CEO STATEMENT and the REGISTRATION UPDATE.....
February 2,2004
: : REGISTRATION UPDATE
On February 2, 2004, we filed with the Securities and Exchange Commission (SEC) an SB-2 to register 2,632,840 shares of our Class A Common Stock on behalf of certain of our shareholders. CDEX will not receive any proceeds from the sale of shares under the SB-2. We did not include in the SB-2 shares which can be sold under Rule 144 once we become a reporting company or which are already freely tradable by virtue of having been distributed by court order in conjunction with the Loch Harris litigation. We anticipate comments on the SB-2 from the SEC within approximately 30-45 days and plan on responding to those comments as quickly as practicable. If the SEC is satisfied with our responses to comments (which may take several rounds of questions), the filing will be allowed to become effective. If it becomes effective, we intend to complete registration under the Securities Exchange Act of 1934 and do not anticipate CDEX Class A Common Stock will be eligible for trading for four to five months, at the earliest. However, depending on the extent and nature of any comments from the SEC, it could potentially take longer.

November 17,2003

This CEO Statement updates our progress since my October 10, 2003 Statement. On the business front, we are pushing ahead with efforts to develop and field products in specific markets. As our products and "message" evolves, we appreciate more the adaptability of our technologies and the flexibility/ingenuity of our scientific team to adapt to market demands. CDEX is focusing on four very different business areas: identification of substances in challenging environments (e.g., explosives, illegal drugs and chemical/biological weapons); identification/validation of substances (e.g., in the health care community, prescription drugs for patient care and identification of counterfeit drugs introduced into the marketplace); brand protection (e.g., detection of counterfeit or sub-par products); and quality assurance (e.g., receipt inspection of materials in the chemical manufacturing process). Each application area is supported by our patents pending technologies and each by common technological platforms. All of these "markets" have thus far shown great promise, and we are excited about prospects for the future.

CDEX continues to work with the TSA to move forward our explosive detection product. This is a slower process than we had hoped, but we have come to have a great deal of respect for the folks at Homeland Security, and especially the TSA. They are showing great resolve and promise as they try to digest the huge task on their plate all the while struggling to stabilize their organization. We've been very pleased with the feedback we're getting and look forward to moving down this path.

Along the anti-counterfeiting front, CDEX participated in the FDA's Anti-Counterfeiting Drug Initiative Public Meeting, and upon request offered comments on the FDA Counterfeit Drug Task Force Interim Report. The Public Meeting was a tremendous demonstration of the private sector's ability to respond to our Government's request for innovation to fight criminals. There were over fifty applications to fight counterfeit medication shown at the Meeting, and CDEX could not be more pleased with the feedback and comments we heard on our application when viewed alongside some of the industry leaders. A number of good relationships were fostered, some well beyond our medical applications for fighting counterfeiting, and we are very excited about some of the new avenues to explore as a result of the Meeting. CDEX's next public event focus in anti-counterfeiting and prescription drug identification in the medical arena is the end of year clinical meeting of the American Society of Health-System Pharmacists® in New Orleans, LA.

The advancement in development, coupled with the growing response we are receiving in the targeted markets, demand that we augment our sales/marketing organization. We look forward to welcoming at several more members to the Team in the coming weeks.

We have been extremely fortunate to have the support of a number of private placement investors and continue to call upon this Team's expertise in a number of areas. This support is a source of great strength for me, personally. CDEX continues to get, and welcomes, inquiries from individuals interested in investing private funds.

This is my twelfth such update in the past 27 months, and I will continue to provide updates as appropriate. Thank you for your support and interest in CDEX.

Malcolm H. Philips, Jr.
President and CEO
November 17, 2003

CEO STATEMENT
October 10, 2003

Since my May 20, 2003 CEO Statement, much has happened, both within CDEX as well as other areas that directly impact CDEX. The purpose of this message is to first of all welcome as our newest shareholders those folks who are expected to receive CDEX stock soon from Loch Harris, and second provide an update to our progress.

With regard to our new shareholders, I would like to personally welcome each of you to CDEX. I look forward to working together to make CDEX a commercial success. We will continue to welcome constructive comments and questions, and respond as our resources allow. Although CDEX remains a private company, we appreciate shareholder's desire for information on their investment and will address those needs as much as possible in line with our resources. As you have questions, please contact us through our web site and we will try and provide answers in FAQs and CEO updates, as information warrants public release. It is not our policy to provide information on discussions or negotiations that are in progress and we will not provide information regarding projects that may disadvantage our commercial position. I am certain that those who have the best interest of CDEX at heart will agree with these policies.

CDEX has progressed well over the past four months, both on the technology front as well as the business side.

Technology and product development is progressing steadily under the leadership of Tim Shriver, Sr. VP of Operations. Tim has done an outstanding job with resources available to move forward development of our explosive detection and medical products, and to continue the work on our biological and chemical agent detection contract.

Development products in the area of explosive detection continue to be refined based on improvements in processes and feedback from the marketplace. We continue to work with representatives of the Government in the area of Trace Explosive Detection using PS3, as well as opening the door for the other products in our explosives detection suite currently under development. This will be an arduous process but one we're eager to move forward on. We are also pursuing other proposals and partnerships to move the technology into the fight against terrorism and improve airport, building and event security.

The medical product requirements are being refined based on information from prospective end users, including hospitals, local pharmacies and drug distribution centers, as well as Emergency Medical Services personnel. The need for timely, accurate and cost effective drug identification and validation is very real, and CDEX is excited to address this market.

CDEX continues to perform on our DoD contract focused on detection of chemical and biological agents. We have submitted several reports based on our work, and are looking forward to working with the DoD as we approach another milestone related to the next phase of this engagement. The work is very challenging and certainly needed by our Nation.

Our business continues to evolve consistent with a maturing company. The move from a R/D based company to a more market driven company has been a challenge for everyone, but our Team remains committed to this maturing process and to each other. The process of assimilating information gathered from the marketplace and transferring that information into the development shop has led to improvements in our products and processes.

Our market research efforts have resulted in demonstrations to potential partners and potential customers, both in private sector as well as various State and Federal Government Agencies. True to our business vision, CDEX remains committed to exploring a myriad of distribution channels such as direct sales, channel relationships as well as licensing our technology to third parties. We are also committed to establishing revenue streams outside of Government customers, appreciating that long-term growth must come from customers from private industry. We have made significant progress in these areas and anticipate further progress.

The most commonly asked question we receive via our web site continues to be "where are you on registering the stock?" We are unfortunately limited by the federal securities laws in what we can say concerning registration of CDEX stock, but, consistent with all our statements to date, we remain committed to the goal of creating a public market for CDEX shares.

I continue to be thankful for our private placement investors. Members of this group have shown an amazing ability not only to provide sound business logic and problem solving, but also a timely shoulder to lean on and an appreciated pat on the back at the right times. CDEX would not exist without them, and that is beside the financial support. Our private placement investors are continuing to expand providing additional funds and business skill sets that we draw upon.

This is my eleventh such update in the past 26 months, and I will continue to provide updates as appropriate. Thank you for your support and interest in CDEX.