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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>UNITED STATES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>Washington,
DC 20549</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>CURRENT
REPORT Pursuant</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>to
Section 13 or 15(</B></FONT><B>d<FONT STYLE="text-transform: uppercase">) of the</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>Securities
Exchange Act of 1934</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&#9;Date
of Report (Date of earliest event reported<B>):</B><U> <B>March 2, 2012</B>&#9;</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; border-bottom: Black 0.75pt solid"><B>ThermoEnergy
Corporation </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Exact name of registrant as specified in its
charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; border-bottom: Black 0.75pt solid"><B>Delaware</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="letter-spacing: -0.15pt">(State
or other jurisdiction</FONT> <FONT STYLE="letter-spacing: -0.15pt">of incorporation)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times">
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0; padding-left: 0; font-weight: bold; border-bottom: Black 1pt solid; text-align: center; width: 50%">33-46104-FW</TD>
    <TD STYLE="padding-right: 0; padding-left: 0; font-weight: bold; border-bottom: Black 1pt solid; text-align: center; width: 50%">71-0659511</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">(Commission File Number)</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">(IRS Employer Identification No.)</TD></TR>
</TABLE>
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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0; padding-left: 0; font-weight: bold; width: 50%; text-align: center; border-bottom: Black 1pt solid">10 New Bond Street, Worcester, Massachusetts</TD>
    <TD STYLE="padding-right: 0; padding-left: 0; font-weight: bold; border-bottom: Black 1pt solid; text-align: center; width: 50%">01606</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0; padding-left: 0; text-align: center">(Address of principal executive offices)</TD>
    <TD STYLE="padding-right: 0; padding-left: 0; text-align: center"><FONT STYLE="letter-spacing: -0.15pt">(Zip Code)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; border-bottom: Black 0.75pt solid"><B>(508)
854-1628</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="letter-spacing: -0.15pt">(</FONT>Registrant&rsquo;s
telephone number, including area code)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.25in"><FONT STYLE="letter-spacing: -0.15pt">Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (<I>see </I>General Instruction A.2. below):</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; letter-spacing: -0.15pt">&#9;</FONT><FONT STYLE="font-family: Wingdings">o</FONT><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9;Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; letter-spacing: -0.15pt">&#9;</FONT><FONT STYLE="font-family: Wingdings">o</FONT><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9;Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; letter-spacing: -0.15pt">&#9;</FONT><FONT STYLE="font-family: Wingdings">o</FONT><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9;Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/13pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif; letter-spacing: -0.15pt">&#9;</FONT><FONT STYLE="font-family: Wingdings">o</FONT><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9;Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="letter-spacing: -0.15pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 12pt 0"><B>Item 1.02.&#9;Termination of a Material Definitive Agreement</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On March 2, 2012, we, our subsidiary, ThermoEnergy
Power Systems, LLC (&ldquo;TEPS&rdquo;), Babcock Power, Inc. (&ldquo;Babcock&rdquo;),&nbsp;and Babcock Power Development, LLC (&ldquo;BPD&rdquo;),
a subsidiary of Babcock,&nbsp;entered into a Dissolution Agreement (the &ldquo;Dissolution Agreement&rdquo;) for the purpose of
terminating the Limited Liability Company Agreement dated as of February 25, 2009 (as amended on April 12, 2011, the &ldquo;LLC
Agreement&rdquo;) of Babcock-Thermo Clean Combustion LLC (&ldquo;BTCC&rdquo;) and dissolving BTCC, the joint venture which we and
Babcock had organized for the purpose of developing and commercializing our proprietary pressurized oxy-fuel combustion technology.
The dissolution of BTCC and the liquidation and distribution of BTCC&rsquo;s assets will be effected by BTCC&rsquo;s Board of Managers
(consisting of three managers designated by us and three designated by Babcock), which will remain in place until the dissolution
is complete.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Pursuant to the LLC Agreement, and as confirmed
by the Dissolution Agreement, the exclusive license of our pressurized oxy-fuel combustion technology to BTCC has been terminated
and we are now free to exploit the technology independent of Babcock. Our pressurized oxy-fuel combustion technology converts
fossil fuels (including coal, oil and natural gas) and biomass into electricity with near zero air emissions while removing and
capturing carbon dioxide in liquid form for sequestration or beneficial reuse.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The parties remain bound by the Master Non-Disclosure
Agreement (the &ldquo;Master Non-Disclosure Agreement&rdquo;) entered into in connection with the organization of BTCC, which imposes
on all parties continuing confidentiality obligations. Babcock and BPD have agreed to return to us, upon request, all TEPS Confidential
Information (as such term is defined in the Master Non-Disclosure Agreement) and we and TEPS have agreed to return to Babcock,
upon request, all Babcock Confidential Information (as such term is defined in the Master Non-Disclosure Agreement).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Dissolution Agreement includes mutual releases
of claims and provides that each party shall bear its own fees and expenses incurred in connection with the transactions contemplated
by the Dissolution Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 3pt">The Dissolution Agreement is filed as Exhibit 10.1 to this
Current Report on Form 8-K and the foregoing description of the Dissolution Agreement is qualified in its entirety by reference
to such Exhibit.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 3pt">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 13%; font-weight: bold"><B>Item 9.01</B></TD>
    <TD STYLE="width: 87%; color: #000033; font-weight: bold">&nbsp;Financial Statements and Exhibits</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 4%">(c)</TD>
    <TD>Exhibits </TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-family: Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 14%; border: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt; font-weight: bold; text-align: center">Exhibit No.</TD>
    <TD STYLE="width: 86%; border: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; font-size: 10pt; font-weight: bold; text-align: center">Description</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border: windowtext 1pt solid; padding-top: 6pt; padding-bottom: 6pt; font-size: 10pt; text-align: center">10.1</TD>
    <TD STYLE="border-right: windowtext 1pt solid; border-bottom: windowtext 1pt solid; padding-top: 6pt; padding-bottom: 6pt; font-size: 10pt">Dissolution Agreement effective as of March 2, 2012, by and among Babcock-Thermo Clean Combustion LLC, Babcock Power Development, LLC, Babcock Power Inc., ThermoEnergy Power Systems, LLC, and ThermoEnergy Corporation.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Date: March 8, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 3.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 4in; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>



<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2"><U>THERMOENERGY CORPORATION</U></TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Registrant)</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; width: 50%">&nbsp;</TD>
    <TD STYLE="width: 5%">By:&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 45%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;/s/ Teodor Klowan, Jr.&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD>Name:&nbsp;</TD>
    <TD STYLE="vertical-align: top; border-top: #000000 1px solid">Teodor Klowan, Jr. CPA</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD>Title:&nbsp;</TD>
    <TD STYLE="vertical-align: top">Chief Financial Officer&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: 0pt; margin-top: 0pt; margin-bottom: 6pt">&nbsp;</P>

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<BR>
<BR>
<BR>
<BR>


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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
DC 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
):
March 2, 2012
ThermoEnergy
Corporation
(Exact name of registrant as specified in its
charter)
Delaware
(State
or other jurisdiction
of incorporation)
33-46104-FW
71-0659511
(Commission File Number)
(IRS Employer Identification No.)
10 New Bond Street, Worcester, Massachusetts
01606
(Address of principal executive offices)
(Zip Code)
(508)
854-1628
(
Registrant's
telephone number, including area code)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (
see
General Instruction A.2. below):
o
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.02.	Termination of a Material Definitive Agreement
On March 2, 2012, we, our subsidiary, ThermoEnergy
Power Systems, LLC ("TEPS"), Babcock Power, Inc. ("Babcock"), and Babcock Power Development, LLC ("BPD"),
a subsidiary of Babcock, entered into a Dissolution Agreement (the "Dissolution Agreement") for the purpose of
terminating the Limited Liability Company Agreement dated as of February 25, 2009 (as amended on April 12, 2011, the "LLC
Agreement") of Babcock-Thermo Clean Combustion LLC ("BTCC") and dissolving BTCC, the joint venture which we and
Babcock had organized for the purpose of developing and commercializing our proprietary pressurized oxy-fuel combustion technology.
The dissolution of BTCC and the liquidation and distribution of BTCC's assets will be effected by BTCC's Board of Managers
(consisting of three managers designated by us and three designated by Babcock), which will remain in place until the dissolution
is complete.
Pursuant to the LLC Agreement, and as confirmed
by the Dissolution Agreement, the exclusive license of our pressurized oxy-fuel combustion technology to BTCC has been terminated
and we are now free to exploit the technology independent of Babcock. Our pressurized oxy-fuel combustion technology converts
fossil fuels (including coal, oil and natural gas) and biomass into electricity with near zero air emissions while removing and
capturing carbon dioxide in liquid form for sequestration or beneficial reuse.
The parties remain bound by the Master Non-Disclosure
Agreement (the "Master Non-Disclosure Agreement") entered into in connection with the organization of BTCC, which imposes
on all parties continuing confidentiality obligations. Babcock and BPD have agreed to return to us, upon request, all TEPS Confidential
Information (as such term is defined in the Master Non-Disclosure Agreement) and we and TEPS have agreed to return to Babcock,
upon request, all Babcock Confidential Information (as such term is defined in the Master Non-Disclosure Agreement).
The Dissolution Agreement includes mutual releases
of claims and provides that each party shall bear its own fees and expenses incurred in connection with the transactions contemplated
by the Dissolution Agreement.
The Dissolution Agreement is filed as Exhibit 10.1 to this
Current Report on Form 8-K and the foregoing description of the Dissolution Agreement is qualified in its entirety by reference
to such Exhibit.
Item 9.01
Financial Statements and Exhibits
(c)
Exhibits
Exhibit No.
Description
10.1
Dissolution Agreement effective as of March 2, 2012, by and among Babcock-Thermo Clean Combustion LLC, Babcock Power Development, LLC, Babcock Power Inc., ThermoEnergy Power Systems, LLC, and ThermoEnergy Corporation.
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.
Date: March 8, 2012
THERMOENERGY CORPORATION
(Registrant)
By:
/s/ Teodor Klowan, Jr.
Name:
Teodor Klowan, Jr. CPA
Title:
Chief Financial Officer