PROMISSORY NOTE


Borrower:   HEADWATERS INCORPORATED
            11778 ELECTION DRIVE, SUITE 210
            SALT LAKE CITY, UT  84020

Lender:     ZIONS FIRST NATIONAL BANK
            HEAD OFFICE/COMMERCIAL BANKING
            2460 SOUTH 3270 WEST
            WEST VALLEY CITY, UT  84119

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                              Initial Rate:10.50%

Principal Amount:$8,000,000.00                     Date of Note:October 18, 2000

PROMISE TO PAY. HEADWATERS INCORPORATED ("Borrower") promises to pay to ZIONS
FIRST NATIONAL BANK ("Lender"), or order, in lawful money of the United States
of America, the principal amount of Six Million & 00/100 Dollars ($6,000,000.00)
or so much as may be outstanding, together with interest on the unpaid
outstanding principal balance of each advance. Interest shall be calculated from
the date of each advance until repayment of each advance.

PAYMENT. Borrower will pay in one payment of all outstanding principal plus all
accrued unpaid interest on January 31, 2002. In addition, Borrower will pay
regular monthly payments of accrued unpaid interest beginning December 1, 2000,
and all subsequent interest payments are due on the same day of each month after
that. The annual interest rate for this Note is computed on a 365/360 basis;
that is, by applying the ratio of the annual interest rate over a year of 360
days, multiplied by the outstanding principal balance, multiplied by the actual
number of days the principal balance is outstanding. Borrower will pay Lender at
Lender's address shown above or at such other place as Lender may designate in
writing. Unless otherwise agreed or required by applicable law, payments will be
applied first to any unpaid collection costs and any late charges, then to any
unpaid interest, and any remaining amount to principal.

VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an index which is the ZIONS FIRST NATIONAL BANK
PRIME RATE (the "Index"). "PRIME RATE" MEANS AN INDEX WHICH IS DETERMINED DAILY
BY THE PUBLISHED COMMERCIAL LOAN VARIABLE RATE INDEX HELD BY ANY TWO OF THE
FOLLOWING BANKS: CHASE MANHATTAN BANK, WELLS FARGO BANK N.A., AND BANK OF
AMERICA, N.A. IN THE EVENT NO TWO OF THE ABOVE BANKS HAVE THE SAME PUBLISHED
RATE, THE BANK HAVING THE MEDIAN RATE WILL ESTABLISH LENDERS' PRIME RATE. IF,
FOR ANY REASON BEYOND THE CONTROL OF LENDER, ANY OF THE AFOREMENTIONED BANKS
BECOMES UNACCEPTABLE AS A REFERENCE FOR THE PURPOSE OF DETERMINING THE PRIME
RATE USED HEREIN, LENDER MAY, FIVE DAYS AFTER POSTING NOTICE IN LENDERS OFFICES,
SUBSTITUTE ANOTHER COMPARABLE BANK FOR THE ONE DETERMINED UNACCEPTABLE. AS USED
IN THIS PARAGRAPH, "COMPARABLE BANK" SHALL MEAN ONE OF THE TEN LARGEST
COMMERCIAL BANKS HEADQUARTERED IN THE UNITED STATES OF AMERICA. THIS DEFINITION
OF PRIME RATE IS TO BE STRICTLY INTERPRETED AND IS NOT INTENDED TO SERVE ANY
PURPOSE OTHER THAN PROVIDING AN INDEX TO DETERMINE THE VARIABLE INTEREST RATE
USED HEREIN. IT IS NOT THE LOWEST RATE AT WHICH LENDER MAY MAKE LOANS TO ANY OF
ITS CUSTOMERS, EITHER NOW OR IN THE FUTURE.. Lender will tell Borrower the
current Index rate upon Borrower's request. Borrower understands that Lender may
make loans based on other rates as well. The interest rate change will not occur
more often than each DAY. The Index currently is 9.500% per annum. The interest
rate to be applied to the unpaid principal balance of this Note will be at a
rate of 1.00 percentage points over the Index, resulting in an initial rate of
10.50% per annum. NOTICE: Under no circumstances will the interest rate on this
Note be more than the maximum rate allowed by applicable law.

PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges
are earned fully as of the date of the loan and will not be subject to refund
upon early payment (whether voluntary or as a result of default), except as
otherwise required by law. Except for the foregoing, Borrower may pay without
penalty all or a portion of the amount owed earlier than it is due. Early
payments will not, unless agreed to by Lender in writing, relieve Borrower of
Borrower's obligation to continue to make payments of accrued unpaid interest.
Rather, they will reduce the principal balance due.

DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender. (c) Any representation or statement made or furnished to Lender
by Borrower or on Borrower's behalf is false or misleading in any material
respect either now or at the time made or furnished. (d) Borrower becomes
insolvent, a receiver is appointed for any part of Borrower's property, Borrower
makes an assignment for the benefit of creditors, or any proceeding is commenced
either by Borrower or against Borrower under any bankruptcy or insolvency laws.
(e) Any creditor tries to take any of Borrower's property on or in which Lender
has a lien or security interest. This includes a garnishment of any of
Borrower's accounts with Lender. (f) Any guarantor dies or any of the other
events described in this default section occurs with respect to any guarantor of
this Note. (g) A material adverse change occurs in Borrower's financial
condition, or Lender believes the prospect of payment or performance of the
Indebtedness is impaired. (h) Lender in good faith deems itself insecure. If any
default, other than a default in payment, is curable, it may be cured (and no
event of default will have occurred) if Borrower, after receiving written notice
from Lender demanding cure of such default: (a) cures the default within thirty
(30) days; or (b) if the cure requires more than thirty (30) days, immediately
initiates steps which Lender deems in Lender's sole discretion to be sufficient
to cure the default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonably
practical.

LENDER'S RIGHTS. Upon default which remains uncured, Lender may declare the
entire unpaid principal balance on this Note and all accrued unpaid interest
immediately due, without notice, and then Borrower will pay that amount. Upon
default, including failure to pay upon final maturity, Lender, at its option,
may also, if permitted under applicable law, increase the variable interest rate
on this Note to 4.750 percentage points over the Index. The interest rate will
not exceed the maximum rate permitted by applicable law. Lender may hire or pay
someone else to help collect this Note if Borrower does not pay. Borrower also
will pay Lender that amount. This includes, subject to any limits under
applicable law, Lender's reasonable attorneys' fees and Lender's legal expenses
whether or not there is a lawsuit, including reasonable attorneys' fees and
legal expenses for bankruptcy proceedings (including efforts to modify or vacate
any automatic stay or injunction), appeals, and any anticipated post-judgment
collection services. If not prohibited by applicable law, Borrower also will pay
any court costs, in addition to all other sums provided by law. This Note has
been delivered to Lender and accepted by Lender in the State of Utah.

If there is a lawsuit, Borrower agrees upon Lender's request to submit to the
jurisdiction of the courts of SALT LAKE County, the State of Utah. Subject to
the provisions on arbitration, this Note shall be governed by and construed in
accordance with the laws of the State of Utah.

RIGHT OF SETOFF. Borrower grants to Lender a contractual security interest in,
and upon an event of default assigns, conveys, delivers, pledges, and transfers
to Lender all Borrower's right, title and interest in and to, Borrower's
accounts with Lender (whether checking, savings, or some other account),
including without limitation all accounts held jointly with someone else and all
accounts Borrower may

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open in the future, excluding however all IRA and Keogh accounts, and all trust
accounts for which the grant of a security interest would be prohibited by law.
Borrower authorizes Lender, to the extent permitted by applicable law, to charge
or setoff all sums owing on this Note against any and all such accounts.

LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under
this Note may be requested orally by Borrower or by an authorized person. Lender
may, but need not, require that all oral requests be confirmed in writing. All
communications, instructions, or directions by telephone or otherwise to Lender
are to be directed to Lender's office shown above. The following party or
parties are authorized to request advances under the line of credit until Lender
receives from Borrower at Lender's address shown above written notice of
revocation of their authority: KIRK A. BENSON, CHAIRMAN & CEO. Borrower agrees
to be liable for all sums either: (a) advanced in accordance with the
instructions of an authorized person or (b) credited to any of Borrower's
accounts with Lender. The unpaid principal balance owing on this Note at any
time may be evidenced by endorsements on this Note or by Lender's internal
records, including daily computer print-outs. Lender will have no obligation to
advance funds under this Note if: (a) Borrower or any guarantor is in default
under the terms of this Note or any agreement that Borrower or any guarantor has
with Lender, including any agreement made in connection with the signing of this
Note; (b) Borrower or any guarantor ceases doing business or is insolvent; (c)
any guarantor seeks, claims or otherwise attempts to limit, modify or revoke
such guarantor's guarantee of this Note or any other loan with Lender; (d)
Borrower has applied funds provided pursuant to this Note for purposes other
than those authorized by Lender; or (e) Lender in good faith deems itself
insecure under this Note or any other agreement between Lender and Borrower.

ARBITRATION DISCLOSURES:

         1.       ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO
                  ONLY VERY LIMITED REVIEW BY A COURT.

         2.       IN ARBITRATION THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE
                  IN COURT, INCLUDING THEIR RIGHT TO A JURY TRIAL.

         3.       DISCOVERY IN ARBITRATION IS MORE LIMITED THAN DISCOVERY IN
                  COURT.

         4.       ARBITRATORS ARE NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR
                  LEGAL REASONING IN THEIR AWARDS. THE RIGHT TO APPEAL OR TO
                  SEEK MODIFICATION OF ARBITRATORS' RULINGS IS VERY LIMITED.

         5.       A PANEL OF ARBITRATORS MIGHT INCLUDE AN ARBITRATOR WHO IS OR
                  WAS AFFILIATED WITH THE BANKING INDUSTRY.

         6.       IF YOU HAVE QUESTIONS ABOUT ARBITRATION, CONSULT YOUR ATTORNEY
                  OR THE AMERICAN ARBITRATION ASSOCIATION.

         (a) Any claim or controversy ("Dispute") between or among the parties
         and their assigns, including but not limited to Disputes arising out of
         or relating to this agreement, this arbitration provision ("arbitration
         clause"), or any related agreements or instruments relating hereto or
         delivered in connection herewith ("Related Documents"), and including
         but not limited to a Dispute based on or arising from an alleged tort,
         shall at the request of any party be resolved by binding arbitration in
         accordance with the applicable arbitration rules of the American
         Arbitration Association (the "Administrator"). The provisions of this
         arbitration clause shall survive any termination, amendment, or
         expiration of this agreement or Related Documents. The provisions of
         this arbitration clause shall supersede any prior arbitration agreement
         between or among the parties. If any provision of this arbitration
         clause should be determined to be unenforceable, all other provisions
         of this arbitration clause shall remain in full force and effect.

         (b) The arbitration proceedings shall be conducted in Salt Lake City,
         Utah, at a place to be determined by the Administrator. The
         Administrator and the arbitrator(s) shall have the authority to the
         extent practicable to take any action to require the arbitration
         proceeding to be completed and the arbitrator(s)' award issued within
         one hundred fifty (150) days of the filing of the Dispute with the
         Administrator. The arbitrator(s) shall have the authority to impose
         sanctions on any party that fails to comply with time periods imposed
         by the Administrator or the arbitrator(s), including the sanction of
         summarily dismissing any Dispute or defense with prejudice. The
         arbitrator(s) shall have the authority to resolve any Dispute regarding
         the terms of this agreement, this arbitration clause or Related
         Documents, including any claim or controversy regarding the
         arbitrability of any Dispute. All limitations periods applicable to any
         Dispute or defense, whether by statute or agreement, shall apply to any
         arbitration proceeding hereunder and the arbitrator(s) shall have the
         authority to decide whether any Dispute or defense is barred by a
         limitations period and, if so, to summarily enter an award dismissing
         any Dispute or defense on that basis. The doctrines of compulsory
         counterclaim, res judicata, and collateral estoppel shall apply to any
         arbitration proceeding hereunder so that a party must state as a
         counterclaim in the arbitration proceeding any claim or controversy
         which arises out of the transaction or occurrence that is the subject
         matter of the Dispute. The arbitrator(s) may in the arbitrator(s)'
         discretion and at the request of any party: (1) consolidate in a single
         arbitration proceeding any other claim or controversy involving another
         party that is substantially related to the Dispute where that other
         party is bound by an arbitration clause with the Lender, such as
         borrowers, guarantors, sureties, and owners of collateral; (2)
         consolidate in a single arbitration proceeding any other claim or
         controversy that is substantially similar to the Dispute; and (3)
         administer multiple arbitration claims or controversies as class
         actions in accordance with the provisions of Rule 23 of the Federal
         Rules of Civil Procedure.

         (c) The arbitrator(s) shall be selected in accordance with the rules of
         the Administrator from panels maintained by the Administrator. A single
         arbitrator shall have expertise in the subject matter of the Dispute.
         Where three arbitrators conduct an arbitration proceeding, the Dispute
         shall be decided by a majority vote of the three arbitrators, at least
         one of whom must have expertise in the subject matter of the Dispute
         and at least one of whom must be a practicing attorney. The
         arbitrator(s) shall award to the prevailing party recovery of all costs
         and fees (including attorneys' fees and costs, arbitration
         administration fees and costs, and arbitrator(s)' fees). The
         arbitrator(s), either during the pendency of the arbitration proceeding
         or as part of the arbitration award, also may grant provisional or
         ancillary remedies, including but not limited to an award of injunctive
         relief, foreclosure, sequestration, attachment, replevin, garnishment,
         or the appointment of a receiver.

         (d) Judgment upon an arbitration award may be entered in any court
         having jurisdiction, subject to the following limitation: the
         arbitration award is binding upon the parties only if the amount does
         not exceed Four Million Dollars ($4,000,000.00); if the award exceeds
         that limit, either party may demand the right to a court trial. Such a
         demand must be filed with the Administrator within thirty (30) days
         following the date of the arbitration award; if such a demand is not
         made within that time period, the amount of the arbitration award shall
         be binding. The computation of the total amount of an arbitration award
         shall include amounts awarded for attorneys' fees and costs,
         arbitration administration fees and costs, and arbitrator(s)' fees.

         (e) No provision of this arbitration clause, nor the exercise of any
         rights hereunder, shall limit the right of any party to: (1) judicially
         or non-judicially foreclose against any real or personal property
         collateral or other security; (2) exercise self-help remedies,
         including but not limited to repossession and setoff rights; or (3)
         obtain from a court having jurisdiction thereover any provisional or
         ancillary remedies, including but not limited to injunctive relief,
         foreclosure, sequestration, attachment, replevin, garnishment, or the
         appointment of a receiver. Such rights can be exercised at any time,
         before or during initiation of an arbitration proceeding, except to the
         extent such action is contrary to the arbitration award. The exercise
         of such rights shall not constitute a waiver of the right to submit any
         Dispute to arbitration, and any claim or controversy related to the
         exercise of such rights shall be a Dispute to be resolved under the
         provisions of this arbitration clause. Any party may initiate
         arbitration with the Administrator; however, if any party initiates
         litigation and another party disputes any allegation in that
         litigation, the disputing party--upon the request of the initiating
         party--must file a demand for arbitration with the Administrator and
         pay the Administrator's filing fee. The parties may serve by mail a
         notice of an initial motion for an order of arbitration. (f)
         Notwithstanding the applicability of any other law to this agreement,
         the arbitration clause, or Related Documents between or among the
         parties, the Federal Arbitration Act, 9 U.S.C. Section 1 et seq., shall
         apply to the construction and interpretation of this arbitration
         clause.

GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, protest and notice of dishonor. Upon any change
in the terms of this Note, and unless otherwise expressly stated in writing, no
party who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability. All such parties agree that Lender
may renew or extend (repeatedly and for any length of time) this loan, or
release any party or guarantor or collateral; or impair, fail to realize upon or
perfect Lender's security interest in the collateral; and take any other action
deemed necessary by Lender without the consent of or notice to anyone. All such
parties also agree that Lender may modify this loan without the consent of or
notice to anyone other than the party with whom the modification is made. PRIOR
TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS
NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER

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AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF
THE NOTE.

COLLATERAL: THIS PROMISSORY NOTE IS SECURED BY A COMMERCIAL PLEDGE AGREEMENT AND
A COMMERCIAL SECURITY AGREEMENT BOTH OF EVEN DATE.


BORROWER:  COVOL TECHNOLOGIES, INC.

By: /s/ Kirk A. Benson
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   KIRK A. BENSON, CHAIRMAN & CEO

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