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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 22, 1997
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Mechanical Technology Incorporated
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(Exact name of registrant as specified in its charter)
New York
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(State or other jurisdiction of incorporation or organization)
0-6890 14-1462255
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(Commission File Number) (I.R.S. Employer Identification No.)
968 Albany-Shaker Road, Latham, New York 12110
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (518) 785-2211
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Item 2. Acquisition or Disposition of Assets
On September 22, 1997, Mechanical Technology Incorporated
("Registrant") executed a definitive agreement for the sale of the
L.A.B. division of Registrant to Noonan Machine Company ("NMC"), an
Illinois corporation, as of September 30, 1997 (the "Closing").
Pursuant to the agreement, Registrant agreed to sell the assets
(excluding an option on certain real property) and the liabilities
(excluding certain contingent liabilities) of the L.A.B. division,
to NMC, in exchange for a total purchase price of three million two
hundred and fifty thousand dollars ($3,250,000), subject to
adjustment as set forth below (the "Purchase Price"). The Purchase
Price is payable as follows: a) three hundred and fifty thousand
dollars ($350,000) was received into escrow as of September 22,
1997; b) two million two hundred and fifty thousand dollars
($2,250,000) is payable in cash, by wire transfer or by certified
check, in full, at the Closing, subject to adjustment if the net
tangible assets of the L.A.B. division are less than six hundred
and fifty thousand dollars ($650,000), as of September 30, 1997; c)
four hundred thousand dollars ($400,000) is payable pursuant to a
promissory note, payable in equal monthly installments of principal
and interest over a period of five years commencing as of the date
of Closing, at ten percent (10%) simple interest per annum, secured
by a blanket lien on all of the assets of NMC; and d) two hundred
fifty thousand dollars ($250,000) is payable pursuant to a
promissory note, payable in one balloon payment of principal and
interest at the end of one year, the principal amount of this note
shall be reduced if (i) all of the furniture, fixtures and
equipment of the L.A.B. division are offered for sale and sold in
a private sale to a purchaser other than NMC or any subsidiary or
affiliate of NMC, or at public auction (the "Sale"), and (ii) the
proceeds of such Sale does not exceed five hundred thousand
($500,000), in which case the principal amount due on the note
shall be reduced by the product of .5 multiplied by (five hundred
thousand dollars ($500,000) minus the proceeds of such Sale) (the
"Net Principal"); such note shall bear interest on the lesser of
two hundred and fifty thousand dollars ($250,000) or the Net
Principal (if applicable), a ten percent (10%) simple interest per
annum, commencing as of the date of Closing, such note shall also
be secured by a blanket lien on all of the assets of NMC. The
Purchase Price was determined based upon market factors. MTI will
use the proceeds of the sale to repay certain indebtedness and for
investment purposes.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
MECHANICAL TECHNOLOGY INCORPORATED
Date: September 23, 1997 By: /s/ Stephen T. Wilson
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Stephen T. Wilson
Chief Financial Officer
