Item 1.01 Entry into a Material
On June 28, 2010 Abakan Inc. (the “Company) entered into a
stock purchase agreement with Kennametal Inc. (“Kennametal”) pursuant to which
terms and conditions the Company was to purchase from Kennametal five hundred
and ninety six thousand eight hundred and thirteen (596,813) shares being a
forty one percent (41%) interest in Powdermet, Inc. (“Powdermet”) in exchange
for one million five hundred thousand dollars ($1,500,000) payable on even date.
The transaction was not consummated and on September 7, 2010 the Company and
Kennametal amended the stock purchase agreement to be effective June 28, 2010.
The amended terms and conditions of the stock purchase
agreement require that the Company pay an initial payment of five hundred
thousand dollars ($500,000) to Kennametal against the original purchase price
of $1,500,000 and the remainder on or before September 30, 2010. The amended
stock purchase agreement contains additional terms related to monthly
liquidated damages in the amount of fifty thousand ($50,000) a month in the
event the Company is tardy in making the final installment on the purchase
price. The transaction must close no later than December 31, 2010.
Powdermet is the parent company of MesoCoat, Inc.
(“MesoCoat”), an Ohio based
nanotechnology materials science business, in which the Company holds a thirty
four percent (34%) equity interest with the option to acquire up to a seventy
five percent (75%) interest. Further, Andy Sherman serves as the chief
executive officer of each of Powdermet and MesoCoat in addition to his duties
as a member of the Company’s board of directors.
Formed in 1996, Powdermet is the winner of over 80 government-sponsored
Phase 1, 2 and 3 grant programs, and is transitioning from an engineered
nano-powder R&D lab into a commercial sector company. Powdermet’s own
product platform of advanced materials solutions are derived from
nano-engineered agglomerate technology including SComP™ and MComP™ energy
absorbing ultra-lightweight syntactic- and nano-composite metals.
Item 7.01 Regulation
The information contained herein includes a press release
attached to this current report in Item 9.01 as Exhibit 99 which is incorporated
by reference into this Item 7.01 in satisfaction of the public disclosure
requirements of Regulation FD. This information is “furnished” and not “filed”
for purposes of Section 18 of the Exchange Act, or otherwise subject to the
liabilities of that section. However, this information may be incorporated by
reference in another filing under the Exchange Act or the Securities Act only
if, and to the extent that, such subsequent filing specifically references the information incorporated by reference herein.