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Exhibit 10.1

LICENSE AGREEMENT

THIS LICENSE AGREEMENT (the “Agreement”) is entered into as of May 21, 2008 (the
“Effective Date”) by and between Material Technologies, Inc., a Delaware
corporation (“Licensor”), and Fatigue Solutions Corp., a California corporation
(“Licensee”) (individually, a “Party”; collectively, the “Parties”).
 
RECITALS

WHEREAS, Licensor is the owner of all right, title, and interest in the (i)
Fatigue Fuse, and (ii) Borescope  intellectual property (collectively, the
“Intellectual Property”); and

WHEREAS, Licensor desires to grant to Licensee, and Licensee desires to receive
from Licensor, a non-exclusive license to use, distribute, and sell the
Intellectual Property in accordance with the terms and conditions contained in
this Agreement (the “License”).

NOW THEREFORE, in consideration of the foregoing recitals and mutual covenants
contained herein, the Parties agree as follows:
 
ARTICLE 1
GRANT OF LICENSE
 
1.1           Grant of License.  Subject to the terms and conditions herein, and
on the basis of the representations, warranties and agreements herein contained,
Licensee agrees to receive from Licensor, and Licensor agrees to grant to
Licensee, a non-exclusive License to make, have made, use and sell use,
distribute, and sell the Intellectual Property.

1.2           Time and Place.  The closing of the transactions contemplated by
this Agreement shall take place at the offices of Licensor, located at 11661 San
Vicente Boulevard, Suite 707, Los Angeles, California 90049, immediately upon
the full execution of this Agreement, the satisfaction of all conditions, and
the delivery of all required documents, or at such other time and place as the
Parties mutually agree upon (which time and place are hereinafter referred to as
the “Closing”).

1.3           Royalty.  In consideration for the License, Licensee shall pay to
Licensor a royalty of 10% of all “Net Sales.”  Royalties payable under this
Agreement shall be paid within 90 days following the last calendar quarter in
which the royalties accrue.  For purposes of this Agreement, “Net Sales” shall
mean Licensee’s gross receipts for the sale, use and transfer of Intellectual
Property, as well as Licensee’s gross receipts for services performed by using
the Intellectual Property, less the sum of (a) discounts allowed in amounts
customary in the trade; (b) sales, tariff duties, or use taxes directly imposed
and with reference to particular sales; (c) outbound transportation prepaid or
allowed; and (d) amounts allowed or credited on returns.

1.4           Sub-License.  Licensee may sublicense the rights granted pursuant
to this Agreement without Licensor’s prior written consent.

 
 

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ARTICLE 2
LICENSOR’S REPRESENTATIONS AND WARRANTIES

2.1           Representations and Warranties of the Licensor.  The Licensor
represents and warrant to the Licensee, as of the Closing, that:

 
2.1.1
Licensor has full right, power and authority to enter into this Agreement and to
perform all of its obligations hereunder;

 
2.1.2
Licensor has full power and authority to license all of the rights, title and
interests contained in this Agreement; and

 
2.1.3
no provision of law and no contract to which Licensor is a party prevents
Licensor from performing the obligations hereunder.

2.2           Disclosure.  No representation or warranty made by the Licensor in
this Agreement, nor any document, written information, statement, financial
statement, certificate, or exhibit prepared and furnished or to be prepared and
furnished by the Licensor or its representatives pursuant hereto or in
connection with the transactions contemplated hereby, when taken together,
contains any untrue statement of a material fact, or omits to state a material
fact necessary to make the statements or facts contained herein or therein not
misleading in light of the circumstances under which they were furnished, to the
best of Licensor’s knowledge and belief.

2.3           Reliance.  The foregoing representations and warranties are made
by the Licensor with the knowledge and expectation that the Licensee is placing
reliance thereon.

ARTICLE 3
LICENSEE’S REPRESENTATIONS AND WARRANTIES

3.1           Representations and Warranties of the Licensee.  The Licensee
represents and warrant to the Licensor, as of the Closing, that:

 
3.1.1
Licensee has full right, power and authority to enter into this Agreement and to
perform all of its obligations hereunder; and

 
3.1.2
no provision of law and no contract to which Licensee is a party prevents
Licensee from performing the obligations hereunder.

3.2           Disclosure.  No representation or warranty made by the Licensee in
this Agreement, nor any document, written information, statement, financial
statement, certificate, or exhibit prepared and furnished or to be prepared and
furnished by the Licensee or its representatives pursuant hereto or in
connection with the transactions contemplated hereby, when taken together,
contains any untrue statement of a material fact, or omits to state a material
fact necessary to make the statements or facts contained herein or therein not
misleading in light of the circumstances under which they were furnished, to the
best of Licensee’s knowledge and belief.

 
 

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3.3           Reliance.  The foregoing representations and warranties are made
by the Licensee with the knowledge and expectation that the Licensor is placing
reliance thereon.

ARTICLE 4
CONFIDENTIALITY & NONDISCLOSURE
 
4.1           Obligations.  Each Party (the “Receiving Party”) acknowledges and
agrees that any business and technical information provided to the Receiving
Party by the other Party (the “Disclosing Party”) hereunder constitutes the
confidential and proprietary information of the Disclosing Party, and that the
Receiving Party's protection thereof is essential to this Agreement and a
condition to the Receiving Party's use and possession thereof.  The Receiving
Party shall retain in strict confidence and not disclose to any third party
(except as authorized by this Agreement) without the Disclosing Party's express
written consent, any and all such information.  Licensee acknowledges and agrees
that the Intellectual Property is confidential and proprietary information of
Licensor.

4.2           Exceptions.  The receiving Party shall be relieved of this
obligation of confidentiality to the extent any such information:

                        (i)   was in the public domain at the time it was
disclosed or has become in the public domain through no fault of the Receiving
Party;

                        (ii)  the Receiving Party can prove was known to the
Receiving Party, without restriction, at the time of disclosure as shown by the
files of the Receiving Party in existence at the time of disclosure;

                        (iii) is disclosed by the Receiving Party with the prior
written approval of the Disclosing Party;

                        (iv)  the Receiving Party can prove was independently
developed by the Receiving Party without any use of the Disclosing Party's
confidential information and by employees or other agents of the Receiving Party
who have not had access to any of the Disclosing Party's confidential
information; or

                        (v)   becomes known to the Receiving Party, without
restriction, from a source other than the Disclosing Party without breach of
this Agreement by the Receiving Party and otherwise not in violation of the
Disclosing Party's rights.

4.3           Notification of Security Breach.  The Receiving Party agrees to
notify the Disclosing Party promptly in the event of any breach of its security
under conditions in which it would appear that the trade secrets contained in
the Intellectual Property were prejudiced or exposed to loss.  The Receiving
Party shall, upon request of the Disclosing Party, take all other reasonable
steps necessary to recover any compromised trade secrets disclosed to or placed
in the possession of the Receiving Party by virtue of this Agreement.  The cost
of taking such steps shall be borne solely by the Receiving Party.
 
4.4           Injunctive Relief.  Each Receiving Party acknowledges that any
breach of any of
 

 
 

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its obligations with respect to confidentiality or use of the Disclosing Party's
confidential information hereunder is likely to cause or threaten irreparable
harm to the Disclosing Party, and, accordingly, the Receiving Party agrees that
in the event of such breach the Disclosing Party shall be entitled to seek
equitable relief to protect its interest therein, including but not limited to
preliminary and permanent injunctive relief, as well as money damages.
 
ARTICLE 5
INDEMNIFICATION
 
Each Party (the “Indemnifying Party”) agrees to indemnify, defend, and hold
harmless the other Party (the “Indemnified Party”) from and against any and all
claims, damages, and liabilities, including any and all expense and costs, legal
or otherwise, caused by the negligent act or omission of the Indemnifying Party,
its subcontractors, agents, or employees, incurred by the Indemnified Party in
the investigation and defense of any claim, demand, or action arising out of the
work performed under this Agreement; including breach of the Indemnifying Party
of this Agreement.  The Indemnifying Party shall not be liable for any claims,
damages, or liabilities caused by the sole negligence of the Indemnified Party,
its subcontractors, agents, or employees.

The Indemnified Party shall notify promptly the Indemnifying Party of the
existence of any claim, demand, or other matter to which the Indemnifying
Party’s indemnification obligations would apply, and shall give them a
reasonable opportunity to settle or defend the same at their own expense and
with counsel of their own selection, provided that the Indemnified Party shall
at all times also have the right to fully participate in the defense.  If the
Indemnifying Party, within a reasonable time after this notice, fails to take
appropriate steps to settle or defend the claim, demand, or the matter, the
Indemnified Party shall, upon written notice, have the right, but not the
obligation, to undertake such settlement or defense and to compromise or settle
the claim, demand, or other matter on behalf, for the account, and at the risk,
of the Indemnifying Party.

The rights and obligations of the Parties under this Article shall be binding
upon and inure to the benefit of any successors, assigns, and heirs of the
Parties.

ARTICLE 5
TERM AND TERMINATION
 
6.1            Term.  Unless this Agreement is terminated pursuant to Article
6.2 hereof or a Party gives at least 60 days written notice to the other Party
of its intent to terminate, the License granted hereunder shall remain in effect
for a term of three years beginning on the date hereof.  Moreover, this
Agreement shall automatically renew for succeeding terms of one year each unless
either Party gives notice to the other of its intention not to renew no later
than 30 days prior to the end of the then current term.  Licensee understands
that after the termination of this Agreement for any reason, it shall have no
right whatsoever to continue as a Licensee regardless of any undocumented
continuation of the relationship with Licensor.

6.2            Cause.  This Agreement may be terminated by either Party for
cause immediately upon the occurrence of any of the following events:
 
 (i)  If the other Party ceases to do business, or otherwise terminates its
business operations;

 
 

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(ii)  If the other Party shall fail to promptly secure or renew any license,
registration, permit, authorization or approval necessary for the conduct of its
business in the manner contemplated by this Agreement, or if any such license,
registration, permit, authorization or approval is revoked or suspended and not
reinstated within 60 days;

(iii)  If the other Party materially breaches any material provision of this
Agreement (including, but not limited to, Article 2 hereof) and fails to cure
such breach within 30 days (ten days in the case of a failure to pay and
immediately in the case of a breach of Article 3 hereof) of written notice
describing the breach; or

(iv)  If the other Party shall seek protection under any bankruptcy,
receivership, trust deed, creditors arrangement, composition or comparable
proceeding, or if any such proceeding is instituted against the other (and not
dismissed within 120 days).

6.3            Absolute Rights of Termination.  Each Party understands that the
rights of termination hereunder are absolute.  Neither Party shall incur any
liability or compensation obligation whatsoever for any damage (including,
without limitation, damage to or loss of goodwill or investment), loss or
expenses of any kind suffered or incurred by the other (or for any compensation
to the other) arising from or incident to any termination of this Agreement by
such Party that complies with the terms of the Agreement whether or not such
Party is aware of any such damage, loss or expenses.

6.4            Disposition of Property.  Upon termination of this Agreement by
either Party or naturally at the end of the term, all rights of Licensee
hereunder shall terminate, and Licensee shall immediately return to Licensor, or
destroy, at Licensor's option, all confidential information and any other
related materials in its possession, custody or control, in whichever form held
(including all copies or embodiments thereof), and will cease using any
trademarks, service marks and other designations of Licensor.  Licensee shall
certify to Licensor that the return or destruction of information has been
completed within 15 days of termination.

6.5            Survival.  The provisions of Articles 4, 5, and 8 shall survive
expiration or termination of this Agreement for any reason.

ARTICLE 7
INFRINGEMENT AGAINST THIRD PARTIES

In the event that either Party learns of imitations or infringements of the
Intellectual Property, that Party shall notify the other in writing of the
infringements or imitations.  Licensor shall have the right to commence lawsuits
against third persons arising from infringement of the Intellectual
Property.  In the event that Licensor does not commence a lawsuit against an
alleged infringer within 60 days of notification by Licensee, Licensee may
commence a lawsuit against the third party.  Before filing suit, Licensee shall
obtain the written consent of Licensor to do so and such consent shall not be
unreasonably withheld.  Licensor will cooperate fully and in good faith with
Licensee for the purpose of securing and preserving Licensee’s rights to the
Intellectual Property.  Any recovery (including, but not limited to, a judgment,
settlement or licensing agreement included as a resolution of an infringement
dispute) shall be divided equally between

 
 

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the Parties after deduction and payment of reasonable attorneys’ fees to the
party bringing the lawsuit.

ARTICLE 8
GENERAL PROVISIONS
 
8.1           Incorporation by Reference.  The recitals, schedules, exhibits,
and all documents (including, without limitation, all financial statements)
delivered as part hereof or incident hereto are incorporated as a part of this
Agreement by reference.

8.2           Relationship of the Parties.  The sole relationship between the
Parties shall be that of independent contractors.  Nothing herein shall be
construed to constitute the Parties as legal partners, joint ventures,
franchisees, or agents of each other, or impute any obligations, fiduciary or
otherwise, express or implied, in any way whatsoever, on either of the
Parties.  Neither Party shall make any warranties or representations, or assume
or create any obligations on the other Party's behalf except as may be expressly
permitted hereby and none have been made except as set forth herein.  Each Party
shall be solely responsible for the actions of its respective employees, agents,
and representatives.

8.3           Third Party Beneficiaries.  Nothing expressed or implied herein is
intended to confer, nor shall anything herein confer, upon any entity other than
the Parties and their respective successors and assigns any rights, remedies,
obligations or liabilities whatsoever.

8.4           Assignment.  The benefits and obligations of this Agreement shall
inure to and be binding upon the Parties and their respective successors and
permitted assigns.  Neither Party shall transfer or assign any of its rights or
delegate any of its obligations hereunder, in whole or in part, whether
voluntarily or by operation of law, without the prior written consent of the
other Party.  Any assignment or purported assignment in violation of this
Article shall be null and void.
 
8.5           Choice of Law.  This Agreement and the rights of the Parties
hereunder shall be governed by and construed in accordance with the laws of the
State of California including all matters of construction, validity,
performance, and enforcement and without giving effect to the principles of
conflict of laws.

8.6           Exclusive Jurisdiction and Venue.  The parties agree that the
Courts of the County of Orange, State of California shall have sole and
exclusive jurisdiction and venue for the resolution of all disputes arising
under the terms of this Agreement and the transactions contemplated herein.

8.7           Attorneys’ Fees.  In the event any Party hereto shall commence
legal proceedings against the other to enforce the terms hereof, or to declare
rights hereunder, as the result of a breach of any covenant or condition of this
Agreement, the prevailing Party in any such proceeding shall be entitled to
recover from the losing Party its costs of suit, including reasonable attorneys'
fees, as may be fixed by the court.
 
8.8           Notices.  Any notice, request, instruction, or other document
required by the terms of this Agreement, or deemed by any of the Parties hereto
to be desirable, to be given to any other Party hereto shall be in writing and
shall be given by personal delivery, overnight delivery, mailed by registered or
certified mail, postage prepaid, with return receipt requested, or sent by
facsimile transmission to the addresses of the Parties as follows:
 

 
 

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i.
To Licensor:
Material Technologies, Inc.
Attn: Robert M. Bernstein, Chief Executive Officer
11661 San Vicente Boulevard, Suite 707
Los Angeles, California 90049
Fax: (310) 473-3177

 
ii.
To Licensee:
Fatigue Solutions Corp.
Attn: Robert M. Bernstein, President
11661 San Vicente Boulevard, Suite 707
Los Angeles, California 90049
Fax: (310) 473-3177

 
iii.
With Copy To:
Oswald & Yap
Attn: Zach Reeves, Esq.
16148 Sand Canyon Avenue
Irvine, CA  92618
Fax: (949) 788-8980

 
The persons and addresses set forth above may be changed from time to time by a
notice sent as aforesaid.  If notice is given by personal delivery or overnight
delivery in accordance with the provisions of this Article, such notice shall be
conclusively deemed given at the time of such delivery provided a receipt is
obtained from the recipient.  If notice is given by mail in accordance with the
provisions of this Article, such notice shall be conclusively deemed given upon
receipt and delivery or refusal.  If notice is given by facsimile transmission
in accordance with the provisions of this Article, such notice shall be
conclusively deemed given at the time of delivery if during business hours and
if not during business hours, at the next business day after delivery, provided
a confirmation is obtained by the sender.

8.9           Amendment.  This Agreement shall not be amended, modified, or
supplemented by the Parties in any manner, by course of conduct or otherwise,
except by an instrument in writing signed on behalf of each Party.
 
8.10         Waiver.  Neither Party shall be deemed, by any act or omission,
course of conduct or otherwise, to have waived any of its rights or remedies
hereunder unless such waiver is in writing and signed by the waiving Party, and
then only to the extent specifically set forth in such writing.  A waiver with
reference to one event shall not be construed as continuing or as a bar to or
waiver of any right or remedy as to a subsequent event.
 
8.11         Headings.  The headings and captions used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement.
 
8.12         Construction.  This Agreement has been negotiated by the Parties
and their respective legal counsel at arm’s length and thus shall be interpreted
fairly in accordance with its terms and without any strict construction in favor
of or against either Party.
 
8.13         Severability.  In the event that any of the covenants herein
contained shall be held
 

 
 

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unenforceable or declared invalid for any reason whatsoever, such
unenforceability or invalidity shall not affect the enforceability or validity
of the remaining provisions of this Agreement and such unenforceable or invalid
portion shall be severable from the remainder of this Agreement.
 
8.14         Counterparts; Facsimile Signatures.  This Agreement may be executed
simul­taneously in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.  The Parties agree that facsimile signatures of this Agreement shall
be deemed a valid and binding execution of this Agreement.
 
8.15         Basis of Bargain.  EACH PARTY RECOGNIZES AND AGREES THAT THE
WARRANTY DISCLAIMERS AND LIABILITY AND REMEDY LIMITATIONS IN THIS AGREEMENT ARE
MATERIAL, BARGAINED FOR BASES OF THIS AGREEMENT AND THAT THEY HAVE BEEN TAKEN
INTO ACCOUNT AND REFLECTED IN DETERMINING THE CONSIDERATION TO BE GIVEN BY EACH
PARTY UNDER THIS AGREEMENT AND IN THE DECISION BY EACH PARTY TO ENTER INTO THIS
AGREEMENT.

8.16         Complete Agreement.  This Agreement and all exhibits hereto, all of
which are hereby incorporated herein by reference, constitute the entire
Agreement between the Parties with respect to the subject matter hereof, and
hereby supersedes all prior and contemporaneous, written or oral agreements and
understandings between the Parties with respect to such subject matter.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement, as of the
date first written hereinabove.

LICENSOR:

MATERIAL TECHNOLOGIES, INC.,
a Delaware corporation

 /s/ Robert M.
Bernstein                                                                           
By: Robert M. Bernstein
Its: Chief Executive Officer

LICENSEE:

FATIGUE SOLUTIONS CORP.,
a California corporation

 /s/ William
Berks                                                                           
By: William Berks
Its: Secretary

 
 

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