Document:

Exhibit 10.8

               ASSIGNED CONSULTANT SERVICES AGREEMENT FOR MICHAEL
                 MERGENTHALER RESTATED AS EMPLOYMENT AGREEMENT

THIS EMPLOYMENT  AGREEMENT is entered into as of January 1, 2002 (the "EFFECTIVE
DATE"),  by and between  CDEX-Inc.,  a Nevada  corporation (the "COMPANY"),  and
Michael Mergenthaler (the "EMPLOYEE").

Whereas a Consultant  Services  Agreement  dated July 24, 2001 (the  "CONSULTANT
SERVICES AGREEMENT"),  among several named Consultants (including the Employee),
the Company and  Dynamic  Management  Resolutions  LLC ("DMR")  currently  is in
effect and provides for Employee to provide  services to Company  under  certain
terms.

Whereas on January 1, 2002,  that Consultant  Services  Agreement was amended to
allow  assignment of the Consultant  Services  Agreement as related to any named
Consultant upon written approval of that Consultant and the Company.

Whereas,  Employee and Company desire to have Employee provide services noted in
the Consultant  Services Agreement directly to the Company as an employee of the
Company,

The undersigned covenant and agree as follows:

First,  the obligations,  rights and benefits of DMR in the Consultant  Services
Agreement  as related to Employee are hereby  assigned to the  Company.  (By the
undersigned  signature of the DMR  representative,  DMR reflects  agreement with
this assignment.)

Second, the Employee and Company agree that as of the Effective Date note above,
Employee will provide service to Company as an employee pursuant to the terms of
the  Consultant  Services  Agreement,  whose  terms  have been  amended in part.
Employee,  Company  and DMR agree that the terms  stated  below are the  amended
Consultant Services Agreement as related to Employee.

1. EMPLOYMENT  AGREEMENT.  Subject to the terms and conditions set forth in this
Agreement,  the Company agrees to employ the Employee,  and the Employee accepts
employment with the Company, in accordance with the terms and provisions of this
Agreement.

2. TERM. This agreement shall remain in effect until terminated  pursuant to the
termination provisions provided herein.

3. SERVICES OF THE EMPLOYEE.  The Employee shall serve  initially as the Manager
of  Business  Development  and, as the needs of the  Company  dictate,  in other
positions as directed by the Company. The Employee shall faithfully perform such
services  for the  business  and affairs of the Company  (the  "SERVICES").  The
Employee  shall devote his best efforts and attention to the  performance of the
Services and shall expend such time as may be required to
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perform the Services.  The Employee shall not perform  services that are similar
in nature to the Services for any other person or entity for compensation.

4. PLACE OF PERFORMANCE. The Employee shall be based initially at such office of
the  Company  as the  Company  and the  Employee  shall  determine,  except  for
reasonable travel on Company business. If the Company requires that the Employee
relocate  his place of  performance  to a location  more than 100 miles from the
then-current  office,  the Company  shall pay or reimburse  the Employee for the
reasonable  moving and  relocation  expenses  incurred by the  Employee  and his
family to establish a personal residence at the new location.

5. SALARY.

     5.1.  SALARY.  The Company  shall pay to the  Employee a salary based on an
annual amount of $210,000 (the "SALARY"). The Company shall review the Salary on
an annual basis. The Salary shall be payable in equal monthly  installments,  or
in installments  as required by applicable  State law. Until January 1, 2003, to
the extent  that the  financial  posture of the  Company is such that paying the
full  monthly  installment  to  Employee  would  not  be in the  Company's  best
interest,  at the option of the Company monthly compensation in excess of $7,500
may be  deferred  until  January 1, 2003 and paid in cash or paid in  restricted
stock or stock  options  of the  Company.  Such  stock of the  Company  shall be
subject to all applicable federal and state laws, rules and regulations  related
to restricted stock. The Company shall impose no other  restrictions in relation
to such  restricted  stock except for those that arise by application of federal
or state laws, rules or regulations relating to such restricted stock.

     5.2 BONUS. At the discretion of Company, the Employee shall be eligible for
an  annual  performance   bonus.   Bonuses  (including  stock  bonuses)  may  be
distributed  based  on  Company  performance  and  the  Employee's  role in that
performance.

     5.3.  BENEFITS.  The Employee shall be entitled to receive such benefits as
the Company  may make  available  to its  employees  from time to time.  Nothing
contained in this Agreement shall prevent the Company,  at any time or from time
to time, from effecting modifications in the benefits, including eliminating any
or all of such benefits.

     5.4  VACATION;  HOLIDAYS.  The  Employee  shall be  entitled  to all public
holidays as are observed by the Company and vacation days in accordance with the
applicable vacation policies of the Company. The Employee shall take holidays at
a reasonable time or times for the Company.

     5.5 EQUITY  PARTICIPATION.  Pursuant to the Consultant  Services Agreement,
600,000 shares of restricted  common stock of the Company (the "INITIAL  STOCK")
have been issued to Employee,  subject to the graduated repayment provisions set
forth below. The Employee agrees to comply strictly with all legal  requirements
regarding the stock,  including  those related to  distribution of the stock and
restrictions associated with the stock.

          5.5.1. REPAYMENT. Notwithstanding the remainder of the Section, if the

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Employee's services to the Company are terminated because of death or disability
(defined as the inability to substantially perform the Services by reason of any
medically  determined  physical  or  mental  impairment  that  is or  will  be a
permanent  condition or one that will continue for at least three  months),  the
Employee has no obligation to repay any of the Initial Stock. The Employee shall
repay in accordance with the following  repayment schedule part of the shares of
the  Initial  Stock (or other  equivalent  shares of the  Company  stock) if the
Employee's  services  are  terminated  prior to July 24, 2004 by the Company for
"Cause" or by Employee  without "Good Reason" as those terms are defined in this
Section 5.5. In either event,  then within sixty (60) days thereafter,  Employee
shall repay to the Company a portion of that Initial  Stock in  accordance  with
the following schedule.

                    (a) if  termination  occurs prior to January 24,  2002,  the
Employee shall repay seventy percent (70%) of the Initial Stock;

                    (b) if  termination  occurs after January 23, 2002 but prior
to July 24, 2002,  the Employee  shall repay fifty  percent (50%) of the Initial
Stock;

                    (c) if  termination  occurs after July 23, 2002 but prior to
July 24, 2003,  the Employee  shall repay  thirty  percent  (30%) of the Initial
Stock; and

                    (d) if  termination  occurs after July 23, 2003 but prior to
July 24, 2004, Employee shall repay fifteen percent (15%) of the Initial Stock.

          5.5.2  TERMINATION  FOR CAUSE.  Termination by the Company for "CAUSE"
shall be limited to any of the following:

               (i)  The  conviction  of  the  Employee  of,  or a plea  of  nolo
contendere by the Employee to, a felony;

               (ii)  The  intentional  fraud  by the  Employee  on,  or  willful
misappropriation  by the Employee of, funds or property  belonging to or claimed
by the Company and exceeding $1000.00 in an aggregate amount;

               (iii)  Intentional  misconduct by the Employee in connection with
the performance of duties, or the Employee's  failure to perform the Services in
the best  interests  of the Company  (including,  without  limitation,  material
breach by the Employee in performance  of the Services but not minor  violations
of rules and policies of the Company) that  substantially  and adversely impacts
the Company;

               (iv)  The  Employee's  chronic  use of  alcohol,  drugs  or other
similar substances affecting work performance;

               (v) The material breach by the Employee of the performance of any
material  part of the  Services or the  material  breach by the  Employee of any
agreement  that is  referenced  in Section 9 that  substantially  and  adversely
impacts the Company; or

               (vi) The material breach by the Employee of any provision of this
Agreement that substantially and adversely impacts the Company.

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          5.5.3  TERMINATION  FOR GOOD REASON.  Termination  by the Employee for
"Good Reason" shall be limited to any of the following:

               (i) The  occurrence  of a material  breach by the  Company of any
provision  of this  Agreement  that  significantly  and  adversely  impacts  the
Employee;

               (ii) A significant  reduction or  modification in the Services of
Employee that is inconsistent with Employee's title or position;

               (iii)  Removal of the  current  President,  CEO,  Chairman of the
Board, or Senior Vice President of Operations,  that significantly and adversely
impacts Employee;

               (iv) The  approval  of a plan by the  Board of  Directors  of the
Company  involving the  dissolution of the Company that is not rescinded  within
thirty (30) days after its approval; or

               (v) The  involuntary  or voluntary  filing for  bankruptcy of the
Company that is not dismissed within ninety (90) days after the date of filing.

          5.5.4 REPURCHASE  RIGHTS. In the event that the Employee's  employment
is terminated, then the Company shall have the right, but not the obligation, to
repurchase  all or a part of the Initial  Stock then owned by the  Employee at a
price  equal to fair  market  value,  less  any  appropriate  discounts  for the
restrictive  nature of, and the minority  interest  represented  by, the Initial
Stock.  In the event that the parties can not mutually  agree on the fair market
value of the Initial  Stock,  the value shall be  determined by  arbitration  in
accordance with the provisions of Section 12, except that the arbitrators  shall
each be qualified  appraisers  having at least ten years  experience  in valuing
commercial  businesses,  similar  in  nature  to  that  of the  Company,  in the
metropolitan Washington D.C area, and the decision of the arbitrator(s) shall be
final and conclusive on both parties.

          5.5.5 COMPLIANCE.  The Employee  acknowledges that the issuance and/or
registration  of the Company's  stock must comply with all  applicable  laws and
regulations  relating  thereto.  Accordingly,  the Employee agrees that he shall
accept  shares  of the  Company's  stock  subject  to all  applicable  laws  and
regulations,  and shall  provide and  deliver to the  Company  all  information,
certifications,  and other  documentation  as may be requested by the Company as
part of the  Company's  compliance  with any  applicable  laws  and  regulations
relating to the issuance  and/or  registration  of any of the  Company's  stock,
including but not limited to the Initial Stock.

6.  EXPENSES.  The Company  shall  reimburse  the  Employee  for all  reasonable
business  expenses  incurred by the Employee that are authorized by the Company.
Reimbursement  shall be made in  accordance  with the  policies  of the  Company
related to reimbursable expenses.

7.  TERMINATION  OF  EMPLOYMENT.  The  Employee's  services for the Company will
continue  until  terminated in accordance  with the  provisions of this Section.
Employment  hereunder may

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be  terminated  (i) by either  party upon two weeks  prior  written  notice (the
"NOTICE OF  TERMINATION"),  or (ii)  immediately upon the death of the Employee.
All Parties  acknowledge that Employee is an employee at will. The date given in
the Notice of Termination as the last day of the Employee's  employment shall be
deemed the "DATE OF TERMINATION".  This Agreement shall terminate on the Date of
Termination  except as otherwise provided in Section 13.4. The Company shall pay
the Employee the then current Salary of Employee through the Date of Termination
and all other  unpaid  amounts,  if any, to which the Employee is entitled as of
the Date of Termination, such as expenses (Section 6).

8.  TERMINATION  OF  EMPLOYMENT  BEFORE JULY 24, 2004.  If before July 24, 2004,
Company terminates Employee for other than "CAUSE" (defined in Section 5.5.2) or
Employee terminates for "GOOD REASON" (defined in Section 5.5.3),  Company shall
pay  to  Employee  severance  compensation  in  accordance  with  the  following
schedule:

     8.1 If  termination  occurs  before  January 1, 2003,  payment of an amount
equal to two years of the then current  annual Salary and Company stock equal to
three times the amount of Initial Stock provided at the direction of Employee.

     8.2 If  termination  occurs on or after January 1, 2003 but before July 24,
2004,  payment of an amount equal to one year of the then current  annual Salary
or the monthly  Salary  through July 2004 with a minimum of four months  Salary,
whichever is less, and Company stock equal to 30% of the amount of Initial Stock
provided to Employee.

9. CDEX AGREEMENTS. As an express condition for the Company's agreement to enter
into  this  Agreement,  and as a  pre-condition  to the  effectiveness  of  this
Agreement,  the Employee  agrees to (i) keep the  confidential  and  proprietary
information  and the  intellectual  property of the Company  confidential;  (ii)
assign to the Company  all of the  ownership  rights in and to any  intellectual
property relating to the Company and its business that is developed, created, or
discovered  during the term of this  Agreement;  and (iii)  agree not to compete
with the  Company  and its  business  or  solicit  the  Company's  customers  or
employees  during the period of employment  with the Company and for a period of
three (3) years  thereafter.  To further provide for the  implementation of this
provision,  the Employee shall execute a CDEX Non-disclosure and Confidentiality
Agreement and a CDEX Non-Compete and  Non-Solicitation  Agreement (jointly,  the
"CDEX AGREEMENTS"),  copies of which are attached hereto as Exhibit A, the terms
and conditions of which are  specifically  incorporated  herein by reference.  A
breach by the  Employee of a provision  in any of the CDEX  Agreements  shall be
deemed a material breach of this Agreement by the Employee.

10. OWNERSHIP OF INTELLECTUAL PROPERTY.

     10.1. THE BUSINESS.  The parties acknowledge that the Company is engaged in
the  development,  marketing  and  sale  of  certain  proprietary  technologies,
processes  and related  products in the areas of chemical  detection,  technical
processes,  and technical/business  services, and that the Company may also from
time to time become or may intend to become engaged in other business  endeavors
(individually and collectively,  the "BUSINESS"). The Company shall be deemed to
intend to become  engaged in a business  endeavor  if it has devoted or expended
any

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significant resources, either financial or human resources, towards the proposed
endeavor,  either in planning or  implementing  the  undertaking of such planned
endeavor.

     10.2. THE INTELLECTUAL  PROPERTY. In connection with this Agreement and the
performance of the Services,  the Employee acknowledges that there may exist now
or may exist in the future trade secrets,  confidential  information,  technical
information,   know-how,  inventions,   patents,  discoveries  (whether  or  not
patentable),  copyrights,  trademarks, service marks, techniques, data, systems,
methods, processes, improvements, developments, enhancements, and modifications,
whether oral or written, or in recorded form, tangible or intangible,  and other
proprietary  rights,  which  are or may be  conceived,  developed,  designed  or
otherwise created, modified or improved by the Employee, in whole or in part, or
which the Employee may receive,  produce, obtain, or learn about, in whole or in
part, in connection  with the performance of the Services or relating in any way
or manner to, or arising out of, the Business and the  operations of the Company
during the term of this  Agreement,  or which the  Employee  may develop or make
from or by  reason  of  knowledge  gained  from  employment  (collectively,  the
"INTELLECTUAL  PROPERTY").  The  Employee  agrees  that all  rights,  title  and
interest in and to the  Intellectual  Property  shall  belong to the Company and
shall be considered as "work made for hire".  The Employee shall make prompt and
complete  disclosure  from  time  to  time to the  Company  of all  Intellectual
Property developed by the Employee, either solely or in conjunction with others.

     10.3.  ASSIGNMENT OF RIGHTS TO INTELLECTUAL  PROPERTY.  The Employee hereby
assigns to the Company any and all right,  title and interest  that the Employee
has now or may  have in the  future  in and to the  Intellectual  Property.  The
Employee  agrees to execute  any  instruments  and to do all  things  reasonably
requested by the Company,  both during and after the term of this Agreement,  to
vest the Company with all ownership rights in the Intellectual  Property. If any
Intellectual Property can be protected by copyrights,  patents,  trademarks,  or
service marks, then such copyright,  patent,  trademark, or service mark, as may
be applicable, shall be owned solely, completely and exclusively by the Company,
and the Employee shall execute such  assignments and other documents and provide
such  assistance as the Company may  reasonably  request in order to protect the
Company's ownership of the Intellectual  Property.  The Employee hereby appoints
the Company as his attorney-in-fact to execute any document that the U.S. Patent
and  Trademark  Office,   the  U.S.  Copyright  Office,  or  any  other  similar
governmental or quasi-governmental  entity in any state or foreign country shall
require in order to establish,  protect,  and record the Company's  ownership of
all of the rights, title and interests in and to the Intellectual Property. This
appointment  of the  Company as the  attorney-in-fact  for the  Employee  to act
hereunder is irrevocable.

     10.4.  SURVIVORSHIP.  The terms of Section 10 shall survive the termination
of this Agreement and shall continue until the later of (i) five (5) years after
the Date of Termination, or (ii) fifty (50) years after the Effective Date.

11. DEFAULT. The Employee acknowledges that many of the provisions herein are of
a special and unusual  character  that have and will have a unique  value to the
Company,  the loss of which cannot  adequately be  compensated  in damages in an
action at law. Any violation or attempted

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violation of any provisions of Section 9, Section 10 or any provisions of any of
the CDEX  Agreements by the Employee shall be deemed to be a material  breach of
this  Agreement.  The  Employee  hereby  agrees to  indemnify,  defend  and hold
harmless  the  Company  from  any and all  claims,  losses,  actions,  injuries,
damages, fines,  penalties,  or other liabilities,  including but not limited to
loss of profits and other  economic  losses,  attorneys'  fees and court  costs,
resulting  from  or  related  to a  material  breach  of this  Agreement  by the
Employee.

     11.1.  EQUITABLE RELIEF. The parties  acknowledge that any damages incurred
by the Company as a result of any breach of Section 9,  Section 10 or the breach
of any other material  provision of this Agreement will be great and irreparable
and  difficult  to  quantify.  Without  prejudice  to the  rights  and  remedies
otherwise  available,  and without the need for posting any bond or surety,  the
Company  shall be entitled to equitable  relief,  such as for an  injunction  or
specific performance, if the Employee should breach or threaten to breach any of
the provisions of this Agreement.

     11.2. REMEDIES AVAILABLE.  Subject to the requirement for arbitration under
Section 12, nothing  herein shall be construed as  prohibiting  the Company from
pursuing any remedies, both federal and state, legal or equitable,  available to
the Company for any breach or threatened breach by the Employee.

     11.3.  RECOVERY OF COSTS. In the event that any enforcement action is taken
by  either  party  hereunder,   including  filing  an  action  in  court  or  in
arbitration,  the prevailing  party shall be entitled to recover from the losing
party its costs and expenses, including its reasonable attorneys' fees and court
costs.

12. ARBITRATION.  Any failure to perform, controversy or claim arising out of or
relating to this Agreement or the breach, termination or validity thereof, other
than an  action  for  equitable  relief,  shall  be  determined  exclusively  by
arbitration  in  accordance  with  the  provisions  of  this  Section  12 and in
accordance  with  the  rules  of  the  American   Arbitration   Association  for
arbitrating  commercial  matters.  The arbitration  shall be held in Washington,
D.C., the surrounding  metropolitan area of Maryland,  or such other location as
the parties shall  mutually  agree.  The  arbitrators  shall base their award on
applicable Maryland law and judicial precedent,  and shall accompany their award
with  written  findings  of fact and  conclusions  of law.  The  decision of the
arbitrators shall be binding on the parties, except that either party may appeal
the arbitrators'  decision by filing an action to reconsider the decision of the
arbitrators  in a court having  jurisdiction  hereunder.  In any such action the
arbitrators'  findings of fact shall be  conclusive  and binding on both parties
and the sole questions to be determined by the court shall be (i) whether or not
the arbitrators'  decision was contrary to Maryland law and judicial  precedent,
and (ii) if the court determines that the arbitrators'  decision was contrary to
Maryland  law and  judicial  precedent,  then how the dispute  shall be resolved
based on the  arbitrators'  findings  of facts  and  Maryland  law and  judicial
precedent.  The decision of the court as to the  resolution of the dispute under
Maryland law and judicial  precedent shall supercede the arbitrators'  decision.
Judgment upon the award rendered by the  arbitrators,  as modified by the court,
if  applicable,  may be entered in any court having  jurisdiction  in accordance
herewith.

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     12.1 SELECTION OF ARBITRATORS.  An arbitrator  shall be selected by each of
the parties,  and the arbitrators  shall mutually  select another  arbitrator to
serve  with  them  so  that  there  shall  be  an  odd  number  of  arbitrators.
Alternatively,  the  parties  may  agree to  accept a  single  arbitrator  to be
mutually  agreed  upon by the  parties.  Each  person  serving as an  arbitrator
hereunder  shall be a  professional  with  excellent  academic and  professional
credentials  who has had  experience  as an  arbitrator  and at least  ten years
experience  in the field of  resolving  commercial  disputes  in the  Washington
Metropolitan area.

     12.2  DISCOVERY.  Each party shall,  upon the written  request of the other
party,  provide the other with copies of documents relevant to the issues raised
thereby.  Other  discovery may be ordered by the  arbitrators  to the extent the
arbitrators deem additional  discovery  appropriate,  and any dispute  regarding
discovery,  including disputes as to the need therefor or the relevance or scope
thereof,  shall be determined by the arbitrators,  which  determination shall be
conclusive.

     12.3  ARBITRATION  EXPENSES.  All expenses and fees of the  arbitrator  and
expenses for hearing facilities, stenographers,  including reasonable attorneys'
fees and the costs of expert  witnesses,  and other expenses of the  arbitrators
shall  be  borne  by the  non-prevailing  party;  provided,  however,  that  the
arbitrators  may  allocate a portion of such  expenses to the other party if the
arbitrators  believe  such a measure is  justified by the conduct of the parties
during the arbitration.

     12.4 CONFIDENTIALITY OF PROCEEDINGS.  The arbitration proceedings conducted
pursuant  hereto  shall  be  confidential.  Neither  party  shall  disclose  any
information  about  the  evidence  adduced  by  the  other  in  the  arbitration
proceeding  or about  documents  provided  by the other in  connection  with the
proceeding  except  in the  course  of a  judicial,  regulatory  or  arbitration
proceeding or as may be requested by a governmental authority. Before making any
disclosure permitted by the preceding sentence, the party intending to make such
disclosure shall give the other party reasonable  written notice of the intended
disclosure and afford the other party opportunity to protect its interests.  The
arbitrators,  expert witnesses and stenographic reporters shall sign appropriate
nondisclosure agreements in order to effectuate this agreement of the parties as
to confidentiality.

     12.5 EQUITABLE RELIEF. Notwithstanding anything herein to the contrary, any
action brought by the Company for injunctive  relief or specific  performance is
not subject to the requirements for arbitration hereunder,  and may be sought in
any court  having  jurisdiction  in  accordance  herewith  without  resorting to
arbitration.

13   MISCELLANEOUS.

     13.1  NOTICES.  All  notices,  demands,  requests  or other  communications
required  or  permitted  to be given or made  hereunder  shall be in writing and
shall be  hand-delivered  or shall be mailed  such as to  provide  assurance  of
delivery.

     13.2  REPRESENTATIONS.  The  Employee  agrees to execute any proper oath or
verify any proper  document  required to carry out the terms of this  Agreement.
The Employee represents

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that this  Agreement  has been duly  executed and  delivered by the Employee and
constitutes  the  valid  and  binding  obligations  of the  Employee;  that  the
execution,  delivery and  performance of this Agreement by the Employee will not
violate any  provision of any  contract or other  agreement,  including  but not
limited to a non-compete or non-disclosure agreement, to which the Employee is a
party or which  purports to be binding upon the Employee;  that the Employee has
carefully read and reviewed the provisions set forth herein,  and having done so
he agrees that those  provisions,  including  but not limited to the  provisions
relating to the ownership of the Intellectual  Property,  the  non-disclosure of
confidential   information,   and  the  non-competition   and   non-solicitation
requirements,  are fair  and  reasonable  and are  reasonably  required  for the
protection of the  legitimate  business  interests of the Company;  and that the
Employee  has had the  opportunity  to obtain  counsel of his own  selection  to
review this Agreement on his behalf.

     13.3 SEVERABILITY.  The invalidity or  unenforceability  of any one or more
provisions of this Agreement shall not affect the validity or  enforceability of
the other  provisions  of this  Agreement,  which shall remain in full force and
effect.

     13.4  SURVIVAL.  It is the express  intention  and agreement of the parties
hereto  that the  provisions  of  Sections  9, 10,  and 12  hereof  and the CDEX
Agreements  shall survive the  termination of this Agreement.  In addition,  all
obligations of the Employee to repay any shares of stock, if applicable, and all
rights of the Company to  repurchase  the Initial  Stock shall also  survive any
termination of this Agreement on the terms and conditions set forth herein.

     13.5  ASSIGNMENT.  The  rights  and  obligations  of the  parties  to  this
Agreement  shall not be  assignable  or  delegable,  except  that the rights and
obligations  of the Company  hereunder  shall be  assignable  and  delegable  in
connection  with  any  subsequent   merger,   consolidation,   sale  of  all  or
substantially  all of the assets of the Company or similar  reorganization  of a
successor corporation.

     13.6  BINDING  EFFECT.   Subject  to  any  provisions  hereof   restricting
assignment,  this Agreement shall be binding upon and shall inure to the benefit
of the parties and their respective heirs, devisees, executors,  administrators,
legal representatives, successors and assigns.

     13.7 AMENDMENT;  WAIVER.  This Agreement  shall not be amended,  altered or
modified except by an instrument in writing duly executed by the parties hereto.
Neither the waiver by either of the  parties  hereto of a breach of or a default
under any of the provisions of this Agreement,  nor the failure of either of the
parties,  on one or more  occasions,  to enforce any of the  provisions  of this
Agreement or to exercise any right or privilege  hereunder,  shall thereafter be
construed as a waiver of any subsequent  breach or default of a similar  nature,
or as a waiver of any such provisions, rights or privileges hereunder.

     13.8 HEADINGS.  Section and subsection headings contained in this Agreement
are inserted for convenience of reference only, shall not be deemed to be a part
of this Agreement for any purpose, and shall not in any way define or affect the
meaning, construction or scope of any of the provisions hereof.

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     13.9  GOVERNING  LAW. This  Agreement,  the rights and  obligations  of the
parties hereto,  and any claims or disputes relating thereto,  shall be governed
by and construed in  accordance  with the laws of the State of Maryland (but not
including the choice of law rules thereof). Any action filed in relation to this
Agreement and the  performance  of the parties  hereunder  shall be filed in the
appropriate  state court or the U.S.  District  Court having  jurisdiction  over
Rockville,  Maryland,  the parties  hereto waiving any other venue to which they
may be entitled by virtue of domicile or otherwise.  Each of the parties  hereto
waives a trial by jury in regard  to any  claims or  disputes  relating  to this
Agreement.

     13.10 ENTIRE AGREEMENT.  This Agreement and the CDEX Agreements  constitute
the entire  agreement  between  the parties  respecting  the  employment  of the
Employee,  there being no  representations,  warranties or commitments except as
set forth herein.

     13.11  COUNTERPARTS.  This  Agreement  may  be  executed  in  two  or  more
counterparts,  each of which  shall  be an  original  and all of which  shall be
deemed to constitute one and the same instrument.

     IN WITNESS WHEREOF,  the undersigned have duly executed this Agreement,  or
have caused this  Agreement to be duly executed on their behalf  effective as of
the day and year first hereinabove written.

                               CDEX-Inc.

                                    By:   /s/ Malcolm H. Philips, Jr.
                                       ----------------------------------------
                                    Name: Malcolm H. Philips, Jr.
                                    Title: President and CEO

                               Employee:

                                    By:    /s/ Michael Mergenthaler
                                       ----------------------------------------
                                    Name:  Michael Mergenthaler

                               Dynamic Management Resolutions

                                    By:    /s/ Wade Poteet
                                       ----------------------------------------
                                    Name:  Wade Poteet

                                       10
<PAGE>

                              EMPLOYMENT AGREEMENTS
                                    EXHIBIT A

1.   CDEX  Non-disclosure and Confidentiality  Agreement,  signed by the Company
     and the Employee

2.   CDEX Non-Compete and Non-Solicitation  Agreement, signed by the Company and
     the Employee

                                       11<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                             <C>             <C>                                <C>
                                                                                1. CONTRACT ID CODE                PAGE OF PAGES
             AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT                    U                               1       3
------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.   3. EFFECTIVE DATE               4. REQUISITION/PURCHASE REQ. NO.      5. PROJECT NO. (IF APPLICABLE)
            P00001                 See blk 16C                     N/A
------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY                CODE N00178                         7. ADMINISTERED BY (IF OTHER THAN ITEM 6)           CODE S2101A
                                -------------------------------                                                         ------------
Contracting Officer                                                DCMA Maryland
NAVAL SURFACE WARFARE CENTER, DAHLGREN                             217 East Redwood St.
DIVISION 17320 Dahlgren Road                                       Suite 1800
Dahlgren, VA 22448-5100                                            Baltimore, MD 21202-5299
------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (NO., STREET, COUNTY, STATE AND ZIP CODE)     (X) 9A. AMENDMENT OF SOLICITATION NO.

CDEX, INC.
1700 Rockville Pike                                                                 ------------------------------------------------
Suite 400                                                                           9B. DATED (SEE ITEM 11)
Rockville, MD 20852

                                                                                ----------------------------------------------------
                                                                                    10A. MODIFICATION OF CONTRACT/ORDER NO.

                                                                                         N00178-03-C-3079
                                                                                X   ------------------------------------------------
                                                                                    10B. DATED (SEE ITEM 13)

                                                                                         08 May 2003
------------------------------------------------------------------------------------------------------------------------------------
CODE 3EKM0                        FACILITY CODE
------------------------------------------------------------------------------------------------------------------------------------
                                      11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
------------------------------------------------------------------------------------------------------------------------------------

|_| The above numbered solicitation is amended as set forth in Item 14. The hour
    and date specified for receipt of Offers                                          |_| is extended,          |_| is not extended.

Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended,
by one of the following methods:

(a) By completing items 8 and 15, and returning _________ copies of the amendment; (b) By acknowledging receipt of this amendment on
each copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.

------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (IF REQUIRED)

    N/A
------------------------------------------------------------------------------------------------------------------------------------
                                   13. THIS ITEM ONLY APPLIES TO MODIFICATION OF CONTRACTS/ORDERS,
                                     IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
------------------------------------------------------------------------------------------------------------------------------------
|X|     A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (SPECIFY AUTHORITY) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT
           ORDER NO. IN ITEM 10A.
------------------------------------------------------------------------------------------------------------------------------------
 X      B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (SUCH AS CHANGES IN PAYING OFFICE,
           APPROPRIATION DATE, ETC.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
------------------------------------------------------------------------------------------------------------------------------------
        C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

------------------------------------------------------------------------------------------------------------------------------------
        D. OTHER (SPECIFY TYPE OF MODIFICATION AND AUTHORITY)

------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor   |X| is not,   |_| is required to sign this document and return   _________ copies to the issuing office.
------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (ORGANIZED BY UCF SECTION HEADINGS, INCLUDING SOLICITATION/CONTRACT SUBJECT MATTER WHERE
    FEASIBLE.)

    SEE PAGES HEREIN

Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (TYPE OR PRINT)                   16A. NAME AND TITLE OF CONTRACTING OFFICER (TYPE OR PRINT)

                                                                     WILLIAM T. ARMSTRONG
------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR                   15C. DATE SIGNED      16B. UNITED STATES OF AMERICA                      16C. DATE SIGNED

                                                                BY /s/ William T. Armstrong                             7/16/2003
----------------------------------------                           ----------------------------------------
(SIGNATURE OF PERSON AUTHORIZED TO SIGN)                           (SIGNATURE OF CONTRACTING OFFICER)
------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-8070                                          30-105                                   STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE                                                                              Prescribed by GSA
                                                                                                       FAR (48 CFR) 53.243
</TABLE>

                                   [ORIGINAL]
<PAGE>

CDEX, INC.
N00178-03-C-3079
MODIFICATION P00001

Block 14: Description of Modification

      a. The purpose of this modification is to make the following changes:

            1.    Delete the following information from Standard Form 26 Block
                  12:

                  U.S. Army Corps of Engineers Finance (Code S18020)
                  C/O U.S. Army Corps of Engineers Finance Center
                  5722 Integrity Drive
                  Millington, TN 38054-5005

                  And replace with the following:

                  DFAS/Columbus Center (Code HQ0338)
                  DFAS/CO/South Entitlement Operations
                  P.O. Box 182264
                  Columbus, OH 43218-2264

            2.    Make the following changes to Clause Dd1-G10 Government
                  Contract Administration Points-of-Contact and
                  Responsibilities, page 12 of the contract:

Delete the following:

      5.    PAYING OFFICE:

            (a) Name: United States Army Corps of Engineers (USACE)
                  Baltimore District (E1)
                  C/O USACE Finance Center
                  5722 Integrity Drive
                  Millington, TN 38054-5005

            And replace with the following:

            5.    PAYING OFFICE:

                  (a) Name: DFAS-Columbus Center (HQ0338)
                        DFAS/CO/South Entitlement Operations
                        P.O. Box 182264
                        Columbus, OH 43218-2264

                        (b) All other terms and conditions remain the same.

<PAGE>

CDEX, INC.
N00178-03-C-3079
MODIFICATION P00001

DISTRIBUTION:

CDEX, Inc.
MMERGENTALER@CDEX-INC.COM

Code J12/Roger Boughton
BOUGHTONROGERA@NSWC.NAVY.MIL

DCMA/Maryland

DFAS/South Entitlement

<PAGE>

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                             <C>
                      AWARD/CONTRACT                            1. THIS CONTRACT IS A RATED ORDER        RATING        PAGE OF PAGES
                                                                   UNDER DPAS (15 CFR 350)         -->
                                                                                                         DO-C9             1   27
------------------------------------------------------------------------------------------------------------------------------------
2. CONTRACT (PROC. INST. IDENT.) NO.                            3. EFFECTIVE DATE        4. REQUISITION/PURCHASE REQUEST/PROJECT NO.

   N00178-03-C-3079                                                25 Apr 2003              J10000/30711858
------------------------------------------------------------------------------------------------------------------------------------
5. ISSUED BY                               CODE     N00178      6. ADMINISTERED BY (IF OTHER THAN ITEM 5)       CODE     S2101A
                                                ---------------                                                      ---------------

Contracting Officer                                                DCMA Maryland
Naval Surface Warfare Center, Dahlgren Division                    217 East Redwood St.
17320 Dahlgren Road (Attn: XDS13-Bldg. 183-Rm.106)                 Suite 1800
Dahlgren, VA 22448-5100                                            Baltimore, MD 21202-5299
------------------------------------------------------------------------------------------------------------------------------------
7. NAME AND ADDRESS OF CONTRACTOR (NUMBER, STREET, CITY, COUNTY, STATE AND ZIP CODE)    8. DELIVERY

CDEX, INC.                                                                             |_| FOB ORIGIN      |X| OTHER (SEE BELOW)
1700 Rockville Pike
Suite 400                                                                               --------------------------------------------
Rockville, MD 20852                                                                    9. DISCOUNT FOR PROMPT PAYMENT

                                                                                        --------------------------------------------
                                                                                        10. SUBMIT INVOICES          ITEM
                                                                                        (4 COPIES UNLESS OTHER-  -->
                                                                                        WISE SPECIFIED) TO THE
                                                                                        ADDRESS SHOWN IN:            SEE SECT. G
------------------------------------------------------------------------------------------------------------------------------------
CODE  3EKM0                                     FACILITY CODE
------------------------------------------------------------------------------------------------------------------------------------
11. SHIP TO/MARK FOR                       CODE     N00178      12. PAYMENT WILL BE MADE BY                     CODE     S18020
                                                ---------------                                                      ---------------

NAVAL SURFACE WARFARE CENTER, BLDG. 125                             U.S. ARMY CORPS OF ENGINEERS FINANCE
ATTN: ROGER BOUGHTON/CODE J12                                       C/O U.S. ARMY CORPS OF ENGINEERS, FINANCE CTR.
17320 DAHLGREN RD., DAHLGREN, VA. 22448-5100                        5722 INTEGRITY DRIVE, MILLINGTON, TN 38054-5005
------------------------------------------------------------------------------------------------------------------------------------
13. AUTHORITY FOR USING OTHER THAN FULL AND OPEN                14. ACCOUNTING AND APPROPRIATION DATA
    COMPETITION:

    |_| 10 U.S.C. 2304(C)(     )   |_| 41 U.S.C. 253 (C)(    )      SEE SCHEDULE (PAGE 11)

------------------------------------------------------------------------------------------------------------------------------------
15A. ITEM NO.                     15B. SUPPLIES/SERVICES        15C. QUANTITY    15D. UNIT     15E. UNIT PRICE     15F. AMOUNT
------------------------------------------------------------------------------------------------------------------------------------

                                       SEE SCHEDULE

                                       AID# 44883
------------------------------------------------------------------------------------------------------------------------------------
                                                                                15G. TOTAL AMOUNT OF CONTRACT -->  $ 196,483.00
------------------------------------------------------------------------------------------------------------------------------------
                                                       16. TABLE OF CONTENTS
------------------------------------------------------------------------------------------------------------------------------------
(X) SEC.                  DESCRIPTION                PAGE(S)    (X) SEC.                  DESCRIPTION                       PAGE(S)
------------------------------------------------------------------------------------------------------------------------------------
              PART I - THE SCHEDULE                                               PART II - CONTRACT CLAUSES
------------------------------------------------------------------------------------------------------------------------------------
|X|      A    SOLICITATION/CONTRACT FORM                2-3     |X|      I    CONTRACT CLAUSES                               17-26
------------------------------------------------------------------------------------------------------------------------------------
|X|      B    SUPPLIES OR SERVICES AND PRICES/COSTS     4-6                     PART III - LIST OF DOCUMENTS, EXHIBITS AND OTHER
----------------------------------------------------------------                ATTACH.
|X|      C    DESCRIPTION/SPECS./WORK STATEMENT         6-8
------------------------------------------------------------------------------------------------------------------------------------
|X|      D    PACKAGING AND MARKING                      9      |X|      J    LIST OF ATTACHMENTS                            26-27
------------------------------------------------------------------------------------------------------------------------------------
|X|      E    INSPECTION AND ACCEPTANCE                  9                      PART IV - REPRESENTATIONS AND INSTRUCTIONS
------------------------------------------------------------------------------------------------------------------------------------
|X|      F    DELIVERIES OR PERFORMANCE                 10               K    REPRESENTATIONS, CERTIFICATIONS AND
----------------------------------------------------------------              OTHER STATEMENTS OF OFFERORS
|X|      G    CONTRACT ADMINISTRATION DATA             11-15
------------------------------------------------------------------------------------------------------------------------------------
|X|      H    SPECIAL CONTRACT REQUIREMENTS            15-17             L    INSTRS., CONDS., AND NOTICES TO OFFERORS
------------------------------------------------------------------------------------------------------------------------------------
                                                                         M    EVALUATION FACTORS FOR AWARD
------------------------------------------------------------------------------------------------------------------------------------
                                   CONTRACTING OFFICER WILL COMPLETE ITEM 17 OR 18 AS APPLICABLE
------------------------------------------------------------------------------------------------------------------------------------
17.   |X| CONTRACTOR'S NEGOTIATED AGREEMENT (CONTRACTOR IS      18.   |_| AWARD (CONTRACTOR IS NOT REQUIRED TO SIGN THIS
      REQUIRED TO SIGN THIS DOCUMENT AND RETURN 1 COPIES TO           DOCUMENT.) YOUR OFFER ON SOLICITATION NUMBER
      ISSUING OFFICE.) CONTRACTOR AGREES TO FURNISH AND               ____________, INCLUDING THE ADDITIONS OR CHANGES MADE
      DELIVER ALL ITEMS OR PERFORM ALL THE SERVICES SET               BY YOU WHICH ADDITIONS OR CHANGES ARE SET FORTH IN
      FORTH OR OTHERWISE IDENTIFIED ABOVE AND ON ANY                  FULL ABOVE, IS HEREBY ACCEPTED AS TO THE ITEMS LISTED
      CONTINUATION SHEETS FOR THE CONSIDERATION STATED                ABOVE AND ON ANY CONTINUATION SHEETS. THIS AWARD
      HEREIN. THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO            CONSUMMATES THE CONTRACT WHICH CONSISTS OF THE
      THIS CONTRACT SHALL BE SUBJECT TO AND GOVERNED BY THE           FOLLOWING DOCUMENTS: (A) THE GOVERNMENT'S SOLICITATION
      FOLLOWING DOCUMENTS: (A) THIS AWARD/CONTRACT, (B) THE           AND YOUR OFFER, AND (B) THIS AWARD/CONTRACT. NO
      SOLICITATION, IF ANY, AND (C) SUCH PROVISIONS,                  FURTHER CONTRACTUAL DOCUMENT IS NECESSARY.
      REPRESENTATIONS, CERTIFICATIONS, AND SPECIFICATIONS,
      AS ARE ATTACHED OR INCORPORATED BY REFERENCE HEREIN.
      (ATTACHMENTS ARE LISTED HEREIN.)
------------------------------------------------------------------------------------------------------------------------------------
19A. NAME AND TITLE OF SIGNER (TYPE OR PRINT)                   20A. NAME OF CONTRACTING OFFICER

                                                                     WILLIAM T. ARMSTRONG
------------------------------------------------------------------------------------------------------------------------------------
19B. NAME OF CONTRACTOR                   19C. DATE SIGNED      20B. UNITED STATES OF AMERICA             20C. DATE SIGNED

BY [SIGNATURE ILLEGIBLE]                                        BY [SIGNATURE ILLEGIBLE]
----------------------------------------                        ----------------------------------------
(SIGNATURE OF PERSON AUTHORIZED TO SIGN)                           (SIGNATURE OF CONTRACTING OFFICER)
------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-8069                                         26-107                                     STANDARD FORM 26 (REV. 4-85)
PREVIOUS EDITION UNUSABLE                                                                               PRESCRIBED BY GSA
                                                                                                        FAR (48 CFR) 53.214(a)
</TABLE>

<PAGE>

                                                                N00178-03-C-3079

                                                                    Page 2 of 27

SECTION A: SOLICITATION/CONTRACT FORM

CLAUSES INCORPORATED BY FULL TEXT

Ddl-A20 NOTICE TO CONTRACTORS

                              NOTICE TO CONTRACTORS

   THE PURPOSE OF THIS NOTICE IS TO BRING MATTERS TO YOUR ATTENTION WHICH CAN
                        AFFECT PAYMENT OF YOUR INVOICES.

CCR ANNUAL RENEWAL

YOU MUST CONFIRM YOUR REGISTRATION IN THE CENTRAL CONTRACTOR REGISTRATION (CCR)
DATABASE OR THE DEFENSE FINANCE AND ACCOUNTING SERVICE (DFAS) MAY NOT PROCESS
YOUR INVOICE. YOU MAY OBTAIN MORE INFORMATION ON THIS ANNUAL RENEWAL
CONFIRMATION PROCESS BY CALLING 1-888-227-2423 OR VIA THE INTERNET AT
HTTP://WWW.CCR2000.COM/

EFTS

ELECTRONIC FUNDS TRANSFER (EFT) PAYMENTS ARE BASED ON THE EFT INFORMATION
CONTAINED IN THE CCR DATABASE. IT IS CRITICAL THAT YOU ENSURE THAT YOUR EFT
INFORMATION IN THE CCR DATABASE REMAINS CURRENT AND CORRECT.

INVOICES

INVOICES MUST BE PREPARED AS PRESCRIBED BY THIS CONTRACT/ORDER OR
THEY MAY BE REJECTED BY THE PAYING OFFICE. THIS CONTRACT/ORDER
INCORPORATES ONE OR MORE OF THE FOLLOWING CLAUSES REGARDING
PREPARATION AND SUBMISSION OF INVOICES:

      FAR 52.212-4
      FAR 52.213-2
      FAR 52.232-25
      NAPS 5252.232-9000
      NAPS 5252.232-9001
      NAPS 5252.232-9002
      NAPS 5252.232-9003

<PAGE>

                                                                N00178-03-C-3079
                                                                    Page 3 of 27

PLEASE INSURE THAT INVOICES ARE PREPARED AND SUBMITTED IN ACCORDANCE WITH THESE
CLAUSES AND THE FOLLOWING ADDITIONAL INFORMATION:

      INVOICE PREPARATION - PLEASE ENSURE THAT YOUR INVOICE CLEARLY REFLECTS:

            (1) INVOICE NUMBER,
            (2) DATE OF INVOICE,
            (3) COMPANY NAME AND REMIT TO ADDRESS (COMPANY NAME ON THE INVOICE
                MUST MATCH THE COMPANY NAME ON THE CONTRACT/ORDER),
            (4) CONTRACT/ORDER NUMBER, AND
            (5) INVOICE AMOUNT.

      INVOICE SUBMISSION - IF A "SUBMIT TO" ADDRESS IS DESIGNATED IN ONE OF THE
      CLAUSES LISTED ABOVE, SUBMIT THE ORIGINAL AND THREE COPIES OF EACH INVOICE
      TO THAT ADDRESS AND SUBMIT ONE COPY TO THE ADDRESS SHOWN BELOW. IF THERE
      IS NO ADDRESS DESIGNATED IN ANY OF THE CLAUSES LISTED ABOVE, SUBMIT THE
      ORIGINAL AND THREE COPIES OF EACH INVOICE TO THE ADDRESS SHOWN BELOW. IN
      ADDITION, SUBMIT ONE COPY OF EACH INVOICE TO THE CONTRACT SPECIALIST AT
      THE ISSUING OFFICE ADDRESS SHOWN OF THE FACE OF THE DOCUMENT:

      NAVAL SURFACE WARFARE CENTER, DAHLGREN DIVISION
      ATTN: CODE J12/ROBERT BRANNON
      17320 DAHLGREN ROAD
      DAHLGREN, VA 22448-5100

REGISTER FOR INVOICE STATUS

YOU CAN REGISTER AT THE FOLLOWING WEB SITE TO MONITOR THE STATUS OF YOUR
INVOICES. THIS IS THE VENDOR PAY INQUIRY SYSTEM-MOCAS USER REGISTRATION.
HTTP://VENDORPAY.DFAS.MIL/NEWUSER

<PAGE>

                                                                N00178-03-C-3079
                                                                    Page 4 of 27

SECTION B SUPPLIES OR SERVICES AND PRICES

<TABLE>
<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>                  <C>                   <C>
                                                                                     $                     $
0001            Feasibility Study
                FFP - The contractor shall perform research and development efforts in
                accordance with the contractor's proposal dated 5 March 2002 in response to
                BAA number N00178-01-Q-3040
                PURCHASE REQUEST NUMBER J10000/30711858
                                                                                                  ----------------

                                                                                  NET AMT                  $

                ACRN AA Funded Amount

<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0001AA                                    1.00                  Lot             $32,000.00           $32,000.00
                Feasibility Study Monthly Status Report
                FFP - The contractor shall perform research and development efforts and
                provide the first Monthly Status Report in accordance with CDRL A00l.
                PURCHASE REQUEST NUMBER Jl0000/30711858
                                                                                                  ----------------

                                                                                  NET AMT            $32,000.00

<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0001AB                                    1.00                  Lot             $32,000.00           $32,000.00
                Feasibility Study Monthly Status Report
                FFP - The contractor shall perform research and development efforts and
                provide the second Monthly Status Report in accordance with CDRL A00l.
                PURCHASE REQUEST NUMBER J10000/30711858
                                                                                                  ----------------
                                                                                  NET AMT            $32,000.00

<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0001AC                                    1.00                  Lot             $32,000.00           $32,000.00
                Feasibility Study Monthly Status Report
                FFP - The contractor shall perform research and development efforts and
                provide the third Monthly Status Report in accordance with CDRL A001.
                PURCHASE REQUEST NUMBER J10000/30711858
                                                                                                  ----------------

                                                                                  NET AMT            $32,000.00
</TABLE>

<PAGE>

                                                                N00178-03-C-3079

                                                                    Page 5 of 27

<TABLE>
<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0001AD                                    1.00                  Lot             $32,000.00           $32,000.00
                Feasibility Study Monthly Status Report
                FFP - The contractor shall perform research and development efforts and
                provide the fourth Monthly Status Report in accordance with CDRL A001.
                PURCHASE REQUEST NUMBER J10000/30711858
                                                                                                  ----------------

                                                                                  NET AMT            $32,000.00

<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0001AE                                    1.00                  Lot             $32,000.00           $32,000.00
                Feasibility Study Monthly Status Report
                FFP - The contractor shall perform research and development efforts and
                provide the fifth Monthly Status Report in accordance with CDRL A001.
                PURCHASE REQUEST NUMBER J10000/30711858
                                                                                                  ----------------

                                                                                  NET AMT            $32,000.00

<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0001AF                                    1.00                  Lot             $34,988.39           $36,483.00
                Feasibility Study Monthly Status Report
                FFP - The contractor shall perform research and development efforts and
                provide the sixth Monthly Status Report in accordance with CDRL A001.
                PURCHASE REQUEST NUMBER J10000/30711858

                                                                                  NET AMT            $36,483.00

<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0002                                      1.00                  Lot                  $                  $NSP
                Data Deliverables
                FFP-The Contractor shall provide the data deliverables in support of CLIN
                0001.
                                                                                                  ----------------

                                                                                  NET AMT                  $
</TABLE>

<PAGE>

                                                                N00178-03-C-3079

                                                                    Page 6 of 27

<TABLE>
<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>                 <C>                    <C>
0003                                      1.00                  Lot                 $                      $
                Optional Prototype Development and Demonstration
                CPFF - The contractor shall perform research and development efforts in
                accordance with the contractor's proposal dated 8 March 2002 in response to
                BAA number N00178-01-Q-3040

                                                                                EST. COST           $730,992.00
                                                                                FIXED FEE             63,934.00
                                                                                                  ----------------
                                                                     TOTAL EST COST + FEE           $794,926.00

<CAPTION>
ITEM NO         SUPPLIES/SERVICES       QUANTITY                UNIT            UNIT PRICE              AMOUNT
<S>             <C>                       <C>                   <C>             <C>                  <C>
0004                                      1.00                  Lot                 $                   $NSP
               Data Deliverables
               CPFF - The Contractor shall provide the data deliverables and the
               Demonstration of Prototype Operation in support of CLIN 0002 in accordance
               with CDRLs A004, A005, and A006.
</TABLE>

CLAUSES INCORPORATED BY FULL TEXT

HQ B-2-0004 EXPEDITING CONTRACT CLOSEOUT (NAVSEA) (DEC 1995)

(a) As part of the negotiated fixed price or total estimated amount of this
contract, both the Government and the Contractor have agreed to waive any
entitlement that otherwise might accrue to either party in any residual dollar
amount of $500 or less at the time of final contract closeout. The term
"residual dollar amount" shall include all money that would otherwise be owed to
either party at the end of the contract, except that, amounts connected in any
way with taxation, allegations of fraud and/or antitrust violations shall be
excluded. For purposes of determining residual dollar amounts, offsets of money
owed by one party against money that would otherwise be paid by that party may
be considered to the extent permitted by law.

(b) This agreement to waive entitlement to residual dollar amounts has been
considered by both parties. It is agreed that the administrative costs for
either party associated with collecting such small dollar amounts could exceed
the amount to be recovered.

SECTION C DESCRIPTIONS AND SPECIFICATIONS

CLAUSES INCORPORATED BY FULL TEXT

Ddl-C21 COPYRIGHT OF COMPUTER SOFTWARE

<PAGE>

                                                                N00178-03-C-3079

                                                                    Page 7 of 27

The contractor shall: (1) apply for copyright registration of the computer
program code developed by the contractor, (2) place the copyright notice on the
screen, in addition to the diskettes and manuals produced, and (3) place, next
to the copyright notice, the additional phrase: "The U. S. Government has rights
as specified in contract N00178-03-C-3079".

Ddl-C40 INFORMATION SYSTEMS (IS) SECURITY AND ACCREDITATION

Contractor Provision of IS Resources

Except in special circumstances explicitly detailed elsewhere in this document,
the Contractor shall provide all IS resources needed in the performance of this
contract. IS resources include, but are not limited to, computers, software,
networks, and addresses.

Contractor Use of NSWCDD IS Resources

In the event that the contractor is required to have access to NSWCDD IS
resources, the login name (common id) and associated information shall be
registered with the NSWCDD site issuing authority.

If this contract requires that the contractor be granted access and use of
NSWCDD IS resources (at any site), the IS shall be accredited for contractor use
in accordance with procedures specified by the IS Security Office. The
accreditation shall include COR certification that the use and access is
required by this contract.

Connections Between NSWCDD and Contractor Facilities

If there is a requirement (specifically delineated elsewhere in this contract)
for interconnection between any facilities and/or ISs owned or operated by the
contractor, such interconnection shall take place only after approval from the
NSWCDD IS Security Office. All such connections as well as the ISs connected
thereto will be accredited (operated at an acceptable risk) by the appropriate
NSWCDD Designated Approving Authority (DAA) and comply with the requirements of
DODDIR 5200.28 regarding Memorandums of Agreement. All such connections will be
made outside the appropriate NSWCDD firewall.

Accreditation of Contractor-owned ISs

The Government reserves the right to have all contractor owned ISs used in the
performance of this contract accredited by the cognizant DAA.

Use of Contractor Personnel to Perform IS Security Tasking

General - Personnel performing IS security related tasking must have
successfully completed training and demonstrate proficiency in the following
areas: Information System Security Awareness, Security Domains, Incident
Handling, and Auditing Concepts.

Architecture Specific - Personnel assigned to perform IS security related
tasking for a specific area must be trained and demonstrate proficiency in that
area. Typical examples include, but are not limited to: networking, processing
classified information, Internet Protocols, Unix, Novell, and Microsoft
operating systems.

Replacement or New IS Security Personnel - The contractor shall provide evidence
that new and replacement IS personnel, unless they are Key Personnel, meet the
above requirements and forward such information to the COR for review and
approval by the Information Systems Security Office. Failure to meet the
requirements herein may result in rejection of the person or persons.
Replacement of IS personnel designated as Key Personnel will be in accordance
with the Key Personnel provision contained herein.

<PAGE>

                                                                N00178-03-C-3079

                                                                    Page 8 of 27

HQ C-2-0011 COMPUTER SOFTWARE AND/OR COMPUTER DATABASE(S) DELIVERED TO AND/OR
RECEIVED FROM THE GOVERNMENT (NAVSEA) (NOV 1996)

(a) The Contractor agrees to test for viruses all computer software and/or
computer databases, as defined in the clause entitled "RIGHTS IN NONCOMMERCIAL
COMPUTER SOFTWARE AND NONCOMMERCIAL COMPUTER SOFTWARE DOCUMENTATION" (DFARS
252.227-7014), before delivery of that computer software or computer database in
whatever media and on whatever system the software is delivered. The Contractor
warrants that any such computer software and/or computer database will be free
of viruses when delivered.

(b) The Contractor agrees to test any computer software and/or computer
database(s) received from the Government for viruses prior to use under this
contract.

(c) Unless otherwise agreed in writing, any license agreement governing the use
of any computer software to be delivered as a result of this contract must be
paid-up and perpetual, or so nearly perpetual as to allow the use of the
computer software or computer data base with the equipment for which it is
obtained, or any replacement equipment, for so long as such equipment is used.
Otherwise the computer software or computer data base does not meet the minimum
functional requirements of this contract. In the event there is any routine to
disable the computer software or computer data base in the future, that date
certain shall not be less than 25 years after the delivery date of the computer
software or computer database.

(d) No copy protection devices or systems shall be used in any computer software
or computer database delivered under this contract to restrict or limit the
Government from making copies. This does not prohibit license agreements from
specifying the maximum amount of copies that can be made.

(e) Delivery by the Contractor to the Government of certain technical data and
other data is now frequently required in digital form rather than as hard copy.
Such delivery may cause confusion between data rights and computer software
rights. It is agreed that, to the extent that any such data is computer software
by virtue of its delivery in digital form, the Government will be licensed to
use that digital-form data with exactly the same rights and limitations as if
the data had been delivered as hard copy.

(f) Any limited rights legends or other allowed legends placed by a Contractor
on technical data or other data delivered in digital form shall be digitally
included on the same media as the digital-form data and must be associated with
the corresponding digital-form technical data to which the legends apply to the
extent possible. Such legends shall also be placed in human-readable form on a
visible surface of the media carrying the digital-form data as delivered, to the
extent possible.

HQ C-2-0014 CONTRACTOR'S PROPOSAL (NAVSEA) (SEP 1990)

(a) Performance of this contract by the Contractor shall be conducted and
performed in accordance with detailed obligations to which the Contractor
committed itself in proposal titled "Chemical Agent Screener for Sealed
Containers" dated 5 March 2002 in response to Broad Agency Announcement No.
N00178-0l-Q-3040.

(b) The technical volume(s) of the Contractor's proposal is incorporated by
reference and hereby made subject to the provisions of the "ORDER OF PRECEDENCE"
(FAR 52.215-8) clause of this contract. Under the "ORDER OF PRECEDENCE" clause,
the technical volume of the Contractor's proposal referenced herein is hereby
designated as item (f) of the clause, following "the specification" in the order
of precedence.

<PAGE>

                                                                N00178-03-C-3079

                                                                    Page 9 of 27

SECTION D PACKAGING AND MARKING

CLAUSES INCORPORATED BY FULL TEXT

Ddl-D10 PREPARATION FOR SHIPMENT (COMMERCIALLY PACKAGED ITEMS)

Preservation, packaging, packing, and marking shall be in accordance with ASTM
Designation D 3951-95 "Standard Practice for Commercial Packaging."

Ddl-D12 UNPACKING INSTRUCTIONS: COMPLEX OR DELICATE EQUIPMENT

      (a) Location on Container. When practical, one set of the unpacking
instructions will be placed in a heavy water-proof envelope prominently marked
"UNPACKING INFORMATION" and firmly affixed to the outside of the shipping
container in a protected location, preferably between the cleats on the end of
the container adjacent to the identification marking. If the instructions cover
a set of equipment packed in multiple containers, the instructions will be
affixed to the number one container of the set. When the unpacking instructions
are too voluminous to be affixed to the exterior of the container, they will be
placed inside and directions for locating them will be provided in the envelope
marked "UNPACKING INFORMATION."

      (b) Marking Containers. When unpacking instructions are provided, shipping
containers will be stenciled "CAUTION--THIS EQUIPMENT MAY BE SERIOUSLY DAMAGED
UNLESS UNPACKING INSTRUCTIONS ARE CAREFULLY FOLLOWED. UNPACKING INSTRUCTIONS ARE
LOCATED (state where located)." When practical, this marking will be applied
adjacent to the identification marking on the side of the container.

SECTION E INSPECTION AND ACCEPTANCE

INSPECTION AND ACCEPTANCE TERMS

Supplies/services will be inspected/accepted at:

CLIN      INSPECT AT             INSPECT BY    ACCEPT AT              ACCEPT BY
0001      Destination            Government   Destination            Government
0001AA    Destination            Government   Destination            Government
0001AB    Destination            Government   Destination            Government
0001AC    Destination            Government   Destination            Government
0001AD    Destination            Government   Destination            Government
0001AE    Destination            Government   Destination            Government
0001AF    Destination            Government   Destination            Government
0002      Destination            Government   Destination            Government
0003      Destination            Government   Destination            Government
0004      Destination            Government   Destination            Government

CLAUSES INCORPORATED BY REFERENCE:

52.246-9        Inspection Of Research And Development (Short Form)     APR 1984
52.246-16       Responsibility For Supplies                             APR 1984
252.246-7000    Material Inspection And Receiving Report                DEC 1991

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 10 of 27

SECTION F DELIVERIES OR PERFORMANCE

DELIVERY INFORMATION

<TABLE>
<CAPTION>
CLINS    DELIVERY DATE                  UNIT OF ISSUE   QUANTITY  FOB           SHIP TO ADDRESS
<S>      <C>                            <C>             <C>       <C>           <C>
0001     POP Date of Award to                                                   N00178
         01 Oct 03                                                              NAVAL SURFACE WARFARE
                                                                                CENTER, DAHLGREN
                                                                                ROBERT BRANNON/J12/COR
                                                                                17320 DAHLGREN ROAD
                                                                                DAHLGREN VA 22448-5100
0001AA   35 Days ADC                    Lot             1.00      Dest.         Same as CLIN 0001
0001AB   65 Days ADC                    Lot             1.00      Dest.         Same as CLIN 0001
0001AC   95 Days ADC                    Lot             1.00      Dest.         Same as CLIN 0001
0001AD   125 Days ADC                   Lot             1.00      Dest.         Same as CLIN 0001
0001AE   155 Days ADC                   Lot             1.00      Dest.         Same as CLIN 0001
0001AF   155 Days ADC                   Lot             1.00      Dest.         Same as CLIN 0001
0002     Same as CLIN 0001              Lot             1.00      Dest.         Same as CLIN 0001
0003     18 Months After Exercise                                 Dest.         Same as CLIN 0001
         of Option
0004     18 Months After Exercise                                 Dest.         Same as CLIN 0001
         of Option
</TABLE>

CLAUSES INCORPORATED BY REFERENCE:

52.242-15       Stop Work Order (Aug 89) Alt I                          APR 1984
52.242-15       Stop-Work Order                                         AUG 1989
52.247-34       F.O.B. Destination                                      NOV 1991

CLAUSES INCORPORATED BY FULL TEXT

Ddl-F40 CONTRACTOR NOTICE REGARDING LATE DELIVERY

In the event the contractor anticipates or encounters difficulty in complying
with the contract delivery schedule or date, he/she shall immediately notify, in
writing, the Contracting Officer and the cognizant Contract Administration
Services Office, if assigned. The notice shall give the pertinent details;
however such notice shall not be construed as a waiver by the Government of any
contract delivery schedule, or of any rights or remedies provided by law or
under this contract.

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 11 of 27

SECTION G CONTRACT ADMINISTRATION DATA

ACCOUNTING AND APPROPRIATION DATA

AA              21 NA 2002 2050.0000 El 2002 08 8012 70000000000 25EA SCD40C WA
                18020 000087345
AMOUNT:         $196,483.00 (RDA)

FUNDING         JOB ORDER NO
ACRN: AA        W81W3G21548201 (Exp. 30 Sep 03)

CLAUSES INCORPORATED BY FULL TEXT

Ddl-G1 PAYMENT INSTRUCTIONS FOR MULTIPLE ACCOUNTING CLASSIFICATION CITATIONS

The payment office shall ensure that each payment under this contract is made in
accordance with the accounting classification reference numbers (ACRNs) shown on
each individual invoice. ACRNs are cited by the contractor on each invoice in
accordance with clause 5252.232-9000, 5252.232-9001, or 5252.232-9003, as
appropriate.

Ddl-G10 GOVERNMENT CONTRACT ADMINISTRATION POINTS-OF-CONTACT AND
RESPONSIBILITIES

1. PROCURING CONTRACTING OFFICER (PCO):

      (a)   Name:       William T. Armstrong
            Address:    Code XDS 13
                        Dahlgren Division
                        Naval Surface Warfare Center
                        17320 Dahlgren Road
                        Dahlgren, Virginia 22448-5100
            Phone: (540) 653-7765; FAX: (540) 653-6810
            E-mail: armstrongwt@nswc.navy.mil

      (b) PCO responsibilities are outlined in FAR 1.602-2. The PCO is the only
person authorized to approve changes in any of the requirements of this contract
or orders issued thereunder and, notwithstanding provisions contained elsewhere
in this contract, the said authority remains solely the PCO's. The contractor
shall not comply with any order, direction or request of Government personnel
unless it is issued in writing and signed by the Contracting Officer OR IS
PURSUANT TO SPECIFIC AUTHORITY OTHERWISE INCLUDED AS PART OF THIS CONTRACT. In
the event the contractor effects any change at the direction of any person other
than the PCO, the change will be considered to be unauthorized.

2. CONTRACT SPECIALIST:

      (a)   Name:       Doris G. Elliott
            Address:    Code XDS 13-2
                        Dahlgren Division
                        Naval Surface Warfare Center
                        17320 Dahlgren Road
                        Dahlgren, Virginia 22448-5100
            Phone: (540) 653-7765; FAX: (540) 653-6810

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 12 of 27

            E-mail: elliottdg@nswc.navy.mil

      (b) The Contract Specialist is the representative of the Contracting
Officer for all contractual matters.

3. CONTRACTING OFFICER'S REPRESENTATIVE(COR):

      (a)   Name:       Roger Boughton
            Address:    Code J12
                        Dahlgren Division
                        Naval Surface Warfare Center
                        17320 Dahlgren Road
                        Dahlgren, Virginia 22448-5100
            Phone: (540) 653-4882 FAX: (540) 653-4977
            E-mail: boughtonra@nswc.navy.mil

      (b) The COR is the PCO's appointed representative for technical matters.
The COR is not a contracting officer and does not have the authority to direct
the accomplishment of effort which is beyond the scope of the contract or to
otherwise change any contract requirements. An informational copy of the COR
appointment letter which provides a delineation of COR authority and
responsibilities is provided as an attachment to this contract.

4. ALTERNATE CONTRACTING OFFICER'S REPRESENTATIVE (ACOR):

      (a)   Name:       Robert Brannon
            Address:    Code J12
                        Dahlgren Division
                        Naval Surface Warfare Center
                        17320 Dahlgren Road
                        Dahlgren, Virginia 22448-5100
            Phone: (540) 653-6438
            E-mail:

      (b) The ACOR is responsible for COR responsibilities and functions in the
event that the COR is unavailable due to leave, illness, or other official
business. The ACOR is appointed by the PCO; a copy of the ACOR appointment is
provided as an attachment to this contract.

5. PAYING OFFICE

      (a)   Name:       United States Army Corps of Engineers (USACE)
                        Baltimore District (El)
                        c/o USACE Finance Center
            Address:    5722 Integrity Drive
                        Millington, TN 38054-5005
            Phone: (443) 479-5684

      (b) The Paying Office makes all payments under the contract.

Ddl-G12 POST-AWARD CONFERENCE

      (a) A Post-Award Conference with the successful offeror will be conducted
within 60 days after award of the contract. The conference will be held at the
address below:

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 13 of 27

            Location/Address: To Be Determined

      (b) The contractor will be given 5 working days notice prior to the date
of the conference by the COR, Mr. Robert Brannon.

      (c) The requirement for a post-award conference shall in no event
constitute grounds for excusable delay by the Contractor in performance of any
provisions in the contract.

Ddl-G40 PAYMENT, SELECTED ITEMS OF COST REIMBURSEMENT CONTRACTS

      (a) Travel Costs (Including Foreign Travel)

            (1) Air: The contractor shall, to the maximum extent practicable,
minimize overall travel costs by taking advantage of discounted airfare rates
available through advance purchase. Charges associated with itinerary changes
and cancellation under nonrefundable airline tickets are reimbursable as long as
the changes are driven by the work requirement.

            (2) Non-reimbursable Travel: The following travel shall not be
reimbursed hereunder: travel performed for personal convenience, daily travel to
and from work at the contractor's facility (i.e., designated work site) or to
and from NSWCDD when NSWCDD is the designated work site.

      (b) Training

The Government will not allow costs, nor reimburse costs associated with the
contractor training employees in an effort to attain and/or maintain minimum
personnel qualification requirements of this contract. Other training may be
approved on a case-by-case basis by the COR. Attendance at workshops or
symposiums is considered training for purposes of this clause.

      (c) General Purpose Office Equipment (GPOE) and Information Technology
(IT)

The cost of acquisition of GPOE and IT shall not be allowable as direct charges
to this contract. The contractor is expected to have the necessary facilities to
perform the requirements of this contract, including any necessary GPOE and IT.
GPOE means equipment normally found in a business office such as desks, chairs,
typewriters, calculators, file cabinets, etc. IT means any equipment or
interconnected system or subsystem of equipment that is used in the automatic
acquisition, storage, manipulation, movement, control, display, switching,
interchange, transmission, or reception of data or information. IT includes
computers, ancillary equipment, software, firmware and similar products,
services (including support services), and related resources.

Ddl-G41 PAYMENT OF FIXED FEE (COST PLUS FIXED FEE) (CLIN 0003)

      (a) Subject to the withholding provisions of this clause, and any other
adjustments required by other contract clauses, the fixed fee shall be paid in
installments.

      (b) The amount of each fee installment shall be billed at 10% of allowable
costs. This percentage reflects the ratio of total contract fixed fee to total
contract estimated cost.

      (c) In accordance with FAR 52.216-8 FIXED FEE in Section 1 of this
contract, the Contracting Officer has established a withholding of 15% of funded
fixed fee, not to exceed $100,000. The contractor's provisional payment vouchers
may invoice fee at the percentage cited in paragraph (b) above, up to 85% of the
funded fixed fee.

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 14 of 27

NAPS 5252.232-9000 SUBMISSION OF INVOICES (FIXED PRICE) (JUL 1992) (CLIN 0001)

      (a) "Invoice" as used in this clause does not include contractor requests
for progress payments.

      (b) The contractor shall submit original invoices with 3 copies to the
address identified in the contract award form SF 26-Block 10.

      (c) The use of copies of the Material Inspection and Receiving Report
(MIRR), DD Form 250, as an invoice is encouraged. DFARS Appendix F-306 provides
instructions for such use. Copies of the MIRR used as an invoice are in addition
to the standard distribution stated in DFARS F-401.

      (d) In addition to the requirements of the Prompt Payment clause of this
contract, the contractor shall cite on each invoice the contract line item
number (CLIN); the contract subline item number (SLIN), if applicable; the
accounting classification reference number (ACRN) as identified on the financial
accounting data sheets, and the payment terms.

      (e) The contractor shall prepare a separate invoice for each activity
designated to receive the supplies or services.

      (f) If acceptance is at origin, the contractor shall submit the MIRR or
other acceptance verification directly to the designated payment office. If
acceptance is at destination, the consignee will forward acceptance verification
to the designated payment office.

SUBMISSION OF INVOICES (COST-REIMBURSEMENT, TIME-AND-MATERIALS, LABOR-HOUR, OR
FIXED PRICE INCENTIVE) (JUL 1992) (CLIN 0003)

(a) "Invoice" as used in this clause includes contractor requests for interim
payments using public vouchers (SF 1034) but does not include contractor
requests for progress payments under fixed price incentive contracts.

(b)(i) In accordance with DFARS 242.803(b)(i)(c), the cognizant Defense Contract
Audit Agency (DCAA) auditor has authorized the contractor to submit interim
invoices directly to paying offices. This authorization does not extend to the
first and final invoices, which shall be submitted to the contract auditor at
the following address:

DCAA Boston Branch Office
101 Merrimac Street, Suite 820A
Boston, MA 02114

A copy of every invoice shall be provided to the individual listed below for
certification, at the address shown (if completed by the contracting officer):
      Naval Surface Warfare Center, Dahlgren Division
      Attn: Code J12/Robert Brannon
      17320 Dahlgren Road
      Dahlgren, VA 22448-5100

In addition, a copy of the final invoice shall be provided to the Administrative
Contracting Officer (ACO).

      (ii) Upon written notification to the contractor, DCAA may rescind its
authorization for the contractor to submit interim invoices directly to the
paying offices. Upon receipt of such written notice the contractor shall
immediately begin to submit all invoices to the contract auditor at the above
address.

      (iii) Notwithstanding (i) and (ii), when delivery orders are applicable,
invoices shall be segregated by individual order and submitted to the
address(es) specified in the order.

(c) Invoices requesting interim payments shall be submitted no more than once
every two weeks, unless another time period is specified in the Payments clause
of this contract. For indefinite delivery type contracts, interim payment
invoices shall be submitted no more than once every two weeks for each delivery
order. There shall be a lapse of no more than 14 calendar days between
performance and submission of an interim payment invoice.

(d) In addition to the information identified in the Prompt Payment clause
herein, each invoice shall contain the

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 15 of 27

following information, as applicable:

      (1) Contract line item number (CLIN)
      (2) Sublime item number (SLIN)
      (3) Accounting Classification Reference Number (ACRN)
      (4) Payment terms
      (5) Procuring activity
      (6) Date supplies provided or services performed
      (7) Costs incurred and allowable under the contract
      (8) Vessel (e.g., ship, submarine or other craft) or system for which
      supply/service is provided

(e) A DD Form 250, "Material Inspection and Receiving Report",

      _______ is required with each invoice submittal.
         X    is required only with the final invoice.
      _______ is not required.

(f) A Certificate of Performance
      _______ shall be provided with each invoice submittal.
         X    is not required.

(g) The Contractor's final invoice shall be identified as such, and shall list
all other invoices (if any) previously tendered under this contract.

(h) Costs of performance shall be segregated, accumulated and invoiced to the
appropriate ACRN categories to the extent possible. When such segregation of
costs by ACRN is not possible for invoices submitted with CLINS/SLINS with more
than one ACRN, an allocation ratio shall be established in the same ratio as the
obligations cited in the accounting data so that costs are allocated on a
proportional basis.

(i) When a vendor invoice for a foreign currency is provided as supporting
documentation, the Contractor shall identify the foreign currency and indicate
on the vendor invoice the rate of exchange on the date of payment by the
Contractor. The Contractor shall also attach a copy of the bank draft or other
suitable documents showing the rate of exchange. The contractor shall provide an
English translation if the vendor invoice is written in a foreign language.

SECTION H SPECIAL CONTRACT REQUIREMENTS

CLAUSES INCORPORATED BY FULL TEXT

Dd1-H10 EMPLOYMENT OF US GOVERNMENT PERSONNEL RESTRICTED

In performing this contract, the Contractor shall not use as a consultant or
employ (on either a full or part time basis) any active duty U.S. Government
personnel (civilian or military) without the prior written approval of the
Contracting Officer. Such approval may be given only in circumstances where it
is clear that no laws and no DoD or U.S. Government instructions, regulations,
or policies might possibly be contravened and no appearance of a conflict of
interest will result.

Ddl-H11 CHANGES IN KEY PERSONNEL

      (a) The Contractor agrees that a partial basis for award of this contract
is the list of key personnel proposed. Accordingly, the Contractor agrees to
assign to this contract those key persons whose resumes were

<PAGE>

                                                                N00178-0342-3079

                                                                   Page 16 of 27

submitted with the proposal necessary to fulfill the requirements of the
contract. No substitution shall be made without prior notification to and
concurrence of the Contracting Officer in accordance with this requirement.

      (b) The contractor agrees that during the first 180 days of the period of
performance no key personnel substitutions will be permitted unless such
substitutions are necessitated by an individual's sudden illness, death, or
termination of employment. All proposed substitutions shall have qualifications
equal to or higher than the qualifications of the person to be replaced. The
Contracting Officer shall be notified in writing of any proposed substitution at
least fifteen (15) days, or thirty (30) days if a security clearance is to be
obtained, in advance of the proposed substitution. Such notification shall
include:

            (1) An explanation of the circumstances necessitating the
      substitution;

            (2) A complete resume of the proposed substitute;

            (3) The hourly rates of the incumbent and the proposed substitute;
      and

            (4) Any other information requested by the Contracting Officer to
enable him/her to judge whether or not the Contractor is maintaining the same
high quality of personnel that provided the partial basis for award.

      (c) In the event a requirement to increase the specified level of effort
for a designated labor category, but not the overall level of effort of the
contract, occurs, the Contractor shall submit to the Contracting Officer a
written request for approval to add personnel to the designated labor category.
The same information as specified in paragraph (b) above is to be submitted with
the request.

      (d) The Contracting Officer shall evaluate requests for changes in
personnel and promptly notify the Contractor, in writing, whether the request is
approved or disapproved.

Ddl-H40 FUNDING PROFILE

It is estimated that these incremental funds will provide for CLIN 0003. The
following details funding to date:

Total
Contract                Funds This        Previous      Funds          Balance
CPFF                      Action          Funding       Available      Unfunded

$991,409.00                 *             $-0-             *              *

*TO BE SPECIFIED AT TIME OF AWARD OF OPTION

Ddl-H43 REQUIRED INSURANCE

      (a) The following types of insurance are required in accordance with the
clause entitled "INSURANCE - LIABILITY TO THIRD PERSONS" and shall be maintained
in the minimum amounts shown:

            (1) Comprehensive General Liability: $100,000 per person and
$500,000 per accident for bodily injury. No property damage general liability
insurance is required.

            (2) Automobile Insurance: $200,000 per person and $500,000 per
accident for bodily injury and $20,000 per accident for property damage.
Comprehensive form of policy is required.

            (3) Standard Workmen's Compensation and Employer's Liability
Insurance (or, where maritime employment is involved, Longshoremen's and Harbor
Worker's Compensation Insurance) in the minimum amount of $100,000.

      (b) The policies for such insurance shall contain an endorsement that
cancellation or material change in the policies, adversely affecting the
interest of the Government in such insurance, shall not be effective unless the
Contracting Officer approves such cancellation or change. When the coverage is
provided by self-insurance, prior approval of the Administrative Contracting
Officer is required for any change or decrease in coverage.

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 17 of 27

Ddl-H50 NOTICE OF INCORPORATION OF SECTION K

Section K of the solicitation (Representation, Certifications and Other
Statements of Offerors) will not be distributed with the contract; however, it
is incorporated in and forms a part of the resultant contract as though
furnished in full text therewith.

SEA 5252.232-9104 ALLOTMENT OF FUNDS (MAY 1993)

(a) This contract is incrementally funded with respect to both cost and fee. The
amount(s) presently available and allotted to this contract for payment of fee
for incrementally funded contract line item number/contract subline item number
(CLIN/SLIN), subject to the clause entitled "FIXED FEE" (FAR 52.216-8) or
"INCENTIVE FEE" (FAR 52.216-10), as appropriate, is specified below. The
amount(s) presently available and allotted to this contract for payment of cost
for incrementally funded CLINs/SLINs is set forth below. As provided in the
clause of this contract entitled "LIMITATION OF FUNDS" (FAR 52.232-22), the
CLINs/SLINs covered thereby, and the period of performance for which it is
estimated the allotted amount(s) will cover are as follows:

                                                                 ESTIMATED
ITEM(S)         ALLOTTED TO COST      ALLOTTED TO FEE      PERIOD OF PERFORMANCE
-------         ----------------      ---------------      ---------------------

0003,0004            $                    $

(b) The parties contemplate that the Government will allot additional amounts to
this contract from time to time for the incrementally funded CLINs/SLINs by
unilateral contract modification, and any such modification shall state
separately the amount(s) allotted for cost, the amount(s) allotted for fee, the
CLINs/SLINs covered thereby, and the period of performance which the amount(s)
are expected to cover.

(c) CLINs/SLINs _ are fully funded and performance under these CLINs/SLINs is
subject to the clause of this contract entitled "LIMITATION OF COST" (FAR
52.232-20) or "LIMITATION OF COST (FACILITIES)" (FAR 52.232-21), as applicable.

(d) The Contractor shall segregate costs for the performance of incrementally
funded CLINs/SLINs from the costs of performance of fully funded CLINs/SLINs.

HQ B-2-0007 LIMITATION OF COST OR LIMITATION OF FUNDS LANGUAGE

The clause entitled "LIMITATION OF COST" (FAR 52.232-20) or "LIMITATION OF
FUNDS" (FAR 52.232-22), as appropriate, shall apply separately and independently
to each separately identified estimated cost.

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 18 of 27

SECTION I CONTRACT CLAUSES

CLAUSES INCORPORATED BY REFERENCE:

<TABLE>
<CAPTION>
<S>                     <C>                                                                     <C>
52.202-1                Definitions                                                             DEC 2001
52.203-3                Gratuities                                                              APR 1984
52.203-5                Covenant Against Contingent Fees                                        APR 1984
52.203-6                Restrictions On Subcontractor Sales To The Government                   JUL 1995
52.203-7                Anti-Kickback Procedures                                                JUL 1995
52.203-8                Cancellation, Rescission, and Recovery of Funds for Illegal or          JAN 1997
                        Improper Activity
52.203-10               Price Or Fee Adjustment For Illegal Or Improper Activity                JAN 1997
52.203-12               Limitation On Payments To Influence Certain Federal Transactions        JUN 1997
52.204-4                Printed or Copied Double-Sided on Recycled Paper                        AUG 2000
52.209-6                Protecting the Government's Interest When Subcontracting With           JUL 1995
                        Contractors Debarred, Suspended, or Proposed for Debarment
52.211-15               Defense Priority And Allocation Requirements                            SEP 1990
52.215-2                Audit and Records--Negotiation                                          JUN 1999
52.215-8                Order of Precedence--Uniform Contract Format                            OCT 1997
52.215-17               Waiver of Facilities Capital Cost of Money                              OCT 1997
52.215-21               Requirements for Cost or Pricing Data or Information Other Than         OCT 1997
                        Cost or Pricing Data--Modifications
52.216-7                Allowable Cost And Payment                                              FEB 2002
52.216-8                Fixed Fee                                                               MAR 1997
52.219-8                Utilization of Small Business Concerns                                  OCT 2000
52.222-3                Convict Labor                                                           AUG 1996
52.222-21               Prohibition Of Segregated Facilities                                    FEB 1999
52.222-26               Equal Opportunity                                                       APR 2002
52.222-35               Equal Opportunity For Special Disabled Veterans, Veterans of the        DEC 2001
                        Vietnam Era and Other Eligible Veterans
52.222-36               Affirmative Action For Workers With Disabilities                        JUN 1998
52.222-37               Employment Reports On Special Disabled Veterans, Veterans Of            DEC 2001
                        The Vietnam Era and Other Eligible Veterans
52.223-6                Drug Free Workplace                                                     MAY 2001
52.225-13               Restrictions on Certain Foreign Purchases                               JUL 2000
52.227-1 Alt I          Authorization And Consent (Jul 1995) - Alternate I                      APR 1984
52.227-2                Notice and Assistance Regarding Patent and Copyright
                        Infringement                                                            AUG 1986
52.228-7                Insurance--Liability To Third Persons                                   MAR 1996
52.229-3                Federal, State And Local Taxes                                          JAN 1991
52.232-2                Payments Under Fixed-Price Research And Development Contracts           APR 1984
52.232-17               Interest                                                                JUN 1996
52.232-20               Limitation of Cost                                                      APR 1984
52.232-22               Limitation Of Funds                                                     APR 1984
52.232-23               Assignment Of Claims                                                    JAN 1986
52.232-25               Prompt Payment                                                          FEB 2002
52.232-33               Payment by Electronic Funds Transfer--Central Contractor                MAY 1999
                        Registration
52.233-1                Disputes                                                                DEC 1998
52.233-1 Alt I          Disputes (Dec 1998) - Alternate 1                                       DEC 1991
52.233-3 Alt I          Protest After Award (Aug 1996) - Alternate I                            JUN 1985
52.242-1                Notice of Intent to Disallow Costs                                      APR 1984
52.242-3                Penalties for Unallowable Costs                                         MAY 2001
52.242-4                Certification of Final Indirect Costs                                   JAN 1997
52.242-13               Bankruptcy                                                              JUL 1995
52.243-1 Alt V          Changes--Fixed-Price (Aug 1987) - Alternate V                           APR 1984
52.243-2 Alt V          Changes--Cost-Reimbursement (Aug 1987) - Alternate V                    APR 1984
52.244-2 Alt I          Subcontracts (Aug 1998) -  Alternate 1                                  AUG 1998
52.244-6                Subcontracts for Commercial Items                                       MAY 2002
52.249-2                Termination For Convenience Of The Government (Fixed-Price)             SEP 1996
</TABLE>

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                                                                N00178-03-C-3079

                                                                   Page 19 of 27

<TABLE>
<S>                     <C>                                                                     <C>
52.249-6                Termination (Cost Reimbursement)                                        SEP 1996
52.249-9                Default (Fixed-Priced Research And Development)                         APR 1984
52.249-14               Excusable Delays                                                        APR 1984
52.253-1                Computer Generated Forms                                                JAN 1991
252.201-7000            Contracting Officer's Representative                                    DEC 1991
252.203-7001            Prohibition On Persons Convicted of Fraud or Other Defense-             MAR 1999
                        Contract-Related Felonies
252.204.7000            Disclosure of Information                                               DEC 1991
252.204-7003            Control Of Government Personnel Work Product                            APR 1992
252.204-7004            Required Central Contractor Registration                                NOV 2001
252.205-7000            Provisions Of Information To Cooperative Agreement Holders              DEC 1991
252.209-7000            Acquisition From Subcontractors Subject To On-Site Inspection           NOV 1995
                        Under The Intermediate Range Nuclear Forces (INF) Treaty
252.209-7004            Subcontracting With Firms That Are Owned or Controlled By The           MAR 1998
                        Government of a Terrorist Country
252.225-7012            Preference for Certain Domestic Commodities                             APR 2002
252.225-7026            Reporting Of Contract Performance Outside The United States             JUN 2000
252.226-7001            Utilization of Indian Organizations and Indian-Owned Economic           SEP 2001
                        Enterprises-DoD Contracts
252.227-7013            Rights in Technical Data -- Noncommercial Items                         NOV 1995
252.227-7014            Rights in Noncommercial Computer Software and Noncommercial             JUN 1995
                        Computer Software Documentation
252.227-7016            Rights in Bid or Proposal Information                                   JUN 1995
252.231-7000            Supplemental Cost Principles                                            DEC 1991
252.243-7001            Pricing Of Contract Modifications                                       DEC 1991
252.243-7002            Requests for Equitable Adjustment                                       MAR 1998
252.247-7023            Transportation of Supplies by Sea                                       MAR 2000
252.247-7024            Notification Of Transportation Of Supplies By Sea                       MAR 2000
</TABLE>

CLAUSES INCORPORATED BY FULL TEXT

52.217-9 OPTION TO EXTEND THE TERM OF THE CONTRACT (MAR 2000)

      (a)   The Government may extend the term of this contract by written
            notice to the Contractor within 180 days; provided that the
            Government gives the Contractor a preliminary written notice of its
            intent to extend at leas 60 days before the contract expires. The
            preliminary notice does not commit the Government to an extension.
      (b)   If the Government exercises this option, the extended contract shall
            be considered to include this option clause.
      (c)   The total duration of this contract, including the exercise of any
            options under this clause, shall not exceed 18 months.

52.222-2 PAYMENT FOR OVERTIME PREMIUMS (JUL 1990)

(a) The use of overtime is authorized under this contract if the overtime
premium cost does not exceed $--0-- or the overtime premium is paid for work --

(1) Necessary to cope with emergencies such as those resulting from accidents,
natural disasters, breakdowns of production equipment, or occasional production
bottlenecks of a sporadic nature;

(2) By indirect-labor employees such as those performing duties in connection
with administration, protection, transportation, maintenance, standby plant
protection, operation of utilities, or accounting;

(3) To perform tests, industrial processes, laboratory procedures, loading or
unloading of transportation conveyances, and operations in flight or afloat that
are continuous in nature and cannot reasonably be interrupted or

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 20 of 27

completed otherwise; or

(4) That will result in lower overall costs to the Government.

(b) Any request for estimated overtime premiums that exceeds the amount
specified above shall include all estimated overtime for contract completion and
shall--

(1) Identify the work unit; e.g., department or section in which the requested
overtime will be used, together with present workload, staffing, and other data
of the affected unit sufficient to permit the Contracting Officer to evaluate
the necessity for the overtime;

(2) Demonstrate the effect that denial of the request will have on the contract
delivery or performance schedule;

(3) Identify the extent to which approval of overtime would affect the
performance or payments in connection with other Government contracts, together
with identification of each affected contract; and

(4) Provide reasons why the required work cannot be performed by using
multishift operations or by employing additional personnel.

52.227-1l PATENT RIGHTS--RETENTION BY THE CONTRACTOR (SHORT FORM) (JUN 1997)

(a) Definitions.

(1) "Invention" means any invention or discovery which is or may be patentable
or otherwise protectable under title 35 of the United States Code, or any novel
variety of plant which is or may be protected under the Plant Variety Protection
Act (7 U.S.C. 2321, et seq.).

(2) "Made" when used in relation to any invention means the conception or first
actual reduction to practice of such invention.

(3) "Nonprofit organization" means a university or other institution of higher
education or an organization of the type described in section 501(c)(3) of the
Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and exempt from taxation under
section 501(a) of the Internal Revenue Code (26 U.S.C. 501(a)) or any nonprofit
scientific or educational organization qualified under a state nonprofit
organization statute.

(4) "Practical application" means to manufacture, in the case of a composition
of product; to practice, in the case of a process or method, or to operate, in
the case of a machine or system; and, in each case, under such conditions as to
establish that the invention is being utilized and that is benefits are, to the
extent permitted by law or Government regulations, available to the public on
reasonable terms.

(5) "Small business firm" means a small business concern as defined at section 2
of Pub. L. 85-536 (15 U.S.C. 632) and implementing regulations of the
Administrator of the Small Business Administration. For the purpose of this
clause, the size standards for small business concerns involved in Government
procurement and subcontracting at 13 CFR 121.3-8 and 13 CFR 121.3-12,
respectively, will be used.

(6) "Subject invention" means any invention of the contractor conceived or first
actually reduced to practice in the performance of work under this contract,
provided that in the case of a variety of plant, the date of determination (as
defined in section 41(d) of the Plant Variety Protection Act, 7 U.S.C. 2401(d))
must also occur during the period of contract performance.

(b) Allocation of principal rights. The Contractor may retain the entire right,
title, and interest throughout the world to each subject invention subject to
the provisions of this clause and 35 U.S.C. 203. With respect to any subject
invention in which the Contractor retains title, the Federal Government shall
have a nonexclusive, nontransferable, irrevocable, paid-up license to practice
or have practiced for or on behalf of the United States the subject invention
throughout the world.

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                                                                N00l78-03-C-3079

                                                                   Page 21 of 27

(c) Invention disclosure, election of title, and filing of patent application by
Contractor. (1) The Contractor will disclose each subject invention to the
Federal agency within 2 months after the inventor discloses it in writing to
Contractor personnel responsible for patent matters. The disclosure to the
agency shall be in the form of a written report and shall identify the contract
under which the invention was made and the inventor(s). It shall be sufficiently
complete in technical detail to convey a clear understanding to the extent known
at the time of the disclosure, of the nature, purpose, operation, and the
physical, chemical, biological or electrical characteristics of the invention.
The disclosure shall also identify any publication, on sale or public use of the
invention and whether a manuscript describing the invention has been submitted
for publication and, if so, whether it has been accepted for publication at the
time of disclosure. In addition, after disclosure to the agency, the Contractor
will promptly notify the agency of the acceptance of any manuscript describing
the invention for publication or of any on sale or public use planned by the
Contractor.

(2) The Contractor will elect in writing whether or not to retain title to any
such invention by notifying the Federal agency within 2 years of disclosure to
the Federal agency. However, in any case where publication, on sale or public
use has initiated the 1-year statutory period wherein valid patent protection
can still be obtained in the United States, the period for election of title may
be shortened by the agency to a date that is no more than 60 days prior to the
end of the statutory period.

(3) The Contractor will file its initial patent application on a subject
invention to which it elects to retain title within 1 year after election of
title or, if earlier, prior to the end of any statutory period wherein valid
patent protection can be obtained in the United States after a publication, on
sale, or public use. The Contractor will file patent applications in additional
countries or international patent offices within either 10 months of the
corresponding initial patent application or 6 months from the date permission is
granted by the Commissioner of Patents and Trademarks to file foreign patent
applications where such filing has been prohibited by a Secrecy Order.

(4) Requests for extension of the time for disclosure election, and filing under
subparagraphs (c)(1), (2), and (3) of this clause may, at the discretion of the
agency, be granted.

(d) Conditions when the Government may obtain title. The Contractor will convey
to the Federal agency, upon written request, title to any subject invention--

(1) If the Contractor fails to disclose or elect title to the subject invention
within the times specified in paragraph (c) of this clause, or elects not to
retain title; provided, that the agency may only request title within 60 days
after learning of the failure of the Contractor to disclose or elect within the
specified times.

(2) In those countries in which the Contractor fails to file patent applications
within the times specified in paragraph (c) of this clause; provided, however,
that if the Contractor has filed a patent application in a country after the
times specified in paragraph (c) of this clause, but prior to its receipt of the
written request of the Federal agency, the Contractor shall continue to retain
title in that country.

(3) In any country in which the Contractor decides not to continue the
prosecution of any application for, to pay the maintenance fees on, or defend in
reexamination or opposition proceeding on, a patent on a subject invention.

(e) Minimum rights to Contractor and protection of the Contractor right to file.
(1) The Contractor will retain a nonexclusive royalty-free license throughout
the world in each subject invention to which the Government obtains title,
except if the Contractor fails to disclose the invention within the times
specified in paragraph (c) of this clause. The Contractor's license extends to
its domestic subsidiary and affiliates, if any, within the corporate structure
of which the Contractor is a party and includes the right to grant sublicenses
of the same scope to the extent the Contractor was legally obligated to do so at
the time the contract was awarded. The license is transferable only with the
approval of the Federal agency, except when transferred to the successor of that
part of the Contractor's business to which the invention pertains.

(2) The Contractor's domestic license may be revoked or modified by the funding
Federal agency to the extent necessary to achieve expeditious practical
application of subject invention pursuant to an application for an exclusive
license submitted in accordance with applicable provisions at 37 CFR Part 404
and agency licensing

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 22 of 27

regulations (if any). This license will not be revoked in that field of use or
the geographical areas in which the Contractor has achieved practical
application and continues to make the benefits of the invention reasonably
accessible to the public. The license in any foreign country may be revoked or
modified at the discretion of the funding Federal agency to the extent the
Contractor, its licensees, or the domestic subsidiaries or affiliates have
failed to achieve practical application in that foreign country.

(3) Before revocation or modification of the license, the funding Federal agency
will furnish the Contractor a written notice of its intention to revoke or
modify the license, and the Contractor will be allowed 30 days (or such other
time as may be authorized by the funding Federal agency for good cause shown by
the Contractor) after the notice to show cause why the license should not be
revoked or modified. The Contractor has the right to appeal, in accordance with
applicable regulations in 37 CFR Part 404 and agency regulations, if any,
concerning the licensing of Government-owned inventions, any decision concerning
the revocation or modification of the license.

(f) Contractor action to protect the Government's interest. (1) The Contractor
agrees to execute or to have executed and promptly deliver to the Federal agency
all instruments necessary to (i) establish or confirm the rights the Government
has throughout the world in those subject inventions to which the Contractor
elects to retain title, and (ii) convey title to the Federal agency when
requested under paragraph (d) of this clause and to enable the Government to
obtain patent protection throughout the world in that subject invention.

(2) The Contractor agrees to require, by written agreement, its employees, other
than clerical and nontechnical employees, to disclose promptly in writing to
personnel identified as responsible for the administration of patent matters and
in a format suggested by the Contractor each subject invention made under
contract in order that the Contractor can comply with the disclosure provisions
of paragraph (c) of this clause, and to execute all papers necessary to file
patent applications on subject inventions and to establish the Government's
rights in the subject inventions. This disclosure format should require, as a
minimum, the information required by subparagraph (c)(1) of this clause. The
Contractor shall instruct such employees, through employee agreements or other
suitable educational programs, on the importance of reporting inventions in
sufficient time to permit the filing of patent applications prior to U.S. or
foreign statutory bars.

(3) The Contractor will notify the Federal agency of any decisions not to
continue the prosecution of a patent application, pay maintenance fees, or
defend in a reexamination or opposition proceeding on a patent, in any country,
not less than 30 days before the expiration of the response period required by
the relevant patent office.

(4) The Contractor agrees to include, within the specification of any United
States patent application and any patent issuing thereon covering a subject
invention, the following statement, "This invention was made with Government
support under (identify the contract) awarded by (identify the Federal agency).
The Government has certain rights in the invention."

(g) Subcontracts. (1) The Contractor will include this clause, suitably modified
to identify the parties, in al subcontracts, regardless of tier, for
experimental, developmental, or research work to be performed by a small
business firm or domestic nonprofit organization. The subcontractor will retain
all rights provided for the Contractor in this clause, and the Contractor will
not, as part of the consideration for awarding the subcontract, obtain rights in
the subcontractor's subject inventions.

(2) The Contractor will include in all other subcontracts, regardless of tier,
for experimental, developmental, or research work the patent rights clause
required by Subpart 27.3.

(3) In the case of subcontracts, at any tier, the agency, subcontractor, and the
Contractor agree that the mutual obligations of the parties created by this
clause constitute a contract between the subcontractor and the Federal agency
with respect to the matters covered by the clause; provided, however, that
nothing in this paragraph is intended to confer any jurisdiction under the
Contract Disputes Act in connection with proceedings under paragraph (j) of this
clause.

(h) Reporting on utilization of subject inventions. The Contractor agrees to
submit, on request, periodic reports no more frequently than annually on the
utilization of a subject invention or on efforts at obtaining such utilization
that

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 23 of 27

are being made by the Contractor or its licensees or assignees. Such reports
shall include information regarding the status of development, date of first
commercial sale or use, gross royalties received by the Contractor, and such
other data and information as the agency may reasonably specify. The Contractor
also agrees to provide additional reports as may be requested by the agency in
connection with any march-in proceeding undertaken by the agency in accordance
with paragraph (j) of this clause. As required by 35 U.S.C. 202(c)(5), the
agency agrees it will not disclose such information to persons outside the
Government without permission of the Contractor.

(i) Preference for United States industry. Notwithstanding any other provision
of this clause, the Contractor agrees that neither it nor any assignee will
grant to any person the exclusive right to use or sell any subject invention in
the United States unless such person agrees that any product embodying the
subject invention or produced through the use of the subject invention will be
manufactured substantially in the United States. However, in individual cases,
the requirement for such an agreement may be waived by the Federal agency upon a
showing by the Contractor or its assignee that reasonable but unsuccessful
efforts have been made to grant licenses on similar terms to potential licensees
that would be likely to manufacture substantially in the United States or that
under the circumstances domestic manufacture is not commercially feasible.

(j) March-in rights. The Contractor agrees that, with respect to any subject
invention in which it has acquired title, the Federal agency has the right in
accordance with the procedures in 37 CFR 401.6 and any supplemental regulations
of the agency to require the Contractor, an assignee or exclusive licensee of a
subject invention to grant a nonexclusive, partially exclusive, or exclusive
license in any field of use to a responsible applicant or applicants, upon terms
that are reasonable under the circumstances, and if the Contractor, assignee, or
exclusive licensee refuses such a request the Federal agency has the right to
grant such a license itself if the Federal agency determines that--

(1) Such action is necessary because the Contractor or assignee has not taken,
or is not expected to take within a reasonable time, effective steps to achieve
practical application of the subject invention in such field of use;

(2) Such action is necessary to alleviate health or safety needs which are not
reasonably satisfied by the Contractor, assignee, or their licensees;

(3) Such action is necessary to meet requirements for public use specified by
Federal regulations and such requirements are not reasonably satisfied by the
Contractor, assignee, or licensees; or

(4) Such action is necessary because the agreement required by paragraph (i) of
this clause has not been obtained or waived or because a licensee of the
exclusive right to use or sell any subject invention in the United States is in
breach of such agreement.

(k) Special provisions for contracts with nonprofit organizations. If the
Contractor is a nonprofit organization, it agrees that--

(1) Rights to a subject invention in the United States may not be assigned
without the approval of the Federal agency, except where such assignment is made
to an organization which has as one of its primary functions the management of
inventions; provided, that such assignee will be subject to the same provisions
as the Contractor;

(2) The Contractor will share royalties collected on a subject invention with
the inventor, including Federal employee co-inventors (when the agency deems it
appropriate) when the subject invention is assigned in accordance with 35 U.S.C.
202(e) and 37 CFR 401.10;

(3) The balance of any royalties or income earned by the Contractor with respect
to subject inventions, after payment of expenses (including payments to
inventors) incidental to the administration of subject inventions will be
utilized for the support of scientific research or education; and

(4) It will make efforts that are reasonable under the circumstances to attract
licensees of subject inventions that are small business firms, and that it will
give a preference to a small business firm when licensing a subject invention if
the Contractor determines that the small business firm has a plan or proposal
for marketing the invention which, if executed, is equally as likely to bring
the invention to practical application as any plans or proposals from applicants

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 24 of 27

that are not small business firms; provided, that the Contractor is also
satisfied that the small business firm has the capability and resources to carry
out its plan or proposal. The decision whether to give a preference in any
specific case will be at the discretion of the contractor. However, the
Contractor agrees that the Secretary of Commerce may review the Contractor's
licensing program and decisions regarding small business applicants, and the
Contractor will negotiate changes to its licensing policies, procedures, or
practices with the Secretary of Commerce when the Secretary's review discloses
that the Contractor could take reasonable steps to more effectively implement
the requirements of this subparagraph (k)(4).

(l) Communications.

The contractor shall report inventions in accordance with DFARS 252.227-7039
incorporated by reference in this contract.

52.244-2 SUBCONTRACTS (AUG 1998)

(a) Definitions. As used in this clause--

Approved purchasing system means a Contractor's purchasing system that has been
reviewed and approved in accordance with Part 44 of the Federal Acquisition
Regulation (FAR).

Consent to subcontract means the Contracting Officer's written consent for the
Contractor to enter into a particular subcontract.

Subcontract means any contract, as defined in FAR Subpart 2.1, entered into by a
subcontractor to furnish supplies or services for performance of the prime
contract or a subcontract. It includes, but is not limited to, purchase orders,
and changes and modifications to purchase orders.

(b) This clause does not apply to subcontracts for special test equipment when
the contract contains the clause at FAR 52.245-18, Special Test Equipment.

(c) When this clause is included in a fixed-price type contract, consent to
subcontract is required only on unpriced contract actions (including unpriced
modifications or unpriced delivery orders), and only if required in accordance
with paragraph (d) or (e) of this clause.

(d) If the Contractor does not have an approved purchasing system, consent to
subcontract is required for any subcontract that--

(1) Is of the cost-reimbursement, time-and-materials, or labor-hour type; or

(2) Is fixed-price and exceeds--

(i) For a contract awarded by the Department of Defense, the Coast Guard, or the
National Aeronautics and Space Administration, the greater of the simplified
acquisition threshold or 5 percent of the total estimated cost of the contract;
or

(ii) For a contract awarded by a civilian agency other than the Coast Guard and
the National Aeronautics and Space Administration, either the simplified
acquisition threshold or 5 percent of the total estimated cost of the contract.

(e) If the Contractor has an approved purchasing system, the Contractor
nevertheless shall obtain the Contracting Officer's written consent before
placing the following subcontracts:

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 25 of 27

(f)(1) The Contractor shall notify the Contracting Officer reasonably in advance
of placing any subcontract or modification thereof for which consent is required
under paragraph (c), (d), or (e) of this clause, including the following
information:

(i) A description of the supplies or services to be subcontracted.

(ii) Identification of the type of subcontract to be used.

(iii) Identification of the proposed subcontractor.

(iv) The proposed subcontract price.

(v) The subcontractor's current, complete, and accurate cost or pricing data and
Certificate of Current Cost or Pricing Data, if required by other contract
provisions.

(vi) The subcontractor's Disclosure Statement or Certificate relating to Cost
Accounting Standards when such data are required by other provisions of this
contract.

(vii) A negotiation memorandum reflecting--

(A) The principal elements of the subcontract price negotiations;

(B) The most significant considerations controlling establishment of initial or
revised prices;

(C) The reason cost or pricing data were or were not required;

(D) The extent, if any, to which the Contractor did not rely on the
subcontractor's cost or pricing data in determining the price objective and in
negotiating the final price;

(E) The extent to which it was recognized in the negotiation that the
subcontractor's cost or pricing data were not accurate, complete, or current;
the action taken by the Contractor and the subcontractor; and the effect of any
such defective data on the total price negotiated;

(F) The reasons for any significant difference between the Contractor's price
objective and the price negotiated; and

(G) A complete explanation of the incentive fee or profit plan when incentives
are used. The explanation shall identify each critical performance element,
management decisions used to quantify each incentive element, reasons for the
incentives, and a summary of all trade-off possibilities considered.

(2) The Contractor is not required to notify the Contracting Officer in advance
of entering into any subcontract for which consent is not required under
paragraph (c), (d), or (e) of this clause.

(g) Unless the consent or approval specifically provides otherwise, neither
consent by the Contracting Officer to any subcontract nor approval of the
Contractor's purchasing system shall constitute a determination--

(1) Of the acceptability of any subcontract terms or conditions;

(2) Of the allowability of any cost under this contract; or

(3) To relieve the Contractor of any responsibility for performing this
contract.

(h) No subcontract or modification thereof placed under this contract shall
provide for payment on a cost-plus-a-percentage-of-cost basis, and any fee
payable under cost-reimbursement type subcontracts shall not exceed the fee
limitations in FAR 15.404-4(c)(4)(i).

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 26 of 27

(i) The Contractor shall give the Contracting Officer immediate written notice
of any action or suit filed and prompt notice of any claim made against the
Contractor by any subcontractor or vendor that, in the opinion of the
Contractor, may result in litigation related in any way to this contract, with
respect to which the Contractor may be entitled to reimbursement from the
Government.

(j) The Government reserves the right to review the Contractor's purchasing
system as set forth in FAR Subpart 44.3.

(k) Paragraphs (d) and (f) of this clause do not apply to the following
subcontracts, which were evaluated during negotiations:

Dr. Larry Marsteller
6510 East Carondelet Drive
Tucson, AZ 85710

52.252-2 CLAUSES INCORPORATED BY REFERENCE (FEB 1998)

This contract incorporates one or more clauses by reference, with the same force
and effect as if they were given in full text. Upon request, the Contracting
Officer will make their full text available. Also, the full text of a clause may
be accessed electronically at this/these address(es):

HTTP://FARSITE.HILL.AF.MIL

52.252-6 AUTHORIZED DEVIATIONS IN CLAUSES (APR 1984)

(a) The use in this solicitation or contract of any Federal Acquisition
Regulation (48 CFR Chapter 1) clause with an authorized deviation is indicated
by the addition of "(DEVIATION)" after the date of the clause.

(b) The use in this solicitation or contract of any Department of Defense FAR
Supplement (48 CFR Chapter 2) clause with an authorized deviation is indicated
by the addition of "(DEVIATION)" after the name of the regulation.

252.235-7010 Acknowledgment of Support and Disclaimer. (MAY 1995)

(a) The Contractor shall include an acknowledgment of the Government's support
in the publication of any material based on or developed under this contract,
stated in the following terms: This material is based upon work supported by the
Naval Surface Warfare Center, Dahlgren Division under Contract No.
N00178-03-C-3079.

(b) All material, except scientific articles or papers published in scientific
journals, must, in addition to any notices or disclaimers by the Contractor,
also contain the following disclaimer: Any opinions, findings and conclusions or
recommendations expressed in this material are those of the author(s) and do not
necessarily reflect the views of the Naval Surface Warfare Center, Dahlgren
Division.

252.235-7011 Final Scientific or Technical Report (SEP 1999)

The Contractor shall submit two copies of the approved scientific or technical
report delivered under this contract to the Defense Technical Information Center
(DTIC), Attn: DTIC-)OC, 8725 John J. Kingman Road, Suite 0944, Fort Belvoir, VA
22060-6218. The Contractor shall include a completed Standard Form 298, Report
Documentation Page, with each copy of the report. For submission of reports in
other than paper copy, contract the Defense Technical Information Center, Attn:
DTIC-OC, 8725 John J. Kingman Road, Suite 0944, Fort Belvoir, VA 22060-6218.

<PAGE>

                                                                N00178-03-C-3079

                                                                   Page 27 of 27

SECTION J LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACHMENTS

CLAUSES INCORPORATED BY FULL TEXT

Ddl-J10 LIST OF ATTACHMENTS

Attachment J.1 -- Contract Data Requirements List, DD1423

Attachment J.2 -- Contracting Officer's Representative Appointment Letter

<PAGE>

<TABLE>
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                         CONTRACT DATA REQUIREMENTS LIST                                        FORM APPROVED
                                  (1 DATA ITEM)                                                 OMB NO. 0704-0188
------------------------------------------------------------------------------------------------------------------------------------
Public reporting burden for this collection of information is estimated to average 110 hours per response, including the time
for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing
the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to Department of Defense, Washington Headquarters Services, Directorate for
Information Operations and Reports, 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302, and to the Office Management
and Budget, Paperwork Reduction Project (0704-0188), Washington, DC 20503. Please DO NOT RETURN your form to either of these
addresses. SEND COMPLETED FORM TO THE GOVERNMENT ISSUING CONTRACTING OFFICER FOR THE CONTRACT/PR NO. LISTED IN BLOCK E.
------------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                          <C>
A. CONTRACT LINE ITEM NO.               B. EXHIBIT                   C. CATEGORY:

   SEE 16                                                               TDP ________   TM-_______   OTHER __________________________
------------------------------------------------------------------------------------------------------------------------------------
D. SYSTEM/ITEM                          E. CONTRACT/PR NO.                      F. CONTRACTOR

   Research and Development (BAA)          N00178-03-C-3079                        CDEX, INC.
------------------------------------------------------------------------------------------------------------------------------------
1. DATA ITEM NO.        2. TITLE OF DATA ITEM                                   3. SUBTITLE

   A001                    STATUS REPORT                                           MONTHLY STATUS REPORT
------------------------------------------------------------------------------------------------------------------------------------
4. AUTHORITY (DATA ACQUISITION          5. CONTRACT REFERENCE                   6. REQUIRING OFFICE
   DOCUMENT NO.)
                                           CLINs 0001AA, 0001AB, 0001AC &
   DI-MGMT-80368                           CLIN 0003                               NSWCDD Code J12
------------------------------------------------------------------------------------------------------------------------------------
7. DD 250 REQ           9. DIST STATEMENT       10. FREQUENCY   12. DATE OF                     14.        DISTRIBUTION
                           REQUIRED                                 FIRST SUBMISSION            ------------------------------------
   LT                                               MTHLY           35 DAC                                              b. COPIES
-----------------------                         ------------------------------------------------                   -----------------
8. APP CODE                                     11. AS OF DATE  13. DATE OF                        a. ADDRESSEE            Final
                           E                                        SUBSEQUENT SUBMISSION                          Draft -----------
                                                    See 16          See 16                                                Reg  Repro
------------------------------------------------------------------------------------------------------------------------------------
16. REMARKS
                                                                                                COR via email to:    0     1     0
Monthly Status Report. Report, signed by a Corporate Officer, to be submitted                   BoughtonRA@nswc.
35 days after beginning of contract and every month thereafter. Report shall be                 navy.mil
submitted in a Microsoft Office application format. Cost based on contractor
format acceptable.

DI-MGMT-80368 Section 10.2.2.3 is not required.

Address all work (conducted or completed) during the report period shall be
identified in the report; if none are originated, a statement to that effect shall be
made.

Inventions and Computer programs originating during the report period shall be
identified in the report; if none are originated, a statement to that effect shall be
made.                                                                                           NSWCDD               0     1     0
                                                                                                Procurement Div.
Submit the report with the above Block 3 Subtitle, the Contract Number, and the                 via email:
report submission date.                                                                         elliottdg@nswc.
                                                                                                navy.mil
Block A and 5: Applies to all CLINS and sub-CLINS which reference CDRL A001.

Block 9: Distribution statement B applies - "Distribution authorized to US
Government agencies only. Other requests for this document must be referred to
NSWCDD/J12.

                                                                                                ------------------------------------
                                                                                                15. TOTAL -->        0     3     0
------------------------------------------------------------------------------------------------------------------------------------
G. PREPARED BY                          H. DATE                      I. APPROVED BY                             J. DATE

------------------------------------------------------------------------------------------------------------------------------------

----------------------------
17. PRICE GROUP

----------------------------
18. ESTIMATED TOTAL PRICE

----------------------------

DD FORM 1423-1, JUN 90                             PREVIOUS EDITIONS ARE OBSOLETE                          Page _____ of _____ Pages
1007-183
</TABLE>

<PAGE>

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
                         CONTRACT DATA REQUIREMENTS LIST                                        FORM APPROVED
                                  (1 DATA ITEM)                                                 OMB NO. 0704-0188
------------------------------------------------------------------------------------------------------------------------------------
Public reporting burden for this collection of information is estimated to average 110 hours per response, including the time
for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing
the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to Department of Defense, Washington Headquarters Services, Directorate for
Information Operations and Reports, 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302, and to the Office Management
and Budget, Paperwork Reduction Project (0704-0188), Washington, DC 20503. Please DO NOT RETURN your form to either of these
addresses. SEND COMPLETED FORM TO THE GOVERNMENT ISSUING CONTRACTING OFFICER FOR THE CONTRACT/PR NO. LISTED IN BLOCK E.
------------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                          <C>
A. CONTRACT LINE ITEM NO.               B. EXHIBIT                   C. CATEGORY:

   SEE 16                                                               TDP ________   TM-_______   OTHER __________________________
------------------------------------------------------------------------------------------------------------------------------------
D. SYSTEM/ITEM                          E. CONTRACT/PR NO.                      F. CONTRACTOR

   Research and Development (BAA)          N00178-03-C-3079                        CDEX, INC.
------------------------------------------------------------------------------------------------------------------------------------
1. DATA ITEM NO.        2. TITLE OF DATA ITEM                                   3. SUBTITLE

   A002                    Contact Summary Report                                  Feasibility Study Comprehensive Final Report
------------------------------------------------------------------------------------------------------------------------------------
4. AUTHORITY (DATA ACQUISITION          5. CONTRACT REFERENCE                   6. REQUIRING OFFICE
   DOCUMENT NO.)
                                           CLIN 0001AE
   DI-ADMN-80447                                                                   NSWCDD Code J12
------------------------------------------------------------------------------------------------------------------------------------
7. DD 250 REQ           9. DIST STATEMENT       10. FREQUENCY   12. DATE OF                     14.        DISTRIBUTION
                           REQUIRED                                 FIRST SUBMISSION            ------------------------------------
   DD                                               ONE TIME        30 DAYS AFTER CC                                    b. COPIES
-----------------------                         ------------------------------------------------                   -----------------
8. APP CODE                                     11. AS OF DATE  13. DATE OF                        a. ADDRESSEE            Final
                           E                                        SUBSEQUENT SUBMISSION                          Draft -----------
                                                                    NONE                                                  Reg  Repro
------------------------------------------------------------------------------------------------------------------------------------
16. REMARKS
                                                                                                COR via email to:    0     1     0
Feasibility Study Comprehensive Final Report. Report to be delivered 30 days                    BoughtonRA@nswc.
after completion of the contract. Report shall be prepared in both Microsoft                    navy.mil
Office and PDF format.

Block 3: Typed report, with cover page bearing: the Block 3 Subtitle; the
Contract Number; the BAA Number; and the report submission date.

Report body shall present the work completed in sufficient detail to permit                     NSWCDD               0     1     0
independent verification of the results obtained and shall detail major                         Procurement Div.
accomplishments and/or findings.                                                                via email:
                                                                                                elliottdg@nswc.
Block A and 5: Applies to all CLINS and sub-CLINS which reference CDRL                          navy.mil
A002.

Block 9: Distribution statement E applies - "Distribution authorized to DOD
components only as proprietary information may be involved. Other requests for
this document must be referred to NSWCDD/J12."

Block 14: Distribution is as follows: One electronic copy of the report in
Microsoft Office format shall be submitted to the COR. One electronic copy of
the Transmittal Letter, only, to the Procurement Division.

                                                                                                ------------------------------------
                                                                                                15. TOTAL -->              2
------------------------------------------------------------------------------------------------------------------------------------
G. PREPARED BY                          H. DATE                      I. APPROVED BY                             J. DATE

------------------------------------------------------------------------------------------------------------------------------------

----------------------------
17. PRICE GROUP

----------------------------
18. ESTIMATED TOTAL PRICE

----------------------------

DD FORM 1423-1, JUN 90                             PREVIOUS EDITIONS ARE OBSOLETE                          Page _____ of _____ Pages
1007-183
</TABLE>

<PAGE>

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
                         CONTRACT DATA REQUIREMENTS LIST                                        FORM APPROVED
                                  (1 DATA ITEM)                                                 OMB NO. 0704-0188
------------------------------------------------------------------------------------------------------------------------------------
Public reporting burden for this collection of information is estimated to average 110 hours per response, including the time
for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing
the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to Department of Defense, Washington Headquarters Services, Directorate for
Information Operations and Reports, 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302, and to the Office Management
and Budget, Paperwork Reduction Project (0704-0188), Washington, DC 20503. Please DO NOT RETURN your form to either of these
addresses. SEND COMPLETED FORM TO THE GOVERNMENT ISSUING CONTRACTING OFFICER FOR THE CONTRACT/PR NO. LISTED IN BLOCK E.
------------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                          <C>
A. CONTRACT LINE ITEM NO.               B. EXHIBIT                   C. CATEGORY:

   SEE 16                                                               TDP ________   TM-_______   OTHER __________________________
------------------------------------------------------------------------------------------------------------------------------------
D. SYSTEM/ITEM                          E. CONTRACT/PR NO.                      F. CONTRACTOR

   Research and Development (BAA)          N00178-03-C-3079                        CDEX, INC.
------------------------------------------------------------------------------------------------------------------------------------
1. DATA ITEM NO.        2. TITLE OF DATA ITEM                                   3. SUBTITLE
                                                                                   Demo Prototype Development Research Plan
   A003                    Contact Summary Report                                  w/Cost Proposal & Conceptual Design
------------------------------------------------------------------------------------------------------------------------------------
4. AUTHORITY (DATA ACQUISITION          5. CONTRACT REFERENCE                   6. REQUIRING OFFICE
   DOCUMENT NO.)
                                           CLIN 0002
   DI-ADMN 80447                                                                   NSWCDD, Code J12/Robert Brannon
------------------------------------------------------------------------------------------------------------------------------------
7. DD 250 REQ           9. DIST STATEMENT       10. FREQUENCY   12. DATE OF                     14.        DISTRIBUTION
                           REQUIRED                                 FIRST SUBMISSION            ------------------------------------
   LT                                               ONE TIME        30 DAYS AFTER CC                                    b. COPIES
-----------------------                         ------------------------------------------------                   -----------------
8. APP CODE                                     11. AS OF DATE  13. DATE OF                        a. ADDRESSEE            Final
                           E                                        SUBSEQUENT SUBMISSION                          Draft -----------
                                                                    NONE                                                  Reg  Repro
------------------------------------------------------------------------------------------------------------------------------------
16. REMARKS
                                                                                                COR via email to:    0     1     0
Demonstration Prototype Development Research Plan with Cost Proposal and                        BoughtonRA@nswc.
Prototype Conceptual Design. Report to be delivered 30 days after completion of                 navy.mil
the contract. Report shall be prepared in Microsoft Office. The report shall be
used to gain a better understanding of what the contractor plans to accomplish
under Prototype Development option effort. This report along with the
Feasibility Study final report will be used to decide whether or not to exercise the
option effort.
                                                                                                NSWCDD               0     1     0
Block A and 5: Applies to all CLINS and sub-CLINS which reference CDRL                          Procurement Div.
A003.                                                                                           via email:
                                                                                                elliottdg@nswc.
Block 9: Distribution statement E applies - "Distribution authorized to DOD                     navy.mil
components only as proprietary information may be involved. Other requests for
this document must be referred to NSWCDD/J12."

Block 14: Distribution is as follows: One electronic copy of the report in
Microsoft Office format shall be submitted to the COR. Send Letter of
Transmittal only, to Procurement Division.

                                                                                                ------------------------------------
                                                                                                15. TOTAL -->              2
------------------------------------------------------------------------------------------------------------------------------------
G. PREPARED BY                          H. DATE                      I. APPROVED BY                             J. DATE

------------------------------------------------------------------------------------------------------------------------------------

----------------------------
17. PRICE GROUP

----------------------------
18. ESTIMATED TOTAL PRICE

----------------------------

DD FORM 1423-1, JUN 90                             PREVIOUS EDITIONS ARE OBSOLETE                          Page _____ of _____ Pages
1007-183
</TABLE>

<PAGE>

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
                         CONTRACT DATA REQUIREMENTS LIST                                        FORM APPROVED
                                  (1 DATA ITEM)                                                 OMB NO. 0704-0188
------------------------------------------------------------------------------------------------------------------------------------
Public reporting burden for this collection of information is estimated to average 110 hours per response, including the time
for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing
the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to Department of Defense, Washington Headquarters Services, Directorate for
Information Operations and Reports, 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302, and to the Office Management
and Budget, Paperwork Reduction Project (0704-0188), Washington, DC 20503. Please DO NOT RETURN your form to either of these
addresses. SEND COMPLETED FORM TO THE GOVERNMENT ISSUING CONTRACTING OFFICER FOR THE CONTRACT/PR NO. LISTED IN BLOCK E.
------------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                          <C>
A. CONTRACT LINE ITEM NO.               B. EXHIBIT                   C. CATEGORY:

   SEE 16                                                               TDP ________   TM-_______   OTHER __________________________
------------------------------------------------------------------------------------------------------------------------------------
D. SYSTEM/ITEM                          E. CONTRACT/PR NO.                      F. CONTRACTOR

   Research and Development (BAA)          N00178-03-C-3079                        CDEX, INC.
------------------------------------------------------------------------------------------------------------------------------------
1. DATA ITEM NO.        2. TITLE OF DATA ITEM                                   3. SUBTITLE
                                                                                   Prototype Hardware, Software, and Operation
   A005                    Software User Manual                                    Manual
------------------------------------------------------------------------------------------------------------------------------------
4. AUTHORITY (DATA ACQUISITION          5. CONTRACT REFERENCE                   6. REQUIRING OFFICE
   DOCUMENT NO.)
                                           CLIN 0004
   DI-IPSC-81443A                                                                  NSWCDD Code J12
------------------------------------------------------------------------------------------------------------------------------------
7. DD 250 REQ           9. DIST STATEMENT       10. FREQUENCY   12. DATE OF                     14.        DISTRIBUTION
                           REQUIRED                                 FIRST SUBMISSION            ------------------------------------
   LT                                               ONE TIME        SEE 16                                              b. COPIES
-----------------------                         ------------------------------------------------                   -----------------
8. APP CODE                                     11. AS OF DATE  13. DATE OF                        a. ADDRESSEE            Final
                           E                                        SUBSEQUENT SUBMISSION                          Draft -----------
                                                                    NONE                                                  Reg  Repro
------------------------------------------------------------------------------------------------------------------------------------
16. REMARKS
                                                                                                COR via email to:    0     1     0
Prototype Hardware, Software, and Operations Manual. Manual to be delivered                     BoughtonRA@nswc.
30 days before completion of the Prototype Development Option Period. Report                    navy.mil
shall be prepared in both Microsoft Office and PDF format.

Block 4: Contractor format is acceptable. Use DID as a guideline for the
information desired.

Block A and 5: Applies to all CLINS and sub-CLINS which reference CDRL                          NSWCDD               0     1     0
A006.                                                                                           Procurement Div.
                                                                                                via email:
Block 9: Distribution statement E applies - "Distribution authorized to DOD                     elliottdg@nswc.
components only as proprietary information may be involved. Other requests for                  navy.mil
this document must be referred to NSWCDD/J12."

Block 14: Distribution is as follows: One electronic copy of the report in
Microsoft Office format shall be submitted to the COR. One electronic copy of
the Transmittal Letter, only, to the Procurement Division.

                                                                                                ------------------------------------
                                                                                                15. TOTAL -->              2
------------------------------------------------------------------------------------------------------------------------------------
G. PREPARED BY                          H. DATE                      I. APPROVED BY                             J. DATE

------------------------------------------------------------------------------------------------------------------------------------

----------------------------
17. PRICE GROUP

----------------------------
18. ESTIMATED TOTAL PRICE

----------------------------

DD FORM 1423-1, JUN 90                             PREVIOUS EDITIONS ARE OBSOLETE                          Page _____ of _____ Pages
1007-183
</TABLE>

<PAGE>

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
                         CONTRACT DATA REQUIREMENTS LIST                                        FORM APPROVED
                                  (1 DATA ITEM)                                                 OMB NO. 0704-0188
------------------------------------------------------------------------------------------------------------------------------------
Public reporting burden for this collection of information is estimated to average 110 hours per response, including the time
for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing
the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to Department of Defense, Washington Headquarters Services, Directorate for
Information Operations and Reports, 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302, and to the Office Management
and Budget, Paperwork Reduction Project (0704-0188), Washington, DC 20503. Please DO NOT RETURN your form to either of these
addresses. SEND COMPLETED FORM TO THE GOVERNMENT ISSUING CONTRACTING OFFICER FOR THE CONTRACT/PR NO. LISTED IN BLOCK E.
------------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                          <C>
A. CONTRACT LINE ITEM NO.               B. EXHIBIT                   C. CATEGORY:

   SEE 16                                                               TDP ________   TM-_______   OTHER __________________________
------------------------------------------------------------------------------------------------------------------------------------
D. SYSTEM/ITEM                          E. CONTRACT/PR NO.                      F. CONTRACTOR

   Research and Development (BAA)          N00178-03-C-3079                        CDEX, INC.
------------------------------------------------------------------------------------------------------------------------------------
1. DATA ITEM NO.        2. TITLE OF DATA ITEM                                   3. SUBTITLE
                                                                                   Prototype Development Comprehensive Final
   A004                    Contract Summary Report                                 Report
------------------------------------------------------------------------------------------------------------------------------------
4. AUTHORITY (DATA ACQUISITION          5. CONTRACT REFERENCE                   6. REQUIRING OFFICE
   DOCUMENT NO.)
                                           CLIN 0004
   DI-ADMN-80447A                                                                  NSWCDD Code J12
------------------------------------------------------------------------------------------------------------------------------------
7. DD 250 REQ           9. DIST STATEMENT       10. FREQUENCY   12. DATE OF                     14.        DISTRIBUTION
                           REQUIRED                                 FIRST SUBMISSION            ------------------------------------
   DD                                               ONE TIME        SEE 16                                              b. COPIES
-----------------------                         ------------------------------------------------                   -----------------
8. APP CODE                                     11. AS OF DATE  13. DATE OF                        a. ADDRESSEE            Final
                           E                                        SUBSEQUENT SUBMISSION                          Draft -----------
                                                                    NONE                                                  Reg  Repro
------------------------------------------------------------------------------------------------------------------------------------
16. REMARKS
                                                                                                COR via email to:    0     1     0
Prototype Development Comprehensive Final Report. Report to be delivered 30                     BoughtonRA@nswc.
days after completion of the Prototype Development Option Period. Report shall                  navy.mil
be prepared in both Microsoft Office and PDF format.

Block 3: Typed Report, with cover page bearing: the Block 3 Subtitle; the
Contract Number; the BAA Number; and the report submission date.

Report body shall present the work completed in sufficient detail to permit                     NSWCDD               0     1     0
independent verification of the results obtained and shall detail major                         Procurement Div.
accomplishments and/or findings.                                                                via email:
                                                                                                elliottdg@nswc.
Block A and 5: Applies to all CLINS and sub-CLINS which reference CDRL                          navy.mil
A005.

Block 9: Distribution statement E applies - "Distribution authorized to DOD
components only as proprietary information may be involved. Other requests for
this document must be referred to NSWCDD/J12."

Block 14: Distribution is as follows: One electronic copy of the report in
Microsoft Office format shall be submitted to the COR. One electronic copy of
the Transmittal Letter, only, to the Procurement Division.

                                                                                                ------------------------------------
                                                                                                15. TOTAL -->              2
------------------------------------------------------------------------------------------------------------------------------------
G. PREPARED BY                          H. DATE                      I. APPROVED BY                             J. DATE

------------------------------------------------------------------------------------------------------------------------------------

----------------------------
17. PRICE GROUP

----------------------------
18. ESTIMATED TOTAL PRICE

----------------------------

DD FORM 1423-1, JUN 90                             PREVIOUS EDITIONS ARE OBSOLETE                          Page _____ of _____ Pages
1007-183
</TABLE>

<PAGE>

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
                         CONTRACT DATA REQUIREMENTS LIST                                        FORM APPROVED
                                  (1 DATA ITEM)                                                 OMB NO. 0704-0188
------------------------------------------------------------------------------------------------------------------------------------
Public reporting burden for this collection of information is estimated to average 110 hours per response, including the time
for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing
the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to Department of Defense, Washington Headquarters Services, Directorate for
Information Operations and Reports, 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302, and to the Office Management
and Budget, Paperwork Reduction Project (0704-0188), Washington, DC 20503. Please DO NOT RETURN your form to either of these
addresses. SEND COMPLETED FORM TO THE GOVERNMENT ISSUING CONTRACTING OFFICER FOR THE CONTRACT/PR NO. LISTED IN BLOCK E.
------------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                          <C>
A. CONTRACT LINE ITEM NO.               B. EXHIBIT                   C. CATEGORY:

   SEE 16                                                               TDP ________   TM-_______   OTHER __________________________
------------------------------------------------------------------------------------------------------------------------------------
D. SYSTEM/ITEM                          E. CONTRACT/PR NO.                      F. CONTRACTOR

   Research and Development (BAA)          N00178-03-C-3079                        CDEX, INC.
------------------------------------------------------------------------------------------------------------------------------------
1. DATA ITEM NO.        2. TITLE OF DATA ITEM                                   3. SUBTITLE

   A006                    Report of Invention and Disclosure                      Patent Application for Invention
------------------------------------------------------------------------------------------------------------------------------------
4. AUTHORITY (DATA ACQUISITION          5. CONTRACT REFERENCE                   6. REQUIRING OFFICE
   DOCUMENT NO.)

   "37 CFR Chapter 1"                      SEE BLOCK 16                            NSWCDD Code J12
------------------------------------------------------------------------------------------------------------------------------------
7. DD 250 REQ           9. DIST STATEMENT       10. FREQUENCY   12. DATE OF                     14.        DISTRIBUTION
                           REQUIRED                                 FIRST SUBMISSION            ------------------------------------
   LT                                               ONE/R           SEE BLOCK 16                                        b. COPIES
-----------------------                         ------------------------------------------------                   -----------------
8. APP CODE                                     11. AS OF DATE  13. DATE OF                        a. ADDRESSEE            Final
                                                                    SUBSEQUENT SUBMISSION                          Draft -----------
   A                       B                                        30 DARC                                               Reg  Repro
------------------------------------------------------------------------------------------------------------------------------------
16. REMARKS                                                                                     COR - hardcopy to    0     1     0
                                                                                                ship-to address at
Block 3: A Patent Application prepared in accordance with the Rules of Practice                 block 11 at Page 1
of the United States Patent and Trademark Office (PTO) (as set forth in 37 CRF
Chapter 1), including Specification, Drawings, Abstract, and one or more
Claims, together with an appropriate declaration executed by the inventor or
inventors, all in accordance with 37 CFR. The Patent Application shall be
accompanied by one of the two instruments described below:

1. An ASSIGNMENT OF THE INVENTION  by the Contractor to the Government of the
United States of America as represented by the Secretary of the Navy shall be
submitted to the Contracting Officer upon exercise of the Contrator's election,
under FAR 52.227-11, to decline application to the PTO for Patent. (The
Government applies for patent and you receive use license.)

2. Upon exercise of the Contractor's election under FAR 52.226-11 to apply to
PTO for patent, a CONFIRMATION INSTRUMENT shall be submitted to the Contracting
Officer. The instrument shall identify the Patent by PTO application serial
number and filling date, shall confirm nonexclusive, nontransferable,
irrevocable paid-up license to practice, or have practiced, the invention for or
on behalf of the United States, and shall grant the Government an irrevocable
power to inspect and make copies of the application and related papers in the
PTO. (The Government receives license to use your Patent.)

Block A and 5: Applies to all CLINS and sub-CLINS which reference CDRL
A005 (OR ALL CDRLS IN GENERAL).

Block 9: Distribution statement B applies applies - "Distribution authorized to
US Government agencies only." In order to protect information not owned by
the US Government, other requests for this document must be referred to
NSWCDD/J12.

Block 12: per FAR 52.227-11.

                                                                                                ------------------------------------
                                                                                                15. TOTAL -->        0     1     0
------------------------------------------------------------------------------------------------------------------------------------
G. PREPARED BY                          H. DATE                      I. APPROVED BY                             J. DATE

------------------------------------------------------------------------------------------------------------------------------------

----------------------------
17. PRICE GROUP

----------------------------
18. ESTIMATED TOTAL PRICE

----------------------------

DD FORM 1423-1, JUN 90                             PREVIOUS EDITIONS ARE OBSOLETE                          Page _____ of _____ Pages
1007-183
</TABLE>

<PAGE>

                                                                        9 APR 03

MEMORANDUM

From: J10
To:   XDS13

Subj: NOMINATION OF CONTRACTING OFFICER'S REPRESENTATIVE (CDEX, INC.)

Ref:  (a) NAVSEAINST 4200.17B, Contracting Officer's Representative (COR)

1. Pursuant to reference (a), I hereby nominate Roger Boughton as the
Contracting Officer's Representative (COR) for contract N00178-03-C-3079 with
CDEX, Inc. The contract is for research and development of sensor systems under
NSWC Broad Agency Announcement N60921-0l-Q-3040.

2. Mr. Boughton's qualifications are: Provides program management and systems
engineering support to NSWC projects and previously on ONR Missile Defense
program from September 2000 to September 2002. Past COR on ONR contract
N00014-02-C-0163 to provide software algorithm analysis: $150K, cost plus.

3. Mr. Boughton is trained as an Electrical Engineer. His title and grade are:
Engineer, ND4. His contact information is: NSWC Code J12, 17320 Dahlgren Road,
Dahlgren, VA 22448-5100. His phone number is 540-653-4882 and email address is
BOUGHTONRA@NSWC.NAVY.MIL.

4. In case of any problems, disagreements, or other questions pertaining to the
COR's performance of duties you may contact: Mr. John Wright (Jl2) or Mr. Art
Blankenship (J10L).

5. Mr. Boughton has completed Navy approved COR training. He has attended COR
training in October 1997 and the DAWIA sponsored 3-day COR training in July
2002.

6. The individual performance rating elements for Mr. Boughton include the COR
function as a stand-alone element.

7. I recommend that the COR be assigned the following duties:

      a. Control all Government technical interface with the contractor.

<PAGE>

Subj: NOMINATION OF CONTRACTING OFFICER'S REPRESENTIVE (CDEX, INC.)

      b. Ensure that a copy of all Government technical correspondence is
forwarded to the Contracting Officer (CO) for placement in the contract task
order file.

      c. Promptly furnish documentation on any requests for change, deviation,
or waiver, whether generated by the Government or the contractor, to the CO (and
Ordering Officer) for their action.

      d. Determine causes when the contract is not progressing as expected and
make recommendation to the CO for corrective action.

      e. Monitor contract performance to ensure individual contractor employees
are of the skill levels required and are actually performing at the levels
charged against the contract during the performance period.

      f. Monitor contract performance to ensure that the labor hours charged
against the contract are consistent and reasonable for the effort completed and
that any travel charged was necessary and actually occurred.

      g. Monitor Government Furnished Property. Ensure the property provided to
the contractor is authorized by the contract.

      h. Complete the COR Report of Contractor's Performance in accordance with
the schedule established in the contract administration plan for conduct.

8. Any changes to these recommended duties must be discussed with the
undersigned prior to issuing the appointment letter.

9. If you have any questions or comments, please contact the undersigned at
x3-1969.

                                             /s/ S. A. BLANKENSHIP

                                             S. A. BLANKENSHIP, Head
                                             Measured Response Options Division

Copy to:
J12
J12/Boughton

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00065-of-00352.parquet"}]]