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				EXHIBIT 10.1

						

						

						

						

						

						

					January 16, 2007

				

				Hyde Investments, Ltd.

				

				RE:          Conversion of Debenture

				                Issuance of Shares

				

				Gentlemen:

				

				Please accept this letter as confirmation of our agreement, as follows:

				

				Material Technologies, Inc. hereby agrees to pay Hyde Investments, Ltd. $500,000, the full amount of which shall be added to the Debenture amount as of January 10, 2007, in exchange for 1,000,000 shares of Material Technologies, Inc. common stock, which shall be delivered in five monthly installments of 200,000 shares each as instructed by Material Technologies, Inc.

				

				Thank you,

				

				Material Technologies, Inc.

				

				

				By:    /s/ Robert M. Bernstein            

				             Robert M. BernsteinExhibit 10.1

    
      

    

    
      Exhibit
        10.1 to Form 8-K

      FRONTIER
        BANK

      CHANGE
        OF CONTROL AGREEMENT

      

      This
        CHANGE OF CONTROL AGREEMENT (this “Agreement”) is made by and between FRONTIER
        FINANCIAL CORPORATION and FRONTIER BANK (hereinafter jointly referred to
        as the
“Bank”), and John J. Dickson (hereinafter referred to as “Executive”). The Bank
        and Executive are sometimes referred to herein as “the Parties.”

      

      WHEREAS,
        Executive has rendered valuable services to the Bank, and the Board of Directors
        of the Bank (the “Board”) desires to be assured that Executive will continue
        rendering such services to the Bank; and

      

      WHEREAS,
        the Board wishes to assure the Bank of continuity of management in the event
        of
        a Change of Control of the Bank; and

      

      WHEREAS,
        Executive desires assurance that Executive will be protected in the event
        of any
        Change of Control;

      

      NOW,
        THEREFORE, in consideration of the mutual covenants and promises herein,
        the
        Parties agree as follows:

      

      1.    Severance
        Benefits. 
        The Bank agrees that if there is a Change of Control of the Bank and the
        Bank
        terminates Executive’s employment other than for Cause, as defined below, or
        Executive terminates this Agreement for Good Reason, as defined below, within
        twenty-four (24) months after such Change of Control, Executive shall receive
        the benefits provided in Paragraphs 1.1
        and
1.2
        (the
“Severance Benefit”):

      

      1.1    Executive
        shall receive a lump sum payment equal to two (2) times Executive’s W-2
        compensation before salary deferrals (excluding any gains from stock-based
        compensation) over the twelve (12) months prior to the effective date of
        the
        Change of Control, less statutory payroll deductions on the first day of
        the
        seventh calendar month following the discontinuance of Executive’s employment
        due to a Change of Control; and

      

      1.2    Executive
        shall continue to be covered by all of the Bank’s medical and dental plans for
        twenty-four (24) months following discontinuance of Executive’s employment due
        to a Change of Control.

      

      2.    Termination
        Before Change of Control. 
If
        Executive’s employment is involuntarily terminated (other than for Cause, as
        defined below) or Executive dies or terminates employment due to disability
        as
        defined below on or after the date of the press release announcing the entering
        into of an agreement that will result in a Change of Control of the Bank,
        Executive shall be entitled to the Severance Benefits described in Section
        1,
        said
        benefits to be paid after the Change of Control actually occurs but no earlier
        than the first day of the seventh calendar month following the discontinuance
        of
        Executive’s employment due to a Change of Control. For purposes of this
        paragraph, “disability” shall be determined using the definition of that term in
        the Bank’s long-term disability plan in effect at the time of the disability, or
        if no such plan is then in effect, the definition of “disability” contained in
        such other plan providing a disability benefit. If there is no such plan
        then in
        effect, the definition of “disability” found in Internal Revenue Code Section
        22(e), as may be amended from time to time, shall apply.

      
        
          
          

        

        
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      Exhibit
        10.1 to Form 8-K

       

      3.    Consideration.

      

      3.1    The
        amounts
        paid to Executive hereunder shall be considered severance pay in consideration
        of the past services Executive has rendered to the Bank and in consideration
        of
        Executive’s continued service from the date hereof to the date of Executive’s
        entitlement to such payments, and in further consideration for the covenant
        not
        to compete/non-solicitation, as described in Section 13.

      

      3.2    Executive
        shall have no duty to mitigate the amount of any payment under this Agreement
        by
        seeking other employment. Should Executive actually receive earnings from
        any
        such other employment, the payments called for hereunder shall not be reduced
        or
        offset by any such future earnings.

      

      4.    Change
        of Control. 
        “Change of Control” as used herein will be deemed to have occurred when there is
        a Change in the Ownership of the Bank. For purposes of this Agreement, a
        Change
        in the Ownership of the Bank shall be deemed to occur when any one person,
        or
        more than one person acting as a group, acquires ownership of the Bank stock
        that, together with stock held by such person or group, constitutes more
        than
        fifty percent (50%) of the total fair market value or total voting power
        of the
        Bank. A Change in Ownership of the Bank will not occur when any one person,
        or
        more than one person acting as a group, owning more than fifty percent (50%)
        of
        the total fair market value or total voting power of the stock of the Bank
        acquires additional stock. For the purposes of this section, an increase
        in the
        percentage of stock owned by any one person, or more than one person if acting
        as a group, as a result of a transaction in which the Bank acquires its stock
        in
        exchange for property will be treated as an acquisition of stock.

      

      5.    Cause. 
        For purposes of this Agreement, “Cause” shall mean:

      

      5.1    The
        willful
        breach or habitual neglect of assigned duties related to the Bank, including
        compliance with the Bank’s policies, and such breach or neglect is materially
        detrimental to the Bank;

      

      5.2    Conviction
        (including any plea of nolo
        contendere)
        of
        Executive of any felony or crime involving dishonesty or moral
        turpitude;

      

      5.3    Any
        act of
        personal dishonesty knowingly taken by Executive in connection with Executive’s
        responsibilities as an employee and intended to result in personal enrichment
        of
        Executive or any other person;

      

      5.4    Bad
        faith
        conduct that is materially detrimental to the Bank;

      

      5.5    Inability
        of
        Executive to perform Executive’s duties due to alcohol or illegal drug
        use;

      
        
          
          

        

        
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      Exhibit
        10.1 to Form 8-K

       

      5.6    Executive’s
        failure to comply with any material legal written directive of the Board;
        or

      

      5.7    Any
        act or
        omission of Executive which is of substantial detriment to the Bank because
        of
        Executive’s intentional failure to comply with any statute, rule or regulation,
        except any act or omission believed by Executive in good faith to have been
        in
        or not opposed to the best interest of the Bank (without intent of Executive
        to
        gain, directly or indirectly, a profit to which Executive was not legally
        entitled) and except that Cause shall not mean bad judgment or negligence
        other
        than habitual neglect of duty.

      

      6.    Good
        Reason.
         For purposes of this Agreement, “Good Reason” means any one or more of the
        following: reduction of Executive’s base compensation without Executive’s
        consent (other than as part of an overall program applied uniformly to all
        members of senior management of the Bank); assignment of Executive to a position
        which provides Executive with significantly less responsibility; or the
        relocation or transfer of Executive’s principal place of employment to a
        different location in excess of thirty (30) miles of Executive’s then existing
        principal job location.

      

      7.    Effect
        on Other Benefits.  The
        arrangements called for by this Agreement are not intended to have any effect
        on
        Executive’s participation in any other benefits available to executive personnel
        or to preclude other compensation or additional benefits as may be authorized
        by
        the Board from time-to-time.

      

      8.    Voluntary
        Retirement. 
In
        the event Executive, after attaining age 60, voluntarily retires within twelve
        (12) months following a Change of Control of the Bank, Executive shall receive
        as a Severance Benefit a lump sum payment equal to one (1) times Executive’s W-2
        compensation before salary deferrals (excluding any gains from stock-based
        compensation) over the twelve (12) months prior to the effective date of
        the
        Change of Control. Such payment shall be made on the first day of the seventh
        calendar month after the discontinuance of Executive’s employment. In addition,
        Executive shall continue to be covered by all of the Bank’s medical and dental
        plans for twelve (12) months after the discontinuance of Executive’s
        employment.

      

      9.    Golden
        Parachute (FDIC). 
        The Bank shall not be obligated to make, and Executive shall not be entitled
        to,
        any payment under this Agreement if such payment would constitute a “golden
        parachute” payment prohibited by 12 U.S.C. 1828(k) or 12 CFR 359.0 et
        seq.
        The
        Bank shall have no liability to Executive under or in relation to this payment
        should any payment be deemed a prohibited “golden parachute”
payment.

      

      10.    Golden
        Parachute (IRS). 
        Executive is aware that under this Agreement payments made to Executive may
        constitute an “excess parachute payment” under Section 280G of the Internal
        Revenue Code, as amended, and thus would subject Executive to the Excise
        Tax
        under Internal Revenue Code Section 4999, as amended.

      

      11.    Binding
        Effect. 
        This Agreement shall be binding and shall inure to the benefit of the respective
        successors, assigns, legal representative and heirs of the Parties.

      

      12.    Miscellaneous. 
If
        any provision of this Agreement shall be held by a court of competent
        jurisdiction to be invalid or unenforceable, the remaining provisions shall
        continue to be fully effective. No provision of this Agreement may be modified
        or waived unless such waiver or modification is agreed to in writing by
        Executive and the Board. This is the entire agreement between the Parties
        and
        replaces any prior agreement regarding Change of Control. This Agreement
        shall
        be governed under the laws of the State of Washington.

      
        
          
          

        

        
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      Exhibit
        10.1 to Form 8-K

       

      13.   Covenant
        Not to Compete/Non-Solicitation. 
        Executive agrees that if Executive receives a Severance Benefit under this
        Agreement, the following shall apply:

      

      13.1    Executive
        shall not, for a period of two (2) years after termination of employment
        with
        the Bank, directly or indirectly become interested in, as a principal
        shareholder, director, or officer, any financial institution, now existing
        or
        organized hereafter, that competes or will compete with the Bank, including
        any
        successor, or any of the Bank’s affiliates within any county in which the Bank
        does business; provided, that Executive shall not be deemed a “principal
        shareholder” unless (i) Executive’s investment in such an institution exceeds 2%
        of the institution’s outstanding voting securities or (ii) Executive is active
        in the organization, management or affairs of such institution. The provisions
        restricting competition by Executive may be waived by action of the Board.
        Executive recognizes and agrees that any breach of this covenant by Executive
        will cause immediate and irreparable injury to the Bank, and Executive hereby
        authorizes recourse by the Bank to injunction and/or specific performance,
        as
        well as to the other legal or equitable remedies to which the Bank may be
        entitled.

      

      13.2    During
        the
        non-competition period described in Paragraph 13.1,
        Executive shall not solicit or attempt to solicit any other employee of the
        Bank
        or its affiliates to leave the employ of those companies, or in any way
        interfere with the relationship between the Bank and any other employee of
        the
        Bank.

      

      14.    Dispute
        Resolution.
         The Parties agree to attempt to resolve all disputes arising out of this
        Agreement by mediation. Any party desiring mediation may begin the process
        by
        giving the other party a written Request to Mediate, describing the issues
        involved and inviting the other party to join with the calling party to name
        a
        mutually agreeable mediator and a timeframe for the mediation meeting. The
        Parties and mediator may adopt any procedural format that seems appropriate
        for
        the particular dispute. The contents of all discussions during the mediation
        shall be confidential and non-discoverable in subsequent arbitration or
        litigation, if any. If the Parties can, through the mediation process, resolve
        the dispute(s), the agreement reached by the Parties shall be reduced to
        writing, signed by the Parties, and the dispute shall be at an end.

      

      If
        the
        result of the mediation is a recognition that the dispute cannot be successfully
        mediated, or if either party believes mediation would be unproductive or
        too
        slow, then either party may seek to resolve the dispute in accordance with
        the
        procedures established by Judicial Arbitration and Mediation Services,
        Inc.

      

      The
        award
        rendered by the arbitrator (whether through Judicial Arbitration and Mediation
        Services, Inc. or otherwise) shall be final, and judgment may be entered
        upon it
        in accordance with applicable law in any court having jurisdiction
        thereof.

      
        
          
          

        

        
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      Exhibit
        10.1 to Form 8-K

       

      The
        arbitrator shall allocate the costs charged by Judicial Arbitration and
        Mediation Services, Inc., or other arbitrator as the case may be, for the
        arbitration between the Parties in a manner which the arbitrator considers
        equitable. It is agreed that the arbitrator shall award to the prevailing
        or
        substantially prevailing party all fees incurred by such party with regard
        to
        such arbitration, including reasonable legal and accounting fees. If the
        arbitrator determines that there is no prevailing or substantially prevailing
        party, the legal and accounting fees shall be the responsibility of each
        party.

      

      Notwithstanding
        the above, if Executive violates Section 13
        above,
        the Bank will be entitled, in addition to the rights set forth heretofore,
        to
        commence legal action in a court of competent jurisdiction to obtain a
        temporary, primary and permanent injunction in order to prevent or restrain
        the
        breach of Section 13,
        and the
        Bank will not be required to post a bond as a condition to the granting of
        any
        such relief.

      

      15.    Independent
        Legal Counsel. 
        Executive acknowledges that they have had the opportunity to review and consult
        with their own personal legal counsel regarding this Agreement.

      

      16.    Termination. 
        This Agreement shall terminate immediately and without notice (1) upon the
        voluntary or involuntary termination of Executive’s employment, death or
        disability (as defined in Section 2)
        occurring prior to the date of the press release announcing the entering
        into an
        agreement that will result in a Change of Control of the Bank; or (2) if
        Executive’s employment with the Bank is reduced to part time (defined for
        purposes of this Agreement as less than thirty (30) hours per work week)
        other
        than due to short-time disability or medical leave; or (3) upon written notice
        to Executive if Executive’s duties and responsibilities are reduced
        significantly as determined by the Personnel Committee of the Board of
        Directors.

      

      17.    Compliance
        with Internal Revenue Code Section 409A. 
        Where required, the provisions of this Agreement are intended to comply with
        the
        requirements of Section 409A of the Internal Revenue Code. Notwithstanding
        any
        other provision of this Agreement, this Agreement shall be interpreted and
        administered in accordance with the requirements of Section 409A of the Internal
        Revenue Code.

      

      IN
        WITNESS WHEREOF, the Parties have signed this Agreement this 17th day of
        January, 2007.

      

      
        	
                FRONTIER
                  FINANCIAL CORPORATION

                FRONTIER
                  BANK

              	 	
                EXECUTIVE

              
	 	 	 	 
	
                By:

              	
                    /s/
                  Robert
                  J. Dickson

              	 	
                    /s/ 
John
                  J. Dickson

              
	 	
                Robert
                  J. Dickson

              	 	
                John
                  Dickson, President and CEO

              
	 	
                Chairman
                  of the Board

              	 	 

      

       

       

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