UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549


                                   FORM 8-K/A
                                 AMENDMENT NO. 1
                                 CURRENT REPORT


     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of earliest event reported): December 5, 2003
                                                  (April 25, 2003)


                                   PACEL CORP.
--------------------------------------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)


           Virginia                     000-31935                54-171-2558
----------------------------       ----------------       ----------------------
(State or other jurisdiction       (Commission            (IRS Employer
   of incorporation)                   file number)          Identification No.)

7900 Sudley Road, Suite 619
Manassas, Virginia                                               20109
--------------------------------------                  ------------------------
(Address of principal executive offices)                        (Zip Code)

Registrant's telephone number, including area code: (703) 257-4759

                                       N/A
                      ------------------------------------
          (Former name or former address, if changes since last report)

Copy of Communications to:
                               Donald F. Mintmire
                               Mintmire & Associates
                               265 Sunrise Avenue, Suite 204
                               Palm Beach, FL 33480
                               Phone: (561) 832-5696
                               Fax: (561) 659-5371






Filed herewith are the financial statements and pro forma financial  information
required  to be  filed by Item 7 of Form 8-K in  connection  with the  Company's
acquisition of all of the assets of Asmara, Inc. ("Asmara"), including the stock
of its wholly-owned  subsidiaries and the stock of Woodstock Lumber Sales, Inc.,
an affiliated company, as reported in the Current Report on Form 8-K, filed with
the Commission on June 13, 2003, to which this Amendment No. 1 relates:

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits

(a)  Financial Statements of Business Acquired

Report of Independent Accountants                                            F-1

Combined Balance Sheet of Asmara, Inc., its subsidiaries and
affiliates at December 31, 2002                                              F-2

Combined Statement of Operations and Accumulated  Deficit of
Asmara,  Inc., its  subsidiaries and affiliates for the year
ended December 31, 2002                                                      F-3

Combined  Statement  of Cash  Flows  of  Asmara,  Inc.,  its
subsidiaries  and affiliates for the year ended December 31,
2002                                                                         F-4

Notes to Combined Financial  Statements of Asmara, Inc., its
subsidiaries  and affiliates for the year ended December 31,
2002                                                                         F-5

Combined Balance Sheet of Asmara, Inc., its subsidiaries and
affiliates as of September 30, 2003 (Unaudited)                              F-

Combined  Statement  of  Operations  of  Asmara,  Inc.,  its
subsidiaries  and  affiliates  for  the  nine  months  ended
September 30, 2003 (Unaudited)                                               F-


(b)  Pro Forma Financial Information

Introduction to Unaudited Pro Forma  Condensed  Consolidated
Financial Information                                                       F-17

Unaudited  Pro Forma  Condensed  Consolidated  Statement  of
Operations  for Pacel  Corp.  and Asmara for the nine months
ended September 30, 2003                                                    F-19

Unaudited  Pro Forma  Condensed  Consolidated  Statement  of
Operations  for Pacel  Corp.  and  Asmara for the year ended
December 31, 2002.                                                          F-20

Notes  to  Unaudited   Pro  Forma   Condensed   Consolidated
Financial Information                                                       F-22


(c) Exhibits

Exhibit No.    Description
------------   ----------------------------------------------------------
10.1    *      LEASE  AGREEMENT  between W. Revel Bellamy,  Natalie  Bellamy and
               Asmara, Inc., dated January 1, 2003

                                                                               2





                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.


Date:  December 5, 2003


                                   PACEL CORP.

/s/David E. Calkins
---------------------------------------------
David E. Calkins, President, CEO and Chairman












                                                                               3





                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To The Board of Directors and Stockholders
Asmara, Inc. and Affiliates

We have audited the  accompanying  combined  balance  sheet of Asmara,  Inc. and
affiliates  as of  December  31,  2002 and the related  combined  statements  of
operations and accumulated deficit and cash flows for the year then ended. These
combined   financial   statements  are  the   responsibility  of  the  Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance about whether the combined  financial  statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the combined financial statements.  An audit also
includes assessing the accounting principles used and significant estimates made
by  management,   as  well  as  evaluating  the  overall   financial   statement
presentation.  We believe  that our audit  provides a  reasonable  basis for our
opinion.

In our opinion,  the combined  financial  statements  referred to above  present
fairly, in all material  respects,  the financial  position of Asmara,  Inc. and
affiliates  as of December  31, 2002 and results of their  operations  and their
cash  flows  for the year  then  ended in  conformity  with  generally  accepted
accounting principles.


                                                    /s/Faulkner & Thompson, P.A.
                                                       Faulkner & Thompson, P.A.


226 Northpark Drive, Suite 110
Rock Hill, SC 29730

November 18, 2003

                                                                             F-1






                           Asmara, Inc. and Affiliates
                             Combined Balance Sheet
                                December 31, 2002
                                                                
         ASSETS

Current Assets:
       Accounts receivable                                         $    21,547
       Due from related party                                          408,455
       Workers compensation insurance deposit                          138,928
                                                                       568,930
                                                                   -----------
Property and equipment, net of accumulated depreciation                 50,727
                                                                   -----------
Other Assets:
       Goodwill 99,900
       Other assets                                                      7,618
                                                                       107,518
                                                                   -----------
                Total assets                                       $   727,175
                                                                   ===========

        LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current Liabilities:
       Accounts payable and accrued expenses                       $   114,078
       Payroll tax and payroll related liabilities                   1,192,732
       Deferred client revenue                                          14,952
       Due to related party                                            431,531
       Note payable                                                     52,906
       Capital lease obligation                                         22,846
                                                                   -----------
                Total current liabilities                            1,829,045
                                                                   -----------
Capital lease obligation, net of current portion                        15,351
                                                                   -----------
Stockholders Equity (Deficit):
Common stock    11,250
Additional paid-in capital                                              75,000
Accumulated deficit                                                 (1,203,471)
                                                                   -----------
                Total stockholders' deficit                         (1,117,221)
                                                                   -----------
                Total liabilities and stockholders' equity         $   727,175
                                                                   ===========


                   See Notes to Combined Financial Statements.

                                                                             F-2






                           Asmara, Inc. and Affiliates
            Combined Statement of Operations and Accumulated Deficit
                      For the year ended December 31, 2002


                                                                
Revenue                                                            $  4,057,317
Cost of sales                                                         2,870,845
                                                                   ------------
       Gross profit                                                   1,186,472

Operating costs and expenses:
       Depreciation and amortization                                     19,800
       Interest expense                                                  17,486
       Sales, general and administrative expenses                     1,377,006
                                                                   ------------
                Total operating costs and expenses                    1,414,292
                                                                   ------------
                Net loss from operations                               (227,820)
                                                                   ------------
Other expense:
       Write off of related party receivable                           (597,060)
                                                                   ------------
                Net loss                                           $   (824,880)

       Accumulated deficit, beginning of year                          (378,591)
                                                                   ------------
       Accumulated deficit, end of year                            $ (1,203,471)
                                                                   ============


                   See Notes to Combined Financial Statements.

                                                                             F-3






                           Asmara, Inc. and Affiliates
                        Combined Statement of Cash Flows
                      For the year ended December 31, 2002

                                                                
Cash flows from operating activities:
       Net loss $  (824,880)
       Adjustments to reconcile net loss to net
           cash provided by operating activities:
           Depreciation and amortization                           $     19,800
           Bad debts                                                    597,060
           Changes in assets and liabilities:
                Accounts receivable                                      22,525
                Workers compensation deposits                            (4,125)
                Other assets                                             (2,639)
                Accounts payable                                          6,426
                Payroll taxes and payroll related liabilities           585,471
                Deferred revenue                                         14,952
                Due to/from related parties                            (229,810)
                                                                   ------------
           Net cash provided by operating activities                    184,780
                                                                   ------------
Cash flows from investing activities:
       Investment in subsidiaries                                        (2,500)
       Purchase of equipment                                            (13,196)
       Purchase of goodwill                                             (99,900)
                                                                   ------------
           Net cash used in investing activities                       (115,596)
                                                                   ------------
Cash flows from financing activities:
       Principal payments on note payable                               (61,350)
       Principal payments on capital lease obligation                    (7,834)
           Net cash used in financing activities                        (69,184)

           Net increase in cash and cash equivalents                         -0-
                                                                   ------------
           Cash and cash equivalents, beginning of year                      -0-

Cash and cash equivalents, end of year                             $         -0-
                                                                   ============
Supplemental disclosures of cash flow information:
       Cash paid during the year for interest                      $     17,486
                                                                   ============
       Non-cash investing and financing activities:

           Purchase of equipment under capital lease obligation    $     46,031
                                                                   ============


                   See Notes to Combined Financial Statements.

                                                                             F-4




                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

Asmara,  Inc.  was  incorporated  in the State of North  Carolina in 1997 and is
engaged in business as a professional employer  organization (PEO),  providing a
broad  range  of  human  resource  functions   including  payroll  and  benefits
administration,  health and workers'  compensation  insurance,  as well as other
personnel services to employers in North Carolina and surrounding states.

Woodstock   Lumber  Sales,   Inc.  (dba  Partners  PEO  of  the  Carolinas)  was
incorporated  in the State of Oklahoma in 1983 and is engaged as a  professional
employer  organization,  providing  a broad  range of human  resource  functions
including payroll and benefits administration,  health and workers' compensation
insurance,  as well as other personnel services to employers  primarily in South
Carolina and Oklahoma.

Able, Inc.  primarily provided  administrative  services to the other affiliated
companies in 2002 and it was administratively dissolved in 2002.

Related  Components,  Inc. was  incorporated  in the State of North  Carolina in
October 1993 and was engaged in business as a professional employer organization
(PEO) as well.  The company was in the process of being  dissolved at the end of
2002.

Asmara of Florida I, Inc. (formerly known as The Hood Company of Gainesville and
Accredited  Solutions I, Inc.) was  incorporated in the State of Florida in 1981
and is engaged in the business as a professional  employer  organization  (PEO),
providing a broad range of human  resources  functions  to  employers in Central
Florida.

Asmara of Florida II, Inc.  (formerly  known as Accredited  Solutions II, Inc.),
Asmara of Florida III, Inc. (formerly known as Accredited  Solutions III, Inc.),
and Asmara of Florida IV, Inc. (formerly known as Accredited Solutions IV, Inc.)
were incorporated June 2001 in the State of Florida.  These companies operate as
professional  employer  organizations  providing a broad range of human resource
functions to employers in Central Florida.

During December 2002, the outstanding common stock of Asmara of Florida I, Inc.,
Asmara of Florida II, Inc.,  Asmara of Florida III,  Inc., and Asmara of Florida
IV,  Inc.  was  purchased  by Asmara,  Inc.  See Note 5 for  additional  details
regarding the purchase.

These affiliated  companies are reported  separately for income tax purposes and
combined for financial reporting purposes.

                                                                             F-5



                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002

Principles of Combination

The accompanying  combined financial  statements include the accounts of Asmara,
Inc.  (including its subsidiaries:  Asmara of Florida I, Inc., Asmara of Florida
II, Inc.,  Asmara of Florida III, Inc., and Asmara of Florida IV, Inc.), as well
as Woodstock Lumber Sales,  Inc., Able, Inc. and Related  Components,  Inc. (the
"Company"). These entities are related through common ownership and control.

Principles of Consolidation

The combined financial  statements include the accounts of Asmara,  Inc. and its
wholly  owned  subsidiaries:  Asmara of Florida I, Inc.,  Asmara of Florida  II,
Inc.,  Asmara  of  Florida  III,  Inc.,  and  Asmara of  Florida  IV,  Inc.  All
significant intercompany accounts and transactions have been eliminated.

Cash Equivalents

The Company  considers all highly liquid  investments  with  maturities of three
months or less as cash equivalents.

Accounts Receivable

The  Company  considers  accounts  receivable  to  be  fully  collectible,   and
accordingly,  no allowance for doubtful accounts is required. If accounts become
uncollectible,  this will be charged to  operations  when the  determination  is
made.

Goodwill

Goodwill  represents  the  excess  of cost  over  fair  value of the net  assets
acquired  through  acquisitions.  In  accordance  with  Statement  of  Financial
Accounting Standards ("SFAS") No. 142 issued in June 2001, goodwill has not been
amortized  and the  Company  evaluates  the  goodwill  on an  annual  basis  for
impairment. No impairment was recorded during the year ended December 31, 2002.

Revenue and Expense Recognition

The  Company  recognizes  revenue  and  expenses  using  the  accrual  method of
accounting and, as such, reports revenue and expenses in the period in which the
revenue and expense are incurred  rather than when cash is received and expenses
paid.

                                                                             F-6




                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002

The gross billings that the Company  charges its clients under its  Professional
Services Agreement include each worksite employee's gross wages,  payroll taxes,
workers' compensation  premiums, a service fee and, to the extent elected by the
clients,  health and welfare  benefit plan costs and other  ancillary  fees. The
Company's  service  fee,  which is computed as a percentage  of gross wages,  is
intended  to yield a profit to the  Company  and to cover  the costs of  certain
employment-related employer taxes and administrative and field services provided
by the Company to the client, including payroll administration,  record keeping,
risk management,  human resources, and regulatory compliance  consultation.  The
component of the service fee related to  administration  varies according to the
size of the client,  the amount and frequency of payroll payments and the method
of  delivery  of such  payments.  The  component  of the  service fee related to
unemployment  insurance is based,  in part,  on the client's  historical  claims
experience.  All charges by the Company are  invoiced  along with each  periodic
payroll delivered to the client.

The Company reports revenue from service fees in accordance with Emerging Issues
Task Force ("EITF") No. 99-19, Reporting Revenue Gross as a Principal versus Net
as an Agent. The Company reports as revenues, on a gross basis, the total amount
billed to  clients  for  administrative  service  fees,  payroll-related  taxes,
retirement  plan fees and workers'  compensation  premium.  The Company  reports
revenue on the gross  basis for these fees  because  the  Company is the primary
obligor and deemed to be the principal in the transactions under EITF No. 99-19.
The Company  reports  revenues on a net basis for the amounts  billed to clients
for  worksite  employee  salaries  and  wages,  less  amounts  paid to  worksite
employees for these salaries and wages.

Income Taxes

Asmara,  Inc. and Able,  Inc.  have  elected to be taxed under the  provision of
Subchapter S of the Internal Revenue Code. Under these  provisions,  the Company
does not pay  corporate  income taxes on its taxable  income or is not allowed a
net  operating  loss  carryover  or  carryback  as  a  deduction.  Instead,  the
stockholders  are liabile for individual  income taxes on their respective share
of the Company's taxable income or loss on their individual tax returns.

The provision for income taxes includes the effects of transactions  reported in
the financial statements and includes taxes currently due and deferred taxes for
Woodstock Lumber Sales,  Inc.,  Asmara of Florida I, Inc., Asmara of Florida II,
Inc., Asmara of Florida III, Inc. and Asmara of Florida IV, Inc. Deferred income
taxes relate to net operating losses. A valuation  allowance has been calculated
for estimated tax benefits that may not be realized.

                                                                             F-7




                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002

Property and Equipment

Property is stated at cost less accumulated depreciation.  The cost of additions
are  capitalized  and  expenditures  for repairs and maintenance are expensed as
incurred. Depreciation is computed using accelerated and straight-line methods.

Use of Estimates

The  preparation of combined  financial  statements in conformity with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions.  These  estimates  and  assumptions  affect the reported  amount of
assets and  liabilities  and disclosure of contingent  assets and liabilities at
the date of the  combined  financial  statements  and the  reported  amounts  of
revenue and expenses  during the reporting  period.  Actual results could differ
from those estimates.

NOTE 2 - PROPERTY AND EQUIPMENT

Property and equipment are summarized as follows at December 31, 2002:

         Equipment under capital lease        $   46,031
         Office furniture and equipment           41,806
         Computer software                        25,000
                                                 112,837
         Less accumulated depreciation            62,110
                                              ----------
                                              $   50,727

Depreciation expense for the year ended December 31, 2002 was $19,800.





                                                                             F-8




                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002


NOTE 3 - STOCKHOLDER'S EQUITY

Stockholder's  equity of Asmara, Inc., Woodstock Lumber Sales, Inc., and Related
Components, Inc. is summarized as follows at December 31, 2002:

      Asmara, Inc.

         Common stock - no par value; 250,000 shares
              authrorized, 75,000 shares issued and
              outstanding                                       $         9,750
         Accumulated deficit                                         (1,218,637)
                                                                ---------------
              Total stockholder's equity (deficit)              $    (1,208,887)
                                                                ===============
      Woodstock Lumber Sales, Inc.

         Common stock - $1 par value; 100,000 shares
              authorized, 500 shares issued and outstanding     $           500
         Additional paid in capital                                      75,000
         Retained earnings                                                6,976
                                                                ---------------
              Total stockholder's equity                        $        82,476
                                                                ===============
      Related Components, Inc.

         Common stock - no par value; 1,000 shares
              authorized, 100 shares issued and outstanding     $         1,000
         Retained earnings                                                8,190
                                                                ---------------
              Total stockholder's equity                        $         9,190
                                                                ===============



                                                                             F-9






                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002


NOTE 4 - INCOME TAXES

The  provision  (benefit)  for income taxes by  components  which are subject to
income taxes for the year ended December 31, 2002 consisted of the following:



                     Woodstock             Related              Asmara of
                     Lumber Sales, Inc.    Components, Inc.     Florida I, Inc.   Total
                     -----------------     ---------------      --------------   ------------
                                                                     
 Current             $            -0-      $           -0-      $           -0-  $        -0-
 Deferred                         -0-                  -0-              (1,000)       (1,000)
 Less valuation
   adjustment                     -0-                  -0-               1,000         1,000
                     -----------------     ---------------      --------------   ------------
                     $            -0-      $           -0-      $           -0-  $        -0-


The component of the deferred tax asset at December 31, 2002 is as follows:

     Net operating loss carryforward     $        1,000
     Valuation allowance                         (1,000)
                                         ---------------
                                         $           -0-

The Company's  deferred tax asset  related to a net operating  loss. A valuation
allowance  has been  established  as the  Company  does not  have a  history  of
profitability.

At  December  31,  2002,  the  Company  has  available   unused  operating  loss
carryforwards  of  approximately  $4,000,  which may be applied  against  future
taxable income expiring through 2022.

NOTE 5 - PURCHASE OF COMPANIES

During 2002, all of the  outstanding  common stock of Asmara of Florida I, Inc.,
Asmara of Florida II, Inc.,  Asmara of Florida  III,  Inc. and Asmara of Florida
IV, Inc. was  purchased by Asmara,  Inc. for $100,000.  The purchase  method was
used to account for the purchase. The purchase price was allocated as follows:

     Cash                  $       100
     Goodwill                   99,900
                           -----------
                           $   100,000

                                                                            F-10




                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002


NOTE 6 - CONCENTRATIONS OF CREDIT RISK

Financial  instruments that potentially subject the Company to concentrations of
credit  risk  consist  principally  of cash and trade  accounts  receivable.  To
mitigate risk associated with cash balances, the Company places its cash in high
credit quality  financial  institutions.  At certain times, the Company has cash
balances in excess of federally insured limits.

NOTE 7 - RETIREMENT PLAN

The Company  maintains a  multiple-employer  401(k) Profit  Sharing Plan open to
enrollment  of  employees  based  on  client-elected  participation  and  to all
eligible  internal  employees  who have been  employed  by the Company for three
months and meet certain other  requirements.  The plan is a multi-employer  plan
that became effective on April 1, 2000. Each of the Company's  clients that have
adopted the plan have the ability to adjust the plan participation guidelines to
meet the client's specific needs as allowed by the governing plan document.

Generally,  employees can defer a portion of their salary into the Plan,  not to
exceed $11,000 for 2002. The Company may make a matching  contribution up to 50%
of the employee's  elective  deferral (up to 6%) for each plan year. The Company
made a  matching  contribution  of  approximately  $11,000  for the  year  ended
December 31, 2002.

NOTE 8 - NOTE PAYABLE

The note payable at December 31, 2002 is as follows:

     Unsecured note payable to individual due in
         monthly payments of $5,694 including
         interest at 8% through October 2003        $        52,906
     Less current portion                                   (52,906)
                                                    ---------------
                                                    $            -0-


                                                                            F-11






                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002


NOTE 9 - CAPITAL LEASE OBLIGATION

The Company leases certain equipment under a capital lease obligation. The lease
meets the criteria of capital leases and has been recorded as such.  Included in
the  property  and  equipment  account  is the cost of $46,031  and  accumulated
depreciation of $11,508.

Future minimum lease  payments  under the capital  lease,  including the present
value of minimum lease payments, subsequent to December 31, 2002 are as follows:

   2003                                                    $     29,369
   2004                                                          17,132
                                                                 46,501
   Less amount representing interest                              8,304
                                                                 38,197
   Less current installments of obligations under
        capital lease                                            22,846
                                                           ------------
        Long-term obligation under capital lease           $     15,351

NOTE 10 - FAIR VALUE OF FINANCIAL INSTRUMENTS

Statement of Financial  Accounting  Standards No. 107 requires disclosures about
the fair value for all financial  instruments,  whether or not  recognized,  for
financial  statement  purposes.   Disclosures  about  fair  value  of  financial
instruments  are based on pertinent  information  available to  management as of
December 31, 2002. Accordingly,  the estimates presented in these statements are
not necessarily  indicative of the amounts that could be realized on disposition
of financial instruments.

Management estimates the fair value of receivables, accounts payable and accrued
expenses  and notes  payable  approximate  the  carrying  value due to the short
maturity of these instruments.





                                                                            F-12





                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002

NOTE 11 - COMMITMENTS AND CONTINGENCIES

In  2002,  the  Company  rented  office  space  from a  related  party  under  a
month-to-month verbal agreement. Subsequent to the year ended December 31, 2002,
the Company entered into a two year operating lease with the related party which
expires December 2004.

The Company also leases certain office equipment under  noncancelable  operating
leases expiring through March 2007.

Rent expense for office  facilities  which was paid to the related party for the
year ended  December  31, 2002 was $48,000.  Rent  expense for office  equipment
charged to  operations  for the year ended  December 31, 2002 was  approximately
$17,000. Future minimum rentals are as follows for the years ended December 31:

                  Related
                    Party            Other            Total
                ------------      ----------       ------------
   2003         $     60,000      $   14,298       $     74,298
   2004               60,000          14,298             74,298
   2005                    -          12,859             12,859
   2006                    -           9,980              9,980
   2007                    -           2,495              2,495
                ------------      ----------       ------------
                $    120,000      $   53,930       $    173,930

The Company is,  from time to time,  involved in lawsuits  arising in the normal
course of business that, in the opinion of management,  will not have a material
effect on the Company's results of operation.

At December 31, 2002,  the Company has recorded on its balance sheet a liability
of  approximately  $830,000  for  payroll  tax  withholdings  with  various  tax
authorities  related to an  affiliated  company  that  ceased  operations  as of
December 31, 2002. The Company has obtained legal counsel and  anticipates  that
it will be able to  successfully  reach a settlement for an amount less than the
current amount recorded, although no gain contingency has been recorded.



                                                                            F-13





                           Asmara, Inc. and Affiliates
                        Notes to the Combined Statements
                                December 31, 2002

NOTE 12 - RELATED PARTY TRANSACTIONS

During  2002,  the  Company  wrote off  receivables  from  affiliated  companies
(through common ownership) totaling approximately $597,000. At the present time,
these companies are not operating  companies and they do not have the ability to
pay these receivables.

At December 31, 2002,  the Company owes a related  party  $431,531 and this same
party owes the Company  $408,455.  As described  in Note 11, the Company  leases
office space from the related party.

NOTE 13 - SUBSEQUENT EVENTS

On April 25, 2003,  the  stockholder of Asmara,  Inc. (the  "Seller")  signed an
agreement to sell: all intangible  personal property,  all cash on deposit,  all
accounts   receivable,   all  contracts  with   customers  and  suppliers,   all
governmental authorizations, all insurance programs offered by the Seller to its
customers,  all  interest in  securities  named of all  subsidiaries  (including
Asmara of Florida I, Inc.,  Asmara of Florida II,  Inc.,  Asmara of Florida III,
Inc.  and Asmara of Florida  IV,  Inc.) as well as certain  other  assets to The
Resourcing Solutions Group, Inc. (the "Buyer").  In consideration for the assets
purchased,  the Buyer will assume  approximately  $1,955,000  of debt of Asmara,
Inc. (and its subsidiaries) including $430,000 due to the shareholder of Asmara,
Inc. and the Seller will receive approximately $5,000 in cash. Thereafter, on an
annual basis, the Buyer shall deliver options to the Seller as follows:

a.   500,000 shares of the common stock of the Buyer, at a strike price of $0.03
     per share should Asmara,  Inc.  achieve an average EBITDA  (Earnings Before
     Interest, Taxes, Depreciation and Amortization) of greater than 1% and less
     than 2% of sales during the 24 months following the closing, or
b.   1,000,000  shares of the common  stock of the Buyer,  at a strike  price of
     $0.03 per share should  Asmara,  Inc.  achieve an average EBITDA of greater
     than 2% of sales over the 24 months following the closing.

Also, on April 25, 2003, the  stockholder of Woodstock  Lumber Sales,  Inc. (the
"Seller")  signed an agreement to sell 100% of the outstanding  capital stock of
the Seller to The Resourcing Solutions Group, Inc. (the "Buyer"). The Buyer will
assume approximately $35,000 in debt in connection with the purchase. The Seller
will receive $1,000 in cash.


                                                                            F-14






                           Asmara, Inc. and Affiliates
                             Combined Balance Sheet
                               September 30, 2003
                                   (Unaudited)

                                                                
         ASSETS

Current Assets:
       Cash                                                        $      1,115
       Other receivables                                                  2,150
       Prepaid expenses                                                  29,617
       Workers compensation insurance deposit                            96,342
                                                                  -------------
                Total current assets                                    129,224

Property and equipment, net of accumulated depreciation                  70,888

Other Assets:
       Goodwill                                                       2,279,376
       Deposits                                                           5,250
                                                                  -------------
                Total other assets                                    2,284,626
                                                                  -------------
                Total assets                                       $  2,484,738
                                                                  =============
        LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIT

Current Liabilities:
       Accounts payable and accrued expenses                       $     119,220
       Payroll tax and payroll related liabilities                     1,985,750
       Current portion of leases payable                                  21,850
       Current portion of long term debt                                 135,848
       Income taxes payable                                                3,500
       Loans payable to officers/stockholders                            378,780
                                                                  -------------
                Total current liabilities                              2,644,948
                                                                  -------------
Long-term debt  22,000
Commitments and contingencies                                                  -

Common stock    9,750
Retained deficit                                                       (191,960)
                                                                  -------------
                Total stockholders' equity (deficit)                   (182,210)
                                                                  -------------
                Total liabilities and stockholders' equity         $  2,484,738
                                                                  =============


                                                                            F-15






                           Asmara, Inc. and Affiliates
                        Combined Statement of Operations
                  For the Nine Months ended September 30, 2003
                                   (Unaudited)

                                                                
Revenue                                                            $  2,130,564
Cost of sales                                                         1,608,807
                                                                  -------------
       Gross profit                                                     521,756
                                                                  -------------
Operating costs and expenses:
       Depreciation and amortization                                      5,000
       Interest expense                                                   5,713
       General and administrative expenses                            1,097,403
                                                                  -------------
                Total operating costs and expenses                    1,108,116
                                                                  -------------
                Net loss from operations                          $    (586,359)
                                                                  =============


                                                                            F-16




           INTRODUCTION TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
                              FINANCIAL INFORMATION

On April 30, 2003, The  Resourcing  Solutions  Group,  Inc. (the  "Company"),  a
majority-owned  subsidiary  of Pacel Corp.,  acquired  substantially  all of the
assets of Asmara, Inc. ("Asmara"), pursuant to an Asset Purchase Agreement dated
April 25, 2003 and 100% of the  outstanding  common  stock of  Woodstock  Lumber
Sales, Inc.  ("Woodstock"),  pursuant to a Stock Purchase  Agreement dated as of
April 25, 2003  (collectively  the  "Agreements"),  by and between the  Company,
Asmara,  Woodstock and W. Revel Bellamy,  as the sole  shareholder of Asmara and
Woodstock.

Pursuant to the  Agreements,  the selected  assets of Asmara sold  include:  all
intangible  personal  property,  all  cash on  deposit,  all  non-related  party
accounts   receivable,   all  contracts  with   customers  and  suppliers,   all
governmental authorizations, all insurance programs offered by the Seller to its
customers,  all  interest in  securities  named of all  subsidiaries  (including
Asmara of Florida I, Inc.,  Asmara of Florida II,  Inc.,  Asmara of Florida III,
Inc.  and  Asmara of  Florida  IV,  Inc.) as well as certain  other  assets.  In
consideration  for the assets purchased,  the Company will assume  approximately
$1,955,000 of debt of Asmara  including  $430,000 due to the sole shareholder of
Asmara, Inc. and Asmara received approximately $5,000 in cash. Thereafter, on an
annual  basis,  the Buyer shall  deliver  options to W. Revel  Bellamy,  as sole
shareholder of Asmara, the following:

c.   500,000 shares of the common stock of the Buyer, at a strike price of $0.03
     per  share  should  Asmara  achieve  an  average  EBITDA  (Earnings  Before
     Interest, Taxes, Depreciation and Amortization) of greater than 1% and less
     than 2% of sales during the 24 months following the closing, or
d.   1,000,000  shares of the common  stock of the Buyer,  at a strike  price of
     $0.03 per share should Asmara  achieve an average EBITDA of greater than 2%
     of sales over the 24 months following the closing.

Pursuant  to the  Agreements,  the  stockholder  of  Woodstock  sold 100% of the
outstanding  capital  stock of  Woodstock to the  Company.  The Company  assumed
approximately  $35,000 in debt in  connection  with the  purchase and the Seller
received $1,000 in cash.

The acquisition  was accounted for using the purchase method of accounting.  The
purchase price was allocated to the estimated fair value of the assets  acquired
and liabilities  assumed. The estimated fair value of the assets and liabilities
assumed approximated the historical cost basis, and the Company recorded $70,000
of fees and $1,859,858 of goodwill in  conjunction  with this  acquisition.  The
consideration  paid by the  Company was funded by the  Company  existing  equity
lines of credit obtained through the issuance of common stock.


                                                                            F-17





           INTRODUCTION TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
                              FINANCIAL INFORMATION
                                   (continued)

The following unaudited pro forma condensed consolidated statement of operations
for the year ended  December 31, 2002 gives effect to the  acquisition  as if it
had occurred on January 1, 2002.  The following  unaudited  pro forma  condensed
consolidated  statement of  operations  for the nine months ended  September 31,
2003 gives  effect to the  acquisition  as if it had occurred on January 1, 2003
and presents the allocation of the purchase price over historical net book value
and is for illustrative  purposes only and is not necessarily  indicative of the
operating results or financial position that would have occurred if the purchase
has been consummated on such dates,  nor is it necessarily  indicative of future
operating  results or  financial  position.  Actual  fair  values  were based on
financial information as of the acquisition date.

The  pro  forma  adjustments  represent,  in  the  opinion  of  management,  all
adjustments  necessary to present the  Company's  pro forma  combined  financial
position and results of its combined operations in accordance with Article 11 of
Regulation  S-X of the  Securities  Exchange  Act of 1934 based  upon  available
information   and   certain   assumptions   considered   reasonable   under  the
circumstances.

The  unaudited  pro  forma  combined  financial  information  should  be read in
conjunction with the audited  financial  statements of the Company and the notes
thereto.


                                                                            F-18







                                   Pacel Corp.
       Unaudited Pro Forma Consolidated Condensed Statement of Operations
                  For the Nine Months ended September 30, 2003

                                 Pacel                               Pro Forma    Pro Forma
                                 Corp.            Asmara           Adjustments   Consolidated
                                -----------     ------------    --------------  -------------

                                                                    
Revenue                         $ 2,507,291     $    877,200    $          -    $   3,384,491
Cost of sales                     1,898,953          748,334               -        2,647,287
                                -----------     ------------    --------------  -------------
    Gross profit                    608,338          128,866               -          737,204

Depreciation and
    amortization                     15,722           10,436          (2,262)(1)       23,896
Interest expense                    125,015            4,572               -          129,587
Financing expense                   393,818                -               -          393,818
Sales, general and
    administrative                2,163,543          345,572               -        2,509,115
                                -----------     ------------    --------------  -------------
    Total operating costs         2,698,098          360,580          (2,262)       3,056,416

Other income (expenses)                   -                -               -                -
                                -----------     ------------    --------------  -------------
Net loss                        $(2,089,760)      $ (231,714)   $      2,262    $  (2,319,212)
                                ===========     ============    ==============  =============

Net loss per share:
    Basic                       $     (0.01)                                    $       (0.01)
    Diluted                     $     (0.01)                                    $       (0.01)

Weighted average shares
    outstanding:
    Basic                       193,620,431                                       193,620,431
    Diluted                     193,620,431                                       193,620,431



   The accompanying notes are an integral part to these financial statements.

                                                                            F-19






                                   Pacel Corp.
       Unaudited Pro Forma Consolidated Condensed Statement of Operations
                      For the year ended December 31, 2002


                                 Pacel                               Pro Forma    Pro Forma
                                 Corp.            Asmara           Adjustments   Consolidated
                                -----------     ------------    --------------  -------------

                                                                    
Revenue                         $   298,419     $  4,057,317                -   $   4,355,736
Cost of sales                       281,339        2,870,845                -       3,152,184
                                -----------     ------------    --------------  -------------
    Gross profit                     17,080        1,186,472                -       1,203,552

Research and development              9,121                -                -           9,121
Depreciation and
    amortization                     55,618           19,800            4,728 (1)      80,146
Interest expense                    141,450           17,486                -         158,936
Financing expenses                  235,509                -                -         235,509
Sales, general and
    administrative                4,367,365        1,377,006                -       5,526,058
                                -----------     ------------    --------------  -------------
    Total operating costs         4,809,063        1,414,292            4,728       6,228,083

Other income (expenses):
    Write-off of related
      party receivable                    -         (597,060)                -       (597,060)
                                -----------     ------------    --------------  -------------
Loss before extraordinary
    Items                        (4,791,183)        (824,880)          (4,728)     (5,621,591)
                                -----------     ------------    --------------  -------------
Gain on extinguishment
    of debt                         426,150                -                -          426,150
Discontinued operations:
    Loss from operations           (220,268)               -                -         (220,268)
    Gain on disposal                177,817                -                -          177,817
Cumulative effect of
    accounting change              (407,049)               -                -         (407,049)
                                -----------     ------------    --------------  -------------
Net loss                        $(4,815,333)    $   (824,880)   $      (4,728)  $   (5,644,941)
                                ===========     ============    ==============  =============


                                                                            F-20






                                   Pacel Corp.
       Unaudited Pro Forma Consolidated Condensed Statement of Operations
                      For the year ended December 31, 2002

                                 Pacel                               Pro Forma    Pro Forma
                                 Corp.            Asmara           Adjustments   Consolidated
                                -----------     ------------    --------------  -------------

                                                                    
Net loss per share:
    Basic                       $     (0.33)                                    $       (0.38)
    Diluted                     $     (0.33)                                    $       (0.38)

Weighted average shares
    outstanding:
    Basic                         14,714,561                                       14,914,561
    Diluted                       14,714,561                                       14,914,561







   The accompanying notes are an integral part to these financial statements.

                                                                            F-21





                                   Pacel Corp.
  Notes to the Unaudited Pro Forma Condensed Consolidated Financial Information

The pro forma adjustments give effect to the acquisition of Asmara and Woodstock
as if the  transaction  was  consummated  on  January  1,  2003.  The pro  forma
adjustments are as follows:

(1)  To reflect adjustment of depreciation of fixed assets.






                                                                            F-22