SEC FORM 4

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person^*

SARGENT HENRY B III

(Last)

(First)

(Middle)

10411 MOTOR CITY DRIVE, SUITE 650

(Street)

BETHESDA

20817

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
TECHNEST HOLDINGS INC [ TCNH ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

X	Director	10% Owner
	Officer (give title below)	Other (specify below)

3. Date of Earliest Transaction (Month/Day/Year)
09/23/2009

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	09/21/2009		A⁽¹⁾		130,246	A⁽¹⁾	⁽¹⁾	331,766	I	See Footnotes⁽¹⁾⁽²⁾⁽³⁾⁽⁴⁾
Common Stock								24,446,070	I	See Footnotes⁽²⁾⁽³⁾⁽⁴⁾

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)

Explanation of Responses:

1. Common Stock is to be issued to the reporting person pursuant to a stock grant agreement in consideration of the reporting person's service as a director of Technest Holdings, Inc.

2. Reporting Person is the managing member of Mountain West Partners LLC, which beneficially owns 190,603 shares of Issuer's Common Stock. Reporting Person is an employee of Southridge Advisors, LLC ("Southridge"), which acts as the general partner to Southridge Partners L.P, and acts as the investment advisor to Southshore Capital Fund Ltd., a Cayman Island corporation, ("Southshore"). Reporting Person is an employee of Southridge Capital Management LLC ("Southridge"), which acts as the investment sub-advisor to Aberdeen Avenue LLC, a Cayman Island limited liability company ("Aberdeen"), and Garth LLC, a Cayman Island limited liability company ("Garth"). Reporting Person disclaims beneficial ownership of all shares other than those issued to Reporting Person as a Director of the Issuer. (Continued to footnote 3)

3. (Continued from footnote 2) Southridge Partners is the beneficial owner of an aggregate of 17,863,850 shares of Issuer's Common Stock, which number includes 11,019,023 shares of Common Stock, 344,827 shares of the Issuer's Series C Preferred Stock, which is convertible, subject to certain restrictions, into 344,827 shares of the Issuer's Common Stock, and 1,300 shares of the Issuer's Series D Preferred Stock, which is convertible, subject to certain restrictions, into 6,500,000 shares of the Issuer's Common Stock. Southshore is the beneficial owner of an aggregate of 1,072,257 shares of Issuer's Common Stock, which number includes 977,741 shares of Common Stock, 57,467 shares of the Issuer's Series C Preferred Stock, convertible into 57,467 shares of the Issuer's Common Stock, and 111.81 shares of Series G Preferred Stock issued by Markland Technologies Inc., (Continued to footnote 4)

4. (Continued from footnote 3) convertible subject to certain restrictions into an additional 37,049 shares of the Issuer's Common Stock. Aberdeen is the beneficial owner of an aggregate of 5,014,782 shares of Issuer's Common Stock, which number includes 1,416,101 shares of Common Stock, 640 shares of the Issuer's Series D Preferred Stock, which is convertible, subject to certain restrictions, into 3,200,000 shares of the Issuer's Common Stock, and 1,203.18 shares of Series G Preferred Stock issued by Markland Technologies Inc., convertible subject to certain restrictions into an additional 398,681 shares of the Issuer's Common Stock. Garth is the beneficial owner of 64.631 shares of the Issuer's Series A Preferred Stock convertible in 304,578 shares of the Issuer's Common Stock.

	/s/ Henry Sargent	09/23/2009
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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