Good afternoon ladies and gentlemen, thank you for standing by. Welcome to the Force Protection investor conference call. During the presentation all participants will be in a listen only mode. After the speakers’ remarks you will be invited to participate in a question and answer session. As a reminder ladies and gentlemen this conference is recorded today March 24, 2008. I would now like to turn the conference over to Mr. Tommy Pruitt Force Protection’s Senior Communications Director. Please go ahead sir.

Certain statements in this presentation including without limitation statements relating to the company’s business expectation for the remainder of 2008, statements related to the beliefs of management of Force Protection, expectations or opinions and all other statements in this presentation other than historical facts are forward-looking statements. As such term is defined in the Securities Exchange Act of 1934 which are intended to be covered by the Safe Harbors created thereby. Forward-looking statements are subject to risk and uncertainties, are subject to change at any time and may be affected by various factors that may cause actual results to differ materially from expected or planned results. In addition, to the statements discussed above certain other statements are forward-looking including without limitation the number of vehicles the company expects to deliver in 2008, the value of the sustainment and remanufacturing orders the company may receive during 2008, our ability to secure foreign military sales for our products, our relationship with the United States Department of Defense, General Dynamics Land Systems and DRS Sustainment Systems, Inc., our ability to develop and diversify our new product offerings, the desirability of the Cheetah vehicle as an interim solution for our customers, our ability to engage a new nationally recognized audit firm, our ability to address the disclosed material weaknesses over internal controls or other business systems and our beliefs about defending class action lawsuits. These statements are subject to numerous risk and uncertainties including but not limited to the risks detailed in our annual report on Form 10K for the year ended December 31, 2006 and other reports filed by the company with the Securities & Exchange Commission. I would now like to turn the conference call over to Michael Moody our Chief Executive Officer.

Good afternoon and thank you for joining us. My name is Michael Moody and I’m the Chairman and Chief Executive Officer of Force Protection. With me today to answer questions are Frank Scheuerell, our Interim Chief Financial Officer and Damon Walsh the Executive Vice President of Customer Operations. I want to start by thanking you for your patience. Let me begin today’s remarks with a little bit of information about my history with Force Protection. I joined the board of directors in September, 2006. In September, 2007 the board asked that I assume the role of president. With the departure of our former chief executive officer I was appointed as chairman of the board of directors and interim CEO. As of March the 1st of this year the board appointed me as the chief executive officer. I bring to this role 30 year of business management and finance experience in some difficult turnaround situations. I understand the issues facing Force Protection and believe there’s a strong future for this company. We are very aware that there’s a demand for the company to address some of the announced recent events and its strategic direction. We’re going to do our best to address that need in these remarks today and then to answer your questions. It had been our plan to hold this call following the filing of our 2007 Form 10K so that we could speak both to the numbers as well as to our strategic and competitive direction. As you may have seen we continue to be faced with a delay in the completion of our 2007 Form 10K. As a result of that, as I am sure you can appreciate our ability to speak to the numbers is somewhat limited. We will give you what information we can but…

The question and answer session will be conducted electronically. (Operator Instructions) with Chris Donaghey with Suntrust Robinson and Humphrey.

First of all, on the third quarter accounting issue can you just clarify or provide any kind of detail, is it limited to just the third quarter of 2007 as far as you’ve been able to tell?

We’re not in a position to comment on anything in relation to the 2007 accounts at this stage.

Okay. So getting back to the business then, the potential upgrade program then for the Marine Corp, can you talk about how that would be treated in the factory? Is this very much analogous to building a new vehicle? Is there the potential for it to be stripped down and rebuilt to a common protection level? I think if you look back to the December order there were pretty significant engineering change proposals that were part of that and I’m assuming there were some upgrade protection packages. Are we talking about upgrading the fleet to some common protection package?

The remanufacture program could take any number of forms and as I’ve indicated we’re not clear exactly what that will be. But, what I might ask is if Damon Walsh could say a few words on this. I know he’s been in discussions with the Marines on the subject.

We’re working with the Corp to lay our different options for them to go back and it is addressing the entire fleet to include legacy [inaudible] and ATVs. To layout a program along the lines of the Abrams Tank, AIM and SEP program where they can pick and choose from everything from just installing new electrical components all the way up to dropping a new engine into the capsule. Some of that work would involve bringing the capsule back, tearing it all the way down and remanufacturing, some of it might involve field work but we’re working with the Corp to identify and lay out time lines and budget options for them going forward.

Okay, great. Thanks. Then, on the international market opportunities, is there any way to put any parameters on the relative size of that market? We know the US military is currently somewhere around 15,000 potential vehicles and it would seem that the British move at a fairly rapid pace to expand their fleet from an initial 80 to now almost I guess 300 vehicles or so with the latest order. Is there any way to put some kind of parameters around the size of the international market at least as far as you’ve been able to tell?

Obviously there are some reasonably large forces and you’ve talked about the United Kingdom. I think the reality is that in terms of numbers rather than markets the numbers are likely to be somewhat less than that. But, the accumulation of those obviously tend to be a reasonably significant number. They’re not in this stage where we’re in a position to put any specific numbers to it but obviously a vehicle has the survivability and sustainability record and it’s the vehicle that does the job so there are a number of countries that are interested in this vehicle.

Then just one last question on the Cheetah vehicle itself, the Marine Corp obviously has spent more time with that vehicle, I think General [Comley] toured the facility, the Marine Corp actually published a story on this. Given the delays in that program can you just comment on the interest level from the Marine Corp in particularly given that we’re a little bit behind schedule on where the Cheetah is today?

As you look at it today there is significant interest in the vehicle. We believe there’s an operational need for this vehicle but certainly our understanding is that a vehicle with these capabilities is likely to be of enormous value particularly in Afghanistan but to some extent in Iraq. That’s certainly the messages that we’re hearing.

There’s a lot of demand for something that is better than a Humvee but not as heavy as the MRAP fleet. We seem to step right in to that.

We’ll take our next question from Tim Quillin with Stephens, Incorporated.

In terms of some of the goals that you laid out for 08 I just want to make sure that I got the numbers right. Was 1,134 vehicles for all of 08 and 264 through February?

That is correct.

Okay.

That’s not for potential armory that’s just our vehicles, yes.

Okay. And that $580 million that doesn’t include the pass through revenue for GD?

That is correct.

Now, does the $580 million include service though?

No, it does not include service. That is purely for those vehicles.

Purely for those vehicles.

There’s no service included in that.

And can you break down the 1,134 by vehicle? And, are you only including what’s in backlog right now?

Correct. There aren’t any vehicles where we have a car holder. These are vehicles that are currently on order that we’re delivering to an order.

And how much of that is Buffalo?

It’s less than 100, it’s closer to about 75, 85 are Buffalo.

In the 75 to 85 range.

Okay. And how much of it is international or non-MRAP Cougar?

A few hundred vehicles.

Great. Could you discuss a little bit any specific opportunities that you might have on the international side?

I don’t know if I can say anything more than I did in my comments. We are obviously actively seeking out international sales. Damon Walsh has specific responsibility for that area just as we talked about beefing up our presence with [tycom] and other areas we’re strengthening our presence in terms of seeking our international opportunities. I can’t say anything more specifically than that but it’s an area that we are extremely active in.

Then how do you think about right sizing the company? I think I had read where you might kind of given the current backlog of vehicles might slow your production rate a little bit and presumably right size your infrastructure? But, how do you manage the process of moving into not a post MRAP world but a lower sustainment level on the MRAP program?

We’re really in a position where obviously there’s a lot of work at the company to make sure we have a company at the right size for the production we have at the moment for the sustainment and the other opportunities. So, it’s just part of the normal operations of our business that we ensure we have the right facilities and the right people. The other thing I’d say to you which I’m sure you’re all aware is this company went through extraordinary growth particularly during 2007 so it’s not that much different from where we are now to look at the company that has a different infrastructure and different operations.

We’ll go next to Pat McBain with Gruber & McBain.

You mentioned one of the obvious areas of weakness as one looks back on the MRAP program was a lack of competitive lobbying and support on Capitol Hill. You’ve mentioned that is obviously an areas of focus but, could you put any specifics behind that? Are you planning to meet with Lindsey Graham and a few others, he was on Face the Nation this weekend. He looks like he and John McCain want to stay in Iraq for 100 years. So, he’s a pretty hard line guy I would think he could help you.

Well, just generally we are reaching out to all of our elected officials. We’ll doing that as an organization on an ongoing basis. I think it’s a very valuable thing for this company to do, it’s something that I will do on an ongoing basis. I’m doing it now and I’ll do it on an ongoing basis. The elected officials that we’ve met and that’s been across a broad range of elected officials have been very receptive of the company and have welcomed the communication.

Do you think they’re well aware of what happened to you in the sort of sequencing of MRAP vehicle orders? And, do they find themselves embarrassed by having been out politicked?

I don’t know about the second part of your question but the first I believe they are aware of it actually.

Okay. Could you just add a little bit of color to what you hope to get out of the DRS partnership?

I think we talked about it in terms of [inaudible] scores and capabilities are and what theirs are. We obviously have capabilities in terms of platforms, we have developed these vehicles with the survivability and sustainability and DRS brings us everything in their broad range of integration and all the things they have associated with that. We took the opportunity, both of these organizations took the opportunity of getting to know each other for a while before we decided that this was worthwhile and I think that was extremely helpful. I think there is a good fit between these two organizations.

Specifically you see them helping in this remanufacturing or rebuild type program?

No. The association with DRS is centered around JLTV. So, we are working with DRS in terms of responding to the current need for JLTV but I think both organizations recognize there are potentially other opportunities as well. But, the relationship now with DRS is purely focused on JLTV.

What’s the status of your issues with GAO? Has that been resolved or is that sort of an ongoing open case or where are you with that?

I’m not exactly sure what you’re referring to. I’ll just make the general comment that obviously we have oversight and review all the appropriate government agencies and that’s just an ongoing part of our business and is something which is an important part of our business and an ongoing part of our business.

My understanding was that some time ago there were at least from their perspective some deficiencies in that area. I just don’t know whether that was true or whether it’s been corrected.

Would you be referring to the DCAA orders?

Yes.

We advised I think in our 2007 third quarter Q there was some detail around this issue. We are actively looking to make the requirements that the DCAA has identified related to providing the information that the customer needs.

And we hope to get Frank to sign on as a permanent CFO? Or, if not get a permanent CFO?

I would like to get Frank to sign on. Frank will not be our regular ongoing CFO even though he is enormously helpful to this organization and will stay with us as long as he needs to. Frank indicated clearly to me that he would like to see this as an interim position. Frank has other business interests and other involvements and he’s not in a position to do this. However, we are actively involved in a search for a chief financial officer. It is a search which we’ll take the time necessary to find the right person and Frank will be with us until that change takes place.

We’ll not next to Joe Maxa with Dougherty & Company.

Michael can you give us an idea how many vehicles you shipped in Q4?

As it really relates to 2007, I’m not sure I should specifically comment at this stage.

Okay. I guess I was just looking at the production level versus what you’ve done so far this quarter. It looks like you’re on pace to do about 400 in Q1 based on your first two months of production. Is that the level you’re planning on? Do you expect to maintain that until you either get more orders or kind of run low on vehicle production later in the year? Or, do you expect to taper that down?

That’s pretty much our current production. That’s pretty much how we see the production going through at least out a number of more months.

So, roughly 400 a quarter?

Yeah.

Okay. So that will give you another couple of quarters of vehicles and then at that point if you don’t have more orders come in or significantly reduced what would your plan be?

Well, there’s a few things. One, obviously we’re looking for more orders but as you say if we don’t have any more orders come in there’s the remanufacturing that we’re actively discussing with the customer, there’s all of our sustainment and support work, there’s this whole separate vehicle the Cheetah. The Buffalo orders continue on, we cannot talk about the Buffalo but it’s a long term recurring revenue business for us and the orders for that reach way out in to the future.

So, can that continue at 25 to 30 per quarter for what a couple of years?

We really see that going even further than that. We see that going on for some period of time.

Okay. Then when we look at your production capabilities and obviously you have the two facilities one up in Roxboro, does it make sense to consolidate those? What are your thoughts along that line?

We’re actively looking at that at the moment. We really in terms of what our current production levels are, in terms of where we are with orders, obviously we need to consider what facilities we need. It’s a matter that’s under active consideration by the management at the moment and we’d expect to come to some resolution in the next two to three months on that issue.

Right. Then, again on the orders, international orders and others, how many active RFPs do you have out there for the Cheetah and may for the Cougar with international opportunities?

Probably about the range of about six.

Six. Is that kind of a combination of the two then? Half Cheetah half Cougar? What should we be thinking about?

It’s a combination.

We’ll go next to Jim Mcilree with Collins Stewart.

Once you deliver on your existing backlog what would be the total number of Cougars that you have deployed? What I’m trying to get at is what would be the available market that could be remanufactured? So, what would be the total number in the field and then how many owned by the Marines which I think is the most likely to get remanufactured?

Yeah, the number is around 4,000. It’s around 4,000 vehicles.

And would most of those be with the Marines? Just a ballpark number how much with the Marines?

The vast majority of those are with the Marines. 75 to 80% of them are with the Marines.

Okay. So it’s your understanding that the Marines would potentially remanufacture in some fashion all of the vehicles in their fleet.

Over time.

Not the most current ones because they bring the older vehicles to the most current specifications. But yeah, the vast majority of the vehicles in the fleet.

And I think you’re going to tell me that you’re not going to answer this question but I’ll try it anyway. If you take the 07 net income it implies that Q4 was very weak. Were there any specific or unusual costs in Q4 that would lead to such a weak number?

I undertake to answer that question on the next conference call. When we publish the 10K I will answer that question.

Okay. Going forward then do you have a target profitability level in terms of either operating margins or pre-tax margins that you think is appropriate for this business?

We’re obviously working on what we think are the appropriate numbers. I’d really just prefer at this stage not to quote those. I think it might be a good foundation once we have the 2007 K out there that we can have a discussion much more focused on numbers. I think at this stage I would prefer to hold that conversation off.

And, on the cash level Michael I think I heard you say you have $70 million in cash. That would be as of right now?

As of right now.

We’ll go next to James Cross with Franklin Templeton.

Do you expect to make money this year?

We obviously run this to be a for profit business. I mean, that’s our expectation to run a for profit business.

And what do you expect in a broad range the cash to be at year end? Or, maybe you could talk about significant usages of cash this year?

I can’t really provide you with a number at the end of the year. The cash usage this year is going to be really for ordinary working capital purposes unless there is significant order for Cheetah, there may be some capital expenditures surrounding that.

Okay. Can you gage when do you expect to be able to file? Is this one of those indefinite things like the auction investigations have been? Or, is this more of a finite time period to get the filing done?

The objective of the management which includes Frank Scheuerell our interim chief financial officer is to file an accurate 10K. When we are comfortable we have an accurate 10K that’s been audited we’ll file it.

Can you give a ballpark range in what amount of service support and engineering revenue you expect this year?

$100 million.

And when do you expect the Marines to make a decision on how much and what time of remanufacturing and upgrading they expect to do?

I don’t know if we’ve gotten an exact timeframe but certainly they’re actively discussing it so I think it’s out through the summer sometime I suppose.

And do they have the funding in place for that? Is it already appropriated and authorized?

Not at this time.

I had thought that a large portion of that was authorized in the original MRAP budget?

It could be if they reprogram they could use some of the MRAP money, their existing MRAP money to support that. But, more than likely it will be FY09 funding that will start the remanufacturing program.

So, if we go into a continuing resolution situation with the FY09 budget proposal that would potentially delay this funding?

Yeah. I’m not sure, I’m not smart enough on what a CRA impact would be on O&M funding. If they did this with O&M, I believe – I don’t think this would constitute a new start program. You might know better than I.

Doubtful. Lastly, can you give us an update on MRAP II?

MRAP II testing is still ongoing. They’re in the final stages, they finished testing our coupons and are currently finishing testing on the vehicle. We’re working closely with the Marine Corp every day.

We’ll take a follow up from Chris Donaghey with Sunrust Robinson Humphrey.

I’m just trying to boil down a couple of the questions that have come since I asked mine. The real question is do you have a reasonable expectation to fill the order book in the back half of the year to either remanufacture activity or Cheetah or international orders? And, do you expect to be producing vehicles in 2009?

We certainly have a large part of 2008 order book filled and it’s largely through producing vehicles and then there’s the expectation in terms of remanufacturing. We don’t have any specific orders in 2009. We’re obviously actively looking at the foreign military, at the remanufacture, at the other areas that are going on. But certainly, what we’re looking at doing is being in the position to be producing vehicles next year but we have no orders. Now, that is with the exception of Buffalo which will continue obviously during that whole time. But, we are actively seeking to place orders in the 2009 year now.

Right. And I guess the analogy here is a commercial company typically has to work at filling its order book, it usually doesn’t at this stage of the year doesn’t have a plethora of orders booked for next year. So, given your [inaudible] approach I understand the business model that [inaudible] sales play in this. But, I guess just looking at the pipeline is there a reasonable expectation that some biz will come through and that the factory will be running and producing vehicles in 2009?

Well, as we’ve indicated before we’ve got the vehicle with the survivability and sustainability record. We’re actively seeking international sales. We’re talking about remanufacturing. Obviously, that’s all directed towards filling this order book out. The other thing that I would say having an order book largely filled up for 2008, I think this is the longest order book this company has had. I know that we and other folks are looking towards orders in 2009. In Force Protection’s history this current order book goes out a fair way.

We’ll talk a follow up from Tim Quillin with Stephens Incorporated.

Yeah I just had one quick follow up. Do you have in front of you the expected vehicle shipments by GD that will flow through your income statement?

Not really. The only thing I could say to you in general terms is it’s a 50/50 deal. So I think if you can look at our MRAP Cougar vehicles that’s basically a 50/50. It’s mirrored by what GD’s doing.

We’ll go next to Patrick McCarthy with FBR Capital Markets.

I just had two quick question for you. First, I was wondering if you could just talk about what types of scenarios are being examined with regards to the GD relationship at the current time?

I think the best thing is just to maybe add a little to what I said before which is the relationship was put in place specifically to met the Marines’ requirements as far as MRAP. So there was a need when that opportunity arose to put this relationship in place and it’s been a good relationship and it’s allowed those vehicles to be delivered and we have an excellent relationship with the customer. I think that both GD and Force Protection now see that there’s a chance to think about this relationship more strategically from an opportunistic point of view and we’re taking a broad view on that, a very broad view of how this partnership, or the relationship between these two companies might be beneficial. Obviously, Force Protection is in the sustainability solutions business and General Dynamics is a larger contractor so there are lots of way in which we could potentially develop this relationship.

Okay. Then, you spent quite a bit of time speaking about the Cheetah and I’m wondering what you think occurs here? Do you think it’s a possibility that the Cheetah ends up being some sort of interim vehicle between the current Humvee and JLTV?

We certainly believe that JLTV, I mean the dates are 2014 and 2015, we believe there are immediate operational requirements for an interim vehicle. We believe that the Cheetah meets or largely meets those requirements. So, absolutely this is something much shorter than 2014 or 15.

We’ll take a follow up from Jim Mcilree with Collins Stewart.

I just wanted to makes sure I heard correct, in response to a question on spares and service this year did you say $100 million this year you accepted? Or was that 07?

No, this is this year, 2008 we expect the number to be $100 million.

(Operator Instructions) At this time we have no additional question in the queue. Mr. Moody I’d like to turn the conference back to you for any additional or closing comments.

Thank you very much. I’d really like to thank everyone for participating on the call today. As I indicated before we will be having conference calls on a regular basis and I certainly hope that you join us for our next conference call. Thank you very much.

This concludes today’s conference. We appreciate your participation. You may now disconnect.