UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
March 15, 2000
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Date of Report (Date of earliest event reported)
COVOL TECHNOLOGIES, INC.
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(Exact name of Registrant as specified in its charter)
Delaware 0-27808 87-0547337
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(State or other jurisdiction of (Commission File Number) (IRS Employer
incorporation) Identification No.)
3280 N. Frontage Road
Lehi, UT 84043
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(Address of principal executive offices)
(Zip Code)
(801) 768-4481
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report.)
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Item 5. Other Events - Announcement of Sale of Common Stock
Covol announced on March 15, 2000 that it sold approximately 3.6 million shares
of common stock. The complete text of the announcement follows.
Covol Technologies, Inc. today announced that it entered into a binding
subscription agreement for the sale of approximately 3.6 million shares of
common stock at $l.36 per share, for an aggregate consideration of $5,000,000.
The shares have not been registered under the Securities Act of 1933 and may not
be offered or sold in the United States absent registration or an applicable
exemption from registration requirements. The subscription agreement does
however contain registration rights. The Company is still reviewing its options,
but is likely to use the proceeds to redeem its Series D preferred stock, held
by Oz Master Fund, Ltd. The Series D preferred stock is convertible into common
shares of the Company at a conversion price that is equal to 90% of the three
lowest closing bid prices per share in the prior twenty day trading period.
Because of the variable conversion price, the Series D preferred stock is
dilutive if the Company's stock price declines. As of March 14, 2000, the Series
D preferred stock is convertible into approximately 3.2 million shares.
Steven Stewart, Chief Financial Officer, said, "We appreciate the relationship
that we have developed with OZ. They provided the Company with financing when
additional funding was critical to the Company. The financing was costly, and we
are pleased that we now have the ability to redeem the remaining preferred
stock, thus eliminating further potential dilution and market overhang, while
providing OZ with an attractive return."
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 the Company-owned
synthetic fuel facility on favorable terms, including the ability to negotiate
settlements of contract terminations caused by facility relocations, 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 Covol to collect royalties and other payments
from licensees, 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.
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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.
COVOL TECHNOLOGIES, INC.
Registrant
Date: March 22, 2000 /s/ Kirk A. Benson
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Kirk A. Benson
Chief Executive Officer and
Principal Executive Officer
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