**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**FORM      10-K/A**

**(Amendment      No. 1)**

| x | ANNUAL                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 |
|---|-----------------------------------------------------------------------------------------------------------------------------------|

**OR**

| o | TRANSITION                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 |
|---|---------------------------------------------------------------------------------------------------------------------------------------|

**000-51426**

**FORTRESS      INTERNATIONAL GROUP, INC.**

*(Exact      name of registrant as specified in its charter)*

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

**(410)      312-9988**

| Title                of each class                                                                                                                                                                      |   | Name of each exchange on                which registered |                            |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------|---------------------------------|
|                                                                                                                                                                                                    |   |                                                                              |                            |
| Common                Stock, $.0001 par value per share                                                                                                                                                 |   |                                                                              | NASDAQ Capital Market |   |
| Warrants                to purchase common stock, $.0001 par value per share                                                                                                                            |   |                                                                              | NASDAQ Capital Market |   |
| Units,                each consisting of one share of Common Stock, $.0001 par value and                two                warrants to purchase shares of common stock, $.0001 par                value |   |                                                                              | NASDAQ Capital Market |   |

----

| Large accelerated filer o   |   | Accelerated filer o |   | Non-accelerated filer o | [Do not check if a smaller |
|--------------------------------------------|--------|-------------------------------|--------|-----------------------------------|-----------------------------------------------------|
| Smaller reporting company x |   |                          |   |                              | reporting company]                             |

**DOCUMENTS      INCORPORATED BY REFERENCE**

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**EXPLANATORY      NOTE**

----

**FORTRESS      INTERNATIONAL GROUP, INC. **

**FORM      10-K/A **

**INDEX      **

|                    |                                                                                                                         | **Page**  |
|-------------------------|------------------------------------------------------------------------------------------------------------------------------|----------------|
|                    |                                                                                                                         |           |
|                    | **PART                III**                                                                                                  |           |
|                    |                                                                                                                         |           |
| ITEM                10. | DIRECTORS,                EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                        | 3              |
|                    |                                                                                                                         |           |
| ITEM                11. | EXECUTIVE                COMPENSATION                                                                                        | 8              |
|                    |                                                                                                                         |           |
| ITEM                12. | SECURITY                OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED                STOCKHOLDER MATTERS | 18             |
|                    |                                                                                                                         |           |
| ITEM                13. | CERTAIN                RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR                INDEPENDENCE                      | 19             |
|                    |                                                                                                                         |           |
| ITEM                14. | PRINCIPAL                ACCOUNTING FEES AND SERVICES                                                                        | 23             |
|                    |                                                                                                                         |           |
|                    | **PART                IV**                                                                                                   |           |
|                    |                                                                                                                         |           |
| ITEM                15. | EXHIBITS                                                                                                                     | 25             |
|                    |                                                                                                                         |           |
| SIGNATURES         |                                                                                                                         |

----

**PART      III**

| **Item              10.** | **DIRECTORS,                EXECUTIVE OFFICERS AND CORPORATE                GOVERNANCE** |
|---------------------------|------------------------------------------------------------------------------------------|

**Executive      Officers and Directors**

| **Name**                              |   | **Age**** ** |   | **Position**                                                        |
|--------------------------------------------|--------|-------------------|--------|---------------------------------------------------------------------|
| Harvey                L. Weiss             |   | 65                |   | Chairman                of the Board                                |
| C.                Thomas McMillen*         |   | 55                |   | Vice                Chairman of the Board                           |
| Thomas                P. Rosato            |   | 56                |   | Chief                Executive Officer and Director                 |
| Gerard                J. Gallagher         |   | 51                |   | President,                Chief Operating Officer and Director      |
| Timothy                C. Dec              |   | 49                |   | Chief                Financial Officer and Chief Accounting Officer |
| David                J. Mitchell* (1)(3)   |   | 46                |   | Director                                                            |
| Donald                L. Nickles* (2)      |   | 59                |   | Director                                                            |
| John                Morton, III* (1)(2)(3) |   | 64                |   | Director                                                            |
| Asa                Hutchinson* (1)(2)(3)   |   | 57                |   | Director                                                            |
| William                L. Jews* (1)(3)     |   | 56                |   | Director                                                            |

***Harvey      L. Weiss***

***C.      Thomas McMillen***

----

***Thomas      P. Rosato***

***Gerard      J. Gallagher***
*Summa      Cum Laude*

***Timothy      C. Dec***

***David      J. Mitchell***

----

***Donald      L. Nickles***

***John      Morton III***

***Asa      Hutchinson***

***William      L. Jews***

**Board      of Directors**

|  | · | The                    Class I directors are Messrs. David J. Mitchell, Gerard J. Gallagher                    and                    Asa Hutchinson, and their term will end at the 2009 annual meeting                    of                    stockholders. |
|--|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|  | · | The                    Class II directors are Messrs. Harvey L. Weiss, Donald L. Nickles                    and                    William L. Jews, and their term will end at the 2010 annual meeting                    of                    stockholders; |
|--|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |
|--------|--------|--------|

|  | · | The                    Class III directors are Messrs. C. Thomas McMillen, Thomas P. Rosato                    and John Morton, III, and their term will end at the 2008 annual                    meeting                    of stockholders; and |
|--|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Board      Committees**

***Audit      Committee***

*www.thefigi.co*

***Compensation      Committee***

*www.thefigi.co*

***Special      Committee***

----

**Board      and Committee Meetings**

|                                  | Number                of |
|---------------------------------------|--------------------------|
|                                  | Meetings                 |
|                                  |                     |
| Board                                 | 7                        |
| Audit                Committee        | 4                        |
| Compensation                Committee | 4                        |
| Special                Committee      | 5                        |

**Nominations      for Directors**

**Stockholder      Communications to the Board**

----

**Section      16(a) Beneficial Ownership Reporting Compliance**

**Code      of Conduct and Ethics**

| **Item              11.** | **EXECUTIVE                COMPENSATION** |
|---------------------------|-------------------------------------------|

**Compensation      Discussion and Analysis**

***Overview***

|   | · | review,                modify and approve our overall compensation strategy;                                                                                                                                                                                                                                                                                                                                                                                          |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | · | recommend                to the Board the compensation and terms of employment of our executive                officers, including Thomas P. Rosato, our Chief Executive Officer,                Gerard                J. Gallagher, our President and Chief Operating Officer, and Timothy                C.                Dec, our Chief Financial Officer, and to evaluate their respective                performance in light of relevant goals and objectives; |
|   | · | review                and recommend to our board the type and amount of compensation to                be paid                or awarded to the members of our Board;                                                                                                                                                                                                                                                                                                 |
|   | · | recommend                to our Board the adoption, amendment and termination of any bonus,                equity                and other deferred compensation plans, including the 2006 Omnibus                Incentive Compensation Plan (“2006 Stock Plan”);                                                                                                                                                                                        |
|   | · | determine                appropriate insurance coverage for our executive officers and directors;                and                                                                                                                                                                                                                                                                                                                                                  |
|   | · | review,                discuss and assess its own performance at least                annually.                                                                                                                                                                                                                                                                                                                                                                       |

----

**General      Compensation Philosophy **

|   | · | enable                the company to attract, engage and retain key executives and employees                critical to future success;                                                                                                                                                             |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | · | motivate                and inspire employee behavior which fosters a high performance culture;                and                                                                                                                                                                                  |
|   | · | support                the overall business objectives and ensure that a significant component                of                the compensation opportunity will be related to factors that both                directly                and indirectly influence shareholder                value. |

|   | · | *Annual                salary. *Designed                to reward the core competence in the executive role relative to the                skills, experience and contribution to our company.                                    |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | · | *Annual                cash incentive/bonus awards. *Designed                to reward the executive for specific contributions to our company                aligned                to both corporate and individual objectives. |
|   | · | *Long-term                equity compensation. *Designed                to align the executives’ interests with those of the                shareholders.                                                                   |
|   | · | Certain                other benefits, including retirement and welfare                plans.                                                                                                                                          |

***Compensation      Components***
** **

*Base      Salary *

----

*Bonuses*

|   | · | initiate                a practice of periodically reviewing the performance of all senior                executives at Board meetings; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------|
|   | · | establish                annual reviews of compensation reports for the named executive officers.                                           |

*Long-Term      Equity Compensation *

*Other      Benefits *

**Tax      Considerations **

**Employment      Agreements**

----

**Change      in Control and Severance**

**Role      of Executive Officers in Executive Compensation**

**Compensation      Committee Report**

|   | Members of the Fortress International Group, Inc. Compensation Committee |
|--------|------------------------------------------------------------------------------------------------------------------|
|   | **Donald                L. Nickles**                                                                             |
|   | **Asa                Hutchinson**                                                                                |
|   | **John                Morton, III**                                                                              |

----

**Summary      Compensation Table**

|                                                                 |   |   |       | Annual Compensation |   |
|----------------------------------------------------------------------|--------|--------|------------|--------------------------|--------|
|                                                                 |   |   |       |                     |   |   |   | Stock |   | Other |   |   |   |
| Name and Principal Position(s)                        |   | Year   |       | Salary                   |   | Bonus |   | Awards (1) |   | Compensation (2) |   | Total |   |
|                                                                 |   |   |       |                     |   |   |   |   |   |   |   |   |   |
| Thomas                  P. Rosato (3)                                |   |   |       |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Chief                  Executive Officer                             |   |   | 2007  |                     | $      | 401,665 |   | $ | - |   | $ | - |   | $ | 282,881 |   | $ | 684,546 |   |
|                                                                 |   |   | 2006  |                     |   | 166,788 |   |   | - |   |   | - |   |   | 33,563 |   |   | 200,351 |   |
|                                                                 |   |   |       |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gerard                  J. Gallagher (3)                             |   |   |       |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| President and Chief Operating Officer            |   |   | 2007  |                     |   | 405,865 |   |   | - |   |   | - |   |   | 277,505 |   |   | 683,370 |   |
|                                                                 |   |   | 2006  |                     |   | 350,000 |   |   | 42,580 |   |   | - |   |   | 48,710 |   |   | 441,290 |   |
|                                                                 |   |   |       |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Timothy                  C. Dec (4)                                  |   |   |       |                     |   |  |   |   |   |   |   |  |   |   |  |   |   |  |   |
| Chief                  Financial Officer                             |   |   | 2007  |                     |   | 76,757 |   |   | - |   |   | 33,278 |   |   | 3,200 |   |   | 113,235 |   |
|                                                                 |   |   |       |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Harvey                  L. Weiss (5)                                 |   |   |       |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Chairman and former Chief Executive Officer |   |   | 2007  |                     |   | 180,769 |   |   | - |   |   | - |   |   | 34,091 |   |   | 214,860 |   |
|                                                                 |   |   |       |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

**All      Other Compensation Table **

|                                      |   | 401(k)                      |   | Club                             |   | Rent          |   | Automobile                      |   | Interest                       |   | Long-term                        |   |                     |    |
|-------------------------------------------|--------|-----------------------------|--------|----------------------------------|--------|---------------|--------|---------------------------------|--------|--------------------------------|--------|----------------------------------|--------|--------------------------|---------|
|                                      |   | Match                ($)(1) |   | Membership                ($)(2) |   | Expense($)(3) |   | Allowance                ($)(4) |   | Payments                ($)(5) |   | Disability                ($)(6) |   | Total                ($) |    |
| 2007                                      |   |                        |   |                             |   |          |   |                            |   |                           |   |                             |   |                     |    |   |   |   |   |   |   |   |
| Thomas                P. Rosato           |   |                        | 7,654  |                             |   | 4,645         |   |                            | 33,000 |                           |   | 19,248                           |   |                     | 218,334 |   |   | - |   |   | 282,881 |   |
| Gerald                J. Gallagher        |   |                        | 7,750  |                             |   | 16,407        |   |                            | -      |                           |   | 16,636                           |   |                     | 234,247 |   |   | 2,466 |   |   | 277,505 |   |
| Timothy                C. Dec             |   |                        | -      |                             |   | -             |   |                            | -      |                           |   | 3,200                            |   |                     | -       |   |   | - |   |   | 3,200 |   |
| Harvey                L. Weiss            |   |                        | 1,091  |                             |   | -             |   |                            | 33,000 |                           |   | -                                |   |                     |    |   |   | - |   |   | 34,091 |   |
|                                      |   |                        |   |                             |   |          |   |                            |   |                           |   |                             |   |                     |    |   |   |   |   |   |   |   |
| 2006                (paid by Predecessor) |   |                        |   |                             |   |          |   |                            |   |                           |   |                             |   |                     |    |   |   |   |   |   |   |   |
| Thomas                P. Rosato           |   |                        | 6,657  |                             |   | 12,105        |   |                            | -      |                           |   | 14,801                           |   |                     | -       |   |   | - |   |   | 33,563 |   |
| Gerald                J. Gallagher        |   |                        | 6,115  |                             |   | 25,941        |   |                            | -      |                           |   | 16,654                           |   |                     | -       |   |   | - |   |   | 48,710 |   |

| (1)    |   | We                  offer employees a 401(k) matching contribution up to 50% of the                  first 6%                  of an employee’s compensation contributed to our 401(k) Plan. These                  amounts reflect Company contributions to the employee account under                  the                  matching program. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                  |
| (2)    |   | We                  reimbursed golf club memberships not exclusively used for business                  entertainment.                                                                                                                                                                                                                                |
|   |   |                                                                                                                                                                                                                                                                                                                                                  |
| (3)    |   | Per                  their respective employment agreements, Mr. Rosato and Mr. Weiss                  each                  received $3,000 per month for the reimbursement of the cost associated                  with separately maintaining their own office.                                                                                    |
|   |   |                                                                                                                                                                                                                                                                                                                                                  |
| (4)    |   | Reflects                  reimbursement for automobile and associated costs not exclusively                  used for                  business.                                                                                                                                                                                                      |
|   |   |                                                                                                                                                                                                                                                                                                                                                  |
| (5)    |   | Represents                  interest paid on our convertible, promissory notes issued to Mr.                  Rosato                  and Mr. Gallagher in conjunction with our purchase of TSS/Vortech.                  The                  notes bear interest at 6% per annum.                                                                   |
|   |   |                                                                                                                                                                                                                                                                                                                                                  |
| (6)    |   | We paid                  premiums for a supplemental long-term disability policy on behalf                  of Mr.                  Gallagher.                                                                                                                                                                                                   |

**Grants      of Plan-Based Awards **

|                          |   |            |           | Stock Awards     |   |
|-------------------------------|--------|-----------------|----------------|-----------------------|--------|
|                          |   |            |           | Restricted Stock |   | Grant Date |   |
|                          |   |            |           | Granted               |   | Fair Value of Stock |   |
| Name                          |   | Grant Date |           | (#)                   |   | ($) |   |
|                          |   |            |           |                  |   |   |   |
| Timothy                C. Dec |   |            | 9/7/2007  |                  |   | 40,000 |   |   | 239,600 |   |
|                          |   |            | 9/7/2007  |                  |   | 40,000 |   |   | 239,600 |   |

**Outstanding      Equity Awards at 2007 Fiscal Year End**

|                            |   |            |              |                                                           |   |
|---------------------------------|--------|-----------------|-------------------|----------------------------------------------------------------|--------|
|                            |   |            |              |                                                           |   | Market Value |   |
|                            |   |            |              | Number of                                                 |   | of Shares of |   |
| Name                            |   | Grant Date |              | Shares thatHave not                  Vested (#) |   | Stock that                  Have Not                    Vested ($) |   |
|                            |   |            |              |                                                           |   |   |   |
| Timothy                  C. Dec |   |            | 9/7/2007 (1) |                                                           |   | 40,000 |   | $ | 194,000 |   |
|                            |   |            | 9/7/2007 (2) |                                                           |   | 40,000 |   |   | 194,000 |   |

|  | (1) | Shares                vest 50% at 18 months from the grant date and the remaining 50% vest                at 36                months from the grant date. |
|--|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | (2) | Shares                vest based on specific performance targets established by the Board.                The                market value of the stock awards is determined by multiplying the                number                of shares times $4.85, the closing price of our common stock on the                Nasdaq                Capital Market on December 31, 2007, the last day of our fiscal                year. |
|--|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**Stock      Vested in 2007**

**Pension      Benefits **

**Nonqualified      Deferred Compensation **

**Employment      Agreements**

*Employment      Agreement with Thomas P. Rosato*

*Share      performance bonus*

|  | · | if                  the highest average share price of our shares of 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 our shares of 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 our shares of 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 shares of 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. |
|--|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

*Employment      Agreement with Gerard J. Gallagher*

*Employment      Agreement with Timothy C. Dec*

*Employment      Agreement with Harvey L. Weiss*

----

**Executive      2007 Performance and Compensation Review**

**Potential      Payments Upon Termination or Change-in-Control**

*Termination        by the Company for reasons other than “Cause” or by the Executive for“Good        Reason”. *

|                                                       |   |                             |    | Health                         |   | Restricted                   |   |     |    |
|------------------------------------------------------------|--------|----------------------------------|---------|--------------------------------|--------|------------------------------|--------|----------|---------|
|                                                       |   | Severance                    ($) |    | Care                    ($)(4) |   | Stock                    ($) |   | Total($) |    |
| Thomas                    P. Rosato                    (1) |   |                             | 873,288 |                           |   | 4,476                        |   |     | -       |   |   | 877,764 |   |
| Gerald                    J. Gallagher (1)                 |   |                             | 873,288 |                           |   | 6,074                        |   |     | -       |   |   | 879,362 |   |
| Timothy                    C. Dec (2)                      |   |                             | 225,000 |                           |   | 6,074                        |   |     | 388,000 |   |   | 619,074 |   |
| Harvey                    L. Weiss (3)                     |   |                             | 410,959 |                           |   | 4,476                        |   |     | -       |   |   | 415,435 |   |

|   | (1)  | Per                  their respective employment agreement, each of Mr. Rosato and Mr.                  Gallagher is entitled to receive base compensation as and when                  it would                  otherwise payable if his employment had not been terminated from                  the date                  of termination through January 19, 2010, the expiration date of                  the                  employment period. If the termination occurs during the last twelve                  months                  of their employment, then the executive shall be entitled to receive                  amounts equal to his base compensation (as and on terms otherwise                  payable)                  for twelve months from the date of termination. |
|--------|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2)  | Per                  his employment agreement, Mr. Dec is entitled to amounts equal                  to his base                  compensation (as and on terms otherwise payable) for 12 months                  from the                  date of termination. Mr. Dec’s restricted stock award is valued at $4.85                  per share based on our closing stock price at December 31,                  2007. |
|--------|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3)  | Per                  his employment agreement, Mr. Weiss is entitled to receive base                  compensation as and when it would otherwise payable if his employment                  had                  not been terminated from the date of termination through January                  19, 2010,                  the expiration date of the employment period. If the termination                  occurs                  during the last 24 months of his employment, then the executive                  shall be                  entitled to receive amounts equal to base compensation (as and                  on terms                  otherwise payable) for 24 months from the date of termination. |
|--------|-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (4)  | Per                  their respective employment agreements, each of Mr. Rosato, Mr.                  Gallagher,                  Mr. Dec and Mr. Weiss is entitled to the reimbursement of a portion                  of any                  elected COBRA coverage for twelve months from the date of termination.                  We                  will pay a percentage of the premium for such COBRA health coverage                  equal                  to the percentage of the premium for health insurance coverage                  paid by the                  Company on the date of termination. |
|--------|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Compensation      Committee Interlocks and Insider Participation **

**Non-Employee      Director Compensation**

----

|                                  |   |                                    |    |               |   | All                   |   |   |    |
|---------------------------------------|--------|-----------------------------------------|---------|--------------------|--------|-----------------------|--------|--------|---------|
|                                  |   | Fees Earned                        |    | Stock              |   | Other                 |   | Total  |    |
| Name                                  |   | or Paid in Cash ($) |    | Awards ($)(1) |   | Compensation ($) |   | ($)    |    |
|                                  |   |                                    |    |               |   |                  |   |   |    |
| Asa                Hutchinson         |   | $                                       | 57,000  |               | $      | 28,658                |   | $      | -       |   | $ | 85,658 |   |
| William                L. Jews        |   |                                    | 29,000  |               |   | 50,881                |   |   | -       |   |   | 79,881 |   |
| C.                Thomas McMillen (2) |   |                                    | -       |               |   | -                     |   |   | 200,000 |   |   | 200,000 |   |
| David                J. Mitchell      |   |                                    | 57,000  |               |   | 28,658                |   |   | -       |   |   | 85,658 |   |
| John                Morton, III       |   |                                    | 75,000  |               |   | 50,881                |   |   | -       |   |   | 125,881 |   |
| Donald                L. Nickles      |   |                                    | 52,000  |               |   | 28,658                |   |   | -       |   |   | 80,658 |   |
|                                  |   |                                    |    |               |   |                  |   |   |    |   |   |   |   |
| Total                                 |   | $                                       | 270,000 |               | $      | 187,736               |   | $      | 200,000 |   | $ | 657,736 |   |

| (1) | This                column represents the dollar amount recognized as compensation expenses                for financial statement reporting purposes with respect to the referenced                fiscal year for the fair value of restricted stock granted in that                fiscal                year. These values have been calculated in accordance with SFAS 123R                using                the closing price of our common stock on the grant date. Pursuant                to SEC                rules, the amounts shown exclude the effect of estimated forfeitures                related to service-based vesting conditions. The amounts in this                column                reflect our accounting expense for these awards, and may not correspond                to                the actual value that will be recognized by the director. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)  | Represents                fees earned under the consulting agreement between us and the Washington                Capital Advisors, LLC, which is principally owned and managed by                Mr.                McMillen. See description of the consulting agreement below under                the                caption “Related                Party Transactions.” |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                             |   |            |   | Stock Awards     |   |
|----------------------------------|--------|-----------------|--------|-----------------------|--------|
|                             |   |            |   | Restricted Stock |   | Grant Date |   |
|                             |   |            |   | Granted               |   | Fair Value of Stock |   |
| Name                             |   | Grant Date |   | (#)                   |   | ($) |   |
|                             |   |            |   |                  |   |   |   |
| Asa                Hutchinson    |   | 5/1/2007        |   |                  | 10,000 |   | $ | 54,300 |   |
| William                L. Jews   |   | 5/1/2007        |   |                  | 18,416 |   |   | 100,000 |   |
|                             |   |  5/1/2007  |   |                  | 10,000 |   |   | 54,300 |   |
| David                J. Mitchell |   | 5/1/2007        |   |                  | 10,000 |   |   | 54,300 |   |
| John                Morton, III  |   | 5/1/2007        |   |                  | 18,416 |   |   | 100,000 |   |
|                             |   |  5/1/2007  |   |                  | 10,000 |   |   | 54,300 |   |
| Donald                L. Nickles |   | 5/1/2007        |   |                  | 10,000 |   |   | 54,300 |   |

**Potential        Payments upon Death, Disability or Termination **

*Termination        due to either Death, Disability, or by the Company for reasons other than        “Cause” or upon a “Change of Control” *

|                                  |   |            |    |                            |   |     |   |
|---------------------------------------|--------|-----------------|---------|---------------------------------|--------|----------|--------|
|                                  |   |            |    | Restricted                      |   |     |   |
|                                  |   | Severance($)(1) |    | Stock($)                    (2) |   | Total($) |   |
| Asa                    Hutchinson     |   |            | -       |                            |   | 32,333   |   |   | 32,333 |   |
| William                    L. Jews    |   |            | -       |                            |   | 121,652  |   |   | 121,652 |   |
| C.                    Thomas McMillen |   |            | 410,959 |                            |   | -        |   |   | 410,959 |   |
| David                    J. Mitchell  |   |            | -       |                            |   | 32,333   |   |   | 32,333 |   |
| John                    Morton, III   |   |            | -       |                            |   | 121,652  |   |   | 121,652 |   |
| Donald                    L. Nickles  |   |            | -       |                            |   | 32,333   |   |   | 32,333 |   |

|   | (1) | Per                  his consulting agreement, Mr. McMillen is entitled to receive base                  compensation as and when it would otherwise payable if his employment                  had                  not been terminated from the date of termination through January                  19, 2010,                  the expiration date of the employment period. If the termination                  occurs                  during the last twelve months of his employment, then the executive                  shall                  be entitled to receive amounts equal to base compensation (as and                  on terms                  otherwise payable) for twelve months from the date of                  termination. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | The                  restricted stock value is valued at $4.85 per share based on our                  closing                  stock price at December 31, 2007. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| **Item              12.** | **SECURITY                OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED                STOCKHOLDER MATTERS** |
|---------------------------|----------------------------------------------------------------------------------------------------------------------------------|

| *Directors                and Executive Officers*                                                                               |   | BeneficiallyOwned |            | Ownership |   |
|---------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|-----------------|-----------|--------|
|                                                                                                                            |   |              |            |      |   |
| C.                Thomas McMillen (1)                                                                                           |   |              | 575,000         |      |   | 4.8 | % |
| Harvey                L. Weiss (2)                                                                                              |   |              | 1,070,000       |      |   | 8.5 | % |
| Thomas                P. Rosato (3)                                                                                             |   |              | 2,203,823       |      |   | 17.8 | % |
| Timothy                C. Dec (4)                                                                                               |   |              | 80,000          |      |   | * |   |
| Gerard                J. Gallagher                                                                                              |   |              | 1,221,433       |      |   | 10.1 | % |
| David                J. Mitchell(5)                                                                                             |   |              | 160,000         |      |   | 1.3 | % |
| Donald                L. Nickles(6)                                                                                             |   |              | 210,000         |      |   | 1.7 | % |
| John                Morton, III(7)                                                                                              |   |              | 28,416          |      |   | * |   |
| Asa                Hutchinson(8)                                                                                                |   |              | 210,000         |      |   | 1.7 | % |
| William                L. Jews(9)                                                                                               |   |              | 28,416          |      |   | * |   |
| All                directors and offices combined as a group (10 persons)                (10)                                   |   |              | 5,787,088       |      |   | 45.1 | % |
|                                                                                                                            |   |              |            |      |   |   |   |
| *5%                Stockholders*                                                                                                |   |              |            |      |   |   |   |
|                                                                                                                            |   |              |            |      |   |   |   |
| Hummingbird                Management, LLC, Hummingbird Capital, LLC, and Hummingbird                Concentrated Fund, LP (11) |   |              | 1,482,241       |      |   | 12.2 | %  |
| Paul                D. Sonkin (12)                                                                                              |   |              | 1,902,641       |      |   | 15.1 | %  |
| Wellington                Management Company, LLP (13)                                                                          |   |              | 1,725,600       |      |   | 14.3 | % |
| The              Pinnacle Fund, L.P. (14)                                                                                       |   |              |  1,847,500 |      |   | 14.6 | %  |
| Robert              I. Green (15)                                                                                               |   |              | 1,735,000       |      |   | 12.6 | % |
| Southwell              Partners, L.P. (16)                                                                                      |   |              | 795,000         |      |   |  6.6 | %  |

----

| *    | Represents                      beneficial ownership of less than 1% of the outstanding shares                      of our                      common stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)  | Includes                      575,000 shares held by Washington Capital Advisors, LLC, of                      which Mr.                      McMillen is the chief executive officer and the sole owner.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| (2)  | Includes                      452,000 shares of common stock issuable upon the exercise of                      warrants held                      by Mr. Weiss.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (3)  | Includes                      294,870 shares of common stock issuable upon the exercise of                      warrants held                      by Mr. Rosato.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| (4)  | Includes                      80,000 shares of restricted common stock which are subject                      to                      forfeiture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| (5)  | Includes                      3,333 shares of restricted common stock, the restrictions on                      which will                      lapse within 60 days of March 31, 2008, and 3,333 shares of                      unvested                      restricted common stock which are subject to                      forfeiture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (6)  | Includes                      3,333 shares of restricted common stock, the restrictions on                      which will                      lapse within 60 days of March 31, 2008, and 3,333 shares of                      unvested                      restricted common stock which are subject to                      forfeiture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (7)  | Includes                      9,472 shares of restricted common stock, the restrictions on                      which will                      lapse within 60 days of March 31, 2008, and 15,611 shares of                      unvested                      restricted common stock which are subject to                      forfeiture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| (8)  | Includes                      3,333 shares of restricted common stock, the restrictions on                      which will                      lapse within 60 days of March 13, 2008, and 3,333 shares of                      unvested                      restricted common stock which are subject to                      forfeiture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| (9)  | Includes                      9,472 shares of restricted common stock, the restrictions on                      which will                      lapse within 60 days of March 31, 2008, and 15,611 shares of                      unvested                      restricted common stock which are subject to                      forfeiture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| (10) | Includes                      746,870 shares of common stock issuable upon the exercise of                      warrants,                      28,943 shares of restricted common stock, the restrictions                      on which will                      lapse within 60 days of March 31, 2008, and 121,221 shares                      of unvested                      restricted common stock subject to forfeiture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| (11) | Derived                      from a Schedule 13D/A and Form 4 filed on January 26, 2007                      and March 20,                      2008, respectively, by Paul D. Sonkin, The Hummingbird Value                      Fund, LP                      (“HVF”), The Hummingbird Microcap Value Fund, LP (“Microcap Fund”), The                      Hummingbird Concentrated Fund, LP (“Concentrated Fund”), Hummingbird                      Management, LLC (“Hummingbird”) and Hummingbird Capital, LLC (“Hummingbird                      Capital”). HVF, Microcap Fund and Concentrated Fund are the beneficial                      owner of 305,864, 378,733 and 702,644 shares of our common                      stock,                      respectively. Concentrated Fund is also the beneficial owner                      of an                      additional 95,000 shares of common stock issuable upon the                      exercise of                      warrants. Concentrated Fund Holdings were determined from a                      Form 4 filed                      on March 20, 2008, by Paul Sonkin. Hummingbird is the investment                      manager                      of HVF, Microcap Fund and Concentrated Fund and may be deemed                      to have the                      sole voting and investment authority over the shares owned                      by such                      entities. Hummingbird Capital, as the general partner of each                      of HVF,                      Microcap Fund and Concentrated Fund, may also be deemed to                      have the sole                      voting and investment authority over the shares owned by HVF,                      Microcap                      Fund and Concentrated Fund. Hummingbird and Hummingbird Capital                      disclaim                      any beneficial ownership of such shares. The business address                      of Mr.                      Sonkin and the foregoing Hummingbird entities is 460 Park Avenue,                      12th                      Floor, New York, New York 10022. |
| (12) | Includes                      392,000 shares of common stock issuable upon the exercise of                      warrants held                      in Mr. Sonkin’s and Mrs. Sonkin's IRA accounts and an additional 28,400                      shares of common stock issuable upon the exercise of warrants                      held in IRA                      accounts of various other parties for which Mr. Sonkin has                      dispositive                      power and for which Mr. Sonkin disclaims beneficial ownership.                      As the                      managing member and control person of Hummingbird, Mr. Sonkin                      may also be                      deemed to have the sole voting and investment authority over                      the shares                      beneficially owned by Hummingbird. Mr. Sonkin disclaims any                      beneficial                      ownership of such shares, except by pecuniary interest in the                      392,000                      warrants owned by him and his wife personally.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (13) | Derived                      from a Schedule 13G/A filed by Wellington Management Company,                      LLP                      (“Wellington”) on February 14, 2008. Wellington, in its capacity as an                      investment advisor, may be deemed to beneficially own 1,725,600                      shares of                      common stock which are held of record by clients of Wellington.                      Those                      clients have the right to receive, or the power to direct the                      receipt of,                      dividends from, or the proceeds from the sale of, such securities.                      No such                      client is known to have such right or power with respect to                      more than five                      percent of our common stock. Wellington has shared voting control                      over                      1,092,400 shares of common stock and shared investment control                      over                      1,725,600 shares of common stock. Wellington’s business address is 75                      State Street, Boston, MA 02109.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| (14) | Derived                      from a Schedule 13G/A filed jointly by The Pinnacle Fund, L.P.                      (Pinnacle)                      and Barry Kitt (collectively “Reporting Persons”) on February 13, 2008.                      The ownership includes 539,700 shares of common stock issuable                      upon the                      exercise of warrants. Pinnacle Advisers, L.P. (“Advisers”) is the general                      partner of Pinnacle. Pinnacle Fund Management, LLC (“Management”) is the                      general partner of Advisers. Mr. Kitt is the sole member of                      Management.                      Mr. Kitt may be deemed to be the beneficial owner of the shares                      of Common                      Stock beneficially owned by Pinnacle. Mr. Kitt expressly disclaims                      beneficial ownership of all shares of Common Stock beneficially                      owned by                      Pinnacle. The principal business office of the reporting persons                      is 4965                      Preston Park Blvd., Suite 240, Plano, TX 75093.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| (15) | Derived                      from a Schedule 13D filed by Robert I. Green on January 26,                      2007. Includes                      1,735,000 shares of common stock issuable upon exercise of                      warrants                      beneficially owned by Mr. Green. Of such shares, 1,485,000                      shares of                      common stock issuable upon the exercise of warrants are held                      by Starwood                      Group L.P. and 250,000 shares of common stock issuable upon                      the exercise                      of warrants are held by an individual retirement account for                      the benefit                      of Mr. Green. Mr. Green is the general partner of Starwood                      Group L.P. The                      business address of Mr. Green is 150 Bears Club Drive, Jupiter,                      Florida                      33477.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| (16) | Derived                      from a Schedule 13G/A filed jointly by Southwell Partners,                      L.P., Southwell                      Management, L.P., Southwell Holdings, LLC, and Wilson S. Jaeggli                      on                      February 12, 2008. Southwell is the general partner of Southwell                      Partners                      and may be deemed to befiecially own securities owedn and or                      held by                      and/or for the account and/or benefit of Southwell Partners.                      Southwell                      Holdings is the general partner of Southwell Management and                      may be deemed                      to beneficially own securities owned and/or held by and/or                      for the account                      and/or benefit of Soutwehll Management. Mr. Jaeggli is the                      managing                      director of Southwell Holdigns and may be deemed to beneficially                      own                      securities owned and/or held by and/or for the account and/or                      benefit of                      Southwell Holdings. The principal business office of each f                      the reporting                      persons is 1901 North Akard, 2nd Floor, Dallas, TX                      75201.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

----

**Equity      Compensation Plan Information**

** **

|                                                                      |   |                                  |    | Weighted-               |   | Number of securities |               |
|---------------------------------------------------------------------------|--------|---------------------------------------|---------|-------------------------|--------|--------------------------------|--------------------|
|                                                                      |   | Number of                        |    | average                 |   | remaining available       |               |
|                                                                      |   | securities to be            |    | fair market        |   | for future issuance  |               |
|                                                                      |   | issued upon vesting of |    | value on           |   | under equity              |               |
| Plan Category                                                        |   | restricted stock                 |    | date of grant |   | compensation plans        |               |
|                                                                      |   |                                  |    |                    |   |                           |               |
| Equity                compensation plans approved by stockholders (1)     |   |                                  | 970,832 | (3)           | $      | 5.47                           |               |   | 1,129,168 |   |
| Equity                compensation plans not approved by stockholders (2) |   |                                  | -       |                    |   | -                              |               |   | - |   |
| Total                                                                     |   |                                  | 970,832 |                    | $      | 5.47                           |     |   | 1,129,168 |   |

** **

**Summary      Description of the Company’s Non-Stockholder Approved Equity Compensation      Plans**

| **Item              13.** | **CERTAIN                RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR                INDEPENDENCE** |
|---------------------------|-------------------------------------------------------------------------------------------------------------|

**Related      Party Transactions**

*Convertible      Note Repayment*

----

*Prior      Share Issuances*

| **Name**                                            |   | **Number of****Shares** |    |
|-----------------------------------------------------|--------|------------------------------|---------|
| Washington                Capital Advisors, LLC     |   |                         | 575,000 |   |
| Harvey                L. Weiss                      |   |                         | 575,000 |   |
| David                J. Mitchell                    |   |                         | 150,000 |   |
| Donald                L. Nickles                    |   |                         | 200,000 |   |
| Asa                Hutchinson                       |   |                         | 200,000 |   |
| Paladin                Homeland Security Fund, L.P. |   |                         | 24,765  |   |
| Paladin                Homeland Security Fund, L.P. |   |                         | 15,926  |   |
| Paladin                Homeland Security Fund, L.P. |   |                         | 5,553   |   |
| Paladin                Homeland Security Fund, L.P. |   |                         | 3,756   |   |

*Registration      Rights*

*Washington      Capital Advisors, LLC*

*Consulting      Agreement with C. Thomas McMillen*

----

**S3      Integration L.L.C.**

**Chesapeake      Systems, L.L.C.**

**Chesapeake      Mission Critical, L.L.C.**

**Chesapeake      Tower Systems, Inc**

**CTS      Services, L.L.C.**

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

**Telco      P&C, L.L.C.**

**Automotive      Technologies, Inc.**

**TPR      Group Re Three, L.L.C.**

----

|                                                             |    | **Year Ended****December 31,****2007** |      |
|------------------------------------------------------------------|--------------|--------------------------------------------------|-----------|
| **Revenue**                                                      |         |                                             |      |   |
| CTS                Services, L.L.C.                              |         | $                                                | 183,532   |   |
| Chesapeake                Systems, L.L.C.                        |         |                                             | 105,965   |   |
| Chesapeake                Mission Critical, L.L.C.               |         |                                             | 106,627   |   |
| **Total**                                                        |         | $                                                | 396,124   |   |
|                                                             |         |                                             |      |   |
| **Cost                of Revenue**                               |         |                                             |      |   |
| CTS                Services, L.L.C.                              |         | $                                                | 3,439,631 |   |
| Chesapeake                Systems, L.L.C.                        |         |                                             | 161,178   |   |
| Chesapeake                Mission Critical, L.L.C.               |         |                                             | 144,924   |   |
| Chesapeake                Tower Systems, Inc.                    |         |                                             | 1,052     |   |
| S3                Integration, L.L.C.                            |         |                                             | 267,848   |   |
| LH                Cranston & Sons, Inc.                      |         |                                             | 234,252   |   |
| Telco                P&C, L.L.C.                             |         |                                             | 29,174    |   |
| **Total**                                                        |         | $                                                | 4,278,059 |   |
|                                                             |         |                                             |      |   |
| **Selling,                general and administrative**           |         |                                             |      |   |
| Office                rent paid on Chesapeake sublease agreement |         |                                             | 207,671   |   |
| Office                rent paid to TPR Group Re Three, L.L.C.    |         |                                             | 384,271   |   |
| Vehicle                repairs to Automotive Technologies, Inc.  |         |                                             | 4,442     |   |
| **Total**                                                        |         | $                                                | 596,384   |   |

----

|                                                    |    | **December 31,****2007** |       |
|----------------------------------------------------|--------------|-------------------------------|------------|
| **Accounts                receivable/(payable):**  |         |                          |       |   |
| CTS                Services, L.L.C.                |         | $                             | 44,821     |   |
| CTS                Services, L.L.C.                |         |                          | (2,969,671 | ) |
| Chesapeake                Systems, L.L.C.          |         |                          | 611        |   |
| Chesapeake                Systems, L.L.C.          |         |                          | (873       | ) |
| Chesapeake                Mission Critical, L.L.C. |         |                          | 104,397    |   |
| Chesapeake                Mission Critical, L.L.C. |         |                          | (18,950    | ) |
| Telco                P&C, L.L.C.               |         |                          | (8,000     | ) |
| LH                Cranston & Sons, Inc.        |         |                          | (11,575    | ) |
| S3                Integration, L.L.C.              |         |                          | (60,556    | ) |
| **Total                Accounts receivable**       |         | $                             | 149,829    |   |
|                                               |         |                          |       |   |
| **Total                Accounts (payable)**        |         | $                             | (3,069,625 | ) |

**Director      Independence **

| **Item              14.** | **PRINCIPAL                ACCOUNTING FEES AND                SERVICES** |
|---------------------------|--------------------------------------------------------------------------|

**Audit      and Non-Audit Fees**

|                                     |   | **2006** |   | **2007** |   |
|------------------------------------------|--------|----------|--------|----------|--------|
| Audit                fees           |   | $        | 38,000 |     | $      | 240,130 |   |
| Audit-related                fees   |   |     | 17,786 |     |   | 52,775 |   |
| Tax                fees             |   |     | 2,612  |     |   | 6,000 |   |
| All                other fees       |   |     | -      |     |   | - |   |
| Total                                    |   | $        | 58,398 |     | $      | 298,905 |   |

***Audit      Fees***

----

***Audit-Related      Fees***

***Tax      Fees***

***All      Other Fees***

**Policy      on Audit Committee Pre-Approval of Audit and Permissible Non-audit Services      of      Independent Auditors**

----

**PART      IV**

| **Item              15.** | **EXHIBITS** |
|---------------------------|--------------|

**Exhibits.**

| **Exhibit****Number**                                                                                        |                           | **Description**                                                                                                                                                                                                                                                                                                                                                                                      |
|--------------------------------------------------------------------------------------------------------------|--------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                    |                           |                                                                                                                                                                                                                                                                                                                                                                                                 |
| 3.1                                                                                                          |       | Second                Amended and Restated Certificate of Incorporation dated January 19,                2007 (previously filed with the Commission as Exhibit 3.1 to the                Current                Report on Form 8-K filed on January 25, 2007 and incorporated herein                by reference)                                                                          |
| 3.1.1                                                                                                        |                           | Amendment                to the Second Amended and Restated Certificate of Incorporation                (previously filed with the Commission as Exhibit A-1 to the Company’s                Definitive Proxy Statement filed on May 22, 2007 and incorporated                herein                by reference)                                                                              |
| 3.2                                                                                                          |                           | Amended                and Restated By-laws (previously filed with the Commission as Exhibit                4.2                to the Company’s Registration Statement on Form S-8 No. 333-142906, filed                on May 14, 2007 and incorporated herein by reference)                                                                                                                  |
| 4.1                                                                                                          |                           | Specimen                Unit Certificate (previously filed with the Commission as Exhibit                4.1 to                the Company’s Registration Statement on Form S-1 No. 333-123504, effective                July 13, 2005 and incorporated herein by                reference)                                                                                               |
| 4.2                                                                                                          |                           | Specimen                Common Stock Certificate (previously filed with the Commission as                Exhibit                4.2 to the Company’s Registration Statement on Form S-1 No. 333-123504,                effective July 13, 2005 and incorporated herein by                reference)                                                                                       |
| 4.3                                                                                                          |                           | Specimen                Warrant Certificate (previously filed with the Commission as Exhibit                4.3                to the Company’s Registration Statement on Form S-1 No. 333-123504,                effective July 13, 2005 and incorporated herein by                reference)                                                                                            |
| 4.4                                                                                                          |                           | Warrant                Agreement between Continental Stock Transfer & Trust Company and the                Company (previously filed with the Commission as Exhibit 4.4 to the                Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference)                                         |
| 4.4.1                                                                                                        |                           | Warrant                Clarification Agreement between Continental Stock Transfer & Trust                Company and the Company (previously filed with the Commission as                Exhibit                4.5 to the Company’s Quarterly Report on Form 10-QSB for the quarterly                period ended September 30, 2006 and incorporated herein by                reference) |
| 4.4.2                                                                                                        |                           | Warrant                Clarification Agreement No. 2 between Continental Stock Transfer&                Trust Company and the Company (previously filed with the Commission                as                Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December                14, 2006 and incorporated herein by reference)                                      |
| 4.5                                                                                                          |                           | Unit                Purchase Option (previously filed with the Commission as Exhibit                4.5 to                the Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference)                                                                                                             |
| 4.5.1                                                                                                        |                           | Amendment                to Unit Purchase Option (previously filed with the Commission as                Exhibit                4.6 to the Company’s Quarterly Report on Form 10-QSB for the quarterly                period ended September 30, 2006 and incorporated herein by                reference)                                                                                     |

----

| **Exhibit****Number** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|-----------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 4.5.2                 |   | Amendment                No. 2 to Unit Purchase Option (previously filed with the Commission                as                Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on December                14, 2006 and incorporated herein by reference)                                                                                                                                                                                                                                                                                                                           |
| 10.1                  |   | Second                Amended and Restated Membership Interest Purchase Agreement dated                July 31, 2006 among Fortress America Acquisition Corporation, VTC,                L.L.C., Vortech, L.L.C., Thomas P. Rosato and Gerard J. Gallagher,                and                Thomas P. Rosato as Members’ Representative (previously filed with the                Commission as Exhibit 10.1 to the Company’s Quarterly Report on Form                10-QSB for the quarterly period ended September 30, 2006 and incorporated                herein by reference) |
| 10.2                  |   | Amendment                to the Second Amended and Restated Membership Interest Purchase Agreement                dated January 16, 2007 among Fortress America Acquisition                Corporation, VTC, L.L.C., Vortech, L.L.C., Thomas P. Rosato and Gerard                J.                Gallagher, and Thomas P. Rosato as Members’ Representative (previously                filed with the Commission as Exhibit 10.1 to the Company’s Current Report                on Form 8-K filed on January 19, 2007 and incorporated herein by                reference)     |
| 10.3                  |   | Escrow                Agreement (Balance Sheet Escrow) dated January 19, 2007 among                Fortress America Acquisition Corporation, VTC, L.L.C., Vortech, L.L.C.,                Thomas P. Rosato and Gerard J. Gallagher, Thomas P. Rosato as Members’                Representative, and SunTrust Bank (previously filed with the Commission                as                Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on                January 25, 2007 and incorporated herein by                reference)                                  |
| 10.4                  |   | Escrow                Agreement (General Indemnity) among Fortress America Acquisition                Corporation, VTC, L.L.C., Vortech, L.L.C., Thomas P. Rosato and Gerard                J.                Gallagher, Thomas P. Rosato as Members’ Representative, and SunTrust Bank                (previously filed with the Commission as Exhibit 10.4 to the Company’s                Current Report on Form 8-K filed on January 25, 2007 and incorporated                herein by reference)                                                                                |
| 10.5                  |   | Registration                Rights Agreement among Fortress America Acquisition Corporation and                Thomas                P. Rosato and Gerard J. Gallagher (previously filed with the Commission                as                Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on                January 25, 2007 and incorporated herein by                reference)                                                                                                                                                                                        |
| 10.6                  |   | Fortress                America Acquisition Corporation 2006 Omnibus Incentive Compensation                Plan                (previously filed with the Commission as Exhibit E to the Company’s                Definitive Proxy Statement filed on December 27, 2006 and incorporated                herein by reference)                                                                                                                                                                                                                                                                     |
| 10.7                  |   | Employment                Agreement between Harvey L. Weiss and the Company, dated January 19,                2007 (previously filed with the Commission as Exhibit 10.7 to the                Company’s Current Report on Form 8-K filed on January 25, 2007 and                incorporated herein by reference)*                                                                                                                                                                                                                                                                    |
| 10.8                  |   | Executive                Consulting Agreement dated January 19, 2007 by Fortress America                Acquisition Corporation and Washington Capital Advisors, Inc. (previously                filed with the Commission as Exhibit 10.8 to the Company’s Current Report                on Form 8-K filed on January 25, 2007 and incorporated herein by                reference)                                                                                                                                                                                                   |
| 10.9                  |   | Executive                Employment Agreement dated January 19, 2007 by Fortress America                Acquisition Corporation and Thomas P. Rosato (previously filed with                the                Commission as Exhibit 10.9 to the Company’s Current Report on Form 8-K                filed on January 25, 2007 and incorporated herein by                reference)*                                                                                                                                                                                                    |
| 10.10                 |   | Executive                Employment Agreement dated January 19, 2007 by Fortress America                Acquisition Corporation and Gerard J. Gallagher (previously filed                with the                Commission as Exhibit 10.10 to the Company’s Current Report on Form 8-K                filed on January 25, 2007 and incorporated herein by                reference)*                                                                                                                                                                                                |
| 10.11                 |   | Voting                Agreement dated January 19, 2007 by Fortress America Acquisition                Corporation, Thomas P. Rosato, Gerard J. Gallagher, C. Thomas McMillen                and                Harvey L. Weiss (previously filed with the Commission as Exhibit                10.11 to                the Company’s Current Report on Form 8-K filed on January 25, 2007                and incorporated herein by reference)                                                                                                                                         |
| 10.12                 |   | Letter                Agreement among the Company, Sunrise Securities Corp. and C. Thomas                McMillen (previously filed with the Commission as Exhibit 10.1 to                the                Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference)                                                                                                                                                                                                                                |

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| **Exhibit****Number** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|-----------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.13                 |   | Letter                Agreement among the Company, Sunrise Securities Corp. and Harvey                L. Weiss                (previously filed with the Commission as Exhibit 10.2 to the Company’s                Annual Report on Form 10-KSB for the year ended December 31, 2005 and                incorporated herein by reference)                                                                                                                                                                                                                 |
| 10.14                 |   | Letter                Agreement among the Company, Sunrise Securities Corp. and David J.                Mitchell (previously filed with the Commission as Exhibit 10.3 to                the                Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference)                                                                                                                                                                                                |
| 10.15                 |   | Letter                Agreement among the Company, Sunrise Securities Corp. and Donald                L.                Nickles (previously filed with the Commission as Exhibit 10.4 to                the                Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference)                                                                                                                                                                                 |
| 10.16                 |   | Agreement                among the Company, Sunrise Securities Corp. and Paladin Homeland                Security                Fund, L.P., Paladin Homeland Security Fund (NY City), L.P., Paladin                Homeland Security Fund (CA), L.P. and Paladin Homeland Security Fund                (Cayman Islands), L.P. (previously filed with the Commission as Exhibit                10.5 to the Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference) |
| 10.17                 |   | Letter                Agreement among the Company, Sunrise Securities Corp. and Asa Hutchinson                (previously filed with the Commission as Exhibit 10.6 to the Company’s                Annual Report on Form 10-KSB for the year ended December 31, 2005 and                incorporated herein by reference)                                                                                                                                                                                                                                 |
| 10.18                 |   | Investment                Management Trust Agreement between Continental Stock Transfer & Trust                Company and the Company (previously filed with the Commission as                Exhibit                10.7 to the Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference)                                                                                                                                                                      |
| 10.19                 |   | Stock                Escrow Agreement between the Company, Continental Stock Transfer&                Trust Company and the Initial Stockholders (previously filed with                the                Commission as Exhibit 10.8 to the Company’s Annual Report on Form 10-KSB                for the year ended December 31, 2005 and incorporated herein by                reference)                                                                                                                                                            |
| 10.20                 |   | Registration                Rights Agreement among the Company and the Initial Stockholders                (previously filed with the Commission as Exhibit 10.9 to the Company’s                Annual Report on Form 10-KSB for the year ended December 31, 2005 and                incorporated herein by reference)                                                                                                                                                                                                                                    |
| 10.21                 |   | Warrant                Purchase Agreement between C. Thomas McMillen, Harvey L. Weiss and                Sunrise                Securities Corp. (previously filed with the Commission as Exhibit                10.10 to                the Company’s Annual Report on Form 10-KSB for the year ended                December 31, 2005 and incorporated herein by                reference)                                                                                                                                                               |
| 10.22                 |   | Letter                Agreement between the Company and Global Defense Corp. (previously                filed                with the Commission as Exhibit 10.11 to the Company’s Annual Report on                Form 10-KSB for the year ended December 31, 2005 and incorporated                herein by reference)                                                                                                                                                                                                                                   |
| 10.23                 |   | Agreement                and Plan of Merger among Fortress America Acquisition Corporation                and FAAC                Merger Corporation dated June 29, 2005 (previously filed with the                Commission as Exhibit 10.15 to the Company’s Registration Statement on                Form S-1 No. 333-123504, effective July 13, 2005 and incorporated                herein by reference)                                                                                                                                        |
| 10.24                 |   | Non-Employee                Director Compensation Policy (previously filed with the Commission                as                Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on                May 21, 2007 and incorporated herein by                reference)*                                                                                                                                                                                                                                                                        |
| 10.25                 |   | Form                of Restricted Stock Agreement (Employees Only) (previously filed                with the                Commission as Exhibit 10.2 to the Company’s Current Report on Form 8-K                filed on May 21, 2007 and incorporated herein by                reference)                                                                                                                                                                                                                                                               |
| 10.26                 |   | Executive                Employment Agreement, dated as of August 6, 2007, between Fortress                International Group, Inc. and Timothy C. Dec (previously filed with                the                Commission as Exhibit 10.1 to the Company’s Current Report on Form 8-K                filed on August 8, 2007 and incorporated herein by                reference)*                                                                                                                                                                            |

----

| **Exhibit****Number** |   | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|-----------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 10.27                 |   | Prepayment                Agreement, dated as of August 29, 2007, between Fortress International                Group, Inc. and Thomas P. Rosato (previously filed with the Commission                as                Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August                30, 2007 and incorporated herein by reference)*                                                                                                                                                                                      |
| 10.28                 |   | Stock                Purchase Agreement dated September 24, 2007 between Innovative Power                Systems Inc., the Stockholders of Innovative Power Systems Inc.,                Quality                Power Systems, Inc., the Stockholders of Quality Power Systems, Inc.,                and                the Company (previously filed with the Commission as Exhibit 10.1                to the                Company’s Current Report on Form 8-K filed on September 27, 2007 and                incorporated herein by reference) |
| 10.29†#         |   | Membership                Interest Purchase Agreement dated November 30, 2007 between Rubicon                Integration, L.L.C., each of the members of Rubicon and the Company                                                                                                                                                                                                                                                                                                                                                                           |
| 10.30                 |   | Stock                Purchase Agreement by and among SMLB, Ltd, the Stockholders of SMLB,                Ltd,                and the Company dated January 2, 2008 (previously filed with the                Commission as Exhibit 10.1 to the Company’s Current Report on Form 8-K                filed on January 1, 2008 and incorporated herein by                reference)                                                                                                                                                                     |
| 14.1                  |   | Code                of Ethics                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 21#                   |   | Significant                Subsidiaries of the Registrant                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 23.1#                 |   | Consent                of Grant Thornton LLP regarding Fortress International Group, Inc.                financial statements for the year ended December 31,                2007.                                                                                                                                                                                                                                                                                                                                                                         |
| 23.2#                 |   | Consent                of Grant Thornton LLP regarding Vortech L.L.C. and VTC L.L.C. financial                statements for the period ending January 1, 2007 through January                19,                2007.                                                                                                                                                                                                                                                                                                                                     |
| 23.3#                 |   | Consent                of Goldstein Golub Kessler LLP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 23.4#                 |   | Consent                of McGladrey & Pullen, LLP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 31.1                  |   | Certificate                of Fortress International Group, Inc. Principal Executive Officer                pursuant                to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                                       |
| 31.2                  |   | Certificate                of Fortress International Group, Inc. Principal Financial Officer                pursuant                to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                                       |
| 32.1#                 |   | Certificates                of Fortress International Group, Inc. Principal Executive Officer                and                Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley                Act of 2002                                                                                                                                                                                                                                                                                                                       |

| #       | Previously                filed with the Registrant’s Annual Report on Form 10-K for the year ended                December 31, 2007 filed on March 31, 2008.                                         |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *       | Management                contract or compensatory plan or arrangement.                                                                                                                                     |
| † | Confidential                treatment has been requested as to certain portions, which have been                filed                separately with the Securities and Exchange                Commission. |

----

**SIGNATURES**

**.**

|   |                          |   | **Fortress                International Group, Inc.** |
|--------|-------------------------------|--------|-------------------------------------------------------|
|   |                          |   |                                                  |   |
| Date:  | April                28, 2008 |   | By:                                                   | /s/                Thomas P. Rosato  |
|   |                          |   |                                                  | Thomas                P. Rosato |
|   |                          |   |                                                  | Chief                Executive Officer |
|   |                          |   |                                                  | *(Authorized                Officer and Principal Executive Officer)* |
|   |                          |   |                                                  |   |

| **Name**                            |   | **Position**                                        |   | **Date**                      |
|-------------------------------------|--------|-----------------------------------------------------|--------|-------------------------------|
|                                |   |                                                |   |                          |
|                                |   | Chief                Executive Officer and Director |   |                          |
| /s/                Thomas P. Rosato |   | (Principal                Executive Officer)        |   | April                28, 2008 |
| Thomas                P. Rosato     |   |                                                |   |                          |
|                                |   |                                                |   |                          |

| /s/                Harvey L. Weiss |   | Chairman                and Director |   | April                28, 2008 |
|------------------------------------|--------|--------------------------------------|--------|-------------------------------|
| Harvey                L. Weiss     |

| s/                Timothy C. Dec |   | Chief                Financial Officer                                        |   | April                28, 2008 |
|----------------------------------|--------|-------------------------------------------------------------------------------|--------|-------------------------------|
| Timothy                C. Dec    |   | (Principal                Financial Officer and Principal Accounting Officer) |
|                             |   |                                                                          |

| /s/                Gerard J. Gallagher |   | President                and Director |   | April                28, 2008 |
|----------------------------------------|--------|---------------------------------------|--------|-------------------------------|
| Gerard                J. Gallagher     |   |                                  |   |                          |
|                                   |   |                                  |   |                          |
| /s/                Asa Hutchinson      |   | Director                              |   | April                28, 2008 |
| Asa                Hutchinson          |   |                                  |   |                          |
|                                   |   |                                  |   |                          |
| /s/                William L. Jews     |   | Director                              |   | April                28, 2008 |
| William L.              Jews           |   |                                  |   |                          |
|                                   |   |                                  |   |                          |
| /s/                C. Thomas McMillen  |   | Director                              |   | April                28, 2008 |
| C.                Thomas McMillen      |   |                                  |   |                          |
|                                   |   |                                  |   |                          |
| /s/                David J. Mitchell   |   | Director                              |   | April                28, 2008 |
| David                J. Mitchell       |   |                                  |   |                          |
|                                   |   |                                  |   |                          |
| /s/                John Morton, III    |   | Director                              |   | April                28, 2008 |
| John                Morton, III        |   |                                  |   |                          |
|                                   |   |                                  |   |                          |
| /s/                Donald L. Nickles   |   | Director                              |   | April                28, 2008 |
| Donald                L. Nickles       |   |                                  |   |                          |
|                                   |   |                                  |   |                          |

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