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                                                                   EXHIBIT 10.78


                                SUBSCRIPTION NOTE

$______________
                                                          Minneapolis, Minnesota
                                                                   July __, 2001


THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR UNDER APPLICABLE STATE SECURITIES LAWS. THIS NOTE HAS BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND SUCH STATE LAWS OR PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE LAWS, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY
WHOSE AUTHORIZED OFFICER HAS SIGNED THIS NOTE ABOVE.

     FOR VALUE RECEIVED, United Shipping & Technology, Inc., a Utah corporation,
(the "Company"), promises to pay to the order of ____________________ (together,
the "Holder"), at Holder's address specified in the Subscription Note Agreement
of even date, or at such other place as Holder may designate in writing from
time to time, the principal sum of ____________________ dollars ($__________),
in lawful money of the United States. Unless converted pursuant to Section 3
hereof, all outstanding principal on this Note shall be due and payable on
------------, ----.

     1. Subscription Note Purchase Agreement. This Note has been issued pursuant
to and is subject to the terms and provisions of a Subscription Note Purchase
Agreement (the "Agreement"), dated as of the date hereof, between the Company
and the Holder, and this Note and the Holder are entitled to all the benefits
provided for in the Agreement. The provisions of the Agreement are incorporated
herein by reference with the same force and effect as if fully set forth herein.

     2. Conversion. Prior to payment of the principal amount of this Note by the
Company, this Note may be converted as follows:

          (a) Automatic Conversion. Subject to the Company having obtained the
     approval of its shareholders pursuant to Section 2 of the Agreement, and
     the contingencies have been fulfilled pursuant to Section 3 of the
     Agreement, all of the principal balance of this Note shall be converted
     into shares of the Company's Series F Convertible Preferred Stock
     ("Conversion Shares"). The Company shall notify the Holder when such
     shareholder approval has been obtained, when the contingencies have been
     obtained, and of the automatic conversion into the Conversion Shares.
     Following the issuance of the Conversion Shares, this Note shall be deemed
     satisfied.

          (b) Conversion Procedure. Upon receipt of a conversion notice from the
     Company, Holder shall surrender this Note against delivery of the
     Conversion Shares. The number of shares issuable upon conversion shall be
     equal to the quotient of the amount converted divided by the Conversion
     Price. As promptly as possible thereafter, the Company shall issue and
     deliver to the Holder a certificate representing the number of Conversion
     Shares into which this Note has been converted. Thereupon, this Note, or
     the portion hereof converted, shall be deemed to have been satisfied and
     discharged, and the Conversion Shares into which this Note shall be so
     converted shall be fully paid and nonassessable shares. In the event a
     conversion results in the issuance of a fractional share, the Holder shall
     receive, in lieu thereof, cash payment based upon the Conversion Price. If
     less than the entire principal balance of this Note is converted, the
     Company shall deliver to the Holder a new Note of like tenor for the
     unconverted principal balance.
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          (c) Conversion Price. The Conversion Price shall be $.55 per share.

          (d) Adjustments. The Conversion Price and the number of shares into
     which the Note may be converted shall be appropriately adjusted to reflect
     any stock split, stock dividend, merger, reorganization, or similar action
     affecting the outstanding stock of the Company.

     3. Payment of Interest. This Note shall not bear any Interest.

     4. Investment Intent. Neither this Note, the Common Stock of the Company
nor the Conversion Shares have been registered under the Securities Act of 1933,
as a amended (the "Securities Act"), or under applicable state securities laws.
Other than pursuant to registration under federal and any applicable state
securities laws or an exemption from such registration, the availability of
which the Company shall determine in its sole discretion, neither this Note nor
any Conversion Shares may be sold, pledged, or otherwise disposed of unless the
Company has received from the transferee hereof such representations and
agreements as the Company shall determine in its sole discretion may be
necessary to permit such transfer, and the Company shall determine that such
transfer will not violate applicable securities laws. The Holder, by acceptance
hereof, agrees to give written notice to the Company before transferring this
Note or any Conversion Shares of the Holder's intention to do so, describing the
manner of any proposed transfer. Within 30 days after receiving written notice,
the Company shall notify the Holder as to whether such transfer may be effected
and of the conditions to any such transfer.

     5. Notices. All demands and notices to be given hereunder shall be
delivered or sent by certified mail, return receipt requested; or by courier, in
the case of the Company, to its corporate headquarters at 9850 51st Avenue
North, Suite 110, Minneapolis, Minnesota 55442, and in the case of the Holder,
addressed to the address provided in the Agreement.

     6. Miscellaneous. This Note shall be governed by the law of the State of
Minnesota, without application of conflicts of law principles. This Note shall
be binding upon, and enforceable in accordance with its terms against, the
Company and its successors and assigns.

     7. Severability. If at the time of enforcement of this Note, a Court shall
hold that any provision or rate or term stated herein is unreasonable under the
circumstances then existing, the Company agrees that a provision deemed
reasonable by the Court shall be substituted for such provision or rate or term
and the Court shall be allowed to so revise such provision.

     8. Subordination. NOTE: any capitalized terms used in this Section and not
otherwise defined in this Note shall have the meaning set forth in the Senior
Credit Agreement.

     Notwithstanding anything in this Note to the contrary, all indebtedness
evidenced by this Note shall be subordinate and junior to the Senior Debt. The
Company shall not make and the Holder shall not be permitted to ask, demand, sue
for or receive, by setoff, or otherwise, any payment hereunder; provided, that
so long as no Event of Default (as defined in the Senior Credit Agreement)
exists or would be caused thereby, the Company may pay and the Holder may
receive, regularly scheduled interest payments pursuant to this Note. After the
payment in full of all Senior Debt, the Holder shall be subrogated to the rights
of the holders of Senior Debt to receive payments or distributions of assets of
the Company payable or distributable to the holders of Senior Debt, until this
Note shall be paid in full, and as between the Company and the Holder, any such
payment by virtue of the subrogation herein provided for shall be deemed to be a
payment by the Company on account of this Note. No right of any present or
future holder of Senior Debt to enforce subordination as herein provided shall
at any time in any way be prejudiced or impaired by any act or failure to act on
the part of the Company, or by any act or failure to act in good faith by any
such holder, or by any noncompliance by the Company, with the terms, provisions
and covenants of any agreement relating to Senior Debt, regardless of any
knowledge thereof any such holder may have or be otherwise charged with.


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     In the event of any distribution, division or application, partial or
complete, voluntary or involuntary, by operation of law or otherwise, of all or
any part of the assets of the Company or the proceeds thereof to the creditors
of the Company or readjustment of the obligations and indebtedness of the
Company, whether by reason of liquidation, bankruptcy, arrangement,
receivership, assignment for the benefit of creditors or any other action or
proceeding involving the readjustment of all or any part of the indebtedness
evidenced by this Note, or the application of the assets of the Company to the
payment or liquidation thereof, or upon the dissolution, liquidation, cessation
or other winding up of the Company's business, or upon the sale of all or
substantially all of the Company's assets, then, and in any such event (i) the
Lenders shall be entitled to receive payment in full of any and all of the
Senior Debt then owing prior to the payment of all or any part of the
indebtedness evidenced by this Note, and (ii) any payment or distribution of any
kind or character, whether in cash, securities or other property, which shall be
payable or deliverable upon or with respect to any or all of the indebtedness
evidenced by this Note shall be paid or delivered directly to Agent, for the
benefit of itself and the Lenders, for application on any of the Senior Debt,
due or not due, until such Senior Debt shall have first been fully paid and
satisfied. In order to enable Agent to enforce its rights hereunder in any of
the aforesaid actions or proceedings, Agent is hereby irrevocably authorized and
empowered, in its discretion, to make and present for and on behalf of the
Holder such proofs of claim against the Company on account of the indebtedness
evidenced by this Note as Agent may deem expedient or proper and to vote such
proofs of claim in any such proceeding and to receive and collect any and all
dividends or other payments or disbursements made thereon in whatever form the
same may be paid or issued and to apply the same on account of any of the Senior
Debt. the Holder irrevocably authorizes and empowers Agent, for the benefit of
itself and the Lenders, to demand, sue for, collect and receive each of the
aforesaid payments and distributions and give acquittance therefor and to file
claims and take such other actions, in Agent's own name or in the name of the
Holder or otherwise, as Agent may deem necessary or advisable for the
enforcement of this Note; and the Holder will execute and deliver to Agent, for
the benefit of itself and the Lenders, such powers of attorney, assignments and
other instruments or documents, including notes (together with such assignments
or endorsements as Agent shall deem necessary) as may be requested by Agent in
order to enable Agent to enforce any and all claims upon or with respect to any
or all of the indebtedness evidenced by this Note and to collect and receive any
and all payments and distributions which may be payable or deliverable at any
time upon or with respect to the indebtedness evidenced by this Note, all for
Agent's own benefit. Following payment in full of the Senior Debt, the Lenders
will remit to the Holder, to the extent of each of its interests therein, all
dividends or other payments or distributions paid to and held by it in excess of
the Senior Debt.

     Should any payment or distribution or security, or the proceeds of any
thereof, be collected or received by the Holder which is required to be paid to
Agent, for the benefit of itself and the Lenders, under the terms hereof, the
Holder will forthwith deliver the same to Agent, for the benefit of itself and
the Lenders, in precisely the form received (except for the endorsement without
recourse or the assignment without recourse of the Holder where necessary) and,
until so delivered, the same shall be held in trust by the Holder as the
property of the Agent, for the benefit of itself and the Lenders.

     The provisions of this Note are for the benefit of Agent and Lenders and
may be enforced directly by such entities against the Holder. The Holder
acknowledges and agrees, by acceptance hereof, that Agent and Lenders have
relied upon and will continue to rely upon the subordination provided for herein
in making the extensions of credit to the Company. The Holder hereby waives
notice of or proof of reliance hereon.

     The holders of Senior Debt may at any time and from time to time, without
the consent of or notice to the Holder, without incurring responsibility to the
Holder and without impairing or releasing the subordination provided herein or
the obligations hereunder of the Holder to such holders (i) change the manner,
place or terms of payment or extend the time of payment of, or renew or alter,
all or any of the Senior Debt, or otherwise amend or supplement in any manner,
or grant any waiver or release with respect to, Senior Debt or any instrument
evidencing the same (including, without limitation, the Senior Credit
Agreement), (ii) sell, exchange, release, not perfect or otherwise deal with any
property at any time


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pledged, assigned or mortgaged to secure or otherwise securing, Senior Debt, or
amend or grant any waiver or release with respect to, or consent to any
departure from any guarantee for all or any of the Senior Debt, (iii) exercise
or refrain from exercising any rights against the Company and any other person,
and (iv) apply any sums from time to time received to the Senior Debt.

     The provisions of this Section shall remain in full force and effect
irrespective of (i) any lack of validity or enforceability of the Senior Credit
Agreement or Senior Debt, or (ii) any other circumstances that might otherwise
constitute a defense available to, or a discharge of Holder.

     The subordination provisions contained in this Section are solely for the
benefit of the holders of Senior Debt and may not be rescinded, canceled,
amended or modified in any way without the prior written consent thereto of such
holders.

     The provisions of this Section shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the Senior
Debt is rescinded or must otherwise be returned by any holder of Senior Debt
upon the insolvency, bankruptcy or reorganization of the Company or otherwise,
all as though such payment had not been made.

     9. Definitions. When used herein the following terms shall have the
following meanings:

     "Senior Debt" shall mean all amounts due and payable under the Senior
Credit Agreement and any guaranty thereof, whether outstanding as of the date of
this Note or incurred after this Note, including, without limitation, all
principal, interest, prepayment premiums, fees and expenses incurred under the
Senior Credit Agreement and any guaranty thereof. Without limiting the
foregoing, Senior Debt includes interest accruing after the commencement of
bankruptcy proceedings by or against The Company, regardless of whether allowed
by the court.

     "Senior Credit Agreement" shall mean the Credit Agreement dated as of
September 24, 1999, among Velocity Express, Inc. f/k/a UST Delivery Systems,
Inc., General Electric Capital Corporation, as a lender and as agent ("Agent")
for certain other lenders (collectively, the "Lenders"), and the other Credit
Parties signatory thereto, and all renewals, extensions, refinancings,
refundings, amendments and modification thereof.

     IN WITNESS WHEREOF, the Company has caused this Note to be executed on its
behalf by its duly authorized officer; on the day and year first above written.


                                       United Shipping & Technology, Inc.



                                       By:
                                           -------------------------------------
                                           Chief Executive Officer


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