Registration No. 33- 23617
SECURITIES AND EXCHANGE COMMISSION
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Material Technologies, Inc.
(Exact name of registrant as specified in its charter)
Delaware 95-4622822
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 707, 11661 San Vicente Boulevard, Los Angeles, CA 90049
(Address of Principal Executive Offices) (Zip Code)
Material Technologies, Inc., 1998 Stock Option Plan
(Full title of the plan)
Robert M. Bernstein, President, Material Technologies, Inc.
Suite 707, 11661 San Vicente Boulevard, Los Angeles, CA 90049
(Name and address of agent for service)
(310) 208-5589
(Telephone number, including area code, of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Proposed maximum
Title of securities Amount to be maximum offering aggregate offering Amount of
to be registered registered (1) price per share (2) price registration fee
- ------------------- ----------------- -------------------- ------------------- -----------------
<S> <C> <C> <C> <C>
Options to
Purchase Material
Technology, Inc.
Common Stock 800,000 Options 0 0 0
----------------- -------------------- ------------------- -----------------
Material
Technology, Inc.
Common Stock 800,000 Shares $ 1.3125 $ 1,050,000 $ 318.18
----------------- -------------------- ------------------- -----------------
Total $ 318.18
------------------- -----------------
<FN>
(1) In addition, under Rule 416(a) of the Securities Act of 1933, as amended, this Registration
statement also covers any additional securities issued in connection with a stock split or stock
dividend on the registered securities.
(2) July 20, 1998, average bid and asked price for Material Technologies, Inc.'s common stock on
the NASDAQ Bulletin Board in accordance with Rule 457(h) and (c) under the Securities Act of 1933,
as amended.
</TABLE>
<PAGE>
MATERIAL TECHNOLOGIES, INC.
MATERIAL TECHNOLOGIES, INC., 1998 STOCK OPTION PLAN
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents listed below are hereby incorporated by reference into this
registration statement, and all documents subsequently filed by Material
Technologies, Inc. (the "Company"), with the Securities and Exchange Commission
(the "Commission"), pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Securities Exchange Act of 1934, as amended, (the "Exchange Act") prior to the
filing of a post-effective amendment which indicates that all securities offered
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference in this registration statement and to
be a part hereof from the date of filing such documents:
(a) The Company's Registration Statement under the Securities Act of 1933, File
No. 33-23617, effective July 31, 1998.
(b) The Company's Form 10K for the year ended December 31, 1997.
(c) The Company's Form 10Q for the first quarter ended March 31, 1998.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of the registration
statement to the extent that a statement contained herein modifies or replaces
such statement. Any such statement shall not be deemed to constitute a part of
this registration statement except as so modified or replaced.
ITEM 4. DESCRIPTION OF SECURITIES.
Options to Purchase 800,000 Shares of the Company's Class A Common Stock and the
shares of Class A Common Stock to be issued upon exercise of such options
granted under the Company's 1998 Stock Option Plan.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Ninth paragraph of the Company's Articles of Incorporation and Article VII,
Section 3, of the Company's Bylaws permit the Company to indemnify its directors
to the fullest extent of Delaware law or the law of any other jurisdiction that
may be applicable.
Section 14 of the Delaware General Corporation Law permits a corporation, among
other things, to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation), by reason of the fact that he
is or was a director, officer, employee or agent of the corporation, or he is or
was serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred in connection with
such action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
A corporation also may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation. However, in such an action by or on behalf of a corporation, no
indemnification may be made in respect of any claims, issue or matter as to
which the person is adjudged liable to the corporation unless and only to the
extent that the court determines that, despite the adjudication of liability but
in view of all the circumstances, the person is fairly and reasonably entitled
to indemnity for such expenses which the court shall deem proper.
In addition, the indemnification and advancement of expenses provided by or
granted pursuant to Section 145 shall not be deemed exclusive of any other
rights to which those seeking indemnification or advancement of expenses may be
entitled under any by-law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office.
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit No. Description
<C> <S>
4 Material Technologies, Inc.'s 1998 Stock Option Plan
5 Opinion of Counsel
23(a) Consent of Counsel
</TABLE>
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(a)(1)(iii) To file, during any period in which offers or sales are being made,
a post-effective amend-ment to this registration statement to include any
material information with respect to the plan of dis-tribution not previously
disclosed in the registration statement or any material change to such
informa-tion in the registration statement;
(a)(2) That, for the purpose of determining any liability under the Securities
Act, each such post-ef-fective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offer-ing thereof;
(a)(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering;
(b) That, for purposes of determining any liability under the Securities Act,
each filing of the regis-trant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act that is incorporated by reference
in the registration statement shall be deemed to be a new registration
state-ment relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof; and
(h) Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to direc-tors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or other-wise, the registrant
has been advised that in the opinion of the Securities and Exchange Commis-sion,
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforce-able. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or control-ling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
ju-risdic-tion the question whether such indemnification by it is against public
policy as expressed in the Secu-rities Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Los Angeles, State of California on the 22nd day of
July, 1998.
MATERIAL TECHNOLOGIES, INC.
By: /S/ Robert M. Bernstein
------------------------------
Robert M. Bernstein, President
Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.
Signature: /S/ Robert M. Bernstein
------------------------------
Name and Title: Robert M. Bernstein,
Principal Executive Officer,
Principal Financial Officer,
Principal Accounting Officer
Date: July 22,1998
Signature: /S/ Joel Freedman
------------------------------
Name and Title: Joel Freedman
Director and Secretary
Date: July 22, 1998
<PAGE>
<TABLE>
<CAPTION>
INDEX TO EXHIBITS
Exhibit No. Description Page No.
- ------------ ------------------------------------------------ --------
<C> <S> <C>
4 Material Technology, Inc. 1998 Stock Option Plan
------------------------------------------------
5 Opinion of Counsel
------------------------------------------------
23(a) Consent of Counsel
- ------------ ------------------------------------------------ --------
</TABLE>
<PAGE>
MATERIAL TECHNOLOGIES, INC.
1998 STOCK OPTION PLAN
1. PURPOSE OF THE PLAN. The purpose of the Material Technologies, Inc. 1998
Stock Option Plan ("Plan") is to encourage ownership of the Common Stock of
Material Technologies, Inc., a Delaware corporation, ("Company") by key
employees, advisors, consultants, directors and officers providing service to
the Company and to provide increased incentive for such individuals to render
services to the Company in the future and to exert maximum effort for the
success of the Company's business.
2. DEFINITIONS. As used herein, and in any Option granted hereunder, the
following definitions apply:
a. "Board" means the Company's Board of Directors.
b. "Common Stock" means the Company's Class A Common Stock.
c. "Committee" means the Committee appointed by the Board in accordance with
paragraph (a) of Section 3 of this Plan. If no Committee is appointed,
"Committee" refers to the Board.
d. "Continuous Employment" or "Continuous Status as an Employee" means the
absence of any interruption or termination of employment by the Company or any
Subsidiary. Continuous Em-ployment shall not be considered interrupted by sick
leave, military leave or any other leave of absence approved by the Company, or
in the case of transfers between locations of the Company or between the
Company, its Subsidiaries or its successor.
e. "Employee" means any person, including officers, directors, employees,
advisors, and con-sultants employed by the Company or any Subsidiary on either a
full-time or part-time basis.
f. "Incentive Stock Option" means any Option granted under this plan, or any
other option granted to an Employee, which complies with the provision of
Section 422A of the Internal Revenue Code of 1986, as amended from time to time,
( the "Code").
f. "Non-Qualified Stock Option" means any Option granted under this Plan which
does not qualify in whole or in part as an "Incentive Stock Option" under
Section 422A of the Code.
g. "Option" means a stock option granted under the Plan.
h. "Optioned Shares" means Common Stock subject to an Option granted pursuant
to the Plan.
i. "Optionee" means a person who receives an Option under the Plan.
j. "Plan" means this 1998 Stock Option Plan.
k. "Share" means a share of Common Stock, as adjusted in accord with Section
8(i) of the Plan.
l. "Subsidiary" means any corporation (other than the Company) in an unbroken
chain of corpo-rations beginning with the Company if, at the time the Option is
granted, each of the cor-porations in the unbroken chain owns stock possessing
50 percent or more of the total combined voting power of all classes of stock in
one of the other corpora-tions in such chain.
3. ADMINISTRATION OF THE PLAN.
a. Procedure. The Board shall administer the Plan. The Board may appoint a
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Committee of not less than two Board members to administer the Plan, subject to
such terms and conditions as the Board may prescribe. Once appointed, the
Committee shall con-tinue to serve until the Board otherwise directs. From time
to time, the Board may increase the Committee size and appoint additional
members, fill va-cancies, however caused, and remove all members and thereafter
directly administer the Plan.
<PAGE>
PAGE 2
MATERIAL TECHNOLOGIES, INC.
1998 STOCK OPTION PLAN
Members of the Committee who are either eligible for Options or have been
granted Options may vote on any matters affecting Plan administration or
granting any Options under the Plan; provided that no such member shall act upon
the granting, amending, or modifying of an Op-tion to himself or herself, but
any such member may be counted in determining the existence of a quorum at any
meeting during which action is taken on granting an Option to him or her.
b. Powers of the Committee. The Committee shall have the author-ity (i) based
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on relevant information, to determine the fair market value of the Common Stock;
(ii) to determine the exercise price of Options to be granted (which price, in
the case of Incentive Stock Op-tions, shall be not less than the minimum
specified in Section 8(b) hereof), the Employees to whom and the time or times
at which Options shall be granted and the number of Shares to be represented by
each Option; (iii) to interpret the Plan; (iv) to prescribe, amend and rescind
rules and regulations relating to the Plan; (v) to determine the terms and
provisions of each Option granted (which need not be identical) and, with the
consent of the holder thereof, to modify or amend any Option; (vi) to authorize
any person to execute on the Company's be-half any instrument required to
effectuate grant of an Option previously granted; and (vii) to make all other
determinations deemed necessary or advisable for administering the Plan.
c. Effect of Committee's Decision. All decisions, determinations, and
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interpretations of the Committee shall be final and binding on all Optionees and
any other holders of any Options granted under the Plan.
4. STOCK RESERVED FOR THE PLAN, Subject to adjustment under paragraph 8(b) and
8(i) and to Section 9 hereof, a total of 800,000 shares of Class A Common Stock
shall be subject to the Plan. Such Shares shall be unissued or previously
issued shares re-acquired and held by the Company. The 800,000 Shares shall be
and are hereby reserved for sale for under the Plan. Any such shares which
remain unsold and which are not subject to outstand-ing Options when the Plan
terminates shall cease to be reserved for the Plan, but until termination, the
Company shall at all times reserve a sufficient number of shares to meet the
Plan's requirements. Should any Option expire or be canceled prior to its
exercise in full, the shares that were subject to such Option may again be made
subject to an Option under the Plan.
5. ELIGIBILITY. Incentive Stock Options may be granted only to Employees for a
reason connected with their employment by the Company. Non-Qualified Stock
Options may be granted to Employees for a reason connected with their employment
or other service to the Company. An Employee who has been granted an Incentive
Stock Op-tion or a Non-Qualified Stock Option, if he or she is otherwise
eligible, may be granted additional In-centive Stock Options or Non-Qualified
Stock Options.
6. FAIR MARKET VALUE LIMITATION. The aggregate fair market value (determined
at the time an Incen-tive Stock Option is granted) of the Common Stock with
respect to which any Incentive Stock Option may be ex-ercisable for the first
time by an Optionee during any calendar year (under this Plan and any other
Stock Option Plans of the Company and its Subsidiaries) shall not exceed
$50,000.
7. CONTINUATION OF EMPLOYMENT. The Plan shall not confer upon any Optionee any
right with respect to continuing employment with the Company, not shall it
interfere in any way with his or her right or the Company's right to terminate
his or her employment or other position at anytime.
8. TERMS AND CONDITIONS. Each Option granted under the Plan shall be evidenced
by an agreement, in a form approved by the Committee, which shall be subject to
the following express terms and conditions and to such other terms and
conditions as the Committee may deem appropriate.
a. Option Period. Each option agreement shall specify the period for which the
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Option is granted (which in no event shall exceed ten years from the date of
grant) and shall pro-vide that the Option shall expire at the end of such
period. In the case of Incentive Stock Op-tions, if the Optionee owns more than
ten percent (10%) of the outstanding stock of the Com-pany (determined in
accordance with Section 425(d) of the Code) on the date the Incentive Stock
Op-tion is granted, the option period shall not exceed five years from the date
of grant.
<PAGE>
PAGE 3
MATERIAL TECHNOLOGIES, INC.
1998 STOCK OPTION PLAN
b. Option Price. At the time the Option is granted, the Committee shall
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determine the purchase price of each Share subject to each Option granted. In
the case of Incentive Stock Options, such purchase price shall not be less than
the fair market value of a Share on the date the Option is granted, as
determined by the Committee; provided, however, that in the case of an Incentive
Stock Option granted to an Optionee who owns more than ten percent (10%) of the
outstanding stock of the Company (determined in accordance with Section 425(d)
of the Code) on the date the Option is granted, the option price shall not be
less than 110% of the fair market value of a Share on such date.
c. Exercise Period. No part of any Option may be exercised until the Optionee
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shall have re-mained in the employ of the Company or any of its Subsidiaries for
such period after the date on which the Option is granted as the Committee may
specify in the option agreement.
d. Procedure for Exercise. Options shall be exercised by the delivery of
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written notice to the Company setting forth the number of shares with respect to
which the Option is to be exercised. An Option may not be exercised for
fractional shares. Unless stock of the Company is used to acquire such shares
in accordance with paragraph 8(k), such notice shall be accompanied by cash,
check, bank draft, or postal or express money order payable to the order of the
Com-pany for an amount equal to the Option price of such shares and specifying
the address to which the certificates for such shares are to be mailed. As
promptly as practicable after receipt of such written notification and payment,
the Company shall deliver to the Optionee certificates for the number of shares
with respect to which such Option has been so exercised, issued in the
Op-tionee's name; provided, however, that such delivery shall be deemed effected
for all purposes when a stock transfer agent of the Company shall have deposited
such certificates in the United States mail, addressed to the Optionee, at the
address specified in the written notice of exercise. Until the issuance of the
stock certificates, no right to vote or receive dividends or any other rights as
a stockholder shall exist with respect to the optioned shares.
e. Termination of Employment. Unless otherwise agree to by the Board, if an
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Optionee ceases to be employed by the Company or any of its Subsidiaries for any
reason other than death or dis-ability, the Options granted to him shall
thereupon terminate. Any Options which are exercisable on the date of such
termination may be exercised during a three month period beginning on such date.
f. Disability or Death of Optionee. In the event of an Option holder's
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disability or death while employed by the Company, the Options pre-vi-ously
granted to him or her may be exercised (to the extent he or she would have been
entitled to do so at the date of disability or death) at any time and from time
to time, within one year after disability or death, by the executor or
adminis-trator of the Op-tionee's estate or by the person or per-sons to whom
his or her rights under the Option pass by will or the laws of descent and
dis-tribution, but in no event may the Option be exercised after it expires. An
Employee shall be deemed disabled if, a physician se-lected by the Committee,
opines that the Employee is incapable of performing services for the Company by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or to be of long, contin-ued and indefinite duration
lasting not less than 12 months.
g. No Rights as Stockholder. No Optionee shall have any rights as a
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stockholder with respect to shares covered by an Option until the date of
issuance of a stock certificate for such shares; ex-cept as provided in
paragraphs 8(h) or 8(i), no adjustment for dividends, or otherwise, shall be
made if the record date therefore is prior to the date of issuance of such
certificate.
h. Extraordinary Corporate Transactions; Adjustment for Recapitalizations,
- --------------------------------------------------------------------------------
Merger, etc. If the Company is dissolved or liquidated, or is merged or
consolidated into or with another corpora-tion, other than by a merger or
consolidation in which the Company is the surviving corporation, the then
exercisable but unexercised Options granted shall not be exercisable after the
date of such dissolution, liquidation, merger or consolidation, unless such
other surviving corporation makes provision for adopting the Plan and assuming
the Company's obli-gations under the Plan.
<PAGE>
PAGE 4
MATERIAL TECHNOLOGIES, INC.
1998 STOCK OPTION PLAN
Notwithstanding any provision of this Plan, in the event of a sale or transfer
of all or substan-tially all of the Com-pany's assets, or merger or
consolidation (other than a merger or consolida-tion in which the Company is the
surviving corporation and no shares are converted into or ex-changed for
securi-ties, cash, or any other thing of value), the Committee is authorized to
act as it determines to be necessary or advisable and fair and equitable to
Optionees, with respect to Op-tions held by Optionees. Such action may include
(but is not limited to the follow-ing):
(A) Accelerating the exercisability of any Option to permit its exercise in
full during such period as the Committee in its sole discretion shall prescribe
following the public announcement or a sale or transfer of assets or merger or
consolidation.
(B) Permitting an Optionee, at any time during such period as the Committee in
its sole discretion shall prescribe following consummation of such a merger,
consolidation or sale or transfer of assets, to surrender any Option or any
portion thereof for cancellation.
(C) Requiring any Optionee, at any time following such a merger,
con-solidation, or sales or transfer of assets, if required by the terms of the
agreements re-lat-ing thereto, to surren-der any Option (or any portion thereof)
to the Company in re-turn for a substitute Option which is issued by the
corporation surviving such merger or con-soli-dation or the Commit-tee, in its
sole discretion, determines to have a value to the Op-tionee substantially
equivalent to the value to the Optionee of the Option (or portion thereof) so
surrendered.
Subject to any action which the Committee may take pursuant to this para-graph
8(h) and 8(i), in the event of any merger, consolidation or sale or transfer of
as-sets re-ferred to in paragraph 8(h) or 8(i), upon any exercise thereafter, an
Optionee shall, at no additional cost other than payment of the exercise price
of the Option, be entitled to receive in lieu of Shares (1) the number and class
of Shares or other se-curity, or (2) the amount of cash, or (3) property, or (4)
a combination of the foregoing, to which the Optionee would have been entitled
pursuant to the terms of such merger, consolida-tion or sale or transfer of
assets, if immediately prior thereto the Optionee has been the holder of record
of the number of Shares for which such Option shall be so exercised.
i. Changes in Company's Capital Structure. The existence of outstanding
- ----------------------------------------------
Options shall not af-fect in any way the right or power of the Company or its
stockholders to make or authorize any or all adjustments, recapitalizations,
reorganizations, or other changes in the Company's capital structure or its
business, or any merger or consolidation of the Company or any issuance of
Common Stock or subscription rights thereto, or any issuance of bonds,
debentures, preferred or prior preference stock ahead of, or affecting, the
Common Stock or the rights thereof, or the dis-so-lution or liquidation of the
Company, or any sale or transfer of all or any part of its assets or business,
or any other corporate act or proceeding, whether of a similar character or
otherwise. Provided, however, that if the outstanding shares of Common Stock
shall at any time be changed or exchanged by declaring a stock dividend, stock
split, combination of shares, or recapitaliza-tion, the number and kind of
shares subject to the Plan or subject to any Options previously granted, and the
option prices, shall be appropriately and equitably adjusted to maintain the
pro-portionate number of shares without changing the aggregate option price.
j. Investment Representation. Each option agreement shall provide that, upon
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the Committee's de-mand for such representations, the Optionee or any person
exercising the Option shall, at the time of any exercise, deliver to the
Committee a written repre-sentation that the shares to be ac-quired are being
acquired for invest-ment and not for resale or with a view to the distribution
thereof. Upon such demand, delivery of such a representation prior to the
delivery of any shares issued upon exercise and prior to the expiration of the
option period shall be a condition prece-dent to the right of the Optionee or
such other person to purchase any shares.
<PAGE>
PAGE 5
MATERIAL TECHNOLOGIES, INC.
1998 STOCK OPTION PLAN
k. Payment with Stock. Subject to the Committee's approval, at the time of
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exercise, an Em-ployee may pay for any shares of Common Stock with respect to
which an Option is being exer-cised by tendering to the Company other shares of
Common Stock, provided however, that at the time of such exercise, the Company
shall have a Committee consisting of two (2) or more disin-terested directors
who shall approve the payment for option shares with other shares. The
certifi-cates representing such other shares of Common Stock must be
accom-panied by stock power duly executed with signature guaranteed. The value
of Common Stock so tendered shall be de-termined by the Committee in its sole
discretion. The Committee may, in its sole and absolute discretion, refuse any
tender of shares of Common Stock, in which case it shall deliver the ten-dered
shares back to the Employee and notify the Employee of such refusal.
l. Options Not Transferable. No Option or interest or right therein or part
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thereof shall be liable for the debts, contracts, or engagements of the Optionee
or his successors in interest or shall be subject to disposition by transfer,
alienation, anticipation, pledge, encumbrance, assignment or any other means
whether such disposition be voluntary or involuntary or by operation of law by
judgment, levy, attachment, garnishment, or any other legal or equitable
proceedings (including bankruptcy) and any attempted disposition thereof shall
be null and void and of no effect; pro-vided, however, that nothing in this
Section 8(l) shall prevent transfers by will or by the applica-ble laws of
descent and distribution.
9. AMENDMENTS OR TERMINATION. The Board of Directors may amend, alter or
discontinue the Plan, but no amendment or alteration shall be made which would
impair the rights of any participant under any Option previously granted without
the participant's consent, or which without the approval of the shareholders,
would: (i) except as provided in paragraphs 8(h) and 8(i) of the Plan, increase
the total number of shares reserved for purposes of the Plan or decrease the
option price provided for in para-graph 8(a) of the Plan or (ii) extend the
expiration date of this Plan in paragraph 11.
10. COMPLIANCE WITH OTHER LAWS AND REGULATIONS. The Plan, the grant and
exercise of Options thereunder, and the obligation of the Company to sell and
deliver shares under such Options, shall be subject to all applicable federal
and state laws, rules and regulations and to such approvals by the gov-ernmental
or regulatory agency as may be required. The Company shall not be required to
issue or de-liver any certificates for shares of Common Stock prior to the
completion of any registration or qualifi-cation of such shares under any
federal or state law, or any ruling or regulation of any governmental body which
the Company shall, in its sole discretion, determine to be necessary or
advisable. Further, it is the intention of the Company that the Plan comply in
all respects with the provisions of Rule 16b-3 of the Securities and Exchange
Act of 1934, as amended. If any Plan provision is found or determined not to be
in compliance with Rule 16b-3, the provision shall be deemed null and void.
11. EFFECTIVENESS AND EXPIRATION OF THE PLAN. The Plan shall be effective on
May 20, 1998. For the purpose of granting Options hereunder, this Plan shall
expire on May 20, 2008, ten years after the effec-tive date of the Plan and
thereafter no Option shall be granted pursuant to the Plan.
12. CANCELLATION AND ISSUANCE. The Committee may, at its sole discretion,
subject to the Plan, cancel outstanding Options and issue replacement Options
under terms and at exercise prices it deems benefi-cial to the Company and the
Optionees, to further the purposes of the Plan. Notwithstanding this para-graph
12, no Options may be canceled, or otherwise amended or modi-fied, without the
written consent of the Optionee.
<PAGE>
[PICTURE OF SCALES OF JUSTICE] LAW OFFICES OF
C. TIMOTHY SMOOT
Suite 174
23505 Crenshaw Boulevard
Torrance, California 90505-5221
Telephone: 310/530-3366 Telecopier: 310/530-2211
E-Mail: [email protected]
July 22, 1998
Board of Directors
Material Technologies, Inc.
Suite 707
11661 San Vicente Boulevard
Los Angeles, CA 90049
Re: Registration Statement on Form S-8
--------------------------------------
Gentlemen:
I am counsel to Material Technologies, Inc., a Delaware corporation, (the
"Corporation"), in connection with preparing and filing a Registration
Statement on Form S-8 (the "Registration Statement") with the Securities and
Exchange Commission (the "Commission"), registering under the Securities Act of
1933, as amended (the "Act"), 800,000 shares of the Corporation's Class A
Common Stock, $.001 par value, (the "Shares") issuable upon the exercise of
options and options to purchase these 800,000 Shares (the "Options") authorized
to be granted under the Corporation's 1998 Stock Option Plan (the "Plan").
For purposes of this opinion I have examined the Registration Statement,
the Corporation's Certificate of Incorporation, as amended, and its by-laws, and
such documents, records, agreements, proceedings, and legal matters as I deemed
necessary to examine. With respect to any documents or other corporate records
which I examined, I assumed the genuineness of all signatures on, and the
authenticity of, all documents submitted as originals, and the conformity to the
original documents submitted as copies.
Based upon my examination and subject to the qualifications stated herein,
I am of the opinion that:
1. The Corporation is duly organized, validly existing, and in good
standing under the laws of the State of Delaware.
2. The Shares included in the Registration Statement to be issued upon the
exercise of the Options will be duly authorized and validly issued, and fully
paid and non-assessable when the Options shall have been properly exercised and
the exercise price shall have been paid for the Shares in accordance with the
terms of the Plan.
I am a member of the California Bar and do not hold myself out as an expert
concerning, or qualified to render opinions with respect to any laws other than
the California law, the Federal laws of the United States, and Delaware General
Corporation Law.
Sincerely,
/S/ C. Timothy Smoot
C. Timothy Smoot
Attorney
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[PICTURE OF SCALES OF JUSTICE] LAW OFFICES OF
C. TIMOTHY SMOOT
Suite 174
23505 Crenshaw Boulevard
Torrance, California 90505-5221
Telephone: 310/530-3366 Telecopier: 310/530-2211
E-Mail: [email protected]
CONSENT OF COUNSEL
Material Technologies, Inc.
Suite 707
11661 San Vicente Boulevard
Los Angeles, CA 90049
C. Timothy Smoot, Esq., hereby consents to the use of his opinion dated
July 22, 1998, relating to Material Technologies, Inc., a Delaware cor-poration,
filing an S-8 Registration Statement with the Securities and Exchange Commission
to register 800,000 shares of Class A Common Stock of Material Technologies,
Inc., ("Matech") and options to purchase such Shares under the Corporation's
1998 Stock Option Plan and to filing Amendments to the S-8 Registration
Statement.
Torrance, California C. Timothy Smoot
July 22, 1998 C. Timothy Smoot, Attorney
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