ASSIGNMENT AND ASSUMPTION AGREEMENT

FOR INDEXING PURPOSES:

Memorandum of Lease Agreement recorded in Book 2137 at Page 319;

rerecorded Book 2156 at Page 100

First Amendment of Memorandum of Lease Agreement recorded in Book 4976 at Page 240

This ASSIGNMENT AND ASSUMPTION AGREEMENT (the “Agreement ”) is made effective as of the 22nd day of March, 2007 (the “Effective Date”) by and between LATI USA, INC. , a South Carolina corporation, formerly known as LATI INDUSTRIES, INC. (“LATI”) and FORCE PROTECTION TECHNOLOGIES, INC. , a Nevada corporation (“FPT”).  LATI and FPT are sometimes referred to herein as the “parties.”

RECITALS :

WHEREAS, Dorchester County, South Carolina (the “County”) and LATI have entered into a Lease Agreement dated December 7, 1998, as amended by that certain First Amendment of Lease Agreement dated July 25, 2005 (as amended, the “FILOT Lease”) with regard to certain real (as set forth in Exhibit A attached hereto) and personal property located in the County (the “FILOT Property”);

WHEREAS, prior to the entry by the County and LATI into the FILOT Lease, the County and LATI entered into an Inducement Agreement and Millage Rate Agreement dated as of April 6, 1998, as amended by that certain Amendment to Inducement Agreement and Millage Rate Agreement dated as of February 17, 1999 (as amended, the “Inducement Agreement”) relating to the FILOT Property and the millage to be levied by the County against the FILOT Property for purposes of computing payments by LATI of a fee in lieu of taxes with regard to the FILOT Property;

WHEREAS, Section 9.01 of the FILOT Lease provides that LATI may assign its interest in the FILOT Lease;

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WHEREAS, pursuant to the terms of that certain Asset Purchase Agreement dated as of even date herewith by and between LATI and FPT (the “Asset Purchase Agreement”), LATI desires to sell and assign to FPT , and FPT desires to acquire and assume from LATI, all of LATI’s rights and interest in and to the FILOT Lease; and

WHEREAS, by Resolution #07-03, duly adopted by the Dorchester County Council on March 19, 2007 (the “Approval Resolution”), the County (a) approved the assignment and transfer by LATI to FPT of the FILOT Lease , and (b) authorized the County Administrator of Dorchester County Council to execute on behalf of the County such documents as the County Administrator determines are reasonably required in order to further reflect or evidence the approval by the County, including, without limitation, any modifications to the documents previously executed or approved by the County relating to the projects subject to this Agreement as may be required in order to clarify any ambiguities or remedy any omissions or errors in such documents .

NOW, THEREFORE, for and in consideration the covenants herein set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and confessed, the parties covenant and agree as follows:

1.             Assignment .  As of the Effective Date, LATI assigns all of its rights under the FILOT Lease, the Inducement Agreement and the related documents to FPT.

2.             Assumption of Obligations .  FPT shall discharge in full all of LATI’s liabilities, duties and obligations arising under, or in any manner related to, the FILOT Lease and accruing after 12:01 a.m. on the Effective Date.  FPT, as of such date and time, shall comply with all terms, covenants and conditions of the FILOT Lease.  FPT shall have no liability with respect to any payments under the FILOT Lease which come due after the Effective Date, but which arose in connection with periods occurring prior to the Effective Date.

3.             Release of LATI .  LATI is hereby released from any and all obligations, duties, and liabilities arising under, or in any manner related to, the FILOT Lease and accruing after 12:01 a.m. on the Effective Date, and FPT hereby accepts and assumes all such obligations, duties, liabilities and benefits relating to the FILOT Lease.  LATI is not released, however, from liability with respect to any payments under the FILOT which (i) are due as of the Effective Date, or (ii) come due after the Effective Date, but which arose in connection to periods occurring prior to the Effective Date.

4.             Transfer of Title .  Article X of the FILOT Lease provides the tenant under the FILOT Lease with (i) a mandatory obligation to purchase the Project (as defined in the FILOT Lease) and (ii) options to from time to time to purchase the Project.  Upon the occurrence of the mandatory purchase obligation or the exercise of the purchase option provisions set forth in Article X of the FILOT Lease, the FILOT Lease provides that the County shall transfer directly to LATI all of its fee simple ownership interest in the Project with respect to which such option is exercised.  The parties intend that this Agreement modify the FILOT Lease and any related documents so that the County shall transfer directly to FPT all of its fee simple ownership interest in the Project with respect to which such option is exercised.

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5.             Fee in Lieu of Taxes Invoices .

(a)            LATI will immediately notify the South Carolina Department of Revenue of this Agreement and the assignment by LATI to FPT.

(b)           It is intended that FPT shall separately make any submissions or reports to the appropriate governmental authorities in connection with the FILOT Payments (as defined in the FILOT Lease).  FPT shall be responsible for making all necessary and required FILOT Payments and for complying with all reporting requirements that may be required beginning as of the Effective Date, directly to the County or the South Carolina Department of Revenue, concerning the FILOT Lease.

6.             Notices .  Any notice to be given in connection with this Agreement shall be in writing and shall be deemed to have been given when deposited with a national