Cdex, Inc. (fka CDEX)

[arloco]

"When was the Baxa money received....that's question worth asking at the annual meeting"...

No need to wait for the annual meeting, dgei.


In fiscal year 2004, the Company primarily raised capital by
issuing convertible promissory notes, which were converted by the investors into shares of Class A common stock. A majority of the convertible promissory notes were sold with
detachable warrants, which were exercised in fiscal years 2004 and 2005.

During the fiscal year ended October 31, 2005, the Company
received $3,615,250 in funding for 4,719,373 shares of Class
A common stock at an average price of approximately $.77 per
share. The funding comprised:

o $1,500,000 from the sale of 1,825,000 shares of common
stock to Baxa, at an average price of approximately $0.82
per share. In addition, the Company issued to Baxa a
warrant, exercisable through July 28, 2006, to purchase up
to 1,216,000 shares of its common stock at a price of $0.822
per share.

o $1,133,500 from the sale of 1,407,366 shares of common
stock, at an average price of approximately $0.81 per share.

o $892,750 from the exercise of warrants into 1,190,340
shares of common stock, at an average price of approximately
$.75 per share.

o $89,000 from the sale of convertible promissory notes. All
of the investors elected to convert the notes into 296,667
shares of common stock, at an average price of approximately
$0.30 per share.

The Company follows the requirements of EITF 00-27 in
recording the discount on the convertible notes associated
with both the value of the detachable warrants and the
intrinsic value of the embedded conversion option based on
the "effective conversion price" as defined in EITF 00-27.
The warrants were valued using the Black-Scholes model with
the following assumptions: no dividend yield, warrant life
of one year, volatility of 75%, interest rate of 1.04%. As
of October 31, 2004, the detachable warrants had a relative
fair market value of $504,843, leaving $1,204,907 of debt at
its relative fair market value which is convertible into
2,279,672 shares, resulting in an effective conversion price
of $.529 per share. The intrinsic value of $.221 per share
{the difference between the effective conversion price of
$.529 and the fair value of the common stock of $.75 per
share) for 2,279,672 shares results in a further discount
for the beneficial conversion feature of $504,843. The total
debt discount is amortized to interest expense over the life
of the notes and is fully recognized as interest expense
upon conversion. The Company recognized $1,009,686 as
interest expense for debt discount in fiscal year 2004.

http://sec.gov/Archives/edgar/data/1173738/000121465906000130/d126610ksb.txt