X0202 3 2005-02-14 0 0001077800 TECHNEST HOLDINGS INC THNS 0001102833 MARKLAND TECHNOLOGIES INC 54 DANBURY ROAD, #207 RIDGEFIELD CT 06877 0 0 1 0 Common Stock 412650577 D Common Stock Purchase Warrants .0307 2005-02-14 2010-02-14 Common Stock 30341954 I See footnote Series C Convertible Preferred Stock 2005-02-14 Common Stock 30341954 I See footnote Shares owned by ipPartners, Inc., a Rhode Island corporation. Robert Tarini, our Chairman and Chief Executive Officer, may be deemed to be the beneficial owner of the shares of ipPartners, Inc., being that he is a majority stockholder of ipPartners, Inc. With regard to all shares owned by ipPartners and Mr. Tarini, dispositive and voting power may be deemed to be shared with Markland Technologies, Inc.. ipPartners purchased the warrants and Series C Preferred Stock as part of an investment unit. For each investment unit ipPartners, Inc. continues to hold on February 14, 2006, Technest will issue to the Investor a number of shares of common stock calculated in accordance with the following formula: ((Units Held on Reset Date) x [(Adjustment Price) - Combined Market Price)]) /THNS Market Price "ADJUSTMENT PRICE" shall mean $6.525 (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization affecting such shares) "COMBINED MARKET PRICE" shall mean the THNS Market Price added to the MRKL Market Price. "MRKL MARKET PRICE" shall mean the average of the closing bid prices of the Markland common stock during the period beginning ten (10) trading days prior to the reset date and ending ten (10) trading days after the reset date as reported by the OTC Bulletin Board or any similar organization or agency of national 1 for 211.18 Not applicable /s/ Robert Tarini 2005-02-24