Edgar Filing: STONEPATH GROUP INC

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

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/ / Preliminary Proxy Statement
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(as permitted by Rule 14a-6(e)(2))
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/ / Soliciting Material Under Rule 14a-12

Stonepath Group, Inc.
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(Name of Registrant as Specified in Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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STONEPATH GROUP, INC.
1600 Market Street, Suite 1515
Philadelphia, PA 19103

April 8, 2004
Dear Fellow Stockholder:

You are cordially invited to attend the Annual Meeting of Stockholders
(the "Meeting") of Stonepath Group, Inc. (the "Company") which will be held at
the offices of Buchanan Ingersoll PC, 1835 Market Street, 15th Floor,
Philadelphia, Pennsylvania 19103, on Wednesday, May 26, 2004 at 10:00 a.m. local
time. Your Board of Directors and management look forward to personally greeting
those stockholders able to attend.

At the Meeting, stockholders will be asked to:

(1) elect the Company's directors;

(2) approve an amendment to the Stonepath Group, Inc. Amended and
Restated 2000 Stock Incentive Plan to increase the number of
shares of the Company's Common Stock which may be issued
thereunder;

(3) ratify the appointment of KPMG LLP as the Company's independent
auditors for the year ending December 31, 2004; and

(4) consider such other matters as may be properly brought before the
Meeting and at any adjournment(s) or postponement(s) thereof.

These matters are discussed in greater detail in the accompanying Proxy
Statement.

Your Board of Directors recommends a vote FOR the election of the
Company's directors nominated, FOR the amendment to the Stonepath Group, Inc.
Amended and Restated 2000 Stock Incentive Plan and FOR the ratification of KPMG
LLP as the Company's independent auditors.

Regardless of the number of shares you own or whether you plan to
attend, it is important that your shares be represented and voted at the
Meeting. Please sign, date and mail the enclosed proxy promptly.

A copy of the Company's Annual Report for the year ended December 31,
2003 is enclosed for your information. No material contained in the Annual
Report is to be considered a part of the proxy solicitation material.

We wish to thank you for your loyal support of the Company and your
participation in this process.

Sincerely,

Dennis L. Pelino
Chairman of the Board

STONEPATH GROUP, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 26, 2004

April 8, 2004

To the Stockholders of Stonepath Group, Inc.:

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of Stonepath Group, Inc. (the "Company") will be held at the offices
of Buchanan Ingersoll PC, 1835 Market Street, 15th Floor, Philadelphia,
Pennsylvania 19103, on Wednesday, May 26, 2004 at 10:00 a.m. local time, for the
following purposes:

(1) to elect the Company's directors;

(2) to approve an amendment to the Stonepath Group, Inc. Amended and
Restated 2000 Stock Incentive Plan to increase the number of
shares of the Company's Common Stock which may be issued
thereunder;

(3) to ratify the appointment of KPMG LLP as the Company's independent
auditors for the year ending December 31, 2004; and

(4) to consider such other matters as may be properly brought before
the Meeting and at any adjournment(s) or postponement(s) thereof.

A copy of the Company's Annual Report for the year ended December 31,
2003 is enclosed for your information. No material contained in the Annual
Report is to be considered a part of our proxy solicitation material.

Only stockholders of record as of the close of business on April 1,
2004 will be entitled to vote at the Meeting and any adjournment(s) or
postponement(s) thereof.

All stockholders are cordially invited to attend the Meeting. However,
to assure your representation at the Meeting, you are urged to complete, sign,
date and return the enclosed proxy card as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. Any stockholder attending
the Meeting may vote in person even if he or she has returned a proxy.

By Order of the Board of Directors,

Stephen M. Cohen
Senior Vice President, General Counsel
and Secretary

STONEPATH GROUP, INC.
1600 Market Street, Suite 1515
Philadelphia, PA 19103

PROXY STATEMENT

The enclosed proxy is solicited on behalf of the Board of Directors of
Stonepath Group, Inc. (the "Company") to be voted at the Annual Meeting of
Stockholders (the "Meeting") of the Company to be held at the offices of
Buchanan Ingersoll PC, 1835 Market Street, 15th Floor, Philadelphia,
Pennsylvania 19103, on Wednesday, May 26, 2004 at 10:00 a.m. local time, and at
any adjournment(s) or postponement(s) thereof for the purposes set forth in the
accompanying Notice of Annual Meeting of Stockholders. The proxy solicitation
materials were mailed on or about April 8, 2004 to all stockholders entitled to
vote at the Meeting.

Record Date and Stock Ownership

Stockholders of record at the close of business on April 1, 2004 (the
"Record Date") are entitled to notice of and to vote at the Meeting, and at any
adjournment(s) or postponement(s) thereof. At the Record Date, 40,519,392 shares
of the Company's Common Stock, $.001 par value per share (the "Common Stock")
were issued, outstanding and entitled to notice of and to vote on all matters at
the Meeting and at any adjournment(s) or postponement(s) thereof.

Quorum and Voting Requirements

The Company's Bylaws provide that the stockholders holding a majority
of the shares issued, outstanding and entitled to vote on the Record Date must
be present in person or by proxy at the Meeting to constitute a quorum for the
transaction of business at the Meeting.

All shares of Common Stock represented by valid proxies received by the
Secretary of the Company prior to the Meeting will be voted as specified in the
proxy. If no specification is made, the shares will be voted FOR the election of
each of the Board's nominees to the Board of Directors and FOR each of the other
matters submitted by the Board of Directors for vote by the stockholders. Unless
otherwise indicated by the stockholder, the proxy card also confers
discretionary authority on the Board-appointed proxies to vote the shares
represented by the proxy on any matter that is properly presented for action at
the Meeting. Abstentions and broker non-votes (which arise from proxies
delivered by brokers and others, where the record holder has not received
direction on voting and does not have discretionary authority to vote on one or
more matters) are each included in the determination of the number of shares
present for purposes of determining a quorum. At the Meeting, directors will be
elected by a plurality vote and all other matters will be decided by the
affirmative vote of a majority of the shares of Common Stock present at the
meeting, in person or by proxy, and entitled to vote. Abstentions are counted as
shares present at the meeting for purposes of determining the votes cast on any
matter and have the effect of a vote against any matter as to which abstention
is specified. Broker non-votes are not considered shares present for purposes of
the vote on any matter as to which the broker non-vote is specified and will not
affect the outcome of the vote.

The execution of a proxy will not affect a stockholder's right to
attend the Meeting and vote in person. Any proxy given pursuant to this
solicitation may be revoked by the person giving it at any time before it is
used at the Meeting by filing with the Secretary of the Company either: (i) a
written notice of revocation; (ii) a proxy bearing a later date than the most
recently submitted proxy; or (iii) by attendance at the Meeting and voting in
person. Attendance at the Meeting will not, by itself, revoke a proxy.

Registered stockholders (those who hold shares directly rather than
through a bank or broker) can simplify their voting by voting via the internet
at www.votestock.com. Internet voting information is provided on the Proxy Card.
Use of a Control Number is designed to verify stockholders' identities and allow
stockholders to vote their shares and confirm that their voting instructions
have been properly recorded. The Control Number is identified and located on the
Proxy Card. If a stockholder holds shares through a bank or broker, the
stockholder will receive separate instructions on the form received from the
bank or broker. Although most banks and brokers now offer Internet voting,
availability and specific processes will depend on their voting arrangements.

Annual Report

A copy of the Company's Annual Report for the year ended December 31,
2003 accompanies this Proxy Statement. No material contained in the Annual
Report is to be considered a part of our proxy solicitation material.

The mailing address of the Company's executive office is 1600 Market
Street, Suite 1515, Philadelphia, PA 19103.

Solicitation

The cost of this proxy solicitation will be borne by the Company. The
Company will reimburse brokers and other persons holding stock in their names or
in the names of nominees for their expenses incurred in sending proxy materials
to principals and obtaining their proxies.

Shareholder Proposals

Proposals of stockholders that are intended to be included within the
proxy material for our 2005 Annual Meeting of Stockholders must comply with the
requirements of SEC Rule 14a-8 and must be received no later than December 10,
2004 in order to be included in the Proxy Statement and proxy relating to that
Annual Meeting.

PROPOSAL 1

ELECTION OF DIRECTORS

Nominees for Consideration at the Meeting

The Bylaws provide that the Board of Directors shall consist of such
number of directors as is established from time to time by the affirmative vote
of a majority of the Board of Directors. The Board has resolved to have six (6)
directors. Each person who is appointed or elected to the Board of Directors
will hold that position until the close of the next annual meeting of
stockholders, until he or she ceases to be a director by operation of law or
until he or she resigns.

The six (6) persons listed below have been nominated by the Board of
Directors to serve as directors of the Company.

Unless otherwise specified, each properly executed proxy received will
be voted for the election of the nominees named below to serve as directors
until the end of their respective terms or until his/her successor is elected
and qualified. The Company is not aware of any reason that any nominee will be
unable to serve or will decline to serve as a director. In the event that any
nominee is unable to serve or will not serve as a director, it is intended that
the proxies solicited hereby will be voted for such other person or persons as
shall be nominated by management.

INFORMATION ABOUT NOMINEES FOR DIRECTOR

The following table sets forth certain information with respect to each
of the nominees for director and their current positions with the Company.

Year in Which
Service as a
Director's Name and Age Principal Occupation Director Began
----------------------- -------------------- --------------

Dennis L. Pelino, 56 Chairman of the Board of 2001
Directors and Chief Executive
Officer

J. Douglass Coates, 61 Principal-Manalytics 2001
International, Inc.

Robert McCord, 45 Managing Director-PA Early Stage 2001

David R. Jones, 55 Private Consultant 2000

Aloysius T. Lawn, IV, 45 Executive Vice President and 2001
General Counsel-Talk America
Holdings, Inc.

John H. Springer, 47 Director of Global Operations - 2003
Golf Division, Nike, Inc.

Dennis L. Pelino

Dennis L. Pelino has served as our Chairman of the Board of Directors
and Chief Executive Officer since June 21, 2001. Mr. Pelino has over two decades
of executive experience in the logistics industry. From 1986 to 1999, he was
employed by Fritz Companies, Inc., initially as director of International
Operations and Sales and Marketing, in 1993 as its Chief Operating Officer and
commencing in 1996, also as its President. Mr. Pelino was also a member of the
Board of Directors of Fritz Companies from 1991 to 1999. During Mr. Pelino's
tenure, he acquired or started over 50 companies for Fritz as it became one of
the leading global logistics companies. Prior to Fritz, Mr. Pelino held senior
executive positions in the container shipping industry and in the domestic
full-service truck leasing industry. Most recently, from 1999 through 2001, Mr.
Pelino has been involved as a director and principal of a number of private
ventures which explored opportunities in the logistics industry and which
provided consulting services relative to business opportunities in Latin
America, China and other Far Eastern regions.

J. Douglass Coates

J. Douglass Coates has served as a member of our Board of Directors
since August 2001. He has been principal of Manalytics International, Inc., a
transportation, logistics and supply chain consulting firm based in San
Francisco, California, since 1992. He was previously President of ACS Logistics,
a division of American President Lines, and President of Milne Truck Lines, then
a subsidiary of the Sun Company. Mr. Coates holds a B.S. in Engineering from
Pennsylvania State University and an MBA from the Wharton School of the
University of Pennsylvania.

David R. Jones

David Jones has served as a member of our Board of Directors since
September 2000. Mr. Jones has since 1995 been President of DR Jones Financial,
Inc., a privately-held consulting firm specializing in early stage ventures. He
is presently a director of Financial Asset Securities Corporation, an affiliate
of Greenwich Capital Markets, Inc., and WorldSync Plus, an early stage
technology company. Mr. Jones was Senior Vice President-Asset Backed Finance of
Greenwich Capital Markets, Inc. from 1989 to 1995. Mr. Jones served as a Vice
President, and subsequently as a Managing Director of The First Boston
Corporation, an investment banking firm, from 1982 to 1989 and as
Manager-Product Development of General Electric Credit Corp., an asset-based
lender and financial services company, from 1981 to 1982. Mr. Jones is a
graduate of Harvard College and has an MBA from the Amos Tuck School of Business
Administration.

Aloysius T. Lawn, IV

Aloysius T. Lawn has served as a member of our Board of Directors since
February 2001. Mr. Lawn is the Executive Vice President - General Counsel and
Secretary of Talk America Holdings, Inc., an integrated communications service
provider with programs designed to benefit the residential and small business
markets. Prior to joining Talk America Holdings, Inc. in 1996, Mr. Lawn was an
attorney in private practice with extensive experience in private and public
financings, mergers and acquisitions, securities regulation and corporate
governance from 1985 through 1995. Mr. Lawn graduated from Yale University and
Temple University School of Law.

Robert McCord

Robert McCord has served as a member of our Board of Directors since
March 2001. He is also a Managing Director of PA Early Stage, a family of seed
and early stage venture funds, which he co-founded in 1997. He also serves as
Chairman of the Eastern Technology Council, a consortium of more than 800
technology-oriented companies. At the Technology Council he provides contacts,
capital and information for senior executives. Mr. McCord previously served as
Vice President of Safeguard Scientifics, Inc., a leader in identifying,
developing and operating premier technology companies. Before joining Safeguard,
Mr. McCord spent a decade on Capitol Hill where he served as Chief of Staff,
Speechwriter and Budget Analyst in a variety of congressional offices. He
specialized in budget and deregulatory issues and, as Chief Executive Officer of
the bipartisan Congressional Institute for the Future, he ran a staff which
tracked legislation and provided policy analyses and briefings. Mr. McCord
earned his A.B., with high honors, from Harvard University and his MBA from the
Wharton School.

John H. Springer

John H. Springer has served as a member of our Board of Directors since
May 2003. Mr. Springer has extensive global supply chain management and
logistics experience, having held both domestic U.S. and international logistics
positions at IBM Corporation, Union Pacific Corporation's third party logistics
unit, and at Dell Computer from 1995 to 2002. Mr. Springer joined Nike Inc. in
2002 and is its Director of Global Operations - Nike Golf. Mr. Springer has been
active in the Council of Logistics Management throughout his career, including
holding the position of President for the Central Texas region. He earned his
B.S. at Syracuse University in Transportation & Distribution Management, and his
MBA from St. Edwards University in Austin, Texas.

INFORMATION ABOUT EXECUTIVE OFFICERS
Our executive officers as of March 1, 2004 are as follows:

Year in Which
Officer's Name and Age Office Service Began
---------------------- ------ -------------

Dennis L. Pelino, 56 Chairman of the Board of Directors 2001
and Chief Executive Officer

Gary A. Koch, 45 Chief Executive Officer of Stonepath 2001
Logistics Domestic Services, Inc.

Jason Totah, 44 Chief Executive Officer of Stonepath 2002
Logistics International Services,
Inc.

Stephen M. Cohen, 47 Senior Vice President, General 2000
Counsel and Secretary

Bohn H. Crain, 40 Chief Financial Officer and Treasurer 2002

Thomas L. Scully, 54 Vice President - Controller and 2001
Principal Accounting Officer

For biographical information regarding Mr. Pelino, please see his
biography under "Information about Nominees for Director" set forth above.

Gary A. Koch

Gary A. Koch serves as the Chief Executive Officer of Air Plus and
Stonepath Logistics Domestic Services, Inc. Mr. Koch co-founded Air Plus in May
1990. In ten years, he built Air Plus into a transportation logistics company
serving a customer base of manufacturing distributors and national retail chains
with close to $60.0 million in annual revenues, over 200 employees and 16
offices in North American cities. Mr. Koch has over twenty years of logistics
experience in the U.S. and Canadian markets with expertise in traditional air
freight and distribution logistics. Mr. Koch received a B.S. in Marketing from
Purdue University.

Jason Totah

Jason F. Totah serves as the Chief Executive Officer of Stonepath
Logistics International Services, Inc. ("SLIS", f/k/a Global Transportation
Services, Inc."). Mr. Totah joined SLIS in 1990 and has held several positions
including Seattle Branch manager and Senior Vice President, Sales and Marketing,
and Senior Vice President of Sales and Operations. Prior to joining SLIS, he
worked in international logistics for Amoco Petroleum, stationed in various
locations around the world. He graduated from Oregon State in 1983 with a degree
in Agriculture Engineering.

Stephen M. Cohen

Stephen M. Cohen has served as our Senior Vice President, General
Counsel and Secretary since April 2000. Since 1980, Mr. Cohen has been engaged
in the practice of law, having most recently been a shareholder of Buchanan
Ingersoll PC from March 1996 to April 2000 and a partner at Clark, Ladner,
Fortenbaugh & Young from March 1990 to March 1996. Mr. Cohen's practice focused
on corporate finance and federal securities matters. Mr. Cohen received a B.S.
in Accounting from the School of Commerce and Finance of Villanova University, a
J.D. from Temple University and a L.L.M. in Taxation from Villanova University
School of Law.

Bohn H. Crain

Bohn H. Crain has served as our Chief Financial Officer since January
10, 2002 and our Treasurer since May 30, 2002. Mr. Crain has over 15 years of
experience in finance and accounting as well as extensive knowledge of
transportation and logistics. Prior to joining Stonepath's executive team, he
served from January 2001 to September 2001 as Executive Vice President and Chief
Financial Officer for Schneider Logistics, Inc., a third-party logistics
company. Before Schneider, Mr. Crain served from May 2000 to January 2001 as
Vice President and Treasurer for Florida East Coast Industries, Inc., and from
June 1989 to May 2000, he held various Vice President and treasury positions
with CSX and various of its subsidiaries. Mr. Crain holds a B.S. in Business
Administration - Accounting from the University of Texas.

Thomas L. Scully

Thomas L. Scully has served as our Vice President - Controller since
November 19, 2001. Before joining Stonepath, Mr. Scully was a senior manager
within the assurance and advisory services of Deloitte & Touche, LLP from
December 1996 to November 2001. Prior to Deloitte & Touche, from October 1980 to
June 1996, Mr. Scully was an audit partner at BDO Seidman, LLP where he led
numerous accounting, auditing and tax engagements for publicly traded and
privately-held local, national, and international clients. Prior to BDO, he held
the position of audit supervisor at Coopers & Lybrand, LLP. Mr. Scully is a
certified public accountant and earned a B.S. in Accounting from St. Joseph's
University, Philadelphia.

Board Meetings

During the year ended December 31, 2003, the Board of Directors held
nine (9) meetings and acted by unanimous consent on five (5) occasions.
Additionally, there were eight (8) Audit Committee meetings and six (6)
Compensation Committee meetings held during 2003. During 2003, each Board member
attended 75% or more of the meetings held by the Board and any committee upon
which such director served.

It is the Company's policy that the directors who are up for election
at an annual meeting of stockholders attend that meeting. All of the Company's
directors attended last year's annual meeting of stockholders.

Board Committees

Audit Committee

The Audit Committee is responsible for monitoring the integrity of the
Company's financial statements and reporting processes and systems of internal
control regarding finance, accounting, and legal compliance and approving the
engagement of its independent auditors. The Audit Committee held eight (8)
meetings in 2003. The members of the Audit Committee are David R. Jones,
Chairman, as well as Aloysius T. Lawn, IV, and Robert McCord. Each of these
Audit Committee members is independent as defined in the listing standards of
the American Stock Exchange and the rules of the Securities and Exchange
Commission. The Board has determined that Mr. Jones qualifies as an "audit
committee financial expert" as defined in the rules of the Securities and
Exchange Commission by virtue of his education and experience in complex
financial matters and the analysis and review of financial statements and has
designated Mr. Jones as the "audit committee financial expert." For a
description of Mr. Jones' relevant experience, see "Information About Nominees
for Director - David R. Jones."

Compensation Committee

The Compensation Committee is responsible for determining the
compensation of the officers and employees of the Company and administering the
Company's compensation plans. The Compensation Committee held six (6) meetings
in 2003. The members of the Compensation Committee are Aloysius T. Lawn, IV,
Chairman, as well as David R. Jones and John H. Springer. Each of these
Compensation Committee members is independent as defined in the listing
standards of the American Stock Exchange and the rules of the Securities and
Exchange Commission.

Board Nominating Procedures

Given the relatively small size of the Board of Directors and the
existence of other committees of the Board requiring substantial attention and
effort, the Board has determined that it is appropriate not to establish a
separate nominating committee. The Board has also determined that a nominating
committee is not necessary in light of the written nominating procedures it has
adopted and the fact that nominations are determined by the vote of a majority
of the directors who are independent.

The Board will consider candidates for membership suggested by its
members, as well as by the Company's management and stockholders. The Board may
also from time to time retain a third-party executive search firm to identify
candidates.

A stockholder who wishes to recommend a prospective nominee for the
Board of Directors should notify the Company's Corporate Secretary in writing
with whatever supporting material the stockholder considers appropriate.

Once the Board has identified a prospective nominee, it will make an
initial determination as to whether to conduct a full evaluation of the
candidate. This initial determination will be based on the need for additional
Board members to fill vacancies or to expand the size of the Board. If it is

determined that there is a need for additional Board members, the Board will
then evaluate the prospective nominee considering the following factors:

o the candidate's ability to represent the interests of the
Company's stockholders;

o the candidate's skill, integrity, and independence of thought and
judgment;

o the candidate's experience with businesses and other organizations
of comparable size and stage of development;

o the relationship of the candidate's experience to the experience
of other members of the Board and whether the candidate adds to
the range of talent, skill and expertise possessed by the existing
members of the Board; and

o the candidate's ability to dedicate sufficient time, energy and
attention to the diligent performance of a director's duties,
including the candidate's service on other boards of directors.

The Board will also consider such other relevant factors as it deems
appropriate, including the current composition of the Board, the balance of
management and independent directors, the need for audit committee expertise and
the evaluations of other prospective nominees.

As part of the evaluation, the Board will have the prospective nominee
interviewed by one or more of its members, and others as appropriate, either in
person or by telephone. After completing this evaluation and interview, the
Board will then determine, by a vote of a majority of directors who are
independent, whether to elect the prospective nominee to the Board in the case
where stockholder approval is not required, or to nominate the candidate for
election by the Company's stockholders.

Stockholder Communications to Directors

The Board of Directors has adopted a written process for stockholders
to send communications to the Board of Directors. All correspondence which a
stockholder desires to send to the members of the Board of Directors should be
forwarded to the Corporate Secretary of the Company. The Corporate Secretary
will review all correspondence to determine whether it deals with the functions
of the Board of Directors or its committees and, if so, shall forward the
correspondence to all directors. Concerns relating to accounting, internal
controls or auditing matters shall be immediately brought to the attention of
the Audit Committee.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE
FOR THE COMPANY'S DIRECTORS

PROPOSAL 2

APPROVAL OF AMENDMENT TO THE STONEPATH GROUP, INC. AMENDED AND
RESTATED 2000 STOCK INCENTIVE PLAN

The Company's stockholders are being asked to approve an amendment to
the Stonepath Group, Inc. Amended and Restated 2000 Stock Incentive Plan (the
"Stock Incentive Plan") to increase the number of shares of the Company's Common
Stock reserved for issuance under the Stock Incentive Plan by 2,000,000 shares.
The Board of Directors unanimously adopted this amendment on March 11, 2004,
subject to stockholder approval at the Meeting.

The proposed amendments will assure that a sufficient reserve of Common
Stock remains available for issuance under the Stock Incentive Plan to allow the
Company to continue to utilize equity incentives to attract and retain the
services of officers, employees, directors and consultants (collectively,
"covered persons") to the Company which the Company views as essential to its
long-term growth and financial success. The Company relies significantly on
equity incentives in the form of stock awards and stock option grants to attract
and retain covered persons and believes such equity incentives are necessary for
the Company to remain competitive in the marketplace for such talent. Stock and
option grants made to newly-hired or continuing covered persons will be based on
both competitive market conditions and individual performance. In addition, the
Company has acquired other companies in the past, and anticipates future
acquisitions. It is important that the Company be able to offer equity
incentives to employees of the companies acquired so that they remain
incentivized after the acquisition has been completed.

The Stock Incentive Plan was approved in September 2000 by the
stockholders of the Company at that time, and subsequent amendments to the Stock
Incentive Plan were approved by the stockholders of the Company on May 31, 2002
and May 30, 2003. A total of 13,000,000 shares of Common Stock of the Company
currently are reserved for issuance under the Stock Incentive Plan. As of March
5, 2004, 10,313,634 shares were subject to awards currently outstanding under
the Stock Incentive Plan (the "Plan Options") and 1,326,700 shares were subject
to awards granted outside the Stock Incentive Plan (the "Non-Plan Options").

The following is a summary of the principal features of the Stock
Incentive Plan. The summary, however, does not purport to be a complete
description of all of the provisions of the Stock Incentive Plan. The complete
text of the Stock Incentive Plan, as amended herein, appears as Exhibit A to
this Proxy Statement and the following description is qualified in its entirety
by reference to Exhibit A.

Purpose

The purposes of the Stock Incentive Plan are to: (i) better align the
interests of stockholders with the interest of officers, directors, employees
and consultants of the Company and its subsidiaries by creating a direct linkage
between participants' rewards and the performance of the Company and its
subsidiaries; (ii) encourage stock ownership and proprietary interests in the
Company's stock; and (iii) assist the Company and its subsidiaries in attracting
and retaining highly competent officers, directors, employees and consultants
vital to its success.

Term

The Stock Incentive Plan became effective on June 1, 2000. The Stock
Incentive Plan has no fixed expiration date.

Administration

The Stock Incentive Plan may be administered by the full Board of
Directors or by a committee of the Board comprised of two or more "Non-Employee
Directors" within the meaning of Rule 16b-3(b)(3) of the Securities Exchange Act
of 1934, as amended (the Board of Directors or the committee shall hereinafter
be referred to as the "Plan Administrator"). The Plan Administrator has, among
other matters, the exclusive authority to make awards under the Stock Incentive
Plan and to make interpretations and determinations involving the Stock
Incentive Plan.

Participation and Types of Awards

Employees, officers and directors of the Company and its subsidiaries
are currently eligible to receive non-qualified stock options, restricted stock
awards, and "incentive stock options" within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"). In addition, advisors
and consultants who perform services for the Company are eligible to receive
non-qualified stock options and stock awards under the Stock Incentive Plan.

Shares Subject to the Stock Incentive Plan

The number of shares of Common Stock which may be issued under the
Stock Incentive Plan is currently 13,000,000 and, upon approval of this Proposal
by the stockholders, will be 15,000,000. All of the shares of Common Stock may
be awarded in the form of stock options or stock awards. However, pursuant to
Section 162(m) of the Code, currently, stock options with respect to no more
than 2,500,000 shares of Common Stock may be granted to any one individual
participant during any one calendar year period. In addition, the following
shares may be added back to the Stock Incentive Plan and made available for
issuance under the Stock Incentive Plan: (i) any shares of Common Stock that are
forfeited, cancelled or re-acquired by the Company; (ii) any shares of Common
Stock tendered in satisfaction of tax withholding or other obligations relating
to proposed awards under the Stock Incentive Plan; and (iii) any shares of
Common Stock underlying an award that is terminated (other than by exercise).

Performance-Based Compensation

Section 162(m) of the Code limits to $1,000,000 annually the deduction
a public corporation may claim for compensation paid to any of its top five (5)
executive officers, except in limited circumstances. One such exception is for
"performance-based compensation," which is defined as compensation paid solely
on account of the attainment of one or more performance goals, but only (i) if
the goals are determined by a compensation committee of the board comprised of
two (2) or more outside directors, (ii) the performance goals are disclosed to
stockholders and approved by a majority vote before the remuneration is paid,
and (iii) before the remuneration is paid, the compensation committee certifies
that the performance goals and any other material terms were in fact satisfied.

Internal Revenue Service regulations provide that compensation
attributable to a stock option will be deemed to satisfy the requirement that
performance goals be pre-established if the grant of the option is made by the
compensation committee; the plan under which the option is granted states the
maximum number of shares with respect to which options or rights may be granted
during a specified period to any employee; and, under the terms of the option,
the amount of compensation the employee could receive is based solely on an
increase in the value of the stock after the date of grant.

The Stock Incentive Plan includes features intended to permit the Plan
Administrator to grant options and stock awards to employees that will qualify
as performance-based compensation.

Stock Options

Options granted under the Stock Incentive Plan may be either incentive
stock options or non-qualified stock options. The Plan Administrator will
determine whether and to what extent options will be granted under the Stock
Incentive Plan and whether such options granted will be incentive stock options
or non-qualified stock options; provided, however, that: (i) incentive stock
options may be granted only to employees of the Company or any of its
subsidiaries, (ii) no incentive stock options may be granted following the tenth
anniversary of the effective date of the Stock Incentive Plan, and (iii) the
aggregate fair market value (determined as of the date of grant of the option)
of the Common Stock with respect to which incentive stock options may become
exercisable for the first time by any individual during any calendar year may
not exceed $100,000 or, if it does, the portion of such options which exceeds
such amount will be treated as non-qualified stock options. Unless otherwise
specified in the agreement evidencing the option, options granted under the
Stock Incentive Plan may be exercised for a period of up to ten (10) years from
the date of grant.

The price at which each share covered by an option may be purchased
will be determined in each case by the Plan Administrator; provided, however,
that such price, in the case of incentive stock options, may not be less than
the fair market value of Common Stock on the date of grant.

Options will be exercisable at such time or times, or upon such event
or events, and subject to such terms, conditions, performance criteria, and
restrictions as will be determined by the Plan Administrator and as set forth in
the agreement relating thereto; provided, however, that: (i) no option will be
exercisable after the expiration of ten (10) years after the date of grant of
such option, (ii) no incentive stock option granted to a participant who owns
more than 10% of the combined voting power of all classes of stock of the
Company (or any parent or subsidiary of the Company) will be exercisable after
the expiration of five (5) years after the date of grant of such option and the
exercise price of an incentive stock option granted to such stockholder may not
be less than 110% of the fair market value of the Common Stock on the date of
grant, and (iii) no option granted to a prospective employee, prospective
consultant, or prospective director may become exercisable prior to the date on
which such person commenced service with the Company or its subsidiaries.

Stock Awards

The Plan Administrator may grant stock awards to any officer, director,
employee or consultant of the Company or any of its subsidiaries. A stock award
entitles the recipient to acquire shares of Common Stock subject to such
restrictions and conditions as the Plan Administrator may determine at the time
of grant. Conditions may be based on continuing employment (or other business
relationship) and/or achievement of pre-established performance goals and
objectives.

Upon execution of a written instrument setting forth the stock award
and paying any applicable purchase price, a participant shall have the rights of
a stockholder with respect to the Common Stock subject to the stock award,
including, but not limited to, the right to vote and receive dividends with
respect thereto; provided, however, that shares of Common Stock subject to stock
awards that have not vested shall be subject to restrictions on transferability.
Unless the Plan Administrator otherwise determines, certificates evidencing the
stock awards shall remain in the possession of the Company until such Common
Stock is vested.

The Plan Administrator at the time of grant shall specify the date or
dates and/or the attainment of pre-established performance goals, objectives and
other conditions on which Common Stock shall become vested, subject to such
further rights of the Company or its assigns as may be specified in the
instrument evidencing the stock award. If the participant or the Company, as the
case may be, fails to achieve the designated goals or the participant's
relationship with the Company is terminated prior to the expiration of the
applicable vesting period, the participant shall forfeit all shares of Common
Stock subject to the stock award which have not then vested. Unvested Common
Stock may not be sold, assigned, transferred, pledged or otherwise encumbered or
disposed of except as specifically provided in the Stock Incentive Plan or in
the written instrument evidencing the stock award.

Termination of Service

If a participant ceases to perform service for the Company, all options
which such participant is then entitled to exercise may be exercised until the
earlier to occur of the three-month anniversary after termination of service or
the expiration of the relevant option exercise period, unless otherwise provided
for in the award agreement.

However, if a participant ceases to perform service for the Company or
any of its subsidiaries due to death, disability or retirement, any options then
exercisable will be exercisable until the earlier to occur of the one-year
anniversary of termination of service or the expiration of the relevant option
exercise period, unless otherwise provided for in the award agreement.

In addition, if the Company or any of its subsidiaries terminates a
participant's service for "Cause" (as defined in the Stock Incentive Plan), then
any and all options held by such person will terminate forthwith, unless
otherwise provided for in the award agreement.

Stock Adjustments

If, as a result of any merger, consolidation, sale of all or
substantially all of the assets of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split, or other similar transaction, the outstanding shares of Common Stock are
increased or decreased or are exchanged for a new, different or additional
number or kind of shares or other securities of the Company, or other non-cash
assets of the Company are distributed with respect to such shares of Common
Stock or other securities, the Plan Administrator may make an appropriate or
proportionate adjustment in (i) the number of options that can be granted to any
one participant, (ii) the number and kind of shares or other securities subject
to any then outstanding awards under the Stock Incentive Plan, and (iii) the
price for each share subject to any then outstanding options under the Stock
Incentive Plan, without changing the aggregate exercise price (i.e., the
exercise price multiplied by the number of shares as to which such options
remain exercisable). The adjustment by the Plan Administrator will be final,
binding and conclusive.

If, as a result of a corporate merger, consolidation, acquisition of
property or stock, separation, reorganization or liquidation, the Company's
Board of Directors authorizes the issuance or assumption of options in a
transaction to which Section 424(a) of the Code applies, then, notwithstanding
any other provision of the Stock Incentive Plan, the Plan Administrator may
grant options upon such terms and conditions as it may deem appropriate for the
purpose of assuming the old option, or substitution of a new option for the old
option.

In the case of (i) the dissolution or liquidation of the Company, (ii)
merger, reorganization, or consolidation in which the Company is acquired by
another person or entity (other than a holding company formed by the Company),
(iii) the sale of all or substantially all of the assets of the Company to an
unrelated person, or (iv) the sale of all or substantially all of the stock of
the Company to an unrelated person (in each case, a "Fundamental Transaction"),
the Stock Incentive Plan and all unvested awards granted thereunder will
terminate, unless provision is made in connection with the Fundamental
Transaction for the assumption of the awards or the substitution of such awards
with new awards of the successor entity, with appropriate adjustment as to the
number and kind of shares and, if appropriate, the per share exercise price. In
the event of such termination in which the Company's Board of Directors does not
provide for a Cash Purchase Price (as defined below) in connection with the
options, each participant will be notified of such proposed termination and
permitted to exercise options which are then exercisable for a period of at
least fifteen (15) days prior to the date of such termination.

In the event that the Company will be merged or consolidated with
another corporation or entity, other than a corporation or entity which is an
"affiliate" of the Company, under the terms of which the holder of Common Stock
will receive upon consummation thereof a cash payment for each share of Common
Stock of the Company surrendered pursuant to such transaction ("Cash Purchase
Price"), the Company's Board of Directors may provide that all outstanding
options will terminate upon consummation of that transaction and each
participant will receive, in exchange therefor, a cash payment equal to the
amount (if any) by which (i) the Cash Purchase Price multiplied by the number of
shares of Common Stock subject to outstanding options held by such participant
exceeds (ii) the aggregate exercise price of such participant's options.

Change in Control

Unless otherwise provided in a participant's option agreement or in a
written employment or other agreement between the participant and the Company,
the Stock Incentive Plan provides that, in the event the Stock Incentive Plan is
terminated as a result of or following a "Change In Control" (as defined in the
Stock Incentive Plan), all vested options then outstanding at the time of such
termination may be exercised for a period of fifteen (15) days from the date of
notice of the proposed termination. In such event, all participants shall be
credited with an additional six (6) months of service for the purpose of any
otherwise unvested options. Upon a Change In Control in which the Stock
Incentive Plan is either assumed or otherwise not subject to termination, if
during the remaining term of such participant's options or stock award, the
participant is terminated other than for "Cause," the participant will also be
credited with an additional six (6) months of service; provided, however, in the
event of a termination for "Cause," all options will immediately terminate and
all unvested portions of stock awards will immediately terminate.

Amendment and Termination

The Board of Directors may alter, amend, suspend or discontinue the
Stock Incentive Plan, provided that no such action will deprive any person,
without such person's consent, of any rights theretofor granted under the Stock
Incentive Plan.

Tax Withholding

Whenever shares are to be issued or cash is to be paid under the Stock
Incentive Plan, under circumstances in which the Plan Administrator believes
that any federal, state or local tax withholding will be imposed, including FICA
and Medicare withholding tax, the Company shall have the right to require the
participant to remit to the Company an amount sufficient to satisfy federal,
state and local tax withholding requirements. Such withholding requirements may
be paid (i) in cash; (ii) in the discretion of the Plan Administrator, through
the delivery to the Company of previously-owned shares of Common Stock having an
aggregate fair market value equal to the tax obligation (provided that the
previously owned shares delivered in satisfaction of the withholding obligations
must have been held by the participant for at least six (6) months); (iii) in
the discretion of the Plan Administrator, through an election to have the
Company withhold shares of Common Stock otherwise issuable to the participant
having an aggregate fair market value equal to the tax obligation; or (iv) in
the discretion of the Plan Administrator, through a combination of the
procedures set forth in subsections (i)-(iii) above.

Awards Granted to Certain Individuals and Groups

As described above, the number of awards that may be granted to
officers, employees, directors or consultants under the Stock Incentive Plan is
at the discretion of the Plan Administrator and therefore future awards under
the Stock Incentive Plan cannot be determined in advance. The following table
sets forth (a) the total number of shares subject to options granted under the
Stock Incentive Plan to the listed persons and groups through the fiscal year
ended December 31, 2003 and (b) the market value or average per share exercise
price of such options.

Amended and Restated 2000 Stock Incentive Plan
----------------------------------------------

Number of Options Avg. per Share
Name of Individual or Group Granted Exercise Price ($)
----------------------------------------------------------------------------------------------------

Dennis L. Pelino, Chairman and Chief Executive 4,400,000(1) $1.19
Officer

Stephen M. Cohen, Vice President, General Counsel 910,000(2) $0.78
and Secretary

Bohn H. Crain, Chief Financial Officer and 675,000(3) $1.63
Treasurer

Gary A. Koch, Chief Executive Officer of Stonepath 200,000(4) $1.30
Logistics Domestic Services, Inc.

Jason F. Totah, Chief Executive Officer of 250,000(5) $1.90
Stonepath Logistics International Services, Inc.

All current executive officers, as a group 6,518,300 $1.22

All current directors who are not employees, as a 330,000 $0.99
group

All employees who are not current executive 2,026,134(6) $1.65
officers, as a group

_______________________

(1) Does not include the grant to Mr. Pelino on January 23, 2004 of options
to purchase 550,000 shares of the Company's common stock at an exercise
price of $3.05 per share, the grant to Mr. Pelino on February 26, 2004
of options to purchase 125,600 shares of the Company's common stock at
an exercise price of $3.38 per share, or the grant to Mr. Pelino on
March 11, 2004 of options to purchase 359,000 shares of the Company's
common stock at an exercise price of $3.75 per share.

(2) Does not include the grant to Mr. Cohen on January 9, 2004 of options to
purchase 100,000 shares of the Company's common stock at an exercise
price of $2.38 per share.

(3) Does not include the grant to Mr. Crain on January 9, 2004 of options to
purchase 100,000 shares of the Company's common stock at an exercise
price of $2.38 per share or the grant to Mr. Crain on February 26, 2004
of options to purchase 23,300 shares of the Company's common stock at an
exercise price of $3.38 per share.

(4) Does not include the grant to Mr. Koch on January 9, 2004 of options to
purchase 150,000 shares of the Company's common stock at an exercise
price of $2.38 per share.

(5) Does not include the grant to Mr. Totah on January 9, 2004 of options to
purchase 80,000 shares of the Company's common stock at an exercise
price of $2.38 per share or the grant to Mr. Totah on February 26, 2004
of options to purchase 13,100 shares of the Company's common stock at an
exercise price of $3.38 per share.

(6) Includes non-plan options associated with two current employees.
Excludes plan options associated with former director.

Federal Income Tax Consequences

The following summary is based upon an interpretation of the present
Code and applicable treasury regulations and may be inapplicable if such laws
and regulations are changed. Additionally, the following summary is limited to
the impact of the United States federal tax laws upon United States citizens
residing in the United States.

Non-Qualified Stock Options

Under the current applicable provisions of the Code, the recipient of
an option will not recognize income upon the receipt of a grant of non-qualified
stock options and the Company will not be entitled to a tax deduction. When a
non-qualified stock option is exercised, however, the excess of the fair market
value of the shares received over the option price for those shares will be
treated for federal tax purposes as ordinary income. Accordingly, the Company
will be entitled to a corresponding tax deduction in the same amount. Any gain
(or loss) realized on the sale or exchange of any shares actually received will
be treated as long-term or short-term capital gain (or loss), depending on the
applicable holding period.

Incentive Stock Options

With respect to incentive stock options ("ISOs"), no taxable income
will be recognized when the option is granted or exercised; provided, however,
that ISOs exercised more than three (3) months after termination of employment
will be taxed in the same manner as non-qualified stock options described above.
Additionally, when an ISO is exercised, the spread between the fair market value
and the exercise price will be an item of tax preference for purposes of the
alternative minimum tax.

If the shares acquired when an ISO is exercised are held for at least
two (2) years from the grant of the options and one (1) year from the exercise
of the options (the "ISO Holding Period"), any gain (or loss) realized upon
their sale will be treated as long-term capital gain (or loss). In such a case,
the Company will not be entitled to a deduction. If the shares are not held for
the ISO Holding Period, then upon disposition ordinary income will be recognized
in an amount equal to the difference between the exercise price and the fair
market value of the Common Stock on the date the option was exercised, limited,
however to the gain realized on the sale. Any additional gain will be taxed as
capital gain. The Company will be entitled to a deduction equal to the amount of
any ordinary income recognized in this manner.

Stock Awards

The recipient of a stock award will generally recognize ordinary income
equal to the excess of (i) the fair market value of the shares received
(determined as of the date on which the shares become transferable or not
subject to a substantial risk of forfeiture, whichever occurs first) over (ii)
the amount, if any, paid for the shares. Such person may, however, make an
election (the "Tax Election"), within thirty (30) days following the grant of
the stock award, to recognize income at the time of the award based on the fair
market value of the shares on the transfer date. The Company will be entitled to
a deduction in the same amount and at the same time that such person recognizes
ordinary income. The ordinary income recognized by a recipient who is an
employee will be subject to tax withholding by the Company. Upon the sale or
other disposition (including any forfeiture) of the shares awarded, the
recipient will realize capital gain (or loss) measured by the difference between
the amount realized and the fair market value of the shares on the date the
award vested (or on the date of grant if such person made the Tax Election).

Tax Effect for the Company

The Company generally will be entitled to receive a tax deduction in
connection with an award under the Stock Incentive Plan in the amount equal to
the ordinary income realized by the participant and at the time the participant
recognizes such income. As described above, special rules limit the
deductibility of compensation paid to certain executive officers. Under Section
162(m) of the Code, the annual compensation paid to any of the above specified
executives will be deductible only to the extent that it does not exceed
$1,000,000. However, the Company can preserve the deductibility of compensation
in excess of $1,000,000 if it complies with the conditions imposed by Section
162(m). These conditions include stockholder approval of the Stock Incentive
Plan, setting limits on the number of awards that any individual may receive,
and establishing performance criteria that must be met before the award actually
will vest or be paid. The Stock Incentive Plan has been designed to permit the
Plan Administrator to grant options and stock awards which satisfy the
requirements of Section 162(m), thereby permitting the Company to continue to
receive a federal income tax deduction in connection with such awards.

The foregoing discussion is not a complete description of the federal
income tax aspects of options or stock awards under the Stock Incentive Plan. In
addition, administrative and judicial interpretations of the application of the
federal income tax laws are subject to change. Furthermore, no information is
given with respect to state or local taxes that may be applicable to any awards.
Participants in the Stock Incentive Plan who are residents of or are employed in
a country other than the United States may be subject to taxation in accordance
with the tax laws of that particular country in addition to or in lieu of United
States federal income taxes.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE
AMENDMENT TO THE STONEPATH GROUP, INC. AMENDED AND RESTATED
2000 STOCK INCENTIVE PLAN

PROPOSAL 3

RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS THE COMPANY'S
INDEPENDENT AUDITORS FOR THE YEAR ENDING DECEMBER 31, 2004

KPMG LLP has been selected by the Audit Committee and the Board of
Directors to serve as the independent auditors for the Company for the fiscal
year ending December 31, 2004. Representatives of KPMG LLP are expected to be
present at the Meeting to make a statement if they so desire and will be
available to respond to appropriate questions.

The Audit Committee and the Board of Directors will consider the
selection of another accounting firm to serve as the Company's independent
auditors in the event that the stockholders do not approve the selection of KPMG
LLP as the Company's independent auditors.

For the years ended December 31, 2003 and 2002, professional services
were provided to the Company by KPMG LLP. The following table presents fees for
professional services rendered by KPMG LLP for the audit of the Company's annual
financial statements for the years ended December 31, 2003 and December 31,
2002, and fees billed for other services rendered by KPMG LLP during those
periods.

2003 2002
--------- ---------
Audit fees (1) $ 656,883 $ 299,000
Audit related fees (2) 125,000 24,400
Tax fees (3) 73,900 24,400
All other fees -- --
--------- ---------

Total $ 855,783 $ 447,692
========= =========

(1) Represents the aggregate fees billed for the audit of the Company's
annual financial statements and for the reviews of the financial
statements included in the Company's quarterly reports on Form 10-Q.
(2) Represents fees billed for acquisition related services
(3) Represents fees billed for tax consulting services, primarily related
to international acquisitions

Our Audit Committee approves the engagement of our independent auditors to
render audit and non-audit services before they are engaged. All of the services
for which fees are listed above were pre-approved by our Audit Committee.

The Audit Committee has determined the rendering of non-audit services
by KPMG LLP is compatible with maintaining the auditor's independence.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF
KPMG LLP AS THE COMPANY'S INDEPENDENT AUDITORS FOR THE 2004
FISCAL YEAR

SECURITY OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND BENEFICIAL
OWNERS OF GREATER THAN 5% OF THE COMPANY'S VOTING SECURITIES

The following tables set forth information with respect to the
beneficial ownership of Common Stock and Preferred Stock owned, as of March 1,
2004, by:

o the holders of more than 5% of any class of the Company's voting
securities;

o each of the directors;

o each of the executive officers; and

o all directors and executives officers of the Company as a group.

As of March 1, 2004, an aggregate of 39,004,242 shares of Common Stock
and 309,397 shares of Series D Preferred Stock were issued and outstanding. Each
share of Series D Preferred Stock is convertible into 10 shares of our Common
Stock. For purposes of computing the percentages under the following tables, it
is assumed that all options and warrants to acquire Common or Preferred Stock
which have been issued to the directors, executive officers and the holders of
more than 5% of Common or Preferred Stock and are fully vested or will become
fully vested within 60 days from March 1, 2004 have been exercised by these
individuals and the appropriate number of shares of Common Stock and Preferred
Stock have been issued to these individuals.

COMMON STOCK
------------

Shares Owned
Beneficially and Percentage of
Name of Beneficial Owner Position of Record (1) Class
------------------------ -------- ------------- -----

Dennis L. Pelino(2) Officer, Director 3,581,824 8.49%
Stephen M. Cohen(3) Officer 845,878 2.12%
Bohn H. Crain(4) Officer 379,095 *
Thomas L. Scully(5) Officer 46,462 *
Gary A. Koch(6) (7) 595,579 1.52%
Jason F. Totah(8) (9) 202,267 *
David R. Jones(10) Director 142,500 *
Aloysius T. Lawn, IV(11) Director 57,500 *
Robert McCord(12) Director 100,000 *
J. Douglass Coates(13) Director 50,000 *
John H. Springer(14) Director - *

All directors and executive officers as a 6,001,105 13.63%
group (11 people)

__________________________

(*) Less than one percent.

(1) The securities "beneficially owned" by an individual are determined in
accordance with the definition of "beneficial ownership" set forth in
the regulations of the SEC under the Exchange Act. They may include
securities owned by or for, among others, the spouse and/or minor
children of an individual and any other relative who has the same home
as such individual, as well as other securities as to which the
individual has or shares voting or investment power. The number of
shares beneficially owned by the individual may include options to
purchase shares of our common stock exercisable as of, or within 60
days of, March 1, 2004. Beneficial ownership may be disclaimed as to
certain of the securities.

(2) Includes 406,222 shares of common stock held by the Dennis L. Pelino
and Meredith L. Pelino Declaration of Trust, of which Dennis L. Pelino
and his spouse are trustees and beneficiaries, though beneficial
ownership of which may be disclaimed. Also includes 3,175,602 shares of
common stock issuable upon exercise of vested options. Does not include
1,899,998 shares of common stock issuable pursuant to options not
presently exercisable and not exercisable within 60 days of March 1,
2004. Also, does not include options to purchase 359,000 shares of
common stock that were granted after March 1, 2004.

(3) Includes 11,850 shares of common stock. Also includes 834,028 shares of
common stock issuable upon exercise of vested options and options which
vest within 60 days of March 1, 2004. Does not include 175,972 shares
of common stock issuable pursuant to options not presently exercisable
and not exercisable within 60 days of March 1, 2004.

(4) Includes 17,600 shares of common stock. Also includes 361,495 shares of
common stock issuable upon exercise of vested options and options which
vest within 60 days of March 1, 2004. Does not include 436,805 shares
of common stock issuable pursuant to options not presently exercisable
and not exercisable within 60 days of March 1, 2004.

(5) Includes 46,462 shares of common stock issuable upon exercise of vested
options and options which vest within 60 days of March 1, 2004. Does
not include 67,838 shares of common stock issuable pursuant to options
not presently exercisable and not exercisable within 60 days of March
1, 2004.

(6) Includes 458,079 shares of common stock held by the Revocable Trust of
Gary A. Koch, of which Gary A. Koch is the trustee and a beneficiary,
beneficial ownership of which may be disclaimed. Also includes 137,500
shares of common stock issuable upon exercise of vested options and
options which vest within 60 days of March 1, 2004. Does not include
212,500 shares of common stock issuable pursuant to options not
presently exercisable and not exercisable within 60 days of March 1,
2004.

(7) Chief Executive Officer of Stonepath Logistics Domestic Services, Inc.,
a wholly owned subsidiary of the Company.

(8) Includes 202,267 shares of common stock issuable upon the exercise of
vested options and options which vest within 60 days of March 1, 2004.
Does not include 140,833 shares of common stock issuable pursuant to
options not presently exercisable and not exercisable within 60 days of
March 1, 2004.

(9) Chief Executive Officer of Stonepath Logistics International Services,
Inc., a wholly owned subsidiary of the Company.

(10) Includes 85,000 shares of common stock. Also includes 57,500 shares of
common stock issuable upon exercise of vested options and options which
vest within 60 days of March 1, 2004. Does not include 32,500 shares of
common stock issuable pursuant to options not presently exercisable and
not exercisable within 60 days of March 1, 2004.

(11) Includes 57,500 shares of common stock issuable upon the exercise of
vested options and options which vest within 60 days of March 1, 2004.
Does not include 32,500 shares of common stock issuable pursuant to
options not presently exercisable and not exercisable within 60 days of
March 1, 2004.

(12) Includes 100,000 shares of common stock issuable upon the exercise of
vested options and options which vest within 60 days of March 1, 2004.

(13) Includes 50,000 shares of common stock issuable upon the exercise of
vested options and options which vest within 60 days of March 1, 2004.

(14) Does not include 50,000 shares of common stock issuable pursuant to
options not presently exercisable and not exercisable within 60 days of
March 1, 2004.

SERIES D PREFERRED STOCK
------------------------

Shares of
Series D Preferred Stock
Owned Beneficially and
Name of Beneficial Owner of Record (1)(2) Percentage of Class
------------------------ ---------------- -------------------

Brown Simpson Partners I, Ltd.
Carnegie Hall Tower 201,184 65.0%
152 West 57th Street, 21st Fl.
New York, NY 10019

Schottenfeld Associates, L.P.
880 Third Avenue, 16th Floor 25,451 8.2%
New York, NY 10022

CSL Associates LP
399 Park Avenue - 37th Floor 20,119 6.5%
New York, NY 10020

Norton Herrick Irrevocable Securities Trust
20 Community Place, 2nd Floor
Morristown, NY 07960 39,201 12.7%

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

(1) Beneficial ownership has been determined in accordance with Rule 13d-3
under the Securities Exchange Act of 1934. Unless otherwise noted, the
Company believes that all persons named in the table have sole voting
and investment power with respect to all shares of Series D preferred
stock beneficially owned by them.

(2) Each of the shares of Series D preferred stock converts into ten (10)
shares of the Company's common stock. Shares of the Series D preferred
stock have limited voting rights, on an as converted to common stock
basis, in connection with a consolidation, sale or merger of the
Company that could result in a change of control.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Based solely on our review of copies of forms filed pursuant to Section
16(a) of the Securities Exchange Act of 1934, as amended, and written
representations from certain reporting persons, we believe that during fiscal
2003 all reporting persons timely complied with all filing requirements
applicable to them.

REPORT OF THE COMPENSATION COMMITTEE
ON EXECUTIVE COMPENSATION

The Compensation Committee of the Board of Directors (the "Compensation
Committee") consists of three (3) directors who are not employees of the Company
and who are considered "independent" under the rules of The American Stock
Exchange.

Role of the Committee

The Compensation Committee establishes, oversees and directs the
Company's executive compensation programs and policies and administers the
Company's stock option and other long-term incentive plans. The Compensation
Committee seeks to align executive compensation with Company objectives and
strategies, business financial performance and enhanced stockholder value.

The Compensation Committee regularly reviews and approves generally all
compensation and fringe benefit programs of the Company and also reviews and
determines the actual compensation of the Company's executive officers, as well
as all stock option grants and cash incentive awards to all key employees. The
Compensation Committee reviews and administers the Company's Amended and
Restated 2000 Stock Incentive Plan and the Company's 2003 Employee Stock
Purchase Plan.

The Compensation Committee's objectives include (i) attracting and
retaining exceptional individuals as executive officers and (ii) providing key
executives with motivation to perform to the full extent of their abilities, to
maximize Company performance and deliver enhanced value to the Company's
stockholders. The Compensation Committee believes it is important to place a
greater percentage of executive officers' total compensation, principally in the
form of equity, at risk through the grant of stock options whose value is
derived from the performance of the business and value of the Common Stock.
Executive compensation consists primarily of an annual salary, annual bonuses
linked to the performance of the Company and long-term equity-based
compensation.

Compensation

Salary payments in 2003 were made to compensate the ongoing performance
of the Company's executive officers. Bonuses in 2003 were made to recognize
contributions to the Company's business strategy. The Committee's specific
decisions concerning 2003 compensation for each executive officer were made in
light of each officer's level of responsibility and the Committee's judgment
with respect to whether that executive officer's compensation provides
appropriate recognition for performance and an incentive for future performance.

The Compensation Committee took a variety of actions during 2003 to
address the need to recruit and retain executives with relevant industry
experience.

The actions taken by the Compensation Committee during 2003 were
designed to reward the Company's senior management group for their efforts in
successfully implementing the Company's business plan and to provide additional
incentives to continue their efforts to continue to achieve significant growth
in the Company's business and financial performance.

In determining the compensation to be provided to the Company's senior
management group during 2003, the Compensation Committee took into account the
following matters:

o The successful acquisition and integration of the Company's
principal subsidiaries

o The recognition of revenue growth

o The organic growth of the businesses that have been acquired by
the Company

o The success in obtaining additional capital to assist in the
Company's further growth

The Compensation Committee granted to the Company's Chairman and Chief
Executive Officer options to purchase 700,000 shares of Common Stock in March
2003 and 1,034,600 shares of Common Stock in March 2004.

The award of options in March 2003 reflected the philosophy of the
Compensation Committee and Board of Directors that it was important to provide
Mr. Pelino with the opportunity to acquire up to ten percent (10%) of the amount
of the Company's outstanding Common Stock on a fully diluted basis. This
objective was the result of the Compensation Committee's discussions with Mr.
Pelino, its consideration of the advice of an independent compensation
consultant and peer group compensation levels, and its view of Mr. Pelino's
importance to the Company. Part of the options awarded to Mr. Pelino in March
2003 were also provided to him in lieu of a minimum $360,000 cash bonus the
Compensation Committee would have otherwise provided to him under the terms of
his employment agreement and in recognition of his willingness to purchase
100,000 shares of the Company's Common Stock in a private placement at the
request of one of the lead investors.

However, the Compensation Committee and the Board of Directors decided
earlier this year to change the basis for Mr. Pelino's compensation and
abandoned the objective of continuing to provide him with the opportunity to
acquire up to ten percent (10%) of the amount of the Company's outstanding
Common Stock on a fully diluted basis. After reviewing the substantial
contributions made by Mr. Pelino to the Company's growth and the benefits the
Compensation Committee believes can result from his future contributions, the
Compensation Committee extended the term of his employment period through June
2009, the date the earnout period from the Company's most recent acquisition
expires, and increased his salary from its present level of $360,000 per year to
$500,000 per year. This increase was provided to Mr. Pelino in the form of an
award of options to purchase 359,000 shares of Common Stock that vest over the
term of his employment. The Compensation Committee separately determined that
Mr. Pelino was entitled to a bonus for 2003 based upon his performance, peer
group compensation levels, and the advice of an independent financial
consultant. This bonus was provided to Mr. Pelino by awarding him options to
purchase an additional 675,600 shares of Common Stock in lieu of a $1,080,000
cash bonus the Compensation Committee would have otherwise provided to him. The
decision to provide Mr. Pelino with options to purchase Common Stock instead of
the cash payment of his performance bonus for 2003 and the increase in his
annual salary was made after consultation with Mr. Pelino and in an effort to
accommodate his desire to conserve the cash resources of the Company to fund its
continued growth.

The Compensation Committee believes that the foregoing compensation
actions have helped develop a senior management group dedicated to achieving
significant improvement in both the short-term and long-term financial
performance of the Company.

COMPENSATION COMMITTEE OF THE BOARD
OF DIRECTORS
Aloysius T. Lawn, IV, Chairman
David R. Jones
John H. Springer

EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE

The following table sets forth a summary of the compensation paid or
accrued for the three fiscal years ended December 31, 2003 to or for the benefit
of our Chief Executive Officer and our four most highly compensated executive
officers whose total annual salary and bonus compensation exceeded $100,000 (the
"Named Executive Officers").

Long-Term
Annual Compensation Compensation Awards
------------------- -------------------

Restricted
----------
Stock Number of
----- --------- All Other
Name and Principal Position Salary Bonus Awards Options(1) Compensation(2)
--------------------------- ------ ----- ------ ---------- ---------------

Dennis L. Pelino, Chairman 2003 $360,000 -- -- 700,000(3) --
and Chief Executive Officer 2002 $360,000 -- -- 1,900,000(4) --
2001 $158,691 $180,000 -- 1,800,000(5) --

Stephen M. Cohen, Senior 2003 $200,000 $40,000 -- 60,000(6) $62,000
Vice President, General 2002 $200,000 $15,000 -- 100,000(7) $62,000
Counsel and Secretary 2001 $227,884 $50,000 -- 750,000(8) --

Bohn H. Crain, Chief Financial 2003 $200,000 -- -- 325,000(9) --
Officer and Treasurer 2002 $200,000 $37,500 -- 350,000(10) $44,000

Gary A. Koch, Chief Executive 2003 $270,509 -- -- -- --
Officer of Stonepath Logistics 2002 $264,497 -- -- -- --
Domestic Services, Inc. 2001 $69,950 -- -- -- --

Jason F. Totah, Chief Executive 2003 $259,436 $150,000 -- -- --
Officer of Stonepath Logistics 2002 $187,500 $131,250 -- -- --
International Services, Inc.

_______________________

(1) This table does not include options that were granted to the Named
Executive Officers during the first quarter of 2004, as follows:
1,034,600 to Dennis L. Pelino; 100,000 to Stephen M. Cohen; 123,300 to
Bohn H. Crain; 150,000 to Gary A. Koch and 93,100 to Jason F. Totah.

(2) During the periods reflected, certain of the officers named in this
table received perquisites and other personal benefits not reflected in
the amounts of their respective annual salaries or bonuses. The dollar
amount of these benefits did not, for any individual in any year,
exceed the lesser of $50,000 or 10% of the total annual salary and
bonus reported for that individual in any year, unless otherwise noted.

(3) These options were granted on March 10, 2003. The first grant of
300,000 options vested immediately. The second grant of 400,000 options
vest to the extent of 133,334 on the first anniversary date of the
award date and to the extent of 133,333 on the second and third
anniversaries of the award date.

(4) These options were granted on July 3, 2002 and vest to the extent of
633,334 on the first anniversary of the award date and to the extent of
633,333 on the second and third anniversaries of the award date, with
100% acceleration of vesting in the event of a change of control
transaction. These options also vest fully upon death, disability, or
termination of employment without cause.

(5) These options were granted in conjunction with Mr. Pelino's employment
by the Company on June 21, 2001 and are fully vested.

(6) The first grant of 10,000 options occurred on March 25, 2003. One-third
of the options vested on the grant date with the remainder vesting over
the following 24 months. The second grant of 50,000 options occurred on
September 5, 2003. These options vest to the extent of 16,666.66 on the
first, second and third anniversaries of the award date.

(7) These options were granted on July 3, 2002. Twenty-five percent of the
options vest on July 3, 2003 and the remainder vest pro rata over the
following 36 months, with 100% acceleration of vesting following a
change of control transaction.

(8) These options were granted in conjunction with an amendment to Mr.
Cohen's employment agreement during April 2001. They vest pro rata over
the thirty-six (36) month period of his employment through April 2004,
with 100% acceleration of vesting following change of control, or upon
a termination of employment without cause. In the event of death or
disability, the options which would have become vested within the next
12 months become vested.

(9) The first grant of 200,000 options occurred on February 24, 2003.
Twenty-five percent of the options vested on the grant date with the
remainder vesting over the following 36 months. The second grant of
25,000 options occurred on March 25, 2003. One-third of the options
vested on the grant date with the remainder vesting over the following
24 months. The third grant of 100,000 occurred on September 5, 2003.
These options vest to the extent of 33,333.33 on the first and second
anniversaries of the award date and to the extent of 33,333.34 on the
third anniversary of the award date.

(10) 150,000 of these options were granted on January 10, 2002, of which
50,000 vested on January 10, 2003, with the remainder vesting over the
following 24 months and with 100% acceleration of vesting following a
change of control transaction or upon a termination of employment
without cause. 200,000 of these options were granted on July 3, 2002,
of which 50,000 vested on July 3, 2003, with the remainder vesting pro
rata over the following 36 months and with 100% acceleration of vesting
following a change of control transaction, or upon a termination of
employment without cause.

Employment Agreements

On March 11, 2004, we entered into an amended employment agreement with
our Chief Executive Officer, Dennis L. Pelino. This agreement amended our prior
agreements with Mr. Pelino dated February 22, 2002 and June 21, 2001. Pursuant
to this amendment, we have agreed to extend the term of employment of Mr. Pelino
as our Chief Executive Officer through June 2009. The amendment also increased
the annual compensation payable to Mr. Pelino by granting him, in addition to
his current base salary of $360,000, options to purchase 359,000 shares of our
common stock which vest in equal installments over the term of his employment.
This grant of options was intended to provide Mr. Pelino with incremental
compensation of $700,000 over the term of his employment. In addition to his
base salary, Mr. Pelino is entitled to bonus compensation based upon the
achievement of certain target objectives, as well as discretionary merit bonuses
that can be awarded at the discretion of our Board of Directors. Mr. Pelino is
also entitled to certain severance benefits upon his death, disability or
termination of employment. Pursuant to the employment agreement, Mr. Pelino is
also entitled to fringe benefits including participation in pension, profit
sharing and bonus plans, as applicable, and life insurance, hospitalization,
major medical, paid vacation and expense reimbursement.

As of April 19, 2001, we entered into a three-year employment agreement
with our General Counsel, Stephen M. Cohen. This was further modified effective
December 27, 2001. This had the effect of amending and restating our prior
employment agreement with Mr. Cohen entered into in April 2000. Pursuant to this

Agreement, we have agreed to employ Mr. Cohen as our General Counsel through
April 19, 2004 at an annual base salary of $200,000. In addition to his annual
base salary, Mr. Cohen's employment agreement provides for bonus compensation
based upon the achievement of certain target objectives, as well as
discretionary merit bonuses that can be awarded at the discretion of our Board
of Directors. Mr. Cohen is also entitled to certain severance benefits upon his
death, disability or termination of employment. Pursuant to his employment
agreement, Mr. Cohen is entitled to fringe benefits including participation in
pension, profit sharing and bonus plans, as applicable, and life insurance,
hospitalization, major medical, paid vacation and expense reimbursement.

Effective as of February 1, 2003, we entered into an Amended Employment
Agreement with our Chief Financial Officer, Bohn H. Crain. This agreement
amended and restated our prior Agreement with Mr. Crain dated January 10, 2002.
Pursuant to this Agreement, we have agreed to employ Mr. Crain as our Chief
Financial Officer through February 1, 2006 at an annual base salary of $200,000.
In addition to his annual base salary, Mr. Crain's employment agreement provides
for bonus compensation based upon the achievement of certain target objectives,
as well as bonus compensation determined at the discretion of the Board of
Directors. Mr. Crain is also entitled to certain severance benefits upon his
death, disability or termination of employment. Pursuant to his employment
agreement, Mr. Crain is entitled to fringe benefits including participation in
pension, profit sharing and bonus plans, as applicable, and life insurance,
hospitalization, major medical, paid vacation and expense reimbursement.

Change in Control Arrangements

Our Chief Executive Officer, Chief Financial Officer and General
Counsel are each employed under agreements that contain change in control
arrangements. If employment of any of these officers is terminated following a
Change In Control (other than for cause), then we must pay such terminated
employee a termination payment equal to 2.99 times his salary and bonus, based
upon the average annual bonus paid to him prior to termination of his
employment. In addition, all of their unvested stock options shall immediately
vest as of the termination date of their employment due to a Change In Control.
In each of their agreements, a Change In Control is generally defined as the
occurrence of any one of the following:

o any "Person" (as the term "Person" is used in Section 13(d) and
Section 14(d) of the Securities Exchange Act of 1934), except for
the affected employee, becoming the beneficial owner, directly or
indirectly, of our securities representing 50% or more of the
combined voting power of our then outstanding securities;

o a contested proxy solicitation of our stockholders that results in
the contesting party obtaining the ability to vote securities
representing 50% or more of the combined voting power of our
then-outstanding securities;

o a sale, exchange, transfer or other disposition of 50% or more in
value of our assets to another Person or entity, except to an
entity controlled directly or indirectly by us;

o a merger, consolidation or other reorganization involving us in
which we are not the surviving entity and in which our
stockholders prior to the transaction continue to own less than
50% of the outstanding securities of the acquiror immediately
following the transaction, or a plan involving our liquidation or
dissolution other than pursuant to bankruptcy or insolvency laws
is adopted; or

o during any period of twelve (12) consecutive months, individuals
who at the beginning of such period constituted the Board of
Directors cease for any reason to constitute at least a majority
of the Board of Directors unless the election, or the nomination
for election by our stockholders, of each new director was
approved by a vote of at least a majority of the directors then
still in office who were directors at the beginning of the period.

Notwithstanding the foregoing, a "change of control" is not deemed to
have occurred (i) in the event of a sale, exchange, transfer or other
disposition of substantially all of our assets to, or a merger, consolidation or
other reorganization involving, any entity in which the affected employee has,
directly or indirectly, at least a 25% equity or ownership interest; or (ii) in
a transaction otherwise commonly referred to as a "management leveraged
buy-out."

In addition, the existing stock options granted to these executive
officers fully vest upon a "Change In Control," as defined within our Stock
Incentive Plan.

Directors Compensation

Non-employee directors are paid $3,750 per quarter, provided that each
member attends 75% of all meetings. In addition, a quarterly fee of $3,750 is
paid to the chairman of the Audit and Compensation Committees. Upon joining our
Board of Directors, each of our non-employee directors received an option to
purchase 50,000 shares of our common stock with an exercise price equal to the
closing price of our common stock on the trading day prior to the date of grant.
One-half of these options vested on the first anniversary of the director's
membership on the Board, and the balance vest on the second anniversary of Board
membership. On November 5, 2002 each member of our Audit Committee received
options to purchase 15,000 shares of our common stock at an exercise price of
$1.45 per share (of which 50% vested on November 5, 2003 and the balance vest on
November 5, 2004, contingent upon continued Board service). In addition, on
January 23, 2004, the chairmen of each of our Audit Committee and Compensation
Committee received options to purchase 25,000 shares of our common stock at an
exercise price of $3.05 per share (of which 50% vest on January 23, 2005 and the
balance vest on January 23, 2006, contingent upon continued Board service).

Stock Options and Warrants

The following table sets forth information on option grants in fiscal
2003 to the Named Executive Officers.

Option Grants in Last Fiscal Year
---------------------------------

% of Total Potential Realizable Value
Options at Assumed Annual Rates of
Granted to Market Stock Price Appreciation
Number of Employees Price on for Option Term
Options in Fiscal Exercise Date of Expiration ------------------------------
Name Granted Year Price Grant Date 5% 10%
---- ------- ---- ----- ----- ---- -- ---

Dennis L. Pelino 300,000 16.79 $1.68 $1.68 March 2013 $316,963 $803,246
400,000 22.38 $2.00 $1.68 March 2013 294,617 942,995
Stephen M. Cohen 10,000 0.56 $1.81 $1.81 March 2013 11,383 28,847
50,000 2.80 $2.24 $2.24 September 2013 70,436 178,499
Bohn H. Crain 200,000 11.19 $1.53 $1.53 February 2013 192,442 487,685
25,000 1.40 $1.81 $1.81 March 2013 28,457 72,117
100,000 5.60 $2.24 $2.24 September 2013 140,872 356,998
Gary A. Koch -- -- -- -- -- -- --
Jason F. Totah -- -- -- -- -- -- --

The following table sets forth information concerning year-end option
values for fiscal 2003 for the Named Executive Officers. The value of the
options was based on the closing price of our common stock on December 31, 2003
of $2.26.

Fiscal Year End Option Values
-----------------------------

Number of Unexercised Options Value of Unexercised In-the-
Shares at Fiscal Year End Money Options at Fiscal Year End
Acquired on Value ----------------------------- ---------------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
---- -------- -------- ----------- ------------- ----------- -------------

Dennis L. Pelino(1) -- -- 2,733,334 1,666,666 $3,374,001 $1,319,999
Stephen M. Cohen(2) -- -- 707,917 202,083 1,143,292 203,208
Bohn H. Crain(3) -- -- 252,082 422,918 172,270 250,980
Gary A. Koch(4) -- -- 70,833 129,167 68,000 123,999
Jason F. Totah(5) -- -- 112,500 137,500 33,00 57,000

_______________________

(1) Does not include the grant to Mr. Pelino on January 23, 2004 of options
to purchase 550,000 shares of the Company's common stock at an exercise
price of $3.05 per share, or the grant to Mr. Pelino on February 26,
2004 of options to purchase 125,600 shares of the Company's common
stock at an exercise price of $3.38 per share, or the grant to Mr.
Pelino on March 11, 2004 of options to purchase 359,000 shares of the
Company's common stock at an exercise price of $3.75 per share.

(2) Does not include the grant to Mr. Cohen on January 9, 2004 of options
to purchase 100,000 shares of the Company's common stock at an exercise
price of $2.38 per share.

(3) Does not include the grant to Mr. Crain on January 9, 2004 of options
to purchase 100,000 shares of the Company's common stock at an exercise
price of $2.38 per share, or the grant to Mr. Crain on February 26,
2004 of options to purchase 23,300 shares of the Company's common stock
at an exercise price of $3.38 per share.

(4) Does not include the grant to Mr. Koch on January 9, 2004 of options to
purchase 150,000 shares of the Company's common stock at an exercise
price of $2.38 per share.

(5) Does not include the grant to Mr. Totah on January 9, 2004 of options
to purchase 80,000 shares of the Company's common stock at an exercise
price of $2.38 per share, or the grant to Mr. Totah on February 26,
2004 of options to purchase 13,100 shares of the Company's common stock
at an exercise price of $3.38 per share.

Outstanding Stock Options

The Amended and Restated Stonepath Group, Inc. 2000 Stock Incentive
Plan, (the "Stock Incentive Plan") presently covers 13,000,000 shares of common
stock. Under its terms, employees, officers and directors of the Company and its
subsidiaries are currently eligible to receive non-qualified stock options,
restricted stock awards and incentive stock options within the meaning of
Section 422 of the Code. In addition, advisors and consultants who perform
services for the Company or its subsidiaries are eligible to receive
non-qualified stock options under the Stock Incentive Plan. The Stock Incentive
Plan is administered by the Board of Directors or a committee designated by the
Board of Directors.

All stock options granted under the Stock Incentive Plan are
exercisable for a period of up to ten (10) years from the date of grant. The
Company may not grant incentive stock options pursuant to the Stock Incentive
Plan at exercise prices which are less than the fair market value of the common
stock on the date of grant. The term of an incentive stock option granted under
the Stock Incentive Plan to a stockholder owning more than 10% of the issued and
outstanding common stock may not exceed five (5) years and the exercise price of
an incentive stock option granted to such stockholder may not be less than 110%
of the fair market value of the common stock on the date of grant. The Stock
Incentive Plan contains certain limitations on the maximum number of shares of
the common stock that may be awarded in any calendar year to any one individual
for the purposes of Section 162(m) of the Code.

Generally, most of the options under the Stock Incentive Plan are
granted subject to periodic vesting over a period of between three (3) and four
(4) years, contingent upon continued employment with the Company. In addition to
the stock options covered by the Stock Incentive Plan, the Company has
outstanding options to purchase 1,326,700 shares of common stock. The following
schedule identifies the vesting schedule associated with all of the Company's
outstanding options:

Plan Non-Plan Total
---------------- ---------------- ----------------

Vested as of 12/31/03 5,039,597 1,326,700 6,366,297
To vest in 2004 2,324,127 -- 2,324,127
To vest in 2005 1,880,577 -- 1,880,577
To vest in 2006 1,043,916 -- 1,043,916
To vest in 2007 25,417 -- 25,417
---------------- ---------------- ----------------

10,313,634 1,326,700 11,640,334
================ ================ ================

At March 1, 2004, these options were outstanding at the following exercise
prices

Number of Options
---------------------------------------------------------------
Range of
Plan Non-Plan Total Exercise Prices
------------------- --------------- ------------------- ----------------------

3,248,334 1,109,500 4,357,834 $0.50 - $1.00
4,567,100 -- 4,567,100 $1.01 - $2.00
2,498,200 144,000 2,642,200 $2.01 - $4.00
-- 73,200 73,200 $6.38 - $17.00
------------------- --------------- -------------------

10,313,634 1,326,700 11,640,334
------------------- --------------- -------------------

Outstanding Warrants

As of March 1, 2004, warrants to purchase 1,487,563 shares of common
stock were outstanding. Most of these warrants were granted in connection with
investment related transactions. With the exception of warrants to purchase
50,000 shares at $1.23 per share, and warrants to purchase 99,000 shares at
$1.49 per share, all of the remaining warrants are subject to an exercise price
of $1.00 per share and expire in July 2005.

Equity Compensation Plan Information At Fiscal Year End

The following table sets forth information, as of December 31, 2003,
with respect to the Company's stock option plan under which common stock is
authorized for issuance, as well as other compensatory options granted outside
of the Company's stock option plan.

(a) (b) (c)
Number of securities
Number of remaining available
securities to be Weighted-average for future issuance
issued upon exercise price under equity
exercise of of outstanding compensation plan
outstanding options, (excluding securities
options, warrants warrants and reflected in
Plan Category and rights rights column (a))

Equity compensation plans approved by
security holders 8,769,434 $1.27 3,688,067(1)
Equity compensation plans not approved by
security holders 1,834,700 $1.79 --
---------

Total 10,604,134 $1.36 3,688,067
========== ===== =========

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

(1) Does not include options to purchase 542,499 shares of our common stock
under the Company's stock option plan which have been exercised.

PERFORMANCE PRESENTATION

The following graph shows the total stockholder return of an investment
of $100 in cash on December 31, 1998 for the Company's Common Stock and an
investment of $100 in cash on that day for (i) the NASDAQ Market Index, (ii) the
AMEX Market Index and (iii) a peer group consisting of C.H. Robinson Worldwide,
Inc., EGL, Inc., Expeditors International of Washington, Inc., Forward Air
Corporation, and UTi Worldwide Inc. weighted by their market capitalization.
Historic stock performance is not necessarily indicative of future stock price
performance. All values assume reinvestment of the full amount of any dividends
and are calculated daily.

COMPARE CUMULATIVE TOTAL RETURN
AMONG STONEPATH GROUP INC., NASDAQ MARKET INDEX,
AMEX MARKET INDEX AND PEER GROUP INDEX

[Graphic Omitted: Chart]

ASSUMES $100 INVESTED ON DEC. 31, 1998
ASSUMES DIVIDEND REINVESTED
FISCAL YEAR ENDING DEC. 31, 2003

1998 1999 2000 2001 2002 2003

STONEPATH GROUP INC. 100.00 186.00 8.00 29.60 23.20 36.16
PEER GROUP INDEX 100.00 207.97 248.73 235.52 253.60 309.92
AMEX MARKET INDEX 100.00 124.67 123.14 117.47 112.78 153.50
NASDAQ MARKET INDEX 100.00 176.37 110.86 88.37 61.64 92.68

REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS OF
STONEPATH GROUP, INC.

The following is the report of the Audit Committee for the year ended
December 31, 2003. The Audit Committee is composed of three (3) directors, each
of whom meets The American Stock Exchange's independence standards. The Audit
Committee had historically operated under a written charter adopted by the Board
of Directors in 2000. At a meeting held on March 25, 2003, the Board of
Directors adopted a new written charter for the Audit Committee. On January 28,
2004 the Board of Directors amended such written charter for the Audit Committee
which is attached to this Proxy Statement as Exhibit B. The Audit Committee,
which is composed of independent directors, as a whole meets regularly with the
Company's management and independent auditors to discuss the adequacy of the
Company's internal control environment and financial reporting, accounting
matters, audit results, and compliance with its corporate responsibility
program.

In carrying out its responsibilities and fulfilling obligations under
its charter, the Audit Committee, among other things:

o reviewed with the independent auditors their audit plan, audit
scope, and identified audit risks;

o discussed with the independent auditors matters required to be
discussed by Statement on Auditing Standards No. 61,
"Communications with Audit Committees," as modified or
supplemented, including, among other items, matters related to the
conduct of the audit of the Company's consolidated financial
statements;

o obtained from the independent auditors a written statement
describing all relationships between the independent auditors and
the Company that might bear on the auditors' independence,
consistent with Independence Standards Board Standard No. 1,
"Independence Discussions with Audit Committees";

o discussed with the independent auditors any relationships that may
impact their objectivity and independence, and generally satisfied
itself that the auditors are independent;

o reviewed and discussed the Company's audited consolidated
financial statements for the year ended December 31, 2003 with
management and the independent auditors;

o obtained from management the representation that the Company's
consolidated financial statements were prepared in conformity with
accounting principles generally accepted in the United States of
America; and

o discussed with management and the independent auditors the quality
and adequacy of the Company's internal controls.

Based on its review, analysis and discussions with management and the
independent auditors, the Audit Committee recommended to the Company's Board of
Directors (and the Board approved) that the Company's audited consolidated
financial statements for the three years ended December 31, 2003 be included in
the Company's Annual Report on Form 10-K for the year ended December 31, 2003.
The Audit Committee and the Board, in recognition and consideration of the
recommendation of management, have also recommended, subject to shareholder
ratification, the selection of the Company's independent auditors for 2004.

AUDIT COMMITTEE OF THE BOARD
OF DIRECTORS
David R. Jones, Chairman
Aloysius T. Lawn, IV
Robert McCord

Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure

None.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Participation of Chief Executive Officer in Recent Private Placement Transaction

At the request of one of the lead investors, Dennis L. Pelino, our
Chief Executive Officer, purchased 100,000 shares of our common stock at a price
of $1.54 per share in the private placement transaction that was completed on
March 7, 2003. Mr. Pelino's purchase price represented a 14.1% premium over the
purchase price of $1.35 paid by the non-affiliated investors in the transaction.

Payments to Former Executive Officer

During 2002 and 2003, we made aggregate severance payments of $575,000
to Andrew Panzo, a former executive officer, in connection with a December 14,
2001 Separation Agreement in which Mr. Panzo resigned his position as an officer
of the Company. In connection with the Separation Agreement, we also agreed to
cover Mr. Panzo and his family on our medical plan during 2002 and to accelerate
the vesting of the balance of his options to purchase 1,270,000 shares of our
common stock. As of December 14, 2001, Mr. Panzo had already vested in 1,102,500
of these options.

Amendment and Restatement of Employment Arrangements with Executive Officers

increase in the form of additional options that vest over the period of the
employment agreement. On October 18, 2001, we amended the terms of the options
granted to Mr. Pelino under his original employment agreement dated June 21,
2001. We further amended the terms of Mr. Pelino's options on July 3, 2002, when
we accelerated the vesting of his original options to purchase 1,800,000 shares
of our common stock and granted him options to purchase an additional 1,900,000
shares of our common stock.

Effective as of February 1, 2003, we entered into an amended employment
agreement with our Chief Financial Officer, Bohn H. Crain. This agreement
amended and restated our prior agreement with Mr. Crain dated January 10, 2002.

Loans to Executive Officers

In connection with our acquisition of Global on April 4, 2002, we
advanced the sum of $350,000 to Jason Totah. Mr. Totah was a former shareholder
of Global and is an executive officer of the Company, serving as the Chief
Executive Officer of Stonepath Logistics International Services, Inc. The
advance to Mr. Totah is to be repaid through 2006 by offset against the earn-out
amounts that are otherwise due to Mr. Totah under the Stock Purchase Agreement.
The balance of Mr. Totah's advance was $175,000 at December 31, 2003.

Under the terms of our employment agreement with Mr. Cohen, we provided
him with a loan in the principal amount of $100,000 in April 2001. The loan
accrues interest at the rate of 8% per annum and is due on April 17, 2004, or
such earlier date that Mr. Cohen shall have received aggregate proceeds of
$5,000,000 from the sale of his options or the shares of common stock underlying
his options. However, Mr. Cohen is not required to repay the loan if by April
17, 2004, the sum of the proceeds which he has received from the sale of his
options or the shares of common stock underlying his options and the remaining
equity in the options as of April 17, 2004 does not equal or exceed $5,000,000.

Related Party Lease

Air Plus leases certain of its office and warehouse facilities from
Gary Koch. Mr. Koch was a former shareholder of Air Plus and is an executive
officer of the Company, serving as the Chief Executive Officer of Air Plus and
Stonepath Logistics Domestic Services, Inc. The Company paid $187,000 to Mr.
Koch in each of the years ended December 31, 2003 and 2002. Payments under the
lease with Mr. Koch were determined by reference to comparable rents, and
management believes the amounts payable thereunder represent fair market rates.

By Order of the Board of Directors,

Dennis L. Pelino
Chairman of the Board
Dated: April 8, 2004

Exhibit A

STONEPATH GROUP, INC.
Amended and restated 2000 STOCK INCENTIVE PLAN

Section 1. General Purpose of the Plan; Definitions. The purpose of the Plan is
to provide officers, employees, directors and consultants of Stonepath Group,
Inc. (the "Company") and other members of the Participating Company Group the
opportunity to receive stock options and stock awards and thereby acquire a
proprietary interest in the Company. It is anticipated that providing such
persons with a direct stake in the Company's welfare will assure a closer
identification of their interests with those of the Company's stockholders,
thereby encouraging the participants to contribute materially to the growth and
development of the Company and strengthening their desire to remain with the
Company.

The following terms shall be defined as set forth below:

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

"Award" or "Awards," except where referring to a particular category of
grant under the Plan, shall include Incentive Stock Options, Non-Qualified Stock
Options and Stock Awards.

"Board" means the Board of Directors of the Company.

"Cause" means (a) with respect to an individual who is party to a
written agreement with a Participating Company which contains a definition of
"cause" or "for cause" or words of similar import for purposes of termination of
Service thereunder by the Participating Company, "cause" or "for cause" as
defined in such agreement; (b) in all other cases (i) any violation of a law,
rule or regulation other than minor traffic violations, including without
limitation, any violation of the Foreign Corrupt Practices Act; (ii) a breach of
fiduciary duty for personal profit; (iii) fraud, dishonesty or other acts of
misconduct in the rendering of services on behalf of the Company or relating to
the employee's employment; (iv) misconduct by the employee which would cause the
Company to violate any state or federal law relating to sexual harassment or
age, sex or other prohibited discrimination or any violation of written policy
of the Company or any successor entity adopted in respect to such law; (v)
failure to follow Company work rules or the lawful instructions (written or
otherwise) of the Board of Directors of the Company or a responsible executive
to whom the employee directly or indirectly reports, provided compliance with
such directive was reasonably within the scope of the employee's duties and the
employee was given notice that his or her conduct could give rise to termination
and such conduct is not, or could not be, cured within ten (10) days thereafter;
or (vi) any violation of a confidentiality or non-competition agreement or
patent assignment agreement or any agreement relating to the Company's
protection of intellectual property rights.

"Code" means the Internal Revenue Code of 1986, as amended, and any
successor Code, and related rules, regulations and interpretations.

"Effective Date" means the date on which the Plan is approved by the
Board as set forth in Section 18.

"Fair Market Value" of the Stock on any given date means (i) if the
Stock is listed on any established stock exchange or a national market system,
including without limitation the National Market or SmallCap Market of The
Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or system for the last market trading day prior to the time of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable; (ii) if the Stock is regularly traded on the
Nasdaq OTC Bulletin Board Service, or a comparable automated quotation system,
its Fair Market Value shall be the mean between the high bid and low asked
prices for the Stock on the last market trading day prior to the day of
determination; or (iii) in the absence of an established market for the Stock,
the Fair Market Value thereof shall be determined in good faith by the Plan
Administrator.

"Incentive Stock Option" means any Stock Option designated and
qualified as an "incentive stock option" as defined in Section 422 of the Code.

"Non-Qualified Stock Option" means any Stock Option that is not an
Incentive Stock Option.

"Option" or "Stock Option" means any Option to purchase shares of Stock
granted pursuant to Section 6.

"Option Period" means the period commencing on the grant date of an
Option and ending on the last day of the term of such Option as established
pursuant to Section 8.2.

"Participating Company" means the Company or any or Subsidiary or any
other member of the Participating Company Group.

"Participating Company Group" means, at any point in time, any
Participating Company or all corporations collectively which are then
Participating Companies.

"Service" means a participant's employment or service with any member
of the Participating Company Group, whether in the capacity of an employee,
officer, director or a consultant. The participant's Service shall not be deemed
to have terminated merely because of a change in the Participating Company for
which the participant renders such Service, provided that there is no
interruption or termination of the participant's Service. Furthermore, a
participant's Service with the Participating Company Group shall not be deemed
to have terminated if the participant takes any military leave, sick leave, or
other bona fide leave of absence approved by a Participating Company; provided,
however, that if any such leave exceeds ninety (90) days, on the ninety-first
(91st) day of such leave the participant's Service shall be deemed to have
terminated unless the participant's right to return to Service with the
Participating Company is guaranteed by statute or contract.

"Stock" means the Common Stock, par value $.001 per share, of the
Company, subject to adjustments pursuant to Section 11.

"Stock Award" means any award granted pursuant to Section 9.

"Subsidiary" means any, whether now or hereafter existing, corporation
or other entity (other than the Company) in any unbroken chain of corporations
or other entities, beginning with the Company, if each of the corporations or
entities owns stock or other interests possessing 50% or more of the economic
interest or the total combined voting power of all classes of stock or other
interests in one of the other corporations or entities in the chain, whether now
or hereafter existing.

Section 2. Administration. The Plan shall be administered by the full Board of
Directors of the Company or a committee of such Board of Directors comprised of
two or more "Non-Employee Directors" within the meaning of Rule 16b-3(a)(3)
promulgated under the Act (the "Plan Administrator"). Subject to the provisions
of the Plan, the Plan Administrator is authorized to:

(a) construe the Plan and any Award under the Plan;

(b) select the directors, officers, employees and consultants of
any Participating Company to whom Awards may be granted;

(d) determine and modify from time to time the terms and
conditions, including restrictions, of any Award and to
approve the form of written instrument evidencing Awards;

(e) accelerate at any time the exercisability or vesting of all
or any portion of any Award and/or to include provisions in
Awards providing for such acceleration;

(f) impose limitations on Awards, including limitations on
transfer and repurchase provisions;

(g) extend the exercise period within which Stock Options may be
exercised; and

(h) determine at any time whether, to what extent, and under what
circumstances Stock and other amounts payable with respect to
an Award shall be deferred either automatically or at the
election of the participant and whether and to what extent
the Company shall pay or credit amounts constituting interest
(at rates determined by the Plan Administrator) or dividends
or deemed dividends on such deferrals.

The determination of the Plan Administrator on any such matters shall be
conclusive.

Section 3. Delegation of Authority to Grant Awards. In accordance with
applicable laws, the Plan Administrator, in its discretion, may delegate to one
or more executive officers of the Company all or part of the Plan
Administrator's authority and duties with respect to granting Awards and all
references in the Plan to the "Plan Administrator" shall include such executive
officers to the extent they are acting pursuant to such delegation. The Plan
Administrator may revoke or amend the terms of such a delegation at any time,
but such revocation shall not invalidate prior actions of the executive officers
that were consistent with the terms of the Plan.

Section 4. Eligibility. Awards may only be granted to employees, directors, and
consultants with any member of the Participating Company Group. For purposes of
the foregoing sentence, "employees," "directors" and "consultants" shall include
prospective employees, prospective directors and prospective consultants to whom
Awards are granted in connection with written offers of an employment or other
service relationship with a Participating Company.

Section 5. Shares Subject to the Plan. The number of shares of Stock which may
be issued pursuant to the Plan shall be 15,000,000. For purposes of the
foregoing limitation, the shares of Stock underlying any Awards which are
forfeited, canceled, reacquired by the Company, satisfied without the issuance
of Stock or otherwise terminated (other than by exercise) shall be added back to
the number of shares of Stock available for issuance under the Plan. Stock to be
issued under the Plan may be either authorized and unissued shares or shares
held in treasury by the Company. Notwithstanding the foregoing, on and after the
date that the Plan is subject to Section 162(m) of the Code, Stock Options with
respect to no more than 2,500,000 shares of Stock may be granted to any one
individual participant during any one calendar year period.

Section 6. Stock Options. Options granted pursuant to the Plan may be either
Options which are Incentive Stock Options or Non-Qualified Stock Options.
Incentive Stock Options and Non-Qualified Stock Options shall be granted
separately hereunder. The Plan Administrator shall determine whether and to what
extent Options shall be granted under the Plan and whether such Options granted
shall be Incentive Stock Options or Non-Qualified Stock Options; provided,
however, that: (i) Incentive Stock Options may be granted only to employees of
the Company or any Subsidiary that is a "subsidiary corporation" within the
meaning of Section 424(f) of the Code; and (ii) No Incentive Stock Option may be
granted following the tenth anniversary of the Effective Date of the Plan. The
provisions of the Plan and any Stock Option Agreement pursuant to which
Incentive Stock Options shall be issued shall be construed in a manner
consistent with Section 422 of the Code (or any successor provision) and rules
and regulations promulgated thereunder.

Section 7. ISO Fair Market Value Limitation. To the extent that Options
designated as Incentive Stock Options (granted under all stock option plans of
the Participating Company Group, including the Plan) become exercisable by a
participant for the first time during any calendar year for Stock having a Fair
Market Value greater than One Hundred Thousand Dollars ($100,000), the portion
of such Options which exceeds such amount shall be treated as Non-Qualified
Stock Options. For purposes of this Section 7, Options designated as Incentive
Stock Options shall be taken into account in the order in which they were
granted, and the Fair Market Value of Stock shall be determined as of the time
the Option with respect to such Stock is granted. If the Code is amended to
provide for a different limitation from that set forth in this Section 7, such
different limitation shall be deemed incorporated herein effective as of the
amendment date and with respect to such Options as required or permitted by such
amendment to the Code. If an Option is treated as an Incentive Stock Option in
part and as a Nonstatutory Stock Option in part by reason of the limitation set
forth in this Section 7, the participant may designate which portion of such
Option the participant is exercising. In the absence of such designation, the
participant shall be deemed to have exercised the Incentive Stock Option portion
of the Option first. Separate certificates representing each such portion shall
be issued upon the exercise of the Option.

Section 8. Terms of Options. Each Option granted under the Plan shall be
evidenced by an agreement between the Company and the person to whom such Option
is granted (the "Option Agreement") and shall be subject to the following terms
and conditions:

8.1 Exercise Price. Subject to adjustment as provided in
Section 11 of this Plan, the price at which each share covered by an Option may
be purchased shall be determined in each case by the Plan Administrator;
provided, however, that such price shall not, in the case of an Incentive Stock
Option, be less than the Fair Market Value of the underlying Stock at the time
the Option is granted. If a participant owns (or is deemed to own under
applicable provisions of the Code and rules and regulations promulgated
thereunder) more than ten percent (10%) of the combined voting power of all
classes of the stock of the Company and an Option granted to such participant is
intended to qualify as an Incentive Stock Option, the Option price shall be no
less than 110% of the Fair Market Value of the Stock covered by the Option on
the date the Option is granted.

8.2 Exercise Period. Options shall be exercisable at such time
or times, or upon such event or events, and subject to such terms, conditions,
performance criteria, and restrictions as shall be determined by the Plan
Administrator and set forth in the Option Agreement evidencing such Option;
provided, however, that (i) no Option shall be exercisable after the expiration
of ten (10) years after the date of grant of such Option, (ii) no Incentive
Stock Option granted to a participant who owns more than 10% of the combined
voting power of all classes of stock of the Company (or any parent or subsidiary
of the Company) shall be exercisable after the expiration of five (5) years
after the date of grant of such Option, and (iii) no Option granted to a
prospective employee, prospective consultant or prospective director may become
exercisable prior to the date on which such person commences Service with the
Participating Company. Subject to the foregoing, unless otherwise specified by
the Option Agreement evidencing the Option, any Option granted hereunder shall
have a term of ten (10) years from the effective date of grant of the Option.

8.3 Effect of Termination of Service. Unless otherwise
provided in such participant's Option Agreement:

(i) Death. If a participant shall cease to perform
Service as a result of such participant's death,
any Options then exercisable shall be exercisable
until the earlier to occur of one year anniversary
of the participant's death or the expiration of the
Option Period and only by the participant's
personal representative or persons entitled thereto
under the participant's will or the laws of descent
and distribution.

(ii) Termination of Service. If a participant shall
cease to perform Service to any member of the
Participating Company Group, all Options to which
the participant is then entitled to exercise may be
exercised until the earlier to occur of the three
month anniversary of the participant's termination
of Service or the expiration of the Option Period
or, if such termination was due to disability or
retirement (as hereinafter defined), until the
earlier to occur of the one year anniversary of the
participant's termination of Service or the

expiration of the Option Period. Notwithstanding
the foregoing, in the event that any termination of
Service shall be for "Cause" (as defined herein),
then any and all Options held by such participant
shall forthwith terminate upon such termination of
Service. For purposes of the Plan, "retirement"
shall mean the termination of employment with the
Participating Company Group, other than for Cause,
at any time under circumstances which would entitle
such participant to other retirement benefits
provided by the Participating Company to whom the
participant was providing Service immediately prior
to the termination of Service or such other
circumstances that the Plan Administrator concludes
should be deemed a retirement.

(iii) Limitation on Shares. The Option may not be
exercised for more shares (subject to adjustment as
provided in Section 11) after the termination of
the participant's Service than the participant was
entitled to purchase thereunder at the time of the
termination of such relationship.

8.4 Payment of Exercise Price. The Option exercise price of
each share purchased pursuant to an Option shall be paid in full at the time of
each exercise (the "Payment Date") of the Option (i) in cash; (ii) by delivering
to the Company a notice of exercise with an irrevocable direction to a
broker-dealer registered under the Act to sell a sufficient portion of the
shares and deliver the sale proceeds directly to the Company to pay the exercise
price; (iii) in the discretion of the Plan Administrator, through the delivery
to the Company of previously-owned shares of Common Stock having an aggregate
Fair Market Value equal to the Option exercise price of the shares being
purchased pursuant to the exercise of the Option; provided, however, that shares
of Common Stock delivered in payment of the Option price must have been held by
the participant for at least six (6) months in order to be utilized to pay the
Option price; (iv) in the discretion of the Plan Administrator, by an election
to have the Company withhold shares otherwise issuable to the participant having
a Fair Market Value equal to the Option exercise price of the shares being
purchased pursuant to the exercise of the Option; or (v) in the discretion of
the Plan Administrator, through any combination of the payment procedures set
forth in subsections (i)-(iv)

8.5 Nontransferability of Options. No Option shall be
assignable or transferable other than by the laws of descent and distribution.
During the lifetime of the participant, an Option shall be exercisable only by
the participant or, in the event of the participant's incapacity, by the
participant's legal guardian or legal representative.

Section 9. Stock Awards.

(a) The Plan Administrator may grant Stock Awards to any officer,
employee or consultant with any member of the Participating
Company Group. A Stock Award entitles the recipient to
acquire shares of Stock subject to such restrictions and
conditions as the Plan Administrator may determine at the
time of grant ("Stock Award"). Conditions may be based on
continuing employment (or other business relationship) and/or
achievement of pre-established performance goals and
objectives.

(b) Upon execution of a written instrument setting forth the
Stock Award and paying any applicable purchase price, a
participant shall have the rights of a shareholder with
respect to the Stock subject to the Stock Award, including,
but not limited to the right to vote and receive dividends
with respect thereto; provided, however, that shares of Stock
subject to Stock Awards that have not vested shall be subject
to the restrictions on transferability described in Section
9(d) below. Unless the Plan Administrator shall otherwise
determine, certificates evidencing the Stock Awards shall
remain in the possession of the Company until such Stock is
vested as provided in Section 9(c) below.

(c) The Plan Administrator at the time of grant shall specify the
date or dates and/or the attainment of pre-established
performance goals, objectives and other conditions on which
Stock shall become vested, subject to such further rights of
the Company or its assigns as may be specified in the
instrument evidencing the Stock Award. If the participant or
the Company, as the case may be, fails to achieve the
designated goals or the participant's relationship with the
Company is terminated prior to the expiration of the vesting
period, the participant shall forfeit all shares of Stock
subject to the Stock Award which have not then vested.

(d) Unvested Stock may not be sold, assigned transferred, pledged
or otherwise encumbered or disposed of except as specifically
provided herein or in the written instrument evidencing the
Stock Award.

Section 10. Tax Withholding.

(a) Whenever shares of Stock or Options are to be issued or cash
is to be paid under the Plan, under circumstances in which
the Plan Administrator believes that any federal, state or
local tax withholding may be imposed, the Company or
Subsidiary, as the case may be, shall have the right to
require the participant to remit to the Company or
Subsidiary, as the case may be, an amount sufficient to
satisfy the minimum federal, state and local tax withholding
requirements prior to the delivery of any certificate for
shares or any proceeds; provided, however, that in the case
of a participant who receives an Award of Stock under the
Plan which is not fully vested, the participant shall remit
such amount on the first business day following the Tax Date.
The "Tax Date" for purposes of this Section 10 shall be the
date on which the amount of tax to be withheld is determined.
If a participant makes a disposition of Stock acquired upon
the exercise of an Incentive Stock Option within either two
years after the Option was granted or one year after its
exercise by the participant, the participant shall promptly
notify the Company and the Company shall have the right to
require the participant to pay to the Company an amount
sufficient to satisfy federal, state and local tax
withholding requirements.

(b) A participant who is obligated to pay the Company an amount
required to be withheld under applicable tax withholding
requirements may pay such amount (i) in cash; (ii) in the
discretion of the Plan Administrator, through the delivery to
the Company of previously-owned shares of Stock having an
aggregate Fair Market Value on the Tax Date equal to the tax
obligation provided that the previously owned shares
delivered in satisfaction of the withholding obligations must
have been held by the participant for at least six (6)
months; (iii) in the discretion of the Plan Administrator,
through an election to have the Company withhold shares of
Stock otherwise issuable to the participant having a Fair
Market Value on the Tax Date equal to the amount of tax
required to be withheld, or (iv) in the discretion of the
Plan Administrator, through a combination of the procedures
set forth in subsections (i), (ii) and (iii) of this Section
10(b).

(c) An election by a participant to have shares of Stock withheld
to satisfy federal, state and local tax withholding
requirements pursuant to Section 10(b) must be in writing and
delivered to the Company prior to the Tax Date.

Section 11. Adjustment of Number and Price of Shares.

Any other provision of the Plan notwithstanding:

(a) If, through or as a result of any merger, consolidation, sale
of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock
dividend, stock split, reverse stock split or other similar
transaction, the outstanding shares of Stock are increased or
decreased or are exchanged for a different number or kind of
shares or other securities of the Company, or additional
shares or new or different shares or other securities of the
Company or other non-cash assets are distributed with respect
to such shares of Stock or other securities, the Plan
Administrator shall make an appropriate or proportionate
adjustment in (i) the number of Stock Options that can be
granted to any one individual participant, (ii) the number
and kind of shares or other securities subject to any then
outstanding Awards under the Plan, and (iii) the price for
each share subject to any then outstanding Stock Options
under the Plan, without changing the aggregate exercise price
(i.e., the exercise price multiplied by the number of shares)
as to which such Stock Options remain exercisable. The
adjustment by the Plan Administrator shall be final, binding
and conclusive.

(b) In the event that, by reason of a corporate merger,
consolidation, acquisition of property or stock, separation,
reorganization or liquidation, the Board of Directors shall
authorize the issuance or assumption of a stock Option or

stock Options in a transaction to which Section 424(a) of the
Code applies, then, notwithstanding any other provision of
the Plan, the Plan Administrator may grant an Option or
Options upon such terms and conditions as it may deem
appropriate for the purpose of assumption of the old Option,
or substitution of a new Option for the old Option, in
conformity with the provisions of Code Section 424(a) and the
rules and regulations thereunder, as they may be amended from
time to time.

(c) No adjustment or substitution provided for in this Section 11
shall require the Company to issue or to sell a fractional
share under any Option Agreement or share award agreement and
the total adjustment or substitution with respect to each
stock Option and share award agreement shall be limited
accordingly.

(d) In the case of (i) the dissolution or liquidation of the
Company, (ii) a merger, reorganization or consolidation in
which the Company is acquired by another person or entity
(other than a holding company formed by the Company), (iii)
the sale of all or substantially all of the assets of the
Company to an unrelated person or entity, or (iv) the sale of
all of the stock of the Company to a unrelated person or
entity (in each case, a "Fundamental Transaction"), the Plan
and all Awards granted hereunder shall terminate, unless
provision is made in connection with the Fundamental
Transaction for the assumption of the Awards heretofore
granted, or the substitution of such Awards with new awards
of the successor entity, with appropriate adjustment as to
the number and kind of shares and, if appropriate, the per
share exercise price as provided in Subsections (a) and (b)
of this Section 11. In the event of such termination and in
the event the Board does not provide for the Cash Payment
described in Subsection (e) of this Section each participant
shall be notified of such proposed termination and permitted
to exercise for a period of at least 15 days prior to the
date of such termination all Options held by such participant
which are then exercisable.

(e) In the event that the Company shall be merged or consolidated
with another corporation or entity, other than a corporation
or entity which is an "affiliate" of the Company. under the
terms of which holders of Stock of the Company will receive
upon consummation thereof a cash payment for each share of
Stock of the Company surrendered pursuant to such Business
Combination (the "Cash Purchase Price"), the Board of
Directors may provide that all outstanding Options shall
terminate upon consummation of such transaction and each
participant shall receive, in exchange therefor, a cash
payment equal to the amount (if any) by which (i) the Cash
Purchase Price multiplied by the number of shares of Stock of
the Company subject to outstanding Options held by such
participant exceeds (ii) the aggregate exercise price of such
Options.

Section 12. Change in Control.

(a) Unless otherwise provided in such participant's Option
Agreement, agreements relating to Stock Awards or in a
written employment or other agreement directly addressing the
same subject matter as addressed below, in the event that the
Plan is terminated as a result of or following a Change in
Control (as defined herein), all vested Options and Stock
Awards then outstanding at the time of such Plan termination
may be exercised for a period of thirty (30) days from the
date of notice of the proposed termination. In such event,
all participants shall be credited with an additional six (6)
months of service for the purpose of any otherwise unvested
Options and Stock Awards. Upon a Change in Control in which
the Plan is either assumed or otherwise not subject to
termination, if during the remaining term of such a
participant's Options or Stock Awards, the participant is
terminated other than for Cause, the participant will, at the
time of such termination, be credited with an additional six
(6) months of service for the purpose of any otherwise
unvested Options and Stock Awards; however, in the event of a
termination for Cause, all Options shall immediately
terminate and all unvested portions of Stock Awards shall
immediately terminate.

(b) As used herein, a "Change in Control" shall be deemed to have
occurred if: (i) any "person" (as such term is used in
Section 13(d) and 14(d) of the Exchange Act) acquires
"beneficial ownership" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the
Company representing fifty percent (50%) or more of the
voting power of the then outstanding securities of the
Company except where the acquisition is approved by the
Board; or (ii) if the Company is to be consolidated with or
acquired by another entity in a merger or other
reorganization in which the holders of the outstanding voting
stock of the Company immediately preceding the consummation
of such event, shall, immediately following such event, hold,
as a group, less than a majority of the voting securities of
the surviving or successor entity or in the event of a sale
of all or substantially all of the Company's assets or
otherwise.

(c) Notwithstanding anything in the Plan to the contrary, the
acceleration of vesting and exercisability provided by
Subsection (a) of this Section shall not occur in the event
that such acceleration would make the transaction causing the
Change in Control to be ineligible for pooling of interests
accounting treatment, provided pooling of interest treatment
is then still available and, in the absence of such
acceleration, the transaction would qualify for such
treatment and the Company intends to use such treatment with
respect to such transaction.

Section 13. No Right to Future Employment. Nothing contained in the Plan nor in
any Award agreement shall confer upon any participant any right with respect to
the continuance of employment by the Company nor interfere in any way with the
right of the Company to terminate his employment or change his compensation at
any time.

Section 14. Amendment and Discontinuance. The Board of Directors may alter,
amend, suspend or discontinue the Plan, provided that no such action shall
deprive any person without such person's consent of any rights theretofore
granted pursuant hereto.

Section 15. Compliance with Section 16. With respect to persons subject to
Section 16 of the Act, transactions under this Plan are intended to comply with
all applicable conditions of Rule 16b-3 (or its successor rule and shall be
construed to the fullest extent possible in a manner consistent with this intent
). To the extent that any Award fails to so comply, it shall be deemed to be
modified to the extent permitted by law and to the extent deemed advisable by
the Plan Administrator in order to comply with Rule 16b-3.

Section 16. Compliance with Governmental Regulations. Notwithstanding any
provision of the Plan or the terms of any agreement entered into pursuant to the
Plan, the Company shall not be required to issue any shares of Stock hereunder
prior to registration of the shares subject to the Plan under the Securities Act
of 1933 or the Act, if such registration shall be necessary, or before
compliance by the Company or any participant with any other provisions of either
of those acts or of regulations or rulings of the Securities and Exchange
Commission thereunder, or before compliance with other federal and state laws
and regulations and rulings thereunder, including the rules any applicable
exchange or of the Nasdaq Stock Market. The Company shall use its best efforts
to effect such registrations and to comply with such laws, regulations and
rulings forthwith upon advice by its counsel that any such registration or
compliance is necessary.

Section 17. Participation by Foreign Nationals. The Plan Administrator may, in
order to fulfill the purposes of the Plan and without amending the Plan, modify
grants to foreign nationals or United States citizens employed abroad in order
to recognize differences in local law, tax policy or custom.

Section 18. Effective Date of Plan - Shareholder Approval. The Plan was approved
by the Board and became effective on June 1, 2000. Those provisions of the Plan
that for federal tax purposes require approval of the stockholders of the
Company (i.e., the granting of incentive stock options) shall not become
effective until adopted by the stockholders, however, the Company reserves the
right to grant Incentive Stock Options provided stockholder approval is secured
within one (1) year from the date thereof. In the event Incentive Stock Options
are granted and Stockholder approval is not timely secured, such Options shall
remain in full force and effect, however, shall automatically convert to
Non-Qualified Options.

Section 19. Governing Law. The Plan shall be governed by the internal laws of
the State of Delaware without giving effect to its choice of law provisions.
Unless otherwise provided in an Option Agreement or Award Agreement, Awards
shall be governed by the same laws as the Plan.

As amended by the Board of Directors on March 25, 2002, March 25, 2003 and March
11, 2004.

Exhibit B

Stonepath Group, Inc.
Audit Committee Charter

I. Audit Committee Purpose

The Audit Committee is appointed annually by the Board of Directors of Stonepath
Group, Inc. (including its subsidiaries and affiliates, the "Company") to assist
the Board of Directors in fulfilling its oversight responsibilities. The Audit
Committee's primary purpose is to:

o Assist the Board of Directors in fulfilling its fiduciary and oversight
responsibilities relating to the Company's financial reporting standards and
practices and the integrity of the Company's financial statements.

o Oversee the accounting and financial reporting processes of the Company and
the audits of the financial statements of the Company.

o Monitor the adequacy and integrity of the Company's financial statements and
reporting processes and systems of internal controls regarding finance,
accounting, and legal compliance.

o Monitor the independence and performance of the Company's independent
auditor and internal auditing department and the independent auditor's
qualifications and independence.

o Maintain open, direct, and continuing communication among the independent
auditor, management, the internal auditing department, the Audit Committee,
and the Board of Directors.

o Monitor the compliance by the Company with legal and regulatory
requirements.

o Prepare the report required by the rules of the Securities and Exchange
Commission (the "SEC") to be included in the Company's annual proxy
statement.

II. Audit Committee Composition and Meetings

The Audit Committee shall be comprised of at least three directors, all of whom
shall be independent of management, and independent of the Company. Audit
Committee members shall meet the applicable independence and experience
requirements, in effect from time to time, of the SEC and the NASDAQ Stock
Market ("NASDAQ"), American Stock Exchange ("AMEX") or such other applicable
stock exchange or association on which the Company's common stock is then
listed. Director's fees for serving on the Company's Board of Directors and any
board committee thereof shall be the only form of compensation that an Audit
Committee member may receive from the Company.

All Audit Committee members shall be financially literate at the time of
appointment by the Board of Directors to the Audit Committee. Financial literacy
means being able to read and understand fundamental financial statements,
including the Company's balance sheet, income statement, and cash flow
statement.

The Audit Committee Chair shall have the financial sophistication and expertise
required by the regulations of NASDAQ, AMEX or such other applicable stock
exchange or association on which the Company's Common Stock is then listed. In
accordance with the foregoing, if an Audit Committee Chair is not designated or
present, the members of the Audit Committee may designate a Chair by majority
vote of the Audit Committee membership.

Audit Committee members shall be appointed annually by the Board of Directors
and shall serve until their successors are appointed and qualified. The Board of
Directors shall have the power at any time to change the membership of the Audit
Committee and to fill the vacancies in it, subject to such new member(s)
satisfying the independence, experience and financial expertise requirements
referred to above. Except as expressly provided in this Charter or the Company's
by-laws, or as otherwise provided by the rules of NASDAQ, AMEX or such other
applicable stock exchange or association on which the Company's Common Stock is
then listed, the Audit Committee shall fix its own rules of procedure.

The Audit Committee shall meet on at least a quarterly basis, or more frequently
as circumstances dictate. The Audit Committee Chair shall prepare and/or approve
an agenda in advance of each meeting. Audit Committee members may attend
meetings in person, by telephone conference or similar communications equipment,
or as otherwise permitted by law. The Audit Committee shall meet periodically
with management, the internal auditor and the independent auditor in separate
executive sessions. The Audit Committee may request any officer or employee of
the Company or the Company's outside counsel or independent auditor to attend a
meeting of the Audit Committee or to meet with any members of, or consultants
to, the Audit Committee.

III. Audit Committee Responsibilities and Duties

In performing its functions, the Audit Committee shall undertake those tasks and
responsibilities that, in its judgment, would most effectively contribute and
implement the purposes of the Audit Committee. The following functions are some
of the common recurring activities of the Audit Committee in carrying out its
oversight responsibilities:

Review Procedures and Disclosures

1. Review and reassess the adequacy of this Charter at least annually
and recommend any proposed changes to the Board of Directors for
approval. Submit the Charter to the Board of Directors for
approval and have the document published in accordance with
applicable rules promulgated by the SEC, and the regulations of
NASDAQ, AMEX, or such other applicable stock exchange or
association on which the Company's common stock is then listed.

2. Meet periodically in separate sessions with management, the
internal auditors and with the independent auditors.

3. Review and discuss with management and the independent auditor the
Company's annual audited financial statements prior to filing or
distribution, including disclosures made in management's
discussion and analysis, and recommend to the Board of Directors
whether the audited financial statements should be included in the
Company's Form 10-K.

4. Review and discuss with management and the independent auditor the
Company's quarterly financial statements prior to the release of
earnings and the filing of its Form 10-Q, including the results of
the independent auditor's review of the quarterly financial
statements.

5. Review and discuss with the independent auditor the Company's
annual and quarterly financial statements prior to filing,
distribution or incorporation by reference into any registration
statements and/or other periodic or current reports of the
Company.

6. Discuss with management and the independent auditor significant
financial reporting issues and judgments made in connection with
the preparation of the Company's selection or application of
accounting principles, any major issues as to adequacy of the
Company's internal controls and any special steps adopted in light
of material control deficiencies.

7. Discuss with management and the independent auditor any material
accounting adjustments that were noted or proposed by the
independent auditor and that were not adopted by the Company.

8. Review and discuss quarterly and annual reports from the
independent auditor on:

(a) All critical accounting policies and practices to be used.

(b) All alternative treatments of financial information within
GAAP that have been discussed with management, ramifications
of the use of such alternative disclosures and treatments,
and the treatment preferred by the independent auditor.

(c) Other material written communications between the independent
auditor and management, such as any management letter or
schedule of unadjusted differences.

9. Discuss with management the Company's earnings press releases,
including the use of "pro forma" or "adjusted" non-GAAP
information, as well as financial information and earnings
guidance provided to analysts and rating agencies. Such discussion
may be done generally (consisting of discussing the types of
information to be disclosed and the types of presentations to be
made).

10. Discuss with management and the independent auditor the effect of
regulatory and accounting initiatives as well as off-balance sheet
structures on the Company's financial statements.

11. Discuss with the independent auditor the matters required to be
discussed by Statement on Auditing Standards No. 61 relating to
the conduct of the audit, including any significant changes to the
Company's accounting principles, any difficulties encountered in
the course of the audit work, any restrictions on the scope of
activities or access to requested information, and any significant
disagreements with management.

12. Review disclosures made to the Audit Committee by the Company's
CEO and CFO during their certification process for the Form 10-K
and Form 10-Q about any significant deficiencies in the design or
operation of internal controls or material weaknesses therein and
any fraud involving management or other employees who have a
significant role in the Company's internal controls.

13. Consider the integrity of the Company's financial reporting
processes and controls in consultation with management, the
independent auditor and the internal auditors. The Audit Committee
shall discuss any significant financial risk exposures and the
steps management has taken to monitor, control, and report such
exposures, including the Company's risk assessment and risk
management policies. The Audit Committee shall review significant
findings prepared by the independent auditor and the internal
auditing department together with management's responses.

Pre-Approval

14. Pre-approve all auditing services, including attest and review
services, and permitted non-audit services (including the fees and
terms thereof) to be performed for the Company by its independent
auditor, subject to the de minimus exceptions for non-audit
services described in Section 10A(i)(1)(B) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), which are
approved by the Audit Committee prior to the completion of the
audit. The Audit Committee may form and delegate authority to
subcommittees consisting of one or more members when appropriate,
including the authority to grant pre-approvals of audit, including
attest and review services, and permitted non-audit services,
provided that decisions of such subcommittee to grant
pre-approvals shall be presented to the full Audit Committee at
its next scheduled meeting.

15. Review and pre-approve all related party transactions to be
entered into by the Company.

Independent Auditors

16. Appoint, compensate, retain, terminate and oversee the work
(including the resolution of any disagreements between management
and the independent auditor regarding financial reporting) of any
independent auditor engaged for the purpose of preparing or
issuing an audit report or performing other audit, review or
attest services for the Company, subject (if applicable) to
subsequent shareholder ratification. The independent auditor
engaged for the purpose of preparing or issuing an audit report or

performing other audit, review or attest services for the Company
shall be a "registered public accounting firm," as provided in the
Sarbanes-Oxley Act of 2002 and the regulations thereunder, and
shall report directly to the Audit Committee.

17. Obtain from the independent auditors a formal written statement
delineating all relationships between the independent auditor and
the Company, consistent with Independence Standards Board Standard
No.1 (Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committee) and obtain all other the written
disclosures and letters from the independent auditor that may be
required by Independence Standards Board Standard No.1, as it may
be amended or supplemented and discuss with the independent
auditor the independent auditor's independence, including any
relationships or services that may impact the objectivity and
independence of the independent auditor.

18. Take appropriate all other action appropriate to oversee the
independence of the independent auditor.

19. The Audit Committee shall evaluate the qualifications, performance
and independence of the independent auditor, including considering
whether the auditor's quality controls are adequate and the
provision of permitted non-audit services is compatible with
maintaining the auditor's independence, taking into account the
opinions of management and internal auditors. The Audit Committee
shall present its conclusions with respect to the independent
auditor to the Board of Directors.

20. Ensure the rotation of the independent audit partners as required
by law.

21. Meet with the independent auditor prior to the audit to discuss
the planning and staffing of the audit.

Compliance Oversight Responsibilities

22. Obtain from the independent auditor assurance that Section 10A(g)
of the Exchange Act has not been implicated.

23. Obtain reports from management, the Company's senior internal
auditing executive and the independent auditor that the Company
and its subsidiary/foreign affiliated entities are in conformity
with applicable legal requirements and the Company's Code of
Business Conduct and Ethics. The Audit Committee shall review
reports and disclosures of insider and affiliated party
transactions and advise the Board of Directors with respect to the
Company's policies and procedures regarding compliance with
applicable laws and regulations and with the Company's Code of
Business Conduct and Ethics.

24. Establish procedures for the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal
accounting controls or auditing matters, and the confidential,
anonymous submission by employees of concerns regarding
questionable accounting or auditing matters.

25. Discuss with management and the independent auditor any
correspondence with regulators or governmental agencies and any
published reports which raise material issues regarding the
Company's financial statements or accounting policies.

26. Review the fees and other significant compensation to be paid to
the independent auditors.

27. To the extent the Audit Committee is notified by the independent
auditor of special or extraordinary audit issues, review the
independent auditor's audit plan and discuss scope, staffing,
reliance upon management, and internal audit and general audit
approach.

28. Conduct any investigation appropriate to fulfilling its
responsibilities, and have direct access to the independent
auditor as well as anyone in the Company.

Retention of Advisors

29. To the extent it deems necessary or appropriate, have the
authority to retain independent legal, accounting or other
advisors.

30. Receive from the Company appropriate funding, as determined by the
Audit Committee, for (i) payment of compensation to the
independent auditor for the purpose of preparing or issuing an
audit report or related work or performing other audit, review or
attest services for the Company (ii) payment of compensation to
any advisors employed by the Audit Committee, and (iii) ordinary
administrative expenses of the Audit Committee that are necessary
or appropriate in carrying out its duties

Internal Audit Department and Legal Compliance

31. Review the budget, plan, changes in plan (including scope of
internal audit), activities, organizational structure, and
qualifications of the internal audit department, as needed or
appropriate.

32. Review the appointment and performance of, and any decision to
replace, the senior internal audit executive, as needed or
appropriate.

33. Review significant reports prepared by the internal audit
department together with management's response and follow-up to
these reports, as needed or appropriate.

34. On at least an annual basis, review with the Company's counsel,
any legal matters that could have a significant impact on the
organization's financial statements, the Company's system for
monitoring compliance with applicable laws and regulations,
including response to any material inquiries received from
regulators or governmental agencies.

Other Audit Committee Responsibilities

35. Perform any other activities consistent with this Charter, the
Company's by-laws, and governing law, as the Audit Committee or
the Board of Directors deems necessary or appropriate.

36. Periodically report to the Board of Directors on significant
results of the foregoing activities.

IV. Scope of Duties

While the Audit Committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Audit Committee to plan, direct or conduct
audits, or to determine whether the Company's financial statements are complete
and accurate and are in accordance with GAAP. This is the responsibility of
management and the independent auditor.

STONEPATH GROUP, INC.

This Proxy is Solicited on Behalf of the Board of Directors

The undersigned hereby constitutes and appoints Dennis L. Pelino and Stephen M. Cohen, with full power of substitution,
as proxy, to vote for the undersigned all shares of the common stock, par value $.001 per share of Stonepath Group, Inc., a
Delaware corporation (the "Company"), that the undersigned would be entitled to vote if personally present at the Annual Meeting
of Stockholders to be held in the Philadelphia Room of the offices of Buchanan Ingersoll PC, 11 Penn Center, 1835 Market Street,
15th Floor, Philadelphia, Pennsylvania 19103 at 10:00 a.m. local time on Wednesday, May 26, 2004, or at any adjournments thereof,
upon the matters described in the accompanying proxy statement and upon such other matters as may properly come before the
meeting. Said proxy is directed to vote or refrain from voting on the matters set forth in the accompanying proxy statement in the
manner set forth on this proxy.

You are encouraged to specify your choice by marking the appropriate box (SEE REVERSE SIDE), but you need not mark any
box if you wish to vote in accordance with the Board of Directors' recommendations.

THE PROXY CANNOT VOTE YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD
----------------------------------------------------------------------

1. Proposal 1

ELECTION OF DIRECTORS FOR WITHHELD
Nominees: Dennis L. Pelino, J. Douglass Coates, Robert McCord, [ ] [ ]
David R. Jones, Aloysius T. Lawn, IV, John H. Springer

For, except vote withheld for the following nominee(s):

_____________________________________________
_____________________________________________
_____________________________________________
_____________________________________________

This space intentionally left blank

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE APPROVAL OF THE RECOMMENDATIONS OF THE BOARD OF DIRECTORS OF STONEPATH GROUP, INC.

2. Proposal 2

Approval of Amendment to the Company's Amended & Restated FOR AGAINST ABSTAIN
2000 Stock Incentive Plan. [ ] [ ] [ ]

3. Proposal 3

Ratification of the appointment of KPMG LLP to serve as the FOR AGAINST ABSTAIN
auditors for the Company for the fiscal year ending [ ] [ ] [ ]
December 31, 2004.

Check appropriate box Address Change [ ] Name Change [ ]

The undersigned hereby acknowledges receipt of the proxy statement.

PLEASE SIGN, DATE AND RETURN YOUR PROXY PROMPTLY IN THE ENCLOSED
ENVELOPE. NO POSTAGE REQUIRED IF MAILED IN THE UNITED STATES.

NOTE: Please sign name(s) exactly as printed hereon. Joint owners
must each sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such.

SIGNATURE(S) _____________________________________________________

_____________________________________________________

DATE ____________________, 2004

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YOUR VOTE IS IMPORTANT
VOTE TODAY IN ONE OF TWO WAYS:

1. Vote BY INTERNET:
Log-on to www.votestock.com
Enter your control number printed below
Vote your proxy by checking the appropriate boxes
Click on "Accept Vote"

2. VOTE BY MAIL: If you do not wish to vote over the internet, please complete, sign, date and return the above
proxy card in the pre-paid envelope provided.

YOUR CONTROL NUMBER IS:

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| You may vote over the internet 24 hours a day, 7 days a week. |
| Your internet vote authorizes the named Proxies to vote in the same manner as if you |
| marked, signed and returned your proxy card. |
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