Technest Holdings Engaged by the U.S. Army to Develop System to Optimize Unmanned Aerial Vehicle Performance Tracking

Company to Develop Revolutionary Real-Time Motion Tracking Indicator


BOSTON, Oct. 18, 2006 (PRIMEZONE) -- Technest Holdings, Inc. (OTCBB:TCNH), a defense and homeland security company, announced today that it was selected by the U.S. Army to develop and prototype a real-time motion tracking Video-Moving Target Indicator ("MTI") surveillance algorithm, SmartMTI.

The SmartMTI system will be able to successfully detect, extract and track the locations and movement history of multiple targets in real time within any image data.

Technest's design improvements to existing MTI technology include: random air vehicle motion mitigation; false alarm rate reduction; low bandwidth surveillance accuracy and efficiency; robust tracking of an unlimited number of targets; and, accurate target location.

The design of the SmartMTI uses a variety of mathematical models in a unique design that considers the "state" of the object and uses a combination of state-of-the-art motion detection and target tracking methods to improve tracking reliability.

"The SmartMTI design leverages our expertise and experience in developing real-time surveillance systems for the U.S. Army," stated Dr. Joseph P. Mackin, CEO of Technest Holdings. "The MTI technology, used in conjunction with our Smart Optical Sensor, offers strong commercial potential as a marketable product to enhance capabilities of unmanned aerial vehicles."

The project is based on a successful empirical Phase-I concept study, which demonstrated proof-of-concept design.

The contract states that Technest will perform further research and development to expand upon its existing Phase I exploratory research and evaluate commercialization potential of the SmartMTI. The total value of the two-year U.S. Army contract award is approximately $730,000 through September 2008.

About Technest Holdings, Inc.

Technest Holdings, Inc., in combination with its operating subsidiaries EOIR Technologies and Genex Technologies, is a provider of advanced remote sensor systems, chemical detectors, intelligent surveillance and advanced 3D imaging technology solutions to the defense and homeland security marketplaces. Technest is committed to setting next-generation standards in defense and security through the provision of innovative emerging technologies and expert services. Technest's solutions support military, law enforcement and homeland security personnel. Through strategic development, Technest focuses on the creation of dual-use technology and products with applications in both the defense market and civilian homeland security and law enforcement fields. For more information, please visit the company's website at http://www.technestholdings.com.

Technest Holdings, Inc. is a featured Company on http://www.HomelandDefenseStocks.com, a service for which Technest Holdings compensates the provider.

Investors are cautioned that certain statements contained in this press release are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). Forward-looking statements include statements which are predictive in nature, which depend upon or refer to future events or conditions, which include words such as "expects," "anticipates," "intends," "plans," "believes," "estimates," or similar expressions. In addition, any statements concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, applicability, benefit and use of our product and possible future actions, which may be provided by management, are also forward-looking statements as defined by the Act. Some of the factors that could significantly impact the forward-looking statements in this press release include, but are not limited to: the functionality of our product; a rejection of the Company's products and technologies by the marketplace; and disputes as to the Company's intellectual property rights. Forward-looking statements are based upon current expectations and projections about future events and are subject to risks, uncertainties, and assumptions about Technest Holdings, its products, economic and market factors and the industries in which Technest Holdings does business, among other things. These statements are not guarantees of future performance and Technest Holdings has no specific intention to update these statements. More detailed information about those factors is contained in Technest Holdings' filings with the Securities and Exchange Commission. http://www.sec.gov


            

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