KEY TECHNOLOGY INC
SC 13G/A, 1997-02-12
SPECIAL INDUSTRY MACHINERY (NO METALWORKING MACHINERY)
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                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  SCHEDULE 13G

                    Under the Securities Exchange Act of 1934
                               (Amendment No. 3)*

                              Key Technology, Inc.
                                (Name of Issuer)

                          Common Stock, $0.01 par value
                         (Title of Class of Securities)

                                   493143 10 1
                                 (CUSIP Number)


* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.

The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).

CUSIP No. 493143 10 1



<PAGE>


Item 1:  Name of reporting person; S.S. or I.R.S. identification no. of above
         person:

                  MKB Partnership; 94-2938280

Item 2:  Check the appropriate box if a member of a group:

                  (a) [x]
                  (b) [ ]

Item 3:  SEC use only:

Item 4:  Citizenship or place of organization:

                  United States of America

Number of shares beneficially owned by each reporting person with:

Item 5:  Sole voting power:

                  0

Item 6:  Shared voting power:

                  0


Item 7:  Sole dispositive power:

                  0

Item 8:  Shared dispositive power:

                  0


Item 9: Aggregate amount beneficially owned by each reporting person:

                  0

Item 10: Check box if the aggregate amount in row (9) excludes certain shares:

                  Not applicable

Item 11: Percent of class represented by amount in row 9:

                  0

Item 12: Type of reporting person:

                  PN


<PAGE>


Item 1(a)                  Name of Issuer:

                           Key Technology, Inc.


Item 1(b)                  Address of Issuer's Principal Executive Offices:

                           150 Avery Street
                           Walla Walla, WA 99362

Item 2(a)                  Name of Person Filing:

                           MKB Partnership


Item 2(b)                  Address of Principal Business Office, or, if none,
                           Residence:

                           150 Avery Street
                           Walla Walla, WA 99362

Item 2(c)                  Citizenship:

                           United States of America


Item 2(d)                  Title of Class of Securities:

                           Common Stock


Item 2(e)                  CUSIP Number:

                           493143 10 1


Item 3                     If this statement is filed pursuant to Rules 13d-1(b)
                           or 13d-2(b), check whether the person filing is a:

                           Not applicable



<PAGE>


Item 4   Ownership.

                           Not applicable

Item 5   Ownership of Five Percent or Less of a Class:

                           The reporting person has ceased to be the owner of 5%
                           of the Common Stock of Issuer.


Item 6   Ownership of More Than Five Percent on Behalf of Another Person:

                           Not applicable


Item 7   Identification and Classification of the Subsidiary which Acquired the
         Security Being Reported on by the Parent Holding Company:

                           Not applicable

<PAGE>

Item 8   Identification and Classification of Members of the Group:

                           Michael L. Shannon - IN
                           Kathryn S. Johnson - IN
                           Bruce L. Shannon - IN

Item 9   Notice of Dissolution of Group:

                           Not applicable


Item 10  Certification:

                           Not applicable




                                    SIGNATURE

         After reasonable inquiry and to the best of my knowledge and belief, I
         certify that the information set forth in this statement is true,
         complete, and correct.

                                         February 5, 1997

                                         MKB Partnership, a General Partnership


                                         By: /s/ Michael L. Shannon
                                         ---------------------------
                                         Michael L. Shannon
                                         General Partner

ATTENTION:  Intentional misstatements or omissions of fact constitute federal
            criminal violations (See 18 USC 1001)


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