
adjustment, may result in constructive distributions taxable as dividends. In
such event, your tax basis in the Series I Preferred would be increased by the
amount of any such dividend.

  Conversion

   You will not recognize gain or loss upon the conversion of shares of Series
I Preferred into shares of our Common Stock (except to the extent of cash, if
any, received in lieu of fractional shares of Common Stock). Your tax basis in
the shares of Common Stock will equal your tax basis in the shares of Series I
Preferred exchanged therefor, and your holding period with respect to the
shares of Common Stock will include your holding period for the shares of
Series I Preferred exchanged therefor. The receipt of cash (if any) in lieu of
a fractional interest in a share of Common Stock will be taxed as if the
fractional share of Common Stock had been issued and then redeemed for cash.
Accordingly, you should generally recognize gain or loss in an amount equal to
the difference between the amount of cash received for the fractional interest
and your tax basis in the fractional interest.

  Disposition

   The sale or other taxable disposition of shares of Series I Preferred will
result in capital gain or loss equal to the difference between the amount
realized in the disposition and your tax basis in the Series I Preferred
immediately before the disposition. Such capital gain or loss will be long-term
if you held the Series I Preferred for more than one year.

  Redemption

   Under Section 302 of the Code, a redemption of Series I Preferred generally
will be treated as a sale or exchange if such redemption completely terminates
your entire actual and constructive stock interest in our equity or is "not
essentially equivalent to a dividend" with respect to you. In determining
whether either of these two tests is met, you must take into account the shares
of stock actually owned by you as well as the shares of stock constructively
owned by you under the constructive ownership rules of section 318 of the Code.
Under these constructive ownership rules, you will be deemed to own any shares
of our capital stock that are owned, actually and in some cases constructively,
by certain related individuals or entities and any shares of our capital stock
that you have a right to acquire by exercise of an option or by conversion or
exchange of a security.

   A redemption of shares of your Series I Preferred will be treated as "not
essentially equivalent to a dividend" if you experience a "meaningful
reduction" in your percentage interest in our equity as a result of the
redemption. Depending on your particular circumstances, taking into account
whether you are part of management or the Board of Directors of the Company,
even a small reduction in your stock ownership interest in us may satisfy this
test.

   If the redemption is treated as a sale or exchange, you will recognize
capital gain or loss equal to the difference between the amount received in the
redemption and your tax basis in the Series I Preferred immediately before the
redemption. Such capital gain or loss will be long-term if you have held the
Series I Preferred for more than one year. If the redemption does not
constitute a sale or exchange, the receipt of cash will be treated as a
distribution with respect to the Series I Preferred subject to the rules
described above under "--Cash Distributions."

                                      44

<PAGE>

                                 LEGAL MATTERS

   The validity of the subscription rights, the shares of Series I Preferred
and the Common Stock issuable upon conversion of the Series I Preferred offered
pursuant to this rights offering under this prospectus will be passed upon for
us by our General Counsel, Wesley C. Fredenburg.

                                    EXPERTS

   Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements and schedule included in our Annual report on Form
10-K/A-2 for the year ended June 29, 2002, as set forth in their report, which
is incorporated by reference in this prospectus and elsewhere in the
registration statement. Our financial statements and schedule are incorporated
by reference in reliance on Ernst & Young LLP's report, given on their
authority as experts in accounting and auditing.

                      WHERE YOU CAN FIND MORE INFORMATION

   We file annual, quarterly and current reports, proxy statements other
information with the Securities and Exchange Commission, or the SEC. You may
read or copy any document we file at the public reference room maintained by
the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. Copies of this
information may also be obtained by mail from the SEC's Public Reference Branch
at 450 Fifth Street, N.W., Washington, D.C. 20549. In addition, our filings
with the SEC are also available to the public on the SEC's internet Web site at
www.sec.gov.

   We have filed with the SEC a registration statement on Form S-3 under the
Securities Act of 1933 with respect to this rights offering. This prospectus
does not contain all of the information set forth in the registration statement
and its exhibits. Statements made by us in this prospectus as to the contents
of any contract, agreement or other document referred to in this prospectus are
not necessarily complete. For a more complete description of these contracts,
agreements or other documents, you should carefully read the exhibits to the
registration statement and the documents which we reference under the caption
"Incorporation of Certain Documents by Reference."

   The registration statement, together with its exhibits and schedules, which
we filed with the SEC, may also be reviewed and copied at the public reference
facilities of the SEC located at the addresses set forth above. Please call the
SEC at 1-800-SEC-0330 for further information on its public reference
facilities.

   This prospectus is part of a registration statement we filed with the SEC.
You should rely only on the information contained, or incorporated by reference
in, this prospectus. We have not authorized anyone to provide information
different from that contained in, or incorporated by reference in, this
prospectus. This prospectus is not an offer to sell or a solicitation of an
offer to buy these securities in any state where the offer or sale is not
permitted. This prospectus is not an offer to sell or a solicitation of an
offer to buy these securities in any circumstance under which the offer or
solicitation is not permitted. The information contained in this prospectus is
correct only as of the date of this prospectus, regardless of the time of the
delivery of this prospectus or any sale of these securities.

                                      45

<PAGE>

                          FORWARD-LOOKING STATEMENTS

   This prospectus includes forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These forward-looking
statements are identified by terms and phrases such as "anticipate," "believe,"
"intend," "estimate," "expect," "continue," "should," "could," "may," "plan,"
"project," "predict," "will" and similar expressions and include references to
assumptions and relate to our future prospects, developments and business
strategies.

   Factors that could cause our actual results to differ materially from those
expressed or implied in such forward-looking statements include, but are not
limited to:

  .  we have sustained losses applicable to holders of our Common Stock in the
     past and we may continue to sustain losses applicable to holders of our
     Common Stock in the future;

  .  we may not be successful in implementing our growth plans;

  .  we may need additional capital to finance our growth and working capital
     needs;

  .  we have substantial indebtedness;

  .  our revolving credit facility matures on January 28, 2004;

  .  our debt instruments contain significant financial and operational
     requirements;

  .  our ability to comply with the financial covenants in our credit
     agreements will be affected by our financial performance as well as events
     beyond our control, including prevailing economic, financial and industry
     conditions;

  .  rapid technological changes in communications technology may require
     substantial expenditures by us;

  .  we face significant risks of tax authorities classifying independent
     contractors as our employees;

  .  we could be subject to claims for personal injury, death and property
     damage;

  .  we could be subject to claims for non-delivery or delayed delivery of
     packages;

  .  we face many risks unique to the package shipping and same-day delivery
     industries;

  .  we must comply with various governmental regulations;

  .  we face intense competition in the market for same-day delivery services;

  .  we depend on our key personnel;

  .  the loss of significant customers could adversely affect our business;

  .  our stock may be delisted from Nasdaq because we may not meet the minimum
     bid price and market capitalization requirements for continued listing;

  .  we have a substantial investment in equipment and technology; and

  .  terrorist attacks and threats or actual war may negatively impact all
     aspects of our operations.

   We undertake no obligation to revise the forward-looking statements included
in this prospectus to reflect any future events or circumstances. Our actual
results, performance or achievements could differ materially from the results
expressed in, or implied by, these forward-looking statements. Factors that
could cause or contribute to such differences are discussed in this prospectus
under the caption "Risk Factors" as well as elsewhere in this prospectus and
Velocity Express' other filings with the SEC. See "Where You Can Find More
Information."

                                      46

<PAGE>

                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

   The SEC, allows us to "incorporate by reference" information that we file
with them, which means that we can disclose important information to you by
referring you to those documents. Specifically, we are incorporating by
reference the following documents listed below and any future filings that we
will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934, as amended, until the completion of the
offering:

  .  Annual Report on Form 10-K for the fiscal year ended June 29, 2002, as
     amended by our Form 10-K/A filed on October 8, 2002 and our Form 10-K/A
     filed on July 28, 2003.

  .  Quarterly Report on Form 10-Q for the period ended September 28, 2002, as
     amended by our Form 10-Q/A filed on July 28, 2003;

  .  Quarterly Report on Form 10-Q for the period ended December 28, 2002, as
     amended by our Form 10-Q/A filed on July 28, 2003;

  .  Quarterly Report on Form 10-Q for the period ended March 29, 2003; and

  .  Current Reports on Form 8-K filed on January 24, 2003 and May 14, 2003.

   You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:

                              Corporate Secretary
                         Velocity Express Corporation
                         7803 Glenroy Road, Suite 200
                         Minneapolis, Minnesota 55439
                                (612) 492-2400

   Any statement contained in this prospectus or in a document, all or a
portion of which is incorporated or deemed to be incorporated by reference in
this prospectus, shall be deemed to be modified or superseded for purposes of
this prospectus to the extent that a statement contained in this prospectus or
in any other subsequently filed document that also is deemed to be incorporated
by reference in this prospectus modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this prospectus.

                                      47

<PAGE>

                                   PART II.

                    INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution

   The following table sets forth the estimated expenses to be incurred in
connection with the issuance and distribution of the securities being
registered, other than underwriting discounts and commissions, to be paid by
the Registrant.

<TABLE>
               <S>                                      <C>
               SEC Registration Fee.................... $  1,497
               Printing and Engraving Fees and Expenses   15,000
               Accounting Fees and Expenses............   25,000
               Legal Fees and Expenses.................   50,000
               Blue Sky Filing Fees....................   15,000
               Miscellaneous...........................    3,503
                                                        --------
               Total................................... $110,000
                                                        ========
</TABLE>

   All fees and expenses other than the SEC registration fee are estimated. The
expenses listed above will be paid by the Company.

Item 15. Indemnification of Officers and Directors

   Section 145 of the General Corporation Law of the State of Delaware, or
DGCL, empowers a Delaware corporation to indemnify any persons who are, or are
threatened to be made, parties to any threatened, pending or completed legal
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of such corporation), by
reason of the fact that such person was an officer or director of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation or enterprise. The
indemnity may include expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by such person
in connection with such action, suit or proceeding, provided that such officer
or director acted in good faith and in a manner he or she reasonably believed
to be in or not opposed to the corporation's best interests, and, for criminal
proceedings, had no reasonable cause to believe his or her conduct was illegal.
A Delaware corporation may indemnify officers and directors against expenses
(including attorneys' fees) in connection with the defense or settlement of an
action by or in the right of the corporation under the same conditions, except
that no indemnification is permitted without judicial approval if the officer
or director is adjudged to be liable to the corporation. Where an officer or
director is successful on the merits or otherwise in the defense of any action
referred to above, the corporation must indemnify him or her against the
expenses which such officer or director actually and reasonably incurred.

   Article Five of the by-laws of Velocity Express provides that Velocity
Express may indemnify and hold harmless, to the fullest extent authorized by
the DGCL, any person who is, or is threatened to be made, a party to any
action, suit or proceeding, whether civil, criminal, administrative or
investigative by reason of the fact that he or she is or was a director or an
officer of Velocity Express or is or was serving at the request of Velocity
Express as a director, officer, employee or agent of any other corporation or
entity, whether the basis of such proceeding is alleged action in an official
capacity as a director, officer, employee or agent or in any other capacity
while serving as a director, officer, employee or agent, against all expense,
liability and loss reasonably incurred by such indemnitee in connection with
those proceedings. This right to indemnification includes the right to have
Velocity Express advance the funds to cover expenses (including attorneys'
fees) incurred in defending any of those proceeding in advance of its final
disposition; provided, however, that, if required by the DGCL, this expense
advancement shall be made only upon delivery to Velocity Express of an
undertaking by or on behalf of that indemnitee to repay all amounts so advanced
if it shall ultimately be determined by final judicial decision from which
there is no further right to appeal that such indemnitee is not entitled to be
indemnified for such expenses. If a claim for indemnification under Velocity
Express' by-laws is not paid in full by the Company within thirty (30) days
after a written claim has been received by the Company, except in the case of a
claim for an advancement of expenses, in which case the applicable period shall
be twenty (20) days, the indemnitee may

                                     II-1

<PAGE>

at any time thereafter bring suit against the Company to recover the unpaid
amount of the claim. In any suit brought by the indemnitee to enforce a right
to indemnification or to an advancement of expenses hereunder, or brought by
Velocity Express to recover an advancement of expenses pursuant to the terms of
an undertaking, the burden of proving that the indemnitee is not entitled to be
indemnified, or to such advancement of expenses shall be on the Corporation.

   Article Nine of the certificate of incorporation of Velocity Express limits
the personal liability of the directors of Velocity Express for violations of
their fiduciary duty. This provision eliminates each director's liability to
Velocity Express or its stockholders for monetary damages except (i) for any
breach of the director's duty of loyalty to Velocity Express or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the DGCL providing for liability of directors for unlawful payment of
dividends or unlawful stock purchases or redemptions, or (iv) for any
transaction from which a director derived an improper personal benefit. The
effect of this provision is to eliminate the personal liability of directors
for monetary damages for actions involving a breach of their fiduciary duty of
care, including any such actions involving gross negligence.

   The Company maintains a directors and officers insurance policy.

Item 16. List of Exhibits

   The following is a list of all exhibits filed as a part of this registration
statement on Form S-3, including those incorporated in this registration
statement by reference.

<TABLE>
<CAPTION>
Exhibit
Number                                    Description of Exhibit
------                                    ----------------------
<C>     <S>

  4.1   Certificate of Designation of Series I Convertible Preferred Stock*

  4.2   Form of Subscription Rights Certificate*

  4.3   Form of Series I Convertible Preferred Stock Certificate*

  5.1   Opinion of Wesley C. Fredenburg regarding the legality of the securities being registered*

 12.1   Statement regarding Computation of Ratios*

 23.1   Consent of Ernst & Young LLP, Independent Auditors*

 24.1   Powers of Attorney*

 99.1   Form of Instructions for Use of Velocity Express Subscription Rights Certificates*

 99.2   Form of Notice of Guaranteed Delivery*

 99.3   Form of Letter to Stockholders Who are Recordholders*

 99.4   Form of Letter to Stockholders Who are Not Beneficial Owners*

 99.5   Form of Letter to Clients of Stockholders Who are Not Beneficial Owners*

 99.6   Form of Nominee Holder Certification*

 99.7   Form of Beneficial Owner Election Form*
</TABLE>
--------
* Filed herewith

                                     II-2

<PAGE>

Item 17. Undertakings

   The undersigned registrant hereby undertakes:

      (1) To file, during any period in which offers or sales are being made, a
   post-effective amendment to this registration statement:

          (i) To include any prospectus required by section 10(a)(3) of the
       Securities Act of 1933;

          (ii) To reflect in the prospectus any facts or events arising after
       the effective date of the registration statement (or the most recent
       post-effective amendment thereof) which, individually or in the
       aggregate, represent a fundamental change to such information in the
       registration statement. Notwithstanding the foregoing, any increase or
       decrease in volume of securities offered (if the total dollar value of
       securities offered would not exceed that which was registered) and any
       deviation from the low or high end of the estimated maximum offering
       range may be reflected in the form of prospectus filed with the
       Commission pursuant to Rule 424(b) under the Securities Act if, in the
       aggregate, the changes in volume and price represent no more than a 20%
       change in the maximum aggregate offering price set forth in the
       "Calculation of Registration Fee" table in the effective registration
       statement; and

          (iii) To include any material information with respect to the plan of
       distribution not previously disclosed in the registration statement or
       any material change in the information set forth in the registration
       statement;

   provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
   registration statement is on Form S-3 or Form S-8, and the information
   required to be included in a post-effective amendment by those paragraphs is
   contained in periodic reports filed by the registrant pursuant to section 13
   or section 15(d) of the Securities Exchange Act of 1934 that are
   incorporated by reference in the registration statement.

      (2) That, for the purpose of determining any liability under the
   Securities Act of 1933, each such post-effective amendment shall be deemed
   to be a new registration statement relating to the securities offered
   therein, and the offering of such securities at that time shall be deemed to
   be the initial bona fide offering thereof.

      (3) To remove from registration by means of a post-effective amendment
   any of the securities being registered which remain unsold at the
   termination of the offering.

      The undersigned registrant hereby undertakes that, for purposes of
   determining any liability under the Securities Act of 1933, each filing of
   the registrant's annual report pursuant to Section 13(a) or 15(d) of the
   Securities Exchange Act of 1934 that is incorporated by reference in the
   registration statement shall be deemed to be a new registration statement
   relating to the securities offered therein, and the offering of such
   securities at that time shall be deemed to be the initial bona fide offering
   thereof.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers, and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against liabilities (other than the payment by the registrant
of expenses incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.


                                     II-3

<PAGE>

                                  SIGNATURES

   Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Bloomington, State of Minnesota, on September 30,
2003.

                                              VELOCITY EXPRESS CORPORATION

                                              By:     /S/  VINCENT A. WASIK
                                                  -----------------------------
                                                        Vincent A. Wasik
                                                     Chairman of the Board,
                                                        President and CEO

   Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.

<TABLE>
<CAPTION>
            Name                           Title                     Date
            ----                           -----                     ----
<S>                            <C>                            <C>

    /S/  VINCENT A. WASIK      Chairman of the Board,         September 30, 2003
-----------------------------  President and   CEO
      Vincent A. Wasik         (Principal Executive Officer)

      /S/  MARK E. TIES        Chief Financial Officer        September 30, 2003
-----------------------------  (Principal   Financial and
        Mark E. Ties           Accounting Officer)

     /S/  JAMES G. BROWN       Director                       September 30, 2003
-----------------------------
       James G. Brown

     /S/  DOUGLAS HSIEH        Director                       September 30, 2003
-----------------------------
        Douglas Hsieh

      /S/  ALEX PALUCH         Director                       September 30, 2003
-----------------------------
         Alex Paluch

       /S/  JACK KEMP          Director                       September 30, 2003
-----------------------------
          Jack Kemp

   /S/  RICHARD A. KASSAR      Director                       September 30, 2003
-----------------------------
      Richard A. Kassar

    /S/  LESLIE E. GRODD       Director                       September 30, 2003
-----------------------------
       Leslie E. Grodd
</TABLE>

                                     II-4

<PAGE>

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit
Number                                    Description of Exhibit
------                                    ----------------------
<C>     <S>

  4.1   Certificate of Designation of Series I Convertible Preferred Stock*

  4.2   Form of Subscription Rights Certificate*

  4.3   Form of Series I Convertible Preferred Stock Certificate*

  5.1   Opinion of Wesley C. Fredenburg regarding the legality of the securities being registered*

 12.1   Statement regarding Computation of Ratios*

 23.1   Consent of Ernst & Young LLP, Independent Auditors*

 24.1   Powers of Attorney*

 99.1   Form of Instructions for Use of Velocity Express Subscription Rights Certificates*

 99.2   Form of Notice of Guaranteed Delivery*

 99.3   Form of Letter to Stockholders Who are Recordholders*

 99.4   Form of Letter to Stockholders Who are Not Beneficial Owners*

 99.5   Form of Letter to Clients of Stockholders Who are Not Beneficial Owners*

 99.6   Form of Nominee Holder Certification*

 99.7   Form of Beneficial Owner Election Form*
</TABLE>
--------
* Filed herewith.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>3
<FILENAME>dex41.txt
<DESCRIPTION>CERTIFICATE OF DESIGNATION OF SERIES I CONVERTIBLE PREFERRED STOCK
<TEXT>
<PAGE>

                                                                     EXHIBIT 4.1

                          VELOCITY EXPRESS CORPORATION
             CERTIFICATE OF DESIGNATION OF PREFERENCES AND RIGHTS OF
                      SERIES I CONVERTIBLE PREFERRED STOCK

<PAGE>

        Section 1. Designation and Amount. The number of authorized shares of
Series I Convertible Preferred Stock, par value $0.004 per share (the "Series I
Preferred Stock"), shall be 8,409,091.

        Section 2. Dividends. In the event that the Corporation declares or pays
any dividends upon the Common Stock (whether payable in cash, securities or
other property) other than dividends payable solely in shares of Common Stock,
the Corporation shall also declare and pay to the holders of Series I Preferred
Stock at the same time that it declares and pays such dividends to the holders
of the Common Stock, the dividends which would have been declared and paid with
respect to the Common Stock issuable upon conversion of shares of the Series I
Preferred Stock which are convertible into shares of Common Stock had all such
shares of the outstanding Series I Preferred Stock been converted immediately
prior to the record date for such dividend, or if no record date is fixed, the
date as of which the record holders of Common Stock entitled to such dividends
are to be determined.

        Section 3. Liquidation Preference. Upon liquidation, dissolution and
winding up of the Corporation (whether voluntary or involuntary) (a "Liquidation
Event"), the Corporation shall pay to the holders of the Series I Preferred
Stock (unless otherwise provided for in the resolution or resolutions creating
such stock) the aggregate Liquidation Value attributable to such shares (each, a
"Share") plus any unpaid dividends thereon. If upon any such Liquidation Event,
the Corporation's assets to be distributed among the holders of the Junior
Securities, Series B Preferred Stock, Series C Preferred Stock, Series D
Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series H
Preferred Stock and Series I Preferred Stock are insufficient to permit payment
to such holders of the aggregate amount which they are entitled to be paid under
this Section 3 or Article IV, Section 3 of the Corporation's Amended and
Restated Certificate of Incorporation, as amended from time to time (the
"Charter"), as applicable, then the entire assets available to be distributed to
the Corporation's stockholders shall be distributed in accordance with the
priorities set forth in Article IV, Section 3 of the Charter, with the Series I
Preferred Stock ranking parri passu with the Series D, F, G and H Preferred
Stock and prior to the Series B and C Preferred Stock. Not less than sixty (60)
days prior to the payment date of the Liquidation Value, the Corporation shall
mail written notice of any such Liquidation Event to each record holder of
Series I Preferred Stock, setting forth in reasonable detail the amount of
proceeds to be paid with respect to each Share and each share of Common Stock in
connection with such Liquidation Event. A change of control of the Corporation
shall not be deemed a Liquidation Event for purposes of this Section 3.

        Section 4. Voting Rights.

        4A.     Voting Rights. Subject to the terms of this Section 4, the
holders of the Series I Preferred Stock shall be entitled to notice of all
stockholders meetings in accordance with the Corporation's Bylaws, and except as
otherwise required by applicable law, the holders of the

<PAGE>

Series I Preferred Stock shall be entitled to vote on all matters submitted to
the stockholders for a vote together with the holders of the Common Stock, and
all other classes of capital stock entitled to vote with the Common Stock,
voting together as a single class with each share of and Series I Preferred
Stock entitled to one vote for each share of Common Stock issuable upon
conversion of the such Series I Preferred Stock as of the record date for such
vote or, if no record date is specified, as of the date of such vote.
Notwithstanding the above, the Series I Preferred Stock shall have no voting
rights to the extent that its holder, together with the holder's Affiliates,
have voting power in excess of 40% of all of the Corporation's outstanding
capital stock.

        4B.     Covenants.

        The Corporation shall not take any of the actions set forth below
without first obtaining the affirmative vote of the holders of at least
two-thirds of the then outstanding shares of Series I Preferred Stock for so
long as at least 20% of the Series I Preferred Stock originally issued pursuant
to the Rights Offering remains outstanding:

                (a) alter or change the preferences, rights or powers of the
        Series I Preferred Stock;

                (b) increase or decrease the authorized number of shares of the
        Series I Preferred Stock;

        Section 5. Conversion. Subject to the terms of this Section 5, at any
time and from time to time, any holder of Series I Preferred Stock may convert
all or any portion of the Series I Preferred Stock (including any fraction of a
Share) held by such holder into a number of shares of Conversion Stock computed
by multiplying the number of Shares to be converted by $2.20 and dividing the
result by the Conversion Price then in effect; provided, however, that, except
for Organic Changes (as defined below) to which the following limitation does
not apply, the Series I Preferred Stock shall not be convertible into Conversion
Stock to the extent that such conversion would result in the holder of the
Series I Preferred, together with such holder's Affiliates, holding 40% or more
of all of the outstanding capital stock of the Corporation on an as converted
basis.

        5A.     Conversion Procedure.

                (i)     Except as otherwise provided herein, each conversion of
        Preferred Stock shall be deemed to have been effected as of the close of
        business on the date on which the certificate or certificates
        representing the Series I Preferred Stock to be converted have been
        surrendered for conversion at the principal office of the Corporation.
        At the time any such conversion has been effected, the rights of the
        holder of the Shares converted as a holder of Series I Preferred Stock
        shall cease and the Person or Persons in whose name or names any
        certificate or certificates for shares of Conversion Stock are to be
        issued upon such conversion shall be deemed to have become the holder or
        holders of record of the shares of Conversion Stock represented thereby.

                (ii)    Notwithstanding any other provision hereof, if a
        conversion of Preferred Stock is to be made in connection with a
        transaction affecting the Corporation, the

                                        2

<PAGE>

        conversion of any shares of Series I Preferred Stock may, at the
        election of the holder thereof, be conditioned upon the consummation of
        such transaction, in which case such conversion shall not be deemed to
        be effective until such transaction has been consummated.

                (iii)   As soon as possible after a conversion has been effected
        (but in any event within three (3) Business Days in the case of
        subparagraph (A) below), the Corporation shall deliver to the converting
        holder:

                        (A)     a certificate or certificates representing the
                number of shares of Conversion Stock issuable by reason of such
                conversion in such name or names and such denomination or
                denominations as the converting holder has specified;

                        (B)     payment of any amount payable under subparagraph
                (viii) below with respect to such conversion; and

                        (C)     a certificate representing any Shares, which
                were represented, by the certificate or certificates delivered
                to the Corporation in connection with such conversion but which
                were not converted.

                (iv)    The issuance of certificates representing shares of
        Conversion Stock upon conversion of Preferred Stock shall be made
        without charge to the holders of such Preferred Stock for any issuance
        tax in respect thereof or other cost incurred by the Corporation in
        connection with such conversion and the related issuance of shares of
        Conversion Stock. Upon conversion of each share of Series I Preferred
        Stock, the Corporation shall take all such actions as are necessary in
        order to insure that the Conversion Stock issuable with respect to such
        conversion shall be validly issued, fully paid and nonassessable, free
        and clear of all taxes, liens, charges and encumbrances with respect to
        the issuance thereof.

                (v)     The Corporation shall not close its books against the
        transfer of Preferred Stock or of Conversion Stock issued or issuable
        upon conversion of Series I Preferred Stock in any manner, which
        interferes with the timely conversion of Series I Preferred Stock. The
        Corporation shall assist and cooperate with any holder of Shares
        required to make any governmental filings or obtain any governmental
        approval prior to or in connection with any conversion of Shares
        hereunder (including, without limitation, making any filings required to
        be made by the Corporation).

                (vi)    The Corporation shall at all times reserve and keep
        available out of its authorized but unissued shares of Conversion Stock,
        solely for the purpose of issuance upon the conversion of the Series I
        Preferred Stock, such number of shares of Conversion Stock issuable upon
        the conversion of all outstanding Preferred Stock. All shares of
        Conversion Stock that are so issuable shall, when issued, be duly and
        validly issued, fully paid and nonassessable and free from all taxes,
        liens and charges. The Corporation shall take all such actions as may be
        necessary to assure that all such shares of Conversion Stock may be so
        issued without violation of any applicable law or governmental
        regulation or any requirements of any domestic securities exchange upon
        which shares of

                                        3

<PAGE>

        Conversion Stock may be listed (except for official notice of issuance
        which shall be immediately delivered by the Corporation upon each such
        issuance). The Corporation shall not take any action that would cause
        the number of authorized but unissued shares of Conversion Stock to be
        less than the number of such shares required to be reserved hereunder
        for issuance upon conversion of the Preferred Stock.

                (vii)   If any fractional interest in a share of Conversion
        Stock would, except for the provisions of this subparagraph, be
        delivered upon any conversion of Preferred Stock, the Corporation, in
        lieu of delivering the fractional share therefore, shall pay an amount
        to the holder thereof equal to the Market Price of such fractional
        interest as of the date of conversion.

                (viii)  If the shares of Conversion Stock issuable by reason of
        conversion of Preferred Stock are convertible into or exchangeable for
        any other stock or securities of the Corporation, the Corporation shall,
        at the converting holder's option, upon surrender of the Shares to be
        converted by such holder as provided herein together with any notice,
        statement or payment required to effect such conversion or exchange of
        Conversion Stock, deliver to such holder or as otherwise specified by
        such holder a certificate or certificates representing the stock or
        securities into which the shares of Conversion Stock issuable by reason
        of such conversion are so convertible or exchangeable, registered in
        such name or names and in such denomination or denominations as such
        holder has specified.

        5B.     Conversion Price.

                (i)     In order to prevent dilution of the conversion rights
        granted under this Section 5, the Conversion Price of the Series I
        Preferred Stock shall be subject to adjustment from time to time
        pursuant to this Section 5B.

                (ii)    If and whenever after the original date of issuance of
        the first share of Series I Preferred Stock, the Corporation issues or
        sells, or in accordance with Section 5C is deemed to have issued or
        sold, any shares of its Common Stock for a consideration per share less
        than the Market Price of the Common Stock determined as of the date of
        such issue or sale, then immediately upon such issue or sale, the
        Conversion Price shall be reduced to the Conversion Price determined by
        multiplying the Conversion Price in effect immediately prior to such
        issue or sale by a fraction, the numerator of which shall be the sum of
        (1) the number of shares of Common Stock Deemed Outstanding immediately
        prior to such issue or sale multiplied by the Market Price of the Common
        Stock determined as of the date of such issuance or sale, plus (2) the
        consideration, if any, received by the Corporation upon such issue or
        sale, and the denominator of which shall be the product derived by
        multiplying the Market Price of the Common Stock by the number of shares
        of Common Stock Deemed Outstanding immediately after such issue or sale.

                (iii)   Notwithstanding the foregoing, there shall be no
        adjustment to the Conversion Price hereunder with respect to any
        issuances that are exempt from

                                        4

<PAGE>

        adjustment with respect to any shares of Preferred Stock of any series
        pursuant to Section 5B (iii) of the Charter.

        5C.     Effect on Conversion Price of Certain Events. For purposes of
determining the adjusted Conversion Price under paragraph 5B, the following
shall be applicable:

                (i)     Issuance of Rights or Options. If the Corporation in any
        manner grants or sells any Options and the price per share for which
        Common Stock is issuable upon the exercise of such Options, or upon
        conversion or exchange of any Convertible Securities issuable upon
        exercise of such Options, is less than the Market Price of the Common
        Stock determined as of such time, then the total maximum number of
        shares of Common Stock issuable upon the exercise of such Options or
        upon conversion or exchange of the total maximum amount of such
        Convertible Securities issuable upon the exercise of such Options shall
        be deemed to be outstanding and to have been issued and sold by the
        Corporation at the time of the granting or sale of such Options for such
        price per share. For purposes of this paragraph, the "price per share
        for which Common Stock is issuable" shall be determined by dividing (A)
        the total amount, if any, received or receivable by the Corporation as
        consideration for the granting or sale of such Options, plus the minimum
        aggregate amount of additional consideration payable to the Corporation
        upon exercise of all such Options, plus in the case of such Options
        which relate to Convertible Securities, the minimum aggregate amount of
        additional consideration, if any, payable to the Corporation upon the
        issuance or sale of such Convertible Securities and the conversion or
        exchange thereof, by (B) the total maximum number of shares of Common
        Stock issuable upon the exercise of such Options or upon the conversion
        or exchange of all such Convertible Securities issuable upon the
        exercise of such Options. No further adjustment of the Conversion Price
        shall be made when Convertible Securities are actually issued upon the
        exercise of such Options or when Common Stock is actually issued upon
        the exercise of such Options or the conversion or exchange of such
        Convertible Securities.

                (ii)    Issuance of Convertible Securities. If the Corporation
        in any manner issues or sells any Convertible Securities and the price
        per share for which Common Stock is issuable upon conversion or exchange
        thereof is less than the Market Price of the Common Stock determined as
        of such time, then the maximum number of shares of Common Stock issuable
        upon conversion or exchange of such Convertible Securities shall be
        deemed to be outstanding and to have been issued and sold by the
        Corporation at the time of the issuance or sale of such Convertible
        Securities for such price per share. For the purposes of this paragraph,
        the "price per share for which Common Stock is issuable" shall be
        determined by dividing (A) the total amount received or receivable by
        the Corporation as consideration for the issue or sale of such
        Convertible Securities, plus the minimum aggregate amount of additional
        consideration, if any, payable to the Corporation upon the conversion or
        exchange thereof, by (B) the total maximum number of shares of Common
        Stock issuable upon the conversion or exchange of all such Convertible
        Securities. No further adjustment of the Conversion Price shall be made
        when Common Stock is actually issued upon the conversion or exchange of
        such Convertible Securities, and if any such issue or sale of such
        Convertible Securities is made upon exercise of any Options for which
        adjustments of the Conversion Price had

                                        5

<PAGE>

        been or are to be made pursuant to other provisions of this Section 5,
        no further adjustment of the Conversion Price shall be made by reason of
        such issue or sale.

                (iii)   Change in Option Price or Conversion Rate. If the
        purchase price provided for in any Options, the additional
        consideration, if any, payable upon the conversion or exchange of any
        Convertible Securities or the rate at which any Convertible Securities
        are convertible into or exchangeable for Common Stock changes at any
        time, the Conversion Price in effect at the time of such change shall be
        immediately adjusted to the Conversion Price which would have been in
        effect at such time had such Options or Convertible Securities still
        outstanding provided for such changed purchase price, additional
        consideration or conversion rate, as the case may be, at the time
        initially granted, issued or sold. For purposes of Section 5C, if the
        terms of any Option or Convertible Security which was outstanding as of
        the date of issuance of the Series I Preferred Stock are changed in the
        manner described in the immediately preceding sentence, then such Option
        or Convertible Security and the Common Stock deemed issuable upon
        exercise, conversion or exchange thereof shall be deemed to have been
        issued and sold as of the date of such change; provided, that (A) no
        such change shall at any time cause the Conversion Price hereunder to be
        increased, and (B) no adjustment to the Conversion Price pursuant to
        this clause (iii) shall be made as a result of any adjustment to the
        exercise and/or conversion price with respect to the Bayview Warrant,
        the Common Warrants, the Series D Preferred Stock and Series F Preferred
        Stock only, the Series B Preferred Stock, the Series C Preferred Stock,
        the Series C Warrants, the Preferred Warrants and the exercise of the
        Bridge Warrants, pursuant to and in accordance with the antidilution
        protection provisions of such securities as in effect on the date
        hereof.

                (iv)    Treatment of Expired Options and Unexercised Convertible
        Securities. Upon the expiration of any Option or the termination of any
        right to convert or exchange any Convertible Security without the
        exercise of any such Option or right, the Conversion Price then in
        effect hereunder shall be adjusted immediately to the Conversion Price
        which would have been in effect at the time of such expiration or
        termination had such Option or Convertible Security, to the extent
        outstanding immediately prior to such expiration or termination, never
        been issued. For purposes of Section 5C, the expiration or termination
        of any Option or Convertible Security which was outstanding as of the
        date of issuance of the Preferred Stock with Conversion Price subject to
        adjustment shall not cause the Conversion Price hereunder to be adjusted
        unless, and only to the extent that, a change in the terms of such
        Option or Convertible Security caused it to be deemed to have been
        issued after the date of issuance of the Preferred Stock with Conversion
        Price subject to adjustment.

                (v)     Calculation of Consideration Received. If any Common
        Stock, Option or Convertible Security is issued or sold or deemed to
        have been issued or sold for cash, the consideration received therefore
        shall be deemed to be the amount received by the Corporation therefore.
        If any Common Stock, Option or Convertible Security is issued or sold
        for a consideration other than cash, the amount of the consideration
        other than cash received by the Corporation shall be the fair value of
        such consideration, except where such consideration consists of
        securities, in which case the amount of consideration

                                        6

<PAGE>

        received by the Corporation shall be the Market Price thereof as of the
        date of receipt. The fair value of any consideration other than cash and
        securities shall be determined jointly by the Corporation and the
        holders of at least two-thirds of the Series I Preferred Stock. If such
        parties are unable to reach agreement within a reasonable period of
        time, the fair value of such consideration shall be determined by an
        independent appraiser experienced in valuing such type of consideration
        jointly selected by the Corporation and the holders of at least
        two-thirds of the Series I Preferred Stock, voting as an individual
        class. The determination of such appraiser shall be final and binding
        upon the parties, and the fees and expenses of such appraiser shall be
        borne by the Corporation.

                (vi)    Integrated Transactions. In case any Option is issued in
        connection with the issue or sale of other securities of the
        Corporation, together comprising one integrated transaction in which no
        specific consideration is allocated to such Option by the parties
        thereto, the Option shall be deemed to have been issued for a
        consideration of $.01.

                (vii)   Treasury Shares. The number of shares of Common Stock
        outstanding at any given time shall not include shares owned or held by
        or for the account of the Corporation or any Subsidiary, and the
        disposition of any shares so owned or held shall be considered an issue
        or sale of Common Stock.

                (viii)  Record Date. If the Corporation takes a record of the
        holders of Common Stock for the purpose of entitling them (a) to receive
        a dividend or other distribution payable in Common Stock, Options or in
        Convertible Securities or (b) to subscribe for or purchase Common Stock,
        Options or Convertible Securities, then such record date shall be deemed
        to be the date of the issue or sale of the shares of Common Stock deemed
        to have been issued or sold upon the declaration of such dividend or
        upon the making of such other distribution or the date of the granting
        of such right of subscription or purchase, as the case may be.

        5D.     Subdivision or Combination of Common Stock. If the Corporation
at any time subdivides (by any stock split, stock dividend, recapitalization or
otherwise) one or more classes of its outstanding shares of Common Stock into a
greater number of shares, the Conversion Price in effect immediately prior to
such subdivision shall be proportionately reduced, and if the Corporation at any
time combines (by reverse stock split or otherwise) one or more classes of its
outstanding shares of Common Stock into a smaller number of shares, the
Conversion Price in effect immediately prior to such combination shall be
proportionately increased.

        5E.     Reorganization, Reclassification, Consolidation, Merger or Sale.
Any recapitalization, reorganization, reclassification, consolidation, merger,
sale of all or substantially all of the Corporation's assets or other
transaction, in each case which is effected in such a manner that the holders of
Common Stock are entitled to receive (either directly or upon subsequent
liquidation) stock, securities or assets with respect to or in exchange for
Common Stock held by such holders, is referred to herein as an "Organic Change".
Prior to the consummation of any Organic Change, the Corporation shall make
appropriate provisions to insure that each of the holders of Series I Preferred
Stock shall thereafter have the right to acquire and receive, in lieu of the
shares of Conversion Stock immediately theretofore acquirable and receivable
upon the conversion of such holder's Series I Preferred Stock, such shares of

                                        7

<PAGE>

stock, securities or assets as such holder would have received in connection
with such Organic Change if such holder had converted its Series I Preferred
Stock immediately prior to such Organic Change. The Corporation shall not effect
any such consolidation, merger or sale, unless prior to the consummation
thereof, the successor entity (if other than the Corporation) resulting from
consolidation or merger or the entity purchasing such assets assumes by written
instrument, the obligation to deliver to each such holder such shares of stock,
securities or assets as, in accordance with the foregoing provisions, such
holder may be entitled to acquire.

        5F.     Certain Events. If any event occurs of the type contemplated by
the provisions of this Section 5 but not expressly provided for by such
provisions (including, without limitation, the granting of stock appreciation
rights, phantom stock rights or other rights with equity features), then the
Corporation's Board of Directors shall make an appropriate adjustment in the
Conversion Price so as to protect the rights of the holders of Preferred Stock;
provided, that no such adjustment shall increase the Conversion Price or
decrease the number of shares of Conversion Stock issuable upon conversion of
each Share of Preferred Stock as otherwise determined pursuant to this Section
5.

        5G.     Notices.

                (i)     Immediately upon any adjustment of the Conversion Price,
        the Corporation shall give written notice thereof to all affected
        holders of Preferred Stock, setting forth in reasonable detail and
        certifying the calculation of such adjustment.

                (ii)    The Corporation shall give written notice to all holders
        of Preferred Stock at least 20 days prior to the date on which the
        Corporation closes its books or takes a record (a) with respect to any
        dividend or distribution upon Common Stock, (b) with respect to any pro
        rata subscription offer to holders of Common Stock or (c) for
        determining rights to vote with respect to any Organic Change,
        dissolution or liquidation.

                (iii)   The Corporation shall also give written notice to the
        holders of Preferred Stock at least 20 days prior to the date on which
        any Organic Change shall take place.

        Section 6. Purchase Rights. If at any time the Corporation grants,
issues or sells any Options, Convertible Securities or rights to purchase stock,
warrants, securities or other property pro rata to the record holders of any
class of Common Stock (the "Purchase Rights") and such rights are not
concurrently granted to the holders of the Preferred Stock, then each holder of
Initially Designated Preferred Stock or the Series I Preferred Stock shall be
entitled to acquire, upon the terms applicable to such Purchase Rights, the
aggregate Purchase Rights which such holder could have acquired if such holder
had held the number of shares of Conversion Stock acquirable upon conversion of
such holder's Initially Designated Preferred Stock or Series I Preferred Stock
immediately before the date on which a record is taken for the grant, issuance
or sale of such Purchase Rights, or if no such record is taken, the date as of
which the record holders of Common Stock are to be determined for the grant,
issue or sale of such Purchase Rights.

        Section 7. Registration of Transfer. The Corporation shall keep or have
its agent keep a register for the registration of Series I Preferred Stock. Upon
the surrender of any certificate

                                        8

<PAGE>

representing Preferred Stock at a place designated by the Corporation, the
Corporation shall, at the request of the record holder of such certificate,
execute and deliver (at the Corporation's expense) a new certificate or
certificates in exchange therefore representing in the aggregate the number of
Shares represented by the surrendered certificate. Each such new certificate
shall be registered in such name and shall represent such number of Shares as is
requested by the holder of the surrendered certificate and shall be
substantially identical in form to the surrendered certificate, and dividends
shall accrue on the Series I Preferred Stock represented by such new certificate
from the date to which dividends have been fully paid on such Series I Preferred
Stock represented by the surrendered certificate.

        Section 8. Replacement. Upon receipt of evidence reasonably satisfactory
to the Corporation (an affidavit of the registered holder shall be satisfactory)
of the ownership and the loss, theft, destruction or mutilation of any
certificate evidencing Shares, and in the case of any such loss, theft or
destruction, upon receipt of indemnity reasonably satisfactory to the
Corporation (provided that if the holder is a financial institution or other
institutional investor its own agreement shall be satisfactory), or, in the case
of any such mutilation upon surrender of such certificate, the Corporation shall
(at its expense) execute and deliver in lieu of such certificate a new
certificate of like kind representing the number of Shares of such class
represented by such lost, stolen, destroyed or mutilated certificate and dated
the date of such lost, stolen, destroyed or mutilated certificate, and dividends
shall accrue on the Shares represented by such new certificate from the date to
which dividends have been fully paid on such lost, stolen, destroyed or
mutilated certificate.

        Section 9. Definitions. To the extent not defined herein, terms shall
have the meaning set forth in the Charter.

        "Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person, where
"control" means the possession, directly or indirectly, of the power to direct
the management and policies of a Person whether through ownership of voting
securities, contract or otherwise.

        "Bayview Warrant" has the meaning set forth in the Charter.

        "Common Stock" means, collectively, the Corporation's common stock, par
value $0.004 per share, and any capital stock of any class of the Corporation
hereafter authorized which is not limited to a fixed sum or percentage of par or
stated value in respect to the rights of the holders thereof to participate in
dividends or in the distribution of assets upon any liquidation, dissolution or
winding up of the Corporation. "Common Stock Deemed Outstanding" means, at any
given time, the number of shares of Common Stock actually outstanding at such
time, plus the number of shares of Common Stock deemed to be outstanding
pursuant to subparagraphs 5C(i) and 5C(ii) hereof whether or not the Options or
Convertible Securities are actually exercisable at such time.

        "Common Warrants" means, collectively, the "Common Warrants" as defined
in the Charter.

        "Conversion Price" initially means $0.22 for the Series I Preferred
Stock.

                                        9

<PAGE>

        "Conversion Stock" means shares of the Corporation's Common Stock;
provided, that if there is a change such that the securities issuable upon
conversion of the Preferred Stock are issued by an entity other than the
Corporation or there is a change in the type or class of securities so issuable,
then the term "Conversion Stock" shall mean one share of the security issuable
upon conversion of the Preferred Stock if such security is issuable in shares,
or shall mean the smallest unit in which such security is issuable if such
security is not issuable in shares.

        "Convertible Securities" means any stock or securities directly or
indirectly convertible into or exchangeable for Common Stock.

        "Corporation" means Velocity Express Corporation, a Delaware
corporation, or, where applicable (for example, in connection with agreements
dated prior to the date of incorporation of the Corporation under the GCL), UST.
Where applicable, reference to certain agreements of the Corporation entered
into prior to its incorporation under the GCL refer to those as assumed by the
surviving entity as a matter of law under the expected merger between the
Corporation and UST.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended.

        "Initially Designated Preferred Stock" shall mean the Series B Preferred
Stock, Series C Preferred Stock, Series D Preferred Stock, Series F Preferred
Stock, Series G Preferred Stock and Series H Preferred Stock, together.

        "Junior Securities" has the meaning set forth in Section 1 of the
Charter.

        "Liquidation Event" has the meaning set forth in Section 3.

        "Liquidation Value" of any share of Series I Preferred Stock shall be
equal to $2.20.

        "Market Price" of any security means the average of the closing prices
of such security's sales on all securities exchanges on which such security may
at the time be listed, or, if there has been no sales on any such exchange on
any day, the average of the highest bid and lowest asked prices on all such
exchanges at the end of such day, or, if on any day such security is not so
listed, the average of the representative bid and asked prices quoted in the
NASDAQ System as of 4:00 P.M., New York time, or, if on any day such security is
not quoted in the NASDAQ System, the average of the highest bid and lowest asked
prices on such day in the domestic over-the-counter market as reported by the
National Quotation Bureau, Incorporated, or any similar successor organization,
in each such case averaged over a period of the twenty (20) consecutive trading
days immediately prior to the day as of which "Market Price" is being
determined. If at any time such security is not listed on any securities
exchange or quoted in the NASDAQ System or the over-the-counter market, the
"Market Price" shall be the fair value thereof determined jointly by the
Corporation and the holders of at least two-thirds of each of the then
outstanding classes of Preferred Stock, voting as individual classes. If such
parties are unable to reach agreement within a reasonable period of time, such
fair value shall be determined by an independent appraiser experienced in
valuing securities jointly selected by the Corporation and the holders of at
least two-thirds of each of the then outstanding classes of Preferred Stock,
voting as individual classes. The determination of such appraiser shall be final
and binding upon the parties, and the Corporation shall pay the fees and
expenses of such appraiser.

                                       10

<PAGE>

        "Options" means any rights, warrants or options to subscribe for or
purchase Common Stock or Convertible Securities.

        "Permitted Issuances" means the acts described in Section 5B(iii) of the
Charter.

        "Person" means an individual, a partnership, a corporation, a limited
liability company, a limited liability, an association, a joint stock company, a
trust, a joint venture, an unincorporated organization and a governmental entity
or any department, agency or political subdivision thereof.

        "Preferred Stock" shall have the meaning set forth in the Charter.

        "Preferred Warrants" means, collectively, the "Preferred Warrants" and
the "Additional Warrants" as defined in the Charter.

        "Series B Preferred Stock" shall mean the Corporation's Series B
Convertible Preferred Stock, par value $0.004 per share.

        "Series C Preferred Stock" shall mean the Corporation's Series C
Convertible Preferred Stock, par value $0.004 per share.

        "Series D Preferred Stock" shall mean the Corporation's Series D
Convertible Preferred Stock, par value $0.004 per share.

        "Series F Preferred Stock" shall mean the Corporation's Series F
Convertible Preferred Stock, par value $0.004 per share.

        "Series G Preferred Stock" shall mean the Corporation's Series G
Convertible Preferred Stock, par value $0.004 per share.

        "Series H Preferred Stock" shall mean the Corporation's Series H
Convertible Preferred Stock, par value $0.004 per share.

        "Series I Preferred Stock" shall mean the Corporation's Series I
Convertible Preferred Stock, par value $0.004 per share.

        "Series C Warrants" means, collectively, the "Series C Warrants" as
defined in, and issued pursuant to, Securities Purchase Agreement dated as of
September 1, 2000, by and among UST and certain investors, as such agreement may
from time to time be amended in accordance with its terms, and any warrants
issued in exchange, substitution or replacement therefore.

        "Share" has the meaning set forth in Section 3.

        "Stock Option Plans" means, collectively, the Corporation's 1995 Stock
Option Plan, 1996 Director Stock Option Plan and 2000 Stock Option Plan.

        "Subsidiary" means, with respect to any Person, any corporation, limited
liability company, partnership, association or other business entity of which
(i) if a corporation, a

                                       11

<PAGE>

majority of the total voting power of shares of stock entitled (without regard
to the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof, or (ii) if a limited liability company,
partnership, association or other business entity, a majority of the partnership
or other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more Subsidiaries of that person
or a combination thereof. For purposes hereof, a Person or Persons shall be
deemed to have a majority ownership interest in a limited liability company,
partnership, association or other business entity if such Person or Persons
shall be allocated a majority of limited liability company, partnership,
association or other business entity gains or losses or shall be or control the
managing general partner of such limited liability company, partnership,
association or other business entity.

        "UST" means United Shipping and Technology, Inc., a Utah corporation and
the predecessor of Velocity Express Corporation, a Delaware corporation.

        "Voting Securities" means securities of the Corporation ordinarily
having the power to vote for the election of directors of the Corporation;
provided, that when the term "Voting Securities" is used with respect to any
other Person it means the capital stock or other equity interests of any class
or kind ordinarily having the power to vote for the election of directors or
other members of the governing body of such Person.

        Section 10. Amendment and Waiver. No amendment, modification or waiver
shall be binding or effective with respect to any provision of Sections 1 to 10
hereof without the prior written consent of the holders of at least two-thirds
of Series I Preferred Stock outstanding, voting as individual series, at the
time such action is taken.

        Section 11. Notices. Except as otherwise expressly provided hereunder,
all notices referred to herein shall be in writing and shall be delivered by
registered or certified mail, return receipt requested and postage prepaid, or
by reputable overnight courier service, charges prepaid, and shall be deemed to
have been given when so mailed or sent (i) to the Corporation, at its principal
executive offices and (ii) to any stockholder, at such holder's address as it
appears in the stock records of the Corporation (unless otherwise indicated by
any such holder).

                                       12

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.2
<SEQUENCE>4
<FILENAME>dex42.txt
<DESCRIPTION>FORM OF SUBSCRIPTION RIGHTS CERTIFICATE
<TEXT>
<PAGE>

                                                                     EXHIBIT 4.2

Rights Certificate No.:                                        Number of Rights:

THE TERMS AND CONDITIONS OF THE RIGHTS OFFERING ARE SET FORTH IN THE COMPANY'S
PROSPECTUS DATED             , 2003 (THE "PROSPECTUS") AND ARE INCORPORATED
HEREIN BY REFERENCE. COPIES OF THE PROSPECTUS ARE AVAILABLE UPON REQUEST FROM
THE COMPANY.

                          VELOCITY EXPRESS CORPORATION
              Incorporated under the laws of the State of Delaware

                                                              CUSIP NO.: _______

                         SUBSCRIPTION RIGHTS CERTIFICATE
    Evidencing Subscription Rights to Purchase Shares of Series I Convertible
                 Preferred Stock of Velocity Express Corporation
                       Subscription Price: $2.20 per Share

     The Subscription Rights Will Expire If Not Exercised On or Before 5:00
      P.M., New York City Time, on __________, 2003, Unless Extended By the
                                     Company

REGISTERED OWNER:

        THIS CERTIFIES THAT the registered owner whose name is inscribed hereon
is the owner of the number of subscription rights ("Rights") set forth above.
Each whole Right entitles the holder thereof to subscribe for and purchase, at
the subscription price per Right of $2.20 (the "Subscription Price"), one share
of the Series I Convertible Preferred Stock, par value $0.004 per share ("Series
I Preferred") of Velocity Express Corporation, a Delaware corporation (the
"Company") (the "Basic Subscription Right"), pursuant to a rights offering (the
"Rights Offering"), on the terms and subject to the conditions set forth in the
Prospectus and the "Instructions for Use of Velocity Express Subscription Rights
Certificates" accompanying this Subscription Rights Certificate.

        If any shares of the Series I Preferred available for purchase in the
Rights Offering are not purchased by other holders of Rights pursuant to the
exercise of their Basic Subscription Right (the "Excess Shares"), any Rights
holder that exercises its Basic Subscription Rights in full may subscribe for a
number of Excess Shares pursuant to the terms and conditions of the Rights
Offering, subject to proration, as described in the Prospectus (the
"Over-Subscription Right"). The Rights represented by this Subscription Rights
Certificate may be exercised by completing Form-1 and any other appropriate
forms on the reverse side hereof and by returning the full payment of the
Subscription Price for each Right subscribed for in accordance with the
"Instructions for Use of Velocity Express Subscription Rights Certificates" that
accompany this Subscription Rights Certificate.

        This Subscription Rights Certificate is not valid unless countersigned
by the transfer agent and registered by the registrar.

<PAGE>

        IN WITNESS WHEREOF, the Company has caused this Subscription Rights
Certificate to be duly executed under its corporate seal.

Dated:  ____________, 2003

                                              VELOCITY EXPRESS CORPORATION


                                              By:
                                                  ------------------------------
                                                  Name:
                                                  Title:

                                              By:
                                                  ------------------------------
                                                  Name:
                                                  Title:

COUNTERSIGNED AND REGISTERED BY:

AMERICAN STOCK TRANSFER & TRUST
COMPANY (New York, NY)
Transfer Agent And Registrar

By:
    ----------------------------
    Name:
    Title:

                                        2

<PAGE>

              DELIVERY OPTIONS FOR SUBSCRIPTION RIGHTS CERTIFICATE

            For delivery by mail, hand delivery or overnight courier:

                     American Stock Transfer & Trust Company
                           59 Maiden Lane, Plaza Level
                            New York, New York 10038

     Delivery other than in the manner or to the addresses listed above will
                         not constitute valid delivery.

                PLEASE PRINT ALL INFORMATION CLEARLY AND LEGIBLY.

FORM 1 - EXERCISE OF SUBSCRIPTION RIGHTS

        To subscribe for shares pursuant to your Basic Subscription Right,
please complete lines (a) and (c) and sign under Form 3 below. To subscribe for
shares pursuant to your Over-subscription Right, please also complete line (b)
and sign under Form 3 below.

(a)     I apply for ___________________ Shares x     $2.20       =  $___________
                    (No. of new Shares)      (subscription price)     (Payment)

        If you have exercised your Basic Subscription Right in full and wish to
subscribe for additional shares pursuant to your Over-Subscription Right:

(b)     I apply for ___________________ Shares x     $2.20       =  $___________
                    (No. of new Shares)      (subscription price)     (Payment)

(c)     Total Amount of Payment Enclosed = $__________________________

METHOD OF PAYMENT (CHECK ONE):

[ ]     Check or bank draft drawn on a U.S. bank, or postal, telegraphic or
        express money order payable to "American Stock Transfer & Trust Company,
        as Subscription Agent for Velocity Express Corporation." Funds paid by
        an uncertified check may take at least five business days to clear.

[ ]     Wire transfer of immediately available funds directly to the account
        maintained by American Stock Transfer & Trust Company, as Subscription
        Agent for Velocity Express Corporation, for purposes of accepting
        subscriptions in this Rights Offering at [JPMorgan Chase Bank, 55 Water
        Street, New York, New York 10005, ABA #021000021], Account
        #[______________].

                                        3

<PAGE>

FORM 2 - DELIVERY TO DIFFERENT ADDRESS

        If you wish for the Series I Preferred underlying your subscription
rights to be delivered to an address different from that shown on the face of
this Subscription Rights Certificate, please enter the alternate address below,
sign under Form 3 and have your signature guaranteed under Form 4.

        ______________________________________________

        ______________________________________________

        ______________________________________________

FORM 3 - SIGNATURE

        I acknowledge that I have received the Prospectus for this Rights
Offering and I hereby irrevocably subscribe for the number of shares indicated
above on the terms and conditions specified in the Prospectus.

--------------------------------------------------------------------------------
Signature(s)

IMPORTANT: The signature(s) must correspond with the name(s) as printed on the
reverse of this Subscription Rights Certificate in every particular, without
alteration or enlargement, or any other change whatsoever.

FORM 4 - SIGNATURE GUARANTEE

        This form must be completed if you have completed any portion of Form 2.

Signature Guaranteed:
                       -------------------------------------------------
                                    (Name of Bank or Firm)

By:
     -----------------------------------------------------
                    (Signature of Officer)

IMPORTANT: The signature(s) should be guaranteed by an eligible guarantor
institution (bank, stock broker, savings & loan association or credit union)
with membership in an approved signature guarantee medallion program pursuant to
Securities and Exchange Commission Rule 17Ad-15.

                                        4

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.3
<SEQUENCE>5
<FILENAME>dex43.txt
<DESCRIPTION>FORM OF SERIES I CONVERTIBLE PREFERRED STOCK CERTIFICATE
<TEXT>
<PAGE>

                                                                     EXHIBIT 4.3

                   INCORPORATED UNDER THE LAWS OF THE STATE OF

       Number                                                    Shares
      SPECIMEN            [Velocity Express Logo]               SPECIMEN

Series I Convertible Preferred Stock       Series I Convertible Preferred Stock

<TABLE>
<S>                                                                     <C>
                          Velocity Express Corporation                    See reverse for
              INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE      certain definitions
</TABLE>

This CERTIFIES that                                      CUSIP _________________

is the owner of

     FULLY PAID AND NON-ASSESSABLE SHARES OF SERIES I CONVERTIBLE PREFERRED
                 STOCK, OF THE PAR VALUE OF $.004 PER SHARE, OF

                          Velocity Express Corporation

transferable only on the books of the Corporation by the holder hereof in person
or by Attorney upon surrender of this certificate properly endorsed. This
certificate is not valid unless countersigned by the Transfer Agent and
Registrar.

        IN WITNESS WHEREOF, the said Corporation has caused this certificate to
be signed by the facsimile signature of its duly authorized officers.

Dated:
        -------------------------------         --------------------------------
                   SECRETARY                        CHIEF EXECUTIVE OFFICER

<PAGE>
                          VELOCITY EXPRESS CORPORATION

THE CORPORATION IS AUTHORIZED TO ISSUE DIFFERENT CLASSES OF SHARES, IN
ACCORDANCE WITH THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE, UPON
WRITTEN REQUEST BY THE SHAREHOLDER, THE CORPORATION WILL FURNISH, WITHOUT
CHARGE, A SUMMARY OF THE DESIGNATIONS, PREFERENCES, LIMITATIONS AND RELATIVE
RIGHTS APPLICABLE TO EACH CLASS OF SHARES.

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

        The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

<TABLE>
        <S>                <C>                                     <C>      <C>
        TEN COM     --     as tenants in common                    UTMA     --    ..........Custodian..........
        TEN ENT     --     as tenants by entireties                                 (Cust)            (Minor)
        JT TEN      --     as joint tenants with right of                        under Uniform Transfer to Minors
                           survivorship and not as tenants
                           in common                                         Act  ................
                                                                                       (State)
</TABLE>

     Additional abbreviations may also be used though not in the above list.

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

       For value received __________ hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER
   IDENTIFYING NUMBER OF ASSIGNEE

________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE

________________________________________________________________________________

________________________________________________________________________________

____________________________________________________________ Shares of the
capital stock represented by the within Certificate, and do hereby irrevocably
constitute and appoint ______________________________________ Attorney to
transfer the said stock on the books of the within-named Corporation with full
power of substitution in the premises

Dated                                              _____________________________


                                                   -----------------------------
                                                   NOTICE: THE SIGNATURE TO THIS
                                                   ASSIGNMENT MUST CORRESPOND
                                                   WITH THE NAME AS WRITTEN UPON
                                                   THE FACE OF THE CERTIFICATE
                                                   IN EVERY PARTICULAR WITHOUT
                                                   ALTERATION OR ENLARGEMENT OR
                                                   ANY CHANGE WHATEVER.

Signature Guaranteed

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>6
<FILENAME>dex51.txt
<DESCRIPTION>OPINION OF WESLEY C. FREDENBURG
<TEXT>
<PAGE>

                                                                     EXHIBIT 5.1

[Velocity Express Corporation Letterhead]

Velocity Express Corporation
7803 Glenroy Road, Suite 200
Minneapolis, Minnesota 55439

                                 October 1, 2003

        Re:     Velocity Express Corporation Registration Statement on Form S-3
                Rights Offering of Series I Preferred Stock

Ladies and Gentlemen:

        I am the General Counsel and Secretary of Velocity Express Corporation,
a Delaware corporation (the "Company") and have acted as counsel to the Company
in connection with the registration by the Company on a registration statement
on Form S-3 (the "Registration Statement") of (i) non-transferable subscription
rights (the "Rights") distributed in connection with a rights offering (the
"Rights Offering") by the Company to the holders of record of its outstanding
capital stock, including its Common Stock, par value $0.004 per share ("Common
Stock"), its Series B Convertible Preferred Stock, par value $0.004 per share,
its Series C Convertible Preferred Stock, par value $0.004 per share, its Series
D Convertible Preferred Stock, par value $0.004 per share, its Series F
Convertible Preferred Stock, par value $0.004 per share, its Series G
Convertible Preferred Stock, par value $0.004 per share, and its Series H
Convertible Preferred Stock, par value $0.004 per share (collectively the
"Holders"); (ii) up to 8,409,091 shares of the Company's Series I Convertible
Preferred Stock, par value $0.004 per share ("Series I Preferred"), issuable
upon the exercise of the Rights; and (iii) up to 84,090,910 shares of Common
Stock issuable upon conversion of the Series I Preferred Stock.

        I have examined such documents and reviewed such questions of law as I
have considered necessary and appropriate for purposes of this opinion.

        In rendering the opinions set forth below, I have assumed, without
verification, the authenticity of all documents submitted to me as originals,
the genuineness of all signatures and the conformity to authentic originals of
all documents submitted to me as copies. I have also assumed the legal capacity
for all purposes relevant hereto of all natural persons and, with respect to all
parties to agreements or instruments relevant hereto other than the Company,
that such parties had the requisite power and authority (corporate or otherwise)
to execute, deliver and perform such agreements or instruments, that such
agreements or instruments have been duly authorized by all requisite action
(corporate or otherwise), executed and delivered by such parties and that such
agreements or instruments are the valid, binding and enforceable obligations of
such parties. As to questions of fact material to my opinions, I have relied, to
an extent I deemed appropriate, upon certificates of officers of the Company and
of public officials. To the extent that I have relied on certificates of public
officials, I have assumed the same to have been properly given and to be
accurate.

<PAGE>

October 1, 2003
Page 2

        Based on the foregoing, I am of the opinion that:

        1.      The issuance of the Rights has been duly authorized by all
                requisite corporate action and when the Rights are distributed
                to the Holders as contemplated in the Registration Statement,
                they will be validly issued.

        2.      The issuance and sale of the Series I Preferred upon exercise of
                the Rights have been duly authorized by all requisite corporate
                action and when (i) the Holders of the Rights have complied with
                the terms of the Rights in connection with the exercise thereof,
                and (ii) certificates representing the Series I Preferred in the
                form of the specimen certificate examined by me have been signed
                by an authorized officer of the Company and countersigned and
                registered by the transfer agent, and have been delivered
                against payment therefore in the manner described in the
                Registration Statement, the Series I Preferred will be validly
                issued, fully paid and nonassessable.

        3.      The issuance of the Common Stock upon conversion of the Series I
                Preferred have been duly authorized by all requisite corporate
                action and when issued pursuant to the terms of the Series I
                Preferred, will be validly issued, fully paid and nonassessable.

        My opinions set forth above are subject to the following qualifications
and exceptions:

        (a)     My opinions are subject to the effect of any applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
similar laws of general application relating to or affecting creditors' rights.

        (b)     My opinions are subject to the effects of general principles of
equity, including (without limitation) concepts of materiality, reasonableness,
good faith and fair dealing, and other similar doctrines affecting the
enforceability of agreements generally (regardless of whether considered in a
proceeding in equity or at law).

        (c)     In rendering my opinions set forth above, I have assumed that at
the time of issuance of the Rights, the Series I Preferred and the Common Stock
upon conversion of the Series I Preferred, the Registration Statement is
effective under the Securities Exchange Act of 1933, as amended (the "Act") and
continues to be effective.

        My opinion expressed above is limited to the laws of the State of
Minnesota and the federal laws of the United States of America.

                                        2

<PAGE>

October 1, 2003
Page 3

        I hereby consent to the filing of this opinion with the Securities
Exchange Commission as an exhibit to the Registration Statement and to the
reference of myself under the caption "Legal Matters" in the Prospectus
constituting part of the Registration Statement. In giving this consent, I do
not thereby admit that I am included in the category of persons whose consent is
required under Section 7 of the Act or the rules and regulations of the
Commission.


                                             Very truly yours,

                                             /s/ Wesley Fredenburg
                                             -----------------------------------
                                             Wesley Fredenburg
                                             General Counsel and Secretary

                                        3

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12.1
<SEQUENCE>7
<FILENAME>dex121.txt
<DESCRIPTION>STATEMENT REGARDING COMPUTATION OF RATIOS
<TEXT>
<PAGE>


                                                                   Exhibit 12.1

                          Velocity Express Corporation
Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends

<TABLE>
<CAPTION>

                                       Nine Months
                                          Ended                                      Year Ended
                                     --------------  ------------------------------------------------------------------------------
                                     March 29, 2003  June 29, 2002    June 30, 2001  July 1, 2000 (1)  June 30, 1999  June 30, 1998
                                     --------------  -------------    -------------  ----------------  -------------  -------------
<S>                                  <C>             <C>              <C>            <C>               <C>            <C>


Fixed charges                           $2,249,625     $12,577,105     $  6,333,985    $  5,272,000     $     4,000    $    (3,654)

Earnings                                $2,088,413     $14,543,372     $(22,435,940)   $(18,041,000)    $(2,887,210)   $(1,908,438)

Ratio of Earnings to Fixed Charges            0.93            1.16            (3.54)          (3.42)        (721.80)        522.29
</TABLE>


--------------------------
(1) During the first quarter of fiscal 2000, the Company acquired all the common
stock of Velocity Express, Inc., formerly known as Corporate Express Delivery
Systems, Inc. The results of operations of Velocity are included from the date
of acquisition.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>8
<FILENAME>dex231.txt
<DESCRIPTION>CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
<TEXT>
<PAGE>

                                                                    EXHIBIT 23.1

                         CONSENT OF INDEPENDENT AUDITORS

We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of Velocity Express
Corporation for the registration of 8,409,091 shares of its Series I Convertible
Preferred Stock, and 84,090,910 shares of its common stock issuable upon
conversion of the Series I Convertible Preferred Stock and to the incorporation
by reference therein of our report dated September 4, 2002, except for Note 13,
as to which the date is July 24, 2003, with respect to the consolidated
financial statements and schedules of Velocity Express Corporation included in
its Annual Report (Form 10-K/A-2) for the year ended June 29, 2002, filed with
the Securities and Exchange Commission.

                                                   /s/ Ernst & Young LLP
                                                   Ernst & Young LLP

Minneapolis, Minnesota
September 30, 2003

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-24.1
<SEQUENCE>9
<FILENAME>dex241.txt
<DESCRIPTION>POWERS OF ATTORNEY
<TEXT>
<PAGE>

                                                                    EXHIBIT 24.1

                                POWER OF ATTORNEY

        KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Wesley C. Fredenburg his true and
lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities to sign a Registration Statement on Form S-3 of Velocity Express
Corporation (the "Company") and any and all amendments thereto, including
post-effective amendments, for the sale of subscription rights, Series I
Convertible Preferred Stock and the underlying Common Stock of the Company, and
to file the same, with all exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission and with such state
securities commissions and other agencies as necessary; granting unto said
attorney-in-fact and agent, full power and authority to do and perform to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or the substitutes for such
attorney-in-fact and agent, may lawfully do or cause to be done by virtue
hereof.

             Name                             Title                  Date
             ----                             -----                  ----

     /s/ Vincent A. Wasik                    Director         September 30, 2003
-------------------------------
       Vincent A. Wasik

       /s/ Alex Paluch                       Director         September 30, 2003
-------------------------------
         Alex Paluch

      /s/ James G. Brown                     Director         September 30, 2003
-------------------------------
        James G. Brown

      /s/ Douglas Hsieh                      Director         September 30, 2003
-------------------------------
        Douglas Hsieh

      /s/ Richard Kassar                     Director         September 30, 2003
-------------------------------
        Richard Kassar

     /s/ Leslie E. Grodd                     Director         September 30, 2003
-------------------------------
       Leslie E. Grodd

        /s/ Jack Kemp                        Director         September 30, 2003
-------------------------------
          Jack Kemp

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>10
<FILENAME>dex991.txt
<DESCRIPTION>FORM OF INSTRUCTIONS FOR USE OF VELOCITY EXPRESS SUBSCRIPTION RIGHTS CERTIFICATE
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.1

                    INSTRUCTIONS FOR USE OF VELOCITY EXPRESS
                        SUBSCRIPTION RIGHTS CERTIFICATES

      Consult the Velocity Express, Your Bank or Broker as to Any Questions

        The following instructions relate to a rights offering (the "Rights
Offering") by Velocity Express Corporation, a Delaware corporation (the
"Company"), to the holders of record (the "Record Holders") of its Common Stock,
par value $0.004 per share ("Common Stock"), its Series B Convertible Preferred
Stock, par value $0.004 per share ("Series B Preferred"), its Series C
Convertible Preferred Stock, par value $0.004 per share ("Series C Preferred"),
its Series D Convertible Preferred Stock, par value $0.004 per share ("Series D
Preferred"), its Series F Convertible Preferred Stock, par value $0.004 per
share ("Series F Preferred"), its Series G Convertible Preferred Stock, par
value $0.004 per share ("Series G Preferred"), its Series H Convertible
Preferred Stock, par value $0.004 per share ("Series H Preferred" and together
with the Common Stock, the Series B Preferred, the Series C Preferred, the
Series D Preferred, the Series F Preferred and the Series G Preferred, the
"Capital Stock") as described in the Company's Prospectus dated
___________________, 2003 (the "Prospectus"). Record Holders of the Capital
Stock at the close of business on September 11, 2003 (the "Record Date") are
receiving subscription rights (the "Rights") to subscribe for and purchase
shares of the Company's Series I Convertible Preferred Stock, par value $0.004
per share (the "Series I Preferred").

        Holders of Common Stock will receive 0.297952777 right for every share
of Common Stock held on the Record Date. Holders of Series B Preferred will
receive 0.486231363 rights for each share of Series B Preferred held on the
Record Date; holders of Series C Preferred will receive 0.329810541 rights for
each share of Series C Preferred held on the Record Date; holders of Series D
Preferred will receive 0.813565586 rights for each share of Series D Preferred
held on the Record Date; holders of Series F Preferred will receive 1.745371947
rights for each share of Series F Preferred held on the Record Date; holders of
Series G Preferred will receive 0.072517623 rights for each share of Series G
Preferred held on the Record Date; and holders of Series H Preferred will
receive 2.979527767 rights for each share of Series H Preferred held on the
Record Date.

        The Rights will expire, if not exercised, at 5:00 p.m., New York City
time, on _______________, 2003, unless extended in the sole discretion of the
Company (as it may be extended, the "Expiration Date"). After the Expiration
Date, unexercised Rights will be null and void. The Company will not be
obligated to honor any purported exercise of Rights received by American Stock
Transfer & Trust Company (the "Subscription Agent") after 5:00 p.m., New York
City time, on the Expiration Date, regardless of when the documents relating to
such exercise were sent, except pursuant to the Guaranteed Delivery Procedures
described below. The Company may extend the Expiration Date by giving oral or
written notice to the Subscription Agent on or before the Expiration Date,
followed by a press release no later than 9:00 a.m., New York City time, on the
next business day after the previously scheduled Expiration Date. The Rights
will be evidenced by non-transferable Rights certificates (the "Subscription
Rights Certificates").

        Each Right will entitle its holder to subscribe for one share of Series
I Preferred (the "Basic Subscription Right"). The subscription price (the
"Subscription Price") for the Series I Preferred is $2.20 per share.

        In addition, each holder of Rights who exercises his/her Basic
Subscription Right in full will be eligible to subscribe (the "Over-Subscription
Right") at the same cash price of $2.20 per share for shares of the Series I
Preferred that are not otherwise purchased pursuant to the exercise of Rights
under the Basic Subscription Right (the "Excess Shares"), subject to
availability and pro ration as described below.

<PAGE>

Each holder of Rights may only exercise his/her Over-Subscription Right if
he/she exercised his/her Basic Subscription Right in full and other holders of
subscription Rights do not exercise their Basic Subscription Right in full. If
there are not enough Excess Shares to satisfy all subscriptions made under the
Over-Subscription Right, the Company will allocate the remaining Excess Shares
pro rata, after eliminating all fractional shares, among those Rights holders
who exercised their Over-Subscription Rights. "Pro rata" means in proportion to
the amount of over-subscription price tendered by each person seeking to
oversubscribe as of the expiration date of the offering. If there is a pro rata
allocation of the remaining Excess Shares and a holder of Rights receives an
allocation of a greater number of Excess Shares than he/she subscribed for under
his/her Over-Subscription Right, then the Company will allocate to him/her only
the number of Excess Shares for which he or she subscribed. The Company will
allocate the remaining Excess Shares among all other holders exercising their
Over-Subscription Rights. See "The Rights Offering--Subscription Rights" in the
Prospectus.

        The number of Rights to which you are entitled is printed on the face of
your Subscription Rights Certificate. You should indicate your wishes with
regard to the exercise of your Rights by completing the appropriate portions of
your Subscription Rights Certificate and returning the certificate to the
Subscription Agent in the envelope provided pursuant to the procedures described
in the Prospectus.

        YOUR SUBSCRIPTION RIGHTS CERTIFICATES, OR NOTICE OF GUARANTEED DELIVERY,
AND SUBSCRIPTION PRICE PAYMENT, INCLUDING FINAL CLEARANCE OF ANY CHECKS, MUST BE
RECEIVED BY THE SUBSCRIPTION AGENT, ON OR BEFORE 5:00 P.M., NEW YORK CITY TIME,
ON THE EXPIRATION DATE. ONCE A HOLDER OF RIGHTS HAS EXERCISED THE BASIC
SUBSCRIPTION RIGHT OR THE OVER-SUBSCRIPTION RIGHT, SUCH EXERCISE MAY NOT BE
REVOKED. RIGHTS NOT EXERCISED PRIOR TO THE EXPIRATION TIME OF THE RIGHTS
OFFERING WILL EXPIRE.

        To exercise Rights, complete your Subscription Rights Certificate and
send the properly completed and executed Subscription Rights Certificate
evidencing such Rights with any signatures required to be guaranteed so
guaranteed, together with payment in full of the Subscription Price for each
share of Series I Preferred subscribed for pursuant to the Basic Subscription
Right and the Over-Subscription Right, to the Subscription Agent, on or prior to
5:00 p.m., New York City time, on the Expiration Date. Payment of the
Subscription Price will be held in a segregated account to be maintained by the
Subscription Agent. All payments must be made in U.S. dollars for the full
number of Series I Preferred being subscribed for (a) by check or bank draft
drawn upon a U.S. bank or postal, telegraphic or express money order payable to
American Stock Transfer & Trust Company, as Subscription Agent, or (b) by wire
transfer of immediately available funds, to the account maintained by the
Subscription Agent for purposes of accepting subscriptions in the Rights
Offering at ______________ ABA No. ____________, further credit to
___________________, ATTN: ___________________ (the "Subscription Account"). Any
wire transfer should clearly indicate the identity of the subscriber who is
paying the Subscription Price by the wire transfer. Payments will be deemed to
have been received by the Subscription Agent only upon (i) clearance of any
uncertified check, (ii) receipt by the Subscription Agent of any certified check
or bank draft drawn upon a U.S. bank or of any postal, telegraphic or express
money order or (iii) receipt of collected funds in the Subscription Account
designated above. If paying by uncertified personal check, please note that the
funds paid thereby may take at least five business days to clear. Accordingly,
Rights holders who wish to pay the Subscription Price by means of uncertified
personal check are urged to make payment sufficiently in advance of the
Expiration Date to ensure that such payment is received and clears by such date
and are urged to consider payment by means of certified or cashier's check,
money order or wire transfer of funds.

                                        2

<PAGE>

       The Subscription Rights Certificate and payment of the Subscription
Price, or, if applicable, Notices of Guaranteed Delivery (as defined below) must
be delivered to the Subscription Agent by one of the methods described below:

                                    By Mail:
                     American Stock Transfer & Trust Company
                                 59 Maiden Lane
                               New York, NY 10038

                          By Hand or Overnight Courier:
                     American Stock Transfer & Trust Company
                                 59 Maiden Lane
                               New York, NY 10038
                                 (718) 234-5001

                Telephone Number for Confirmation: (800) 937-5449

        Questions may be answered by, and additional copies of relevant
documents may be obtained through, contacting Wesley Fredenburg, our General
Counsel and Secretary, at:

                          Velocity Express Corporation
                          7803 Glenroy Road, Suite 200
                          Minneapolis, Minnesota 55439
                                 (612) 492-2405

        Delivery to an address other than those above does not constitute valid
delivery.

        By making arrangements with your bank or broker for the delivery of
funds on your behalf, you may also request such bank or broker to exercise the
Subscription Rights Certificate on your behalf. Alternatively, you may cause a
written guarantee substantially in the form of Exhibit A to these instructions
(the "Notice of Guaranteed Delivery"), from a member firm of a registered
national securities exchange or a member of the National Association of
Securities Dealers Corporation, or from a commercial bank or trust company
having an office or correspondent in the United States or from a bank,
stockbroker, savings and loan association or credit union with membership in an
approved signature guarantee medallion program, pursuant to Rule 17Ad-15 of the
Securities Exchange Act of 1934, as amended (each, an "Eligible Institution"),
to be received by the Subscription Agent on or prior to the Expiration Date
together with payment in full of the applicable Subscription Price. Such Notice
of Guaranteed Delivery must state your name, the number of Rights represented by
the Subscription Rights Certificate or Subscription Rights Certificates held by
you, the number of Series I Preferred being subscribed for pursuant to your
Basic Subscription Right and the number of Series I Preferred, if any, being
subscribed for pursuant to the Over-Subscription Right, and that you will
guarantee the delivery to the Subscription Agent of any properly completed and
executed Subscription Rights Certificate or Subscription Rights Certificates
evidencing such Rights within three (3) business days following the date of the
Notice of Guaranteed Delivery. If this procedure is followed, the properly
completed Subscription Rights Certificate or Subscription Rights Certificates
evidencing the Rights being exercised, with any signatures required to be
guaranteed so guaranteed, must be received by the Subscription Agent within
three (3) business days following the date of the Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered to the Subscription Agent in
the same manner as Subscription Rights Certificates at the address set forth
above, or may be transmitted to the Subscription Agent by facsimile transmission
(Facsimile No.: (718) 236-2641). Additional copies of the Notice of Guaranteed

                                        3

<PAGE>

Delivery may be obtained upon request from the Company at the address, or by
calling the telephone number, set forth above.

        Banks, brokers and other nominee holders of Rights who exercise the
Basic Subscription Right and the Over-Subscription Right on behalf of beneficial
owners of Rights will be required to certify to the Subscription Agent and the
Company, in connection with the exercise of the Over-Subscription Right, as to
the aggregate number of Rights that have been exercised and the number of Series
I Preferred that are being subscribed for pursuant to the Over-Subscription
Right, by each beneficial owner of Rights (including such nominee itself) on
whose behalf such nominee holder is acting. If more Excess Shares are subscribed
for pursuant to the Over-Subscription Right than are available for sale, the
Excess Shares will be allocated, as described above, among beneficial owners
exercising the Over-Subscription Right in proportion to the amount of
Over-Subscription price tendered by each person seeking to oversubscribe as of
the expiration date of the Rights Offering.

        If the aggregate Subscription Price paid by you is insufficient to
purchase the number of Series I Preferred subscribed for, or if no number of
Series I Preferred to be purchased is specified, then you will be deemed to have
exercised the Basic Subscription Right to purchase Series I Preferred to the
full extent of the payment tendered.

        If the aggregate Subscription Price paid by you exceeds the amount
necessary to purchase the number of Series I Preferred for which you have
indicated an intention to subscribe (such excess being the "Subscription
Excess"), then you will be deemed to have exercised the Over-Subscription Right
to the full extent of the excess payment tendered, to purchase, to the extent
available, that number of Series I Preferred equal to the quotient obtained by
dividing the Subscription Excess by the Subscription Price. Any remaining amount
shall be returned to you by mail without interest or deduction as soon as
practicable after the Expiration Date and after all pro rations and adjustments
contemplated by the terms of the Rights Offering have been effected.

        The following deliveries and payments will be made to the address shown
on the face of your Subscription Rights Certificate unless you provide
instructions to the contrary in your Subscription Rights Certificate.

                (a)     Basic Subscription Right. As soon as practicable after
        the Expiration Date and the valid exercise of Rights, the Subscription
        Agent will mail to each exercising Rights holder certificates
        representing shares of Series I Preferred purchased pursuant to the
        Basic Subscription Right. See "The Rights Offering--Subscription
        Rights--Basic Subscription Right" in the Prospectus.

                (b)     Over-Subscription Right. As soon as practicable after
        the Expiration Date and after all pro rations and adjustments
        contemplated by the terms of the Rights Offering have been effected, the
        Subscription Agent will mail to each Rights holder who validly exercises
        the Over-Subscription Right certificates representing the number of
        shares of Series I Preferred, if any, allocated to such Rights holder
        pursuant to the Over-Subscription Right. See "The Rights
        Offering--Subscription Rights--Over-Subscription Right" in the
        Prospectus.

                (c)     Excess Cash Payments. As soon as practicable after the
        Expiration Date and after all pro rations and adjustments contemplated
        by the terms of the Rights Offering have been effected, the Subscription
        Agent will mail to each Rights holder who exercises the
        Over-Subscription Right any excess amount, without interest or
        deduction, received in payment of the Subscription Price for Excess
        Shares that are subscribed for by such Rights holder but not allocated
        to such Rights holder pursuant to the Over-Subscription Right.

                                        4

<PAGE>

        The Company will pay all fees and expenses of the Subscription Agent and
has also agreed to indemnify the Subscription Agent from certain liabilities
that they may incur in connection with the Rights Offering.

        The signature on the Subscription Rights Certificate must correspond
with the name of the registered holder exactly as it appears on the face of the
Subscription Rights Certificate without any alteration or change whatsoever.
Persons who sign the Subscription Rights Certificate in a representative or
other fiduciary capacity must indicate their capacity when signing and, unless
waived by the Subscription Agent in its sole and absolute discretion, must
present to the Subscription Agent satisfactory evidence of their authority to so
act.

        If the Subscription Rights Certificate is executed by a person other
than the holder named on the face of the Subscription Rights Certificate, proper
evidence of authority of the person executing the Subscription Rights
Certificate must accompany the same unless, for good cause, the Subscription
Agent dispenses with proof of authority.

        Your signature must be guaranteed by an Eligible Institution if you
specify special payment or delivery instructions.

        The method of delivery of Subscription Rights Certificates and payment
of the Subscription Price to the Subscription Agent will be at the election and
risk of the Rights holder, but, if sent by mail, it is recommended that such
certificates and payments be sent by registered mail, properly insured, with
return receipt requested, and that a sufficient number of days be allowed to
ensure delivery to the Subscription Agent and the clearance of payment prior to
5:00 p.m., New York City time, on the Expiration Date. Because uncertified
personal checks may take at least five business days to clear, you are strongly
urged to pay, or arrange for payment, by means of certified or cashier's check,
money order or wire transfer of funds.

                                        5

<PAGE>

                                                                       EXHIBIT A

                          NOTICE OF GUARANTEED DELIVERY
                                       FOR
                     SUBSCRIPTION RIGHTS CERTIFICATES ISSUED
                         BY VELOCITY EXPRESS CORPORATION

        This form, or one substantially equivalent hereto, must be used to
exercise Rights pursuant to the Rights Offering described in the Prospectus
dated ___________________, 2003 (the "Prospectus") of Velocity Express
Corporation, a Delaware corporation (the "Company"), if a holder of Rights
cannot deliver the certificate(s) evidencing the Rights (the "Subscription
Rights Certificate(s)"), to the Subscription Agent listed below (the
"Subscription Agent") at or prior to 5:00 p.m., New York City time, on
___________________, 2003, unless such time is extended, or the Rights Offering
is terminated, each as may be determined by the Company as described in the
Prospectus (as it may be extended or terminated, the "Expiration Date"). Such
form must be delivered by hand or sent by telegram, facsimile transmission,
first class mail or overnight courier to the Subscription Agent, and must be
received by the Subscription Agent on or prior to the Expiration Date. See "The
Rights Offering--Method of Subscription--Exercise of Rights" in the Prospectus.
Payment of the Subscription Price of $2.20 per share for each share of the
Company's Series I Convertible Preferred Stock, par value $0.004 ("Series I
Preferred"), subscribed for upon exercise of such Rights must be received by the
Subscription Agent in the manner specified in "The Rights Offering--Method of
Payment" in the Prospectus at or prior to 5:00 p.m., New York City time on the
Expiration Date even if the Subscription Rights Certificate(s) evidencing such
Rights is (are) being delivered pursuant to the Guaranteed Delivery Procedures
thereof. See "The Rights Offering--Method of Subscription--Exercise of Rights"
in the Prospectus.

                           The Subscription Agent is:

                     AMERICAN STOCK TRANSFER & TRUST COMPANY

       If by Mail or Telegram:               If by Hand or Overnight Courier:
American Stock Transfer & Trust Company  American Stock Transfer & Trust Company
           59 Maiden Lane                            59 Maiden Lane
         New York, NY 10038                        New York, NY 10038
        Confirm by Telephone:                    Facsimile Transmission:
          (800) 937-5449                            (718) 234-5001

        DELIVERY OR TRANSMISSION OF THIS INSTRUMENT OTHER THAN AS SET FORTH
ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.

        Questions may be answered by, and additional copies of relevant
documents may be obtained through contacting the Company's General Counsel and
Secretary, Wesley Fredenburg:

                          Velocity Express Corporation
                          7803 Glenroy Road, Suite 200
                          Minneapolis, Minnesota 55439
                                 (612) 492-2405

                                       A-1

<PAGE>

Ladies and Gentlemen:

        The undersigned hereby represents that the undersigned is the holder of
Subscription Rights Certificate(s) representing ___________________ Rights and
that such Subscription Rights Certificate(s) cannot be delivered to the
Subscription Agent at or before 5:00 p.m., New York City time, on the Expiration
Date. Upon the terms and subject to the conditions set forth in the Prospectus,
receipt of which is hereby acknowledged, the undersigned hereby elects to
exercise (i) the Basic Subscription Right to subscribe for ________ share(s) of
Series I Preferred with respect to each of the Rights represented by such
Subscription Rights Certificate(s) and (ii) the Over-Subscription Right relating
to such Rights, to the extent that shares of Series I Preferred that are not
otherwise purchased pursuant to the exercise of the Basic Subscription Rights
(the "Excess Shares") are available therefor, for an aggregate of up to Excess
Shares, subject to availability and pro ration.

        The undersigned understands that payment of the Subscription Price of
$2.20 per share for each share of Series I Preferred subscribed for pursuant to
the Basic Subscription Right and the Over-Subscription Right must be received by
the Subscription Agent at or before 5:00 p.m., New York City time, on the
Expiration Date and represents that such payment, in the aggregate amount of
$___________, either (check appropriate box):

        [ ]     is being delivered to the Subscription Agent herewith;

        or

        [ ]     has been delivered separately to the Subscription Agent in the
                manner set forth below (check appropriate box and complete
                information relating thereto):

        [ ]     Wire transfer of funds

                Name of transferor institution: _______________________________

                Date of transfer: _______________________________

                Confirmation number (if available):_____________________________

        [ ]     Uncertified check (Payment by uncertified check will not be
                deemed to have been received by the Subscription Agent until
                such check has cleared. Holders paying by such means are urged
                to make payment sufficiently in advance of the Expiration Date
                to ensure that such payment clears by such date.)

        [ ]     Certified check

        [ ]     Bank draft (cashier's check)

                                       A-1

<PAGE>

        [ ]     Money order

                Name of maker: _______________________________

                Date of check, draft or money order:____________________________

                Check, draft or money order number:-____________________________

                Bank or other institution on which check is drawn or issuer of
                money order: _______________________________

Signature(s)


___________________________

Name(s)


___________________________
(PLEASE TYPE OR PRINT)

ADDRESS


___________________________
___________________________
___________________________
___________________________
Area Code and Tel. No.(s)


Subscription Rights Certificates No(s). (if available)


___________________________

<PAGE>

                              GUARANTEE OF DELIVERY
    (NOT TO BE USED FOR SUBSCRIPTION RIGHTS CERTIFICATE SIGNATURE GUARANTEE)

        The undersigned, a member firm of a registered national securities
exchange or of the National Association of Securities Dealers Corporation, or a
commercial bank or trust company having an office or correspondent in the United
States, or a bank, stockbroker, savings and loan association or credit union
with membership in an approved signature guarantee medallion program, pursuant
to Rule 17Ad-15 of the Securities Exchange Act of 1934, as amended, guarantees
that the undersigned will deliver to the Subscription Agent the certificates
representing the Rights being exercised hereby, with any required signature
guarantee and any other required documents, all within three (3) business days
after the date hereof.


Dated:

_____________________


------------------------------------            --------------------------------
            (Address)                                   (Name of Firm)


------------------------------------            --------------------------------
  (Area Code and Telephone Number)                   (Authorized Signature)

        The institution that completes this form must communicate the guarantee
to the Subscription Agent and must deliver the Subscription Rights
Certificate(s) to the Subscription Agent within the time period shown in the
Prospectus of Velocity Express Corporation, dated ___________________, 2003.
Failure to do so could result in a financial loss to such institution.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>11
<FILENAME>dex992.txt
<DESCRIPTION>FORM OF NOTICE OF GUARANTEED DELIVERY
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.2

                          NOTICE OF GUARANTEED DELIVERY
                                       FOR
                     SUBSCRIPTION RIGHTS CERTIFICATES ISSUED
                         BY VELOCITY EXPRESS CORPORATION

        This form, or one substantially equivalent hereto, must be used to
exercise Rights pursuant to the Rights Offering described in the Prospectus
dated ___________________, 2003 (the "Prospectus") of Velocity Express
Corporation, a Delaware corporation (the "Company"), if a holder of Rights
cannot deliver the certificate(s) evidencing the Rights (the "Subscription
Rights Certificate(s)"), to the Subscription Agent listed below (the
"Subscription Agent") at or prior to 5:00 p.m., New York City time, on
___________________, 2003, unless such time is extended, or the Rights Offering
is terminated, each as may be determined by the Company as described in the
Prospectus (as it may be extended or terminated, the "Expiration Date"). Such
form must be delivered by hand or sent by telegram, facsimile transmission,
first class mail or overnight courier to the Subscription Agent, and must be
received by the Subscription Agent on or prior to the Expiration Date. See "The
Rights Offering--Method of Subscription--Exercise of Rights" in the Prospectus.
Payment of the Subscription Price of $2.20 per share for each share of the
Company's Series I Convertible Preferred Stock, par value $0.004 ("Series I
Preferred"), subscribed for upon exercise of such Rights must be received by the
Subscription Agent in the manner specified in "The Rights Offering--Method of
Payment" in the Prospectus at or prior to 5:00 p.m., New York City time on the
Expiration Date even if the Subscription Rights Certificate(s) evidencing such
Rights is (are) being delivered pursuant to the Guaranteed Delivery Procedures
thereof. See "The Rights Offering--Method of Subscription--Exercise of Rights"
in the Prospectus.

                           The Subscription Agent is:

                     AMERICAN STOCK TRANSFER & TRUST COMPANY

       If by Mail or Telegram:               If by Hand or Overnight Courier:
American Stock Transfer & Trust Company  American Stock Transfer & Trust Company
           59 Maiden Lane                            59 Maiden Lane
         New York, NY 10038                        New York, NY 10038
        Confirm by Telephone:                    Facsimile Transmission:
          (800) 937-5449                            (718) 234-5001

        DELIVERY OR TRANSMISSION OF THIS INSTRUMENT OTHER THAN AS SET FORTH
ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.

        Questions may be answered by, and additional copies of relevant
documents may be obtained through contacting the Company's General Counsel and
Secretary, Wesley Fredenburg:

                          Velocity Express Corporation
                          7803 Glenroy Road, Suite 200
                          Minneapolis, Minnesota 55439
                                 (612) 492-2405

<PAGE>

Ladies and Gentlemen:

        The undersigned hereby represents that the undersigned is the holder of
Subscription Rights Certificate(s) representing ___________________ Rights and
that such Subscription Rights Certificate(s) cannot be delivered to the
Subscription Agent at or before 5:00 p.m., New York City time, on the Expiration
Date. Upon the terms and subject to the conditions set forth in the Prospectus,
receipt of which is hereby acknowledged, the undersigned hereby elects to
exercise (i) the Basic Subscription Right to subscribe for ________ share(s) of
Series I Preferred with respect to each of the Rights represented by such
Subscription Rights Certificate(s) and (ii) the Over-Subscription Right relating
to such Rights, to the extent that shares of Series I Preferred that are not
otherwise purchased pursuant to the exercise of the Basic Subscription Rights
(the "Excess Shares") are available therefor, for an aggregate of up to Excess
Shares, subject to availability and pro ration.

        The undersigned understands that payment of the Subscription Price of
$2.20 per share for each share of Series I Preferred subscribed for pursuant to
the Basic Subscription Right and the Over-Subscription Right must be received by
the Subscription Agent at or before 5:00 p.m., New York City time, on the
Expiration Date and represents that such payment, in the aggregate amount of
$___________, either (check appropriate box):

        [ ]     is being delivered to the Subscription Agent herewith;

        or

        [ ]     has been delivered separately to the Subscription Agent in the
                manner set forth below (check appropriate box and complete
                information relating thereto):

        [ ]     Wire transfer of funds

                Name of transferor institution: _______________________________

                Date of transfer: _______________________________

                Confirmation number (if available):_____________________________

        [ ]     Uncertified check (Payment by uncertified check will not be
                deemed to have been received by the Subscription Agent until
                such check has cleared. Holders paying by such means are urged
                to make payment sufficiently in advance of the Expiration Date
                to ensure that such payment clears by such date.)

        [ ]     Certified check

        [ ]     Bank draft (cashier's check)

<PAGE>

        [ ]     Money order

                Name of maker: _______________________________

                Date of check, draft or money order:____________________________

                Check, draft or money order number:-____________________________

                Bank or other institution on which check is drawn or issuer of
                money order: _______________________________

Signature(s)


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

Name(s)


---------------------------
(PLEASE TYPE OR PRINT)

ADDRESS

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

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

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

---------------------------
Area Code and Tel. No.(s)


Subscription Rights Certificates No(s). (if available)


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

<PAGE>

                              GUARANTEE OF DELIVERY
    (NOT TO BE USED FOR SUBSCRIPTION RIGHTS CERTIFICATE SIGNATURE GUARANTEE)

        The undersigned, a member firm of a registered national securities
exchange or of the National Association of Securities Dealers Corporation, or a
commercial bank or trust company having an office or correspondent in the United
States, or a bank, stockbroker, savings and loan association or credit union
with membership in an approved signature guarantee medallion program, pursuant
to Rule 17Ad-15 of the Securities Exchange Act of 1934, as amended, guarantees
that the undersigned will deliver to the Subscription Agent the certificates
representing the Rights being exercised hereby, with any required signature
guarantee and any other required documents, all within three (3) business days
after the date hereof.


Dated:

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


------------------------------------            --------------------------------
            (Address)                                    (Name of Firm)


------------------------------------            --------------------------------
  (Area Code and Telephone Number)                   (Authorized Signature)

        The institution that completes this form must communicate the guarantee
to the Subscription Agent and must deliver the Subscription Rights
Certificate(s) to the Subscription Agent within the time period shown in the
Prospectus of Velocity Express Corporation, dated ___________________, 2003.
Failure to do so could result in a financial loss to such institution.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>12
<FILENAME>dex993.txt
<DESCRIPTION>FORM OF LETTER TO STOCKHOLDERS WHO ARE RECORDHOLDERS
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.3

                          VELOCITY EXPRESS CORPORATION

                 SHARES OF SERIES I CONVERTIBLE PREFERRED STOCK

  OFFERED PURSUANT TO RIGHTS DISTRIBUTED TO STOCKHOLDERS OF RECORD OF VELOCITY
                               EXPRESS CORPORATION

                               September __, 2003

Dear Stockholder:

        This notice is being distributed by Velocity Express Corporation, a
Delaware corporation (the "Company") to all holders of record of shares of its
Common Stock, Series B Convertible Preferred Stock, Series C Convertible
Preferred Stock, Series D Convertible Preferred Stock, Series F Convertible
Preferred Stock, Series G Convertible Preferred Stock and Series H Convertible
Preferred Stock at the close of business on September 11, 2003 (the "Record
Date"), in connection with a distribution in a rights offering (the "Rights
Offering") of subscription rights (the "Rights") to subscribe for and purchase
shares of its Series I Convertible Preferred Stock, par value $0.004 per share
("Series I Preferred"). The Rights are described in detail in the Company's
Prospectus dated __________, 2003 (the "Prospectus") which is attached.

        In the Rights Offering, the Company is offering an aggregate of up to
8,409,091 shares of its Series I Preferred (the "Underlying Shares"), as
described in the Prospectus.

        The Rights will expire, if not exercised, at 5:00 p.m., New York City
time, on __________, 2003, unless extended in the sole discretion of the Company
(as it may be extended, the "Expiration Date").

        As described in the accompanying Prospectus, holders of our Common Stock
will receive 0.297952777 Right for every share of Common Stock held on the
Record Date. Holders of our Series B Preferred Stock will receive 0.486231363
Rights for each share of Series B Preferred Stock held on the Record Date;
holders of our Series C Preferred Stock will receive 0.329810541 Rights for each
share of Series C Preferred Stock held on the Record Date; holders of our Series
D Preferred Stock will receive 0.813565586 Rights for each share of Series D
Preferred Stock held on the Record Date; holders of our Series F Preferred Stock
will receive 1.745371947 Rights for each share of Series F Preferred Stock held
on the Record Date; holders of our Series G Preferred Stock will receive
0.072517623 Rights for each share of Series G Preferred Stock held on the Record
Date; and holders of Series H Preferred Stock will receive 2.979527767 Rights
for each share of Series H Preferred Stock held on the Record Date.

        Each Right will entitle you to subscribe for one share of the Series I
Preferred (the "Basic Subscription Right") at a subscription price of $2.20 per
share (the "Subscription Price").

<PAGE>

        In addition, each holder of Rights who exercises their Basic
Subscription Right in full will be eligible to subscribe (the "Over-Subscription
Right") at the Subscription Price for shares of Series I Preferred that are not
otherwise purchased pursuant to the exercise of Rights under the Basic
Subscription Right (the "Excess Shares"), subject to availability and pro ration
as described below. Each holder of Rights may only exercise their
Over-Subscription Right if he/she exercised his/her Basic Subscription Right in
full and other holders of subscription Rights do not exercise their Basic
Subscription Rights in full. If there are not enough Excess Shares to satisfy
all subscriptions made under the Over-Subscription Right, the Company will
allocate the remaining Excess Shares pro rata, after eliminating all fractional
shares, among those Rights holders who exercised their Over-Subscription Rights.
"Pro rata" means in proportion to the amount of over-subscription price tendered
by each person seeking to exercise their Over-Subscription Right as of the
expiration date of the Rights Offering. If there is a pro rata allocation of the
remaining Excess Shares and a holder of Rights receives an allocation of a
greater number of Excess Shares than he/she subscribed for under their
Over-Subscription Right, then the Company will allocate to them only the number
of Excess Shares for which they subscribed. The Company will allocate the
remaining Excess Shares among all other holders exercising their
Over-Subscription Rights. See "The Rights Offering --Subscription Rights" in the
Prospectus.

        The Rights will be evidenced by nontransferable Rights certificates (the
"Subscription Rights Certificates") and will be null and void and cease to have
value at 5:00 p.m., New York City time, on the Expiration Date.

        Enclosed are copies of the following documents:

                1.      Prospectus;

                2.      Subscription Rights Certificate;

                3.      Instructions for Use of Velocity Express Subscription
                        Rights Certificates (including a Notice of Guaranteed
                        Delivery for Subscription Rights Certificates Issued by
                        Velocity Express Corporation); and

                4.      A return envelope addressed to American Stock Transfer &
                        Trust Company, the Subscription Agent.

        Your prompt action is requested. To exercise the Rights, you should
properly complete and sign the Subscription Rights Certificate (or the Notice of
Guaranteed Delivery if you are following the Guaranteed Delivery Procedures) and
forward it, with payment of the Subscription Price in full for each share
subscribed for pursuant to the Basic Subscription Right and the
Over-Subscription Right, to the Subscription Agent, as indicated in the
Prospectus. The Subscription Agent must receive the Subscription Rights
Certificate or Notice of Guaranteed Delivery with payment of the Subscription
Price, including final clearance of any checks, prior to 5:00 p.m., New York
City time, on the Expiration Date.

        A RIGHTS HOLDER CANNOT REVOKE THE EXERCISE OF ITS RIGHTS. RIGHTS NOT
EXERCISED PRIOR TO THE EXPIRATION DATE WILL EXPIRE.

<PAGE>

        Additional copies of the enclosed materials may be obtained from the
Company by calling (612) 492-2400.


                                           Very truly yours,


                                           VELOCITY EXPRESS CORPORATION

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.4
<SEQUENCE>13
<FILENAME>dex994.txt
<DESCRIPTION>FORM OF LETTER TO STOCKHOLDERS WHO ARE NOT BENEFICIAL OWNERS
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.4

                          VELOCITY EXPRESS CORPORATION

                 SHARES OF SERIES I CONVERTIBLE PREFERRED STOCK

  OFFERED PURSUANT TO RIGHTS DISTRIBUTED TO STOCKHOLDERS OF RECORD OF VELOCITY
                               EXPRESS CORPORATION

                               SEPTEMBER __, 2003

To Securities Dealers, Commercial Banks,
Trust Companies and Other Nominees:

        This letter is being distributed to securities dealers, commercial
banks, trust companies and other nominees in connection with the rights offering
(the "Rights Offering") by Velocity Express Corporation, a Delaware corporation
(the "Company") of subscription rights ("Rights") distributed to all of the
Company's holders of record ("Record Holders") to subscribe for and purchase
shares of its Series I Convertible Preferred Stock, par value $0.004 per share
("Series I Preferred"). The Rights are described in detail in the Company's
Prospectus dated September __, 2003 (the "Prospectus") which is attached.

        In the Rights Offering, the Company is offering an aggregate of up to
8,409,091 shares of its Series I Preferred (the "Underlying Shares"), as
described in the Prospectus.

        The Rights will expire, if not exercised, at 5:00 p.m., New York City
time, on __________, 2003, unless extended in the sole discretion of the Company
(as it may be extended, the "Expiration Date").

        As described in the accompanying Prospectus, holders or beneficial
holders of our Common Stock will receive 0.297952777 Right for every share of
Common Stock held on the Record Date. Each Right will entitle the beneficial
owner of shares of Common Stock registered in your name or the name of your
nominee to subscribe for one share of the Series I Preferred (the "Basic
Subscription Right") at a subscription price of $2.20 per share (the
"Subscription Price").

        In addition, each holder or beneficial holder of Rights who exercises
their Basic Subscription Right in full will be eligible to subscribe (the
"Over-Subscription Right") at the Subscription Price for shares of Series I
Preferred that are not otherwise purchased pursuant to the exercise of Rights
under the Basic Subscription Right (the "Excess Shares"), subject to
availability and pro ration as described below. Each holder or beneficial holder
of Rights may only exercise their Over-Subscription Right if he/she exercised
his/her Basic Subscription Right in full and other holders of Subscription
Rights do not exercise their Basic Subscription Rights in full. If there are not
enough Excess Shares to satisfy all subscriptions made under the
Over-Subscription Right, the Company will allocate the remaining Excess Shares
pro rata, after eliminating all fractional shares, among those Rights holders
who exercised their Over-

<PAGE>

Subscription Rights. "Pro rata" means in proportion to the amount of
over-subscription price tendered by each person seeking to exercise their
Over-Subscription Right as of the expiration date of the Rights Offering. If
there is a pro rata allocation of the remaining Excess Shares and a holder or
beneficial holder of Rights receives an allocation of a greater number of Excess
Shares than he/she subscribed for under their Over-Subscription Right, then the
Company will allocate to them only the number of Excess Shares for which they
subscribed. The Company will allocate the remaining Excess Shares among all
other holders exercising their Over-Subscription Rights. See "The Rights
Offering --Subscription Rights" in the Prospectus.

        The Rights will be evidenced by nontransferable Rights certificates (the
"Subscription Rights Certificates") registered in your name or the name of your
nominee and will be null and void and cease to have value at 5:00 p.m., New York
City time, on the Expiration Date.

        We are asking persons who hold shares of Common Stock beneficially and
who have received the Rights distributable with respect to those shares through
a broker, dealer, commercial bank, trust company or other nominee, as well as
persons who hold certificates of the Company's capital stock directly and prefer
to have such institutions effect transactions relating to the Rights on their
behalf, to contact the appropriate institution or nominee and request it to
effect the transactions for them.

        If you exercise the Over-Subscription Right on behalf of beneficial
owners of the Rights, you will be required to certify to the Subscription Agent
and the Company, in connection with the exercise of the Over-Subscription Right,
as to the aggregate number of Rights that have been exercised pursuant to the
Basic Subscription Right, whether the Basic Subscription Right of each
beneficial owner of Rights on whose behalf you are acting has been exercised in
full, and the number of shares of Series I Preferred being subscribed for
pursuant to the Over-Subscription Right by each beneficial owner of Rights on
whose behalf you are acting.

        All commissions, fees and other expenses (including brokerage
commissions and transfer taxes), other than fees and expenses of the
Subscription Agent, incurred in connection with the exercise of the Rights will
be for the account of the holder of the Rights, and none of such commissions,
fees or expenses will be paid by the Company or the Subscription Agent.

        Enclosed are copies of the following documents:

                1.      Prospectus;

                2.      Instructions for Use of Velocity Express Subscription
                        Rights Certificates;

                3.      A form of letter which may be sent to your clients for
                        whose accounts you hold shares of Common Stock
                        registered in your name or the name of your nominee,
                        with an attached form of instruction;

                4.      Notice of Guaranteed Delivery for Subscription Rights
                        Certificates Issued by Velocity Express Corporation;

                5.      Nominee Holder Certification; and

                6.      A return envelope addressed to American Stock Transfer &
                        Trust Company, the Subscription Agent.

<PAGE>

        Your prompt action is requested. To exercise Rights, you should deliver
the properly completed and signed Subscription Rights Certificate (or the Notice
of Guaranteed Delivery if you are following the Guaranteed Delivery Procedures),
with payment of the Subscription Price in full for each share of Series I
Preferred subscribed for, to the Subscription Agent, as indicated in the
Prospectus. The Subscription Agent must receive the Subscription Rights
Certificate or Notice of Guaranteed Delivery with payment of the Subscription
Price, including final clearance of any checks, prior to 5:00 p.m., New York
City time, on the Expiration Date.

        A RIGHTS HOLDER CANNOT REVOKE THE EXERCISE OF ITS RIGHTS. RIGHTS NOT
EXERCISED PRIOR TO THE EXPIRATION DATE WILL EXPIRE.

        Additional copies of the enclosed materials may be obtained from the
Company by calling (612) 492-2400.


                                        Very truly yours,


                                        VELOCITY EXPRESS CORPORATION

NOTHING IN THIS LETTER OR IN THE ENCLOSED DOCUMENTS SHALL RENDER YOU OR ANY
PERSON AS AN AGENT OF VELOCITY EXPRESS CORPORATION, THE SUBSCRIPTION AGENT OR
ANY OTHER PERSON MAKING OR DEEMED TO BE MAKING OFFERS OF THE SECURITIES ISSUABLE
UPON VALID EXERCISE OF THE RIGHTS, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE
ANY STATEMENTS ON BEHALF OF ANY OF THEM WITH RESPECT TO THE OFFERING EXCEPT FOR
STATEMENTS EXPRESSLY MADE IN THE PROSPECTUS.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.5
<SEQUENCE>14
<FILENAME>dex995.txt
<DESCRIPTION>FORM OF LETTER TO CLIENTS OF STOCKHOLDERS WHO ARE NOT BENEFICIAL OWNERS
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.5

                          VELOCITY EXPRESS CORPORATION

                 SHARES OF SERIES I CONVERTIBLE PREFERRED STOCK

  OFFERED PURSUANT TO RIGHTS DISTRIBUTED TO STOCKHOLDERS OF RECORD OF VELOCITY
                               EXPRESS CORPORATION

                               SEPTEMBER __, 2003


To Our Clients:

        Enclosed for your consideration is a Prospectus, dated September __,
2003 (the "Prospectus"), and the "Instructions for Use of Velocity Express
Subscription Rights Certificates" relating to the offering (the "Rights
Offering") by Velocity Express Corporation (the "Company") of subscription
rights ("Rights") distributed to all of the Company's holders of record ("Record
Holders") to subscribe for and purchase shares of its Series I Convertible
Preferred Stock, par value $0.004 per share ("Series I Preferred"). The Rights
are described in detail in the Company's Prospectus dated September __, 2003
(the "Prospectus") which is attached.

        In the Rights Offering, the Company is offering an aggregate of up to
8,409,091 shares of its Series I Preferred (the "Underlying Shares"), as
described in the Prospectus.

        The Rights will expire, if not exercised, at 5:00 p.m., New York City
time, on __________, 2003, unless extended in the sole discretion of the Company
(as it may be extended, the "Expiration Date").

        As described in the accompanying Prospectus, you will receive
0.297952777 Right for every share of Common Stock held on the Record Date. Each
Right will entitle you to subscribe for one share of the Series I Preferred (the
"Basic Subscription Right") at a subscription price of $2.20 per share (the
"Subscription Price").

        In addition, each holder or beneficial holder of Rights who exercises
their Basic Subscription Right in full will be eligible to subscribe (the
"Over-Subscription Right") at the Subscription Price for shares of Series I
Preferred that are not otherwise purchased pursuant to the exercise of Rights
under the Basic Subscription Right (the "Excess Shares"), subject to
availability and pro ration as described below. Each holder or beneficial holder
of Rights may only exercise their Over-Subscription Right if he/she exercised
his/her Basic Subscription Right in full and other holders of subscription
Rights do not exercise their Basic Subscription Rights in full. If there are not
enough Excess Shares to satisfy all subscriptions made under the
Over-Subscription Right, the Company will allocate the remaining Excess Shares
pro rata, after eliminating all fractional shares, among those Rights holders
who exercised their Over-Subscription Rights. "Pro rata" means in proportion to
the amount of over-subscription price tendered by each person seeking to
exercise their Over-Subscription Right as of the expiration

<PAGE>

date of the Rights Offering. If there is a pro rata allocation of the remaining
Excess Shares and a holder of Rights receives an allocation of a greater number
of Excess Shares than he/she subscribed for under their Over-Subscription Right,
then the Company will allocate to them only the number of Excess Shares for
which they subscribed. The Company will allocate the remaining Excess Shares
among all other holders exercising their Over-Subscription Rights. See "The
Rights Offering --Subscription Rights" in the Prospectus.

        The Rights will be evidenced by nontransferable Rights certificates (the
"Subscription Rights Certificates") registered in your name or the name of your
nominee and will be null and void and cease to have value at 5:00 p.m., New York
City time, on the Expiration Date.

        The materials enclosed are being forwarded to you as the beneficial
owner of the Common Stock carried by us in your account but not registered in
your name. Exercises of Rights may be made only by us as the record owner and
pursuant to your instructions. Accordingly, we request instructions as to
whether you wish us to elect to subscribe for any shares of the Series I
Preferred to which you are entitled pursuant to the terms and subject to the
conditions set forth in the enclosed Prospectus. However, we urge you to read
the Prospectus and other enclosed materials carefully before instructing us to
exercise your Rights.

        Your instructions to us should be forwarded as promptly as possible in
order to permit us to exercise Rights on your behalf in accordance with the
provisions of the Rights Offering. The Rights Offering will expire at 5:00 p.m.,
New York City time, on the Expiration Date. Once you have exercised your Basic
Subscription Right and your Over-Subscription Right, such exercise may not be
revoked.

        If you wish to have us, on your behalf, exercise the Rights for any
shares of the Series I Preferred to which you are entitled, please so instruct
us by completing, executing and returning to us the instruction form on the
reverse side of this letter.

        ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE RIGHTS OFFERING
SHOULD BE DIRECTED TO THE GENERAL COUNSEL OF THE COMPANY AT (612) 492-2400.

<PAGE>

                         BENEFICIAL OWNER ELECTION FORM

                                  INSTRUCTIONS

        The undersigned acknowledge(s) receipt of your letter and the enclosed
materials referred to therein relating to the offering (the "Rights Offering")
by Velocity Express Corporation (the "Company") of subscription rights
("Rights") distributed to all of the Company's holders of record ("Record
Holders") to subscribe for and purchase shares of its Series I Convertible
Preferred Stock, par value $0.004 per share ("Series I Preferred"). The Rights
are described in detail in the Company's Prospectus dated September __, 2003
(the "Prospectus") which is attached.

        This will instruct you whether to exercise Rights to purchase shares of
the Company's Series I Preferred with respect to the Company's Common Stock held
by you for the account of the undersigned, pursuant to the terms and subject to
the conditions set forth in the Prospectus and the related "Instructions for Use
of Velocity Express Subscription Rights Certificates."

<PAGE>

   Box 1.    [ ]     Please DO NOT EXERCISE RIGHTS for shares of Series I
                     Convertible Preferred Stock.

   Box 2.    [ ]     Please EXERCISE RIGHTS for shares of Series I Convertible
                     Preferred Stock as set forth below.

<TABLE>
<CAPTION>
                                  NUMBER           SUBSCRIPTION
                                OF RIGHTS             PRICE                     PAYMENT
                                ---------             -----                     -------
<S>                             <C>                   <C>               <C>
Basic Subscription Right:                     X       $2.20          =  $ ________ (Line 1)
Over-Subscription Right:                      X       $2.20          =  $ ________ (Line 2)
                                Total Payment                        =  $ ________ (Sum of Lines 1
                                     Required                           and 2; must equal total of
                                                                        amounts in Boxes 3 and 4.)
</TABLE>

   Box 3.    [ ]     Payment in the following amount is enclosed $________.

   Box 4.    [ ]     Please deduct payment from the following account maintained
                     by you as follows:


   __________________                 _______________________
   Type of Account                    Account No.

   Amount to be deducted:  $________

                                         SIGNATURE(S)
                                         Please type or print name(s) below:

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

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

Date:  __________, 2003

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.6
<SEQUENCE>15
<FILENAME>dex996.txt
<DESCRIPTION>FORM OF NOMINEE HOLDER CERTIFICATION
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.6

                          VELOCITY EXPRESS CORPORATION

                          NOMINEE HOLDER CERTIFICATION

        The undersigned, a bank, broker, trustee, depositary or other nominee of
subscription rights (the "Rights") to subscribe for and purchase shares of
Velocity Express Corporation's Series I Convertible Preferred Stock, par value
$0.004 per share ("Series I Preferred") pursuant to the rights offering (the
"Rights Offering") described in Velocity Express Corporation's prospectus dated,
____________, 2003, (the "Prospectus"), hereby certifies to Velocity Express
Corporation and to American Stock Transfer & Trust Company, as Subscription
Agent for the Rights Offering, that (1) the undersigned has exercised, on behalf
of the beneficial owners thereof (which may include the undersigned), the number
of Rights specified below pursuant to the Basic Subscription Right (as defined
in the Prospectus) of beneficial owners of Rights who have subscribed for the
purchase of additional shares of Series I Preferred pursuant to the
Over-Subscription Right (as defined in the Prospectus), listing separately below
each such exercised Basic Subscription Right and the corresponding
Over-Subscription Right (without identifying any such beneficial owner), and (2)
each such beneficial owner's Basic Subscription Right has been exercised in
full:

<TABLE>
<CAPTION>
            Number Of            Rights Exercised        Number Of Shares Subscribed
          Shares Owned          Pursuant To Basic           For Pursuant To Over-
       On The Record Date       Subscription Right            Subscription Right
   ------------------------  -----------------------  ------------------------------
<S>                          <C>                      <C>
1.
   ------------------------  -----------------------  ------------------------------
2.
   ------------------------  -----------------------  ------------------------------
3.
   ------------------------  -----------------------  ------------------------------
4.
   ------------------------  -----------------------  ------------------------------
5.
   ------------------------  -----------------------  ------------------------------
6.
   ------------------------  -----------------------  ------------------------------
7.
   ------------------------  -----------------------  ------------------------------
8.
   ------------------------  -----------------------  ------------------------------
9.
   ------------------------  -----------------------  ------------------------------
</TABLE>

<PAGE>

Provide the following information if applicable:


_____________________________________
Depository Trust Company ("DTC")
Participant Number

By:
   -------------------------------
Name:
Title:

_____________________________________
DTC Basic Subscription Confirmation
Number(s)

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.7
<SEQUENCE>16
<FILENAME>dex997.txt
<DESCRIPTION>FORM OF BENEFICIAL OWNER ELECTION FORM
<TEXT>
<PAGE>

                                                                    EXHIBIT 99.7

                         BENEFICIAL OWNER ELECTION FORM

                                  INSTRUCTIONS

        The undersigned acknowledge(s) receipt of your letter and the enclosed
materials referred to therein relating to the offering (the "Rights Offering")
by Velocity Express Corporation (the "Company") of subscription rights
("Rights") distributed to all of the Company's holders of record ("Record
Holders") to subscribe for and purchase shares of its Series I Convertible
Preferred Stock, par value $0.004 per share ("Series I Preferred"). The Rights
are described in detail in the Company's Prospectus dated September __, 2003
(the "Prospectus") which is attached.

        This will instruct you whether to exercise Rights to purchase shares of
the Company's Series I Preferred with respect to the Company's Common Stock held
by you for the account of the undersigned, pursuant to the terms and subject to
the conditions set forth in the Prospectus and the related "Instructions for Use
of Velocity Express Subscription Rights Certificates."

<PAGE>

   Box 1.    [ ]     Please DO NOT EXERCISE RIGHTS for shares of Series I
                     Convertible Preferred Stock.

   Box 2.    [ ]     Please EXERCISE RIGHTS for shares of Series I Convertible
                     Preferred Stock as set forth below.

<TABLE>
<CAPTION>
                                  NUMBER           SUBSCRIPTION
                                OF RIGHTS             PRICE                     PAYMENT
                                ---------             -----                     -------
<S>                             <C>                   <C>               <C>
Basic Subscription Right:                     X       $2.20          =  $ ________ (Line 1)
Over-Subscription Right:                      X       $2.20          =  $ ________ (Line 2)
                                Total Payment                        =  $ ________ (Sum of Lines 1
                                     Required                           and 2; must equal total of
                                                                        amounts in Boxes 3 and 4.)
</TABLE>

   Box 3.    [ ]     Payment in the following amount is enclosed $________.

   Box 4.    [ ]     Please deduct payment from the following account maintained
                     by you as follows:

   __________________                 _______________________
   Type of Account                    Account No.

   Amount to be deducted:  $________

                                             SIGNATURE(S)
                                             Please type or print name(s) below:


   Date:  __________, 2003

</TEXT>
</DOCUMENT>
</SUBMISSION>
