Los Angeles, CA - August 9, 2007
--Material
Technologies Inc., (OTCBB:
MTTG.OB -
News;) a developer of advanced technology
to monitor and measure metal fatigue, today announced that
it has issued a Special Letter to Shareholders in an effort
to update existing Material Technologies investors on the
current status of the Company, and more importantly, management's
perspective on the Company's future growth outlook. The text
from the letter follows:
Dear Shareholder,
I am writing today to bring you up to date on the progress being
made by Material Technologies Inc. (MATECH) toward meeting its
strategic goals. Bottom line: The news is good. MATECH has completed
its long technology-development phase and is now taking its technology
to market, with impressive results. Our list of current and potential
customers is growing, and Wall Street is taking notice.
As I write this, MATECH stock is up more than 29% over just
the past week. Granted, it has been an eventful week for our
industry, with the tragic highway bridge collapse in Minneapolis
raising fresh concerns about the safety of bridges all over the
nation and generating significant media attention for us. But
I believe that investors also see MATECH's signature technology,
the Electrochemical Fatigue Sensor (EFS) system, as the best
means available to address those safety concerns quickly and
cost-effectively.
We recently received another vote of investor confidence from
an important and influential group of money managers. European
institutional investment firms exercised MATECH warrants they
had received in a round of equity financing earlier this year.
Included here were big names, such as Julius Baer Asset Management
of Switzerland and Anima Funds of Italy. The fund managers cited
the potential of MATECH's EFS technology to detect cracks in
aging bridges and infrastructure in the U.S. and Europe. One
of them, Julius Baer Executive Director Alexander Shalash, foresaw
a "renewed spending cycle" to repair aging U.S. infrastructure
and said MATECH is "favourably positioned to benefit" from
it.
Of course, the warrant exercise also helps us by adding to our
capital. With our low burn rate and our expectation of rapid
revenue growth in the near term, we are now confident that we
have sufficient funds to finance our operations for the foreseeable
future. In short, we are poised for rapid growth, starting now.
Already, the EFS system has been used by highway departments
in Pennsylvania, Utah, Massachusetts and New Jersey. The Pennsylvania
deployment is the farthest along, with MATECH benefiting from
an "on-call" inspection contract under which the state
could use the EFS system as needed, anywhere in the state. Five
such inspections have been completed, and several more were under
way this summer. And this is just scratching the surface. According
to 2006 figures from the Federal Highway Administration, 2,610
of Pennsylvania's 7,605 steel bridges are structurally deficient
and another 1,651 are functionally obsolete. We also have been
asked in recent months to demonstrate EFS in New York and to
use it for verifying crack repairs in Alabama. Overseas, we have
met with bridge owners in Australia, the U.K. and elsewhere and
they have expressed serious interest in using EFS.
These officials recognize - and many others will come to recognize
- that EFS is simply the best technology for testing bridges
when judged by accuracy, cost and ease of use. In laboratory
tests, it has detected metal-fatigue cracks as small as 0.0004
inch wide and 0.001 inch long. Cracks this size are far too small
to be picked up with visual inspection alone or by other methods
of inspection in use today, such as acoustic emission (the exciting
of metal structures and analysis of resulting sound waves). Eddy
current testing, which uses electromagnetic effects to inspect
metal structures, is effective at detecting small cracks, but
even it can miss cracks that EFS detects. Most importantly, it
cannot determine if the crack is growing. EFS can, and this is
a crucial advantage.
By measuring ongoing metal fatigue, EFS enables highway agencies
to focus on active cracks, which need immediate attention. Knowing
the difference is critical to both safety and cost-effectiveness.
It helps direct repair money to where it is most needed. Additionally,
the EFS is far more effective than these "health monitoring" systems
by providing direct measurement of fatigue crack activity. It
does this at a fraction of the cost of the extensive strain gauging
and modeling that the health monitoring systems use.
Another MATECH technology, the "Fatigue Fuse" sensor,
is available to fill the gaps between EFS inspections by monitoring
accumulated fatigue in real time. Each Fatigue Fuse, consisting
of several notched metal strips, is placed on a high-stress area
of a metal structure. As the structure experiences stresses and
strains, individual notches crack and separate at calibrated
fractions, thereby indicating the amount of fatigue life.
MATECH thus can offer highway agencies and private-sector bridge
owners (railroads, for instance) a full safety package based
on periodic inspection (EFS) and continuous monitoring (Fatigue
Fuse). With no other company providing comparable technology,
we have a huge, largely untapped market open to us. To give you
some idea of that market's size, in U.S. highway bridges alone,
here are some facts:
- Under federal law, nearly 190,000 steel highway bridges are
subject to inspection every two years. In other words, the number
of annual inspections for which EFS could be used is nearly 95,000.
According to federal data, 39% of the bridges in the U.S. are
structurally deficient or functionally obsolete.
In 2006, the Federal Highway Administration (FHWA) classified
39,496 steel highway bridges as structurally deficient. Another
34,951 were labeled functionally obsolete.
Over the past 10 years, on average, a bridge failure (closure
or collapse) occurs once a week on average in the U.S.
The average age of U.S. bridges is greater than 50 years, and
most bridges in the U.S. were designed for a 50-year life.
According to the Road Information Program® (TRIP), 26%
of U.S. bridges in 2005 were not designed to handle current
traffic levels or need major repairs. In the 11 Northeastern
states, 39% of bridges are structurally deficient or functionally
obsolete.
And this is just for the use of EFS on U.S. highway bridges.
It does not factor in the potential revenues from Fatigue Fuse,
or the use of EFS and/or Fatigue Fuse on railroad bridges and
other non-highway structures where metal fatigue is a critical
safety issue (these include oil rigs, nuclear power plants and
offshore docking stations). Surveying the current state of U.S.
infrastructure, and looking at the clear advantages of MATECH
technology, you can see why experienced investors are so positive
on the company's prospects.
I would like to close by thanking you for your interest in MATECH,
and saluting your foresight as an investor in promising but unheralded
technology. Your judgment about the prospects of EFS and MATECH
is now being rewarded, as you can see from the recent appreciation
in share prices. Wall Street is beginning to see what you have
seen all along: There is an urgent need for reliable and efficient
technology to ensure that bridges and other crucial structures
are safe, and MATECH has the technology that best meets this
need. I expect to be giving you more good news in the coming
months, as the company's growth story progresses and reaches
an ever-widening audience of investors.
Yours truly,
Robert M. Bernstein
Chief Executive Officer
Materials Technology, Inc. (MATECH)
Forward-Looking Statements: Except for the historical information
contained herein, the matters discussed in this press release
are forward-looking statements. Such statements are indicated
by words or phrases such as "believe," "will," "breakthrough," "significant," "indicated," "feel," "revolutionary," "should," "ideal," "extremely" and "excited." These
statements are made under "Safe Harbor" provisions
of the Private Securities Litigation Reform Act of 1995. Actual
results may differ materially from those described in forward-looking
statements and are subject to risks and uncertainties. See the
Company's filings with the Securities and Exchange Commission
including, without limitation, the Company's recent Form 10-K
and Form 10-Qs, which identify specific factors that may cause
actual results or events to differ materially from those described
in the forward-looking statements.
Contact:
Robert M. Bernstein
Material Technologies, Inc.
1.310.208.5589
matech@matechcorp.com or
or
Investor or Media Relations
Omar Tajyar, 818-382-9704
Cell: 818-201-7455
otajyar@irintl.com
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