matechexh10_54.htm


    
      
        

      
Exhibit
10.54

    


    THE
SECURITIES REPRESENTED BY THIS DOCUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (“THE ACT”), OR THE SECURITIES LAWS OF ANY
STATE, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT AND ANY APPLICABLE STATE LAWS, (ii) TO THE EXTENT APPLICABLE, RULE
144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION
OF SECURITIES), OR (iii) AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE
REASONABLY SATISFACTORY TO COUNSEL TO THE ISSUER, THAT AN EXEMPTION FROM
REGISTRATION UNDER THE ACT AND APPLICABLE STATE LAW IS AVAILABLE.

     

    WARRANT
AGREEMENT

     

    MATERIAL
TECHNOLOGIES, INC.,

    a
Delaware corporation (the “Company”)

    


    THIS IS
TO CERTIFY that, for value received, Bank Julius Baer & Co. (Julius Baer
Hong Kong), or its assigns (collectively, the “Holder”) is entitled, subject to
the terms and conditions set forth herein, to purchase, 770,000 shares of Class
A common stock of the Company (the “Warrant Shares”) upon exercise at a purchase
price of $0.20 per Warrant Share (the “Warrant Price”).

    


    1.           TERM.  Subject
to the terms of this Warrant, the Holder shall have the right, at any time
during the period commencing at 9:00 a.m., Pacific Time, on the 19th day of
August, 2008 and ending at 5:00 p.m., Pacific Time, on the 18th day of August,
2009 (the “Termination Date”), to purchase from the Seller the Warrant Shares
upon payment to the Seller of the Warrant Price.

    


    Notwithstanding
anything to the contrary contained in this Warrant or otherwise, the Holder
shall not be required, although it shall have the right, to exercise this
Warrant.

    


    2.           MANNER OF
EXERCISE.  Payment of the aggregate Warrant Price shall be made
as described below.  Upon the payment of all or a portion of the
Warrant Price and delivery of the Election to Purchase, a form of which is
attached hereto, the Company shall issue and cause to be delivered with all
reasonable dispatch to or upon the written order of the Holder, and in such name
or names as the Holder may designate, a certificate or certificates for the
number of full Warrant Shares so purchased upon each exercise of the
Warrant.  Such certificate or certificates shall be deemed to have
been issued and any person so designated to be named therein shall be deemed to
have become a holder of record of such securities as of the date of surrender of
the Warrant (or if less than the entire Warrant is exercised, upon the delivery
of the new Warrant described below) and payment of the Warrant Price, as
aforesaid, notwithstanding that the certificate or certificates representing
such securities shall not actually have been delivered or that the stock
transfer books of the Company shall then be closed.  The Warrant shall
be


    
      
         


      

      
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    exercisable,
at the election of each Holder, either in full or from time to time in part and,
in the event that a certificate evidencing the Warrant is exercised in respect
of less than all of the Warrant Shares specified therein at any time prior to
the Termination Date, a new certificate evidencing the remaining portion of the
Warrant shall be issued by the Company to such Holder.

    


    Payment
of the Warrant Price may be made by either of the following forms, or a
combination thereof:

    


    (i)           Cash
Exercise: cash, bank or cashiers check, or wire transfer payable to the
Company; or

    


    (ii)           Promissory
Note: through a promissory note payable to the Company, but only to the
extent authorized by the Company, and which authorization may be withheld for
any reason whatsoever.

    


    3.           NO STOCKHOLDER
RIGHTS.  Unless and until this Warrant is exercised, this
Warrant shall not entitle the Holder hereof to any voting rights or other rights
as a stockholder of the Company, or to any other rights whatsoever except the
rights herein expressed, and, no dividends shall be payable or accrue in respect
of this Warrant.

    


    4.           EXCHANGE.  This
Warrant is exchangeable upon the surrender hereof by the Holder to the Company
for new Warrants of like tenor representing in the aggregate the right to
purchase the number of securities purchasable hereunder, each of such new
Warrants to represent the right to purchase such number of securities as shall
be designated by the Holder at the time of such surrender.

    


    Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction or mutilation of this Warrant, and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it and
reimbursement to the company of all reasonable expenses incidental thereto, and
upon surrender and cancellation hereof, if mutilated, the Company will make and
deliver a new warrant of like tenor and amount, in lieu hereof.

    


    5.           ELIMINATION OF FRACTIONAL
INTERESTS.  The Company shall not be required to issue
certificates representing fractions of securities upon the exercise of this
Warrant, nor shall it be required to issue scrip or pay cash in lieu of
fractional interests.  All fractional interests shall be eliminated by
rounding any fraction up to the nearest whole number of securities, properties
or rights receivable upon exercise of this Warrant.

    


    6.           RESERVATION AND LISTING OF
SECURITIES.  The Company shall at all times reserve and keep
available out of its authorized shares of common stock or other securities,
solely for the purpose of issuance upon the exercise of this Warrant, such
number of shares of common stock or other securities, properties or rights as
shall be issuable upon the exercise hereof.  The Company covenants and
agrees that, upon exercise of this Warrant and payment of the Warrant Price, all
shares of common stock and other securities issuable upon such exercise shall be
duly and validly issued, fully paid, non-assessable and not subject to the
preemptive rights of any stockholder.


    
      
         


      

      
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    8.           NOTICE.  Any
notice, request, instruction, or other document required by the terms of this
Warrant, 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:

    


    
      	
               
      

            	
              i.

            	
              To:

            	
              “Company”

            	
              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:	“Holder”	
              Bank
      Julius Baer & Co.

              _________________________________

              _________________________________

              _________________________________

              Fax:______________________________

            


    

     

    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 Section, 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 Section, 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 Section, 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.

    


    9.           GOVERNING
LAW.  This Warrant shall be governed, construed and interpreted
under the laws of the state of California, without giving effect to the rules
governing conflicts of law.

    


    10.          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.

    


    11.          SUCCESSORS.  All
the covenants and provisions of this Warrant shall be binding upon and inure to
the benefit of the Company, the Holder and their respective legal
representatives, successors and assigns.

    


    12.         ATTORNEYS’
FEES.  If any legal action or any other proceeding, including
any action for declaratory relief, is brought for the interpretation or
enforcement of this Warrant, the prevailing party shall be entitled to recover
reasonable attorneys’ fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it may be
entitled.  “Prevailing Party” shall include without limitation (a) a
Party who dismisses an action in exchange for sums allegedly due; (b) the Party
who receives performance from the other Party of an alleged
breach


    
      
         


      

      
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    or a
desired remedy that is substantially equivalent to the relief sought in an
action or proceeding; or (c) the Party determined to be the prevailing Party by
an arbitrator or a court of law.

    


    13.         NOTICE OF RIGHT TO
COUNSEL.  Each of the Parties has had the opportunity to, and
has had, this Warrant reviewed by their respective attorney.  Each of
the Parties affirms to the other that they have apprised themselves of all
relevant information giving rise to this Warrant and has consulted and discussed
with their independent advisors the provisions of this Warrant and fully
understands the legal consequences of each provision.  Each Party
further affirms to the other that they have not, and do not, rely upon any
representation of advice from the other or from the other Parties’
counsel.

    


    14.         REPRESENTATIONS OF
HOLDER.

    


    (a)           Holder
has adequate means of providing for current needs and contingencies, has no need
for liquidity in the investment, and is able to bear the economic risk of an
investment in the Warrant Shares offered by Company of the size
contemplated.  Holder represents that Holder is able to bear the
economic risk of the investment and at the present time could afford a complete
loss of such investment.  Holder has had a full opportunity to inspect
the books and records of the Company and to make any and all inquiries of
Company officers and directors regarding the Company and its business as Holder
has deemed appropriate.

     

    (b)           Holder
is an “Accredited Investor” as defined in Regulation D of the Securities Act of
1933 (the “Act”) or Holder, either alone or with Holder’s professional advisers
who are unaffiliated with, have no equity interest in and are not compensated by
Company or any affiliate or selling agent of Company, directly or indirectly,
has sufficient knowledge and experience in financial and business matters that
Holder is capable of evaluating the merits and risks of an investment in the
Warrant Shares offered by Company and of making an informed investment decision
with respect thereto and has the capacity to protect Holder’s own interests in
connection with Holder’s proposed investment in the Warrant Shares.

     

    (c)           Holder
is acquiring the Warrant Shares solely for Holder’s own account as principal,
for investment purposes only and not with a view to the resale or distribution
thereof, in whole or in part, and no other person or entity has a direct or
indirect beneficial interest in such Warrant Shares.

     

    (d)           Holder
will not sell or otherwise transfer the Warrant Shares without registration
under the Act or an exemption therefrom and fully understands and agrees that
Holder must bear the economic risk of Holder's purchase for an indefinite period
of time because, among other reasons, the Warrant Shares have not been
registered under the Act or under the securities laws of any state and,
therefore, cannot be resold, pledged, assigned or otherwise disposed of unless
they are subsequently registered under the Act and under the applicable
securities laws of such states or unless an exemption from such registration is
available.

    



    
      
         


      

      
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    IN WITNESS WHEREOF, intending
to be legally bound, the Parties hereto have executed this Warrant Agreement on
the 29th day of August, 2008.

     

     

    
      
        	COMPANY:	 	 	HOLDER:	 
	 	 	 	 	 
	
                MATERIAL TECHNOLOGIES,
      INC., 

                a
      Delaware corporation

              	 	 	BANK JULIUS BAER &
      CO.	 
	 	 	 	 	 
	
                 

              	 	 	
                 

              	 
	
                By:
      Robert M. Bernstein

              	 	 	
                By:

              	 
	
                Its:
      Chief Executive Officer 

              	 	 	
                Its:

              	 


      

       

       

       

       

       

       

       

       

       

      


      
        
          
             


          

          
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    FORM
OF ELECTION TO PURCHASE

    


    The
undersigned, a Holder of the attached Warrant, hereby irrevocably elects to
exercise the purchase right represented by the attached Warrant Agreement for,
and to purchase shares of common stock of Material Technologies, Inc., a
Delaware corporation and herewith makes payment of $__________ therefor, and
requests that the certificates for such securities be issued in the name of, and
delivered to_________________________, whose address is
______________________________________.

    
 

    
      
        	Dated:__________________________ 	Signature	 
	 	 	 
	
                 

              	 	 
	 	(Signature
      must conform in all respects to name	 
	 	
                of
      Holder of such partial interest as specified on the 

                face
      of the Warrant Certificate)

              	 
	 	 	 
	 	 	 
	 	(Insert
      Social Security or Other	 
	 	Identifying
      Number of Holder)	 


      

       

       

       

       

       

       

       

    

     

    



    
      
         


      

      
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