Headwaters Inc. Recipient of Safety Award.

Business Editors

DRAPER, Utah--(BUSINESS WIRE)--May 14, 2002

Headwaters Inc. (Nasdaq: HDWR) Tuesday announced that the DTE River Hill facility, operated by Covol Fuels, has received the J.A. Holmes Safety Association's Coal Processing Plant No Lost Time Safety Award for 2001.

This award recognizes Covol Fuels' stellar safety record at the DTE River Hill facility, involving over 115,000 man-hours, dating back to September 1999, without a lost-time accident. This record has resulted in the facility achieving the Mine Safety Health Administration's 0.0 Lost Time Accident Rating and 0.0 Incident Rating.

Plant Manager Ralph Bennett stated, "Achieving this safety milestone is a testimony to the perseverance, dedication and quality of Covol Fuels' commitment to safety, as well as the personal commitment made by each of our employees on a daily basis. We are honored to receive this award and are grateful that we have been able to return our employees home safely at end of each shift."

In addition, Max E. Reardon, a Covol Fuels maintenance technician at the DTE River Hill facility, has been recognized with the J.A. Holmes Safety Association's National B1 Individual Worker Award for his lifetime achievement of 40-plus years in the coal and synthetic fuel industry without a single lost-time accident.

Of Reardon's accomplishment, Bennett commented, "The test of time is the proof of any real accomplishment. Max's achievement in an oftentimes hazardous industry is a testament of his commitment to health and safety. Covol Fuels is very fortunate to have the benefit of Max's example and experience in our organization."

About Headwaters Inc.

Headwaters Inc. is a world leader in developing and deploying alternative fuel and related technologies. It is focused on converting fossil fuels such as coal and heavy oils to alternative energy products while improving energy efficiency and the environment.

Through its existing alternative fuels business, the company earns a growing revenue stream that provides the capital needed to acquire and expand synergistic new business opportunities. Headwaters Inc. trades under the Nasdaq symbol HDWR.

Certain statements contained in this document may be deemed to be forward-looking statements under federal securities laws, and Headwaters intends that such forward-looking statements be subject to the safe harbor created thereby.

Such forward-looking statements relate to: (i) the growth of Headwaters' revenues, earnings, or earnings per share; (ii) the ability of Headwaters to sustain the earnings stream from its alternative fuels business; (iii) the expectation that Headwaters' stock is undervalued or will increase in value in the future; (iv) the completion of any future acquisitions and the expectation that the value of such acquisitions will increase; (v) the commercialization of any technology acquired or developed.

Headwaters cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements contained herein.

Such factors include, but are not limited to: (a) the availability of tax credits to us and our licensees under the tax code; (b) our dependence on licensees to use our technology; (c) collection of payments outstanding; (d) limitations in the capital available to Headwaters to execute on its business plan, and the cost of that capital; (e) the ability of Headwaters to locate and close on attractive acquisition opportunities; (f) the company's limited operating history with its new business strategy and its ability to sustain and manage its growth under that strategy; (g) the success of the company in replacing and growing its financial performance before its legacy alternative fuels business declines; and other risks as detailed in Headwaters' annual report on Form 10-K, quarterly report on Form 10-Q, and other filings from time to time with the Securities and Exchange Commission.