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EXHIBIT 10.5.3
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                          REGISTRATION RIGHTS AGREEMENT

      THIS REGISTRATION RIGHTS AGREEMENT, dated as of December 4, 2000 (this
"Agreement"), is made by and between STRATUS SERVICES GROUP, INC., a Delaware
corporation (the "Company"), and the parties who, from time to time, execute a
Buyer signature page in the form annexed hereto as Exhibit A (the "Buyers").

                             W I T N E S S E T H:

      WHEREAS, upon the terms and subject to the conditions of a certain
Securities Purchase Agreement dated as of December 1, 2000, between the Buyers
and the Company (the "Securities Purchase Agreements"), the Buyers have
subscribed to purchase or have purchased from the Company 6% Convertible
Debentures of the Company (collectively, the "Debentures"), and, in the case of
a certain Buyer, certain common stock purchase warrants (the Warrants"), which
Debentures and Warrants will be convertible and exercisable, as the case may be,
into shares of the common stock, $.01 par value (the "Common Stock"), of the
Company (the "Underlying Shares") upon the terms and subject to the conditions
of such Debentures and Warrants; and

      WHEREAS, the Debentures subscribed for or purchased by Buyers comprise
part of a series of up to $3,000,000 of Debentures which have been offered by
the Company pursuant to a private offering conducted by the Company (the
"Private Offering");

      WHEREAS, to induce the Buyers to execute and deliver the Securities
Purchase Agreements, the Company has agreed to provide certain registration
rights under the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the
"Securities Act"), with respect to the Underlying Shares;

      NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Buyer hereby
agree as follows:

1.    DEFINITIONS.

      (a)   As used in this Agreement, the following terms shall have the
            following meanings:

            (i)   "Investors" means the Buyers who acquire Debentures pursuant
                  to the Securities Purchase Agreement and Private Offering and
                  any permitted


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                  transferee or assignee who agrees to become bound by the
                  provisions of this Agreement in accordance with Section 9
                  hereof.

            (ii)  "Initial Closing Date" means the closing of the first sale of
                  Debentures under the Securities Purchase Agreement pursuant to
                  the Private Offering.

            (iii) "Register," "Registered," and "Registration" refer to a
                  registration effected by preparing and filing a Registration
                  Statement or Statements in compliance with the Securities Act
                  and pursuant to Rule 415 under the Securities Act or any
                  successor rule providing for offering securities on a
                  continuous basis ("Rule 415"), and the declaration or ordering
                  of effectiveness of such Registration Statement by the United
                  States Securities and Exchange Commission (the "SEC").

            (iv)  "Potential Material Event" means any material acquisition,
                  disposition, business combination or other material
                  transaction of the Company that would, in the opinion of
                  Company counsel, be required to be disclosed publicly if such
                  disclosure would be premature and would in the opinion of the
                  Company, adversely effect such transaction.

            (v)   "Registrable Securities" means the Underlying Shares issuable
                  upon conversion of Debentures and exercise of the Warrant and
                  shares issued as payment of interest due under the Debentures.

            (vi)  "Registration Statement" means a registration statement of the
                  Company under the Securities Act.

      (b)   Capitalized terms used herein and not otherwise defined herein shall
            have the respective meanings set forth in the Securities Purchase
            Agreement.

2.    REGISTRATION.

      (a)   MANDATORY REGISTRATION.  (1) The Company shall prepare and file
            with the SEC, as soon as reasonably practicable after the date
            hereof, under the Securities Purchase Agreement, a Registration
            Statement on Form S-1 registering for resale by the Investors the
            Registrable Securities the time of filing of the Form S-1, which
            shall contain the "Plan of Distribution" attached hereto as ANNEX
            A, which Registration Statement shall be declared effective no
            later than 120 days after the Initial Closing Date. The Company
            will prepare and file the Registration Statement with the SEC by
            the 60th day following the Initial Closing Date.  The initial
            Registration Statement shall include for the benefit of the
            holders of the Debentures and Warrants not less than a number of
            shares equal to the sum of (i) the number of shares of Common
            Stock issuable upon the exercise in full of the Warrants and (ii)
            200% of the number of shares of Common Stock issuable upon


                                      -2-
<PAGE>

            conversion in full of the Debentures at the Conversion Price (as
            defined in the Debentures) in effect on the Initial Closing Date,
            the date of filing of the Registration Statement or the date that
            the request for acceleration of the effectiveness of the
            Registration Statement is made with the SEC (whichever yields the
            lowest Conversion Price), assuming for such purposes that the
            Debentures will be outstanding for five years and that all
            interest will be paid in shares of Common Stock.  In the event
            that the Company prepays the full principal and interest under
            the outstanding Debentures prior to April 1, 2001, the Company
            shall have no obligation hereunder to cause to be declared
            effective a Registration Statement or to keep any Registration
            Statement effective. In addition, the Company shall have no
            obligation to keep a Registration Statement effective after it
            pays the full redemption price for all the outstanding Debentures.

            (2) The Company shall file additional Registration Statements within
            60 days of a notice from the Investors, and shall cause such
            additional Registration Statements to be effective within 120 days
            of such notice, if the number of Registrable Securities at any time
            exceeds 85% of the number of shares of Common Stock then registered
            in all their existing Registration Statements hereunder.

      (b)   PAYMENTS BY THE COMPANY.  If the Registration Statement covering
            the Registrable Securities required to be filed by the Company
            pursuant to Section 2(a) hereof is not effective within one
            hundred twenty (120) days following the Initial Closing Date (the
            "Required Effective Date"), or after a Suspension Period (except
            as provided by the last sentence of section 2a), then the Company
            will make payments to each Buyer in such amounts and at such
            times as shall be determined pursuant to this Section 2(b).  The
            amount to be paid by the Company to each Buyer shall be
            determined as of each Computation Date, and such amount shall be
            equal to two (2%) percent of the cash purchase price paid by such
            Buyer for all Debentures then purchased by such Buyer and
            outstanding pursuant to the Securities Purchase Agreement for any
            period from the Required Effective Date to each Computation Date
            thereafter, until the Registration Statement is declared
            effective by the SEC (the "Periodic Amount").  The full Periodic
            Amount shall be paid by the Company in immediately available
            funds within three business days after each Computation Date.

            As used in this Section 2(b), the term "Computation Date" means the
            date which is thirty (30) days after the Required Effective Date,
            and, if the Registration Statement required to be filed by the
            Company pursuant to Section 2(a) has not theretofore been declared
            effective by the SEC, each date which is thirty (30) days after the
            previous Computation Date (pro rated for partial periods) until such
            Registration Statement is so declared effective.




                                      -3-
<PAGE>


3.    OBLIGATIONS OF THE COMPANY.  In connection with the registration of the
      Registrable Securities, the Company shall do each of the following.

      (a)   Prepare and file with the SEC a Registration Statement with
            respect to not less than the number of Registrable Securities
            provided in Section 2(a), above, and thereafter use its
            reasonable best efforts to cause each Registration Statement
            relating to Registrable Securities to become effective no later
            than one hundred twenty (120) days following the Initial Closing
            Date, and keep the Registration Statement effective at all times
            until the earliest (the "Registration Period") of (i) the date
            when the Investors may sell all Registrable Securities issued or
            issuable under the Debentures and the Warrants under Rule 144(k)
            (including by use of cashless or net exercise with respect to
            Warrant Shares) or (ii) the date the Investors no longer own any
            of the Registrable Securities, which Registration Statement
            (including any amendments or supplements thereto and prospectuses
            contained therein) shall not contain any untrue statement of a
            material fact or omit to state a material fact required to be
            stated therein or necessary to make the statements therein, in
            light of the circumstances in which they were made, not
            misleading;

      (b)   Prepare and file with the SEC such amendments (including
            post-effective amendments) and supplements to the Registration
            Statement and the prospectus used in connection with the
            Registration Statement as may be necessary to keep the
            Registration Statement effective at all times during the
            Registration Period, and, during the Registration Period, comply
            with the provisions of the Securities Act with respect to the
            disposition of all Registrable Securities of the Company covered
            by the Registration Statement until such time as all of such
            Registrable Securities have been disposed of in accordance with
            the intended methods of disposition by the seller or sellers
            thereof as set forth in the Registration Statement;

      (c)   The Company shall permit a single firm of counsel designated by the
            Buyer to review the Registration Statement and all amendments and
            supplements thereto at least four Business Days prior to their
            filing with the SEC, and not file any document in a form to which
            such counsel reasonably objects;

      (d)   Furnish to each Investor whose Registrable Securities are
            included in the Registration Statement and its legal counsel
            identified to the Company (i) promptly after the same is prepared
            and publicly distributed, filed with the SEC, or received by the
            Company, one (1) copy of the Registration Statement, each
            preliminary prospectus and prospectus, and each amendment or
            supplement thereto, and (ii) such number of copies of a
            prospectus, and all amendments and supplements thereto and such
            other documents, as such Investor may reasonably request in order
            to facilitate the disposition of the Registrable Securities owned
            by such Investor;



                                      -4-
<PAGE>

      (e)   On the Business Day that it occurs notify each Investor of the
            happening of any event of which the Company has knowledge, as a
            result of which the prospectus included in the Registration
            Statement, as then in effect, includes an untrue statement of a
            material fact or omits to state a material fact required to be
            stated therein or necessary to make the statements therein, in
            light of the circumstances under which they were made, not
            misleading, and use its best efforts promptly to prepare a
            supplement or amendment to the Registration Statement or other
            appropriate filing with the SEC to correct such untrue statement
            or omission, and deliver a number of copies of such supplement or
            amendment to each Investor as such Investor may reasonably
            request;

      (f)   As promptly as practicable after becoming aware of such event,
            notify each Investor who holds Registrable Securities being sold
            (or, in the event of an underwritten offering, the managing
            underwriters) of the issuance by the SEC of a Notice of
            Effectiveness or any notice of effectiveness or any stop order or
            other suspension of the effectiveness of the Registration Statement
            at the earliest possible time;

      (g)   Notwithstanding the foregoing, if at any time or from time to
            time after the date of effectiveness of the Registration
            Statement, the Company notifies the Investors in writing of the
            existence of a Potential Material Event, the Investors shall not
            offer or sell any Registrable Shares under the Registration
            Statement, from the time of the giving of notice with respect to
            a Potential Material Event until such Investor receives written
            notice from the Company that such Potential Material Event either
            has been disclosed to the public or no longer constitutes a
            Potential Material Event; PROVIDED, HOWEVER, that the Company may
            not so suspend the right to such holders of Registrable Shares
            for more than two twenty (20) day periods in the aggregate during
            any 12-month period ("Suspension Period") with at least a ten
            (10) business day interval between such periods, during the
            periods the Registration Statement is required to be in effect,
            and PROVIDED FURTHER, HOWEVER, that a notice will not be given
            pursuant to a Potential Material Event if such notice has been
            given before ;

      (h)   Provide a transfer agent and registrar, which may be a single
            entity, for the Registrable Securities not later than the effective
            date of the Registration Statement;

      (i)   Cooperate with the Investors who hold Registrable Securities
            being offered to facilitate the timely preparation and delivery
            of certificates for the Registrable Securities to be offered
            pursuant to the Registration Statement and enable such
            certificates for the Registrable Securities to be in such
            denominations or amounts as the case may be, as the Investors may
            reasonably request, and, within three (3) business days after a
            Registration Statement which includes Registrable Securities



                                      -5-
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            is ordered effective by the SEC, the Company shall deliver, and
            shall cause legal counsel selected by the Company to deliver, to the
            transfer agent for the Registrable Securities (with copies to the
            Investors whose Registrable Securities are included in such
            Registration Statement) an appropriate instruction and opinion of
            such counsel; and

      (j)   Take all other reasonable actions necessary to expedite and
            facilitate disposition by the Investor of the Registrable Securities
            pursuant to the Registration Statement.

4.    OBLIGATIONS OF THE INVESTORS.  In connection with the registration of
      the Registrable Securities, the Investors shall have the following
      obligations:

      (a)   It shall be a condition precedent to the obligations of the
            Company to complete the registration pursuant to this Agreement
            with respect to the Registrable Securities of a particular
            Investor that such Investor shall furnish to the Company such
            information regarding itself, the Registrable Securities held by
            it, and the intended method of disposition of the Registrable
            Securities held by it, as shall be reasonably required to effect
            the registration of such Registrable Securities and shall execute
            such documents in connection with such registration as the
            Company may reasonably request.  At least five (5) days prior to
            the first anticipated filing date of the Registration Statement,
            the Company shall notify each Investor of the information the
            Company requires from each such Investor (the "Requested
            Information") if such Investor elects to have any of such
            Investor's Registrable Securities included in the Registration
            Statement.

      (b)   Each Investor by such Investor's acceptance of the Registrable
            Securities agrees to cooperate with the Company as reasonably
            requested by the Company in connection with the preparation and
            filing of the Registration Statement hereunder, unless such Investor
            has notified the Company in writing of such Investor's election to
            exclude all of such Investor's Registrable Securities from the
            Registration Statement; and

      (c)   Each Investor agrees that, upon receipt of any notice from the
            Company of the happening of any event of the kind described in
            Section 3(e) or 3(f), above, such Investor will immediately
            discontinue disposition of Registrable Securities pursuant to the
            Registration Statement covering such Registrable Securities until
            such Investor's receipt of the copies of the supplemented or
            amended prospectus contemplated by Section 3(d) or 3(e) and, if
            so directed by the Company, such Investor shall deliver to the
            Company (at the expense of the Company) or destroy (and deliver
            to the Company a certificate of destruction) all copies in such
            Investor's possession, of the prospectus covering such
            Registrable Securities current at the time of receipt of such
            notice.



                                      -6-
<PAGE>

5.    EXPENSES OF REGISTRATION. All expenses, other than underwriting discounts
      and commissions, incurred in connection with registrations, filings or
      qualifications pursuant to Section 3, but including, without limitation,
      all registration, listing, and qualifications fees, printers and
      accounting fees, the fees and disbursements of counsel for the Company,
      shall be borne by the Company.

6.    INDEMNIFICATION.  In the event any Registrable Securities are included
      in a Registration Statement under this Agreement:

      (a)   To the extent permitted by law, the Company will indemnify and
            hold harmless each Buyer, the directors, if any, of such Buyer,
            the officers, if any, of such Buyer, each person, if any, who
            controls any Buyer within the meaning of the Securities Act or
            the Exchange Act (each, an "Indemnified Person" or "Indemnified
            Party"), against any losses, claims, damages, liabilities or
            expenses (joint or several) (including reasonable attorneys fees)
            incurred (collectively, "Claims") to which any of them may become
            subject under the Securities Act, the Exchange Act or otherwise,
            insofar as such Claims (or actions or proceedings, whether
            commenced or threatened, in respect thereof) arise out of or are
            based upon any of the following statements, omissions or
            violations in the Registration Statement, or any post-effective
            amendment thereof, or any prospectus included therein: (i) any
            untrue statement or alleged untrue statement of a material fact
            contained in the Registration Statement or any post-effective
            amendment thereof or the omission or alleged omission to state
            therein a material fact required to be stated therein or
            necessary to make the statements therein not misleading, (ii) any
            untrue statement or alleged untrue statement of a material fact
            contained in the final prospectus (as amended or supplemented, if
            the Company files any amendment thereof or supplement thereto
            with the SEC) or the omission or alleged omission to state
            therein any material fact necessary to make the statements made
            therein, in light of the circumstances under which the statements
            therein were made, not misleading or (iii) any violation or
            alleged violation by the Company of the Securities Act, the
            Exchange Act, any state securities law or any rule or regulation
            under the Securities Act, the Exchange Act or any state
            securities law (the matters in the foregoing clauses (i) through
            (iii) being, collectively, "Violations").  Subject to clause (b)
            of this Section 6, the Company shall reimburse the Buyers,
            promptly as such expenses are incurred and are due and payable,
            for any legal fees or other reasonable expenses incurred by them
            in connection with investigating or defending any such Claim.
            Notwithstanding anything to the contrary contained herein, the
            indemnification agreement contained in this Section 6(a) shall
            not (I) apply to a Claim arising out of or based upon a Violation
            which occurs in reliance upon and in conformity with information
            furnished in writing to the Company by or on behalf of any
            Indemnified Person expressly for use in connection with the
            preparation of the Registration Statement or any such amendment
            thereof or supplement thereto, (II) be available to the extent
            such Claim is based on a failure of the Buyer to deliver or cause
            to be delivered the prospectus made available by



                                      -7-
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            the Company; or (III) apply to amounts paid in settlement of any
            Claim if such settlement is effected without the prior written
            consent of the Company, which consent shall not be unreasonably
            withheld. Each Buyer will, severally and not jointly, indemnify the
            Company and its officers, directors and agents against any claims
            arising out of or based upon a Violation which occurs in reliance
            upon and in conformity with information furnished in writing to the
            Company, by or on behalf of such Buyer, expressly for use in
            connection with the preparation of the Registration Statement,
            subject to such limitations and conditions as are applicable to the
            Indemnification provided by the Company to this Section 6. Such
            indemnity shall remain in full force and effect regardless of any
            investigation made by or on behalf of the Indemnified Person and
            shall survive the transfer of the Registrable Securities by the
            Investors pursuant to Section 9. In no event shall the liability of
            any Buyer hereunder be greater in amount than the dollar amount of
            the net proceeds received by such Buyer upon the sale of the
            Registrable Securities giving rise to such indemnification
            obligation.

      (b)   Promptly after receipt by an Indemnified Person or Indemnified
            Party under this Section 6 of notice of the commencement of any
            action (including any governmental action), such Indemnified
            Person or Indemnified Party shall, if a Claim in respect thereof
            is to be made against any indemnifying party under this Section
            6, deliver to the indemnifying party a written notice of the
            commencement thereof and the indemnifying party shall have the
            right to participate in, and, to the extent the indemnifying
            party so desires, jointly with any other indemnifying party
            similarly noticed, to assume control of the defense thereof with
            counsel mutually satisfactory to the indemnifying party and the
            Indemnified Person or the Indemnified Party, as the case may be.
            In case any such action is brought against any Indemnified Person
            or Indemnified Party, and it notifies the indemnifying party of
            the commencement thereof, the indemnifying party will be entitled
            to participate in, and, to the extent that it may wish, jointly
            with any other indemnifying party similarly notified, assume the
            defense thereof, subject to the provisions herein stated and
            after notice from the indemnifying party to such Indemnified
            Person or Indemnified Party of its election so to assume the
            defense thereof, the indemnifying party will not be liable to
            such Indemnified Person or Indemnified Party under this Section 6
            for any legal or other reasonable out-of-pocket expenses
            subsequently incurred by such Indemnified Person or Indemnified
            Party in connection with the defense thereof other than
            reasonable costs of investigation, unless the indemnifying party
            shall not pursue the action of its final conclusion.  The
            Indemnified Person or Indemnified Party shall have the right to
            employ separate counsel in any such action and to participate in
            the defense thereof, but the fees and reasonable out-of-pocket
            expenses of such counsel shall not be at the expense of the
            indemnifying party if the indemnifying party has assumed the
            defense of the action with counsel reasonably satisfactory to the
            Indemnified Person or Indemnified Party. The failure to deliver
            written notice to the indemnifying party within a reasonable time
            of the commencement



                                      -8-
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            of any such action shall not relieve such indemnifying party of any
            liability to the Indemnified Person or Indemnified Party under this
            Section 6, except to the extent that the indemnifying party is
            prejudiced in its ability to defend such action. The indemnification
            required by this Section 6 shall be made by periodic payments of the
            amount thereof during the course of the investigation or defense, as
            such expense, loss, damage or liability is incurred and is due and
            payable.

7.    CONTRIBUTION.  To the extent any indemnification by an indemnifying
      party is prohibited or limited by law, the indemnifying party agrees to
      make the maximum contribution with respect to any amounts for which it
      would otherwise be liable under Section 6 to the fullest extent
      permitted by law; PROVIDED, HOWEVER, that (a) no contribution shall be
      made under circumstances where the maker would not have been liable for
      indemnification under the fault standards set forth in Section 6; (b)
      no seller of Registrable Securities guilty of fraudulent
      misrepresentation (within the meaning of Section 11(f) of the
      Securities Act) shall be entitled to contribution from any seller of
      Registrable Securities who was not guilty of such fraudulent
      misrepresentation; and (c) contribution by any seller of Registrable
      Securities shall be limited in amount to the net amount of proceeds
      received by such seller from the sale of such Registrable Securities.

8.    REPORTS UNDER EXCHANGE ACT. With a view to making available to the
      Investors the benefits of Rule 144 promulgated under the Securities Act or
      any other similar rule or regulation of the SEC that may at any time
      permit the Investors to sell securities of the Company to the public
      without registration ("Rule 144"), the Company agrees to:

      (a)   make and keep public information available, as those terms are
            understood and defined in Rule 144;

      (b)   file with the SEC in a timely manner all reports and other documents
            required of the Company under the Securities Act and the Exchange
            Act; and

      (c)   furnish to each Investor so long as such Investor owns
            Registrable Securities, promptly upon request, (i) a written
            statement by the Company that it has complied with the reporting
            requirements of Rule 144, the Securities Act and the Exchange
            Act, (ii) a copy of the most recent annual or quarterly report of
            the Company and such other reports and documents so filed by the
            Company and (iii) such other information as may be reasonably
            requested to permit the Investors to sell such securities
            pursuant to Rule 144 without registration.

9.    ASSIGNMENT OF THE REGISTRATION RIGHTS.  The rights to have the Company
      register Registrable Securities pursuant to this Agreement shall be
      automatically assigned by the Investors to any transferee of the
      Registrable Securities (or all or any portion of any Debenture of the
      Company which is convertible into such securities) only if:  (a) the
      Investor agrees in writing with the transferee or assignee to assign
      such rights, and a copy of such agreement is furnished to the Company
      within a reasonable time after such



                                      -9-
<PAGE>

      assignment, (b) the Company is, within a reasonable time after such
      transfer or assignment, furnished with written notice of (i) the name and
      address of such transferee or assignee and (ii) the securities with
      respect to which such registration rights are being transferred or
      assigned, (c) immediately following such transfer or assignment the
      further disposition of such securities by the transferee or assignee is
      restricted under the Securities Act and applicable state securities laws,
      and (d) at or before the time the Company received the written notice
      contemplated by clause (b) of this sentence the transferee or assignee
      agrees in writing with the Company to be bound by all of the provisions
      contained herein. In the event of any delay in filing or effectiveness of
      the Registration Statement as a result of such assignment, the Company
      shall not be liable for any damages arising from such delay, or the
      payments set forth in Section 2(c) hereof.

10.   AMENDMENT OF REGISTRATION RIGHTS. Any provision of this Agreement may be
      amended and the observance thereof may be waived (either generally or in a
      particular instance and either retroactively or prospectively), only with
      the written consent of the Company and Investors who hold an eighty (80%)
      percent interest of the Registrable Securities. Any amendment or waiver
      effected in accordance with this Section 10 shall be binding upon each
      Investor and the Company.

11.   MISCELLANEOUS.

      (a)   Notices required or permitted to be given hereunder shall be in
            writing and shall be deemed to be sufficiently given when
            personally delivered (by hand, by courier, by telephone line
            facsimile transmission, receipt confirmed, or other means) or
            sent by certified mail, return receipt requested, properly
            addressed and with proper postage pre-paid (i) if to the Company,
            Stratus Services Group, Inc., 500 Craig Road, Manalapan, New
            Jersey 07726, Attention:  J. Todd Raymond, Esq., Telecopier No.:
            (732) 294-1133; with a copy to Giordano, Halleran & Ciesla, P.C.,
            125 Half Mile Road, P.O. Box 190, Middletown, New Jersey 07748,
            Attention: Philip D. Forlenza, Esq., Telecopier No.: (732)
            224-6599; (ii) if to the Buyer, at the address set forth under
            its name in the Securities Purchase Agreement and (iii) if to any
            other Investor, at such address as such Investor shall have
            provided in writing to the Company, or at such other address as
            each such party furnishes by notice given in accordance with this
            Section 11(b), and shall be effective, when personally delivered,
            upon receipt and, when so sent by certified mail, three calendar
            days after deposit with the United states Postal Service.

      (b)   Failure of any party to exercise any right or remedy under this
            Agreement or otherwise, or delay by a party in exercising such right
            or remedy, shall not operate as a waiver thereof.

      (c)   All questions concerning the construction, validity, enforcement
            and interpretation of this Agreement shall be governed by and
            construed and enforced in accordance with the internal laws of
            the State of New York, without regard to the principles



                                      -10-
<PAGE>

            of conflicts of law thereof. Each party hereby irrevocably submits
            to the exclusive jurisdiction of the state and federal courts
            sitting in the City of New York, borough of Manhattan, for the
            adjudication of any dispute hereunder or in connection herewith or
            with any transaction contemplated hereby or discussed herein, and
            hereby irrevocably waives, and agrees not to assert in any suit,
            action or proceeding, any claim that it is not personally subject to
            the jurisdiction of any such court, that such suit, action or
            proceeding is improper. Each party hereby irrevocably waives
            personal service of process and consents to process being served in
            any such suit, action or proceeding by mailing a copy thereof to
            such party at the address in effect for notices to it under this
            Agreement and agrees that such service shall constitute good and
            sufficient service of process and notice thereof. Nothing contained
            herein shall be deemed to limit in any way any right to serve
            process in any manner permitted by law. Each party irrevocably
            waives, to the fullest extent permitted by applicable law, any and
            all right to trial by jury in any legal proceeding arising out of or
            relating to this Agreement or the transactions contemplated hereby.
            If either party shall commence an action or proceeding to enforce
            any provisions of this Agreement, then the prevailing party in such
            action or proceeding shall be reimbursed by the other party for its'
            attorneys fees and other costs and expenses incurred with the
            investigation, preparation and prosecution of such action or
            proceeding.

      (d)   This Agreement constitutes the entire agreement among the parties
            hereto with respect to the subject matter hereof. There are no
            restrictions, promises, warranties or undertakings, other than those
            set forth or referred to herein. This Agreement supersedes all prior
            agreements and understandings among the parties hereto with respect
            to the subject matter hereof.

      (e)   Subject to the requirements of Section 9 hereof, this Agreement
            shall inure to the benefit of and be binding upon the successors and
            assigns of each of the parties hereto.

      (f)   All pronouns and any variations thereof refer to the masculine,
            feminine or neuter, singular or plural, as the context may require.

      (g)   The headings in this Agreement are for convenience of reference only
            and shall not limit or otherwise affect the meaning thereof.

      (h)   This Agreement may be executed in two or more counterparts, each
            of which shall be deemed an original but all of which shall
            constitute one and the same agreement.  In the event that any
            signature is delivered by facsimile transmission, such signature
            shall create a valid and binding obligation of the party
            executing (or on whose behalf such signature is executed) the
            same with the same force and effect as if such facsimile
            signature page were an original thereof.

      (i)   Neither party shall be liable for consequential damages.



                                      -11-
<PAGE>

12.   EFFECTIVENESS.  This Agreement shall not become effective with respect
      to a particular Buyer until such time as the closing of a sale of
      Debentures to such Buyer under the Securities Purchase Agreement occurs.



                                      -12-
<PAGE>

      IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of the day
and year first above written.

                              STRATUS SERVICES GROUP, INC.

                              By:
                                  -----------------------------------------
                                  Joseph J. Raymond, Chairman & CEO



                                      -13-
<PAGE>




                                                                       Exhibit A

                              BUYER SIGNATURE PAGE

      This Signature Page constitutes (i) a signature page to, and part of, that
certain Registration Rights Agreement, dated and effective as of December 1,
2000 (the "Registration Rights Agreement"), by and among Stratus Services Group,
Inc. ("Stratus") and the parties who are or become party thereto by executing a
signature page substantially in the form of Exhibit A thereto and (ii) the
agreement of the undersigned to become a party to, and be bound by the terms and
provisions of, the Registration Rights Agreement.

Buyer/Investor:                     Name:
                                         ----------------------------------
                                                (Please Print)

                                    By:
                                       ------------------------------------
                                          (Sign above)

                                    Name:
                                         ----------------------------------
                                          (For Investors that are entities)

                                    Title:
                                          ---------------------------------
                                          (For Investors that are entities)




                                      -14-
<PAGE>






                                                                        Annex A


                              PLAN OF DISTRIBUTION

      The Selling Stockholders and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of Common Stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The Selling Stockholders may use any one or more of the
following methods when selling shares:

o     ordinary brokerage transactions and transactions in which the
      broker-dealer solicits purchasers;

o     block trades in which the broker-dealer will attempt to sell the shares as
      agent but may position and resell a portion of the block as principal to
      facilitate the transaction;

o     purchases by a broker-dealer as principal and resale by the broker-dealer
      for its account;

o     an exchange distribution in accordance with the rules of the applicable
      exchange;

o     privately negotiated transactions;

o     short sales;

o     broker-dealers may agree with the Selling Stockholders to sell a
      specified number of such shares at a stipulated price per share;

o     a combination of any such methods of sale; and

o     any other method permitted pursuant to applicable law.

      The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.

      The Selling Stockholders may also engage in short sales against the box,
puts and calls and other transactions in securities of the Company or
derivatives of Company securities and may sell or deliver shares in connection
with these trades. The Selling Stockholders may pledge their shares to their
brokers under the margin provisions of customer agreements. If a Selling
Stockholder defaults on a margin loan, the broker may, from time to time, offer
and sell the



                                      -15-
<PAGE>

pledged shares. The Selling Stockholders have advised the Company that they have
not entered into any agreements, understandings or arrangements with any
underwriters or broker-dealers regarding the sale of their shares other than
ordinary course brokerage arrangements, nor is there an underwriter or
coordinating broker acting in connection with the proposed sale of shares by the
Selling Stockholders.

      Broker-dealers engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The Selling Stockholders do not expect these commissions and
discounts to exceed what is customary in the types of transactions involved.

      The Investor and any broker-dealers or agents that are involved in selling
the shares are considered "underwriters" by the Securities and Exchange
Commission within the meaning of the Securities Act in connection with sales
under this Registration Statement. Accordingly, any commissions received by such
broker-dealers or agents and any profit on the resale of the shares purchased by
them will be deemed underwriting commissions or discounts under the Securities
Act.

      The Company is required to pay all fees and expenses incident to the
registration of the shares, including fees and disbursements of counsel to the
Selling Stockholders. The Company has agreed to indemnify the Selling
Stockholders against certain losses, claims, damages and liabilities, including
liabilities under the Securities Act.


                                      -16-