ELTRAX SYSTEMS INC, S-4/A, 2000-08-29

ELTRAX SYSTEMS INC
S-4/A, 2000-08-29
COMPUTER INTEGRATED SYSTEMS DESIGN

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 29, 2000

REGISTRATION NO. 333-43224

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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AMENDMENT NO. 1

FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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ELTRAX SYSTEMS, INC.
(Exact name of registrant as specified in its charter)

<TABLE>
<S> <C> <C>
MINNESOTA 7373 41-1484525
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
</TABLE>

<TABLE>
<S> <C>
WILLIAM P. O'REILLY
CHAIRMAN OF THE BOARD, PRESIDENT
AND CHIEF EXECUTIVE OFFICER
400 GALLERIA PARKWAY 400 GALLERIA PARKWAY, SUITE 300
SUITE 300 ATLANTA, GEORGIA 30339
ATLANTA, GEORGIA 30339 (770) 612-3500
(Address, Including Zip Code, and Telephone Number, (Name, Address, Including Zip Code, and Telephone
Including Number,
Area Code, of Registrant's Principal Executive Including Area Code, of Agent for Service)
Offices)
</TABLE>

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Copies to:

<TABLE>
<S> <C> <C>
JOEL M. ALAM, ESQ. STEVEN A. ODOM STEVEN E. FOX, ESQ.
SARA M. KRUSE, ESQ. Chairman of the Board and ROBERT C. HUSSLE, ESQ.
MATTHEW MURPHY, ESQ. Chief Executive Officer Rogers & Hardin LLP
Jaffe, Raitt, Heuer & Weiss Cereus Technology Partners, Inc. 2700 International Tower,
Professional Corporation 1000 Abernathy Road, Suite 1000 Peachtree Center
One Woodward Avenue Atlanta, Georgia 30328 229 Peachtree Street NE
Suite No. 2400 (770) 668-0900 Atlanta, Georgia 30303-1601
Detroit, Michigan 48226 (404) 522-4700
(313) 961-8380
</TABLE>

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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this registration statement becomes effective.

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If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]

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If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

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If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY
DETERMINE.

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<PAGE> 2

[ELTRAX LOGO]

[CEREUS LOGO]

MERGER PROPOSED -- YOUR VOTE IS VERY IMPORTANT

The boards of directors of Eltrax Systems, Inc. and Cereus Technology
Partners, Inc. have agreed to merge. We are very excited by the opportunities we
envision for the combined company. We believe the combined company will be able
to create substantially more stockholder value than could be achieved by either
company individually. Each of our boards of directors unanimously approved the
merger and believes the merger is in the best interests of its stockholders.
Accordingly, your board of directors unanimously recommends that you vote for
the merger.

In the merger, Cereus stockholders will receive 1.75 shares of Eltrax common
stock for each share of Cereus common stock. The exchange ratio will be adjusted
downward to 1.667 shares of Eltrax common stock for each share of Cereus common
stock if Cereus does not before September 1, 2000 or September 18, 2000, under
certain circumstances, amend the existing bridge facility between Eltrax and
Cereus to provide Eltrax with an additional $5.0 million in borrowing
availability under the bridge facility and, in this event, may be adjusted
further downward if Eltrax completes a sale of all or any part of its
hospitality services group for $8 million or more in cash before the merger.
Eltrax and Cereus will post the current exchange ratio on their Web sites at
www.eltrax.com and www.cereus.net. This information will also be available by
calling D.F. King & Co. at 1-800-549-6746.

Eltrax stockholders will continue to own their existing Eltrax shares.
Approximately 17.1 million shares of Eltrax common stock will be issued to
Cereus stockholders in the merger, based on the number of shares of Cereus
common stock outstanding on August 28, 2000. Fractional shares will be paid in
cash. If the merger occurs (assuming an exchange ratio of 1.75 shares of Eltrax
common stock for each share of Cereus common stock), Cereus's stockholders will
own approximately 39.7% of the combined company (or approximately 50.1% if all
outstanding options and warrants to purchase Cereus common stock and Eltrax
common stock are exercised and if all debt convertible into shares of Eltrax
common stock is converted) and Eltrax's stockholders will own the remainder.

Eltrax common stock trades on the Nasdaq National Market under the symbol
"ELTX." Cereus common stock trades on the Nasdaq National Market under the
symbol "CEUS." Prior to August 28, 2000, Cereus common stock was traded on the
OTC Bulletin Board.

We cannot complete the merger unless the stockholders of both of our
companies approve it and certain conditions are satisfied. In addition, for the
merger to be completed, Eltrax stockholders must approve an amendment to
Eltrax's articles of incorporation to increase the number of authorized shares
of common stock. Each of us will hold a meeting of our stockholders to vote on
the merger, as well as other matters. YOUR VOTE IS VERY IMPORTANT. For the
merger to occur, Cereus stockholders owning a majority of Cereus common stock
outstanding and Eltrax stockholders owning a majority of Eltrax common stock
present at the Eltrax annual meeting must vote for it. Whether or not you plan
to attend your stockholder meeting, please take the time to vote by completing
and mailing the enclosed proxy card. If you sign, date and mail your proxy card
without indicating how you want to vote, your proxy will be counted as a vote in
favor of the merger. CEREUS STOCKHOLDERS WHO DO NOT RETURN THEIR PROXY CARDS OR
DO NOT INSTRUCT THEIR BROKERS HOW TO VOTE SHARES HELD BY THEM IN "STREET NAME"
WILL BE COUNTED AS A VOTE AGAINST THE MERGER.

The annual meeting of Eltrax stockholders will be held Friday, September 29,
2000 at 10:00 a.m., local time.

ELTRAX'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT ELTRAX STOCKHOLDERS
VOTE FOR THE PROPOSALS AND NOMINEES.

/s/ William P. O'Reilly
William P. O'Reilly
Chairman of the Board, President
and Chief Executive Officer
Eltrax Systems, Inc.

The annual meeting of Cereus stockholders will be held Friday, September 29,
2000 at 11:00 a.m., local time.

CEREUS'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT CEREUS'S
STOCKHOLDERS VOTE FOR THE MERGER AND NOMINEES.

/s/ Steven A. Odom
Steven A. Odom
Chairman of the Board and Chief Executive Officer
Cereus Technology Partners, Inc.

SEE "RISK FACTORS" ON PAGE 15 FOR A DISCUSSION OF CERTAIN INFORMATION
RELEVANT TO THE DECISION TO APPROVE THE MERGER.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER GOVERNMENTAL
AGENCY HAS APPROVED OF THE ELTRAX COMMON STOCK TO BE ISSUED UNDER THIS DOCUMENT
IN THE MERGER OR DETERMINED IF THIS JOINT PROXY STATEMENT/PROSPECTUS IS ACCURATE
OR ADEQUATE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

This joint proxy statement/prospectus is dated August 30, 2000 and is first
being mailed to stockholders of Eltrax and Cereus on or about August 31, 2000.

<PAGE> 3

THE MOST IMPORTANT THING FOR YOU TO DO IS VOTE

HOW TO VOTE

Stockholders of record

Registered holders of Eltrax common stock can vote their shares via (1) a
toll-free telephone call from the U.S. and Canada or (2) the Internet or (3) by
mailing their signed proxy card. The telephone and Internet voting procedures
available to Eltrax holders of record are designed to authenticate stockholders'
identities, to allow stockholders to vote their shares and to confirm that their
instructions have been properly recorded. Eltrax has been advised by counsel
that the procedures which have been put in place are consistent with the
requirements of applicable law. Specific instructions to be followed by any
registered Eltrax stockholder interested in voting via telephone or the Internet
are set forth on the enclosed proxy card. Registered holders of Cereus common
stock can vote their shares by mailing their signed proxy card.

Other stockholders

If your shares are held in the name of a bank, broker or other holder of
record, follow the voting instructions you receive from the holder of record.
Telephone and Internet voting also will be offered to Eltrax stockholders owning
stock through certain banks and brokers.

PLEASE VOTE YOUR SHARES. IF YOU ARE AN ELTRAX STOCKHOLDER AND YOU VOTE BY

TELEPHONE OR THE INTERNET, YOU DO NOT NEED TO RETURN YOUR PROXY CARD.

ANNUAL MEETINGS

The Eltrax annual meeting is open only to Eltrax stockholders as of the
Eltrax record date. The Cereus annual meeting is open only to Cereus
stockholders as of the Cereus record date.

STOCKHOLDER QUESTIONS

Cereus and Eltrax stockholders should call D.F. King & Co., Inc. at
1-800-549-6746.
<PAGE> 4

ELTRAX SYSTEMS, INC.
400 GALLERIA PARKWAY
SUITE 300
ATLANTA, GEORGIA 30339

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD SEPTEMBER 29, 2000

The annual meeting of stockholders of Eltrax Systems, Inc., a Minnesota
corporation, will be held at 10:00 a.m., local time, on Friday, September 29,
2000, at Renaissance Waverly Hotel, 2450 Galleria Parkway, Atlanta, Georgia
30339, for the following purposes:

1. To consider and vote upon a proposal to approve the Second Amended
and Restated Agreement and Plan of Merger, dated July 27, 2000, among
Eltrax, Solemn Acquisition Corporation and Cereus Technology Partners, Inc.
and the transactions it contemplates, including:

- the issuance of shares of Eltrax common stock to Cereus stockholders
in the merger;

- the assumption of Cereus stock options and warrants and the conversion
of those stock options and warrants into options and warrants to
purchase shares of Eltrax common stock; and

- the reconfiguration of Eltrax's board of directors.

2. To approve an amendment to Eltrax's articles of incorporation to
increase the authorized common stock to 100,000,000 shares, par value $.01
per share.

3. To approve an amendment to Eltrax's articles of incorporation to
change Eltrax's name to Verso Technologies, Inc.

4. To elect five nominees to the Eltrax board of directors to serve
until the earlier of the expiration of their terms or the consummation of
the merger.

5. To adopt the 1999 Eltrax Employee Stock Purchase Plan.

6. To transact such other business as may properly come before the
Eltrax annual meeting or any adjournments or postponements thereof.

Eltrax's board of directors is not aware of any other business to come
before the annual meeting. If approved, the amendments to the articles of
incorporation will be implemented only if the merger is completed. The merger
will not be completed unless the stockholders approve the proposal to increase
the authorized number of shares of common stock.

Only holders of record of shares of Eltrax common stock at the close of
business on August 21, 2000 are entitled to notice of the annual meeting and to
vote at the annual meeting or at any and all adjournments or postponements
thereof.

If you have any questions, please call D.F. King & Co., Inc., which is
assisting us with the meeting, at 1-800-549-6746.

BY ORDER OF THE BOARD OF DIRECTORS

/s/ William P. O'Reilly
William P. O'Reilly
Chairman of the Board, President
and Chief Executive Officer

Atlanta, Georgia

August 30, 2000

WHETHER OR NOT YOU PLAN TO ATTEND THE ELTRAX ANNUAL MEETING, PLEASE
COMPLETE, SIGN AND DATE YOUR PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE. YOU MAY REVOKE YOUR PROXY IN THE MANNER DESCRIBED IN
THIS DOCUMENT AT ANY TIME BEFORE THE PROXY HAS BEEN VOTED AT THE ANNUAL MEETING.
<PAGE> 5

CEREUS TECHNOLOGY PARTNERS, INC.
1000 ABERNATHY ROAD, SUITE 1000
ATLANTA, GEORGIA 30328

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD SEPTEMBER 29, 2000

The annual meeting of stockholders of Cereus Technology Partners, Inc., a
Delaware corporation, will be held at 11:00 a.m., local time, on Friday,
September 29, 2000, at Renaissance Waverly Hotel, 2450 Galleria Parkway,
Atlanta, Georgia 30339, for the following purposes:

1. To consider and vote upon a proposal to approve the Second Amended
and Restated Agreement and Plan of Merger, dated July 27, 2000, among
Cereus, Eltrax Systems, Inc. and Solemn Acquisition Corporation pursuant to
which, among other things:

- Solemn will be merged with and into Cereus, resulting in Cereus
becoming a wholly-owned subsidiary of Eltrax;

- at the effective time of the merger, each outstanding share of Cereus
common stock, other than shares owned by Eltrax or Cereus, which will
be cancelled, will be converted into the right to receive 1.75 fully
paid and nonassessable shares of Eltrax common stock, or 1.667 shares
of Eltrax common stock if Cereus does not before September 1, 2000 (or
September 18, 2000 under certain circumstances) amend the existing
bridge facility between Eltrax and Cereus to provide Eltrax with an
additional $5 million in borrowing availability under the bridge
facility and, in this event, may be adjusted further downward if
Eltrax sells all or any part of its hospitality services group for $8
million or more in cash in the aggregate before the merger; and

- at the effective time of the merger, each outstanding option and
warrant to purchase Cereus common stock will be assumed by Eltrax and
converted into an option or warrant (as the case may be) to purchase
shares of Eltrax common stock as adjusted to account for the exchange
ratio.

2. To elect seven nominees to the Cereus board of directors to serve
until the earlier of the expiration of their term or the consummation of
the merger.

3. To transact such other business as may properly come before the
Cereus annual meeting or any adjournments or postponements thereof.

Cereus's board of directors is not aware of any other business to come
before the annual meeting.

Only holders of record of shares of Cereus common stock at the close of
business on August 28, 2000 are entitled to notice of the annual meeting and to
vote at the annual meeting or at any and all adjournments or postponements
thereof.

If you have any questions, please call D.F. King & Co., Inc., which is
assisting us with the meeting, at 1-800-549-6746.

BY ORDER OF THE BOARD OF DIRECTORS

/s/ Steven A. Odom
Steven A. Odom
Chairman of the Board and Chief
Executive Officer

Atlanta, Georgia

August 30, 2000

WHETHER OR NOT YOU PLAN TO ATTEND THE CEREUS ANNUAL MEETING, PLEASE
COMPLETE, SIGN AND DATE YOUR PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED
POSTAGE-PREPAID ENVELOPE. YOU MAY REVOKE YOUR PROXY IN THE MANNER DESCRIBED IN
THIS DOCUMENT AT ANY TIME BEFORE THE PROXY HAS BEEN VOTED AT THE ANNUAL MEETING.
<PAGE> 6

TABLE OF CONTENTS

<TABLE>
<S> <C>
Questions and Answers about the Merger
and Meetings......................... 1
Summary................................ 3
The Companies........................ 3
The Merger........................... 3
The Merger Agreement................. 5
The Stockholder Meetings............. 7
Recent Developments.................. 9
Selected Consolidated Historical
Financial and Operating Data of
Eltrax............................... 11
Selected Consolidated Historical
Financial and Operating Data of
Cereus............................... 12
Comparative Per Share Data............. 13
Historical and Pro Forma Per Share Data
of Eltrax and Cereus................. 14
Risk Factors........................... 15
Risks Related to Our Business after
the Merger........................ 15
Risks Related to the Merger.......... 19
Forward-Looking Statements............. 22
Comparative Market Prices and
Dividends............................ 23
The Merger............................. 24
Overview............................. 24
Background of the Merger............. 25
Reasons for the Merger............... 27
Factors Considered by the Boards of
Directors......................... 29
Recommendations of the Eltrax and
Cereus Boards of Directors........ 30
Opinion of Eltrax's Financial
Advisor........................... 31
Opinion of Cereus's Financial
Advisor........................... 37
Interests of Directors and Officers
in the Merger..................... 46
Appraisal Rights..................... 47
Regulatory Approvals................. 47
Accounting Treatment................. 48
Certain Federal Income Tax
Consequences of the Merger........ 48
Resales of Eltrax Common Stock by
Affiliates of Cereus.............. 49
The Merger Agreement................... 50
Merger Consideration................. 50
Treatment of Cereus Stock Options and
Warrants.......................... 50
Fractional Shares.................... 51
Exchange of Certificates............. 51
Management and Boards of Directors
after the Merger.................. 52
Representations and Warranties....... 54
What We Must Do to Complete the
Merger............................ 55
Waiver and Amendment................. 56
Termination of the Merger
Agreement......................... 56
Termination Fees..................... 57
Covenants Pending Closing............ 58
Additional Agreements................ 59
Expenses............................. 61
Arbitration.......................... 61
Unaudited Pro Forma Consolidated
Financial Information................ 62
Description of Eltrax Capital Stock.... 69
Comparison of Stockholder Rights....... 71
Eltrax Annual Meeting.................. 75
Cereus Annual Meeting.................. 78
Additional Proposals for the Eltrax
Annual Meeting....................... 80
Election of Directors................ 80
Executive Officers................ 81
Director and Executive
Compensation.................... 82
Summary Compensation Table...... 83
Aggregate Option Exercises and
Year-End Option Values....... 84
Option Grant Table.............. 84
Security Ownership of Certain
Beneficial Owners and
Management...................... 87
Certain Relationships and Related
Transactions.................... 88
Stockholder Return Performance
Presentation.................... 89
Increase in Authorized Common
Stock............................. 90
Name Change.......................... 92
Employee Stock Purchase Plan......... 93
</TABLE>

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<TABLE>
<S> <C>
Additional Proposals for the Cereus Annual
Meeting....................................... 95
Election of Directors......................... 95
Executive Officers......................... 96
Director and Executive Compensation........ 98
Summary Compensation Table............... 99
Aggregate Option Exercises and Year-End
Option Values......................... 99
Option Grant Table....................... 100
Security Ownership of Certain Beneficial
Owners and
Management............................... 101
Certain Relationships and Related
Transactions............................. 102
Additional Information about Eltrax............. 104
Additional Information about Cereus............. 106
Cereus's Management's Discussion and Analysis of
Financial Condition and Results of
Operations.................................... 110
Where You Can Find More Information............. 114
Experts......................................... 114
Legal Opinions.................................. 115
Index to Consolidated Financial
Statements.................................... F-1
</TABLE>

<TABLE>
<S> <C> <C>
APPENDICES
Appendix A Second Amended and Restated A-1
Agreement and Plan of
Merger...................
Appendix B Opinion of Morgan Keegan & B-1
Company, Inc. ...........
Appendix C Opinion of The Robinson-
C-1
Humphrey Company, LLC......
Appendix D Eltrax 1999 Employee Stock D-1
Purchase Plan............
</TABLE>

ii
<PAGE> 8

QUESTIONS AND ANSWERS ABOUT THE MERGER AND MEETINGS

Q. WHY ARE THE TWO COMPANIES PROPOSING TO MERGE?

A. Our companies are proposing to merge because we believe that combining will
create a stronger company that will provide significant benefits to both
Cereus stockholders and Eltrax stockholders. We believe the combined company
will be able to create substantially more stockholder value than could be
achieved by either company individually.

Q. WHAT AM I BEING ASKED TO VOTE ON?

A. You are being asked to approve the proposed merger of Cereus and Eltrax. If
you are an Eltrax stockholder, your vote for the merger also authorizes the
issuance of Eltrax common stock to Cereus stockholders, the assumption of
Cereus stock options and warrants and the conversion of those options and
warrants into options and warrants to purchase shares of Eltrax common stock,
and the reconfiguration of the Eltrax board.

If you are an Eltrax stockholder, you are also being asked to approve four
other proposals:

- An amendment to Eltrax's articles of incorporation to increase the
authorized shares of common stock to 100,000,000.

- An amendment to Eltrax's articles of incorporation to change Eltrax's name.

- The election of five nominees to the Eltrax board of directors to serve
until the earlier of the expiration of their terms or the consummation of
the merger.

- The adoption of the Eltrax 1999 Employee Stock Purchase Plan.

If you are a Cereus stockholder, you are also being asked to elect seven
nominees to the Cereus board of directors to serve until the earlier of the
expiration of their terms or the consummation of the merger.

Q. IS THE AMENDMENT TO THE ELTRAX ARTICLES OF INCORPORATION TO INCREASE THE
AUTHORIZED CAPITAL STOCK NECESSARY TO COMPLETE THE MERGER?

A. Yes. Eltrax does not have enough shares of common stock to complete the
merger. Therefore, if you vote for the merger proposal, you should vote for
the proposal to amend the Eltrax articles of incorporation to increase the
number of authorized shares of common stock.

Q. WHAT WILL I RECEIVE IN THE MERGER?

A. Cereus stockholders will receive 1.75 shares of Eltrax common stock for each
share of Cereus common stock they own. The exchange ratio will be adjusted to
1.667 shares of Eltrax common stock for each share of Cereus common stock if
Cereus does not amend the existing bridge facility between Eltrax and Cereus
before September 1, 2000 (or September 18, 2000, under certain circumstances)
to provide Eltrax with an additional $5.0 million in borrowing availability
under the bridge facility. In this event, the exchange ratio may be adjusted
downward further if Eltrax sells all or any part of its hospitality services
group for $8.0 million or more in cash in the aggregate before the merger.
Eltrax stockholders will not change their ownership of Eltrax common stock in
the merger. After the merger (assuming an exchange ratio of 1.75 shares of
Eltrax common stock for each share of Cereus common stock), Cereus
stockholders will own approximately 39.7% of the outstanding common stock of
the combined company (or approximately 50.1% if all outstanding options and
warrants to purchase Cereus common stock and Eltrax common stock are
exercised and if all debt convertible into shares of Eltrax common stock is
converted), and Eltrax stockholders will own the remainder.

Q. HOW WILL I KNOW IF THE EXCHANGE RATIO IS ADJUSTED?

A. Eltrax and Cereus will post the current exchange ratio on their Web sites at
www.eltrax.com and www.cereus.net. This information will also be available
by calling D.F. King & Co. at 1-800-549-6746.

1
<PAGE> 9

Q. WILL I HAVE APPRAISAL RIGHTS IN CONNECTION WITH THE MERGER?

A. Neither Cereus stockholders nor Eltrax stockholders will have dissenters'
rights of appraisal in connection with the merger.

Q. WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER?

A. We have structured the merger so that Cereus and its stockholders will not
recognize any gain or loss for federal income tax purposes in the merger,
except in the case of cash to be received by Cereus stockholders in lieu of
Eltrax fractional shares. As part of closing the merger, Cereus will receive
a legal opinion confirming these tax consequences.

Q. WHAT SHOULD I DO NOW?

A. You should read this document and complete, sign and date the proxy card and
mail it to us in the enclosed return envelope as soon as possible. If you
sign and send the proxy card and do not indicate how you want to vote, we
will count your proxy card as a vote for the merger and the other Eltrax
proposals or Cereus proposal, as the case may be. Each of the boards of
directors of Eltrax and Cereus unanimously recommends that its stockholders
vote FOR the merger. The board of directors of Eltrax also unanimously
recommends voting for the other Eltrax proposals and Eltrax nominees. The
board of directors of Cereus also unanimously recommends voting FOR the
Cereus nominees.

Q. IF MY SHARES ARE HELD IN "STREET NAME" BY A BROKER, WILL THE BROKER VOTE THE
SHARES FOR ME?

A. Your broker cannot vote your shares on the merger proposal without your
instructions. If you are a Cereus stockholder, your failure to instruct your
broker on the merger proposal will be equivalent to voting against the
merger. If you are an Eltrax stockholder, your failure to instruct your
broker on the merger proposal will not be counted as a vote against the
merger.

Q. SHOULD I SEND IN MY STOCK CERTIFICATES NOW?

A. No. Cereus stockholders will be sent written instructions for exchanging
stock certificates at a later date. Eltrax stockholders will keep their
current stock certificates.

Q. CAN I CHANGE MY VOTE AFTER SUBMITTING MY PROXY CARD?

A. Yes. You can change your vote at any time before your meeting by submitting a
revocation notice or a later-dated signed proxy card or by attending the
meeting and voting in person.

Q. WHEN DO YOU EXPECT THE MERGER TO BE COMPLETED?

A. We hope to complete the merger in the third quarter of 2000.

Q. WHAT SHOULD I DO IF I HAVE QUESTIONS?

A. Cereus stockholders and Eltrax stockholders may call D.F. King & Co., Inc. at
1-800-549-6746.

2
<PAGE> 10

SUMMARY

This summary highlights selected information from this document and may not
contain all the information that is important to you. To understand the merger
fully, and for more complete descriptions of the legal terms of the merger, you
should carefully read this entire document and the documents to which we refer
you. See "Where You Can Find More Information."

THE COMPANIES

ELTRAX SYSTEMS, INC.
400 Galleria Parkway, Suite 300
Atlanta, Georgia 30339

Eltrax, a Minnesota corporation, is a provider of outsourced information
technology ("IT") solutions. Eltrax operates through two separate business
units: the technology services group and the hospitality services group. The
technology services group provides technology solutions, customer care services
and acts as an application service provider ("ASP"). The hospitality services
group provides enterprise information solutions for the global hospitality
industry. Eltrax is exploring various alternatives to further its strategy of
expanding its penetration of the network, application and ASP markets. As part
of this process, Eltrax is pursuing the disposition of its hospitality services
group. As such, Eltrax has begun accounting for the hospitality services group
as a discontinued operation and its historical results of operations, which are
the result of Eltrax's old business strategy, may not give you an accurate
indication of how Eltrax will perform in the future.

CEREUS TECHNOLOGY PARTNERS, INC.
1000 Abernathy Road, Suite 1000
Atlanta, Georgia 30328

Cereus, a Delaware corporation, is an end-to-end solutions provider of
e-business and B2B technologies, including e-Business strategy, Web
design/development, application integration, network consulting and hosting.
Cereus delivers its solutions through the most effective delivery method
available -- whether at the customer's location, as an ASP, or through
outsourcing. Cereus helps its customers transform their businesses for the new
economy. In many cases, Cereus becomes the customer's IT department by providing
end-to-end solutions, including communications and data services.

THE MERGER

REASONS FOR THE MERGER (SEE PAGE 27)

The board of directors of Eltrax and the board of directors of Cereus
believe that the merger is fair to, and in the best interests of, the
stockholders of Eltrax and Cereus, respectively. We believe that the combined
company will be able to create greater stockholder value than could be achieved
by the companies individually.

Cereus's board of directors has identified the following potential benefits
of the merger, among others:

- the ability to quickly achieve the critical mass necessary to compete in
Cereus's industry sector;

- the ability to access Eltrax's state of the art, fully-developed
technology services group that provides comprehensive outsourced
technology solutions and customer care solutions;

- the greater financial flexibility and more favorable access to capital
enjoyed by larger companies;

- the ability to provide Cereus stockholders with enhanced liquidity;

- the ability to provide Cereus stockholders with shares of Eltrax common
stock in a tax-free exchange; and
3
<PAGE> 11

- an operational structure for the combined company in which the current
directors of Cereus will constitute a majority of the combined company's
board of directors and the Cereus management team will hold all of the
combined company's senior management-level positions.

Eltrax's board of directors has identified the following potential benefits
of the merger, among others:

- securing a talented team of senior management-level individuals with the
experience and drive necessary to grow the combined company in a manner
and in a time frame necessary to compete effectively in the combined
company's industry;

- deepening Eltrax's technology expertise by gaining access to Cereus's
highly-qualified group of Web developers and other technology
professionals;

- increasing Eltrax's access to capital;

- expediting Eltrax's goal of becoming a major force in the ASP
marketplace; and

- leveraging the combined company's strengths to access the capital needed
to grow effectively.

OUR RECOMMENDATIONS TO STOCKHOLDERS (SEE PAGE 30)

THE ELTRAX BOARD BELIEVES THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS
OF, ELTRAX'S STOCKHOLDERS AND UNANIMOUSLY RECOMMENDS THAT THEY VOTE FOR THE
ELTRAX MERGER PROPOSAL.

THE CEREUS BOARD BELIEVES THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS
OF, CEREUS'S STOCKHOLDERS AND UNANIMOUSLY RECOMMENDS THAT THEY VOTE FOR THE
MERGER AGREEMENT.

OPINIONS OF FINANCIAL ADVISORS (SEE PAGE 31)

Morgan Keegan & Company, Inc. has delivered its opinion to the Eltrax board
of directors that the exchange ratio is fair from a financial point of view to
Eltrax's common stockholders as of August 4, 2000. The Robinson-Humphrey
Company, LLC has delivered its oral opinion (which was subsequently confirmed in
writing) to the Cereus board of directors that the exchange ratio is fair from a
financial point of view to Cereus's common stockholders as of July 27, 2000. A
copy of Morgan Keegan's opinion is attached to this document as Appendix B, and
a copy of Robinson-Humphrey's opinion is attached to this document as Appendix
C. You should read the opinions completely to understand the assumptions made,
matters considered and limitations of the review made by Morgan Keegan and
Robinson-Humphrey in providing their opinions.

INTERESTS OF DIRECTORS AND OFFICERS IN THE MERGER (SEE PAGE 46)

When you consider the recommendations of our boards of directors that you
vote in favor of the relevant proposals, you should be aware that a number of
Cereus's officers and directors will be entitled to receive certain benefits if
the merger occurs that they will not be entitled to receive if the merger does
not occur.

APPRAISAL RIGHTS (SEE PAGE 47)

Neither Cereus stockholders nor Eltrax stockholders will have dissenters'
rights of appraisal in connection with the merger.

REGULATORY APPROVALS (SEE PAGE 47)

Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and its
associated rules, the merger may not be consummated until applications and
notices have been reviewed by the Antitrust Division of the Department of
Justice and the Federal Trade Commission. We have filed the necessary premerger
notification and report forms with the Antitrust Division and Federal Trade
Commission, and we have been granted early termination of the waiting period
under the Hart-Scott-Rodino Act.

4
<PAGE> 12

ACCOUNTING TREATMENT (SEE PAGE 48)

The merger will be accounted under the purchase method of accounting under
generally accepted accounting principles.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER (SEE PAGE 48)

A Cereus stockholder's receipt of Eltrax common stock in the merger
generally will be tax-free for United States federal income tax purposes, except
for tax resulting from the receipt of cash instead of any fractional share of
Eltrax common stock. The companies themselves, as well as Eltrax stockholders,
will not recognize gain or loss for United States federal income tax purposes as
a result of the merger.

THE MERGER AGREEMENT

MERGER CONSIDERATION (SEE PAGE 50)

As a result of the merger, Cereus stockholders will receive 1.75 shares of
Eltrax common stock for each share of Cereus common stock. The exchange ratio
will be adjusted downward to 1.667 shares of Eltrax common stock for each share
of Cereus common stock if Cereus does not amend the existing bridge facility
between Eltrax and Cereus before September 1, 2000, which date may be extended
to September 18, 2000 under certain conditions, to provide Eltrax with an
additional $5.0 million in borrowing availability under the bridge facility. If
the exchange ratio is adjusted to 1.667 shares of Eltrax common stock for each
share of Cereus common stock, then it will be adjusted downward further if
Eltrax sells all or any part of its hospitality services group for $8.0 million
or more in cash in the aggregate before the merger. Eltrax and Cereus will post
the current exchange ratio on their Web sites at www.eltrax.com and
www.cereus.net. This information will also be available by calling D.F. King &
Co. at 1-800-549-6746. See "The Merger Agreement -- Additional Agreements."
Eltrax will not issue fractional shares in the merger. Instead, Cereus
stockholders will receive the value of any fractional share in cash, based on
the closing price of Eltrax's common stock on the last trading day before the
merger. Following the merger, Cereus stockholders will need to exchange their
certificates of Cereus common stock for certificates of Eltrax common stock. We
will send Cereus stockholders the forms to do this.

Based on the closing price for Eltrax common stock on August 28, 2000
($4.75 per share), the value of 1.75 shares of Eltrax common stock would have
been $8.3125. The value of Eltrax common stock, however, will fluctuate.
Fluctuations will result in an increase or decrease in the value of the Eltrax
common stock to be received by Cereus stockholders.

If you are an Eltrax stockholder, you will not need to exchange your shares
of Eltrax common stock.

TREATMENT OF CEREUS STOCK OPTIONS AND WARRANTS (SEE PAGE 50)

The options to purchase Cereus common stock under Cereus's stock option
plan and warrants to purchase Cereus common stock will be assumed by Eltrax and
converted into options or warrants (as the case may be) to purchase Eltrax
common stock with appropriate adjustments to the number of shares subject to the
options and warrants and to the exercise price to reflect the exchange ratio.

MANAGEMENT AND BOARDS OF DIRECTORS AFTER THE MERGER (SEE PAGE 52)

Effective September 1, 2000, Steven A. Odom has been elected the Chief
Executive Officer of Eltrax, James M. Logsdon has been elected the President and
Chief Operating Officer of Eltrax and Juliet M. Reising has been elected the
Chief Financial Officer Executive Vice President, and Secretary of Eltrax. After
the merger, they will continue to serve in those offices and William P. O'Reilly
will continue to serve as Eltrax's Chairman of the Board.

5
<PAGE> 13

Eltrax Board of Directors

If the merger is approved, at the time of the merger the Eltrax board of
directors will be increased to nine and reconfigured as follows:

<TABLE>
<CAPTION>
BEFORE THE MERGER AFTER THE MERGER
----------------- ----------------
<S> <C>
William P. O'Reilly (Chairman) William P. O'Reilly (Chairman)
Stephen E. Raville Stephen E. Raville
Patrick J. Dirk Steven A. Odom*
James C. Barnard James M. Logsdon*
William G. Taylor Juliet M. Reising*
Amy Newmark*
Max E. Bobbitt*
Gary H. Heck*
Joseph R. Wright, Jr.*
</TABLE>

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

* Current Cereus director.

Cereus Board of Directors

The Cereus board of directors will consist of the persons elected at the
Cereus annual meeting until changed in accordance with Cereus's certificate of
incorporation and bylaws.

WHAT WE MUST DO TO COMPLETE THE MERGER (SEE PAGE 55)

A number of conditions must be met for the merger to be completed,
including:

- approval of the merger proposals by both the Cereus stockholders and
Eltrax stockholders;

- receipt of an opinion of tax counsel to Cereus that the merger will
qualify as a tax-free reorganization for federal income tax purposes; and

- the absence of any injunction or legal restraint prohibiting consummation
of the merger.

Where law permits, Eltrax or Cereus could decide to complete the merger
even though one or more of these conditions has not been met. We cannot be
certain when or if the conditions to the merger will be satisfied or waived, or
that the merger will be completed.

TERMINATION OF THE MERGER AGREEMENT (SEE PAGE 56)

We can mutually agree at any time to terminate the merger agreement without
completing the merger, even if the stockholders of both our companies have
approved it.

Eltrax can terminate the merger agreement if:

- Cereus materially breaches the terms of the bridge facility between
Eltrax and Cereus;

- Steven A. Odom does not execute his employment agreement with Eltrax; or

- Cereus does not execute an amendment to the bridge facility to provide
Eltrax with an additional $5.0 million in borrowing availability under
the bridge facility within 10 business days after the conditions to the
execution have been met. See "The Merger Agreement -- What We Must Do to
Complete the Merger."

Either company can decide, without the consent of the other, to terminate
the merger agreement if:

- the other company's stockholders do not approve the merger;

- the other company materially breaches the merger agreement;

- the approval of any regulatory authority is denied by final nonappealable
action;

6
<PAGE> 14

- the merger has not been completed by December 31, 2000;

- the board of the other company withdraws or materially adversely changes
its recommendation to approve its merger proposal before its stockholder
meeting; or

- certain other conditions to closing of the merger have not been
satisfied.

TERMINATION FEES (SEE PAGE 57)

If the merger agreement is terminated, under certain circumstances, Eltrax
may have to pay to Cereus, or Cereus may have to pay to Eltrax, a termination
fee of either $2.5 million or $5.0 million.

COMPARATIVE MARKET PRICES AND DIVIDENDS (SEE PAGE 23)

Shares of Eltrax common stock and shares of Cereus common stock are both
included on the Nasdaq National Market. Prior to August 28, 2000, Cereus's
common stock was traded on the OTC Bulletin Board. On June 12, 2000, the last
full trading day before the public announcement that the companies had entered
into the merger agreement, shares of Eltrax common stock closed at $7.563 per
share and shares of Cereus common stock closed at $14.125 per share. On August
28, 2000, the last full trading day for which information was available before
this document was printed and mailed, shares of Eltrax common stock closed at
$4.75 per share and shares of Cereus common stock closed at $8.00 per share.

THE STOCKHOLDER MEETINGS

ELTRAX STOCKHOLDERS (PAGE 75)

Meeting Date.

The Eltrax annual meeting will be held on Friday, September 29, 2000, at
Renaissance Waverly Hotel, 2450 Galleria Parkway, Atlanta, Georgia 30339, at
10:00 a.m., local time.

Record Date.

You can vote at the Eltrax annual meeting if you owned Eltrax common stock
at the close of business on August 21, 2000. As of the close of business on the
Eltrax record date, there were 26,093,109 shares of Eltrax common stock issued
and outstanding.

Matters to be Considered.

At the Eltrax annual meeting, Eltrax stockholders will be asked to:

1. approve the merger agreement and the transactions it contemplates,
including:

- the issuance of shares of Eltrax common stock in the merger;

- the assumption of Cereus stock options and warrants and the
conversion of those options and warrants into options and warrants
to purchase shares of Eltrax common stock; and

- the reconfiguration of Eltrax's board of directors.

We sometimes refer to this proposal in this document as the merger
proposal;

2. approve an amendment to Eltrax's articles of incorporation to
increase the authorized shares of common stock to 100,000,000, par value
$.01 per share;

3. approve an amendment to Eltrax's articles of incorporation to
change Eltrax's name to Verso Technologies, Inc.;

4. elect five nominees to the Eltrax board of the directors to serve
until the earlier of the expiration of their terms or the consummation of
the merger;

7
<PAGE> 15

5. adopt the Eltrax 1999 Employee Stock Purchase Plan; and

6. transact such other business as may properly come before the annual
meeting or any adjournments or postponements thereof.

If approved, the amendments to the articles of incorporation will be implemented
only if the merger is completed. The merger will not be completed unless the
stockholders approve the proposal to increase the number of authorized shares of
common stock.

Vote Required.

The Eltrax merger proposal, the proposals to amend the articles of
incorporation and the proposal to adopt the employee stock purchase plan will
require the approval of Eltrax stockholders owning a majority of the shares of
Eltrax common stock represented at the annual meeting and entitled to vote on
those proposals, provided that a quorum is present. Directors will be elected by
a plurality of the votes cast at the annual meeting, meaning the five nominees
receiving the most votes will be elected directors.

Abstentions will have the same effect as votes cast against the proposals.
Broker non-votes will have no effect on the merger proposal or the other
proposals. For the election of directors, abstentions, broker non-votes and
instructions to withhold authority to vote for one or more of the nominees will
result in those nominees receiving fewer votes.

Security Ownership by Certain Beneficial Owners and Management.

As of the close of business on the Eltrax record date, directors and
executive officers of Eltrax and their respective affiliates may be deemed to be
the beneficial owners of shares of Eltrax common stock representing
approximately 8.3% of the outstanding voting power of Eltrax. Each of the
directors and executive officers of Eltrax has indicated that such person
intends to vote or direct the vote of all the shares of Eltrax common stock over
which such person has voting control in favor of the merger proposal and the
election of directors. In addition, concurrently with the execution of the
merger agreement, the Eltrax directors (who as of the record date beneficially
owned approximately 8.2% of the outstanding shares of Eltrax common stock)
entered into a proxy agreement with Cereus pursuant to which the Eltrax
directors granted to Cereus the right to vote all voting securities of Eltrax
held by the Eltrax directors in favor of the merger proposal.

Proxies.

You can revoke your proxy before it is voted either by sending Eltrax a
revocation notice or a new proxy or by attending the Eltrax annual meeting and
voting in person. You will not revoke your proxy simply by attending the Eltrax
annual meeting.

CEREUS STOCKHOLDERS (PAGE 78)

Meeting Date.

The Cereus annual meeting will be held on Friday, September 29, 2000, at
Renaissance Waverly Hotel, 2450 Galleria Parkway, Atlanta, Georgia 30339, at
11:00 a.m., local time.

Record Date.

You can vote at the Cereus annual meeting if you owned Cereus common stock
at the close of business on August 28, 2000. As of the close of business on the
Cereus record date, there were 9,802,049 shares of Cereus common stock issued
and outstanding.

8
<PAGE> 16

Matters to be Considered.

At the Cereus annual meeting, the Cereus stockholders will be asked to:

1. approve the merger agreement;

2. elect seven nominees to the Cereus board of directors to serve
until the earlier of the expiration of their terms or the consummation of
the merger; and

3. transact such other business as may properly come before the Cereus
annual meeting or any adjournments or postponements thereof.

Vote Required.

Security Ownership by Certain Beneficial Owners and Management.

As of the close of business on the Cereus record date, directors and
executive officers of Cereus and their respective affiliates may be deemed to be
the beneficial owners of shares of Cereus common stock representing
approximately 20.2% of the outstanding voting power of Cereus. Each of the
directors and executive officers of Cereus has indicated that such person
intends to vote or direct the vote of all the shares of Cereus common stock over
which such person has voting control in favor of the merger agreement and the
election of directors. In addition, concurrently with the execution of the
merger agreement, the Cereus directors (who as of the record date beneficially
owned approximately 3.5% of the outstanding shares of Cereus common stock)
entered into a proxy agreement with Eltrax pursuant to which the Cereus
directors granted to Eltrax the right to vote all voting securities of Cereus
held by the Cereus directors in favor of the merger agreement.

Proxies.

You can revoke your proxy before it is voted either by sending Cereus a
revocation notice or a new proxy or by attending the Cereus annual meeting and
voting in person. You will not revoke your proxy simply by attending the Cereus
annual meeting.

RECENT DEVELOPMENTS

For the quarter ended March 31, 2000, Eltrax was not in compliance with the
cumulative net cash flow covenant in its loan facility with PNC Bank, National
Association. Eltrax did not achieve the net cash flow required by the covenant
because of accelerated investment in the operations and infrastructure of the
technology services group and lower than expected revenues from the hospitality
services group during the quarter, primarily due to a change in customer
purchasing patterns resulting from the Y2K transition and a decline in
international sales due to the strong U.S. dollar. Eltrax's accelerated
investment in the technology services group resulted from the closing of a
private placement during the first quarter in which Eltrax raised $13.0 million.
On May 15, 2000, PNC Bank waived the non-compliance. In connection with the
waiver and the amendment described below, Eltrax paid PNC Bank a fee of
$250,000.

Eltrax was not in compliance with the net cash flow covenant for the
quarter ended June 30, 2000. In addition, Eltrax was not in compliance with a
covenant regarding year 2000 capital expenditures and a covenant regarding
maximum rental payments under lease arrangements. On July 27, 2000 PNC Bank
waived the non-compliance with each of these covenants. Also on July 27, 2000,
PNC Bank modified the

9
<PAGE> 17

covenants regarding capital expenditures and rental payments for the balance of
fiscal year 2000. In connection with the waiver and covenant modification,
Eltrax issued PNC Bank warrants to purchase 12,532 shares of Eltrax common stock
with certain registration rights. Eltrax expects to obtain a modification to the
net cash flow covenant that contemplates the planned disposition of hospitality
services group, the funding of an additional $5 million under the existing
bridge facility between Eltrax and Cereus and the revised operating plans for
the technology services group.

On May 15, 2000 PNC Bank and Eltrax amended the facility to increase the
requirement that Eltrax maintain undrawn availability under the facility from at
least $1.0 million at all times to at least $3.0 million during the first and
third month of each fiscal quarter and at least $2.0 million during the second
month of each fiscal quarter. In connection with the closing of the bridge
facility with Cereus, PNC Bank and Eltrax amended the PNC Bank facility to
modify the undrawn availability covenant to reduce the requirement that Eltrax
maintain undrawn availability under the facility to at least $1.0 million at all
times before October 1, 2000. After that time, the covenant reverts to the
staged requirements discussed above. As a condition to Cereus's obligation to
amend the bridge facility to provide Eltrax with an additional $5.0 million in
borrowing availability under the bridge facility, PNC Bank has been requested to
maintain the undrawn availability covenant at $1.0 million.

On June 29, 2000 Eltrax announced that as part of its effort to improve its
operational efficiencies and financial performance to prepare for the merger, it
had reorganized operations and eliminated approximately 100 positions held by
employees, as well as most positions held by contract professionals. As a result
of these actions, Eltrax expects to record restructuring costs of approximately
$1.5 million in the second quarter. Eltrax expects the reduction in force, along
with other cost reduction initiatives implemented in the second quarter, will
result in approximately $12.0 million in annualized cash savings.

On June 29, 2000, Eltrax sold 180,000 shares of its common stock in a
private placement to an investor for aggregate cash consideration of $990,000.

On July 19, 2000, Eltrax's board of directors formally determined to
dispose of Eltrax's hospitality services group. As such, Eltrax has begun
accounting for the hospitality services group as a discontinued operation.

On July 27, 2000, Eltrax entered into an agreement with two investors to
issue $7.0 million of convertible senior subordinated notes. The notes are due
July 27, 2001 and carry warrants to purchase 364,584 shares of common stock at
an exercise price of $5.03 per share. The notes are convertible into Eltrax's
common stock at a price of $4.80 per share. The conversion price is subject to
adjustment upon the occurrence of certain events. The notes also have certain
put and call features. Concurrent with the execution of the agreement, $4.0
million dollars was funded by the investors. An additional $1.0 million will be
funded immediately upon Eltrax's execution of a definitive agreement to sell all
or part of its hospitality services group for proceeds of at least $8.0 million.
The remaining $2.0 million will be funded upon the closing of the merger. Eltrax
will file a registration statement with the Securities and Exchange Commission
within 30 days to register for resale the shares of common stock issuable upon
exercise of the warrants and conversion of the notes.

10
<PAGE> 18

SELECTED CONSOLIDATED HISTORICAL FINANCIAL AND
OPERATING DATA OF ELTRAX

We are providing the following financial information to help you analyze
the merger. This financial information is derived from Eltrax's historical
consolidated financial statements. The results of operations for the six months
ended June 30, 2000 are not necessarily indicative of results that may be
expected for the full fiscal year. This information is only a summary and should
be read in conjunction with Eltrax's consolidated financial statements and
related notes and Eltrax's "Management's Discussion and Analysis of Financial
Condition and Results of Operations", which are incorporated by reference in
this document and contained in Eltrax's annual reports, quarterly reports, and
other information on file with the Securities and Exchange Commission (the
"SEC").

<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
----------------- -----------------------------------------------
2000 1999 1999(B) 1998 1997(C) 1996 1995
------- ------- ------- ------- ------- ------- -------
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Statement of Operations Data(a):
Revenue........................... $17,729 $15,059 $61,685 $52,605 $49,934 $34,649 $17,256
Net Income(loss) from continuing
operations...................... (13,088) (1,379) (5,884) (1,764) (10,193) (760) 191
Net Income (loss) from continuing
operations per common share --
basic and diluted............... (.51) (.06) (.25) (.08) (.57) (.05) .01
Balance Sheet Data:
Total assets...................... $53,540 $63,470 $56,054 $69,981 $63,697 $64,019 $53,703
Long-term obligations............. -- 2,399 54 3,341 1,408 -- --
</TABLE>

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

(a) Includes the operations of the following companies acquired by Eltrax from
their respective dates of acquisition: Nordata, Inc. and Rudata, Inc. (May
17, 1996), Four Corners Technology, Inc. (July 1, 1997), Hi-Tech
Connections, Inc. (August 1, 1997), DataComm Associates, Inc. and Midwest
Telecom Associates, Inc. (October 31, 1997) and Encore Systems, Inc.
(September 1, 1998). The results of Atlantic Network Systems, Inc., EJG
Techline Incorporated, Sulcus Hospitality Technologies Corp. and Windward
Technologies, Inc., have been included for all periods represented. These
four companies merged with Eltrax on October 31, 1996, May 17, 1997, March
26, 1999, and March 31, 1999, respectively, in transactions accounted for
as poolings-of-interests. On January 31, 1997, Eltrax acquired certain
assets of the MST Distribution Business from MRK Technologies, LTD.

(b) The 1999 loss from operations includes $713,000 in non-recurring
merger-related transaction and reorganization costs.

(c) The 1997 loss from operations includes $5.7 million in asset impairments
and $1.3 million in income taxes resulting from the recognition of a full
valuation allowance on deferred tax assets of Eltrax.

11
<PAGE> 19

SELECTED CONSOLIDATED HISTORICAL FINANCIAL AND
OPERATING DATA OF CEREUS

We are providing the following financial information to help you analyze
the merger. This financial information is derived from Cereus's unaudited
financial statements for the six months ended June 30, 2000 and June 30, 1999
and Cereus's audited financial statements for the years ended December 31, 1999
through December 31, 1995. The results of operations for the six months ended
June 30, 2000 are not necessarily indicative of results that may be expected for
the full fiscal year. This information is only a summary and should be read in
conjunction with Cereus's "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and Cereus's consolidated financial
statements and related notes contained elsewhere in this document.

<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
---------------- -------------------------------------------
2000 1999 1999(A) 1998 1997 1996 1995
------- ------ ------- ------ ------ ------ ------
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Statement of Operations Data(a)(b):
Revenue............................ $ 3,574 $ -- $ 1,696 $ -- $ -- $ -- $ --
Net loss before extraordinary
item............................ (11,370) -- (3,458) -- -- -- --
Net loss per common share from
continuing operations -- basic
and diluted..................... (1.41) -- (1.57) -- -- -- --
Net loss per share before
extraordinary items............. (1.44) (0.28) (3.26) (0.32) (0.37) (0.31) (0.25)
Balance Sheet Data:
Total assets....................... $23,348 $5,110 $13,559 $5,155 $4,924 $5,354 $5,703
Long-term obligations.............. 81 165 36 1,229 1,143 1,126 822
</TABLE>

---------------
(a) Includes the operations of the following companies acquired by Cereus from
their respective dates of acquisition: Enterprise Solutions Group, Inc.
(July 30, 1999); The Reddy Group, Inc. and its wholly owned subsidiary,
Cereus Bandwidth LLC (July 30, 1999); and Client Server Solutions, Inc. and
CSS Financial Software Sales, Inc. (each on November 15, 1999).

(b) Excludes (i) losses from discontinued operations of $236,000 and $398,000
for the six months ended June 30, 2000 and June 30, 1999, respectively; (ii)
losses from discontinued operations of approximately $3.7 million for the
year ended December 31, 1999; and (iii) an extraordinary loss from debt
conversion of approximately $7.2 million in the quarter ended March 31,
2000.

12
<PAGE> 20

COMPARATIVE PER SHARE DATA

The table below presents the high and low sales prices per share of Eltrax
common stock on the Nasdaq National Market and Cereus common stock on the OTC
Bulletin Board on June 12, 2000, the last full trading day immediately preceding
the public announcement of the proposed merger. As of August 28, 2000, shares of
Cereus common stock began trading on the Nasdaq National Market. The table below
also presents the high and low sales prices per share of Eltrax and Cereus
common stock on the Nasdaq National Market on August 28, 2000, the most recent
practicable date before this document was printed and mailed, as well as the
"equivalent stock price" of shares of Cereus common stock on June 12, 2000 and
August 28, 2000. The "equivalent stock price" of shares of Cereus common stock
represents the per share sales price for Eltrax's common stock on the Nasdaq
National Market at the specified date multiplied by the exchange ratio of 1.75,
which is the number of shares of Eltrax common stock that a Cereus stockholder
would receive for each share of Cereus common stock, assuming that before
September 1, 2000 (which date may be extended to September 18, 2000 under
certain circumstances), Cereus amends the existing bridge facility to provide
Eltrax with an additional $5.0 million in borrowing availability under the
bridge facility. See "The Merger Agreement -- Additional Agreements" and "The
Merger Agreement -- Merger Consideration." Keep in mind that because of market
price fluctuations the "equivalent stock price" may be greater than or less than
the value of the Eltrax common stock and cash in lieu of fractional shares that
a Cereus stockholder will receive for each share of Cereus common stock in
connection with the merger. Stockholders should consider the current exchange
ratio and obtain current market quotations for shares of Eltrax common stock and
Cereus common stock before making any decision with respect to the merger. See
"The Merger Agreement -- Merger Consideration."

<TABLE>
<CAPTION>
ELTRAX CEREUS CEREUS EQUIVALENT
COMMON STOCK COMMON STOCK STOCK PRICE
(PRICE PER SHARE) (PRICE PER SHARE) (PRICE PER SHARE)
----------------- ----------------- -----------------
HIGH LOW HIGH LOW HIGH LOW
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
June 12, 2000......................... $8.125 $7.031 $14.125 $14.000 $14.219 $12.304

August 28, 2000....................... $4.844 $4.625 $ 8.250 $ 7.250 $ 8.477 $ 8.094
</TABLE>

After the merger, shares of Cereus common stock will no longer be publicly
traded.

13
<PAGE> 21

HISTORICAL AND PRO FORMA PER SHARE DATA
OF ELTRAX AND CEREUS

The following table shows information about net income per share of common
stock and book value per share of common stock of Cereus and Eltrax. The
unaudited pro forma data below is for illustrative purposes only. The pro forma
net loss per common share information has been prepared as if the merger and a
private placement to two investors had taken place on January 1, 1999. The pro
forma book value per share information has been prepared as if the merger and
the private placement had taken place as of each of the dates presented.
Information identified as "Equivalent pro forma amount of Cereus" was obtained
by multiplying the related pro forma amounts by the exchange ratio of 1.75. This
information is presented to reflect the fact that Cereus stockholders will
receive 1.75 shares of Eltrax common stock for each share of Cereus common stock
after the merger, assuming that before September 1, 2000 (which date may be
extended to September 18, 2000, under certain circumstances) Cereus amends the
existing bridge loan facility to provide Eltrax with an additional $5.0 million
in borrowing availability under the bridge facility. See "The Merger
Agreement -- Additional Agreements" and "The Merger Agreement -- Merger
Consideration." You should read the information below together with our
historical financial statements and related notes thereto contained elsewhere or
incorporated by reference in this document. You should also read the information
contained in "Unaudited Pro Forma Condensed Consolidated Financial Information"
contained elsewhere in this document. You should not rely on this information as
being indicative of the historical results that would have been achieved had the
companies always been combined.

<TABLE>
<CAPTION>
AS OF AND FOR THE AS OF AND FOR THE
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 2000 DECEMBER 31, 1999
----------------- -----------------
<S> <C> <C>
NET LOSS PER COMMON SHARE BEFORE DISCONTINUED OPERATIONS AND
EXTRAORDINARY ITEMS(1)
Eltrax, Historical
Basic and diluted......................................... $(0.69) $(0.25)
Cereus, Historical
Basic and diluted......................................... (1.41) (1.57)
Pro Forma Consolidated(2)
Basic and diluted......................................... (1.18) (1.59)
Equivalent Pro Forma Amount for Cereus
Basic and diluted......................................... (2.06) (2.79)
BOOK VALUE PER COMMON SHARE(1)
Eltrax, Historical.......................................... 0.50 1.13
Cereus, Historical.......................................... 2.24 1.40
Pro Forma Consolidated(2)................................... 2.69 3.19
Equivalent Pro Forma Amount for Cereus...................... 4.71 5.57
</TABLE>

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

(1) The calculation of basic net loss per share uses the weighted average number
of common shares outstanding. Common stock equivalents have been excluded
from loss per share calculations because their inclusion would be
anti-dilutive.

(2) The calculation of basic and diluted net loss per share does not include the
effect of additional equity or asset sale transactions that may be effected
to satisfy a condition to completion of the merger.

14
<PAGE> 22

RISK FACTORS

You should consider the following risk factors in determining how to vote.

RISKS RELATED TO OUR BUSINESS AFTER THE MERGER

WE MAY BE UNABLE TO MEET OUR FUTURE WORKING CAPITAL REQUIREMENTS.

At June 30, 2000, Eltrax had a negative working capital position (excess of
current liabilities over current assets) of $5.2 million. Eltrax's net cash
position (deficit), defined as the sum of cash, cash equivalents and short-term
investments less short term borrowings and long-term debt, was $(17.3 million)
at June 30, 2000, compared to $(9.9 million) at December 31, 1999.

Commencing in the second quarter, due to greater losses than anticipated in
the second quarter and the resultant shortage of available cash, Eltrax had not
made timely payments to all of its trade and other creditors. As of June 30,
2000, Eltrax had payables which were more than 30 days past due in the amount of
approximately $4.9 million relating to continuing operations. Eltrax has
negotiated deferred payment terms with most of these creditors.

We expect to meet our short-term working capital needs with cash on hand,
borrowings under our bank facility, the proceeds from the sale of all or a
portion of the hospitality services group, and up to $3.0 million in proceeds
from the funding of convertible senior subordinated notes. See "Additional
Information about Eltrax -- Recent Developments." We cannot meet our working
capital needs without these capital sources. Our ability to access that capital
is contingent on events, most of which are outside our control. For example,
Eltrax has entered into a letter of intent with respect to the sale of its
lodging and international business and is in discussions for the sale of its
subsidiary, Squirrel Systems, Inc. However, the consummation of both of those
transactions is contingent on the negotiation and execution of a definitive
agreement and the completion of due diligence and other matters customary in
transactions of that sort.

While we expect to be able to close both of these transactions, there can
be no assurance that either or both of the transactions will close. Also, there
can be no assurance that the $3.0 million of convertible senior subordinated
notes will be funded because the funding of $1.0 million of the notes is
contingent on the execution of a definitive agreement for the sale of all or a
portion of Eltrax's hospitality services group for gross proceeds of at least
$8.0 million and the funding of $2.0 million of the notes is contingent on the
closing of the merger.

Finally, our ability to access our bank facility is contingent on our
compliance with the financial and other covenants and terms of that facility. If
we are in violation of the bank facility, or do not have sufficient eligible
accounts receivable to support the level of borrowings we need, we will be
unable to draw on the facility.

If any of these contingencies is not satisfied or we are in violation of
the bank facility so that we do not have access to any one of these sources of
capital through the remainder of the 2000 fiscal year, then our ability to
continue to operate would be jeopardized. In this event, we would be forced to
seek working capital from other sources to fund delinquent accounts payable and
meet ongoing trade obligations. However, there can be no assurance that other
financing sources will be available to meet our needs at that time.

We expect to meet our long-term liquidity needs through a combination of
funds from operations, draws on our bank facility and proceeds from issuances of
debt and equity securities in the capital markets. There can be no assurance,
however, that these sources of liquidity will be available to us on favorable
terms or at all.

OUR FUTURE RESULTS OF OPERATIONS ARE UNCERTAIN BECAUSE WE ARE SIGNIFICANTLY
REFOCUSING OUR BUSINESS.

We believe that the technology services and ASP markets will grow
significantly over the next five years. As a result, we intend to refocus our
business efforts to devote our energy and resources to promote

15
<PAGE> 23

and develop the technology services group as a full service provider,
particularly its ASP offerings. As part of this process, Eltrax is pursuing the
disposition of its hospitality services group. As such, Eltrax has begun
accounting for the hospitality services group as a discontinued operation and
our historical results of operations, which are the result of our old business
strategy, may not give you an accurate indication of how we will perform in the
future.

CEREUS IS A DEVELOPMENT STAGE COMPANY AND HAS A LIMITED OPERATING HISTORY.

Cereus has only a limited operating history in its e-business and B2B
technology business, and its prospects must be evaluated with a view to the
risks encountered by a company in an early stage of development, particularly in
light of the uncertainties relating to the new and evolving markets in which
Cereus intends to operate and the acceptance of Cereus's business model. In
addition, Cereus's limited operating history in its e-business and B2B
technology business makes the prediction of its future operating results
difficult or impossible.

ELTRAX AND CEREUS HAVE A HISTORY OF LOSSES AND THE COMBINED COMPANY MAY NOT BE
PROFITABLE IN THE FUTURE.

Eltrax and Cereus have a history of net losses. Eltrax had a net loss of
$31.6 million for the six months ended June 30, 2000 and a net loss of $9.8
million for the year ended December 31, 1999. Cereus had a net loss of $18.6
million for the six months ended June 30, 2000 and a net loss of $7.2 million
for the year ended December 31, 1999. Further, executing the combined company's
business strategy and expanding its services will require significant additional
capital and other expenditures. Accordingly, we anticipate continuing to
generate net losses in the future.

THE COMBINED COMPANY'S SUCCESS DEPENDS ON THE ACCEPTANCE AND INCREASED USE OF
BOTH INTERNET-BASED BUSINESS SOFTWARE SOLUTIONS AND ITS NEW PRODUCTS AND
SERVICES, AND WE CANNOT BE SURE THAT THIS WILL HAPPEN.

The combined company's business model depends in large part on the adoption
of Internet-based business software solutions by its target market of middle
market commercial users. Its business could suffer dramatically if
Internet-based software solutions are not accepted or are not perceived to be
effective. The market for Internet services, private network management
solutions and widely distributed Internet-enabled packaged application software
has only recently begun to develop, and we believe many of our potential
customers are not aware of the benefit of the outsourced solutions we provide.

The growth of Internet-based business software solutions could also be
limited by:

- concerns over transaction security and user privacy;

- inadequate network infrastructure for the Internet; and

- inconsistent performance of the Internet.

We cannot be certain that commercial customers will accept and employ
Internet-based software solutions or that this market will grow at the rate we
expect. If this market does not grow or grows more slowly than our predictions,
the combined company's financial condition and results of operations would be
adversely affected.

Additionally, many of the combined company's products and services are
based on new or improved technologies that have not previously been available.
We will have to overcome the difficulties inherent in the introduction of new or
improved technologies to the market, including our ability to demonstrate to
customers the technical capabilities and the value of these new technologies,
and there is no assurance that we can do so successfully. Lack of market
acceptance of our products and services would adversely affect the combined
company's business.

16
<PAGE> 24

WE MAY NOT BE ABLE TO DELIVER OUR SERVICES IF THIRD PARTIES DO NOT PROVIDE US
WITH KEY COMPONENTS OF OUR INFRASTRUCTURE.

We depend on other companies such as software vendors and equipment
manufacturers to supply us with key components of the computer and
telecommunications equipment and the telecommunications services that we use to
provide our application hosting services. A disruption in our ability to provide
hosting services could prevent us from maintaining the required standards of
service, which would cause us to incur contractual penalties, and would harm our
business. Additionally, if any of our significant software vendors stop making
their products available to us or choose to compete against us, our business
would be harmed. Moreover, our success depends upon the continued popularity of
the product offerings of these vendors and on our ability to establish
relationships with new vendors in the future. If we are unable to obtain
packaged applications from these or comparable vendors or if our vendors choose
to compete with us or the popularity of their products declines, our ability to
customize, implement or host packaged software applications may be adversely
affected.

IF WE ARE UNABLE TO EFFICIENTLY INTEGRATE AND OPERATE RECENT ACQUISITIONS, OUR
BUSINESS WOULD BE HARMED.

During the last five years, Eltrax has merged with or acquired ten
companies and Cereus has merged with or acquired three companies, excluding its
discontinued operations. The rapid growth associated with these acquisitions and
the difficulties each company has experienced in integrating these businesses
has placed, and will continue to place, a significant strain on the combined
company's systems, controls and managerial resources. The management teams of
Eltrax and Cereus have expended significant time and effort in integrating the
operations of acquired businesses. We expect to continue to expend significant
resources in integrating those companies and other companies the combined
company may acquire. If we do not accomplish these tasks, the combined company's
financial condition and results of operations may be materially and adversely
affected.

THE COMBINED COMPANY WILL DEPEND ON KEY PERSONNEL.

The combined company will be highly dependent on the services of several
key executive officers and technical employees, many of whom could be difficult
to replace and the loss of any of whom could have a material adverse effect on
its business, financial condition and results of operations. The combined
company will enter into executive employment agreements with each of Messrs.
Odom and Logsdon and Ms. Reising. In addition, the combined company will need to
hire additional skilled personnel to support the continued growth of its
business. The market for skilled personnel, especially those with the technical
abilities required by the combined company, is currently very competitive, and
the combined company must compete with much larger companies with significantly
greater resources to attract and retain such personnel. In addition, the senior
officers of the combined company after the merger have worked together for less
than one year. There can be no assurance that they will function successfully as
a management team to implement the combined company's strategy. See "The Merger
Agreement--Management and Boards of Directors after the Merger."

THE MARKETS THE COMBINED COMPANY WILL SEEK TO SERVE ARE HIGHLY COMPETITIVE, AND
MANY OF ITS COMPETITORS HAVE MUCH GREATER RESOURCES.

Competition in the information technology services industry is intense and
is expected to increase. Many of the combined company's competitors have
substantially greater financial, technical and marketing resources, larger
customer bases, longer operating histories, greater name recognition and more
established relationships in the industry than either Eltrax or Cereus.
Additionally, there are relatively few barriers to entry in our business that
would prevent new competitors from entering our industry. If we are not able to
compete effectively, the combined company's financial condition and results of
operations may be materially and adversely affected.

17
<PAGE> 25

THE COMBINED COMPANY'S SUCCESS DEPENDS ON ITS ABILITY TO KEEP UP WITH RAPID
TECHNOLOGICAL DEVELOPMENTS AND EVOLVING INDUSTRY STANDARDS.

The Internet is characterized by rapidly changing technology, evolving
industry standards, and frequent new service and product announcements,
introductions and enhancements. The combined company's future success will
depend on our ability to adapt our services to rapidly changing technologies and
evolving industry standards, to continually improve the performance, features
and reliability of our services and to insure the continued compatibility of our
services with products, services and architectures offered by various vendors or
any prevailing standard. If we do not keep up with those changes, the combined
company's business may suffer.

INTELLECTUAL PROPERTY INFRINGEMENT CLAIMS AGAINST THE COMBINED COMPANY, EVEN
WITHOUT MERIT, COULD REQUIRE IT TO ENTER INTO COSTLY LICENSES OR DEPRIVE IT OF
TECHNOLOGY IT NEEDS.

Our industry is technology intensive. As the number of software products in
the combined company's target markets increases and the functionality of these
products further overlap, third parties may claim that the technology we develop
or license infringes their proprietary rights. Any infringement claims, even
without merit, could require us to enter into costly royalty or licensing
agreements to avoid service implementation delays. If successful, a claim of
product infringement could deprive the combined company of the technology it
requires altogether. Any of these outcomes could harm the combined company's
business.

FAILURE TO PROTECT OUR INTELLECTUAL PROPERTY RIGHTS COULD HAVE A MATERIAL
ADVERSE EFFECT ON OUR BUSINESS.

Our success depends in part upon the protection of our proprietary
application software and hardware products. Both Eltrax and Cereus have taken
steps that they believe are adequate to establish, protect and enforce their
intellectual property rights. However, we cannot assure you that these efforts
to safeguard and maintain those proprietary rights will be successful.

Furthermore, the laws of many foreign countries in which the combined
company will do business do not protect intellectual property rights to the same
extent or in the same manner as do the laws of the United States. Although we
have implemented and will continue to implement protective measures in those
countries, these efforts may also not be successful. Additionally, even if our
domestic and international efforts are successful, our competitors may
independently develop non-infringing technologies that are substantially similar
or superior to our technologies.

WE DERIVE A SIGNIFICANT PORTION OF OUR REVENUE FROM INTERNATIONAL OPERATIONS.

Eltrax's international operations, which are a component of the hospitality
services group for which we are continuing to pursue the disposition,
represented approximately 13.3% and 18.5% of its total revenue for the six
months ended June 30, 2000 and the year ended December 31, 1999, respectively.
The largest portion of this international revenue is generated in the Pacific
Rim region, which represented approximately 3.9% and 7.4% of Eltrax's total
revenue for the six months ended June 30, 2000 and the year ended December 31,
1999, respectively. Ongoing business in international markets will subject the
combined company to a wide variety of risks, including:

- unexpected changes in legal and regulatory requirements;

- new tariffs or other barriers to certain international markets;

- difficulties in staffing and managing foreign operations;

- regional economic factors, including recessions, hyperinflation or other
adverse economic developments;

- longer payment cycles and greater difficulty in collecting accounts
receivable;

- the possibility of expropriation;

18
<PAGE> 26

- limitations on the repatriation of investment income, capital stock and
other assets;

- unstable political environments;

- potentially adverse tax consequences; and

- gains and losses on foreign currency conversion.

LEGAL UNCERTAINTIES AND GOVERNMENT REGULATION COULD ADD ADDITIONAL COSTS TO
DOING BUSINESS ON THE INTERNET AND COULD LIMIT OUR CLIENTS' USE OF THE INTERNET.

The laws governing the Internet remain largely unsettled. It may take years
to determine whether and how existing laws, such as those governing intellectual
property, privacy, libel, taxation and the need to qualify to do business in a
particular state, apply to the Internet. This legal uncertainty could slow the
growth in Internet use and decrease the acceptance of the Internet as a
commercial medium, which could harm our business.

In response to this legal uncertainty and the growing use of the Internet,
laws and regulations directly applicable to communications or commerce over the
Internet are becoming more prevalent. The adoption or modification of laws or
regulations relating to the Internet and Internet-based businesses could harm
our business.

ELTRAX'S REVENUES HAVE HISTORICALLY DEPENDED UPON THE HOSPITALITY AND TOURISM
INDUSTRY AND WILL CONTINUE TO DO SO IF WE ARE UNSUCCESSFUL IN IMPLEMENTING OUR
BUSINESS PLAN.

Eltrax's historic results of operations depended upon demand for its
products and services in the hospitality and tourism industry. Although the
combined company's business model focuses on growing the technology services
group to penetrate the network, application and ASP markets, so long as we
operate the hospitality services group, we will continue to rely on those
industries for revenue, and any decline in capital spending by the hospitality
and tourism industry, in general, or by our key customers in those industries,
in particular, could have a material adverse effect on our business, operating
results and financial condition.

RISKS RELATED TO THE MERGER

FLUCTUATIONS IN THE MARKET PRICE OF ELTRAX COMMON STOCK WILL AFFECT THE VALUE OF
THE CONSIDERATION CEREUS STOCKHOLDERS RECEIVE IN THE MERGER.

The value of the consideration that Cereus stockholders will receive in the
merger will depend on the market price of Eltrax common stock. There will be no
adjustment in the exchange ratio based on fluctuations in the market price of
Eltrax common stock.

On the day of the merger, the market price of Eltrax common stock may be
higher or lower than the market price on the date the merger agreement was
signed, on the date this document was mailed to you or on the date of the Cereus
annual meeting. Therefore, you cannot be assured of receiving any specific
market value of shares of Eltrax common stock on the date of the merger, and we
encourage you to consider the market price of Eltrax common stock before you
make your voting decision regarding the merger. See "The Merger -- Merger
Consideration."

THE NUMBER OF SHARES OF ELTRAX COMMON STOCK CEREUS STOCKHOLDERS WILL RECEIVE IN
THE MERGER MAY BE ADJUSTED DOWNWARD.

The exchange ratio will be adjusted downward from 1.75 to 1.667 shares of
Eltrax common stock for each share of Cereus common stock if Cereus does not
amend the existing bridge loan facility before September 1, 2000 (which date may
be extended to September 18, 2000 under certain circumstances) to provide Eltrax
with an additional $5.0 million in borrowing availability under the bridge
facility. If the exchange ratio is adjusted to 1.667 shares of Eltrax common
stock for each share of Cereus common stock, it may be adjusted further downward
if Eltrax sells all or any part of its hospitality services group

19
<PAGE> 27

for $8.0 million or more in cash in the aggregate before the merger. Therefore,
on the day of the merger, the exchange ratio may be less than the exchange ratio
initially agreed to by Eltrax and Cereus on the date the merger agreement was
signed, on the date this document was mailed to you or on the date of the Cereus
annual meeting. We will post the current exchange ratio on Eltrax's Web site at
www.eltrax.com and on Cereus's Web site at www.cereus.net. You may also find out
the current exchange ratio by calling D.F. King & Co., Inc. at 1-800-549-6476.
We encourage you to consider the current exchange ratio before you make your
voting decision regarding the merger. See "The Merger Agreement -- Additional
Agreements" and "The Merger Agreement -- Merger Consideration."

HISTORICALLY LOW TRADING VOLUME IN ELTRAX AND CEREUS COMMON STOCK MAY AFFECT
STOCKHOLDER LIQUIDITY.

The trading volume of Eltrax common stock on the Nasdaq National Market and
the trading volume of Cereus common stock on the OTC Bulletin Board has been low
historically. In the merger, Eltrax will be issuing approximately 17.1 million
shares to Cereus stockholders (assuming no adjustment in the exchange ratio and
assuming that none of the options or warrants to acquire Cereus common stock
that are exercisable before the merger are exercised). Based on these
assumptions and provided that no options and warrants to purchase Eltrax common
stock are exercised, after the merger, approximately 43.2 million shares of
Eltrax common stock will be issued and outstanding. However, there can be no
assurance that the increased "float" will allow stockholders to sell shares of
Eltrax common stock at the times and at the prices they desire.

THE PRICE OF ELTRAX COMMON STOCK HAS FLUCTUATED WIDELY.

The stock market in general, and the market for technology and
Internet-related companies in particular, has recently experienced extreme
volatility that has often been unrelated to the operating performance of
particular companies. Since January 1, 1999, the per share sales price of
Eltrax's common stock on the Nasdaq National Market fluctuated from a low of
$3.125 to a high of $19.75. Eltrax believes that the volatility of its stock
price does not necessarily relate to its performance and is broadly consistent
with volatility experienced in our industry. Fluctuations may occur, among other
reasons, in response to:

- operating results;

- announcements by competitors;

- regulatory changes;

- economic changes;

- market valuation of technology firms; and

- general market conditions.

In addition, in order to respond to competitive developments, the combined
company may from time to time make pricing, service or marketing decisions that
could harm its business. Also, the combined company's operating results in one
or more future quarters may fall below the expectations of securities analysts
and investors. In either case, the trading price of the combined company's
common stock would likely decline.

The trading price of Eltrax common stock could continue to be subject to
wide fluctuations after the merger in response to these or other factors, many
of which are beyond our control. If the market price of Eltrax common stock
decreases, stockholders may not be able to sell their Eltrax stock at a profit.
See "Comparative Market Prices and Dividends."

WE MAY BE UNABLE TO SUCCESSFULLY INTEGRATE OUR OPERATIONS.

The merger involves the integration of two companies that have previously
operated independently. The difficulties of combining the companies' operations
include integrating personnel with diverse business backgrounds and combining
different corporate cultures. The process of integrating operations could cause
20
<PAGE> 28

an interruption of, or loss of momentum in, the activities of one or more of the
combined company's businesses and the loss of key personnel. The diversion of
management's attention and any delays or difficulties encountered in connection
with the merger and the integration of the two companies' operations could have
an adverse effect on the business, results of operations or financial condition
of the combined company.

WE WILL INCUR SIGNIFICANT MERGER-RELATED AND INTEGRATION-RELATED EXPENSES.

Merger-related transaction costs will be recorded as a component of the
consideration paid for Cereus. These merger-related transaction costs consist
principally of charges related to investment banking fees, professional
services, registration and other regulatory costs, and are expected to be
approximately $1,223,000. Additional fees and costs may be incurred in
connection with the sale of equity or assets necessary to satisfy a condition to
consummation of the merger. In addition, we expect to incur pre-tax charges to
operations to reflect costs associated with combining the operations of the two
companies. These charges will be determined and recorded after the merger.
Additional unanticipated expenses may be incurred in the integration of our
businesses. Although we expect that the elimination of duplicative expenses as
well as the realization of other efficiencies related to the integration of the
businesses may result in cost savings, we cannot assure you that these benefits
will be achieved in the near term or at all.

THE COMBINED COMPANY DOES NOT EXPECT TO PAY ANY DIVIDENDS IN THE FORESEEABLE
FUTURE.

Neither Eltrax nor Cereus has ever paid dividends on its common stock, and
the combined company does not anticipate paying cash dividends in the
foreseeable future. We intend to retain any earnings to finance the development
of our business and, consequently, may never pay cash dividends. Eltrax's bank
line of credit prohibits the payment of dividends.

21
<PAGE> 29

FORWARD-LOOKING STATEMENTS

This document, including "Summary," "Risk Factors," "The Merger -- Reasons
for the Merger" "The Merger -- Recommendations of the Eltrax and Cereus Boards
of Directors" and other sections, contains certain statements that constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements include certain
statements regarding intent, belief or current expectations about matters
(including statements as to "beliefs," "expectations," "anticipations,"
"intentions" or similar words). Forward-looking statements are also statements
that are not statements of historical fact. Because these statements are based
on factors that involve risks and uncertainties, actual results may differ
materially from those expressed or implied by the forward-looking statements.
These factors include, among others:

- our ability to successfully penetrate the network, application and ASP
markets;

- our ability to dispose of our hospitality services group;

- our ability to fund continuing operating losses and capital requirements;

- trends for the continued growth of the business of Eltrax and Cereus;

- our ability to successfully access the capital markets to fund the growth
of our business;

- our ability to enhance revenue and earnings growth;

- our ability to continue to successfully market existing products and
services, which may be adversely impacted by competition;

- our ability to integrate the two businesses and other prior and
subsequent mergers and acquisitions;

- our ability to successfully develop and market new products and services;

- our ability to expand our market for existing products and services;

- the effects of our accounting policies and general changes in generally
accepted accounting practices;

- general economic and business conditions; and

- other risks and uncertainties included in the section titled "Risk
Factors."

22
<PAGE> 30

COMPARATIVE MARKET PRICES AND DIVIDENDS

Eltrax common stock is traded on the Nasdaq National Market under the
symbol "ELTX." As of August 28, 2000, Cereus common stock is traded on the
Nasdaq National Market under the symbol "CEUS." Prior to that, Cereus common
stock was traded on the OTC Bulletin Board under the symbol "CEUS." The
following table presents the per share historical high and low sale prices of
Eltrax common stock and the per share historical high and low bid/sale prices of
Cereus common stock (reflecting inter-dealer quotations for bid prices) for the
periods indicated. The stock prices do not include retail mark-ups, mark-downs
or commissions. Neither Eltrax nor Cereus paid any dividends on its common stock
during these periods. After the merger, we intend to retain any earnings to
finance the development of our business and, consequently, may never pay cash
dividends. In addition, our bank line of credit prohibits the payment of
dividends.

<TABLE>
<CAPTION>
ELTRAX CEREUS
COMMON STOCK COMMON STOCK
SALE PRICE BID/SALE PRICE
---------------- ----------------
HIGH LOW HIGH LOW
------- ------ ------- ------
<S> <C> <C> <C> <C> <C>
1998 First Quarter.................................. $ 7.250 $4.875 $ 1.047 $ .219
Second Quarter................................. 10.375 5.750 2.000 .625
Third Quarter.................................. 8.375 3.750 3.500 3.100
Fourth Quarter................................. 8.000 3.875 4.000 2.500
1999 First Quarter.................................. 6.125 3.813 5.000 2.750
Second Quarter................................. 5.000 3.375 7.000 3.110
Third Quarter.................................. 4.438 3.125 5.500 4.000
Fourth Quarter................................. 9.500 3.375 5.375 3.250
2000 First Quarter.................................. 19.750 7.625 26.000 3.750
Second Quarter................................. 13.750 4.125 18.000 8.125
Third Quarter (through August 28, 2000)........ 6.563 3.750 8.500 6.750
</TABLE>

On June 12, 2000, the last full trading day before the execution of the
merger agreement was publicly announced, the reported closing sales price of
Eltrax common stock on the Nasdaq National Market was $7.563 per share, and the
reported closing sales price of Cereus common stock on the OTC Bulletin Board
was $14.125 per share. On August 28, 2000, the last full trading day for which
information was available before this document was printed and mailed, the
reported closing sales price of Eltrax common stock on the Nasdaq National
Market was $4.75 per share, and the reported closing sales price of Cereus
common stock on the Nasdaq National Market was $8.00 per share.

On August 21, 2000, there were 3,265 holders of record of Eltrax common
stock and on August 28, 2000 there were 798 holders of record of Cereus common
stock.

23
<PAGE> 31

THE MERGER

The discussion of the merger and the merger agreement in this document does
not purport to be complete and is subject to, and qualified in its entirety by
reference to, the merger agreement. A copy of the merger agreement is attached
to this document as Appendix A. We urge all stockholders to read the entire
merger agreement.

OVERVIEW

We are furnishing this document to Eltrax stockholders and Cereus
stockholders in connection with the solicitation of proxies for use at each of
their annual stockholder meetings.

Eltrax Proposals

At the Eltrax annual meeting, holders of Eltrax common stock will be asked
to:

- approve the Eltrax merger proposal;

- approve an amendment to Eltrax's articles of incorporation to increase
the authorized shares of common stock to 100,000,000, par value $.01 per
share;

- approve an amendment to Eltrax's articles of incorporation to change
Eltrax's name to Verso Technologies, Inc.;

- elect five nominees to the Eltrax board of directors to serve until the
earlier of the expiration of their terms or the consummation of the
merger; and

- adopt the Eltrax 1999 Employee Stock Purchase Plan.

Cereus Proposals

At the Cereus annual meeting, holders of Cereus common stock will be asked
to:

- approve the merger agreement; and

- elect seven nominees to the Cereus board of directors to serve until the
earlier of the expiration of their terms or the consummation of the
merger.

The merger will not be completed unless Cereus's stockholders approve the merger
agreement.

The merger agreement provides that a wholly-owned subsidiary of Eltrax will
be merged with and into Cereus. Cereus will be the surviving corporation and
will become a wholly-owned subsidiary of Eltrax. In the merger, each outstanding
share of Cereus common stock will be converted into the right to receive 1.75
shares of Eltrax common stock. The exchange ratio will be adjusted downward to
1.667 shares of Eltrax common stock for each share of Cereus common stock if
Cereus does not amend the existing bridge loan facility before September 1, 2000
(which date may be extended to September 18, 2000 under certain circumstances)
to provide Eltrax with an additional $5.0 million in borrowing availability
under the bridge facility. If the exchange ratio is adjusted to 1.667 shares of
Eltrax common stock, it may be adjusted downward further if Eltrax sells all or
any part of its hospitality services group for $8.0 million or more in cash in
the aggregate before the merger. See "The Merger Agreement--Additional
Agreements" and "The Merger Agreement--Merger Consideration."

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<PAGE> 32

BACKGROUND OF THE MERGER

The respective management groups of Eltrax and Cereus review, on a
continuing basis, the strategic focus of their companies in light of the
rapidly-changing competitive environment of the technology services industry. An
objective of these strategic reviews is to identify alternative strategies to
enhance stockholder value.

In October 1999, Eltrax's board of directors made a strategic decision to
position Eltrax to better take advantage of key trends in the information
technology marketplace, including specifically the emergence of the ASP market,
continued growth of network services management and increased emphasis by
organizations on customer care. Given these trends, the board believed that
focusing Eltrax's product development and marketing resources on promoting and
growing its technology services group, especially the ASP division, was in the
best interests of Eltrax's stockholders. As part of this focus on the technology
services group, in October 1999 Eltrax engaged a nationally-recognized
investment banking firm to review Eltrax's current business strategy and explore
various financing and restructuring alternatives that would further the goal of
promoting and growing its technology services group, especially the ASP
division.

In March 2000, after consulting its financial advisors regarding the
strategic direction of Eltrax's business, the Eltrax board of directors decided
to explore the sale of all or a portion of Eltrax's hospitality services group.

On April 17, 2000, William P. O'Reilly, Chairman, President and Chief
Executive Officer of Eltrax, met with Steven A. Odom, Chairman and Chief
Executive Officer of Cereus, to discuss a possible merger of the two companies.
Mr. O'Reilly was a former member of the board of directors of World Access,
Inc., a company of which Mr. Odom had been Chairman and Chief Executive Officer.
Mr. O'Reilly believed the combination of Mr. Odom's management skills and
Cereus's e-procurement and Web hosting capabilities made Cereus an attractive
merger partner. The discussion was very general in nature, covering the benefits
of a possible combination. There was no discussion of merger terms.

On April 25, 2000, Mr. O'Reilly met with Mr. Odom, Juliet M. Reising,
Cereus's Chief Financial Officer, and James M. Longdon, Cereus's President and
Chief Executive Officer, to discuss a possible combination of the two companies.
This meeting included a discussion about strategic direction and management and
financial issues relating to a possible combination. The parties did not discuss
specific terms of a combination.

On May 5, 2000, the same parties met to discuss, in more detail, a possible
merger of the two companies. There was extensive discussion about the
combination of the businesses, as well as the structure of a proposed management
team and board of directors. There was no discussion of an exchange ratio.

From May 8 to May 24, 2000, the same parties had several discussions
regarding transaction structure. These discussions included legal counsel for
both parties. In formulating a transaction structure, the parties considered the
following factors:

- public equity market perception of the structure;

- Nasdaq listing issues;

- the companies' states of incorporation;

- state law issues affecting the merger;

- required lender consents;

- accounting issues; and

- the impact on existing equity incentive plans and other employee benefit
plans.

The parties also discussed Eltrax's short-term cash needs and the possibility of
Cereus making an investment in Eltrax prior to or coincident with the execution
of a definitive transaction agreement.
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<PAGE> 33

During the same period, the parties had several general discussions
regarding the appropriate exchange ratio. Beginning May 25, 2000, the
discussions focused on more specific exchange ratios. Over the week of May 29,
2000, the parties discussed various exchange ratio proposals, which ranged
between 1.47 and 1.87 shares of Eltrax common stock for each share of Cereus
common stock.

On May 26, 2000, Eltrax engaged Morgan, Keegan & Company, Inc. to act as
its financial advisor in connection with the proposed merger with Cereus. Mr.
O'Reilly had several discussions with representatives of Morgan Keegan during
the week of May 29, 2000 concerning possible exchange ratios and the potential
for the combined company.

On June 2, 2000, Messrs. O'Reilly and Odom agreed to recommend to their
respective boards of directors an exchange ratio of 1.667 shares of Eltrax
common stock for each share of Cereus common stock, to be adjusted by a formula
based on the sale of any part of Eltrax's hospitality services group. In
addition, Messrs. O'Reilly and Odom agreed on the principal terms of a $5
million senior subordinated convertible debt investment by Cereus in Eltrax
coincident with the execution of the merger agreement.

On June 5, 2000, Mr. O'Reilly sent a letter and merger term sheet to the
members of the Eltrax board of directors discussing in detail the terms of the
proposed merger of the two companies and the convertible debt investment. During
the week of June 5, 2000, Mr. O'Reilly had several discussions with members of
the Eltrax board of directors concerning the reasons for and terms of the
proposed transaction.

On June 12, 2000, the boards of directors of both companies met to consider
the final terms of the transaction. At the Cereus board meeting, presentations
were made by Robinson-Humphrey and Cereus's legal advisors, including, but not
limited to, summaries of financial and valuation analyses presented on
historical, projected and pro-forma bases, Robinson-Humphrey's written fairness
opinion on the exchange ratio, regulatory matters, tax matters and the due
diligence review of Cereus's advisors. Rogers & Hardin, counsel to Cereus,
discussed with the board an analysis of the legal and regulatory aspects of the
proposed transaction, reviewed the fiduciary obligations of the Cereus directors
and described the terms of the merger agreement and related documents. The
directors discussed their views of the presentations and the transaction. After
extensive discussion, the board unanimously approved the merger agreement and
convertible debt investment and authorized its officers to execute and deliver
the merger agreement to Eltrax.

At the Eltrax board meeting, presentations were made by Morgan Keegan and
Eltrax's legal advisors, including, but not limited to, summaries of financial
and valuation analyses presented on historical, projected and pro-forma bases,
Morgan Keegan's written fairness opinion on the merger consideration, regulatory
matters, tax matters and the due diligence review of Eltrax's advisors. Jaffe,
Raitt, Heuer & Weiss, counsel to Eltrax, discussed with the board an analysis of
the legal and regulatory aspects of the proposed transaction, reviewed the
fiduciary obligations of the Eltrax directors and described the terms of the
merger agreement and related documents. The directors discussed their views of
the presentations and the transaction. After extensive discussion, the board
unanimously approved the merger agreement and convertible debt investment and
authorized the officers to execute and deliver the merger agreement and
convertible loan facility and note to Cereus.

The parties executed the merger agreement after the close of business on
June 12, 2000 and announced the transaction before the open of business on June
13, 2000.

In June, to address a shortage of available working capital, Eltrax began
to implement certain cost reduction initiatives, including the elimination of
approximately 100 positions held by employees as well as most positions held by
contract professionals.

In a further effort to meet Eltrax's continuing short-term capital needs,
beginning in July, Eltrax and Cereus began to discuss an increase in the amount
of the bridge facility. During this period the parties and their legal and
financial advisors had several discussions regarding various matters, including
electing Messrs. Odom and Logsdon and Ms. Reising as officers of Eltrax, the
proposed increase in the amount available under the bridge facility and an
adjustment to the merger exchange ratio.

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<PAGE> 34

On July 26, 2000, management of Eltrax and Cereus agreed in principle on
certain amendments to the merger agreement and, Eltrax management agreed to
recommend to the Eltrax board the election of Messrs. Odom and Logsdon and Ms.
Reising as officers of Eltrax. Under the proposed amendment to the merger
agreement, (i) upon the satisfaction of certain conditions relating to Eltrax's
credit facility with PNC Bank, Cereus would agree to loan Eltrax an additional
$5 million under the bridge facility (for total borrowings of $10 million from
Cereus under the facility) prior to the merger closing; (ii) the exchange ratio
would be changed to 1.75 shares of Eltrax common stock for each share of Cereus
common stock, provided that if Cereus does not amend the existing bridge
facility to loan Eltrax an additional $5.0 million before September 1, 2000,
which date may be extended to September 18, 2000 under certain circumstances,
the exchange ratio would be adjusted to 1.667 shares of Eltrax common stock for
each share of Cereus common stock, subject to further downward adjustment based
on the sale of all or part of Eltrax's hospitality services group; (iii) if the
conditions to the funding of the additional amount under the bridge facility are
satisfied but Cereus does not fund the additional amount, Eltrax could terminate
the agreement; (iv) a provision requiring the parties to raise $20.0 million in
cash from the sale of equity, convertible debt and certain assets would be
deleted; (v) a provision requiring Cereus to have $15.0 million in cash at the
closing of the merger would be deleted; (vi) the requirement that holders of no
more than a certain number of shares of Cereus common stock seek appraisal
rights would be changed from a mutual closing condition to a condition to
Cereus's obligation to close the merger, and (vii) certain other non-material
changes would be made to the agreement.

On July 27, 2000, the boards of directors of both companies met to consider
the terms of the proposed amendments to the merger agreement.

At the Cereus board meeting, a presentation was made by Robinson-Humphrey
regarding the fairness to Cereus's stockholders from a financial point of view
of the terms of the proposed amendments, including the new exchange ratio. At
the board meeting, Robinson-Humphrey delivered its oral opinion, subsequently
confirmed in writing, that the new exchange ratio is fair from a financial point
of view to the common stockholders of Cereus. The directors discussed their
views of the presentations and the terms of the proposed amendments to the
merger agreement. After extensive discussion, the board unanimously approved the
amendment to the merger agreement and authorized its officers to execute and
deliver to Eltrax an amended and restated merger agreement.

At the Eltrax board meeting, a presentation was made by Morgan Keegan
regarding the fairness to Eltrax's stockholders from a financial point of view
of the terms of the proposed amendments, including the new adjustable exchange
ratio. Morgan Keegan indicated at the board meeting that, upon further review
and analysis, it expected to be able to issue a fairness opinion as to the
amended and restated merger agreement to the Eltrax board within a few days of
the meeting. The directors discussed their views of the presentations and the
terms of the proposed amendments to the merger agreement and the election of
Messrs. Odom and Logsdon and Ms. Reising as officers of Eltrax. After extensive
discussion, the board unanimously approved the amended and restated merger
agreement and authorized its officers to execute and deliver to Cereus an
amended and restated merger agreement and elected Messrs. Odom and Logsdon and
Ms. Reising as officers of Eltrax, effective September 1, 2000.

The parties executed the second amended and restated merger agreement on
July 27, 2000. The second amended and restated merger agreement is set forth as
Appendix A to this document. Unless the context indicates otherwise, all
references in this document to the "merger agreement" are to the second amended
and restated merger agreement.

REASONS FOR THE MERGER

Cereus's Reasons for the Merger

The Cereus board of directors unanimously approved the merger agreement.
The Cereus board believes that increasing competition and industry consolidation
make it increasingly important for Cereus to grow and gain critical mass quickly
in order to compete with larger companies with substantially greater resources
and broader, integrated product offerings, particularly customer care services.
Cereus's
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<PAGE> 35

management has considered a number of alternatives to enhance its competitive
position in the industry environment referred to above. Given that environment
and the board's desire to achieve critical mass quickly, the board identified
several potential benefits for the Cereus stockholders, employees and customers
that it believes would result from the merger with Eltrax. These potential
benefits include:

- the ability to quickly achieve the critical mass necessary to compete in
Cereus's industry sector;

- the ability to gain access to Eltrax's state of the art, fully-developed
technology services group that provides comprehensive outsourced
technology solutions and customer care solutions;

- the enhanced potential for earnings and revenue growth as a result of
combining the two companies' complementary core competencies;

- the competitive, financial and operational benefits of increased scale,
including increased financial strength and increased ability to attract
high quality personnel;

- the greater financial flexibility and more favorable access to capital
enjoyed by larger companies;

- the ability to provide Cereus stockholders with enhanced liquidity;

- potential cost savings through the consolidation of facilities and
elimination of duplicative costs;

- the ability to provide Cereus stockholders with shares of Eltrax common
stock in a tax-free exchange; and

While Cereus expects to realize these benefits, there can be no assurance
that Cereus will actually be able to do so.

Eltrax's Reasons for the Merger

The Eltrax board of directors unanimously approved the merger proposal. The
decision by Eltrax's board was based on several potential benefits of the merger
that it believes will contribute to the future success of the combined company.
These potential benefits include:

- deepening Eltrax's technology expertise by gaining access to Cereus's
highly-qualified group of Web developers and other technology
professionals;

- expediting Eltrax's goal of becoming a major force in the ASP
marketplace;

- the enhanced potential for earnings and revenue growth as a result of
combining the two companies' complementary core competencies;

- increasing Eltrax's access to capital;

- potential cost savings through the consolidation of facilities and
elimination of duplicative costs; and

- leveraging the combined company's strengths to access the capital needed
to grow effectively.

While Eltrax expects to realize these benefits, there can be no assurance
that Eltrax will actually be able to do so.

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<PAGE> 36

FACTORS CONSIDERED BY THE BOARDS OF DIRECTORS

Each of our boards of directors, in reaching its decision on the merger,
also considered a number of other factors, including:

- the potential benefits to be derived from a combination of the two
companies described under "-- Reasons for the Merger";

- the strategic and financial alternatives available to each company;

- the terms of the merger agreement;

- the current and prospective economic and competitive environment facing
each company;

- the opinions of our respective financial advisors that, as of the date of
their respective opinions, and subject to the assumptions and limitations
set forth in the opinions, the exchange ratio was fair from a financial
point of view to our respective stockholders, and the financial
presentations made by our financial advisors to our respective boards of
directors in connection with the delivery of their opinions;

- the likely impact of the merger on each company's employees and
customers;

- the interests of officers and directors of each company in the merger, as
described under "-- Interests of Directors and Officers in the Merger";

- our respective obligations to pay termination fees under the
circumstances described in the merger agreement and the impact that the
termination fees may have on potential third-party acquirers;

- the qualification of the merger as a tax-free transaction for federal
income tax purposes (except for tax resulting from any cash received for
fractional shares by the holders of Cereus common stock);

- our review, based in part on presentations by our respective financial
advisors and the due diligence review of each other, of the financial
condition, results of operations, businesses and prospects of each of the
companies before and after giving effect to the merger and the
determination of the merger effect on stockholder value; and

- the current market conditions for technology stocks, historical market
prices of Cereus and Eltrax common stock, price volatility and trading
information.

The Cereus board of directors also considered a variety of risks and
potentially negative factors in its deliberations concerning the merger,
including:

- the irreversible nature of the merger;

- the potential disruption of Cereus's business that might result from the
announcement of the merger;

- the risk that anticipated benefits of the merger for Cereus stockholders
may not be realized as a result of potential difficulties in integrating
the operations, management and corporate cultures of Cereus and Eltrax;

- the significant costs involved in consummating the merger;

- the risk of diverting management focus and resources from other strategic
opportunities and from operational matters while working to implement the
merger;

- the risk that the merger would not be consummated and that, under some
circumstances, Cereus could be required to pay a termination fee to
Eltrax;

- the risk that if the merger was not completed, Eltrax would not be able
to repay all or part of the bridge facility; and

- the other risks described in this document under "Risk Factors."
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<PAGE> 37

The Cereus board of directors did not believe that the negative factors were
sufficient, individually or in the aggregate, to outweigh the potential
advantages of the merger.

The Eltrax board also identified and considered a number of potentially
negative factors in its deliberations concerning the merger, including:

- the risk that the potential benefits and synergies of the merger may not
be realized;

- the possibility that the merger may not be consummated, even if approved
by Eltrax's and Cereus's stockholders;

- the risk that another company might make a more favorable offer for
Cereus, potentially increasing the price paid by Eltrax if Eltrax was
ultimately successful in its bid to acquire Cereus or otherwise causing
Eltrax to expend resources in pursuing the merger, especially given the
delay between the execution of the merger agreement and the completion of
the merger;

- the possibility that Cereus management would not choose to remain
employed by the combined company;

- the short operating history of Cereus as an information technology
business;

- the risk of management and employee disruption associated with merging
two organizations, including the risk that despite the efforts of the
combined company, key technical, sales and management personnel might not
remain employed by the combined company, especially given the competition
for quality personnel in the industry; and

- the other risks described in this document under "Risk Factors."

The Eltrax board of directors did not believe that the negative factors were
sufficient, individually or in the aggregate, to outweigh the potential
advantages of the merger.

This discussion of the information and factors considered by our boards of
directors is not intended to be exhaustive. In view of the wide variety of the
material factors considered in connection with their respective evaluations of
the merger and the complexity of these matters, our boards of directors did not
find it practicable to, and did not, quantify or otherwise attempt to assign any
relative weight to the various factors considered. In addition, our boards of
directors did not undertake to make any specific determination as to whether any
particular factor, or any aspect of any particular factor, was favorable or
unfavorable to their ultimate determination, but rather each board conducted an
overall analysis of the factors described above, including discussions with and
questioning of its management and legal and financial advisors. In considering
the factors described above, individual members of our boards of directors may
have given different weight to different factors.

There can be no assurance that any of the potential savings, synergies or
opportunities considered by our boards of directors or an increase in
stockholder value actually will be achieved through consummation of the merger.
See "Risk Factors."

RECOMMENDATIONS OF THE ELTRAX AND CEREUS BOARDS OF DIRECTORS

Eltrax

ELTRAX'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE HOLDERS OF
ELTRAX COMMON STOCK VOTE "FOR" APPROVAL OF THE ELTRAX MERGER PROPOSAL.

Cereus

CEREUS'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE HOLDERS OF
CEREUS COMMON STOCK VOTE "FOR" APPROVAL OF THE MERGER AGREEMENT.

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<PAGE> 38

OPINION OF ELTRAX'S FINANCIAL ADVISOR

Eltrax engaged Morgan Keegan & Company, Inc. as its exclusive financial
advisor in connection with the merger. Morgan Keegan was selected on the basis
of its qualifications, experience and reputation as well as its knowledge of the
business and affairs of Eltrax. In connection with its engagement, Morgan Keegan
was instructed by Eltrax to evaluate the fairness, from a financial point of
view, to the holders of Eltrax common stock, of the consideration to be paid by
Eltrax pursuant to the merger agreement and, in such regard, to conduct such
investigations as Morgan Keegan deemed appropriate for such purpose. No
limitations were placed by Eltrax with respect to the investigations made or the
procedures followed by Morgan Keegan in rendering its opinion, and Eltrax and
its management cooperated fully with Morgan Keegan in connection therewith.

In connection with the Eltrax's board's approval of the original merger
agreement on June 12, 2000, Morgan Keegan rendered both an oral and written
opinion to the Eltrax board of directors to the effect that, based upon and
subject to certain matters stated therein, as of the date of such opinion, the
consideration to be paid by Eltrax pursuant to the original merger agreement was
fair to Eltrax from a financial point of view. On July 27, 2000, representatives
of Morgan Keegan indicated at a meeting of the Eltrax board of directors that,
upon further review and analysis, they expected Morgan Keegan to be able to
issue to the Eltrax board of directors a fairness opinion regarding the
consideration to be paid by Eltrax pursuant to the second amended and restated
merger agreement within a few days of the meeting. On August 4, 2000, Morgan
Keegan rendered its second written opinion to the Eltrax board of directors to
the effect that, based upon and subject to certain matters stated therein, as of
the date of such opinion, the consideration to be paid by Eltrax pursuant to the
second amended and restated merger agreement is fair to Eltrax from a financial
point of view. The full text of the written opinion of Morgan Keegan, which sets
forth, among other things, assumptions made, procedures followed, matters
considered, and limitations on the review undertaken by Morgan Keegan in
rendering its opinion, is attached as Appendix B to this document. All
references to the merger agreement in this discussion and in the opinion refer
to the second amended and restated merger agreement dated July 27, 2000. ELTRAX
STOCKHOLDERS ARE URGED TO, AND SHOULD, READ THE WRITTEN OPINION OF MORGAN KEEGAN
CAREFULLY AND IN ITS ENTIRETY.

Morgan Keegan's opinion was provided to the Eltrax board of directors and
is directed only to the fairness of the consideration to be paid by Eltrax
pursuant to the merger agreement from a financial point of view to Eltrax's
common stockholders as of the date of the opinion and does not address any other
aspect of the merger. Morgan Keegan's opinion does not constitute a
recommendation to any of the holders of Eltrax or Cereus common stock as to
whether to vote to adopt the merger agreement. The summary of the written
opinion of Morgan Keegan set forth herein is qualified in its entirety by
reference to the full text of the opinion.

In conducting its analysis and rendering its opinion, Morgan Keegan
reviewed and considered such financial and other factors it deemed appropriate
under the circumstances, including, among others, the following:

- certain publicly available financial statements and other information of
Eltrax and Cereus;

- certain internal financial statements and other financial and operating
data concerning Eltrax and Cereus prepared by the management of Eltrax
and Cereus, respectively;

- the past and current operations and financial condition and the prospects
of Eltrax, including information relating to certain strategic, financial
and operational benefits anticipated from the merger, with senior
executives of Eltrax;

- certain financial forecasts prepared by the management of Eltrax;

- the past and current operations and financial condition and the prospects
of Cereus, including information relating to certain strategic, financial
and operational benefits anticipated from the merger, with senior
executives of Cereus;

- certain financial forecasts prepared by the management of Cereus;

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<PAGE> 39

- the pro forma impact of the merger on the operating and financial results
of Eltrax;

- the reported prices and trading activity for Eltrax common stock and
Cereus common stock;

- its discussion with the senior management of Eltrax and Cereus of the
strategic rationale for the merger;

- a comparison of the financial performance of Eltrax and Cereus and the
prices and trading activity of Eltrax common stock and Cereus common
stock with that of certain other publicly-traded companies and their
securities;

- the financial terms, to the extent publicly available, of certain other
business combinations and other transactions that Morgan Keegan deemed
relevant;

- the draft of the merger agreement and certain related documents; and

- such other analyses performed by it and such other factors as Morgan
Keegan deemed appropriate.

Morgan Keegan did not assume any responsibility to independently verify the
information referred to above, and in rendering its opinion, Morgan Keegan, with
the consent of the Eltrax board of directors, assumed and relied upon, without
independent verification, the accuracy and completeness of the information
reviewed by it for the purposes of its opinion. With respect to the financial
forecasts, including the information relating to certain strategic, financial
and operational benefits anticipated from the merger, Morgan Keegan assumed that
they were reasonably prepared on the bases reflecting the best currently
available estimates and judgments of the prospects of Eltrax and Cereus. Morgan
Keegan assumed that the merger will be consummated in accordance with the terms
set forth in the merger agreement, including, among other things, that the
merger will be treated as a tax-free reorganization and/or exchange under the
Internal Revenue Code. Morgan Keegan did not request and was not requested to
make any independent valuation of the assets or liabilities of Eltrax or Cereus,
nor was it furnished with any such appraisals. With the consent of the Eltrax
board of directors, Morgan Keegan also relied upon, without any independent
verification, an assessment of the validity of, and the risks associated with,
Cereus's products, services and technology by the management of Eltrax. Morgan
Keegan's opinion is necessarily based on financial, economic, market and other
conditions as in effect on, and the information made available to it as of
August 2, 2000.

Analyses By Morgan Keegan

The following is a brief summary of the material financial analyses
performed by Morgan Keegan in connection with its August 4, 2000 opinion. These
summaries include information presented in tabular format. In order to fully
understand the financial analyses used by Morgan Keegan, the tables must be read
together with the text of each summary. The tables alone do not constitute a
complete description of the financial analyses and considering the tables
without consulting the full narrative description could create an incomplete
view of Morgan Keegan's analyses.

Historical Stock Price Analysis. Morgan Keegan reviewed the stock price
performance of Eltrax and Cereus and compared such performance with that of a
group of companies. The first group (which we refer to collectively as the
"Enterprise Application Service Provider Index") included:

- Breakaway Solutions, Inc.;
- Brightstar Information Technology Group, Inc.;
- ebaseOne Corporation;
- FutureLink Corp.;
- Interliant, Inc.;
- NaviSite, Inc.; and
- USinternetworking, Inc.

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<PAGE> 40

The second group (which we refer to collectively as the "Internet Enabler
Index") included:

- AnswerThink Consulting Group, Inc.;
- AppNet, Inc.;
- Braun Consulting, Inc.;
- C-Bridge Internet Solutions, Inc.;
- Cysive, Inc.;
- iXL Enterprises, Inc.;
- Proxicom, Inc.;
- Razorfish, Inc.;
- Sapient Corporation;
- Scient Corporation; and
- Viant Corporation.

The third group (which we refer to collectively as the "Information
Technology Consulting and Services Index") included:

- American Management Systems, Inc.;
- CACI International, Inc.;
- Cambridge Technology Partners, Inc.;
- CIBER, Inc.;
- Keane, Inc.;
- Renaissance Worldwide, Inc.;
- Tanning Technology Corporation;
- Technology Solutions Company; and
- Tier Technologies, Inc.

Morgan Keegan noted that none of the companies selected has the same
management, composition, size or combination of businesses as Eltrax or Cereus.
Because none of these companies is identical to Eltrax or Cereus, Morgan Keegan
considered the data for the composite peer groups to be more relevant than the
data for any single company. Morgan Keegan observed that over the period from
July 1, 1999 to June 9, 2000 the market price of Eltrax common stock and Cereus
common stock increased 85.8% and 197.3%, respectively. During the same time
period, Morgan Keegan also observed that the Enterprise Application Service
Provider Index increased 82.7%, the Internet Enablers Index increased 115.7% and
the Information Technology Consulting and Services Index decreased 18.5%. June
9, 2000 is the last trading date prior to the date the original merger agreement
was executed. The transaction was announced to the public before the open of
business on June 13, 2000.

Historical Exchange Ratio Analysis. Morgan Keegan compared the historical
ratios of the average closing price of Cereus common stock to the average
closing price of Eltrax common stock over various periods ended June 9, 2000.
The following table sets forth the ratios of the average closing prices of
Cereus common stock compared to Eltrax common stock for the various periods
ended June 9, 2000:

<TABLE>
<CAPTION>
AVERAGE MARKET PERCENTAGE PREMIUM/(DISCOUNT) REPRESENTED
EXCHANGE BY MERGER EXCHANGE RATIO OVER
PERIOD ENDED JUNE 9, 2000 RATIO OVER PERIOD HISTORICAL EXCHANGE RATIO
------------------------- ----------------- -----------------------------------------
<S> <C> <C>
One trading day.................... 1.7188x 1.8%
Last 10 trading days............... 2.1690 (19.3)
Last 30 trading days............... 2.3773 (36.4)
Last 60 trading days............... 1.7830 (1.9)
Last 90 trading days............... 1.5461 13.2
Last 180 trading days.............. 1.3354 31.2
Since July 1, 1999................. 1.3417 30.1
</TABLE>

Morgan Keegan noted that the transaction exchange ratio was lower than the
average market exchange ratio for all time periods analyzed over the last 60
trading days prior to June 9, 2000.

33
<PAGE> 41

Peer Group Analysis. Morgan Keegan compared certain financial information
of Eltrax and Cereus with publicly available information for the companies
comprising the Enterprise Application Service Provider Index, Internet Enablers
Index and the Information Technology Consulting and Services Index. As financial
results for the hospitality service assets (as defined in the merger agreement)
are planned to be reported as discontinued operations in anticipation of that
segment's sale or other disposition, such financial results were segregated from
the remainder of the Eltrax business and not used in the valuation of its
ongoing operations. Based on a letter of intent and other indications of
interest received by Eltrax and provided to Morgan Keegan for certain
hospitality service assets, a valuation range of $10 million to $25 million was
assigned to this segment of Eltrax's business. Management believes that any
hospitality service assets excluded from the ultimate sale or sales of the
hospitality service business segment will have no value.

The information analyzed by Morgan Keegan included, among other things, the
multiples of adjusted market value, defined as market capitalization plus total
debt less cash and cash equivalents, to revenues for the 12 months ended June
30, 2000, estimated revenues for calendar years 2000 and 2001 as prepared by
securities research analysts, and estimated average billable consultants for
calendar year 2000 as prepared by securities research analysts.

Based on estimates from securities research analysts and closing stock
prices as of July 31, 2000, Morgan Keegan derived the following composite peer
group multiples:

<TABLE>
<CAPTION>
MEDIAN MULTIPLE OF ADJUSTED MARKET VALUE TO
----------------------------------------------------------------
REVENUES FOR
THE LATEST BILLABLE
TWELVE PROJECTED CALENDAR YEAR CONSULTANTS
PEER GROUP MONTHS 2000 REVENUES 2001 REVENUES (IN THOUSANDS)(1)
---------- ------------ ------------- ------------- -----------------
<S> <C> <C> <C> <C>
Enterprise Application Service
Providers.................... 11.7x 15.4x 8.9x N/A
Internet Enablers.............. 9.6 7.8 5.1 $2,130.9
Information Technology
Consulting and Services
Providers.................... 1.0 1.0 0.8 205.5
</TABLE>

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

(1) Based on estimated average billable consultants for calendar year 2000.

Applying the multiples for the composite of each peer group to the revenues
for the 12 months ended June 30, 2000 and estimated revenues of Eltrax and
Cereus, Morgan Keegan derived the implied equity value per share for Eltrax and
Cereus, respectively, and the implied exchange ratio:

<TABLE>
<S> <C>
Implied Eltrax Value Per Share.............................. $ 2.35 -- $ 4.82
Implied Cereus Value Per Share.............................. $10.13 -- $14.70
Implied Exchange Ratio...................................... 3.050x -- 4.311x
</TABLE>

In evaluating the peer groups, Morgan Keegan made judgments and assumptions
with regard to industry performance, general business, economic, market and
financial conditions and other matters, many of which are beyond the control of
Eltrax and Cereus, such as the impact of competition on the businesses of Eltrax
and Cereus, and the industry generally, industry growth, and the absence of any
adverse material change in the financial condition and prospects of Eltrax,
Cereus or the industry or in the financial markets in general. Mathematical
analysis, such as determining the average or median, is not in itself a
meaningful method of using peer group data.

Analysis of Selected Precedent Transactions. Morgan Keegan reviewed the
publicly available financial terms of the following precedent transactions in
the enterprise application service provider, Internet enabler and information
technology and consulting services industries:

- the acquisition of VSI Technology Solutions, Inc. by FutureLink
Corporation;

- the acquisition of Emerging Technologies Consultants, Inc. by Braun
Consulting, Inc.;
34
<PAGE> 42

- the acquisition of Executive LAN Management, Inc. by FutureLink
Corporation;

- the acquisition of Clarity IBD Ltd. by Proxicom, Inc.;

- the acquisition of Conduit Communications Ltd. by i-Cube, Inc.;

- the acquisition of Adjacency, Inc. by Sapient Corporation;

- the acquisition of Eggrock Partners, Inc. by Breakaway Solutions, Inc.;

- the acquisition of USWeb/CKS Corp. by Whittman-Hart, Inc.;

- the acquisition of Tessera Enterprise Systems by iXL Enterprises, Inc.;
and

- the acquisition of i-Cube, Inc. by Razorfish, Inc.

Morgan Keegan compared the publicly available statistics for the precedent
transactions listed above to the relevant financial statistics for the merger
based on the exchange ratio. Multiples compared by Morgan Keegan included, among
other things, the adjusted market value as of the date of the transaction to
revenues from the last 12 months preceding the announcement of the transaction,
billable consultants at the time of the announcement of the transaction,
estimated revenues for the current fiscal year as prepared by securities
research analysts at the time of the announcement of the transaction and
estimated revenues for the next fiscal year as prepared by securities research
analysts at the time of the announcement of the transaction. Applying the range
of multiples derived from the multiples of the precedent transactions to the
aforementioned metrics, Morgan Keegan derived the implied equity value per share
for Eltrax and Cereus and the implied exchange ratio as follows:

<TABLE>
<S> <C>
Implied Eltrax Value Per Share.............................. $3.29 -- $ 8.71
Implied Cereus Value Per Share.............................. $7.79 -- $10.59
Implied Exchange Ratio...................................... 1.215 -- 2.356
</TABLE>

None of the transactions utilized in the selected precedent transactions
analysis for comparative purposes was deemed to be identical to the merger
contemplated by Eltrax and Cereus. Accordingly, an analysis of the results of
the foregoing is not mathematical and necessarily involves complex
considerations and judgments concerning differences in financial and operating
characteristics of the companies, including differences in pre-transaction
operating performance, intangible or other assets associated with a target's
business and not reflected in historical financial performance and/or other
transaction specific factors, such as the strategic nature of particular
transactions. Mathematical analysis, such as determining the average or median,
is not in itself a meaningful method of using comparable transaction data.

Pro Forma Valuation of Combined Company Analysis. Morgan Keegan analyzed
the pro forma impact of the merger on the combined company's estimated revenues
for calendar year 2001. Morgan Keegan applied the range of multiples set forth
in the peer group analysis, as described above, to the pro forma estimated
revenues for calendar year 2001 to derive an implied combined company equity
value per share and the resulting accretion or dilution to Eltrax's current
stockholders based on Eltrax's closing price of $4.375 as of August 2, 2000.
Based on this analysis, Morgan Keegan observed that the merger would result in
significant equity value per share accretion for Eltrax stockholders, before
taking into account any one-time charges or synergies.

Pro Forma Earnings Impact Analysis. Morgan Keegan analyzed certain pro
forma effects of the merger, including, among other things, the impact of the
merger on the estimated cash earnings per share, defined as net income per share
plus goodwill amortization per share, on the estimated earnings for

35
<PAGE> 43

calendar years 2000 and 2001 prepared by company management. The following table
sets forth the resulting accretion to the combined company's earnings per share
before goodwill amortization ("Cash Earnings") for calendar year 2000 and
calendar year 2001 based on such estimates:

<TABLE>
<CAPTION>
CASH EARNINGS PER SHARE ESTIMATE ACCRETION
-------------------------------- ---------
<S> <C>
Calendar Year 2000.......................................... 31.0%
Calendar Year 2001.......................................... 61.5%
</TABLE>

Premium Analysis. Morgan Keegan reviewed publicly available information
concerning premiums paid in two categories of acquisition transactions and
derived an implied price per share based on the median premiums paid in these
transactions. The first category included 30 technology industry transactions
with total consideration between $50 million and $250 million and completed
since January 1, 1999. The second category included 41 transactions in various
industries, excluding financial institutions, with total consideration between
$50 million and $250 million in which the form of consideration was common stock
and completed since January 1, 1999. Morgan Keegan then calculated the median
premiums represented by the offer price in those transactions over the market
price of the securities four weeks, one week and one day before June 9, 2000.
The following table presents the median offer price premiums for the
aforementioned respective periods for the technology industry transactions,
compared to the respective offer price for the merger as of June 9, 2000:

<TABLE>
<CAPTION>
IMPLIED EXCHANGE RATIO
PREMIUM/ (DISCOUNT) BASED UPON MEDIAN PREMIUM BASED ON MEDIAN PREMIUM(1)
------------------------------ -------------- --------------------------
<S> <C> <C>
June 9, 2000.................................. 28.7% 2.211x
1 Week Prior to June 9, 2000.................. 40.1 2.276x
1 Month Prior to June 9, 2000................. 57.4 2.680x
</TABLE>

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

(1) Based on the $8.00 Eltrax closing price as of June 9, 2000 and the following
closing prices for Cereus common stock:

<TABLE>
<S> <C>
June 9, 2000................................................ $13.75
1 Week Prior to June 9, 2000................................ 13.00
1 Month Prior to June 9, 2000............................... 13.63
</TABLE>

The following table presents the median offer price premiums for the
aforementioned respective periods for the transactions in which the form of
consideration was common stock, compared to the respective offer price for the
merger as of June 9, 2000:

<TABLE>
<CAPTION>
IMPLIED EXCHANGE RATIO
PREMIUM/ (DISCOUNT) BASED UPON MEDIAN PREMIUM BASED ON MEDIAN PREMIUM(1)
------------------------------ -------------- --------------------------
<S> <C> <C>
June 9, 2000.................................. 31.5% 2.260x
1 Week Prior to June 9, 2000.................. 39.6 1.019x
1 Month Prior to June 9, 2000................. 58.4 2.698x
</TABLE>

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

(1) Based on the $8.00 Eltrax closing price as of that date, and the following
closing prices for Cereus common stock:

No transaction utilized as a comparison in the premium analysis is
identical to the merger. In evaluating the two categories of transactions set
forth above, Morgan Keegan made judgments and assumptions with regard to
industry performance, general business, economic, market and financial
conditions and other matters, many of which are beyond the control of Eltrax and
Cereus, such as the impact of competition on the businesses of Eltrax and Cereus
and the industry generally, industry growth and the absence of any adverse
material change in the financial condition of Eltrax, Cereus or the industry

36
<PAGE> 44

or in the financial markets in general. Mathematical analysis, such as
determining the average or median, is not in itself a meaningful method of using
comparable transaction data.

The preparation of a fairness opinion is a complex process and is not
necessarily susceptible to partial analysis or summary description. In arriving
at its opinion, Morgan Keegan considered the results of all of its analyses as a
whole and did not attribute any particular weight to any analysis or factor
considered by it. Furthermore, Morgan Keegan believes that selecting any portion
of its analyses, without considering all analyses, would create an incomplete
view of the process underlying its opinion. In addition, Morgan Keegan may have
given various analyses and factors more or less weight than other analyses and
factors, and may have deemed various assumptions more or less probable than
other assumptions, so that the ranges of valuations resulting from any
particular analysis described above should not be taken to be Morgan Keegan's
view of the actual value of Eltrax or Cereus. In performing its analyses, Morgan
Keegan made numerous assumptions with respect to industry performance, general
business and economic conditions and other matters, many of which are beyond the
control of Eltrax and Cereus. Any estimates contained in Morgan Keegan's
analyses are not necessarily indicative of future results or actual values,
which may be significantly more or less favorable than those suggested by such
estimates.

The analyses performed were prepared solely as part of Morgan Keegan's
analysis of the fairness of consideration to be paid by Eltrax in the merger,
from a financial point of view, to the holders of Eltrax common stock as of the
date of the opinion and were conducted in connection with the delivery of the
Morgan Keegan opinion. The analyses do not purport to be appraisals or to
reflect the prices at which Eltrax common stock or Cereus common stock might
actually trade. Because such analyses are inherently subject to uncertainty none
of Eltrax, Cereus, Morgan Keegan or any other person assumes responsibility if
future results are materially different from those forecast.

Morgan Keegan is a nationally recognized investment banking and advisory
firm. Morgan Keegan, as part of its investment banking business, is continuously
engaged in the valuation of businesses and securities in connection with mergers
and acquisitions, negotiated underwritings, competitive biddings, secondary
distributions of listed and unlisted securities and private placements. In the
past, Morgan Keegan and its affiliates have provided financing and advisory
services to Eltrax and have received customary fees for the rendering of these
services. In the ordinary course of Morgan Keegan's trading and brokerage
activities, Morgan Keegan or its affiliates may at any time hold long or short
positions, may trade or otherwise effect transactions, for its own account or
for the account of customers in the equity securities of Eltrax and Cereus.

Eltrax has agreed to pay Morgan Keegan a fee of $325,000 for its services
rendered in providing its fairness opinion. Eltrax has also agreed to reimburse
Morgan Keegan for its expenses incurred in performing its services. In addition,
Eltrax has also agreed to indemnify Morgan Keegan and its affiliates, their
respective directors, officers, agents and employees and each person, if any,
controlling Morgan Keegan or any of its affiliates against certain liabilities
and expenses, including certain liabilities under the federal securities laws,
related to or arising out of Morgan Keegan's engagement.

OPINION OF CEREUS'S FINANCIAL ADVISOR

General

The Robinson-Humphrey Company, LLC, was retained by Cereus to deliver its
opinion as to the fairness, from a financial point of view, to the common
stockholders of Cereus of the merger exchange ratio pursuant to the proposed
transaction. On June 12, 2000, at a meeting of the Cereus board of directors
held to evaluate and approve the merger agreement, and on July 27, 2000, at a
meeting of the Cereus board of directors held to evaluate and approve the
proposal amendments to the merger agreement, Robinson-Humphrey rendered an
opinion, which was an oral opinion subsequently confirmed in writing with
respect to the July 27, 2000 meeting, to the Cereus board of directors to the
effect that, as of the date of such opinion and based upon and subject to
certain matters stated therein, the merger exchange ratio in the proposed
transaction is fair from a financial point of view to the common stockholders of
Cereus. Robinson-Humphrey's opinion summarized and included in this document as
an appendix, as well

37
<PAGE> 45

as its earlier written opinion, each concluded that the exchange ratio
referenced in such opinion was fair from a financial point of view to the common
stockholders of Cereus, although Robinson-Humphrey relied on different
information and utilized different methodologies, in each case as it considered
appropriate in reaching its conclusions.

THE FULL TEXT OF THE WRITTEN OPINION OF ROBINSON-HUMPHREY CONFIRMING
ROBINSON-HUMPHREY'S ORAL OPINION OF JULY 27, 2000 WHICH SETS FORTH THE
ASSUMPTIONS MADE, MATTERS CONSIDERED AND LIMITATIONS ON THE REVIEW UNDERTAKEN,
IS ATTACHED TO THIS DOCUMENT AS APPENDIX C AND IS INCORPORATED HEREIN BY THIS
REFERENCE. THE DESCRIPTION OF THE ROBINSON-HUMPHREY OPINION SET FORTH HEREIN IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE FULL TEXT OF THE ROBINSON-HUMPHREY
OPINION. CEREUS STOCKHOLDERS ARE URGED TO READ THE OPINION IN ITS ENTIRETY.

THE OPINION OF ROBINSON-HUMPHREY IS DIRECTED TO THE CEREUS BOARD OF
DIRECTORS AND RELATES ONLY TO THE FAIRNESS OF THE EXCHANGE RATIO IN THE PROPOSED
TRANSACTION FROM A FINANCIAL POINT OF VIEW, DOES NOT ADDRESS ANY OTHER ASPECT OF
THE MERGER AND DOES NOT CONSTITUTE A RECOMMENDATION TO ANY STOCKHOLDER AS TO HOW
SUCH STOCKHOLDER SHOULD VOTE AT THE CEREUS ANNUAL MEETING. THE CONSIDERATION TO
BE RECEIVED BY CEREUS STOCKHOLDERS IN THE MERGER WAS DETERMINED ON THE BASIS OF
NEGOTIATIONS BETWEEN CEREUS AND ELTRAX AND WAS APPROVED BY THE CEREUS BOARD.

Material and Information Considered with Respect to the Merger

In arriving at its opinion, Robinson-Humphrey, among other things:

- reviewed a draft of the merger agreement;

- reviewed certain publicly available information concerning Cereus
and Eltrax which Robinson-Humphrey believed to be relevant to its
analysis;

- reviewed certain financial and operating data concerning Cereus and
Eltrax furnished to Robinson-Humphrey by Cereus and Eltrax,
respectively;

- conducted discussions with the management of Cereus and Eltrax
concerning their respective businesses, operations, assets, present
condition and future prospects;

- reviewed the trading histories of the common stock of Cereus and
Eltrax;

- reviewed the historical market prices and trading activities for the
common stock of Cereus and Eltrax and compared them with those of
certain publicly traded companies which Robinson-Humphrey deemed
relevant;

- compared the historical financial results and present financial
condition of Cereus and Eltrax with those of certain publicly traded
companies which Robinson-Humphrey deemed relevant;

- reviewed the financial terms of the proposed transaction with the
financial terms of certain other recent merger and acquisition
transactions which Robinson-Humphrey deemed relevant;

- performed certain financial analyses with respect to Cereus's and
Eltrax's pro forma financial condition and projected future
operating performance;

- reviewed certain historical data relating to percentage premiums
paid in mergers of publicly traded companies; and

- reviewed such other financial statistics and undertook such other
analyses and investigations as Robinson-Humphrey deemed appropriate.

In rendering its opinion, Robinson-Humphrey assumed and relied upon the
accuracy and completeness of the financial and other information used by
Robinson-Humphrey in arriving at its opinion without independent verification.
With respect to the financial forecasts of Cereus and Eltrax, including
estimates of the cost savings and other potential synergies anticipated to
result from the merger, Robinson-Humphrey has assumed that such forecasts have
been reasonably prepared and reflect the best
38
<PAGE> 46

currently available estimates and judgments of Cereus's and Eltrax's respective
management as to future financial performance. In arriving at its opinion,
Robinson-Humphrey conducted only a limited physical inspection of the properties
and facilities of Cereus and Eltrax. Robinson-Humphrey has not made or obtained
any evaluations or appraisals of the assets or liabilities of Cereus or Eltrax.

The Robinson-Humphrey opinion is necessarily based upon market, economic
and other conditions as they existed and could be evaluated on, and on the
information made available to Robinson-Humphrey as of, the date of its opinion.
The financial markets in general and the markets for the common stock of Cereus
and Eltrax, in particular, are subject to volatility, and Robinson-Humphrey's
opinion did not purport to address potential developments in the financial
markets or the markets for the common stock of Cereus and of Eltrax after the
date thereof. Robinson-Humphrey assumed that the merger would be consummated on
the terms described in the merger agreement, without any waiver of any material
terms or conditions by Cereus or Eltrax. Robinson-Humphrey also assumed that in
the course of obtaining the necessary consents or approvals (contractual or
otherwise) for the merger, no restrictions, including any divestiture
requirements or amendments or modifications, would be imposed that would have a
material adverse effect on the consideration of the merger.

In preparing its opinion, Robinson-Humphrey performed a variety of
financial and comparative analyses, including those described below. The summary
of such analyses does not purport to be a complete description of the analyses
underlying Robinson-Humphrey's opinion. The preparation of a fairness opinion is
a complex analytic process involving various determinations as to the most
appropriate and relevant methods of financial analysis and the application of
those methods to the particular circumstances and, therefore, is not readily
susceptible to summary description. Accordingly, Robinson-Humphrey believes that
its analyses must be considered as an integrated whole and that selecting
portions of its analyses and factors, without considering all analyses and
factors, could create a misleading or incomplete view of the processes
underlying such analyses and opinion. In its analyses, Robinson-Humphrey made
numerous assumptions with respect to Cereus, Eltrax, industry performance,
general business, economic, market and financial conditions and other matters,
many of which are beyond the control of Cereus and Eltrax. The estimates
contained in such analyses and the valuation ranges resulting from any
particular analysis are not necessarily indicative of actual values or
predictive of future results or values, which may be significantly more or less
favorable than those suggested by such analyses. In addition, analyses relating
to the value of businesses or securities do not purport to be appraisals or to
reflect the prices at which businesses or securities actually may be sold.
Accordingly, such analyses and estimates are inherently subject to substantial
uncertainty. Robinson-Humphrey's opinion and analyses were only one of several
factors considered by the Cereus board of directors in its evaluation of the
proposed transaction and should not be viewed as determinative of the views of
the Cereus board of directors or management of Cereus with respect to the
consideration to be received by Cereus stockholders in the proposed transaction.
The following is a summary of the material financial and comparative analyses
performed by Robinson-Humphrey in arriving at the Robinson-Humphrey opinion.

Contribution Analysis

Robinson-Humphrey reviewed the relative contribution that Cereus and Eltrax
would be making to the combined pro forma company in terms of revenues, gross
profit, operating income, net income, total assets and stockholders' equity.
Robinson-Humphrey analyzed relative contribution based on latest twelve months
("LTM") ended June 30, 2000, quarter ended June 30, 2000, calendar 2000 and
calendar 2001 results for each company. The relative contribution of Cereus to
the combined entity's pro forma combined financial results ranged from a high of
60.1% (based on June 30, 2000 stockholders' equity) to a low of 0.9% (based on
LTM ended June 30, 2000 gross profit). Robinson-Humphrey noted that Cereus and
Eltrax have negative results for several of the operating and financial measures
analyzed; therefore,

39
<PAGE> 47

contribution analyses based on these measures were not meaningful. The following
table summarizes the relative contribution Eltrax and Cereus would make to the
pro forma combined company based on selected financial measures:

<TABLE>
<CAPTION>
ELTRAX CEREUS
------ ------
<S> <C> <C>
LTM Ended June 30, 2000:
Revenues.................................................. 92.9% 7.1%
Gross Profit.............................................. 99.1 0.9
Total Assets.............................................. 69.7 30.3
Shareholders' Equity...................................... 39.9 60.1
Quarter Ended June 30, 2000:
Revenues.................................................. 89.9% 10.1%
Gross Profit.............................................. 94.2 5.8
Projected Year Ending December 31, 2000:
Revenues.................................................. 87.3% 12.7%
Gross Profit.............................................. 90.5 9.5
Projected Year Ending December 31, 2001:
Revenues.................................................. 81.6% 18.4%
Gross Profit.............................................. 77.7 22.3
</TABLE>

Robinson-Humphrey noted that the 38.8% fully diluted pro forma market
capitalization (based on Eltrax's July 27, 2000 closing stock price and the
merger exchange ratio) that Cereus would contribute to the combined entity was
within or above the overall range of relative contribution that Cereus would
provide to the combined company in terms of revenues, gross profit, operating
income, net income, total assets and shareholders' equity for all of the
financial periods analyzed.

Analysis of Cereus

Market Analysis of Selected Public Companies. Robinson-Humphrey reviewed
and compared selected publicly available financial data, market information and
trading multiples for Cereus with other selected publicly-traded companies in
the IT and Internet services industry which Robinson-Humphrey deemed comparable
to Cereus. This group of 12 publicly traded companies included:

IT AND INTERNET SERVICES PROVIDERS

- American Management Systems, Inc.

- AnswerThink Consulting Group, Inc.

- AppNet, Inc.

- Braun Consulting, Inc.

- Breakaway Solutions, Inc.

- Complete Business Solutions, Inc.

- iXL Enterprises, Inc.

- MarchFIRST, Inc.

- Predictive Systems, Inc.

- Proxicom, Inc.

- Razorfish, Inc.

- Tanning Technology Corporation

For the selected public companies, Robinson-Humphrey compared, among other
things, firm value (or market capitalization plus debt less cash and cash
equivalents) as a multiple of LTM revenues, latest quarter annualized ("LQA")
revenues, calendar 2000 revenues and calendar 2001 revenues and equity values
per share as a multiple of LTM earnings per share ("EPS"), calendar 2000 EPS and
calendar 2001 EPS. Robinson-Humphrey noted that Cereus incurred a net loss in
the LTM and a projected net loss in calendar 2000, therefore valuations based on
LTM and calendar 2000 EPS were not meaningful. All multiples were based on
closing stock prices as of July 27, 2000. Revenue and EPS results for the
selected companies were based on historical financial information available in
public filings of the selected companies. Revenue and EPS estimates were based
on I/B/E/S consensus estimates as of July 27, 2000, except for AnswerThink
Consulting Group, AppNet Systems and iXL Enterprises whose estimates were
obtained from Robinson-Humphrey equity research. I/B/E/S is an information
provider that publishes a compilation of estimates of projected financial
performance for public companies produced by equity

40
<PAGE> 48

research analysts at leading investment banking firms. The following table sets
forth the low, average and high multiples indicated by this analysis for the
comparable companies as of July 27, 2000:

<TABLE>
<CAPTION>
LOW AVERAGE HIGH
---- ------- -----
<S> <C> <C> <C>
PRICE TO:
LTM EPS................................................... 24.0x 131.4x 275.0x
Calendar 2000 EPS......................................... 25.7 61.2 146.4
Calendar 2001 EPS......................................... 18.8 48.7 133.1
FIRM VALUE TO:
LTM Revenues.............................................. 0.84x 4.22x 8.03x
LQA Revenues.............................................. 0.84 3.30 5.68
Calendar 2000 Revenues.................................... 0.80 3.76 7.28
Calendar 2001 Revenues.................................... 0.69 2.50 4.28
</TABLE>

Based upon the multiples derived from this analysis and Cereus's historical
and projected results, Robinson-Humphrey calculated a range of implied equity
values for Cereus between $1.89 and $8.55 per share with an average implied
equity value of $4.77 per share. Robinson-Humphrey noted that the value per
share of $8.31 to be received by Cereus stockholders based on Eltrax's closing
stock price on July 27, 2000 and the exchange ratio was within this valuation
range and represented a premium of 74.3% to the average implied equity value per
share.

Robinson-Humphrey noted that none of the companies used in the market
analysis of selected public companies was identical to Cereus and that,
accordingly, the analysis of comparable public companies necessarily involves
complex considerations and judgements concerning differences in financial and
operating characteristics of the companies reviewed and other factors that would
affect the market values of the selected companies.

Analysis of Selected Merger and Acquisition Transactions. Robinson-Humphrey
reviewed and analyzed the consideration paid in 14 selected completed and
pending mergers and acquisitions involving IT and Internet services providers
since January 1, 1998. The transactions reviewed were:

<TABLE>
<CAPTION>
ANNOUNCE DATE TARGET NAME ACQUIRER NAME
------------- ----------- -------------
<S> <C> <C>
4/9/98....... Claremont Technology Group, Inc. Complete Business Solutions, Inc.
9/9/98....... Integrated Systems Consulting First Consulting Group, Inc.
10/15/98..... BRC Holdings, Inc. Affiliated Computer Services
2/8/99....... Computer Management Sciences Computer Associates International
2/23/99...... Elumen Solutions Computer Task Group
6/24/99...... Data Processing Resource Corp. Compuware Corp.
6/25/99...... Think New Ideas, Inc. AnswerThink Consulting Group
8/9/99....... International Network Services Lucent Technologies, Inc.
8/10/99...... International Integration, Inc. Razorfish, Inc.
9/17/99...... Nichols Research Corporation Computer Sciences Corporation
12/13/99..... USWeb/CKS Whittman-Hart, Inc.
1/26/99...... Eggrock Partners, Inc. Breakaway Solutions, Inc.
3/22/00...... Metamor Worldwide, Inc. PSINet, Inc.
6/22/00...... AppNet, Inc. Commerce One, Inc.
</TABLE>

For the selected transactions, Robinson-Humphrey compared, among other
things, firm value as a multiple of LTM revenues, LTM EBITDA and LTM operating
income and equity values as a multiple of LTM net income and book value.
Revenues, EBITDA, operating income, net income and book value were based on
historical financial information available in public filings of the target
companies involved in the selected transactions. Robinson-Humphrey noted that
Cercus incurred a net loss, an operating loss and negative EBITDA in the LTM,
therefore valuations based on LTM net income, LTM operating income

41
<PAGE> 49

and LTM EBITDA were not meaningful. The following table sets forth the low,
average and high multiples indicated by the selected mergers and acquisitions:

<TABLE>
<CAPTION>
LOW AVERAGE HIGH
PRICE TO: ---- ------- -----
<S> <C> <C> <C>
LTM Net Income............................................ 20.3x 48.3x 122.5x
Book Value (as of June 30, 2000).......................... 2.2 5.5 9.8
FIRM VALUE TO:
LTM Revenues.............................................. 1.47x 5.67x 12.83x
LTM EBITDA................................................ 10.1 29.7 96.0
LTM EBIT.................................................. 12.8 33.6 75.8
</TABLE>

Based upon the multiples derived from this analysis and Cereus's historical
and projected results, Robinson-Humphrey calculated a range of implied equity
values for Cereus between $3.40 and $15.33 per share with an average implied
equity value of $8.31 per share. Robinson-Humphrey noted that the value per
share of $8.31 to be received by Cereus stockholders based on Eltrax's closing
stock price on July 27, 2000 and the exchange ratio was within this valuation
range and represented a discount of (0.2%) to the average implied equity value
per share.

Robinson-Humphrey noted that no company utilized in the analysis of
selected transactions is identical to Cereus. All multiples for the selected
transactions were based on public information available at the time of
announcement of such transaction, without taking into account differing market
and other conditions during the period during which the selected transactions
occurred.

Discounted Cash Flow Analysis. Robinson-Humphrey performed a discounted
cash flow analysis of Cereus based upon management's projections for calendar
2000 through calendar 2004 to estimate the net present equity value per share of
Cereus. Robinson-Humphrey calculated a range of net present equity values for
Cereus based on its free cash flow (earnings before interest and after taxes
plus depreciation and amortization expense minus capital expenditures and
increases in working capital) for the calendar years ending December 31, 2000
through December 31, 2004, inclusive, using discount rates ranging from 20% to
25% and terminal value multiples of calendar year 2004 EBITDA ranging from 10.0x
to 15.0x. The analysis indicated the following per share equity valuations of
Cereus:

<TABLE>
<CAPTION>
DISCOUNTED PRESENT VALUE OF EQUITY PER SHARE
----------------------------------------------
DISCOUNT RATE 10.0X 12.5X 15.0X
------------- --------- --------- ----------
<S> <C> <C> <C>
20.0%............................................ $7.69 $9.25 $10.80
22.5............................................. 7.07 8.49 9.90
25.0............................................. 6.52 7.81 9.10
</TABLE>

Based upon Cereus's projected results, Robinson-Humphrey calculated a range
of implied equity values for Cereus between $6.52 and $10.80 per share with a
median implied equity value of $8.49 per share. Robinson-Humphrey noted that the
value per share of $8.31 to be received by Cereus stockholders based on Eltrax's
closing stock price on July 27, 2000 was within this valuation range and
represented a discount of (2.1%) to the average implied equity value per share.

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<PAGE> 50

Analysis of Eltrax

Market Analysis of Selected Public Companies. Robinson-Humphrey reviewed
and compared publicly available financial data, market information and trading
multiples for selected publicly-traded companies in the IT and Internet services
industry which Robinson-Humphrey deemed comparable to Eltrax. This group of
twelve IT and Internet services companies included:

- American Management Systems, Inc.

- AnswerThink Consulting Group, Inc.

- AppNet, Inc.

- Breakaway Solutions, Inc.

- Cambridge Technology Partners, Inc.

- Complete Business Solutions Inc.

- iXL Enterprises, Inc.

- MarchFIRST, Inc.

- Predictive Systems, Inc.

- Proxicom, Inc.

- Tanning Technology Corporation

- Technology Solutions Company

For the selected public companies, Robinson-Humphrey analyzed, among other
things, firm value as a multiple of LTM revenues, LQA revenues, calendar 2000
revenues, calendar 2001 revenues and LTM gross profit. Robinson-Humphrey noted
that Eltrax and its technology services group incurred net losses in the LTM and
projected net losses in calendar 2000 and 2001, therefore valuations based on
LTM, calendar 2000 and calendar 2001 EPS were not meaningful. All multiples were
based on closing stock prices as of July 27, 2000. Revenue and gross profit
results for the selected companies were based on historical financial
information available in public filings of the selected companies. Revenue
estimates were based on I/B/E/S consensus estimates as of July 27, 2000, except
for AnswerThink Consulting Group, AppNet and iXL Enterprises whose estimates
were obtained from Robinson-Humphrey equity research. Based upon the multiples
derived from this analysis and the historical and projected results for Eltrax
and its technology services group Robinson-Humphrey calculated a range of
implied equity values for Eltrax between $1.55 and $10.30 per share. For
purposes of this analysis Robinson-Humphrey assumed Eltrax's hospitality
services group was a discontinued operation and ascribed no value to it.

Robinson-Humphrey also analyzed Eltrax based on a market analysis of
selected public companies assuming the hospitality services group had been sold
for $18.0 million. Based upon: (i) a sale of the hospitality services group for
$18.0 million; (ii) the available financial data, market information and trading
multiples for the IT and Internet services providers; and (iii) Eltrax's
technology services group's historical and projected results, Robinson-Humphrey
calculated a range of implied equity values for Eltrax between $2.26 and $11.01
per shares.

Robinson-Humphrey noted that none of the companies used in the market
analysis of selected public companies was identical to Eltrax or its technology
services group and that, accordingly, the analysis necessarily involves complex
considerations and judgements concerning differences in financial and operating
characteristics of the companies reviewed and other factors that would affect
the market values of the selected companies.

Sum of the Parts Market Analysis of Selected Public
Companies. Robinson-Humphrey reviewed and compared publicly available financial
data, market information and trading multiples for selected publicly traded
companies in five industries which Robinson-Humphrey deemed comparable to five
different business segments within Eltrax. These four segments are IT and
Internet services providers, application service providers ("ASPs"), value-added
IT hardware resellers and customer care companies. This group

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<PAGE> 51

of 12 IT and Internet service providers, five ASPs, four value-added IT hardware
resellers and eight customer care companies included:

IT AND INTERNET SERVICES PROVIDERS

- American Management Systems, Inc.

- AnswerThink Consulting Group, Inc.

- AppNet, Inc.

- Braun Consulting, Inc.

- Cambridge Technology Partners, Inc.

- Complete Business Solutions Inc.

- IXL Enterprises, Inc.

- MarchFIRST, Inc.

- Predictive Systems, Inc.

- Proxicom, Inc.

- Tanning Technology Corporation

- Technology Solutions

APPLICATION SERVICE PROVIDERS

- Breakaway Solutions, Inc.

- Futurelink Corp.

- Interliant, Inc.

- NetSolve Incorporated

- USinternetworking, Inc.

VALUE-ADDED IT HARDWARE RESELLERS

- CompuCom Systems, Inc.

- Manchester Equipment Co., Inc.

- Pomeroy Computer Resources Inc.

- Software Spectrum Inc.

CUSTOMER CARE COMPANIES

- APAC Teleservices

- Convergys Corp.

- ICT Group, Inc.

- RMH Teleservices, Inc.

- SITEL Corporation

- Teletech Holdings, Inc.

- West Teleservices Corp.

- Zamba Corporation

For the selected public companies, Robinson-Humphrey compared, among other
things, firm value as a multiple of LQA revenues, calendar 2000 revenues and
calendar 2001 revenues. LQA results for the selected companies were based on
historical financial information available in public filings of the selected
companies. Revenue estimates were based on I/B/E/S consensus estimates as of
July 27, 2000, except for AnswerThink Consulting Group, AppNet and iXL
Enterprises whose estimates were obtained from Robinson-Humphrey equity
research. Based upon the multiples derived from this analysis and the historical
and projected results of Eltrax's four business segments, Robinson-Humphrey
calculated a range of implied equity values for Eltrax between $1.44 and $10.93
per share. For purposes of this analysis Robinson-Humphrey assumed Eltrax's
hospitality services group was a discontinued operation and ascribed no value to
it.

Robinson-Humphrey also analyzed Eltrax based on a sum of the parts market
analysis of selected public companies assuming the hospitality services group
had been sold for $18.0 million. Based upon: (i) a sale of the hospitality
services group for $18.0 million; (ii) the available financial data, market
information and trading multiples for the IT and Internet services providers,
ASPs, value-added IT hardware resellers and customer care companies; and (iii)
the historical and projected results for Eltrax's IT and Internet services,
application services, value-added IT hardware reseller and customer care
business segments, Robinson-Humphrey calculated a range of implied equity values
for Eltrax between $2.15 and $11.64 per share.

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<PAGE> 52

Robinson-Humphrey noted that none of the public companies used in the sum
of the parts market analysis of selected public companies was identical to
Eltrax or its four business segments and that, accordingly, the analysis
necessarily involves complex considerations and judgments concerning differences
in financial and operating characteristics of the companies reviewed and other
factors that would affect the market values of the selected companies.

Analysis of Selected Merger and Acquisition Transactions. Robinson-Humphrey
reviewed and analyzed the consideration paid in 13 selected completed and
pending mergers and acquisitions involving IT and Internet services providers
since January 1, 1998. The transactions reviewed were:

<TABLE>
<CAPTION>
ANNOUNCE DATE TARGET NAME ACQUIRER NAME
------------- ----------- -------------
<S> <C> <C>
4/9/98 Claremont Technology Group, Inc. Complete Business Solutions, Inc.
9/9/98 Integrated Systems Consulting Group,
Inc. First Consulting Group, Inc.
10/15/98 BRC Holdings, Inc. Affiliated Computer Services, Inc.
1/26/99 Eggrock Partners, Inc. Breakaway Solutions, Inc.
2/8/99 Computer Management Sciences Computer Associates International,
Inc.
2/23/99 Elumen Solutions, Inc. Computer Task Group Incorporated
6/24/99 Data Processing Resource Corporation Compuware Corporation
6/25/99 Think New Ideas, Inc. AnswerThink Consulting Group, Inc.
8/9/99 International Network Services Lucent Technologies Inc.
8/10/99 International Integration Incorporated Razorfish, Inc.
9/17/99 Nichols Research Corporation Computer Sciences Corporation
12/13/99 USWeb Corporation Whittman-Hart, Uniwhale, Inc.
3/22/00 Metamor Worldwide, Inc. PSINet Inc.
6/22/00 AppNet, Inc. Commerce One, Inc.
</TABLE>

For the selected transactions, Robinson-Humphrey compared, among other
things, firm value as a multiple of LTM revenues, LTM EBITDA and LTM operating
income and equity value as a multiple of LTM net income and book value.
Revenues, EBITDA, operating income, net income and book value were based on
historical financial information available in public filings of the target
companies involved in the selected transactions. Robinson-Humphrey noted that
Eltrax incurred a net loss, operating loss and negative EBITDA in the LTM;
therefore, valuations based on LTM net income, LTM operating income and LTM
EBITDA were not meaningful. Based upon the multiples derived from this analysis
and the historical operating results for Eltrax and its technology services
group, Robinson-Humphrey calculated a range of implied equity values for Eltrax
of between $1.86 and $27.63 per share. For purposes of this analysis
Robinson-Humphrey assumed Eltrax's hospitality services group was a discontinued
operation and ascribed no value to it.

Robinson-Humphrey also analyzed Eltrax based on an analysis of selected
mergers and acquisitions transactions assuming the sale of the hospitality
services segment for $18.0 million. Based upon: (i) a sale of the hospitality
services group for $18.0 million; (ii) the multiples derived from this analysis;
and (iii) the historical and projected results for Eltrax's technology services
group, Robinson-Humphrey calculated a range of implied equity values for Eltrax
between $2.57 and $28.33 per share.

Robinson-Humphrey noted that no company utilized in the analysis of
selected transactions is identical to Eltrax, its technology services group or
its hospitality services group. All multiples for the selected transactions were
based on public information available at the time of announcement of such
transaction, without taking into account differing market and other conditions
during the period during which the selected transactions occurred.

Pro Forma Combination Analysis

Robinson-Humphrey reviewed certain pro forma financial effects on Cereus
resulting from the proposed transaction for the projected quarter ending
December 31, 2000 and for the projected calendar year ending December 31, 2001.
Robinson-Humphrey performed this analysis using projections for Cereus and
Eltrax provided by Cereus's and Eltrax's management. Robinson-Humphrey assumed
synergies of $575,000 for the quarter ending December 31, 2000 and $4.6 million
for the year ending December 31,

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<PAGE> 53

2001. Robinson-Humphrey assumed that the merger would be accounted for under the
purchase method of accounting. Using the merger exchange ratio and Eltrax's
closing stock price as of July 27, 2000, the merger was determined to be
dilutive to Cereus's projected EPS for the quarter ending December 31, 2000 and
for the year ending December 31, 2001.

Other Factors and Comparative Analyses

In rendering its opinion, Robinson-Humphrey considered certain other
factors and conducted certain other comparative analyses, including, among other
things, a review of: (i) the historical and projected financial results of
Cereus and Eltrax; (ii) the history of trading prices and volume of shares of
Cereus common stock and shares of Eltrax common stock and the relationship of
movements of such common stock and movements of the common stock of various
other information technology consulting companies and; (iii) the effect of a
sale of Eltrax's hospitality services group on the merger exchange ratio as
determined by the merger agreement.

Information Regarding Robinson-Humphrey

The Cereus board of directors selected Robinson-Humphrey to render a
fairness opinion because Robinson-Humphrey is a nationally recognized investment
banking firm with substantial experience in transactions similar to the merger
and because it is familiar with Cereus, its business and its industry.
Robinson-Humphrey has from time to time rendered, and may in the future render,
investment banking, financial advisory and other services to Cereus for which it
has received, or will receive, customary compensation. Robinson-Humphrey is
continually engaged in the valuation of businesses and their securities in
connection with mergers and acquisitions, leveraged buyouts, negotiated
underwritings, secondary distributions of listed and unlisted securities and
private placements.

Pursuant to letter agreements dated May 30, 2000 and July 27, 2000, Cereus
has agreed to pay Robinson-Humphrey an opinion fee equal to $325,000, $250,000
of which was payable when Robinson-Humphrey delivered its opinion dated June 12,
2000 and $75,000 of which was payable when Robinson-Humphrey delivered its
opinion dated July 27, 2000. The fees paid or payable to Robinson-Humphrey are
not contingent upon the contents of the opinion delivered. In addition, Cereus
has agreed to reimburse Robinson-Humphrey for its reasonable out-of-pocket
expenses, subject to certain limitations, and to indemnify Robinson-Humphrey and
certain related persons against certain liabilities arising out of or in
conjunction with its rendering of services under its engagement, including
certain liabilities under the federal securities laws. In the ordinary course of
its business, Robinson-Humphrey may actively trade in the securities of Cereus
and Eltrax for its own account and the accounts of its customers and,
accordingly, may at any time hold a long or short position in such securities.

INTERESTS OF DIRECTORS AND OFFICERS IN THE MERGER

Some of the Cereus directors and officers have interests in the merger that
are different from, or in addition to, their interests as stockholders in
Cereus. The members of the boards of directors of Cereus and Eltrax were aware
of these additional interests, and considered them, among other matters, when
they approved the merger agreement.

Odom Employment Agreement

Mr. Odom currently serves as Chairman of the Board and Chief Executive
Officer of Cereus. Upon completion of the merger, he will enter into an
employment agreement with Eltrax to serve as Chief Executive Officer of Eltrax.
The agreement will provide for: (i) a three year term which will be
automatically renewed for an additional one year term unless either party gives
notice to the other of its intention not to so renew at least 90 days' prior to
the termination of the then-current term; (ii) the payment of a specified base
salary and an annual bonus in the discretion of the board of directors of
Eltrax; (iii) a prohibition against Mr. Odom's disclosure of confidential
information for a period of two years following termination; and (iv)
continuation of Mr. Odom's salary and benefits for the 24 months following his
termination by Eltrax without cause or by him for good reason.

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<PAGE> 54

Logsdon Employment Agreement

James A. Logsdon currently serves as President and Chief Operating Officer
of Cereus. Upon completion of the merger, he will enter into an employment
agreement with Eltrax to serve as President and Chief Operating Officer of
Eltrax. The agreement will provide for: (i) a three year term which will be
automatically renewed for an additional one year term unless either party gives
notice to the other of its intention not to so renew at least 90 days' prior to
the termination of the then-current term; (ii) the payment of a specified base
salary and an annual bonus in the discretion of the board of directors of
Eltrax; (iii) a prohibition against Mr. Logsdon's disclosure of confidential
information for a period of two years following termination; and (iv)
continuation of Mr. Logsdon's salary and benefits for the 24 months following
his termination by Eltrax without cause or by him for good reason.

Reising Employment Agreement

Juliet M. Reising currently serves as Chief Financial Officer and Executive
Vice President of Cereus. Upon completion of the merger, she will enter into an
employment agreement with Eltrax to serve as Chief Financial Officer, Executive
Vice President and Secretary of Eltrax. The agreement will provide for: (i) a
three year term which will be automatically renewed for an additional one year
term unless either party gives notice to the other of its intention not to so
renew at least 90 days' prior to the termination of the then-current term; (ii)
the payment of a specified base salary and an annual bonus in the discretion of
the board of directors of Eltrax; (iii) a prohibition against Ms. Reising's
disclosure of confidential information for a period of two years following
termination; and (iv) continuation of Ms. Reising's salary and benefits for the
24 months following her termination by Eltrax without cause or by her for good
reason.

Cereus Stock Options and Warrants

Stock options or warrants awarded to Cereus's officers and directors under
Cereus's stock option or warrant plans and existing executive employment
agreements will be assumed by Eltrax and converted into options or warrants (as
the case may be) to acquire shares of Eltrax common stock. No Cereus options or
warrants will accelerate as a result of the merger. Under Cereus's outside
director warrant plan, the unvested warrants would accelerate on completion of
the merger, but Eltrax has obtained acceleration waivers from each of the
individuals who received warrants under this plan. Because Eltrax will assume
the options under Cereus's stock option plan, the acceleration right will not be
triggered.

Indemnification of Cereus Officers and Directors

For six years after the merger, Eltrax has agreed to provide each officer
and director of Cereus and its subsidiaries the same protection against claims
and liabilities with respect to matters arising at or prior to the closing of
the merger that they received as Cereus directors and officers before the
merger. In addition, for three years after the merger, no action may be taken
that would diminish the indemnification rights under Cereus's governing
documents of the officers and directors of Cereus serving before the merger.

APPRAISAL RIGHTS

Under the Delaware General Corporation Law, holders of Cereus common stock
are not entitled to appraisal rights in connection with the merger.

Under the Minnesota Business Corporation Act, holders of Eltrax common
stock are not entitled to appraisal rights in connection with the merger.

REGULATORY APPROVALS

Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and its
associated rules, the merger cannot be consummated until notifications have been
given and certain information and materials have been furnished to and reviewed
by the Antitrust Division of the Department of Justice and the Federal Trade
Commission and the required waiting period has expired or terminated. Even after
the

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<PAGE> 55

waiting period expires or terminates, the Antitrust Division or the Federal
Trade Commission may later challenge the merger on antitrust grounds. If the
merger is not completed within 12 months after the expiration or earlier
termination of the initial waiting period, Cereus and Eltrax will be required to
submit new information to the Antitrust Division and the Federal Trade
Commission, and a new waiting period would begin. Eltrax and Cereus filed the
required notification and report forms under the Hart-Scott-Rodino Act on August
14, 2000 and received notice of early termination of the waiting period on
August 25, 2000. There can be no assurance that a challenge to the merger on
antitrust grounds will not be made or, if a challenge is made, that it would not
be successful.

ACCOUNTING TREATMENT

The merger will be treated as a purchase under generally accepted
accounting principles. The unaudited pro forma consolidated financial
information contained in this document has been prepared using the purchase
method of accounting. See "Unaudited Pro Forma Consolidated Financial
Information."

CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER

THE FOLLOWING DISCUSSION OF FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER
TO CEREUS AND CEREUS STOCKHOLDERS WHO ARE CITIZENS OR RESIDENTS OF THE UNITED
STATES DOES NOT PURPORT TO BE A COMPLETE ANALYSIS OR LISTING OF ALL POTENTIAL
TAX EFFECTS RELEVANT TO A DECISION WHETHER TO VOTE IN FAVOR OF APPROVAL OF THE
MERGER AGREEMENT. NOR DOES THIS DISCUSSION ADDRESS THE TAX CONSEQUENCES THAT MAY
BE RELEVANT TO A PARTICULAR CEREUS STOCKHOLDER SUBJECT TO SPECIAL TREATMENT
UNDER CERTAIN FEDERAL INCOME TAX LAWS, SUCH AS DEALERS IN SECURITIES, BANKS,
INSURANCE COMPANIES, TAX-EXEMPT ORGANIZATIONS, NON-UNITED STATES PERSONS AND
STOCKHOLDERS WHO ACQUIRED THEIR SHARES AS COMPENSATION, NOR ANY CONSEQUENCES
ARISING UNDER THE LAWS OF ANY STATE, LOCAL OR FOREIGN JURISDICTION. THE
DISCUSSION IS BASED UPON THE INTERNAL REVENUE CODE, TREASURY REGULATIONS AND
ADMINISTRATIVE RULINGS AND COURT DECISIONS AS OF THE DATE OF THIS DOCUMENT. ALL
OF THE FOREGOING ARE SUBJECT TO CHANGE, AND ANY CHANGE COULD AFFECT THE
CONTINUING VALIDITY OF THIS DISCUSSION.

WE URGE CEREUS STOCKHOLDERS TO CONSULT THEIR TAX ADVISORS AS TO THE
PARTICULAR EFFECT OF THEIR OWN PARTICULAR FACTS AND CIRCUMSTANCES ON THE FEDERAL
INCOME TAX CONSEQUENCES OF THE MERGER TO THEM, AND ALSO AS TO THE EFFECT OF ANY
STATE, LOCAL, FOREIGN AND OTHER FEDERAL TAX LAWS.

Under current federal income tax law, and based upon assumptions and
representations to be made by Eltrax and Cereus, and assuming that the merger is
consummated in the manner set forth in the merger agreement, it is anticipated
that the following federal income tax consequences would result:

- the merger will qualify as a reorganization under Section 368(a) of the
Internal Revenue Code;

- no gain or loss will be recognized by Cereus as a result of the merger;

- no gain or loss will be recognized by any Cereus stockholder upon the
exchange of Cereus common stock solely for Eltrax common stock in the
merger;

- cash received in the merger by each Cereus stockholder in lieu of a
fractional share interest of Eltrax common stock will be treated as
having been received as a distribution in full payment in exchange for
the fractional share interest of Eltrax common stock that the stockholder
would otherwise be entitled to receive, and any gain or loss recognized
will be capital in nature (assuming the Cereus common stock surrendered
in exchange was held as a capital asset by the stockholder at the time of
the merger);

- the aggregate tax basis of the Eltrax common stock received by each
Cereus stockholder who exchanges Cereus common stock for Eltrax common
stock in the merger will be the same as the stockholder's basis in the
Cereus common stock surrendered in exchange (subject to any adjustments
required as the result of receipt of cash in lieu of a fractional share
interest in Eltrax common stock); and

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<PAGE> 56

- the holding period of the shares of Eltrax common stock received by each
Cereus stockholder in the merger will include the holding period of the
Cereus common stock surrendered in exchange, provided that the
surrendered shares of Cereus common stock were held as a capital asset by
the stockholder at the time of the merger.

Based upon representations to be made by Eltrax and Cereus as of the
effective time of the merger, Rogers & Hardin, counsel to Cereus, will render an
opinion, dated as of the date of the merger, that the merger will qualify as a
reorganization under the Internal Revenue Code with the consequences set forth
above. The opinion also would be subject to the assumptions that the merger is
consummated in the manner and in accordance with the terms of the merger
agreement. The opinion would be based entirely upon the Internal Revenue Code,
regulations then in effect or proposed under the Internal Revenue Code,
then-current administrative rulings and practice and judicial authority, all of
which would be subject to change, possibly with retroactive effect. Consummation
of the merger is conditioned upon the receipt by Cereus of the opinion of Rogers
& Hardin. See "-- What We Must Do to Complete the Merger."

No ruling has been or will be requested from the Internal Revenue Service,
including any ruling as to federal income tax consequences of the merger to
Eltrax, Cereus or Cereus stockholders. Unlike a ruling from the Internal Revenue
Service, the opinions of counsel are not binding on the Internal Revenue
Service. There can be no assurance that the Internal Revenue Service will not
take a position contrary to the positions reflected in such opinions or that
such opinions would be upheld by the courts if challenged.

RESALES OF ELTRAX COMMON STOCK BY AFFILIATES OF CEREUS

The shares of Eltrax common stock to be issued in the merger will be
registered under the Securities Act and will be freely transferable under the
Securities Act, except for shares issued to any stockholder who may be deemed to
be an "affiliate" of Cereus for purposes of Rule 145 under the Securities Act as
of the date of Cereus's annual meeting. Affiliates of Cereus may not sell their
shares of Eltrax common stock acquired in the merger except pursuant to an
effective registration statement under the Securities Act covering those shares
or in compliance with Rule 145 or another applicable exemption from the
registration requirements of the Securities Act. Persons who may be deemed to be
affiliates of Cereus generally include individuals or entities that control, are
controlled by or are under common control with Cereus, and may include certain
officers, directors and principal stockholders of Cereus.

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<PAGE> 57

THE MERGER AGREEMENT

MERGER CONSIDERATION

Upon the merger, each share of Cereus common stock issued and outstanding
immediately before the merger will be converted into the right to receive 1.75
shares of Eltrax common stock, but the exchange ratio may be adjusted downward
as described below. The exchange ratio was determined through arm's-length
negotiations between Eltrax and Cereus. See "The Merger--Background of the
Merger."

The exchange ratio will be adjusted downward to 1.667 shares of Eltrax
common stock for each share of Cereus common stock if Cereus does not amend the
existing bridge facility between Eltrax and Cereus before September 1, 2000 to
provide Eltrax with an additional $5.0 million in borrowing availability under
the bridge facility, provided that this date may be extended to September 18,
2000 if the conditions requiring PNC's consent or action to amend the bridge
facility have not been satisfied and Cereus is negotiating in good faith to
satisfy those conditions.

If the exchange ratio is adjusted to 1.667 because Cereus does not execute
an amendment to the bridge facility to loan Eltrax an additional $5.0 million,
then the exchange ratio may be adjusted further downward, as follows. If Eltrax
sells, in one or more transactions, all or any part of its hospitality services
group for $8.0 million or more in cash in the aggregate before or at the
effective time of the merger, the exchange ratio will be adjusted downward:

- by an amount equal to .007 divided by 1,000,000 for each $1.00 in cash
received by Eltrax at or before the effective time of the merger in
connection with any such sale; and

- by an amount equal to .0035 divided by 1,000,000 for each $1.00 in
principal amount payable to Eltrax on or before the one year anniversary
of the effective time of the merger under the terms of any full-recourse
promissory note received by Eltrax in connection with any such sale,
provided that the repayment of the note is not contingent on any
post-closing event or performance, not subject to any contractual right
of set off, is adequately secured, bears interest at a market rate and
has a fixed repayment schedule and principal amount.

Any disposition by Eltrax of any part of its hospitality services group will not
have an effect on the exchange ratio unless it has already been adjusted to
1.667 shares of Eltrax common stock for each share of Cereus common stock
because Cereus has not executed an amendment to the bridge facility to provide
Eltrax with an additional $5.0 million in borrowing availability under the
bridge facility.

Eltrax and Cereus will post the current exchange ratio on their Web sites
at www.eltrax.com and www.cereus.net. This information will also be available by
calling D.F. King & Co. at 1-800-549-6746. See "--Additional Agreements."

On August 28, 2000 the closing price of Eltrax common stock was $4.75,
making the value of 1.75 shares of Eltrax common stock equal to $8.3125. The
closing price of Cereus common stock on that date was $8.00. Because these stock
prices fluctuate, you will not know when you vote what the shares will be worth
when issued in the merger, and the market value of the shares at the time of the
merger could be higher or lower than the current market value. The market value
of the merger consideration at the time of the merger will depend on various
factors, including the market value of a share of Eltrax common stock at that
time and any effect of the merger itself. You should obtain current stock price
quotations for Eltrax and Cereus. These quotations are available from your stock
broker, in major newspapers and on the Internet.

Each share of Eltrax common stock issued and outstanding at the effective
time of the merger will remain outstanding and unchanged as a result of the
merger.

TREATMENT OF CEREUS STOCK OPTIONS AND WARRANTS

On the record date, there were options for 2,081,598 shares outstanding
under Cereus's stock option plans and outstanding warrants to purchase 8,268,964
shares of Cereus common stock. At the effective

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<PAGE> 58

time of the merger, each Cereus stock option or warrant will be converted to an
option or warrant (as the case may be) to purchase the number of shares of
Eltrax common stock that would have been received by the holder of the Cereus
option or warrant in the merger had the option or warrant been exercised in full
for shares of Cereus common stock immediately before the effective time. Any
fractional shares will be rounded down to the nearest whole share. Cereus stock
options and warrants converted to Eltrax stock options and warrants will be on
the same terms and conditions as were applicable immediately before the
effective time of the merger, except the exercise price per share will be
ratably adjusted by the exchange ratio and rounded down to the nearest cent.
Eltrax will at all times after the merger reserve for issuance a sufficient
number of shares of its common stock to be issued upon the exercise of Cereus
options and warrants. Promptly after the merger, Eltrax will make all filings
required under federal and state securities laws to permit the exercise of the
Cereus options and warrants.

FRACTIONAL SHARES

No fractional shares of Eltrax common stock will be issued to Cereus
stockholders in the merger. Instead, Eltrax will pay to each Cereus stockholder
who would otherwise be entitled to a fractional share of Eltrax common stock an
amount in cash (without interest) determined by multiplying the fraction by the
closing per share sale price of Eltrax common stock on the Nasdaq National
Market for the last trading day before the closing of the merger.

EXCHANGE OF CERTIFICATES

Before the merger, Eltrax will deposit certificates representing Eltrax
common stock to be issued in the merger and an amount of cash sufficient to
cover payments for fractional shares with an exchange agent.

Promptly after the merger, the exchange agent will deliver to each Cereus
stockholder of record immediately before the merger transmittal materials for
use in exchanging certificates representing Cereus common stock for Eltrax
certificates. CEREUS STOCKHOLDERS SHOULD NOT FORWARD THEIR CEREUS CERTIFICATES
UNTIL THEY RECEIVE THE TRANSMITTAL MATERIALS. The exchange agent will deliver
certificates representing shares of Eltrax common stock into which shares of a
stockholder's Cereus common stock are converted in the merger (or any cash
payable for fractional shares) to each Cereus stockholder upon delivery to the
exchange agent of Cereus stock certificates (or indemnity reasonably
satisfactory to Eltrax and the exchange agent, if any of the certificates are
lost, stolen or destroyed). No interest will be paid on cash paid in lieu of a
fractional share or on dividends or distributions that any Cereus stockholder is
entitled to receive.

Until they are surrendered, and subject to applicable law, the Cereus
certificates will as of the merger represent ownership of the number of shares
of Eltrax common stock into which the Cereus shares were converted in the
merger. The holders will be entitled to all rights and privileges of holders of
Eltrax common stock, except that holders of Cereus certificates will not be
entitled to receive dividends or any other distributions declared by Eltrax
until the Cereus certificates are surrendered. After the Cereus certificates are
surrendered, the holders of newly issued Eltrax certificates will be paid,
without interest, any dividends or other distributions with respect to the
shares of Eltrax common stock the record date for which is after the merger.

Any portion of the exchange fund and any remaining certificates that are
not claimed by former Cereus stockholders within 12 months of the merger will be
returned to Eltrax. Any former Cereus stockholder who has not complied with the
exchange procedures after that 12-month period may look only to Eltrax for
payment of merger consideration, without interest.

After the merger, there will be no further transfers of the Cereus
certificates on Cereus's records. If the Cereus certificates are presented to
Eltrax for transfer, they will be canceled against delivery of Eltrax
certificates.

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MANAGEMENT AND BOARDS OF DIRECTORS AFTER THE MERGER

Management

The merger agreement contemplates that Steven A. Odom will serve as the
Chief Executive Officer of Eltrax, James M. Logsdon will serve as the President
and Chief Operating Officer of Eltrax, and Juliet M. Reising will serve as the
Chief Financial Officer and Executive Vice President of Eltrax after the merger.
Effective September 1, 2000, Messrs. Odom and Logsdon and Ms. Reising have been
elected to those offices and Ms. Reising has also been elected to serve as
Secretary of Eltrax. They will enter into employment agreements with Eltrax when
the merger is completed. See "The Merger -- Interests of Directors and Officers
in the Merger." William P. O'Reilly will continue to serve as Eltrax's Chairman
of the Board. See below for biographical information for Messrs. Odom, Logsdon
and O'Reilly and Ms. Reising.

Eltrax Board of Directors

If the merger is approved, at the time of the merger the Eltrax board of
directors will be increased to nine and reconfigured as follows:

<TABLE>
<CAPTION>
BEFORE THE MERGER AFTER THE MERGER
----------------- ----------------
<S> <C>
William P. O'Reilly (Chairman) William P. O'Reilly (Chairman)
James C. Barnard Max E. Bobbitt*
Patrick J. Dirk Gary H. Heck*
Stephen E. Raville James M. Logsdon*
William G. Taylor Amy Newmark*
Steven A. Odom*
Stephen E. Raville
Juliet M. Reising*
Joseph R. Wright, Jr.*
</TABLE>

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

* Current Cereus director.

There are no material relationships between Eltrax or its directors and
officers and Cereus or its directors and officers except as contemplated by the
merger agreement or as described in this document. In the ordinary course of
business and from time to time Eltrax, Cereus and their affiliates and
subsidiaries may do business with each other.

To the best of Eltrax's knowledge, (i) there are no material proceedings to
which any prospective director of Eltrax is a party, or has a material interest,
adverse to Eltrax, and (ii) there have been no events under any bankruptcy act,
no criminal proceedings and no judgments or injunctions that are material to the
evaluation of the ability or integrity of any of these people during the past
five years.

Biographies of Eltrax Directors after the Merger

William P. O'Reilly has been a director of Eltrax since July 1995, Chairman
of the Board of Directors since August 1995, and President and Chief Executive
Officer since April 2000. Mr. O'Reilly also served as Chief Executive Officer of
Eltrax from January 1997 through April 1999. For the past 15 years, Mr. O'Reilly
has been a private investor and entrepreneur. Mr. O'Reilly served as Chairman of
the Board and Chief Executive Officer of Military Communications Center, Inc.
from 1989 to 1994. In 1986, Mr. O'Reilly founded Digital Signal, Inc., a
provider of fiber optic capacity to long distance carriers in the
telecommunications industry, where he served as Chief Executive Officer from
1986 to 1989. In 1981, Mr. O'Reilly founded Lexitel Corporation, a long distance
carrier (which was subsequently acquired by ALC Communications, Inc.), where he
served as Chairman of the Board and Chief Executive Officer from 1980 to 1984.
Mr. O'Reilly is also currently a director of Pointe Communications, Inc., a
builder and operator of international communication networks which provides
voice, video and data services.

Max E. Bobbitt has served as a director of Cereus since January 2000. Mr.
Bobbitt has served as a director of MCI WorldCom, Inc. since 1992. Mr. Bobbitt
was a director of Advanced Telecommunications

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<PAGE> 60

Corporation until its merger with MCI WorldCom, Inc. in December 1992. From July
1998 until the present, Mr. Bobbitt has been a telecommunications consultant.
Mr. Bobbitt is also currently a director of Metromedia China Corporation, a
telecommunications company. From March 1997 until July 1998, Mr. Bobbitt served
as President and Chief Executive Officer of Metromedia China. From January 1996
until March 1997, Mr. Bobbitt was President and Chief Executive Officer of Asian
American Telecommunications Corporation, which was acquired by Metromedia China
in February 1997. From January 1995 until January 1996, Mr. Bobbitt was a
telecommunications consultant.

Gary H. Heck has served as a director of Cereus since January 2000. Mr.
Heck has been a consultant since 1989, most recently as a Managing Partner and
co-founder of PacifiCom, a consulting services company. From 1987 until 1989, he
was President and Chief Executive Office of Telematics Products, Inc., a
telecommunications products company. From 1983 until 1987, he held various
executive positions at Pacific Telesis Corporation, one of the nation's largest
Regional Bell Operating Companies and completed his tenure as a corporate
officer of several subsidiaries of Pacific Telesis and Chief Executive Officer
of PacTel Products Corporation. From 1977 until 1983, Mr. Heck was a Division
Manager and District Manager at AT&T, where he was responsible for sales and
marketing programs. From 1967 until 1977, Mr. Heck held various positions at
Pacific Telephone & Telegraph.

James M. Logsdon has served as the President and Chief Operating Officer
and a director of Cereus since January 2000. He has been elected to serve as the
President and Chief Operating Officer of Eltrax effective September 1, 2000.
From January 1998 to January 2000, Mr. Logsdon served as the Vice President and
General Manager of Branch Operations -- East for the Network Services division
of GTE, a global telecommunications company. From January 1991 to December 1999,
he served as the Vice President, Sales & Marketing -- Commercial Markets for GTE
Supply.

Amy L. Newmark has served as a director of Cereus since January 2000. Ms.
Newmark is a private investor in the technology, Internet and telecommunications
fields. She was Executive Vice President of Strategic Planning at WinStar
Communications, Inc., from 1995 to 1997. Before joining WinStar, she was the
general partner of Information Age Partners, LP, a hedge fund investing
primarily in technology and emerging growth companies. Before that, she was a
securities analyst specializing in telecommunications and technology companies.
Ms. Newmark is also a director of U.S. Wireless Data, Inc., ParkerVision, Inc.,
QueryObject Systems Corp., and iQO.com.

Steven A. Odom has served as the Chairman of the Board and Chief Executive
Officer of Cereus since January 2000. He has been elected to serve as the Chief
Executive Officer of Eltrax effective September 1, 2000. Mr. Odom was Chairman
of the Board of World Access, Inc. from 1994 until June 1999. World Access is a
leading provider of voice, data and Internet products and services around the
world. He was Chief Executive Officer of World Access from 1994 until 1998. From
1990 until 1994, Mr. Odom was a private investor in several companies, including
World Access and its predecessor. From 1987 until 1990, he was President of the
PCS Division of Executone Information Systems in Atlanta, a $300 million public
company that manufactured and distributed telephone systems. From 1983 until
1987, Mr. Odom was the founder, Chairman and Chief Executive Officer of Data
Contract Company, Inc., a manufacturer of telephone switching equipment and
intelligent pay telephones. From 1974 until 1983, he was a founder and Executive
Vice President of Instrument Repair Service, a private company that repaired
test instruments for local exchange carriers.

Stephen E. Raville has been a director of Eltrax since October 1997. Since
1996, Mr. Raville has been Chairman of the Board of Pointe Communications, Inc.
Mr. Raville is also President and controlling stockholder of First Southeastern
Corp., a private investment company he formed in 1992. In 1983, Mr. Raville
founded TA Communications, a long-distance telephone company, and served as its
President. In 1985, in conjunction with a merger between TA and Advanced
Telecommunications Corporation, he became Chairman and Chief Executive Officer
of Advanced Telecommunications until the merger of Advanced Telecommunications
into MCI WorldCom in late 1992.

Juliet M. Reising has served as the Executive Vice President, Chief
Financial Officer and a director of Cereus since March 2000. She has been
elected to serve as the Chief Financial Officer, Executive Vice

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<PAGE> 61

President and Secretary of Eltrax effective September 1, 2000. From February
1999 to March 2000, Ms. Reising served as Chief Financial Officer of MindSpring
Enterprises, Inc., an Internet service provider that merged with EarthLink, Inc.
in February 2000. From September 1998 to February 1999 Ms. Reising served as
Chief Financial Officer of AvData, Inc., a network management services company
acquired by ITC DeltaCom, Inc. in 1999. From September 1997 to September 1998,
Ms. Reising was Vice President and Chief Financial Officer for Composit
Communications International, Inc., an international software development
company, whose operations are now primarily in Israel. From August 1995 to
September 1997 she was Vice President and Chief Financial Officer of InterServ
Services Corporation, which was merged with Aegis Communications, Inc. in 1997.
From September 1994 to August 1995, she was Chief Financial Officer, Executive
Vice President and director of Media Marketing Services, Inc., a promotional
travel incentive company. Ms. Reising started her career with Ernst & Young LLP
in Atlanta, Georgia, where she received her certified public accountant license.

Joseph R. Wright, Jr. has served as a director of Cereus since January
2000. Mr. Wright is Chairman, Chief Executive Officer and Director of AmTec,
Inc., a public company providing telecommunications and Internet services to and
from the Far East. Upon the AmTec merger with Terremark Holdings, Inc. in May
2000, Mr. Wright also became President and Director of Terremark Communications
Group, Inc. Mr. Wright was also Chairman and Director of GRC International,
Inc., a public company that provides advanced computer, engineering and
scientific technologies to government and commercial customers for information
technology, Internet and software systems. GRC was acquired by AT&T in March
2000 and Mr. Wright has joined the AT&T Government Advisory board. He is also
Vice Chairman and Director of Jefferson Consulting Group, LLC, a Washington, DC
consulting firm, and Co-Chairman and Director of Baker & Taylor Holdings, Inc.,
an international book and video distribution company. Mr. Wright was Vice
Chairman, Executive Vice President and Director of W.R. Grace & Company, a
specialty chemicals and healthcare company, Chairman of Grace Energy Company,
and President of Grace Environmental Company from 1989 to 1994. He was Deputy
Director then Director of the Federal Office of Management and Budget under
President Reagan, serving in the Cabinet and the Executive Office of the
President from 1982 to 1989. He was also Deputy Secretary of the Department of
Commerce from 1981 to 1982. Before that, Mr. Wright spent five years as
President and Chief Operating Officer of Citicorp Retail Services and Retail
Consumer Services, following five years in the Departments of Commerce and
Agriculture, including Assistant Secretary.

Cereus Board of Directors

When the merger is completed, Cereus will become a wholly-owned subsidiary
of Eltrax and the Cereus board of directors will consist of the persons elected
at the Cereus annual meeting, until changed in accordance with Cereus's
certificate of incorporation and bylaws.

REPRESENTATIONS AND WARRANTIES

Each of Cereus and Eltrax has made representations and warranties in the
merger agreement, some of which are qualified as to materiality, relating to,
among other things:

- corporate existence, qualification to conduct business and corporate
standing and power;

- capital structure;

- ownership of subsidiaries;

- corporate authority to enter into and carry out the obligations under the
merger agreement and enforceability of the merger agreement;

- financial statements;

- the absence of certain changes or events;

- the truth and accuracy of information prepared and provided by them in
connection with this document;

- litigation;

- compliance with laws, regulations and other requirements;

- employment arrangements;

- employee benefits;

- their respective properties and assets;

- material agreements and contracts;

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- tax matters;

- environmental matters;

- actions that would prevent the merger from constituting a reorganization;

- payment of fees to finders or brokers in connection with the merger
agreement;

- opinions of financial advisors; and

- intellectual property.

For detailed information on these representations and warranties, see the
merger agreement attached to this document as Appendix A.

WHAT WE MUST DO TO COMPLETE THE MERGER

Mutual Conditions

The respective obligations of Cereus and Eltrax to consummate the merger
are subject to the following conditions:

- the merger must have been approved by the Eltrax stockholders and the
Cereus stockholders;

- the registration statement registering the shares of Eltrax common stock
to be issued in the merger must have become effective and no stop order
suspending the effectiveness or proceedings for that purpose shall have
been initiated or threatened by the SEC or any state regulatory
authorities;

- the shares of Eltrax common stock to be issued in the merger must have
been approved for inclusion on the Nasdaq National Market;

- no preliminary or permanent injunction or other order prohibiting the
completion of the merger shall have been issued;

- there shall not be any statute, rule or regulation prohibiting the merger
or making it illegal; and

- all governmental waivers, consents, orders and approvals and all consents
from lenders, lessors or any other third parties must have been obtained,
unless not obtaining those consents or approvals would not be reasonably
likely to have a material adverse effect on the combined company, taken
as a whole.

Cereus's Conditions

Cereus's obligation to consummate the merger is subject to the following
conditions, each of which Cereus may waive:

- Eltrax and Solemn must have performed all of their obligations required
under the merger agreement and all representations and warranties made by
Eltrax and Solemn in the merger agreement must have been true and correct
on the date of the merger agreement and as of the merger closing date,
except where such failure to perform or to be true and correct would not
result in a material adverse effect; and

- Cereus must have received an opinion of its counsel regarding certain tax
consequences and the qualification of the merger as a reorganization
under the Internal Revenue Code.

Eltrax's Conditions

Eltrax's obligation to consummate the merger is also subject to the
following condition, which Eltrax may waive:

- Cereus must have performed all of its obligations required under the
merger agreement and all representations and warranties made by Cereus in
the merger agreement must have been true and correct on the date of the
merger agreement and as of the merger closing date, except where such
failure to perform or to be true and correct would not result in a
material adverse effect.

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<PAGE> 63

For purposes of the merger agreement, a material adverse effect means a
material adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of Eltrax or Cereus (as
applicable) and its subsidiaries taken as a whole, other than any change,
circumstance or effect:

- relating to general economic conditions or the securities markets;

- relating to industry conditions, and not unique to Eltrax or Cereus (as
applicable); or

- resulting from the announcement or existence of the merger agreement and
the merger.

There can be no assurance that the conditions to consummation of the merger
will be satisfied or waived. If the conditions to either party's obligations are
not satisfied in any material respect, the other party may terminate the merger
agreement. See "-- Termination of the Merger Agreement."

WAIVER AND AMENDMENT

The merger agreement may be amended by the parties at any time before or
after the stockholder meetings, except that any amendment after a stockholders
meeting that requires stockholders approval may not be made without that
approval.

At any time before the merger, any party to the merger agreement may:

- extend the time for or waive compliance with the performance of any
obligations or other acts of the other parties to the merger; and

- waive any inaccuracies in the representations and warranties of the other
parties contained in the merger agreement or in any related document.

TERMINATION OF THE MERGER AGREEMENT

The merger agreement may be terminated:

- at any time before the merger by the mutual consent of Eltrax and Cereus;

- by either Cereus or Eltrax, if the merger does not become effective by
December 31, 2000, without the fault of the terminating party, unless
complete governmental and third party authority has not been obtained, in
which case either party may extend the termination date until January 31,
2001;

- by either Cereus or Eltrax if any injunction, order or decree of any
required governmental authority has been denied by final nonappealable
action, provided that the terminating party has used its best efforts to
prevent the entry of and to remove the injunction, order or decree;

- by Cereus if Eltrax's stockholders do not approve the Eltrax merger
proposal;

- by Eltrax if Cereus's stockholders do not approve the merger agreement;

- by Eltrax, at any time before Cereus's annual meeting, if Cereus's board
of directors has withdrawn its recommendation to the Cereus's
stockholders to approve the merger agreement or modified or changed its
recommendation or recommended a competing transaction instead of this
one;

- by Cereus, at any time before Eltrax's annual meeting, if Eltrax's board
of directors has withdrawn its recommendation to Eltrax's stockholders to
approve the issuance of the Eltrax common stock in the merger or modified
or changed its recommendation or recommended a competing transaction
instead of this one;

- by Cereus, if Eltrax or Solemn breach any of their representations,
warranties, covenants or obligations under the merger agreement, or any
representations or warranties become untrue, unless Eltrax continues to
exercise reasonable efforts to cure any breach curable within 30 days;

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- by Eltrax, if Cereus breaches any of its representations, warranties,
covenants or obligations under the merger agreement, or any
representations or warranties become untrue, unless Cereus continues to
exercise reasonable efforts to cure any breach curable within 30 days;

- by Eltrax if Cereus materially breaches the terms of the bridge facility;

- by Eltrax, if Steven A. Odom does not execute his executive employment
agreement; and

- by Eltrax, if Cereus does execute an amendment to the bridge facility to
provide Eltrax with an additional $5.0 million in borrowing availability
under the bridge facility within 10 business days after the conditions to
the execution of that amendment have been met. See "-- What We Must Do to
Complete the Merger--Eltrax's Conditions."

The representations and warranties and most of the covenants in the merger
agreement will terminate upon the merger. The agreements surviving the merger
deal primarily with Eltrax's obligations with respect to exchange procedures for
Cereus's common stock, options and warrants, representations made in this
document and management of Eltrax and Cereus after the merger. After the merger,
neither of the parties will have any liability to the other because of any
breach of the merger agreement, except with respect to agreements of the parties
which by their terms are intended to be performed after the merger.

TERMINATION FEES

Each of Eltrax and Cereus has agreed not to offer to sell its business,
stock or assets to, or carry on negotiations with respect to the sale of its
business, stock or assets with, any third party. Either of Eltrax or Cereus may
consider unsolicited bona fide third-party offers to purchase its business,
stock or assets if its board determines in good faith that the offer must be
considered for the board to act in a manner consistent with fiduciary duties
under applicable law.

Termination Fees Payable by Eltrax

Eltrax has agreed to pay Cereus a termination fee of $5.0 million, plus
expenses, if the merger agreement is terminated under any of the circumstances
set forth below and, at the time of such termination, a competing transaction is
outstanding with respect to Eltrax and within 12 months Eltrax either enters
into a definitive agreement or consummates a transaction with respect to that
competing transaction:

- Cereus terminates the merger agreement because Eltrax's stockholders have
failed to approve the Eltrax merger proposal;

- Cereus terminates the merger agreement because Eltrax's board of
directors has changed or withdrawn its recommendation of the merger; or

- Cereus terminates the merger agreement because the merger has not been
completed by December 31, 2000, through no fault of Cereus, and neither
party has extended the agreement to January 31, 2001.

If a competing transaction is not outstanding with respect to Eltrax,
Eltrax must pay Cereus $2.5 million, plus expenses, if:

- Cereus terminates the merger agreement because Eltrax's stockholders have
failed to approve the Eltrax merger proposal; or

- Cereus terminates the merger agreement because Eltrax has breached any of
its representations, warranties, covenants or obligations under the
merger agreement, or any representations or warranties become untrue,
which breach remains uncured for the applicable period.

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In addition, if Cereus is entitled to receive a termination fee from Eltrax,
Eltrax must reimburse Cereus for the costs incurred by Cereus for making its
personnel available during the period between the signing of the merger
agreement and the closing.

A competing transaction for Eltrax or Cereus, as applicable, is any of the
following involving the other company or any subsidiary whose business comprises
25% of the net revenues, net income or net assets of the other company
(exclusive of Eltrax's hospitality services group);

- any merger, consolidation, share exchange, business combination or other
similar transaction;

- any sale, lease, exchange, mortgage, pledge, transfer or other
disposition of 15% or more of the assets in a single transaction or
series or related transactions, except for the sale of inventory in the
ordinary course; or

- any tender offer or exchange offer for 15% or more of the outstanding
voting securities of the other company or the filing of a registration
statement under the Securities Act in connection with such offer.

Termination Fees Payable by Cereus

Cereus has agreed to pay Eltrax a termination fee of $5.0 million, plus
expenses, if the merger agreement is terminated under one of the circumstances
set forth below and, at the time of such termination, a competing transaction is
outstanding with respect to Cereus, and within 12 months Cereus either enters
into a definitive agreement or consummates a transaction with respect to that
competing transaction:

- Eltrax terminates the merger agreement because Cereus's stockholders have
failed to approve and adopt the merger agreement and the merger;

- Eltrax terminates the merger agreement because Cereus's board of
directors has changed or withdrawn its recommendation of the merger; or

- Eltrax terminates the merger agreement because the merger has not been
completed by December 31, 2000, through no fault of Eltrax, and neither
party has extended the agreement to January 31, 2001.

If a competing proposal is not outstanding with respect to Cereus, Cereus must
pay Eltrax $2.5 million, plus expenses, if:

- Eltrax terminates the merger agreement because Cereus's stockholders have
failed to approve the merger agreement; or

- Eltrax terminates the merger agreement because Cereus has breached any of
its representations, warranties, covenants or obligations under the
merger agreement, or any representations or warranties become untrue,
which breach remains uncured for the applicable period.

COVENANTS PENDING CLOSING

Eltrax and Cereus have agreed to use reasonable efforts in good faith to
take all actions and to do all things necessary, proper, desirable or advisable
to complete the merger and the other transactions contemplated by the merger
agreement as soon as practicable. Eltrax and Cereus have formed a committee to
facilitate the exchange of information and the transition and combination of
their businesses until the merger is completed.

With limited exceptions, each of Eltrax and Cereus has agreed not to offer
to sell to third parties, or negotiate with third parties for the sale of, its
business, stock or assets. See "-- Termination Fees." In

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addition, each of Eltrax and Cereus has agreed that it and its subsidiaries,
except as otherwise contemplated by the merger agreement and subject to limited
exceptions, will:

- conduct its business in the ordinary and usual course of business and
consistent with immediate past practice;

- use all reasonable efforts to preserve intact each business organization
and goodwill, retain officers and key employees and preserve the goodwill
and business relationships with customers;

- not issue, sell or otherwise permit to become outstanding, or authorize
the creation of, any additional shares of capital stock or debt or equity
rights convertible into or exercisable for capital stock, except for
option grants to non-executive employees and shares issued upon the
exercise of outstanding options or warrants;

- not amend its governing documents;

- not make, declare, pay or set aside for payment any dividend (including
stock dividends) or distribution; or adjust, split, combine, redeem,
reclassify, purchase or otherwise acquire, any shares of its capital
stock;

- not take or fail to take any action that would cause the merger not to
qualify as a reorganization within the meaning of Section 368(a) of the
Internal Revenue Code;

- not enter into or amend any employment, consulting, severance or similar
agreements with any director, officer or key employee, except in the
ordinary course of business and consistent with past practice;

- not incur any indebtedness other than in the ordinary course of business
or under an existing credit facility, or refinance existing indebtedness
on terms reasonably satisfactory to the other company;

- not sell, encumber or otherwise dispose of any of its material assets,
deposits, business or properties or enter into a binding contract to do
so;

- not acquire all or any portion of the assets, business, deposits or
properties of any entity, except in the ordinary course of business;

- not make, change or revoke any material tax election or make any material
agreement or settlement regarding taxes with any taxing authority;

- not engage in any action with the intent to adversely impact the merger;

- not adopt or enter into and amend any pension or retirement plan, trust
or fund, except as required to comply with changes in the law;

- not adopt, enter into or amend any bonus, profit sharing, stock option,
compensation, deferred compensation, health care, or other employee
benefit plan for the benefit of any employee or retiree, other than in
the ordinary course of business; and

- use commercially reasonable efforts to maintain insurance with
financially responsible insurance companies on its tangible assets and
business, consistent with past practice.

ADDITIONAL AGREEMENTS

The merger agreement also contains agreements relating to the preparation
and filing of this document and the registration statement filed with the SEC,
the required regulatory filings and the submission of the merger for stockholder
approval. Eltrax and Cereus have also agreed to consult each other before
issuing any public statements and to provide prompt notice to each other if
certain events occur.

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Employment Agreements

At the closing of the merger, Eltrax will enter into executive employment
agreements with Steven A. Odom, James M. Logsdon and Juliet M. Reising. See "The
Merger -- Interests of Directors and Officers in the Merger" for a discussion of
the material terms of these agreements.

Steering Committee

The merger agreement provides for a Steering Committee consisting of two
individuals designated by the Chairman of Eltrax and two individuals designated
by the Chairman of Cereus. As of the date of this document, the Steering
Committee consists of Mr. O'Reilly and Edward C. Barrett as designees of Eltrax
and Mr. Odom and Ms. Reising as designees of Cereus. The purpose of the Steering
Committee is to facilitate the full exchange of information concerning the
business, operations, capital spending, budgets and financial results of Eltrax
and Cereus until the closing of the merger and to facilitate the efficient
transition and combination of the two businesses. Messrs. Odom and Logsdon and
Ms. Reising have been elected as officers of Eltrax effective September 1, 2000.
The Steering Committee will be dissolved when and so long as they continue to
serve as officers of Eltrax or upon closing of the merger. If the merger
agreement is terminated and Cereus is entitled to receive a termination fee
under Section 8.5 of the merger agreement, Eltrax has agreed to pay Cereus
$12,500 per week for each week the Steering Committee was in existence to
reimburse Cereus for its costs associated with making Mr. Odom and Ms. Reising
available as members of the Steering Committee.

Bridge Facility

In connection with the merger agreement as originally executed, Eltrax and
Cereus entered into a Bridge Loan and Security Agreement, as amended, pursuant
to which Cereus extended Eltrax a revolving line of credit, the outstanding
principal balance of which may not exceed $5.0 million at any one time. As of
June 27, 2000, Eltrax had drawn $4.0 million on the bridge facility and as of
July 31, 2000 the entire $5.0 million had been drawn. Eltrax may not make future
draws on the bridge facility unless, at the time, Eltrax does not have any
availability under its revolving line of credit with PNC Bank, and the funds
received are to be used for ordinary course purposes (or, alternatively, Eltrax
has received Steering Committee approval for the intended non-ordinary course
use). Eltrax makes quarterly payments of interest only under the bridge
facility, the principal balance of which is required to be repaid in full no
later than June 14, 2001. To secure its obligations in connection with the
bridge facility, Eltrax has granted Cereus a security interest in all of its
assets.

In the merger agreement as amended and restated, as a condition to Eltrax's
obligation to close the merger, Cereus has agreed that it will loan to Eltrax an
additional $5.0 million under the bridge facility (for total borrowings of $10.0
million from Cereus under the facility), provided that PNC Bank agrees to (i)
permanently reduce the minimum availability requirement under the credit
agreement between it and Eltrax to $1 million, and (ii) amend certain financial
covenants set forth in that credit agreement in a manner reasonably satisfactory
to Cereus. See "-- What We Must Do to Complete the Merger" and "-- Termination
of the Merger Agreement."

If the merger agreement is terminated such that Cereus is entitled to
receive a termination fee, then Eltrax must issue Cereus a warrant to purchase,
at an exercise price equal to $.01 per share, a number of shares of Eltrax's
common stock equal to the amount outstanding on the bridge facility as of the
date of the occurrence of the event giving rise to the termination plus the
amount of the termination fee, divided by the closing price per share of
Eltrax's common stock on that date. However, the number of shares will be
reduced by 75% if Eltrax repays the bridge facility in full within 30 days.

Cereus may convert the amount outstanding under the bridge facility into
that number of shares of Eltrax's common stock equal to 115% of the amount
outstanding divided by $7.563 (the per share closing price of Eltrax's common
stock on the day immediately prior to the date that Eltrax and Cereus publicly
announced the merger).

60
<PAGE> 68

Eltrax has granted Cereus certain demand and "piggyback" registration
rights covering the shares of Eltrax's common stock which will be issued on
exercise of the warrants (assuming they are granted) and conversion of the
amount outstanding under the bridge facility.

Eltrax's obligations in respect of the bridge facility, and Cereus's
security interest in Eltrax's assets, are fully and completely subordinated to
Eltrax's indebtedness to PNC Bank and to PNC Bank's security interest in
Eltrax's assets.

EXPENSES

All expenses incurred in connection with the merger agreement and the
transactions it contemplates will be paid by the party incurring them, except
that Eltrax and Cereus will split equally all printing, filing and mailing
expenses associated with this document and the registration statement.

ARBITRATION

Eltrax and Cereus have agreed to resolve any dispute arising out of the
merger agreement by arbitration.

61
<PAGE> 69

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

The following unaudited pro forma financial statements were prepared to
give effect to the merger and a private placement to two investors described
below (collectively, the "Transactions"). The following unaudited pro forma
consolidated balance sheet as of June 30, 2000 was prepared as if the
Transactions occurred on that date. The unaudited pro forma consolidated
statements of operations for the periods ended December 31, 1999, and June 30,
2000 give effect to the Transactions as of January 1, 1999. The pro forma
consolidated financial statements are presented for informational purposes only,
and are not necessarily indicative of the financial position or results of
operations that would have occurred if the Transactions had been consummated as
of the dates indicated. In addition, the pro forma consolidated financial
statements are not necessarily indicative of future financial condition or
operating results.

The pro forma consolidated financial statements are derived from, and
should be read in conjunction with, the historical financial statements of
Eltrax and Cereus, including the accompanying notes thereto, incorporated by
reference or appearing elsewhere in this document. Certain prior year amounts in
the pro forma consolidated financial statements have been reclassified to
conform with current year presentation. These reclassifications had no effect on
previously reported net loss or stockholders' equity. The pro forma consolidated
financial statements do not reflect any cost savings or other economic
efficiencies resulting from the merger.

The merger will be structured as a stock-for-stock exchange as described in
"The Merger," and will be accounted for under the purchase method of accounting.
Under the purchase method of accounting, assets acquired and liabilities assumed
are recorded at their estimated fair values. Goodwill is generated to the extent
that the merger consideration, including certain transaction and closing costs,
exceeds the fair value of net assets acquired. We are in the process of
determining the purchase price allocation, in which we will allocate the excess
of the purchase price, including transaction costs, over the book value of the
net assets to be acquired between goodwill and other intangible assets. We have
not finalized this purchase price allocation. Furthermore, the final purchase
price allocation may result in a different weighted-average amortization period
for intangible assets than that presented in these pro forma financial
statements. As a result, the final allocation of the excess of purchase price
over the net book value of net assets to be acquired could differ from what is
presented herein.

On July 19, 2000, the board of directors of Eltrax formally determined to
dispose of Eltrax's hospitality services group. The operations of the
hospitality services group have been excluded from the following pro forma
financial statements. Eltrax is in the process of effecting the disposition of
those operations, and has estimated the value of the assets held for sale based
on preliminary data. The final value of the assets held for sale could differ
from what is presented herein.

On July 27, 2000, Eltrax entered into an agreement with two investors to
issue $7.0 million of convertible senior subordinated notes with a one-year
term. Concurrent with the execution of the agreement, $4.0 million of the notes
were issued by Eltrax and funded by the investors. Of the remaining notes, $1.0
million will be funded upon the execution of a definitive agreement for the sale
of certain assets of the hospitality services group for proceeds of at least
$8.0 million, and $2.0 million will be funded upon the effective date of the
merger.

ACCOUNTING CHANGES

Revenue Classification

In December 1999, the SEC issued Staff Accounting Bulletin No. 101,
"Revenue Recognition in Financial Statements" ("SAB 101"). On June 26, 2000, the
SEC issued SAB 101B which delays the implementation date of SAB 101 to the
fourth quarter of 2000. Eltrax is in the process of evaluating the overall
impact of SAB 101 on its financial statements.

62
<PAGE> 70

Accounting for Employee Stock Options

Eltrax is expecting to account for its stock option plans in accordance
with APB Opinion No. 25, "Accounting for Stock Issued to Employees." In April
2000, the Financial Accounting Standards Board issued FASB Interpretation No.
44, "Accounting for Certain Transactions Involving Stock Compensation," ("FIN
44") which contains rules designed to clarify the application of APB Opinion No.
25. FIN 44 will be effective on July 1, 2000 and Eltrax will adopt it at that
time.

Among other matters, the provisions of FIN 44 will change the accounting of
unvested employee stock options and restricted stock awards in a purchase
business combination. The new rules require the intrinsic value of the unvested
awards to be allocated to unearned compensation and recognized as non-cash
compensation cost over the remaining future vesting period. The ultimate amount
to be allocated to unearned compensation will be based on the price of Eltrax
common stock and the number of Cereus unvested employee stock options and
restricted stock awards on the date the merger is completed. The following pro
forma financial statements reflect the application of the provisions of FIN 44,
as described in the accompanying notes.

63
<PAGE> 71

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

PRO FORMA CONSOLIDATED BALANCE SHEET

JUNE 30, 2000

<TABLE>
<CAPTION>
PRO FORMA
ELTRAX(A) CEREUS(B) ADJUSTMENTS PRO FORMA
------------ ------------ ------------------ ------------
<S> <C> <C> <C> <C>
ASSETS

CURRENT ASSETS:
Cash and cash equivalents............................. $ -- $ 9,631,407 $ 9,631,407
Trade accounts receivable, less allowance for doubtful
accounts............................................ 20,869,063 1,581,011 22,450,074
Inventories, principally finished goods............... 622,014 -- 622,014
Notes receivables..................................... -- 4,978,000 $ (4,000,000)(d) 978,000
Prepaid expenses and other current assets............. 1,650,494 658,468 2,308,962
Assets of discontinued operations held for sale....... 12,344,796 -- 12,344,796
------------ ------------ ------------------ ------------
Total current assets........................... 35,486,367 16,848,886 48,335,253
PROPERTY AND EQUIPMENT -- net........................... 9,586,070 1,095,281 10,681,351
OTHER ASSETS:
Intangibles, net of accumulated amortization.......... 8,467,290 5,097,620 86,864,135(c) 100,699,045
270,000(e)
Deposits and other long-term assets................... -- 305,976 305,976
------------ ------------ ------------------ ------------
Total other assets............................. 8,467,290 5,403,596 87,134,135 101,005,021
------------ ------------ ------------------ ------------
TOTAL ASSETS................................... $ 53,539,727 $ 23,347,763 $ 83,134,135 $160,021,625
============ ============ ================== ============

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Short-term debt....................................... $ 13,091,104 -- $ (6,730,000)(e) $ 6,361,104
Notes payable......................................... -- $ 142,817 5,850,000(e) 5,992,817
Advance from Cereus Technology Partners, Inc.......... 4,000,000 (4,000,000)(d) --
Accounts payable...................................... 16,482,291 874,187 17,356,478
Accrued expenses and other current liabilities........ 5,101,723 2,117,194 2,388,387(f) 11,030,684
1,223,380(g)
200,000(h)
Unearned revenue and customer deposits................ 1,851,749 -- 1,851,749
Current maturities of long-term debt.................. 182,261 -- 182,261
------------ ------------ ------------------ ------------
Total current liabilities...................... 40,709,128 3,134,198 (1,068,233) 42,775,093
NONCURRENT LIABILITIES:
Long-term debt, net of current maturities............. -- 81,375 81,375
Other non-current liabilities......................... -- -- 4,638,920(f) 5,438,920
800,000(h)
------------ ------------ ------------------ ------------
Total liabilities.............................. 40,709,128 3,215,573 4,370,688 48,295,389
STOCKHOLDERS' EQUITY:
Common stock.......................................... 258,023 89,847 157,229(c) 415,252
(89,847)(i)
Additional paid in capital............................ 93,180,109 48,587,104 105,767,054(c) 200,097,163
1,150,000(e)
(48,587,104)(i)
Accumulated deficit................................... (80,607,533) (27,393,423) 27,393,423(i) (80,607,533)
Notes receivable from stockholders.................... -- (1,151,338) (1,151,338)
Deferred compensation................................. -- -- (7,027,308)(e) (7,027,308)
------------ ------------ ------------------ ------------
Total stockholders' equity..................... 12,830,599 20,132,190 78,763,447 111,726,236
------------ ------------ ------------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY..... $ 53,539,727 $ 23,347,763 $ 83,134,135 $160,021,625
============ ============ ================== ============
</TABLE>

See accompanying notes to pro forma information

64
<PAGE> 72

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

SIX MONTHS ENDED JUNE 30, 2000

<TABLE>
<CAPTION>
PRO FORMA
ELTRAX(I) CEREUS(J) ADJUSTMENTS PRO FORMA
------------ ------------ --------------- --------------
<S> <C> <C> <C> <C>
Revenue.................................... $ 35,797,641 $ 3,574,154 $ 39,371,795
Cost of revenue............................ 25,047,897 3,144,621 28,192,518
------------ ------------ ------------
Gross profit............................... 10,749,744 429,533 11,179,277
Operating expenses:
Direct expenses.......................... 19,267,148 513,664 19,780,812
Research and development................. 697,016 -- 697,016
Corporate and administrative............. 5,379,950 2,700,094 8,080,044
Amortization of intangibles.............. 702,180 613,404 $ 15,326,959(l) 16,642,543
Stock compensation expense............... -- 2,398,978 1,194,194(m) 3,593,172
Impairment charge........................ -- 5,637,401 5,637,401
Reorganization costs..................... 1,500,000 -- 1,500,000
------------ ------------ ------------ ------------
Total operating expenses.......... 27,546,294 11,863,541 16,521,153 55,930,988
Operating loss from continuing
operations............................... (16,796,550) (11,434,008) (16,521,153) (44,751,711)
Interest income............................ -- 299,567 299,567
Interest expense........................... (287,940) -- (597,060)(n) (885,000)
Loss on disposal of assets................. (41,628) -- (41,628)
------------ ------------ ------------ ------------
Loss from continuing operations before
income taxes and extraordinary item...... (17,126,118) (11,134,441) (17,118,213) (45,378,772)
Income taxes............................... -- -- --
------------ ------------ ------------ ------------
Loss from continuing operations before
extraordinary item....................... $(17,126,118) $(11,134,441) $(17,118,213) $(45,378,772)
============ ============ ============ ============
Loss per common share:
Loss before discontinued operations and
extraordinary item
Basic and diluted...................... $ (0.69) $ (1.41) $ (1.18)
============ ============ ============
Weighted average shares outstanding
Basic and diluted...................... 24,789,876 7,876,377 38,573,536
============ ============ ============
</TABLE>

See accompanying notes to pro forma information

65
<PAGE> 73

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999

<TABLE>
<CAPTION>
PRO FORMA
------------------
ELTRAX(I) CEREUS(J) ADJUSTMENTS PRO FORMA
------------ ----------- ------------------ ----------------
<S> <C> <C> <C> <C>
Revenue...................................... $ 61,684,652 $ 1,695,853 $ 63,380,505
Cost of revenue.............................. 41,708,579 1,935,121 43,643,700
------------ ----------- ------------
Gross profit................................. 19,976,073 (239,268) 19,736,805
Operating expenses:
Direct expenses............................ 17,885,190 163,845 18,049,035
Research and development................... 1,391,911 -- 1,391,911
Corporate and administrative............... 4,438,187 797,107 5,235,294
Amortization of intangibles................ 1,403,766 680,833 $ 30,653,918(l) 32,738,518
Stock compensation expense................. -- 1,063,300 2,388,387(m) 3,451,687
Reorganization costs....................... 462,000 -- 462,000
Transaction costs.......................... 251,078 -- 251,078
------------ ----------- ------------ ------------
Total operating expenses............ 25,832,132 2,705,085 33,042,306 61,579,523
Operating loss from continuing operations.... (5,856,059) (2,944,353) (33,042,306) (41,842,718)
Interest income.............................. 96,498 -- 96,498
Interest expense............................. (279,670) (513,242) (1,575,795)(n) (2,368,707)
------------ ----------- ------------ ------------
Loss before income taxes and discontinued
operations................................. (6,039,231) (3,457,595) (34,618,101) (44,114,927)
Income tax benefit........................... (154,773) -- (154,773)
------------ ----------- ------------ ------------
Loss before discontinued operations.......... $ (5,884,458) $(3,457,595) $(34,618,101) $(43,960,154)
============ =========== ============ ============
Loss per common share:
Loss before discontinued operations
Basic and diluted........................ $ (0.25) $ (1.57) $ (1.59)
============ =========== ============
Weighted average shares outstanding
Basic and diluted........................ 23,728,262 2,198,690 27,575,970
============ =========== ============
</TABLE>

See accompanying notes to pro forma information

66
<PAGE> 74

ELTRAX SYSTEMS

NOTES TO PRO FORMA INFORMATION

NOTE 1. BASIS OF PRESENTATION

The pro forma consolidated balance sheet assumes that the Transactions took
place June 30, 2000.

The pro forma consolidated statements of operations for the periods ended
June 30, 2000 and December 31, 1999 assume the Transactions took place January
1, 1999.

There are no material differences between the accounting policies of Eltrax
and Cereus.

NOTE 2. PRO FORMA ADJUSTMENTS

The pro forma adjustments are based on Eltrax's estimates of the value of
the tangible and intangible assets acquired. Under purchase accounting, the
total acquisition cost will be allocated to Cereus's assets and liabilities
based on their relative fair values. The final allocations may be different from
those reflected herein.

(a) Reflects the historical financial position of Eltrax at June 30, 2000.

(b) Reflects the historical financial position of Cereus at June 30, 2000.

(c) Represents the valuation of intangible assets resulting from the
preliminary allocation of the $107.1 million purchase price, including
transaction costs, over the book value of the net assets acquired. The purchase
price reflects:

- approximately $78.0 million relating to the issuance of approximately
15.7 million shares of Eltrax common stock in exchange for
approximately 9.0 million shares of Cereus common stock, based on an
exchange ratio of 1.75 to 1. For purposes of preparing the pro forma
information, the fair value of the merger consideration was based on
the average market price for Eltrax common stock of $4.96 per share;

- approximately $20.5 million relating to the issuance of warrants to
purchase approximately 11.6 million shares of Eltrax common stock in
exchange for vested warrants to purchase approximately 6.7 million
shares of Cereus common stock, based on a weighted average fair value
of $1.76 for all warrants. The fair value was determined using the
Black-Scholes option-pricing model and was based on the following
weighted-average assumptions: expected volatility -- 69%; expected
lives -- one year; risk-free interest rate -- 6.5%; and expected
dividend yield -- 0%;

- approximately $1.3 million relating to the issuance of options to
purchase approximately 443,000 shares of Eltrax common stock in
exchange for vested options to purchase approximately 253,000 shares
of Cereus common stock, based on a weighted average fair value of
$2.98 for all options. The fair value was determined using the
Black-Scholes option-pricing model and was based on the assumptions
described above;

- approximately $3.8 million relating to the issuance of warrants to
purchase approximately 2.8 million shares of Eltrax common stock in
exchange for unvested warrants to purchase approximately 1.6 million
shares of Cereus common stock. The fair value was determined using the
Black-Scholes option-pricing model and was based on the assumptions
described above;

- approximately $2.2 million relating to the issuance of options to
purchase approximately 1.4 million shares of Eltrax common stock in
exchange for unvested options to purchase approximately 798,000 shares
of Cereus common stock. The fair value was determined using the
Black-Scholes option-pricing model and was based on the assumptions
described above; and

67
<PAGE> 75
ELTRAX SYSTEMS

NOTES TO PRO FORMA INFORMATION -- (CONTINUED)

- transaction costs of approximately $1,223,000.

(d) Reflects the elimination of intercompany amounts.

(e) Represents the issuance of $7.0 million of convertible senior
subordinated notes, approximately 365,000 warrants in connection with the notes,
estimated expenses of $270,000, and the application of the proceeds against
short-term debt.

(f) Represents the estimated deferred compensation resulting from the
portion of the employee stock options and warrants to purchase Eltrax common
stock issued in exchange for the unvested portion of options and warrants to
purchase Cereus common stock. The amounts represent the portion of the intrinsic
value of the unvested portion of the replacement awards related to the future
vesting periods.

(g) Reflects an accrual for transaction costs.

(h) Reflects an accrual for the costs for facilities that will be abandoned
prior to their full terms net of estimated amounts recoverable under potential
future sublease arrangements. The leases include the former Cereus corporate
headquarters.

(i) Reflects the elimination of Cereus's historical stockholder's equity.

(j) Reflects the historical operating results of Eltrax for the periods
presented.

(k) Reflects the historical operating results of Cereus for the periods
presented, before discontinued operations and extraordinary items.

(l) Reflects amortization of the intangible assets over an estimated useful
life of three years based on a preliminary allocation of the purchase price to
the newly acquired intangible property.

(m) Reflects amortization of the deferred compensation resulting from the
portion of the employee stock options and warrants to purchase Eltrax common
stock issued in exchange for the unvested portion of options and warrants to
purchase Cereus common stock over the remaining vesting periods of such options
and warrants.

(n) Reflects interest on $7.0 million of convertible senior subordinated
notes with a one year term, less interest savings on the Eltrax notes payable
and short-term debt.

68
<PAGE> 76

DESCRIPTION OF ELTRAX CAPITAL STOCK

The following statements regarding the Minnesota Business Corporation Act,
Eltrax's articles of incorporation and Eltrax's bylaws are brief summaries, and
may not contain all the information important to you. For a more complete
description of Eltrax's capital stock, you should carefully read the detailed
provisions of the Minnesota Business Corporation Act as well as Eltrax's
articles of incorporation and bylaws. See "Where You Can Find More Information."

Under Eltrax's articles of incorporation, its authorized capital stock
consists of 50,000,000 shares of common stock, par value $.01 per share, and
1,000,000 shares of preferred stock, par value $.01 per share. Eltrax's board
has designated 30,000 shares of the preferred stock as "Preferred Stock Series
A," but no shares of that series are presently outstanding. If Eltrax's
stockholders approve the proposal to amend the articles of incorporation to
increase the number of authorized shares, Eltrax's authorized capital stock will
consist of 100,000,000 shares of common stock and 1,000,000 shares of preferred
stock.

COMMON STOCK

There were 26,093,109 shares of Eltrax's common stock issued and
outstanding as of August 21, 2000. In addition, Eltrax has reserved a total of
12,967,324 shares of common stock for issuance upon exercise of options granted
or to be granted under its stock option plan, upon exercise of outstanding
warrants and upon conversion of outstanding convertible debt. All shares of
Eltrax's common stock now outstanding are fully paid and nonassessable.

The holders of Eltrax's common stock:

- have equal ratable rights to dividends from funds legally available
therefor, when, as and if declared by the board, subject to the rights of
holders of any outstanding preferred stock;

- are entitled to share ratably in all of our assets available for
distribution to holders of Eltrax's common stock upon liquidation,
dissolution or winding up of the affairs of Eltrax, subject to the rights
of holders of any outstanding preferred stock;

- do not have preemptive, subscription or conversion rights and there are
no redemption or sinking fund provisions applicable thereto; and

- are entitled to one vote per share on all matters which stockholders may
vote on at all meetings of stockholders.

The holders of Eltrax's common stock do not have cumulative voting rights,
which means that the holders of more than 50% of outstanding shares voting for
the election of directors can elect all of the directors to be elected, if they
so choose. In that event, the holders of the remaining shares will not be able
to elect any directors.

PREFERRED STOCK

Eltrax's board is authorized, without further stockholder action, to issue
preferred stock in one or more series and to fix the voting rights, liquidation
preferences, dividend rights, repurchase rights, conversion rights, redemption
rights and terms, including sinking fund provisions, and certain other rights
and preferences, of the preferred stock.

Of the 30,000 shares of preferred stock designated as Preferred Stock
Series A, no shares are currently outstanding. If shares of the Preferred Stock
Series A are issued, its holders:

- will have no voting rights, other than as may be provided by the
Minnesota Business Corporation Act;

- will be entitled to an aggregate cash dividend at least equal to the
aggregate cash dividend payable in respect of any other class of stock
when, as and if, cash dividends are payable to other classes;

69
<PAGE> 77

- if Eltrax liquidates or dissolves, will be entitled to receive $7.50 per
share of Preferred Stock Series A payable out of Eltrax's assets before
any payment is made to holders of common stock or any junior class of
preferred stock;

- may be subject at any time to a redemption of their Preferred Stock
Series A at its then-current fair market value; and

- will be entitled at their option to convert their shares of Preferred
Stock Series A into common stock.

Although there is no current intention to do so, Eltrax's board may, without
stockholder approval, issue shares of a class or series of preferred stock with
voting and conversion rights that could adversely affect the voting power of the
holders of common stock and may have the effect of delaying, deferring or
preventing a change in control of Eltrax.

MINNESOTA BUSINESS CORPORATION ACT

Section 302A.671 of the Minnesota Business Corporation Act applies, with
certain exceptions, to any acquisition of Eltrax's voting stock (from a person
other than Eltrax, and other than in connection with certain mergers and
exchanges to which we are a party) resulting in the beneficial ownership of 20%
or more of the voting stock then outstanding. Section 302A.671 requires approval
of any such acquisition by a majority vote of Eltrax's stockholders before it is
consummated. In general, shares acquired without stockholder approval are denied
voting rights and are redeemable at their then fair market value by Eltrax
within 30 days after the acquiring person has failed to give a timely
information statement to Eltrax or the date the stockholders voted not to grant
voting rights to the acquiring person's shares.

Section 302A.673 of the Minnesota Business Corporation Act generally
prohibits any business combination by Eltrax, or any of its subsidiaries, with
any stockholder that purchases 10% or more of Eltrax's voting shares (an
"interested stockholder") within four years following the interested
stockholder's share acquisition date, unless the business combination is
approved by a committee of all of the disinterested members of Eltrax's board
before the interested stockholder's share acquisition date.

Neither Section 302A.671 nor Section 302A.673 will apply to the merger.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for Eltrax's common stock is EquiServe
Trust Company.

70
<PAGE> 78

COMPARISON OF STOCKHOLDER RIGHTS

The rights of Cereus stockholders are governed by Cereus's certificate of
incorporation, its bylaws and Delaware law. After the merger, the rights of
Cereus stockholders will be governed by Eltrax's articles of incorporation, its
bylaws and Minnesota law. The following is a summary of the material differences
between the current rights of Cereus stockholders and those of Eltrax
stockholders. This summary may not contain all of the information that is
important to you. For a full description of the rights of Eltrax stockholders
and Cereus stockholders, you must refer to the governing laws and documents
listed below. We will send you a copy of the articles of incorporation or
certificate of incorporation and bylaws of each company without charge at your
request.

GOVERNING LAW

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Delaware General Corporation Law Minnesota Business Corporation Act
</TABLE>

GOVERNING DOCUMENTS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Cereus's certificate of incorporation Eltrax's articles of incorporation
Cereus's bylaws Eltrax's bylaws
</TABLE>

AUTHORIZED AND ISSUED CAPITAL STOCK

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
- Common stock, $.01 par value per share: 50,000,000 - Common stock, $.01 par value per share: 50,000,000
shares authorized; 9,802,049 shares outstanding shares authorized; 26,093,109 shares outstanding
- Preferred stock, $1.00 par value per share: - Preferred stock, no par value: 1,000,000 shares
10,000,000 shares authorized. authorized; 30,000 "Series A Preferred" shares
designated; no shares outstanding

Eltrax's stockholders are being asked at the Eltrax
annual meeting to approve increasing the authorized
common stock to 100,000,000, subject to the merger
being completed. If the merger is completed, there
would be approximately 43,246,695 shares outstanding
(or 70,409,678 shares assuming exercise of all Cereus
and Eltrax options and warrants and conversion of all
convertible debt into shares of Eltrax common stock).
</TABLE>

ISSUANCE OF PREFERRED STOCK

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Without stockholder approval, the board of directors Without stockholder approval, the board of directors
may: may:
- Set the rights and preferences of various series - Set the rights and preferences of various series
of preferred stock. of preferred stock.
- Issue preferred stock. - Issue preferred stock.
</TABLE>

71
<PAGE> 79

NUMBER OF DIRECTORS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Not less than one nor more than eight, as determined Not less than one nor more than 10, as determined by
by a majority vote of the stockholders or by a a resolution of a majority of the board. There are
resolution of a majority of the board. There are currently five directors, but if the merger is
currently seven directors. completed, there will be nine directors. See "The
Merger -- Management and Boards of Directors after
the Merger."
</TABLE>

CLASSIFICATION OF DIRECTORS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
None. None.
</TABLE>

ELECTION OF DIRECTORS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Directors are elected by a plurality of the votes Directors are elected by a plurality of the votes
cast at a meeting of the stockholders at which a cast at a meeting of the stockholders at which a
quorum is present in person or by proxy. Cumulative quorum is present in person or by proxy. Cumulative
voting is not permitted. voting is not permitted.
</TABLE>

REMOVAL OF DIRECTORS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Directors may be removed with or without cause by a Directors may be removed with or without cause by a
majority vote of all shares entitled to vote at an majority vote of all shares entitled to vote at an
election of directors. election of directors.
</TABLE>

FILLING BOARD VACANCIES

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Vacancies resulting from newly-created directorships Vacancies resulting from the death, resignation,
or from any reason other than removal may be filled removal or disqualification of a director may be
by a majority of the remaining directors, even if filled by a majority of remaining directors, even if
less than a quorum. less than a quorum.
Vacancies resulting from removal shall be filled by a Vacancies resulting from newly-created directorships
majority vote of the stockholders at a meeting called may be filled by a majority of the directors then
for such purpose. serving.
</TABLE>

SPECIAL MEETING OF STOCKHOLDERS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Special meetings may be called by: Special meetings may be called by:
- a majority of the board; - the chief executive officer;
- the president; or - the chief financial officer;
- a majority of the outstanding shares of capital - any two or more directors; or
stock entitled to vote at such meeting. - upon the written request of stockholders holding
10% (or 25%, in the case of a meeting for the
purpose of considering a business combination) or
more of the voting power shares of stock.
</TABLE>

72
<PAGE> 80

CONSENT TO ACTION WITHOUT A STOCKHOLDER MEETING

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Cereus's bylaws provide that any action required to Action may be taken without a meeting if consents in
be taken at an annual or special meeting of writing are signed by all of the stockholders
stockholders may be taken without a meeting if a entitled to vote on that action.
written consent setting forth the action to be taken
is signed by the holders of outstanding stock having
not less than the minimum number of votes that would
be necessary to authorize or take action at a meeting
at which all shares entitled to vote thereon were
present and voted.
</TABLE>

INDEMNIFICATION OF DIRECTORS AND OFFICERS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Cereus's bylaws provide that Cereus shall indemnify Eltrax's bylaws provide that Eltrax shall indemnify
to the fullest extent allowed by Delaware law any to the fullest extent allowed by Minnesota law any
person whom it shall have the power to indemnify from person whom it shall have the power to indemnify from
and against all expenses or liabilities resulting and against all expenses or liabilities resulting
from any action, suit or proceeding brought or from any action, suit or proceeding brought or
threatened to be brought against such person by threatened to be brought against such person by
reason of the fact that he or she is or was a reason of the fact that he or she is or was a
director or officer of Cereus or serves or served at director or officer of Eltrax or serves or served at
any other enterprise at the request of Cereus. any other enterprise at the request of Eltrax. Eltrax
also maintains directors' and officers' liability
insurance.
</TABLE>

LIMITATION OF LIABILITY

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
A director will not be personally liable for monetary A director will not be personally liable for monetary
damages for breach of fiduciary duty as a director, damages for breach of fiduciary duty as a director,
except liability for: except liability for:
- breach of the duty of loyalty; - breach of the duty of loyalty;
- acts not in good faith or that involve - acts not in good faith or that involve
intentional misconduct or a knowing violation of intentional misconduct or a knowing violation of
law; law;
- illegal dividends or other distributions of - illegal dividends or other distributions of
corporate assets; or corporate assets;
- any transaction from which the director derives - violations of certain Minnesota securities laws;
an improper personal benefit. or
- any transaction from which the director derives
an improper personal benefit.
</TABLE>

AMENDMENTS TO CERTIFICATE OR ARTICLES OF INCORPORATION

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Delaware law provides that the certificate of Articles of incorporation may be amended if approved
incorporation may be amended upon the recommendation by a majority of the shares present at a meeting and
of a majority of the board of directors and the entitled to vote on the amendment upon a proposal
affirmative vote of a majority of the capital stock submitted by either:
of Cereus entitled to vote on such amendment. - the board; or
- stockholders owning 3% or more of the voting power
of shares entitled to vote.
</TABLE>

73
<PAGE> 81

AMENDMENT TO BYLAWS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
Cereus's bylaws may be amended by a majority vote of Bylaws may be amended by the board, except for
the board of directors or by a majority vote of the provisions fixing a quorum for stockholders meetings,
stockholders at any regular or special meeting governing director removals and filling of board
thereof if notice of such alteration, amendment or vacancies, and fixing the number, terms,
repeal of the bylaws is contained in the notice of classifications and qualifications of directors.
such meeting.
Bylaws may be amended by the approval of a majority
of the shares present at a meeting and entitled to
vote on the amendment, upon a proposal submitted by
stockholders owning 3% or more of the voting power of
shares entitled to vote.
</TABLE>

CHANGE OF CONTROL PROVISIONS

<TABLE>
<CAPTION>
CEREUS ELTRAX
------ ------
<S> <C>
None. Any business combination with the holder of 10% or
more of outstanding voting shares within four years
following the interested stockholder's share
acquisition date must be approved by a committee of
all of the disinterested members of the board before
the interested stockholder's share acquisition date.
With limited exceptions, any acquisition of shares in
excess of 20% of the voting stock then outstanding
must be approved by a majority vote of stockholders
before it is completed. In general, shares acquired
without stockholder approval do not have voting
rights and are redeemable by Eltrax at their then
fair market value.
</TABLE>

74
<PAGE> 82

ELTRAX ANNUAL MEETING

MEETING DATE

The Eltrax annual meeting will be held on Friday, September 29, 2000, at
Renaissance Waverly Hotel, 2450 Galleria Parkway, Atlanta, Georgia 30339, at
10:00 a.m., local time.

RECORD DATE

You can vote at the Eltrax annual meeting if you owned Eltrax common stock
at the close of business on August 21, 2000.

MATTERS TO BE CONSIDERED

At the Eltrax annual meeting, Eltrax stockholders will be asked to:

1. approve the Eltrax merger proposal;

2. approve an amendment to Eltrax's articles of incorporation to
increase the authorized common stock to 100,000,000 shares, par value $.01
per share;

3. approve an amendment to Eltrax's articles of incorporation to
change Eltrax's name to Verso Technologies, Inc.;

4. elect five directors to serve until the earlier of the expiration
of their terms or the consummation of the merger;

5. adopt the Eltrax 1999 Employee Stock Purchase Plan; and

6. transact such other business as may properly come before the annual
meeting or any adjournments or postponements thereof.

VOTE REQUIRED

Each holder of record of shares of Eltrax common stock on the record date
will be entitled to cast one vote per share on each of the proposals considered
at the annual meeting. The Eltrax merger proposal, the proposals to amend the
articles of incorporation and the proposal to adopt the employee stock purchase
plan will require the approval of Eltrax stockholders owning a majority of the
shares of Eltrax common stock represented at the annual meeting and entitled to
vote on those proposals, provided that a quorum is present. Directors will be
elected by a plurality of the votes cast at the annual meeting, meaning the five
nominees receiving the most votes will be elected directors.

Abstentions will have the same effect as votes cast against approval of the
merger proposal and the other Eltrax proposals. Broker non-votes will have no
effect on the merger proposal or the other proposals. For the election of
directors, abstentions, broker non-votes and instructions to withhold authority
to vote for one or more of the nominees will result in those nominees receiving
fewer votes. Broker non-votes are proxies from brokers or nominees indicating
that those persons have not received instructions from the beneficial owners or
other persons as to certain proposals on which the beneficial owners or persons
are entitled to vote their shares but with respect to which the brokers or
nominees have no discretionary power to vote without instructions.

Shares of Eltrax common stock that are voted "FOR," "AGAINST" or "WITHHELD"
at the Eltrax annual meeting will be treated as being present at such meeting
for purposes of establishing a quorum. Abstentions and broker non-votes will be
counted for purposes of determining the presence or absence of a quorum for the
transaction of business.
75
<PAGE> 83

PROXIES

All shares of Eltrax common stock represented by properly executed proxies
in the enclosed form that are received in time for the annual meeting that have
not been revoked will be voted in accordance with the instructions indicated in
the proxies. IF YOU SUBMIT A PROXY WITHOUT DIRECTIONS, YOUR SHARES WILL BE VOTED
FOR THE APPROVAL OF THE PROPOSALS AND THE ELECTION OF THE NOMINEES. In addition,
the persons designated in the proxy will have discretion to vote your shares
upon any procedural matter relating to the annual meeting, including the right
to vote for any adjournment or postponement thereof proposed by the Eltrax board
of directors, including a postponement and adjournment to solicit additional
proxies. You can revoke your proxy before it is voted either by sending Eltrax a
revocation notice or a new proxy or by attending the Eltrax annual meeting and
voting in person. You will not revoke your proxy simply by attending the Eltrax
annual meeting.

SHARE OWNERSHIP OF MANAGEMENT

As of the close of business on the Eltrax record date, directors and
executive officers of Eltrax and their respective affiliates may be deemed to be
the beneficial owners of shares of Eltrax common stock representing
approximately 8.3% of the outstanding voting power of Eltrax. Each of the
directors and executive officers of Eltrax has indicated that such person
intends to vote or direct the vote of all the shares of Eltrax common stock over
which such person has voting control in favor of the merger proposal, the other
proposals and the election of the nominees. In addition, concurrently with the
execution of the merger agreement, Cereus and the Eltrax directors (who as of
the record date beneficially owned approximately 8.2% of the outstanding shares
of Eltrax common stock) entered into a proxy agreement pursuant to which the
Eltrax directors granted Cereus the right to vote all voting securities of
Eltrax held by the Eltrax directors in favor of the merger proposal.

QUORUM

The holders of a majority of the shares of Eltrax common stock issued and
outstanding and entitled to vote must be present in person or represented by
proxy at the annual meeting in order for a quorum to be present. If a quorum is
not present at the annual meeting, it is expected that the meeting will be
adjourned or postponed to solicit additional proxies.

SOLICITATION OF PROXIES

Proxies are being solicited on behalf of the Eltrax board of directors. In
addition to the use of the mail, solicitation may be made in person or by
telephone or otherwise by our directors, officers and employees. Brokerage
houses, nominees, fiduciaries and other custodians will be requested to forward
soliciting materials to beneficial owners and will be reimbursed for their
reasonable expenses incurred in sending proxy materials to beneficial owners. In
addition, Eltrax has engaged D.F. King & Co., Inc. to assist it in distributing
proxy materials and contacting record and beneficial owners of Eltrax common
stock. Eltrax has agreed to pay D.F. King approximately $8,500 plus
out-of-pocket expenses for its services to be rendered on Eltrax's behalf.
Eltrax's directors, officers and employees will not be additionally compensated
for their solicitation, but may be reimbursed for their out-of-pocket expenses.

INDEPENDENT PUBLIC ACCOUNTANTS

Eltrax's board of directors selected PricewaterhouseCoopers LLP as its
independent public accountants for the fiscal year ending December 31, 2000.
Representatives of PricewaterhouseCoopers are expected to be present at the
annual meeting, and will have the opportunity to make a statement if they desire
to do so and to respond to appropriate questions.

STOCKHOLDERS' PROPOSALS

Any and all stockholder proposals for inclusion in the proxy materials for
Eltrax's next annual meeting of stockholders to be held in 2001 must comply with
the rules and regulations promulgated under the
76
<PAGE> 84

Securities Exchange Act and must be received by Eltrax, at its offices at 400
Galleria Parkway, Suite 300, Atlanta, Georgia 30339, not later than May 2, 2001.
Proposals should be addressed to Eltrax's Secretary.

OTHER MATTERS

Management knows of no matters which will be presented for consideration at
the annual meeting other than those stated in the notice of meeting. However, if
any other matters do properly come before the annual meeting, the person or
persons named in the accompanying proxy form will vote the proxy in accordance
with their best judgment regarding such matters, should an emergency or
unexpected occurrence make the use of such discretionary authority necessary,
and also regarding matters incident to the conduct of the meeting, including any
decisions to adjourn the meeting.

ELTRAX STOCKHOLDERS ARE REQUESTED TO COMPLETE, DATE AND SIGN THE
ACCOMPANYING FORM OF PROXY AND RETURN IT PROMPTLY TO ELTRAX IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.

77
<PAGE> 85

CEREUS ANNUAL MEETING

MEETING DATE

The Cereus annual meeting will be held on Friday, September 29, 2000, at
Renaissance Waverly Hotel, 2450 Galleria Parkway, Atlanta, Georgia 30339, at
11:00 a.m., local time.

RECORD DATE

You can vote at the Cereus annual meeting if you owned Cereus common stock
at the close of business on August 28, 2000.

MATTERS TO BE CONSIDERED

At the Cereus annual meeting, the Cereus stockholders will be asked to:

1. approve the merger agreement;

2. elect seven directors to serve until the earlier of the expiration
of their terms or the consummation of the merger; and

3. transact such other business as may properly come before the Cereus
annual meeting or any adjournments or postponements thereof.

VOTE REQUIRED

The proposal to adopt the merger agreement requires the approval of Cereus
stockholders owning at least a majority of the outstanding shares of Cereus
common stock. Directors will be elected by a plurality of the votes cast at the
annual meeting, meaning the seven nominees receiving the most votes will be
elected directors. Abstentions and broker non-votes will have the same effect as
votes cast against approval of the merger agreement. For the election of
directors, abstentions, broker non-votes and instructions to withhold authority
to vote for one or more of the nominees will result in those nominees receiving
fewer votes. Broker non-votes are proxies from brokers or nominees indicating
that those persons have not received instructions from the beneficial owners or
other persons as to certain proposals on which the beneficial owners or persons
are entitled to vote their shares but with respect to which the brokers or
nominees have no discretionary power to vote without instructions.

Shares of Cereus common stock that are voted "FOR," "AGAINST" or "WITHHELD"
at the Cereus annual meeting will be treated as being present at such meeting
for purposes of establishing a quorum. Abstentions and broker non-votes will be
counted for purposes of determining the presence or absence of a quorum for the
transaction of business.

PROXIES

All shares of Cereus common stock represented by properly executed proxies
in the enclosed form that are received in time for the annual meeting that have
not been revoked will be voted in accordance with the instructions indicated in
the proxies. IF YOU SUBMIT A PROXY WITHOUT DIRECTIONS, YOUR SHARES WILL BE VOTED
FOR THE APPROVAL OF THE MERGER AGREEMENT AND THE ELECTION OF THE NOMINEES. In
addition, the persons designated in the proxy will have discretion to vote your
shares upon any procedural matter relating to the annual meeting, including the
right to vote for any adjournment or postponement thereof proposed by the Cereus
board of directors, including a postponement and adjournment to solicit
additional proxies. You can revoke your proxy before it is voted either by
sending to Cereus a revocation notice or a new proxy or by attending the Cereus
annual meeting and voting in person. You will not revoke your proxy simply by
attending the Cereus annual meeting.

SHARE OWNERSHIP OF MANAGEMENT

78
<PAGE> 86

agreement and the election of the nominees. In addition, concurrently with the
execution of the merger agreement, Eltrax and the Cereus directors (who as of
the record date beneficially owned approximately 3.5% of the outstanding shares
of Cereus common stock) entered into a proxy agreement pursuant to which the
Cereus directors granted Eltrax the right to vote all voting securities of
Cereus held by the Cereus directors in favor of the merger agreement.

QUORUM

The holders of a majority of the shares of Cereus common stock issued and
outstanding and entitled to vote must be present in person or represented by
proxy at the annual meeting in order for a quorum to be present. If a quorum is
not present at the annual meeting, it is expected that the meeting will be
adjourned or postponed to solicit additional proxies.

SOLICITATION OF PROXIES

Proxies are being solicited on behalf of the Cereus board of directors. In
addition to the use of the mail, solicitation may be made in person or by
telephone or otherwise by our directors, officers and employees. Brokerage
houses, nominees, fiduciaries and other custodians will be requested to forward
soliciting materials to beneficial owners and will be reimbursed for their
reasonable expenses incurred in sending proxy materials to beneficial owners. In
addition, Cereus has engaged D.F. King & Co., Inc. to assist in distributing
proxy materials and contacting record and beneficial owners of Cereus common
stock. Cereus has agreed to pay D.F. King approximately $4,000 plus
out-of-pocket expenses for its services to be rendered on Cereus's behalf.
Cereus's directors, officers and employees will not be additionally compensated
for their solicitation, but may be reimbursed for out-of-pocket expenses
incurred in connection therewith.

INDEPENDENT PUBLIC ACCOUNTANTS

Cereus's board of directors selected KPMG, LLP as its independent public
accountants for the fiscal year ending December 31, 2000. Representatives of
KPMG are expected to be present at the annual meeting, and will have the
opportunity to make a statement if they desire to do so and to respond to
appropriate questions.

STOCKHOLDERS' PROPOSALS

Any and all stockholder proposals for inclusion in the proxy materials for
Cereus's next annual meeting of stockholders to be held in 2001 must comply with
the rules and regulations promulgated under the Securities Exchange Act and must
be received by Cereus, at its offices at 1000 Abernathy Road, Suite 1000,
Atlanta, GA 30328, not later than May 2, 2001. Proposals should be addressed to
Cereus's Secretary.

OTHER MATTERS

CEREUS STOCKHOLDERS ARE REQUESTED TO COMPLETE, DATE AND SIGN THE
ACCOMPANYING FORM OF PROXY AND RETURN IT PROMPTLY TO CEREUS IN THE ENCLOSED
POSTAGE-PAID ENVELOPE. CEREUS STOCKHOLDERS SHOULD NOT FORWARD STOCK CERTIFICATES
WITH THEIR PROXY CARDS.

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<PAGE> 87

ADDITIONAL PROPOSALS FOR THE ELTRAX ANNUAL MEETING

ELECTION OF DIRECTORS

Five directors will be elected at the Eltrax annual meeting to serve for
one-year terms beginning at the annual meeting and expiring at the 2001 annual
stockholders meeting or until their respective successors have been elected and
qualified. However, if the merger is completed, Eltrax's board of directors will
be reconfigured and some of the directors elected at the annual meeting will not
serve on the board of directors after the merger. See "The Merger -- Management
and Boards of Directors after the Merger."

It is proposed that these positions be filled by persons nominated to the
board of directors by management. Each director will be elected by the
affirmative vote of a plurality of the votes represented in person or by proxy
at the annual meeting. Proxies will be tabulated by Eltrax's transfer agent. The
inspector of elections appointed at the annual meeting will then combine the
proxy votes with the votes cast at the annual meeting.

If any of the nominees is unavailable to serve for any reason, then a valid
proxy may be voted for the election of such other persons as the person or
persons voting the proxy may deem advisable in their best judgment. Management
has no present knowledge that any of the persons named will be unavailable to
serve. In any event, the enclosed proxy can be voted for only the five nominees
named in this document or their substitutes.

ELTRAX'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" EACH OF THE
NOMINEES NAMED BELOW. Proxies solicited by the board will be voted "for" the
nominees unless instructions to withhold or to the contrary are given.

<TABLE>
<CAPTION>
NOMINEE AGE CURRENT OFFICE
------- --- --------------
<S> <C> <C>
William P. O'Reilly............................ 54 Chairman of the Board,
President and Chief
Executive Officer
James C. Barnard(1)............................ 67 Director
Patrick J. Dirk(2)............................. 60 Director
Stephen E. Raville(2).......................... 53 Director
William G. Taylor(1)........................... 44 Director
</TABLE>

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

(1) Member of the compensation committee.

(2) Member of the audit committee.

Information regarding the business experience of the directors is set forth
below. The information is based on information furnished to us by each director.
See "The Merger Agreement-Management and Boards of Directors after the Merger"
for background information for Messrs. O'Reilly and Raville. See also
"-- Information on the Board and its Committees" and "-- Director and Executive
Compensation."

James C. Barnard has been a director of Eltrax since 1997. Before he
retired in March 1996, Mr. Barnard served as Chairman and Chief Executive
Officer of Access America Telemanagement, Inc., a telecommunications management
company that Mr. Barnard founded in July 1989. Before he founded Access America
Telemanagement, Mr. Barnard served as Chairman and Chief Executive Officer of
LDX NET, INC., a telecommunications company that merged with Williams
Telecommunications in July 1987 to form Williams Telecommunications Group, Inc.
From July 1987 to June 1989, Mr. Barnard served as Vice Chairman of the Board of
Directors of Williams Telecommunications.

Patrick J. Dirk has been a director of Eltrax since its formation. Mr. Dirk
served as Eltrax's President and Chief Executive Officer from its formation
until September 1985 and as Chairman of the Board from formation until May 1989
and from February through August 1995. Mr. Dirk is Chairman of the Board and
Chief Executive Officer of Troy Group, Inc., an enterprise output solutions
provider. From 1973 until

80
<PAGE> 88

1982, Mr. Dirk was employed in various executive positions and as a board member
with Kroy Inc., a marketer of automated lettering systems.

William G. Taylor has been a director of Eltrax since June 1999. Since
1992, Mr. Taylor has been President and director of The Springs Company, a
privately held investment and management services company. Before he joined The
Springs Company in 1990, Mr. Taylor was a Senior Vice President with First Union
National Bank. Mr. Taylor is also a director of Wachovia Bank, N.A. and Kanawha
Insurance Company.

EXECUTIVE OFFICERS

Eltrax's executive officers, their ages, and offices held as of August 21,
2000 are as follows:

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
William P. O'Reilly................... 54 Chairman of the Board, President and
Chief Executive Officer of Eltrax
William A. Fielder III................ 41 Chief Financial Officer and Secretary
of Eltrax
Barry A. Logan........................ 51 President of Eltrax Hospitality Group,
Inc. and Squirrel Systems, Inc.
Johnny H. Butler...................... 56 President of Eltrax Customer Care
Group, Inc.
Denise R. Grey........................ 36 President of Eltrax ASP Group, LLC
</TABLE>

Effective September 1, 2000 Steven A. Odom has been elected to serve as the
Chief Executive Officer of Eltrax, James M. Logsdon has been elected to serve as
the President and Chief Operating Officer of Eltrax and Juliet M. Reising has
been elected to serve as the Chief Financial Officer, Executive Vice President
and Secretary of Eltrax. See "The Merger Agreement -- Management and Boards of
Directors after the Merger."

Information regarding the business experience of the executive officers is
set forth below. The information is based on information furnished to us by each
officer. See "The Merger Agreement -- Management and Boards of Directors after
the Merger" for background information for Messrs. O'Reilly, Odom and Logsdon
and Ms. Reising.

William A. Fielder III has been Eltrax's Chief Financial Officer since
August 1999. From March 1998 through August 1999, Mr. Fielder was Vice President
and Chief Financial Officer of Clarus Corporation, a provider of
business-to-business e-commerce solutions. From April 1991 through February
1998, Mr. Fielder was Vice President and Chief Financial Officer of Gray
Communication Systems, Inc., which owns and operates television stations and
newspapers. From 1984 to 1991, he was employed with Ernst & Young LLP.

Barry A. Logan has been the President of Eltrax Hospitality Group, Inc.
since September 1999, and President of Squirrel Systems, Inc., a subsidiary of
Sulcus Hospitality Technologies Corp., which Eltrax acquired in March 1999,
since June 1997. From 1995 to June 1997, Mr. Logan was Vice President and
General Manager of Squirrel Systems. Mr. Logan was Vice President of Sulcus
Hospitality Technologies from 1993 to 1995. Mr. Logan was Vice President at
Postech Limited, from 1984 through 1989. Mr. Logan was also a founding partner
and Vice President of SQUIRREL(R) Systems of Canada from 1989 to 1993 before it
was acquired by Sulcus Computer Corporation in 1993.

Johnny H. Butler has been the President of Eltrax Customer Care Group, Inc.
since January 2000. From 1993 to 1999, Mr. Butler was Chief Operating Officer of
Encore Systems, Inc. Mr. Butler was the Management Information Systems Director
for Deloitte & Touche from 1987 to 1993. From 1976 through 1987, Mr. Butler was
Director of Operations at Holiday Inn. From 1969 to 1976, Mr. Butler was Vice
President of Information Systems for Regions Bank in Montgomery, Alabama.

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<PAGE> 89

Denise R. Grey has been the President of Eltrax ASP Group since January
2000. From July 1999 to December 1999, Ms. Grey was Eltrax's Chief Marketing
Officer. From 1998 to June 1999, Ms. Grey was Vice President of Field Sales and
Operations for KMC Telecom, a startup competitive local exchange carrier. Before
she joined KMC Telecom, Ms. Grey was the Director of Marketing for AT&T WorldNet
Business Internet services from June 1985 to June 1998.

Information on the Board and its Committees

Eltrax's business and affairs are managed by its board of directors, which
met five times during the year ended December 31, 1999 and took action by
unanimous written consent once. The board has also established a compensation
committee and an audit committee.

The current members of the compensation committee are Messrs. Taylor and
Barnard. The function of the compensation committee is to set the compensation
for those officers who are also directors of Eltrax and to act on other such
matters relating to compensation as it deems appropriate, including the
administration of Eltrax's stock incentive plans. The compensation committee met
four times during the year ended December 31, 1999.

The current members of the audit committee are Messrs. Dirk and Raville.
The function of the audit committee is to review Eltrax's accounting, auditing,
operating and reporting practices. The audit committee reviews Eltrax's annual
financial statements, changes in accounting practices, the selection and scope
of the work of Eltrax's independent auditors and the adequacy of internal
controls for compliance with corporate policies and directives. The audit
committee met two times during the year ended December 31, 1999.

Each of the directors attended 75% or more of the meetings of the board and
committees on which he served during the year ended December 31, 1999.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act requires Eltrax's directors
and executive officers and all persons who beneficially own more than 10% of the
outstanding shares of Eltrax's common stock to file with the SEC initial reports
of ownership and reports of changes in ownership of Eltrax's common stock and
other equity securities. Reporting persons are also required to furnish Eltrax
with copies of all Section 16(a) forms they file. To Eltrax's knowledge, based
solely upon a review of the copies of forms furnished to Eltrax for the year
ended December 31, 1999, and the information provided to Eltrax by reporting
persons, all reporting persons filed the forms required by Section 16 of the
Exchange Act on a timely basis except that Mr. Butler failed to timely file his
initial Form 3 after his election as an executive officer.

DIRECTOR AND EXECUTIVE COMPENSATION

Director Compensation

Directors' Fees. Each director who is not an employee of Eltrax receives a
fee of $1,500 for each fiscal quarter during which he serves on the board.
Accordingly, during the year ended December 31, 1999, Messrs. Barnard, Dirk and
Raville each received $6,000 in fees for services rendered in 1999 and Mr.
Taylor received $3,000. Eltrax reimburses directors for out-of-pocket expenses
incurred in attending board or committee meetings.

Stock Options. Non-employee directors are eligible to receive grants of
stock options under Eltrax's stock incentive plans.

Executive Compensation

The following table shows the cash and non-cash compensation for each of
the last three fiscal years awarded to or earned by Eltrax's Chief Executive
Officer and by Eltrax's other four most highly-compensated executive officers
during the year ended December 31, 1999.

82
<PAGE> 90

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
SECURITIES
UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION(1) YEAR SALARY BONUS OPTIONS COMPENSATION
------------------------------ ---- -------- ------- ---------- ------------
<S> <C> <C> <C> <C> <C>
William P. O'Reilly(2)................ 1999 $188,254(3) $ -- $ --
Chairman of the Board, President 1998 103,846 -- 75,000 --
and Chief Executive Officer 1997 72,692 -- 150,000 25,000
Edward C. Barrett(4).................. 1999 180,069 40,585 50,000 --
President, Eltrax Technology 1998 136,850 -- -- --
Services Group, Inc. 1997 38,760 -- 46,667 --
Barry Logan(5)........................ 1999 150,689 71,821 280,000 --
President, Eltrax Hospitality Group,
Inc. 1998 -- -- 8,678(6)
and President, Squirrel Systems,
Inc. 1997 -- -- 63,634(6) --
Johnny H. Butler(7)................... 1999 184,694 21,143 10,000 --
President, Eltrax Customer Care 1998 61,565 26,850 25,000 --
Group, Inc. 1997 -- -- -- --
Denise R. Grey(8)..................... 1999 93,334 39,470 150,000 --
President, Eltrax ASP Group, LLC 1998 -- -- -- --
1997 -- -- -- --
Don G. Hallacy(9)..................... 1999 192,348 -- 500,000 --
President and Chief Executive
Officer 1998 -- -- -- --
1997 -- -- -- --
</TABLE>

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

(1) William A. Fielder III became Chief Financial Officer and Treasurer on
August 25, 1999, and was appointed Secretary on February 24, 2000. Mr.
Fielder is not listed on the Summary Compensation Table because he earned
less than $100,000 in salary and bonus for fiscal year ended December 31,
1999. Mr. Fielder was granted options to purchase 250,000 shares of common
stock in 1999.

(2) Mr. O'Reilly became President and Chief Executive Officer on April 19, 2000.
During fiscal year 1999, Mr. O'Reilly served as Chairman of the Board. He
also served as Chief Executive Officer from January 1999 through April 1999.

(3) Represents consulting fees paid to Mr. O'Reilly under a consulting agreement
between Eltrax, Montana Corporation, a company of which Mr. O'Reilly is the
sole stockholder, and Mr. O'Reilly.

(4) Mr. Barrett joined Eltrax in August 1997 when Eltrax acquired Hi-Tech
Connections. Mr. Barrett resigned as the President of Eltrax Technology
Services Group effective June 30, 2000.

(5) Mr. Logan joined Eltrax in March 1999 when Eltrax acquired Sulcus
Hospitality Technologies.

(6) Represents shares originally subject to options to purchase shares of common
stock of Sulcus Hospitality Technologies that were converted to options to
purchase shares of common stock in the merger of Sulcus Hospitality
Technologies with Eltrax in March 1999.

(7) Mr. Butler joined Eltrax in September 1998 when Eltrax acquired Encore
Systems, Inc.

(8) Ms. Grey joined Eltrax in July 1999.

(9) Mr. Hallacy resigned as Chief Executive Officer, President and a director
effective April 19, 2000.

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<PAGE> 91

AGGREGATE OPTION EXERCISES AND YEAR-END OPTION VALUES

The following table shows aggregated information concerning each exercise
of stock options during the fiscal year ended December 31, 1999 by Eltrax's
Chief Executive Officer and Eltrax's other four most highly-compensated
executive officers during the year ended December 31, 1999, and the fiscal
year-end value of their unexercised options.

<TABLE>
<CAPTION>
VALUE OF UNEXERCISED IN-THE-
NUMBER OF UNEXERCISED MONEY OPTIONS AT FISCAL
OPTIONS AT FISCAL YEAR END YEAR END(1)
--------------------------- -----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ------------ --------------
<S> <C> <C> <C> <C>
William P. O'Reilly........................... 235,500 0 $622,606 $ --
Edward C. Barrett............................. 93,500 3,167 277,195 8,017
Barry A. Logan................................ 114,680 237,632 486,277 977,580
Johnny H. Butler.............................. 12,500 12,500 48,831 48,831
Denise R. Grey................................ 37,501 112,499 125,385 376,140
Don G. Hallacy................................ 100,000 400,000 390,650 1,562,600
</TABLE>

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

(1) Value of unexercised, in-the-money options based on the spread between the
exercise price and the average of the high and low price of Eltrax common
stock on December 31, 1999, which was $7.7815.

OPTION GRANT TABLE

The following table shows individual grants of stock options made during
the fiscal year ended December 31, 1999 to Eltrax's Chief Executive Officer and
Eltrax's other four most highly-compensated executive officers during the year
ended December 31, 1999.

<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
SHARES % OF ANNUAL RATES OF STOCK
UNDERLYING TOTAL OPTIONS PRICE APPRECIATION FOR
OPTIONS GRANTED TO DATE OPTION TERM(3)
GRANTED EMPLOYEES EXERCISE OPTIONS -----------------------
NAME IN 1999 IN 1999(1) PRICE(2) EXPIRE 5% 10%
---- ---------- ------------- -------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
William P. O'Reilly......... 0 --% $ -- -- $ -- $ --
Edward C. Barrett........... 50,000 2.7 4.44 3/1/09 139,500 354,000
Barry A. Logan(4)........... 230,000 12.5 3.813 3/25/09 551,310 1,397,710
Barry A. Logan.............. 50,000 2.7 3.313 9/29/09 104,200 264,000
Johnny H. Butler............ 0 -- -- -- -- --
Denise R. Grey.............. 150,000 8.2 4.44 6/24/09 418,650 1,060,950
Don G. Hallacy(5)........... 500,000 27.3 3.875 4/12/09 1,217,500 3,087,500
</TABLE>

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

(1) 1,834,500 options granted in 1999.

(2) The exercise price is equal to the fair market value on the date of grant of
the option.

(3) The 5% and 10% appreciation rates are set forth in the SEC rules and no
representation is made that the common stock will appreciate at these
assumed rates or at all.

(4) Mr. Logan also received options to purchase 72,311 shares of common stock
upon the conversion of options to purchase shares of the common stock of
Sulcus Hospitality Technologies in the merger of Sulcus Hospitality
Technologies with Eltrax in March 1999.

(5) Mr. Hallacy was granted an option to purchase 50,000 shares of common stock
on January 1, 2000 at an exercise price of $8.0625 per share. He resigned as
a director and President and Chief Executive Officer effective April 19,
2000. Of the aggregate options granted to Mr. Hallacy, Mr. Hallacy has
exercised options to acquire 168,812 shares, and has until the close of
business on July 17, 2000 to exercise the remaining options to purchase
43,688 shares vested and available for exercise. Options to purchase 337,500
shares expired upon his resignation.

84
<PAGE> 92

Employment Agreements

Don G. Hallacy resigned as a director and as President and Chief Executive
Officer of Eltrax effective April 19, 2000, thereby terminating his Employment
and Non-Competition Agreement with Eltrax. Mr. Hallacy's employment agreement
was entered into on March 24, 1999 and provided for a minimum annual base salary
of $250,000. Because this agreement was terminated, options to purchase 337,500
shares of common stock that were not vested on the termination date expired, and
Mr. Hallacy forfeited any bonus that would have been payable to him under the
agreement for fiscal year 2000 and for all fiscal years thereafter. The
non-competition covenant contained in the agreement will be binding on Mr.
Hallacy for a period of 12 months following his resignation. Mr. Hallacy will
continue to be bound by the confidentiality, disclosure, and assignment
covenants contained in the agreement.

Penelope Sellers resigned as a director and as President of Eltrax
Hospitality Group on August 31, 1999, thereby terminating her Employment and
Non-Competition Agreement with Eltrax. Ms. Sellers' employment agreement was
entered into on August 31, 1998 and provided for a minimum annual base salary of
$94,800. The non-competition covenant contained in the agreement will be binding
on Ms. Sellers for a period of two years following her resignation. Ms. Sellers
will continue to be bound by the confidentiality, disclosure and assignment
covenants contained in the agreement.

Edward C. Barrett resigned as the President of Eltrax Technology Services
Group on June 30, 2000, thereby terminating his Employment and Non-Competition
Agreement with Eltrax. Mr. Barrett's employment agreement was entered into on
August 15, 1997 and provided for a minimum annual base salary of $100,000. The
noncompetition covenant contained in the agreement will be binding on Mr.
Barrett for a period of two years following his resignation. Mr. Barrett will
continue to be bound by the confidentiality, disclosure and assignment covenants
contained in the agreement. See "-- Certain Relationships and Related
Transactions."

Report of the Compensation Committee on Executive Compensation

Policy on Executive Officer Compensation. The executive compensation
program is administered by the compensation committee of the board, which in
1999 consisted of non-employee directors Messrs. Taylor and Barnard. The program
supports Eltrax's commitment to providing superior stockholder value. It is
designed to attract and retain high-quality executives, to encourage them to
make career commitments to Eltrax, and to accomplish Eltrax's short and
long-term objectives. The compensation committee attempts to structure a
compensation program for Eltrax that will reward its top executives with bonuses
and stock and option awards upon attainment of specified goals and objectives
while striving to maintain salaries at reasonably competitive levels. The
compensation committee reviews the compensation (including salaries, bonuses and
stock options) of Eltrax's officers and performs such other duties as may be
delegated to it by the board. The compensation committee held four formal
meetings during the fiscal year ended December 31, 1999.

In reviewing the compensation to be paid to Eltrax's executive officers
during the fiscal year ended December 31, 1999, the compensation committee
sought to ensure that executive officers were rewarded for long-term strategic
management, for increasing Eltrax's value for its stockholders, and for
achieving internal goals.

The key components of executive officer compensation are salary, bonuses
and stock option awards. Salary is generally based on factors such as an
individual officer's level of responsibility, prior years' compensation,
comparison to compensation of other of Eltrax's officers, and compensation
provided at competitive companies and companies of similar size. Bonuses and
stock option awards are intended to reward exceptional performances. Benchmarks
for determining base salary and bonus levels include targeted funds from
operations levels, strength of the balance sheet and creation of stockholder
value. Stock option awards are also intended to increase an officer's interest
in Eltrax's long-term success as measured by the market and book value of its
common stock. Stock awards may be granted to officers and directors of Eltrax
and its subsidiaries and to certain employees who have managerial or supervisory
responsibilities under the various stock incentive plans.
85
<PAGE> 93

CEO Compensation. During the fiscal year ended December 31, 1999, William
P. O'Reilly served in the capacity of Eltrax's Chief Executive Officer from
January through April. In April 1999, Don G. Hallacy assumed the Chief Executive
Officer position. Under the leadership of both men, Eltrax continued its growth
by merging with Windward Technologies, and aggressively entering the Application
Service Provider market.

As of April 1, 1999, Eltrax entered into a consulting agreement with Mr.
O'Reilly which compensates him at a rate of $250,000 annually. Before entering
into this agreement, Mr. O'Reilly was paid $100,000 annually. In March 1999,
Eltrax entered into an employment agreement with Don G. Hallacy, which
compensated him at a rate of $250,000 annually. Mr. Hallacy also received
options to acquire 500,000 shares of common stock at an exercise price equal to
the market price of the stock on his employment date. In April 2000, Mr. Hallacy
resigned as President and Chief Executive Officer for personal reasons, and Mr.
O'Reilly assumed the offices of President and Chief Executive Officer. Based on
pay levels for chief executive officers of publicly traded technology companies,
the compensation committee believes that Mr. Hallacy's total compensation was,
and Mr. O'Reilly's total compensation is, commensurate with executives in
similar positions. The compensation committee does not believe that the
provisions of Section 162(m) of the Internal Revenue Code relating to the
deductibility of compensation paid to named executive officers will limit the
deductibility of such compensation expected to be paid by Eltrax. However,
circumstances may arise in the future that might result in the compensation
committee authorizing compensation that is not entirely deductible.

Respectfully submitted,

William G. Taylor
James C. Barnard

Compensation Committee Interlocks and Insider Participation

During fiscal year ended December 31, 1999, neither of the members of the
compensation committee (i) was an officer or employee of Eltrax or any of its
subsidiaries, (ii) was formerly an officer of Eltrax or any of its subsidiaries,
or (iii) had any relationship requiring disclosure by Eltrax under Item 404 of
Regulation S-K.

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<PAGE> 94

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Based upon information available to Eltrax, the following table shows, as
of August 21, 2000, the shareholdings of:

- each person known to Eltrax to be the beneficial owner of more than 5% of
Eltrax common stock;

- each of Eltrax's directors;

- each executive officer listed in Eltrax's Summary Compensation Table; and

- all of Eltrax's executive officers and directors as a group.

<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED(1)
------------------------
NAME NUMBER PERCENT(2)
---- --------- ----------
<S> <C> <C>
William P. O'Reilly......................................... 1,748,416(3) 6.6%
Edward C. Barrett........................................... 614,290(4) 2.3
Patrick J. Dirk............................................. 373,825(5) 1.4
William G. Taylor........................................... 354,700(6) 1.4
Stephen E. Raville.......................................... 146,250(7) *
James C. Barnard............................................ 101,250(8) *
Barry A. Logan.............................................. 199,040(9) *
Johnny H. Butler............................................ 42,747(10) *
Denise R. Grey.............................................. 78,752(11) *
Don G. Hallacy.............................................. 89,424(12) *
All current directors and executive officers as a group (9
persons) (excluding Messrs. Barrett and Hallacy).......... 3,274,655(13) 12.0
</TABLE>

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

* Less than 1% of the issued and outstanding shares of common stock.

(1) Unless otherwise noted, all of the shares shown are held by individuals or
entities possessing sole voting and investment power with respect to such
shares. Shares not outstanding but deemed beneficially owned by virtue of
the right of a person or member of a group to acquire them within 60 days
of August 21, 2000 are treated as outstanding only when determining the
amount and percentage owned by such individual or group.

(2) In accordance with SEC regulations, the percentage calculations are based
on 26,093,109 shares of common stock issued and outstanding as of August
21, 2000 plus shares of common stock which may be acquired within 60 days
of August 21, 2000 by each individual or group listed.

(3) Includes options to purchase 396,941 shares of common stock exercisable
within 60 days of August 21, 2000. Mr. O'Reilly's address is 400 Galleria
Parkway, Suite 300, Atlanta, Georgia, 30339.

(4) Includes (i) 100,000 shares owned by Mr. Barrett's wife as to which he may
be deemed to share voting and investment power, (ii) 22,500 shares owned by
Mr. Barrett as trustee for the benefit of his minor children as to which he
may be deemed to have sole voting and investment power, and (iii) options
to purchase 96,667 shares of common stock exercisable within 60 days of
August 21, 2000.

(5) Includes (i) 11,400 shares of common stock owned by Troy Systems, Inc., of
which Mr. Dirk is the Chairman of the Board, as to which he may be deemed
to have sole voting and investment power, and (ii) options to purchase
81,750 shares of common stock exercisable within 60 days of August 21,
2000.

(6) Includes (i) 320,000 shares of common stock owned by corporations of which
Mr. Taylor is the Chairman of the Investment Committee as to which he may
be deemed to have sole voting and investment power, and (ii) options to
purchase 31,250 shares of common stock exercisable within 60 days of August
21, 2000.

87
<PAGE> 95

(7) Includes (i) 105,000 shares of common stock owned by Peachtree Capital
Corporation that is being held in trust for Mr. Raville's family limited
partnership as beneficiary, and (ii) options to purchase 41,250 shares of
common stock exercisable within 60 days of August 21, 2000.

(8) Includes (i) 60,000 shares of common stock owned by a trust of which Mr.
Barnard is the trustee, and (ii) options to purchase 41,250 shares of
common stock exercisable within 60 days of August 21, 2000.

(9) Includes options to purchase 197,628 shares of common stock exercisable
within 60 days of August 21, 2000.

(10) Includes options to purchase 21,250 shares of common stock exercisable
within 60 days of August 21, 2000.

(11) Represents options to purchase 78,752 shares of common stock exercisable
within 60 days of August 21, 2000.

(12) Includes 40,000 shares owned by Mr. Hallacy's wife's trust as to which he
may be deemed to share voting and investment power.

(13) Includes (i) an aggregate of 536,400 shares of common stock held by
controlled corporations, jointly with spouses or by spouses, as to which
members of the group may be deemed to have sole or shared voting and
investment power, (ii) options to purchase an aggregate of 951,689 shares
of common stock exercisable within 60 days of August 21, 2000 held by
members of the group, and (iii) 5,000 shares of common stock Eltrax has
agreed to issue to Mr. Fielder on September 30, 2000 as compensation for
services.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Effective April 1999, Montana Corporation, a corporation of which Mr.
O'Reilly is the sole stockholder, and Mr. O'Reilly entered into a consulting
agreement with Eltrax. The agreement provides that Mr. O'Reilly will provide
certain services to Eltrax, including participating in senior management and
assisting Eltrax in identifying and pursuing possible acquisitions, joint
ventures, marketing arrangements and other growth opportunities. The agreement
provides for a consulting fee of $250,000 per year. The term of the agreement is
three years ending March 31, 2002, and renews for successive two-year periods if
not terminated earlier by Eltrax or Mr. O'Reilly. The agreement contains a
non-competition clause that expires two years after the termination of the
agreement.

On December 30, 1999, Eltrax, as borrower, entered into a Loan and Security
Agreement with Mr. O'Reilly, as lender. The loan was established as a line of
credit facility, at an interest rate of 1.5% over the prime rate, and was
secured by Eltrax's general assets. The loan was subordinate to Eltrax's primary
working capital facility. The maturity date of the loan was the earlier of
December 31, 2000 or on demand. On March 17, 2000, in connection with the
closing of Eltrax's new credit facility with PNC Bank, Eltrax paid off the
principal balance and all accrued interest on the loan, an amount totaling
$2,638,652.69.

As a requirement to closing the new facility, PNC Bank required that Mr.
O'Reilly execute a limited guaranty of Eltrax's obligations under the new
facility. As a further condition to closing, Mr. O'Reilly entered into a pledge
agreement under which he deposited a $2.8 million certificate of deposit with
PNC Bank to secure his obligations under the guaranty. On April 19, 2000, the
guaranty was terminated and the collateral was released to Mr. O'Reilly in
accordance with the terms of the new facility.

Effective June 30, 2000, Mr. Barrett resigned as the President of Eltrax
Technology Services Group. Mr. Barrett will continue to be employed by Eltrax
full-time through August 31, 2000 and receive compensation comparable to that he
received under his employment agreement. After August 31, 2000, Mr. Barrett will
become a consultant to Eltrax. As compensation for his consulting services
between September 1, 2000 and December 31, 2000, Eltrax will grant Mr. Barrett
options to purchase 50,000 shares of common stock at a per share price equal to
the fair market value of Eltrax common stock on the

88
<PAGE> 96

grant date. The options will vest ratably over a four-month period and will be
exercisable up to three years from the grant date. See "-- Employment
Agreements."

Effective June 30, 2000, Mr. Fielder stopped receiving a salary from Eltrax
but continues to be employed full-time. On the earlier of September 30, 2000 or
the effective time of the merger, Mr. Fielder will cease his employment with
Eltrax and all of his outstanding stock options to purchase Eltrax common stock
will become vested. Mr. Fielder will have one year to exercise his options,
provided that Eltrax may at its discretion extend the exercise period for one
additional year. As compensation for his services during this period, Eltrax
will issue Mr. Fielder 5,000 shares of common stock at the end of this period.

STOCKHOLDER RETURN PERFORMANCE PRESENTATION

The following line graph compares the yearly percentage change in the
cumulative total stockholder return on Eltrax's common stock against the
cumulative total stockholder return of a peer group of companies and the Nasdaq
Market Index for the five-year period ending on December 31, 1999. This line
graph assumes a $100 investment on December 31, 1994, and actual increases in
the market value of Eltrax's common stock relative to an initial investment of
$100. The comparisons in this table are required by the SEC and are not intended
to forecast or be indicative of possible future performance of Eltrax's common
stock.

The peer group selected represents the published Media General Index of
Business Software and Service Providers.

[PERFORMANCE GRAPH]

<TABLE>
<CAPTION>
12/31/94 12/29/95 12/31/96 12/31/97 12/31/98 12/31/99
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Eltrax Systems, Inc. $100.00 $350.00 $1,025.00 $950.00 $962.50 $1,612.50
Media General Group
Index 100.00 133.01 152.01 169.18 201.92 304.74
Nasdaq Market Index 100.00 129.71 161.18 197.16 278.08 490.46
</TABLE>

89
<PAGE> 97

INCREASE IN AUTHORIZED COMMON STOCK

AMENDMENT TO ELTRAX'S ARTICLES OF INCORPORATION

Eltrax's board of directors has unanimously adopted a resolution approving,
and recommending to Eltrax's stockholders for their approval, an amendment to
Eltrax's articles of incorporation to increase Eltrax's authorized common stock
from 50,000,000 shares of common stock to 100,000,000 shares of common stock,
par value $.01 per share. The increase in authorized common stock will only take
effect if the merger is approved. The merger cannot be completed without
increasing the authorized common stock. If the increase in authorized common
stock is approved, Article III, Section 3.1 of Eltrax's articles of
incorporation will be amended and restated in its entirety as follows:

"This corporation shall have the authority to issue an aggregate of
one hundred million (100,000,000) shares of Common Stock, each with
$.01 par value per share. Such shares shall be designated as this
corporation's "Common Stock."

REASONS FOR THE INCREASE IN ELTRAX'S AUTHORIZED COMMON STOCK

One of the requirements of the merger agreement is that Eltrax take all
action necessary, including amending its articles of incorporation, to increase
the number of its authorized shares of common stock to accommodate the merger.
Eltrax currently does not have enough authorized common stock to issue shares in
the merger and reserve shares for issuance under its stock option plans and for
issuance under Cereus options and warrants assumed in the merger. Of the
50,000,000 currently authorized shares of common stock, as of August 21, 2000,
26,093,109 shares were outstanding. Eltrax will issue approximately 17,153,586
shares of its common stock to Cereus stockholders in the merger (assuming no
adjustment in the exchange ratio and that none of the options and warrants to
acquire Cereus common stock that are exercisable before the merger are
exercised). As of August 21, 2000, 12,967,324 shares were reserved for issuance
under Eltrax's stock option plans and outstanding warrants and upon the
conversion of convertible debt. Assuming no adjustment in the exchange ratio,
upon completion of the merger, approximately 3,642,797 shares will be reserved
for issuance upon exercise of options granted under Cereus's stock option plan
and approximately 14,470,687 shares will be reserved for issuance upon exercise
of outstanding warrants granted by Cereus, in each case assuming no holders of
options or warrants exercise any of the options or warrants to acquire Cereus
common stock that are exercisable before the merger and assuming no adjustment
in the exchange ratio.

Eltrax's board of directors has determined that increasing the number of
outstanding shares of common stock to 100,000,000 will enable Eltrax to complete
the merger, accommodate its stock option plans and the Cereus stock options and
warrants and leave shares available for future issuances. The board of directors
believes that it is desirable that Eltrax have the flexibility to issue a
substantial number of shares of common stock without further stockholder action,
except as otherwise provided by law or the Nasdaq National Market. The
availability of additional shares will enhance Eltrax's flexibility in
connection with possible future actions, such as stock splits, stock dividends,
financings, employee benefit programs, corporate mergers and acquisitions, asset
purchases, the possible funding of new product programs or businesses or other
corporate purposes. The board of directors will determine whether, when, and on
what terms the issuance of shares of common stock may be warranted in connection
with any of the foregoing purposes. Eltrax does not have any current planned use
of the proposed additional shares of common stock other than in connection with
the merger.

The availability for issuance of additional shares of common stock or
rights to purchase such shares could enable the board of directors to render
more difficult or discourage an attempt to obtain control of Eltrax. For
example, the issuance of shares of common stock in a public or private sale,
merger or similar transaction would increase the number of outstanding shares,
thereby possibly diluting the interest of a party attempting to obtain control
of Eltrax. Eltrax is not aware of any pending or threatened efforts to obtain
control of Eltrax, and the board of directors has no present intent to authorize
the issuance of additional shares of common stock to discourage such efforts.

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<PAGE> 98

The issuance of common stock otherwise than on a pro rata basis to all
current stockholders could have the effect of diluting the earnings per share,
book value per share and voting power of current stockholders. If approved, the
amendment to the articles of incorporation will not be implemented unless the
merger is approved.

EFFECTIVENESS OF THE INCREASE IN AUTHORIZED COMMON STOCK

The increase in authorized shares, if approved by Eltrax's stockholders,
would become effective upon the filing with the Minnesota Secretary of State of
a Certificate of Amendment to Eltrax's articles of incorporation that contains
the amendment. It is expected that that filing will take place shortly before
the effective time of the merger, assuming the stockholders approve the increase
in authorized shares and the merger proposal is approved by the stockholders of
Eltrax and Cereus.

APPROVAL BY STOCKHOLDERS

The increase in authorized shares amendment will be approved if
stockholders owning a majority of shares of Eltrax common stock represented at
the meeting and entitled to vote on this proposal vote in favor of it, provided
that a quorum is present. Abstentions will have the same effect as a vote
against this proposal.

RECOMMENDATION OF THE BOARD OF DIRECTORS

Eltrax's board unanimously recommends a vote FOR the proposal to amend
Eltrax's articles of incorporation in order to increase the authorized shares of
common stock to 100,000,000. Proxies solicited by the board will be voted "for"
the proposal unless instructions to the contrary are given.

91
<PAGE> 99

NAME CHANGE

Eltrax's board of directors has unanimously adopted a resolution approving,
and recommending to Eltrax's stockholders for their approval, an amendment to
Eltrax's articles of incorporation to change Eltrax's name from "Eltrax Systems,
Inc." to Verso Technologies, Inc. The name change will only take effect if the
merger is completed. If the name change is approved, the provisions of Article I
of Eltrax's articles of incorporation will be amended to include the following
provision:

"The name of the Corporation shall be "Verso Technologies, Inc."

Eltrax has reserved the new name with the Minnesota Secretary of State.

REASONS FOR THE NAME CHANGE

One of the requirements of the merger agreement is that Eltrax take all
action necessary, including amending its articles of incorporation, to effect
the name change. The management of Eltrax and Cereus believe the new name better
reflects the business strategy that the combined company will pursue.

EFFECTIVENESS OF THE NAME CHANGE

The name change, if approved by Eltrax's stockholders, would become
effective upon the filing with the Minnesota Secretary of State of a Certificate
of Amendment to Eltrax's articles of incorporation that contains the name change
amendment. It is expected that that filing will take place on or shortly after
the effective date of the merger, assuming the stockholders approve the name
change and the merger is completed.

APPROVAL BY STOCKHOLDERS

The name change amendment will be approved if stockholders owning a
majority of shares of Eltrax common stock represented at the meeting and
entitled to vote on this proposal vote in favor of it, provided that a quorum is
present. Abstentions will have the same effect as a vote against this proposal.

RECOMMENDATION OF THE BOARD OF DIRECTORS

Eltrax's board unanimously recommends a vote FOR the proposal to amend
Eltrax's articles of incorporation in order to effect the name change, upon
completion of the merger. Proxies solicited by the board will be voted "for" the
name change proposal unless instructions to the contrary are given.

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<PAGE> 100

EMPLOYEE STOCK PURCHASE PLAN

In November 1999, Eltrax's board of directors adopted the 1999 Employee
Stock Purchase Plan authorizing the issuance of common stock through purchase
rights granted to Eltrax employees. The plan is intended to qualify as an
employee stock purchase plan within the meaning of Section 423 of the Internal
Revenue Code.

The essential features of the plan are outlined below. The following
description of the terms of the plan does not purport to be complete and is
qualified in its entirety by reference to the text of the plan that is attached
as Appendix D to this document.

GENERAL DESCRIPTION OF THE EMPLOYEE STOCK PURCHASE PLAN

The plan is implemented by offerings of rights to eligible employees.
Generally, all employees of Eltrax may participate in the plan and may authorize
payroll deductions of up to 10% of their earnings for the purchase of common
stock under the plan.

Unless otherwise determined by our board of directors, common stock is
purchased for accounts of employees participating in the plan at a price per
share equal to the lower of:

- 85% of the fair market value of a share of Eltrax common stock on the
relevant January 1st or July 1st (except for the initial offering); or

- 85% of the fair market value of a share of Eltrax common stock on the
following June 30th or December 31st.

Under the plan, Eltrax may specify offerings with a duration of not more
than six months. The first offering under the plan began on January 1, 2000 and
terminated on June 30, 2000. Thereafter, offerings generally will begin on each
subsequent July 1st and January 1st and continue for six months. Purchases will
occur each December 31st and June 30th. On the first day of an offering period,
Eltrax will grant to each eligible employee who has elected to participate in
the plan an option to purchase shares of common stock as follows: the employee
may authorize an amount (a whole percentage from 1% to 10% of the employee's
regular pay) to be deducted from his or her pay during the offering period. On
the last day of the offering period, the employee is deemed to have exercised
the option, at the option exercise price, to the extent of accumulated payroll
deductions. For this purpose, an employee's regular pay includes only his or her
straight time earnings.

If an employee is not a participant on the last day of the offering period,
the employee is not entitled to exercise any option, and the amount of the
employee's accumulated payroll deductions will be refunded. An employee's rights
under the plan terminate upon voluntary withdrawal from the plan at any time, or
when the employee ceases employment for any reason, except that upon termination
of employment because of death, disability or retirement, the employee or the
employee's beneficiary may exercise the option to purchase the shares that the
accumulated payroll deductions in the participant's account would purchase at
the date of death, disability or retirement.

Limitations

Eligible employees may be granted rights only if the rights, together with
any other rights granted under any other employee stock purchase plans, do not
permit the employee to purchase Eltrax common stock at a rate which exceeds
$25,000 of the fair market value of the stock for each calendar year in which
rights are outstanding.

Available Shares

Eltrax has reserved 1,000,000 shares of common stock for use under the
plan. The shares may be authorized but unissued shares or shares that have been
reacquired by Eltrax.

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<PAGE> 101

Administration

Eltrax's compensation committee administers the plan.

Withholding of Tax

Eltrax has the right to deduct any taxes required by law to be withheld as
a result of such disposition from any amounts otherwise payable then or at any
time thereafter to the employee. Eltrax also has the right to require a person
entitled to receive shares upon the exercise of an option to pay Eltrax in cash
the amount of any taxes that Eltrax is or will be required to withhold with
respect to the shares before the certificate for such shares is delivered under
the option.

APPROVAL BY STOCKHOLDERS

The plan will be adopted if stockholders owning a majority of shares of
Eltrax common stock represented at the meeting and entitled to vote on this
proposal vote in favor of it, provided that a quorum is present. Abstentions
will have the same effect as a vote against this proposal.

RECOMMENDATION OF THE BOARD OF DIRECTORS

Eltrax's board unanimously recommends a vote FOR the proposal to adopt the
1999 Employee Stock Purchase Plan. Proxies solicited by the board will be voted
"for" the plan proposal unless instructions to the contrary are given.

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<PAGE> 102

ADDITIONAL PROPOSALS FOR THE CEREUS ANNUAL MEETING

ELECTION OF DIRECTORS

Seven directors will be elected at the Cereus annual meeting to serve for
one-year terms beginning at the annual meeting and expiring at the 2001 annual
stockholders meeting or until their respective successors have been elected and
qualified. However, if the merger is completed, Cereus will become a
wholly-owned subsidiary of Eltrax and Cereus's board of directors may be
reconfigured and some of the directors elected at the annual meeting may not
serve on the board of directors after the merger.

It is proposed that these positions be filled by persons nominated to the
board of directors by management. Each director will be elected by the
affirmative vote of a plurality of the votes represented in person or by proxy
at the annual meeting. Proxies will be tabulated by Cereus's transfer agent. The
inspector of elections appointed at the annual meeting will then combine the
proxy votes with the votes cast at the annual meeting.

If any of the nominees is unavailable to serve for any reason, then a valid
proxy may be voted for the election of such other persons as the person or
persons voting the proxy may deem advisable in their best judgment. Management
has no present knowledge that any of the persons named will be unavailable to
serve. In any event, the enclosed proxy can be voted for only the seven nominees
named in this document or their substitutes.

CEREUS'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" EACH OF THE
NOMINEES NAMED BELOW. Proxies solicited by the board will be voted "for" the
nominees unless instructions to withhold or to the contrary are given.

<TABLE>
<CAPTION>
NOMINEE AGE POSITION
------- --- --------
<S> <C> <C>
Steven A. Odom..................................... 47 Chairman of the Board
and Chief Executive Officer
James M. Logsdon................................... 53 President, Chief Operating
Officer and Director
Juliet M. Reising.................................. 49 Executive Vice President,
Chief Financial Officer, Secretary,
Treasurer and Director
Max E. Bobbitt(1).................................. 55 Director
Gary H. Heck(1)(2)................................. 55 Director
Amy L. Newmark(2).................................. 42 Director
Joseph R. Wright, Jr.(1)........................... 61 Director
</TABLE>

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

(1) Member of the audit committee.

(2) Member of the compensation committee.

Information regarding the business experience of the directors is set forth
under the caption "The Merger Agreement -- Management and Boards of Directors
after the Merger" in this document. The information is based on information
furnished to us by each director.

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<PAGE> 103

EXECUTIVE OFFICERS

Cereus's executive officers, their ages and offices held, as of August 21,
2000, are as follows:

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Steven A. Odom....................... 47 Chairman of the Board and Chief Executive Officer
James M. Logsdon..................... 53 President, Chief Operating Officer and Director
Juliet M. Reising.................... 49 Executive Vice President, Chief Financial Officer,
Secretary, Treasurer and Director
Timothy J. Amidon.................... 43 Executive Vice President
William Boynes, Jr. ................. 32 Vice President -- Consulting Services
L. Joseph Artime..................... 45 Vice President -- Business Alliances
Michael D. Griffith.................. 38 Vice President -- Sales
Gordon Murray........................ 29 Vice President -- Marketing
Peyton H. Park....................... 38 Vice President -- Internet Strategy
K. Pramod Reddy...................... 28 Vice President -- Technology, Chief Technology Officer
Ronald Roswell, Jr. ................. 37 Vice President -- Business Development
Ronald Roswell, Sr. ................. 61 Vice President
</TABLE>

Timothy J. Amidon has served as the Executive Vice President of Cereus
since January 2000. Mr. Amidon was an independent merger and acquisition
consultant and private investor from 1990 until his service with Cereus. From
1983 until 1990, Mr. Amidon served with Mr. Odom at Data Contract Company, Inc.
as Executive Vice President and at the PCS Division of Executone as Director of
Operations and Administration. Mr. Amidon was a practicing certified public
accountant from 1983 through 1997.

William Boynes, Jr. has served as the Vice President -- Consulting Services
of Cereus since Cereus's acquisition of Client Server Solutions, Inc. in
November 1999. Mr. Boynes also served as a director and the Chief Operating
Officer of Cereus from November 1999 to January 2000. Previously, he had served
as the Chief Operating Officer and a founder of Client Server Solutions, which
began operations in January 1996. Mr. Boynes was formerly a Regional Consulting
Manager for Platinum Software Corporation from August 1993 to December 1995.
From May 1986 to July 1993 he was a business systems consulting manager for
Arthur Andersen & Co.

L. Joseph Artime has been the Vice President -- Business Alliances of
Cereus since November 1999. Previously, he had served as the Vice
President -- Latin American Business Development and a partner of Client Server
Solutions since September 1996. Prior thereto, Mr. Artime was an account
executive for Dun & Bradstreet software from May 1995 to June 1996 and before
that held several positions during his tenure with ADP, Inc. which included:
Director National Accounts from June 1993 to April 1995; Major Accounts Sales
Executive from July 1989 to June 1993; National Accounts Manager from July 1988
to June 1989; Regional Sales Executive from July 1987 to June 1988; and District
Manager from July 1985 to June 1987. Mr. Artime was a Key Account Representative
for Motorola from June 1981 to May 1985.

Michael D. Griffith has been the Vice President -- Sales of Cereus since
its acquisition of Client Server Solutions in November 1999. Previously, he had
served as the President and one of the founders of Client Server Solutions.
Prior thereto, he was the Eastern Region Channel Business Manager for Platinum
Software Corporation from January 1995 until January 1996. From February 1994
until January 1995 he served as Product Director and was responsible for all
reseller product initiatives for Collier Consulting, Inc.

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<PAGE> 104

Gordon Murray has served as Vice President of Marketing for Cereus since
March 2000. Mr. Murray was previously Director of Marketing for World Access,
Inc. and has developed and raised capital for several internet companies in
Atlanta, GA and Austin, TX. From 1995 through 1997 he held management positions
with SunGard Data Systems and Invesco.

Peyton H. Park, P.E. has served as Vice President -- Internet Strategy for
Cereus since August 1999. He previously served as the Executive Vice President
and Director of Operations of Reddy Group, Inc. and Cereus Bandwidth L.L.C. from
June 1997 until their acquisition by Cereus in July 1999. Mr. Park was formerly
a Manager and Senior Engineer with the consulting engineering firm, LawGibb
(formerly Law Companies).

K. Pramod Reddy has served as the Vice President and Chief Technology
Officer of Cereus since August 1999. Mr. Reddy also served as a director of
Cereus from August 1999 to January 2000. He had previously served as the
President of Reddy Group and Cereus Bandwidth from June 1997 until their
acquisition by Cereus in July 1999. From February 1993 to August 1996, Mr. Reddy
was a Project Engineer and Manager for LawGibb Group.

Ronald Roswell, Jr. has been the Vice President -- Business Development of
Cereus since August 1999 and was formerly President and founder of Enterprise
Solutions Group, Inc., which was formed in March 1996 and which was acquired by
Cereus in July 1999. Mr. Roswell also served as a director of Cereus from August
1999 to January 2000. In May 1993, Mr. Roswell formed Accounting Systems
Consultants, Inc., which was the predecessor company to ESG. Prior thereto, Mr.
Roswell was a controller for L'Angel Products, Inc. from July 1991 to May 1993
and he was an audit and tax specialist for Arthur Andersen & Co. from May 1985
to May 1991. He is a Certified Public Accountant and a Microsoft Certified
Professional.

Ronald Roswell, Sr. has been the Vice President of Cereus since August
1999. Since 1986, Mr. Roswell has been the President and owner of Shenhill
Enterprises, a financial consulting firm. From 1978 to 1986, Mr. Roswell was the
President and owner of BTU Insulation Co. and from 1969-1978 he held the
positions of Vice President, Treasurer and General Manager of Cox Enterprises,
Inc., a media company. Prior thereto, he was a Senior Accountant at the
accounting firm of Haskins and Sells from 1961 to 1969. He is a Certified Public
Accountant.

Information on the Board and its Committees

During 1999, Cereus's board of directors met two times. The board of
directors has established an audit committee and a compensation committee. The
board of directors does not have a nominating committee. No incumbent board
member attended fewer than 75% of the aggregate of (i) the total number of
meetings of the Board which such director was eligible to attend during 1999 and
(ii) the total number of meetings held by any committee of the Board upon which
such director served during 1999.

The audit committee is comprised of Messrs. Bobbitt, Heck and Wright. The
audit committee convenes when deemed appropriate or necessary by its members.
The primary functions of the audit committee are to: (i) recommend an accounting
firm to be appointed by Cereus as its independent auditors; (ii) consult with
Cereus's independent auditors regarding the audit plan; and (iii) determine that
management placed no restrictions on the scope or implementation of the
independent auditors' examination. The audit committee did not meet in 1999.

The compensation committee is comprised of Ms. Newmark and Mr. Heck. The
compensation committee: (i) sets and approves the compensation (including
salary, deferred compensation, bonuses, incentive compensation and all other
types of compensation or remuneration) of Cereus's executive officers; and (ii)
administers Cereus's 1997 Stock Option Plan. The compensation committee did not
meet in 1999.

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<PAGE> 105

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act requires Cereus's directors,
executive officers, and persons who own beneficially more than ten-percent of a
registered class of Cereus's equity securities, to file with the SEC initial
reports of ownership and reports of changes in ownership of such securities of
Cereus. Directors, executive officers and greater than ten percent stockholders
are required by SEC regulations to furnish Cereus with copies of all Section
16(a) reports they file.

The Cereus common stock was registered under Section 12(g) of the Exchange
Act on January 19, 2000. As such, Cereus's directors, executive officers and
greater than ten-percent beneficial owners had no Section 16(a) filing
requirements during the 1999 fiscal year.

DIRECTOR AND EXECUTIVE COMPENSATION

Director Compensation

Prior to January 2000, directors were not compensated for their services as
directors; however, they were reimbursed for all reasonable expenses incurred in
connection with their services. In January 2000, in an effort to attract and
retain experienced executives to serve as outside directors for Cereus, the
Cereus board of directors adopted the Outside Directors' Warrant Plan (the
"Warrant Plan").

The purposes of the Warrant Plan are to attract and retain the best
available personnel for service as directors of Cereus, to provide additional
incentive to the persons serving as directors of Cereus, to align director and
stockholder long-term interests and to encourage continued service on the board.
Warrants may be granted under the Warrant Plan only to directors of Cereus who
are neither employees of Cereus nor of any of its affiliates. The aggregate
number of shares of common stock authorized to be issued pursuant to the Warrant
Plan is 1,000,000, subject to adjustment in certain instances. The Warrant Plan
provides that each eligible non-employee director elected to serve as a director
of Cereus on or after January 1, 2000 may be granted, at the discretion of the
board of directors, warrants to purchase no more than 250,000 shares of common
stock in the aggregate. The initial exercise price of the warrants will be not
less than the fair market value of the common stock subject to the warrant on
the date of grant.

In January 2000, four new outside directors of Cereus, Ms. Newmark and
Messrs. Bobbitt, Heck and Wright, each received warrants entitling them to
purchase 150,000 shares of Cereus common stock on or prior to January 10, 2005
at an exercise price of $3.75 per share. These warrants vest at a rate of 50,000
shares per year commencing on the date of grant. At the time these warrants were
granted, the fair market value of the common stock was $3.75 per share.

In January 2000, the Cereus board of directors also adopted the Directors'
Warrant Incentive Plan (the "Incentive Plan") pursuant to which the board of
directors may grant to each director on an annual basis warrants to purchase up
to 50,000 shares of common stock at an exercise price per share equal to no less
than 110% of the fair market value of the common stock at the date of grant. No
warrants may be granted under the Incentive Plan in a given year unless Cereus's
common stock has appreciated by a compounded annual average rate of return in
excess of 35% for the applicable measurement period determined under the
Incentive Plan preceding the year of grant. The aggregate number of shares of
common stock authorized to be issued pursuant to the Incentive Plan is 1,000,000
subject to adjustment in certain instances. No warrants have been granted under
the Incentive Plan.

Warrants granted under the Warrant Plan and the Incentive Plan, once
vested, are exercisable in one or more installments and expire on the fifth
anniversary following the date of grant, provided that if the Director has not
attended at least 75% of the meetings of the Board for the year in which an
installment first becomes exercisable, then such installment may not be
exercised.

Notwithstanding the foregoing, the Warrant Plan and the Incentive Plan
provide that warrants awarded pursuant to these plans will become immediately
exercisable (i) if Cereus is to be consolidated with or acquired by another
entity in a merger; (ii) upon the sale of substantially all of Cereus's assets
or the sale of at least 90% of the outstanding common stock to a third party;
(iii) upon the merger or consolidation of Cereus with or into any other
corporation or the merger or consolidation of any corporation with or into
Cereus (in which consolidation or merger the stockholders of Cereus receive

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<PAGE> 106

distributions of cash or securities as a result thereof); or (iv) upon the
liquidation or dissolution of Cereus. Each of Ms. Newmark and Messrs. Bobbitt,
Heck and Wright has agreed that the merger with Eltrax will not accelerate the
exercisability of the warrants issued to them pursuant to the Warrant Plan.

Key Man Insurance

During January 1999, a 10 year level term life insurance policy was issued
by The Travelers Companies in the amount of $1,000,000 on the life of Mr. Arena,
who then served as Cereus's Chief Executive Officer. Cereus discontinued all key
man insurance policies in January 2000.

Stock Option Plans

In September 1997, Cereus's stockholders approved the adoption of Cereus's
1997 Stock Option Plan, which is administered by the Cereus board of directors,
and authorized a total of 250,000 shares of common stock for issuance under the
plan. The purpose of the stock option plan is to enable Cereus to attract and
retain competent personnel by offering them the opportunity to acquire a
proprietary interest in Cereus. On November 30, 1999, stockholders of Cereus
approved an increase in the number of shares of common stock authorized for
issuance under the stock option plan from 250,000 to 3,000,000 shares. The board
has also approved option grants for non-employee advisors. As of December 31,
1999, options for a total of 962,669 shares of common stock, exercisable at
prices ranging from $.90 to $4.75 per share, were outstanding.

Executive Compensation

The following table sets forth information concerning the compensation paid
or awarded to the only executive officer of Cereus required to be included
therein during each of the years ended December 31, 1997, 1998 and 1999. No
other executive officer of Cereus was paid in excess of $100,000 in salary and
bonus during 1999.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
SECURITIES
UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS COMPENSATION
--------------------------- ---- -------- ------ ---------- ------------
<S> <C> <C> <C> <C> <C>
Paul R. Arena............................. 1999 $160,400 $ 0 57,133 --
Chairman, CEO & President(1) 1998 110,000 8,000 -- --
1997 97,200 0 -- --
</TABLE>

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

(1) Mr. Arena was appointed Vice Chairman in January 2000. Previously, Mr. Arena
served as Chairman, CEO and President from March 1997 until January 2000.
Mr. Arena resigned as Vice Chairman in March 2000.

AGGREGATE OPTION EXERCISES AND YEAR-END OPTION VALUES

The following table sets forth information concerning the value of options
exercised by the executive officer named in the Summary Compensation Table above
during 1999 and the value at December 31, 1999 of unexercised options held by
him. The value of unexercised options reflects the increase in market

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<PAGE> 107

value of Cereus common stock from the date of grant through December 31, 1999,
when the closing price of Cereus common stock was $4.125 per share. Mr. Arena
did not exercise any options in 1999.

<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
OPTIONS AT FISCAL YEAR END OPTIONS AT FISCAL YEAR END(1)
--------------------------- ------------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ------------ --------------
<S> <C> <C> <C> <C>
Paul R. Arena................................ 19,167 91,311 $46,063 $74,992
</TABLE>

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

(1) "In-the-Money" options are options with an exercise price less than $4.125
per share, the closing price of Cereus common stock at December 31, 1999.

OPTION GRANT TABLE

The following table sets forth, for the executive officer named in the
Summary Compensation Table above, information regarding the grant of stock
options during the year ended December 31, 1999.

<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
SHARES % OF ANNUAL RATES OF STOCK
UNDERLYING TOTAL OPTIONS PRICE APPRECIATION FOR
OPTIONS GRANTED TO DATE OPTION TERM(4)
GRANTED IN EMPLOYEES IN EXERCISE OPTIONS ----------------------
NAME 1999(1) 1999(2) PRICE(3) EXPIRE 5% 10%
---- ---------- ------------- -------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Paul R. Arena................. 25,000 4% 4.75 7/30/09 $74,750 $189,250
Paul R. Arena................. 32,133 5 3.75 12/28/04 75,834 192,155
</TABLE>

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

(1) The options are non-qualified stock options granted on July 30, 1999 and
December 28, 1999 under Cereus's 1997 Stock Option Plan that become
exercisable cumulatively as to 25%, 50%, 75% and 100% after the first,
second, third and fourth anniversaries, respectively, after the date of
grant.

(2) Based on options for a total of 633,333 shares granted to all directors,
officers and employees.

(3) The exercise price is equal to the fair market value on the date of grant of
the option.

(4) The 5% and 10% appreciation rates are set forth in the SEC rules and no
representation is made that the common stock will appreciate at these
assumed rates or at all.

Employment Agreements

Cereus has entered into an Executive Employment Agreement with Mr. Odom
effective as of January 10, 2000, pursuant to which Mr. Odom has agreed to serve
as the Chief Executive Officer of Cereus for a term of three years. The
agreement provides for: (i) a term which will be automatically renewed for an
additional one year term unless either party gives notice to the other of its
intention not to so renew at least 90 days' prior to the termination of the
then-current term; (ii) the payment of a specified base salary and an annual
bonus in the discretion of the board of directors of Cereus; (iii) a prohibition
against Mr. Odom's disclosure of confidential information for a period of two
years following termination; and (iv) continuation of Mr. Odom's salary and the
benefits for the 24 months following his termination by Cereus without cause or
by him for good reason.

Cereus has entered into an Executive Employment Agreement with Ms. Reising
effective as of March 23, 2000, pursuant to which Ms. Reising has agreed to
serve as an Executive Vice President and Chief Financial Officer of Cereus for a
term of three years. The agreement provides for: (i) a term which will be
automatically renewed for an additional one year term unless either party gives
notice to the other of its intention not to so renew at least 90 days' prior to
the termination of the then-current term; (ii) the payment of a specified base
salary and an annual bonus in the discretion of the board of directors of
Cereus; (iii) a prohibition against Ms. Reising's disclosure of confidential
information for a period of two years following termination; and (iv)
continuation of Ms. Reising's salary and the benefits for the 24 months
following her termination by Cereus without cause or by her for good reason.

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<PAGE> 108

Cereus has entered into an Executive Employment Agreement with Mr. Logsdon
effective as of January 10, 2000, pursuant to which Mr. Logsdon has agreed to
serve as the President and Chief Operating Officer of Cereus for a term of three
years. The agreement provides for: (i) a term which will be automatically
renewed for an additional one year term unless either party gives notice to the
other of its intention not to so renew at least 90 days' prior to the
termination of the then-current term; (ii) the payment of a specified base
salary and an annual bonus in the discretion of the board of directors of
Cereus; (iii) a prohibition against Mr. Logsdon's disclosure of confidential
information for a period of two years following termination; and (iv)
continuation of Mr. Logsdon's salary and the benefits for the 24 months
following his termination by Cereus without cause or by him for good reason.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Based upon information available to Cereus, the following table shows, as
of August 28, 2000, the shareholdings of:

- each person known to Cereus to be the beneficial owner of more than 5% of
Cereus common stock;

- each of Cereus's directors;

- each executive officer listed in Cereus's Summary Compensation Table; and

- all of Cereus's executive officers and directors as a group.

<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED(1)
----------------------
NAME NUMBER PERCENT(2)
---- --------- ----------
<S> <C> <C>
Steven A. Odom(3)........................................... 791,250 7.5%
Juliet M. Reising(4)........................................ 315,000 3.1
Amy L. Newmark(5)........................................... 250,000 2.5
James M. Logsdon(6)......................................... 215,000 2.1
Joseph W. Wright, Jr.(7).................................... 104,207 1.1
Gary H. Heck(8)............................................. 75,000 *
Max E. Bobbitt(9)........................................... 50,000 *
Paul R. Arena(10)........................................... 286,690 2.9
All executive officers and directors as a group(16
persons)(11).............................................. 3,745,980 35.1
</TABLE>

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

* Less than 1% of the issued and outstanding shares of common stock.

(1) Unless otherwise noted, all of the shares shown are held by individuals or
entities possessing sole voting and investment power with respect to such
shares. Shares not outstanding but deemed beneficially owned by virtue of
the right of a person or member of a group to acquire them within 60 days
of August 28, 2000 are treated as outstanding only when determining the
amount and percentage owned by such individual or group.

(2) In accordance with SEC regulations, the percentage calculations are based
on 9,802,049 shares of common stock issued and outstanding as of August 28,
2000 plus shares of common stock which may be acquired within 60 days of
August 28, 2000 by each individual or group listed.

(3) Includes options or warrants to acquire 711,250 shares exercisable within
60 days of August 28, 2000. Mr. Odom's address is 1000 Abernathy Road,
Suite 1000, Atlanta, Georgia 30328.

(4) Includes options or warrants to acquire 282,500 shares exercisable within
60 days of August 28, 2000.

(5) Includes options or warrants to acquire 150,000 shares exercisable within
60 days of August 28, 2000.

(6) Includes options or warrants to acquire 207,500 shares exercisable within
60 days of August 28, 2000.

(7) Includes options or warrants to acquire 50,000 shares exercisable within 60
days of August 28, 2000.

(8) Includes options or warrants to acquire 62,500 shares exercisable within 60
days of August 28, 2000.

(9) Includes options or warrants to acquire 50,000 shares exercisable within 60
days of August 28, 2000.

(10) Includes options or warrants to acquire 32,500 shares exercisable within 60
days of August 28, 2000.

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<PAGE> 109

(11) Includes options or warrants to acquire 1,769,274 shares exercisable within
60 days of August 28, 2000.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On March 3, 1999, Cereus issued a promissory note in the amount of $100,000
to Dr. Audrey L. Braswell, who then served as a director of Cereus. The loan was
ratified by the board of directors on March 26, 1999 and consisted of an
unsecured note with the principal balance and interest due on May 15, 1999 in
the amount of $106,000. The loan was repaid during the second quarter of 1999.

During the second quarter of 1999, each of the three holders of Cereus's
Series A Convertible Promissory Notes exercised an option to convert a portion
of their notes into common stock at a conversion price of $2.10 per share. On
June 22, 1999, Dr. Braswell, one of the holders, who then served as a director
of Cereus, converted $150,000 principal amount of his note into common stock
resulting in the issuance by Cereus of 71,429 shares and a reduction in the
principal amount of his note from $300,000 to $150,000. The effect of the three
conversions was to reduce the principal amount of the outstanding Series A
Convertible Promissory Notes from $1,050,000 to $600,000.

On July 30, 1999, Cereus acquired all the outstanding capital stock of
Enterprise Solutions Group, Inc. for a total purchase price of $3,024,000
(inclusive of acquisition costs), consisting of $550,000 in cash, a promissory
note in the principal amount of $250,000, which bears interest at 3% per annum,
and 383,333 shares of common stock valued at $5.06 per share, with 191,666 of
those shares being held in escrow and scheduled to be distributed to the extent
of 50% on July 30, 2000 and 50% on July 30, 2001. In the first quarter of 2000,
this note was cancelled and replaced by the issuance of 50,000 shares of common
stock at $5.00 per share and 50,000 warrants with an exercise price of $10.00
per share. Ronald Roswell, Jr. was the President, founder and a principal
stockholder of Enterprise Solutions Group. Mr. Roswell now serves as Vice
President -- Business Development of Cereus and served as a director of Cereus
from July 1999 to January 2000.

On July 30, 1999, Cereus acquired all the outstanding capital stock of
Reddy Group, Inc., together with its affiliate Cereus Bandwidth, L.L.C. The
total purchase price was $2,965,000 (inclusive of acquisition costs), consisting
of $1,000,000 in cash and the issuance of 333,333 shares of common stock valued
at $5.06 per share, with such shares held in escrow and scheduled to be
distributed to the extent of 50% on July 30, 2000 and 50% on July 30, 2001. K.
Pramod Reddy was the President, founder and a principal stockholder of the
acquired companies. He now serves as the Chief Technology Officer and Vice
President of Cereus and served as a director of Cereus from July 1999 to January
2000.

On November 15, 1999, Cereus acquired all the outstanding capital stock of
Client Server Solutions and its affiliate, CSS Financial Software Sales, Inc.
The purchase price of $5,134,000 (inclusive of acquisition costs, net of notes
receivable issued to the selling shareholders) was comprised of (i) $400,000 in
cash; (ii) 983,333 shares of common stock of Cereus, including 150,000 shares
held in escrow, valued at $4.50 per share; and (iii) promissory notes in the
amount of $1,325,000 bearing interest at 8% per annum. In the first quarter of
2000, $300,000 in principal amount of the promissory notes was converted into
60,000 shares of common stock at $5.00 per share and warrants to acquire 60,000
shares of common stock at an exercise price of $10.00 per share. Michael
Griffith, William Boynes, Jr. and L. Joseph Artime were the President, Chief
Operating Officer and Vice President, respectively, of the acquired companies
and were the principal shareholders of the acquired companies. Messrs. Griffith,
Boynes and Artime are now the Vice President -- Sales, Vice President Consulting
Services and Vice President -- Business Alliances, respectively, of Cereus.

During January 2000, Cereus issued 15% Convertible Subordinated Notes to
Steven A. Odom, Chairman and Chief Executive Officer of Cereus, and Timothy J.
Amidon, an officer of Cereus, in the amounts of $150,000 and $200,000,
respectively. In February 2000, Mr. Odom's converted his note into 40,000 shares
of common stock, and in January 2000, Mr. Amidon's converted his note into
53,333 shares of common stock in accordance with the terms of the notes.

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In March 2000, the $600,000 of convertible notes still outstanding at
December 31,1999 were converted to common stock pursuant to their original
terms. Paul R. Arena, who served as Cereus's Chairman, President and Chief
Executive Officer from March 1997 until January 2000, held $150,000 of these
notes.

In April 2000, Cereus sold its mineral operations to Arena Acquisition
Corp., a recently formed Delaware corporation owned by Mr. Arena. The sale was
made pursuant to a stock purchase agreement with Arena Acquisition dated as of
March 31, 2000. In connection with the execution of the stock purchase
agreement, Mr. Arena resigned from Cereus's board of directors effective as of
March 31, 2000, and Cereus and Mr. Arena agreed to indemnify each other for
certain matters. Pursuant to the stock purchase agreement, Cereus sold to Arena
Acquisition all of the stock of the subsidiaries comprising Cereus's mineral
operations for approximately $1.0 million payable by means of a 180 day
promissory note. The note is secured by shares of the subsidiaries sold to Arena
Acquisition pursuant to the stock purchase agreement and 84,762 shares of Cereus
common stock held by Mr. Arena. At the closing of the transaction, Cereus and
Mr. Arena also entered into a consulting agreement pursuant to which Mr. Arena
provides certain consulting services to Cereus up to eight hours per calendar
month at times reasonably requested by Cereus and Cereus granted to Mr. Arena a
warrant to purchase an aggregate of 50,000 shares of Cereus common stock. The
warrant has an exercise price per share equal to the fair market value of the
common stock on the day immediately preceding the execution of the consulting
agreement and becomes exercisable at the rate of 25% upon each three month
anniversary of the closing.

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ADDITIONAL INFORMATION ABOUT ELTRAX

BUSINESS OF ELTRAX

Eltrax, a Minnesota corporation, is a provider of outsourced information
technology solutions. Eltrax operates through two separate business units: the
technology services group and the hospitality services group. The technology
services group provides technology solutions, customer care services and acts as
an application service provider. The hospitality services group provides
enterprise information solutions for the global hospitality industry. Eltrax is
exploring various alternatives to further its strategy of expanding its
penetration of the network, application and ASP markets. As part of this
process, Eltrax is pursuing the disposition of its hospitality services group.
As such, Eltrax has begun accounting for the hospitality services group as a
discontinued operation and Eltrax's historical results of operations, which are
the result of its old business strategy, may not give you an accurate indication
of how Eltrax will perform in the future.

Technology Services Group

The technology services group is a provider of outsourced Internet- and
network-based applications and services to over 3,000 clients. Clients are
typically small- and medium-sized enterprises with revenue of $50 million to $1
billion where outsourced IT solutions provide a cost-effective alternative to
developing and maintaining internal technology infrastructures. The technology
services group is comprised of three divisions:

- Technology Solutions. Provides comprehensive solutions, such as strategic
assessment, application and network design, custom application
development and integration, network management, support and maintenance
that enable clients to more effectively communicate and manage
information.

- Customer Care Solutions. Simplifies the technical support functions of
clients by providing 24x7 help desk support and training and installation
services for the solutions that Eltrax has developed and implemented.

- Application Service Provider. Provides clients with application
outsourcing and remote delivery of applications that lower total
technology-related costs and infrastructure requirements. Eltrax's
existing core competencies within the IT outsourcing marketplace and
large customer base have allowed Eltrax to more rapidly introduce its ASP
offerings.

Hospitality Services Group

The hospitality services group designs, manufactures, markets and services
enterprise information products and services for the global hospitality
industry. These products and services consist of application-specific software
and hardware systems, supplemented by training, installation, maintenance and
call center support services. The hospitality services group concentrates on
three major areas: restaurant solutions, lodging solutions and energy management
solutions. In addition to Eltrax's software enterprise products and services and
hardware products, Eltrax offers a wide variety of support services and products
for its hotel and restaurant information systems. Eltrax also offers training,
installation, call center support and maintenance contracts for all hospitality
products.

Recent Developments

For the quarter ended March 31, 2000, Eltrax was not in compliance with the
cumulative net cash flow covenant in the PNC Bank facility. Eltrax did not
achieve the net cash flow required by the covenant because of accelerated
investment in the operations and infrastructure of the technology services group
and lower than expected revenues from the hospitality services group during the
quarter, primarily due to a change in customer purchasing patterns resulting
from the Y2K transition and a decline in international sales to the strong U.S.
dollar. Eltrax's accelerated investment in the technology services group
resulted from the closing of a private placement during the first quarter in
which Eltrax raised $13.0 million. On

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May 15, 2000, PNC Bank waived the non-compliance. In connection with the waiver
and the amendment described below, Eltrax paid PNC Bank a fee of $250,000.

Because the net cash flow covenant is cumulative, and because of continued
softness in revenues of the hospitality services group in the second quarter,
Eltrax was not in compliance with the covenant for the quarter ended June 30,
2000. In addition, Eltrax was not in compliance with a covenant regarding year
2000 capital expenditures and a covenant regarding maximum rental payments under
lease arrangements. On July 27, 2000 PNC Bank waived the non-compliance with
each of these covenants. Also on July 27, 2000, PNC Bank modified the covenants
regarding capital expenditures and rental payments for the balance of fiscal
year 2000. In connection with the waiver, Eltrax issued PNC Bank warrants to
purchase 12,532 shares of Eltrax common stock with certain registration rights.
Eltrax expects to obtain a modification to the net cash flow covenant that
contemplates the planned disposition of hospitality services group and the
funding of an additional $5 million under the existing bridge facility between
Eltrax and Cereus.

On June 29, 2000 Eltrax announced that as part of its effort to prepare for
the merger, it had reorganized operations and eliminated approximately 100
positions held by employees, as well as most positions held by contract
professionals. As a result of these actions, Eltrax expects to record
restructuring costs of approximately $1.5 million in the second quarter. Eltrax
expects the reduction in force, along with other cost reduction initiatives
implemented in the second quarter, will result in approximately $12.0 million in
annualized cash savings.

On June 29, 2000, Eltrax sold 180,000 shares of its common stock in a
private placement to an investor for aggregate cash consideration of $990,000.

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ADDITIONAL INFORMATION ABOUT CEREUS

BUSINESS OF CEREUS

Overview

In July 1999, Cereus (formerly known as AIM Group, Inc.) adopted a new
business strategy to provide business application software and services through
traditional delivery methods and Web based delivery methods. To execute this new
strategy, Cereus acquired three business in 1999:

- Enterprise Solutions Group, Inc. ("ESG");

- The Reddy Group, Inc. and its affiliate Cereus Bandwidth, L.L.C.
(collectively, "Cereus Bandwidth"); and

- Client Server Solutions, Inc. and its affiliate CSS Financial Software
Sales, Inc. (collectively, "CSS").

In the first quarter of 2000, Cereus recruited a new executive management
team, appointed a new board of directors and changed its strategic direction.
The new management team made the decision to transform Cereus from an enterprise
resource planning ("ERP"), applications implementation and consulting business
to a Web integration and ASP business. This new strategy focuses on Web
integration services for a suite of business software products as well as
hosting that software remotely with access through the Internet. These services
are designed to allow small to medium-sized companies, with annual sales from
approximately $25 million to $500 million, to outsource much of their business
software needs and IT requirements via Internet connectivity. Cereus also plans
to aggressively pursue the acquisition of other businesses engaged in
Internet-related business software solutions.

Prior to July 1999, Cereus's business also consisted of certain mining and
mineral operations that have since been discontinued. Cereus sold these
operations to a company owned by Paul R. Arena, Cereus's former Chairman of the
Board, President and Chief Executive Officer, in April 2000.

Since July 1999, Cereus has been engaged through its acquired businesses in
the development and marketing of ASP solutions, Web integration and other IT
business application software and consulting services to small and medium-sized
companies. The operations of the acquired businesses have been consolidated but
operate as separate divisions within Cereus for marketing purposes. These
divisions comprise Cereus's business and are described below.

- Cereus Bandwidth. The Cereus Bandwidth division primarily provides ISP
and related Internet consulting services to small and medium-sized
businesses. This division also markets its Internet access services to
the "small building," combined office and hotel and conference room
markets. Cereus's ISP revenues from this division are primarily derived
from monthly subscription fees charged to customers for services
rendered. ISP Subscriber Agreements entered into by Cereus through this
division with its subscribers are terminable by the subscriber. Cereus
acquired Cereus Bandwidth in July 1999. Cereus Bandwidth was based in
Atlanta, Georgia and commenced operations in 1996.

- ESG. The ESG division is primarily engaged in the marketing and sale of
ERP products, including payroll and human resource software products.
Cereus's revenues are primarily derived from the sale of software
products, as well as fees paid by its customers for its consulting
services. The ESG division's business is dependent upon its agreements
with four software publishers whose products it sells, and such
agreements are terminable by such software publishers upon 30 days prior
notice. Cereus acquired ESG in July 1999. ESG was based in West Palm
Beach, Florida and commenced operations in March 1996.

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Cereus, through the ESG division, is a certified "value added reseller"
("VAR") for a number of prominent software houses. Its clients include
health care, transportation, distribution, service, international and
charitable organizations.

- CSS. The CSS division provides computer consulting services to small and
medium sized businesses in the eastern U.S. and to a much lesser extent
in certain foreign markets. The CSS division (i) develops customized
financial, administrative, distribution, point-of-sale and inventory
management software and provides related data base management and other
computer consulting services; and (ii) resells, as a VAR, packaged
accounting and project management software products. The CSS division's
most significant source of packaged software products in 1999 was Epicor
Software Corporation (formerly Platinum Software Corporation). The CSS
division is dependent upon its agreements with approximately five
publishers of packaged software products, whose agreements may be
terminated upon 30 days prior notice. The CSS division specializes in the
resale of Epicor (formerly Platinum) financial management software
products, development services and electronic commerce. The CSS division
provides its clients with options for software implementation, consulting
and development services, including system selection and screening,
application development, project management and professional services,
business analysis and development of system requirements, and Web-based
application development. Included in the CSS division's staffing are
specialists with the knowledge base to solve growing business
requirements. Cereus acquired CSS in November 1999. CSS was formed in
1996 and had offices in Atlanta, Georgia and Miami and Tampa, Florida.

The CSS division emphasizes the furnishing of consulting services to, and
servicing of, small to medium sized organizations as well as reselling
packaged accounting and project management software solutions. The CSS
division is currently represented with offices and home-based consultants
in major cities across the nation, including Atlanta, Dallas, Fort
Lauderdale, Hartford, Miami, Raleigh and Tampa.

Consolidation of Acquired Companies and Business Strategy

Cereus's business strategy is to focus the business on Web integration
services and application service provisioning to small and medium-sized
companies (annual sales from approximately $25 million to $500 million), serving
as a single-source, Web application service provider with expertise in ASP, IT
strategy, Internet application and development services, business-to-business
e-commerce and training as well as the legacy ERP software.

Cereus's near term goals are to (i) ensure that all services and programs
of the three acquired companies continue on a scheduled course so Cereus
continues to meet its contractual obligations; and (ii) integrate the three
technology organizations in order to focus on the new long-term strategy.

Cereus believes it is well-positioned to participate in the expanding
business of providing ASP services. ASP services make it possible for clients to
access and use leading software packages without all of the costs of owning and
managing the IT infrastructure that would otherwise be required. American
business is undergoing a major change in how corporate software is purchased and
used. Customers now desire the latest software applications to gain a
competitive edge, but do not have the technical and financial resources to
support such complex expansion. Many companies, particularly in the middle
market, seek service organizations that will provide a transition path, both
economically and structurally, to achieve these goals. These customers now find
the ASP business solution acceptable due to three converging trends: (i) the
mass adoption of the Internet as a viable and secure information transmission
medium; (ii) increased server processing power; and (iii) easier access to
complex application server software.

Today, high quality software is available via real-time access from
centrally hosted data centers where rentable software is accessed over
high-speed networks for the Internet. As opposed to the old practice in which
corporate software was purchased and managed internally, the new ASP environment
permits outsourcing, via the Internet, of corporate software that is leased.
Cereus believes that customers using ASP services should experience increased
efficiencies as well as significant cost savings due to the

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reduction of internal IT staffing, computer hardware capital expenditure and
network connections as well as the ability to lease only those modules that are
applicable to the customer's business operations.

Cereus emphasizes customer training in connection with its marketing of IT
services. Cereus's current customer training curriculum, which focuses primarily
on business software applications, also educates clients on the opportunities
available utilizing Internet-related technology as well as new Internet
applications available to support their software and general business practices.
Cereus has introduced an ASP program consisting of a wide range of business
applications software and Internet solutions. Under the program, companies will
be able to lease both business software applications as well as Internet
capabilities. Cereus's plan is to create a total solution which allows customers
to rent or lease application services. Cereus currently operates a National Data
Center located in Atlanta, Georgia. This facility supports the ongoing services
for its business applications and Internet business units. The National Data
Center is operational seven days a week, 24 hours a day and has the ability to
host database structures of all sizes as well as provide redundancy for those
organizations seeking secure data backup. Cereus has high-speed communications
capabilities in place for its customers. In order for Cereus to be able to
furnish a broad range of services and products to its customers, it has
initiated new alliance partnerships with major business application software
publishers. Lawson Software recently selected Cereus to represent its product
lines in the southeast as well as selected U.S. cities. Acuity Financial
Software, a business application software of the Sage Group, provides to Cereus
an additional offering of financial and project management software that
addresses specific needs of current and future customers. Cereus has entered
into a marketing alliance with Firstwave Technologies, Inc., pursuant to which
Cereus markets that company's Web-based relationship management applications and
hosting, consulting and integration services. Cereus's distribution agreement
with Clarus Corporation provides Cereus' customers with a Web-based procurement
solution.

In addition to the above business application software alliances, Cereus
plans to continue to build upon strategic relationships previously established
by the companies that Cereus recently acquired. For example, IBM Corporation has
selected Cereus to be a testing partner for a range of hardware products. The
role of Cereus has been to test new IBM products for functional viability and
usage by the to-be-targeted end-user group. In addition, Cereus was designated
as a Microsoft Solution Provider, a status achieved through a strict process of
technical testing and resource staffing. It is the goal of Cereus to expand
these strategic relationships as well as create new business partnerships to
enhance its service and product capabilities.

COMPETITION

The Internet-related and IT services market is very competitive and the
number of competitors is rapidly increasing. The substantial growth and
potential size of the Internet market have attracted many start-ups as well as
expansion of existing businesses in many industries. In the market for
Internet-enabled application software and network solutions, Cereus competes on
the basis of performance, price, software functionality and overall network
design. Potential competitors include certain of the "big five" accounting firms
and previously affiliated consulting firms, systems consulting and
implementation firms, service groups of computer equipment companies, facilities
management companies, general management consulting firms and programming
companies.

Cereus believes that the breadth of its services and capabilities and focus
on small to medium-sized business customers results in a favorable competitive
position. For example, Cereus is able to perform the complete set of services
required for enabling e-business, which includes strategic management and IT
consulting, enterprise applications, enterprise and network integration,
application hosting and custom business solutions.

EMPLOYEES

At June 27, 2000, Cereus had a total of nine full-time employees in its
Internet and business solutions software business, including 13 sales and
marketing personnel, 26 software consultants representatives,

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25 programmers and developers and 16 general, administrative and financial
personnel. In addition, as of that date, Cereus retained three
programmers/developers/consultants under contract. None of Cereus's employees is
covered by collective bargaining agreements.

PROPERTIES

In September 1999, Cereus relocated its executive offices to 6,000 square
feet of space leased in an office building located in Atlanta, Georgia at an
annual rental of $173,750 under a lease expiring on December 31, 2004.

On January 1, 2000, Cereus entered into a new lease for 8,000 additional
square feet in the above-referenced office building in Atlanta, Georgia for an
annual rental of $220,800 under a lease expiring December 31, 2004. Cereus also
leases 3,300 square feet of office space in West Palm Beach, Florida at an
annual rental of $68,000 under a lease expiring in May 2004.

Cereus also leases executive suites in Tampa and Fort Lauderdale, Florida
on a month to month basis. The monthly rental rate for each of these leases is
approximately $500.

Additionally, Cereus is obligated under the remaining term of the CSS
lease, which obligates Cereus to pay approximately $49,000 in 2000 and $12,000
in 2001.

In the opinion of management of Cereus, its properties are adequately
covered by insurance and are adequate for its immediate needs and that
additional or substitute space is available to accommodate growth and expansion.

LEGAL PROCEEDINGS

From time to time, Cereus is involved in various legal proceedings relating
to claims arising in the ordinary course of its business. Neither Cereus nor any
of its subsidiaries is a party to any such legal proceeding, the outcome of
which, individually or in the aggregate, is expected to have a material adverse
affect on Cereus's financial condition or results of operations.

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CEREUS'S MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

The following table sets forth for the periods indicated the amount of
certain items included in Cereus's Statement of Operations:

<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31,
------------------------- ------------------------
2000 1999 1999 1998
------------ ---------- ----------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C>
Net sales.................................. $ 3,574,154 $ -- $ 1,695,853 $ --
Cost of sales.............................. 3,144,621 -- 1,935,121 --
Loss on contractual services............... 250,000 -- -- --
------------ ---------- ----------- ----------
Gross (loss) income.............. 179,533 -- (239,268) --
------------ ---------- ----------- ----------
Selling, general, and administrative
expenses:
Sales and marketing expenses............. 903,916 -- 212,794 --
General and administrative expenses...... 1,939,630 -- 703,855 --
Stock compensation expense............... 2,398,978 -- 1,063,300 --
Impairment charge........................ 5,637,401 -- -- --
Depreciation and amortization............ 120,212 -- 44,303 --
Goodwill amortization.................... 613,404 -- 680,833 --
------------ ---------- ----------- ----------
Total selling, general and
administrative expenses........ 11,613,541 -- 2,705,085 --
------------ ---------- ----------- ----------
Operating loss............................. (11,434,008) -- (2,944,353) --
Interest (expense)/income, net............. 299,567 -- (513,242) --
------------ ---------- ----------- ----------
Loss from continuing operations before
income taxes and extraordinary item... (11,134,441) -- (3,457,595) --
Income tax................................. -- -- -- --
Loss from continuing operations before
extraordinary item.................... (11,134,441) -- (3,457,595) --
------------ ---------- ----------- ----------
Discontinued operations:
Loss from discontinued operations........ -- (398,294) (239,957) (351,606)
Loss on disposal of discontinued
operations............................ (236,000) -- (3,486,297) --
------------ ---------- ----------- ----------
Loss before extraordinary item........... (11,370,441) (398,294) (7,183,849) (351,606)
------------ ---------- ----------- ----------
Extraordinary Item:
Loss from debt conversion................ (7,187,500) -- -- --
------------ ---------- ----------- ----------
Net Loss......................... $(18,557,941) $ (398,294) $(7,183,849) $ (351,606)
============ ========== =========== ==========
Loss per share-basic and diluted:
Loss before discontinued operations and
extraordinary item.................... $ (1.41) $ -- $ (1.57) $ --
Discontinued operations.................. (0.03) (0.28) (1.69) (0.27)
Imputed noncash preferred stock
dividend.............................. -- -- -- (0.05)
------------ ---------- ----------- ----------
Loss before extraordinary item........... (1.44) (0.28) (3.26) (0.32)
Loss from debt conversion................ (0.91) -- -- --
------------ ---------- ----------- ----------
Loss available to common shares.......... $ (2.36) $ (0.28) $ (3.26) $ (0.32)
============ ========== =========== ==========
Weighted average common shares
outstanding.............................. 7,876,377 1,404,603 2,198,690 1,325,016
============ ========== =========== ==========
</TABLE>

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Six Months Ended June 30, 2000 Compared to Six Months Ended June 30, 1999

The results from continuing operations for the six months ended June 30,
2000 were derived from operations of the three businesses acquired in 1999 (the
"Acquired Businesses"), Cereus Bandwidth (acquired in July 1999), ESG (acquired
in July 1999) and CSS (acquired in November 1999). Cereus decided to discontinue
its mining and mineral operations in the fourth quarter of 1999 and completed
the sale of these operations in April 2000.

Net revenues of approximately $1,983,000 and $3,574,000 for the quarter and
six months ended June 30, 2000, respectively, were derived principally from
sales of software, consulting and development fees and internet service fees.

Cost of revenues of approximately $1,711,000 and $3,145,000 for the quarter
and six months ended June 30, 2000, respectively, primarily reflect the cost of
software products and consulting, development and other direct labor costs.

A loss on contractual services of approximately $250,000 was recognized in
the first quarter 2000, related to software purchase commitments entered into
which Cereus does not expect to use due to the repositioning of its business to
focus on business-to-business e-commerce. The loss was recognized based on
management's evaluation that little or no future economic benefits will result
from these commitments given the repositioning of the business.

Sales and marketing costs of approximately $588,000 and $904,000 for the
quarter and six months ended June 30, 2000, respectively, relate primarily to
cost of sales, marketing and business development personnel, including
commissions as well as travel and marketing campaign expenses.

General and administrative expenses of approximately $1,201,000 and
$1,940,000 for the quarter and six months ended June 30, 2000, respectively,
primarily relate to personnel expenses, professional services, travel expenses
and other overhead costs.

Stock compensation of approximately $126,000 for the quarter ended June 30,
2000 represents non-cash charges related to the accelerated vesting of stock
options for terminated employees due to the proposed merger between Cereus and
Eltrax. Stock compensation of approximately $2,399,000 for the six months ended
June 30, 2000 also includes non-cash charges related to the issuance of common
stock and warrants to employees and consultants during the quarter ended March
31, 2000.

Impairment charges of approximately $5,637,000 relate to the write-down of
goodwill associated with two of Cereus's acquisitions in 1999, CSS and ESG, each
of which was principally an ERP software sales and implementation business. As a
result of the new management team repositioning and restructuring Cereus's
business model, management's analysis indicated impairment in the goodwill
valuation associated with these acquisitions of approximately $5,637,000.

Goodwill amortization of approximately $307,000 and $613,000 reflects the
amortization expense for the quarter and six months ended June 30, 2000,
respectively, related to the goodwill associated with the Acquired Businesses
(as adjusted in the first quarter 2000 for the impairment valuation discussed
above).

Net interest income of approximately $247,000 and $300,000 for the quarter
and six months ended June 30, 2000, respectively, reflects interest income
earned on the proceeds of approximately $19,242,000 from Cereus's February 2000
private equity placement, net of interest expense on debt outstanding and net of
approximately $73,000 of debt discount amortization expense. The discount
related to the subordinated notes issued in 1999, which were converted to equity
in the first quarter 2000.

Loss from discontinued operations of approximately $89,000 and $398,000 for
the quarter and six months ended June 30, 1999 represent the losses for the
mineral operations for those periods.

Loss on disposal of discontinued operations of approximately $236,000 for
the six months ended June 30, 2000 reflects an adjustment to the write-down of
the book value of the mining companies that was recorded in the fourth quarter
of 1999. The write-down reflects the reduction in carrying value of net

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assets to fair market value plus an additional accrual for severance and
transaction costs associated with its disposition of these companies.

The loss from debt conversion in the six months ended June 30, 2000 of
approximately $7,188,000 relates to the conversion of approximately $2,075,000
in debt to equity (a combination of common stock and warrants) which conversion
occurred in the first quarter, 2000.

Year Ended December 31, 1999 compared to Year Ended 1998

The results from continuing operations for 1999 were derived from the
operations of the Acquired Businesses.

Revenues of approximately $1,696,000 for 1999 were derived principally from
sales of software, consulting and development fees and Internet service fees.

Cost of sales of approximately $1,935,000 for 1999 primarily reflect the
cost of software products and consulting, development and other direct labor
costs associated with the 1999 revenue.

Sales and marketing costs of approximately $213,000 for 1999 relate
primarily to cost of sales, marketing and business development personnel,
including commissions as well as travel and marketing campaign expenses.

General and administrative fees for 1999 of approximately $704,000
primarily relate to payroll expenses, professional services fees, travel
expenses, bad debt expenses and other overhead costs.

Stock compensation expense of approximately $1,063,000 in 1999 represents
non-cash charges related to the granting of stock options and warrants to
employees and others during 1999 and related shares issued to employees as part
of an acquisition.

Amortization of goodwill of approximately $681,000 reflects the
amortization expense for 1999 related to the goodwill associated with the three
acquisitions during 1999.

Interest expense of approximately $513,000 for 1999 includes approximately
$373,000 of amortization expense related to the discount on the Subordinate
Notes issued in 1999.

Loss from discontinued operations of approximately $240,000 for 1999 and
$352,000 for 1998 represent the losses for the mineral operations for those
respective periods.

Loss on disposal of discontinued operations of approximately $3,486,000 in
1999 reflect the write-down of the book value of the mining companies to fair
market value plus an additional accrual for severance and transaction costs
associated with its disposition of these companies.

LIQUIDITY AND SOURCES OF CAPITAL

Cereus has been funded using both equity and debt financing, and most
recently, from the proceeds of a private equity placement of common stock and
warrants completed on February 8, 2000. The net proceeds to the Company from
this private equity placement were approximately $19,242,000, and upon the
exercise in full of the warrants issued as part of such private equity
placement, Cereus will receive additional proceeds of approximately $40 million.
As of June 30, 2000, Cereus had working capital of approximately $13,715,000.

Cash used in continuing operating activities was approximately $3,208,000
for the six months ended June 30, 2000. Cash used in operations, including
discontinued operations, was approximately $3,444,000 in 2000 compared with cash
used in operations of $146,000 for the six months ended June 30, 1999. The net
use of cash in six months ended June 30, 2000 was primarily a result of the cash
operating losses for the quarter and the planned reduction in accounts payable,
utilizing the proceeds from the private placement.

112
<PAGE> 120

Cash used in investing activities was approximately $486,000 for the six
months ended June 30, 2000 compared to approximately $248,000 for the same
period in 1999. The increase is attributable to purchases of property, plant and
equipment for the Acquired Businesses.

Net cash provided by financing activities was approximately $13,562,000 for
the six months ended June 30, 2000 compared with approximately $121,000 for the
same period in 1999. The financing proceeds primarily related to the net
proceeds of $19,242,000 from the private placement completed in the first
quarter of 2000. These proceeds are offset by loans made to Eltrax of
approximately $4,000,000 of the $5,000,000 agreed upon in the bridge loan
commitment entered into concurrently with execution of the merger agreement. In
addition, Cereus has agreed to loan Eltrax up to an additional $5,000,000 under
certain circumstances. In the first quarter of 1999, the net cash provided by
financing activities related to debt financing.

As of June 30, 2000, Cereus had approximately $9,631,000 in cash. Cereus
anticipates that operating and capital expenditures will be significant as
Cereus continues to expand its application service provider business and web
integration strategy but Cereus believes that its liquidity and capital
resources will be sufficient to satisfy its cash requirements for the next 12
months, including the additional $6,000,000 committed to Eltrax but excluding
any acquisitions or significant hiring activities. In the event additional
capital resources are required, Cereus will attempt to raise additional equity
and debt capital. There can be no assurance that Cereus will be able to raise
such additional funds.

113
<PAGE> 121

WHERE YOU CAN FIND MORE INFORMATION

Eltrax and Cereus file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
reports, statements or other information we file at the SEC's public reference
rooms in Washington, D.C., New York, New York and Chicago, Illinois. Please call
the SEC at 1-800-SEC-0330 for further information on the public reference rooms.
Our SEC filings are also available to the public from commercial document
retrieval services and at the Web site maintained by the SEC at www.sec.gov.

Eltrax has filed a registration statement on Form S-4 to register with the
SEC the Eltrax common stock to be issued to Cereus stockholders in the merger.
This document is a part of that registration statement and constitutes a
prospectus of Eltrax. It is also a proxy statement of Eltrax in addition to
being a proxy statement of Eltrax and Cereus for their respective meetings. As
allowed by SEC rules, this document does not contain all the information you can
find in the registration statement or the exhibits to the registration
statement.

The SEC allows Eltrax to "incorporate by reference" information into this
document, which means that we can disclose important information to you by
referencing you to another document filed separately with the SEC. The
information incorporated by reference is deemed to be part of this document,
except for any information superseded by information in, or incorporated by
reference in, this document. This document incorporates by reference the
documents set forth below that Eltrax has previously filed with the SEC. These
previously filed documents contain important information about Eltrax and its
finances.

<TABLE>
<CAPTION>
ELTRAX SEC FILINGS PERIOD
------------------ ------
<S> <C>
Annual Report on Form 10-K...................... Fiscal Year ended December 31, 1999
Annual Report on Form 10-K/A.................... Fiscal Year ended December 31, 1999
Quarterly Reports on Form 10-Q.................. Quarters ended June 30, 2000, March 31,
2000, September 30, 1999 and June 30, 1999
Current Report on Form 8-K...................... Filed on June 16, 2000
Current Report on Form 8-K...................... Filed on July 28, 2000
Current Report on Form 8-K...................... Filed on August 28, 2000
</TABLE>

Eltrax is also incorporating by reference additional documents that it
files with the SEC between the date of this document and the date of the Eltrax
annual meeting.

If you are an Eltrax stockholder, Eltrax may have sent you some of the
documents incorporated by reference, but you can obtain any of them from Eltrax
or the SEC. Documents incorporated by reference are available from Eltrax
without charge, excluding all exhibits unless Eltrax has specifically
incorporated by reference an exhibit in this document. Eltrax stockholders may
obtain documents incorporated by reference in this document by sending a written
request to Eltrax's Secretary at 400 Galleria Parkway, Suite 300, Atlanta,
Georgia 30339.

Cereus has furnished all information in this document with respect to
Cereus and Eltrax has furnished all information in this document with respect to
Eltrax.

This document does not cover any resale of the securities to be received by
stockholders of Cereus in the merger, and no person is authorized to make any
use of this document in connection with any such resale.

EXPERTS

The restated financial statements incorporated in this document by
reference to Eltrax's Current Report on Form 8-K for the year ended December 31,
1999 have been incorporated in reliance on the report of PricewaterhouseCoopers
LLP, independent accountants, given on the authority of that firm as experts in
auditing and accounting. The audited consolidated balance sheet of Sulcus
Hospitality Technologies Corp. as of December 31, 1998 and the related
consolidated statements of operations, stockholders' equity and cash flows for
each of the two years in the period ended December 31, 1998 (not presented
separately in our financial statements) have been incorporated in reliance on
the report of Crowe

114
<PAGE> 122

Chizek and Company, LLP, independent accountants, given on the authority of that
firm as experts in auditing and accounting.

The consolidated financial statements of Cereus and subsidiaries at
December 31, 1999 and for the year ended December 31, 1999 have been included
herein and in the registration statement in reliance upon the report of KPMG,
LLP, independent certified public accountants, appearing elsewhere herein, and
upon the authority of said firm as experts in accounting and auditing.

The consolidated financial statements of Cereus and subsidiaries at
December 31, 1998 and for the year ended December 31, 1998 have been included
herein and in the registration statement in reliance upon the report of Moore
Stephens Frost, PLC, independent certified public accountants, appearing
elsewhere herein, and upon the authority of said firm as experts in accounting
and auditing.

LEGAL OPINIONS

Jaffe, Raitt, Heuer & Weiss, Professional Corporation, will pass upon the
validity of the shares of Eltrax common stock to be issued in connection with
the merger. As of the date hereof, certain stockholders of Jaffe, Raitt
beneficially own approximately 94,050 shares of Eltrax common stock and no
shares of Cereus common stock.

Rogers & Hardin LLP will pass upon certain of the tax consequences of the
merger. As of the date hereof, certain partners of Rogers & Hardin beneficially
own approximately 120,000 shares of Cereus common stock and no shares of Eltrax
common stock. See "The Merger -- Certain Federal Income Tax Consequences."

115
<PAGE> 123

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Cereus Technology Partners, Inc. and Subsidiaries:
Independent Auditors' Report.............................. F-2
Report of Independent Accountants......................... F-3
Consolidated Balance Sheet, as of December 31, 1999....... F-4
Consolidated Statements of Operations for Years Ended
December 31, 1999 and 1998............................. F-5
Consolidated Statements of Stockholders' Equity for Years
Ended December 31, 1999 and 1998....................... F-6
Consolidated Statements of Cash Flows for Years Ended
December 31, 1999 and 1998............................. F-7
Notes to Consolidated Financial Statements................ F-9
Condensed Consolidated Balance Sheet as of June 30, 2000
(Unaudited)............................................ F-20
Condensed Consolidated Statements of Operations for the
Six Months Ended June 30, 2000 and 1999 (Unaudited).... F-21
Condensed Consolidated Statements of Stockholders' Equity
for the Six Months Ended June 30, 2000 (Unaudited)..... F-22
Condensed Consolidated Statements of Cash Flows for the
Six Months Ended June 30, 2000 and 1999 (Unaudited).... F-23
Notes to Condensed Consolidated Financial Statements
(Unaudited)............................................ F-24
</TABLE>

F-1
<PAGE> 124

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Cereus Technology Partners, Inc.:

We have audited the accompanying consolidated balance sheet of Cereus
Technology Partners, Inc. and subsidiaries as of December 31, 1999, and the
related consolidated statements of operations, stockholders' equity, and cash
flows for the year then ended. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audit.

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

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Cereus
Technology Partners, Inc. and subsidiaries as of December 31, 1999, and the
results of their operations and their cash flows for the year then ended in
conformity with generally accepted accounting principles.

KPMG LLP

Atlanta, Georgia
April 3, 2000

F-2
<PAGE> 125

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors
Cereus Technology Partners, Inc.

We have audited the accompanying consolidated statements of operations,
stockholders' equity and cash flows of Cereus Technology Partners, Inc. and
subsidiaries for the year ended December 31, 1998. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audit.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated results of operations
and cash flows of Cereus Technology Partners, Inc. and subsidiaries for the year
ended December 31, 1998, in conformity with generally accepted accounting
principles.

Moore Stephens Frost PLC

Little Rock, Arkansas
January 28, 1998 (Except for note 3, for
which the date is March 31, 2000)

F-3
<PAGE> 126

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1999

<TABLE>
<S> <C>
ASSETS
Current assets:
Accounts receivable, less allowances of $551,000.......... $ 814,892
Prepaid expenses and other current assets................. 145,120
Assets of discontinued operations held for sale........... 640,000
-----------
Total current assets.............................. 1,600,012
-----------
Property and equipment, net................................. 304,166
Goodwill, net of accumulated amortization of $680,833....... 11,348,425
Other assets................................................ 305,976
-----------
$13,558,579
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Bank overdraft............................................ $ 107,702
Notes payable and short-term debt......................... 3,351,163
Accounts payable.......................................... 1,976,411
Accrued expenses and other current liabilities............ 1,776,783
Accrued stock compensation................................ 638,300
-----------
Total current liabilities......................... 7,850,359
Long-term debt.............................................. 36,463
-----------
Total liabilities................................. 7,886,822
-----------
Stockholders' equity:
Preferred stock........................................... --
Common stock.............................................. 40,627
Additional paid-in capital................................ 15,481,923
Accumulated deficit....................................... (8,835,482)
-----------
Total............................................. 6,687,068
Less notes receivable from stockholders................... (1,015,311)
-----------
Total stockholders' equity........................ 5,671,757
-----------
Commitments and contingencies............................... $13,558,579
===========
</TABLE>

See accompanying notes to consolidated financial statements.

F-4
<PAGE> 127

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1999 1998
----------- ----------
<S> <C> <C>
Net sales................................................... $ 1,695,853 $ --
Cost of sales............................................... 1,935,121 --
----------- ----------
Gross loss........................................ (239,268) --
----------- ----------
Selling, general, and administrative expenses:
Stock compensation expense................................ 1,063,300 --
Amortization expense...................................... 680,833 --
Other selling, general, and administrative expenses....... 960,952 --
----------- ----------
Total selling, general, and administrative
expenses........................................ 2,705,085 --
----------- ----------
Operating loss.................................... (2,944,353) --
Interest expense, net....................................... 513,242 --
----------- ----------
Loss before income taxes and discontinued
operations...................................... (3,457,595) --
Income taxes from continuing operations..................... -- --
----------- ----------
Loss before discontinued operations............... (3,457,595) --
----------- ----------
Discontinued operations:
Loss from discontinued operations......................... (239,957) (351,606)
Loss on disposal of discontinued operations............... (3,486,297) --
----------- ----------
(3,726,254) (351,606)
----------- ----------
Net loss.......................................... $(7,183,849) $ (351,606)
=========== ==========
Loss per share -- basic and diluted:
Loss before discontinued operations....................... $ (1.57) --
Discontinued operations................................... (1.69) (0.27)
=========== ==========
Net loss.......................................... (3.26) (0.27)
Imputed noncash preferred stock dividend.................... -- (0.05)
----------- ----------
Loss available to common shares................... $ (3.26) $ (0.32)
=========== ==========
Weighted average common shares outstanding................ 2,198,690 1,325,016
=========== ==========
</TABLE>

See accompanying notes to consolidated financial statements.

F-5
<PAGE> 128

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
PREFERRED COMMON
-------------------- -------------------
SHARES AMOUNT SHARES AMOUNT
-------- --------- --------- -------
<S> <C> <C> <C> <C>
Balances at December 31, 1997........................ -- $ -- 1,326,685 $13,267
Issuance of 150,000 shares of preferred stock........ 150,000 150,000 -- --
Cashless exercise of stock options................... -- -- 2,476 25
Imputed noncash dividend on preferred stock.......... -- -- -- --
Net loss............................................. -- -- -- --
-------- --------- --------- -------
Balances at December 31, 1998........................ 150,000 150,000 1,329,161 13,292
Issuance of common stock for convertible notes....... -- -- 214,287 2,143
Issuance of common stock in secondary offering....... -- -- 624,750 6,248
Issuance of common stock and note receivable to
acquire common stock in connection with
acquisitions....................................... -- -- 1,749,999 17,500
Conversion of outstanding preferred stock............ (150,000) (150,000) 75,000 750
Common stock granted for services.................... -- -- 66,666 667
Cashless exercise of stock options................... -- -- 2,741 27
Discount on subordinated debt........................ -- -- -- --
Net loss............................................. -- -- -- --
-------- --------- --------- -------
Balances at December 31, 1999........................ -- $ -- 4,062,604 $40,627
======== ========= ========= =======
</TABLE>

<TABLE>
<CAPTION>
ADDITIONAL NOTES
PAID-IN RETAINED RECEIVABLE FROM TOTAL
CAPITAL EARNINGS SHAREHOLDERS EQUITY
----------- ----------- --------------- -----------
<S> <C> <C> <C> <C>
Balances at December 31, 1997............. $ 4,242,467 $(1,232,527) $ -- $ 3,023,207
Issuance of 150,000 shares of preferred
stock................................... 225,000 -- -- 375,000
Cashless exercise of stock options........ (25) -- -- --
Imputed noncash dividend on preferred
stock................................... 67,500 (67,500) -- --
Net loss.................................. -- (351,606) -- (351,606)
----------- ----------- ----------- -----------
Balances at December 31, 1998............. 4,534,942 (1,651,633) -- 3,046,601
Issuance of common stock for convertible
notes................................... 447,857 -- -- 450,000
Issuance of common stock in secondary
offering................................ 2,492,752 -- -- 2,499,000
Issuance of common stock and note
receivable to acquire common stock in
connection with acquisitions............ 7,586,500 -- (1,015,311) 6,588,689
Conversion of outstanding preferred
stock................................... (225,750) -- -- (375,000)
Common stock granted for services......... 199,333 -- -- 200,000
Cashless exercise of stock options........ (27) -- -- --
Discount on subordinated debt............. 446,316 -- -- 446,316
Net loss.................................. -- (7,183,849) -- (7,183,849)
----------- ----------- ----------- -----------
Balances at December 31, 1999............. $15,481,923 $(8,835,482) $(1,015,311) $ 5,671,757
=========== =========== =========== ===========
</TABLE>

See accompanying notes to combined financial statements.

F-6
<PAGE> 129

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------
1999 1998
----------- -----------
<S> <C> <C>
Operating activities:
Continuing operations:
Loss from continuing operations......................... $(3,457,595) $ --
Adjustments to reconcile net loss to net cash provided
by continuing operating activities:
Depreciation and amortization........................ 725,136 --
Noncash stock compensation........................... 1,063,300 --
Accounts receivable allowances....................... 526,000 --
Amortization of debt discount........................ 372,975
Changes in operating assets and liabilities:
Accounts receivable................................ (749,146) --
Prepaid expenses and other current assets.......... (394,883) --
Other assets....................................... (305,976) --
Accounts payable................................... 966,770 --
Accrued expenses and other liabilities............. (39,008)
Accrued stock compensation......................... 638,300 --
----------- -----------
Net cash used in continuing operating
activities.................................... (654,127) --
----------- -----------
Discontinued operations:
Loss from discontinued operations....................... (239,957) (351,606)
Loss on disposal of discontinued operations............. (3,486,297) --
Adjustments to reconcile loss from discontinued
operations to net cash provided by discontinued
operating activities:
Loss on divested operations.......................... 3,486,297 --
Changes in operating assets and liabilities for
discontinued operating activities.................... (112,387) 187,270
----------- -----------
Net cash used in discontinued operating
activities.................................... (352,344) (164,336)
----------- -----------
Net cash used in operating activities........... (1,006,471) (164,336)
----------- -----------
Investing activities:
Continuing operations:
Additions to property and equipment..................... (167,810) --
Acquisition of businesses, net of cash acquired......... (1,950,000) --
----------- -----------
Net cash used in investing activities for
continuing operations......................... (2,117,810) --
----------- -----------
Discontinued operations:
Additions to property, plant, and equipment............. -- (91,160)
Proceeds from sale of property, plant and, and
equipment............................................. -- 11,000
Increase in resource property........................... -- (5,000)
----------- -----------
Net cash used in investing activities for
discontinued operations....................... -- (85,160)
----------- -----------
Net cash used in investing activities........... (2,117,810) (85,160)
Financing activities:
Increase in bank overdraft................................ 107,702 --
Proceeds from borrowings from note payable................ -- 150,000
Proceeds from issuance of long-term debt.................. 1,259,103 161,489
Repayments of long-term debt.............................. (51,054) (122,050)
Issuance of notes receivable.............................. (1,015,311) --
Issuance of common stock.................................. 2,499,000 --
Issuance of preferred stock............................... -- 375,000
----------- -----------
Net cash provided by financing activities....... 2,799,440 564,439
----------- -----------
Net increase in cash and cash equivalents....... (324,841) 314,943
Cash and cash equivalents at beginning of period............ $ 324,841 $ 9,898
=========== ===========
Cash and cash equivalents at end of period.................. $ -- $ 324,841
=========== ===========
</TABLE>

F-7
<PAGE> 130

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Supplemental disclosures of cash flow information: Cash paid
during the period for continuing operations:
Interest.................................................. $ 140,267 $ --
========== ==========
Income taxes.............................................. $ -- $ --
========== ==========
Supplemental disclosures of noncash investing and financing
activities:
Issuance of common stock for businesses acquired.......... $7,604,000 $ --
========== ==========
Issuance of debt for businesses acquired.................. $1,575,000 $ --
========== ==========
Issuance of common stock for convertible notes............ $ 450,000 $ --
========== ==========
Conversion of outstanding preferred stock................. $ 375,000 $ --
========== ==========
Common stock granted for services......................... $ 200,000 $ --
========== ==========
Imputed noncash dividend on preferred stock............... $ -- $ 67,500
========== ==========
</TABLE>

See accompanying notes to consolidated financial statements.

F-8
<PAGE> 131

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES

(a) Business and Basis of Presentation

Cereus Technology Partners, Inc. and subsidiaries (the "Company" or
"Cereus"), was formerly named AIM Group, Inc. prior to December 1, 1999. Prior
to July 31, 1999, the Company had been solely engaged since its incorporation in
1994 in the development of specialized minerals and operation of specialty
materials projects ("Mineral Operations"). Although the Company continues to be
engaged in the Minerals Operations, in the fourth quarter of 1999 the Company
made the decision to discontinue its Mineral Operations and either sell or close
the operations. On March 31, 2000, the Company entered into an agreement to sell
its mineral businesses for approximately $640,000, plus approximately $340,000
of working capital contributions, to the Company's former Chairman of the Board
(the "Mineral Transaction"). Accordingly, the surface modification and mining
operations have been reflected as discontinued operations in the accompanying
consolidated financial statements. The Mineral Transaction is expected to be
completed during the quarter ending June 30, 2000 (see note 3).

In 1999, the Company acquired three companies that provided information
technology services and began providing business software implementation and
consulting and Internet services. On July 30, 1999, the Company acquired The
Reddy Group, Inc. and its wholly-owned subsidiary, Cereus Bandwidth LLC
(collectively, "Cereus Bandwidth"), an Atlanta-based Internet service provider
("ISP") which developed and currently markets a variety of Internet, intranet
and e-commerce services. On July 30, 1999, the Company acquired Enterprise
Solutions Group, Inc. ("ESG"), a West Palm Beach based business software
applications consulting firm. On November 15, 1999, the Company acquired Client
Server Solutions, Inc. ("CSS"), an Atlanta-based business software sales and
service company. ESG and CSS are focused on enterprise resource planning ("ERP")
applications consisting of integrated financial, administrative, payroll and
human resource, manufacturing, distribution, point-of-sale and inventory
management software. The applications are supported by software that includes
management information systems and database management of sales and marketing
information.

(b) Principles of Consolidation

The consolidated financial statements include the financial statements of
Cereus Technology Partners, Inc. and its wholly owned subsidiaries. All
significant intercompany balances and transactions have been eliminated in
consolidation.

Revenue is derived from the sale of software licenses, hardware, and
software services and is allocated to each element of multi-element arrangements
based on the relative fair values of the elements, which is established by the
price charged when the respective element is sold separately.

Revenue from license fees and hardware is recognized when persuasive
evidence of an agreement exists, delivery of the product has occurred, the fee
is fixed or determinable and collectibility is probable.

Software services include installation, training, and maintenance. Revenue
from installation and training are recognized upon performance of the related
services. Installation and training services are offered and billed as separate
elements of contracts and are not essential to the functionality of the
software.

Maintenance is offered as a separate element and includes the right to
unspecified upgrades on a when-and-if available basis. Maintenance revenue is
deferred and recognized ratably over the term of the related contract, usually
one year. Specified upgrades are not typically offered to customers.

F-9
<PAGE> 132
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

In December 1998, the Accounting Standards Committee of the American
Institute of Certified Public Accountants issued SOP 98-9, Software Revenue
Recognition with Respect to Certain Transactions. SOP 98-9 is effective for
fiscal years beginning after March 15, 1999. The Company does not expect a
material change to its accounting for revenues as a result of adopting the
provisions of SOP 98-9.

Accounts receivable include amounts due from customers for which revenue
has been recognized. Deferred revenue consists of amounts collected from
customers for license and software services that have not met the criteria for
revenue recognition.

(d) Cash Equivalents

The Company considers all short-term, highly liquid investments with
original maturities of three months or less to be cash equivalents.

(e) Property and Equipment

Property and equipment are stated at cost. Amortization of capital lease
assets is included in depreciation expense. Depreciation is provided on a
straight-line basis over the estimated useful lives of the assets, which is
generally 5 years for computer equipment and 10 years for furniture, fixtures
and office equipment.

Depreciation expense for continuing operations was $50,088, and $-0- for
the years ended December 31, 1999, and 1998, respectively.

Property and equipment, net, consisted of the following at December 31,
1999:

<TABLE>
<CAPTION>
1999
--------
<S> <C>
Office equipment............................................ $ 58,506
Furniture and fixtures...................................... 89,901
Computer equipment.......................................... 120,225
Computer software........................................... 85,622
--------
354,254
Less accumulated depreciation and amortization.............. 50,088
--------
Property and equipment, net....................... $304,166
========
</TABLE>

(f) Goodwill

Goodwill, which represents the excess purchase price over net assets
acquired, is amortized on a straight-line basis over the expected period to be
benefited, generally 5 years. The Company evaluates the recoverability of these
intangible assets at each period end using the undiscounted estimated future net
operating cash flows expected to be derived from such assets. The amount of
goodwill impairment, if any, is measured based on projected discounted future
operating cash flows using a discount rate reflecting the Company's anticipated
average cost of funds. The assessment of the recoverability of goodwill will be
impacted if estimated future operating cash flows are not achieved.

(h) Income Taxes

Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases and operating loss and tax credit carryforwards. Deferred tax assets and
liabilities are measured using the enacted tax rates expected

F-10
<PAGE> 133
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

to apply to taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in the statement of
operations in the period that includes the enactment date.

(i) Stock-Based Compensation

The Company applies the intrinsic value-based method of accounting
prescribed by Accounting Principles Board ("APB") Opinion No. 25, "Accounting
for Stock Issued to Employees," and related interpretations, in accounting for
its stock-based awards. As such, compensation expense would be recorded on the
date of grant only if the current market price of the underlying stock exceeded
the exercise price. Statement of Financial Accounting Standards No. 123,
Accounting for Stock-Based Compensation ("SFAS No. 123") established accounting
and disclosure requirements using a fair value-based method of accounting for
stock-based employee compensation plans. As allowed by SFAS No. 123, the Company
has elected to continue to apply the intrinsic value-based method of accounting
described above, and has adopted the disclosure requirements of SFAS No. 123.

(j) Earnings Per Share

Net loss per share-basic is computed based on net loss divided by the
weighted average common shares outstanding during the year. Earnings per share
is not presented on a diluted basis, as the effect of potentially dilutive
securities was either anti-dilutive due to net losses or immaterial for the
periods presented.

(k) Comprehensive Income

No statements of comprehensive income have been included in the
accompanying consolidated financial statements for the years ended December 31,
1999 and 1998 since the Company does not have any "other comprehensive income"
to report.

(l) Recent Accounting Pronouncements

In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133 ("SFAS No. 133"), Accounting for
Derivative Instruments and Hedging Activities. This statement establishes
accounting and reporting standards for derivative instruments, including
derivative instruments embedded in other contracts, and for hedging activities.
It requires that, at adoption, hedging relationships should be designated anew
and that entities recognize all derivatives as either assets or liabilities in
the statement of financial position and to measure those instruments at fair
value. The accounting for changes in the fair value of a derivative depends on
the intended use of the derivative and the resulting designation. Pursuant to
Statement of Financial Accounting Standards No. 137, Accounting for Derivative
Instruments and Hedging Activities, SFAS 133 is effective for all fiscal years
beginning after June 15, 2000. The Company expects that there will be no
material impact as a result of its adoption of SFAS No. 133.

(m) Use of Estimates

Management of the Company has made a number of estimates and assumptions
relating to the reporting of assets and liabilities and the disclosure of
contingent assets and liabilities to prepare these financial statements in
conformity with generally accepted accounting principles. Actual results could
differ from those estimates.

F-11
<PAGE> 134
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(n) Impairment of Long-lived Assets and Long-lived Assets to be Disposed of

Long-lived assets and certain identifiable intangibles are reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. Recoverability of assets to
be held and used is measured by a comparison of the carrying amount of an asset
to undiscounted future net cash flows expected to be generated by the asset. If
such assets are considered to be impaired, the impairment to be recognized is
measured by the amount by which the carrying amount of the assets exceeds the
fair value of the assets. Assets to be disposed of are reported at the lower of
the carrying amount or the fair value less costs to sell.

(o) Reclassifications

Certain reclassifications have been made to the 1998 consolidated financial
statements to conform to the presentation adopted in 1999.

(p) Commitments and Contingencies

Liabilities for loss contingencies arising from claims, assessments,
litigation, fines and penalties and other sources are recorded when it is
probable that a liability has been incurred and the amount of the assessment
and/or remediation can be reasonably estimated. Recoveries from third parties,
which are probable of realization, are separately recorded, and are not offset
against the related liability, in accordance with Financial Accounting Standards
Board Interpretation No. 39, "Offsetting of Amounts Related to Certain
Contracts."

(2) ACQUISITIONS

On July 30, 1999, Cereus acquired 100% of the outstanding common stock of
ESG pursuant to a Stock Purchase Agreement, dated as of July 31, 1999 (the "ESG
Agreement"), by and between the Company and the shareholders of ESG, for
approximately $3,024,000 including acquisition costs. The total consideration
paid by Cereus in connection with the ESG acquisition consisted of $550,000 in
cash, a $250,000 two-year subordinated note and 383,333 shares of the Company's
common stock valued at $5.06 per share totaling $1,941,000. As a result of the
acquisition, ESG became a wholly-owned subsidiary of the Company. The purchase
method of accounting was used to record the acquisition. Accordingly, the
results of operations of ESG for the period July 31, 1999 through December 31,
1999 are included in the Company's consolidated financial statements. The excess
of the purchase price over the fair value of the net assets acquired,
approximately $2,754,000, was recorded as goodwill and is being amortized over
five years, the expected benefit period.

On July 30, 1999, the Company acquired 100% of the outstanding common stock
of Cereus Bandwidth ("CB") pursuant to a Stock Purchase Agreement, dated as of
July 31, 1999 (the "CB Agreement"), by and between the Company and the
shareholders of CB, for approximately $2,965,000 including acquisition costs.
The total consideration paid by the Company in connection with the acquisition
consisted of $1 million in cash and 333,333 shares of the Company's common stock
valued at $5.06 per share totaling $1,688,000. As a result of the acquisition,
CB became a wholly-owned subsidiary of the Company. The purchase method of
accounting was used to record the acquisition. Accordingly, the results of
operations for CB for the period July 31, 1999 through December 31, 1999 are
included in the Company's consolidated financial statements. The excess of the
purchase price over the fair value of the net assets acquired, approximately
$2,850,000, was recorded as goodwill and is being amortized over five years, the
expected benefit period.

On November 15, 1999, the Company acquired 100% of the issued and
outstanding capital stock of each of Client Server Solutions, Inc. ("CSS"), a
Delaware corporation, and CSS Financial Software

F-12
<PAGE> 135
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Sales, Inc. ("CSS Financial"), a Georgia corporation, pursuant to a Merger
Agreement, dated as of November 15, 1999 (the "CSS Agreement"), by and between
the Company and the shareholders of CSS and CSS Financial, for approximately
$5,134,000 including acquisition costs (net of notes receivable issued to the
selling shareholders). The total consideration paid by Cereus in connection with
the acquisition consisted of $400,000 in cash, $1,325,000 in short term notes
payable, and 983,333 shares of the Company's common stock, including 150,000
shares held in escrow, valued at $4.50 per share totaling $4,425,000 subject to
a future earn-out provision. As a result of the acquisition, each of CSS and CSS
Financial were merged with and into a wholly-owned subsidiary of the Company.
The purchase method of accounting was used to record the acquisition.
Accordingly, the results of operations for CSS for the period November 16, 1999
through December 31, 1999 are included in the Company's consolidated financial
statements. The excess of the purchase price over the fair value of the net
assets acquired, approximately $6,425,000, was recorded as goodwill and is being
amortized over five years, the expected benefit period.

The following unaudited pro forma financial information presents the
combined results of operations of the Company, ESG, CB, and CSS as if the
acquisitions had occurred on January 1, 1998 after giving effect to certain
adjustments including amortization of goodwill. The pro forma financial
information does not necessarily reflect the results of operations that would
have occurred had the Company, ESG, CB, and CSS constituted a single entity
during such periods.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1999 1998
----------- ----------
(UNAUDITED)
<S> <C> <C>
Pro forma consolidated net sales............................ $ 6,380,684 $6,579,595
=========== ==========
Pro forma consolidated loss before discontinued
operations................................................ $(4,827,797) $ (101,303)
=========== ==========
Pro forma consolidated net loss............................. $(8,554,051) $ (452,909)
=========== ==========
Pro forma loss per share.................................... $ (2.46) $ (0.14)
=========== ==========
</TABLE>

(3) DISCONTINUED OPERATIONS

The Company, until July 31, 1999, was solely a mining and mined products
company. During 1999, the Company decided to change its business model to become
a technology services company. To accomplish this objective, the Company
acquired three technology consulting companies and changed its name.

In March 2000, the Company executed a sale agreement with the former
Chairman and President of the Company. This agreement specifies a purchase price
of approximately $640,000 for the stock of all mining subsidiaries plus
approximately $340,000 of working capital contributions to be provided by the
Company. The consideration will be in the form of an interest-bearing note, due
in 180 days, unless called earlier by the Company based upon certain rights.
This note is secured by the pledge of 84,000 shares of the Company's stock.

The Company will retain no subsequent interests in any mining operations or
assets, no liabilities, expressed or contingent with respect to the mining
operations, and the ultimate payment of the note is not tied in any form to the
results of the mining operations.

The sales price approximates the fair market value of the assets, as
determined by an independent appraiser. Therefore, the Company wrote down the
book value of its mining operations to this fair market value and accrued for
transaction costs and severance obligations associated with the disposition.
Management has estimated that income from operations for the mining operations
would be approximately break-even until the expected closing date during the
second fiscal quarter of fiscal 2000, and accordingly, did not accrue any
amounts for future losses as of December 31, 1999. In accordance with generally

F-13
<PAGE> 136
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

accepted accounting principles the Company's prior period financial statements
have been reclassified to reflect the results of the discontinued operations.

(4) ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following at
December 31, 1999:

<TABLE>
<S> <C>
Accrued employee compensation and benefits.................. $ 507,064
Accrued liabilities......................................... 986,483
Deferred revenue............................................ 26,413
Accrued interest payable.................................... 58,824
Taxes accrued and withheld.................................. 197,999
----------
$1,776,783
==========
</TABLE>

(5) INCOME TAXES

The Company has net operating loss carryforwards available to offset future
taxable income of approximately $5,200,000 expiring through the year 2019. The
net operating loss carryforwards are subject to certain limitations, computed on
an annual basis. Due to the Company's continued losses and the restricted use of
some of the net operating loss carryforwards, a valuation allowance has been
recorded to offset net deferred tax assets.

Deferred tax assets and liabilities at December 31, 1999 are as follows:

<TABLE>
<S> <C>
Gross deferred tax asset.................................... $3,900,000
Less valuation allowance.................................... 2,500,000
----------
Net deferred tax asset............................ 1,400,000
Gross deferred tax liability................................ 1,400,000
----------
Net deferred taxes................................ $ --
==========
</TABLE>

The Company's income tax benefit from continuing operations for 1999 and
1998 differed from the amounts computed by applying the Federal income tax rate
of 34% as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------
1999 1998
---------- ----------
<S> <C> <C>
Computed expected income tax benefit........................ $1,176,000 $ --
Increase (decrease) in income tax benefit resulting from:
Increase in valuation allowance........................... (891,000) --
Amortization of goodwill.................................. (231,000) --
Other..................................................... (54,000) --
---------- ----------
$ -- $ --
========== ==========
</TABLE>

(6) DEBT

The Company has a line of credit agreement with a bank which provides for
borrowings of up to $400,000 with interest payable monthly at the prime rate
plus 1.5% (effective rate of 10.46% at December 31, 1999). The line is
collateralized by all business assets of the former CSS company and personal
life insurance contracts. The line expires March 20, 2000 and is renewable at
that time for one year. The Company had borrowings of $399,193 under this line
of credit at December 31, 1999, which were paid in full in April 2000.

F-14
<PAGE> 137
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

During 1999 the Company entered into several loan agreements with the
selling shareholders of CSS and ESG. The balance of the loans payable under
these agreements is $1,565,311 at December 31, 1999. The notes payable for CSS
have a term of four to six months and bear interest at 8% per annum. The note
payable for ESG is a subordinated promissory note with a two-year term bearing
interest at 3% per annum and is payable in two equal installments of $130,653 on
July 30, 2000 and 2001. During the first quarter of fiscal 2000, the ESG note
was cancelled and replaced by the issuance of 50,000 shares of common stock at
$5 per share and 50,000 warrants exercisable at $10 per share and $300,000 of
the CSS notes were canceled and replaced by the issuance of 60,000 shares of
common stock at $5 per share and 60,000 warrants exercisable at $10 per share.

The Company has several non-interest bearing loan agreements to fund the
working capital needs of the Company totaling $35,000 at December 31, 1999.
These loans were paid in full during the first quarter of fiscal 2000.

In 1997 the Company issued $1,050,000 of Series A convertible notes payable
(the "Convertible Notes"). At December 31, 1999 the Company had $600,000 of the
Convertible Notes outstanding with three related parties. Prior to 1999 the
Convertible Notes were amended several times. The various amendments included
provisions which: (a) extended the maturity date of the Convertible Notes to
June 30, 1999; (b) increased the annual interest rate to 10%, effective January
1, 1997; (c) changed the conversion price to $2.10 per common share; and (d)
agreed that the Company will not, without the prior approval of the holders of
at least 80% of the principal amount of the Convertible Notes outstanding, incur
any indebtedness which ranks senior in priority to payment to the Convertible
Notes. In 1999, the Convertible Notes were amended to extend the maturity date
to June 30, 2000 as well as binding the holders of the Convertible Notes to
certain provisions restricting the sale of any shares issued upon conversion.
The Convertible Notes are unsecured. A total of $450,000 of the Convertible
Notes were converted in June 1999, in exchange for 214,286 shares of the
Company's common stock. Subsequent to December 31, 1999, the remaining
Convertible Notes were converted to common stock pursuant to the original terms.

In 1999, the Company issued $825,000 of subordinated notes ("Subordinated
Notes") which were convertible into common shares at $3.75 per share and
warrants to purchase common shares at $4.00 per share. Upon conversion, the
noteholders will receive warrants to purchase a number of shares equal to: 0.5
times the number of shares into which their Subordinated Notes are converted if
the Subordinated Notes are converted within 30 days of closing; 1.0 times the
number of shares into which their Subordinated Notes are converted if the
Subordinated Notes are repaid or converted up to 90 days of closing; 1.5 times
the number of shares into which their Subordinated Notes are convertible if the
Subordinated Notes are repaid or converted after 90 days of closing. The
interest rate on the Subordinated Notes is 15% per annum payable semi-annually.
The Subordinated Notes mature on October 15, 2000. As of December 31, 1999, the
Subordinated Notes and related debt discount of $73,341 were outstanding. On
February 10, 2000, all of the Subordinated Notes were converted to stock and
warrants. (See note 10.)

(7) SHAREHOLDERS' EQUITY

(a) Common and Preferred Stock

Pursuant to the Company's Restated Certificate of Incorporation, the
Company is authorized to issue 50 million shares of common stock, $.01 par value
per share, and 10 million shares of convertible preferred stock, $1.00 par value
per share.

The preferred shares were convertible into one share of common stock, as
adjusted for any future stock dividends, stock splits or reverse stock splits.
The conversion feature of the preferred stock is $2.50 per share, which was less
than the current market price for the common stock at December 31, 1998. This

F-15
<PAGE> 138
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

resulted in a beneficial conversion amount, which was recorded as an imputed
non-cash preferred stock dividend for the year ended December 31, 1998 in the
accompanying consolidated financial statements. The preferred shares were
converted in 1999, and no shares were outstanding as of December 31, 1999.

(b) Stock Options

(i) Stock Option Plans. In September 1997, the Company's shareholders
approved the adoption of the Company's 1997 Stock Option Plan (the "Plan"),
which is administered by the Company's Board of Directors, and authorized a
total of 250,000 shares of Common Stock for issuance thereunder. The purpose of
the Plan is to enable the Company to attract and retain competent personnel by
offering them the opportunity to acquire a proprietary interest in the Company.
On November 30, 1999, stockholders of the Company approved an increase in the
number of shares of Common Stock authorized for issuance under the Plan from
250,000 to 3,000,000 shares. Additionally, option grants for outside directors
are covered by two separate plans. The Board has also approved option grants for
non-employee advisors.

(ii) Stock Option Activity. The following table summarizes activity in the
Company's stock option plans for the years ended December 31, 1999 and 1998:

<TABLE>
<CAPTION>
WEIGHTED-AVERAGE
SHARES EXERCISE PRICE
------- -----------------
<S> <C> <C>
Options outstanding at December 31, 1997.................... 73,333 $0.90
Granted..................................................... 121,000 2.90
Exercised................................................... (3,333) 0.90
Forfeited................................................... (8,333) 0.90
-------
Options outstanding at December 31, 1998.................... 182,669 2.22
Granted..................................................... 783,333 3.91
Exercised................................................... (3,333) 0.90
-------
Options outstanding at December 31, 1999.................... 962,669 $3.60
=======
</TABLE>

The following table summarizes information about stock options outstanding
and exercisable as of December 31, 1999:

<TABLE>
<CAPTION>
OPTIONS OUTSTANDING
------------------------------------------------------ OPTIONS EXERCISABLE
WEIGHTED- ---------------------------
NUMBER AVERAGE WEIGHTED- NUMBER WEIGHTED-
RANGES OF OUTSTANDING AT REMAINING AVERAGE EXERCISABLE AT AVERAGE
EXERCISE DECEMBER 31, CONTRACTUAL EXERCISE DECEMBER 31, EXERCISE
PRICES 1999 LIFE(MONTHS) PRICE 1999 PRICE
---------- -------------- ------------ --------- --------------- ---------
<S> <C> <C> <C> <C> <C>
$ 0.90 58,336 93 $0.90 25,835 $0.90
2.50-3.00 121,000 102 2.90 49,000 2.74
3.00-4.75 783,333 58 3.91 52,500 4.00
------- --- ----- ------- -----
$0.90-4.75 962,669 65 $3.60 127,335 $2.89
======= === ===== ======= =====
</TABLE>

The per share weighted-average fair value of stock options granted during
1999 and 1998 was $4.41 and $2.90, respectively, on the date of grant using the
Black Scholes option-pricing model. For the year ended December 31, 1999 the
Company used the following weighted-average assumptions: dividend rate of 0%,
expected volatility of 100%, risk-free interest rate of 6.5% and an expected
life of one year. For the year ended December 31, 1998, the Company used the
following weighted-average assumptions: dividend rate of 0%, expected volatility
of 30%, risk-free interest rate of 4.61% to 6.09% and an expected life of 5 to
10 years.

F-16
<PAGE> 139
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Under its adoption of SFAS No. 123, the Company applies the provisions of
APB Opinion No. 25 in accounting for its stock option plans and, accordingly, no
compensation cost has been recognized for stock options in the accompanying
consolidated financial statements. Had the Company determined compensation cost
based on the fair value of the option at the grant date, the Company's pro forma
net loss would have been as follows:

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
-----------------------
1999 1998
----------- ---------
<S> <C> <C>
Net loss:
As reported............................................ $(7,183,849) $(351,606)
=========== =========
Pro forma.............................................. $(9,229,205) $(358,600)
=========== =========
Loss per share:
As reported............................................ $ (3.26) $ (0.32)
=========== =========
Pro forma.............................................. $ (4.20) $ (0.32)
=========== =========
</TABLE>

In 1999, in connection with the issuance of the Subordinated Notes
described in note 6, the Company issued stock purchase warrants enabling the
holders to purchase 220,000 shares of the Company's Class A voting common stock
at an exercise price of $4.00 per share at any time through December 2000. The
estimated fair value of these warrants at the date issued was between $1.67 per
share and $2.73 per share using the Black-Scholes option pricing model and
assumptions similar to those used for valuing the Company's stock options as
described above. The terms of the stock purchase warrants include certain
registration rights and grant the holder the right and option to put the
warrants back to the Company for cash for a period of 30 days immediately prior
to the expiration thereof at a price equal to the fair market value of the
shares of Class A voting common stock issuable to the holder upon exercise, as
defined.

In 1999, the Company also issued 168,738 warrants to purchase one share
each of the Company's common stock. The warrants expire at various points
between 2001 and 2004. The warrants have exercise prices between $3.75 and $4.15
per share. The estimated fair value of these warrants at the dates issued was
between $1.52 per share and $2.58 per share using the Black-Scholes option
pricing model and assumptions similar to those used for valuing the Company's
stock options as described above. At December 31, 1999, the warrants were
outstanding.

(8) COMMITMENTS AND CONTINGENCIES

(a) Lease Commitments

The Company is obligated under noncancelable operating lease agreements for
office facilities, furniture and fixtures, and computer equipment for the next
five years and thereafter.

F-17
<PAGE> 140
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Future minimum lease payments under all noncancelable operating lease
agreements with remaining terms in excess of one year in the aggregate and for
the next five years are shown as follows:

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31,
------------------------
<S> <C>
2000........................................................ $ 612,033
2001........................................................ 589,284
2002........................................................ 540,391
2003........................................................ 525,863
2004........................................................ 512,110
----------
Total............................................. $2,779,681
==========
</TABLE>

Net rental expense for all cancelable and noncancelable operating leases
was $99,774 for the year ended December 31, 1999. Net rental expense for all
cancelable and noncancelable operating leases was $-0- for the year ended
December 31, 1998.

(b) Contractual Commitments

In an agreement dated December 14, 1999, the Company agreed to issue
approximately 53,000 shares of restricted stock valued at $250,000, its fair
value at that date, in return for user licenses for resale from a software
vendor. The Company committed to purchase a minimum of $500,000 of user licenses
each year for the next three years following the anniversary date of the
agreement. These licenses can be resold at any time in the future. In return,
for the commitment, the Company will receive from the vendor 50,000 warrants to
purchase the common stock of the vendor which vest when certain purchase levels
have been attained. As of December 31, 1999, the Company had not issued its
restricted stock or received the vendor's warrants.

In a separate agreement with the same vendor dated December 23, 1999, the
Company committed to purchase Application Service Provisioner user months for a
total commitment of $1,115,000. This commitment is payable quarterly over the
twelve month period beginning on the date of the contract. The user months can
be resold anytime in the future. In return for this commitment, the Company will
receive 5,000 warrants to purchase the common stock of the vendor which vest
when certain purchase levels have been attained.

In an agreement dated December 6, 1999, the Company committed to purchase
software licenses from another vendor requiring payments totaling $250,000
through June 2000. For these payments, the Company will receive credits in
excess of the $250,000 payment toward purchases of software licenses to be used
anytime in the future.

Additionally, the Company entered into contractual commitments to deliver
products and services in the ordinary course of business. The Company believes
that all such contractual commitments will be met or renegotiated such that no
material adverse financial impact on the Company's financial position or results
of operations will result from the Company's failure to meet these commitments.

The Company is subject to lawsuits, claims, and other complaints arising
out of the ordinary conduct of business. While the ultimate results and outcomes
from these matters cannot be determined precisely, management, based in part
upon the advice of legal counsel, believes that all matters are adequately
covered by insurance or, if not covered, are without merit or are of such
amounts as would not have a material adverse effect on the Company's financial
position or results of operations.

F-18
<PAGE> 141
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(9) MAJOR CUSTOMERS

For the year ended December 31, 1999, one customer accounted for 21% of
revenues.

(10) SUBSEQUENT EVENTS

(a) Private Placement

On February 8, 2000 the Company completed a private equity placement of its
common stock. The placement consisted of approximately 4 million shares of
common stock at $5 per share and a like number of warrants exercisable at $10
per share. The gross proceeds were approximately $20 million. All stock and
warrants issued were unregistered.

(b) Stock Compensation

During the quarter ended March 31, 2000 stock issued to certain employees
pursuant to contingent payments under amended terms of the CSS acquisition, as
well as purchases of stock and warrants by members of management under terms
similar to that of the private equity placement, resulted in stock compensation
expense of approximately $2.2 million (Unaudited).

During the quarter ended March 31, 2000, the Company retired approximately
$2 million of its notes payable outstanding as of December 31, 1999 through a
conversion of the notes into a combination of stock and warrants. In addition
another $440,000 of notes issued in January of 2000 were converted into stock
and warrants, and the Company settled certain other amounts payable via issuance
of common stock and warrants. Approximately $1 million of the notes were
converted pursuant to their original terms and accordingly no gain or loss on
the extinguishment of debt was recognized. The remaining notes payable and other
payables were extinguished based upon terms not pursuant to the original
obligations. Accordingly, the Company will recognize a loss on extinguishment of
approximately $7.2 million (Unaudited) based upon the difference between the
fair value of the stock and warrants issued and the debt extinguished as
measured at the dates of the extinguishment.

(d) Impairment

During the first quarter of fiscal 2000 the Company hired new management,
appointed a new board of directors and changed its strategic direction from an
ERP implementation and consulting business to a web integration and application
service provider. As a result, management under took a review of its net
investments in the recently acquired companies and based upon its projections of
expected future cash flows over a five year period, discounted using a 12%
interest rate, determined that the investments in the companies previously
engaged in ERP software sales and implementation services was were impaired.
Accordingly the Company expects to recognize an impairment charge of $5.6
million (Unaudited) during the quarter ended March 31, 2000.

F-19
<PAGE> 142

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

<TABLE>
<CAPTION>
JUNE 30, 2000 DECEMBER 31, 1999
------------- -----------------
<S> <C> <C>
ASSETS
Current assets:
Cash...................................................... $ 9,631,407 $ --
Accounts receivable, net.................................. 1,581,011 814,892
Notes receivable.......................................... 4,978,000 --
Prepaid expenses and other current assets................. 658,468 145,120
Assets of discontinued operations held for sale........... -- 640,000
------------ -----------
Total current assets.............................. 16,848,886 1,600,012
------------ -----------
Property and equipment, net................................. 1,095,281 304,166
Goodwill, net............................................... 5,097,620 11,348,425
Other assets................................................ 305,976 305,976
------------ -----------
Total assets...................................... $ 23,347,763 $13,558,579
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Bank overdraft............................................ $ -- $ 107,702
Notes payable and short-term debt......................... 142,817 3,351,163
Accounts payable.......................................... 874,187 1,976,411
Accrued expenses and other current liabilities............ 2,117,194 1,776,783
Accrued stock compensation................................ -- 638,300
------------ -----------
Total current liabilities......................... 3,134,198 7,850,359
Long-term debt.............................................. 81,375 36,463
------------ -----------
Total liabilities................................. 3,215,573 7,886,822
------------ -----------
Stockholders' equity:
Preferred stock........................................... -- --
Common stock.............................................. 89,847 40,627
Additional paid-in capital................................ 48,587,104 15,481,923
Accumulated deficit....................................... (27,393,423) (8,835,482)
------------ -----------
Total............................................. 21,283,528 6,687,068
Less notes receivable from stockholders................... (1,151,338) (1,015,311)
------------ -----------
Total stockholders' equity........................ 20,132,190 5,671,757
Commitments and contingencies
------------ -----------
Total liabilities and stockholder's equity........ $ 23,347,763 $13,558,579
============ ===========
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-20
<PAGE> 143

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
---------------------------- ---------------------------
2000 1999 2000 1999
------------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net revenues........................... $ 1,982,829 $ -- $ 3,574,154 --
Less:
Cost of revenues....................... 1,711,411 -- 3,144,621 --
Loss on contractual services........... -- -- 250,000 --
Sales and marketing expenses........... 588,451 -- 903,916 --
General and administrative expenses.... 1,200,681 -- 1,939,630 --
Stock compensation expense............. 125,928 -- 2,398,978 --
Impairment charge...................... -- -- 5,637,401 --
Depreciation and amortization.......... 76,676 -- 120,212 --
Goodwill amortization.................. 306,702 -- 613,404 --
----------- ---------- ------------ ------------
Operating loss............... (2,027,050) -- (11,434,008) --
Interest income, net................... 247,307 -- 299,567 --
----------- ---------- ------------ ------------
Loss from continuing
operations before income
taxes and extraordinary
item....................... (1,779,743) -- (11,134,441) --
Income taxes from continuing
operations........................... -- -- -- (398,294)
----------- ---------- ------------ ------------
Loss from continuing
operations before
extraordinary item......... (1,779,743) -- (11,134,441) --
Discontinued operations
Loss from discontinued
operations................. -- (88,838) -- (398,294)
Loss on disposal of
discontinued operations.... -- -- (236,000) --
----------- ---------- ------------ ------------
Loss before extraordinary
item....................... (1,779,743) (88,838) (11,370,441) (398,294)
Extraordinary Item:
Loss from debt conversion.... -- -- (7,187,500) --
----------- ---------- ------------ ------------
Net loss..................... $(1,779,743) $ (88,838) (18,557,941) (398,294)
=========== ========== ============ ============
Loss per share -- basic and diluted:
Loss before discontinued
operations and
extraordinary items........ $ (0.20) $ -- $ (1.41) $ --
Discontinued operations...... -- (0.06) (0.03) (0.28)
----------- ---------- ------------ ------------
Loss before extraordinary
items...................... (0.20) (0.06) (1.44) (0.28)
Loss from debt conversion.... -- -- (0.91) --
----------- ---------- ------------ ------------
Net loss..................... $ (0.20) $ (0.06) $ (2.36) $ (0.28)
=========== ========== ============ ============
Weighted average shares
outstanding................ 8,960,674 1,446,135 7,876,377 1,404,603
=========== ========== ============ ============
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-21
<PAGE> 144

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

JUNE 30, 2000

(UNAUDITED)

<TABLE>
<CAPTION>
COMMON ADDITIONAL
------------------- PAID-IN
SHARES AMOUNT CAPITAL
--------- ------- -----------
<S> <C> <C> <C>
Balances at December 31, 1999............................... 4,062,604 $40,627 $15,481,923
Issuance of common stock in private placement, including
placement agency shares................................... 4,084,955 40,850 19,575,950
Conversion of debt and expenses for common stock............ 751,381 7,514 9,951,987
Issuance of common stock for options exercised.............. 68,421 684 126,486
Stock compensation.......................................... -- -- 3,039,084
Adjustment of issuance of common stock and note receivable
to acquire common stock in connection with acquisition.... (50,000) (500) 500
Common stock issued for services............................ 67,153 672 411,174
Net loss.................................................... -- -- --
--------- ------- -----------
Balances at June 30, 2000................................... 8,984,514 $89,847 $48,587,104
========= ======= ===========
</TABLE>

<TABLE>
<CAPTION>
NOTES
ACCUMULATED RECEIVABLE FROM
DEFICIT STOCKHOLDERS TOTAL
------------ --------------- ------------
<S> <C> <C> <C>
Balances at December 31, 1999....................... $ (8,835,482) $(1,015,311) $ 5,671,757
Issuance of common stock in private placement,
including placement agency shares................. -- -- 19,616,800
Conversion of debt and expenses for common stock.... -- -- 9,959,501
Issuance of common stock for options exercised...... -- -- 127,170
Stock compensation.................................. -- -- 3,039,084
Adjustment of issuance of common stock and note
receivable to acquire common stock in connection
with acquisition.................................. -- (136,027) (136,027)
Common stock issued for services.................... -- -- 411,846
Net loss............................................ (18,557,941) -- (18,557,941)
------------ ----------- ------------
Balances at June 30, 2000........................... $(27,393,423) $(1,151,338) $ 20,132,190
============ =========== ============
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-22
<PAGE> 145

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
---------------------------
2000 1999
------------ ------------
<S> <C> <C>
Operating activities:
Continuing operations:
Loss from continuing operations......................... $(18,321,941) $ --
Adjustments to reconcile net loss to net cash provided
by continuing operating activities:
Depreciation and amortization......................... 733,616 --
Impairment charge..................................... 5,637,401 --
Noncash stock compensation............................ 2,398,978 --
Accounts receivable allowances........................ (277,576) --
Amortization of debt discount......................... 73,341 --
Loss from debt conversion............................. 7,187,501 --
Changes in operating assets and liabilities:
Accounts receivable................................. (488,543) --
Prepaid expenses and other current assets........... 126,652 --
Accounts payable.................................... (619,599) --
Accrued expenses and other liabilities.............. 342,213 --
------------ ------------
Net cash used in continuing operating
activities...................................... (3,207,957) --
------------ ------------
Discontinued operations:
Loss from discontinued operations....................... -- (398,294)
Adjustment to reconcile loss from discontinued
operations to net cash provided by discontinued
operations............................................. -- 252,352
Loss on disposal of discontinued operations............. (236,000) --
------------ ------------
Net cash used in discontinued operating
activities...................................... (236,000) (145,942)
------------ ------------
Net cash used in operating activities............. (3,443,957) (145,942)
------------ ------------
Investing activities:
Continuing operations:
Net cash used in investing activities for continuing
operations -- Additions to property and equipment...... (486,327) --
------------ ------------
Discontinued operations:
Increase in resource property........................... -- (240,891)
Additions to property and equipment..................... -- (6,761)
------------ ------------
Net cash used in investing activities............. (486,327) (247,652)
------------ ------------
Financing activities:
Decrease in bank overdraft................................ (107,702) --
Borrowings under capital lease obligations................ 87,729 --
Proceeds from borrowings from note payable................ 400,000 --
Repayments of long-term debt.............................. (1,073,504) --
Issuance of notes receivable.............................. (4,978,000) --
Increase in note receivable shareholder................... (136,027) --
Issuance of common stock.................................. 19,369,195 --
------------ ------------
Net cash provided from financing activities for
continuing operations........................... 13,561,691 --
Discontinued operations:
Proceeds from debt financing............................ -- 126,393
Payment of long-term debt............................... -- (5,175)
------------ ------------
Net cash provided by financing activities for
discontinued operations......................... -- 121,218
------------ ------------
Net cash provided by financing activities......... 13,561,691 121,218
------------ ------------
Net increase (decrease) in cash and cash
equivalents..................................... 9,631,407 (272,376)
Cash and cash equivalents at beginning of period............ -- --
------------ ------------
Cash and cash equivalents at end of period.................. $ 9,631,407 $ (272,376)
============ ============
Supplemental disclosures of cash flow information:
Cash paid during the period for continuing operations:
Interest.............................................. 41,426 90,160
Supplemental disclosures of noncash investing and financing
activities:
Issuance of debt for businesses acquired.............. (576,000) --
Common stock granted for services..................... 411,850 --
Exchange of non-monetary assets....................... (425,000) --
Conversion of debt for common stock................... 589,150 --
</TABLE>

See accompanying notes to condensed consolidated financial statements.

F-23
<PAGE> 146

CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2000

(UNAUDITED)

(1) BUSINESS AND BASIS OF PRESENTATION

Cereus Technology Partners, Inc. and subsidiaries ("Cereus"), was formerly
named AIM Group, Inc. prior to December 1, 1999. Prior to July 31, 1999, Cereus
operated a surface modification facility in Arkansas for industrial minerals
used as fillers and endeavored to develop a cement additive application for a
silica/kaolinite rock mined on property leased by Cereus in Arizona. On March
31, 2000, Cereus entered into an agreement to sell its mineral businesses to
Cereus's former Chairman of the Board for an aggregate consideration of
approximately $1.0 million (the "Mineral Transaction"). Accordingly, the surface
modification and mining operations have been reflected as discontinued
operations in the accompanying consolidated financial statements. The Mineral
Transaction was closed in April 2000.

In 1999, Cereus acquired three companies that provided information
technology services and began providing business software implementation and
consulting and internet services. On July 30, 1999, Cereus acquired The Reddy
Group, Inc. and its wholly-owned subsidiary, Cereus Bandwidth LLC (collectively,
"Cereus Bandwidth"), an Atlanta-based Internet service provider ("ISP") which
developed and through which Cereus currently markets a variety of Internet,
intranet and e-commerce services. On July 30, 1999, Cereus acquired Enterprise
Solutions Group, Inc. ("ESG"), a West Palm Beach based business software
applications consulting firm. On November 15, 1999, Cereus acquired Client
Server Solutions, Inc. and an affiliated company (collectively, "CSS"), an
Atlanta-based business software sales and service company. ESG and CSS are
focused on enterprise resource planning ("ERP") applications consisting of
integrated financial, administrative, payroll and human resource, manufacturing,
distribution, point-of-sale and inventory management software. The applications
are supported by software that includes management information systems and
database management of sales and marketing information.

On June 12, 2000, Eltrax Systems, Inc. ("Eltrax") and Cereus entered into a
definitive agreement and plan of merger, which was amended and restated as of
July 27, 2000, pursuant to which Cereus will become a wholly-owned subsidiary of
Eltrax. The merger will be structured as a tax-free reorganization and accounted
for as a purchase. In the merger, each Cereus share will be converted into 1.75
shares of Eltrax's stock, but the exchange rate may be adjusted downward to
1.667 shares of Eltrax's common stock for each share of Cereus common stock if
Cereus does not before September 1, 2000, provide Eltrax with the additional
$5.0 million in borrowing availability under the bridge facility noted above. If
the exchange rate is adjusted to 1.667 of Eltrax common stock for each share of
Cereus common stock, then the exchange ratio may be further adjusted downward if
Eltrax sells, in one or more transactions, all or any part of hospitality group
for $8.0 million or more in cash in the aggregate on or before the effective
time of the merger. The transaction is subject to approval by the shareholders
of both companies and other customary conditions and regulatory approvals. The
merger is expected to close in the third quarter of 2000.

(2) DISCONTINUED OPERATIONS

Until July 31, 1999 Cereus was primarily a mining and mined products
company. During 1999, Cereus decided to change its business model to become a
technology services company. To accomplish this objective, Cereus acquired three
technology consulting companies, changed its name and decided to discontinue its
mining operations business.

In March 2000, Cereus executed a sale agreement with Cereus's former
Chairman of the Board to sell the mining business; the transaction closed in
April 2000. This agreement specified a purchase price of approximately $640,000
for the stock of all mining subsidiaries plus approximately $340,000 of working
capital contributions to be provided by Cereus. The consideration was in the
form of an interest-bearing note, due in 180 days, unless called earlier by
Cereus based upon certain rights. This note is secured by

F-24
<PAGE> 147
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

the pledge of 84,000 shares of Cereus's stock held by the former Chairman and
the stock of certain of the subsidiaries sold.

Cereus retained no subsequent interests in any mining operations or assets,
no liabilities, expressed or contingent with respect to the mining operations,
and the ultimate payment of the note is not tied in any form to the results of
the mining operations.

The sales price approximates the fair market value of the assets, as
determined by an independent appraiser. Therefore, Cereus wrote down the book
value of its mining operations to this fair market value and accrued for
transaction costs and severance obligations associated with the disposition in
the fourth quarter of 1999. An additional loss on disposal of discontinued
operations of approximately $236,000 was recorded for the quarter ended March
31, 2000, reflecting an adjustment to the write-down of the book value of the
mining companies that was recorded in the fourth quarter of 1999. In accordance
with generally accepted accounting principles Cereus's prior period financial
statements have been reclassified to reflect the results of the discontinued
operations.

(3) GOODWILL AND IMPAIRMENT CHARGE

During the quarter ended March 31, 2000 Cereus hired new management,
appointed a new board of directors and changed its strategic direction from an
ERP implementation and consulting business to a web integration and application
service provider business. As a result, management evaluated its net investments
in the recently acquired companies and based upon its projections of expected
future cash flows over a five year period, discounted using a 12% interest rate,
determined that the investments in the companies previously engaged in ERP
software sales and implementation services were impaired. Accordingly, Cereus
recognized an impairment charge of approximately $5.6 million during the quarter
ended March 31, 2000.

(4) STOCK-BASED COMPENSATION

During the quarter ended March 31, 2000 stock issued to certain employees
pursuant to contingent payment obligations under amended terms of the CSS
acquisition as well as purchases of stock and warrants by members of management
under terms of the private equity placement and warrants issued to consultants
resulted in stock compensation expense of approximately $2.3 million.

(5) LOSS ON COMMITMENTS AND CONTINGENCIES

Loss on contractual services of approximately $250,000 related to
commitments entered into prior to the new management team and its repositioning
of the business to focus on business to business e-commerce was recognized in
the first quarter 2000. The loss is recognized based on management's evaluation
that any future economic benefits from these commitments are not probable given
the repositioning of the business and the amount of the loss can be reasonably
estimated.

(6) DEBT

During the quarter ended March 31, 2000, Cereus retired approximately $2
million of its notes payable outstanding as of December 31, 1999 through a
conversion of the notes into a combination of stock and warrants. In addition
another $440,000 of notes issued in January, 2000 were converted into stock and
warrants, and Cereus settled certain other amounts payable through the issuance
of common stock and warrants. Approximately $1 million of the notes were
converted pursuant to their original terms and accordingly no gain or loss on
the extinguishment of debt was recognized. The remaining notes payable and other
payables were extinguished based upon terms not pursuant to the original
obligations. Accordingly, Cereus recognized a loss on extinguishment of
approximately $7.2 million based upon the

F-25
<PAGE> 148
CEREUS TECHNOLOGY PARTNERS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

difference between the fair value of the stock and warrants issued and the
carrying value of the debt extinguished as measured at the dates of the
extinguishment.

(7) STOCK, OPTIONS AND WARRANTS

On February 8, 2000, Cereus consummated the private placement (the "Private
Placement") of 4,000,000 shares of Cereus's common stock (the "Common Stock").
The placement was for 1,600 units (the "Units"), with each Unit having a
Purchase Price of $12,500 and consisting of 2,500 shares of Common Stock and a
warrant (the "Warrant") to purchase 2,500 shares of Common Stock at an exercise
price of $10.00 per share. The Warrant expires three (3) years after its
issuance and may be redeemed by the Company if the closing bid price for the
Common Stock is equal to or greater than 100% of the exercise price of the
Warrant for twenty (20) consecutive trading days, provided that a registration
statement covering the shares of Common Stock to be issued upon exercise of the
Warrants is then effective.

Cereus received gross proceeds of $20 million from the private placement.
Cereus intends to use such proceeds to make strategic acquisitions, to meet
working capital requirements and for general corporate purposes.

In connection with the Private Placement, Cereus incurred placement agency
fees consisting of approximately $760,000 in cash, issued an aggregate of 84,955
shares of Common Stock, warrants to purchase an aggregate of 84,955 shares of
Common Stock at an exercise price of $10.00 per share (in each case, on terms
identical to the Warrants), and warrants to purchase an aggregate of 336,750
shares of Common Stock at an exercise price of $5.50 per share.

The Units offered and sold in the Private Placement were not registered
under the Securities Act of 1933, as amended (the "Securities Act"), in reliance
upon the exemption therefrom provided by Section 4(2) of the Securities Act.

In addition to the 4,000,000 shares of Common Stock and warrants to
purchase 4,000,000 shares of Common Stock (exercisable at $10.00) issued in
connection with the private placement and the 84,955 stock and warrants to
purchase 421,705 shares of Common Stock issued to placement agency firms, other
significant activity during the first quarter included: 751,381 shares of Common
Stock and warrants to purchase 929,918 shares of Common Stock (exercisable at
prices between $3.75 and $10.00) were issued for conversion of debt and
settlement of expenses, as well as 52,632 shares of common stock for contractual
services; warrants to purchase 2,630,000 shares of Common Stock were issued to
members of the new executive management and new board of director members (at
exercise prices from $3.75 to $17.75).

F-26
<PAGE> 149

APPENDIX A

SECOND AMENDED AND RESTATED

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

ELTRAX SYSTEMS, INC.,

SOLEMN ACQUISITION CORPORATION
AND

CEREUS TECHNOLOGY PARTNERS, INC.

DATED AS OF JULY 27, 2000
<PAGE> 150

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE I THE MERGER
SECTION 1.1 The Merger.................................................. A-1
SECTION 1.2 Effective Time of the Merger................................ A-1
SECTION 1.3 Certificate of Incorporation................................ A-1
SECTION 1.4 Bylaws...................................................... A-2
SECTION 1.5 Officers.................................................... A-2
SECTION 1.6 Directors................................................... A-2
ARTICLE II CONVERSION OF SHARES
SECTION 2.1 Conversion of Cereus Shares and Options..................... A-2
SECTION 2.2 Conversion of Cereus Acquiring Sub Shares................... A-3
SECTION 2.3 Exchange of Cereus Certificates............................. A-3
SECTION 2.4 No Fractional Securities.................................... A-4
SECTION 2.5 Closing..................................................... A-4
SECTION 2.6 Closing of Cereus Transfer Books............................ A-4
ARTICLE III REPRESENTATIONS AND WARRANTIES OF CEREUS
SECTION 3.1 Organization and Qualification.............................. A-5
SECTION 3.2 Capitalization.............................................. A-5
SECTION 3.3 Subsidiaries................................................ A-5
SECTION 3.4 Authority; Non-Contravention; Approvals..................... A-6
SECTION 3.5 Reports and Financial Statements............................ A-7
SECTION 3.6 Employee Benefit Plans; Labor Matters; No Parachute
Payments.................................................... A-7
SECTION 3.7 Certain Tax Matters......................................... A-9
SECTION 3.8 Contracts; Debt Instruments................................. A-9
SECTION 3.9 Litigation.................................................. A-9
SECTION 3.10 Intellectual Property....................................... A-10
SECTION 3.11 Taxes....................................................... A-10
SECTION 3.12 Interested Party Transactions............................... A-10
SECTION 3.13 Absence of Certain Changes or Events........................ A-10
SECTION 3.14 Registration Statement and Proxy Statement.................. A-11
SECTION 3.15 Reorganization.............................................. A-11
SECTION 3.16 Brokers and Finders......................................... A-11
SECTION 3.17 Opinion of Financial Advisor................................ A-11
SECTION 3.18 Hazardous Substances and Hazardous Waste.................... A-11
SECTION 3.19 Disclosure.................................................. A-12
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND CEREUS ACQUIRING SUB
SECTION 4.1 Organization and Qualification.............................. A-12
SECTION 4.2 Capitalization.............................................. A-12
SECTION 4.3 Subsidiaries................................................ A-13
SECTION 4.4 Authority; Non-Contravention; Approvals..................... A-13
SECTION 4.5 Reports and Financial Statements............................ A-14
SECTION 4.6 Employee Benefit Plans; Labor Matters; No Parachute
Payments.................................................... A-15
SECTION 4.7 Certain Tax Matters......................................... A-16
SECTION 4.8 Contracts; Debt Instruments................................. A-16
SECTION 4.9 Litigation.................................................. A-17
SECTION 4.10 Intellectual Property....................................... A-17
SECTION 4.11 Taxes....................................................... A-17
SECTION 4.12 Interested Party Transactions............................... A-17
SECTION 4.13 Absence of Certain Changes or Events........................ A-18
SECTION 4.14 Registration Statement and Proxy Statement.................. A-18
</TABLE>

i
<PAGE> 151

<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 4.15 Reorganization.............................................. A-18
SECTION 4.16 Brokers and Finders......................................... A-18
SECTION 4.17 Opinion of Financial Advisor................................ A-18
SECTION 4.18 Hazardous Substances and Hazardous Waste.................... A-18
SECTION 4.19 Disclosure.................................................. A-19
ARTICLE V CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 5.1 Transition Matters.......................................... A-19
SECTION 5.2 Conduct of Business by Parent and Cereus Pending the
Merger...................................................... A-20
SECTION 5.3 Acquisition Transactions.................................... A-21
ARTICLE VI ADDITIONAL AGREEMENTS
SECTION 6.1 Access to Information....................................... A-22
SECTION 6.2 Registration Statement and Proxy Statement.................. A-23
SECTION 6.3 Stockholders' Approvals..................................... A-23
SECTION 6.4 Compliance with the Securities Act.......................... A-23
SECTION 6.5 Expenses and Fees........................................... A-23
SECTION 6.6 Agreement to Cooperate...................................... A-24
SECTION 6.7 Public Statements........................................... A-25
SECTION 6.8 Notification of Certain Matters............................. A-25
SECTION 6.9 Directors' and Officers' Indemnification.................... A-25
SECTION 6.10 Corrections to the Joint Proxy Statement/Prospectus and
Registration
Statement................................................... A-25
SECTION 6.11 Listing..................................................... A-25
SECTION 6.12 Parent Board of Directors................................... A-25
SECTION 6.13 Bridge Facility............................................. A-26
SECTION 6.14 Employment Agreements....................................... A-26
SECTION 6.15 Executive Officers of Parent................................ A-26
SECTION 6.16 Reverse Stock Split; Corporate Name......................... A-26
ARTICLE VII CONDITIONS
SECTION 7.1 Conditions to Each Party's Obligation to Effect the
Merger...................................................... A-26
SECTION 7.2 Additional Conditions to Obligation of Cereus to Effect the
Merger...................................................... A-27
SECTION 7.3 Additional Conditions to Obligation of Parent to Effect the
Merger...................................................... A-28
ARTICLE VIII TERMINATION, AMENDMENT AND WAIVER
SECTION 8.1 Termination................................................. A-28
SECTION 8.2 Effect of Termination....................................... A-29
SECTION 8.3 Amendment................................................... A-29
SECTION 8.4 Waiver...................................................... A-29
SECTION 8.5 Termination Fees and Expenses............................... A-30
ARTICLE IX GENERAL PROVISIONS
SECTION 9.1 Non-Survival of Representations and Warranties.............. A-30
SECTION 9.2 Notices..................................................... A-31
SECTION 9.3 Interpretation.............................................. A-32
SECTION 9.4 Governing Law............................................... A-32
SECTION 9.5 Arbitration................................................. A-32
SECTION 9.6 Counterparts, Telecopied Signatures......................... A-32
SECTION 9.7 Parties in Interest......................................... A-32
SECTION 9.8 Miscellaneous............................................... A-32
</TABLE>

ii
<PAGE> 152

SECOND AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER

THIS SECOND AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, dated as of
July 27, 2000 (the "AGREEMENT"), is by and among ELTRAX SYSTEMS, INC., a
Minnesota corporation ("PARENT"), SOLEMN ACQUISITION CORPORATION, a Delaware
corporation and a wholly owned subsidiary of Parent ("CEREUS ACQUIRING SUB"),
and CEREUS TECHNOLOGY PARTNERS, INC., a Delaware corporation ("CEREUS"). Parent
and Cereus are sometimes together referred to collectively as the "COMPANIES"
and, individually, as a "COMPANY".

RECITALS

A. The Boards of Directors of Parent, Cereus Acquiring Sub and Cereus have
approved the merger of Cereus Acquiring Sub with and into Cereus, upon the terms
and subject to the conditions set forth herein (the "MERGER"), and deem it
advisable and in the best interests of their respective shareholders that the
Merger be consummated.

B. For federal income tax purposes, the parties intend to adopt this
Agreement as a tax-free reorganization and to consummate the Merger in
accordance with the provisions of Section 368 of the Internal Revenue Code of
1986, as amended (the "CODE"), and the regulations promulgated thereunder.

C. The parties desire to make certain representations, warranties,
covenants and agreements in connection with the transactions contemplated by
this Agreement (the "TRANSACTIONS").

D. On June 12, 2000 the parties executed an Agreement and Plan of Merger
(the "ORIGINAL AGREEMENT"). On July 14, 2000, the parties amended various terms
of the Original Agreement, and executed a First Amendment to Agreement and Plan
of Merger (the "FIRST AMENDMENT").

E. The boards of directors of each of Parent, Cereus Acquiring Sub and
Cereus have determined that it is fair to and in the best interests of their
respective stockholders to further amend the Original Agreement and the First
Amendment, and to restate in full their mutual agreements and understandings
regarding the Transactions in this Second Amended and Restated Agreement and
Plan of Merger.

NOW, THEREFORE, in consideration of the mutual representations, warranties
and covenants contained herein, the parties hereto agree as follows:

ARTICLE I
THE MERGER

SECTION 1.1 The Merger. Upon the terms and subject to the conditions of
this Agreement, at the Effective Time (as defined in Section 1.2) and in
accordance with the General Corporation Law of the State of Delaware, as amended
(the "DGCL"), Cereus Acquiring Sub shall be merged with and into Cereus and the
separate existence of Cereus Acquiring Sub shall thereupon cease. Cereus shall
be the surviving corporation in the Merger and a wholly-owned subsidiary of
Parent and is hereinafter sometimes referred to as the "SURVIVING CORPORATION."

SECTION 1.2 Effective Time of the Merger. The Merger shall become
effective at such time (the "EFFECTIVE TIME") as shall be stated in a
certificate of merger, in a form mutually acceptable to Parent and Cereus, to be
filed with the Secretary of State of the State of Delaware in accordance with
the DGCL (the "MERGER FILING"), concurrently with the closing of the
Transactions in accordance with Section 2.5.

SECTION 1.3 Certificate of Incorporation. The Certificate of Incorporation
of the Surviving Corporation as in effect immediately prior to the Effective
Time shall, after the Effective Time, be the Certificate of Incorporation of
Cereus Acquiring Sub, and thereafter may be amended in accordance with their
terms and as provided in the DGCL.

A-1
<PAGE> 153

SECTION 1.4 Bylaws. The Bylaws of the Surviving Corporation as in effect
immediately prior to the Effective Time shall, after the Effective Time, be the
Bylaws of Cereus Acquiring Sub and (subject to Section 6.9) thereafter may be
amended in accordance with their terms and as provided by the Certificate of
Incorporation of the Surviving Corporation and the DGCL.

SECTION 1.5 Officers. The officers of the Surviving Corporation after the
Effective Time shall be the officers of Cereus Acquiring Sub in office
immediately prior to the Effective Time, until their successors are elected or
appointed and qualified or until their resignation or removal.

SECTION 1.6 Directors. The directors of the Surviving Corporation after
the Effective Time shall be the directors of Cereus Acquiring Sub in office
immediately prior to the Effective Time, until their successors are elected or
appointed and qualified or until their resignation or removal.

ARTICLE II
CONVERSION OF SHARES

SECTION 2.1 Conversion of Cereus Shares and Options. At the Effective
Time, by virtue of the Merger and without any action on the part of any holder
of any capital stock of Cereus:

(a) Subject to paragraphs (b), (e) and (f) of this Section 2.1, each share
of the common stock, par value $.01 per share, of Cereus (the "CEREUS COMMON
STOCK") issued and outstanding immediately prior to the Effective Time shall be
converted into the right to receive, without interest, 1.75 fully paid and
nonassessable shares (the "EXCHANGE RATIO") of the common stock, par value $.01
share of Parent ("PARENT COMMON STOCK");

(b) Each share of Cereus Common Stock held by Cereus or any of its
Subsidiaries (as defined in Section 3.3), and any shares of Cereus Common Stock
owned by Parent, Cereus Acquiring Sub or any other Subsidiary of Parent, other
than shares under any existing employee benefit plan which are held by either
Company as trustee, shall be cancelled;

(c) Each option or warrant granted by Cereus to purchase shares of Cereus
Common Stock that is outstanding and unexercised immediately prior thereto (an
"CEREUS STOCK OPTION"), whether vested or unvested at the Effective Time, shall
cease to represent a right to acquire shares of Cereus Common Stock and shall be
converted automatically into an option to purchase a number of shares of Parent
Common Stock (a "PARENT OPTION") equal to the number of shares of Cereus Common
Stock that could be purchased under such Cereus Stock Option multiplied by the
Exchange Ratio, at a price per share of Parent Common Stock equal to the per
share exercise price of such Cereus Stock Option divided by the Exchange Ratio;
provided, however, that any fractional shares of Parent Common Stock resulting
from such determination shall be rounded down to the nearest share. The
adjustments provided herein with respect to any Cereus Stock Option that is an
"incentive stock option" (as defined in section 422 of the Code) shall be and
are intended to be effected in a manner that is consistent with section 424(a)
of the Code;

(d) Any Cereus plans governing the issuance and administration of the
Cereus Stock Options (the "CEREUS OPTION PLANS") shall terminate, and within 90
days following the Closing Date, each holder of a Cereus Stock Option will
receive an award agreement with respect to the Parent Options they acquire
pursuant to Section 2.1(c) above, which shall preserve the remaining exercise
period and vesting schedule (if any) of such converted Cereus Stock Options and,
if applicable, shall preserve the status of any converted Cereus Stock Options
as "incentive stock options" (as defined in Section 422 of the Code). Cereus
shall take all actions necessary to ensure that following the Effective Time, no
holder of Cereus Stock Options or any participant in the Cereus Option Plans or
any other plans, programs, agreements or arrangements shall have any right
thereunder to acquire any equity securities of Cereus, the Surviving Corporation
or any subsidiary of either of the foregoing;

(e) Notwithstanding anything in this Agreement to the contrary, any issued
and outstanding shares of Cereus Common Stock held by a Cereus stockholder
entitled to and validly exercising appraisal rights
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pursuant to Section 262 of the DGCL (a "DISSENTING STOCKHOLDER") shall not be
converted as described in Section 2.1(a) but, as of the Effective Time, shall no
longer be outstanding and shall automatically be canceled and retired and shall
cease to exist and shall become the right to receive such consideration as may
be determined to be due such Dissenting Stockholder pursuant to the laws of the
State of Delaware; provided, however, that the shares of Cereus Common Stock
outstanding immediately prior to the Effective Time and held by a Dissenting
Stockholder who shall, after the Effective Time, withdraw his or her demand for
appraisal or lose his or her right of appraisal, in either case pursuant to the
DGCL shall be deemed to be converted at the Effective Time into the right to
receive shares of Parent Common Stock in accordance with Section 2.1(a). Cereus
shall give Parent (i) prompt notice of any written demands for appraisal of
shares of Cereus Common Stock received by Cereus and (ii) the opportunity to
participate in all negotiations and proceedings with respect to any such
demands; and

(f) If Cereus has not executed the Cereus Amended Loan Documents (as
defined in Section 6.13) by September 1, 2000, (provided, however, that if the
PNC Conditions (as defined in Section 6.13) have not been satisfied by such
date, then such date shall be extended to September 18, 2000 provided that
Cereus is negotiating in good faith to satisfy the PNC Conditions) then the
exchange ratio shall be 1.667; provided, however, that if Parent sells (in one
or more transactions) any part of its Hospitality Services Group (as defined in
Parent's Form 10-K for the fiscal year ended December 31, 1999) for $8.0 million
or more in cash in the aggregate at or prior to the Effective Time, in one or
more transactions consented to in writing by Cereus, which consent will not be
unreasonably withheld or delayed (and which consent will be granted if the
consideration for the assets of the Hospitality Services Group (the "HOSPITALITY
ASSETS") proposed to be in sold in such transaction or transactions is not
materially less than the estimated value thereof previously agreed to by the
Companies in writing), then the Exchange Ratio shall decrease (i) by an amount
equal to (1) .007 divided by (2) 1,000,000 for each $1.00 in cash received by
Parent at or prior to the Effective Time upon the sale of such assets; and (ii)
an amount equal to (1) .0035 divided by (2) 1,000,000 for each $1.00 in
principal amount payable to Parent on or prior to the one year anniversary of
the Closing Date (as defined in Section 2.5) pursuant to the terms of any full
recourse promissory note received by Parent upon the sale of such assets,
provided that the repayment of such promissory note is not contingent upon any
post-closing event or performance and is not subject to any contractual right of
set off and that such promissory note is adequately secured, bears interest at a
market rate, and has a fixed repayment schedule and principal amount.

SECTION 2.2 Conversion of Cereus Acquiring Sub Shares. At the Effective
Time, by virtue of the Merger and without any action on the part of Parent, each
issued and outstanding share of common stock, $.01 par value per share, of
Cereus Acquiring Sub shall be converted into one share of common stock, $.01 par
value per share of the Surviving Corporation.

SECTION 2.3 Exchange of Cereus Certificates.

(a) From and after the Effective Time, each holder of an outstanding
certificate which immediately prior to the Effective Time represented shares of
Cereus Common Stock (individually, a "CERTIFICATE" and, collectively, the
"CERTIFICATES"), shall receive in exchange therefor, upon surrender thereof to
an exchange agent reasonably satisfactory to Parent (the "EXCHANGE AGENT"), a
certificate or certificates representing the number of whole shares of Parent
Common Stock to which such holder is entitled pursuant to Section 2.1 based on
the Exchange Ratio. Notwithstanding any other provision of this Agreement, (i)
until holders or transferees of Certificates have surrendered them for exchange
as provided herein, no dividends or other distributions shall be paid with
respect to any shares represented by such Certificates and no payment for
fractional shares shall be made and (ii) without regard to when such
Certificates representing shares of Cereus Common Stock are surrendered for
exchange as provided herein, no interest shall be paid on any dividends or other
distributions or any payment for fractional shares. Upon surrender of a
Certificate, there shall be paid to the holder of such Certificate the amount of
any dividends or other distributions which became payable, but which were not
paid by reason of the foregoing, with respect to the number of whole shares of
Parent Common Stock represented by the certificate or certificates issued upon
such surrender.

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(b) On the Closing Date, Parent shall make available to the Exchange Agent,
for the benefit of each holder of Cereus Common Stock, a sufficient number of
certificates representing shares of Parent Common Stock required to effect the
exchanges referred to in paragraph (a) above and cash for payment of any
fractional shares referred to in Section 2.4.

(c) Promptly after the Effective Time, the Exchange Agent shall mail to
each holder of record of a Certificate or Certificates (as shown on the books of
Cereus's Exchange Agent as of the Effective Time) (i) a letter of transmittal
(which shall specify that delivery shall be effected, and risk of loss and title
to the Certificates shall pass, only upon actual delivery of the Certificates to
the Exchange Agent) and (ii) instructions for use in effecting the surrender of
the Certificates in exchange for certificates representing shares of Parent
Common Stock. Upon surrender of the Certificates for cancellation to the
Exchange Agent, together with a duly executed letter of transmittal and such
other documents as the Exchange Agent shall reasonably require, the holder of
such Certificates shall receive in exchange therefor a certificate representing
that number of whole shares of Parent Common Stock into which the shares of
Cereus Common Stock, heretofore represented by the Certificates so surrendered,
shall have been converted pursuant to the provisions of Section 2.1 based on the
Exchange Ratio, and the Certificates so surrendered shall be canceled. The
Exchange Agent shall not be entitled to vote or exercise any rights of ownership
with respect to the shares of Parent Common Stock held by it from time to time
hereunder, except that it shall receive and hold all dividends or other
distributions paid or distributed with respect to such Parent Common Stock for
the account of the persons entitled thereto.

(d) Promptly following the date which is 12 months after the Effective
Time, the Exchange Agent shall deliver to Parent all cash, certificates
(including any Parent Common Stock) and other documents in its possession
relating to the Transactions, and the Exchange Agent's duties shall terminate.
Thereafter, any holders of Certificates shall contact Parent directly in order
to exchange such Certificates for shares of Parent Common Stock.

SECTION 2.4 No Fractional Securities. Notwithstanding any other provision
of this Agreement, no certificates or scrip representing less than one share of
Parent Common Stock shall be issued in the Merger, and no Parent Common Stock
dividend, stock split or interest shall relate to any fractional security, and
such fractional interests shall not entitle the owner thereof to vote or to any
other rights of a security holder. In lieu of any such fractional shares, each
holder of shares of Cereus Common Stock who would otherwise have been entitled
to receive a fraction of a share of Parent Common Stock upon surrender of
Certificates for exchange pursuant to this Article II shall be entitled to
receive from the Exchange Agent a cash payment equal to such fraction multiplied
by the closing price per share of Parent Common Stock, as reported by The Wall
Street Journal (Eastern Edition), as of the close of business on the business
day immediately preceding the Closing Date.

SECTION 2.5 Closing. The closing (the "CLOSING") of the Transactions shall
take place simultaneously at a location mutually agreeable to Cereus and Parent
as promptly as practicable (but in any event within five business days)
following the date on which the last of the conditions set forth in Article VII
is fulfilled or waived, or at such other time and place as Parent and Cereus
shall agree. The date on which the Closing occurs is referred to in this
Agreement as the "CLOSING DATE."

SECTION 2.6 Closing of Cereus Transfer Books. At and after the Effective
Time, holders of Certificates shall cease to have any rights as stockholders of
Cereus, except for the right to receive shares of Parent Common Stock pursuant
to Section 2.1 and the right to receive cash for payment of fractional shares
pursuant to Section 2.4. At the Effective Time, the stock transfer books of
Cereus shall be closed and no transfer of shares of Cereus Common Stock which
were outstanding immediately prior to the Effective Time shall thereafter be
made. If, after the Effective Time, subject to the terms and conditions of this
Agreement, Certificates are presented to Parent or the Surviving Corporation,
they shall be canceled and exchanged for shares of Parent Common Stock in
accordance with this Article II.

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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF CEREUS

Except as disclosed in the Cereus SEC Reports (as defined in Section 3.5)
or as set forth in the Restated Cereus Disclosure Schedule delivered by Cereus
to Parent prior to the execution of this Agreement (the "CEREUS DISCLOSURE
SCHEDULE"), Cereus represents and warrants to Parent that the following
statements are true and correct as of the date hereof.

SECTION 3.1 Organization and Qualification. Cereus is a corporation duly
organized, validly existing and in good standing under the laws of the state of
Delaware and has the requisite corporate power and authority to own, lease and
operate its assets and properties and to carry on its business as it is now
being conducted. Cereus is qualified to do business and is in good standing in
each jurisdiction in which the properties owned, leased or operated by it or the
nature of the business conducted by it makes such qualification necessary,
except where the failure to be so qualified and in good standing will not, when
taken together with all other such failures, have, or be reasonably expected to
have, a material adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of Cereus and its
Subsidiaries, taken as a whole, other than any change, circumstance or effect
(i) relating to or resulting from the economy or securities markets in general,
(ii) relating to or resulting from the industries in which Cereus or Parent
operate and not uniquely relating to Cereus or Parent, or (iii) resulting from
the announcement or existence of the Original Agreement, this Agreement or the
Transactions (a "CEREUS MATERIAL ADVERSE EFFECT"), and copies of good standing
certificates evidencing such qualification will be delivered to Parent at or
prior to the Closing, in each case bearing a date within thirty (30) days prior
to the Closing Date. True, accurate and complete copies of Cereus's Certificate
of Incorporation and Bylaws, in each case as in effect the date hereof,
including all amendments thereto, have been delivered to Parent. All
jurisdictions in which Cereus owns, uses or operates property, and any
qualifications in such jurisdictions, are listed on Schedule 3.1.

SECTION 3.2 Capitalization.

(a) On June 12, 2000, the authorized capital stock of Cereus consisted of
50,000,000 shares of Cereus Common Stock and 10,000,000 shares of preferred
stock, par value $.01 per share ("CEREUS PREFERRED STOCK"). As of June 9, 2000,
(i) 8,961,953 shares of Cereus Common Stock were issued and outstanding, all of
which were validly issued and were fully paid, nonassessable and free of
preemptive rights, (ii) no shares of Cereus Preferred Stock were issued and
outstanding, (iii) 4,931,379 shares of Cereus Common Stock were reserved for
issuance pursuant to the Cereus Option Plans, (iv) 7,843,693 shares of Cereus
Common Stock were reserved for issuance upon exercise of outstanding warrants
and options not issued under the Cereus Option Plans, and (v) no shares of
Cereus Common Stock were reserved for issuance upon conversion of outstanding
convertible debentures and outstanding convertible notes.

(b) Except as set forth in subsection (a) above or as otherwise
contemplated by this Agreement, there are no outstanding subscriptions, options,
calls, contracts, commitments, restrictions, arrangements, rights or warrants,
including any right of conversion or exchange under any outstanding security,
instrument or other agreement, and also including any rights plan or other
anti-takeover agreement, obligating Cereus or any of its Subsidiaries to issue,
deliver or sell, or cause to be issued, delivered or sold, additional shares of
the capital stock of Cereus or obligating Cereus or any of its Subsidiaries to
grant, extend or enter into any such agreement or commitment. Except as
otherwise disclosed in the Cereus SEC Reports, there are no voting trusts,
proxies or other agreements or understandings to which Cereus or any of its
Subsidiaries is a party or is bound with respect to the voting of any shares of
capital stock of Cereus.

SECTION 3.3 Subsidiaries. Identified in Section 3.3 of the Cereus
Disclosure Schedule is each direct and indirect Subsidiary (as defined below) of
Cereus. Each such Subsidiary (i) is duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization and
has the requisite corporate power and authority to own, lease and operate its
assets and properties and to carry on its business as it is now being conducted;
and (ii) is qualified to do business, and is in good

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standing, in each jurisdiction in which the properties owned, leased or operated
by it or the nature of the business conducted by it makes such qualification
necessary, all such qualifications being listed in Section 3.3 of the Cereus
Disclosure Schedule, except in all cases where the failure to be so qualified
and in good standing would not, when taken together with all such other
failures, result in a Cereus Material Adverse Effect. At or prior to Closing,
copies of good standing certificates evidencing such qualification will be
delivered to Parent in each case bearing a date within thirty (30) days prior to
the Closing Date. All of the outstanding shares of capital stock or other equity
interests of each Subsidiary of Cereus are validly issued, fully paid,
nonassessable and free of preemptive rights, and are owned directly or
indirectly by Cereus, free and clear of any liens, claims or encumbrances. There
are no subscriptions, options, warrants, rights, calls, contracts, voting
trusts, proxies or other commitments, understandings, restrictions or
arrangements relating to the issuance, sale, voting, transfer, ownership or
other rights with respect to any shares of capital stock or other equity
interests of any Subsidiary of Cereus, including any right of conversion or
exchange under any outstanding security, instrument or agreement. As used in
this Agreement, the term "SUBSIDIARY" shall mean, when used with reference to
any person or entity, any corporation, partnership, limited liability company,
joint venture or other entity of which such person or entity (either acting
alone or together with its other Subsidiaries) owns, directly or indirectly, 50%
or more of the capital stock or other voting interests, the holders of which are
entitled to vote for the election of a majority of the board of directors or any
similar governing body of such corporation, partnership, limited liability
company, joint venture or other entity.

SECTION 3.4 Authority; Non-Contravention; Approvals.

(a) Cereus has full corporate power and authority to enter into this
Agreement and, subject to the Cereus Stockholders' Approval (as defined in
Section 6.3(a)) and the Cereus Required Statutory Approvals (as defined in
Section 3.4(c)), to consummate the Transactions. This Agreement has been
approved by the Board of Directors of Cereus and no other corporate proceeding
on the part of Cereus is necessary to authorize the execution and delivery of
this Agreement and, except for the Cereus Stockholders' Approval, the
consummation by Cereus of the Transactions. This Agreement has been duly
executed and delivered by Cereus and, assuming the due authorization, execution
and delivery by the other parties hereto, constitutes a valid and legally
binding agreement of Cereus, enforceable against it in accordance with its
terms.

(b) The execution and delivery of this Agreement by Cereus do not violate,
conflict with or result in a breach of any provision of, or constitute a default
(or an event which, with notice or lapse of time or both, would constitute a
default) under, or result in the termination of, or accelerate the performance
required by, or result in a right of termination or acceleration under, or
result in the creation of any lien, security interest, charge or encumbrance
upon any of the properties or assets of Cereus or any of its Subsidiaries under
any of the terms, conditions or provisions of (i) the respective charters or
bylaws of Cereus or any of its Subsidiaries, (ii) other than as provided in
Section 3.4(c), any statute, law, ordinance, rule, regulation, judgment, decree,
order, injunction, writ, permit or license of any court or governmental
authority applicable to Cereus or any of its Subsidiaries or any of their
respective properties or assets or (iii) except as set forth in Section 3.4(b)
of the Cereus Disclosure Schedule, any note, bond, mortgage, indenture, deed of
trust, license, franchise, permit, concession, contract, lease or other
instrument, obligation or agreement of any kind to which Cereus or any of its
Subsidiaries is now a party or by which Cereus or any of its Subsidiaries or any
of their respective properties or assets may be bound or affected. The
consummation by Cereus of the Transactions will not result in any violation,
conflict, breach, termination, acceleration or creation of liens under the
immediately preceding sentence, subject: (A) in the case of the terms,
conditions or provisions described in clause (ii) above, to obtaining (prior to
the Effective Time) the Cereus Required Statutory Approvals and the Cereus
Stockholder's Approval and (B) in the case of the terms, conditions or
provisions described in clause (iii) above, to obtaining (prior to the Effective
Time) consents required from commercial lenders, lessors or other third parties.
Excluded from the foregoing sentences of this paragraph (b), insofar as they
apply to the terms, conditions or provisions described in clauses (ii) and (iii)
of the first sentence of this paragraph (b) (and whether resulting from such
execution and delivery or consummation), are such violations, conflicts,
breaches,

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defaults, terminations, accelerations or creations of liens, security interests,
charges or encumbrances that would not, in the aggregate, result in a Cereus
Material Adverse Effect.

(c) Except for (i) the filing of the Registration Statement and Joint Proxy
Statement/Prospectus (as such terms are defined in Section 3.14) with the
Securities and Exchange Commission (the "SEC") pursuant to the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), and the Securities Act of
1933, as amended (the "SECURITIES ACT"), and the declaration of the
effectiveness by the SEC and filings with or approvals from various state blue
sky authorities, (ii) the making of the Merger Filing, (iii) the filings by
Cereus required by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR ACT"), and (iv) any required filings with or approvals from
NASDAQ or NASD (the filings and approvals referred to in clauses (i) through
(iv) are collectively referred to as the "CEREUS REQUIRED STATUTORY APPROVALS"),
no declaration, filing or registration with, or notice to, or authorization,
consent or approval of, any governmental or regulatory body or authority is
necessary for the execution and delivery of this Agreement by Cereus or the
consummation by Cereus of the Transactions, other than such declarations,
filings, registrations, notices, authorizations, consents or approvals which, if
not made or obtained, as the case may be, would not, in the aggregate, result in
a Cereus Material Adverse Effect.

SECTION 3.5 Reports and Financial Statements. Since January 1, 1997,
Cereus has filed with the SEC all forms, statements, reports and documents
(including all exhibits, post-effective amendments and supplements thereto)
required to be filed by it under each of the Securities Act, the Exchange Act
and the respective rules and regulations thereunder, all of which, as amended if
applicable, complied when filed in all material respects with all applicable
requirements of the appropriate act and the rules and regulations thereunder. No
Subsidiary of Cereus is required to file any form, report or other document with
the SEC. Cereus has previously made available to Parent, via its EDGAR filings
where available, copies (including all exhibits, post-effective amendments and
supplements thereto) of its (a) Annual Reports on Form 10-KSB (as amended on
Form 10-KSB/A) for the fiscal years ended December 31, 1999, 1998 and 1997, as
filed with the SEC, (b) proxy and information statements relating to (i) all
meetings of its stockholders (whether annual or special), (ii) actions by
written consent in lieu of a stockholders' meeting, in each case from January 1,
1998 until the date hereof, (c) all other reports, including quarterly reports,
and registration statements filed by Cereus with the SEC since January 1, 1997
(the documents referred to in clauses (a), (b) and (c) are collectively referred
to as the "Cereus SEC Reports"), and (d) all material documents associated with
the Mineral Transaction (as defined in Cereus's Form 10-KSB for the fiscal year
ended December 31, 1999). As of their respective dates, the Cereus SEC Reports
contained no untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
The audited financial statements for the fiscal year ended December 31, 1999 and
the two prior fiscal years, and the unaudited consolidated financial statements
of Cereus included in Cereus's Quarterly Reports on Form 10-QSB for the period
ended March 31, 2000 (collectively, the "CEREUS FINANCIAL STATEMENTS"), have
been prepared in accordance with United States generally accepted accounting
principles applied on a consistent basis ("GAAP") (except as may be indicated
therein or in the notes thereto) and fairly present the financial position of
Cereus and its Subsidiaries as of the dates thereof and the results of their
operations and changes in financial position for the periods then ended.

SECTION 3.6 Employee Benefit Plans; Labor Matters; No Parachute Payments.

(a) Section 3.6(a) of the Cereus Disclosure Schedule lists all employee
benefit plans (as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")) and all bonus, stock option, stock
purchase, restricted stock, incentive, deferred compensation, retiree medical or
life insurance, supplemental retirement, severance or other benefit plans,
programs or arrangements, whether legally enforceable or not, to which Cereus or
any Subsidiary of Cereus is a party, with respect to which Cereus or any
Subsidiary of Cereus has any obligation or which are maintained, contributed to
or sponsored by Cereus or any Subsidiary of Cereus for the benefit of any
current or former employee, officer or director of Cereus or any Subsidiary of
Cereus (collectively, the "CEREUS BENEFIT PLANS").
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With respect to each Cereus Benefit Plan, Cereus has delivered, or prior to
Closing will deliver, or make available to Parent a true, complete and correct
copy of (i) such Cereus Benefit Plan and the most recent summary plan
description related to such Cereus Benefit Plan, if a summary plan description
is required therefor, (ii) each trust agreement or other funding arrangement
relating to such Cereus Benefit Plan, (iii) the most recent annual report (Form
5500) filed with the Internal Revenue Service ("IRS") with respect to such
Cereus Benefit Plan, (iv) the most recent actuarial report or financial
statement relating to such Cereus Benefit Plan and (v) the most recent
determination letter issued by the IRS with respect to such Cereus Benefit Plan,
if it is qualified under Section 401(a) of the Code. Neither Cereus nor any
Subsidiary of Cereus has any express or implied commitment, whether legally
enforceable or not, (i) to create, incur liability with respect to or cause to
exist any other employee benefit plan, program or arrangement, (ii) to enter
into any contract or agreement to provide compensation or benefits to any
individual or (iii) to modify, change or terminate any Cereus Benefit Plan,
other than with respect to a modification, change or termination required by
ERISA or the Code.

(b) None of the Cereus Benefit Plans is a multiemployer plan (within the
meaning of Section 3(37) or 4001(a)(3) of ERISA) (a "MULTIEMPLOYER PLAN") or a
single employer pension plan (within the meaning of Section 4001(a)(15) of
ERISA) for which Cereus or any Subsidiary of Cereus could incur liability under
Section 4063 or 4064 of ERISA (a "MULTIPLE EMPLOYER PLAN"). None of the Cereus
Benefit Plans provides for or promises retiree medical, disability or life
insurance benefits to any current or former employee, officer or director of
Cereus or any Subsidiary of Cereus.

(c) Each Cereus Benefit Plan has been administered in all material respects
in accordance with its terms and all contributions required to be made under the
terms of any of the Cereus Benefit Plans as of the date of this Agreement have
been timely made or have been reflected on the most recent consolidated balance
sheet filed or incorporated by reference in the Cereus SEC Reports prior to the
date of this Agreement. Except as set forth in Schedule 3.6 (c), with respect to
the Cereus Benefit Plans, no event has occurred and, to the knowledge of Cereus,
there exists no condition or set of circumstances in connection with which
Cereus or any Subsidiary of Cereus could be subject to any liability under the
terms of such Cereus Benefit Plans, ERISA, the Code or any other applicable law
which would reasonably be expected to have, individually or in the aggregate, a
Cereus Material Adverse Effect. No legal action, suit or claim is pending or, to
the knowledge of Cereus, threatened with respect to any Cereus Benefit Plan
(other than claims for benefits in the ordinary course).

(d) Except as would not reasonably be expected to have, individually or in
the aggregate, a Cereus Material Adverse Effect: (i) each Cereus Benefit Plan
which is intended to be qualified under Section 401(a) of the Code or Section
401(k) of the Code has received a favorable determination letter from the IRS
that it is so qualified and each trust established in connection with any Cereus
Benefit Plan which is intended to be exempt from federal income taxation under
Section 501(a) of the Code has received a determination letter from the IRS that
it is so exempt, and no fact or event has occurred since the date of such
determination letter from the IRS to adversely affect the qualified status of
any such Cereus Benefit Plan or the exempt status of any such trust; (ii) each
trust maintained or contributed to by Cereus or any Subsidiary of Cereus which
is intended to be qualified as a voluntary employees' beneficiary association
and which is intended to be exempt from federal income taxation under Section
501(c)(9) of the Code has received a favorable determination letter from the IRS
that it is so qualified and so exempt, and no fact or event has occurred since
the date of such determination by the IRS to adversely affect such qualified or
exempt status; (iii) there has been no prohibited transaction (within the
meaning of Section 406 of ERISA or Section 4975 of the Code) with respect to any
Cereus Benefit Plan; (iv) neither Cereus nor any Subsidiary of Cereus has
incurred any liability for any penalty or tax arising under Section 4971, 4972,
4980, 4980B or 6652 of the Code or any liability under Section 502 of ERISA, and
no fact or event exists which could give rise to any such liability; (v) no
complete or partial termination has occurred within the five years preceding the
date hereof with respect to any Cereus Benefit Plan; (vi) no Cereus Benefit Plan
is subject to Title IV of ERISA; (vii) none of the assets of Cereus or any
Subsidiary of Cereus is the subject of any lien arising under Section 302(f) of
ERISA or Section 412(n) of the Code; neither Cereus nor any Subsidiary of Cereus
has been required to post any security under

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Section 307 of ERISA or Section 401(a)(29) of the Code; and no fact or event
exists which could give rise to any such lien or requirement to post any such
security; (viii) all contributions, premiums or payments required to be made
with respect to any Cereus Benefit Plan have been made on or before their due
dates; and (ix) all such contributions have been fully deducted for income tax
purposes and no such deduction has been challenged or disallowed by any
government entity and no fact or event exists which could give rise to any such
challenge or disallowance.

(e) Neither Cereus nor any Subsidiary of Cereus is a party to any
collective bargaining or other labor union contract applicable to persons
employed by Cereus or any Subsidiary of Cereus and no collective bargaining
agreement is being negotiated by Cereus or any Subsidiary of Cereus. As of the
date of this Agreement, there is no labor dispute, strike or work stoppage
against Cereus or any Subsidiary of Cereus pending or, to the knowledge of
Cereus, threatened which may interfere with the respective business activities
of Cereus or any Subsidiary of Cereus, except where such dispute, strike or work
stoppage would not reasonably be expected to have a Cereus Material Adverse
Effect. As of the date of this Agreement, to the knowledge of Cereus, there is
no charge or complaint against Cereus or any Subsidiary of Cereus pending before
the National Labor Relations Board or any comparable governmental entity pending
or threatened in writing, except where such unfair labor practice, charge or
complaint would not reasonably be expected to have a Cereus Material Adverse
Effect.

(f) Cereus has delivered or made available to Parent true, complete and
correct copies of (i) all employment agreements with officers and all consulting
agreements of Cereus and each Subsidiary of Cereus providing for annual
compensation in excess of $200,000, (ii) all severance plans, agreements,
programs and policies of Cereus and each Subsidiary of Cereus with or relating
to their respective employees or consultants, and (iii) all plans, programs,
agreements and other arrangements of Cereus and each Subsidiary of Cereus with
or relating to their respective employees or consultants which contain "change
of control" provisions.

(g) No employee of Cereus or its Subsidiaries will be entitled to any
additional benefits or any acceleration of the time of payment or vesting of any
benefits sunder any Cereus Benefit Plan as a result of the Transactions. No
amount payable, or economic benefit provided, by Cereus or its Subsidiaries
(including any acceleration of the time of payment or vesting of any benefit)
could be considered an "excess parachute payment" under Section 280G of the
Code. No person is entitled to receive any additional payment from Cereus or its
Subsidiaries or any other person in the event that the excise tax of Section
4999 of the Code is imposed on such person.

SECTION 3.7 Certain Tax Matters. Neither Cereus nor, to the knowledge of
Cereus, any of its affiliates has taken or agreed to take any action that would
reasonably be expected to prevent the Merger from constituting a transaction
qualifying under Section 368 of the Code. Cereus is not aware of any agreement,
plan or other circumstances that would reasonably be expected to prevent the
Merger from so qualifying under Section 368 of the Code.

SECTION 3.8 Contracts; Debt Instruments. There is no contract or agreement
that is material to the business, financial condition or results of operations
of Cereus and its Subsidiaries taken as a whole. Except as disclosed in Schedule
3.8, neither Cereus nor any Subsidiary of Cereus is in violation of or in
default under (nor does there exist any condition which with the passage of time
or the giving of notice would reasonably be expected to cause such a violation
of or default under) any loan or credit agreement, note, bond, mortgage,
indenture or lease, or any other contract, license, agreement, arrangement or
understanding to which it is a party or by which it or any of its properties or
assets is bound, except for violations or defaults that would not reasonably be
expected to have, individually or in the aggregate, a Cereus Material Adverse
Effect. Set forth in Section 3.8 of the Cereus Disclosure Schedule is a
description of any material changes to the amount and terms of the indebtedness
of Cereus and its subsidiaries as described in the notes to the financial
statements incorporated in Cereus's March 31, 2000 Form 10-QSB.

SECTION 3.9 Litigation. There is no suit, claim, action, proceeding or
investigation pending, to the knowledge of Cereus, or threatened against Cereus
or any Subsidiary of Cereus before any governmental
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entity that would reasonably be expected to have, individually or in the
aggregate, a Cereus Material Adverse Effect, and, except as disclosed to Parent,
to the knowledge of Cereus, there are no existing facts or circumstances that
would reasonably be expected to result in such a suit, claim, action, proceeding
or investigation. Except as disclosed to Parent, Cereus is not aware of any
facts or circumstances which would reasonably be expected to result in the
denial of insurance coverage under policies issued to Cereus and its
Subsidiaries in respect of such suits, claims, actions, proceedings and
investigations for which Cereus has a reasonable expectation of obtaining
insurance coverage, except in any case as would not reasonably be expected to
have, individually or in the aggregate, a Cereus Material Adverse Effect or as a
result of the execution of this Agreement and consummation of transactions
hereunder. Neither Cereus nor any Subsidiary of Cereus is subject to any
outstanding order, writ, injunction or decree which would reasonably be expected
to have, individually or in the aggregate, a Cereus Material Adverse Effect.

SECTION 3.10 Intellectual Property. Except as would not reasonably be
expected to have, individually or in the aggregate, a Cereus Material Adverse
Effect, (i) Cereus and its Subsidiaries own or possess adequate licenses or
other valid rights to use all patents, patent applications, patent rights,
trademarks, trademark rights, trade names, trade dress, trade name rights,
copyrights and copyright registrations and applications, copyright rights,
service marks, trade secrets, applications for trademarks and for service marks,
know-how and other proprietary rights and information used or held for use in
connection with the respective businesses of Cereus and its Subsidiaries as
currently conducted (collectively, the "CEREUS IP"), free and clear of all
liens, and (ii) Cereus is unaware of any assertion or claim challenging the
ownership, use or validity of any of the foregoing. The licenses associated with
the Cereus IP are valid and binding obligations of Cereus, enforceable in
accordance with their terms, and there are no material breaches or defaults
thereunder. The conduct of the respective businesses of Cereus and its
Subsidiaries as currently conducted does not infringe upon any patent, patent
right, license, trademark, trademark right, trade dress, trade name, trade name
right, service mark, copyright or copyright right of any third party that would
reasonably be expected to have, individually or in the aggregate, a Cereus
Material Adverse Effect. To the knowledge of Cereus, there are no infringements
of any proprietary rights owned by or licensed by or to Cereus or any Subsidiary
of Cereus that could reasonably be expected to have, individually or in the
aggregate, a Cereus Material Adverse Effect.

SECTION 3.11 Taxes. Except for such matters that would not reasonably be
expected to have, individually or in the aggregate, a Cereus Material Adverse
Effect, (i) Cereus and each of its Subsidiaries has timely filed or shall timely
file all returns and reports required to be filed by it with any taxing
authority, taking into account any extension of time to file granted to or
obtained on behalf of Cereus and its Subsidiaries, (ii) all taxes shown to be
payable on such returns or reports have been or will be paid, (iii) as of the
date hereof, no deficiencies for any amount of tax have been asserted or
assessed by any taxing authority against Cereus or any Subsidiary of Cereus that
are not adequately reserved for and (iv) the most recent financial statements
contained in the Cereus SEC Reports reflect an adequate reserve in accordance
with GAAP for all taxes payable by Cereus and its Subsidiaries for all taxable
periods and portions thereof accrued through the date of such financial
statements.

SECTION 3.12 Interested Party Transactions. Except for transactions of the
type described in the Cereus SEC Reports which have occurred since March 31,
2000 in the ordinary course of business, since March 31, 2000, no executive
officer, director or stockholder of Cereus or any of its Subsidiaries has
engaged in any business dealings with Cereus or any of its Subsidiaries (other
than any such business dealings that would not be required to be disclosed in a
proxy statement satisfying the requirements of Regulation 14A promulgated under
the Exchange Act filed on the date hereof).

SECTION 3.13 Absence of Certain Changes or Events. Since March 31, 2000,
except without the actual knowledge of Parent, after reasonable inquiry, there
has not been (i) any change that would result in a Cereus Material Adverse
Effect , (ii) any event or occurrence which, insofar as can be reasonably
foreseen, would in the future result in a Cereus Material Adverse Effect, or
(iii) any entry into a commitment or transaction material to Cereus and its
Subsidiaries taken as a whole (including any merger, acquisition, borrowing of
money or sales of assets), except in the ordinary course of business consistent
with past practice or undertaken with the knowledge of Parent.
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SECTION 3.14 Registration Statement and Proxy Statement. None of the
information to be supplied by Cereus or its Subsidiaries for inclusion in (i)
the Registration Statement on Form S-4 to be filed under the Securities Act with
the SEC in connection with the Merger for the purpose of registering the shares
of Parent Common Stock to be issued in the Merger (the "REGISTRATION STATEMENT")
or (ii) the proxy statement to be distributed in connection with Cereus's and
Parent's meetings of their respective stockholders to vote upon this Agreement
and the Transactions, and any amendments thereof or supplements thereto (the
"PROXY STATEMENT" and, together with the prospectus included in the Registration
Statement, the "JOINT PROXY STATEMENT/PROSPECTUS") will, in the case of the
Proxy Statement, at the time of the mailing of the Proxy Statement and at the
time of the meetings of stockholders of Parent and Cereus to be held in
connection with the Transactions, or, in the case of the Registration Statement,
as amended or supplemented, at the time it becomes effective and at the time of
such meetings of the stockholders of Parent and Cereus, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements, in the light of the
circumstances under which they are made, not misleading.

SECTION 3.15 Reorganization. None of Cereus or its Subsidiaries has
willfully taken or agreed to or intends to take any action or has any knowledge
of any fact or circumstance that would prevent the Merger from constituting a
reorganization within the meaning of Section 368(a) of the Code.

SECTION 3.16 Brokers and Finders. Cereus has not entered into any
contract, arrangement or understanding with any person or firm which may result
in the obligation of Cereus to pay any finder's fees, brokerage or agent
commissions or other like payments in connection with the Transactions, except
The Robinson-Humphrey Company, LLC ("ROBINSON-HUMPHREY"), whose fees and
expenses will be paid by Cereus in accordance with Cereus's agreement with
Robinson-Humphrey, based upon arrangements made by or on behalf of Cereus and
previously disclosed to Parent.

SECTION 3.17 Opinion of Financial Advisor. Robinson-Humphrey has rendered
an opinion to the Board of Directors of Cereus to the effect that, as of the
date hereof, the Exchange Ratio is fair to the holders of Cereus Common Stock
from a financial point of view; it being understood and acknowledged by Cereus
that such opinion has been rendered for the benefit of the Board of Directors of
Cereus and is not intended to, and may not, be relied upon by Parent, its
affiliates or their respective Subsidiaries. Robinson-Humphrey has authorized
the inclusion of its opinion in the Joint Proxy Statement/Prospectus.

SECTION 3.18 Hazardous Substances and Hazardous Waste.

(a) There is not now, nor has there ever been, any disposal, release or
threatened release of Hazardous Material (as defined below) on, from or under
properties now or ever owned or leased by or to Cereus or its Subsidiaries (the
"CEREUS PROPERTIES") and there has not been generated by or on behalf of Cereus
or its Subsidiaries any Hazardous Material that would result in a material
adverse effect to the business of Cereus or its Subsidiaries, taken as a whole.
No Hazardous Material has been disposed of or allowed to be disposed of by
Cereus or its Subsidiaries, by any other party, on or off any of the Cereus
Properties during the period that Cereus or its Subsidiaries owned or leased the
property which may give rise under applicable Environmental Law to a clean-up
responsibility, personal injury liability or property damage claim against
Cereus or its Subsidiaries or Cereus or its Subsidiaries being named a
potentially responsible party for any such clean-up costs, personal injuries or
property damage or create any cause of action by any third party against Cereus
or its Subsidiaries. For purposes of this subsection, the terms "disposal,"
"release," and "threatened release" shall have the definitions assigned thereto
by the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended. The term "Hazardous Material" means any material or substance
which is (i) defined as a "hazardous waste" or a "hazardous substance" under
applicable Law, (ii) designated as a "hazardous substance" pursuant to Section
311 of the Federal Water Pollution Control Act, (iii) defined as a "hazardous
waste" pursuant to Section 1004 of the Federal Resource Conservation and
Recovery Act, or (iv) defined as a "hazardous substance" pursuant to Section 101
of the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended. The term "Environmental Laws" means any law, statute,
ordinance,

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rule or regulation of any governmental authority for which the primary purpose
is to control pollution and protect the environment, including the statutes
referenced above in this paragraph.

(b) None of Cereus or its Subsidiaries' operations at the Cereus Properties
is (or, with respect to past Cereus Properties and Cereus Properties of former
Subsidiaries, was at the time of disposition) in violation of any Environmental
Law (with respect to past Cereus Properties and Cereus Properties of former
Subsidiaries, Environmental Laws in effect at the time of disposition) relating
to industrial hygiene or to the environmental conditions on, under or about such
Cereus Properties, including, without limitation, soil and ground water
condition and there are (or at the time of disposition were) no underground
tanks or related piping, conduits or related structures used by Cereus or its
Subsidiaries in the conduct of its business at such properties. During the
period that Cereus or its Subsidiaries owned or leased the Cereus Properties,
neither Cereus nor its Subsidiaries nor any third party used, generated,
manufactured or stored on, under or about such Cereus Properties or transported
to or from such Cereus Properties any Hazardous Material.

SECTION 3.19 Disclosure. The representations and warranties of Cereus in
this Agreement do not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements contained herein not
misleading.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT
AND CEREUS ACQUIRING SUB

Except as disclosed in the Parent SEC Reports (as defined in Section 4.5)
or as set forth in the Restated Parent Disclosure Schedule delivered by Parent
to Cereus prior to the execution of this Agreement (the "PARENT DISCLOSURE
SCHEDULE"), Parent and Cereus Acquiring Sub jointly and severally represent and
warrant to Cereus that the following statements are true and correct as of the
date hereof.

SECTION 4.1 Organization and Qualification. Each of Parent and Cereus
Acquiring Sub is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation and has the requisite
corporate power and authority to own, lease and operate its assets and
properties and to carry on its business as it is now being conducted. Each of
Parent and Cereus Acquiring Sub is qualified to do business and is in good
standing in each jurisdiction in which the properties owned, leased or operated
by it or the nature of the business conducted by it makes such qualification
necessary, except where the failure to be so qualified and in good standing will
not, when taken together with all other such failures, have, or be reasonably
expected to have, a material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results of operations of
Parent and its Subsidiaries, taken as a whole, other than any change,
circumstance or effect (i) relating to or resulting from the economy or
securities markets in general, (ii) relating to or resulting from the industries
in which Cereus or Parent operate and not uniquely relating to Cereus or Parent,
or (iii) resulting from the announcement or existence of the Original Agreement,
this Agreement or the Transactions (a "PARENT MATERIAL ADVERSE EFFECT"), and
copies of good standing certificates evidencing such qualification will be
delivered to Cereus at or prior to the Closing, in each case bearing a date
within thirty (30) days prior to the Closing Date.

SECTION 4.2 Capitalization.

(a) On June 12, 2000, the authorized capital stock of Parent consists of
50,000,000 shares of Parent Common Stock, $.01 par value per share, and
1,000,000 shares of preferred stock, par value $.01 per share ("PARENT PREFERRED
STOCK"). As of June 9, 2000, (i) 25,467,250 shares of Parent Common Stock were
issued and outstanding, all of which were validly issued and are fully paid,
nonassessable and free of preemptive rights, (ii) no shares of Parent Preferred
Stock were issued and outstanding, (iii) 6,700,103 shares of Parent Common Stock
were reserved for issuance pursuant to one or more plans of Parent governing the
issuance and administration of Parent Options (the "PARENT OPTION
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PLANS"), (iv) 540,000 shares of Parent Common Stock were reserved for issuance
upon exercise of outstanding warrants and options not issued under the Parent
Option Plans, and (v) no shares of Parent Common Stock were reserved for
issuance upon conversion of outstanding convertible debentures and outstanding
convertible notes.

(b) Except as set forth in subsection (a) above, Section 4.2 of the Parent
Disclosure Schedule, or as otherwise contemplated by this Agreement, there are
no outstanding subscriptions, options, calls, contracts, commitments,
restrictions, arrangements, rights or warrants, including any right of
conversion or exchange under any outstanding security, instrument or other
agreement and also including any rights plan or other anti-takeover agreement,
obligating Parent or any of its Subsidiaries to issue, deliver or sell, or cause
to be issued, delivered or sold, additional shares of the capital stock of
Parent or obligating Parent or any of its Subsidiaries to grant, extend or enter
into any such agreement or commitment. Except as otherwise disclosed in the
Parent SEC Reports, there are no voting trusts, proxies or other agreements or
understandings to which Parent or any of its Subsidiaries is a party or is bound
with respect to the voting of any shares of capital stock of Parent.

SECTION 4.3 Subsidiaries. Identified on Schedule 4.3 of the Parent
Disclosure Schedule is each direct and indirect Subsidiary of Parent. Each such
Subsidiary (i) is duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation and has the requisite corporate
power and authority to own, lease and operate its assets and properties and to
carry on its business as it is now being conducted; and (ii) is qualified to do
business, and is in good standing, in each jurisdiction in which the properties
owned, leased or operated by it or the nature of the business conducted by it
makes such qualification necessary, all such qualifications being listed in
Section 4.3 of the Parent Disclosure Schedule, except in all cases where the
failure to be so qualified and in good standing would not, when taken together
with all such other failures, result in a Parent Material Adverse Effect. At or
prior to Closing, copies of good standing certificates evidencing such
qualification will be delivered to Cereus in each case bearing a date within
thirty (30) days prior to the Closing Date. All of the outstanding shares of
capital stock or other equity interests of each Subsidiary of Parent are validly
issued, fully paid, nonassessable and free of preemptive rights, and are owned
directly or indirectly by Parent, free and clear of any liens, claims or
encumbrances, except that such shares are pledged to secure Parent's credit
facilities. There are no subscriptions, options, warrants, rights, calls,
contracts, voting trusts, proxies or other commitments, understandings,
restrictions or arrangements relating to the issuance, sale, voting, transfer,
ownership or other rights with respect to any shares of capital stock or other
equity interests of any corporate Subsidiary of Parent, including any right of
conversion or exchange under any outstanding security, instrument or agreement.

SECTION 4.4 Authority; Non-Contravention; Approvals.

(a) Each of Parent and Cereus Acquiring Sub has full corporate power and
authority to enter into this Agreement and, subject to the Parent Stockholders'
Approval (as defined in Section 6.3(b)) and the Parent Required Statutory
Approvals (as defined in Section 4.4(c)), to consummate the Transactions. This
Agreement has been approved by the Board of Directors of each of Parent and
Cereus Acquiring Sub and no other corporate proceeding on the part of Parent or
Cereus Acquiring Sub is necessary to authorize the execution and delivery of
this Agreement and, except for the Parent Stockholders' Approval, the
consummation by Parent and Cereus Acquiring Sub of the Transactions. This
Agreement has been duly executed and delivered by each of Parent and Cereus
Acquiring Sub and, assuming the due authorization, execution and delivery by the
other parties hereto, constitutes a valid and legally binding agreement of each
of Parent and Cereus Acquiring Sub, enforceable against each in accordance with
its terms.

(b) The execution and delivery of this Agreement by each of Parent and
Cereus Acquiring Sub do not violate, conflict with or result in a breach of any
provision of, or constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, or result in the termination
of, or accelerate the performance required by, or result in a right of
termination or acceleration under, or result in the creation of any lien,
security interest, charge or encumbrance upon any of the properties or assets of
Parent or any of its Subsidiaries under any of the terms, conditions or
provisions of (i) the

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respective charters or by-laws of Parent or any of its Subsidiaries, (ii) other
than as provided in Section 4.4(c), any statute, law, ordinance, rule,
regulation, judgment, decree, order, injunction, writ, permit or license of any
court or governmental authority applicable to Parent or any of its Subsidiaries
or any of their respective properties or assets or (iii) except as set forth in
Section 4.4(b) of the Parent Disclosure Schedule, any note, bond, mortgage,
indenture, deed of trust, license, franchise, permit, concession, contract,
lease or other instrument, obligation or agreement of any kind to which Parent
or any of its Subsidiaries is now a party or by which Parent or any of its
Subsidiaries or any of their respective properties or assets may be bound or
affected. The consummation by each of Parent and Cereus Acquiring Sub of the
Transactions will not result in any violation, conflict, breach, termination,
acceleration or creation of liens under the immediately preceding sentence,
subject (A) in the case of the terms, conditions or provisions described in
clause (ii) above, to obtaining (prior to the Effective Time) the Parent
Required Statutory Approvals and the Parent Stockholder's Approval and (B) in
the case of the terms, conditions or provisions described in clause (iii) above,
to obtaining (prior to the Effective Time) consents required from commercial
lenders, lessors or other third parties. Excluded from the foregoing sentences
of this paragraph (b), insofar as they apply to the terms, conditions or
provisions described in clauses (ii) and (iii) of the first sentence of this
paragraph (b) (and whether resulting from such execution and delivery or
consummation), are such violations, conflicts, breaches, defaults, terminations,
accelerations or creations of liens, security interests, charges or encumbrances
that would not, in the aggregate, result in a Parent Material Adverse Effect.

(c) Except for (i) the filing of the Registration Statement and Joint Proxy
Statement/Prospectus with the SEC pursuant to the Exchange Act and the
Securities Act, and the declaration of the effectiveness thereof by the SEC and
filings with various or approvals from state blue sky authorities, (ii) the
making of the Merger Filing, (iii) the filings by Parent required by the HSR Act
and (iv) any required filings with or approvals from the NASDAQ or NASD (the
filings and approvals referred to in clauses (i) through (iv) are collectively
referred to as the "PARENT REQUIRED STATUTORY APPROVALS"), no declaration,
filing or registration with, or notice to, or authorization, consent or approval
of, any governmental or regulatory body or authority is necessary for the
execution and delivery of this Agreement by Parent or the consummation by Parent
of the Transactions, other than such declarations, filings, registrations,
notices, authorizations, consents or approvals which, if not made or obtained,
as the case may be, would not, in the aggregate, result in a Parent Material
Adverse Effect.

SECTION 4.5 Reports and Financial Statements. Since January 1, 1997,
Parent has filed with the SEC all forms, statements, reports and documents
(including all exhibits, post-effective amendments and supplements thereto)
required to be filed by it under each of the Securities Act, the Exchange Act
and the respective rules and regulations thereunder, all of which, as amended if
applicable, complied when filed in all material respects with all applicable
requirements of the appropriate act and the rules and regulations thereunder. No
Subsidiary of Parent is required to file any form, report or other document with
the SEC. Parent has previously made available to Cereus, via its EDGAR filings
where available, copies (including all exhibits, post-effective amendments and
supplements thereto) of its (a) Annual Reports on Form 10-K (as amended on Form
10-K/A) for the fiscal years ended December 31, 1998 and December 31, 1999,
Annual Report on Form 10-KSB (as amended on Form 10-KSB/A) for the fiscal year
ended December 31, 1997, as filed with the SEC, (b) proxy and information
statements relating to (i) all meetings of its stockholders (whether annual or
special) and (ii) actions by written consent in lieu of a stockholders' meeting,
in each case from January 1, 1998 until the date hereof, and (c) all other
reports, including quarterly reports, and registration statements filed by
Parent with the SEC since January 1, 1997 (the documents referred to in clauses
(a), (b) and (c) are collectively referred to as the "PARENT SEC REPORTS"). As
of their respective dates, the Parent SEC Reports did not contain any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The audited financial
statements for the fiscal year ended December 1999 and the two prior fiscal
years, and the unaudited consolidated financial statements of Parent included in
Parent's Quarterly Report on Form 10-Q for the period ended March 31, 2000
(collectively, the "PARENT FINANCIAL STATEMENTS"), have been prepared in
accordance with GAAP (except as may be indicated therein or in the
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notes thereto) and fairly present the financial position of Parent and its
Subsidiaries as of the dates thereof and the results of their operations and
changes in financial position for the periods then ended.

SECTION 4.6 Employee Benefit Plans; Labor Matters; No Parachute Payments.

(a) Section 4.6(a) of the Parent Disclosure Schedule lists all employee
benefit plans (as defined in Section 3(3) of ERISA) and all bonus, stock option,
stock purchase, restricted stock, incentive, deferred compensation, retiree
medical or life insurance, supplemental retirement, severance or other benefit
plans, programs or arrangements, whether legally enforceable or not, to which
Parent or any Subsidiary of Parent is a party, with respect to which Parent or
any Subsidiary of Parent has any obligation or which are maintained, contributed
to or sponsored by Parent or any Subsidiary of Parent for the benefit of any
current or former employee, officer or director of Parent or any Subsidiary of
Parent (collectively, the "PARENT BENEFIT PLANS"). With respect to each Parent
Benefit Plan, Parent has delivered, or prior to Closing will deliver, or make
available to Parent a true, complete and correct copy of (i) such Parent Benefit
Plan and the most recent summary plan description related to such Parent Benefit
Plan, if a summary plan description is required therefor, (ii) each trust
agreement or other funding arrangement relating to such Parent Benefit Plan,
(iii) the most recent annual report (Form 5500) filed with the IRS) with respect
to such Parent Benefit Plan, (iv) the most recent actuarial report or financial
statement relating to such Parent Benefit Plan and (v) the most recent
determination letter issued by the IRS with respect to such Parent Benefit Plan,
if it is qualified under Section 401(a) of the Code. Neither Parent nor any
Subsidiary of Parent has any express or implied commitment, whether legally
enforceable or not, (i) to create, incur liability with respect to or cause to
exist any other employee benefit plan, program or arrangement, (ii) to enter
into any contract or agreement to provide compensation or benefits to any
individual or (iii) to modify, change or terminate any Parent Benefit Plan,
other than with respect to a modification, change or termination required by
ERISA or the Code.

(b) None of the Parent Benefit Plans is a Multiemployer Plan or a Multiple
Employer Plan. None of the Parent Benefit Plans provides for or promises retiree
medical, disability or life insurance benefits to any current or former
employee, officer or director of Parent or any Subsidiary of Parent.

(c) Each Parent Benefit Plan has been administered in all material respects
in accordance with its terms and all contributions required to be made under the
terms of any of the Parent Benefit Plans as of the date of this Agreement have
been timely made or have been reflected on the most recent consolidated balance
sheet filed or incorporated by reference in Parent Reports prior to the date of
this Agreement. Except as set forth in Schedule 4.6(c), with respect to the
Parent Benefit Plans, no event has occurred and, to the knowledge of Parent,
there exists no condition or set of circumstances in connection with which
Parent or any Subsidiary of Parent could be subject to any liability under the
terms of such Parent Benefit Plans, ERISA, the Code or any other applicable law
which would reasonably be expected to have, individually or in the aggregate, a
Parent Material Adverse Effect. No legal action, suit or claim is pending or, to
the knowledge of Parent, threatened with respect to any Parent Benefit Plan
(other than claims for benefits in the ordinary course).

(d) Except as would not reasonably be expected to have, individually or in
the aggregate, a Parent Material Adverse Effect: (i) each Parent Benefit Plan
which is intended to be qualified under Section 401(a) of the Code or Section
401(k) of the Code has received a favorable determination letter from the IRS
that it is so qualified and each trust established in connection with any Parent
Benefit Plan which is intended to be exempt from federal income taxation under
Section 501(a) of the Code has received a determination letter from the IRS that
it is so exempt, and no fact or event has occurred since the date of such
determination letter from the IRS to adversely affect the qualified status of
any such Parent Benefit Plan or the exempt status of any such trust; (ii) each
trust maintained or contributed to by Parent or any Subsidiary of Parent which
is intended to be qualified as a voluntary employees' beneficiary association
and which is intended to be exempt from federal income taxation under Section
501(c)(9) of the Code has received a favorable determination letter from the IRS
that it is so qualified and so exempt, and no fact or event has occurred since
the date of such determination by the IRS to adversely affect such qualified or
exempt status; (iii) there has been no prohibited transaction (within the
meaning of

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Section 406 of ERISA or Section 4975 of the Code) with respect to any Parent
Benefit Plan; (iv) neither Parent nor any Subsidiary of Parent has incurred any
liability for any penalty or tax arising under Section 4971, 4972, 4980, 4980B
or 6652 of the Code or any liability under Section 502 of ERISA, and no fact or
event exists which could give rise to any such liability; (v) no complete or
partial termination has occurred within the five years preceding the date hereof
with respect to any Parent Benefit Plan; (vi) no Parent Benefit Plan is subject
to Title IV of ERISA; (vii) none of the assets of Parent or any Subsidiary of
Parent is the subject of any lien arising under Section 302(f) of ERISA or
Section 412(n) of the Code; neither Parent nor any Subsidiary of Parent has been
required to post any security under Section 307 of ERISA or Section 401(a)(29)
of the Code; and no fact or event exists which could give rise to any such lien
or requirement to post any such security; (viii) all contributions, premiums or
payments required to be made with respect to any Parent Benefit Plan have been
made on or before their due dates; and (ix) all such contributions have been
fully deducted for income tax purposes and no such deduction has been challenged
or disallowed by any government entity and no fact or event exists which could
give rise to any such challenge or disallowance.

(e) Neither Parent nor any Subsidiary of Parent is a party to any
collective bargaining or other labor union contract applicable to persons
employed by Parent or any Subsidiary of Parent and no collective bargaining
agreement is being negotiated by Parent or any Subsidiary of Parent. As of the
date of this Agreement, there is no labor dispute, strike or work stoppage
against Parent or any Subsidiary of Parent pending or, to the knowledge of
Parent, threatened which may interfere with the respective business activities
of Parent or any Subsidiary of Parent, except where such dispute, strike or work
stoppage would not reasonably be expected to have a Parent Material Adverse
Effect. As of the date of this Agreement, to the knowledge of Parent, there is
no charge or complaint against Parent or any Subsidiary of Parent pending before
the National Labor Relations Board or any comparable governmental entity pending
or threatened in writing, except where such unfair labor practice, charge or
complaint would not reasonably be expected to have a Parent Material Adverse
Effect.

(f) Parent has delivered or made available to Parent true, complete and
correct copies of (i) all employment agreements with officers and all consulting
agreements of Parent and each Subsidiary of Parent providing for annual
compensation in excess of $200,000, (ii) all severance plans, agreements,
programs and policies of Parent and each Subsidiary of Parent with or relating
to their respective employees or consultants, and (iii) all plans, programs,
agreements and other arrangements of Parent and each Subsidiary of Parent with
or relating to their respective employees or consultants which contain "change
of control" provisions.

(g) No employee of Parent or its Subsidiaries will be entitled to any
additional benefits or an acceleration of the time of payment or vesting of any
benefits under any of Parent Benefit Plan as a result of the Transactions. No
amount payable, or economic benefit provided, by Parent or its Subsidiaries
(including any acceleration of the time of payment or vesting of any benefit)
could be considered an "excess parachute payment" under Section 280G of the
Code. No person is entitled to receive any additional payment from Parent or its
Subsidiaries or any other person in the event that the excise tax of Section
4999 of the Code is imposed on such person.

SECTION 4.7 Certain Tax Matters. Neither Parent nor, to the knowledge of
Parent, any of its affiliates has taken or agreed to take any action that would
reasonably be expected to prevent the Merger from constituting a transaction
qualifying under Section 368 of the Code. Parent is not aware of any agreement,
plan or other circumstances that would reasonably be expected to prevent the
Merger from so qualifying under Section 368 of the Code.

SECTION 4.8 Contracts; Debt Instruments. There is no contract or agreement
that is material to the business, financial condition or results of operations
of Parent and its Subsidiaries taken as a whole. Except as disclosed in Schedule
4.8, neither Parent nor any Subsidiary of Parent is in violation of or in
default under (nor does there exist any condition which with the passage of time
or the giving of notice would reasonably be expected to cause such a violation
of or default under) any loan or credit agreement, note, bond, mortgage,
indenture or lease, or any other contract, license, agreement, arrangement or

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understanding to which it is a party or by which it or any of its properties or
assets is bound, except for violations or defaults that would not reasonably be
expected to have, individually or in the aggregate, a Parent Material Adverse
Effect. Set forth in Schedule 4.8 is a description of any material changes to
the amount and terms of the indebtedness of Parent and its subsidiaries as
described in the notes to the financial statements incorporated in Parent's
March 31, 2000 Form 10-Q.

SECTION 4.9 Litigation. There is no suit, claim, action, proceeding or
investigation pending or, to the knowledge of Parent, threatened against Parent
or any Subsidiary of Parent before any governmental entity that would reasonably
be expected to have, individually or in the aggregate, a Parent Material Adverse
Effect, and, except as disclosed to Parent, to the knowledge of Parent, there
are no existing facts or circumstances that would reasonably be expected to
result in such a suit, claim, action, proceeding or investigation. Except as
disclosed to Parent, Parent is not aware of any facts or circumstances which
would reasonably be expected to result in the denial of insurance coverage under
policies issued to Parent and its Subsidiaries in respect of such suits, claims,
actions, proceedings and investigations for which Parent has a reasonable
expectation of obtaining insurance coverage, except in any case as would not
reasonably be expected to have, individually or in the aggregate, a Parent
Material Adverse Effect or as a result of the execution of this Agreement and
consummation of transactions hereunder. Except as disclosed in Schedule 4.9,
neither Parent nor any Subsidiary of Parent is subject to any outstanding order,
writ, injunction or decree which would reasonably be expected to have,
individually or in the aggregate, a Parent Material Adverse Effect.

SECTION 4.10 Intellectual Property. Except as would not reasonably be
expected to have, individually or in the aggregate, a Parent Material Adverse
Effect, (i) Parent and its Subsidiaries own or possess adequate licenses or
other valid rights to use all patents, patent applications, patent rights,
trademarks, trademark rights, trade names, trade dress, trade name rights,
copyrights and copyright registrations and applications, copyright rights,
service marks, trade secrets, applications for trademarks and for service marks,
know-how and other proprietary rights and information used or held for use in
connection with the respective businesses of Parent and its Subsidiaries as
currently conducted (collectively, the "PARENT IP"), free and clear of all liens
other than those in favor of PNC Bank, National Association ("PNC"), and (ii)
Parent is unaware of any assertion or claim challenging the ownership, use or
validity of any of the foregoing. The licenses associated with the Parent IP are
valid and binding obligations of Parent, enforceable in accordance with their
terms, and there are no material breaches or defaults thereunder. The conduct of
the respective businesses of Parent and its Subsidiaries as currently conducted
does not infringe upon any patent, patent right, license, trademark, trademark
right, trade dress, trade name, trade name right, service mark, copyright or
copyright right of any third party that would reasonably be expected to have,
individually or in the aggregate, a Parent Material Adverse Effect. To the
knowledge of Parent, there are no infringements of any proprietary rights owned
by or licensed by or to Parent or any Subsidiary of Parent that could reasonably
be expected to have, individually or in the aggregate, a Parent Material Adverse
Effect.

SECTION 4.11 Taxes. Except for such matters that would not reasonably be
expected to have, individually or in the aggregate, a Parent Material Adverse
Effect, (i) Parent and each of its Subsidiaries has timely filed or shall timely
file all returns and reports required to be filed by it with any taxing
authority, taking into account any extension of time to file granted to or
obtained on behalf of Parent and its Subsidiaries, (ii) all taxes shown to be
payable on such returns or reports have been or will be paid, (iii) as of the
date hereof, no deficiencies for any amount of tax have been asserted or
assessed by any taxing authority against Parent or any Subsidiary of Parent that
are not adequately reserved for and (iv) the most recent financial statements
contained in the Parent SEC Reports reflect an adequate reserve in accordance
with GAAP for all taxes payable by Parent and its Subsidiaries for all taxable
periods and portions thereof accrued through the date of such financial
statements.

SECTION 4.12 Interested Party Transactions. Except for transactions of the
type described in the Parent SEC Reports which have occurred since March 31,
2000 in the ordinary course of business, since March 31, 2000, no executive
officer, director or stockholder of Parent or any of its Subsidiaries has
engaged in any business dealings with Parent or any of its Subsidiaries (other
than any such business
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dealings that would not required to be disclosed in a proxy statement satisfying
the requirements of Regulation 14A promulgated under the Exchange Act filed on
the date hereof).

SECTION 4.13 Absence of Certain Changes or Events. Since March 31, 2000,
except with respect to the proposed sale of the Hospitality Services Group, or
without the actual knowledge, after reasonable inquiry, of the persons
identified in Section 6.15, there has not been (i) any change that would result
in a Parent Material Adverse Effect, (ii) any event or occurrence which, insofar
as can be reasonably foreseen, would in the future result in a Parent Material
Adverse Effect, or (iii) any entry into a commitment or transaction material to
Parent and its Subsidiaries taken as a whole (including any merger, acquisition,
borrowing of money or sales of assets), except in the ordinary course of
business consistent with past practice.

SECTION 4.14 Registration Statement and Proxy Statement. None of the
information to be supplied by Parent or its Subsidiaries for inclusion in (i)
the Registration Statement or (ii) Joint Proxy Statement/ Prospectus will, in
the case of the Proxy Statement, at the time of the mailing of the Proxy
Statement, and at the time of the meetings of stockholders of Parent and Cereus
to be held in connection with the Transactions, or, in the case of the
Registration Statement, as amended or supplemented, at the time it becomes
effective and at the time of such meetings of the stockholders of Cereus and
Parent, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they are made,
not misleading. The Joint Proxy Statement/Prospectus will, as of its mailing
date, comply as to form in all material respects with all applicable laws,
including the provisions of the Securities Act and the Exchange Act and the
rules and regulations promulgated thereunder, except that no representation is
made by Parent with respect to information supplied by Cereus or the
stockholders of Cereus for inclusion in the Joint Proxy Statement/Prospectus.

SECTION 4.15 Reorganization. None of Parent or its Subsidiaries has taken
or agreed or intends to take any action or has any knowledge of any fact or
circumstance that would prevent the Merger from constituting a reorganization
within the meaning of Section 368(a) of the Code.

SECTION 4.16 Brokers and Finders. Parent has not entered into any
contract, arrangement or understanding with any person or firm which may result
in the obligation of Parent to pay any finder's fees, brokerage or agent
commissions or other like payments in connection with the Transactions, except
Morgan Keegan & Company, Inc. ("MORGAN KEEGAN"), whose fees and expenses will be
paid by Parent in accordance with Parent's agreement with Morgan Keegan, based
upon arrangements made by or on behalf of Parent and previously disclosed to
Cereus.

SECTION 4.17 Opinion of Financial Advisor. Morgan Keegan has rendered an
opinion to the Board of Directors of Parent to the effect that, as of the date
hereof, the Exchange Ratio is fair to the holders of Parent Common Stock from a
financial point of view; it being understood and acknowledged by Parent that
such opinion has been rendered for the benefit of the Board of Directors of
Parent and is not intended to, and may not, be relied upon by Cereus, its
affiliates or their respective Subsidiaries. Morgan Keegan has authorized the
inclusion of its opinion in the Joint Proxy Statement/Prospectus.

SECTION 4.18 Hazardous Substances and Hazardous Waste.

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any cause of action by any third party against Parent or its Subsidiaries. For
purposes of this subsection, the terms "disposal," "release," and "threatened
release" shall have the definitions assigned thereto by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended. The
term "Hazardous Material" means any material or substance which is (i) defined
as a "hazardous waste" or a "hazardous substance" under applicable Law, (ii)
designated as a "hazardous substance" pursuant to Section 311 of the Federal
Water Pollution Control Act, (iii) defined as a "hazardous waste" pursuant to
Section 1004 of the Federal Resource Conservation and Recovery Act, or (iv)
defined as a "hazardous substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended. The
term "Environmental Laws" means any law, statute, ordinance, rule or regulation
of any governmental authority for which the primary purpose is to control
pollution and protect the environment, including the statutes referenced above
in this paragraph.

(b) None of Parent or its Subsidiaries' operations at the Parent Properties
is (or, with respect to past Parent Properties and Parent Properties of former
Subsidiaries, was at the time of disposition) in violation of any Environmental
Law (with respect to past Parent Properties and Parent Properties of former
Subsidiaries, Environmental Laws in effect at the time of disposition) relating
to industrial hygiene or to the environmental conditions on, under or about such
Parent Properties, including without limitation soil and ground water condition
and there are (or at the time of disposition were) no underground tanks or
related piping, conduits or related structures used by Parent or its
Subsidiaries in the conduct of its business at such properties. During the
period that Parent or its Subsidiaries owned or leased the Parent Properties,
neither Parent nor its Subsidiaries nor any third party used, generated,
manufactured or stored on, under or about such Parent Properties or transported
to or from such Parent Properties any Hazardous Material.

SECTION 4.19 Disclosure. To the knowledge of Parent and Cereus Acquiring
Sub, the representations and warranties of Parent and Cereus Acquiring Sub in
this Agreement do not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements contained herein not
misleading.

ARTICLE V

CONDUCT OF BUSINESS PENDING THE MERGER

SECTION 5.1 Transition Matters.

(a) Upon the execution and delivery of the Original Agreement, Cereus and
Parent established a committee (the "STEERING COMMITTEE") for the purpose of, to
the extent permitted by applicable laws, facilitating the full exchange of
information concerning the business, operations, capital spending, budgets, and
financial results of Parent and Cereus between such date and the Closing Date
(the "INTERIM PERIOD") and otherwise facilitating the efficient transition and
combination of the respective businesses of Parent and Cereus as promptly as
practicable following the Closing. The Steering Committee presently and at all
times shall consist of two individuals to be designated from time to time by the
Chairman of the Board of Directors of Parent and two individuals to be
designated from time to time by the Chairman of the Board of Directors of Cereus
and will be chaired by Cereus; provided, however, that on or before September 1,
2000, the Board of Directors of Parent shall take all actions necessary to cause
Steven A. Odom to be elected Chief Executive Officer of Parent, James M. Logsdon
to be elected President and Chief Operating Offer of Parent and Juliet M.
Reising to be elected Chief Financial Officer and Executive Vice President of
Parent, and upon the effectiveness of such elections the Steering Committee
shall be dissolved for so long as they serve in such capacities. All material
decisions of the Steering Committee, which shall be dissolved as of the Closing,
shall be mutually agreed upon by Parent and Cereus.

(b) If this Agreement shall be terminated pursuant to Section 8.1 and, at
the time of such termination, Cereus shall be entitled to receive a termination
fee under Section 8.5, then Parent shall reimburse Cereus for the costs incurred
by Cereus in connection with making its personnel available to

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Parent during the Interim Period in fulfillment of the purposes of this Section
5.1 in an amount equal to $12,500 per week or any part thereof. Reimbursement by
Parent to Cereus under this Section 5.1(b) shall be made simultaneous with the
payment of any such termination fee.

(c) Parent shall indemnify and hold harmless Cereus and those employees of
Cereus who render services to Parent during the Interim Period under this
Agreement (including those employees who serve on the Steering Committee or who
are elected to be officers of Parent) from and against any claims or liabilities
asserted against them relating to their services to Parent hereunder (and Parent
hereby forever releases Cereus and such persons from any claims by or
liabilities to Parent arising from or relating to such services), provided that
(i) such claims or liabilities did not result from acts or omissions (x) not in
good faith or (y) which involve intentional misconduct or a knowing violation of
law and (ii) such services were rendered in a manner reasonably and in good
faith believed to be in or not opposed to the best interests of Parent.

(d) During the Interim Period, Cereus shall cause all of its employees made
available to Parent pursuant to this Agreement to use their best efforts to (i)
avoid doing anything to the competitive disadvantage of Parent vis-a-vis Cereus,
(ii) not use to the advantage of Cereus any confidential information of Parent
obtained while performing services for or on behalf of Parent, (iii) not solicit
any employees of Parent to terminate their relationship with Parent, and (iv) if
requested by Parent to do so, cause each such employee of Cereus to execute
confidentiality and non-solicitation agreements in customary form in accordance
with the foregoing.

SECTION 5.2 Conduct of Business By Parent and Cereus Pending the
Merger. Subject to Section 5.1 above, or except as otherwise contemplated by
this Agreement, after the date hereof and prior to the Closing Date or earlier
termination of this Agreement, each of the Companies shall, and shall cause each
of their Subsidiaries to:

(a) conduct their respective businesses in the ordinary and usual course of
business and consistent with the immediate past practice;

(b) not (i) amend or propose to amend their respective Articles of
Incorporation or Bylaws (or comparable organizational documents), (ii) split,
combine or reclassify their outstanding capital stock, (iii) declare, set aside
or pay any dividend or distribution payable in cash, stock, property or
otherwise, except for the payment of dividends or distributions to a Company by
a wholly-owned Subsidiary of such Company, or (iv) repurchase any shares of
their outstanding capital stock;

(c) not issue, sell, pledge or dispose of, or agree to issue, sell, pledge
or dispose of, any additional shares of, or any options, warrants or rights of
any kind to acquire any shares of, their capital stock of any class or any debt
or equity securities convertible into or exchangeable for such capital stock,
except that (i) each Company may (A) grant options to non-executive employees
and (B) issue shares upon the exercise of outstanding options and warrants or
pursuant to existing agreements, and (ii) Cereus may issue, agree to issue and
sell shares of Cereus Common Stock and warrants to acquire shares of Cereus
Common Stock, provided that the aggregate consideration therefor does not exceed
$15 million, and provided further that Cereus shall give to the Chairman of the
Board of Parent reasonable prior notice of such transaction or transactions;

(d) not (i) assume, incur or become contingently liable with respect to any
indebtedness for borrowed money other than (A) borrowings in the ordinary course
of business (other than pursuant to credit facilities) or borrowings under the
existing credit facilities of each Company (the "EXISTING CREDIT FACILITIES") up
to the existing borrowing limit on the date hereof or (B) borrowings to
refinance existing indebtedness on terms which are reasonably acceptable to the
other Company, (ii) redeem, purchase, acquire or offer to purchase or acquire
any shares of its capital stock or any options, warrants or rights to acquire
any of its capital stock or any security convertible into or exchangeable for
its capital stock other than pursuant to an employee stock incentive plan of a
Company, (iii) take or fail to take any action which action or failure to take
action would cause either Company or their stockholders (except to the extent
that any stockholders receive cash in lieu of fractional shares) to recognize
gain or

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loss for federal income tax purposes as a result of the consummation of the
Merger or would otherwise cause the Merger not to qualify as a reorganization
under Section 368(a) of the Code, (iv) make any acquisition of any assets or
businesses other than expenditures for current assets in the ordinary course of
business and expenditures for fixed or capital assets in the ordinary course of
business and (v) sell, pledge, dispose of or encumber any material assets or
businesses, or enter into any binding contract, agreement, commitment or
arrangement with respect to any of the foregoing;

(e) use all reasonable efforts to preserve intact their respective business
organizations and goodwill, keep available the services of their respective
present officers and key employees, and preserve the goodwill and business
relationships with customers and others having business relationships with them
and not engage in any action, directly or indirectly, with the intent to
adversely impact the Transactions;

(f) not enter into or amend any employment, severance, special pay
arrangement with respect to termination of employment or other similar
arrangements or agreements with any directors, officers or key employees, except
in the ordinary course and consistent with past practice;

(g) not adopt, enter into or amend any pension or retirement plan, trust or
fund, except as required to comply with changes in applicable law and not adopt,
enter into or amend in any material respect any bonus, profit sharing,
compensation, stock option, deferred compensation, health care, employment or
other employee benefit plan, agreement, trust, fund or arrangement for the
benefit or welfare of any employees or retirees generally, other than in the
ordinary course of business;

(h) use commercially reasonable efforts to maintain with financially
responsible insurance companies insurance on its tangible assets and its
businesses in such amounts and against such risks and losses as are consistent
with past practice; and

(i) not make, change or revoke any material tax election or make any
material agreement or settlement regarding taxes with any taxing authority.

SECTION 5.3 Acquisition Transactions.

(a) Each Company shall not, directly or indirectly, and shall instruct its
officers, directors, employees, Subsidiaries, agents or advisors or other
representatives (including any investment banker, attorney or accountant
retained by it), not to, directly or indirectly, solicit, initiate or knowingly
encourage (including by way of furnishing nonpublic information), or take any
other action knowingly to facilitate, any inquiries or the making of any
proposal or offer (including any proposal or offer to its stockholders) that
constitutes, or may reasonably be expected to lead to, any Competing Transaction
(as defined in Section 5.3(b)), or enter into or maintain or continue
discussions or negotiate with any person in furtherance of such inquiries, or
agree to or endorse any Competing Transaction, or authorize or permit any of the
officers, directors or employees of the Company or any Subsidiary, or any
investment banker, financial advisor, attorney, accountant or other
representative retained by the Company or any Subsidiary, to take any such
action; provided, however, that (i) nothing contained in this Section 5.3(a)
shall prohibit the Board of Directors of the Company from complying with Rule
14e-2 promulgated under the Exchange Act with regard to a tender or exchange
offer not made in violation of this Section 5.3(a), and (ii) if, after receiving
the written opinion of outside legal counsel, the Board of Directors of the
Company determines in good faith that failing to do so would violate its
fiduciary duties, nothing contained in this Section 5.3(a) shall prohibit the
Board of Directors of the Company from considering and negotiating (including
furnishing nonpublic information) an unsolicited bona fide written acquisition
proposal (the "UNSOLICITED BID") and from approving or recommending to the
stockholders of the Company such Unsolicited Bid which (A) was not received in
violation of this Section 5.3(a), (B) if executed or consummated would be a
Competing Transaction, (C) is not subject to financing or financing is, in the
good faith judgment of the Board of Directors of the Company after consultation
with its financial advisors, highly likely of being obtained, and (D) the Board
of Directors of the Company determines in good faith, after receiving the
written opinion of its financial advisor to such effect, that such Unsolicited
Bid is highly likely to result in a transaction more favorable, from a financial
point of view, to the Company's stockholders than the Merger. Each Company shall
use its best efforts to notify the other Company promptly, and in no event

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later than one day after receipt, if any proposal or offer, or any inquiry or
contact with any person with respect thereto, regarding a Competing Transaction
is made. The Company immediately shall cease and cause to be terminated all
existing discussions or negotiations with any parties conducted heretofore with
respect to a Competing Transaction. Subject to the fiduciary duties of the Board
of Directors of the Company, the Company shall not release any third party from,
or waive any provision of, any confidentiality or standstill agreement to which
it is a party. The Company shall use its best efforts to ensure that its
officers, directors, employees, subsidiaries, agents and advisors or other
representatives (including any investment banker, attorney or accountant
retained by it) are aware of the restrictions described in this Section 5.3.

(b) For purposes of this Section 5.3, the term "COMPETING TRANSACTION"
shall mean any of the following involving either Company or any Subsidiary of
either Company whose business constitutes 25% or more of the net revenues, net
income or assets of such Company and its Subsidiaries, taken as a whole, as the
case may be (other than the Merger contemplated by this Agreement or the sale of
the Hospitality Assets):

(i) any merger, consolidation, share exchange, business combination or
other similar transaction;

(ii) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition of 15% or more of the assets of such party and its
Subsidiaries, taken as a whole, in a single transaction or series of
related transactions except for the sale of inventory in the ordinary
course of business; or

(iii) any tender offer or exchange offer for 15% or more of the
outstanding voting securities of such party or the filing of a registration
statement under the Securities Act in connection therewith.

ARTICLE VI
ADDITIONAL AGREEMENTS

SECTION 6.1 Access to Information.

(a) Subject to applicable law, Cereus and its Subsidiaries shall afford to
Parent and its respective accountants, counsel, financial advisors and other
representatives (the "PARENT REPRESENTATIVES") and Parent and its Subsidiaries
shall afford to Cereus and its accountants, counsel, financial advisors and
other representatives (the "CEREUS REPRESENTATIVES") full access during normal
business hours with reasonable notice throughout the period prior to the
Effective Time to all of their respective properties, books, contracts,
commitments and records (including, but not limited to, tax returns) and, during
such period, shall furnish promptly to one another (i) a copy of each report,
schedule and other document filed or received by any of them pursuant to the
requirements of federal or state securities laws or filed by any of them with
the SEC in connection with the Transactions and (ii) such other information
concerning their respective businesses, properties and personnel as either
Company shall reasonably request; provided, however, that no investigation
pursuant to this Section 6.1 shall amend or modify any representations or
warranties made herein or the conditions to the obligations of the respective
parties to consummate the Merger. Cereus and its Subsidiaries shall hold and
shall use their reasonable best efforts to cause the Cereus Representatives to
hold, and Parent and its Subsidiaries shall hold and shall use their reasonable
best efforts to cause Parent Representatives to hold, in strict confidence all
nonpublic documents and information furnished to each Company, in connection
with the Transactions contemplated by this Agreement, except that (i) Cereus and
Parent may disclose such information as may be necessary in connection with
seeking the Cereus Required Statutory Approvals, Cereus Stockholders' Approval,
Parent Required Statutory Approvals and Parent Stockholders' Approval and (ii)
each of Cereus and Parent may disclose any information that it is required by
law or judicial or administrative order to disclose.

(b) In the event that this Agreement is terminated in accordance with its
terms, each Company shall promptly redeliver to the other all nonpublic written
material provided pursuant to this Section 6.1 and shall not retain any copies,
extracts or other reproductions in whole or in part of such written material. In

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such event, all documents, memoranda, notes and other writings prepared by a
Company based on the information in such material shall be destroyed (and each
Company shall use their respective reasonable best efforts to cause their
advisors and representatives to similarly destroy their documents, memoranda and
notes), and such destruction (and reasonable best efforts) shall be certified in
writing by an authorized officer supervising such destruction.

SECTION 6.2 Registration Statement and Proxy Statement. Parent shall file
with the SEC as soon as is reasonably practicable after the date hereof the
Registration Statement and shall use all reasonable efforts to have the
Registration Statement declared effective by the SEC as promptly as practicable.
Parent shall also take any action required to be taken under applicable state
blue sky or securities laws in connection with the issuance of Parent Common
Stock pursuant to this Agreement and shall use all reasonable efforts to obtain
required approvals and clearance with respect thereto. Parent, Cereus Acquiring
Sub and Cereus shall promptly furnish to each other all information, and take
such other actions, as may reasonably be requested in connection with any action
by any of them in connection with the foregoing sentence. The information
provided and to be provided by Parent and Cereus, respectively, for use in the
Joint Proxy Statement/Prospectus 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 the light of the circumstances
under which they were made, not misleading.

SECTION 6.3 Stockholders' Approvals.

(a) Subject to the fiduciary duties of the Board of Directors of Cereus
under applicable law, Cereus shall, as promptly as practicable, submit this
Agreement and the Transactions for the approval of its stockholders at a meeting
of stockholders and shall use its best efforts to obtain stockholder approval
and adoption (the "CEREUS STOCKHOLDERS' APPROVAL") of this Agreement and the
Transactions. Subject to the fiduciary duties of the Board of Directors of
Cereus under applicable law, such meeting of stockholders shall be held as soon
as practicable following the date upon which the Registration Statement becomes
effective. Subject to the fiduciary duties of the Board of Directors of Cereus
under applicable law, Cereus shall, through its Board of Directors, recommend to
its stockholders approval of the Transactions.

(b) Subject to the fiduciary duties of the Board of Directors of Parent
under applicable law, Parent shall, as promptly as practicable, submit this
Agreement and the Transactions for the approval of its shareholders at a meeting
of shareholders and shall use its best efforts to obtain stockholder approval
and adoption (the "PARENT STOCKHOLDERS' APPROVAL") of this Agreement and the
Transactions. Subject to the fiduciary duties of the Board of Directors of
Parent under applicable law, such meeting of stockholders shall be held as soon
as practicable following the date upon which the Registration Statement becomes
effective. Subject to the fiduciary duties of the Board of Directors of Parent
under applicable law, Parent shall, through its Board of Directors, recommend to
its stockholders approval of the Transactions.

SECTION 6.4 Compliance With The Securities Act. Cereus shall use its best
efforts to cause each officer, each director and each other person who is an
"affiliate," of Cereus, as that term is used in paragraphs (c) and (d) of Rule
145 under the Securities Act ("RULE 145"), to deliver to Parent, at or prior to
the Effective Time a written agreement (an "AFFILIATE AGREEMENT") to the effect
that such person will not offer to sell, sell or otherwise dispose of any shares
of Parent Common Stock issued in the Merger, except, in each case, pursuant to
an effective registration statement or in compliance with Rule 145, as amended
from time to time, or in a transaction which, in the opinion of legal counsel
satisfactory to Parent, is exempt from the registration requirements of the
Securities Act.

SECTION 6.5 Expenses and Fees. Expenses (as defined in this Section 6.5)
incurred in connection with this Agreement and the Transactions shall be paid by
the party incurring such Expenses, except that those Expenses incurred in
connection with printing and filing the Registration Statement and the Joint
Proxy Statement/Prospectus shall be shared equally by Parent and Cereus. For
purposes of this Agreement, the term "EXPENSES" shall mean, with respect to any
party hereto, all reasonable out-of-pocket expenses (including all fees and
expenses of counsel, accountants, investment bankers, experts and consultants to
a party hereto and its affiliates, but excluding any allocation of overhead)
incurred by such
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party or on its behalf in connection with or related to the authorization,
preparation, negotiation, execution and performance of its obligations pursuant
to this Agreement and the consummation of the Merger, the preparation, printing,
filing and mailing of the Registration Statement, and the Joint Proxy Statement/
Prospectus, the solicitation of stockholder or shareholder approvals, any
filings made under the HSR Act and all other matters related to the Closing.

SECTION 6.6 Agreement To Cooperate.

(a) Subject to the terms and conditions herein provided and subject to the
fiduciary duties of the respective Boards of Directors of each Company, each of
the parties hereto shall use all reasonable efforts to take, or cause to be
taken, all action and to do, or cause to be done, all things necessary, proper
or advisable under applicable laws and regulations to consummate and make
effective the Transactions, including using its reasonable efforts to obtain all
necessary or appropriate waivers, consents or approvals of third parties
required in order to preserve material contractual relationships of each Company
and their respective Subsidiaries, all necessary or appropriate waivers,
consents and approvals and SEC "no-action" letters to effect all necessary
registrations, filings and submissions and to lift any injunction or other legal
bar to the Merger (and, in such case, to proceed with the Merger as
expeditiously as possible).

(b) Without limitation of the foregoing, each of Parent and Cereus
undertakes and agrees to file as soon as practicable, and in any event prior to
August 15, 2000, a Notification and Report Form under the HSR Act with the FTC
and the Antitrust Division. Each of Parent and Cereus shall (i) respond as
promptly as practicable to any inquiries received from the FTC or the Antitrust
Division for additional information or documentation and to all inquiries and
requests received from any State Attorney General or other governmental
authority in connection with antitrust matters and (ii) not extend any waiting
period under the HSR Act or enter into any agreement with the FTC or the
Antitrust Division not to consummate the Transactions, except with the prior
written consent of the other parties hereto. Each party shall promptly notify
the other party of any communication to that party from the FTC, the Antitrust
Division, any State Attorney General or any other governmental entity and permit
the other party to review in advance any proposed communication to any of the
foregoing.

(c) In the event any litigation is commenced by any person or entity
relating to the Transactions, either party shall have the right, at its own
expense, to participate therein, and each Company will not settle any such
litigation without the consent of the other, which consent will not be
unreasonably withheld.

(d) In case at any time after the Effective Time any further action is
necessary or desirable to carry out the purposes of this Agreement, the proper
officers and/or directors of Parent, Cereus and the Surviving Corporation shall
take all such necessary action.

(e) Following the Effective Time, Parent shall conduct its business, and
shall cause the Surviving Corporation to conduct its business, in a manner which
would not jeopardize the characterization of the Merger as a reorganization
described in Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code. In this regard,
Parent shall cause the Surviving Corporation to continue its historic business
or use a significant portion of its historic business assets in a business
within the meaning of Section 368 of the Code. Moreover, Parent does not have
any present plan or intent to (a) sell or otherwise dispose of the stock of the
Surviving Corporation except for transfers of stock to corporations controlled
(within the meaning of Section 368(c) of the Code) by Parent, (b) reacquire any
of its stock issued in connection with the Merger, (c) cause the Surviving
Corporation to issue shares of stock of the Surviving Corporation that would
result in Parent losing "control" (within the meaning of Section 368(c) of the
Code) of the Surviving Corporation, or (d) take or refrain from taking, or
permit the Surviving Corporation to take or refrain from taking, any other
action that might otherwise cause the Merger not to be treated as a
reorganization within the meaning of Sections 368(a)(1)(A) and 368(a)(2)(E) of
the Code. Parent and Cereus Acquiring Sub will provide Cereus with certain
factual representations of Parent and Cereus Acquiring Sub reasonably requested
by Cereus as necessary to confirm that Parent and Cereus Acquiring Sub will not
take any action on or after the Effective Time that would jeopardize the tax
free nature of the Merger.
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SECTION 6.7 Public Statements. Each Company shall consult with each other
prior to issuing any press release or any written public statement with respect
to this Agreement or the Transactions and shall not issue any such press release
or written public statement prior to such consultation.

SECTION 6.8 Notification of Certain Matters. Each of Parent and Cereus
agrees to give prompt notice to each other of, and to use commercially
reasonable efforts to remedy, (i) the occurrence or failure to occur of any
event which occurrence or failure to occur would be likely to cause any of its
representations or warranties in this Agreement to be untrue or inaccurate in
any material respect on the Closing Date and (ii) any material failure on its
part to comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it thereunder; provided, however, that the
delivery of any notice pursuant to this Section 6.8 shall not limit or otherwise
affect the remedies available hereunder to the party receiving such notice.

SECTION 6.9 Directors' and Officers' Indemnification.

(a) The indemnification provisions of the Certificate of Incorporation and
Bylaws of the Surviving Corporation as in effect at the Effective Time shall not
be amended, repealed or otherwise modified for a period of three years from the
Effective Time in any manner that would adversely affect the rights thereunder
of individuals who at the Effective Time were directors, officers, employees or
agents of Cereus. Parent hereby guaranties unconditionally the satisfaction of
all such rights to indemnification.

(b) In the event the Surviving Corporation or Parent or any of their
successors or assigns (i) consolidates with or merges into any other person and
shall not be the continuing or surviving corporation or entity of such
consolidation or merger or (ii) transfers all or substantially all of its
properties and assets to any person, then and in each such case, proper
provisions shall be made so that the successors and assigns of the Surviving
Corporation or Parent shall assume the obligations of the Surviving Corporation
or the Parent, as the case may be, set forth in this Section 6.9.

(c) For a period of six years after the Effective Time, Parent shall cause
to be maintained in effect for each director and officer of Cereus and its
Subsidiaries as of the Effective Time, liability insurance coverage with respect
to matters arising at or prior to the Effective Time, in such amounts and
containing such terms and conditions that are not materially less advantageous
to such parties than the coverage applicable to such individuals immediately
prior to the Effective Time.

(d) The rights of each indemnified party hereunder shall be in addition to,
and not in limitation of, any other rights such indemnified party may have under
the charter or Bylaws of Cereus, any indemnification agreement, under the DGCL,
or otherwise. The provisions of this Section 6.9 shall survive the consummation
of the Merger and expressly are intended to benefit each of the indemnified
parties.

SECTION 6.10 Corrections to the Joint Proxy Statement/Prospectus and
Registration Statement. Prior to the date of approval of the Merger by their
respective stockholders, each of Cereus and Parent shall correct promptly any
information provided by it to be used specifically in the Joint Proxy Statement/
Prospectus and Registration Statement that shall have become false or misleading
in any material respect and shall take all steps necessary to file with the SEC
and have declared effective or cleared by the SEC any amendment or supplement to
the Joint Proxy Statement/Prospectus or the Registration Statement so as to
correct the same and to cause the Joint Proxy Statement/Prospectus as so
corrected to be disseminated to the stockholders of Cereus and Parent, in each
case to the extent required by applicable law.

SECTION 6.11 Listing. Parent shall use its reasonable best efforts to
effect, at or before the Effective Time, authorization for listing on NASDAQ,
upon official notice of issuance, of the shares of Parent Common Stock to be
issued pursuant to the Merger or to be reserved for issuance upon the exercise
of stock options.

SECTION 6.12 Parent Board of Directors. At and after the Effective Time,
the Board of Directors of Parent shall include the same members of the Board of
Directors of Cereus as existed immediately prior to the Effective Time, and will
also include (a) one individual designated by Parent and acceptable to

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Cereus, and (b) the current Chairman of the Board of Directors of Parent (who
shall serve as Chairman of the Board of Directors of Parent at and after the
Effective Time). At the Effective Time, Parent shall secure the resignation of
each other member of its Board of Directors.

SECTION 6.13 Bridge Facility. On or around June 12, 2000, Parent and
Cereus entered into a commitment letter substantially in the form attached
hereto as Exhibit 6.13 (the "BRIDGE FACILITY"). Prior to Closing, Cereus will
execute amended loan documents (the "CEREUS AMENDED LOAN DOCUMENTS") to provide
an additional $5 million in borrowing availability thereunder to Parent (the
"ADDITIONAL CEREUS LOAN") on terms substantially similar to the original
borrowing availability under the Bridge Facility; provided, however, that
Cereus' obligation to execute the Cereus Amended Loan Documents shall be
conditioned upon:

(i) PNC amending Parent's Undrawn Availability covenant, as described
in Section 6.10 of Parent's Credit Agreement with PNC dated March 14, 2000,
as amended (the "PNC CREDIT AGREEMENT"), to reflect a $1 million amount,
and

(ii) PNC amending the financial covenants set forth in Sections 6.5,
7.6 and 7.11 of the PNC Credit Agreement in a manner satisfactory to Cereus
in the exercise of its reasonable discretion (together with (i) above, the
"PNC CONDITIONS").

SECTION 6.14 Employment Agreements. At the Closing, Parent shall execute
and deliver to each of Steven A. Odom, James M. Logsdon and Juliet M. Reising
(each an "EXECUTIVE") an executive employment agreement with Parent in
substantially the same form as each Executive has with Cereus on the date
hereof; it being understood that, in the case of Mr. Odom, he shall not serve as
Chairman of the Board of Directors of Parent.

SECTION 6.15 Executive Officers of Parent. Effective at or immediately
prior to the Effective Time, the Board of Directors of Parent shall take all
actions necessary (if any) to cause (i) Steven A. Odom to be elected as Chief
Executive Officer of Parent, (ii) James M. Logsdon to be elected as President
and Chief Operating Officer of Parent, and (iii) Juliet M. Reising to be elected
as Chief Financial Officer and Executive Vice President of Parent.

SECTION 6.16 Corporate Name. Parent shall take all action necessary,
including amending the Parent's Articles of Incorporation, in order to effect
and implement, as of the Effective Time the change of the corporate name of
Parent to such other name as Parent and Cereus may agree, provided that such
other name shall not be Eltrax Systems, Inc. or any name similar thereto.

ARTICLE VII

CONDITIONS

SECTION 7.1 Conditions to Each Party's Obligation to Effect the
Merger. The respective obligations of each party to effect the Merger shall be
subject to the fulfillment at or prior to the Closing Date of the following
conditions:

(a) the Cereus's Stockholders' Approval and the Parent Stockholders'
Approval;

(b) Intentionally omitted;

(c) the Registration Statement shall have been declared effective by the
SEC in accordance with the provisions of the Securities Act, and no stop order
suspending such effectiveness shall have been issued and remain in effect and no
proceeding for that purpose shall have been instituted by the SEC or any state
regulatory authorities;

(d) the shares of Parent Common Stock issuable in the Merger and those to
be reserved for issuance upon exercise of stock options shall have been
authorized for listing on the NASDAQ upon official notice of issuance;

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(e) no preliminary or permanent injunction or other order or decree by any
federal or state court which prevents the consummation of the Merger shall have
been issued and remain in effect (each party agreeing to use its reasonable
efforts to have any such injunction, order or decree lifted);

(f) no statute, rule or regulation shall have been enacted by any state or
federal government or governmental agency in the United States which would
prevent the consummation of the Merger or make the Merger illegal;

(g) the waiting period applicable to the consummation of the Transactions
under the HSR Act shall have expired or been terminated; and

(h) all governmental waivers, consents, orders and approvals legally
required for the consummation of the Merger and the Transactions, including, but
not limited to, the Cereus Required Statutory Approvals and the Parent Required
Statutory Approvals, and all consents from lenders, lessors, or other third
parties required to consummate the Merger, shall have been obtained and be in
effect at the Effective Time, except where the failure to obtain the same would
not be reasonably likely, individually or in the aggregate, to have a material
adverse effect on the business, operations, properties, assets, liabilities,
condition (financial or other) or results of operations of Cereus, Parent and
their Subsidiaries, taken as a whole, following the Effective Time.

SECTION 7.2 Additional Conditions to Obligation of Cereus to Effect the
Merger. Unless waived by Cereus, the obligation of Cereus to effect the Merger
shall be subject to the fulfillment at the Closing Date of the following
additional conditions:

(a) Parent and Cereus Acquiring Sub shall each have performed their
obligations contained in this Agreement required to be performed on or prior to
the Closing Date and the representations and warranties of Parent and Cereus
Acquiring Sub contained in this Agreement shall be true and correct on and as of
the date made and (except to the extent that such representations and warranties
speak as of an earlier date) on and as of the Closing Date as if made at and as
of such date, except for such failures to perform or to be true and correct that
would not reasonably be expected to result in a Parent Material Adverse Effect,
and Cereus shall have received a certificate of the Chairman of the Board of
Parent to that effect;

(b) Cereus and each of the directors of Parent shall have entered into a
proxy agreement substantially in the form attached hereto as Exhibit 7.2,
pursuant to which, among other things, each such director has granted to Cereus
a proxy to vote all of the shares of Parent Common Stock held by such director
in favor of the Merger;

(c) Rogers & Hardin LLP, legal counsel to Cereus, shall have issued its
opinion, such opinion dated on or about the date of the Closing, addressed to
Cereus, and reasonably satisfactory to it, based upon certain representations of
Cereus, Parent and Cereus Acquiring Sub and certain assumptions, to the effect
that: (i) the Merger will qualify as a tax-free "reorganization" under Section
368(a) of the Code, (ii) no gain or loss will be recognized by Parent or Cereus
by reason of the Merger, (iii) no gain or loss will be recognized by any
stockholder of Cereus upon the exchange of Cereus Common Stock solely for Parent
Common Stock in the Merger, (iv) the basis of the Parent Common Stock received
by each Cereus stockholder who exchanges Cereus Common Stock for Parent Common
Stock in the Merger will be the same as the stockholder's basis in the Cereus
Common Stock surrendered in exchange therefor (subject to any adjustments
required as the result of receipt of cash in lieu of a fractional share of
Parent Common Stock), (v) the holding period of the Parent Common Stock received
by each Cereus stockholder in the Merger will include the holding period of the
Cereus Common Stock surrendered in exchange therefor, provided that such shares
of Cereus Common Stock were held as a capital asset by such stockholder at the
Effective Time, and (vi) cash received by each Cereus stockholder in lieu of a
fractional share interest of Parent Common Stock as part of the Merger will be
treated as having been received as a distribution in full payment in exchange
for the fractional share interest of Parent Common Stock which such stockholder
would otherwise be entitled to receive and will qualify as capital gain or loss
(assuming the Cereus

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Common Stock was a capital asset in such stockholder's hands at the Effective
Time), which opinion shall not have been withdrawn or modified in any material
respect; and

(d) Cereus shall not have received pursuant to Section 262 written notice
of intent to demand payment in connection with the Transaction with respect to
more than 350,000 shares of Cereus Common Stock.

SECTION 7.3 Additional Conditions to Obligation of Parent to Effect the
Merger. Unless waived by Parent, the obligation of Parent to effect the Merger
shall be subject to the fulfillment at the Closing Date of the following
additional conditions:

(a) Cereus shall have performed obligations contained in this Agreement
required to be performed on or prior to the Closing Date and the representations
and warranties of Cereus contained in this Agreement shall be true and correct
on and as of the date made and (except to the extent that such representations
and warranties speak as of an earlier date) on and as of the Closing Date as if
made at and as of such date except for such failures to perform or to be true
and correct that would not reasonably be expected to result in a Cereus Material
Adverse Effect, and Parent shall have received a certificate of the Chief
Executive Officer of Cereus to that effect; and

(b) Parent and each of the directors of Cereus shall have entered into a
proxy agreement substantially in the form attached hereto as Exhibit 7.3,
pursuant to which, among other things, each such director has granted to Parent
a proxy to vote all of the shares of Cereus Common Stock held by such director
in favor of the Merger.

ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER

SECTION 8.1 Termination. This Agreement may be terminated and the Merger
may be abandoned at any time prior to the Effective Time, notwithstanding any
requisite adoption and approval of this Agreement, as follows:

(a) by mutual written consent duly authorized by the Boards of Directors of
each of Parent and Cereus;

(b) by either Parent or Cereus, if the Effective Time shall not have
occurred on or before December 31, 2000; provided, however, that in the event
that the Effective Time has not occurred by such time solely due to the failure
to satisfy the condition specified in Section 7.1(g) or 7.1(h), then such date
may be extended, at the option of Parent or Cereus, until January 31, 2001; and
provided further, however, that the right to terminate this Agreement under this
Section 8.1(b) shall not be available to any party whose failure to fulfill any
obligation under this Agreement shall have caused, or resulted in, the failure
of the Effective Time to occur on or before such date;

(c) by either Parent or Cereus, if any injunction, order or decree of the
type described in Section 7.1(e) hereof shall have been entered and shall have
become final and nonappealable, provided that the party seeking to terminate
this Agreement pursuant to this Section 8.1(c) shall have used its best efforts
to prevent the entry of and to remove such injunction, order or decree;

(d) by Cereus, if prior to the Parent Stockholders' Approval, (i) the Board
of Directors of Parent withdraws, modifies or changes its recommendation of the
issuance of the Parent Common Stock in the Merger or shall have resolved to do
so; or (ii) the Board of Directors of Parent shall have recommended to the
shareholders of Parent a Competing Transaction or shall have resolved to do so;

(e) by Parent if, prior to the Cereus Stockholders' Approval, (i) the Board
of Directors of Cereus withdraws, modifies or changes its recommendation of this
Agreement or the Merger or shall have resolved to do so, or (ii) the Board of
Directors of Cereus shall have recommended to the stockholders of Cereus a
Competing Transaction or shall have resolved to do so;

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(f) by (i) Cereus if this Agreement and the Merger shall fail to receive
the requisite votes for the Parent Stockholders' Approval or (ii) Parent if this
Agreement and the Merger shall fail to receive the requisite votes for the
Cereus Stockholders' Approval;

(g) by Cereus, upon a breach of any representation, warranty, covenant or
agreement on the part of Parent and Cereus Acquiring Sub set forth in this
Agreement, or if any representation or warranty of Parent shall have become
untrue, incomplete or incorrect, in either case such that the conditions set
forth in Section 7.2(a) would not be satisfied (a "TERMINATING PARENT BREACH");
provided, however, that if such Terminating Parent Breach is curable by Parent
through the exercise of its reasonable efforts within 30 days after written
notice of such default specifying in reasonable detail the nature of such
default is given to Parent by Cereus, and for so long as Parent continues to
exercise such reasonable efforts, Cereus may not terminate this Agreement under
this Section 8.1(g); and provided further, however, that the preceding proviso
shall not in any event be deemed to extend any date set forth in Section 8.1(b);
and provided further, however, that Cereus may not terminate this Agreement
under this Section 8.1(g) by reason of any breach of the representations and
warranties in Section 4.13 that is caused by, or that results from, any action
or inaction of any of Cereus's representatives on the Steering Committee;

(h) by Parent, upon breach of any representation, warranty, covenant or
agreement on the part of Cereus set forth in this Agreement, or if any
representation or warranty of Cereus shall have become untrue, incomplete or
incorrect, in either case such that the conditions set forth in Section 7.3(a)
would not be satisfied (a "TERMINATING CEREUS BREACH"); provided, however, that
if such Terminating Cereus Breach is curable by Cereus through the exercise of
its reasonable efforts within 30 days after written notice of such default
specifying in reasonable detail the nature of such default is given to Cereus by
Parent, and for so long as Cereus continues to exercise such reasonable efforts,
Parent may not terminate this Agreement under this Section 8.1(h); and provided
further, however, that the preceding proviso shall not in any event be deemed to
extend any date set forth in Section 8.1(b);

(i) by Parent at any time if Cereus materially breaches the terms of the
loan agreements, including, without limitation, the Cereus Amended Loan
Documents, executed pursuant to the Bridge Facility;

(j) by Parent, if Steven A. Odom does not execute the executive employment
agreement referenced in Section 6.14; or

(k) by Parent, if the PNC Conditions have been satisfied and Cereus has
failed to execute the Cereus Amended Loan Documents within ten (10) business
days of such satisfaction.

SECTION 8.2 Effect of Termination. Except as provided in Section 8.5, in
the event of termination of this Agreement pursuant to Section 8.1, this
Agreement shall forthwith become void, there shall be no liability under this
Agreement on the part of any party hereto or any of its affiliates or any of its
or their officers or directors, and all rights and obligations of each party
hereto shall cease, subject to the remedies of the parties hereto set forth in
Section 8.5(b); provided, however, that nothing herein shall relieve any party
hereto from liability for the willful or intentional breach of any of its
representations and warranties or the willful or intentional breach of any of
its covenants or agreements set forth in this Agreement.

SECTION 8.3 Amendment. This Agreement may be amended by the parties hereto
by action taken by or on behalf of their respective Boards of Directors at any
time prior to the Effective Time; provided, however, that, after the Cereus
Stockholders' Approval and the Parent Stockholders' Approval, no amendment may
be made, except such amendments that have received the requisite stockholder
approval and such amendments as are permitted to be made without stockholder
approval under the Minnesota Business Corporation Act and the DGCL, as
applicable. This Agreement may not be amended except by an instrument in writing
signed by the parties hereto.

SECTION 8.4 Waiver. At any time prior to the Effective Time, any party
hereto may (a) extend the time for or waive compliance with the performance of
any obligation or other act of any other party hereto or (b) waive any
inaccuracy in the representations and warranties contained herein or in any
document

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delivered pursuant hereto. Any such extension or waiver shall be valid if set
forth in an instrument in writing signed by the party or parties to be bound
thereby.

SECTION 8.5 Termination Fees and Expenses.

(a) In the event that Cereus shall terminate this Agreement pursuant to (A)
Section 8.1(f)(i); (B) Section 8.1(d); or (C) Section 8.1(b) and at the time of
any such termination pursuant to subpart (A), (B) or (C) hereof there shall
exist or be proposed a Competing Transaction with respect to Parent and, within
12 months thereafter, Parent shall enter into a definitive agreement with
respect to any Competing Transaction or any Competing Transaction shall be
consummated, then Parent shall pay to Cereus an amount equal to $5.0 million
plus all of Cereus's Expenses, as evidenced by reasonable documentation, up to
an aggregate of $1.0 million, promptly after the execution and delivery of such
agreement or the consummation of such Competing Transaction.

(b) In the event that Parent shall terminate this Agreement pursuant to (A)
Section 8.1(f)(ii); (B) Section 8.1(e); or (C) Section 8.1(b) and at the time of
any such termination pursuant to subpart (A), (B) or (C) hereof there shall
exist or be proposed a Competing Transaction with respect to Cereus and, within
12 months thereafter, Cereus shall enter into a definitive agreement with
respect to any Competing Transaction or any Competing Transaction shall be
consummated, then Cereus shall pay to Parent an amount equal to $5.0 million
plus all of Parent's Expenses, as evidenced by reasonable documentation, up to
an aggregate of $1.0 million, promptly after the execution and delivery of such
agreement or the consummation of such Competing Transaction.

(c) In the event that Cereus shall terminate this Agreement pursuant to
Section 8.1(g) or Section 8.1(f)(i) and Parent is not otherwise entitled to
payment pursuant to Section 8.5(a), then Parent shall pay to Cereus within two
business days after such termination an amount equal to $2.5 million plus all of
Cereus's Expenses, as evidenced by reasonable documentation, up to an aggregate
of $1.0 million; provided, however, that, in the event both Parent and Cereus
would otherwise be entitled to payments under this Section 8.5 in connection
with the termination of this Agreement pursuant to both Sections 8.5(f)(i) and
(f)(ii), neither party shall be required to make any payment under this Section
8.5.

(d) In the event that Parent shall terminate this Agreement pursuant to
Section 8.1(h) or Section 8.1(f)(ii) and Cereus is not otherwise entitled to
payment pursuant to Section 8.5(b), then Cereus shall pay to Parent within two
business days after such termination an amount equal to $2.5 million plus all of
Parent's Expenses, as evidenced by reasonable documentation, up to an aggregate
of $1.0 million; provided, however, that, in the event both Cereus and Parent
would otherwise be entitled to payments under this Section 8.5 in connection
with the termination of this Agreement pursuant to both Sections 8.5(f)(i) and
(f)(ii), neither party shall be required to make any payment under this Section
8.5.

(e) Any payment required to be made pursuant to this Section 8.5 shall be
made not later than the date of the entry into an agreement referred to therein
and two business days after delivery to the paying party of notice of demand for
payment and shall be made by wire transfer of immediately available funds to an
account designated by the other Company in the notice of demand for payment
delivered pursuant to this Section 8.5(c). In no event shall either Company be
entitled to collect amounts pursuant to this Section 8.5 relating to more than
one specified event.

(f) Except to the extent provided in the loan agreements executed pursuant
to the Bridge Facility, the fees set forth in this Section 8.5 shall constitute
the sole and exclusive remedy for any loss, liability, damage or claim arising
out of or in connection with any nonperformance of a covenant, breach, failure
of a condition precedent or termination of this Agreement.

ARTICLE IX

GENERAL PROVISIONS

SECTION 9.1 Non-Survival of Representations and Warranties. No
representations, warranties or obligations in this Agreement or in any
instrument delivered pursuant to this Agreement shall survive the
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Merger, and after the Effective Date of the Merger neither Parent nor Cereus, or
their respective officers or directors shall have any further obligation with
respect thereto, except for the representations, warranties and agreements
contained in Articles II and IX and in Sections 1.4, 1.5, 1.6, 5.1(b), 5.1(c),
5.1(d), 6.1, 6.5, 6.6 (including any factual representations set forth in a
certificate delivered to Cereus pursuant thereto) and 6.9, all of which shall
survive the Merger.

SECTION 9.2 Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered personally, mailed by
registered or certified mail (return receipt requested) or sent via confirmed
facsimile to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):

(a) If to Cereus, to:

Cereus Technology Partners, Inc.
1000 Abernathy Road
400 Northpark, Suite 1000
Atlanta, Georgia 303028
Facsimile No.: (770) 668-0961

Attn: Chief Executive Officer

with a copy to:

Rogers & Hardin LLP
2700 International Tower
229 Peachtree Street, N.E.
Atlanta, Georgia 30303
Attn: Steven E. Fox, Esq.
Facsimile No.: (404) 525-2224

(b) If to Parent, to:

Eltrax Systems, Inc.
400 Galleria Parkway, Suite 300
Atlanta, Georgia 30339
Attn: Chairman of the Board
Facsimile No.: (678) 589-3570

with a copy to:

Jaffe, Raitt, Heuer & Weiss, Professional Corporation
One Woodward Avenue
Suite 2400
Detroit, Michigan 48226
Attn: William E. Sider, Esq.
Facsimile No.: (313) 961-8358

(c) If to Cereus Acquiring Sub, to:
Solemn Acquisition Corporation
400 Galleria Parkway, Suite 300
Atlanta, Georgia 30339
Attn: Chairman of the Board
Facsimile No.: (678) 589-3570

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with a copy to:

Jaffe, Raitt, Heuer & Weiss, Professional Corporation
One Woodward Avenue
Suite 2400
Detroit, Michigan 48226
Attn: William E. Sider, Esq.
Facsimile No.: (313) 961-8358

SECTION 9.3 Interpretation. The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. In this Agreement, unless a contrary intention
appears, (i) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision, (ii) reference to any Article or Section
means such Article or Section hereof, and (iii) the words "including" shall be
deemed to be followed by the words "without limitation". No provision of this
Agreement shall be interpreted or construed against any party hereto solely
because such party or its legal representative drafted such provision.

SECTION 9.4 Governing Law. This agreement shall be governed in all
respects, including validity, interpretation and effect, by the laws of the
State of Delaware applicable to contracts executed and to be performed wholly
within such state.

SECTION 9.5 Arbitration. Any controversy or claim arising out of or
relating to this agreement, or the making, performance or interpretation hereof,
including without limitation alleged fraudulent inducement hereof, will be
settled by binding arbitration in Georgia, by a panel of three arbitrators, of
which Parent will choose one arbitrator, Cereus will choose one arbitrator, and
those arbitrators will choose the third arbitrator, who will act as chairman of
the panel. The arbitrators will select the rules and procedures under which the
arbitration will be conducted. Judgment upon any arbitration award may be
entered in any court having jurisdiction thereof and the parties consent to the
jurisdiction of the courts of the State of Georgia for this purpose.

SECTION 9.6 Counterparts, Telecopied Signatures. This Agreement may be
executed in two or more counterparts, each of which shall be deemed to be an
original, but all of which shall constitute one and the same agreement. Any
signature delivered by a party by facsimile transmission shall be deemed to be
an original signature hereto.

SECTION 9.7 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto, and nothing in this Agreement,
express or implied, is intended to confer upon any other person any rights or
remedies of any nature whatsoever under or by reason of this Agreement.

SECTION 9.8 Miscellaneous. This Agreement (including the exhibits attached
hereto and the documents and instruments referred to herein): (a) constitutes
the entire agreement and supersedes all other prior agreements and
understandings, both written and oral, among the parties, or any of them, with
respect to the subject matter hereof; and (b) shall not be assigned by operation
of law or otherwise, except that Cereus Acquiring Sub may assign this Agreement
to any other wholly-owned Subsidiary of Parent.

[Signatures on following page]

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IN WITNESS WHEREOF, Parent, Cereus Acquiring Sub and Cereus have caused
this Agreement to be signed and delivered by their respective officers as of the
date first written above.

CEREUS TECHNOLOGY PARTNERS, INC.

By: /s/ STEVEN A. ODOM

------------------------------------
Its: Chief Executive Officer

SOLEMN ACQUISITION CORPORATION

By: /s/ JAMES M. LOGSDON
------------------------------------
Its: President

ELTRAX SYSTEMS, INC.

By: /s/ WILLIAM P. O'REILLY
------------------------------------
Its: Chief Executive Officer

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EXHIBIT 6.13

CEREUS TECHNOLOGY PARTNERS, INC.
1000 ABERNATHY ROAD, SUITE 1000
ATLANTA, GEORGIA 30328

June 12, 2000

Eltrax Systems, Inc.
400 Galleria Parkway, Suite 300
Atlanta, Georgia 30339
Attn: Chief Executive Officer

Re: Cereus $5 Million Bridge Facility

Ladies and Gentlemen:

The purpose of this Commitment Letter is to outline the manner in which
Cereus Technology Partners, Inc. ("Cereus") will proceed with a loan to Eltrax
Systems, Inc. ("Eltrax") of up to $5 million (the "Bridge Facility"). In
connection with the Bridge Facility and the execution of that certain Agreement
and Plan of Merger among Cereus, Eltrax and Solemn Acquisition Corporation dated
of even date herewith, to which this Commitment Letter is attached as Exhibit
6.13 (the "Merger Agreement"), Eltrax and Cereus each hereby agree as set forth
below. Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Merger Agreement.

1. Bridge Facility. Subject to the consent of Eltrax's bank lender,
PNC Bank, National Association ("PNC"), which Eltrax shall use its
reasonable best efforts to obtain, Cereus hereby commits to loan to Eltrax
up to an aggregate of $5 million in accordance with the terms and
conditions set forth in this Commitment Letter.

2. Process. Cereus and Eltrax shall negotiate the terms of definitive
agreements with respect to the Bridge Facility (the "Definitive
Agreements") and shall be prepared to execute and deliver the Definitive
Agreements and close the Bridge Facility by June 16, 2000. The Definitive
Agreements shall incorporate the terms and conditions set forth in Exhibit
A attached hereto and incorporated herein by this reference, as well as
customary representations, warranties, indemnities, covenants and
conditions.

3. Termination. This Commitment Letter shall terminate on the earliest
to occur of (i) the date on which either Cereus or Eltrax terminates the
Merger Agreement as provided therein, and (ii) the date that the Definitive
Agreements are executed and delivered by the parties hereto.
Notwithstanding any termination under this Section 3, Sections 4 through 9
hereof shall remain in full force and effect.

4. Concerning Remedies. Each of the parties hereto acknowledges and
agrees that no failure or delay in exercising any right, power or privilege
hereunder will operate as a waiver thereof, nor will any single or partial
exercise thereof preclude any other or further exercise thereof or the
exercise of any right, power or privilege hereunder.

5. Governing Law. This letter agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without
regard to the principles of conflicts of laws.

6. Submission to Jurisdiction Selection of Forum. CEREUS AND ELTRAX
EACH HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY GEORGIA STATE OR
FEDERAL COURT SITTING IN THE CITY OF ATLANTA, GEORGIA, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS COMMITMENT LETTER, AND CEREUS
AND ELTRAX EACH HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH GEORGIA STATE
COURT OR SUCH FEDERAL COURT.

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CEREUS AND ELTRAX EACH HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT
MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING.

7. Entire Agreement; Amendment. This Commitment Letter embodies the
entire agreement of the parties with respect to the Bridge Facility and
shall not be amended except by a written instrument executed by the parties
hereto.

8. Counterparts. This Commitment Letter may be executed in multiple
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument. Delivery of an executed signature
page to this Commitment Letter by facsimile transmission shall be as
effective as delivery of a manually signed counterpart hereof.

Please confirm that the foregoing accurately sets forth our agreement by
executing this Commitment Letter where indicated and returning it to Cereus.

Very truly yours,

CEREUS TECHNOLOGY PARTNERS, INC.

By:
----------------------------------
Its:
----------------------------------

ACKNOWLEDGED AND AGREED TO:

ELTRAX SYSTEMS, INC.

By:
----------------------------------
Its:
----------------------------------

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EXHIBIT A

SUMMARY OF BRIDGE FACILITY TO BE PROVIDED BY CEREUS

JUNE 12, 2000

Amount: Up to an aggregate of $5 million.

Term: All amounts outstanding under the Bridge Facility
will be due and payable on the first anniversary of
the closing of the Bridge Facility. The Bridge
Facility may be prepaid at any time without premium
or penalty.

Interest Rate: All amounts outstanding under the Bridge Facility
will earn interest through the end of the term at a
rate per annum equal to the Prime Rate, as
published by Bank of America, N.A., Atlanta,
Georgia, from time to time, plus 3%.

Advances: Advances under the Bridge Facility shall be made by
Cereus upon the written request of Eltrax only
after Eltrax has exhausted all of its remaining
credit available under its existing credit facility
with PNC. When any advance under the Bridge
Facility is intended to fund an expenditure that is
outside of Eltrax's normal course of business, the
Steering Committee must approve such expenditure
prior to funding such advance.

Security: The Bridge Facility will be secured by a lien on
all or substantially all of the assets of Eltrax,
which will be subordinated only to Eltrax's
existing credit facility with PNC.

Conversion: Prior to the expiration of its term, the
outstanding principal amount of the Bridge Facility
will be convertible by Cereus into that number of
shares of the common stock, par value $.01 per
share, of Eltrax obtained by multiplying (i) 1.15
by (ii) a fraction, the numerator of which is the
outstanding principal amount of the Bridge Facility
on the date of conversion and the denominator of
which is the per share closing price for the Eltrax
common stock on the day immediately prior to the
public announcement of the Merger.

Issuance of Warrants: If the Merger Agreement is terminated under
circumstances whereby Cereus is entitled to a
termination fee pursuant to Section 8.5 thereof,
then Eltrax will issue to Cereus warrants to
purchase shares of Eltrax common stock exercisable
at $.01 per share (the "Warrants") for that number
of shares of Eltrax common stock equal to the
outstanding principal amount of the Bridge Facility
on the date of the occurrence of the event giving
rise to the payment of any such termination fee
(the "Valuation Date"), divided by the closing
price per share of the Eltrax common stock on the
Valuation Date (the "Warrant Shares"); provided,
however, that Eltrax shall have the right to repay
the outstanding principal amount of the Bridge
Facility in full within thirty (30) days after the
Valuation Date, in which event Eltrax shall issue
to Cereus Warrants to purchase 25% of the Warrant
Shares that would have been issuable but for such
repayment.

Anti-Dilution Protection: Cereus shall receive proportional adjustments for
splits, dividends, recapitalizations, and the like
and, if the Merger Agreement is terminated pursuant
to Section 8.1 thereof and, at the time of such

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termination, Cereus shall be entitled to receive a
termination fee under Section 8.5 thereof, then
Cereus shall also receive "weighted average"
protection for issuances of Eltrax common stock or
securities convertible into Eltrax common stock at
a per share price below the per share closing price
for the Eltrax common stock on the day immediately
prior to the public announcement of the Merger.
Notwithstanding the foregoing, no adjustments shall
be made for shares of Eltrax common stock issued
pursuant to stock purchase, option, warrant and
related agreements outstanding as of the date of
the Merger Agreement.

Registration Rights: Cereus shall have registration rights in connection
with the resale of the Eltrax common stock issuable
to Cereus upon (i) the conversion of the
outstanding principal amount of the Bridge Facility
and (ii) the exercise of the Warrants
(collectively, the "Eltrax Securities") as follows:

(a) Cereus will have right to make one demand for
an underwritten registration of the Eltrax
Securities at any time within one year of the
conversion of the Bridge Facility or the
exercise of the Warrants, as the case may be.

(b) Cereus will have unlimited piggyback
registration rights other than with respect
to registrations on Form S-8 or S-4 or with
respect to any shelf registration filed under
Rule 415(a) (1)(viii).

(c) Registration rights will terminate at such
time as Cereus is eligible to sell all of its
Eltrax Securities under Rule 144(k).

(d) Cereus' registration rights will be subject
to reasonable market standoff provisions.

(e) Cereus will have two S-3 registration rights
if Eltrax is eligible therefor, but Cereus
may not demand such registration more than
once during any calendar year.

(f) Eltrax will pay all ordinary expenses of
registration.

(g) Both parties will be subject to typical
indemnification and contribution obligations
in connection with the registrations.

(h) Eltrax cannot grant registration rights on
terms more favorable than the registration
rights granted to Cereus hereunder without
Cereus' prior written consent.

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EXHIBIT 7.2
STOCKHOLDERS PROXY AGREEMENT

STOCKHOLDERS PROXY AGREEMENT (this "Agreement"), dated as of June , 2000,
among CEREUS TECHNOLOGY PARTNERS, INC., a Delaware corporation ("Cereus"), and
each other person and entity listed on the signature pages hereof (each, a
"Stockholder").

W I T N E S S E T H:

WHEREAS, as of the date hereof each Stockholder owns (either beneficially
or of record) the number of shares of common stock, par value $0.01 per share
("Company Common Stock"), of Eltrax Systems, Inc., a Minnesota corporation (the
"Company"), set forth opposite such Stockholder's name on Exhibit A hereto (all
such shares of Company Capital Stock owned by the Stockholders and any shares of
Company Capital Stock hereafter acquired by the Stockholders prior to the
termination of this Agreement being referred to herein as the "Shares");

WHEREAS, Cereus and the Company, among others, propose to enter into an
Agreement and Plan of Merger and Reorganization, dated as of the date hereof (as
the same may be amended from time to time, the "Merger Agreement"; capitalized
terms herein not otherwise defined herein shall have the meanings ascribed
thereto in the Merger Agreement), which provides, upon the terms and subject to
the conditions thereof, for the merger of a subsidiary of the Company with and
into Cereus (the "Merger"); and

WHEREAS, as a condition to the willingness of Cereus to enter into the
Merger Agreement, Cereus has requested that each Stockholder agree, and, in
order to induce Cereus to enter into the Merger Agreement, each Stockholder has
agreed, to grant Cereus proxies to vote such Stockholder's Shares;

NOW, THEREFORE, in consideration of the premises and of the mutual
agreements and covenants set forth herein and in the Merger Agreement, the
parties hereto agree as follows:

ARTICLE I

TRANSFER AND VOTING OF SHARES

SECTION 1.01 Transfer of Shares. During the term of this Agreement, and
except as otherwise provided herein, each Stockholder shall not (a) sell, pledge
or otherwise dispose of any of its Shares if such transaction would result in
the Stockholder no longer having the power to vote or cause to be voted the
Shares, (b) deposit its Shares into a voting trust or enter into a voting
agreement or arrangement with respect to such Shares or grant any proxy with
respect thereto or (c) enter into any contract, option or other arrangement or
undertaking with respect to the direct or indirect acquisition or sale,
assignment, transfer or other disposition of any of the Company Capital Stock if
such transaction would result in the Stockholder no longer having the power to
vote or cause to be voted the Shares.

SECTION 1.02 Voting of Shares; Further Assurances. (a) Each Stockholder,
by this Agreement, with respect to those Shares that it owns of record, does
hereby constitute and appoint Cereus, or any nominee of Cereus, with full power
of substitution, during and for the term of this Agreement, as its true and
lawful attorney and proxy, for and in its name, place and stead, to vote each of
such Shares as its proxy, at every annual, special or adjourned meeting of the
stockholders of the Company (including the right to sign its name (as
stockholder) to any consent, certificate or other document relating to the
Company that the law of the State of Minnesota may permit or require) (i) in
favor of the adoption of the Merger Agreement and approval of the Merger and the
other transactions contemplated by the Merger Agreement, (ii) against any
proposal for any recapitalization, merger, sale of assets or other business
combination between the Company and any person or entity (other than the Merger)
or any other action or agreement that would result in a breach of any covenant,
representation or warranty or any other

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obligation or agreement of the Company under the Merger Agreement or which could
result in any of the conditions to the Company's obligations under the Merger
Agreement not being fulfilled, and (iii) in favor of any other matter relating
to consummation of the transactions contemplated by the Merger Agreement. Each
Stockholder further agrees to cause the Shares owned by it beneficially to be
voted in accordance with the foregoing. Each Stockholder acknowledges receipt
and review of a copy of the Merger Agreement.

(b) Each Stockholder shall perform such further acts and execute such
further documents and instruments as may reasonably be required to vest in
Cereus the power to carry out the provisions of this Agreement.

(c) Nothing contained in this Agreement shall be deemed to restrict a
Stockholder who is also a director of the Company from taking actions in his
capacity as a director as may be permitted under the Merger Agreement.

SECTION 1.03 Term of Agreement. This Agreement shall be effective as of
the date hereof and shall expire on the earlier of (a) the Effective Time and
(b) the date of the termination of the Merger Agreement pursuant to its terms.

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS

Each Stockholder, severally and not jointly, hereby represents and warrants
to Cereus as follows:

SECTION 2.01 Due Organization, Etc. Such Stockholder (if it is a
corporation, partnership or other legal entity) is duly organized and validly
existing under the laws of the jurisdiction of its organization. Such
Stockholder has full power and authority (corporate or otherwise) to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
action (corporate or otherwise) on the part of such Stockholder. This Agreement
has been duly executed and delivered by or on behalf of such Stockholder and,
assuming its due authorization, execution and delivery by Cereus, constitutes a
legal, valid and binding obligation of such Stockholder, enforceable against
such Stockholder in accordance with its terms, subject to the effect of any
applicable bankruptcy, reorganization, insolvency, moratorium or similar laws
affecting creditors' rights generally and subject, as to enforceability, to the
effect of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

SECTION 2.02 No Conflicts; Required Filings and Consents. (a) The
execution and delivery of this Agreement by such Stockholder do not, and the
performance of this Agreement by such Stockholder will not, (i) conflict with or
violate the Certificate of Incorporation or By-Laws or similar organizational
documents of such Stockholder (in the case of a Stockholder that is a
corporation, partnership or other legal entity), (ii) conflict with or violate
any law, rule, regulation, order, judgment or decree applicable to such
Stockholder or by which it or any of its properties is bound or affected, or
(iii) result in any breach of or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, or result
in the creation of a lien or encumbrance on any of the property or assets of
such Stockholder or (if such Stockholder is a corporation) any of its
subsidiaries pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which such Stockholder is a party or by which such Stockholder or any of its
properties is bound or affected, except for any such breaches, defaults or other
occurrences that would not cause or create a material risk of non-performance or
delayed performance by such Stockholder of its obligations under this Agreement.

(b) The execution and delivery of this Agreement by such Stockholder do
not, and the performance of this Agreement by such Stockholder will not, require
any consent, approval, authorization or permit of, or filing with or
notification to, any governmental or regulatory authority, domestic or foreign,
except

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(i) for applicable requirements, if any, of the Exchange Act, and the HSR Act
and (ii) where the failure to obtain such consents, approvals, authorizations or
permits, or to make such filings or notifications, would not prevent or delay
the performance by such Stockholder of its obligations under this Agreement.

SECTION 2.03 Title to Shares. Other than to the extent described in
Exhibit A hereto, such Stockholder is the record or beneficial owner of its
Shares free and clear of any proxy or voting restriction other than pursuant to
this Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF CEREUS

Cereus hereby represents and warrants to each Stockholder as follows:

SECTION 3.01 Due Organization, Etc. Cereus is a corporation duly organized
and validly existing under the laws of the State of Delaware. Cereus has all
necessary corporate power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby by Cereus have been duly authorized by all necessary corporate action on
the part of Cereus. This Agreement has been duly executed and delivered by
Cereus and, assuming its due authorization, execution and delivery by the
Stockholders, constitutes a legal, valid and binding obligation of Cereus,
enforceable against Cereus in accordance with its terms.

SECTION 3.02 No Conflict; Required Filings and Consents. (a) The execution
and delivery of this Agreement by Cereus do not, and the performance of this
Agreement by Cereus will not, (i) conflict with or violate the Certificate of
Incorporation or By-laws of Cereus, (ii) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to Cereus or by which Cereus or
any of its properties is bound or affected, or (iii) result in any breach of or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, or result in the creation of a lien
or encumbrance on any of the property or assets of Cereus pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which Cereus is a party or by
which it or any of its properties is bound or affected, except for any such
breaches, defaults or other occurrences that would not cause or create a
material risk of non-performance or delayed performance by Cereus of its
obligations under this Agreement.

(b) The execution and delivery of this Agreement by Cereus do not, and the
performance of this Agreement by Cereus will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental
or regulatory authority, domestic or foreign, except (i) for applicable
requirements, if any, of the Exchange Act and the HSR Act and (ii) where the
failure to obtain such consents, approvals, authorizations or permits, or to
make such filings or notifications, would not prevent or delay the performance
by Cereus of its obligations under this Agreement.

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ARTICLE IV

GENERAL PROVISIONS

SECTION 4.01 Notices. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly given
or made as of the date delivered, mailed or transmitted, and shall be effective
upon receipt, if delivered personally, mailed by registered or certified mail
(postage prepaid, return receipt requested) to the parties at the following
addresses (or at such other address for a party as shall be specified by like
changes of address) or sent by electronic transmission to the telecopier number
specified below:

(a) If to Cereus

Cereus Technology Partners, Inc.
1000 Abernathy Road
400 Northpark, Suite 1000
Attention: Chief Executive Officer
Telecopier No.: (770) 668-0961

with a copy to:

Rogers & Hardin LLP
2700 International Tower
229 Peachtree Street, N.E.
Atlanta, Georgia 30303
Attention: Steven E. Fox, Esq.
Telecopier No.: (404) 525-2224

(b) If to a Stockholder, to such Stockholder's address set forth on Exhibit
A.

SECTION 4.02 Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

SECTION 4.03 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible to the fullest extent
permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.

SECTION 4.04 This Agreement constitutes the entire agreement of the
parties and supersedes all prior agreements and undertakings, both written and
oral, between the parties, or any of them, with respect to the subject matter
hereof.

SECTION 4.05 Assignment. This Agreement shall not be assigned by operation
of law or otherwise; provided, however, that Cereus may assign its rights,
interests and obligations hereunder to any successor or Cereus entity of Cereus
whose shares are registered under Section 12 of the Exchange Act (or will be so
registered at the Closing).

SECTION 4.06 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any person any right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement.

SECTION 4.07 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and

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that the parties shall be entitled to specific performance of the terms hereof,
in addition to any other remedy at law or in equity.

SECTION 4.08 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO
CONTRACTS EXECUTED AND TO BE PERFORMED ENTIRELY WITHIN THAT STATE. CEREUS AND
EACH OF THE STOCKHOLDERS EACH HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF
ANY GEORGIA STATE OR FEDERAL COURT SITTING IN THE CITY OF ATLANTA, GEORGIA, IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND
CEREUS AND EACH OF THE STOCKHOLDERS HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH GEORGIA
STATE COURT OR SUCH FEDERAL COURT. CEREUS AND EACH OF THE STOCKHOLDERS EACH
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING.

SECTION 4.09 Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first written above.

CEREUS TECHNOLOGY PARTNERS, INC.

By:
----------------------------------
Name: Steven A. Odom
Title: Chief Executive Officer

STOCKHOLDERS:

------------------------------------
WILLIAM P. O'REILLY

------------------------------------
JAMES C. BARNARD

------------------------------------
PATRICK J. DIRK

------------------------------------
STEPHEN E. RAVILLE

------------------------------------
WILLIAM G. TAYLOR

A-42
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EXHIBIT A

LIST OF STOCKHOLDERS

<TABLE>
<CAPTION>
NUMBER OF SHARES
OF COMPANY COMMON STOCK
OWNED BENEFICIALLY
NAME AND ADDRESS OF STOCKHOLDER AND OF RECORD
------------------------------- -----------------------
<S> <C>
William P. O'Reilly......................................... 1,559,858
400 Galleria Parkway Ste. 300
Atlanta, Georgia 30339
James C. Barnard............................................ 101,250
14308 Spyglass Ridge
Chesterfield, Missouri 63017
Patrick J. Dirk............................................. 373,825
Troy Group, Inc.
2331 South Pullman Street
Santa Ana, California 92705
Stephen E. Raville.......................................... 146,250
Pointe Communication, Inc.
1951 Airport Road, Suite 120
Atlanta, Georgia 30341
William G. Taylor........................................... 354,700
The Springs Company
P.O. Drawer 460
Lancaster, South Carolina 29721
</TABLE>

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EXHIBIT 7.3

STOCKHOLDERS PROXY AGREEMENT

STOCKHOLDERS PROXY AGREEMENT (this "Agreement"), dated as of June , 2000,
among ELTRAX SYSTEMS, INC., a Minnesota corporation (the "Company"), and each
other person and entity listed on the signature pages hereof (each, a
"Stockholder").

W I T N E S S E T H:

WHEREAS, as of the date hereof each Stockholder owns (either beneficially
or of record) the number of shares of common stock, par value $0.01 per share
("Cereus Common Stock"), of Cereus Technology Partners, Inc., a Delaware
corporation (the "Cereus"), set forth opposite such Stockholder's name on
Exhibit A hereto (all such shares of Cereus Common Stock owned by the
Stockholders and any shares of Cereus Common Stock hereafter acquired by the
Stockholders prior to the termination of this Agreement being referred to herein
as the "Shares");

WHEREAS, Company and the Cereus, among others, propose to enter into an
Agreement and Plan of Merger and Reorganization, dated as of the date hereof (as
the same may be amended from time to time, the "Merger Agreement"; capitalized
terms herein not otherwise defined herein shall have the meanings ascribed
thereto in the Merger Agreement), which provides, upon the terms and subject to
the conditions thereof, for the merger of Cereus with and into a subsidiary of
Company (the "Merger"); and

WHEREAS, as a condition to the willingness of Company to enter into the
Merger Agreement, Company has requested that each Stockholder agree, and, in
order to induce Company to enter into the Merger Agreement, each Stockholder has
agreed, to grant Company proxies to vote such Stockholder's Shares;

NOW, THEREFORE, in consideration of the premises and of the mutual
agreements and covenants set forth herein and in the Merger Agreement, the
parties hereto agree as follows:

ARTICLE I

TRANSFER AND VOTING OF SHARES

SECTION 1.01 Transfer of Shares. During the term of this Agreement, and
except as otherwise provided herein, each Stockholder shall not (a) sell, pledge
or otherwise dispose of any of its Shares if such transaction would result in
the Stockholder no longer having the power to vote or cause to be voted the
Shares, (b) deposit its Shares into a voting trust or enter into a voting
agreement or arrangement with respect to such Shares or grant any proxy with
respect thereto or (c) enter into any contract, option or other arrangement or
undertaking with respect to the direct or indirect acquisition or sale,
assignment, transfer or other disposition of any of the Cereus Common Stock if
such transaction would result in the Stockholder no longer having the power to
vote or cause to be voted the Shares.

Section 1.02 Voting of Shares; Further Assurances. (a) Each Stockholder,
by this Agreement, with respect to those Shares that it owns of record, does
hereby constitute and appoint Company, or any nominee of Company, with full
power of substitution, during and for the term of this Agreement, as its true
and lawful attorney and proxy, for and in its name, place and stead, to vote
each of such Shares as its proxy, at every annual, special or adjourned meeting
of the stockholders of the Cereus (including the right to sign its name (as
stockholder) to any consent, certificate or other document relating to the
Cereus that the law of the State of Delaware may permit or require) (i) in favor
of the adoption of the Merger Agreement and approval of the Merger and the other
transactions contemplated by the Merger Agreement, (ii) against any proposal for
any recapitalization, merger, sale of assets or other business combination
between the Cereus and any person or entity (other than the Merger) or any other
action or agreement that would result in a breach of any covenant,
representation or warranty or any other obligation

A-44
<PAGE> 196

or agreement of the Cereus under the Merger Agreement or which could result in
any of the conditions to the obligations of Cereus under the Merger Agreement
not being fulfilled, and (iii) in favor of any other matter relating to
consummation of the transactions contemplated by the Merger Agreement. Each
Stockholder further agrees to cause the Shares owned by it beneficially to be
voted in accordance with the foregoing. Each Stockholder acknowledges receipt
and review of a copy of the Merger Agreement.

(b) Each Stockholder shall perform such further acts and execute such
further documents and instruments as may reasonably be required to vest in
Company the power to carry out the provisions of this Agreement.

(c) Nothing contained in this Agreement shall be deemed to restrict a
Stockholder who is also a director of the Cereus from taking actions in his or
her capacity as a director as may be permitted under the Merger Agreement.

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS

Each Stockholder, severally and not jointly, hereby represents and warrants
to Company as follows:

SECTION 2.01 Due Organization, Etc. Such Stockholder (if it is a
corporation, partnership or other legal entity) is duly organized and validly
existing under the laws of the jurisdiction of its organization. Such
Stockholder has full power and authority (corporate or otherwise) to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
action (corporate or otherwise) on the part of such Stockholder. This Agreement
has been duly executed and delivered by or on behalf of such Stockholder and,
assuming its due authorization, execution and delivery by Company, constitutes a
legal, valid and binding obligation of such Stockholder, enforceable against
such Stockholder in accordance with its terms, subject to the effect of any
applicable bankruptcy, reorganization, insolvency, moratorium or similar laws
affecting creditors' rights generally and subject, as to enforceability, to the
effect of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

Section 2.02 No Conflicts; Required Filings and Consents. (a) The
execution and delivery of this Agreement by such Stockholder do not, and the
performance of this Agreement by such Stockholder will not, (i) conflict with or
violate the Certificate of Incorporation or By-Laws or similar organizational
documents of such Stockholder (in the case of a Stockholder that is a
corporation, partnership or other legal entity), (ii) conflict with or violate
any law, rule, regulation, order, judgment or decree applicable to such
Stockholder or by which it or any of its properties is bound or affected, or
(iii) result in any breach of or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, or result
in the creation of a lien or encumbrance on any of the property or assets of
such Stockholder or (if such Stockholder is a corporation) any of its
subsidiaries pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which such Stockholder is a party or by which such Stockholder or any of its
properties is bound or affected, except for any such breaches, defaults or other
occurrences that would not cause or create a material risk of non-performance or
delayed performance by such Stockholder of its obligations under this Agreement.

A-45
<PAGE> 197

to obtain such consents, approvals, authorizations or permits, or to make such
filings or notifications, would not prevent or delay the performance by such
Stockholder of its obligations under this Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to each Stockholder as follows:

SECTION 3.01 Due Organization, Etc. The Company is a corporation duly
organized and validly existing under the laws of the State of Minnesota. The
Company has all necessary corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby by the Company have been duly authorized by all
necessary corporate action on the part of the Company. This Agreement has been
duly executed and delivered by the Company and, assuming its due authorization,
execution and delivery by the Stockholders, constitutes a legal, valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms.

SECTION 3.02 No Conflict; Required Filings and Consents. (a) The execution
and delivery of this Agreement by the Company do not, and the performance of
this Agreement by the Company will not, (i) conflict with or violate the
Articles of Incorporation or By-laws of the Company, (ii) conflict with or
violate any law, rule, regulation, order, judgment or decree applicable to the
Company or by which the Company or any of its properties is bound or affected,
or (iii) result in any breach of or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, or result
in the creation of a lien or encumbrance on any of the property or assets of the
Company pursuant to, any note, bond, mortgage, indenture, contract, agreement,
lease, license, permit, franchise or other instrument or obligation to which the
Company is a party or by which it or any of its properties is bound or affected,
except for any such breaches, defaults or other occurrences that would not cause
or create a material risk of non-performance or delayed performance by the
Company of its obligations under this Agreement.

(b) The execution and delivery of this Agreement by the Company do not, and
the performance of this Agreement by the Company will not, require any consent,
approval, authorization or permit of, or filing with or notification to, any
governmental or regulatory authority, domestic or foreign, except (i) for
applicable requirements, if any, of the Exchange Act and the HSR Act and (ii)
where the failure to obtain such consents, approvals, authorizations or permits,
or to make such filings or notifications, would not prevent or delay the
performance by the Company of its obligations under this Agreement.

A-46
<PAGE> 198

ARTICLE IV

GENERAL PROVISIONS

(a) If to the Company

Eltrax Systems, Inc.
400 Galleria Parkway, Suite 300
Atlanta, Georgia 30339
Attention: Chief Executive Officer
Telecopier No.: (678) 589-3570

with a copy to:

Jaffe, Raitt, Heuer & Weiss, Professional Corporation
One Woodward Avenue
Suite 2400
Detroit, Michigan 48226
Attention: William E. Sider, Esq.
Telecopier No.: (313) 961-8358

(b) If to a Stockholder, to such Stockholder's address set forth on Exhibit
A.

SECTION 4.02 Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

SECTION 4.04 Entire Agreement. This Agreement constitutes the entire
agreement of the parties and supersedes all prior agreements and undertakings,
both written and oral, between the parties, or any of them, with respect to the
subject matter hereof.

SECTION 4.05 Assignment. This Agreement shall not be assigned by operation
of law or otherwise; provided, however, that the Company may assign its rights,
interests and obligations hereunder to any successor or parent entity of the
Company whose shares are registered under Section 12 of the Exchange Act (or
will be so registered at the Closing).

SECTION 4.07 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and

A-47
<PAGE> 199

that the parties shall be entitled to specific performance of the terms hereof,
in addition to any other remedy at law or in equity.

SECTION 4.08 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO
CONTRACTS EXECUTED AND TO BE PERFORMED ENTIRELY WITHIN THAT STATE. COMPANY AND
EACH OF THE STOCKHOLDERS EACH HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF
ANY GEORGIA STATE OR FEDERAL COURT SITTING IN THE CITY OF ATLANTA, GEORGIA, IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND
COMPANY AND EACH OF THE STOCKHOLDERS HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH
GEORGIA STATE COURT OR SUCH FEDERAL COURT. THE COMPANY AND EACH OF THE
STOCKHOLDERS EACH HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF
SUCH ACTION OR PROCEEDING.

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
or caused this Agreement to be executed and delivered by its duly authorized
officer, all as of the date first written above.

ELTRAX SYSTEMS, INC.

By:
----------------------------------
Name:
Title:

STOCKHOLDERS:

------------------------------------
STEVEN A. ODOM

------------------------------------
AMY L. NEWMARK

------------------------------------
JAMES M. LOGSDON

------------------------------------
JOSEPH W. WRIGHT, JR.

------------------------------------
GARY H. HECK

------------------------------------
JULIET M. REISING

------------------------------------
MAX E. BOBBITT

A-48
<PAGE> 200

EXHIBIT A

LIST OF STOCKHOLDERS

<TABLE>
<CAPTION>
NUMBER OF SHARES
OF COMPANY
COMMON STOCK
OWNED BENEFICIALLY
NAME AND ADDRESS OF STOCKHOLDER AND OF RECORD
------------------------------- ------------------
<S> <C>
Steven A. Odom.............................................. 675,825
Cereus Technology Partners, Inc.
400 Northpark, Suite 1000
1000 Abernathy Road
Atlanta, Georgia 30328
Amy L. Newmark.............................................. 250,000
21 Hedgerow Lane
Greenwich, Connecticut 06831
James M. Logsdon............................................ 205,000
Cereus Technology Partners, Inc.
400 Northpark, Suite 1000
1000 Abernathy Road
Atlanta, Georgia 30328
Joseph W. Wright, Jr. ...................................... 158,414
599 Lexington Avenue, 44th Floor
New York, NY 10022
Gary H. Heck................................................ 75,000
19638 Painted Ridge Loop
Bend, Oregon 97702
Juliet M. Reising........................................... 55,000
Cereus Technology Partners, Inc.
400 Northpark, Suite 1000
1000 Abernathy Road
Atlanta, Georgia 30328
Max E. Bobbitt.............................................. 50,000
70 Beachside Drive, Apt. 203
Vero Beach, Florida 32963
</TABLE>

A-49
<PAGE> 201

APPENDIX B
MORGAN KEEGAN
--------------------------------------------------------------------------------
MORGAN KEEGAN & COMPANY, INC.
MORGAN KEEGAN TOWER
FIFTY FRONT STREET
19(TH) FLOOR
MEMPHIS, TN 38103

August 4, 2000

Board of Directors
Eltrax Systems, Inc.
400 Galleria Parkway, Suite 300
Atlanta, GA 30339

Members of the Board:

We understand that Eltrax Systems, Inc. ("Eltrax" or the "Company") and
Cereus Technology Partners, Inc. ("Cereus") propose to enter into a Second
Amended and Restated Agreement and Plan of Merger, substantially in the form of
the draft dated July 27, 2000 (the "Agreement"), which provides, among other
things, for the merger of Cereus with and into the Company (the "Merger").
Pursuant to the Merger, Cereus will become a wholly-owned subsidiary of the
Company and each issued and outstanding share of Cereus common stock, par value
$.01 per share (the "Cereus Common Stock"), other than shares held in treasury
or owned by Cereus, or any subsidiary of Cereus or as to which dissenters'
rights have been perfected, shall be converted into the right to receive 1.75
shares of common stock, par value $.01 per share, of Eltrax (the "Eltrax Common
Stock") (the "Exchange Ratio"), and subject to adjustment in certain
circumstances. The terms and conditions of the Merger are more fully set forth
in the Agreement.

You have asked for our opinion as to whether the Exchange Ratio pursuant to
the Agreement is fair, from a financial point of view, to the holders of the
Eltrax Common Stock. We have not been requested to opine as to, and our opinion
does not in any manner address, Eltrax's underlying business decision to proceed
with or effect the Merger.

For purposes of the opinion set forth herein, we have:

i. reviewed certain publicly available financial statements and other
information of Eltrax and Cereus;

ii. reviewed certain internal financial statements and other financial
and operating data concerning Eltrax and Cereus prepared by the management
of Eltrax and Cereus, respectively;

iii. discussed the past and current operations and financial condition
and the prospects of Eltrax with senior executives of Eltrax, including
information relating to certain strategic, financial and operational
benefits anticipated by Eltrax's management from the Merger;

iv. discussed past and current operations and financial condition and
the prospects of Cereus with senior executives of Cereus, including
information relating to certain strategic, financial and operational
benefits anticipated by Cereus's management from the Merger;

v. reviewed the potential pro forma impact of the Merger on the
earnings per share of Eltrax;

vi. reviewed the reported historical prices and historical trading
activity for Eltrax Common Stock and Cereus Common Stock for the period
from July 1, 1999 to June 9, 2000.

B-1
<PAGE> 202

vii. compared the financial performance of Eltrax and Cereus and the
prices and trading activity of Eltrax Common Stock and Cereus Common Stock
with that of certain other publicly-traded companies in the information
technology infrastructure industry and their securities;

viii. reviewed the financial terms, to the extent publicly available,
of certain other business combinations and other transactions in the
information technology infrastructure industry that we deemed relevant;

ix. reviewed the draft Agreement and the terms of the Merger and
drafts of certain related agreements;

x. performed such other analyses and considered such other factors as
we deemed appropriate.

We have assumed and relied upon without independent verification the
accuracy and completeness of the information reviewed by us for the purposes of
this opinion and have not assumed any obligation independently to verify the
foregoing information. With respect to the internal financial statements and
other financial and operating data and discussions relating to strategic,
financial and operational benefits anticipated from the Merger provided by
Eltrax and Cereus, upon your advice and with your consent we have assumed that
they have been reasonably prepared on bases reflecting the best currently
available estimates and judgments of the respective managements of Eltrax and
Cereus. We have also assumed that there have been no material changes in
Eltrax's or Cereus's assets, financial condition, results of operations,
business or prospects since the respective dates of the last financial
statements made available to us. Upon your advice and with your consent we have
relied upon the assessment by the managements of Eltrax and Cereus of their
ability to retain key employees of Eltrax and Cereus, respectively, following
the Merger. We have also upon your advice and with your consent relied upon,
without independent verification, the assessment by the managements of Eltrax
and Cereus of (i) the strategic and other benefits expected to result from the
Merger, (ii) Eltrax's and Cereus's technologies, products or services, (iii) the
timing and risks associated with the integration of Cereus with Eltrax, (iv) the
validity of, and risks associated with, Eltrax's and Cereus's existing and
future technologies, products or services and (v) the fairness to the holders of
the Cereus Common Stock, from a financial point of view, of the terms of and
consideration received by Cereus in connection with Cereus's disposition of its
mineral operations. We have not made any independent valuation, inspection or
appraisal of the assets, liabilities or technology of Eltrax or Cereus, nor have
we been furnished with any such appraisals or valuations. In addition, you have
informed us, and we have assumed, that the Merger will be accounted as a
"purchase" business combination in accordance with U.S. generally accepted
accounting principles and the Merger will be treated as a tax-free
reorganization and/or exchange pursuant to the Internal Revenue Code of 1986 and
will be consummated in accordance with the terms set forth in the draft
Agreement and the applicable provisions of the Securities Act of 1933, as
amended (the "Securities Act"), the Securities Exchange Act of 1934, as amended,
and all other applicable federal, state and local statutes, rules, regulations
and ordinances. Our opinion is necessarily based on financial, economic, market
and other conditions as in effect on, and the information made available to us
as of, the date hereof. In addition, we are not expressing any opinion as to the
prices at which the Eltrax Common Stock may trade following the date of this
opinion.

In arriving at our opinion, we were not authorized to solicit, and did not
solicit, interest from any party with respect to the acquisition of the Company
of any of its assets.

The Company has agreed to indemnify us for certain liabilities that may
arise out of rendering this opinion. In the past, Morgan Keegan & Company, Inc.
and its affiliates have provided financial advisory and financing services for
Eltrax and have received customary fees for the rendering of these services. In
the ordinary course of our business, we may actively trade in the equity
securities of the Company for our own account and the accounts of our customers
and, accordingly, may at any time hold a significant long or short position in
such securities.

It is understood that this letter is for the information of the Board of
Directors of Eltrax only and may not be used for any other purpose without our
prior written consent, except that this opinion may be
B-2
<PAGE> 203

included in its entirety in any filing made by the Company in respect of the
transaction with the Securities and Exchange Commission. In furnishing this
opinion, we do not admit that we are experts within the meaning of the term
"experts" as used in the Securities Act and the rules and regulations
thereunder, nor do we admit that this opinion constitutes a report or valuation
within the meaning of Section 11 of the Securities Act. In addition, this
opinion does not address the relative merits of the Merger or any alternatives
to the Merger, Eltrax's underlying decision to proceed with or effect the Merger
or any other aspect of the Merger. Morgan Keegan expresses no opinion or
recommendation as to how shareholders of the Company or Cereus should vote with
respect to the Merger at the shareholders' meetings held in connection with the
Merger.

Based upon and subject to the foregoing, and in reliance thereon, we are of
the opinion on the date hereof that the Exchange Ratio is fair, from a financial
point of view, to the holders of the Eltrax Common Stock.

Very truly yours,

/s/MORGAN KEEGAN & COMPANY, INC.
Morgan Keegan & Company, Inc.

B-3
<PAGE> 204

APPENDIX C

[THE ROBINSON-HUMPHEY COMPANY LETTERHEAD]

July 27, 2000

Board of Directors
Cereus Technology Partners, Inc.
400 Northpark
1000 Abernathy Road, Suite 1000
Atlanta, Georgia 30328

Ladies and Gentlemen:

We understand that Cereus Technology Partners, Inc. (the "Company") is
considering a proposed merger of the Company with Eltrax Systems, Inc.
("Eltrax") by means of a reverse triangular merger in which a wholly-owned
subsidiary of Eltrax will merge with and into the Company. We understand that
under this merger (the "Proposed Transaction"), the Company's stockholders will
receive 1.75 shares of Eltrax's common stock in exchange for each share of the
Company's common stock, subject to adjustment in certain events (the "Exchange
Ratio"). Furthermore, we understand that the merger will be structured as a
tax-free reorganization and accounted for as a purchase. The terms and
conditions of the Proposed Transaction are set forth in more detail in the draft
Second Amended and Restated Agreement and Plan of Merger dated as of July 27,
2000 (the "Agreement").

We have been requested by the Company to render our opinion with respect to
the fairness, from a financial point of view, to the Company's common
stockholders of the Exchange Ratio pursuant to the Proposed Transaction.

In arriving at our opinion, we have, among other things:

1. Reviewed the Agreement;

2. Reviewed certain publicly available information concerning the Company
and Eltrax which we believe to be relevant to our analysis;

3. Reviewed certain financial and operating data concerning the Company and
Eltrax furnished to us by the Company and Eltrax, respectively;

4. Conducted discussions with members of the Company's and Eltrax's
management concerning their respective business, operations, assets,
present condition and prospects;

5. Reviewed the trading histories of the common stock of the Company and
Eltrax;

6. Reviewed the historical market prices and trading activities for the
common stock of the Company and Eltrax and compared them with those of
certain publicly traded companies which we deemed relevant;

7. Compared the historical financial results and present financial
condition of the Company and Eltrax with those of certain publicly
traded companies which we deemed relevant;

8. Reviewed the financial terms of the Proposed Transaction with the terms
of certain other recent merger and acquisition transactions which we
deemed relevant;

9. Performed certain financial analyses with respect to the Company's and
Eltrax's pro forma financial condition and projected future operating
performance;
C-1
<PAGE> 205
Board of Directors
Cereus Technology Partners, Inc.
July 27, 2000
Page 2

10. Reviewed certain historical data relating to percentage premiums paid
in mergers of publicly traded companies; and

11. Reviewed such other financial statistics and undertook such other
analyses and investigations as we deemed appropriate.

We have assumed and relied upon the accuracy and completeness of the
financial and other information used by us in arriving at our opinion without
independent verification. With respect to the financial forecasts of the Company
and Eltrax, including estimates of the cost savings and other potential
synergies anticipated to result from the Proposed Transaction, we have assumed
that such forecasts have been reasonably prepared and reflect the best currently
available estimates and judgments of the Company's and Eltrax's respective
management as to future financial performance. In arriving at our opinion, we
conducted only a limited physical inspection of the properties and facilities of
the Company and Eltrax. We have not made or obtained any evaluations or
appraisals of the assets or liabilities of the Company or Eltrax. Our opinion is
necessarily based upon market, economic and other conditions as they exist on,
and can be evaluated as of, the date of this letter.

We have acted as financial advisor to the Company in connection with the
Proposed Transaction and will receive a fee for our services. In addition, the
Company has agreed to indemnify us for certain liabilities arising out of the
rendering of this opinion. In the ordinary course of our business, we may
actively trade in the common stock of the Company or Eltrax for our own account
and for the accounts of our customers and, accordingly, may at any time hold a
long or short position in such securities.

Based upon and subject to the foregoing, we are of the opinion as of the
date hereof that the Exchange Ratio in the Proposed Transaction is fair from a
financial point of view to the common stockholders of the Company.

This opinion is for the use and benefit of the Board of Directors of the
Company and is rendered in connection with its consideration of the Proposed
Transaction. This opinion is not intended to be and does not constitute a
recommendation to any shareholder of the Company as to how such shareholder
should vote with respect to the Proposed Transaction.
Very truly yours,

/s/THE ROBINSON-HUMPHREY COMPANY, LLC
THE ROBINSON-HUMPHREY COMPANY, LLC

C-2
<PAGE> 206

APPENDIX D

ELTRAX SYSTEMS, INC.

1999 EMPLOYEE STOCK PURCHASE PLAN

1. PURPOSE OF THE PLAN. This Eltrax Systems, Inc. 1999 Employee Stock
Purchase Plan adopted as of the 16th day of November, 1999, is intended to
encourage eligible employees of the Company and its Subsidiaries to acquire or
increase their ownership of common stock of the Company on reasonable terms. The
opportunity so provided is intended to foster in participants a strong incentive
to put forth maximum effort for the continued success and growth of the Company
and its Subsidiaries, to aid in retaining individuals who put forth such
efforts, and to assist in attracting the best available individuals to the
Company and its Subsidiaries in the future. It is the Company's intention that
this Employee Stock Purchase Plan qualify as an "employee stock purchase plan"
under Section 423 of the Code. Accordingly, the provisions of the Plan shall be
construed so as to extend and limit participation in a manner consistent with
the requirements of that section of the Code.

2. DEFINITIONS. When used herein, the following terms shall have the
meanings set forth below:

2.2 "Account" means the funds accumulated with respect to an Employee as a
result of deductions from his paycheck for the purpose of purchasing Shares
under the Plan. The funds allocated to an Employee's Account shall remain the
property of the employee at all times but may be commingled with the general
funds of the Company.

2.3 "Board" means the Board of Directors of Eltrax Systems, Inc.

2.4 "Change in Control" will mean the following:

(a) the sale, lease, exchange or other transfer, directly or
indirectly, of substantially all of the assets of the Company (in one
transaction or in a series of related transactions) to a person or entity
that is not controlled by the Company;

(b) the approval by the shareholders of the Company of any plan or
proposal for the liquidation or dissolution of the Company;

(c) any person becomes after the effective date of the Plan the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of (A) 20% or more, but less than 50% of the
combined voting power of the Company's outstanding securities ordinarily
having the right to vote at elections of directors, unless the transaction
resulting in such ownership has been approved in advance by the Incumbent
Directors, or (B) 50% or more of the combined voting power of the Company's
outstanding securities ordinarily having the right to vote at elections of
directors (regardless of any approval by the Incumbent Directors);

(d) a merger or consolidation to which the Company is a party if the
shareholders of the Company immediately prior to effective date of such
merger or consolidation have "beneficial ownership" (as defined in Rule
13d-3 under the Exchange Act), immediately following the effective date of
such merger or consolidation, of securities of the surviving corporation
representing (i) more than 50%, but less than 80%, of the combined voting
power of the surviving corporation's then outstanding securities ordinarily
having the right to vote at elections of directors, unless such merger or
consolidation has been approved in advance by the Incumbent Directors (as
defined in Section 2.11 below), or (ii) 50% or less of the combined voting
power of the surviving corporation's then outstanding securities ordinarily
having the right to vote at elections of directors (regardless of any
approval by the Incumbent Directors); or

(e) the Incumbent Directors cease for any reason to constitute at
least a majority of the Board.

2.5 "Code" means the Internal Revenue Code of 1986, as in effect at the
time of reference, or any successor revenue code which may hereafter be adopted
in lieu thereof, and reference to any specific
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provisions of the Code shall refer to the corresponding provisions of the Code
as it may hereafter be amended or replaced.

2.6 "Committee" means the Committee of the Board or any other committee
appointed by the Board which is invested by the Board with responsibility for
the administration of the Plan and whose members meet the requirements for
eligibility to serve as set forth in the Plan.

2.7 "Company" means Eltrax Systems, Inc.

2.8 "Eligible Compensation" means the regular compensation (i.e., straight
time earnings), bonuses and commissions earned by an Employee during a payroll
period, before deductions or withholdings, but shall exclude, unless the
Committee determines otherwise, all other amounts, including, but not limited
to, (i) all amounts contributed by the Company or any Subsidiary under any
profit-sharing, pension, retirement, group insurance or other employee welfare
benefit plan or trust whether now in existence or hereinafter adopted and (ii)
any income from stock option exercises or other equity based compensation.

2.9 "Exchange Act" means the Securities Exchange Act of 1934, as in effect
at the time of reference, or any successor law which may hereafter be adopted in
lieu thereof, and any reference to any specific provisions of the Exchange Act
as it may hereafter be amended or replaced.

2.10 "Employees" means persons employed by the Company or any of its
Subsidiaries set forth in Schedule A attached hereto (as may be amended from
time to time by the Board of Directors in its sole discretion); provided,
however, that no person shall be considered an Employee unless he has been
employed for at least fifteen (15) consecutive days as of the Offering
Commencement Date of any such offering.

2.11 "Fair Market Value" means, with respect to the Shares, as of any date
(or, if no shares were traded or quoted on such date, as of the next preceding
date on which there was such a trade or quote) (a) the average of the reported
high and low sale prices of the Shares if the common stock is listed, admitted
to unlisted trading privileges or reported on any national securities exchange
or on the Nasdaq National Market, the closing bid price as reported by the
Nasdaq SmallCap Market, OTC Bulletin Board or the National Quotation Bureau,
Inc. or other comparable service; or (c) if the common stock is not so listed or
reported, such price as the Committee determines in good faith in the exercise
of its reasonable discretion. If determined by the Committee, such determination
will be final, conclusive and binding for all purposes and on all persons,
including, without limitation, the Company, the shareholders of the Company, the
Employees and their respective successors-in-interest. No member of the
Committee will be liable for any determination regarding the fair market value
of the Shares that is made in good faith.

2.12 "Incumbent Directors" means any individuals who are members of the
Board on the effective date of the Plan and any individual who subsequently
becomes a member of the Board whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority of the
Incumbent Directors (either by specific vote or by approval of the Company's
proxy statement in which such individual is named as a nominee for director
without objection to such nomination).

2.13 "Offering Commencement Date" means January 1 or July 1, as the case
may be, or any other date determined by the Committee, on which a particular
offering begins.

2.14 "Offering Termination Date" means the June 30 or December 31, as the
case may be, or any other date determined by the Committee, on which a
particular offering terminates.

2.15 "Option" means the right granted to an Employee to purchase Shares
pursuant to an offering made under the Plan and pursuant to such Employee's
election to purchase Shares in such offering, at a price, and subject to such
limitations and restrictions as the Plan and the Committee may impose.

2.16 "Parent" means any corporation, other than the employer corporation,
in an unbroken chain of corporations ending with the employer corporation if
each of the corporations other than the employer corporation owns stock
possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.

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2.17 "Plan" means the Eltrax Systems, Inc. 1999 Employee Stock Purchase
Plan.

2.18 "Purchase Period" means the period commencing on the Offering
Commencement Date and ending on the Offering Termination Date during which
installment payments for Shares purchased pursuant to Options granted pursuant
to an offering made under the Plan shall be made.

2.19 "Shares" means shares of the Company's common stock, par value $.01
per share, or, if by reason of the adjustment provisions contained herein, any
rights under the Plan pertaining to any other security, such other security.

2.20 "Subsidiary" or "Subsidiaries" means any corporation or corporations
other than the employer corporation in an unbroken chain of corporations
beginning with the employer corporation if each of the corporations other than
the last corporation in the unbroken chain owns stock possessing fifty percent
(50%) or more of the total combined voting power of all classes of stock in one
of the other corporations in such chain.

2.21 "Successor" means the legal representative of the estate of a
deceased Employee or the person or persons who shall acquire the right to
exercise or receive an Option by bequest or inheritance or by reason of the
death of the Employee.

3. STOCK SUBJECT TO THE PLAN. There will be reserved for use, upon the
exercise of Options to be granted from time to time pursuant to offerings made
under the Plan, an aggregate of 1,000,000 Shares, which Shares may be, in whole
or in part, as the Board shall from time to time determine, authorized but
unissued Shares, or issued Shares which shall have been reacquired by the
Company. The number of Shares reserved under the Plan may be issued pursuant to
the exercise of Options granted pursuant to one or more offerings made under the
Plan. Any Shares subject to issuance upon exercise of Options but which are not
issued because of a surrender, lapse, expiration or termination of any such
Option prior to issuance of the Shares shall once again be available for
issuance in satisfaction of Options.

4. ADMINISTRATION OF THE PLAN. The Board shall appoint the Committee to
administer the Plan. Subject to the provisions of the Plan, the Committee shall
have full authority, in its discretion, to determine when offerings will be made
under the Plan, the number of Shares available for purchase in any such
offering, and the terms and conditions of any such offering; to amend or cancel
Options (subject to Section 23 of the Plan); to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to the Plan; and
generally to interpret and determine any and all matters whatsoever relating to
the administration of the Plan, including the designation of individuals
responsible for the day-to-day operation of the Plan. All decisions,
determinations and interpretations made by the Committee shall be binding and
conclusive on all participants in the Plan and on their legal representatives,
heirs and beneficiaries. The Board may from time to time appoint members to the
Committee in substitution for or in addition to members previously appointed and
may fill vacancies, however caused, in the Committee. No Member of the Committee
shall be liable, in the absence of bad faith, for any act or omission with
respect to his service on the Committee.

5. OFFERINGS. Unless the Committee, in its discretion, determines
otherwise, the Plan will be implemented by up to twenty (20) consecutive six (6)
month offerings. The first offering under the Plan shall commence on January 1,
2000 and terminate on June 30, 2000. Thereafter, offerings shall commence on
each subsequent July 1 and January 1 and terminate on the following December 31
and June 30, respectively, of such year until the Plan is terminated or no
additional Shares are available for purchase under the Plan.

6. ELIGIBILITY TO PARTICIPATE IN OFFERINGS. All Employees shall be eligible
to participate in the Plan.

7. PARTICIPATION. An eligible Employee may become a participant in the Plan
by completing, signing and submitting an enrollment form ("Enrollment Form")
which shall designate a whole percentage of his Eligible Compensation, not to
exceed ten percent (10%), to be withheld during the Purchase Period of any
offering in which he participates, and any other necessary papers, including,
but not limited to, any forms required to establish a brokerage account at a
brokerage firm designated by the Committee in the
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Employee's name for the purpose of holding any Shares purchased pursuant to the
Plan, with such person as the Committee may designate at least ten (10) days
prior to the Offering Commencement Date of the first offering in which he wishes
to participate. After completing, signing and submitting an Enrollment Form and
any other necessary papers in accordance with the preceding sentence, an
Employee shall be deemed to have become a participant in the Plan for each
subsequent offering until the Employee withdraws from the Plan in accordance
with Section 14 hereof, is deemed to have withdrawn from the Plan in accordance
with Section 17 hereof, or otherwise gives written notice of his intent to
withdraw to such person as the Committee may designate. Except as otherwise
provided in Section 14, if an Employee who withdraws from the Plan desires to
re-enter the Plan, he must submit a new Enrollment Form in accordance with this
Section 7 at least ten (10) days prior to the Offering Commencement Date of the
particular offering to which such re-entry is intended to apply, or by such
other time as the Committee determines in its sole discretion. An Employee's
re-entry into the Plan cannot become effective before the beginning of the next
offering following his withdrawal. Participation in one offering under the Plan
shall neither limit nor require participation in any other offering.

8. GRANT OF OPTIONS. Subject to the limitations set forth in Sections 6 and
9 of the Plan, on the Offering Commencement Date of each offering made under the
Plan, each Employee who has previously elected to participate in the Plan shall
automatically be granted an Option for as many full Shares as he will be able to
purchase with the payroll deductions credited to his Account during the Purchase
Period of that offering. In the event the total maximum number of Shares
resulting from all elections to purchase under any offering of Shares made under
the Plan exceeds the number of Shares offered, the Company reserves the right to
reduce the maximum number of Shares which Employees may purchase pursuant to
their elections to purchase, to allot the Shares available in such manner as it
shall determine (subject to the requirements of Section 423 of the Code), but
generally pro rata to subscriptions received, and to grant Options to purchase
only for such reduced number of Shares. Notice of any such reduction shall be
given to each participating Employee, in a uniform and nondiscriminatory manner
determined by the Committee in its sole discretion. In the event an Employee's
election to purchase Shares pursuant to an offering made under the Plan is
canceled pursuant to Section 9 of the Plan, the Option granted to such Employee
shall automatically terminate and the balance in his Account shall be returned
to the Employee.

9. LIMITATIONS OF NUMBER OF SHARES WHICH MAY BE PURCHASED. The following
limitations shall apply with respect to the number of Shares which may be
purchased by each Employee who elects to participate in an offering made under
the Plan:

(a) No Employee may purchase, or elect to purchase Shares during any one
offering pursuant to the Plan for an aggregate purchase price in excess of ten
percent (10%) of his Eligible Compensation during the Purchase Period applicable
to such offering.

(b) No Employee shall be granted an Option to purchase Shares under the
Plan if such Employee immediately after such Option is granted, owns stock
(within the meaning of Section 424(d) of the Code, and including stock subject
to purchase under any outstanding options) possessing five percent (5%) or more
of the total combined voting power or value of all classes of stock of the
Company or, if applicable, any Subsidiary or, if applicable, a Parent.

(c) No Employee shall be granted an Option to purchase Shares which permits
his right to purchase stock under the Plan and all other employee stock purchase
plans of the Company and, if applicable, a Subsidiary, and, if applicable, a
Parent, to accrue (as determined under Section 423(b)(8) of the Code) at a rate
which exceeds ($25,000) of fair market value of such stock (determined on the
date the Option to purchase is granted) for each calendar year in which such
Option is outstanding at any time.

10. EXERCISE PRICE. Unless the Committee, in its discretion, determines to
set a higher per Share exercise price, the per Share exercise price for Shares
subject to purchase under Options granted pursuant to an offering made under the
Plan shall be an amount equal to the lesser of (a) eighty-five percent (85%) of
the Fair Market Value of Shares on the Offering Commencement Date, or (b)
eighty-five percent (85%) of the Fair Market Value of the Shares on the Offering
Termination Date.

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11. PAYROLL DEDUCTIONS. Payment of the exercise price of any Option granted
pursuant to the Plan shall be made in installments through payroll deductions,
with no right of prepayment. Each Employee electing to participate in an
offering of Shares made under the Plan shall authorize the Company pursuant to
Section 7 of the Plan to withhold a designated amount from his regular weekly,
bi-weekly, semimonthly or monthly pay for each payroll period during the
Purchase Period, which amount, expressed as a percentage, may not exceed ten
percent (10%) of his Eligible Compensation (or such other percentage as
determined by the Committee in its sole discretion). All such payroll deductions
made for an Employee shall be credited to his Account. An Employee may not make
any separate cash payments into his Account nor may payment for Shares be made
other than by payroll deduction. No interest shall accrue on the amounts
credited to an Employee's Account pursuant to this Section 11.

12. EXERCISE OF OPTIONS. As of the close of business on the Offering
Termination Date of any offering of Shares made under the Plan, each outstanding
Option shall automatically be exercised. Subject to the limitations in Sections
6, 8 and 9 of the Plan upon the exercise of an Option, the aggregate amount of
the payroll deductions credited to the Account of each Employee as of that date
will automatically be applied to the exercise price for the purchase of that
number of Shares, rounded to the nearest whole share, equal to the Account
balance divided by the exercise price. Promptly following the end of each
Offering Termination Date, the number of Shares purchased by each Employee shall
be deposited into an account established in the Employee's name at a stock
brokerage or other financial services firm designated by the Company. Unless an
Employee notifies the Company in writing not to carry over the balance of his
Account (representing fractional Shares) to the next offering and to have the
balance of his Account returned to him, the Company shall carry over the balance
of his Account to the next offering. Upon termination of the Plan, the balance
of each Employee's Account shall be returned to him.

13. RIGHTS OF A SHAREHOLDER. An Employee will become a shareholder of the
Company with respect to Shares for which payment has been received at the close
of business on the Offering Termination Date. An Employee will have no rights as
a shareholder with respect to Shares under an election to purchase Shares until
he has become a shareholder as provided above.

14. CANCELLATION OF ELECTION TO PURCHASE. An Employee who has elected to
purchase Shares pursuant to any offering made under the Plan may cancel his
election in its entirety. Any such cancellation shall be effective upon the
delivery by the Employee of written notice of cancellation to such person as the
Committee may designate. Such notice of cancellation must be so delivered before
the close of business on the third to last business day of the Purchase Period.
The amount credited to an Employee's Account at the time the cancellation
becomes effective may be, at the Employee's option, (i) applied to the purchase
of the number of Shares such amount will then purchase or (ii) returned to the
Employee. If the Employee elects to purchase Shares with the amount credited to
his Account at the time of cancellation, such purchase will become effective at
the close of business on the Offering Termination Date. Upon cancellation, the
Employee shall be deemed to have withdrawn from the Plan. To re-enter the Plan,
the Employee must submit a new Enrollment Form in accordance with Section 7.

15. LEAVE OF ABSENCE OR LAYOFF. An Employee purchasing Shares under the
Plan who is granted a leave of absence (including a military leave) or is laid
off during the Purchase Period may at that time elect to suspend payments during
such leave of absence or period of layoff. Any such suspension shall be treated
as a partial cancellation of his election to purchase Shares. If the Employee
does not return to active service within ninety (90) days from the date of his
leave of absence or layoff, unless his rehire is guaranteed, his election to
purchase shall be deemed to have been canceled at that time, and the Employees
only right will be to receive in cash the amount credited to his Account.

16. EFFECT OF FAILURE TO MAKE PAYMENTS WHEN DUE. If in any payroll period
an Employee who has filed an election to purchase Shares under the Plan has no
pay or his pay is insufficient (after other authorized deductions) in any
payroll period to permit deduction of his installment payment, the amount of
such deficiency shall be treated as a partial cancellation of his election to
purchase Shares.

17. TERMINATION OF EMPLOYMENT. If an Employee's employment is terminated
for any reason, excluding death, prior to the end of the Purchase Period of any
offering, the Employee's rights under the
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Plan will terminate at such time. A notice to withdraw from the Plan will be
considered as having been received from the Employee on the day his employment
ceases, and the only right of the Employee will be to receive the cash then
credited to his Account. If an Employee dies prior to the end of the Purchase
Period of any offering, the amount credited to such Employee's Account at the
time of his death may, at the option of the Employee's estate, heirs,
beneficiaries or other authorized person, be (i) applied to the purchase of the
number of Shares such amount will then purchase or (ii) paid to the estate,
heirs, beneficiaries or other authorized person. If the Employee's estate,
heirs, beneficiaries or other authorized person elects to purchase Shares with
the amount credited to the Employee's Account at the time of death, such
purchase will become effective at the close of business on the Offering
Termination Date.

18. NONTRANSFERABILITY OF OPTIONS. An Option, or an Employee's right to any
amounts held for his Account under the Plan, shall not be transferable, other
than (a) by will or the laws of descent and distribution, and an Option may be
exercised, during the lifetime of the holder of the Option, only by the holder
or in the event of death, the holder's Successor or (b) if permitted pursuant to
the Code and the Regulations thereunder without affecting the Options
qualification under Section 423 of the Code, pursuant to a qualified domestic
relations order.

19. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. In the event of changes in
all of the outstanding Shares by reason of stock dividends, stock splits,
recapitalizations, mergers, consolidations, combinations, or exchanges of
shares, separations, reorganizations or liquidations, or similar events, or in
the event of extraordinary cash or non-cash dividends being declared with
respect to the Shares, or similar transactions or events, the number and class
of Shares available under the Plan in the aggregate, the number and class of
Shares subject to Options theretofore granted, applicable purchase prices and
all other applicable provisions, shall, subject to the provisions of the Plan,
be equitably adjusted by the Committee, taking into account Section 424(a) of
the Code. The foregoing adjustment and the manner of application of the
foregoing provisions shall be determined by the Committee in its sole
discretion. Any such adjustment may provide for the elimination of any
fractional Share which might otherwise become subject to an Option.

20. CHANGE IN CONTROL. Notwithstanding anything to the contrary herein, in
the case of a Change in Control of the Company, the Board may, in its sole
discretion, elect to terminate the Purchase Period of any offering then in
effect as of the date of such Change of Control (or such other date in the
discretion of the Committee), with the effect that such day will be the Offering
Termination Date of such offering.

21. TAXES. The Employee, or his Successor, shall promptly notify the
Company of any disposition of Shares acquired pursuant to the exercise of an
Option under the Plan and the Company shall have the right to deduct any taxes
required by law to be withheld as a result of such disposition from any amounts
otherwise payable then or at any time thereafter to the Employee. The Company
shall also have the right to require a person entitled to receive Shares
pursuant to the exercise of an Option to Pay the Company the amount of any taxes
which the Company is or will be required to withhold with respect to the Shares
before the certificate for such Shares is delivered pursuant to the Option.

22. TERMINATION OF THE PLAN. The Plan shall terminate ten (10) years from
the date the Plan becomes effective, and an Option shall not be granted under
the Plan after that date although the terms of any Options may be amended at any
date prior to the end of its term in accordance with the Plan. Any Options
outstanding at the time of termination of the Plan shall continue in full force
and effect according to the terms and conditions of the Option and this Plan.

23. AMENDMENT OF THE PLAN. The Plan may be amended at any time and from
time to time by the Board, but no amendment without the approval of the
shareholders of the Company shall be made if shareholder approval under Section
423 of the Code would be required. Notwithstanding the discretionary authority
granted to the Committee in Section 4 of the Plan, no amendment of the Plan or
any Option granted under the Plan shall impair any of the rights of any holder,
without the holder's consent, under any Option theretofore granted under the
Plan.

24. CONDITIONS UPON ISSUANCE OF SHARES. Shares shall not be issued with
respect to an Option unless the exercise of such Option and the issuance and
delivery of such Shares pursuant thereto shall comply

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with all applicable provisions of law, domestic or foreign, including, without
limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules
and regulations promulgated thereunder, and the requirements of any stock
exchange upon which the Shares may then be listed, and shall be further subject
to the approval of counsel for the Company with respect to such compliance.

25. FEES AND COSTS. The Company shall pay all fees and expenses necessarily
incurred by the Company in connection with operation of the Plan.

26. NO CONTRACT OF EMPLOYMENT. Neither the adoption of this Plan nor the
grant of any Option shall be deemed to obligate the Company or any Subsidiary to
continue the employment of any Employee.

27. EFFECTIVENESS OF THE PLAN. The Plan shall become effective on November
16, 1999. Notwithstanding the foregoing, unless the Plan is approved by the
Company's shareholders at a meeting duly held in accordance with Minnesota law
within twelve (12) months after being adopted by the Board, the Plan and all
Options made under it shall be void and of no force and effect.

28. OTHER PROVISIONS. As used in the Plan, and in other documents prepared
in implementation of the Plan, references to the masculine pronoun shall be
deemed to refer to the masculine, feminine or neuter, and references in the
singular or the plural shall refer to the plural or the singular, as the
identity of the person or persons or entity or entities being referred to may
require. The captions used in the Plan and in such other documents prepared in
implementation of the Plan are for convenience only and shall not affect the
meaning of any provision hereof or thereof.

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SCHEDULE A

The Eltrax Systems, Inc. 1999 Employee Stock Purchase Plan applies to these
companies:

- Eltrax Systems, Inc.

- Sulcus Hospitality Technologies, Inc.

- Encore Systems, Inc.

- Five Star Systems, Inc.

- GSSS, Inc.

- Nordata, Inc.

- Windward Technology, Inc.

- Sulcus Investment Corp.

- Sulcus Hospitality Group, Inc.

- Radix Systems, Inc.

- Lodgistix, Inc.

- Squirrel Companies, Inc.

- Squirrel Systems of Canada, Ltd.

- NRG Management Systems, Inc.

- Senercomm, Inc.

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Article V of Eltrax's Amended and Restated Articles of Incorporation limits
the liability of its directors to the fullest extent permitted by the Minnesota
Business Corporation Act. Specifically, directors of Eltrax will not be
personally liable for monetary damages for breach of fiduciary duty as
directors, except liability for (i) any breach of the duty of loyalty to Eltrax
or its stockholders, (ii) acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law, (iii) dividends or other
distributions of corporate assets that are in contravention of certain statutory
or contractual restrictions, (iv) violations of certain Minnesota securities
laws, or (v) any transaction from which the director derives an improper
personal benefit.

Article IV of Eltrax's Amended and Restated Articles of Incorporation gives
Eltrax the power and authority to provide indemnification to officers,
directors, employees and agents of Eltrax to the fullest extent permissible
under the Minnesota Business Corporation Act. Section 302A.521 of the Minnesota
Business Corporation Act requires that Eltrax indemnify any director, officer or
employee made or threatened to be made a party to a proceeding, by reason of the
former or present official capacity of the person, against judgments, penalties,
fines, settlements and reasonable expenses incurred in connection with the
proceeding if certain statutory standards are met. "Proceeding" means a
threatened, pending or completed civil, criminal, administrative, arbitration or
investigative proceeding, including a derivative action in the name of Eltrax.
Reference is made to the detailed terms of Section 302A.521 of the Minnesota
Business Corporation Act for a complete statement of such indemnification
rights.

Article VII of Eltrax's Restated Bylaws provides that Eltrax shall
indemnify such persons, for such expenses and liabilities, in such manner, under
such circumstances, and to such extent, as permitted by the Minnesota Business
Corporation Act, as now enacted or hereafter amended, provided that a
determination is made in each case, in the manner required by such statute, that
the person seeking indemnification is eligible therefor.

Eltrax maintains directors' and officers' liability insurance, including a
reimbursement policy in favor of Eltrax.

ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibits.

See Exhibit Index.

(b) Financial Statement Schedules.

Schedules are omitted because they either are not required or are not
applicable or because equivalent information has been included in the financial
statements, the notes thereto or elsewhere herein.

The information provided pursuant to Item 4(b) of Form S-4 is furnished as
Appendices B and C of the proxy.

ITEM 22. UNDERTAKINGS

(a) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling the
registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred by a

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director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

(b) (1) The undersigned registrant hereby undertakes as follows: that prior
to any public reoffering of the securities registered hereunder through use of a
prospectus which is a part of this registration statement, by any person or
party who is deemed to be an underwriter within the meaning of Rule 145(c), the
issuer undertakes that such reoffering prospectus will contain the information
called for by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.

(2) The undersigned registrant undertakes that every prospectus: (A) that
is filed pursuant to paragraph (1) immediately preceding, or (B) that purports
to meet the requirements of Section 10(a)(3) of the Securities Act and is used
in connection with an offering of securities subject to Rule 415, will be filed
as a part of an amendment to the registration statement and will not be used
until such amendment is effective, and that, for purposes of determining any
liability under the Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

(c) The undersigned registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Items 4, 10(b), 11 or 13 of this Form within one business day of receipt of such
request, and to send the incorporated documents by first class mail or other
equally prompt means. This includes information contained in documents filed
subsequent to the effective date of the registration statement through the date
of responding to the request.

(d) The undersigned registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-4 and has duly caused this Amendment No. 1 to
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Southfield, State of Michigan, on August 29,
2000.

ELTRAX SYSTEMS, INC.,
a Minnesota corporation

By: /s/ WILLIAM P. O'REILLY
----------------------------------
William P. O'Reilly
President and Chief Executive
Officer

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.

<TABLE>
<CAPTION>
NAME TITLE DATE
---- ----- ----
<C> <S> <C>

/s/ WILLIAM P. O'REILLY Chairman of the Board, August 29, 2000
----------------------------------------------------- President and Chief Executive
William P. O'Reilly Officer

* Director August 29, 2000
-----------------------------------------------------
William G. Taylor

* Director August 29, 2000
-----------------------------------------------------
Patrick J. Dirk

* Director August 29, 2000
-----------------------------------------------------
Stephen E. Raville

* Director August 29, 2000
-----------------------------------------------------
James C. Barnard

/s/ WILLIAM A. FIELDER III Chief Financial Officer, August 29, 2000
----------------------------------------------------- Secretary and Treasurer
William A. Fielder III (principal accounting and
financial officer)

*/s/ WILLIAM A. FIELDER III
-----------------------------------------------------
William A. Fielder III
by William A. Fielder III
as attorney-in-fact
</TABLE>

II-3
<PAGE> 217

EXHIBIT INDEX

<TABLE>
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ITEM ITEM METHOD OF FILING
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2.1 Second Amended and Restated Agreement and Included as Appendix A to the proxy
Plan of Merger dated as of July 27, 2000 statement/prospectus.
among Eltrax, Solemn and Cereus
2.2 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
May 14, 1996 among Eltrax, Rudata to Eltrax's Current Report on Form 8-K
Acquisition Corporation, Nordata filed June 3, 1996.
Acquisition Corporation, Rudata, Inc.,
Nordata, Inc. and Howard B. and Ruby Lee
Norton, as amended pursuant to that First
Amendment to Agreement and Plan of Merger
dated as of May 17, 1996 among the same
parties.
2.3 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
October 31, 1996 among Eltrax, ANS to Eltrax's Current Report on Form 8-K
Acquisition Corporation, Atlantic Network filed November 12, 1996.
Systems, Inc. and Walter C. Lovett,
Douglas L. Roberson and B. Taylor Koonce.
2.4 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
May 14, 1997 among Eltrax, EJG Techline to Eltrax's Current Report on Form 8-K
Acquiring Corporation, EJG Techline filed May 14, 1997.
Incorporated and Edward J. and Kathleen
M. Gorlitz and Colin E. and Diane C.
Quinn.
2.5 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
July 1, 1997 among Eltrax, Four Corners to Eltrax's Current Report on Form 8-K
Acquiring Corporation, Four Corners filed July 1, 1997.
Technology, Inc. and Robert A. Hughes,
Joel J. Blickenstaff and David Noall.
2.6 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
August 15, 1997 among Eltrax, Hi-Tech to Eltrax's Current Report on Form 8-K
Acquiring Corporation, Hi-Tech filed August 15, 1997.
Connections, Inc. and Edward C. Barrett,
Daniel M. Christy, David R. Hurlbrink,
David R. Spatz, Raymond H. Melcher and
Timothy E. Devlin.
2.7 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
October 31, 1997 among Eltrax, DataComm to Eltrax's Current Report on Form 8-K
Acquiring Corporation, Midwest Acquiring filed October 3, 1997.
Corporation, DataCom Associates, Inc.,
Midwest Telecom Associates, Inc. and John
M. Good, and Harold Madison.
2.8 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
August 31, 1998 among Eltrax, Encore to Eltrax's Current Report on Form 8-K
Acquiring Corporation, Encore Systems, filed September 10, 1998.
Inc., Global Systems and Support, Inc.,
Five Star Systems, Inc., Penelope A.
Sellers, and Joseph T. Dyer.
</TABLE>
<PAGE> 218

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ITEM ITEM METHOD OF FILING
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2.9 Agreement and Plan of Merger dated as of Incorporated by reference to Exhibit 2.1
November 11, 1998 among Eltrax, Sulcus to Eltrax's Registration Statement on
Hospitality Technologies Corp. and Sulcus Form S-4 filed February 16, 1999 (File
Acquiring Corporation. No. 333-68699).
3.1 Amended and Restated Articles of Incorporated by reference to Exhibit 3.1
Incorporation of Eltrax, as amended. to Eltrax's Registration Statement on
Form S-18 (File No. 33-51456).
3.2 Bylaws of Eltrax, as amended. Filed herewith.
4.1 Specimen form of Eltrax's common stock Incorporated by reference to Exhibit 4.1
certificate. to Eltrax's Registration Statement on
Form S-18 (File No. 33-51456).
4.2 Warrant, dated as of October 31, 1996, to Incorporated by reference to Exhibit 10.4
purchase 106,250 shares of Eltrax common to Eltrax's Current Report on Form 8-K
stock granted to Walter C. Lovett. filed November 12, 1996.
4.3 Warrant, dated as of October 31, 1996, to Incorporated by reference to Exhibit 10.5
purchase 106,250 shares of Eltrax common to Eltrax's Current Report on Form 8-K
stock granted to Douglas L. Roberson. filed November 12, 1996.
4.4 Warrant dated as of September 23, 1997 to Incorporated by reference to Exhibit 4.5
purchase 240,000 shares of Eltrax common to Eltrax's Annual Report on Form 10-KSB
stock granted to Morgan Q. Payne. for the year ended December 31, 1997.
4.5 Convertible Debenture dated July 27, 2000 Previously filed.
executed by Eltrax in favor of Strong
River Investments, Inc.
4.6 Convertible Debenture dated July 27, 2000 Previously filed.
executed by Eltrax in favor of Bay Harbor
Investments, Inc.
4.7 Registration Rights Agreement dated July Previously filed.
27, 2000, among Eltrax, Strong River
Investments, Inc. and Bay Harbor
Investments, Inc.
4.8 Registration Rights Agreement dated June Previously filed.
29, 2000 between Eltrax and E.piphany,
Inc.
4.9 Amended and Restated Registration Rights Previously filed.
Agreement dated June 23, 2000 between
Eltrax and Cereus.
4.10 Warrant dated as of July 27, 2000 to Previously filed.
purchase 104,168 shares of Eltrax common
stock granted to Strong River
Investments, Inc.
4.11 Warrant dated as of July 27, 2000 to Previously filed.
purchase 104,168 shares of Eltrax common
stock granted to Bay Harbor Investments,
Inc.
4.12 Warrant dated as of July 27, 2000 to Previously filed.
purchase 26,041 shares of Eltrax common
stock granted to Strong River
Investments, Inc.
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ITEM ITEM METHOD OF FILING
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4.13 Warrant dated as of July 27, 2000 to Previously filed.
purchase 26,041 shares of Eltrax common
stock granted to Bay Harbor Investments,
Inc.
4.14 Warrant dated as of July 27, 2000 to Previously filed.
purchase 52,083 shares of Eltrax common
stock granted to Strong River
Investments, Inc.
4.15 Warrant dated as of July 27, 2000 to Previously filed.
purchase 52,083 shares of Eltrax common
stock granted to Bay Harbor Investments,
Inc.
5.1 Opinion of Jaffe, Raitt, Heuer & Weiss, Filed herewith.
Professional Corporation, regarding
legality of securities being registered.
8.1 Opinion of Rogers & Hardin LLP regarding Filed herewith.
tax matters.
10.1 Form of Incentive Stock Option Agreement. Incorporated by reference to Exhibit 10.6
to Eltrax's Registration Statement on
Form S-18 (File No. 33-51456).
10.2 Form of Non-Statutory Option Agreement. Incorporated by reference to Exhibit 10.7
to Eltrax's Registration Statement on
Form S-18 (File 33-51455).
10.3 Form of Non-Employee Director Stock Incorporated by reference to Exhibit
Option Agreement. 10.10 to Eltrax's Annual Report on Form
10-KSB for the year ended March 31, 1993.
10.4 1992 Stock Incentive Plan. Incorporated by reference to Exhibit 10.4
to Eltrax's Registration Statement on
Form S-18 (File No. 33-51456).
10.5 1995 Stock Incentive Plan. Incorporated by reference to Exhibit
10.12 to Eltrax's Annual Report on Form
10-KSB for the year ended March 31, 1995.
10.6 1997 Stock Incentive Plan. Incorporated by reference to Eltrax's
Proxy Statement for its 1997 Annual
Meeting of Stockholders.
10.7 1998 Stock Incentive Plan. Incorporated by reference to Exhibit
10.27 to Eltrax's Registration Statement
on Form S-4 filed February 16, 1999 (File
No. 333-68699).
10.8 Eltrax Systems, Inc. 1999 Stock Incentive Incorporated by reference to Exhibit 4.4
Plan. to Eltrax's Registration Statement on
Form S-8 filed August 13, 1999.
10.9 First Amendment to Eltrax Systems, Inc. Previously filed.
1999 Stock Incentive Plan.
10.10 Agreement dated as of October 31, 1996 Incorporated by reference to Exhibit 10.7
among Eltrax, William P. O'Reilly, Clunet to Eltrax's Current Report on Form 8-K
R. Lewis, Mack V. Traynor, III and Walter filed November 12, 1996.
C. Lovett, Douglas L. Roberson and B.
Taylor Koonce.
10.11 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.2
dated as of May 14, 1997 between Eltrax to Eltrax's Current Report on Form 8-K
and Edward J. Gorlitz. filed May 15, 1997.
</TABLE>

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ITEM ITEM METHOD OF FILING
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<C> <S> <C>
10.12 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.1
dated as of May 14, 1997 between Eltrax to Eltrax's Current Report on Form 8-K
and Colin E. Quinn. filed May 15, 1997.
10.13 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.2
dated as of July 1, 1997 between Eltrax to Eltrax's Current Report on Form 8-K
and Joel J. Blickenstaff. filed July 1, 1997.
10.14 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.1
dated as of July 1, 1997 between Eltrax to Eltrax's Current Report on Form 8-K
and Robert A. Hughes. filed July 1, 1997.
10.15 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.1
dated as of August 15, 1997 between to Eltrax's Current Report on Form 8-K
Eltrax and Edward C. Barrett. filed August 15, 1997.
10.16 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.1
dated as of August 15, 1997 between to Eltrax's Current Report on Form 8-K
Eltrax and Daniel M. Christy. filed August 15, 1997.
10.17 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.3
dated as of August 15, 1997 between to Eltrax's Current Report on Form 8-K
Eltrax and David R. Hurlbrink. filed August 15, 1997.
10.18 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.1
dated as of October 31, 1997 between to Eltrax's Current Report on Form 8-K
Eltrax and John M. Good. filed October 3, 1997.
10.19 Employment and Noncompetition Agreement Incorporated by reference to Exhibit 10.1
dated as of August 31, 1998 between to Eltrax's Current Report on Form 8-K
Eltrax and Penelope A. Sellers. filed September 10, 1998.
10.20 Consulting Agreement dated as of April 1, Incorporated by reference to Exhibit
1999 between Eltrax and Montana Corp. 10.18 to Eltrax's Annual Report on Form
10-K filed March 27, 2000.
10.21 Consulting Agreement dated as of April 1, Incorporated by reference to Exhibit
1999 between Eltrax and CRL Enterprises. 10.19 to Eltrax's Annual Report on Form
10-K filed March 27, 2000.
10.22 Credit Agreement dated September 11, 1998 Incorporated by reference to Exhibit 10.2
between Eltrax, its subsidiaries and to Eltrax's Current Report on Form 8-K
State Street Bank and Trust Company. filed September 10, 1998.
10.23 Asset Purchase Agreement dated as of Incorporated by reference to Exhibit 99.1
January 29, 1997 between Atlantic Network to Eltrax's Current Report on Form 8-K
Systems, Inc. and MRK Technologies, LTD. filed February 12, 1997.
10.24 Real Estate Lease dated June 1, 1996 Incorporated by reference to Exhibit
between Walt Lovett, Doug and Lisa 10.11 to Eltrax's Annual Report on Form
Roberson and Atlantic Network Systems, 10-KSB for the nine month transition
Inc. period ended December 31, 1996.
10.25 Lease Agreement between Burgoe/ Incorporated by reference to Exhibit
Wyomissing Partners and Hi-Tech 10.30 to Eltrax's Annual Report on Form
Connections, Inc. dated September 15, 10-KSB for the year ended December 31,
1996. 1997.
10.26 Lease Agreement between JMG Development Incorporated by reference to Exhibit
Co. Ltd and DataComm Associates, Inc. 10.31 to Eltrax's Annual Report on Form
dated December 1, 1996. 10-KSB for the year ended December 31,
1997.
</TABLE>
<PAGE> 221

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ITEM ITEM METHOD OF FILING
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10.27 Lease Agreement between Werner Palmquist Incorporated by reference to Exhibit
Investments and Four Corners Technology, 10.32 to Eltrax's Annual Report on Form
Inc. dated February 21, 1996. 10-KSB for the year ended December 31,
1997.
10.28 Lease Agreement (as amended) between 900 Incorporated by reference to Exhibit
Corporation and Encore Systems, Inc. 10.28 to Eltrax's Registration Statement
originally dated January 21, 1996. on Form S-4 filed February 16, 1999 (File
No. 333-68699).
10.29 Amended and Restated Preferred Vendor Incorporated by reference to Exhibit
Arrangement, dated as of May 15, 1992 10.29 to Eltrax's Registration Statement
between Holiday Hospitality Corporation on Form S-4 filed February 16, 1999 (File
and Encore Systems, Inc. No. 333-68699).
10.30 Form of Consulting Agreement between Incorporated by reference to Exhibit
Eltrax and non employee Sulcus 10.34 to Eltrax's Registration Statement
Hospitality Technologies Corp. directors. on Form S-4 filed February 16, 1999 (File
No. 333-68699).
10.31 Form of Termination Agreement between Incorporated by reference to Exhibit
Leon Harris and Sulcus Hospitality 10.35 to Eltrax's Registration Statement
Technologies Corp. on Form S-4 filed February 16, 1999 (File
No. 333-68699).
10.32 Form of Agreement between Leon Harris and Incorporated by reference to Exhibit
Eltrax. 10.36 to Eltrax's Registration Statement
on Form S-4 filed February 16, 1999 (File
No. 333-68699).
10.33 Employment Agreement dated March 24, 1999 Incorporated by reference to Exhibit
between Eltrax and Don G. Hallacy. 10.31 to Eltrax's Annual Report on Form
10-K filed March 27, 2000.
10.34 Loan and Security Agreement dated as of Incorporated by reference to Exhibit
December 30, 1999 between Eltrax and 10.35 to Eltrax's Amendment to Annual
William P. O'Reilly. Report on Form 10-K/A filed April 28,
2000.
10.35 Revolving Credit Note dated as of Incorporated by reference to Exhibit
December 30, 1999 made by Eltrax in favor 10.36 to Eltrax's Amendment to Annual
of William P. O'Reilly in the amount of Report on Form 10-K/A filed April 28,
$1,000,000. 2000.
10.36 Revolving Credit and Security Agreement Incorporated by reference to Exhibit
among PNC Bank, National Association and 10.32 to Eltrax's Annual Report on Form
Eltrax and certain of its subsidiaries 10-K filed March 27, 2000.
dated March 14, 2000.
10.37 First Amendment to Revolving Credit and Previously filed.
Security Agreement by and among PNC Bank
and Eltrax and certain of its
subsidiaries dated May 15, 2000.
10.38 Second Amendment to Revolving Credit and Previously filed.
Security Agreement by and among PNC Bank
and Eltrax and certain of its
subsidiaries dated June 23, 2000.
10.39 Consent of PNC Bank, National Previously filed.
Association, dated July 27, 2000 with
respect to Revolving Credit and Security
Agreement dated March 14, 2000, as
amended.
10.40 Limited Guaranty Agreement between PNC Incorporated by reference to Exhibit
Bank, National Association and William P. 10.33 to Eltrax's Annual Report on Form
O'Reilly dated March 14, 2000 10-K filed March 27, 2000.
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ITEM ITEM METHOD OF FILING
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10.41 Pledge Agreement between PNC Bank, Incorporated by reference to Exhibit
National Association and William P. 10.34 to Eltrax's Annual Report on Form
O'Reilly dated March 14, 2000. 10-K filed March 27, 2000.
10.42 Eltrax Systems, Inc. 1999 Employee Stock Included as Appendix D to the proxy
Purchase Plan statement/prospectus.
10.43 Bridge Loan and Security Agreement dated Previously filed.
as of June 14, 2000, between Eltrax and
Cereus.
10.44 Amendment No. 1 to Bridge Loan and Previously filed.
Security Agreement dated as of June 14,
2000, between Eltrax and Cereus made as
of June 23, 2000.
10.45 Amended and Restated Non-Negotiable Previously filed.
Subordinated Convertible Promissory Note
dated June 23, 2000 between Eltrax as
maker and Cereus, as holder.
10.46 Subordination Agreement dated June 14, Previously filed.
2000 among Eltrax, Cereus and PNC Bank,
National Association.
10.47 First Amendment to Subordination Previously filed.
Agreement dated June 23, 2000 among
Eltrax, Cereus and PNC Bank
10.48 Continuing Guaranty Agreement dated June Previously filed.
14, 2000 by Solemn Acquisition
Corporation in favor of PNC Bank
10.49 Security Agreement dated June 14, 2000 by Previously filed.
Solemn Acquisition Corporation in favor
of PNC Bank
10.50 Stock Pledge Agreement dated June 14, Previously filed.
2000 by and between Eltrax and PNC Bank
10.51 Office Lease Agreement between Eltrax and Previously filed.
Galleria 400 LLC, dated September 20,
1999.
10.52 First Amendment to Office Lease Agreement Previously filed.
between Eltrax and Galleria 400 LLC,
dated March 31, 2000.
10.53 Convertible Debenture Purchase Agreement Previously filed.
dated July 27, 2000 among Eltrax, Strong
River Investments, Inc. and Bay Harbor
Investments, Inc.
10.54 Subscription Agreement dated June 29, Previously filed.
2000 between Eltrax and E.piphany, Inc.
10.55 Stockholders Proxy Agreement dated as of Previously filed.
June 12, 2000 among Cereus and Eltrax's
directors.
10.56 Stockholders Proxy Agreement dated as of Previously filed.
June 12, 2000 among Eltrax and Cereus's
directors.
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<TABLE>
<CAPTION>
ITEM ITEM METHOD OF FILING
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<C> <S> <C>
10.57 Subordination Agreement dated July 27, Previously filed.
2000 among Eltrax, Cereus, Strong River
Investments, Inc. and Bay Harbor
Investments, Inc.
21.1 Eltrax's subsidiaries. Previously filed.
23.1 Consent of PricewaterhouseCoopers LLP. Filed herewith.
23.2 Consent of Crowe, Chizek and Company LLP. Filed herewith.
23.3 Consent of KPMG, LLP. Filed herewith.
23.4 Consent of Moore Stephens Frost, PLC. Filed herewith.
23.5 Consent of the Robinson-Humphrey Company, Filed herewith.
LLC.
23.6 Consent of Morgan Keegan & Company, Inc. Included in Appendix B to the proxy
statement/prospectus.
23.7 Consent of Jaffe, Raitt, Heuer & Weiss, Previously filed.
Professional Corporation.
23.8 Consent of Rogers & Hardin LLP. Included in Exhibit 8.1 filed herewith.
99.1 Consents of Cereus's designees to Previously filed.
Eltrax's board of directors
99.2 Form of Eltrax's proxy card. Filed herewith.
99.3 Form of Cereus's proxy card. Filed herewith.
</TABLE>