1334303--3/31/2009--ICX_TECHNOLOGIES

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{customer, product, revenue}

{stock, price, operating}

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{property, intellectual, protect}

{product, market, service}

{control, financial, internal}

{acquisition, growth, future}

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{investment, property, distribution}

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{operation, international, foreign}

{personnel, key, retain}

{competitive, industry, competition}

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{financial, litigation, operation}

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{cost, contract, operation}

Risks Related to Our Operations and Corporate Structure Our future performance may be difficult to predict due to the nature of our business. Our business depends on the development of markets for detection and surveillance products and solutions. A substantial portion of our revenues depends on sales to the U.S. government and could be affected by changes in federal funding levels. We rely in part on original equipment manufacturers (OEMs) and distribution partners to sell some of our products, and we may be adversely affected if those parties do not actively promote our products or pursue installations that use our products. A substantial portion of our revenues depends on sales to prime contractors and system integrators. If we do not successfully expand our direct sales and service organizations and partnering arrangements, we may not be able to increase our sales or adequately support our customers. The lengthy sales cycles of our products may cause our revenues to fluctuate substantially. We compete against companies that have longer operating histories, more established products and greater resources. Our ability to compete depends on our ability to innovate successfully and quickly. Some of our customers and operations are located outside of the United States, which subjects us to additional international risks. Our business has inherent operational risks that cannot be adequately covered by insurance or indemnity, and our products and technologies may not qualify for protection under the SAFETY Act. We have incurred operating losses since our inception and as a result we may not achieve or sustain profitability. A number of other factors may cause our consolidated operating results to fluctuate on a quarterly or annual basis, which may make it difficult to predict our future operating results. We may have difficulty scaling production to large volumes. If we are unable to meet demand or efficiently increase production, customers may turn to products offered by competitors and our operating results could be harmed. We purchase certain component parts from a limited number of third-party suppliers, and are therefore subject to limitations in supply which could result in delays of product shipments and damage our business and operating results. Our ability to operate and grow our business effectively will depend on retaining key employees and management, and hiring skilled and experienced personnel. If we lose the services of any key personnel or are unable to hire additional personnel, our business could be harmed. Several of our officers and directors may have divided responsibilities which could divert management time and create potential conflicts of interest. Wexford Capital, LLC and its affiliates, our principal stockholders, beneficially own and control a significant amount of our common stock, giving them substantial influence over our corporate transactions and other matters. Their interests may conflict with yours, and the concentration of ownership of our common stock will limit your influence and the influence of our other stockholders. We may divest assets to reflect changes in our strategy. Our strategy for future acquisitions may be costly to implement and difficult to manage. We may have difficulty integrating our businesses. If we fail to maintain an accurate system of internal controls, we may not be able to accurately report our financial results, which could adversely affect our stock price. Our ability to use net operating losses to offset future taxable income may be subject to certain limitations. We may not realize the full amount of revenues reflected in our backlog, which could harm our operations and significantly reduce our future revenues. Our success and competitive position depend significantly on our ability to obtain and protect intellectual property. Failure to protect our intellectual property rights would impair our ability to compete effectively and defend ourselves from any third party claims that we are infringing others intellectual property rights. The U.S. government s right to use technology developed by us limits our intellectual property rights. Our efforts to protect our intellectual property may be less effective in some foreign countries where intellectual property rights are not as well protected as in the United States. Our business is subject to environmental regulation that could result in compliance costs. Any violations or liability under environmental laws could harm our business. The nature of our business may subject us to the risk of litigation. Our plans for financing are subject to the uncertain condition of financial markets. A portion of our business depends on the availability of performance and payment bonds. Recent economic developments may adversely affect our business, financial condition and results of operations Risks Associated with Government Contracts and Regulation The U.S. government may terminate or modify its existing contracts with us or with government contractors for which we are a subcontractor. Our business is subject to laws and regulations that are more restrictive because we are a contractor and subcontractor to the U.S. government. We may not be able to receive or retain the necessary licenses or authorizations required for us to export our products and we may incur regulatory penalties for past compliance failings of our acquired companies. We are subject to audits by the U.S. government which could adversely affect our business. Our business may increasingly depend upon obtaining and maintaining required security clearances. Cost over-runs on our contracts could subject us to losses or adversely affect our future business. Risks Related to Our Common Stock The price of our common stock may be volatile and we cannot assure you that the price of our shares will not decline. Future sales of our common stock by our stockholders could depress the price of our common stock. We currently do not intend to pay dividends on our common stock, and as a result, the only opportunity to achieve a return on an investment in our common stock is if the price appreciates. Our organizational documents and Delaware law have anti-takeover provisions that could delay or prevent a change in control of our company.

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1334303--3/31/2009--ICX_TECHNOLOGIES_INC