1032863--4/13/2006--FORCE_PROTECTION

related topics

{stock, price, share}

{control, financial, internal}

{product, market, service}

{customer, product, revenue}

{stock, price, operating}

{interest, director, officer}

{product, liability, claim}

{property, intellectual, protect}

{personnel, key, retain}

{operation, international, foreign}

{cost, regulation, environmental}

RISKS RELATED TO OUR BUSINESS We had losses since our inception and expect losses to continue in the future. We may never become profitable. We have a limited operating history and may never achieve or sustain profitable operations. Our independent accountants have issued a Going Concern Opinion and, if we do not generate enough cash from operations to sustain our business, we may have to liquidate assets or curtail our operations. If we can not access sufficient funds when needed, we may not be able to meet our contractual obligations to deliver our products and our business may fail. We depend on our suppliers and if we can not obtain certain components for our products, we might have to develop alternative designs that could increase our costs. We market our products to a limited customer base and if we do not find acceptance of our products within that customer base, our business may fail. Some of our product components are manufactured in South Africa or other foreign countries and if they become unstable or changes government regulations our costs may increase or we may become unable to source certain parts. We may be subject to personal liability claims for our products and if our insurance is not sufficient to cover such claims, our expenses may increase substantially. We are subject to substantial competition and we must continue research and development to remain competitive. We must comply with environmental regulations or we may have to pay expensive penalties or clean up costs. We rely on proprietary designs and rights and if we have to litigate those rights, our expenses could substantially increase. Insiders can exert significant control over our policies and affairs and they may assert control in a manner that does not favor minority shareholders. We depend on management and other key personnel and we may not be able to execute our business plan without their services. RISKS RELATED TO OUR STOCK Penny Stock rules may make buying or selling our securities difficult. Our securities have been thinly traded on the over-the-counter bulletin board, which may not provide liquidity for our investors. Investors must contact a broker-dealer to trade over-the-counter bulletin board securities. As a result, you may not be able to buy or sell our securities at the times that you may wish. We do not intend to pay dividends in the foreseeable future; therefore, you may never see a return on your investment. Our stock price is volatile and you may not be able to sell your shares for more than what you paid.

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1032863--4/13/2006--FORCE_PROTECTION_INC