----

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**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      DC 20549**

**FORM      10-Q**

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**FORTRESS      INTERNATIONAL GROUP, INC.**

| **Delaware**                                                                                |   | **20-2027651**                                      |
|---------------------------------------------------------------------------------------------|--------|-----------------------------------------------------|
| (State                or other jurisdiction ofincorporation                or organization) |   | (I.R.S.                Employer Identification No.) |
|                                                                                        |   |                                                |
| **9841                Broken Land Parkway****Columbia,                Maryland 21046**      |   | **21046**                                           |
| (Address                of principal executive offices)                                     |   | (Zip                Code)                           |

**(410)      312-9988 **

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**FORTRESS      INTERNATIONAL GROUP, INC.**

**Table      of Contents**

|                                                                                                                                                                                                                                                                                                                                           | **Page** |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------|
| **PART                I - FINANCIAL INFORMATION**                                                                                                                                                                                                                                                                                              |
|  **Item                1.     Financial                Statements**                                                                                                                                                                                                                                              |     |
| Consolidated                Balance Sheets as of March 31, 2007 (unaudited) and as of December                31,                2006 (successor) and as of January 19, 2007 (unaudited) and December                31,                2006 (predecessor)                                                                                     | 1        |
|  Consolidated                Statements of Operations (unaudited) for the three months ended March                31,                2007 and March 31, 2006 (successor) and for the period from January                1,                2007 to January 19, 2007 and the three months ended March 31, 2006                (predecessor) | 3        |
|  Consolidated                Statements of Cash Flows (unaudited) for the three months ended March                31,                2007 and March 31, 2006 (successor) and for the period from January                1,                2007 to January 19, 2007 and the three months ended March 31, 2006                (predecessor) | 4        |
|     Notes                to Consolidated Financial Statements                                                                                                                                                                                                                                                              | 5        |
|  **Item                2.      Management’s Discussion and Analysis of                Financial Condition and Results of Operations**                                                                                                                                                                      | 12       |
|  **Item                3.      Quantitative and Qualitative Disclosures                about Market Risk**                                                                                                                                                                                                       | 18       |
|  **Item                4.      Controls and                Procedures**                                                                                                                                                                                                                                          | 19       |
|  **PART                II - OTHER INFORMATION**                                                                                                                                                                                                                                                                                           |
|  **Item                1.      Legal                Proceedings**                                                                                                                                                                                                                                                | 19       |
|  **Item                1A.   Risk Factors**                                                                                                                                                                                                                                                                                | 19       |
|  **Item                2.      Unregistered Sales of Equity Securities                and Use of Proceeds**                                                                                                                                                                                                      | 20       |
|  **Item                3.      Defaults upon Senior                Securities**                                                                                                                                                                                                                                  | 20       |
|  **Item                4.      Submission of Matters to a Vote of                Security Holders**                                                                                                                                                                                                              | 20       |
|  **Item                5.      Other                Information**                                                                                                                                                                                                                                                | 21       |
|  **Item                6.      Exhibits**                                                                                                                                                                                                                                                                        | 21       |
|  **SIGNATURES**                                                                                                                                                                                                                                                                                                                           |     |

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**PART      I - FINANCIAL INFORMATION**

**Item        1. Financial Statements**

**FORTRESS        INTERNATIONAL GROUP, INC.**

|                                                                |   |                           |       |                              |   |
|---------------------------------------------------------------------|--------|--------------------------------|------------|-----------------------------------|--------|
|                                                                |   | **(Successor)**                |       | **(Predecessor)**                 |   |
|                                                                |   | **March                  31,** |       | **December                  31,** |   | **January                  19,** |   | **December                  31,** |   |
|                                                                |   | **2007**                       |       | **2006**                          |   | **2007** |   | **2006** |   |
|                                                                |   | **(unaudited)**                |       | **(audited)**                     |   | **(unaudited)** |   | **(audited)** |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |
| ***Assets***                                                        |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Current                  Assets**                                 |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| Cash                  and cash equivalents                          |   | $                              | 25,675,952 |                              | $      | 7,347 |   | $ | 1,322,317 |   | $ | 2,361,838 |   |
| Contract                  and other receivables, net                |   |                           | 7,176,323  |                              |   | — |   |   | 6,261,988 |   |   | 9,960,851 |   |
| Prepaid                  expenses and other current assets          |   |                           | 722,253    |                              |   | 3,750 |   |   | 233,894 |   |   | 125,276 |   |
| Costs                  and estimated earnings in excess of billings |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
|   on                  uncompleted contracts               |   |                           | 661,061    |                              |   | — |   |   | 1,559,045 |   |   | 480,540 |   |
| Due                  from affiliated entities                       |   |                           | —    |                              |   | — |   |   | — |   |   | 201,670 |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Total                  Current Assets**                           |   |                           | 34,235,589 |                              |   | 11,097 |   |   | 9,377,244 |   |   | 13,130,175 |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Investments                  held in trust**                      |   |                           | —    |                              |   | 44,673,994 |   |   | — |   |   | — |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Property                  and equipment,**net                     |   |                           | 948,387    |                              |   | — |   |   | 904,689 |   |   | 810,747 |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Goodwill**                                                        |   |                           | 14,713,572 |                              |   | — |   |   | — |   |   | — |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Intangible                  assets,**net                          |   |                           | 19,866,248 |                              |   | — |   |   | — |   |   | — |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Deferred                  acquisition costs**                     |   |                           | —    |                              |   | 869,853 |   |   | — |   |   | — |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Other                  assets**                                   |   |                           | 410,054    |                              |   | — |   |   | 64,158 |   |   | 21,190 |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Deferred                  tax assets**                            |   |                           | 490,675    |                              |   | 490,675 |   |   | — |   |   | — |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Income                  tax recoverable**                         |   |                           | 531,641    |                              |   | — |   |   | — |   |   | — |   |
|                                                                |   |                           |       |                              |   |   |   |   |   |   |   |   |   |
| **Total                  Assets**                                   |   | $                              | 71,196,166 |                              | $      | 46,045,619 |   | $ | 10,346,091 |   | $ | 13,962,112 |   |

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**Fortress      International Group, Inc.**

|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                         |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|--------------|-----------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                    |   | **(Successor)**                |         |  **(Predecessor)**           |   |
|                                                                                                                                                                                                                                                                                                                    |   | **March                  31,** |         | **December                  31,** |   |  **January                  19,** |   | **December                  31,** |   |
|                                                                                                                                                                                                                                                                                                                    |   | **2007**                       |         | **2006**                          |   |  **2007** |   | **2006** |   |
|                                                                                                                                                                                                                                                                                                                    |   | **(unaudited)**                |         | **(audited)**                     |   |  **(unaudited)** |   | **(audited)** |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |    |   |   |   |
| ***Liabilities                  and Stockholders’ Equity***                                                                                                                                                                                                                                                       |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Current                  Liabilities**                                                                                                                                                                                                                                                                                |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| Notes                  payable-current portion                                                                                                                                                                                                                                                                          |   | $                              | 70,804       |                              | $      | — |   | $ | 72,808 |   | $ | 76,934 |   |
| Accounts                   payable and accrued expenses                                                                                                                                                                                                                                                                 |   |                           | 7,628,509    |                              |   | 913,222 |   |   | 6,641,718 |   |   | 8,503,024 |   |
| Advances                  from stockholder                                                                                                                                                                                                                                                                              |   |                           | —      |                              |   | 20,000 |   |   | — |   |   | — |   |
| Income                  taxes payable                                                                                                                                                                                                                                                                                   |   |                           | —      |                              |   | 586,283 |   |   | — |   |   | — |   |
| Billings                  in excess of costs and estitmated earnings                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
|   on                  uncompleted contracts                                                                                                                                                                                                                                                                   |   |                           | 1,081,984    |                              |   | — |   |   | 1,662,718 |   |   | 1,243,042 |   |
| Deferred                  compensation payable                                                                                                                                                                                                                                                                          |   |                           | —      |                              |   | — |   |   | — |   |   | 643,571 |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Total                  Current Liabilities**                                                                                                                                                                                                                                                                          |   |                           | 8,781,297    |                              |   | 1,519,505 |   |   | 8,377,244 |   |   | 10,466,571 |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Notes                  payable**                                                                                                                                                                                                                                                                                      |   |                           | 10,068,876   |                              |   | — |   |   | 79,524 |   |   | 81,679 |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Total                  Liabilities**                                                                                                                                                                                                                                                                                  |   |                           | 18,850,173   |                              |   | 1,519,505 |   |   | 8,456,768 |   |   | 10,548,250 |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| Common                  stock, subject to possible redemption 1,559,220 shares                                                                                                                                                                                                                                          |   |                           | —      |                              |   | 8,388,604 |   |   | — |   |   | — |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| Interest                  income on common stock subject to possible redemption                                                                                                                                                                                                                                         |   |                           | —      |                              |   | 541,735 |   |   | — |   |   | — |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Total                  common stock subject to redemption**                                                                                                                                                                                                                                                           |   |                           | —      |                              |   | 8,930,339 |   |   | — |   |   | — |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Commitments                  and Contingencies**                                                                                                                                                                                                                                                                      |   |                           | —      |                              |   | — |   |   | — |   |   | — |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Stockholders’                  Equity**                                                                                                                                                                                                                                                                         |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| Preferred                      stock- $.0001 par value; 1,000,000 shares authorized; no shares                      issued or outstanding                                                                                                                                                                          |   |                           | —      |                              |   | — |   |   | — |   |   | — |   |
| Common                    stock-- $.0001 par value, 50,000,000 shares authorized; 11,970,713                    and 9,550,000 issued; 11,970,713 and 9,550,000 outstanding, respectively                    (which includes 0 and 1,559,220 shares subject to possible redemption,                    respectively |   |                           | 1,196        |                              |   | 955 |   |   | — |   |   | — |   |
| Additional                  paid-in capital                                                                                                                                                                                                                                                                             |   |                           | 53,553,325   |                              |   | 34,819,062 |   |   | — |   |   | — |   |
| Treasury                  stock, at cost 221,000 and 0 shares (sucessor);                                                                                                                                                                                                                                               |   |                           | (1,221,817   | )                                 |   | — |   |   | — |   |   | — |   |
| Retained                  earnings                                                                                                                                                                                                                                                                                      |   |                           |  13,289 |                              |   | 775,758 |   |   | — |   |   | — |   |
| Members'                  equity                                                                                                                                                                                                                                                                                        |   |                           | —      |                              |   | — |   |   | 1,889,323 |   |   | 3,732,115 |   |
| Note                  receivable from affiliate                                                                                                                                                                                                                                                                         |   |                           | —      |                              |   | — |   |   | — |   |   | (318,253 | ) |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Total                  Stockholders’ Equity**                                                                                                                                                                                                                                                                   |   |                           | 52,345,993   |                              |   | 35,595,775 |   |   | 1,889,323 |   |   | 3,413,862 |   |
|                                                                                                                                                                                                                                                                                                                    |   |                           |         |                              |   |   |   |   |   |   |   |   |   |
| **Total                  Liabilities and Stockholders’ Equity**                                                                                                                                                                                                                                                   |   | $                              | 71,196,166   |                              | $      | 46,045,619 |   | $ | 10,346,091 |   | $ | 13,962,112 |   |

The      accompanying notes are an integral part of these consolidated financial      statements. 

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**Fortress      International Group, Inc.**

|                                                                         |   |                                            |       |                                            |   |
|------------------------------------------------------------------------------|--------|-------------------------------------------------|------------|-------------------------------------------------|--------|
|                                                                         |   | **(Successor)**                                 |       | **(Predecessor)**                               |   |
|                                                                         |   |                                            |       |                                            |   | **For                  the period** |   |   |   |
|                                                                         |   | **For                  the Three Months Ended** |       | **For                  the Three Months Ended** |   | **from                  January 1,****2007                  through** |   | **For                  the Three Months Ended** |   |
|                                                                         |   | **March                  31,**                  |       | **March                  31,**                  |   | **January                  19,** |   | **March                  31,** |   |
|                                                                         |   | **2007**                                        |       | **2006**                                        |   | **2007** |   | **2006** |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |
| **Revenue**                                                                  |   | $                                               | 8,676,937  |                                            | $      | — |   | $ | 1,412,137 |   | $ | 16,280,322 |   |
| **Cost                  of Revenue**                                         |   |                                            | 7,205,566  |                                            |   | — |   |   | 1,108,276 |   |   | 13,211,827 |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Gross                  Profit**                                            |   |                                            | 1,471,371  |                                            |   | — |   |   | 303,861 |   |   | 3,068,495 |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Operating                  costs and expenses**                            |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| Selling,                  general and administrative                         |   |                                            | 2,637,940  |                                            |   | 176,202 |   |   | 555,103 |   |   | 1,609,050 |   |
| Depreciation                  and amortization                               |   |                                            | 55,431     |                                            |   | — |   |   | 33,660 |   |   | 43,725 |   |
| Amortization                  of intangible assets                           |   |                                            | 440,454    |                                            |   | — |   |   | — |   |   | — |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Total                  operating costs and expenses**                      |   |                                            | 3,133,825  |                                            |   | 176,202 |   |   | 588,763 |   |   | 1,652,775 |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Operating                  (loss) income**                                 |   |                                            | (1,662,454 | )                                               |   | (176,202 | ) |   | (284,902 | ) |   | 1,415,720 |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Other                  Income (Expense)**                                  |   |                                            |            |                                            |   |   |   |   |   |   |   |   |   |
| Interest                  income                                             |   |                                            | 216,171    |                                            |   | 361,561 |   |   | 4,117 |   |   | — |   |
| Interest                  (expense)                                          |   |                                            | (117,366   | )                                               |   | — |   |   | (368 | ) |   | (4,965 | ) |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Income                  (Loss) Before Income Taxes**                       |   |                                            | (1,563,649 | )                                               |   | 185,359 |   |   | (281,153 | ) |   | 1,410,755 |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Income                  Tax (Benefit) Expense**                            |   |                                            | (531,641   | )                                               |   | 63,022 |   |   | — |   |   | — |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Net                  (Loss) Income**                                       |   | $                                               | (1,032,008 | )                                               | $      | 122,337 |   | $ | (281,153 | ) | $ | 1,410,755 |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Weighted                  average number of shares outstanding**           |   |                                            |            |                                            |   |  |   |   |  |   |   |  |   |
| **-basic**                                                                   |   |                                            | 11,390,487 |                                            |   | 9,550,000 |   |   | — |   |   | — |   |
| **   diluted**                                                |   |                                            | 11,390,487 |                                            |   | 9,550,000 |   |   | — |   |   | — |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Weighted                  average shares outstanding exclusive of shares** |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **subject                  to possible redemption**                          |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **-basic**                                                                   |   |                                            | 11,390,487 |                                            |   | 7,990,800 |   |   | — |   |   | — |   |
| **   diluted**                                                |   |                                            | 11,390,487 |                                            |   | 7,990,800 |   |   | — |   |   | — |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Basic                  net income (loss) per share**                       |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **-Net                  income**                                             |   | $                                               | (0.09      | )                                               | $      | 0.01 |   | $ | — |   | $ | — |   |
|                                                                         |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **Diluted                  net income (loss) per share**                     |   |                                            |       |                                            |   |   |   |   |   |   |   |   |   |
| **-Net                  income**                                             |   | $                                               | (0.09      | )                                               | $      | 0.01 |   | $ | — |   | $ | — |   |

----

**Fortress      International Group, Inc.**

|                                                                                                                                     |   |                                              |       |                                         |   |
|------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------|------------|---------------------------------------------------|--------|
|                                                                                                                                     |   | **(Successor)**                                   |       |  **(Predecessor)**                           |   |
|                                                                                                                                     |   | **For                    the Three Months Ended** |       | **For                    the Three Months Ended** |   |  **For                    the period from January 1, 2007 through ** |   | **For                    the Three****Months                    Ended** |   |
|                                                                                                                                     |   | **March                    31,**                  |       | **March                    31,**                  |   |  **January                    19,** |   | **March                    31,** |   |
|                                                                                                                                     |   | **2007**                                          |       | **2006**                                          |   | **2007** |   | **2006** |   |
| **Cash                    Flows from Operating Activities**                                                                              |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| Net                    income (loss)                                                                                                     |   | $                                                 | (1,032,008 | )                                                 | $      | 122,337 |   | $ | (281,153 | ) | $ | 1,410,755 |   |
| Adjustments                    to reconcile net income (loss) to net cash (used in) provided                    by operating activities: |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| Depreciation                    and amortization                                                                                         |   |                                              | 55,431     |                                              |   | — |   |   | 33,660 |   |   | 43,725 |   |
| Amortization                    of intangibles                                                                                           |   |                                              | 529,052    |                                              |   | — |   |   | — |   |   | — |   |
| Deferred                    income taxes                                                                                                 |   |                                              | —    |                                              |   | (85,070 | ) |   | — |   |   | — |   |
| Income                    tax recoverable                                                                                                |   |                                              | (531,641   | )                                                 |   | — |   |   | — |   |   | — |   |
| Stock-based                    compensation                                                                                              |   |                                              | 202,359    |                                              |   | — |   |   | — |   |   | — |   |
| Interest                    income on treasury bills                                                                                     |   |                                              | —    |                                              |   | (443,947 | ) |   | — |   |   | — |   |
| Changes                    in assets and liabilities, net of effects of acquisitions:                                                    |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| Contracts                    and other receivables                                                                                       |   |                                              | (914,335   | )                                                 |   | — |   |   | 3,698,863 |   |   | 4,596,154 |   |
| Costs                    and estimated earnings in excess of billings on uncompleted                    contracts                        |   |                                              | 897,984    |                                              |   | — |   |   | (1,078,505 | ) |   | (667,678 | ) |
| Prepaid                    expenses                                                                                                      |   |                                              | (484,607   | )                                                 |   | 24,002 |   |   | (108,618 | ) |   | (3,303 | ) |
| Due                    from affiliates                                                                                                   |   |                                              | —    |                                              |   | — |   |   | 519,923 |   |   | 822 |   |
| Other                    assets                                                                                                          |   |                                              | (345,896   | )                                                 |   | — |   |   | (42,968 | ) |   | — |   |
| Accounts                    payable and accrued expenses                                                                                 |   |                                              | 73,567     |                                              |   | 25,054 |   |   | (1,861,306 | ) |   | 269,533 |   |
| Billings                    in excess of costs and estitmated earnings on uncompleted                    contracts                       |   |                                              | (580,734   | )                                                 |   | — |   |   | 419,676 |   |   | (940,694 | ) |
| Income                    taxes payable                                                                                                  |   |                                              | (586,283   | )                                                 |   | 148,092 |   |   | — |   |   | — |   |
| Deferred                    compensation payable                                                                                         |   |                                              | —    |                                              |   | — |   |   | (643,571 | ) |   | — |   |
| Interest                    income attributable to common stock subject to possible                    redemption                        |   |                                              | —    |                                              |   | 88,745 |   |   | — |   |   | — |   |
|                                                                                                                                     |   |                                              |            |                                              |   |  |   |   |  |   |   |  |   |
| **Net                    Cash (Used in) Provided by Operating Activities**                                                               |   |                                              | (2,717,111 | )                                                 |   | (120,787 | ) |   | 656,001 |   |   | 4,709,314 |   |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Cash                    Flows from Investing Activities**                                                                              |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| Purchase                    of property and equipment                                                                                    |   |                                              | (99,129    | )                                                 |   | — |   |   | (127,602 | ) |   | (3,197 | ) |
| Decrease                    in Investments held in Trust fund                                                                            |   |                                              | 44,673,994 |                                              |   | — |   |   | — |   |   | — |   |
| Purchase                    of TSS/Vortech, net of cash received                                                                         |   |                                              | (9,677,683 | )                                                 |   | — |   |   | — |   |   | — |   |
| Deferred                    acquisition costs                                                                                            |   |                                              | (916,983   | )                                                 |   | — |   |   | — |   |   | — |   |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Net                    Cash Provided by (Used in) Investing Activities**                                                               |   |                                              | 33,980,199 |                                              |   | — |   |   | (127,602 | ) |   | (3,197 | ) |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Cash                    Flows from Financing Activities**                                                                              |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| Payments                    on notes payable                                                                                             |   |                                              | (12,652    | )                                                 |   | — |   |   | (6,281 | ) |   | (18,305 | ) |
| Advances                    from stockholder                                                                                             |   |                                              | (20,000    | )                                                 |   | — |   |   | — |   |   | — |   |
| Member                    distributions                                                                                                  |   |                                              | —    |                                              |   | — |   |   | (1,561,639 | ) |   | (323,127 | ) |
| Repurchase                    of common stock                                                                                            |   |                                              | (5,561,831 | )                                                 |   | — |   |   | — |   |   | — |   |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Net                    Cash (Used in) Provided by Financing Activities**                                                               |   |                                              | (5,594,483 | )                                                 |   | — |   |   | (1,567,920 | ) |   | (341,432 | ) |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Net                    Increase (Decrease) in Cash**                                                                                   |   |                                              | 25,668,605 |                                              |   | (120,787 | ) |   | (1,039,521 | ) |   | 4,364,685 |   |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Cash,**beginning                    of period                                                                                          |   |                                              | 7,347      |                                              |   | 992,547 |   |   | 2,361,838 |   |   | 1,737,075 |   |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Cash,**end                    of period                                                                                                |   | $                                                 | 25,675,952 |                                              | $      | 871,760 |   | $ | 1,322,317 |   | $ | 6,101,760 |   |
|                                                                                                                                     |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| **Supplemental                    disclosure of cash flow information**                                                                  |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| Cash                    paid for interest                                                                                                |   | $                                                 | 654        |                                              | $      | — |   | $ | 368 |   | $ | 4,965 |   |
| Cash                    paid for taxes                                                                                                   |   |                                              | 593,166    |                                              |   | — |   |   | — |   |   | — |   |
| **Supplemental                    disclosure of non cash Investing Activities**                                                          |   |                                              |       |                                              |   |   |   |   |   |   |   |   |   |
| Issuance                    of common stock in connection with acquisition of                    TSS/Vortech                             |   | $                                                 | 14,211,359 |                                              | $      | — |   |   | — |   |   | — |   |
| Notes                    payable entered into in connection with acquisition of                    TSS/Vortech                           |   |                                              | 10,000,000 |                                              |   | — |   |   | — |   |   | — |   |

----

**Fortress      International Group, Inc.**

**Notes      to the Consolidated Financial Statements**

**NOTE      A**
**      BASIS OF PRESENTATION**

**NOTE      B**
**      RECENT ACCOUNTING PRONOUNCEMENTS**

*Fair      Value Measurements*
*.*
* *
*.      *
*Accounting      for Derivative Instruments and Hedging Activities*

*The      Fair Value Option for Financial Assets and Financial Liabilities — Including an      amendment of FASB Statement No. 115*

----

**NOTE      C**
**      ACQUISITION OF TSS/VORTECH**

*Business      Combinations*

|   | · | TSS/Vortech                has a broad range of experience, contacts and service offerings in                the                mission critical facility industry. TSS/Vortech has a very experienced                and                committed management team with strong core competencies. TSS has                a                significant number of personnel with security clearances which is                important in the homeland security industry. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our                belief in TSS/Vortech’s business model and potential for growth,                increasing demand in its industry and its complete service offering                when                compared to other similar companies. In addition TSS/Vortech can                provide a                platform to assist us in managing acquisitions in the                future. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | TSS/Vortech                has been building a national business development organization to                expand                beyond its current regional presence. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Cash                                                                             |   | $      | 11,000,000 |   |
|----------------------------------------------------------------------------------|--------|--------|------------|--------|
| Common                  stock (2,602,813 shares per the purchase agreement) |   |   | 14,211,359 |   |
| Convertible                  notes payable to sellers                            |   |   | 10,000,000 |   |
| Transaction                  costs                                               |   |   | 1,773,068  |   |
| Total                  purchase price                                            |   |   | 36,984,427 |   |
| **Purchase                  price allocation:**                                  |   |   |       |   |
| Current                  assets                                                  |   |   | 9,377,244  |   |
| Property                  and equipment                                          |   |   | 904,689    |   |
| Intangible                  assets                                               |   |   | 20,395,300 |   |
| Goodwill                                                                         |   |   | 14,713,572 |   |
| Other                  assets                                                    |   |   | 64,158     |   |
| Total                  assets acquired                                           |   |   | 45,454,963 |   |
| Current                  liabilities                                             |   |   | 8,391,012  |   |
| Long-term                  liabilities                                           |   |   | 79,524     |   |
| Total                  liabilities assumed                                       |   |   | 8,470,536  |   |
| Net                  assets acquired                                             |   | $      | 36,984,427 |   |

|                                                    |   |                                 |       | **Weighted-Average**                     |   |
|---------------------------------------------------------|--------|--------------------------------------|------------|------------------------------------------|--------|
|                                                    |   | **Estimated                  Value** |       | **Amortization                  Period** |   |
| Non-contractual                  customer relationships |   | $                                    | 16,100,000 |                                     |   | 8                  years |   |
| Order                  Backlog                          |   |                                 | 456,300    |                                     |   | 1                  years |   |
| Trade                  Name                             |   |                                 | 3,839,000  |                                     |   | 15                  years |   |
|                                                    |   |                                 |       |                                     |   |   |   |
| Total                                                   |   | $                                    | 20,395,300 |                                     |   |   |   |

|                                                   |   | **Three                  months ended March 31,** |       |
|--------------------------------------------------------|--------|---------------------------------------------------|------------|
|                                                   |   | **2007**                                          |       | **2006** |   |
| Proforma                  revenue                      |   | $                                                 | 10,089,074 |   | $ | 16,280,322 |   |
| Proforma                  operating (loss) income      |   |                                              | (1,947,356 | ) |   | 710,465 |   |
| Proforma                  pretax (loss) income         |   |                                              | (1,844,802 | ) |   | 950,248 |   |
| Proforma                  net (loss) income            |   |                                              | (1,217,569 | ) |   | 627,164 |   |
| Net                  (loss) income per share (basic )  |   |                                              | (0.09      | ) |   | 0.07 |   |
| Net                  (loss) income per share (diluted) |   |                                              | -          |   |   | 0.07 |   |

**NOTE      D**
**      INVESTMENTS HELD IN TRUST**

----

**NOTE      E**
**      INCOME (LOSS) PER SHARE**

*Earnings      Per Share*

|                                               |   | **(Successor)**                                   |       | **(Predecessor)**                |   |
|----------------------------------------------------|--------|---------------------------------------------------|------------|----------------------------------|--------|
|                                               |   |                                              |       |                             |   | **Period                  from** |   |   |   |
|                                               |   |                                              |       |                             |   | **January                  1,** |   |   |   |
|                                               |   |                                              |       |                             |   | **through** |   | **Three                       Months** |   |
|                                               |   | **Three                  Months Ended March 31,** |       | **January                  19,** |   | **Ended                  March 31,** |   |
|                                               |   | **2007**                                          |       | **2006**                         |   | **2007** |   | **2006** |   |
| Net                  (loss) income allocable to    |   |                                              |       |                             |   |   |   |   |   |   |   |   |   |
| common                  stockholders not subject   |   |                                              |       |                             |   |   |   |   |   |   |   |   |   |
| to                  possible redemption            |   | $                                                 | (1,032,008 | )                                | $      | 122,137 |   | $ | (281,153 | ) | $ | 1,410,755 |   |
| Weighted                  average number of        |   |                                              |       |                             |   |   |   |   |   |   |   |   |   |
| shares                  outstanding - basic        |   |                                              | 11,390,487 |                             |   | 9,550,000 |   |   | - |   |   | - |   |
| Weighted                  average number of        |   |                                              |       |                             |   |   |   |   |   |   |   |   |   |
| shares                  outstanding - diluted      |   |                                              | 11,390,487 |                             |   | 9,550,000 |   |   | - |   |   | - |   |
| Income                  (loss) per share - basic   |   | $                                                 | (0.09      | )                                | $      | 0.01 |   |   | - |   |   | - |   |
| Income                  (loss) per share - diluted |   | $                                                 | (0.09      | )                                | $      | 0.01 |   |   | - |   |   | - |   |

**NOTE      F**
**      EMPLOYEE STOCK-BASED COMPENSATION**

*Share      Based Payment,*

 

----

**NOTE      G**
** **
**COMMON      STOCK REDEMPTION**

**NOTE      H**
**-**
**      INCOME TAXES**

*Accounting      for Uncertainty in Income Taxes*

**NOTE      I - CONVERTIBLE PROMISSORY NOTES**

| **Year                  ending** |   |       |      |
|----------------------------------|--------|------------|-----------|
| **March                  31,**   |   | **Amount** |      |
|                             |   |       |      |
| 2008                             |   | $          | -         |   |
| 2009                             |   |       | 833,334   |   |
| 2010                             |   |       | 3,333,333 |   |
| 2011                             |   |       | 3,333,333 |   |
| 2012                             |   |       | 2,500,000 |   |

----

**NOTE      J**
**-**
**      RELATED PARTY TRANSACTIONS**

**S3      Integration LLC.**

**Chesapeake      Tower Systems, Inc**

**CTS      Services, LLC**

**L.H.      Cranston Acquisition Group, Inc**
***.***

**Telco      P&C, LLC.**

**Automotive      Technologies, Inc.**

**TPR      Group Re Three LLC.**

|                                                              |   | **2007** |     | **2006** |   |
|-------------------------------------------------------------------|--------|----------|----------|----------|--------|
| **Revenue**                                                       |   |     |     |     |   |
| CTS                  Services, LLC                                |   | $        | 37,840   |     | $      | 45,486 |   |
| Chesapeake                  Tower Systems, Inc.                   |   |     | 429      |     |   | 7,147 |   |
|                                                              |   |     |     |     |   |   |   |
| **Cost                  of Revenue**                              |   |     |     |     |   |   |   |
| Chesapeake                  Tower Systems, Inc.                   |   |     | 100,327  |     |   | 71,484 |   |
| CTS                  Services, LLC                                |   |     | 239,428  |     |   | 784,544 |   |
| S3                  Integration, LLC                              |   |     | 88,179   |     |   | - |   |
| LH                  Cranston & Sons, Inc.                     |   |     | 10,777   |     |   | 95,303 |   |
| Telco                  P&C, LLC                               |   |     | 29,282   |     |   | 1,575 |   |
|                                                              |   |     |     |     |   |   |   |
| Office                  rent paid on Chesapeake sublease agmt     |   |     | 46,950   |     |   | 39,142 |   |
| Office                  rent paid to TPR Group Re Three, LLC      |   |     | 100,984  |     |   | - |   |
| Vehicle                  repairs to Automotive Technologies, Inc. |   |     | 4,442    |     |   | - |   |
|                                                              |   |     |     |     |   |   |   |
|                                                              |   |     |     |     |   |   |   |
| **Accounts                  receivable/(payable):**               |   |     |     |     |   |   |   |
| CTS                  Services, LLC                                |   |     | 64,402   |     |   | 22,202 |   |
| CTS                  Services, LLC                                |   |     | (344,733 | )        |   | (426,274 | ) |
| Telco                  P&C, LLC                               |   |     | (3,147   | )        |   | 1,575 |   |
| LH                  Cranston & Sons, Inc.                     |   |     | (10,777  | )        |   | (4,546 | ) |

----

**NOTE      K - SEGMENT ACCOUNTING**

**NOTE      L**
**-**
**      COMMITMENTS**

***Employment      Agreements***

| · | if                the highest average share price of the Company’s common stock during any                60 consecutive trading day period between the closing of the acquisition                and July 13, 2008 exceeds $9.00 per share but is no more than $10.00                per share, he will be entitled to $0.5 million worth of additional                shares;                or |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | if                the highest average share price of Company’s common stock during any 60                consecutive trading day period between the closing of the acquisition                and                July 13, 2008 exceeds $10.00 per share but is no more than $12.00 per                share, he will be entitled to $1.5 million worth of additional shares;                or |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | if                the highest average share price of Company’s common stock during any 60                consecutive trading day period between the closing of the acquisition                and                July 13, 2008 exceeds $12.00 per share but is no more than $14.00 per                share, he will be entitled to $3.0 million worth of additional shares;                or |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | if                the highest average share price of Company’s common stock during any 60                consecutive trading day period between the closing of the acquisition                and                July 13, 2008 exceeds $14.00 per share, he will be entitled to $5.0                million worth of additional                shares. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**Item      2. Management’s Discussion and Analysis of Financial Condition and Results of      Operations.**

      and its      consolidated subsidiaries, unless otherwise indicated.

**Company      Overview**

----

**Contract      Backlog**

|                                   |   | March                31, 2007 |       | December                31, 2006 |   |
|----------------------------------------|--------|-------------------------------|------------|----------------------------------|--------|
| Technology                consulting   |   | $                             | 2,509,000  |                             | $      | 1,266,000 |   |
| Construction                management |   |                          | 13,695,000 |                             |   | 11,757,000 |   |
| Facilities                management   |   |                          | 8,436,000  |                             |   | 7,585,000 |   |
|                                   |   |                          |       |                             |   |   |   |
|                                   |   | $                             | 24,640,000 |                             | $      | 20,608,000 |   |

----

**FORTRESS        INTERNATIONAL GROUP, INC.**

|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                 |       |                                                                                                                           |   |                                                                                      |   |
|-----------------------------------------------------------|--------|-------------------------------------------------------------------------------------------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------|------------|--------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------|--------|
|                                                      |   | **(Successor)**                                                                           |       | **(Predecessor)**                                                                                                                                        |   | **Proforma****combined**                                                                  |   | **(Successor)**                                                                           |       | **(Predecessor)**                                                                                                              |   | **Proforma****combined**                                                                  |   |
|                                                      |   | **For                    the Three Months Ended****March                    31,****2007** |       | **For                    the period****from                    January 1,****2007                    through****January                    19,****2007** |   | **For                    the Three Months Ended****March                    31,****2007** |   | **For                    the Three Months Ended****March                    31,****2006** |       | **For                    the****Three**** Months                    Ended****March                    31,**** 2006** |   | **For                    the Three Months Ended****March                    31,****2006** |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                 |       |                                                                                                                           |   |                                                                                      |   |
| **Revenue**                                               |   | $                                                                                         | 8,676,937  |                                                                                                                                                     |   | 1,412,137                                                                                 |   |                                                                                      | 10,089,074 |                                                                                                                           | $      | —                                                                                   |   | $ | 16,280,322 |   | $ | 16,280,322 |   |
| **Cost                    of Revenue**                    |   |                                                                                      | 7,205,566  |                                                                                                                                                     |   | 1,108,276                                                                                 |   |                                                                                      | 8,313,842  |                                                                                                                           |   | 88,599                                                                                    |   |   | 13,211,827 |   |   | 13,300,426 |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Gross                    Profit**                       |   |                                                                                      | 1,471,371  |                                                                                                                                                     |   | 303,861                                                                                   |   |                                                                                      | 1,775,232  |                                                                                                                           |   | (88,599                                                                                   | )      |   | 3,068,495 |   |   | 2,979,896 |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Operating                    costs and expenses**       |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| Selling,                    general and administrative    |   |                                                                                      | 2,637,940  |                                                                                                                                                     |   | 555,103                                                                                   |   |                                                                                      | 3,193,043  |                                                                                                                           |   | 176,202                                                                                   |   |   | 1,609,050 |   |   | 1,785,252 |   |
| Depreciation                    and amortization          |   |                                                                                      | 55,431     |                                                                                                                                                     |   | 33,660                                                                                    |   |                                                                                      | 89,091     |                                                                                                                           |   | —                                                                                   |   |   | 43,725 |   |   | 43,725 |   |
| Amortization                    of intangible assets      |   |                                                                                      | 440,454    |                                                                                                                                                     |   | —                                                                                   |   |                                                                                      | 440,454    |                                                                                                                           |   | 440,454                                                                                   |   |   | — |   |   | 440,454 |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Total                    operating costs and expenses** |   |                                                                                      | 3,133,825  |                                                                                                                                                     |   | 588,763                                                                                   |   |                                                                                      | 3,722,588  |                                                                                                                           |   | 616,656                                                                                   |   |   | 1,652,775 |   |   | 2,269,431 |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Operating                    income**                   |   |                                                                                      | (1,662,454 | )                                                                                                                                                        |   | (284,902                                                                                  | )      |                                                                                      | (1,947,356 | )                                                                                                                              |   | (705,255                                                                                  | )      |   | 1,415,720 |   |   | 710,465 |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Other                    Income (Expense)**             |   |                                                                                      |            |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| Interest                    income                        |   |                                                                                      | 216,171    |                                                                                                                                                     |   | 4,117                                                                                     |   |                                                                                      | 220,288    |                                                                                                                           |   | 361,561                                                                                   |   |   | — |   |   | 361,561 |   |
| Interest                    (expense)                     |   |                                                                                      | (117,366   | )                                                                                                                                                        |   | (368                                                                                      | )      |                                                                                      | (117,734   | )                                                                                                                              |   | (116,813                                                                                  | )      |   | (4,965 | ) |   | (121,778 | ) |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Income                    (Loss) Before Income Taxes**  |   |                                                                                      | (1,563,649 | )                                                                                                                                                        |   | (281,153                                                                                  | )      |                                                                                      | (1,844,802 | )                                                                                                                              |   | (460,507                                                                                  | )      |   | 1,410,755 |   |   | 950,248 |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **As                    a Percentage of Revenue**         |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Revenue**                                               |   |                                                                                      | 100.0      | %                                                                                                                                                        |   | 100.0                                                                                     | %      |                                                                                      | 100.0      | %                                                                                                                              |   | —                                                                                   |   |   | 100.0 | % |   | 100.0 | % |
| **Cost                    of Revenue**                    |   |                                                                                      | 83.0       | %                                                                                                                                                        |   | 78.5                                                                                      | %      |                                                                                      | 82.4       | %                                                                                                                              |   | —                                                                                   |   |   | 81.2 | % |   | 81.7 | % |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Gross                    Profit**                       |   |                                                                                      | 17.0       | %                                                                                                                                                        |   | 21.5                                                                                      | %      |                                                                                      | 17.6       | %                                                                                                                              |   |                                                                                      |   |   | 18.8 | % |   | 18.3 | % |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Operating                    costs and expenses**       |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| Selling,                    general and administrative    |   |                                                                                      | 30.4       | %                                                                                                                                                        |   | 39.3                                                                                      | %      |                                                                                      | 31.6       | %                                                                                                                              |   |                                                                                      |   |   | 9.9 | % |   | 11.0 | % |
| Depreciation                    and amortization          |   |                                                                                      | 0.6        | %                                                                                                                                                        |   | 2.4                                                                                       | %      |                                                                                      | 0.9        | %                                                                                                                              |   |                                                                                      |   |   | 0.3 | % |   | 0.3 | % |
| Amortization                    of intangible assets      |   |                                                                                      | 5.1        | %                                                                                                                                                        |   | 0.0                                                                                       | %      |                                                                                      | 4.4        | %                                                                                                                              |   |                                                                                      |   |   | 0.0 | % |   | 2.7 | % |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Total                    operating costs and expenses** |   |                                                                                      | 36.1       | %                                                                                                                                                        |   | 41.7                                                                                      | %      |                                                                                      | 36.9       | %                                                                                                                              |   |                                                                                      |   |   | 10.2 | % |   | 13.9 | % |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Operating                    income**                   |   |                                                                                      | -19.2      | %                                                                                                                                                        |   | -20.2                                                                                     | %      |                                                                                      | -19.3      | %                                                                                                                              |   | 0.0                                                                                       | %      |   | 8.7 | % |   | 4.4 | % |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Other                    Income (Expense)**             |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| Interest                    income                        |   |                                                                                      | 2.5        | %                                                                                                                                                        |   | 0.3                                                                                       | %      |                                                                                      | 2.2        | %                                                                                                                              |   | 100.0                                                                                     | %      |   | 0.0 | % |   | 2.2 | % |
| Interest                    (expense)                     |   |                                                                                      | -1.4       | %                                                                                                                                                        |   | 0.0                                                                                       | %      |                                                                                      | -1.2       | %                                                                                                                              |   | -32.3                                                                                     | %      |   | 0.0 | % |   | -0.7 | % |
|                                                      |   |                                                                                      |       |                                                                                                                                                     |   |                                                                                      |   |                                                                                      |       |                                                                                                                           |   |                                                                                      |   |   |   |   |   |   |   |
| **Income                    (Loss) Before Income Taxes**  |   |                                                                                      | -18.0      | %                                                                                                                                                        |   | -19.9                                                                                     | %      |                                                                                      | -18.3      | %                                                                                                                              |   | -127.4                                                                                    | %      |   | 8.7 | % |   | 5.8 | % |

**Critical      Accounting Policies **

***Revenue      Recognition***

----

***Goodwill      and Other Intangible Assets***

***Allowance      for Doubtful Accounts***

***Income      Taxes***

**Results      of operations for the successor company for the three months ended March 31,      2007 compared with the three months ended March 31, 2006.**

*Revenue      and cost of revenue. *

*Selling,      general and administrative expenses. *
* *

----

*Depreciation      and amortization of intangible assets.*

*Interest      income. *

*Interest      expense.*

*Income      tax benefit (expense). *

**Results      of operations on a pro forma combined basis for the successor company for the      three months ended March 31, 2007 compared with the three months ended March      31,      2006.**

*Revenue      and cost of revenue. *

----

*Selling,      general and administrative expenses. *
* *

| · | sales                salaries and expenses - $653,000 |
|--------|-------------------------------------------------------|

| · | marketing                expenses- $214,000 |
|--------|---------------------------------------------|

| · | public                company costs- $518,000 |
|--------|-----------------------------------------------|

| · | non                cash compensation for restricted stock for key employees-                $202,000 |
|--------|------------------------------------------------------------------------------------------------------|

*Depreciation      and amortization of intangible assets.*

*Interest      income. *

*Interest      expense.*

**Financial      Condition, Liquidity and Capital Resources **

***Financial      Condition***

----

***Liquidity      and Capital Resources***

** **

***Off      Balance Sheet Arrangements***
* *

***Recent      Accounting Pronouncements***
*.*

*The      Fair Value Option for Financial Assets and Financial Liabilities — Including an      amendment of FASB Statement No. 115 *

**Item      3. Quantitative and Qualitative Disclosures About Market      Risk.**

----

**Item      4. Controls and Procedures.**

**Changes      in Internal Control Over Financial Reporting**

**PART      II - OTHER INFORMATION**

**Item      1. Legal Proceedings.**

**Item      1A. Risk Factors**

----

**Item      2. Unregistered Sales of Equity Securities and Use of      Proceeds.**

|                               |   | **Purchases                of Equity Securities by Issuer** |    |                                  |   |                                   |   |
|------------------------------------|--------|-------------------------------------------------------------|---------|---------------------------------------|--------|----------------------------------------|--------|
|                               |   |                                                        |    |                                  |   | **Total                Number of**     |   | **Maximum                Number** |   |
|                               |   |                                                        |    |                                  |   | **Shares                Purchased as** |   | **of                Shares (or Units)** |   |
|                               |   |                                                        |    |                                  |   | **Part                of Publicly**    |   | **that                May Yet Be** |   |
|                               |   | **Total                Number of**                          |    | **Average                Price Paid** |   | **Announced                Plans or**  |   | **Purchased                Under the** |   |
| **Period**                         |   | **Shares                Purchased**                         |    | **per                Share**          |   | **Programs**                           |   | **Plans                or Programs** |   |
| January                1-31, 2007  |   |                                                        | 116,000 |                                  | $      | 5.49                                   |   |   | 116,000 |   |   | 384,000 |   |
| February                1-28, 2007 |   |                                                        | 94,500  |                                  | $      | 5.60                                   |   |   | 210,500 |   |   | 289,500 |   |
| March                1-31, 2007    |   |                                                        | 10,500  |                                  | $      | 5.33                                   |   |   | 221,000 |   |   | 279,000 | (1) |
|                               |   |                                                        |    |                                  |   |                                   |   |   |   |   |   |   |   |
|                               |   |                                                        |    |                                  |   |                                   |   |   |   |   |   |   |   |
| January                1-31, 2007  |   |                                                        | 756,100 |                                  | $      | 5.38                                   |   |   | 756,100 |   |   | 0 | (2) |
|                               |   |                                                        |    |                                  |   |                                   |   |   |   |   |   |   |   |
| Total                              |   |                                                        | 977,100 |                                  | $      | 5.41                                   |   |   | 977,100 |   |   |   |   |

**Recent      Sales of Unregistered Securities**

**Item      3. Defaults Upon Senior Securities.**

**Item      4. Submission of Matters to a Vote of Security Holders.**

| 1. | The                proposal to approve the acquisition of TSS/Vortech substantially                on the                terms set forth in the Second Amended and Restated Membership Interest                Purchase Agreement dated July 31, 2006 (referred to as the “purchase                agreement”) by and among Fortress America Acquisition Corporation, VTC,                L.L.C., Vortech, LLC, and Thomas P. Rosato and Gerard J. Gallagher,                as the                members of VTC, L.L.C. and Vortech, LLC, and the other transactions                contemplated by the purchase agreement, for which voting at the meeting                was as follows: 5,835,270                votes                cast for; 760,600                votes                cast against; 11,483                shares                abstaining. |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 2. | The                proposal to approve the Amended and Restated Certificate of Incorporation                changing our name from “Fortress America Acquisition Corporation” to                “Fortress International Group, Inc.” and removing certain provisions only                applicable to us prior to our completion of a business combination,                for                which voting at the meeting was as follows: 7,973                570                votes cast for; 68,400                votes                cast against; 315,383                shares abstaining. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3. | The                proposal to approve the adoption of the 2006 Omnibus Incentive                Compensation Plan, for which voting at the meeting was as follows:                7,108,703                votes                cast for; 1,196,301                votes                cast against; 52,349                shares                abstaining. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | The                proposal to elect David J. Mitchell as a director for a three-year                term                expiring in 2009,, for which voting at the meeting was as follows:                8,023,070                votes                cast for; 0                votes                cast against; and 334,283                votes                withheld. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5. | The                  proposal to approve any adjournments or postponements of the meeting                  to a                  later date(s), if necessary, to permit further solicitation and                  vote of                  proxies, for which voting at the meeting was as follows: 7,572,270                  votes                  cast for; 560,183                  votes                  against; 224,900                  shares abstaining.  |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Item      5. Other Information.**

**Item      6. Exhibits.**

| 10.1   | Non-Employee                Director Compensation Policy                |
|--------|-------------------------------------------------------------------------|
|   |                                                                    |
| 10.2   | Form                of Restricted Stock Agreement                       |
|   |                                                                    |
| 31.1   | Section                302 Certification by Principal Executive Officer |
|   |                                                                    |
| 31.2   | Section                302 Certification by Principal Financial Officer |
|   |                                                                    |
| 32.1   | Section                906 Certification                                |

----

**SIGNATURES      **

|                                |   |                                                    |   |                                                                                                                      |
|-------------------------------------|--------|---------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------|
|                                |   | **FORTRESS                  INTERNATIONAL GROUP, INC.** |
|                                |   |                                                    |
| Date:                  May 21, 2007 |   | By:                                                     |   | /s/                  Thomas P. Rosato                                                                                     |
|                                |   |                                                    |   | Thomas                  P. Rosato                                                                                         |
|                                |   |                                                    |   | *Chief                  Executive Officer (Principal Executive Officer and Principal Financial                  Officer)* |

----