<PAGE>

                                                                   Exhibit 10.29


                     SATCON REGISTRATION RIGHTS AGREEMENT
                     ------------------------------------


          This SatCon Registration Rights Agreement (this "Agreement") is made
                                                           ---------
and entered into as of October 21, 1999, between SatCon Technology Corporation,
a Delaware corporation (the "Company"), and Mechanical Technology Incorporated,
                             --------
a New York corporation (the "Purchaser").
                             ---------

          This Agreement is made pursuant to the Securities Purchase Agreement,
dated as of the date hereof among the Company and the Purchasers (the "Purchase
                                                                       --------
Agreement").
---------

          The Company and the Purchasers hereby agree as follows:

     1.   Definitions
          -----------

          Capitalized terms used and not otherwise defined herein shall have the
meanings given such terms in the Purchase Agreement.  As used in this Agreement,
the following terms shall have the following meanings:

          "Advice" has meaning set forth in Section 3(m) hereof.
           ------

          "Affiliate" means, with respect to any Person, any other Person that
           ---------
directly or indirectly controls or is controlled by or under common control with
such Person.  For the purposes of this definition, "control," when used with
                                                    -------
respect to any Person, means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "affiliated," controlling" and "controlled" have meanings
               ----------   -----------       ----------
correlative to the foregoing.

          "Aggregate Price" has the meaning set forth in Section 2(d) hereof.
           ---------------

          "AMEX" shall mean the American Stock Exchange.
           ----

          "Business Day" means any day except Saturday, Sunday and any day which
           ------------
shall be a legal holiday or a day on which banking institutions in the State of
New York generally are authorized or required by law or other government actions
to close.

          "Commission" means the Securities and Exchange Commission.
           ----------

          "Common Stock" means the Company's Common Stock, par value $0.01 per
           ------------
share.
<PAGE>

          "Effectiveness Date" means the earlier of the 180th day following the
           ------------------
(i) Primary Closing Date (with respect to the Common Stock and Underlying
Securities issuable upon the exercise of the Warrants issued on the Primary
Closing Date), (ii) Secondary Closing Date (with respect to the Common Stock and
Underlying Securities issuable upon the exercise of the Warrant issued on the
Secondary Closing Date or (iii) the fifth day after the Company has received
notice (written or oral) from the Commission that the Commission Staff will not
be reviewing the applicable Registration Statement or has no further comments on
the applicable Registration Statement.

          "Effectiveness Period" has the meaning set forth in Section 2(a)
           --------------------
hereof.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.
           ------------

          "Event" has the meaning set forth in Section 2(d) hereof.
           -----

          "Filing Date" means as soon as practicable but in no event later than
           -----------
the 90th day following the Primary Closing Date or the Secondary Closing Date,
as applicable.

          "Holder" or "Holders" means the holder or holders, as the case may be,
           ------
from time to time of Registrable Securities.

          "Indemnified Party"  has the meaning set forth in Section 5(c) hereof.
           -----------------

          "Indemnifying Party" has the meaning set forth in Section 5(c) hereof.
           ------------------

          "Initial Registration Statement" has the meaning set forth in Section
           ------------------------------
2(a) hereof.

          "Losses" has the meaning set forth in Section 5(a) hereof.
           ------

          "Nasdaq" shall mean the Nasdaq Stock Market.
           ------

          "NYSE" shall mean the New York Stock Exchange.
           ----

          "Person" means an individual or a corporation, partnership, trust,
           ------
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or political subdivision
thereof) or other entity of any kind.

          "Primary Closing Date" shall mean the Primary Closing Date as defined
           --------------------
in the Purchase Agreement.

          "Proceeding" means an action, claim, suit, investigation or proceeding
           ----------
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.

          "Prospectus" means the prospectus included in the Registration
           ----------
Statement (including, without limitation, a prospectus that includes any
information previously omitted

                                       2
<PAGE>

from a prospectus filed as part of an effective registration statement in
reliance upon Rule 430A promulgated under the Securities Act), as amended or
supplemented by any prospectus supplement, with respect to the terms of the
offering of any portion of the Registrable Securities covered by the
Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference in such Prospectus.

          "Registrable Securities" means the shares of Common Stock issued or
           ----------------------
issuable upon exercise of the Warrants, and any shares of the Company's capital
stock issued as a result of any stock split, stock dividend, recapitalization,
exchange or similar event; provided, that Registrable Securities shall not
include any such shares that are eligible for sale under Rule 144(k).

          "Registration Statement" means the Initial Registration Statement and
           ----------------------
any additional registration statements contemplated by Sections 2(a) and 7(d),
including (in each case) the Prospectus, amendments and supplements to such
registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference in
such registration statement.

          "Rule 144" means Rule 144 promulgated by the Commission pursuant to
           --------
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

          "Rule 158" means Rule 158 promulgated by the Commission pursuant to
           --------
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

          "Rule 415" means Rule 415 promulgated by the Commission pursuant to
           --------
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

          "Secondary Closing Date" shall have the meaning set forth in the
           ----------------------
Purchase Agreement.

          "Securities" means the Company's Common Stock issuable pursuant to the
           ----------
Purchase Agreement.

          "Securities Act" means the Securities Act of 1933, as amended.
           --------------

          "Special Counsel" means one special counsel to the Holders, for which
the Holders will be reimbursed by the Company to the extent provided in Section
4.

          "Trading Day" means a day on which the Nasdaq (or in the event the
           -----------
Common Stock is not traded on Nasdaq, such other securities market on which the
Common Stock is listed) is open for trading.

                                       3
<PAGE>

          "Underlying Shares" means the shares of Common Stock issuable upon
           -----------------
exercise of the Warrants.

          "Underwritten Registration or Underwritten Offering" means a
           --------------------------------------------------
registration in connection with which securities of the Company are sold to an
underwriter for reoffering to the public pursuant to an effective registration
statement.

          "Warrants" means the warrants issuable pursuant to the Purchase
           --------
Agreement.

     2.   Registration Requirements
          -------------------------

          (a)  Filing and Effectiveness Obligations.  On or prior to the Filing
               ------------------------------------
Date relating to each of the Primary Closing Date and the Secondary Closing
Date, the Company shall prepare and file with the Commission a Registration
Statement (the "Initial Registration Statement") which shall cover all
                ------------------------------
Registrable Securities issued to the Purchaser on such closing date for an
offering to be made on a continuous basis pursuant to a "Shelf" registration
statement under Rule 415. The Initial Registration Statement shall be on Form S-
3 or any successor form (except if the Company is not then eligible to register
for resale the Registrable Securities on Form S-3, in which case such
registration shall be on another appropriate form in accordance herewith,
subject to the reasonable consent of the original Holders of the Registrable
Securities). The Company shall (i) not permit any securities other than the
Registrable Securities and securities with respect to which there are
outstanding demand or "piggy-back" registration rights as of the date of filing
of each Initial Registration Statement to be included in the Initial
Registration Statement and (ii) use commercially reasonable efforts to cause the
Initial Registration Statement to be declared effective under the Securities Act
as promptly as possible after the filing thereof, and prior to the Effectiveness
Date, and, except as provided herein, to keep such Initial Registration
Statement continuously effective under the Securities Act until the date which
is two years after the date that such Initial Registration Statement is declared
effective by the Commission or such earlier date when all Registrable Securities
covered by such Initial Registration Statement have been sold or may be sold
without volume restrictions pursuant to Rule 144 as determined by counsel to the
Company pursuant to a written opinion letter, addressed to the Holders and the
Company's transfer agent to such effect (the "Effectiveness Period"). The number
                                              --------------------
of shares of Common Stock initially included in the Initial Registration
Statement with respect to each closing shall be the sum of the number of
Securities and shares of Common Stock that are then issuable upon the exercise
of the Warrants which were issued by the Company at such closing, without regard
to any limitation on the Investor's ability to exercise the Warrants. If at any
time the number of shares of Common Stock issuable pursuant to the Warrant is
adjusted in accordance with the terms thereof, and more shares are issuable
pursuant to the Warrants than remain available for sale pursuant to the Initial
Registration Statement, the Company shall immediately, but in no more than five
(5) Business Days, file a Registration Statement sufficient to register such
additional shares of Common Stock.

          (b)  Form S-3 Eligibility.  The Company represents and warrants that
               --------------------
it currently meets the registrant eligibility and transaction requirements for
the use of Form S-3 (for primary and secondary offerings) for the registration
of the sale of Registrable Securities by the Purchasers and any other Holders
and the Company shall file all reports required to be filed by

                                       4
<PAGE>

the Company with the Commission in a timely manner so as to maintain such
eligibility for the use of Form S-3.

     3.   Registration Procedures
          -----------------------

          In connection with the Company's registration obligations hereunder
arising out of the Primary Closing Date transactions and the Secondary Closing
Date transactions (but specifically excluding the Company's obligations under
Section 7(c) hereof which shall be governed by Section 7(c) of the Brown Simpson
Agreement, the Company shall:

          (a)  Preparation of Registration Statement.  Prepare and file with the
               -------------------------------------
Commission on or prior to each Filing Date a Registration Statement on Form S-3
or its successor form  (or if the Company is not then eligible to register for
resale the Registrable Securities on Form S-3 such registration shall be on
another appropriate form in accordance herewith (which shall include a Plan of
Distribution substantially in the form of Exhibit A annexed hereto.
                                          ---------

          (b)  Amendments.  (i)  Prepare and file with the Commission such
               ----------
amendments, including post-effective amendments, to the Registration Statement
as may be necessary to keep the Registration Statement continuously effective
for the Effectiveness Period and prepare and file with the Commission such
additional Registration Statements in order to register for resale under the
Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement,
and as so supplemented or amended to be filed pursuant to Rule 424 (or any
similar provisions then in force) promulgated under the Securities Act; (iii)
respond as promptly as possible to any comments received from the Commission
with respect to the Registration Statement or any amendment thereto and as
promptly as possible provide the Holders true and complete copies of all
correspondence from and to the Commission relating to the Registration
Statement; and (iv) comply in all material respects with the provisions of the
Securities Act and the Exchange Act with respect to the disposition of all
Registrable Securities covered by the Registration Statement during the
applicable period in accordance with the intended methods of disposition by the
Holders thereof set forth in the Registration Statement as so amended or in such
Prospectus as so supplemented.

          (c)  Notifications.  Notify the Holders of Registrable Securities to
               -------------
be sold, as promptly as possible (and, in the case of (i)(A) below, not less
than five (5) days prior to such filing and, in the case of (i)(C) below, not
later than the first Business Day after effectiveness) and (if requested by any
such Person) confirm such notice in writing no later than one (1) Business Day
following the day (i)(A) when a Prospectus or any Prospectus supplement or post-
effective amendment to the Registration Statement is proposed to be filed; (B)
when the Commission notifies the Company whether there will be a "review" of
such Registration Statement and whenever the Commission comments in writing on
such Registration Statement and (C) with respect to the Registration Statement
or any post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state governmental authority
for amendments or supplements to the Registration Statement or Prospectus or for
additional information; (iii) of the issuance by the Commission of any stop

                                       5
<PAGE>

order suspending the effectiveness of the Registration Statement covering any or
all of the Registrable Securities or the initiation of any Proceedings for that
purpose; (iv) of the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Registrable Securities for sale in any jurisdiction, or the initiation or
threatening of any Proceeding for such purpose; and (vi) of the occurrence of
any event that makes any statement made in the Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to the
Registration Statement, Prospectus or other documents so that, in the case of
the Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.

          (d)  Suspensions.   Use its reasonable efforts to avoid the issuance
               -----------
of, or, if issued, obtain the withdrawal of (i) any order suspending the
effectiveness of the Registration Statement or (ii) any suspension of the
qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, at the earliest practicable moment.

          (e)  Supplements and Post-Effective Amendments.  If requested by any
               -----------------------------------------
managing underwriter or the Holders of a majority in interest of the Registrable
Securities to be sold in connection with an Underwritten Offering, (i) promptly
incorporate in a Prospectus supplement or post-effective amendment to the
Registration Statement such information as the Company reasonably agrees should
be included therein and (ii) make all required filings of such Prospectus
supplement or such post-effective amendment as soon as practicable after the
Company has received notification of the matters to be incorporated in such
Prospectus supplement or post-effective amendment; provided, however, that the
                                                   --------  -------
Company shall not be required to take any action pursuant to this Section 3(e)
that would, in the opinion of counsel for the Company, violate applicable law or
if the Holders of a majority of the Registrable Securities consent to the delay
in taking, or the failure to take, any such action, which consent shall not be
unreasonably withheld.

          (f)  Copies of Registration Statement.  Furnish to each Holder,
               --------------------------------
without charge, at least one conformed copy of each Registration Statement and
each amendment thereto, including financial statements and schedules, all
documents incorporated or deemed to be incorporated therein by reference, and
all exhibits to the extent requested by such Person (including those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.

          (g)  Copies of Prospectus.  Promptly deliver to each Holder, without
               --------------------
charge, as many copies of the Prospectus or Prospectuses (including each form of
prospectus) and each amendment or supplement thereto as such Persons may
reasonably request; and the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders and any underwriters in connection with the offering and sale of the
Registrable Securities covered by such Prospectus and any amendment or
supplement thereto.

                                       6
<PAGE>

          (h)  Blue Sky.  Prior to any public offering of Registrable
               --------
Securities, use commercially reasonable efforts to register or qualify or
cooperate with the selling Holders, in connection with the registration or
qualification (or exemption from such registration or qualification) of such
Registrable Securities for offer and sale under the securities or Blue Sky laws
of such jurisdictions within the United States as any Holder or underwriter
requests in writing, to keep each such registration or qualification (or
exemption therefrom) effective during the Effectiveness Period and to do any and
all other acts or things necessary or advisable to enable the disposition in
such jurisdictions of the Registrable Securities covered by a Registration
Statement; provided, however, that the Company shall not be required to qualify
           --------  -------
generally to do business in any jurisdiction where it is not then so qualified
or to take any action that would subject it to general service of process in any
such jurisdiction where it is not then so subject or subject the Company to any
material tax in any such jurisdiction where it is not then so subject.

          (i)  Certificates.  Cooperate with the Holder to facilitate the timely
               ------------
preparation and delivery of certificates representing Registrable Securities to
be sold pursuant to a Registration Statement, which certificates shall be free,
to the extent permitted by applicable law and the Purchase Agreement, of all
restrictive legends, and to enable such Registrable Securities to be in such
denominations and registered in such names as any such managing underwriters or
Holders may request at least two (2) Business Days prior to any sale of
Registrable Securities.

          (j)  Supplements and Amendments.  Upon the occurrence of any event
               --------------------------
contemplated by Section 3(c)(vi), as promptly as possible, prepare a supplement
or amendment, including a post-effective amendment, to the Registration
Statement or a supplement to the related Prospectus or any document incorporated
or deemed to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, neither the Registration Statement
nor such Prospectus will contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

          (k)  Listing.  Cause all Registrable Securities relating to each
               -------
Registration Statement to be listed on Nasdaq and any other securities exchange,
quotation system, market or over-the-counter bulletin board, if any, on which
similar securities issued by the Company are then listed as and when required
pursuant to the Purchase Agreement.

          (l)  Earnings Statement.  Comply in all material respects with all
               ------------------
applicable rules and regulations of the Commission and make generally available
to its securityholders earning statements satisfying the provisions of Section
11(a) of the Securities Act and Rule 158 not later than 45 days after the end of
any 12-month period (or 90 days after the end of any 12-month period if such
period is a fiscal year), commencing on the first day of the first fiscal
quarter of the Company after the effective date of the Registration Statement,
which statement shall conform to the requirements of Rule 158.

          (m)  Information.  The Company may require each selling Holder to
               -----------
furnish to the Company information regarding such Holder and the distribution of
such Registrable Securities as is required by law to be disclosed in the
Registration Statement, and the Company

                                       7
<PAGE>

may exclude from such registration the Registrable Securities of any such Holder
who unreasonably fails to furnish such information within a reasonable time
after receiving such request.

          The Company shall hold in confidence and not make any disclosure of
information concerning a Holder provided to the Company unless (i) disclosure of
such information, in the opinion of counsel to the Company, is required by law,
(ii) the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (iii) disclosure of such
information is required by court or administrative order or is necessary to
respond to inquiries of regulatory authorities (provided, however, that the
                                                --------  -------
Holder shall be given notice of any such pending disclosure so that the Holder
may seek a protective order), or (iv) such information has been made generally
available to the public other than by disclosure in violation of this or any
other agreement.  The Company agrees that it shall, upon learning that
disclosure of such information concerning a Holder is sought in or by a court or
governmental body of competent jurisdiction or through other means, give prompt
notice to such Holder prior to making such disclosure, and allow the Holder, at
its expense, to undertake appropriate action to prevent disclosure of, or to
obtain a protective order for, such information.

          If the Registration Statement refers to any Holder by name or
otherwise as the holder of any securities of the Company, then such Holder shall
have the right to require (if such reference to such Holder by name or otherwise
is not required by the Securities Act or any similar Federal statute then in
force) the deletion of the reference to such Holder in any amendment or
supplement to the Registration Statement filed or prepared subsequent to the
time that such reference ceases to be required.

          Each Holder covenants and agrees that (i) it will not sell any
Registrable Securities under the Registration Statement until it has received
copies of the Prospectus as then amended or supplemented as contemplated in
Section 3(g) and notice from the Company that such Registration Statement and
any post-effective amendments thereto have become effective as contemplated by
Section 3(c) and (ii) it and its officers, directors or Affiliates, if any, will
comply with the prospectus delivery requirements of the Securities Act as
applicable to them in connection with sales of Registrable Securities pursuant
to the Registration Statement.

          Each Holder agrees by its acquisition of such Registrable Securities
that, upon receipt of a notice from the Company of the occurrence of any event
of the kind described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or
3(c)(vi), such Holder will forthwith discontinue disposition of such Registrable
Securities under the Registration Statement until such Holder's receipt of the
copies of the supplemented Prospectus and/or amended Registration Statement
contemplated by Section 3(j), or until it is advised in writing (the "Advice")
by the Company that the use of the applicable Prospectus may be resumed, and, in
either case, has received copies of any additional or supplemental filings that
are incorporated or deemed to be incorporated by reference in such Prospectus or
Registration Statement. Notwithstanding anything to the contrary, the Company
shall cause its transfer agent to deliver unlegended shares of Common Stock to a
transferee of a Holder in accordance with the terms of the Securities Purchase
Agreement in connection with any sale of Registrable Securities with respect to
which an Holder has entered into a contract for sale prior to the Holder's
receipt of a notice from the Company of

                                       8
<PAGE>

the happening of any event of the kind described in Section 3(c)(ii), 3(c)(iii),
3(c)(iv), 3(c)(v) or 3(c)(vi) and for which the Holder has not yet settled.

          (n)  Responses to the Commission.  The Company agrees to respond fully
               ---------------------------
and completely to any and all comments on a Registration Statement received from
the Commission staff as promptly as possible but, for non-Underwritten
Offerings, in no event later than ten (10) Business Days of the receipt of such
comments, regardless of whether such comments are in oral or written form.

          (o)  Confirmation of Effectiveness.  Within two (2) Business Days
               -----------------------------
after a Registration Statement which covers applicable Registrable Securities is
ordered effective by the Commission, the Company shall deliver, and shall cause
legal counsel for the Company to deliver, to the transfer agent for such
Registrable Securities (with copies to the Holders whose Registrable Securities
are included in such Registration Statement) confirmation that such Registration
Statement has been declared effective by the Commission in the form attached
hereto as Exhibit B.
          ---------

          (p)  Notwithstanding any other provision of this Section 3, the
Company may delay the filing or effectiveness of any Registration Statement or
any amendment or supplement thereto and suspend the right of the Holders to
effect sales of Registrable Securities thereunder for one or more periods (each
a "Suspension Period") of up to 60 calendar days in the aggregate per twelve
(12) month period in the event that such filing, effectiveness or sale would
require the Company to disclose any non-public information that the Company is
not otherwise required to disclose or to file any financial statements that the
Company is not otherwise required to file, provided however, that no Suspension
Period shall exceed 45 consecutive calendar days.

          (q)  Notwithstanding any other provision of this Section 3, the
Holders shall not be permitted to effect sales of the Registrable Securities
under a Registration Statement during a period in which the Company is engaged
in the process of registering under the Securities Act in an underwritten
offering, for as long as the underwriter reasonably considers is necessary.

     4.   Registration Expenses
          ---------------------

               All fees and expenses incident to the performance of or
compliance with this Agreement by the Company (other than Section 7(c) hereof
which will be governed by Section 7(c) of the Brown Simpson Agreement) shall be
borne by the Company, whether or not the Registration Statement is filed or
becomes effective and whether or not any Registrable Securities are sold
pursuant to the Registration Statement. The fees and expenses referred to in the
foregoing sentence shall include, without limitation, (i) all registration and
filing fees (including, without limitation, fees and expenses (A) with respect
to filings required to be made with Nasdaq and each other securities exchange or
market on which Registrable Securities are required hereunder to be listed and
(B) in compliance with state securities or Blue Sky laws (including, without
limitation, fees and disbursements of counsel for the Holders in connection with
Blue Sky qualifications as determined by a majority in interest of the Holders),
(ii) printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities and of printing prospectuses if the
printing of prospectuses is requested by the holders

                                       9
<PAGE>

of a majority of the Registrable Securities included in the Registration
Statement), (iii) messenger, telephone and delivery expenses, (iv) reasonable
fees and disbursements of counsel for the Company, (v) Securities Act liability
insurance, if the Company so desires such insurance, and (vi) fees and expenses
of all other Persons retained by the Company in connection with the consummation
of the transactions contemplated by this Agreement. In addition, the Company
shall be responsible for all of its internal expenses incurred in connection
with the consummation of the transactions contemplated by this Agreement
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit, and the fees and expenses incurred in connection with the listing of the
Registrable Securities on any securities exchange as required hereunder. The
Company shall not be required to pay selling concessions, discounts or other
compensation paid to brokers, underwriters or other agents in connection with
the sale of any Registrable Securities, whether or not incurred in an
Underwritten Offering, or fees and expenses incurred by a Holder that are not
specified in this Section.

     5.   Indemnification
          ---------------

          (a)  Indemnification by the Company.  The Company shall,
               ------------------------------
notwithstanding any termination of this Agreement, indemnify and hold harmless
each Holder, the officers, directors, agents (including any underwriters
retained by such Holder in connection with the offer and sale of Registrable
Securities), investment advisors and employees of each of them, each Person who
controls any such Holder (within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act) and the officers, directors, agents and
employees of each such controlling Person, to the fullest extent permitted by
applicable law, from and against any and all joint or several losses, claims,
damages, liabilities, costs (including, without limitation, costs of preparation
and attorneys' fees) and expenses (collectively, together with actions,
proceedings or inquiries by any regulatory or self-regulatory organization,
whether commenced or threatened, "Losses"), as incurred, arising out of or
relating to (i) any untrue or alleged untrue statement of a material fact
contained in the Registration Statement, any Prospectus or any form of
prospectus or in any amendment or supplement thereto or in any preliminary
Prospectus, or arising out of or relating to any omission or alleged omission of
a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus or form of prospectus or
supplement thereto, in light of the circumstances under which they were made)
not misleading (in the case of any Prospectus or form of prospectus or
supplement thereto, in light of the circumstances under which they were made),
except to the extent, but only to the extent, that such untrue statements or
omissions are based upon and in conformity with information regarding such
Holder furnished in writing to the Company by such Holder expressly for use
therein, or (ii) any violation or alleged violation by the Company of the
Securities Act, the Exchange Act, any other law, including, without limitation,
any state securities law, or any rule or regulation thereunder relating to the
offer or sale of Registrable Securities, provided, however, that the Company
shall not be required to indemnify any person with respect to a loss arising out
of a sale of any Registrable Securities during any period during which the
Company has advised the Holder to suspend sales pursuant to a registration
statement. The Company shall not, however, be liable for any Losses to any
Holder with respect to any untrue or alleged untrue statement of material fact
or omission or alleged omission of material fact if such statement or omission
was made in a preliminary Prospectus and such Holder did not

                                       10
<PAGE>

receive copy of the final Prospectus (or any amendment or supplement thereto) at
or prior to the confirmation of the sale of the Registrable Securities in any
case where such delivery is required by the Securities Act and the untrue or
alleged untrue statement of material fact or omission or alleged omission of
material fact contained in such preliminary Prospectus was corrected in the
final Prospectus (or any amendment or supplement thereto), unless the failure to
deliver such final Prospectus (as amended or supplemented) was a result of
noncompliance by the Company with Section 3(g) of this Agreement. The Company
shall notify the Holders promptly of the institution, threat or assertion of any
Proceeding of which the Company is aware in connection with the transactions
contemplated by this Agreement.

          (b)  Indemnification by Holder.  The Holder shall indemnify and hold
               -------------------------
harmless the Company, the directors, officers, agents and employees, each Person
who controls the Company (within the meaning of Section 15 of the Securities Act
and Section 20 of the Exchange Act), and the directors, officers, agents or
employees of such controlling Persons, to the fullest extent permitted by
applicable law, from and against all Losses, as incurred, arising solely out of
or based solely upon (i) any untrue statement of a material fact contained in
the Registration Statement, any Prospectus, or any form of prospectus, or
arising solely out of or based solely upon any omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading to the extent, but only to the extent, that such untrue statement or
omission is contained in any information so furnished in writing by such Holder
to the Company specifically for inclusion in the Registration Statement or such
Prospectus and that such information was reasonably relied upon by the Company
for use in the Registration Statement, such Prospectus or such form of
prospectus or to the extent that such information relates to such Holder or such
Holder's proposed method of distribution of Registrable Securities and was
reviewed and expressly approved in writing by such Holder expressly for use in
the Registration Statement, such Prospectus or such form of prospectus or (ii)
any violation or alleged violation by the Holders of the Securities Act, the
Exchange Act, any other law, including, without limitation, any state securities
law, or any rule or regulation thereunder relating to the offer or sale of
Registrable Securities; provided, however, that the indemnity agreement
                        --------  -------
contained in this Section 5(b) shall not apply to amounts paid in settlement of
any Losses if such settlement is effected without the prior written consent of
such Holder. In no event shall the liability of any selling Holder hereunder be
greater in amount than the dollar amount of the net proceeds received by such
Holder upon the sale of the Registrable Securities giving rise to such
indemnification obligation.

          (c)  Conduct of Indemnification Proceedings. If any Proceeding shall
               --------------------------------------
be brought or asserted against any Person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party promptly shall notify the Person
 -----------------
from whom indemnity is sought (the "Indemnifying Party") in writing, and the
                                    ------------------
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to the Indemnified Party and the payment of all
fees and expenses incurred in connection with defense thereof; provided,
                                                               --------
however, that the failure of any Indemnified Party to give such notice shall not
-------
relieve the Indemnifying Party of its obligations or liabilities pursuant to
this Agreement, except (and only) to the extent that it shall be finally
determined by a court of competent jurisdiction (which determination is not
subject to appeal or further review) that such failure shall have proximately
and materially adversely prejudiced the Indemnifying Party.

                                       11
<PAGE>

          An Indemnified Party shall have the right to employ separate counsel
in any such Proceeding and to participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Party
or Parties unless: (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses; or (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (3) the named
parties to any such Proceeding (including any impleaded parties) include both
such Indemnified Party and the Indemnifying Party, and such Indemnified Party
shall have been advised by counsel that a conflict of interest is likely to
exist if the same counsel were to represent such Indemnified Party and the
Indemnifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and such counsel shall be at the expense of
the Indemnifying Party). The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.

          All fees and expenses of the Indemnified Party (including reasonable
fees and expenses to the extent incurred in connection with investigating or
preparing to defend such Proceeding in a manner not inconsistent with this
Section) shall be paid to the Indemnified Party, as incurred, within ten (10)
Business Days of written notice thereof to the Indemnifying Party (regardless of
whether it is ultimately determined that an Indemnified Party is not entitled to
indemnification hereunder; provided, that the Indemnifying Party may require
such Indemnified Party to undertake to reimburse all such fees and expenses to
the extent it is finally judicially determined that such Indemnified Party is
not entitled to indemnification hereunder).

          (d) Contribution. If a claim for indemnification under Section 5(a) or
5(b) is unavailable to an Indemnified Party because of a failure or refusal of a
court of competent jurisdiction to enforce such indemnification in accordance
with its terms (by reason of public policy or otherwise), then each Indemnifying
Party, in lieu of indemnifying such Indemnified Party, shall contribute to the
amount paid or payable by such Indemnified Party as a result of such Losses, in
such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party and Indemnified Party in connection with the actions,
statements or omissions that resulted in such Losses as well as any other
relevant equitable considerations. The relative fault of such Indemnifying Party
and Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission of a material fact, has been
taken or made by, or relates to information supplied by, such Indemnifying Party
or Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action, statement or
omission. The amount paid or payable by a party as a result of any Losses shall
be deemed to include, subject to the limitations set forth in Section 5(c), any
reasonable attorneys' or other reasonable fees or expenses incurred by such
party in connection

                                       12
<PAGE>

with any Proceeding to the extent such party would have been indemnified for
such fees or expenses if the indemnification provided for in this Section was
available to such party in accordance with its terms. In no event shall any
selling Holder be required to contribute an amount under this Section 5(d) in
excess of the net proceeds received by such Holder upon sale of the Registrable
Securities pursuant to the Registration Statement giving rise to such
contribution obligation.

          The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
No Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.

          The indemnity and contribution agreements contained in this Section
are in addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

     6.   Rule 144
          --------

          During the Effectiveness Period, as long as any Holder owns
Registrable Securities, the Company covenants to timely file (or obtain
extensions in respect thereof and file within the applicable grace period) all
reports required to be filed by the Company after the date hereof pursuant to
Section 13(a) or l5(d) of the Exchange Act. During the Effectiveness Period, as
long as any Holder owns Registrable Securities, if the Company is not required
to file reports pursuant to Section 13(a) or l5(d) of the Exchange Act, it will
prepare and furnish to the Holders and make publicly available in accordance
with Rule 144(c) promulgated under the Securities Act annual and quarterly
financial statements, together with a discussion and analysis of such financial
statements in form and substance substantially similar to those that would
otherwise be required to be included in reports required by Section 13(a) or
15(d) of the Exchange Act, as well as any other information required thereby, in
the time period that such filings would have been required to have been made
under the Exchange Act. The Company further covenants that it will use
commercially reasonable efforts to take such further action as any Holder may
reasonably request, all to the extent required from time to time to enable such
Person to sell Underlying Shares without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144 promulgated under
the Securities Act, including requesting of its counsel to provide any legal
opinions referred to in the Purchase Agreement. Upon the request of any Holder,
the Company shall deliver to such Holder a written certification of a duly
authorized officer as to whether it has complied with such requirements of this
Section 6.

     7.   Miscellaneous
          -------------

          (a) Remedies. In the event of a breach by the Company or by a Holder
              --------
of any of their obligations under this Agreement, each Holder or the Company, as
the case may be, in addition to being entitled to exercise all rights granted by
law and under this Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement. The Company and each
Holder agree that monetary damages would not provide

                                       13
<PAGE>

adequate compensation for any losses incurred by reason of a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate.

          (b)  No Inconsistent Agreements.  Neither the Company nor any of its
               --------------------------
subsidiaries has, as of the date hereof, nor shall the Company or any of its
subsidiaries, on or after the date of this Agreement, enter into any agreement
with respect to its securities that is inconsistent with the rights granted to
the Holder in this Agreement or otherwise conflicts with or limits the
provisions hereof.   Except as disclosed in Schedule 2.1(a) of the Purchase
Agreement, neither the Company nor any of its subsidiaries has previously
entered into any agreement granting any registration rights with respect to any
of its securities to any Person.  This Agreement, together with the Purchase
Agreement and the MTI Registration Rights Agreement, contain the entire
understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, with respect
to such matters.

          (c)  Piggy-Back Registrations. Except as provided herein if, at any
               ------------------------
time when there is not an effective Registration Statement covering the
Registrable Securities, the Company shall determine to prepare and file with the
Commission a registration statement relating to an offering for its own account
or the account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to be
issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with stock option or other employee
benefit plans (and other than a registration statement filed pursuant to Section
2(b) of the Registration Rights Agreement between the Company and Brown Simpson
Capital Management, LLC (and/or its affiliated fund), the Company shall send to
each Holder of Registrable Securities written notice of such determination and,
if within ten (10) days after receipt of such notice, any such Holder shall so
request in writing, (which request shall specify the Registrable Securities
intended to be disposed of by the Purchasers), the Company will use reasonable
efforts to effect the registration under the Securities Act of all Registrable
Securities which the Company has been so requested to register by the Holder, to
the extent requisite to permit the disposition of the Registrable Securities so
to be registered, provided that if at any time after giving written notice of
its intention to register any securities and prior to the effective date of the
registration statement filed in connection with such registration, the Company
shall determine for any reason not to register or to delay registration of such
securities, the Company may, at its election, give written notice of such
determination to such Holder and, thereupon, (i) in the case of a determination
not to register, shall be relieved of its obligation to register any Registrable
Securities in connection with such registration (but not from its obligation to
pay expenses in accordance with Section 4 hereof), and (ii) in the case of a
determination to delay registering, shall be permitted to delay registering any
Registrable Securities being registered pursuant to this Section 7(c) for the
same period as the delay in registering such other securities. The Company shall
include in such registration statement all or any part of such Registrable
Securities such Holder requests to be registered; provided, however, that the
                                                  --------  -------
Company shall not be required to register any Registrable Securities pursuant to
this Section 7(c) that are eligible for sale pursuant to Rule 144(k) of the
Securities Act. In the case of an underwritten public offering,

                                       14
<PAGE>

if the managing underwriter(s) or underwriter(s) should reasonably object to the
inclusion of the Registrable Securities in such registration statement, then if
the Company after consultation with the Underwriter's representative should
reasonably determine that the inclusion of such Registrable Securities would
materially adversely affect the offering contemplated in such registration
statement, and based on such determination recommends inclusion in such
registration statement of fewer Registrable Securities then proposed to be sold
by the Holders, then (x) the number of Registrable Securities of the Holder and
other holders of piggy-back registration rights included in such registration
statement shall be reduced pro rata among such Holders and other holders of
piggy-back registration rights (based upon the number of Registrable Securities
requested to be included in the registration) or, in the case of other holders
of piggy-back registration rights, in the manner provided for in that applicable
agreement, or (y) none of the Registrable Securities of the Holders shall be
included in such registration statement if the Company, after consultation with
the underwriter(s), recommends the inclusion of none of such Registrable
Securities; provided, however, that if securities are being offered for the
            --------  -------
account of other persons or entities as well as the Company, such reduction
shall not represent a greater fraction of the number of Registrable Securities
intended to be offered by the Holders than the fraction of similar reductions
imposed on such other persons or entities (other than the Company).
Notwithstanding the foregoing, the Company shall not file any registration
statement under the Securities Act (other than on Form S-4 or Form S-8) relating
to the offer and sale of any equity securities of the Company, or offer or sell
any equity securities of the Company in a transaction exempt from registration
pursuant to Regulation S under the Securities Act, until such time as the
Initial Registration Statement has been effective for a period of sixty (60)
Trading Days, which period shall be tolled if the effectiveness of the Initial
Registration Statement is suspended for any reason whatsoever.

          (d)  Further Obligations of the Company. Whenever, under the preceding
               ----------------------------------
sections of this Agreement, the Company is required hereunder to register
Registrable Securities pursuant to Section 7(c) above, it agrees that it shall
also do the following:

               (1) Unless and until the distribution of all Registrable
Securities requested to be registered under section 7(c) above is complete,
diligently prepare for filing with the Commission a registration statement and
such amendments and supplements to said registration statement and the
prospectus used in connection therewith as may be necessary to keep said
registration statement effective for a period of at least 120 days and to comply
with the provisions of the Securities Act with respect to the sale of securities
covered by said registration statement for the period necessary to complete the
proposed public offering;

               (2) Furnish to any selling Holder of Registrable Securities such
copies of each preliminary and final prospectus and such other documents as such
Holder may reasonably request to facilitate the public offering of its
Registrable Securities;

               (3) Enter into any underwriting agreement with provisions
reasonably required by the proposed underwriter for the selling Holder of
Registrable Securities, if any, and reasonably acceptable to the Company; and

                                       15
<PAGE>

               (4)  Register or qualify the Registrable Securities covered by
said registration statement under the securities or "blue-sky" laws of such
jurisdictions as the selling Holder of Registrable Securities may reasonably
request.

          (e)  Amendments and Waivers. The provisions of this Agreement,
               ----------------------
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and the Holders of at least two-thirds of the then outstanding Registrable
Securities; provided, however, that for the purposes of this sentence,
            --------  -------
Registrable Securities that are owned, directly or indirectly, by the Company,
or an Affiliate of the Company are not deemed outstanding. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of Holder and that does not
directly or indirectly affect the rights of other Holder may be given by Holders
of at least a majority of the Registrable Securities to which such waiver or
consent relates; provided, however, that the provisions of this sentence may not
                 --------  -------
be amended, modified, or supplemented except in accordance with the provisions
of the immediately preceding sentence.

          (f)  Notices. Any notice or other communication required or permitted
               -------
to be given hereunder shall be in writing and shall be deemed to have been
received (a) upon hand delivery (receipt acknowledged) or delivery by telex
(with correct answer back received), telecopy or facsimile (with transmission
confirmation report) at the address or number designated below (if received by
5:00 p.m. eastern time where such notice is to be received), or the first
Business Day following such delivery (if received after 5:00 p.m. eastern time
where such notice is to be received) or (b) on the second Business Day following
the date of mailing by express courier service, fully prepaid, addressed to such
address, or upon actual receipt of such mailing, whichever shall first occur.
The addresses for such communications are (i) if to the Company to SatCon
Technology Corporation, 161 First Street, Cambridge, MA 02142-1221, Attn:
President and Chief Executive Officer, fax no. (617) 576-7455, with copies to
Hale & Dorr LLP, 60 State Street, Boston, MA 02109, Attn: Jeffrey N. Carp, Esq.,
fax no. (617) 526-5000 and (ii) if to Purchaser to Mechanical Technology
Incorporated, 968 Albany-Shaker Road, Latham, New York 12110. Attention: Chief
Financial Officer with copies to Catherine S. Hill, PLLC, 4 Global View, Troy,
New York 12180 Attn: Catherine S. Hill, Esq., fax no. (518) 285-7564 or such
other address as may be designated in writing hereafter, in the same manner, by
such Person.

          (g)  Successors and Assigns. This Agreement shall inure to the benefit
               ----------------------
of and be binding upon the successors and permitted assigns of each of the
parties and shall inure to the benefit of the Holder. The Company may not assign
its rights or obligations hereunder without the prior written consent of the
Holder. The Holder may assign its rights hereunder in the manner and to the
Persons as permitted under the Purchase Agreement. In addition, the rights of
the Holder hereunder, including the right to have the Company register for
resale Registrable Securities in accordance with the terms of this Agreement,
shall be automatically assignable by the Holder if: (i) the Holder agrees in
writing with the transferee or assignee to assign such rights, and a copy of
such agreement is furnished to the Company within a reasonable time after such
assignment, (ii) the Company is, within a reasonable time after such transfer or
assignment, furnished with written notice of (a) the name and address of such
transferee or assignee, and (b)

                                       16
<PAGE>

the securities with respect to which such registration rights are being
transferred or assigned, (iii) following such transfer or assignment the further
disposition of such securities by the transferee or assignees is restricted
under the Securities Act and applicable state securities laws, (iv) at or before
the time the Company receives the written notice contemplated by clause (ii) of
this Section, the transferee or assignee agrees in writing with the Company to
be bound by all of the provisions of this Agreement, and (v) such transfer shall
have been made in accordance with the applicable requirements of the Purchase
Agreement. The rights to assignment shall apply to the Holders (and to
subsequent) successors and assigns.

          (h) Counterparts. This Agreement may be executed in any number of
              ------------
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same Agreement. In
the event that any signature is delivered by facsimile transmission, such
signature shall create a valid and binding obligation of the party executing (or
on whose behalf such signature is executed) the same with the same force and
effect as if such facsimile signature were the original thereof.

          (i) Governing Law. The corporate laws of the State of Delaware shall
              -------------
govern all issues concerning the relative rights of the Company and the
Purchaser as its stockholders. All other questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed by
and construed in accordance with the laws of the State of New York, without
regard to principles of conflicts of law. Each party hereby irrevocably submits
to the non-exclusive jurisdiction of the federal courts sitting in the City of
Albany, County of Albany or if diversity jurisdiction cannot be obtained, then
in the state courts sitting in the city of Albany, county of Albany, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consent to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law.

          (j) Cumulative Remedies. The remedies provided herein are cumulative
              -------------------
and not exclusive of any remedies provided by law.

          (k) Severability. If any term, provision, covenant or restriction of
              ------------
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

                                       17
<PAGE>

          (l) Headings. The headings in this Agreement are for convenience of
              --------
reference only and shall not limit or otherwise affect the meaning hereof.

          (m) Shares Held by The Company and its Affiliates. Whenever the
              ---------------------------------------------
consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Company or
its Affiliates (other than any Holder or transferees or successors or assigns
thereof if such Holder is deemed to be an Affiliate solely by reason of its
holdings of such Registrable Securities) shall not be counted in determining
whether such consent or approval was given by the Holders of such required
percentage.

          (n) Revision of SEC Position on Warrants. In the event the rules and
              ------------------------------------
regulations of the Commission or the policies of the staff of the Commission are
modified and as a result thereof the Company determines in good faith that it
may be practicable and in the interests of the Company and the Holders to
register the exercise of the Warrants so that the Warrant Shares may be freely
resold without maintaining an effective registration statement under the
Securities Act for resales, the Company and the Holders agree to cooperate in
good faith to effect such amendments to this Agreement as may be appropriate to
provide that the Company may fulfill its obligations hereunder with respect to
the Warrants and the Warrant Shares by maintaining an effective registration
statement under the Securities Act covering the exercise of the Warrants rather
than the resale of the Warrant Shares.


                          [SIGNATURE PAGE TO FOLLOW]

                                       18
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this SatCon Registration
Rights Agreement as of the date first written above.

                                         SATCON TECHNOLOGY CORPORATION


                                         By: /s/ David B. Eisenhaure
                                             --------------------------
                                             Name: David B. Eisenhaure
                                             Title: President

                                         MECHANICAL TECHNOLOGY INCORPORATED

                                         By: /s/ Cynthia A. Scheuer
                                             --------------------------
                                             Name: Cynthia A. Scheuer
                                             Title: Vice President and CFO

                                       19
<PAGE>

                                   EXHIBIT A

                             PLAN OF DISTRIBUTION

          Our company is registering the shares of common stock on behalf of the
selling stockholders. All costs, expenses and fees in connection with the
registration of the shares offered by this prospectus will be borne by the
Company, other than brokerage commissions and similar selling expenses, if any,
attributable to the sale of shares which will be borne by the selling
stockholders. Sales of shares may be effected by selling stockholders from time
to time in one or more types of transactions (which may include block
transactions) on the Nasdaq National Market, in the over-the-counter market, in
negotiated transactions, through put or call options transactions relating to
the shares, through short sales of shares, or a combination of such methods of
sale, at market prices prevailing at the time of sale, or at negotiated prices.
Such transactions may or may not involve brokers or dealers. The selling
stockholders have advised our company that they have not entered into any
agreements, understandings or arrangements with any underwriters or broker-
dealers regarding the sale of their securities, nor is there an underwriter or
coordinated broker acting in connection with the proposed sale of shares by the
selling stockholders.

          The selling stockholders may enter into hedging transactions with
broker-dealers or other financial institutions. In connection with such
transactions, broker-dealers or other financial institutions may engage in short
sales of the shares or of securities convertible into or exchangeable for the
shares in the course of hedging positions they assume with selling stockholders.
The selling stockholders may also enter into options or other transactions with
broker-dealers or other financial institutions which require the delivery to
such broker-dealers or other financial institutions of shares offered by this
prospectus, which shares such broker-dealer or other financial institution may
resell pursuant to this prospectus (as amended or supplemented to reflect such
transaction).

          The selling stockholders may make these transactions by selling shares
directly to purchasers or to or through broker-dealers, which may act as agents
or principals. Such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from selling stockholders and/or the
purchasers of shares for whom such broker-dealers may act as agents or to whom
they sell as principal, or both (which compensation as to a particular broker-
dealer might be in excess of customary commissions).

          The selling stockholders and any broker-dealers that act in connection
with the sale of shares are "underwriters" within the meaning of Section 2(11)
of the Securities Act, and any commissions received by such broker-dealers or
any profit on the resale of the shares sold by them while acting as principals
might be deemed to be underwriting discounts or commissions under the Securities
Act. The selling stockholders may agree to indemnify any agent, dealer or
broker-dealer that participates in transactions involving sales of the shares
against certain liabilities, including liabilities arising under the Securities
Act.

                                       20
<PAGE>

          Because selling stockholders are "underwriters" within the meaning of
Section 2(11) of the Securities Act, the selling stockholders will be subject to
the prospectus delivery requirements of the Securities Act. Our company has
informed the selling stockholders that the anti-manipulative provisions of
Regulation M promulgated under the Exchange Act may apply to their sales in the
market.

          Selling stockholders also may resell all or a portion of the shares in
open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of Rule 144.

          Upon our company being notified by a selling stockholder that any
material arrangement has been entered into with a broker-dealer for the sale of
shares through a block trade, special offering, exchange distribution or
secondary distribution or a purchase by a broker or dealer, a supplement to this
prospectus will be filed, if required, pursuant to Rule 424(b) under the
Securities Act, disclosing:

            the name of each such selling stockholder and of the participating
broker-dealer(s);

            .  the number of shares involved;

            .  the initial price at which such shares were sold;

            .  the commissions paid or discounts or concessions allowed to such
               broker-dealer(s), where applicable;

            .  that such broker-dealer(s) did not conduct any investigation to
               verify the information set out or incorporated by reference in
               this prospectus; and

            .  other facts material to the transactions.

In addition, upon our company being notified by a selling stockholder that a
donee or pledgee intends to sell more than 500 shares, a supplement to this
prospectus will be filed.

                                       21
<PAGE>

                                   EXHIBIT B

                        FORM OF NOTICE OF EFFECTIVENESS
                           OF REGISTRATION STATEMENT


[TRANSFER AGENT]
Attn.:

            Re: SatCon Technology Corporation

Ladies and Gentlemen:

     We are counsel to SatCon Technology Corporation, a Delaware corporation
(the "Company"), and have represented the Company in connection with that
certain Securities Purchase Agreement (the "Purchase Agreement") entered into by
and among the Company and Mechanical Technology Incorporated (the "Holder")
pursuant to which the Company issued to the Holder its shares of the Company's
common stock, par value $0.01 per share (the "Common Stock"), and Warrants (the
"the Warrants") to acquire shares of Common Stock. Pursuant to the Purchase
Agreement, the Company also has entered into a Registration Rights Agreement
with the Holder (the "Registration Rights Agreement") pursuant to which the
Company agreed, among other things, to register the Registrable Securities (as
defined in the Registration Rights Agreement), including the shares of Common
Stock and shares of Common stock issuable upon exercise of the Warrants, under
the Securities Act of 1933, as amended (the "1933 Act"). In connection with the
Company's obligations under the Registration Rights Agreement, on
_______________, 1999, the Company filed a Registration Statement on Form S-3
(File No. 333-_____________) (the "Registration Statement") with the Securities
and Exchange Commission (the "SEC") relating to the Registrable Securities which
names each of the Holders as a selling stockholder thereunder.

     In connection with the foregoing, we advise you that a member of the SEC's
staff has advised us by telephone that the SEC has entered an order declaring
the Registration Statement effective under the 1933 Act at [ENTER TIME OF
EFFECTIVENESS] on [ENTER DATE OF EFFECTIVENESS] and we have no knowledge, after
telephonic inquiry of a member of the SEC's staff, that any stop order
suspending its effectiveness has been issued or that any proceedings for that
purpose are pending before, or threatened by, the SEC and the Registrable
Securities are available for resale under the 1933 Act pursuant to the
Registration Statement.

                                                           Very truly yours,
                                                           [ISSUER'S COUNSEL]

cc: [LIST NAMES OF HOLDERS]

                                       22