Catalytica Energy Systems Announces Settlement of Acquisition-Related Payments With Previous Owners of SCR-Tech
4 March 2006
Catalytica Energy Systems, Inc. (NASDAQ: CESI),
today announced that it has reached a settlement agreement with EnBW Energy
Solutions GmbH, ENVICA Kat GmbH, ENVICA GmbH, E&EC Energy & Environmental
Consultants GmbH, SCR-Tech GmbH, Hans-Ulrich Hartenstein and Brigitte
Hartenstein (collectively "the sellers" or "the parties"), and entered into
a mutual release and termination of all outstanding and future obligations
or claims associated with the Company's acquisition of SCR-Tech in February
2004.
As part of the settlement agreement and mutual release, Catalytica Energy
Systems made a one-time cash payment of $1.5 million to the sellers in the
fourth quarter of 2005. This cash settlement resolves outstanding payments
and extinguishes all future obligations under the original purchase
agreement signed in February 2004. Accordingly, Catalytica Energy Systems
expects to record a one-time gain for settlement of debt in the fourth
quarter of 2005 of approximately $2.1 million, reflecting the net present
value of previously estimated probable future payments recorded on the
Company's financial statements.
Rob Zack, president and CEO of Catalytica Energy Systems, stated, "Settling
this matter has favorably resolved any uncertainties with respect to the
amount of future payments under the original purchase agreement. We are
pleased to have finalized all of our payment obligations associated with
our acquisition of SCR-Tech so we can fully focus our energies and
resources on growing the business."
SCR-Tech President Bill McMahon, commented, "Equally as important to us as
resolving our obligations under the original purchase agreement is our
ongoing technical alliance with ENVICA and continued collaboration with
EnBW. We are pleased to have brought this matter to a favorable resolution
for the parties involved and look forward to an ongoing productive and
cooperative working relationship with both companies going forward."
Werner Goetz, managing director of EnBW Energy Solutions GmbH, said, "We
are happy to conclude the final payments from Catalytica Energy Systems for
the purchase of SCR-Tech. We look forward to continued collaboration with
SCR-Tech to further penetrate the in-situ SCR catalyst cleaning market in
Europe using the proprietary technology that has been transferred to
SCR-Tech."
Frank Ebinger, president of ENVICA Kat GmbH, added, "The finalization of
the payments between Catalytica Energy Systems and the sellers of SCR-Tech
is a welcome event for all parties. SCR-Tech and ENVICA will continue to
benefit from an ongoing technical and process exchange between companies
and plan to continue working closely together to develop technology
advances and enhancements to our value-added service offerings."
In consideration for Catalytica Energy Systems' payment of $1.5 million to
the sellers, the parties to the Settlement Agreement agreed to terminate
all obligations under the Membership Interests and Asset Purchase Agreement
entered into in connection with the acquisition of SCR-Tech by Catalytica
Energy Systems and the acquisition of certain intellectual property by
Catalytica Energy Systems (the "MIAPA") and waive all claims in connection
with the MIAPA and the employment agreements between Hans-Ulrich
Hartenstein and SCR-Tech and Brigitte Hartenstein and SCR-Tech. Further,
as part of the
Settlement Agreement, the following agreements were reached: 1) EnBW and
ENVICA each entered into confidentiality agreements with Catalytica Energy
Systems to continue to preserve important proprietary information; 2)
Catalytica Energy Systems and ENVICA entered into a Territorial Restriction
Agreement providing exclusive rights to Catalytica Energy Systems within
NAFTA and exclusive rights to ENVICA outside of NAFTA with respect to the
use of technology for SCR cleaning, rejuvenation and regeneration services;
and 3) Hans and Brigitte Hartenstein entered into a Confidentiality and
Invention Assignment Agreement with SCR-Tech confirming the continuation of
confidentiality obligations and assignment of intellectual property.
About Catalytica Energy Systems
Catalytica Energy Systems provides innovative products and services to meet
the rapidly growing demand for emissions control solutions in the power
generation and transportation industries. Through its SCR-Tech subsidiary
(www.SCR-Tech.com), the Company offers a variety of services for coal-fired
power plants using selective catalytic reduction (SCR) systems to reduce
nitrogen oxides (NOx) emissions. These services include SCR catalyst
management, cleaning and regeneration, as well as consulting services to
help power plant operators optimize efficiency and reduce overall NOx
compliance costs. Catalytica Energy Systems' other business activities
include the design, development and manufacture of advanced products based
on its proprietary catalyst and fuel processing technologies to offer
cost-effective solutions for reducing NOx emissions from diesel engines and
natural gas-fired turbines. The Company's Xonon® Diesel Fuel Processing
technology is designed to facilitate significant NOx reduction from mobile,
stationary, and off-road diesel engines by improving the performance of NOx
adsorber catalyst systems. Catalytica Energy Systems' commercially
available Xonon Cool Combustion® system offers a breakthrough pollution
prevention approach for gas turbines to achieve ultra-low emissions power
generation through a proprietary catalytic combustion process. Find
Catalytica Energy Systems on the Worldwide Web at www.CatalyticaEnergy.com.
This news release contains
forward-looking statements within the meaning of the Securities Exchange
Act of 1934, as amended, and subject to the safe harbors created therein.
These statements include, but are not limited to, those regarding
Catalytica Energy Systems' expectations relating to the amount and timing
of the recording of gain from the settlement of debt; the Company's ability
to maintain a productive and cooperative future working relationship with
ENVICA and EnBW; and its prospects for mutual development of technology
advances and enhancements to its service offerings. These statements are
subject to risks and uncertainties that could cause actual results and
events to differ materially from those expressed in the forward-looking
statements. These risks and uncertainties include, among others; the risks
associated with the development, generally, of the Company's overall
strategic objectives and the other risks set forth in the Company's most
recently filed Forms 10-K and 10-Q filed with the Securities and Exchange
Commission. The Company undertakes no obligation to update any
forward-looking statements to reflect new information, events, or
circumstances occurring after the date of this release.
Editor's Note: Xonon and Xonon Cool Combustion are trademarks or
registered trademarks of Catalytica Energy Systems, Inc., Gilbert, AZ, USA.
CONTACT:
Megan Meloni
Investor Relations
(650) 940-6253
SOURCE: Catalytica Energy Systems, Inc.
Source: marketwire
All trademarks and copyrighted information contained herein are the property of their respective owners.
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