EMPLOYMENT AGREEMENT

                                 By and Between

                            COVOL TECHNOLOGIES, INC.

                                       And

                                Steven G. Stewart


                                 Effective as of

                                   May 1, 1998








<PAGE>


                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT  AGREEMENT (this Agreement@) is effective as of the 1st
day of May, 1998 (the AEffective Date@) by and between COVOL TECHNOLOGIES,  INC.
a Delaware Corporation (the ACompany@), and Steven G. Stewart (AEmployee@).  The
Company and Employee are sometimes later in this Agreement collectively referred
to as the AParties.@

                                    RECITALS

         This Agreement is entered into with  reference to the following  facts,
definitions, and objectives:

         A. Employee is a Certified Public  Accountant and immediately  prior to
his  employment  by the  Company,  was  employed by Coopers & Lybrand,  LLP as a
Business Assurance Partner.

         B. Employee=s  services are deemed to be of value to the Company and it
is  recognized  that  inducements  must be offered to Employee in order that the
company may obtain and retain Employee=s services.

         NOW THEREFORE,  in consideration of this Agreement and of the covenants
and conditions contained in this Agreement, the Parties agree as follows:

         1.       Employment and Positions.

                  (a)  Positions.  The Company  employed  Employee  and Employee
accepted  employment  by the Company as an officer of the Company with the title
of AVice  President  of Finance  and  Treasurer@  for the  Period of  Employment
specified  in  Paragraph 3 (APeriod of  Employment@).  Such  position and title,
including related duties and responsibilities, may be changed during the term of
this  contract  provided  that such  Employee  continues  as an  officer  of the
Company.  Also, provided further that any new position would be of comparable or
higher responsibility level with compensation for such services at a level at or
above the Employees then current  compensation  level prior to such title and/or
position change.

         2. Services to be Rendered.  The Employee  shall,  during the Period of
Employment,  serve  the  Company  in the  positions  set  forth in  Paragraph  1
(AEmployment and Positions@)  diligently,  competently,  and in conformance with
the corporate policies of the Company. Employee shall have the responsibility to
always act in the best  interest of the Company  and  recognizes  opportunities,
ideas,  and intellectual  property  relating to the business of the Company that
are developed as an officer or employee of Covol  Technologies,  Inc. remain the
property of Company.  In fulfilling his duties and  responsibilities  under this
Agreement,  Employee  shall report to the President  and/or the Chief  Executive
Officer of the Company.

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         3. Period of Employment.  Employee=s employment by the Company pursuant
to this Agreement  shall,  began as of May 1, 1998 (the AEffective  Date@).  The
period  of  employment  continues  for a period  of  three  (3)  years  from the
Effective Date (APeriod of  Employment@)  renewing  annually on May 1st so as to
result in a continuing effective period of three (3) years from the renewal date
until normal retirement or resignation by the employee.

         4. Base  Salary.  At the  commencement  of the  Period  of  Employment,
Employee  shall be paid a yearly base salary of  $80,000.  Base salary  shall be
paid in semi  monthly  installments  during the Period of  Employment.  The base
salary will be increased effective May 1, 1999 by 25% to a yearly base salary of
$100,000.  The base salary will be  increase  effective  May 1, 2000 by 25% to a
yearly base salary of  $125,000.  It is  recognized  by the Company and Employee
that a Salary Compensation Study has recently been conducted and the base salary
of this  Employee  may be  adjusted  in the  future as a result  of this  Salary
Compensation  Study. If and when the base salary is adjusted as a result of this
study,  the salary  increases as provided in this  paragraph will be adjusted so
that the increase will not result in the  percentage  reflected  herein but will
instead result in the actual dollar amount increases set forth herein of $20,000
and $25,000 in the respective years.

         5. Incentive Bonus. During the Period of Employment,  Employee shall be
entitled to receive a bonus pursuant to the Company=s  bonus plan, if any, as in
effect  from  time to time.  It is  recognized  that a bonus  plan,  if any,  is
established at the discretion of the Company and may be subject to variables and
conditions including income performance and general performance evaluations.

         6.  Expense  Reimbursement.  The  Employee  shall be entitled to prompt
reimbursement  for  reasonable  expenses  incurred by the Employee in performing
services  for the  Company.  Employee  shall be  required  to provide  proof and
documentation of such expenditures as required by the Company.

         7. Grant of  Options.  The  Company  may grant from time to time to the
Employee,  in accordance with the terms of a stock option  agreement,  the right
and option to purchase shares of the Company=s Common Stock .

                  (a) Stock  Options  Pursuant to Stock Option  Plan.  Any Stock
Options  (AStock  Option@)  issued  shall be issued  pursuant and subject to the
provisions of the Company  Employee  Stock Option Plan (the AStock Option Plan@)
or as approved by the Board of  Directors.  Number of options,  purchase  price,
exercise periods and vesting  requirements shall be included in the stock option
document.

                  (b)  Vesting  of  Options  in  Event  of  Full  and   Complete
Disability  or Death.  In the event of full and complete  disability or death of
the employee any unvested  Stock Options shall vest  effective as of the date of
the full and  complete  disability  or the  death of  Employee.  In the event of
Employee=s full and complete disability or death, the Employee,  heirs or estate
of Employee, as the case may be, may exercise any unexecuted options at any time
subject to the time limitations within which exercise of option must occur.

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                  (c) Vesting of Options in Event of  Ownership  Change.  In the
event a change in control,  all non-vested  Stock Options shall vest immediately
prior to such stock or asset  purchase.  A change in control  shall be deemed to
have taken  place if, as the result of a tender  offer,  merger,  consolidation,
sale of  substantially  all  assets,  a third party  purchase  of a  controlling
interest of the total outstanding  shares of the Company,  or any combination of
the  foregoing  transactions,  the person s who were  directors  of the  Company
immediately  before the transaction  shall cease to constitute a majority of the
board of directors of the Company or any successor to the Company. The intent of
this section is to allow the Employee to exercise any unexercised options at the
Employee=s discretion.

                  (d)  Options   Granted.   In  connection  with  acceptance  of
employment as provided  herein,  Employee is granted  qualified  incentive stock
options under the Company  Employee Stock Option Plan to purchase  50,000 shares
of the Company=s Common Stock at a price of $12.625.  These options will vest on
a  pro-rata  basis  over 60 months  beginning  May 1,  1998 and are  exercisable
through April 30, 2008.

                  8. Other Benefits.  In addition to the benefits previously set
forth in this  Agreement,  Employee shall,  during the Period of Employment,  be
entitled to the  benefits  described  below,  and as concerns  all such  benefit
programs  where years of service are a factor,  to the extent  permitted by law,
Employee shall be given credit for his years of service with Covol Technologies,
Inc. prior to the implementation of any benefit program.

                  (a) Vacation. During the Period of Employment,  Employee shall
be entitled to not less than four weeks of paid  vacation  during each  calendar
year  occurring  during the Period of  Employment.  Any and all unused  vacation
will,  at the  Company's  option,  be paid for by the Company at the end of each
calendar  year,  or will  carry  forward  from year to year  until  taken by the
Employee or paid the Employee by the Company.  Upon  termination  of  Employee=s
employment under this Agreement,  Employee shall be paid for any unused vacation
in the year in which the  termination  occurred,  and vacation  will continue to
accrue up to and including the termination  date in  proportionate to the amount
of time employed during that year.

                  (b) Sick  Leave.  Leave time will be  granted to the  Employee
that is  reasonable  under the  circumstances  and that is  consistent  with the
Company=s  policies  and  procedures,  as the same may be  changed,  modified or
provided for other officers of the Company from time to time.

                  (c) Insurance. Participation in the group insurance program of
the Company as concerns life, disability, medical and dental insurance currently
available to other employee=s as the same may be implemented,  changed, modified
or terminated for all participants from time to time. Employee shall be required
to pay that portion of the premiums for coverage  under such  insurance  that is
payable by other officers of the Company for their insurance coverage.

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<PAGE>

                  (d) Retirement  Plan.  The Employee  shall  participate in the
Company=s  Retirement  Plans in  accordance  with the  terms and  provision  and
applicable law as the same may be implemented,  changed,  amended, or terminated
from  time to  time.  Employee  shall  become  eligible  to  participate  in the
Company=s  Retirement  Plans at date of hire or as of the effective  date of the
implementation of such plans, whichever is later.

                  (e)  Automobile  Allowance.   The  Company  will  provide  the
Employee a monthly  automobile  allowance.  This  allowance is to compensate the
Employee for the use of his personal  automobile in the amount of $550 per month
during the Employment Period

                  (f) Other  Miscellaneous  Benefits.  The Company  shall pay or
reimburse Employee for the following miscellaneous benefits:

                           (i)  Annual  dues  for  association   membership  for
relevant  professional  groups and  organizations  as deemed  appropriate by the
Employee.

                           (ii)  Subscription  and purchase of books,  journals,
and publications which relate to job duties and responsibilities.

Employee shall first obtain  authorization for payment or purchases  referred to
in (i) and (ii) from the President of the Company before incurring such costs.

         9.       Terms of Employment.

                  (a) Term.  The Company  hereby agrees to continue the Employee
in its employ,  and the  Employee  hereby  agrees to remain in the employ of the
Company,  in  accordance  with the terms and  provisions  of paragraph 3 of this
Agreement, for the Period of Employment, thus terminating upon the retirement of
the Employee,  upon resignation of the Employee,  or upon thirty (30) days prior
written notice from the Company to the Employee of termination for cause.

                  (b) During the Period of Employment.  The Employee=s  services
shall be performed at the location  where the Employee was employed  immediately
preceding the Effective Date or at any office which is the  headquarters  of the
Company.

         10.      Termination of Agreement.

                  (a)  Termination  of Employment by Employer.  Anything in this
Agreement to the contrary notwithstanding,  the Company shall have the following
rights with respect to termination of Employee=s employment.

                           (i) Disability.  The Company may terminate Employee=s
employment  under this  Agreement if Employee shall become unable to fulfill his
duties  under this  Agreement,  as  measured  by the  Company=s  usual  business
activities,  by reason of any  medically  determinable  physical  and/or  mental
disability.

                           (ii) Cause.  Employee=s  employment may be terminated
for Cause.  For  purpose  of the  Agreement,  ACause@  shall mean and refer to a
determination made in good faith by the Company=s Board of Directors that:

                                    (1)  Employee  has been  convicted of or has
entered a plea of guilty or nolo  contendere  to a felony or to any other crime,
which other crime is punishable by incarceration for a period of one (1) year or
longer, or which is a crime involving moral turpitude;

                                    (2) there has been a theft, embezzlement, or
other criminal  misappropriation  of funds by Employee,  whether from Company or
any other person;

                                    (3) Employee has willfully  failed to follow
reasonable written policies or directives  established by the Board of Directors
or the Chief Executive  Officer of the Company.  Additionally,  the Employee has
willfully  failed to attend to  material  duties or  obligations  of  Employee=s
office (other than any such failure resulting from Employee=s  incapacity due to
physical or mental  illness,  which is a cause or  manifestation  of  Employee=s
disability),  which failure or refusal  continues for ninety (90) days following
delivery of a written  demand from the  Company=s  Chief  Executive  Officer for
performance to Employee  identifying  the manner in which Employee has failed to
follow such policies or directives or to perform such duties.

                           (iii) Termination pursuant to this Paragraph 10 shall
be effective as of the  effective  date of the notice by the Board of Directors,
Chief Executive Officer,  or President to Employee that it has made the required
determination,  or at such  other  subsequent  date,  if any  specified  in such
notice.

                           (iv)  Death.  If  Employee  dies during the Period of
Employment, Employee=s employment shall be terminated effective as of the end of
the calendar month during which Employee died.

         (b)      Termination by Employee.

                  (i)  With  Good  Reason.  Employee  shall  have  the  right to
terminate  his  employment  under this  Agreement  at any time for Good  Reason,
provided  Employee has  delivered  written  notice to the Company  which briefly
describes the facts  underlying  Employee=s  belief that AGood Reason@ exist and
the Company has failed to cure such situation  within thirty (30) days after the
effective  date of such notice.  For purposes of the  Agreement,  AGood  Reason@
shall mean and consist of:

                                    (1) a material  breach by the Company of its
obligations under this Agreement;

                                    (2) the  assignment  to  Employee  of duties
that are materially  inconsistent with, or that constitute a material alteration
in the  status  of  his  responsibilities  set  forth  in  Paragraph  1 of  this
Agreement, as an employee of the Company;

                                    (3) a reduction by the Company of Employee=s
Base Salary below the Base Salary set forth in Paragraph 5 (ABase Salary@);

                                    (4)   without   Employee=s   prior   written
consent,  the transfer or relocation  of  Employee=s  place of employment to any
place  other  than  the Salt  Lake  City/Provo  metropolitan  area,  except  for
reasonable travel on the business of the Company;

                                    (5) upon a change of  control  as defiend in
Paragraph 6(c) herein, or

                                    (6) upon the  consummation  of a third party
purchase  of a  controlling  interest  of the  total  outstanding  shares of the
Company.

         11.  Confidential  Information.  The Employee shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential  information,
knowledge or data relating to the Company or any of its affiliated companies and
their respective businesses,  which has been obtained by the Employee during the
Employee=s  employment  by the Company or any of its  affiliated  companies  and
which  shall  not be or  become  public  knowledge  (other  than  by acts by the
Employee or  representatives  of the Employee in  violation of this  Agreement).
After  termination of the Employee=s  employment with the Company,  the Employee
shall not,  without prior written  consent of the Company or as may otherwise be
required by law or legal process,  communicate or divulge any such  information,
knowledge or data to anyone other than the Company and those  designated  by the
Company.  In no event  shall an asserted  violation  of the  provisions  of this
Section  constitute a basis for deferring or withholding  any amounts  otherwise
payable to the Employee under the provisions of this Agreement.

         12.      Inventions.

                  (a) Assignment.  Without further  consideration,  the Employee
shall fully and promptly  report to the Company all writings,  ideas,  concepts,
inventions,  discoveries,  formulas, designs, and know-how conceived or produced
by the  Employee  at any time  during the Period of  Employment  relating to the
Company=s  trade or  business,  whether  alone or with others and whether or not
patentable or subject to copy or service  rights or trademark or other  property
protections (collectively, AInventions@ pertaining directly or indirectly to the
business  of the  Company as  conducted  by the  Employee at any time during the
Employment Period) and shall assign and hereby does assign to the Company or its
nominee  the  Employee=s  entire  right,  title and  interest in and to all such
Inventions.

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<PAGE>


                  (b) Cooperation. The Employee shall take all reasonable action
requested by the Company to protect or obtain title to any and all United States
and/or foreign patents on any such Inventions,  including execution and delivery
of all  applications,  assignments  and  other  documents  deemed  necessary  or
desirable by the Company,  provided the Company shall reimburse the Employee for
all expenses  incurred by the Employee in  connection  with such  execution  and
delivery.

         13.      Non-Competition after Termination.

                  (a)  Acknowledgment.   The  Employee   acknowledges  that  his
services and  responsibilities  are of a particular  significance to the Company
and that his  position  with the Company  does and will  continue to give him an
intimate  knowledge  of its  business.  Because of this,  it is important to the
Company that the Employee be restricted  from  competing with the Company in the
event of the termination of his employment.

                  (b)  Agreement.  The Employee  agrees that, in addition to any
other  limitations,  for a period of two (2) years after the  termination of his
employment  under this  Agreement,  the Employee will not directly or indirectly
compete with the Company or its business.

         14.  Severance Pay.  Except for  termination  for Cause under Paragraph
10(a)(iii)  herein,  if the  Employee  does not  continue  in the  employ of the
Company during the Period of Employment as provided in this  Agreement,  whether
or not the Employee is offered  continued  employment  by the  Company,  Company
shall  pay  to  Employee,  no  later  than  30  days  following  termination  of
employment,  the sum of 200% of the then current year=s annual base salary.  The
Employee  shall not be required to mitigate  the amount of the payment  provided
for in this section by seeking  other  employment  or  otherwise;  nor shall the
amount of the payment be reduced by any  compensation  earned by the Employee as
the result of employment by another employer after termination or otherwise.

         15.   Indemnification.   Subject  to  the  Company's   Certificate   of
Incorporation,  as  amended,  the  Company  shall  release,  indemnify  and hold
harmless  the  Employee  against and from any and all loss,  claims,  actions or
suits,  including  costs  and  attorney=s  fees,  both at trial  and on  appeal,
resulting  from, or arising out of or in any way connected  with the  Employee=s
acts as an officer of the Company.

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         16.  Miscellaneous.  Any  notice or other  communications  required  or
permitted  to be given to the parties  hereto shall be deemed to have been given
when  received,  addressed  as follows  (or at such  other  address as the party
addressed may have substituted by notice pursuant to this Section):


                  (a)      If to the Company:

                           President and/or Chief Executive Officer
                           3280 North Frontage Road
                           Lehi, Utah
                           Attention: President and CEO


                  (b)      If to Employee:

                           Steven G. Stewart
                           187 South 1225 East
                           Bountiful, Utah  84010


         17. Governing Law. This Agreement shall in all respects be interpreted,
construed and governed by and in accordance with the laws of the State of Utah.


                  Executed this 4th day of January, 1999:

Covol Technologies, Inc.:                            Employee:



By:______________________________                    __________________________
     Brent M. Cook                                   Steven G. Stewart
     Chief Executive Officer


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