from Form SB-2, 12/30/2004:
EMPLOYMENT AGREEMENTS
Effective January 1, 2002, we entered into employment agreements with each of our executive officers. The agreements with Malcolm Philips and Timothy Shriver each continue for an indefinite period unless terminated by CDEX for "cause," or by the employee for "good reason" (as such terms are defined in the agreements), or upon two weeks prior written notice by either party to the other. The agreements provide for salaries based on annual amounts of $300,000 for Mr. Philips and $250,000 for Mr. Shriver, which are subject to review on an annual basis. The salary shall be payable in equal monthly installments, unless otherwise required by applicable state law and, based on CDEX's economic posture, may be paid in cash and/or stock, at CDEX's option. Each agreement provides for a minimum monthly cash payment to the employee of $7,500 for Mr. Shriver and $3,000 for Mr. Philips. CDEX has availed itself of this option for the past three fiscal years as reflected under "Compensation of Executive Officers." Each of these agreements provides for the forfeiture of restricted stock granted to the employee in the event of the employee's termination before the stock is fully vested. Under the agreements, each employee is entitled to a severance package in the event of termination by CDEX other than for "cause" or by the employee for "good reason." In each case, "good reason" includes a change in management of CDEX.
All of these employment agreements were amended on January 1, 2003 to
(a) increase the intended minimum monthly cash payment to the employee to $8,000,
(b) permit CDEX to pay the entire salary in common stock if paying cash is not in the best interest of the Company and
(c) adjust the severance provisions to reflect that (i) if termination occurred before January 1, 2004, payment of an amount equal to three years of the then current annual salary and CDEX common stock equal to three times the amount of initial stock grant provided to the employee when he started his employment;
(ii) if termination occurs after January 1, 2004 but before January 1, 2005, payment of an amount equal to two years of the then current annual salary and CDEX common stock equal to two times the amount of initial stock granted to the employee; or (iii) if termination occurs on or after January 1, 2005 but before January 1, 2006, payment of an amount equal to the then current annual salary and CDEX common stock equal to the amount of initial stock granted employee.
Effective January 1, 2003, we entered into an Employment Agreement with Dr. Wade Poteet. Except for Dr. Poteet's compensation, this agreement provides for substantially the same general terms and conditions as the employment agreements set forth above with an annual base salary of $210,000. The agreement is generally consistent with the agreements of all employees, providing a compensation package of cash and stock, along with an initial stock grant with forfeiture provisions should the employee resign from CDEX prior to a certain date.
