matechexh10_65.htm


    
      
 


    Exhibit
10.65

     

    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.

     

    CLASS
A COMMON STOCK WARRANT AGREEMENT

     

    MATECH
CORP.,

    a
Delaware corporation (the “Company”)

     

    THIS IS
TO CERTIFY that, for value received, London Finance Group, Ltd., a California
corporation, or its assigns (collectively, the “Holder”) is entitled, subject to
the terms and conditions set forth herein, to purchase, 15,000,000 shares of
Class A common stock of the Company (the “Warrant Shares”) upon exercise at a
purchase price of the lesser of (i) $0.001 per share, or (ii) 50% of market
price (the “Warrant Price”).  This Warrant is issued under and in
accordance with the Settlement Agreement and General Release, dated June 16,
2008, between the Holder and the Company and is subject to the terms and
provisions contained therein, all of which are incorporated herein by this
reference.

     

    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 17th day of
October, 2008 and ending at 5:00 p.m., Pacific Time, on the 16th day of October,
2015 (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.  It is further agreed that the Warrant Shares are stated
after giving effect to a one for one-thousand reverse stock split completed in
October 2008.

     

    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


    
      
         


      

      
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    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 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, or a combination
thereof, at the election of Holder:

     

    (i)           Cash
Exercise: cash, bank or cashiers check, or wire transfer;

     

    (ii)          Cashless
Exercise:
surrender of the Election to Purchase form at the principal office of the
Company (by mail or facsimile) together with notice of cashless election, in
which event the Company shall issue Holder a number of shares of common stock
computed using the following formula:

     

                 
X = Y (A-B)/A

     

    where:  X
= the number of shares of common stock to be issued to Holder.

     

    Y = the
number of shares of common stock for which this Warrant is being
exercised.

     

    A = the
Market Price of one share of common stock (for purposes of this Section 3(ii),
the “Market Price” shall be defined as the average closing price of the common
stock for the five trading days prior to the date of exercise of this Warrant
(the “Average Closing Price”), as reported by the OTC Bulletin or in any
over-the-counter market, provided, however, that if the common stock is listed
on a stock exchange, the Market Price shall be the Average Closing Price on such
exchange for the five trading days prior to the date of exercise of the
Warrants.  If the common stock is/was not traded during the five
trading days prior to the date of exercise, then the closing price for the last
publicly traded day shall be deemed to be the closing price for any and all (if
applicable) days during such five trading day period.

     

    B = the
Exercise Price.

     

    For
purposes of Rule 144 and sub-section (d)(3)(ii) thereof, it is intended,
understood and acknowledged that the common stock issuable upon exercise of this
Warrant in a cashless exercise transaction shall be deemed to have been acquired
at the time this Warrant was issued.  Moreover, it is intended,
understood and acknowledged that the holding period for the common stock
issuable upon exercise of this Warrant in a cashless exercise transaction shall
be deemed to have commenced on the date this Warrant was
issued.


    
      
         


      

      
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    (iii)           Net
Issuance:  through a special sale and remittance procedure
(“Net Issuance Procedure”) pursuant to which the Holder (or any other person or
persons exercising the Warrant) shall concurrently provide irrevocable
instructions (a) to a Company-approved brokerage firm to effect the immediate
sale of the purchased shares and remit to the Company, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate
Warrant Price payable for the purchased shares plus all applicable Federal,
State and local income and employment taxes required to be withheld by the
Company by reason of such exercise and (b) to the Company to deliver the
certificates for the purchased shares directly to such brokerage firm in order
to complete the sale.

     

    Notwithstanding
the foregoing, in no event shall Holder be entitled to exercise any portion of
the Warrant to the extent that, after such exercise, the sum of (1) the number
of shares of common stock beneficially owned by the Holder, and (2) the number
of shares of common stock issuable upon the full or partial exercise of the
Warrant with respect to which the determination of this sentence is being made,
would result in beneficial ownership by Holder of more than 4.99% of the
outstanding shares of the Company’s common stock (after taking into account the
shares to be issued to Holder upon such exercise).  For purposes of
the immediately preceding sentence, beneficial ownership shall be determined in
accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended
(the “1934 Act”) ”), and Rule 13d-3 promulgated thereunder.  The
Holder further agrees that if the Holder transfers or assigns any of the Warrant
to any affiliate of such Holder, such transfer or assignment shall be made
subject to the transferee’s or assignee’s specific agreement to be bound by the
provisions of this provision.

     

    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.           RECAPITALIZATION.  Subject
to any required action by the stockholders of the Company, the number of Warrant
Shares covered by this Warrant, and the price per Share thereof, shall be
proportionately adjusted for any increase or decrease in the number of issued
Warrant Shares resulting from a subdivision or consolidation of shares or the
payment of a stock dividend, or any other increase or decrease in the number of
such shares affected without receipt of consideration by the Company; provided
however that the conversion of any convertible securities of the Company shall
not be deemed having been “effected without receipt of consideration by the
Company.”

     

    In the
event of a proposed dissolution or liquidation of the Company, a merger or
consolidation in which the Company is not the surviving entity, or a sale of all
or substantially all of the assets of the Company, at the option of the Holder,
the Holder shall be kept in a position equal to the Warrant by retaining the
Warrant or by receiving a similar option in any successor to the Company or,
alternatively, at the election of the Holder, shall be treated as if the Holder
had exercised his right to purchase all or part of the Warrant Shares
immediately prior to the consummation of the subject
transaction.


    
      
         


      

      
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    Subject
to any required action by the stockholders of the Company, if the Company shall
be the surviving entity in any merger or consolidation, this Warrant thereafter
shall pertain to and apply to the securities to which a holder of shares equal
to the Warrant Shares subject to this Warrant would have been entitled by reason
of such merger or consolidation.

     

    In the
event of a change in the shares of the Company as presently constituted, which
is limited to a change of all of its authorized shares without par value into
the same number of shares with a par value, the shares resulting from any such
change shall be deemed to be the shares within the meaning of this
Agreement.

     

    To the
extent that the foregoing adjustments relate to shares or securities of the
Company, such adjustments shall be made by the Board, whose determination in
that respect shall be final, binding and conclusive.  Except as
hereinbefore expressly provided, Holder shall have no rights by reason of any
subdivision or consolidation of share of stock of any class or the payment of
any stock dividend or any other increase or decrease in the number of shares of
stock of any class, and the number and price of shares subject to this Warrant
shall not be affected by, and no adjustments shall be made by reason of, any
dissolution, liquidation, merger or consolidation, or any issue by the Company
of shares of stock of any class or securities convertible into shares of stock
of any class.

     

    The grant
of this Warrant shall not affect in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations or changes in its capital
or business structure or to merge, consolidate, dissolve or liquidate or to sell
or transfer all or any part of its business or assets.

     

    5.           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.

     

    6.           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.

     

    7.           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


    
      
         


      

      
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    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.

     

    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:

     

    
      	 	
              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

            
	 	 	 	 
	 	To:	“Holder”	
              c/o
      Corporate Legal Services, LLP

              2224
      Main Street

              Santa
      Monica, CA 90405

              Fax:
      310 396 3290

            


    


     

    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.           AMENDMENTS.  This
Warrant may be amended only by a written agreement executed by all of the
Parties hereto.

     

    10.         COUNTERPARTS.  This
Warrant may be executed in any number of counterparts with the same effect as if
all signatories had signed the same document.  All counterparts shall
be construed together and constitute the same instrument.

     

    11.         HEADINGS.
The headings and captions used in this Warrant are used for convenience only and
are not to be considered in construing or interpreting this
Warrant.

     

    12.         EXCLUSIVE
JURISDICTION AND VENUE.  The Parties agree that the Courts of
the County of Los Angeles, State of California shall have sole and exclusive
jurisdiction and


    
      
         


      

      
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    venue for
the resolution of all disputes arising under the terms of this Agreement and the
transactions contemplated herein

     

    13.         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.

     

    14.         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.

     

    15.         ATTORNEYS’
FEES.  If any legal action or any other proceeding, including
arbitration or 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 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.

     

    16.         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.

     

    17.         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.

     

    18.         REPRESENTATIONS
OF HOLDER.

     

     
(a)           Holder
acknowledges that both the Warrant and the Warrant Shares will initially be
“restricted securities” (as such term is defined in Rule 144 promulgated under
the Securities Act of 1933, as amended) (“Rule 144”) and that the certificates
evidencing the Warrant Shares will include this legend:

     

    THE
SHARES (OR OTHER SECURITIES) REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933.  THE SHARES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF
COUNSEL


    
      
         


      

      
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    THAT AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.

     

    Holder
further acknowledges that the Warrant Shares cannot be sold unless registered
with the United States Securities and Exchange Commission and qualified by
appropriate state securities regulators, or unless Holder obtains written
consent from the Company and otherwise complies with an exemption from such
registration and qualification (including, without limitation, compliance with
Rule 144).

     

     
(b)           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.

     

      (c)           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.

     

      (d)           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.

     

      (e)                 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.

     

    IN
WITNESS WHEREOF, intending to be legally bound, the Parties hereto have
executed this Warrant Agreement on the 17th day of October,
2008.

     

                                                                                        


    
      
         


      

      
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        	 COMPANY: 	 	 	 HOLDER:	 
	 	 	 	 	 
	
                 MATECH
      CORP., 

                a
      Delaware corporation

              	 	 	
                 LONDON
      FINANCE GROUP, LTD.,

                a
      California corporation

              	 
	 	 	 	 	 
	
                /s/
      Robert M. Bernstein 

              	 	 	
                 

              	 
	
                By:
      Robert M. Bernstein 

              	 	 	
                By:

              	 
	
                Its:
      Chief Executive Officer

              	 	 	
                 

              	 


      

    

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    

      
        
           


        

        
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    FORM
OF ELECTION TO PURCHASE

     

    Matech
Corp.

    11661 San
Vicente Boulevard, Suite 707

    Los
Angeles, CA  90049

     

    (1)               o           The
undersigned hereby elects to purchase ________ shares of the Common Stock of
Matech Corp (the “Company”) pursuant to the terms of the attached Warrant and
tenders herewith payment of the exercise price in full, together with all
applicable transfer taxes, if any.

     

    o           The
undersigned hereby elects to purchase ________ shares of the Common Stock of the
Company pursuant to the terms of the cashless exercise or net issuance
provisions set forth in Section 2(ii) and 2(iii) of the attached Warrant, and
shall tender payment of all applicable transfer taxes, if
any.

     

    (2)           Please
issue a certificate or certificates representing said shares of Common Stock in
the name of the undersigned or in such other name as is specified
below:

     

    ________________________

    (Name)

    ________________________

    ________________________

    (Address)

     

    
      	
              ____________________________________

              (Date)

            	
              _____________________________________________

              (Signature)

               

              _____________________________________________

              (Print
      name)

            


    

     

     

     

     

     

     

     

     


    
      
         


      

      
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