Covol Technologies Inc. Announces Corporate Restructuring and Reorganization.

LEHI, Utah--(BUSINESS WIRE)--Aug. 17, 1999--

Covol Technologies Inc. (Nasdaq:CVOL), Tuesday announced a restructuring of the company.

In anticipation of the potential sale of its company owned synthetic fuel facilities, Covol is refocusing its efforts on providing services to its licensees and its non-Section 29 business. The announced restructuring realigns responsibilities for services to be provided to licensees and further development of the company's non-Section 29 business strategy.

The company's focus on the preparation of its synthetic facilities for sale will also allow the company to reduce operating costs associated with the facilities.

As part of the restructuring, Covol is eliminating 11 corporate positions and one facility position. The reduction constitutes a 30 percent reduction in the company's corporate positions.

Although the reduction in staffing is significant, the company believes that the reduction will not negatively impact its ability to provide high quality services to its licensees and its ability to develop the non-Section 29 business strategy.

The combination of preparing the company's owned facilities for sale and the reduction in force should result in an estimated cost savings to the company of $4 to $5 million annually. This restructuring plan is an important element in Covol's strategy to achieve break-even position as soon as possible.

Kirk A. Benson, chief executive officer and chairman of the board, stated, "The first priority for Covol is the sale of its company owned synthetic fuel facilities in a manner that will increase shareholder value.

"Naturally, it is important that Covol preserve its capital and reduce operating expenses prior to the sale of its facilities. The company must achieve a break-even position while it begins to address longer range issues."

Covol is a technology licensing company which engineers industrial waste and other by-products into value-added fuels and resources.

Statements in this news release that relate to future plans, possible transactions, or projected valuations are forward-looking statements within the meaning of Section 27A of the securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including any statement with respect to anticipated products to be produced using Covol's technology and Covol's strategy.

Such statements are subject to risks and uncertainties that could cause actual results to differ materially. Although Covol believes that its expectations are based on reasonable assumptions, there are a number of business factors which singularly or combined may affect the company's future operating results.

In addition to matters affecting Covol's industry or the coal industry or the economy generally, factors which could cause actual results to differ from expectations set forth in the above identified forward-looking statements include but are not limited to the ability to successfully negotiate terms and consummate proposed transactions, ability to sell company owned synthetic fuel facilities on favorable terms, ability to obtain necessary capital or financing, ability to comply with covenants in financing agreements, including financial performance criteria, ability to conserve capital through cost reductions until operating revenues exceed expenses, ability of licensees to market synthetic fuel produced, generating royalties for Covol, ability of licensees to achieve expected production levels at the synthetic fuel facilities, favorable IRS tax treatment, availability of natural resources and suitable raw materials, ability to locate appropriate sites for facilities, ability of Covol to complete specific research and development projects, and the commercial viability of Covol's technologies.