This report describes the theory and structure of the FORCE2 flow program. The manual describes the governing model equations, solution procedure and their implementation in the computer program. FORCE2 is an extension of an existing B&V multidimensional, two-phase flow program. FORCE2 was developed for application to fluid beds by flow implementing a gas-solids modeling technology derived, in part, during a joint government -- industry research program, Erosion of FBC Heat Transfer Tubes, coordinated by Argonne National Laboratory. The development of FORCE2 was sponsored by ASEA-Babcock, an industry participant in this program. This manual is the principal documentation for the program theory and organization. Program usage and post-processing of code predictions with the FORCE2 post-processor are described in a companion report, FORCE2 -- A Multidimensional Flow Program for Fluid Beds, User`s Guide. This manual is segmented into sections to facilitate its usage. In section 2.0, the mass and momentum conservation principles, the basis for the code, are presented. In section 3.0, the constitutive relations used in modeling gas-solids hydrodynamics are given. The finite-difference model equations are derived in section 4.0 and the solution procedures described in sections 5.0 and 6.0. Finally, the implementation of the model equations and solution procedure in FORCE2 is described in section 7.0.