Covol Technologies Inc. Receives Teco Performance Payments.Business Editors LEHI, Utah--(BUSINESS WIRE)--May 23, 2000 Covol Technologies Inc. (Nasdaq:CVOL CVOL Control Volume ), Tuesday announced that two Premier Elkhorn Coal Co. synthetic fuel Synthetic fuel or synfuel is any liquid fuel obtained from coal, natural gas, or biomass. It can sometimes refer to fuels derived from other solids such as oil shale, tar sand, waste plastics, or from the fermentation of biomatter. facilities sold earlier this year have now been relocated and have reached commercial operations. Covol received net payments of $6.5 million. The plants, referred to as the Pocahontas and Mohave Synfuel syn·fu·el n. A liquid or gaseous fuel derived from coal, shale, or tar sand, or obtained by fermentation of certain substances, such as grain. [syn(thetic) + fuel.] facilities, were both sold in January of 2000. In the original sales agreement Covol received a cash payment from both facilities at the time of closing, with these additional milestone payments due to the company after the plants were relocated and reached specified commercial operational levels. Covol intends to apply approximately $5 million of the proceeds to further reduce its obligations to the OZ Master Fund, Ltd. This payment will reduce Covol's total obligation from $15 million to approximately $9.6 million. The payment is consistent with the company's intention to repay OZ Master Fund, Ltd. earlier than the contractual due date of Sept. 17, 2001. The board of directors of Covol approved a stock repurchase plan stock repurchase plan 1. See buyback. 2. See self-tender. that authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: the company to purchase from time to time in the open market or negotiated transactions up to an aggregate of (a) 20 percent of the outstanding common stock or (b) 3 million shares of common stock or (c) common stock which can be purchased for $10 million, whichever is the greater. The timing and terms of the purchases is to be determined by appropriate officers of Covol based on market conditions, available cash and the approval of OZ Master Fund, Ltd. until that debt is repaid in full. Any shares repurchased are to be held as treasury stock and shall be available to Covol for general corporate purposes. Kirk A. Benson, chairman and chief executive officer, stated, "We are pleased that the facilities have reached this stage of commercial operations. The relocation of our facilities is an important next step to continue the increase in our revenues. The payment to OZ represents another step in our commitment of early prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. of the OZ debt." 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 forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. 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, including the ability to negotiate settlements of contract terminations Defense procurement: the cessation or cancellation, in whole or in part, of work under a prime contract or a subcontract thereunder for the convenience of, or at the option of, the government, or due to failure of the contractor to perform in accordance with the terms of the contract (default). caused by facility relocations, ability to obtain necessary capital or financing, ability to comply with covenants in financing agreements Financing Agreements In the context of project financing, the documents which provide the project financing and sponsor support for the project as defined in the project contracts. , including financial performance criteria, ability to conserve capital through cost reductions until operating revenues operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. 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 An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. 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. |
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