Item 8.01. Other Events.

On August 22, 2012, Cyalume Technologies Holdings, Inc. (the "Company") obtained a copy of a complaint filed in the United States District Court for the District of Delaware. The complaint was filed by Antonio Colon, an employee of the Company's wholly-owned subsidiary, Cyalume Technologies, Inc. ("CT"). The complaint was filed against the Company, CT, and CT's wholly-owned subsidiary, Cyalume Realty, Inc. ("CRI"). The complaint alleges, among other things, that CT has constructively terminated Mr. Colon's employment and that the Company and CT have breached certain provisions of the Stock Purchase Agreement, dated as of December 22, 2011 (the "Purchase Agreement"), among CT, the Company, Combat Training Solutions, Inc., and Mr. Colon. Mr. Colon seeks, among other things, payment of the full potential earn-out amount of $5,750,000 which he alleges is payable under the Purchase Agreement, payment of salary, wages, bonuses and benefits pursuant to Mr. Colon's employment agreement with CT, and attorneys' fees and costs. The complaint seeks similar relief to the demand for arbitration previously filed by Mr. Colon, as announced by the Company in its 8-K filed on June 20, 2012.

The Company considers the allegations by Mr. Colon to be without merit and intends to fully defend itself on these matters.