Document:

Exhibit 10.74

                            ASSET PURCHASE AGREEMENT

                                 by and between

                             HEADWATERS INCORPORATED

                                       and

                              RED HAWK ENERGY, LLC

                                December 28, 2001

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                            ASSET PURCHASE AGREEMENT

         ASSET PURCHASE AGREEMENT,  made as of December 28, 2001, by and between
HEADWATERS INCORPORATED, a Delaware corporation ("Seller"), and Red Hawk Energy,
LLC, a California limited liability company ("Buyer").

                                    RECITALS

         WHEREAS,  Seller owns the Assets  comprised  of a Facility  (as defined
herein) to manufacture synthetic fuel from coal located in Utah County, Utah;

         WHEREAS, Seller desires to sell an undivided 50% interest in the Assets
to Buyer and Buyer  desires to purchase an undivided  50% interest in the Assets
from Seller,  all on the terms and subject to the  conditions  set forth herein;
and

         WHEREAS,  Buyer  and  Seller  intend  to  contribute  their  respective
interests  in the Assets to a limited  liability  company  and to  relocate  the
Facility to a location in Carbon County, Utah.

         NOW,  THEREFORE,  in  consideration  of the  Recitals and of the mutual
covenants,  conditions  and  agreements  set forth herein and for other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, it is hereby agreed that:

                                    ARTICLE I
                                   DEFINITIONS

         When  used in this  Agreement,  the  following  terms  shall  have  the
meanings specified:

         1.1. Affiliate shall mean, as to any person, any other person or entity
that, directly or indirectly through one or more  intermediaries,  controls,  is
controlled by or is under common control with such person.  For purposes of this
definition,  "control" (including,  with correlative meanings,  the terms "under
common control with" and  "controlled  by"), as used with respect to any person,
means the  possession,  directly or indirectly,  of the power to direct or cause
the direction of the management or policies of such person,  whether through the
ownership of voting stock or other equity interests, by contract or otherwise.

         1.2. Agreement shall mean this Asset Purchase Agreement,  together with
the Exhibits and Schedules attached hereto, as the same may be amended from time
to time in accordance with the terms hereof.

         1.3.  Assets  shall mean,  collectively,  the Books and Records and the
Fixed Assets, together with all goodwill associated with the Facility.

         1.5.  Bill of Sale  shall  mean the Bill of Sale  from  Seller to Buyer
relating to the Assets, in the form of Exhibit A attached hereto.

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         1.5. Books and Records shall mean original or true and complete  copies
of all of the books, records,  files, data and information of Seller relating to
the design, ownership,  construction and operation of the Facility and operation
of the Assets prior to the Effective Time,  which are relevant to Buyer's use of
the Assets and  operation of the Facility  after the Effective  Time,  including
without limitation Plans and Specifications.

         1.6.  Buyer's Closing  Certificate  shall mean the certificate of Buyer
substantially in the form of Exhibit B attached hereto.

         1.7.  Closing  shall mean the meeting of the parties to be held at 5:00
p.m.,   local  time,   on  the  Closing  Date,  at  the  offices  of  Headwaters
Incorporated,  or such other time and place as the parties may mutually agree in
writing.

         1.8.  Closing Date shall mean  December 28, 2001, or such other date as
the parties may mutually agree in writing.

         1.9. Coal Supply Agreement shall mean the coal supply agreement between
ETG and Red Hawk Energy, LLC executed as of the Closing.

         1.10. Confidentiality Agreement shall mean the confidentiality
agreement, dated December 28, 2001, between Seller and Buyer.

         1.11. Construction Report shall mean such report prepared by Buyer and
Seller or their consultants, in form and substance satisfactory to Buyer and
Seller, to the effect that the costs for the relocation, construction and
testing of the Assets and appurtenances thereto at the Site shall not exceed
$550,000.

         1.12. Effective Time shall mean 12:01 a.m., Mountain Time, on the
Closing Date.

         1.13. Environmental Technologies Group, LLC Articles of Organization
shall mean the certificate of organization for ETG executed as of the Closing.

         1.14. Environmental Technologies Group, LLC Operating Agreement shall
mean the limited liability company operating agreement for ETG executed by Buyer
and Seller as of the Closing.

         1.15. ETG shall mean Environmental  Technologies Group, LLC, the entity
to which the Assets shall be contributed at Closing.

         1.16. ETG Transfer Documents shall mean the bill of sale and/or other
documents which are required to evidence the transfer of the Assets from Seller
and Buyer to ETG at Closing.

         1.17.  Facility  shall  mean  the  coal  processing  facility  commonly
referred to as the Geneva facility owned by Seller at the Facility Site.

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         1.18. Facility Site shall mean the site where the Facility is currently
located in Utah County, Utah.

         1.19. Fixed Assets shall mean all tangible personal property  currently
located at the Facility Site which  constitute  part of, or are otherwise  owned
and used by Seller in the operation of, the Facility, including, but not limited
to, all personal  property,  trade  fixtures,  chattels,  machinery,  equipment,
computer  hardware,  fixtures,  furniture,   furnishings,   handling  equipment,
implements, spare parts, tools and accessories of all kinds.

         1.20. GAAP shall mean generally accepted  accounting  principles of the
United States as applied by Seller in a manner consistent with prior periods.

         1.21.  Knowledge  of Buyer shall mean the actual  knowledge,  after due
inquiry, of the Buyer.

         1.22.  Knowledge of Seller shall mean the actual  knowledge,  after due
inquiry, of the Seller.

         1.23.  Law  shall  mean any  federal,  state,  local  or  other  law or
governmental  requirement  of any kind,  and the rules,  regulations  and orders
promulgated thereunder.

         1.24.  Lease shall mean the site lease for the Facility upon relocation
as  contemplated  in Section 5.5 or a commitment  to lease in form and substance
acceptable to both Seller and Buyer.

         1.25. Lien shall mean any interest in property  securing an obligation,
whether such interest is based on common law, statute or contract, and including
any  restriction  on the use,  voting,  transfer,  receipt  of  income  or other
exercise of any attributes of ownership,  any security  interest or lien arising
from a mortgage,  claims,  encumbrance,  pledge,  charge,  easement,  servitude,
security agreement, conditional sale or trust receipt or a lease, consignment or
bailment for  security  purposes.  The term "Lien"  shall also include  pledges,
equities,  charges,  assessments,  defects  in  title,  encroachments  and other
burdens,  and other title exceptions and encumbrances  affecting property of any
nature, whether accrued or unaccrued, or absolute or contingent.

         1.26.  Losses  shall  have the  meaning  given to such term in  Section
8.1(a).

         1.27.  Material  Adverse Effect shall mean a material adverse effect on
the Assets,  taken as a whole,  the business to be conducted  with the Assets or
the ownership, maintenance and operation of the Facility.

         1.28.  Note shall mean the promissory  note in the amount of $2,000,000
made by Buyer and payable to Seller in the form of Exhibit C attached hereto.

         1.29.  Operations  and  Maintenance  Agreement  shall mean the Facility
operations and maintenance  agreement  between ETG and Seller executed as of the
Closing.

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         1.30. Permit Report shall mean such report prepared by Buyer and Seller
or their consultants, in form and substance satisfactory to Buyer and Seller, to
the  effect  that the  permits  required  for the  construction,  operation  and
maintenance  of the  Assets at the Site have been  obtained  or can be  obtained
without restriction within three months of the Closing Date.

         1.31.  Permitted  Liens  shall mean Liens (but only for amounts not yet
due and payable) securing taxes,  assessments or governmental charges or levies,
and Liens of an immaterial nature which could not reasonably be expected to have
an adverse effect on the ownership, maintenance and operation of the Facility or
the good and marketable title of the Assets.

         1.32. Plans and Specifications  shall mean the plans and specifications
used to engineer, procure, and construct the Facility.

         1.33. Purchase  Consideration shall have the meaning given to such term
in Section 2.2 hereof.

         1.34.  Required  Consents  shall mean  those  consents,  approvals  and
waivers required from  governmental  authorities or other third parties that are
necessary  or required in order to  transfer  the Assets to Buyer and  otherwise
give effect to the transactions  contemplated  herein (other than such consents,
the  failure  of which to  obtain,  taken as a whole,  could not  reasonably  be
expected to have a Material Adverse Effect) and that are specifically identified
on Schedule 1. attached hereto.

         1.35. Seller's Closing Certificate shall mean the certificate of Seller
substantially in the form of Exhibit D attached hereto.

         1.36. Site shall mean the real property  covered by the Lease where the
Facility will be relocated after the Closing.

         1.37.  Synthetic Fuel Purchase  Agreement shall mean the synthetic fuel
purchase  agreement between ETG and Red Hawk Energy,  LLC, a California  limited
liability company, executed as of the Closing.

         1.38.  Technology  License and Reagent Supply  Agreement shall mean the
technology  license and supply  agreement  between ETG and Seller executed as of
the Closing.

         1.39. Transaction Documents shall mean:

                  (a) this Agreement;

                  (b) the Bill of Sale;

                  (c) the Note;

                  (d) the  Environmental  Technologies  Group,  LLC  Articles of
         Organization;

                  (e)  the  Environmental  Technologies,  Group,  LLC  Operating
         Agreement;

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                  (f) the Technology License and Reagent Supply Agreement;

                  (g) the Lease;

                  (h) the Operations and Maintenance Agreement;

                  (i) the Coal Supply Agreement;

                  (j)  the  coal  supply  agreement  between  Buyer  and  Seller
         executed as of the Closing;

                  (k) the Synthetic Fuel Purchase Agreement;

                  (l) the synthetic  fuel purchase  agreement  between Buyer and
         Seller executed as of the Closing;

                  (m) the ETG Transfer Documents;

                  (n) the option agreement  between Buyer and Seller executed as
         of the Closing Date;

                  (o) the Permit Report;

                  (a) the Construction Report;

                  (q) the Buyer's Closing Certificate;

                  (r)  the  Seller's   Closing   Certificate;   and  such  other
         agreements and instruments as may be contemplated by this Agreement.

                                   ARTICLE II
                                PURCHASE AND SALE

         2.1.  Purchase  and Sale.  Buyer and  Seller  hereby  agree that at the
Closing,  and upon all of the terms and subject to all of the conditions of this
Agreement,  Seller shall sell,  convey,  transfer and assign to Buyer, and Buyer
shall  purchase and accept from Seller,  an undivided 50% interest in all of the
Assets, free and clear of all Liens, except Permitted Liens.

         2.2.  Purchase  Consideration.   In  consideration  of  Seller's  sale,
conveyance, transfer, delivery and assignment to Buyer by the Bill of Sale of an
undivided  50%  interest  in the  Assets,  at the  time of the  Closing  of this
Agreement,  Buyer shall (i) execute and deliver the Note,  (ii) pay to Seller in
immediately  available funds the sum of One Hundred Twenty Five Thousand Dollars
($125,000). In addition, Buyer shall pay to Seller the sum of One Hundred Twenty
Five Thousand  Dollars  ($125,000)  at the earlier of (i) 30 days  following the
Closing Date, or (ii) execution of the Lease. (The foregoing  collectively,  the
"Purchase Consideration".)

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         2.3. Deliveries at Closing.

                  (a) By Seller to Buyer.  At the  Closing,  in  addition  to an
         undivided  50%  interest  in  the  Assets,  Seller  shall  deliver  the
         following  items to Buyer,  each properly  executed and dated as of the
         Closing Date by Seller and in form and substance reasonably  acceptable
         to Buyer:

                           (i) all Required Consents applicable to Seller in its
                  own capacity and to Seller in its  capacities  as a member and
                  manager of ETG,

                           (ii) a  certificate  of the  corporate  secretary  of
                  Seller as to such  matters as may  reasonably  be requested by
                  Buyer, and

                           (iii) all Transaction Documents.

                  (b) By Buyer to Seller.  At the Closing,  Buyer shall  deliver
         the Purchase  Consideration  and the  following  items to Seller,  each
         properly executed and dated as of the Closing Date by Buyer and in form
         and substance reasonably acceptable to Seller:

                           (i) all Required Consents applicable to Buyer, in its
                  own capacity and to Buyer in its capacity as a member of ETG,

                           (ii) a certificate of the manager of Buyer as to such
                  matters as may reasonably be requested by Seller, and

                           (iii) all Transaction Documents.

         2.4. No Assumption of Liabilities.

         Buyer does not and will not assume any  liability or  obligation of any
kind of Seller, or any obligation relating to the use of the Assets prior to the
Effective Time, whether absolute or contingent,  accrued or unaccrued,  asserted
or unasserted, known or unknown, or otherwise.

         2.5. Sales Tax Exemption.

         To the extent applicable,  at the Closing, Buyer will deliver to Seller
appropriate  and  customary  sales tax  exemption  certificates  relating to the
transfer of the Assets contemplated hereby.

                                   ARTICLE III
                    REPRESENTATIONS AND WARRANTIES OF SELLER

         Seller represents and warrants to Buyer that:

         3.1. Corporate Standing.

         Seller is a corporation duly organized and validly existing and in good
standing  under the laws of the state of  Delaware.  Seller has the power to own
its property, and to execute, deliver and perform this Agreement and each of the

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Transaction  Documents  applicable  to it, and to carry on its  business  as now
being  conducted.  Seller is duly  qualified  to do  business  in and is in good
standing as a foreign  corporation  authorized to do business  under the laws of
the State of Utah.

         3.2. Authorizations; Binding Agreements.

         The execution, delivery and performance of this Agreement and the other
Transaction Documents by Seller and each conveyance,  assignment, agreement, and
other  document  herein  contemplated  to be executed by Seller,  have been duly
authorized  by all  necessary  corporate  action.  This  Agreement and the other
Transaction Documents and the conveyances,  assignments,  agreements,  and other
documents herein contemplated to be executed,  delivered and performed by Seller
are, or will be upon execution,  legal, valid and binding obligations of Seller,
duly  enforceable  against  Seller in  accordance  with  their  terms  (subject,
however, to the effects of bankruptcy, insolvency,  reorganization,  moratorium,
and similar Laws from time to time in effect relating to the rights and remedies
of creditors as well as to general principles of equity). This Agreement and the
other Transaction Documents and the conveyances,  assignments,  agreements,  and
other documents herein  contemplated to be executed,  delivered and performed by
Seller  (i) do not and will not result in any  violation  of,  conflict  with or
default under the terms of any of Seller's organizational documents (nor, to the
Knowledge of Seller,  does there exist any  condition  which upon the passage of
time or the giving of notice would cause such  violation,  conflict or default),
and (ii) subject only to the  Required  Consents,  do not and will not result in
any  violation  of,  conflict  with or default  under any  contract or any other
material permit,  lease,  venture,  indenture,  mortgage,  agreement,  contract,
judgment,  order or other obligation or restriction to which Seller,  the Assets
or the conduct of the  maintenance and operation of the Facility may be bound or
encumbered  (nor,  to the  Knowledge of Seller,  does there exist any  condition
which  upon the  passage  of time or the  giving  of  notice  would  cause  such
violation, conflict or default).

         3.3. No Actions  Affecting  Enforcement  of the Agreement and the other
Transaction Documents.

         There  are no  actions,  suits,  or  proceedings  pending,  or,  to the
Knowledge of Seller, threatened,  against Seller in any court, or administrative
governmental  body or agency which will affect in any adverse manner the ability
of  Seller  to  execute,  deliver  and  perform  this  Agreement  and the  other
Transaction  Documents.  Subject only to the Required Consents and such consents
which the failure to obtain could not  reasonably be expected to have a Material
Adverse  Effect,  Seller  has  obtained  all  permits,   licenses,   franchises,
authorizations, variances, exemptions, concessions, leases, instruments, orders,
consents or approvals of  governmental  entities and third parties  necessary to
execute, deliver and perform this Agreement and the other Transaction Documents.

         3.4. Taxes.

         All tax returns  and reports  relating to the Assets and the conduct of
the construction,  ownership, maintenance and operation of the Facility required

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by Law (including  all federal,  state,  and local  property tax,  severance and
franchise  tax Laws) to be filed by Seller prior to the Closing have been timely
filed or will be caused to be timely filed, including those tax returns relating
to periods  prior to Closing  that are not yet due,  except for such returns and
reports  which the  failure to file could not  reasonably  be expected to have a
Material  Adverse  Effect  on the  Assets  or  the  ownership,  maintenance  and
operation of the Facility and the relocation  thereof.  All taxes,  assessments,
fees, interest,  penalties and other governmental charges relating to the Assets
or the conduct of the construction,  ownership, maintenance and operation of the
Facility  prior to Closing  have been paid when due and  payable or payment  has
been provided for, except for such taxes, assessments, fees, interest, penalties
and other governmental  charges which the failure to pay could not reasonably be
expected to have a Material  Adverse  Effect on the Assets or the  construction,
ownership, maintenance and operation of the Facility.

         3.5. Brokers or Finders Fees.

         Except  as set  forth  in  Schedule  3.5,  there  is no  obligation  or
liability,  contingent  or  otherwise,  for brokers or finders  fees  created by
Seller with respect to the matters  provided for in this Agreement and the other
Transaction  Documents.  No  obligation or liability for brokers or finders fees
created by Seller with respect to the matters provided for in this Agreement and
the other Transaction Documents shall be imposed upon Buyer or the Assets.

         3.6. No Imposition of Liens.

         The execution, delivery and performance of this Agreement and the other
Transaction  Documents by Seller shall not result in the imposition of any Lien,
other than  Permitted  Liens,  upon any of the Assets or by which the ownership,
maintenance and operation of the Facility may be bound or encumbered.

         3.7. Title to Assets.

         (a) As of the date hereof,  Seller owns, and as of the Effective  Time,
it will own,  good,  valid and marketable  title to all of the Assets,  free and
clear of any and all Liens, except for Permitted Liens. As of the Effective Time
and upon Buyer's payment of the Purchase  Consideration  pursuant hereto,  good,
valid and  marketable  title to an undivided 50% interest in the Assets free and
clear of all Liens, except for Permitted Liens, shall pass to Buyer.

         (b) The Assets  constitute all property and equipment  required for the
operation  of a  facility  to  manufacture  synthetic  fuel  from  coal  with an
estimated annual rated capacity of not less than 150,000 tons; provided that the
Assets do not  necessarily  include  (i)  material  handling  equipment  for the
delivery of feedstock and reagent to, and the removal of finished  product from,
the Facility,  such as trucks,  loaders,  conveyor belts and shovels,  (ii) site
specific  property and  equipment,  such as suitable real estate and building to
house the Facility,  storage areas, electrical cables and connectors and bracing
or mounting hardware, (iii) reagent and other consumables, (iv) a license to use
the  technology  for which the Facility was designed,  (v)  miscellaneous  nuts,
bolts,  belts and other standard  hardware which may have become lost or damaged

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in the  course of  disassembly,  storage,  moving and  re-assembly  or which are
considered wear items.

         (c) The Assets upon relocation to the Site pursuant to Section 5.5 will
be in operable condition.

         3.8. Pending Litigation.

         There are no actions,  suits,  arbitrations  or  proceedings  currently
pending or, to the Knowledge of Seller, threatened against the Assets. There are
no outstanding or  unsatisfied  judgments,  orders or decrees to which Seller is
bound.

         3.9. Compliance With Laws.

         To the  Knowledge  of Seller,  Seller and the Assets are in  compliance
with all orders, writs, injunctions, decrees, judgments, rulings, Laws, rules or
regulations  of any  governmental  entity to which  Seller  and the  Assets  are
subject,  the violation of which could reasonably be expected to have a Material
Adverse Effect.

         3.10. Consents

         Schedule  1.34 is a true,  correct and  complete  list of all  Required
Consents.

         3.11. Environmental Conditions.

         (a) Definitions. When used in this Section:

                  (i)  "Environmental  Laws"  shall  mean  all  applicable  laws
         (including  common  law),   rules,   orders,   regulations,   statutes,
         ordinances,   codes,  decrees  and  requirements  of  any  Governmental
         Authority  regulating,  relating to or imposing liability  standards of
         conduct concerning any Hazardous Materials or environmental protection.

                  (ii) "Governmental  Authority" shall mean any federal,  state,
         local, municipal or other governmental department,  commission,  board,
         bureau,  agency or  instrumentality,  or any court, in each case having
         jurisdiction over the applicable matter.

                  (iii)  "Hazardous  Materials"  shall  mean  any  solid  waste,
         petroleum or petroleum product,  hazardous  material,  hazardous waste,
         infectious  medical waste, or hazardous or toxic  substance  defined or
         regulated as such in any Environmental Law.

         (b) Environmental Representations and Warranties:

                  (i) Seller has not operated the Facility or conducted business
         or other  activities  at or from the Facility,  in connection  with the

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         construction of the Facility or otherwise, in a manner that constituted
         or constitutes a violation of any applicable Environmental Law;

                  (ii)  There has been no  off-site  shipment  or release of any
         Hazardous  Materials  by the Seller on,  under,  at, from or in any way
         affecting the Facility or any part thereof,  which off-site shipment or
         release  gives rise to  liabilities  or  obligations  under  applicable
         Environmental Laws; and

                  (iii) Seller has not received any notices or claims that it is
         a  responsible  party in connection  with any claim or notice  asserted
         pursuant to 42 U.S.C.  Section 9601 et seq.,  or any  comparable  state
         Environmental Law, in connection with the Facility.

         3.12. Liabilities.

         Except for liabilities  underlying any Permitted  Liens, the Seller has
no  liabilities  which could  reasonably be expected to have a Material  Adverse
Effect  following  the  Closing,  nor has any  condition  existed  or any  event
occurred which could reasonably be expected to give rise to any such liability.

         3.13. Factual Representations.

                  (a) Each of the material facts  regarding the Assets set forth
         in the due  diligence  information  delivered  to  Buyer  was  true and
         correct as of the date on which it spoke and  remains  true and correct
         as of the date hereof unless superceded by subsequent disclosures.

                  (b) The information  furnished by Seller to Buyer,  taken as a
         whole, does not contain any untrue statement of a material fact or omit
         to state a material  fact  necessary to make the  statements  contained
         therein statements not misleading.

                  (c)  Seller  does not have  knowledge  of any  fact,  event or
         circumstance which it is aware would render the Facility, as relocated,
         ineligible  for tax credits  under  Section 29 of the Internal  Revenue
         Code.

         3.14. Other Agreements.

         Other than the Transaction Documents, there are no contracts, licenses,
agreements or  arrangements  with Seller or any other person in connection  with
the construction,  maintenance,  ownership and operation of the Facility,  other
than as disclosed on Schedule 3.14.

         3.15 Section 29.

         Sales of synthetic  fuel from the Facility to unrelated  third  parties
will qualify for tax credits under Internal Revenue Code section 29 when claimed
by an eligible tax payer.

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                                   ARTICLE IV
                     REPRESENTATIONS AND WARRANTIES OF BUYER

         Buyer hereby represents and warrants to Seller that:

         4.1. Organization and Standing.

         Buyer is a limited liability company duly organized,  validly existing,
and in good standing under the laws of the State of California and has the power
to own its own property, and to execute,  deliver and perform this Agreement and
each of the  Transaction  Documents,  and to carry on its  business as now being
conducted.

         4.2. Authorizations; Binding Agreements.

         The  execution,  delivery,  and  performance  of this Agreement and the
other  Transaction  Documents  by  Buyer  and of  each  conveyance,  assignment,
agreement,  and other document herein  contemplated to be executed by Buyer have
been fully authorized by all necessary limited  liability  company action.  This
Agreement and the other Transaction Documents and the conveyances,  assignments,
agreements,  and other documents herein  contemplated to be executed,  delivered
and performed by Buyer are, or will be upon execution,  legal, valid and binding
obligations of Buyer,  duly  enforceable  against Buyer in accordance with their
terms   (subject,   however,   to  the   effects  of   bankruptcy,   insolvency,
reorganization,  moratorium,  and  similar  Laws  from  time to  time in  effect
relating  to the  rights  and  remedies  of  creditors  as  well  as to  general
principles of equity).  This Agreement and the other  Transaction  Documents and
the   conveyances,   assignments,   agreements,   and  other  documents   herein
contemplated  to be executed,  delivered  and  performed by Buyer (i) do not and
will not result in any violation of, conflict with or default under the terms of
Buyer's  organizational  documents,  and  (ii)  subject  only  to  the  Required
Consents,  do not and will not  result in any  violation  of,  conflict  with or
default  under  any  material  permit,  lease,  venture,  indenture,   mortgage,
agreement, contract, judgment, order or other obligation or restriction to which
Buyer is bound (nor, to the  Knowledge of Buyer,  does there exist any condition
which  upon the  passage  of time or the  giving  of  notice  would  cause  such
violation, conflict or default).

         4.3. Brokers or Finders Fees.

         Except  as set  forth  in  Schedule  4.3,  there  is no  obligation  or
liability, contingent or otherwise, for brokers or finders fees created by Buyer
with  respect  to the  matters  provided  for in this  Agreement  and the  other
Transaction  Documents.  No  obligation or liability for brokers or finders fees
created by Buyer with respect to the matters  provided for in this Agreement and
the other Transaction Documents shall be imposed upon Seller or the Assets.

         4.4. No Action  Affecting  Enforcement  of the  Agreement and the other
Transaction Documents.

         There  are no  actions,  suits,  or  proceedings  pending,  or,  to the
Knowledge of Buyer,  threatened,  against Buyer in any court, or  administrative

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governmental  body or agency which will affect in any adverse manner the ability
of  Buyer  to  execute,  deliver  and  perform  this  Agreement  and  the  other
Transaction Documents.

                                    ARTICLE V
                      CERTAIN UNDERSTANDINGS AND AGREEMENTS

         5.1. Reasonable Efforts.

         Subject  to the  terms  and  conditions  herein  provided,  each of the
parties  hereto agrees to use its  commercially  reasonable  efforts to take, or
cause to be  taken,  all  action,  and to do,  or cause to be done,  all  things
necessary, proper and advisable under applicable Law, and to obtain the Required
Consents,   necessary  to  consummate  and  make   effective  the   transactions
contemplated by this Agreement, including, but not limited to, relocation of the
Assets.  In case at any time  after the  Effective  Time any  further  action is
necessary or desirable to carry out the purposes of this  Agreement,  the proper
officers  and  members  of each  party  to this  Agreement  shall  take all such
necessary  action.  Buyer and Seller  will  execute any  additional  instruments
necessary to consummate the transactions contemplated hereby.

         5.2. Public Announcements.

         Buyer and Seller will consult with each other before  issuing any press
release or otherwise  making any public statement with respect to this Agreement
and the  transactions  contemplated  herein,  and shall not issue any such press
release or make any such public  statement  prior to such  consultation or as to
which the other party reasonably objects, except as may be required by Law or by
obligations  pursuant  to any listing  agreement  with any  national  securities
exchange or inter-dealer quotation system.

         5.3. Confidentiality.

         Notwithstanding  the execution of this Agreement,  the  confidentiality
provisions  of the  Confidentiality  Agreement  shall  remain in full  force and
effect and shall survive the Closing.

         5.4. Taxes.

         Following Closing, Seller shall timely file all tax returns and reports
relating to the Assets which have not been filed or were not yet due to be filed
prior to Closing,  and Seller  shall  timely pay all taxes,  assessments,  fees,
interest,  penalties and  governmental  charges  relating to the Assets prior to
Closing  which  have not  been  paid or were  not yet due and  payable  prior to
Closing.

         5.5 Relocation of Facility.

         Buyer and Seller  agree that ETG will  relocate  the Facility to a site
mutually acceptable to Seller and Buyer and appropriate to the planned operation
of the Facility and the Paris  synthetic  fuel  manufacturing  facility  ("Paris
Facility").  The site  selected  will be prepared to host the  Facility  and the
Paris Facility.  Buyer will pay the costs of relocation and  installation of the
Facility  and the Paris  Facility up to $550,000  plus 10%.  Seller will pay the

                                       12
<PAGE>

costs of relocation and  installation  of the Facility and the Paris Facility in
excess of $550,000 plus 10%. Seller will provide oversight,  at its expense, for
relocation,   installation,  and  testing  to  place  the  Assets  in  operating
condition.

         Buyer will  consent to ETG's  grant to Seller of the right to  relocate
and operate the Paris Facility at the site selected for the Facility.

                                   ARTICLE VI
            CONDITIONS PRECEDENT TO THE PAYMENT OBLIGATIONS OF BUYER

         Each and every  obligation of Buyer to be performed on the Closing Date
shall  be  subject  to the  satisfaction,  prior  to or at the  Closing,  of the
following express conditions precedent:

         6.1. Compliance with Agreement.

         Seller shall have performed and complied in all material  respects with
all of its  obligations  under  this  Agreement  which  are to be  performed  or
complied with by it prior to or on the Closing Date.

         6.2. Proceedings and Instruments Satisfactory.

         All  proceedings,  corporate  or  other,  to  be  taken  by  Seller  in
connection  with  the  transactions  contemplated  by  this  Agreement,  and all
agreements,  instruments,  and other documents incident thereto,  including, but
not limited to, the Transaction Documents shall be executed and delivered by the
parties  thereto on the Closing Date and be reasonably  satisfactory in form and
substance to Buyer.

         6.3. No Litigation.

         No investigation, suit, action or other proceedings (including, without
limitation,  any petition  relating to the Seller under the  Bankruptcy  Code or
similar federal or state Law) shall be threatened or pending before any court or
governmental agency that seeks restraint,  prohibition,  damages or other relief
in  connection  with this  Agreement  or the  consummation  of the  transactions
contemplated hereby or in connection with obligations to creditors.

         6.4. Representations and Warranties.

         The  representations  and  warranties  made by Seller in this Agreement
shall be true and correct in all respects (as to representations  and warranties
qualified or limited by the term "Material Adverse Effect," the word "material,"
or phrases of like import),  and in all material respects (as to representations
and warranties not so qualified or limited) as of the Closing Date with the same
force and effect as though said  representations and warranties had been made on
the Closing Date.

         6.5. Consents.

         All Required Consents applicable to Seller shall have been obtained.

                                       13
<PAGE>

         6.6. Antitrust Filings.

         The Hart-Scott-Rodino  Act ("HSR Act") and the regulations  promulgated
thereunder  shall  have been  complied  with to the extent  applicable,  and all
waiting periods under the HSR Act shall have expired or been terminated.

         6.7 Material Adverse Change.

         The Facility shall not have been  materially and adversely  affected by
reason of any loss,  taking,  condemnation,  destruction,  or  physical  damage,
whether or not insured against.

                                   ARTICLE VII
                CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER

         Each and every obligation of Seller to be performed on the Closing Date
shall be subject to the satisfaction prior to or at the Closing of the following
express conditions precedent:

         7.1. Compliance with Agreement.

         Buyer shall have  performed and complied in all material  respects with
all of its  obligations  under  this  Agreement  which  are to be  performed  or
complied with by it prior to or on the Closing Date.

         7.2. Proceedings and Instruments Satisfactory.

         All proceedings, corporate or other, to be taken by Buyer in connection
with  the  transactions  contemplated  by this  Agreement,  and all  agreements,
instruments,  and other documents incident thereto,  including,  but not limited
to, the  Transaction  Documents  shall be executed and  delivered by the parties
thereto on the Closing Date and be reasonably satisfactory in form and substance
to Seller.

         7.3. No Litigation.

         No investigation,  suit, action or other proceeding shall be threatened
or  pending  before  any court or  governmental  agency  that  seeks  restraint,
prohibition,  damages or other relief in connection  with this  Agreement or the
consummation of the transactions contemplated hereby.

         7.4. Representations and Warranties.

         The  representations  and  warranties  made by Buyer in this  Agreement
shall be true and correct in all respects (as to representations  and warranties
qualified or limited by the term "Material Adverse Effect," the word "material,"
or phrases of like import),  and in all material respects (as to representations
and warranties not so qualified or limited) as of the Closing Date with the same
force and effect as though such  representations and warranties had been made on
the Closing Date.

                                       14
<PAGE>

         7.5. Required Consents.

         All Required Consents applicable to Buyer shall have been obtained.

         7.6. Antitrust Filings.

         The HSR Act and the regulations  promulgated thereunder shall have been
complied with to the extent  applicable,  and all waiting  periods under the HSR
Act shall have expired or been terminated.

                                  ARTICLE VIII
                      INDEMNITIES AND ADDITIONAL COVENANTS

         8.1. Seller's Indemnity.

                  (a) Seller hereby  indemnifies  and holds Buyer  harmless from
         and against,  and agrees to defend  promptly  Buyer from, and reimburse
         Buyer for, any and all losses, damages,  costs, expenses,  liabilities,
         obligations  and  claims of any kind,  including,  without  limitation,
         environmental   liabilities   (whether  involving  personal  injury  or
         property damage),  reasonable attorneys' fees and other legal costs and
         expenses (hereinafter referred to collectively as "Losses"), that Buyer
         and any  Affiliate of Buyer may at any time suffer or incur,  or become
         subject  to, as a result of or in  connection  with:  (i) any breach or
         inaccuracy of any of the  representations and warranties made by Seller
         in this  Agreement or any other  agreement or  instrument  delivered by
         Seller  pursuant  hereto;  (ii) any  failure  of Seller  to carry  out,
         perform,  satisfy  and  discharge  any  of its  covenants,  agreements,
         undertakings,  liabilities or obligations under this Agreement or under
         any of the agreements and  instruments  delivered by Seller pursuant to
         this Agreement;  (iii) claims by third parties (including  governmental
         authorities)  against Buyer  relating to the  ownership,  construction,
         operation and  maintenance by Seller of the Assets and Facility for the
         period prior to the Effective Time including,  without limitation,  any
         claim of landlord's  statutory  lien; and (iv) any and all  liabilities
         and obligations of Seller;

                  (b) In the event a claim arises that Buyer reasonably believes
         is  covered  by the  indemnity  provisions  of  Section  8.1(a) of this
         Agreement, notice shall be given promptly by Buyer to Seller containing
         detail  reasonably  sufficient  for Seller to  identify  the nature and
         basis of the claim.  Provided  that  Seller  admits in writing to Buyer
         that such  claim is  covered  by the  indemnity  provisions  of Section
         8.1(a) hereof, Seller shall have the right to contest and defend by all
         appropriate legal proceedings such claim and to control all settlements
         (unless Buyer agrees to assume the cost of settlement and to forgo such
         indemnity) and to select lead counsel to defend any and all such claims
         at the sole cost and expense of Seller; provided,  however, that Seller
         may not effect any settlement that could result in any cost, expense or
         liability to Buyer unless Buyer consents in writing to such  settlement
         and Seller agrees to indemnify Buyer therefor. Buyer may select counsel
         to  participate  with Seller's  counsel in any such  defense,  in which
         event  Buyer's  counsel  shall be at its own sole cost and expense.  In

                                       15
<PAGE>

         connection with any such claim, action or proceeding, the parties shall
         cooperate  with each  other  and  provide  each  other  with  access to
         relevant books and records in their possession.

                  (c)  Seller  shall  not be  required  to  indemnify  and  hold
         harmless Buyer pursuant to Section  8.1(a)(i)  hereof in respect of the
         representations  and warranties made by Seller herein unless such right
         to  indemnification  is asserted  by Buyer  (whether or not such Losses
         have actually been incurred) by notice to Seller within 30 months after
         the  Closing  Date;  or,  only with  respect  to claims  arising  under
         Sections 3.4, 3.11, within the applicable  statute of limitations;  or,
         only with respect to claims arising under Section 3.15,  until December
         31, 2007.

                  (d) Except with respect to claims  arising under  Sections 3.4
         or 3.11,  Seller's  aggregate  indemnification  obligation  pursuant to
         Section  8.1(a)(i)  shall in no event exceed the money actually paid by
         Buyer and received by Seller pursuant to Section 2.2.

                  (e)  The   indemnification   provided  in  this  Section  8.1,
         including the limitations with respect thereto,  shall be the exclusive
         remedy for Buyer with respect to Losses as a result of or in connection
         with the matters described in Section  8.1(a)(i),  notwithstanding  any
         provisions in this  Agreement or any other such agreement or instrument
         to the contrary.

         8.2. Buyer's Indemnity.

                  (a) Buyer hereby  indemnifies  and holds Seller  harmless from
         and against,  and agrees to defend  promptly  Seller from and reimburse
         Seller  for,  any and all Losses  that Seller may at any time suffer or
         incur, or become subject to, as a result of or in connection  with: (i)
         any breach or inaccuracy of any of the  representations  and warranties
         made by Buyer in this  Agreement or any other  agreement or  instrument
         delivered by Buyer pursuant hereto;  (ii) any failure by Buyer to carry
         out, perform,  satisfy and discharge any of its covenants,  agreements,
         undertakings,  liabilities or obligations under this Agreement or under
         any of the  agreements and  instruments  delivered by Buyer pursuant to
         this   Agreement;   and  (iii)  claims  by  third  parties   (including
         governmental  authorities)  against Seller relating to the ownership by
         Buyer of the Assets for the period  following  the  Effective  Time and
         prior to the conveyance to ETG.

                  (b) In the event a claim against Seller arises that is covered
         by the indemnity  provisions of Section 8.2 of this  Agreement,  notice
         shall be given promptly by Seller to Buyer containing detail reasonably
         sufficient  for Buyer to  identify  the  nature and basis of the claim.
         Provided  that Buyer  admits in  writing  to Seller  that such claim is
         covered by the indemnity  provisions of Section 8.2 hereof, Buyer shall
         have  the  right  to  contest  and  defend  by  all  appropriate  legal
         proceedings  such claim and to control all  settlements  (unless Seller
         agrees to assume the cost of  settlement  and to forgo such  indemnity)
         and to select  lead  counsel to defend  any and all such  claims at the
         sole cost and expense of Buyer;  provided,  however, that Buyer may not
         effect  any  settlement  that  could  result  in any cost,  expense  or
         liability  to  Seller  unless  Seller   consents  in  writing  to  such
         settlement and Buyer agrees to indemnify  Seller  therefor.  Seller may
         select counsel to participate with Buyer's counsel in any such defense,

                                       16
<PAGE>

         in which event Seller' counsel shall be at the sole cost and expense of
         Seller.  In connection with any such claim,  action or proceeding,  the
         parties  shall  cooperate  with each other and provide  each other with
         access to relevant books and records in their possession.

                  (c) Buyer shall not be required to indemnify and hold harmless
         Seller  pursuant  to  Section   8.2(a)(i)  hereof  in  respect  of  the
         representations  and warranties  made by Buyer herein unless such right
         to  indemnification  is asserted by Seller  (whether or not such Losses
         have  actually  been  incurred) by notice to the Buyer within 30 months
         after the Closing Date.

                  (d) Buyer's aggregate  indemnification  obligation pursuant to
         Section  8.2 (a)(i)  shall in no event  exceed  Five  Hundred  Thousand
         Dollars ($500,000.00).

                  (e)  The   indemnification   provided  in  this  Section  8.2,
         including the limitations with respect thereto,  shall be the exclusive
         remedy  for  Seller  with  respect  to  Losses  as a  result  of  or in
         connection   with  the   matters   described   in  Section   8.2(a)(i),
         notwithstanding  any  provisions  in this  Agreement  or any other such
         agreement or instrument to the contrary.

         8.3. Bulk Sales Compliance.

         To the extent applicable, Buyer hereby waives compliance by Seller with
the provisions of the bulk sales Law of any U.S. jurisdiction, and in any event,
Seller  covenants  and  agrees to pay and  discharge  when due all claims of any
governmental entities and creditors of Seller and its subsidiaries that could be
asserted  against  Buyer  by  reason  of such  non-compliance.  Seller  agree to
indemnify and hold Buyer harmless from and against and shall on demand reimburse
Buyer for any and all Losses suffered by Buyer by reason of Seller's  failure to
pay and discharge any such claims.

         8.4. Additional Instruments.

         At any time and from time to time after the Closing,  at either party's
request and without further consideration,  Seller or Buyer, as the case may be,
shall execute and deliver such other instruments of sale, transfer,  conveyance,
assignment  and  confirmation  and take such other action as Seller or Buyer may
reasonably  deem necessary or desirable in order to more  effectively  transfer,
convey,  and assign to Buyer,  and confirm  Buyer's title to and interest in and
responsibility  and  liability  for,  the  Assets  and the  consummation  of the
transactions contemplated herein.

         8.5. Access to Books, Records and Employees.

         From and after the date of the  Agreement,  Seller will  authorize  and
permit  Buyer and its  representatives  to have access  during  normal  business
hours, upon reasonable notice and for reasonable  purposes and in such manner as
will not unreasonably  interfere with the conduct of Seller's business, to Books
and Records within the control of Seller that relate to the Facility, and to all
books and records,  files,  documents  and other  correspondence  related to the
Facility prior to the Effective Time, which are not included among the Books and

                                       17
<PAGE>

Records.  Seller  agrees to maintain all books,  records,  files,  documents and
other  correspondence  related to the Facility  prior to the  Effective  Time in
accordance with its normal document retention practices after the Closing Date.

                                   ARTICLE IX
                                   TERMINATION

         9.1. Termination.

         This  Agreement may be  terminated  and the  transactions  contemplated
hereby may be abandoned as follows: (a) at any time prior to the Closing Date by
mutual written  agreement of Seller and Buyer;  or (b) by either Seller or Buyer
if the Effective  Time shall not have  occurred on or before  December 31, 2001;
provided,  however,  that the right to terminate this Agreement pursuant to this
clause (b) shall not be  available  to any party  whose  failure to fulfill  any
obligation  under  this  Agreement  has been the cause of, or  resulted  in, the
failure of the Effective Time to occur prior to such date.

         9.2. Rights on Termination; Waiver.

                  (a) If this  Agreement is terminated  pursuant to Section 9.1,
         all  further  obligations  of the  parties  under or  pursuant  to this
         Agreement shall be terminated.

                  (b) If any of the  conditions  set forth in Article VI of this
         Agreement  have not been  satisfied,  Buyer may  nevertheless  elect to
         waive  such  conditions  and  proceed  with  the  consummation  of  the
         transactions contemplated hereby. If any of the conditions set forth in
         Article  VII of this  Agreement  have not been  satisfied,  Seller  may
         nevertheless  elect to  waive  such  conditions  and  proceed  with the
         consummation of the transactions  contemplated  hereby. The election by
         Buyer or Seller to terminate this Agreement pursuant to Section 9.1 (b)
         shall not in any way affect the rights of such party  against the other
         party for any breach or default under this Agreement.

                                    ARTICLE X
                                  MISCELLANEOUS

         10.1. Entire Agreement; Amendment.

         This Agreement and the documents referred to herein and to be delivered
pursuant hereto constitute the entire agreement  between the parties  pertaining
to the  subject  matter  hereof,  and  supersede  all prior and  contemporaneous
agreements, understandings, negotiations and discussions of the parties, whether
oral  or  written,  and  there  are  no  warranties,  representations  or  other
agreements  between the parties in connection  with the subject  matter  hereof,
except as specifically  set forth herein or therein.  No amendment,  supplement,
modification,  waiver or termination  of this Agreement  shall be binding unless
executed  in writing by the party to be bound  thereby.  No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any
other provision of this Agreement, whether or not similar, nor shall such waiver
constitute  a  continuing  waiver  unless  otherwise  expressly  provided.   The
representations  and  warranties  of each  party  hereto  shall be  deemed to be

                                       18
<PAGE>

material and to have been relied upon by the other party.  The  representations,
warranties,  covenants and agreements of Seller and Buyer contained herein shall
survive the execution and delivery of this  Agreement  and  consummation  of the
transactions  contemplated hereby and, as to the representations and warranties,
shall be effective  until the relevant time  limitation for making any indemnity
claim with respect to such representations and warranties under Sections 8.1 and
8.2 shall have been reached and no longer.

         10.2. Expenses.

         Except as otherwise  specifically  provided herein, each of the parties
hereto shall pay the fees and expenses of their respective counsel,  accountants
and other  experts  and the  other  expenses  incident  to the  negotiation  and
preparation of this Agreement and consummation of the transactions  contemplated
hereby.

         10.3. Governing Law; Consent to Jurisdiction.

         This Agreement shall be construed and interpreted according to the laws
of the State of Utah,  without  regard to the  conflicts  of law rules  thereof.
Either party hereto may make service on the other party by sending or delivering
a copy of the process to the party to be served at the address and in the manner
provided for the giving of notices in Section 10.5 hereof.

         10.4. Assignment.

         This Agreement and each party's  respective rights hereunder may not be
assigned, by operation of Law or otherwise, without the prior written consent of
the other party;  provided that Buyer may assign all of its rights under Section
8.1 to ETG in connection with the conveyance of Buyer's interest in the Assets.

         10.5. Notices.

         All  communications,  notices and disclosures  required or permitted by
this Agreement shall be in writing and shall be deemed to have been given at the
earlier  of the  date  (a)  when  delivered  personally  or by  messenger  or by
overnight delivery service to an officer of the other party, (b) five days after
being mailed by registered or certified  United  States mail,  postage  prepaid,
return  receipt  requested,  or (c) when received via  telecopy,  telex or other
electronic  transmission,  in all cases  addressed  to the person for whom it is
intended  at his  address  set forth  below or to such other  address as a party
shall have  designated  by notice in  writing  to the other  party in the manner
provided by this Section:

If to Seller:                    Headwaters Incorporated
                                 11778 South Election Road, Suite 210
                                 Draper, UT  84020
                                 Fax:  (801) 984-9410
                                 Attn:  President

                                       19
<PAGE>

If to Buyer:                     Red Hawk Energy, LLC
                                 10000 Stockdale Highway, Suite 100
                                 Bakersfield, CA  93311
                                 Fax: 661/663-3164
                                 Attn:  Michael L. Hawkins

         10.6. Counterparts; Headings.

         This Agreement may be executed in several  counterparts,  each of which
shall be deemed an original, but such counterparts shall together constitute but
one and the same  Agreement.  The Table of  Contents  and  Article  and  Section
headings in this  Agreement are inserted for  convenience  of reference only and
shall not constitute a part hereof.

         10.7. Interpretation.

         Unless the context requires otherwise, all words used in this Agreement
in the singular number shall extend to and include the plural,  all words in the
plural  number  shall  extend to and include the  singular  and all words in any
gender shall extend to and include all genders.  All  references  to  contracts,
agreements,  leases or other  understandings or arrangements shall refer to oral
as well as written matters.  The specificity of any  representation  or warranty
contained  herein  shall  not be deemed  to limit  the  generality  of any other
representation or warranty contained herein.

         10.8. Severability.

         If any provision,  clause or part of this Agreement, or the application
thereof under  certain  circumstances,  is held  invalid,  the remainder of this
Agreement,  or the  application  of such  provision,  clause or part under other
circumstances, shall not be affected thereby.

         10.9. No Reliance.

         No  third  party  is  entitled  to rely on any of the  representations,
warranties and agreements  contained in this Agreement.  Buyer and Seller assume
no liability to any third party because of any reliance on the  representations,
warranties  and  agreements  of Buyer or  Seller  contained  in this  Agreement.
Nothing contained in this Agreement shall be construed as creating a partnership
or joint venture or any agency  relationship  between the parties hereto, or any
other relationship other than buyer and seller as provided herein.

         10.10. Parties in Interest.

         This Agreement shall be binding upon and inure solely to the benefit of
each party  hereto,  and  nothing in this  Agreement,  express  or  implied,  is
intended  to or shall  confer  upon any other  person any  rights,  benefits  or
remedies of any nature whatsoever under or by reason of this Agreement.

                                       20
<PAGE>

         10.11. Specific Performance.

         The parties  hereto  agree that  irreparable  damage would occur in the
event any of the  provisions of this  Agreement were not performed in accordance
with the  terms  hereof  and that the  parties  shall be  entitled  to  specific
performance  of the terms  hereof,  in  addition  to any other  remedy at Law or
equity.

               [Remainder of this page intentionally left blank.]

                                       21
<PAGE>

         IN  WITNESS  WHEREOF,  each  party  hereto  has  caused  this  Purchase
Agreement to be executed in its name by a duly authorized  officer as of the day
and year first above written.

                                                     HEADWATERS INCORPORATED

                                                     By: /s/ Brent M. Cook
                                                        ------------------------
                                                     Its:  President

                                                     RED HAWK ENERGY, LLC

                                                     By: /s/ Michael L. Hawkins
                                                        ------------------------
                                                     Its: Managing Member

                                       22Exhibit 10.74.1

                              AMENDED AND RESTATED

                 TECHNOLOGY LICENSE AND REAGENT SUPPLY AGREEMENT

         THIS  AMENDED  AND  RESTATED  TECHNOLOGY  LICENSE  AND  REAGENT  SUPPLY
AGREEMENT  (the  "Agreement"),  is made and entered into as of March 26, 2002 by
and between  Environmental  Technologies  Group,  LLC, a Utah limited  liability
company (the "Licensee"),  and Headwaters  Incorporated,  a Delaware corporation
(the "Licensor").

         WHEREAS  Licensor  has  developed  a  proprietary  process  to  produce
synthetic fuel from coal, and Licensor is entitled to license the Synthetic Fuel
Technology (as defined below) to Licensee;

         WHEREAS  Licensee  owns  a  synthetic  fuel  manufacturing  plant  (the
"Facility");

         WHEREAS  Licensee  wishes to  obtain  and  Licensor  wishes to grant to
Licensee a license for the  Synthetic  Fuel  Technology to be used in connection
with the Facility on the terms and conditions set forth in this  Agreement,  and
Licensee  wishes  to  obtain  and  Licensor  wishes  to  sell  to  Licensee  the
Proprietary Reagent (as defined below) for use in the operation of the Facility;

         WHEREAS  Licensor  and Licensee  entered into a Technology  License and
Reagent  Supply  Agreement as of December 28, 2001 and wish to amend and restate
their agreement as set forth herein;

         NOW, THEREFORE,  in consideration of the foregoing premises, the mutual
covenants  and  agreements  hereinafter  set forth,  and other good and valuable
consideration,  the receipt  and  sufficiency  of which is hereby  acknowledged,
Licensor and Licensee each agree as follows:

         Section 1.  Definitions.

         "Coal  Feedstock" means Licensee's coal to be processed at the Facility
into synthetic fuel.

          "Code" means the Internal Revenue Code of 1986, as amended.

         "Developed   Technology"   means  any  inventions,   "Improvement,"  or
technology that Licensor may conceive,  make,  invent,  or suggest in connection
with Licensor's disclosure to Licensee of the Synthetic Fuel Technology,  all of
which  the  parties  hereto  acknowledge  and  agree  constitutes  the  sole and
exclusive   property  of  Licensor.   "Developed   Technology"  also  means  any
inventions,  "Improvement," or new technology  directly related to the Synthetic
Fuel Technology that Licensor or Licensee may conceive,  make, invent or suggest
relating to the Synthetic Fuel Technology during the Term of this Agreement.

         "Effective Date" means the date of this Agreement set forth above.

         "Facility" has the meaning set forth in the preamble.

<PAGE>

         "Improvement"  means an  alteration  or  addition  to an  invention  or
discovery  which may  enhance  performance  or  economics  while  maintaining  a
product's,   device's,   or  method's  essential  identity  and  character.   An
"Improvement"  may  comprise  alterations  or  additions  to either  patented or
unpatented inventions,  discoveries,  technology, or devices, and may or may not
be patentable.

         "Licensee" has the meaning set forth in the preamble.

         "Licensor" has the meaning set forth in the preamble.

         "Proprietary   Reagent"  means  and  refers  to  the  chemical  reagent
compounds that are part of Licensor's  Synthetic Fuel Technology,  necessary for
the production, by Licensee, of synthetic fuel reasonably expected to constitute
"qualified  fuels" pursuant to the terms of Section  29(c)(1)(C) of the Code and
with respect to which  Section 29 is  applicable  pursuant to Section  29(f) and
29(g) of the Code.

          "Synthetic Fuel Technology" means all intellectual  property,  patents
(including,  but  not  limited  to,  United  States  Patent  Numbers  5,599,361;
5,487,764 and  5,453,103)  and  applications  therefor,  printed and not printed
technical data, know-how, trade secrets,  proprietary chemicals,  copyrights and
other intellectual property rights, inventions, discoveries,  techniques, works,
processes,   methods,   plans,   software,   designs,   drawings,    schematics,
specifications,   communications   protocols,   source  and   object   code  and
modifications,  test procedures, program cards, tapes, disks, algorithms and all
other scientific or technical  information in whatever form including "Developed
Technology" and  "Improvements"  relating to, embodied in or used in the process
to produce  synthetic  fuel from coal,  waste coal,  coal fines,  and other coal
derivatives,  including all such information in existence as of the date of this
Agreement as well as related information later developed by Licensor;  provided,
however, that the defined term "Synthetic Fuel Technology" shall not include the
proprietary  process/method or other binder material or composition developed by
Licensor to produce  synthetic  coke  briquettes  from coke breeze,  iron revert
materials,  or any technology used in any application  other than the processing
and production of solid synthetic fuel made from coal. Nothing in this Agreement
is  intended  to grant  to  Licensee  the  right to  apply  the  Synthetic  Fuel
Technology  to produce  anything  other than solid  synthetic  fuel  intended to
qualify for tax credits under Section 29(c)(1)(C) of the Code.

         Section 2. License Grant.

         2.1 General. Licensor hereby grants to Licensee a non-exclusive license
to use the Synthetic Fuel  Technology,  including  Developed  Technology  and/or
Improvements  relating to the Synthetic Fuel Technology,  throughout the term of
this  Agreement,  for the  purpose of  commercial  exploitation,  including  the
non-exclusive  right to make,  have made or use at the  Facility and to offer to
sell and to sell or otherwise transfer products that have been manufactured with
the  Synthetic  Fuel  Technology,  subject to the terms and  conditions  of this
Agreement.  Licensee  shall not have the right to sublicense  the Synthetic Fuel
Technology  other than to an operator  employed at the  Facility by Licensee for
operations solely at the Facility.

         2.2  Licensor's  Ownership  of  Developed  Technology.   All  Developed
Technology  and/or   Improvements  are  and  shall  become  Licensor's  absolute

                                       2
<PAGE>

property,  subject to the terms of this  Agreement.  Licensee  shall at any time
during the term of this  Agreement  and  thereafter,  at  Licensor's  reasonable
request,  execute any patent papers  covering such Developed  Technology  and/or
Improvements  as  well as any  other  documents  that  Licensor  may  reasonably
consider  necessary or helpful in the prosecution of  applications  for a patent
thereon or in connection  with any  litigation or controversy  related  thereto;
provided,  however,  that all expenses  incident to the  preparation,  review or
filing of such applications and the prosecution  thereof and the conduct of such
litigation shall be borne by Licensor.

         2.3  Exclusive  Technology.  For  the  production  of  synthetic  fuel,
Licensee  agrees to use only the Synthetic  Fuel  Technology at the Facility and
not to use any other substitute  technology at the Facility.  Licensee shall not
use any  process or  methodology  in the  production  of  synthetic  fuel at the
Facility that is not part of the Synthetic Fuel  Technology  except as expressly
set forth in this  Agreement.  Licensee (a) shall not make or have made products
using the Synthetic Fuel Technology or similar technology except at the Facility
and (b)  shall  only  make and have  made  products  using  the  Synthetic  Fuel
Technology at the Facility under this License Agreement. Licensee further agrees
to use the  Synthetic  Fuel  Technology  only under  authority  of this  License
Agreement with Licensor.

         2.4  Non-licensed  Technology.  Licensor  retains the absolute right to
fully exploit its technologies including, but not limited to, the application of
such technology embodied in the Synthetic Fuel Technology to produce, market and
use synthetic coke briquettes from coke breeze,  iron revert materials,  and any
other materials to which Licensor's technology can be applied.

         2.5 Confidentiality.  Each of the parties hereby agrees to maintain the
Synthetic Fuel  Technology  confidential  and not to disclose the Synthetic Fuel
Technology,  or any  aspect  thereof,  including  the  Developed  Technology  or
Improvements   (collectively,   the  "Confidential   Technology   Information");
provided,  that Licensee acknowledges and agrees that nothing herein shall limit
Licensor  from  disclosing  Confidential  Technology  Information  to  other  of
Licensor's licensees. Notwithstanding the foregoing, information which (a) is or
becomes  generally  available  to  the  public  other  than  as a  result  of an
unauthorized  disclosure by the parties or their respective  agents,  employees,
directors  or  representatives,   (b)  was  available  to  the  party  receiving
disclosure  on a  non-confidential  basis  prior  to  its  receiving  disclosure
hereunder, (c) lawfully becomes available to the party receiving disclosure on a
non-confidential  basis from a third party source  (provided that such source is
not known by the party receiving disclosure or its agents, employees,  directors
or representatives to be prohibited from transmitting the information), or (d) a
party is compelled by legal process by any court or other  authority to disclose
shall not be subject to the terms of this Section 2.5. In the case of (d) above,
the  compelled  party shall give the other party prompt  written  notice of such
legal process in order that an appropriate protective order can be sought at the
other  party's  sole cost and  expense  and each party  agrees not to oppose the
other  party's  efforts to prevent the  disclosure  of  Confidential  Technology
Information.   At  the  termination  of  this  Agreement,   all  copies  of  any
Confidential Technology Information (including,  without limitation, any reports
or memoranda) shall be returned by the party receiving disclosure.

         2.6 Know-How and  Assistance.  To enable Licensee to benefit fully from
the license of the Synthetic Fuel Technology, Licensor shall provide to Licensee

                                       3
<PAGE>

access to all relevant documentation,  drawings,  engineering specifications and
other know-how in its possession,  reasonable  access to its employees or agents
who are familiar with the Synthetic Fuel Technology,  Developed Technology,  and
Improvements  and shall  provide such  technical  assistance  and training as is
requested by Licensee.  Licensee shall reimburse  Licensor for reasonable travel
and other  similar  out-of-pocket  expenses of Licensor in  performing  services
under this Section 2.6; provided  however,  that Licensor shall obtain the prior
approval of Licensee for any expenditures in excess of $5,000.

         Section  3.  Royalty  Payments.  During  the  term of  this  Agreement,
Licensee  shall pay to Licensor a royalty in an amount equal to $4.75 per ton of
synthetic fuel produced at the Facility (regardless of the ownership or location
thereof) and sold during the period  commencing on the Effective Date hereof and
ending  upon  the  expiration  of the  term  (or  earlier  termination)  of this
Agreement.  Such  royalty  shall be paid  quarterly  on the 20th day of January,
April,  July and  October of each year for the  synthetic  fuel sold  during the
immediately preceding calendar quarter, regardless of whether the Synthetic Fuel
Technology is used.

         Section 4. Sales of Proprietary Reagent.

         4.1 Sale and  Purchase.  During  the term of this  Agreement,  Licensee
shall purchase from Licensor the Facility's full  requirement of reagent for use
in the  manufacture  of  synthetic  fuel  at  the  Facility  (regardless  of the
ownership or location thereof), and Licensor shall supply Proprietary Reagent to
Licensee,  on the  terms  specified  herein.  Payment  for  Proprietary  Reagent
delivered  by  Licensor  during any  calendar  month shall be billed by Licensor
monthly at the end of each month and due and payable by Licensee by the 10th day
of the following  month.  Payments  after the  applicable due dates shall accrue
interest at the rate of one percent per month.

         4.2  Substitute  Reagent.  Licensor  agrees  that upon 20 days  written
notice to Licensor,  Licensee may purchase reagent from an alternative  supplier
if Licensor cannot supply  Licensee's  requirements for reagent as called for in
Section  4.1. If at any time  Licensor  provides 20 days  written  notice of its
intention  to cure its  performance  under  Section  4.1 and  provides  Licensee
reasonably  adequate  assurance  of its  ability  to  perform,  then  Licensee's
obligation  to  purchase  reagent  from  Licensor  under  Section  4.1  shall be
reinstated.

         4.3  Conditional  Sale.  Licensee  acknowledges  and  agrees  that  the
Proprietary  Reagent is the subject of  Licensor's  patents,  including  but not
limited to United States Patents No. 5,453,103,  5,487,764,  and 5,599,361,  and
that Licensee shall purchase  Proprietary  Reagent from Licensor  solely for its
own internal  needs in connection  with the  production by Licensee of synthetic
fuel and not for  resale.  Further,  Licensee  shall not  produce  or attempt to
produce, directly or indirectly, Proprietary Reagent.

         4.4 Price.  The price  which  Licensee  shall pay to  Licensor  for the
Proprietary Reagent shall be $1.275 per dry pound of Covol 298 or $1.475 per dry
pound of Covol  298-1.  The  Proprietary  Reagent  price  shall be subject to an
inflation  adjustment  of four  percent  beginning  January 1, 2003 and annually
thereafter;  provided,  however,  that at no time will  Licensor  be required to
supply  Proprietary  Reagent to Licensee at less than  Licensor's cost of supply
including reasonable overhead, plus a 10 percent profit.

                                       4
<PAGE>

         4.5  Licensor  Representations  and  Warranties.  Licensor  represents,
warrants and covenants as follows:

                  (a)  Licensor  shall  convey  to  Licensee  good  title to all
Proprietary Reagent and purchased by Licensee from Licensor hereunder,  free and
clear of any and all liens, claims and encumbrances of any type whatsoever.

                  (b) The  Proprietary  Reagent shall be delivered in accordance
with applicable laws and governmental regulations.

         4.6 Order  Procedure.  Licensee  shall deliver all purchase  orders for
Proprietary  Reagent at least ten (10) days in advance of the requested delivery
date.  Each  such  purchase  order  shall be  delivered  either  (a) in  writing
(including  by fax),  or (b)  orally  by  telephone  by an  authorized  agent of
Licensee  (subject to the  condition  that it is followed by a written  purchase
order within 24 hours).  Such purchase  orders shall be sent to Licensor at such
address as Licensor shall direct.

         4.7  Delivery  and  Acceptance.   All  Proprietary   Reagent  purchased
hereunder shall be delivered F.O.B. trucks at the Facility.  Licensee shall bear
the expense of unloading the Proprietary Reagent from the trucks. Licensee shall
have a reasonable  opportunity  to sample  Proprietary  Reagent  delivered to it
hereunder   to  confirm   that  such   Proprietary   Reagent   conforms  to  the
specifications attached hereto as Exhibit A-1 and A-2, and Licensee shall not be
deemed  or  required  to  accept  any  such  Proprietary  Reagent  prior  to the
completion of such sampling; provided, however, that Licensee shall be deemed to
have  accepted  any  Proprietary  Reagent  supplied  to it  hereunder,  if  such
Proprietary  Reagent is not rejected by Licensee in writing within five (5) days
of delivery to Licensee.

         Section 5.  Records;  Inspection;  Confidentiality.  Each party  hereto
shall keep accurate  records  containing  all data  reasonably  required for the
computation,  reporting,  and  verification  of the  amounts  to be  paid by the
respective parties under this Agreement, and shall permit each other party or an
independent  accounting  firm  designated by such other party to inspect  and/or
audit such records during normal business hours upon reasonable  advance notice.
All costs and expenses  incurred by a party in connection  with such  inspection
shall be borne by it.  Each  party  agrees to hold  confidential  from all third
parties  all  information  contained  in records  examined by or on behalf of it
pursuant to this Section 5 (collectively,  "Confidential Project  Information");
provided,  however, that information which (a) is or becomes generally available
to the  public  other  than as a result  of an  unauthorized  disclosure  by the
parties or their respective agents, employees, directors or representatives, (b)
was  available to the party  receiving  disclosure on a  non-confidential  basis
prior to its receiving disclosure  hereunder,  (c) lawfully becomes available to
the party receiving  disclosure on a  non-confidential  basis from a third party
source (provided that such source is not known by the party receiving disclosure
or its agents,  employees,  directors or  representatives  to be prohibited from
transmitting the  information),  or (d) a party is compelled by legal process by
any court or other  authority  to disclose  shall not be subject to the terms of
this  Section 5. In the case of (d) above,  the  compelled  party shall give the
other  party  prompt  written  notice of such  legal  process  in order  that an
appropriate  protective  order can be sought at the other  party's sole cost and

                                       5
<PAGE>

expense and each party agrees not to oppose the other party's efforts to prevent
the disclosure of Confidential Project  Information.  At the termination of this
Agreement,  all  copies  of any  Confidential  Project  Information  (including,
without  limitation,  any reports or  memoranda)  shall be returned by the party
receiving disclosure.

         Section 6. Enforcement of Proprietary Rights.  Licensee shall cooperate
in good faith,  at no cost or expense to Licensee,  with  Licensor's  efforts to
enforce its proprietary patent and trade secret rights.

         Section 7. General Representations and Warranties.

         7.1  Authority.  Each of Licensee and Licensor  represents and warrants
that (a) the  execution,  delivery and  performance  of this  Agreement  and the
consummation of the transactions  contemplated  hereby have been duly authorized
on its behalf by all requisite  action,  corporate or otherwise,  (b) it has the
full right,  power and  authority to enter into this  Agreement and to carry out
the  terms  of this  Agreement,  (c) it has duly  executed  and  delivered  this
Agreement,  and (d) this  Agreement  is a valid  and  binding  obligation  of it
enforceable  in  accordance  with its terms,  except as  limited  by  applicable
bankruptcy, insolvency, reorganization or similar laws at the time in effect.

         7.2 No Consent.  Each of Licensee and Licensor  represents and warrants
that no approval, consent,  authorization,  order, designation or declaration of
any court or regulatory  authority or  governmental  body or any  third-party is
required to be obtained by it, nor is any filing or registration  required to be
made therewith by it for the consummation by it of the transactions contemplated
under this Agreement.

         7.3 Intellectual Property Matters. Licensor represents and warrants (a)
to its best knowledge and good faith belief that it owns,  free and clear of all
liens  and  encumbrances,  patents  related  to the  Synthetic  Fuel  Technology
(including,  but  not  limited  to,  United  States  Patent  Numbers  5,599,361,
5,487,764  and  5,453,103)  and has developed  the  Synthetic  Fuel  Technology,
including, but not limited to, printed and not printed technical data, know-how,
trade  secrets,  proprietary  chemicals,   copyrights,  and  other  intellectual
property  rights and all other  scientific or technical  information in whatever
form relating to,  embodied in or used in the process to produce  synthetic fuel
from coal, waste coal, coal fines, and other similar coal derivatives,  and, the
right  to  freely  make,  use,  sell and  exploit  Proprietary  Reagent  used in
manufacturing synthetic fuel from coal, waste coal, coal fines and other similar
coal  derivatives,  and (b) that it has the right and power to grant to Licensee
the licenses granted herein.

         7.4 Indemnification.  Each party agrees to indemnify,  defend,  protect
and hold  harmless  the  other  party  and its  partners,  directors,  officers,
members, agents,  representatives,  subsidiaries and affiliates from and against
any and all claims,  demands or suits (by any party,  including any governmental
entity), losses, liabilities, damages, obligations, payments, costs and expenses
(including  the  costs  and  expenses  of  enforcing  this  indemnification  and
defending  any and all actions,  suits,  proceedings,  demands and  assessments,
which shall include reasonable  attorneys' fees and court costs) resulting from,
relating to, arising out of, or incurred in connection with any breach of any of
the representations, warranties and/or covenants contained in this Agreement.

                                       6
<PAGE>

         Section  8.  Term.  The  term  of  this  Agreement  is for  the  period
commencing on the  Effective  Date of this  Agreement and will continue  (unless
terminated  according  to the  terms and  conditions  of this  Agreement)  until
December 31, 2007, or such earlier date on which  synthetic fuel produced at the
Facility shall cease to constitute  "qualified  fuels" with respect to which the
Licensee  shall be entitled  to claim  federal  income tax  credits  pursuant to
Section 29 of the Code.  Upon at least 6 month's  written notice before December
31, 2007 by either party,  this  Agreement  shall be extended until December 31,
2015,  or such earlier  date on which  synthetic  fuel  produced at the Facility
shall cease to constitute  "qualified  fuels" with respect to which the Licensee
shall be entitled to claim federal income tax credits  pursuant to Section 29 of
the Code.  Anything in this  Agreement  notwithstanding,  this  Agreement  shall
remain in full force and effect for so long as the Facility  produces  synthetic
fuel.

         Section  9.  Termination.  This  Agreement  shall  terminate  upon  the
termination  date set forth in Section 8,  unless the  Agreement  is  terminated
sooner pursuant to this Section 9.

         9.1  Termination  for Cause. In addition to any other remedies that may
exist,  either party may  terminate  this  Agreement  for cause in the event the
other party  commits a material  breach of any  provision  of this  Agreement by
giving the other  party at least  sixty (60) days prior  written  notice of such
termination  in the case of a breach other than for the payment of money,  or in
the case of a breach for a failure to pay, fifteen (15) days notice, unless such
default  or  breach  is cured  within  said  sixty  (60) or  fifteen  (15)  days
respectively. If either party terminates this Agreement pursuant to this Section
9, each party  shall  promptly  return  and cause all of its agents to  promptly
return  to  the  other  party  Confidential   Technology   Information  and  all
Confidential  Project  Information   (together,   "Confidential   Information"),
including with respect to Licensee,  all Synthetic Fuel  Technology  then in its
possession,  and such  party  shall not  thereafter  use for its own  commercial
benefit or disclose to any third person any  Confidential  Information or during
the period  ending three (3) years from the date of such  termination;  provided
however that Licensee may terminate  this Agreement as set forth in this Section
9.1  while  continuing  to use  the  Synthetic  Fuel  Technology  for so long as
Licensee  continues to pay Licensor  royalty payments as set forth in Section 3.
Notwithstanding  the foregoing,  information  which (a) is or becomes  generally
available to the public other than as a result of an unauthorized  disclosure by
the receiving party or its respective members, agents,  employees,  directors or
representatives,  (b) was available to the Licensee on a non-confidential  basis
prior to its receiving disclosure  hereunder,  (c) lawfully becomes available to
the  receiving  party on a  non-confidential  basis  from a third  party  source
(provided  that such source is not known by the receiving  party or its members,
agents,   employees,   directors  or   representatives  to  be  prohibited  from
transmitting the information),  or (d) the receiving party is compelled by legal
process by any court or other  authority to disclose shall not be subject to the
terms of the duty to protect Confidential Information set forth in this section.
In the case of (d) above,  the receiving party shall give the other party prompt
written  notice of such legal  process in order that an  appropriate  protective
order can be sought at the other  party's sole expense and the  receiving  party
agrees  not to  oppose  such  party's  efforts  to  prevent  the  disclosure  of
Confidential Information.

         9.2 Termination for Insolvency or Ceasing Business.  This Agreement may
be terminated by either party if:

                                       7
<PAGE>

                  (a) The other party becomes  insolvent or is unable to pay its
debts as they fall due, seeks protection  voluntarily or involuntarily under any
law   relating  to   bankruptcy,   receivership,   insolvency,   administration,
liquidation,  dissolution or similar law of any jurisdiction (other than for the
purposes of a  reorganization  with a view to continuing the business as a going
concern under relevant  bankruptcy or insolvency  proceedings)  or enters into a
general  assignment or arrangement  or a composition  with or for the benefit of
its creditors; or

                  (b) The other  party takes any step  (including  the filing or
presentation  of a petition,  or the filing of an application or consent) in any
jurisdiction  for,  or with a view  to,  the  appointment  of an  administrator,
liquidator, receiver, trustee, custodian or similar official (other than for the
purposes of a  reorganization  with a view to continuing the business as a going
concern under  relevant  bankruptcy or  insolvency  proceedings)  for such party
and/or the whole or any part of the business, undertaking,  property, assets, or
uncalled capital of such party or any such person is appointed.

         9.3 Effect of  Termination.  Upon  termination of this  Agreement,  all
rights granted to and future  obligations of the parties shall immediately cease
except as provided above;  however termination shall not relieve either party of
its  obligations  accrued  during  the  term of this  Agreement  (including  any
pre-termination obligation Licensee may have to pay Licensor) which has not been
fulfilled, and all representations,  warranties, indemnification obligations and
confidentiality  agreements  made  herein  shall  survive  termination  of  this
Agreement.

         Section 10. Waiver. The failure of any party to enforce at any time any
provision of this Agreement shall not be construed as a waiver of such provision
or the right  thereafter to enforce each and every  provision.  No waiver by any
party, either express or implied, of any breach of any of the provisions of this
Agreement  shall be  construed  as a waiver of any other  breach of such term or
condition.

         Section 11.  Severability.  If any provision of this Agreement shall be
held by a court of competent  jurisdiction to be invalid or unenforceable in any
respect for any reason, the validity and enforceability of any such provision in
any other respect and of the remaining provisions of this Agreement shall not be
in any way impaired.

         Section  12.  Notices.  All  notices  required  or  authorized  by this
Agreement shall be effective upon receipt and given to the parties in writing by
fax, mail, or courier as follows:

         To Licensor:          President
                               Headwaters Incorporated
                               11778 S. Election Road, Suite 210
                               Draper, UT 84020
                               Fax:  (801) 984-9410

         To Licensee:          Environmental Technologies Group, LLC
                               11778 S. Election Road, Suite 210
                               Draper, UT 84020
                               Fax:   (801) 984-9420
                               Attn:  Manager

                                       8
<PAGE>

         With a copy to:       Red Hawk Energy, LLC
                               10,000 Stockdale Highway, Suite 100
                               Bakersfield, CA  93311
                               Fax:  (661) 663-3164
                               Attn:  President

         Section 13. Remedies Cumulative. Remedies provided under this Agreement
shall be  cumulative  and in  addition to other  remedies  provided by law or in
equity.

         Section 14. Entire  Agreement.  This Agreement  constitutes  the entire
agreement of the parties  relating to the subject  matter  hereof.  There are no
promises,  terms,  conditions,  obligations,  or  warranties  other  than  those
contained herein.  This Agreement  supersedes any and all prior  communications,
representations,  or agreements, verbal or written, between the parties relating
to the  subject  matter  hereof.  This  Agreement  may not be amended  except in
writing signed by the parties hereto.

         Section  15.  Governing  Law.  This  Agreement  shall  be  governed  in
accordance with the laws of the State of Utah, exclusive of its conflict of laws
rules.

         Section 16. Assignment.

                  (a) Except as set forth in this Section 16, this Agreement may
not be assigned,  in whole or in part, by any party without the written  consent
of the other party, which consent shall not be unreasonably withheld or delayed.
Licensor and Licensee shall have the right to assign their respective rights and
obligations  under this  Agreement to any entity which is controlled by Licensor
or Licensee,  as the case may be, and of which Licensor or Licensee, as the case
may be, owns, directly or indirectly, at least fifty percent (50%) of each class
of its outstanding  securities,  provided that no such assignment  shall release
Licensor  or  Licensee,  as the case may be, from their  respective  obligations
hereunder.

                  (b)  Licensee  covenants  not  to  transfer  ownership  of the
Facility  except on condition  that the  Licensee,  as a part of such  transfer,
assigns  its  obligations   under  this  Agreement  to  a  person  (a  "Facility
Assignment"),  subject to Licensor's written consent, which consent shall not be
unreasonably withheld or delayed. No such attempted assignment by Licensee shall
be valid  unless the  putative  transferee  shall have agreed  unqualifiedly  to
assume the obligations of Licensee under this Agreement.

                                       9
<PAGE>

         Executed by the duly  authorized  representative  of the parties on the
date and year first above written.

HEADWATERS INCORPORATED

By: /s/ Brent M. Cook
    -----------------------------
     Name: Brent M. Cook
     Its:  President

ENVIRONMENTAL TECHNOLOGIES GROUP, LLC

By: /s/ Brent M. Cook
    ---------------------------------------------------
     Name: Brent M. Cook
     Its:  President, Headwaters Incorporated, Manager

                                       10
<PAGE>

                                   Exhibit A-1

                Specifications of Proprietary Reagent - Covol 298

         I.       MATERIAL DESCRIPTION:

         Color:                               White
         Odor:                                Slight odor
         Appearance/Physical State            Liquid with suspended solids
         Description Note:                    Proprietary Carboxylated
                                               Styrene/Butadiene Polymer

         II.      GOVERNMENT INDUSTRY STANDARDS:

                  Non-food Contact

         III.     TEST REQUIREMENTS:

--------------------------------- ------------- -------------- -----------------
Test Item and Condition             Limit            Unit           Method
--------------------------------- ------------- -------------- -----------------
Solids                              48.0-50.0        Wt%            DOWM 100008
PH                                  5.5-6.5                         DOWM 100429
2000 Mesh Residue, per 900 ml       0.05 Max         Grams          LTM 004
--------------------------------- ------------- -------------- -----------------

                                       11
<PAGE>

                                   Exhibit A-2

              Specifications of Proprietary Reagent - Covol 298-1

         I.       MATERIAL DESCRIPTION:

         Color:                               White
         Odor:                                Slight odor
         Appearance/Physical State            Liquid with suspended solids
         Description Note:                    Proprietary Carboxylated
                                              Styrene/Butadiene/Acrylate/Acetate
                                              Polymer

         II.      GOVERNMENT INDUSTRY STANDARDS:

                  Non-food Contact

         III.     TEST REQUIREMENTS:

--------------------------------- ----------------- ------------ ---------------
Test Item and Condition               Limit              Unit       Method
--------------------------------- ----------------- ------------ ---------------
Solids                                51.0 - 53.0        Wt%        DOWM 100008
PH                                    5.0 - 6.5                     DOWM 100429
2000 Mesh Residue, per 900 ml         0.05 Max           Grams      DOWM 101784
--------------------------------- ----------------- ------------ ---------------

                                       12

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