content: UNITED STATES
                         SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, DC 20549
  
                                      FORM 8-K
  
                               CURRENT REPORT PURSUANT
                            TO SECTION 13 OR 15(D) OF THE
                           SECURITIES EXCHANGE ACT OF 1934
  
  
      Date of report (Date of earliest event reported)     December 21, 2004
                                                       ------------------------
  
                              ICTS INTERNATIONAL, N.V.
  -----------------------------------------------------------------------------
               (Exact Name of Registrant as Specified in Its Charter)
  
                                   The Netherlands
  
                   (State or Other Jurisdiction of Incorporation)
  
                 0-28542                               00-0000000
  -----------------------------------------------------------------------------
       (Commission File Number)               (IRS Employer Identification No.)
  
                 Biesbosch 225, 1181 JC Amstelveen, The Netherlands
  -----------------------------------------------------------------------------
         (Address of Principal Executive Offices)                    (Zip Code)
  
                                 011-31-20-347-1077
                (Registrant's Telephone Number, Including Area Code)
  
  
            (Former Name or Former Address, if Changed Since Last Report)
  
   Check the appropriate box below if the Form 8-K filing is intended to
  simultaneously satisfy the filing obligation of the registrant under any of the
  following provisions (see General Instruction A.2 below):
  
   Written communications pursuant to Rule 425 under the Securities
  Act (17 CFR 230.425)
  
  Soliciting material pursuant to Rule 14a-12 under the Exchange
  Act (17 CFR 240.14a-12)
  
  Pre-commencement communications pursuant to Rule 14d-2(b) under
  the Exchange Act (17 CFR 240.14d-2(b))
  
  Pre-commencement communications pursuant to Rule 13e-4(c) under
  the Exchange Act (17 CFR 240.13e-4(c))
  
  
  <PAGE>
  ITEM 1.01   Entry into a Material Definitive Agreement.
  
  The Management Board and the Supervisory Board on November 30, 2004 have
  approved and adopted, subject to shareholders approval, the 2005 Equity
  Incentive Plan, (the "Plan").
  
  The Plan provides a means whereby employees, officers, directors, and certain
  consultants and independent contractors of the Company ("Qualified Grantees")
  may acquire the Common Shares of the Company pursuant to grants of (i) Incentive
  Stock Options ("ISO"), (ii) non-qualified stock options (the "NQSO") and (iii)
  restricted stock. A summary of the significant provisions of the Plan is set
  forth below. A copy of the full Plan is annexed as Exhibit A to this Proxy
  Statement. The following description of the Plan is qualified in its entirety by
  reference to the Plan itself.
  
  The purpose of the Plan is to further the long-term stability, continuing growth
  and financial success of the Company by attracting and retaining key employees,
  directors and selected advisors through the use of stock incentives, while
  stimulating the efforts of these individuals upon whose judgment and interest
  the Company is and will be largely dependent for the successful conduct of its
  business. The Company believes that the Plan will strengthen these persons'
  desire to remain with the Company and will further the identification of those
  persons' interests with those of the Company's shareholders.
  
  The Plan shall be administered by the Compensation Committee of the Supervisory
  Board, which shall be appointed by the Supervisory Board of the Company, and
  which shall consist of a minimum of three members of the Supervisory Board of
  the Company.
  
  The Plan provides that options to purchase up to 1,500,000 Common Shares of the
  Company may be issued to the employees, certain consultants and directors. All
  present and future employees shall be eligible to receive incentive awards under
  the Plan, and all present and future non-employee directors shall be eligible to
  receive non-statutory options under the Plan. An eligible employee or
  non-employee director shall be notified in writing, stating the number of shares
  for which options are granted, the option price per share, and conditions
  surrounding the grant and exercise of the options.
  
  The exercise price of shares of Company Stock covered by an ISO and NQSO shall
  be not less than 100% of the fair market value of such shares on the date of
  grant; provided that if an ISO is granted to an employee who, at the time of the
  grant, is a 10% shareholder, then the exercise price of the shares covered by
  the incentive stock option shall be not less than 110% of the fair market value
  of such shares on the date of grant. The Plan also provides for cashless
  exercise of Options at the discretion of the Compensation Committee. In such
  event, there maybe a charge to the earnings of the Company with respect to the
  cashless exercise of the Options.
  
  The Compensation Committee may determine the number of shares that may be
  awarded to a participant as restricted stock and the provisions relating to risk
  of forfeiture and may determine that the restricted stock is only earned upon
  the satisfaction of performance goals established by
  
  
  <PAGE>
  
  the Committee. The Committee shall also determine the nature, length and
  starting date of any performance period and the terms thereof.
  
  The Compensation Committee has recommended and the Supervisory Board and the
  Management Board have approved the granting of the following options under the
  2005 Equity Incentive Plan subject to the Plan being approved by shareholders as
  follows:
  
  1. Menachem Atzmon (Chairman of the Board) - 550,000 options of which 250,000
  shall be immediately vested and 300,000 options to be vested equally over the
  next three years. With respect to the Options for 200,000 shares they are
  granted in lieu of a current salary for Mr. Atzmon. Options are exercisable at
  $1.35 per share representing the fair market value on the date of grant.
  
  2. Doron Zicher (Key Employee) - 45,000 options to be vested equally over the
  next three years. Options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  
  3. Ran Langer (Managing Director) - 65,000 options to be vested equally in the
  next three years. Options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  
  4. Dan Abraham (Managing Director) - 55,000 options to be vested equally in the
  next three years. Options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  
  5. Udi Bechor (Key Employee) - 45,000 options to be vested equally in the next
  three years. Options are exercisable at $1.35 per share representing the fair
  market value on the date of grant.
  
  6. Oded Shoam (Key Employee) - 50,000 options to be vested equally in the next
  three years. Options are exercisable at $1.35 per share representing the fair
  market value on the date of grant.
  
  7. (Directors) There be granted 30,000 options each to the Directors, namely,
  Elie Housman, Philip Getter, Lynda Davey, M. Albert Nissim and David W. Sass.
  The Options shall be immediately vested as to 10,000 shares and shall vest
  10,000 shares on each anniversary in the event such person is a Director of the
  Company at that time. The options are exercisable at $1.35 per share
  representing the fair market value on the date of grant.
  
  8. (Committee Chairs) The Chairman of the Audit Committee and the Chairman of
  the Compensation Committee should each be granted 30,000 additional Options. The
  Options shall be immediately vested as to 10,000 shares and shall vest 10,000
  shares on each anniversary in the event such person is a Director of the Company
  at that time. The options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  
  
  
  <PAGE>
  
  ITEM 4.02 Non-Reliance on Previously Issued Financial Statements or a Related
  Audit Report or Completed Interiim Review.
  
  On December 21, 2004 the Audit Committee of ICTS International, N.V. determined
  that as a result of an adverse decision by the Pennsylvania Supreme Court
  reversing a favorable decision of the lower court in a case involving Pioneer
  Commercial Funding, a company in which ICTS has an investment, the Company has
  decided to restate its financial statements for the three months ended March 31,
  2004. Pioneer has asked the court for a re-hearing based upon Pioneer's belief
  that the courts ruling was based in part on facts not in evidence. As a result
  of the restatement, the Company has written off its entire investment in Pioneer
  of $1,716,000. The effect of the restatement on the Statement of Operations for
  the first quarter of March 2004 is that the "Share in Losses of Associated
  Companies" increased from $5,000 to $1,721,000 and the loss for the period
  increased from $7,943,000 to $9,659,000. On the balance sheet side the
  "Investment in Associated Companies" decreased from $5,341,000 to $3,625,000 and
  the "Retained Earnings" decreased from $22,669,000 to $20,953,000. The matter of
  re-statement was reviewed with the Company's independent auditors who concurred
  in the re-statement.
  
  ITEM 9.01     Financial Statements and Exhibits
  
  (c) Exhibits
         10.  2005 Equity Incentive Plan
  
  
  
  
  
  <PAGE>
  
  
                                                       SIGNATURES
  
  
  Pursuant to the requirements of the Securities Exchange Act of 1934, the
  registrant has duly caused this report to be signed on its behalf by the
  undersigned hereunto duly authorized.
  
                                                ICTS INTERNATIONAL, N.V.
                                                     (Registrant)
  
                                               By: /s/ Avraham Dan
                                               Avraham Dan, Managing Agent
  
  
  
  DATED:   December 21, 2004
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metadata_filer: {"company-data": {"conformed-name": "ICTS INTERNATIONAL N V", "cik": "0001010134", "assigned-sic": "7389", "irs-number": "043212044", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-28542", "film-number": "041215974"}, "business-address": {"street1": "1 ROCKEFELLER PLAZA", "street2": "SUITE 2412", "city": "NEW YORK", "state": "NY", "zip": "10020"}, "mail-address": {"street1": "1 ROCKEFELLER PLAZA", "street2": "SUITE 2412", "city": "NEW YORK", "state": "NY", "zip": "10020"}, "former-company": {"former-conformed-name": "ICTS HOLLAND PRODUCTION BV", "date-changed": "19960306"}}
text: UNITED STATES
                         SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, DC 20549
  
                                      FORM 8-K
  
                               CURRENT REPORT PURSUANT
                            TO SECTION 13 OR 15(D) OF THE
                           SECURITIES EXCHANGE ACT OF 1934
  
      Date of report (Date of earliest event reported)     December 21, 2004
                                                       ------------------------
  
                              ICTS INTERNATIONAL, N.V.
  -----------------------------------------------------------------------------
               (Exact Name of Registrant as Specified in Its Charter)
  
                                   The Netherlands
  
                   (State or Other Jurisdiction of Incorporation)
  
                 0-28542                               00-0000000
  -----------------------------------------------------------------------------
       (Commission File Number)               (IRS Employer Identification No.)
  
                 Biesbosch 225, 1181 JC Amstelveen, The Netherlands
  -----------------------------------------------------------------------------
         (Address of Principal Executive Offices)                    (Zip Code)
  
                                 011-31-20-347-1077
                (Registrant's Telephone Number, Including Area Code)
  
            (Former Name or Former Address, if Changed Since Last Report)
  
   Check the appropriate box below if the Form 8-K filing is intended to
  simultaneously satisfy the filing obligation of the registrant under any of the
  following provisions (see General Instruction A.2 below):
  
   Written communications pursuant to Rule 425 under the Securities
  Act (17 CFR 230.425)
  
  Soliciting material pursuant to Rule 14a-12 under the Exchange
  Act (17 CFR 240.14a-12)
  
  Pre-commencement communications pursuant to Rule 14d-2(b) under
  the Exchange Act (17 CFR 240.14d-2(b))
  
  Pre-commencement communications pursuant to Rule 13e-4(c) under
  the Exchange Act (17 CFR 240.13e-4(c))
  ITEM 1.01   Entry into a Material Definitive Agreement.
  
  The Management Board and the Supervisory Board on November 30, 2004 have
  approved and adopted, subject to shareholders approval, the 2005 Equity
  Incentive Plan, (the "Plan").
  
  The Plan provides a means whereby employees, officers, directors, and certain
  consultants and independent contractors of the Company ("Qualified Grantees")
  may acquire the Common Shares of the Company pursuant to grants of (i) Incentive
  Stock Options ("ISO"), (ii) non-qualified stock options (the "NQSO") and (iii)
  restricted stock. A summary of the significant provisions of the Plan is set
  forth below. A copy of the full Plan is annexed as Exhibit A to this Proxy
  Statement. The following description of the Plan is qualified in its entirety by
  reference to the Plan itself.
  
  The purpose of the Plan is to further the long-term stability, continuing growth
  and financial success of the Company by attracting and retaining key employees,
  directors and selected advisors through the use of stock incentives, while
  stimulating the efforts of these individuals upon whose judgment and interest
  the Company is and will be largely dependent for the successful conduct of its
  business. The Company believes that the Plan will strengthen these persons'
  desire to remain with the Company and will further the identification of those
  persons' interests with those of the Company's shareholders.
  
  The Plan shall be administered by the Compensation Committee of the Supervisory
  Board, which shall be appointed by the Supervisory Board of the Company, and
  which shall consist of a minimum of three members of the Supervisory Board of
  the Company.
  
  The Plan provides that options to purchase up to 1,500,000 Common Shares of the
  Company may be issued to the employees, certain consultants and directors. All
  present and future employees shall be eligible to receive incentive awards under
  the Plan, and all present and future non-employee directors shall be eligible to
  receive non-statutory options under the Plan. An eligible employee or
  non-employee director shall be notified in writing, stating the number of shares
  for which options are granted, the option price per share, and conditions
  surrounding the grant and exercise of the options.
  
  The exercise price of shares of Company Stock covered by an ISO and NQSO shall
  be not less than 100% of the fair market value of such shares on the date of
  grant; provided that if an ISO is granted to an employee who, at the time of the
  grant, is a 10% shareholder, then the exercise price of the shares covered by
  the incentive stock option shall be not less than 110% of the fair market value
  of such shares on the date of grant. The Plan also provides for cashless
  exercise of Options at the discretion of the Compensation Committee. In such
  event, there maybe a charge to the earnings of the Company with respect to the
  cashless exercise of the Options.
  
  The Compensation Committee may determine the number of shares that may be
  awarded to a participant as restricted stock and the provisions relating to risk
  of forfeiture and may determine that the restricted stock is only earned upon
  the satisfaction of performance goals established by
  the Committee. The Committee shall also determine the nature, length and
  starting date of any performance period and the terms thereof.
  
  The Compensation Committee has recommended and the Supervisory Board and the
  Management Board have approved the granting of the following options under the
  2005 Equity Incentive Plan subject to the Plan being approved by shareholders as
  follows:
  
  1. Menachem Atzmon (Chairman of the Board) - 550,000 options of which 250,000
  shall be immediately vested and 300,000 options to be vested equally over the
  next three years. With respect to the Options for 200,000 shares they are
  granted in lieu of a current salary for Mr. Atzmon. Options are exercisable at
  $1.35 per share representing the fair market value on the date of grant.
  
  2. Doron Zicher (Key Employee) - 45,000 options to be vested equally over the
  next three years. Options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  
  3. Ran Langer (Managing Director) - 65,000 options to be vested equally in the
  next three years. Options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  
  4. Dan Abraham (Managing Director) - 55,000 options to be vested equally in the
  next three years. Options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  
  5. Udi Bechor (Key Employee) - 45,000 options to be vested equally in the next
  three years. Options are exercisable at $1.35 per share representing the fair
  market value on the date of grant.
  
  6. Oded Shoam (Key Employee) - 50,000 options to be vested equally in the next
  three years. Options are exercisable at $1.35 per share representing the fair
  market value on the date of grant.
  
  7. (Directors) There be granted 30,000 options each to the Directors, namely,
  Elie Housman, Philip Getter, Lynda Davey, M. Albert Nissim and David W. Sass.
  The Options shall be immediately vested as to 10,000 shares and shall vest
  10,000 shares on each anniversary in the event such person is a Director of the
  Company at that time. The options are exercisable at $1.35 per share
  representing the fair market value on the date of grant.
  
  8. (Committee Chairs) The Chairman of the Audit Committee and the Chairman of
  the Compensation Committee should each be granted 30,000 additional Options. The
  Options shall be immediately vested as to 10,000 shares and shall vest 10,000
  shares on each anniversary in the event such person is a Director of the Company
  at that time. The options are exercisable at $1.35 per share representing the
  fair market value on the date of grant.
  ITEM 4.02 Non-Reliance on Previously Issued Financial Statements or a Related
  Audit Report or Completed Interiim Review.
  
  On December 21, 2004 the Audit Committee of ICTS International, N.V. determined
  that as a result of an adverse decision by the Pennsylvania Supreme Court
  reversing a favorable decision of the lower court in a case involving Pioneer
  Commercial Funding, a company in which ICTS has an investment, the Company has
  decided to restate its financial statements for the three months ended March 31,
  2004. Pioneer has asked the court for a re-hearing based upon Pioneer's belief
  that the courts ruling was based in part on facts not in evidence. As a result
  of the restatement, the Company has written off its entire investment in Pioneer
  of $1,716,000. The effect of the restatement on the Statement of Operations for
  the first quarter of March 2004 is that the "Share in Losses of Associated
  Companies" increased from $5,000 to $1,721,000 and the loss for the period
  increased from $7,943,000 to $9,659,000. On the balance sheet side the
  "Investment in Associated Companies" decreased from $5,341,000 to $3,625,000 and
  the "Retained Earnings" decreased from $22,669,000 to $20,953,000. The matter of
  re-statement was reviewed with the Company's independent auditors who concurred
  in the re-statement.
  
  ITEM 9.01     Financial Statements and Exhibits
  
  (c) Exhibits
         10.  2005 Equity Incentive Plan
  SIGNATURES
  
  Pursuant to the requirements of the Securities Exchange Act of 1934, the
  registrant has duly caused this report to be signed on its behalf by the
  undersigned hereunto duly authorized.
  
                                                ICTS INTERNATIONAL, N.V.
                                                     (Registrant)
  
                                               By: /s/ Avraham Dan
                                               Avraham Dan, Managing Agent
  
  DATED:   December 21, 2004