For Immediate Release

Bluefire Secures $10 Million in Series C Financing

Grotech Capital Group Leads Investment Round � Company Appoints Scott Schelle New Chief Operating Officer

Baltimore, MD. June 1, 2004 — Bluefire Security Technologies announced today that Grotech Capital Group, JK&B Capital, Walker Ventures, Maryland’s Department of Business and Economic Development, and the Maryland Angels Council have invested $10 million in the company to enable the expansion of sales, distribution and product development. With this Series C round, Maryland-based Grotech, a new investor, assumes a leading investment role in Bluefire Security. Since its inception in 2001, Bluefire Security has raised more than $17 million in equity financing.

"Bluefire Security has established itself as the premier wireless handheld security company in an industry with enormous potential," said Patrick Kerins, general partner with Grotech Capital Group and a new member of the Bluefire Security board of directors. "We look forward to contributing our network of contacts and operating experience to Bluefire Security’s next phase of development."

IDC predicts that the market for wireless PDAs and smart phones will grow from 22 million devices in 2004 to 100 million devices by 2008. As adoption rises, so does the likelihood that handhelds will become popular targets for security breaches.

"Despite the growing role of mobile devices in the corporate world, the vast majority of enterprises fail to recognize the significant range of security threats that accompany such mobility," said Alex Slawsby, senior analyst for IDC. "Handhelds are easy to lose and vulnerable to hacker attacks and malicious code. It is critical that enterprises implement comprehensive solutions with both on-device security and centralized management."

The new round will propel the company through its next expansion phase, enabling new product development, platform support beyond the Windows and Palm operating systems, and additional direct and indirect sales initiatives, both nationally and internationally.

To help accomplish these expansion goals, Bluefire Security has appointed Scott Schelle as the company’s chief operating officer. In this new role, he will drive Bluefire’s sales, marketing and business development activities and build out the company’s indirect channel, with particular focus on the carrier market.

Schelle brings to Bluefire Security more than 15 years of experience as an entrepreneur in the telecommunications industry and expertise in corporate finance and investing. Previously, he was a founder and chief executive officer of American Personal Communications (APC), a digital wireless services company that grew from a two-person research team to a 750-person, multi-state provider. In 1995, APC launched the nation’s first personal communications service (PCS) offering in the Baltimore-Washington market under the brand name of Sprint Spectrum. In 1998, Sprint purchased APC. He was also previously a principal with Sterling Venture Partners.

"Scott has proven that he can successfully build a company from an early stage to a mature level," said Mark Komisky, Bluefire Security’s chief executive officer. "As we grow rapidly with this new round of investment, Scott’s steady, experienced hand will be invaluable to me, the company and its investors."