Stratus Services Group, Inc. Announces Entry into Management Agreement with ALS, LLC

Shrewsbury, New Jersey, UNITED STATES

MANALAPAN, N.J., Feb. 8, 2005 (PRIMEZONE) -- Stratus Services Group, Inc., the SMARTSolutions(TM) Company (OTCBB:SSVG), announced today that it has entered into a Management Agreement ("Management Agreement") with ALS, LLC ("ALS"), with regard to certain outsourcing and management services it will perform for the Company.

Previously the Company entered into various agreements with ALS, a company in which Joseph J. Raymond, Jr., a son of the CEO, holds a 50% interest, pursuant to which ALS provided payroll outsourcing services for all of the Company's in-house staff and customer staffing requirements in California, Delaware, Maryland, Texas and Florida. The Company paid agreed upon rates, plus burden (payroll taxes and worker's compensation insurance) plus a fee based on a percentage of pay rates.

On February 2, 2005, the Company entered into this new Management Agreement with an Effective Date of February 21, 2005, which supersedes and replaces all of its existing Employer Service Agreements dated from November, 2003, through May, 2004, and its Outsourcing Agreement dated August 13, 2004. The Management Agreement (a copy of which is included with the Company's Form 8-K, filed February 8, 2005) is for a term of three (3) years. Pursuant to the terms of the Management Agreement, the Company will now outsource all of its in-house staff and customer staffing requirements, in all states in which it is currently doing business, except for its employees at its corporate headquarters in Manalapan, New Jersey, through ALS. The Company will continue to pay a fee to ALS for these outsourcing services, based upon agreed upon rates, plus burden, plus a fee based on a percentage of pay rates.

Joseph J. Raymond, Sr., the Company's President, stated, "I am very satisfied with the Management Agreement we have been able to work out with ALS. In the past we have been able to work with a similar agreement, which has been very successful. This agreement basically extends the previous agreement, with certain costs now going to be the burden of ALS with certain fees being paid, based upon profitability. This now allows Stratus to concentrate on sales and acquisitions. "

Stratus is a national provider of business productivity consulting and staffing services through a network of twenty-nine offices in seven states. Through its SMARTSolutions(TM) technology, Stratus provides a structured program to monitor and reduce the cost of a customer's labor resources. Through its Stratus Technology Services, LLC joint venture, the Company provides a broad range of information technology staffing and project consulting.

This news release includes forward-looking statements within the meaning of the federal securities laws that are subject to risks and uncertainties. Factors that could cause the Company's actual results and financial condition to differ from the Company's expectations include, but are not limited to, a change in economic conditions that adversely affects the level of demand for the Company's services, competitive market and pricing pressures, the availability of qualified temporary workers, the ability of the Company to manage growth through improved information systems and the training and retention of new staff, and government regulations.


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