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<SEC-DOCUMENT>0001144204-05-010142.txt : 20050401
<SEC-HEADER>0001144204-05-010142.hdr.sgml : 20050401
<ACCEPTANCE-DATETIME>20050401153158
ACCESSION NUMBER:		0001144204-05-010142
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20050329
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Termination of a Material Definitive Agreement
ITEM INFORMATION:		Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20050401
DATE AS OF CHANGE:		20050401

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			DYADIC INTERNATIONAL INC
		CENTRAL INDEX KEY:			0001213809
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-COMMERCIAL PHYSICAL & BIOLOGICAL RESEARCH [8731]
		IRS NUMBER:				450486747
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	333-102629
		FILM NUMBER:		05725240

	BUSINESS ADDRESS:	
		STREET 1:		140 INTERNATIONAL POINTE DRIVE
		STREET 2:		SUITE 404
		CITY:			JUPITER
		STATE:			FL
		ZIP:			33477
		BUSINESS PHONE:		561-743-8333

	MAIL ADDRESS:	
		STREET 1:		140 INTERNATIONAL POINTE DRIVE
		STREET 2:		SUITE 404
		CITY:			JUPITER
		STATE:			FL
		ZIP:			33477

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CCP WORLDWIDE INC
		DATE OF NAME CHANGE:	20030110
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>v015624.txt
<TEXT>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT
     Pursuant to SECTION 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of earliest event reported):          March 29, 2005
                                                 -------------------------------

                           Dyadic International, Inc.
- --------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


          Delaware                 333-102629                 45-0486747
- --------------------------------------------------------------------------------
(State or other jurisdiction       (Commission               (IRS Employer
      of incorporation)           File Number)            Identification No.)


         140 Intracoastal Pointe Drive, Suite 404
                     Jupiter, Florida                           33477
- --------------------------------------------------------------------------------
         (Address of principal executive offices)            (Zip Code)


Registrant's telephone number, including area code:         (561) 743-8333
                                                   -----------------------------


- --------------------------------------------------------------------------------
         (Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

     |_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)

     |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)

     |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))

     |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c)) o

<PAGE>

SECTION 1 - REGISTRANT'S BUSINESS AND OPERATIONS

Item 1.01  Entry Into a Material Definitive Agreement

         On March 29, 2005, the Board of Directors ("Board") of Dyadic
International, Inc., a Delaware corporation (the "Company"), elected Robert B.
Shapiro as a Class I Director. In accordance with the Company's Director
Compensation Policy, the Board granted to Mr. Shapiro a stock option (the
"Director Option") to purchase 30,000 shares of Common Stock of the Company
("Option Shares") under the Dyadic International, Inc. 2001 Equity Compensation
Plan (the "Equity Compensation Plan") at an exercise price of $2.895 per Option
Share, pursuant to an option agreement in the form of the Company's standard
form director stock option agreement. The Director Option granted to Mr. Shapiro
becomes exercisable on the grant date as to 25% of the Option Shares purchasable
thereunder and, conditioned upon his continued service on the Board, exercisable
as to 18.75% of the Option Shares purchasable thereunder on each of the next
four anniversaries of the grant date, in accordance with the Director
Compensation Policy. Mr. Shapiro's Director Option expires on March 29, 2010.

         As authorized by the Board, on March 29, 2005, concurrently with his
election to the Board as a Class I director, the Company entered into an
Indemnification Agreement with Mr. Shapiro on its standard form for such
agreements. Under that Indemnification Agreement, the Company agreed to
indemnify Mr. Shapiro against any liability arising out of his performance of
his duties to the Company in his capacity as a director. The Indemnification
Agreement provides Mr. Shapiro with an indemnification in addition to the
indemnification provided by the Company's Restated Certificate of Incorporation
and Amended and Restated Bylaws. Among other things, the Indemnification
Agreement indemnifies Mr. Shapiro for certain expenses (including attorneys'
fees), judgments, fines and settlement amounts incurred by him in any action or
proceeding, including any action by or in the right of the Company arising out
of his service to the Company, to any of its subsidiaries, and to any other
company or enterprise to which he provides services at the Company's request.
Further, the Company agrees to advance to Mr. Shapiro expenses he may incur as a
result of any proceeding against him as to which he could be indemnified.

         On March 30, 2005, the Company entered into employment agreements with
three of its executive officers, and in connection therewith, promoted them to
new offices: Mr. Kent M. Sproat, formerly Vice President, Manufacturing, was
promoted to Executive Vice President, Enzymes Business; Mr. Ratnesh (Ray)
Chandra, formerly Vice President, Marketing - BioSciences, was promoted to
Senior Vice President, Marketing - Biotechnology Systems; and Mr. Alexander
(Sasha) Bondar, formerly Executive Director, Business Development, was promoted
to Vice President, Strategy & Corporate Development. Mr. Sproat was also
promoted to the office of Executive Vice President of the Company's operating
subsidiary, Dyadic International (USA), Inc., a Florida corporation
("Dyadic-Florida").

         The initial term of employment under all three employment agreements
ends on December 31, 2007, with automatic one-year renewals unless either party
furnishes the other a notice of non-renewal not less than 90 days prior to the
expiration of the then term. The annual base compensation of Mr. Sproat, Mr.
Chandra and Mr. Bondar is $190,000, $170,250 and $143,000, respectively, and
each of them is eligible to earn a bonus each year of up to 40% of his annual
base compensation based upon a bonus plan to be adopted and maintained by the
Compensation Committee of the Board of Directors of the Company (the
"Compensation Committee") for such year.


                                       2
<PAGE>

         Each employment agreement is terminable on account of the executive's
death or disability, or by the Company without cause or "for Cause." The phrase
"for Cause" is defined to include a material breach of the employment agreement,
acts of disloyalty to the Company (including but not limited to acts of
dishonesty or diversion of corporate opportunities), the unauthorized disclosure
of the Company's confidential information, or acts determined in good faith by
the Compensation Committee to be detrimental to the Company's interests,
provided that the executive must be afforded an opportunity to have a
face-to-face meeting with the Compensation Committee before any determination is
made by it that he was guilty of "for Cause" conduct. If the executive's
employment is terminated by the Company other than "for Cause," upon the
condition that he furnish the Company with a full general release, he is
entitled to receive a severance benefit of monthly installments in the amount of
1/12th of his then annual base compensation for a period of 6 months. Under each
employment agreement, the Company is also obligated to indemnify the executive
to the fullest extent permitted by applicable law. Further, the Company agrees
to advance expenses he may spend as a result of any proceeding against him as to
which he could be indemnified.

         Mr. Sproat's and Mr. Chandra's employment agreements also include
provisions that might entitle them to extended severance benefits following the
occurrence of a "Change of Control" of either the Company or its BioScience
Business, in the case of Mr. Chandra, and following the occurrence of a "Change
of Control" of either the Company or its Enzymes Business, in the case of Mr.
Sproat. Under both agreements, upon a termination of the executive's employment
by the Company or its successor-in-interest other than "for Cause," or a
termination of the his employment by the executive which is a "Constructive
Termination of Employment Without Cause," within 12 months following the
occurrence of a Change of Control, he will become entitled to a severance
benefit of monthly installments in the amount of 1/12th of his then annual base
compensation for 18 months. The phrase "Change of Control" means: (i) a sale,
lease, exchange or other transfer of all or substantially all of the assets of
the Company; (ii) a merger or consolidation of the Company in which less than a
majority of the outstanding voting securities of the surviving corporation are
not owned by stockholders of the Company immediately prior to such merger or
consolidation; (iii) a "person" or "group" (as those terms are defined in
Section 13(d) and 14(d) of the Exchange Act of 1934, as amended) not beneficial
owners of voting securities of the Company on March 30, 2005 become the
beneficial owners, directly or indirectly, of more than 50% of the outstanding
voting securities of the Company other than as a result of the purchase of such
voting securities from the Company in a transaction or series of transactions
approved by the affirmative vote of a majority of the directors who were members
of the Board one month prior to the date of such transaction; (iv) a sale,
lease, exchange or other transfer of all or substantially all of the assets of
the Enzymes Business (in the case of Mr. Sproat) or the BioSciences Business (in
the case of Mr. Chandra) in a transaction in which, following such transaction,
the transferee is not an affiliate of the Company; or (v) a consolidation or
merger of any subsidiary or affiliate of the Company that owns substantially all
of the assets used in the conduct of the of the Enzymes Business (in the case of
Mr. Sproat) or the BioSciences Business (in the case of Mr. Chandra) with
another party, the survivor of which is not an affiliate of the Company. The
phrase, "Constructive Termination of Employment Without Cause" in both
agreements is defined to mean a termination of employment at the election of the
executive made within 12 months following a change of control and within 60 days
following the occurrence of any of the following events: (i) a material demotion
in his office, duties or responsibilities; (ii) a reduction in his annual base
compensation or potential annual bonus; (iii) the imposition of a requirement
that he relocate his principal residence outside a 50 mile radius of the
Company's current principal place of business; or (iv) the failure of the
Company or its successor-in-interest to comply with the terms of his employment
agreement.

                                       3
<PAGE>

         In connection with the Company's entry into these employment
agreements, on March 30, 2005, each of these three executives was granted a
stock option (an "Employee Option") to purchase Option Shares under the Equity
Compensation Plan at an exercise price of $3.025 per Option Share. Each Employee
Option was evidenced by an option agreement in the form of Company's standard
form employee stock option agreement. The Employee Options granted to Mr.
Sproat, Mr. Chandra and Mr. Bondar were for 70,000, 50,000 and 35,000 Option
Shares, respectively. Each Employee Option becomes exercisable, conditioned upon
that executive's continued service as an employee of the Company, as to 25% of
the Option Shares on each of the next four anniversaries of the date of his
employment agreement, and expires on March 30, 2010.

         To the extent any of the disclosures set forth in Item 5.02 below are
required to be disclosed in this Item 1.01, such information is incorporated in
this Item 1.01 by reference.

Item 1.02  Termination of a Material Definitive Agreement

         Mr. Chandra's new employment agreement with the Company replaces a
previously existing employment agreement between him and the Company dated May
1, 2000.

         Incident to the consummation of the Company's merger with
Dyadic-Florida in October 2004, the Company assumed the rights and obligations
of Dyadic-Florida under confidential information, inventions assignment and
non-compete agreements between Dyadic-Florida and each of Mr. Kent Sproat, Mr.
Chandra and Mr. Bondar (the "Proprietary Rights Agreements"). Under the terms of
these Proprietary Rights Agreements, each executive conferred upon the Company
certain warranties and customary proprietary rights in respect of the Company's
confidential information and intellectual work product contributed to by him, as
well as his covenant not to solicit customers of the Company while employed by
the Company and for three years after the termination of his employment. These
Proprietary Rights Agreements are superceded by the new employment agreements
with the Company, except to the extent the terms of the Proprietary Rights
Agreements are not inconsistent with the provisions of the new employment
agreements. As a result, certain undertakings of the executives made under the
Proprietary Rights Agreements, such as warranties made on the date they were
executed and undertakings made with respect of the publication of scientific
articles, remain in full force and effect, while others, such as the
non-solicitation covenant, are superceded by the new employment agreements.


                                       4
<PAGE>

SECTION 5 - CORPORATE GOVERNANCE AND MANAGEMENT

Item 5.02 Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers

         On March 29, 2005, the Board increased the number of its members from
three to four, and elected Robert B. Shapiro to serve as a Class I director with
a term expiring at the annual meeting of stockholders to be held in 2005.

         During the past five years, Mr. Shapiro has served as a member of the
Board of Directors of the New York Stock Exchange (on which he still serves),
Citigroup, Inc. and Rockwell International, as Chairman of Pharmacia
Corporation's Board of Directors and, prior to its merger with Phamacia &
Upjohn, as Chairman and Chief Executive Officer of Monsanto Company (1995
through 2001). Prior to becoming the Chairman and Chief Executive Officer of
Monsanto, Mr. Shapiro served in various executive capacities with Monsanto from
1985, and with G.D. Searle & Company, a diversified electronics company, between
1979 and 1985, first as its general counsel (1972 through 1982), and then as
President of its then newly formed NutraSweet Group (1982 through 1985). Mr.
Shapiro is a 1959 graduate of Harvard College and a 1962 graduate of Columbia
University School of Law.

         To the extent any of the disclosures set forth in Item 1.01 above are
required to be disclosed in this Item 5.02, such information is incorporated in
this Item 5.02 by reference.

SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS

Item 9.01  Financial Statements and Exhibits

         (c)      Exhibits.

         The following exhibits are furnished in accordance with the provisions
of Item 601 of Regulation S-B:

  Exhibit
  Number     Description of Exhibit
  ------     ----------------------

  99.1       Indemnification  Agreement  dated March 29, 2005
             between Dyadic  International,  Inc. and Robert B. Shapiro

  99.2       Employment  Agreement  dated March 30, 2005 between
             Dyadic  International,  Inc. and Kent M. Sproat

  99.3       Employment  Agreement  dated March 30, 2005 between
             Dyadic  International,  Inc. and Ratnesh (Ray) Chandra

  99.4       Employment  Agreement  dated March 30, 2005 between
             Dyadic  International,  Inc. and Alexander (Sasha) Bondar

  99.5       Form Employee Option Agreement under the Dyadic International, Inc.
             2001 Equity Compensation Plan


                                       5
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                  DYADIC INTERNATIONAL, INC.



Date:  March 31, 2005             By:    /s/ Mark A. Emalfarb
                                         -----------------------
                                  Name:  Mark A. Emalfarb
                                  Title: President and Chief Executive Officer


                                       6
<PAGE>

                                Index to Exhibits


  Exhibit
  Number     Description of Exhibit
  ------     ----------------------
  99.1       Indemnification  Agreement  dated March 29, 2005
             between Dyadic  International,  Inc. and Robert B. Shapiro

  99.2       Employment  Agreement  dated March 30, 2005 between
             Dyadic  International,  Inc. and Kent M. Sproat

  99.3       Employment  Agreement  dated March 30, 2005 between
             Dyadic  International,  Inc. and Ratnesh (Ray) Chandra

  99.4       Employment  Agreement  dated March 30, 2005 between
             Dyadic  International,  Inc. and Alexander (Sasha) Bondar

  99.5       Form Employee Option Agreement under the Dyadic International, Inc.
             2001 Equity Compensation Plan

                                       7
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ex99-1.txt
<TEXT>
                           DYADIC INTERNATIONAL, INC.

                            INDEMNIFICATION AGREEMENT

      This Indemnification  Agreement  ("Agreement") is made as of the 29th day
of  March,  2005,  by and  between  DYADIC  INTERNATIONAL,  INC.,  a  Delaware
corporation (the "Company"), and Robert Shapiro ("Indemnitee").

                                    RECITALS:

      A. The Company and Indemnitee recognize the significant cost of directors'
and officers' liability insurance and the general reductions in the coverage of
such insurance.

      B. The Company and Indemnitee further recognize the substantial increase
in corporate litigation in general, subjecting officers and directors to
expensive litigation risks at the same time as the coverage of liability
insurance has been severely limited.

      C. The Company desires to attract and retain the services of highly
qualified individuals, such as Indemnitee, to serve as officers and directors of
the Company and to indemnify its officers and directors so as to provide them
with the maximum protection permitted by law.

                                   AGREEMENT:

      NOW, THEREFORE, in consideration for Indemnitee's services as an officer
or director of the Company, the Company and Indemnitee hereby agree as follows:

1. INDEMNIFICATION.

      (a) Third Party Proceedings. The Company shall indemnify Indemnitee if
Indemnitee is or was a party or is threatened to be made a party to any
threatened, pending or completed action, suit, proceeding or any alternative
dispute resolution mechanism, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Company) by reason
of the fact that Indemnitee is or was a director, officer, employee or agent of
the Company, or any subsidiary of the Company, or by reason of the fact that
Indemnitee is or was serving at the request of the Company as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys, fees),
judgments, fines and amounts paid in settlement (if such settlement is approved
in advance by the Company, which approval shall not be unreasonably withheld)
actually and reasonably incurred by Indemnitee in connection with such action,
suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe Indemnitee's conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that Indemnitee did not act in good faith and in a manner which
Indemnitee reasonably believed to be in or not opposed to the best interests of
the Company, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that Indemnitee's conduct was unlawful.
<PAGE>

      (b) Proceedings By or in the Right of the Company. The Company shall
indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made
a party to any threatened, pending or completed action or suit by or in the
right of the Company or any subsidiary of the Company to procure a judgment in
its favor by reason of the fact that Indemnitee is or was a director, officer,
employee or agent of the Company, or any subsidiary of the Company, or by reason
of the fact that Indemnitee is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys, fees)
and, to the fullest extent permitted by law, amounts paid in settlement actually
and reasonably incurred by Indemnitee in connection with the defense or
settlement of such action or suit if Indemnitee acted in good faith and in a
manner Indemnitee reasonably believed to be in or not opposed to the best
interests of the Company, except that no indemnification shall be made in
respect of any claim, issue or matter as to which Indemnitee shall have been
adjudged to be liable to the Company unless and only to the extent that the
Court of Chancery of the State of Delaware or the court in which such action or
suit was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, Indemnitee is
fairly and reasonably entitled to indemnity for such expenses which the Court of
Chancery of the State of Delaware or such other court shall deem proper.

      (c) Mandatory Payment of Expenses. To the extent that Indemnitee has been
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Subsections (a) and (b) of this Section 1, or in
defense of any claim, issue or matter therein, Indemnitee shall be indemnified
against expenses (including attorneys' fees) actually and reasonably incurred by
Indemnitee in connection therewith.

2. EXPENSES; INDEMNIFICATION PROCEDURE.

      (a) Advancement of Expenses. The Company shall advance all expenses
incurred by Indemnitee in connection with the investigation, defense, settlement
or appeal of any civil or criminal action, suit or proceeding referenced in
Section 1(a) or (b) hereof (but not amounts actually paid in settlement of any
such action, suit or proceeding). Indemnitee hereby undertakes to repay such
amounts advanced only if, and to the extent that, it shall ultimately be
determined that Indemnitee is not entitled to be indemnified by the Company as
authorized hereby. The advances to be made hereunder shall be paid by the
Company to Indemnitee within thirty (30) days following delivery of a written
request therefor by Indemnitee to the Company.

      (b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a condition
precedent to his right to be indemnified under this Agreement, give the Company
notice in writing as soon as practicable of any claim made against Indemnitee
for which indemnification will or could be sought under this Agreement. Notice
to the Company shall be directed to the President of the Company at the address
shown on the signature page of this Agreement (or such other address as the
Company shall designate in writing to Indemnitee). Notice shall be deemed
received three business days after the date postmarked if sent by domestic
certified or registered mail, properly addressed, five business days if sent by
airmail to a country outside of North America; otherwise notice shall be deemed
received when such notice shall actually be received by the Company. In
addition, Indemnitee shall give the Company such information and cooperation as
it may reasonably require and as shall be within Indemnitee's power.


                                       2
<PAGE>

      (c) Procedure. Any indemnification and advances provided for in Section 1
and this Section 2 shall be made no later than thirty (30) days after receipt of
the written request of Indemnitee. If a claim under this Agreement, under any
statute, or under any provision of the Company's Certificate of Incorporation or
Bylaws providing for indemnification, is not paid in full by the Company within
thirty (30) days after a written request for payment thereof has first been
received by the Company, Indemnitee may, but need not, at any time thereafter
bring an action against the Company to recover the unpaid amount of the claim
and, subject to Section 12 of this Agreement, Indemnitee shall also be entitled
to be paid for the expenses (including attorneys' fees) of bringing such action.
It shall be a defense to any such action (other than an action brought to
enforce a claim for expenses incurred in connection with any action, suit or
proceeding in advance of its final disposition) that Indemnitee has not met the
standards of conduct which make it permissible under applicable law for the
Company to indemnify Indemnitee for the amount claimed. However, Indemnitee
shall be entitled to receive interim payments of expenses pursuant to Subsection
2(a) unless and until such defense may be finally adjudicated by court order or
judgment from which no further right of appeal exists. It is the parties,
intention that if the Company contests Indemnitee's right to indemnification,
the question of Indemnitee's right to indemnification shall be for the court to
decide, and neither the failure of the Company (including its Board of
Directors, any committee or subgroup of the Board of Directors, independent
legal counsel, or its stockholders) to have made a determination that
indemnification of Indemnitee is proper in the circumstances because Indemnitee
has met the applicable standard of conduct required by applicable law, nor an
actual determination by the Company (including it Board of Directors, any
committee or subgroup of the Board of Directors, independent legal counsel, or
its stockholders) that Indemnitee has not met such applicable standard of
conduct, shall create a presumption that Indemnitee has or has not met the
applicable standard of conduct.

      (d) Notice to Insurers. If, at the time of the receipt of a notice of a
claim pursuant to section 2(b) hereof, the Company has director and officer
liability insurance in effect, the Company shall give prompt notice of the
commencement of such proceeding to the insurers in accordance with the
procedures set forth in the respective policies. The Company shall thereafter
take all necessary or desirable action to cause such insurers to pay, on behalf
of the Indemnitee, all amounts payable as a result of such proceeding in
accordance with the terms of such policies.

      (e) Selection of Counsel. In the event the Company shall be obligated
under Section 2(a) hereof to pay the expenses of any proceeding against
Indemnitee, the Company, if appropriate, shall be entitled to assume the defense
of such proceeding, with counsel approved by Indemnitee, upon the delivery to
Indemnitee of written notice of its election to do so. After delivery of such
notice, approval of such counsel by Indemnitee and the retention of such counsel
by the Company, the Company will not be liable to Indemnitee under this
Agreement for any fees of counsel subsequently incurred by Indemnitee with
respect to the same proceeding, provided that (i) Indemnitee shall have the
right to employ his counsel in any such proceeding at Indemnitee's expense; and
(ii) if (A) the employment of counsel by Indemnitee has been previously
authorized by the Company, (B) Indemnitee shall have reasonably concluded that
there may be a conflict of interest between the Company and Indemnitee in the
conduct of any such defense, or (C) the Company shall not, in fact, have
employed counsel to assume the defense of such proceeding, then the fees and
expenses of Indemnitee's counsel shall be at the expense of the Company.

                                       3
<PAGE>

3. ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.

      (a) Scope. Notwithstanding any other provision of this Agreement, the
Company hereby agrees to indemnify the Indemnitee to the fullest extent
permitted by law, notwithstanding that such indemnification is not specifically
authorized by the other provisions of this Agreement, the Company's Certificate
of Incorporation, the Company's Bylaws or by statute. In the event of any
change, after the date of this Agreement, in any applicable law, statute, or
rule which expands the right of a Delaware corporation to indemnify a member of
its board of directors or an officer, such changes shall be, ipso facto, within
the purview of Indemnitee's rights and Company's obligations, under this
Agreement. In the event of any change in any applicable law, statute or rule
which narrows the right of a Delaware corporation to indemnify a member of its
board of directors or an officer, such changes, to the extent not otherwise
required by such law, statute or rule to be applied to this Agreement shall have
no effect on this Agreement or the parties' rights and obligations hereunder.

      (b) Nonexclusivity. The indemnification provided by this Agreement shall
not be deemed exclusive of any rights to which Indemnitee may be entitled under
the Company's Certificate of Incorporation, its Bylaws, any agreement, any vote
of stockholders or disinterested Directors, the General Corporation Law of the
State of Delaware, or otherwise, both as to action in Indemnitee's official
capacity and as to action in another capacity while holding such office. The
indemnification provided under this Agreement shall continue as to Indemnitee
for any action taken or not taken while serving in an indemnified capacity even
though he may have ceased to serve in such capacity at the time of any action,
suit or other covered proceeding.

4. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of the
expenses, judgments, fines or penalties actually or reasonably incurred by him
in the investigation, defense, appeal or settlement of any civil or criminal
action, suit or proceeding, but not, however, for the total amount thereof, the
Company shall nevertheless indemnify Indemnitee for the portion of such
expenses, judgments, fines or penalties to which Indemnitee is entitled.

5. MUTUAL ACKNOWLEDGEMENT. Both the Company and Indemnitee acknowledge that in
certain instances, Federal law or applicable public policy may prohibit the
Company from indemnifying its directors and officers under this Agreement or
otherwise. Indemnitee understands and acknowledges that the Company has
undertaken or may be required in the future to undertake with the Securities and
Exchange Commission to submit the question of indemnification to a court in
certain circumstances for a determination of the Company's right under public
policy to indemnify Indemnitee.

                                       4
<PAGE>

6. OFFICER AND DIRECTOR LIABILITY INSURANCE. The Company shall, from time to
time, make the good faith determination whether or not it is practicable for the
Company to obtain and maintain a policy or policies of insurance with reputable
insurance companies providing the officers and directors of the Company with
coverage for losses from wrongful acts, or to ensure the Company's performance
of its indemnification obligations under this Agreement. Among other
considerations, the Company will weigh the costs of obtaining such insurance
coverage against the protection afforded by such coverage. In all policies of
director and officer liability insurance, Indemnitee shall be named as an
insured in such a manner as to provide Indemnitee the same rights and benefits
as are accorded to the most favorably insured of the Company's directors, if
Indemnitee is a director; or of the Company's officers, if Indemnitee is not a
director of the Company but is an officer. Notwithstanding the foregoing, the
Company shall have no obligation to obtain or maintain such insurance if the
Company determines in good faith that such insurance is not reasonably
available, if the premium costs for such insurance are disproportionate to the
amount of coverage provided, if the coverage provided by such insurance is
limited by exclusions so as to provide an insufficient benefit, or if Indemnitee
is covered by similar insurance maintained by a subsidiary or parent of the
Company.

7. SEVERABILITY. Nothing in this Agreement is intended to require or shall be
construed as requiring the Company to do or fail to do any act in violation of
applicable law. The Company's inability, pursuant to court order, to perform its
obligations under this Agreement shall not constitute a breach of this
Agreement. The provisions of this Agreement shall be severable as provided in
this Section 7. If this Agreement or any portion hereof shall be invalidated on
any ground by any court of competent jurisdiction, then the Company shall
nevertheless indemnify Indemnitee to the full extent permitted by any applicable
portion of this Agreement that shall not have been invalidated, and the balance
of this Agreement not so invalidated shall be enforceable in accordance with its
terms.

8. EXCEPTIONS. Any other provision herein to the contrary notwithstanding, the
Company shall not be obligated pursuant to the terms of this Agreement:

      (a) Claims Initiated by Indemnitee. To indemnify or advance expenses to
Indemnitee with respect to proceedings or claims initiated or brought
voluntarily by Indemnitee and not by way of defense, except with respect to
proceedings brought to establish or enforce a right to indemnification under
this Agreement or any other statute or law or otherwise as required under
Section 145 of the Delaware General Corporation Law, but such indemnification or
advancement of expenses may be provided by the Company in specific cases if the
Board of Directors has approved the initiation or bringing of such suit; or

      (b) Lack of Good Faith. To indemnify Indemnitee for any expenses incurred
by the Indemnitee with respect to any proceeding instituted by Indemnitee to
enforce or interpret this Agreement, if a court of competent jurisdiction
determines that each of the material assertions made by the Indemnitee in such
proceeding was not made in good faith or was frivolous; or

                                       5
<PAGE>

      (c) Insured claims. To indemnify Indemnitee for expenses or liabilities of
any type whatsoever (including, but not limited to, judgments, fines, ERISA
excise taxes or penalties, and amounts paid in settlement) which have been paid
directly to Indemnitee by an insurance carrier under a policy of officers' and
directors' liability insurance maintained by the Company.

      (d) Claims Under Section 16(b). To indemnify Indemnitee for expenses and
the payment of profits arising from the purchase and sale by Indemnitee of
securities in violation of Section 16(b) of the Securities Exchange Act of 1934,
as amended, or any similar successor statute.

9. CONSTRUCTION OF CERTAIN PHRASES.

      (a) For purposes of this Agreement, references to the "Company" shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, and employees or agents, so that
if Indemnitee is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, Indemnitee shall stand in
the same position under the provisions of this Agreement with respect to the
resulting or surviving corporation as Indemnitee would have with respect to such
constituent corporation if its separate existence had continued.

      (b) For purposes of this Agreement, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on Indemnitee with respect to an employee benefit plan;
and references to "serving at the request of the Company" shall include any
service as a director, officer, employee or agent of the Company which imposes
duties on, or involves services by, such director, officer, employee or agent
with respect to an employee benefit plan, its participants, or beneficiaries;
and if Indemnitee acted in good faith and in a manner Indemnitee reasonably
believed to be in the interest of the participants and beneficiaries of an
employee benefit plan, Indemnitee shall be deemed to have acted in a manner "not
opposed to the best interests of the Company" as referred to in this Agreement.

10. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which shall constitute an original.

11. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Company and
its successors and assigns, and shall inure to the benefit of Indemnitee and
Indemnitee's estate, heirs, legal representatives and assigns.

12. ATTORNEYS' FEES. In the event that any action is instituted by Indemnitee
under this Agreement to enforce or interpret any of the terms hereof, Indemnitee
shall be entitled to be paid all court costs and expenses, including reasonable
attorneys' fees, incurred by Indemnitee with respect to such action, unless as a
part of such action, the court of competent jurisdiction determines that each of
the material assertions made by Indemnitee as a basis for such action were not
made in good faith or were frivolous. In the event of an action instituted by or
in the name of the Company under this Agreement or to enforce or interpret any
of the terms of this Agreement, Indemnitee shall be entitled to be paid all
court costs and expenses, including attorneys' fees, incurred by Indemnitee in
defense of such action (including with respect to Indemnitee's counterclaims and
cross claims made in such action), unless as a part of such action the court
determines that each of Indemnitee's material defenses to such action were made
in bad faith or were frivolous.

                                       6
<PAGE>

13. NOTICE. All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed duly given (i) if delivered by
hand and receipted for by the party addressee, on the date of such receipt, or
(ii) if mailed by domestic certified or registered mail with postage prepaid, on
the third business day after the date postmarked. Addresses for notice to either
party are as shown on the signature page of this Agreement, or as subsequently
modified by written notice.

14. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably
consent to the jurisdiction of the courts of the State of Delaware for all
purposes in connection with any action or proceeding which arises out of or
relates to this Agreement and agree that any action instituted under this
Agreement shall be brought only in the state courts of the State of Florida.

15. CHOICE OF LAW. This Agreement shall be governed by and its provisions
construed in accordance with the laws of the State of Delaware, as applied to
contracts between Delaware residents entered into and to be performed entirely
within Delaware without regard to the conflict of law principles thereof.

16. PERIOD OF LIMITATIONS. No legal action shall be brought and no cause of
action shall be asserted by or in the right of the Company against Indemnitee,
Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of two years from the date of accrual of
such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such two-year period; provided, however, that if any shorter
period of limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.

17. SUBROGATION. In the event of payment under this Agreement, the Company shall
be subrogated to the extent of such payment to all of the rights of recovery of
Indemnitee, who shall execute all documents required and shall do all acts that
may be necessary to secure such rights and to enable the Company effectively to
bring suit to enforce such rights.

18. AMENDMENT AND TERMINATION. No amendment, modification, termination or
cancellation of this Agreement shall be effective unless it is in writing signed
by both the parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provisions hereof
(whether or not similar) nor shall such waiver constitute a continuing waiver.

                                       7
<PAGE>

19. INTEGRATION AND ENTIRE AGREEMENT. This Agreement sets forth the entire
understanding between the parties hereto and supersedes and merges all previous
written and oral negotiations, commitments, understandings and agreements
relating to the subject matter hereof between the parties hereto

      IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.


                                  DYADIC  INTERNATIONAL,  INC.,  a  Delaware
                                  corporation


                                  By:______________________________________
                                        Mark A. Emalfarb
                                        Chief Executive Officer


                                  By:______________________________________
                                        Robert Shapiro


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>ex99-2.txt
<TEXT>
                         EXECUTIVE EMPLOYMENT AGREEMENT

      THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made and entered into
as of the 30th day of March, 2005, by and between DYADIC INTERNATIONAL, INC., a
Delaware corporation (the "Company"), and Kent M. Sproat (the "Executive"). The
Company and the Executive are sometimes hereinafter collectively referred to as
the "parties" and individually as a "party," provided that as applicable, any
reference to the Company shall mean the Company, its Subsidiaries and and\or
their Affiliates, as the case may be. Certain capitalized terms used in this
Agreement are defined in Article VII hereof.

                                    RECITALS

      A. The Executive is currently employed by the Company as the Company's
Vice President, Manufacturing. The Compensation Committee of the Board of
Directors ("Board") of the Company (the "Compensation Committee") recently
reviewed the Executive's job performance in calendar year 2004, and made a
number of favorable determinations regarding Executive's job performance.

      B. The Company maintains the "Dyadic International, Inc. 2001 Equity
Compensation Plan" (as the same may be amended, restated or otherwise modified,
the "Equity Compensation Plan") pursuant to which the Company is authorized to
grant stock options to purchase shares of Common Stock of the Company ("Shares")
to employees, officers, directors, consultants and advisors of the Company and
its Subsidiaries.

      C. Among the determinations of the Compensation Committee were that,
subject to the satisfaction of the condition set forth in Recital D hereof, it
would be in the best interests of the Company to: (i) promote the Executive to
the position of Executive Vice President, Enzymes Business, increase the
Executive's annual base compensation and confer upon the Executive the benefits
of certain post-employment severance benefits provided for in this Agreement;
and (ii) incentivize and reward the Executive's efforts, loyalty and commitment
to the Company, by granting to the Executive a certain stock option to purchase
Shares (the "Option") under and pursuant to the terms of the Equity Compensation
Plan and a Stock Option Agreement in the form of Exhibit A attached hereto and
by this reference made a part hereof (the "Stock Option Agreement").

      D. As a condition of that promotion, and as partial consideration for that
salary increase and the grant of the Option, the Company requires that this
Agreement be entered into pursuant to which the Executive is hereby knowingly
and intentionally furnishing the Company with, among other things, the suite of
proprietary covenants of the Executive in favor of the Company set forth in
Article IV hereof, including by way of illustration, and not in limitation, the
Executive's covenant not to compete with the businesses of the Company, its
Subsidiaries and their Affiliates.

      E. The Executive desires to be promoted to the position of Executive Vice
President, Enzymes Business, to receive the salary increase and other financial
benefits of this Agreement and the grant of the Option. Further, the Executive
expressly acknowledges that: (i) as a member of the Company's management, he is
one of the persons charged with primary responsibility for the implementation of
the Company's business plans, and that he will have regular access to various
confidential and/or proprietary information relating to the Company, its
Subsidiaries, their Affiliates and their businesses; and (ii) the suite of
proprietary covenants of the Executive in favor of the Company set forth in
<PAGE>

Article IV hereof which the Executive is knowingly and intentionally furnishing
to the Company, including by way of illustration, and not in limitation, the
Executive's covenant not to engage in competition with the Company, its
Subsidiaries, their Affiliates and their businesses, are (A) being made both in
consideration of the Company's promotion, increase in the annual base salary of
and the grant of the Option to the Executive and (B) necessary to protect the
legitimate business interests of the Company, its Subsidiaries and Affiliates
and their respective businesses.

                                    AGREEMENT

      NOW, THEREFORE, in consideration of the foregoing recitals, and the mutual
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby mutually acknowledged, the parties
hereby agree as follows:

                                    ARTICLE I
                             EMPLOYMENT RELATIONSHIP

      1.1 Recitals.  The Recitals to this Agreement are hereby  incorporated
herein and made a part hereof.

      1.2 Employment. Subject to the terms and conditions of this Agreement, the
Company hereby agrees to employ the Executive to serve as (i) the Company's
Executive Vice President, Enzymes Business, and (ii) the Executive Vice
President of the Company's principal operating Subsidiary, Dyadic International
(USA), Inc. ("Dyadic-Florida), with responsibility for all manufacturing,
applications, sales, marketing and accounting functions of the Company or any
Subsidiary or Affiliate of the Company which serve industrial or commercial
enzyme markets (the "Enzymes Business"), and the Executive hereby accepts such
employment, and agrees to perform all of his assigned duties and
responsibilities to the best of his abilities in a diligent, trustworthy,
businesslike and efficient manner, and in compliance with the Dyadic
International, Inc. Code of Business Conduct and Ethics, a copy of which appears
on the Company's website.

      1.3 Duties; Reporting Authority. The Executive shall have the normal and
customary duties, responsibilities and authority of a Person holding the title
and job description set forth in Section 1.2 hereof, and in addition, shall
perform such other duties on behalf of the Company, Dyadic-Florida, their
Subsidiaries and their Affiliates as may be assigned to him by the Chief
Executive Officer, the Chief Operating Officer or President of the Company, by
the Board or by the Board of Directors of Dyadic-Florida. In connection with the
Executive's performance of his duties he shall report to the Chief Executive
Officer, the Chief Operating Officer or President of the Company or to such
other Person as the Chief Executive Officer, Chief Operating Officer or
President of the Company, the Board or the Board of Directors of Dyadic-Florida
may designate from time to time.

      1.4 Exclusive Employment. While he is employed by the Company hereunder,
the Executive covenants to the Company that he will devote his entire business
time, energy, attention and skill to the Company, its Subsidiaries and their
Affiliates (except for permitted vacation periods and reasonable periods of
illness or other incapacity), and use his good faith best efforts to promote the
interests of the Company, its Subsidiaries and their Affiliates. The foregoing
shall not be construed as prohibiting the Executive from spending such time as
may be reasonably necessary to attend to his personal affairs and investments so
long as such activities do not conflict or interfere with the Executive's

                                       2
<PAGE>

obligations and\or timely performance of his duties to the Company, its
Subsidiaries and their Affiliates hereunder.

      1.5   Executive Representations.     The  Executive  hereby   represents
and warrants to the Company that:

            (a) the execution, delivery and performance by the Executive of this
      Agreement and any other agreements contemplated hereby to which the
      Executive is a party do not and shall not conflict with, breach, violate
      or cause a default under any contract, agreement, instrument, order,
      judgment or decree to which the Executive is a party or by which he is
      bound;

            (b) the Executive is not a party to or bound by any employment
      agreement, non-competition agreement or confidentiality agreement with any
      other Person (or if a party to such an agreement, the Executive has
      disclosed the material terms thereof to the Compensation Committee prior
      to the execution hereof and promptly after the date hereof shall deliver a
      copy of such agreement to the Compensation Committee); and

            (c) upon the execution and delivery of this Agreement by the
      Company, this Agreement shall be the valid and binding obligation of the
      Executive, enforceable in accordance with its terms.

The Executive hereby acknowledges and represents that he has consulted with
independent legal counsel regarding his rights and obligations under this
Agreement and that he fully understands the terms and conditions contained
herein.

      1.6   Company   Representations.   The  Company  hereby  represents  and
warrants to the Executive that:

            (a) the execution, delivery and performance by the Company of this
      Agreement and any other agreements contemplated hereby to which the
      Company is a party do not and shall not conflict with, breach, violate or
      cause a default under any contract, agreement, instrument, order, judgment
      or decree to which the Company is a party or by which he is bound; and

            (b) upon the execution and delivery of this Agreement by the
      Executive, this Agreement shall be the valid and binding obligation of the
      Company, enforceable in accordance with its terms.

      1.7   Indemnification.

            (a) By the Executive. The Executive shall indemnify and hold the
      Company and its Subsidiaries and Affiliates harmless from and against any
      and all claims, demands, losses, judgments, costs, expenses, or
      liabilities incurred by the Company and/or any of its Subsidiaries or
      Affiliates arising out of or in connection with the breach of any
      representation or warranty of the Executive contained in this Agreement.

                                       3
<PAGE>

            (b) By the Company. The Company shall indemnify and hold the
      Executive harmless from and against any and all claims, demands, losses,
      judgments, costs, expenses, or liabilities incurred by the Executive
      arising out of or in connection with the breach of any representation or
      warranty of the Company contained in this Agreement. Further, the Company
      shall defend, indemnify and hold harmless the Executive (including without
      limitation, the prompt advance payment of all reasonable legal fees and
      expenses) to the fullest extent permitted by applicable law and the
      by-laws of the Company.

                                   ARTICLE II
                              PERIOD OF EMPLOYMENT

      2.1 Employment Period. The Executive is an existing employee of the
Company and shall continue to be an employee of the Company until the date fixed
by the provisions of Section 2.2 hereof, subject to the early termination
provisions of Article V hereof (the "Employment Period"), it being acknowledged
that the Company's fiscal year ends on December 31, and that the Employment
Period shall therefore be denominated in calendar years.

      2.2 Initial Term of Employment Period and Extension Terms. The Employment
Period shall initially continue until December 31, 2007 (the "Initial Term").
The Employment Period shall be automatically extended for successive calendar
years of the Company following the expiration of the Initial Term (each such one
year period being hereinafter referred to as an "Extension Term") upon the same
terms and conditions provided for herein unless either party provides the other
party with advance written notice of its or his intention not to extend the
Employment Period; provided, however, that such notice must be delivered by the
non-extending party to the other party not later than ninety (90) days prior to
the expiration of the Initial Term or any Extension Term, as the case may be.

                                   ARTICLE III
                                  COMPENSATION

      3.1 Annual Base Compensation. Effective as of April 1, 2005, and during
the balance of the Employment Period the Company shall pay to the Executive an
annual base salary (the "Annual Base Compensation") in the amount of $190,000,
provided that the Annual Base Compensation the Employee had been being paid
prior to the date of this Agreement shall remain in effect until April 1, 2005.
The Annual Base Compensation shall be paid in regular installments in accordance
with the Company's general payroll practices, and shall be subject to all
required federal, state and local withholding taxes. The Executive's Annual Base
Compensation shall be reviewed by the Chief Executive Officer and the
Compensation Committee of the Board (the "Compensation Committee") annually, and
may, in the discretion of the Chief Executive Officer and the Compensation
Committee be increased, provided that there shall be no obligation on the part
of the Company to increase the Executive's Annual Base Compensation.

                                       4
<PAGE>

      3.2 Potential Annual Target Bonuses. In respect of each calendar year
falling within the Employment Period, the Executive shall be eligible to earn an
annual bonus, depending upon the results of operation of the Company, its
Subsidiaries and their Affiliates and the personal performance of the Executive,
of up to forty percent (40%) of the Executive's Annual Base Compensation for
that calendar year (the "Potential Annual Target Bonus") in accordance with the
terms of a bonus plan which shall be adopted and maintained in effect by the
Compensation Committee for that calendar year. The amount of the Potential
Annual Target Bonus, if any, which is earned by the Executive (the "Bonusable
Amount") shall be paid by the Company to the Executive following the close of
the Company's calendar year consistent with the timing of similar bonus payments
being made to other executives of the Company for such year, provided that,
unless expressly provided otherwise herein, it shall be a condition precedent to
the Executive's right to receive any Bonusable Amount that the Executive be
employed by the Company on the last day of that calendar year, regardless of any
subsequent termination of employment. In the absolute discretion of the
Compensation Committee, the Executive may be entitled to receive an additional
bonus, as and if the Compensation Committee shall determine from time to time.

      3.3 Expenses. During the Employment Period, the Executive shall be
entitled to reimbursement of all travel, entertainment and other business
expenses reasonably incurred in the performance of his duties for the Company,
upon submission of all receipts and accounts with respect thereto, and approval
by the Company thereof, in accordance with the business expense reimbursement
policies adopted by the Company from time to time.

      3.4 Vacation. In respect of each calendar year falling within the
Employment Period, the Executive shall be entitled to four (4) weeks of
vacation, or if greater, the number of weeks of vacation proscribed by the
vacation policies of the Company then in effect from time to time, provided that
unused vacation may be used by the Executive in the following calendar year only
in accordance with and as permitted by the Company's then current vacation
policies in effect from time to time.

      3.5 Other Fringe Benefits. During the Employment Period, if, as and when
they are being provided to other employees of the Company holding positions with
the Company comparable to the Executive's position, the Executive shall also be
entitled to receive health insurance benefits, disability benefits and
retirement benefits and other fringe benefits.

      3.6 Grant of Stock Option. In part as recompense for his job performance
in 2004 and in part as additional consideration for the Executive's execution
and delivery of this Agreement, conferral upon the Company of the covenants set
forth in Article IV hereof, and the Executive's performance of his duties
hereunder, concurrently with the execution and delivery of this Agreement, the
parties are executing and delivering the Option Agreement pursuant to which the
Company has granted to the Executive an Option to purchase seventy thousand
(70,000) Shares for a per Share purchase price of equal to the mean of the final
"asked" and "bid" prices of the Shares on the date hereof, in accordance with
the provisions of the Equity Compensation Plan.

                                       5
<PAGE>

                                   ARTICLE IV
                            COVENANTS OF THE EMPLOYEE

      4.1 Proprietary Rights. The Executive hereby expressly agrees that all
research, Biological Materials, discoveries, inventions and innovations (whether
or not reduced to practice or documented), improvements, developments, methods,
designs, analyses, drawings, reports and all similar or related information
(whether patentable or unpatentable, and whether or not reduced to writing),
trade secrets (being information about the business of the Company, its
Subsidiaries and their Affiliates which is considered by the Company or any such
Subsidiary or Affiliate to be confidential and is proprietary to the Company or
any such Subsidiary or Affiliate) and confidential information, copyrightable
works, and similar and related information (in whatever form or medium), which
(x) either (i) relate to the Company's, its Subsidiaries' or their Affiliates'
actual or anticipated business, research and development or existing or future
products or services or (ii) result from any work performed by the Executive for
the Company, its Subsidiaries or any of their Affiliates and (y) are conceived,
developed, made or contributed to in whole or in part by the Executive during
the Employment Period ("Work Product") shall be and remain the sole and
exclusive property of the Company, such Subsidiary or such Affiliate, as the
case may be. The Executive shall communicate promptly and fully all Work Product
to the Company.

            (a) Work Made for Hire. The Executive acknowledges that, unless
      otherwise agreed in writing by the Company, all Work Product eligible for
      any form of copyright protection made or contributed to in whole or in
      part by the Executive within the scope of the Executive's employment by
      the Company during the Employment Period shall be deemed a "work made for
      hire" under the copyright laws and shall be owned by the Company, its
      Subsidiaries or their Affiliates, as applicable.

            (b) Assignment of Proprietary Rights. The Executive hereby assigns,
      transfers and conveys to the Company, and shall assign, transfer and
      convey to the Company, all right, title and interest in and to all
      inventions, ideas, improvements, designs, processes, trademarks, service
      marks, trade names, trade secrets, trade dress, data, discoveries and
      other proprietary assets and proprietary rights in and of the Work Product
      (the "Proprietary Rights") for the Company's exclusive ownership and use,
      together with all rights to sue and recover for past and future
      infringement or misappropriation thereof, provided that if a Subsidiary or
      Affiliate of the Company is the owner thereof, such assignment, transfer
      and conveyance shall be made to such Subsidiary or Affiliate, , as the
      case may be, which shall enjoy exclusive ownership and use, together with
      all rights to sue and recover for past and future infringement or
      misappropriation thereof.

            (c) Further Instruments. At the request of the Company (its
      Subsidiaries or their Affiliates, as the case may be), at all times during
      the Employment Period and thereafter, the Executive will promptly and
      fully assist the Company (its Subsidiaries or their Affiliates, as the
      case may be) in effecting the purpose of the foregoing assignment,
      including but not limited to the further acts of executing any and all
      documents necessary to secure for the Company (its Subsidiaries or their
      Affiliates, as the case may be) such Proprietary Rights and other rights
      to all Work Product and all confidential information related thereto,
      providing cooperation and giving testimony.

                                       6
<PAGE>

            (d) Inapplicability of Section 4.1 In Certain Circumstances. The
      Company expressly acknowledges and agrees that, and the Executive is
      hereby advised that, this Section 4.1 does not apply to any invention for
      which no equipment, supplies, facilities or trade secret information of
      the Company, its Subsidiaries or any of their Affiliates was used and
      which was developed entirely on the Executive's own time, unless (i) the
      invention relates to the business of the Company, its Subsidiaries or any
      of their Affiliates or to the Company's, its Subsidiaries' or any of their
      Affiliates' actual or demonstrably anticipated research or development or
      (ii) the invention results from any work performed by the Executive for
      the Company, its Subsidiaries or any of their Affiliates.

      4.2 Ownership and Covenant to Return Documents, etc. The Executive agrees
that all Work Product and all documents or other tangible materials (whether
originals, copies or abstracts), including without limitation, price lists,
quotation guides, outstanding quotations, books, records, manuals, files, sales
literature, training materials, customer records, correspondence, computer disks
or print-out documents, contracts, orders, messages, phone and address lists,
invoices and receipts, and all objects associated therewith, which in any way
relate to the business or affairs of the Company, its Subsidiaries and their
Affiliates either furnished to the Executive by the Company, its Subsidiaries or
any of their Affiliates or are prepared, compiled or otherwise acquired by the
Executive during the Employment Period, shall be the sole and exclusive property
of the Company, such Subsidiaries or such Affiliates, as the case may be. The
Executive shall not, except for the use of the Company, its Subsidiaries or any
of their Affiliates, use, copy or duplicate any of the aforementioned documents
or objects, nor remove them from the facilities of the Company or such
Subsidiaries or such Affiliates, , as the case may be, nor use any information
concerning them except for the benefit of the Company, its Subsidiaries and
their Affiliates, either during the Employment Period or thereafter. The
Executive agrees that he will deliver all of the aforementioned documents and
objects that may be in his possession to the Company on the termination of his
employment with the Company, or at any other time upon the Company's request,
together with his written certification of compliance with the provisions of
this Section 4.2 in the form of Exhibit B to this Agreement in accordance with
the provisions of Section 5.3 hereof.

      4.3 Non-Disclosure Covenant. For a period commencing on the date of this
Agreement and ending on the last to occur of five (5) years following the date
of execution of this Agreement or three (3) years following the date of the
termination of the Employment Period (the "Non-Disclosure Period"), the
Executive shall not, either directly or indirectly, disclose to any
"unauthorized person" or use for the benefit of the Executive or any Person
other than the Company, its Subsidiaries or their Affiliates any Work Product or
any knowledge or information which the Executive may acquire while employed by
the Company (whether before or after the date of this Agreement) relating to (i)
the financial, marketing, sales and business plans and affairs, financial
statements, analyses, forecasts and projections, books, accounts, records,
operating costs and expenses and other financial information of the Company, its
Subsidiaries and their Affiliates, (ii) internal management tools and systems,
costing policies and methods, pricing policies and methods and other methods of

                                       7
<PAGE>

doing business, of the Company, its Subsidiaries and their Affiliates, (iii)
customers, sales, customer requirements and usages, distributor lists, of the
Company, its Subsidiaries and their Affiliates, (iv) agreements with customers,
vendors, independent contractors, employees and others, of the Company, its
Subsidiaries and their Affiliates, (v) existing and future products or services
and product development plans, designs, analyses and reports, of the Company,
its Subsidiaries and their Affiliates, (vi) computer software and data bases
developed for the Company, its Subsidiaries or their Affiliates, trade secrets,
research, records of research, models, designs, drawings, technical data and
reports of the Company, its Subsidiaries and their Affiliates and (vii)
correspondence or other private or confidential matters, information or data
whether written, oral or electronic, which is proprietary to the Company, its
Subsidiaries and their Affiliates and not generally known to the public
(individually and collectively "Confidential Information"), without the
Company's prior written permission. For purposes of this Section 4.3, the term
"unauthorized person" shall mean any Person who is not (i) an officer or
director of the Company or an employee of the Company for whom the disclosure of
the knowledge or information referred to herein is necessary for his performance
of his assigned duties, or (ii) an employee, officer or director of a Subsidiary
or Affiliate of the Company for whom the disclosure of the knowledge or
information referred to herein is necessary for his performance of his assigned
duties, or (iii) a Person expressly authorized by the Company to receive
disclosure of such knowledge or information. The Company expressly acknowledges
and agrees that the term "Confidential Information" excludes information which
is (A) in the public domain or otherwise generally known to the trade, or (B)
disclosed to third parties other than by reason of the Executive's breach of his
confidentiality obligation hereunder or (C) learned of by the Executive
subsequent to the termination of his employment hereunder from any other party
not then under an obligation of confidentiality to the Company, its Subsidiaries
and their Affiliates. Further, the Executive covenants to the Company that in
the Executive's performance of his duties hereunder, the Executive will violate
no confidentiality obligations he may have to any third Persons.

      4.4 Non-Interference Covenants. The Executive covenants to the Company
that while the Executive is employed by the Company hereunder and for the two
(2) year period thereafter (the "Non-Interference Period"), he will not, for any
reason, directly or indirectly: (a) solicit, hire, or otherwise do any act or
thing which may induce any other employee of the Company, its Subsidiaries or
their Affiliates to leave the employ or otherwise interfere with or adversely
affect the relationship (contractual or otherwise) of the Company, its
Subsidiaries and their Affiliates with any person who is then or thereafter
becomes an employee of the Company, its Subsidiaries and their Affiliates; (b)
do any act or thing which may interfere with or adversely affect the
relationship (contractual or otherwise) of the Company, its Subsidiaries and
their Affiliates with any vendor of goods or services to the Company, its
Subsidiaries and their Affiliates or induce any such vendor to cease doing
business with the Company, its Subsidiaries and their Affiliates; or (c) except
for Competitive Activities (as defined in Section 4.5) engaged in by the
Employee after the expiration of the Non-Competition Period, do any act or thing
which may interfere with or adversely affect the relationship (contractual or
otherwise) of the Company, its Subsidiaries and their Affiliates with any
customer of the Company, its Subsidiaries and their Affiliates or induce any
such customer to cease doing business with the Company, its Subsidiaries and
their Affiliates.

      4.5 Covenant Not To Compete. The Executive expressly acknowledges that (i)
the Executive's performance of his services for the Company hereunder will
afford him or her access to and cause him or her to become highly knowledgeable
about the Company's, its Subsidiaries' and their Affiliates' Confidential

                                       8
<PAGE>

Information; (ii) the agreements and covenants contained in this Section 4.5 are
essential to protect the Confidential Information, business and goodwill of the
Company, its Subsidiaries and their Affiliates, and the restraints on the
Executive imposed by the provisions of this Section 4.5 are justified by these
legitimate business interests of the Company; and (iii) his covenants to the
Company, its Subsidiaries and their Affiliates set forth in this Section 4.5 are
being made both in consideration of the Company's employment of the Executive in
the office to which the Executive has been promoted, the salary increase and
other financial benefits of this Agreement and the grant of the Option.
Accordingly, the Executive hereby agrees that during the Non-Competition Period
he shall not, anywhere in the Applicable Territory, directly or indirectly, own
any interest in, invest in, lend to, borrow from, manage, control, participate
in, consult with, become employed by, render services to, or in any other manner
whatsoever engage in, any business which is competitive with any lines of
business actively being engaged in by the Company, its Subsidiaries and their
Affiliates in the Applicable Territory or actively (and demonstrably) being
considered by the Company, its Subsidiaries and their Affiliates for entry into
on the date of the termination of the Employment Period (collectively,
"Competitive Activities"). The preceding to the contrary notwithstanding, the
Executive shall be free to make investments in the publicly traded securities of
any corporation, provided that such investments do not amount to more than 1% of
the outstanding securities of any class of such corporation.

      4.6 Remedies For Breach. If the Executive commits a breach, or threatens
to commit a breach, of any of the provisions of this Article IV, the Company and
its Subsidiaries shall have the right and remedy, in addition to any other
remedy that may be available at law or in equity, to have the provisions of this
Article IV specifically enforced by any court having equity jurisdiction, by the
entry of temporary, preliminary and permanent injunctions and orders of specific
performance, together with an accounting therefor, it being expressly
acknowledged and agreed by the Executive that any such breach or threatened
breach will cause irreparable injury to the Company and its Subsidiaries and
that money damages will not provide an adequate remedy to the Company and its
Subsidiaries. Any such injunction shall be available without the posting of any
bond or other security, and the Executive hereby consents to the issuance of
such injunction. The Executive further agrees that any such injunctive relief
obtained by the Company or its Subsidiaries shall be in addition to, and not in
lieu of, monetary damages and any other remedies to which the Company or its
Subsidiaries may be entitled. Further, in the event of an alleged breach or
violation by the Executive of any of the provisions of Sections 4.3, 4.4 or 4.5
hereof, the Non-Disclosure Period, the Non-Interference Period and\or the
Non-Competition Period, as the case may be, shall be tolled until such breach or
violation has been cured. The parties agree that in the event of the institution
of any action at law or in equity by either party to enforce the provisions of
this Article IV, the losing party shall pay all of the costs and expenses of the
prevailing party, including reasonable legal fees, incurred in connection
therewith. If any covenant contained in this Article IV or any part thereof is
hereafter construed to be invalid or unenforceable, the same shall not affect
the remainder of such covenant or any other covenants, which shall be given full
effect, without regard to the invalid portions, and any court having
jurisdiction shall have the power to modify such covenant to the least extent
necessary to render it enforceable and, in its modified form, said covenant
shall then be enforceable.

                                       9
<PAGE>

                                    ARTICLE V
                            TERMINATION OF EMPLOYMENT

      5.1 Termination and Triggering Events. Notwithstanding anything to the
contrary elsewhere contained in this Agreement, the Employment Period shall
terminate at the expiration of the Initial Term or any Extension Term, or prior
to the expiration of the Initial Term or any Extension Term upon the occurrence
of any of the following events (hereinafter referred to as "Triggering Events"):
(a) the Executive's death; (b) the Executive's Total Disability; (c) the
Executive's Resignation; (d) a Termination by the Company for Cause; or (f) a
Termination by the Company Without Cause.

      5.2 Rights Upon Occurrence of a Triggering Event. Subject to the
provisions of Section 5.3 hereof, the rights of the parties upon the occurrence
of a Triggering Event prior to the expiration of the Initial Term or any
Extension Term shall be as follows:

            (a) Resignation and Termination by the Company for Cause: If the
      Triggering Event was the Executive's Resignation or a Termination by the
      Company for Cause, the Executive shall be entitled to receive his Annual
      Base Compensation and accrued but unpaid vacation through the date thereof
      in accordance with the policy of the Company, and to continue to
      participate in the Company's health, insurance and disability plans and
      programs through that date and thereafter, only to the extent permitted
      under the terms of such plans and programs.

            (b) Death or Total Disability: If the Triggering Event was the
      Executive's death or Total Disability, the Executive (or the Executive's
      designated beneficiary) shall be entitled to receive the Executive's
      Annual Base Compensation and accrued but unpaid vacation through the date
      thereof plus a pro rata portion of the Executive's Potential Annual Target
      Bonus for the calendar year in which such death or Total Disability
      occurred (based on the number of days the Executive was employed during
      the applicable calendar year), in accordance with the policy of the
      Company, and to continue to participate in the Company's health, insurance
      and disability plans and programs through the date of termination and
      thereafter only to the extent permitted under the terms of such plans and
      programs.

            (c) Termination by Company Without Cause: If the Triggering Event
      was a Termination by the Company Without Cause, the Executive shall be
      entitled to receive his Annual Base Compensation and accrued but unpaid
      vacation through the date thereof plus, in the reasonable discretion of
      the Chief Executive Officer based upon whether it then appears the
      Potential Annual Target Bonus for the year would have been earned by the
      Executive had he remained employed by the Company, a pro rata portion of
      the Executive's Potential Annual Target Bonus for the calendar year in
      which such Triggering Event occurred (based on the number of days the

                                       10
<PAGE>

      Executive was employed during the applicable calendar year), payable in
      accordance with the Company's normal payroll practices, provided that in
      addition, for each month of the Severance Period hereinafter referred to,
      the Executive shall also be paid an amount per month equal to one-twelfth
      (1/12th) of his then current Annual Base Compensation in weekly,
      bi-monthly or monthly installments, as the case may be, consistent with
      the Company's normal payroll practices, commencing with the first regular
      payroll payment date following the termination of the Employment Period
      (collectively, the "Additional Severance Benefits"); further provided that
      the Executive shall be entitled to receive such Additional Severance
      Benefits during the Severance Period if and only if the Executive has
      executed and delivered to the Company the General Release substantially in
      form and substance as set forth in Exhibit C to this Agreement and only so
      long as the Executive has not breached any of his covenants to the Company
      set forth in Article IV of this Agreement.

            (d) Cessation of Entitlements and Company Right of Offset. Except as
      otherwise expressly provided herein, all of the Executive's rights to
      salary, employee benefits, fringe benefits and bonuses hereunder (if any)
      which would otherwise accrue after the termination of the Employment
      Period shall cease upon the date of such termination. The Company may
      offset any loans, cash advances or fixed amounts which the Executive owes
      the Company or its Affiliate against any amounts it owes the Executive
      under this Agreement.

      5.3 Survival of Certain Obligations and Termination Certificate. The
provisions of Articles IV, V, VI and VIII shall survive any termination of the
Employment Period, whether by reason of the occurrence of a Triggering Event or
the expiration of the Initial Term or any Extension Term. Immediately following
the termination of the Employment Period, the Executive shall promptly return to
the Company all property required to be returned to the Company pursuant to the
provisions of Section 4.2 hereof and execute and deliver to the Company the
Termination Certificate attached hereto as Exhibit B and by this reference made
a part hereof.

                                   ARTICLE VI
                                   ASSIGNMENT

      6.1 Prohibition of Assignment by Executive. The Executive expressly agrees
for himself and on behalf of his executors, administrators and heirs, that this
Agreement and his obligations, rights, interests and benefits hereunder shall
not be assigned, transferred, pledged or hypothecated in any way by the
Executive, his executors, administrators or heirs, and shall not be subject to
execution, attachment or similar process. Any attempt to assign, transfer,
pledge, hypothecate or otherwise dispose of this Agreement or any such rights,
interests and benefits thereunder contrary to the foregoing provisions, or the
levy of any attachment or similar process thereupon shall be null and void and
without effect and shall relieve the Company of any and all liability hereunder.

      6.2 Right of Company to Assign. Except as provided in the next sentence,
the rights, but not the obligations of the Company shall be assignable and
transferable to any successor-in-interest without the consent of the Executive.
In the instance of a sale of the Company or the sale of all or substantially all
of the assets of the Company or the Enzymes Business, this Agreement and the
rights and obligations of the Company hereunder may be assigned to the acquiring
party without the Executive's consent, and for purposes of this Agreement, such
acquirer shall thereafter be deemed to be the Company.

                                       11
<PAGE>

                                   ARTICLE VII
                                   DEFINITIONS

      "Affiliate" means, with respect to any Person, any other Person directly
or indirectly controlling, controlled by, or under common control with that
Person, provided that, for purposes of this definition, the terms "controls,"
"controlled by," or "under common control with" shall mean that Person's
possession, directly or indirectly, of the power or right, alone or together
with one or more partners or co-joint venturers, to direct or cause the
direction of the management and policies of such other Person through
representation on its controlling management and policy-making body or
otherwise, whether through the ownership of voting securities, by contract or
otherwise.

      "Applicable Territory" means the United States of America and each other
country in which the Company, any of its Subsidiaries or any of their Affiliates
is actively engaged in the conduct of one or more lines of business.

      "Board" means the Board of Directors of the Company.

      "Biological Materials" means (i) classical or genetically modified
strains, micro or other organisms, genes, proteins, peptides, sugars,
metabolites, small molecules, enzymes or DNA, vectors, plasmids, promoters,
expression cassettes or other genomic tools and assay materials which are being
worked with or on by the Company, its Subsidiaries or any of their Affiliates or
which are being worked with or on the Company's, its Subsidiaries' or any of
their Affiliates' behalf by the Company's, its Subsidiaries' or any of their
Affiliates' advisors, research and business collaborators, and (ii) "Biological
Materials" and fermentation or other manufacturing processes being utilized by
the Company, its Subsidiaries or any of their Affiliates, the Company's, its
Subsidiaries' or any of their Affiliates' research or business collaborators or
the Company's, its Subsidiaries' or any of their Affiliates' third party
manufactures for research, pilot scale and/or commercial manufacture of
biotechnology and other products.

      "Change of Control" means the occurrence of any of the following events:

            (i) a sale, lease, exchange or other transfer (in one transaction or
      a series of related transactions) of all or substantially all of the
      assets of the Company;

            (ii) there shall be consummated any consolidation or merger of the
      Company with any other Person other than a merger or consolidation of the
      Company in which the holders of Company's outstanding voting securities
      ordinarily having the right to vote for the election of directors
      immediately prior to such merger or consolidation directly or indirectly
      possess, immediately following such merger or consolidation, not less than
      a majority of the outstanding voting securities of the surviving
      corporation ordinarily having the right to vote for the election of
      directors;

            (iii) any "person" or "group" (as such terms are used in Section
      13(d) and 14(d) of the Exchange Act of 1934, as amended (the "Exchange
      Act")) not today a beneficial owner (as defined in Rule 13d-3 under the
      Exchange Act) of voting securities of the Company ordinarily having the
      right to vote for the election of directors, becomes the beneficial owner,

                                       12
<PAGE>

      directly or indirectly, of securities of the Company representing more
      than 50% of the combined voting power of the Company's then outstanding
      voting securities having that right to vote for the election of directors,
      provided that no Change of Control shall be deemed to have occurred as a
      result of any acquisition of voting securities directly from the Company
      (or as the result of the exercise, conversion or exchange of any
      securities acquired directly from the Company) if the transaction pursuant
      to which such voting securities or exercisable, convertible or
      exchangeable securities are issued is approved by the vote of at least a
      majority of the directors who were members of the Board one calendar month
      prior to the date of the Board's approval of such transaction;

            (iv) a sale, lease, exchange or other transfer (in one transaction
      or a series of related transactions) of all or substantially all of the
      assets used in the conduct of the Enzymes Business to any Person which,
      following the consummation of that transaction, is not an Affiliate of the
      Company, provided that the sale or license of the Company's C1 Host
      Technology incident to which the Company, or any Subsidiary or Affiliate
      of the Company, retains a right to use the C1 Host Technology and/or any
      application or derivation thereof for use in the conduct of the Enzymes
      Business shall not constitute a sale, lease, exchange or other transfer of
      the assets used in the Enzymes Business to which this clause (iv) shall
      apply; or

            (v) there shall be consummated any consolidation or merger of any
      Subsidiary or Affiliate of the Company that owns substantially all of the
      assets used in the conduct of the Enzymes Business with any Person, if the
      entity surviving that consolidation or merger is not an Affiliate of the
      Company, provided that the merger or consolidation of any Subsidiary or
      Affiliate that holds legal title to the Company's C1 Host Technology
      incident to which the Company, or any Subsidiary or Affiliate of the
      Company, retains a right to use the C1 Host Technology and/or any
      application or derivation thereof for use in the conduct of the Enzymes
      Business shall not constitute a consolidation or merger of any Subsidiary
      or Affiliate of the Company that owns substantially all of the assets used
      in the conduct of the Enzymes Business to which this clause (v) shall
      apply.

      "Chief Executive Officer" means the chief executive officer of the
Company.

      "Compensation Committee" means the Compensation Committee of the Board.

      "Constructive Termination Without Cause" means a voluntary termination of
Executive's employment by the Executive within twelve (12) months following the
occurrence of a Change of Control and within 60 days following the occurrence of
any of the following events: (i) the Company's assignment to the Executive of
any duties inconsistent in any material respect with the Executive's position

                                       13
<PAGE>

(including status, offices and titles), authority, duties or responsibilities as
contemplated by Section 1.3 hereof which results in a diminution of the
Executive's position, excluding for this purpose and isolated, insubstantial or
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after the receipt of written notice thereof by the Executive; (ii) the
Executive's Annual Base Compensation and\or Potential Annual Target Bonus is\are
reduced below the amount of his then Annual Base Compensation and\or Potential
Annual Target Bonus fixed by the applicable provisions of Sections 3.1 and 3.2
hereof; (iii) the Executive is required by the Company to relocate his personal
residence outside of a 50 mile radius of the Company's current principal place
of business; or (iv) the failure of the Company or its legal
successor-in-interest to comply with any of the provisions of this Agreement,
other than an isolated, insubstantial or inadvertent action not taken in bad
faith and which is remedied by the Company promptly after the receipt of written
notice thereof by the Executive.

      "Non-Competition Period" means the Employment Period and the eighteen (18)
month period thereafter.

      "Person" means an individual, partnership, limited liability company,
trust, estate, association, corporation, governmental body or other juridical
being.

      "Resignation" means the voluntary termination of employment hereunder by
the Executive on or before the expiration of the Initial Term or any Extension
Term, as the case may be (except if made in contemplation of a Termination by
the Company for Cause), provided that if such action is taken by the Executive
without the giving of at least ninety (90) days prior written notice, such
termination of employment shall not be a "Resignation," but instead shall
constitute a Termination for Cause, further provided that the termination of the
Employment Period on account of the failure of the Executive to extend the
Employment Period in accordance with the provisions of Section 2.2 hereof shall
constitute a Resignation.

            "Severance Period" means: (i) the six (6) month period immediately
following the date of the termination of the Employment Period; provided that
(ii) if (A) the Executive has been an employee of the Company or any Subsidiary
or Affiliate for at least five consecutive years and (B) the Executive's
employment was terminated either (x) by the Company as a Termination by the
Company Without Cause or (y) by the Executive on account of the occurrence of a
Constructive Termination Without Cause at anytime within twelve (12) months
following the occurrence of a Change of Control, then the term "Severance
Period" means the eighteen (18) month period immediately following the
termination of the Employment Period.

            "Subsidiary" means, with respect to any Person of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of such Person or a combination thereof, or (ii) if a limited liability company,
partnership, association or other business entity, a majority of the partnership
or other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more Subsidiaries of such Person
or a combination thereof. For purposes hereof, a Person or Persons shall be
deemed to have a majority ownership interest in a limited liability company,
partnership, association or other business entity if such Person or Persons
shall be allocated a majority of limited liability company, partnership,
association or other business entity gains or losses or shall be or control any
managing director or general partner of such limited liability company,
partnership, association or other business entity.

                                       14
<PAGE>

      "Termination by the Company for Cause" means termination by the Company of
the Executive's employment on or before the expiration of the Initial Term or
any Extension Term, as the case may be, on account of a finding by the
Compensation Committee that the Executive has: (i) breached this Agreement or
any other agreement between the Executive and the Company, any Subsidiary or any
of their Affiliates; (ii) engaged in disloyalty to the Company, including
without limitation, the diversion of corporate opportunity, fraud, embezzlement,
theft, commission of a felony or proven dishonesty, in the course of his
performance of his services hereunder; (iii) disclosed trade secrets or other
Confidential Information of the Company to Persons not entitled to receive such
information; or (iv) engaged in such other behavior detrimental to the interests
of the Company as the Compensation Committee determines; provided that the
termination of the Executive's employment hereunder by the Company shall not be
deemed a Termination by the Company for Cause unless and until there shall have
been delivered to the Executive a written notice from the Chief Executive
Officer (after reasonable notice (in light of the circumstances surrounding the
termination) to and an opportunity for the Executive, alone and in person, to
have a face-to-face meeting with the Compensation Committee) stating that in the
good faith opinion of the Compensation Committee, the Executive was guilty of
the conduct set forth in one or more of the foregoing clauses.

      "Termination by the Company Without Cause" means a termination of the
Executive's employment by the Company on or before the expiration of the Initial
Term or any Extension Term, as the case may be, which is not a Termination by
the Company for Cause, provided that the termination of the Employment Period on
account of the failure of the Company to extend the Employment Period in
accordance with the provisions of Section 2.2 hereof shall constitute a
Termination by the Company Without Cause.

      "Total Disability" means the Executive's inability, because of illness,
injury or other physical or mental incapacity, to perform his duties hereunder
(as determined by the Compensation Committee in good faith) for a continuous
period of ninety (90) consecutive days, or for a total of ninety (90) days
within any three hundred sixty (360) consecutive day period, in which case such
Total Disability shall be deemed to have occurred on the last day of such ninety
(90) day or three hundred sixty (360) day period, as applicable.

                                  ARTICLE VIII
                                     GENERAL

      8.1 Notices. All notices under this Agreement shall be in writing and
shall be deemed properly sent, (i) when delivered, if by personal service or
reputable overnight courier service, or (ii) when received, if sent (x) by
certified or registered mail, postage prepaid, return receipt requested, or (y)
via facsimile transmission (provided that a hard copy of such notice is sent to
the addressee via one of the methods of delivery or mailing set forth above on
the same day the facsimile transmission is sent); to (A) the Executive at the
address of his principal place of residence on file with the Company from time
to time and (B) to the Company, as follows:

            Dyadic International, Inc.
            c/o Chief Executive Officer
            140 Intracoastal Pointe Drive, Suite 404
            Jupiter, Florida  33477
            Facsimile (561) 743-8513

                                       15
<PAGE>

            With a copy to:

            Robert I. Schwimmer, Esq.
            Jenkens & Gilchrist
            225 West Washington, Suite 2600
            Chicago, Illinois 60606
            Facsimile (312) 425-3909

      8.2 Governing Law. This Agreement shall be subject to and governed by the
laws of the State of Florida without regard to any choice of law or conflicts of
law rules or provisions (whether of the State of Florida or any other
jurisdiction), irrespective of the fact that the Executive may become a resident
of a different state.

      8.3 Binding Effect. The Agreement shall be binding upon and inure to the
benefit of the Company, its successors and assigns, and the Executive and his
executors, administrators, personal representatives and heirs.

      8.4 Complete Understanding. This Agreement constitutes the complete
understanding among the parties hereto with regard to the subject matter hereof,
and supersedes any and all prior agreements and understandings relating to the
terms of Executive's employment by the Company, provided that that certain
Confidential Information, Inventions Assignment and Non-Compete Agreement
between the Company's Subsidiary and the Executive dated May 21, 2001 and
assigned by that Subsidiary to the Company on October 29, 2004 (the "Prior
Proprietary Rights Agreement"), shall, to the extent not inconsistent with the
terms and provisions of this Agreement, remain in full force and effect as to
any rights and obligations of the parties thereunder in existence prior to the
date of this Agreement, further provided that in the event of any inconsistency
between the provisions of this Agreement and the provisions of the Prior
Proprietary Rights Agreement, or in the event of any inconsistency between the
rights and obligations of the parties under this Agreement and the rights and
obligations of the parties under the Prior Proprietary Rights Agreement, in
either instance, the provisions of this Agreement shall control.

      8.5 Amendments. No change, modification or amendment of any provision of
this Agreement shall be valid unless made in writing and signed by all of the
parties hereto.

      8.6 Waiver. The waiver by the Company of a breach of any provision of this
Agreement by the Executive shall not operate or be construed as a waiver of any
subsequent breach by the Executive. The waiver by the Executive of a breach of
any provision of this Agreement by the Company shall not operate as a waiver of
any subsequent breach by the Company.

      8.7 Venue, Jurisdiction, Etc. The Executive hereby agrees that any suit,
action or proceeding relating in any way to this Agreement may be brought and
enforced in the Circuit Court of Palm Beach County of the State of Florida or in
the District Court of the United States of America for the Southern District of
Florida, and in either case the Executive hereby submits to the jurisdiction of
each such court. The Executive hereby waives and agrees not to assert, by way of
motion or otherwise, in any such suit, action or proceeding, any claim that the

                                       16
<PAGE>

Executive is not personally subject to the jurisdiction of the above-named
courts, that the suit, action or proceeding is brought in an inconvenient forum
or that the venue of the suit, action or proceeding is improper. The Executive
consents and agrees to service of process or other legal summons for purpose of
any such suit, action or proceeding by registered mail addressed to the
Executive at his or her address listed in the business records of the Company.
Nothing contained herein shall affect the rights of the Company to bring suit,
action or proceeding in any other appropriate jurisdiction. The Executive and
the Company do each hereby waive any right to trial by jury, he or it may have
concerning any matter relating to this Agreement.

      8.8 Severability. If any portion of this Agreement shall be for any
reason, invalid or unenforceable, the remaining portion or portions shall
nevertheless be valid, enforceable and carried into effect.

      8.9 Headings. The headings of this Agreement are inserted for convenience
only and are not to be considered in the construction of the provisions hereof.

      8.10 Counterparts. This Agreement may be executed in one or more
counterparts, all of which, taken together, shall constitute one and the same
agreement.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above-written.

COMPANY:                                        EXECUTIVE:

DYADIC INTERNATIONAL, INC., a
Delaware Corporation
                                                ------------------------------
                                                 Kent M. Sproat
 By:____________________________
         Chief Executive Officer


                                       17
<PAGE>

                                    EXHIBIT A
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                                 KENT M. SPROAT


                             STOCK OPTION AGREEMENT

<PAGE>

                           DYADIC INTERNATIONAL, INC.
                          2001 EQUITY COMPENSATION PLAN
                          STOCK OPTION GRANT AGREEMENT

      This STOCK OPTION GRANT AGREEMENT (this "Agreement"), dated as of March
30, 2005 (the "Date of Grant"), is delivered by Dyadic International, Inc. (the
"Company") to Kent M. Sproat (the "Grantee").

                                    RECITALS

      A. Concurrently with the execution and delivery of this Agreement, the
Grantee has entered into an employment agreement with the Company dated of even
date herewith (as may be amended, restated or otherwise modified, the
"Employment Agreement"), pursuant to which the Grantee will serve as the
Company's Executive Vice President, Enzymes Business, and (ii) the Executive
Vice President of the Company's principal operating Subsidiary, Dyadic
International (USA), Inc.

      B. The Dyadic International, Inc. 2001 Equity Compensation Plan (as may be
amended, restated or otherwise modified, the "Plan") provides for the grant of
options to purchase shares of common stock of the Company. A copy of the Plan
has heretofore been furnished to the Grantee, receipt of which is hereby
expressly acknowledged. Capitalized terms used but not otherwise defined herein
shall have the meanings given such terms in the Plan.

      C. As contemplated in Section 1(a) of the Plan, the Board of Directors of
the Company has appointed a committee (the "Committee") to administer the Plan.

      D. To induce the Grantee to enter into the Employment Agreement and
continue to perform the obligations specified therein and promote the best
interests of the Company, the Committee has decided to Grant an Option to the
Grantee under the Plan to purchase shares of Company Stock ("Shares").

                                   AGREEMENT:

      NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:

1. Grant of Option. Subject to the terms and conditions set forth in this
Agreement and in the Plan, the Company hereby grants to the Grantee an Option to
purchase 70,000 Shares at an exercise price of $ 3.025 per Share (which is the
Fair Market Value on the date of Grant, being equal to the mean of the final
"asked" and "bid" prices of the Shares on the date hereof, as fixed by the terms
of the Plan). The Option shall become exercisable in accordance with the terms
of Paragraph 2 below. In accordance with Section 5(g) of the Plan, the Option
shall be treated as an Incentive Stock Option except to the extent that the
aggregate Fair Market Value of the Shares as of the date of the grant with
respect to which Incentive Stock Option is for the first time exercisable by the
Grantee during any calendar year under the Plan exceeds $100,000, then the
Option, as to such excess, shall be treated as a Nonqualified Stock Option.

                                       2
<PAGE>

2. Exercisability of Option. The number of Shares in respect of which the
Grantee shall be permitted to exercise the Option shall be determined by
reference to the dates (each a "Vesting Date") fixed in the table set forth
below, provided that: (a) exercisability of Shares is cumulative; and (b) there
must not have occurred a termination of the Grantee's employment with the
Company (the "Employment Relationship") for any reason whatsoever (the date of
such termination being hereinafter referred to as the "Termination Date") prior
to a Vesting Date in order for the Option to be exercisable in respect of the
Shares indicated opposite that Vesting Date:

            Vesting Date                  Additional   Shares  for  Which  the
                                                 Option is Exercisable
      1st Anniversary of Date of Grant                1/4th of Option Shares
      2nd Anniversary of Date of Grant                1/4th of Option Shares
      3rd Anniversary of Date of Grant                1/4th of Option Shares
      4th Anniversary of Date of Grant                1/4th of Option Shares

3. Term of Option.

      (a) The Option shall be exercisable for a term commencing with the Date of
Grant and ending on the earlier of (i) the fifth (5th) anniversary of the Date
of Grant or (ii) the termination of the Plan, unless the Option is terminated at
an earlier date in accordance with the provisions of this Agreement or the Plan.

      (b) Any portion of the Option that is not exercisable on the Termination
Date shall terminate on that date.

      (c) The Option, to the extent exercisable, shall automatically terminate
upon the earlier of (x) the expiration of the period fixed in Paragraph 3(a),
above, or (y) the first to occur of any of the following events:

            (i) Subject to clause (v) below, the expiration of the 90 day period
      following the Termination Date, if the termination is for any reason other
      than the Disability of the Grantee, his death or for Cause.

            (ii) Subject to clause (v) below, the expiration of the one (1) year
      period after the Termination Date, to the extent the Option is then
      unvested, if the termination of the Employment Relationship was on account
      of the Grantee's Disability.

                                       3
<PAGE>

            (iii) The expiration of the one (1) year period after the
      Termination Date, if the reason for the termination of the Employment
      Relationship was on account of the Grantee's death.

            (iv) The Termination Date, if the termination of the Employment
      Relationship was for Cause.

            (v) The provisions of clauses (i) and (ii) above to the contrary
      notwithstanding, if the Grantee engages in conduct that constitutes Cause
      after the Termination Date, the Option shall immediately terminate to the
      extent then unexercised (regardless of vesting).

      (d) In accordance with Section 5(e)(ii) of the Plan, if the provisions of
either clause (iv) or clause (v) of Paragraph 3(c) applied to the termination of
the Option, the Grantee shall automatically forfeit all Shares underlying any
exercised portion of the Option for which the Company has not yet delivered the
share certificates, upon refund by the Company of the exercise price paid by the
Grantee for such Shares.

4. Exercise Procedures.

      (a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee may
exercise part or all of the exercisable portion of the Option by giving the
Committee written notice of intent to exercise in the manner provided in this
Agreement, specifying the number of Shares as to which the Option is to be
exercised. On the delivery date, the Grantee shall pay the exercise price (i) in
cash, (ii) with the approval of the Committee, by delivering Shares of the
Company which shall be valued at their fair market value on the date of delivery
(such valuation to be determined in the manner fixed in the Plan), (iii) payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board or (iv) by such other method as the Committee may approve,
provided that the Committee may, in its absolute discretion, impose from time to
time such limitations as it deems appropriate on the use of Shares of the
Company to exercise the Option.

      (b) The obligation of the Company to deliver Shares upon exercise of the
Option shall be subject to all applicable laws, rules, and regulations and such
approvals by governmental agencies as may be deemed appropriate by the
Committee, including such actions as Company counsel shall deem necessary or
appropriate to comply with relevant securities laws and regulations. The Company
may require that the Grantee (or other person exercising the Option after the
Grantee's death) represent that the Grantee is purchasing Shares for the
Grantee's own account and not with a view to or for sale in connection with any
distribution of the Shares, or such other representation as the Committee deems
appropriate. All obligations of the Company under this Agreement shall be
subject to the rights of the Company as set forth in the Plan to withhold
amounts required to be withheld for any taxes, if applicable. Subject to
Committee approval, in its absolute discretion, the Grantee may elect to satisfy
any income tax withholding obligation of the Company with respect to the Option
by having Shares withheld up to an amount that does not exceed the minimum
applicable withholding tax rate for federal (including FICA), state and local
tax liabilities.

                                       4
<PAGE>

5. Restrictions on Transfer of Shares. In addition to the restrictions imposed
by the Plan on the transferability of the Shares acquired by an the Grantee's
exercise of the Option granted hereby, without the prior consent of the Company,
for so long as the Company is not a "Reporting Company" within the meaning of
the Exchange Act of 1934, as amended, the Grantee shall make no transfer of the
Shares (a) for a period of five (5) years following the date of this Agreement
and (b) thereafter, to any competitor of the Company.

6. Change of Control. The provisions of the Plan applicable to a Change of
Control shall apply to the Option, and, in the event of a Change of Control, the
Committee may take such actions as it deems appropriate pursuant to the Plan.

7. Restrictions on Exercise. Only the Grantee may exercise the Option during the
Grantee's lifetime and, after the Grantee's death, the Option shall be
exercisable (subject to the limitations specified in the Plan) solely by the
legal representatives of the Grantee, or by the person who acquires the right to
exercise the Option by will or by the laws of descent and distribution, to the
extent that the Option is exercisable pursuant to this Agreement.

8. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
the terms of which are incorporated herein by reference, and in all respects
shall be interpreted in accordance with the Plan. The grant and exercise of the
Option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) rights and obligations with respect
to withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) changes in capitalization of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the Option pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.

9. No Employment or Other Rights. The grant of the Option shall not confer upon
the Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any time for
any reason is specifically reserved.

10. No Shareholder Rights. Neither the Grantee, nor any person entitled to
exercise the Grantee's rights in the event of the Grantee's death, shall have
any of the rights and privileges of a shareholder with respect to the Shares
subject to the Option, until certificates for Shares have been issued upon the
exercise of the Option.

                                       5
<PAGE>

11. Assignment and Transfers. The rights and interests of the Grantee under this
Agreement may not be sold, assigned, encumbered or otherwise transferred except,
in the event of the death of the Grantee, by will or by the laws of descent and
distribution. In the event of any attempt by the Grantee to alienate, assign,
pledge, hypothecate, or otherwise dispose of the Option or any right hereunder,
except as provided for in this Agreement, or in the event of the levy or any
attachment, execution or similar process upon the rights or interests hereby
conferred, the Company may terminate the Option by notice to the Grantee, and
the Option and all rights hereunder shall thereupon become null and void. The
rights and protections of the Company hereunder shall extend to any successors
or assigns of the Company and to the Company's parents, subsidiaries, and
affiliates. This Agreement may be assigned by the Company without the Grantee's
consent.

12. Applicable Law. The validity, construction, interpretation and effect of
this instrument shall be governed by and construed in accordance with the laws
of the State of Florida, without giving effect to the conflicts of laws
provisions thereof.

13. Notice. Any notice to the Company provided for in this instrument shall be
addressed to the Company in care of the Chief Executive Officer at the Company's
principal executive offices, and any notice to the Grantee shall be addressed to
such Grantee at the current address shown on the payroll of the Company, or to
such other address as the Grantee may designate to the Company in writing. Any
notice shall be delivered by hand, sent by telecopy or enclosed in a properly
sealed envelope addressed as stated above, registered and deposited, postage
prepaid, in a post office regularly maintained by the United States Postal
Service.

14. Counterparts. This Agreement may be signed in any number of counterparts and
by facsimile signature, each of which shall be deemed to be an original, and all
of which taken together shall be deemed to be one and the same instrument.

15. Complete Understanding. This Agreement, together with the Plan, contains the
entire agreement of the parties relating to the subject matter hereof and
supersedes all prior agreements and understanding with respect to such subject
matter, and the parties hereto have made no agreements, representations or
warranties relating to the subject matter of this Agreement which are not set
forth herein, provided that the Parties are parties to the Employment Agreement.
Nothing contained in this Agreement shall be construed to limit or affect in any
manner or to any extent the restrictions or prohibitions that are applicable to
the Grantee under the Employment Agreement or the duration thereof. Similarly,
except as expressly provided otherwise in this Agreement, nothing contained in
the Employment Agreement shall be construed to limit or affect in any manner or
to any extent the restrictions or prohibitions that are applicable to the
Grantee under this Agreement.

                            [Signature Page Follows]


                                       6
<PAGE>

      IN WITNESS WHEREOF, the Company has caused a duly authorized officer to
execute this Agreement, and the Grantee has executed this Agreement, effective
as of the Date of Grant.

THE COMPANY:                              GRANTEE:

DYADIC INTERNATIONAL, INC.

By:   _____________                       Accepted:   ______________
      President                                       Kent M. Sproat


                                       7
<PAGE>

                                    EXHIBIT B
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                                 KENT M. SPROAT

                             TERMINATION CERTIFICATE

      This is to certify that, except as permitted by the Employment Agreement
(as defined below) I do not have in my possession, nor have I failed to return,
any software, inventions, designs, works of authorship, copyrightable works,
formulas, data, marketing plans, forecasts, product concepts, marketing plans,
strategies, forecasts, devices, records, data, notes, reports, proposals,
customer lists, correspondence, specifications, drawings, blueprints, sketches,
materials, patent applications, continuation applications, continuation-in-part
applications, divisional applications, other documents or property, or
reproductions of any aforementioned items belonging to DYADIC INTERNATIONAL,
INC. (the "Company"), its Subsidiaries and their Affiliates, successors or
assigns.

      I further certify that I have complied with all the terms of the
Employment Agreement dated as of March 30, 2005 between the Company and me (as
the same may be amended, restated or otherwise modified, the "Employment
Agreement"), relating to the reporting of any Work Product conceived or made by
me (solely or jointly with others) covered by the Employment Agreement.
Capitalized terms used but not otherwise defined herein shall have the meanings
given such terms in the Employment Agreement.

      I acknowledge that the provisions of the Employment Agreement relating to
Confidential Information continue in effect beyond the termination of the
Employment Agreement, as set forth therein.

      Finally, I further acknowledge that the provisions of the Employment
Agreement relating to my (i) anti-pirating, (ii) non-interference and (iii)
non-competition covenants to the Company, its Subsidiaries and their Affiliates,
also remain in effect following the date of my termination of employment with
the Company.

Date:____________                   ______________________________
                                         Executive


                                       8
<PAGE>

                                    EXHIBIT C
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                                 KENT M. SPROAT

                                 GENERAL RELEASE

      I, Kent M. Sproat, in consideration of and subject to the performance by
DYADIC INTERNATIONAL, INC., a Delaware corporation (the "Company"), of its
material obligations under the Employment Agreement, dated as of March 30, 2005
(as the same may be amended, restated or otherwise modified, the "Agreement"),
do hereby release and forever discharge as of the date hereof the Company, its
Subsidiaries and their Affiliates (as those terms are defined in the Agreement)
and all present and former directors, officers, agents, representatives,
employees, successors and assigns of the Company, its Subsidiaries and their
Affiliates and their direct or indirect owners (collectively, the "Released
Parties") to the extent provided below.

1.    I understand  that any payments or benefits  paid or granted to me under
      Section 5.2(c) of the Agreement  represent,  in part,  consideration for
      signing  this General  Release and are not salary,  wages or benefits to
      which I was already  entitled.  I  understand  and agree that I will not
      receive the  payments and  benefits  specified in Section  5.2(c) of the
      Agreement  unless I execute this General  Release and do not revoke this
      General  Release  within the time period  permitted  hereafter or breach
      this General Release.

2.    Except as provided in paragraph 4 of this General  Release,  I knowingly
      and voluntarily  release and forever discharge the Company and the other
      Released  Parties  from  any and  all  claims,  controversies,  actions,
      causes  of  action,   cross-claims,   counterclaims,   demands,   debts,
      compensatory   damages,   liquidated  damages,   punitive  or  exemplary
      damages,  other  damages,  claims  for costs  and  attorneys'  fees,  or
      liabilities  of any nature  whatsoever  in law and in equity,  both past
      and  present  (through  the date of this  General  Release)  and whether
      known or unknown,  suspected,  or claimed  against the Company or any of
      the Released Parties which I, my spouse, or any of my heirs,  executors,
      administrators  or  assigns,  may  have,  which  arise  out  of  or  are
      connected  with my employment  with, or my separation  from, the Company
      (including,  but not limited  to, any  allegation,  claim or  violation,
      arising  under:  Title VII of the Civil Rights Act of 1964,  as amended;
      the Civil Rights Act of 1991; the Age  Discrimination  in Employment Act
      of 1967,  as amended  (including  the Older Workers  Benefit  Protection
      Act);  the  Equal  Pay Act of  1963,  as  amended;  the  Americans  with
      Disabilities  Act of 1990; the Family and Medical Leave Act of 1993; the
      Civil Rights Act of 1866, as amended;  the Worker Adjustment  Retraining
      and Notification  Act; the Executive  Retirement  Income Security Act of
      1974; any applicable Executive Order Programs;  the Fair Labor Standards
      Act; or their state or local  counterparts;  or under any other federal,
      state or local  civil or human  rights  law,  or under any other  local,
      state,  or federal law,  regulation  or  ordinance;  or under any public
      policy,  contract or tort,  or under  common  law; or arising  under any
      policies,  practices  or  procedures  of the  Company;  or any claim for
      wrongful  discharge,  breach  of  contract,   negligent  or  intentional
      infliction of emotional  distress,  defamation;  or any claim for costs,
      fees, or other  expenses,  including  attorneys'  fees incurred in these
      matters)  (all of the foregoing  collectively  referred to herein as the
      "Claims").
<PAGE>

3.    I represent that I have made no assignment or transfer of any right,
      claim, demand, cause of action, or other matter covered by paragraph 2 of
      this General Release.

4.    I and the Company  mutually  agree that this  General  Release  does not
      waive or release  any rights or claims  that I may have  under:  (a) the
      Age  Discrimination in Employment Act of 1967 which arise after the date
      I execute this General  Release;  and (b) any  agreements to which I and
      the Company  and/or any of its  Subsidiaries  or Affiliates  are parties
      pertaining to any shares or options to purchase  shares of capital stock
      of the Company  and/or any of its  Subsidiaries  or Affiliates  owned by
      me. I acknowledge  and agree that my separation from employment with the
      Company in compliance  with the terms of the  Agreement  shall not serve
      as the basis for any claim or  action  (including,  without  limitation,
      any claim under the Age Discrimination in Employment Act of 1967).

5.    In signing this General Release,  I acknowledge and intend that it shall
      be  effective  as a bar to each and every one of the Claims  hereinabove
      mentioned or implied.  I expressly  consent  that this  General  Release
      shall be given full force and  effect  according  to each and all of its
      express terms and  provisions,  including  those relating to unknown and
      unsuspected  Claims  (notwithstanding  any state statute that  expressly
      limits the  effectiveness  of a general release of unknown,  unsuspected
      and  unanticipated  Claims),  if any,  as well as those  relating to any
      other Claims  hereinabove  mentioned or implied. I acknowledge and agree
      that this  waiver is an  essential  and  material  term of this  General
      Release and that without  such waiver the Company  would not have agreed
      to the  terms of the  Agreement.  I  further  agree  that in the event I
      should bring a Claim seeking  damages  against any Released Party, or in
      the event I should  seek to recover  against any  Released  Party in any
      Claim  brought  by a  governmental  agency on my  behalf,  this  General
      Release  shall  serve as a complete  defense to such  Claims.  I further
      agree  that I am not aware of any  pending  charge or  complaint  of the
      type  described  in  paragraph  2 as of the  execution  of this  General
      Release.

6.    I agree that neither this General Release, nor the furnishing of the
      consideration for this General Release, shall be deemed or construed at
      any time to be an admission by the Company, any Released Party or myself
      of any improper or unlawful conduct.

7.    I agree that if I challenge  the  validity of this  General  Release,  I
      will  forfeit  all  unpaid  amounts  otherwise  payable  by the  Company
      pursuant to Section  5.2(c) of the  Agreement  other than the very first
      payment due me  thereunder,  provided that nothing  herein  contained in
      this Agreement shall prohibit or bar me from filing a charge,  including
      a challenge to the  validity of the  Agreement,  with the United  States



                                       2
<PAGE>

      Equal Employment  Opportunity Commission ("EEOC"), or any state or local
      fair  employment   practices  agency,  or  from   participating  in  any
      investigation,  hearing  or  proceeding  conducted  by the EEOC,  or any
      state or local fair employment  practices agency. I also agree that if I
      violate this General  Release by suing the Company or the other Released
      Parties,  I will pay all costs and  expenses  of  defending  against the
      suit incurred by the Released Parties,  including reasonable  attorneys'
      fees, and return all payments received by me pursuant to the Agreement.

8.    I agree that this General Release is confidential and agree not to
      disclose any information regarding the terms of this General Release,
      except to my immediate family and any tax, legal or other counsel I have
      consulted regarding the meaning or effect hereof or as required by law,
      and I will instruct each of the foregoing not to disclose the same to
      anyone.

9.    Any non-disclosure provision in this General Release does not prohibit or
      restrict me (or my attorney) from responding to any inquiry about this
      General Release or its underlying facts and circumstances by the
      Securities and Exchange Commission (SEC), the EEOC (or a state or local
      fair employment practices agency), the National Association of Securities
      Dealers, Inc. (NASD), any other self-regulatory organization or
      governmental entity.

10.   I agree  to  reasonably  cooperate  with  the  Company  in any  internal
      investigation or administrative,  regulatory,  or judicial proceeding. I
      understand  and  agree  that  my  cooperation  may  include,  but not be
      limited to,  making  myself  available  to the Company  upon  reasonable
      notice for  interviews  and  factual  investigations;  appearing  at the
      Company's  request  to give  testimony  without  requiring  service of a
      subpoena or other legal process;  volunteering to the Company  pertinent
      information;  and turning  over to the Company  all  relevant  documents
      which are or may come into my  possession  all at times and on schedules
      that are reasonably  consistent with my other  permitted  activities and
      commitments,  provided  that I shall have no  obligation  to expend more
      than one week of my time in  connection  with the  performance  of these
      activities which out reasonable  recompense,  as mutually and reasonably
      agreed upon by me and the Company.  I  understand  that in the event the
      Company asks for my cooperation in accordance with this  provision,  the
      Company  will  reimburse  me  solely  for  reasonable  travel  expenses,
      including lodging and meals, upon my submission of receipts.

11.   Notwithstanding anything in this General Release to the contrary, this
      General Release shall not relinquish, diminish, or in any way affect any
      rights or claims arising out of any breach by the Company or by any
      Released Party of the Agreement.

12.   Whenever  possible,  each  provision  of this General  Release  shall be
      interpreted  in,  such  manner  as  to  be  effective  and  valid  under
      applicable  law, but if any provision of this General Release is held to
      be  invalid,   illegal  or   unenforceable  in  any  respect  under  any
      applicable law or rule in any jurisdiction, such invalidity,  illegality
      or  unenforceability  shall not affect any other  provision or any other
      jurisdiction,  but this General Release shall be reformed, construed and
      enforced  in  such   jurisdiction   as  if  such  invalid,   illegal  or
      unenforceable provision had never been contained herein.

                                       3
<PAGE>

BY SIGNING THIS GENERAL RELEASE, I REPRESENT AND AGREE THAT:

(a)   I HAVE READ IT CAREFULLY;

(b)   I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT
      RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION
      IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT
      OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH
      DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
      OF 1974, AS AMENDED;

(c)   I VOLUNTARILY CONSENT TO EVERYTHING IN IT;

(d)   I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I
      HAVE DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION I HAVE CHOSEN NOT
      TO DO SO OF MY OWN VOLITION;

(e)   I HAVE HAD AT LEAST 21 DAYS FROM THE DATE OF MY RECEIPT OF THIS RELEASE
      SUBSTANTIALLY IN ITS FINAL FORM ON _______________ ____, ____ TO CONSIDER
      IT AND THE CHANGES MADE SINCE THE ______________ _____, _____VERSION OF
      THIS RELEASE ARE NOT MATERIAL AND WILL NOT RESTART THE REQUIRED 21-DAY
      PERIOD;

(f)   THE CHANGES TO THE AGREEMENT SINCE ____________ ___, _____ EITHER ARE NOT
      MATERIAL OR WERE MADE AT MY REQUEST.

(g)   I UNDERSTAND THAT I HAVE SEVEN DAYS AFTER THE EXECUTION OF THIS RELEASE TO
      REVOKE IT AND THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE
      UNTIL THE REVOCATION PERIOD HAS EXPIRED;

(h)   I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE
      ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND


                                       4
<PAGE>

(i)   I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED,
      WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY
      AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME.

DATE:                                     _____________________


                                       5
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>4
<FILENAME>ex99-3.txt
<TEXT>
                         EXECUTIVE EMPLOYMENT AGREEMENT

      THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made and entered into
as of the 30th day of March, 2005, by and between DYADIC INTERNATIONAL, INC., a
Delaware corporation (the "Company"), and Ratnesh (Ray) Chandra (the
"Executive"). The Company and the Executive are sometimes hereinafter
collectively referred to as the "parties" and individually as a "party,"
provided that as applicable, any reference to the Company shall mean the
Company, its Subsidiaries and and\or their Affiliates, as the case may be.
Certain capitalized terms used in this Agreement are defined in Article VII
hereof.

                                    RECITALS

      A. The Executive is currently employed by the Company as the Company's
Vice President, Marketing - BioSciences. The Compensation Committee of the Board
of Directors ("Board") of the Company (the "Compensation Committee") recently
reviewed the Executive's job performance in calendar year 2004, and made a
number of favorable determinations regarding Executive's job performance.

      B. The Company maintains the "Dyadic International, Inc. 2001 Equity
Compensation Plan" (as the same may be amended, restated or otherwise modified,
the "Equity Compensation Plan") pursuant to which the Company is authorized to
grant stock options to purchase shares of Common Stock of the Company ("Shares")
to employees, officers, directors, consultants and advisors of the Company and
its Subsidiaries.

      C. Among the determinations of the Compensation Committee were that,
subject to the satisfaction of the condition set forth in Recital D hereof, it
would be in the best interests of the Company to: (i) promote the Executive to
the position of Senior Vice President, Marketing - Biotechnology Systems,
increase the Executive's annual base compensation and confer upon the Executive
the benefits of certain post-employment severance benefits provided for in this
Agreement; and (ii) incentivize and reward the Executive's efforts, loyalty and
commitment to the Company, by granting to the Executive a certain stock option
to purchase Shares (the "Option") under and pursuant to the terms of the Equity
Compensation Plan and a Stock Option Agreement in the form of Exhibit A attached
hereto and by this reference made a part hereof (the "Stock Option Agreement").

      D. As a condition of that promotion, and as partial consideration for that
salary increase and the grant of the Option, the Company requires that this
Agreement be entered into pursuant to which the Executive is hereby knowingly
and intentionally furnishing the Company with, among other things, the suite of
proprietary covenants of the Executive in favor of the Company set forth in
Article IV hereof, including by way of illustration, and not in limitation, the
Executive's covenant not to compete with the businesses of the Company, its
Subsidiaries and their Affiliates.

      E. The Executive desires to be promoted to the position of Senior Vice
President, Marketing - Biotechnology Systems, to receive the salary increase and
other financial benefits of this Agreement and the grant of the Option. Further,
the Executive expressly acknowledges that: (i) as a member of the Company's
<PAGE>

management, he is one of the persons charged with primary responsibility for the
implementation of the Company's business plans, and that he will have regular
access to various confidential and/or proprietary information relating to the
Company, its Subsidiaries, their Affiliates and their businesses; and (ii) the
suite of proprietary covenants of the Executive in favor of the Company set
forth in Article IV hereof which the Executive is knowingly and intentionally
furnishing to the Company, including by way of illustration, and not in
limitation, the Executive's covenant not to engage in competition with the
Company, its Subsidiaries, their Affiliates and their businesses, are (A) being
made both in consideration of the Company's promotion, increase in the annual
base salary of and the grant of the Option to the Executive and (B) necessary to
protect the legitimate business interests of the Company, its Subsidiaries and
Affiliates and their respective businesses.

                                    AGREEMENT

      NOW, THEREFORE, in consideration of the foregoing recitals, and the mutual
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby mutually acknowledged, the parties
hereby agree as follows:

                                    ARTICLE I
                             EMPLOYMENT RELATIONSHIP

      1.1   Recitals.  The Recitals to this Agreement are hereby  incorporated
herein and made a part hereof.

      1.2 Employment. Subject to the terms and conditions of this Agreement, the
Company hereby agrees to employ the Executive to serve as the Company's Senior
Vice President, Marketing - Biotechnology Systems with responsibility for
developing business opportunities for the bioscience markets served by the
Company or any Subsidiary or Affiliate of the Company (the "BioSciences
Business"), and the Executive hereby accepts such employment, and agrees to
perform all of his assigned duties and responsibilities to the best of his
abilities in a diligent, trustworthy, businesslike and efficient manner, and in
compliance with the Dyadic International, Inc. Code of Business Conduct and
Ethics, a copy of which appears on the Company's website.

      1.3 Duties; Reporting Authority. The Executive shall have the normal and
customary duties, responsibilities and authority of a Person holding the title
and job description set forth in Section 1.2 hereof, and, in addition, shall
perform such other duties on behalf of the Company, its Subsidiaries and their
Affiliates as may be assigned to him by the Chief Executive Officer, the Chief
Operating Officer or President of the Company, or by the Board. In connection
with the Executive's performance of his duties he shall report to the Chief
Executive Officer, the Chief Operating Officer or President of the Company or to
such other Person as the Chief Executive Officer, Chief Operating Officer or
President of the Company or the Board may designate from time to time.

      1.4 Exclusive Employment. While he is employed by the Company hereunder,
the Executive covenants to the Company that he will devote his entire business
time, energy, attention and skill to the Company, its Subsidiaries and their
Affiliates (except for permitted vacation periods and reasonable periods of
illness or other incapacity), and use his good faith best efforts to promote the
interests of the Company, its Subsidiaries and their Affiliates. The foregoing
shall not be construed as prohibiting the Executive from spending such time as
may be reasonably necessary to attend to his personal affairs and investments so
long as such activities do not conflict or interfere with the Executive's
obligations and\or timely performance of his duties to the Company, its
Subsidiaries and their Affiliates hereunder.


                                       2
<PAGE>

      1.5   Executive Representations.     The  Executive  hereby   represents
and warrants to the Company that:

            (a) the execution, delivery and performance by the Executive of this
      Agreement and any other agreements contemplated hereby to which the
      Executive is a party do not and shall not conflict with, breach, violate
      or cause a default under any contract, agreement, instrument, order,
      judgment or decree to which the Executive is a party or by which he is
      bound;

            (b) the Executive is not a party to or bound by any employment
      agreement, non-competition agreement or confidentiality agreement with any
      other Person (or if a party to such an agreement, the Executive has
      disclosed the material terms thereof to the Compensation Committee prior
      to the execution hereof and promptly after the date hereof shall deliver a
      copy of such agreement to the Compensation Committee); and

            (c) upon the execution and delivery of this Agreement by the
      Company, this Agreement shall be the valid and binding obligation of the
      Executive, enforceable in accordance with its terms.

The Executive hereby acknowledges and represents that he has consulted with
independent legal counsel regarding his rights and obligations under this
Agreement and that he fully understands the terms and conditions contained
herein.

      1.6   Company   Representations.   The  Company  hereby  represents  and
warrants to the Executive that:

            (a) the execution, delivery and performance by the Company of this
      Agreement and any other agreements contemplated hereby to which the
      Company is a party do not and shall not conflict with, breach, violate or
      cause a default under any contract, agreement, instrument, order, judgment
      or decree to which the Company is a party or by which he is bound; and

            (b) upon the execution and delivery of this Agreement by the
      Executive, this Agreement shall be the valid and binding obligation of the
      Company, enforceable in accordance with its terms.

      1.7   Indemnification.

            (a) By the Executive. The Executive shall indemnify and hold the
      Company and its Subsidiaries and Affiliates harmless from and against any
      and all claims, demands, losses, judgments, costs, expenses, or
      liabilities incurred by the Company and/or any of its Subsidiaries or
      Affiliates arising out of or in connection with the breach of any
      representation or warranty of the Executive contained in this Agreement.


                                       3
<PAGE>

            (b) By the Company. The Company shall indemnify and hold the
      Executive harmless from and against any and all claims, demands, losses,
      judgments, costs, expenses, or liabilities incurred by the Executive
      arising out of or in connection with the breach of any representation or
      warranty of the Company contained in this Agreement. Further, the Company
      shall defend, indemnify and hold harmless the Executive (including without
      limitation, the prompt advance payment of all reasonable legal fees and
      expenses) to the fullest extent permitted by applicable law and the
      by-laws of the Company.

                                   ARTICLE II
                              PERIOD OF EMPLOYMENT

      2.1 Employment Period. The Executive is an existing employee of the
Company and shall continue to be an employee of the Company until the date fixed
by the provisions of Section 2.2 hereof, subject to the early termination
provisions of Article V hereof (the "Employment Period"), it being acknowledged
that the Company's fiscal year ends on December 31, and that the Employment
Period shall therefore be denominated in calendar years.

      2.2 Initial Term of Employment Period and Extension Terms. The Employment
Period shall initially continue until December 31, 2007 (the "Initial Term").
The Employment Period shall be automatically extended for successive calendar
years of the Company following the expiration of the Initial Term (each such one
year period being hereinafter referred to as an "Extension Term") upon the same
terms and conditions provided for herein unless either party provides the other
party with advance written notice of its or his intention not to extend the
Employment Period; provided, however, that such notice must be delivered by the
non-extending party to the other party not later than ninety (90) days prior to
the expiration of the Initial Term or any Extension Term, as the case may be.

                                   ARTICLE III
                                  COMPENSATION

      3.1 Annual Base Compensation. Effective as of April 1, 2005, and during
the balance of the Employment Period the Company shall pay to the Executive an
annual base salary (the "Annual Base Compensation") in the amount of $170,250,
provided that the Annual Base Compensation the Employee had been being paid
prior to the date of this Agreement shall remain in effect until April 1, 2005.
The Annual Base Compensation shall be paid in regular installments in accordance
with the Company's general payroll practices, and shall be subject to all
required federal, state and local withholding taxes. The Executive's Annual Base
Compensation shall be reviewed by the Chief Executive Officer and the
Compensation Committee of the Board (the "Compensation Committee") annually, and
may, in the discretion of the Chief Executive Officer and the Compensation
Committee be increased, provided that there shall be no obligation on the part
of the Company to increase the Executive's Annual Base Compensation.

                                       4
<PAGE>

      3.2 Potential Annual Target Bonuses. In respect of each calendar year
falling within the Employment Period, the Executive shall be eligible to earn an
annual bonus, depending upon the results of operation of the Company, its
Subsidiaries and their Affiliates and the personal performance of the Executive,
of up to forty percent (40%) of the Executive's Annual Base Compensation for
that calendar year (the "Potential Annual Target Bonus") in accordance with the
terms of a bonus plan which shall be adopted and maintained in effect by the
Compensation Committee for that calendar year. The amount of the Potential
Annual Target Bonus, if any, which is earned by the Executive (the "Bonusable
Amount") shall be paid by the Company to the Executive following the close of
the Company's calendar year consistent with the timing of similar bonus payments
being made to other executives of the Company for such year, provided that,
unless expressly provided otherwise herein, it shall be a condition precedent to
the Executive's right to receive any Bonusable Amount that the Executive be
employed by the Company on the last day of that calendar year, regardless of any
subsequent termination of employment. In the absolute discretion of the
Compensation Committee, the Executive may be entitled to receive an additional
bonus, as and if the Compensation Committee shall determine from time to time.

      3.3 Expenses. During the Employment Period, the Executive shall be
entitled to reimbursement of all travel, entertainment and other business
expenses reasonably incurred in the performance of his duties for the Company,
upon submission of all receipts and accounts with respect thereto, and approval
by the Company thereof, in accordance with the business expense reimbursement
policies adopted by the Company from time to time.

      3.4 Vacation. In respect of each calendar year falling within the
Employment Period, the Executive shall be entitled to four (4) weeks of
vacation, or if greater, the number of weeks of vacation proscribed by the
vacation policies of the Company then in effect from time to time, provided that
unused vacation may be used by the Executive in the following calendar year only
in accordance with and as permitted by the Company's then current vacation
policies in effect from time to time.

      3.5 Other Fringe Benefits. During the Employment Period, if, as and when
they are being provided to other employees of the Company holding positions with
the Company comparable to the Executive's position, the Executive shall also be
entitled to receive health insurance benefits, disability benefits and
retirement benefits and other fringe benefits.

      3.6 Grant of Stock Option. In part as recompense for his job performance
in 2004 and in part as additional consideration for the Executive's execution
and delivery of this Agreement, conferral upon the Company of the covenants set
forth in Article IV hereof, and the Executive's performance of his duties
hereunder, concurrently with the execution and delivery of this Agreement, the
parties are executing and delivering the Option Agreement pursuant to which the
Company has granted to the Executive an Option to purchase fifty thousand
(50,000) Shares for a per Share purchase price of equal to the mean of the final
"asked" and "bid" prices of the Shares on the date hereof, in accordance with
the provisions of the Equity Compensation Plan.

                                       5
<PAGE>

                                   ARTICLE IV
                            COVENANTS OF THE EMPLOYEE

      4.1 Proprietary Rights. The Executive hereby expressly agrees that all
research, Biological Materials, discoveries, inventions and innovations (whether
or not reduced to practice or documented), improvements, developments, methods,
designs, analyses, drawings, reports and all similar or related information
(whether patentable or unpatentable, and whether or not reduced to writing),
trade secrets (being information about the business of the Company, its
Subsidiaries and their Affiliates which is considered by the Company or any such
Subsidiary or Affiliate to be confidential and is proprietary to the Company or
any such Subsidiary or Affiliate) and confidential information, copyrightable
works, and similar and related information (in whatever form or medium), which
(x) either (i) relate to the Company's, its Subsidiaries' or their Affiliates'
actual or anticipated business, research and development or existing or future
products or services or (ii) result from any work performed by the Executive for
the Company, its Subsidiaries or any of their Affiliates and (y) are conceived,
developed, made or contributed to in whole or in part by the Executive during
the Employment Period ("Work Product") shall be and remain the sole and
exclusive property of the Company, such Subsidiary or such Affiliate, as the
case may be. The Executive shall communicate promptly and fully all Work Product
to the Company.

            (a) Work Made for Hire. The Executive acknowledges that, unless
      otherwise agreed in writing by the Company, all Work Product eligible for
      any form of copyright protection made or contributed to in whole or in
      part by the Executive within the scope of the Executive's employment by
      the Company during the Employment Period shall be deemed a "work made for
      hire" under the copyright laws and shall be owned by the Company, its
      Subsidiaries or their Affiliates, as applicable.

            (b) Assignment of Proprietary Rights. The Executive hereby assigns,
      transfers and conveys to the Company, and shall assign, transfer and
      convey to the Company, all right, title and interest in and to all
      inventions, ideas, improvements, designs, processes, trademarks, service
      marks, trade names, trade secrets, trade dress, data, discoveries and
      other proprietary assets and proprietary rights in and of the Work Product
      (the "Proprietary Rights") for the Company's exclusive ownership and use,
      together with all rights to sue and recover for past and future
      infringement or misappropriation thereof, provided that if a Subsidiary or
      Affiliate of the Company is the owner thereof, such assignment, transfer
      and conveyance shall be made to such Subsidiary or Affiliate, , as the
      case may be, which shall enjoy exclusive ownership and use, together with
      all rights to sue and recover for past and future infringement or
      misappropriation thereof.

            (c) Further Instruments. At the request of the Company (its
      Subsidiaries or their Affiliates, as the case may be), at all times during
      the Employment Period and thereafter, the Executive will promptly and
      fully assist the Company (its Subsidiaries or their Affiliates, as the
      case may be) in effecting the purpose of the foregoing assignment,
      including but not limited to the further acts of executing any and all
      documents necessary to secure for the Company (its Subsidiaries or their
      Affiliates, as the case may be) such Proprietary Rights and other rights
      to all Work Product and all confidential information related thereto,
      providing cooperation and giving testimony.

                                       6
<PAGE>

            (d) Inapplicability of Section 4.1 In Certain Circumstances. The
      Company expressly acknowledges and agrees that, and the Executive is
      hereby advised that, this Section 4.1 does not apply to any invention for
      which no equipment, supplies, facilities or trade secret information of
      the Company, its Subsidiaries or any of their Affiliates was used and
      which was developed entirely on the Executive's own time, unless (i) the
      invention relates to the business of the Company, its Subsidiaries or any
      of their Affiliates or to the Company's, its Subsidiaries' or any of their
      Affiliates' actual or demonstrably anticipated research or development or
      (ii) the invention results from any work performed by the Executive for
      the Company, its Subsidiaries or any of their Affiliates.

      4.2 Ownership and Covenant to Return Documents, etc. The Executive agrees
that all Work Product and all documents or other tangible materials (whether
originals, copies or abstracts), including without limitation, price lists,
quotation guides, outstanding quotations, books, records, manuals, files, sales
literature, training materials, customer records, correspondence, computer disks
or print-out documents, contracts, orders, messages, phone and address lists,
invoices and receipts, and all objects associated therewith, which in any way
relate to the business or affairs of the Company, its Subsidiaries and their
Affiliates either furnished to the Executive by the Company, its Subsidiaries or
any of their Affiliates or are prepared, compiled or otherwise acquired by the
Executive during the Employment Period, shall be the sole and exclusive property
of the Company, such Subsidiaries or such Affiliates, as the case may be. The
Executive shall not, except for the use of the Company, its Subsidiaries or any
of their Affiliates, use, copy or duplicate any of the aforementioned documents
or objects, nor remove them from the facilities of the Company or such
Subsidiaries or such Affiliates, , as the case may be, nor use any information
concerning them except for the benefit of the Company, its Subsidiaries and
their Affiliates, either during the Employment Period or thereafter. The
Executive agrees that he will deliver all of the aforementioned documents and
objects that may be in his possession to the Company on the termination of his
employment with the Company, or at any other time upon the Company's request,
together with his written certification of compliance with the provisions of
this Section 4.2 in the form of Exhibit B to this Agreement in accordance with
the provisions of Section 5.3 hereof.

      4.3 Non-Disclosure Covenant. For a period commencing on the date of this
Agreement and ending on the last to occur of five (5) years following the date
of execution of this Agreement or three (3) years following the date of the
termination of the Employment Period (the "Non-Disclosure Period"), the
Executive shall not, either directly or indirectly, disclose to any
"unauthorized person" or use for the benefit of the Executive or any Person
other than the Company, its Subsidiaries or their Affiliates any Work Product or
any knowledge or information which the Executive may acquire while employed by
the Company (whether before or after the date of this Agreement) relating to (i)

                                       7
<PAGE>

the financial, marketing, sales and business plans and affairs, financial
statements, analyses, forecasts and projections, books, accounts, records,
operating costs and expenses and other financial information of the Company, its
Subsidiaries and their Affiliates, (ii) internal management tools and systems,
costing policies and methods, pricing policies and methods and other methods of
doing business, of the Company, its Subsidiaries and their Affiliates, (iii)
customers, sales, customer requirements and usages, distributor lists, of the
Company, its Subsidiaries and their Affiliates, (iv) agreements with customers,
vendors, independent contractors, employees and others, of the Company, its
Subsidiaries and their Affiliates, (v) existing and future products or services
and product development plans, designs, analyses and reports, of the Company,
its Subsidiaries and their Affiliates, (vi) computer software and data bases
developed for the Company, its Subsidiaries or their Affiliates, trade secrets,
research, records of research, models, designs, drawings, technical data and
reports of the Company, its Subsidiaries and their Affiliates and (vii)
correspondence or other private or confidential matters, information or data
whether written, oral or electronic, which is proprietary to the Company, its
Subsidiaries and their Affiliates and not generally known to the public
(individually and collectively "Confidential Information"), without the
Company's prior written permission. For purposes of this Section 4.3, the term
"unauthorized person" shall mean any Person who is not (i) an officer or
director of the Company or an employee of the Company for whom the disclosure of
the knowledge or information referred to herein is necessary for his performance
of his assigned duties, or (ii) an employee, officer or director of a Subsidiary
or Affiliate of the Company for whom the disclosure of the knowledge or
information referred to herein is necessary for his performance of his assigned
duties, or (iii) a Person expressly authorized by the Company to receive
disclosure of such knowledge or information. The Company expressly acknowledges
and agrees that the term "Confidential Information" excludes information which
is (A) in the public domain or otherwise generally known to the trade, or (B)
disclosed to third parties other than by reason of the Executive's breach of his
confidentiality obligation hereunder or (C) learned of by the Executive
subsequent to the termination of his employment hereunder from any other party
not then under an obligation of confidentiality to the Company, its Subsidiaries
and their Affiliates. Further, the Executive covenants to the Company that in
the Executive's performance of his duties hereunder, the Executive will violate
no confidentiality obligations he may have to any third Persons.

      4.4 Non-Interference Covenants. The Executive covenants to the Company
that while the Executive is employed by the Company hereunder and for the two
(2) year period thereafter (the "Non-Interference Period"), he will not, for any
reason, directly or indirectly: (a) solicit, hire, or otherwise do any act or
thing which may induce any other employee of the Company, its Subsidiaries or
their Affiliates to leave the employ or otherwise interfere with or adversely
affect the relationship (contractual or otherwise) of the Company, its
Subsidiaries and their Affiliates with any person who is then or thereafter
becomes an employee of the Company, its Subsidiaries and their Affiliates; (b)
do any act or thing which may interfere with or adversely affect the
relationship (contractual or otherwise) of the Company, its Subsidiaries and
their Affiliates with any vendor of goods or services to the Company, its
Subsidiaries and their Affiliates or induce any such vendor to cease doing
business with the Company, its Subsidiaries and their Affiliates; or (c) except
for Competitive Activities (as defined in Section 4.5) engaged in by the
Employee after the expiration of the Non-Competition Period, do any act or thing
which may interfere with or adversely affect the relationship (contractual or
otherwise) of the Company, its Subsidiaries and their Affiliates with any
customer of the Company, its Subsidiaries and their Affiliates or induce any
such customer to cease doing business with the Company, its Subsidiaries and
their Affiliates.

      4.5 Covenant Not To Compete. The Executive expressly acknowledges that (i)
the Executive's performance of his services for the Company hereunder will
afford him or her access to and cause him or her to become highly knowledgeable
about the Company's, its Subsidiaries' and their Affiliates' Confidential
Information; (ii) the agreements and covenants contained in this Section 4.5 are
essential to protect the Confidential Information, business and goodwill of the
Company, its Subsidiaries and their Affiliates, and the restraints on the
Executive imposed by the provisions of this Section 4.5 are justified by these
legitimate business interests of the Company; and (iii) his covenants to the

                                       8
<PAGE>

Company, its Subsidiaries and their Affiliates set forth in this Section 4.5 are
being made both in consideration of the Company's employment of the Executive in
the office to which the Executive has been promoted, the salary increase and
other financial benefits of this Agreement and the grant of the Option.
Accordingly, the Executive hereby agrees that during the Non-Competition Period
he shall not, anywhere in the Applicable Territory, directly or indirectly, own
any interest in, invest in, lend to, borrow from, manage, control, participate
in, consult with, become employed by, render services to, or in any other manner
whatsoever engage in, any business which is (x) competitive with the industrial
or commercial enzymes business actively being engaged in by the Company, its
Subsidiaries and their Affiliates in the Applicable Territory on the date of the
termination of the Employment Period, (y) competitive with the business of
providing high-throughput screening services to others or (z) competitive with
the business of providing of gene expression services to others (collectively,
"Competitive Activities"). The preceding to the contrary notwithstanding, the
Executive shall be free to make investments in the publicly traded securities of
any corporation, provided that such investments do not amount to more than 1% of
the outstanding securities of any class of such corporation.

      4.6 Remedies For Breach. If the Executive commits a breach, or threatens
to commit a breach, of any of the provisions of this Article IV, the Company and
its Subsidiaries shall have the right and remedy, in addition to any other
remedy that may be available at law or in equity, to have the provisions of this
Article IV specifically enforced by any court having equity jurisdiction, by the
entry of temporary, preliminary and permanent injunctions and orders of specific
performance, together with an accounting therefor, it being expressly
acknowledged and agreed by the Executive that any such breach or threatened
breach will cause irreparable injury to the Company and its Subsidiaries and
that money damages will not provide an adequate remedy to the Company and its
Subsidiaries. Any such injunction shall be available without the posting of any
bond or other security, and the Executive hereby consents to the issuance of
such injunction. The Executive further agrees that any such injunctive relief
obtained by the Company or its Subsidiaries shall be in addition to, and not in
lieu of, monetary damages and any other remedies to which the Company or its
Subsidiaries may be entitled. Further, in the event of an alleged breach or
violation by the Executive of any of the provisions of Sections 4.3, 4.4 or 4.5
hereof, the Non-Disclosure Period, the Non-Interference Period and\or the
Non-Competition Period, as the case may be, shall be tolled until such breach or
violation has been cured. The parties agree that in the event of the institution
of any action at law or in equity by either party to enforce the provisions of
this Article IV, the losing party shall pay all of the costs and expenses of the
prevailing party, including reasonable legal fees, incurred in connection
therewith. If any covenant contained in this Article IV or any part thereof is
hereafter construed to be invalid or unenforceable, the same shall not affect
the remainder of such covenant or any other covenants, which shall be given full
effect, without regard to the invalid portions, and any court having
jurisdiction shall have the power to modify such covenant to the least extent
necessary to render it enforceable and, in its modified form, said covenant
shall then be enforceable.

                                       9
<PAGE>

                                    ARTICLE V
                            TERMINATION OF EMPLOYMENT

      5.1 Termination and Triggering Events. Notwithstanding anything to the
contrary elsewhere contained in this Agreement, the Employment Period shall
terminate at the expiration of the Initial Term or any Extension Term, or prior
to the expiration of the Initial Term or any Extension Term upon the occurrence
of any of the following events (hereinafter referred to as "Triggering Events"):
(a) the Executive's death; (b) the Executive's Total Disability; (c) the
Executive's Resignation; (d) a Termination by the Company for Cause; or (f) a
Termination by the Company Without Cause.

      5.2 Rights Upon Occurrence of a Triggering Event. Subject to the
provisions of Section 5.3 hereof, the rights of the parties upon the occurrence
of a Triggering Event prior to the expiration of the Initial Term or any
Extension Term shall be as follows:

            (a) Resignation and Termination by the Company for Cause: If the
      Triggering Event was the Executive's Resignation or a Termination by the
      Company for Cause, the Executive shall be entitled to receive his Annual
      Base Compensation and accrued but unpaid vacation through the date thereof
      in accordance with the policy of the Company, and to continue to
      participate in the Company's health, insurance and disability plans and
      programs through that date and thereafter, only to the extent permitted
      under the terms of such plans and programs.

            (b) Death or Total Disability: If the Triggering Event was the
      Executive's death or Total Disability, the Executive (or the Executive's
      designated beneficiary) shall be entitled to receive the Executive's
      Annual Base Compensation and accrued but unpaid vacation through the date
      thereof plus a pro rata portion of the Executive's Potential Annual Target
      Bonus for the calendar year in which such death or Total Disability
      occurred (based on the number of days the Executive was employed during
      the applicable calendar year), in accordance with the policy of the
      Company, and to continue to participate in the Company's health, insurance
      and disability plans and programs through the date of termination and
      thereafter only to the extent permitted under the terms of such plans and
      programs.

            (c) Termination by Company Without Cause: If the Triggering Event
      was a Termination by the Company Without Cause, the Executive shall be
      entitled to receive his Annual Base Compensation and accrued but unpaid
      vacation through the date thereof plus, in the reasonable discretion of
      the Chief Executive Officer based upon whether it then appears the
      Potential Annual Target Bonus for the year would have been earned by the
      Executive had he remained employed by the Company, a pro rata portion of
      the Executive's Potential Annual Target Bonus for the calendar year in
      which such Triggering Event occurred (based on the number of days the

                                       10
<PAGE>

      Executive was employed during the applicable calendar year), payable in
      accordance with the Company's normal payroll practices, provided that in
      addition, for each month of the Severance Period hereinafter referred to,
      the Executive shall also be paid an amount per month equal to one-twelfth
      (1/12th) of his then current Annual Base Compensation in weekly,
      bi-monthly or monthly installments, as the case may be, consistent with
      the Company's normal payroll practices, commencing with the first regular
      payroll payment date following the termination of the Employment Period
      (collectively, the "Additional Severance Benefits"); further provided that
      the Executive shall be entitled to receive such Additional Severance
      Benefits during the Severance Period if and only if the Executive has
      executed and delivered to the Company the General Release substantially in
      form and substance as set forth in Exhibit C to this Agreement and only so
      long as the Executive has not breached any of his covenants to the Company
      set forth in Article IV of this Agreement.

            (d) Cessation of Entitlements and Company Right of Offset. Except as
      otherwise expressly provided herein, all of the Executive's rights to
      salary, employee benefits, fringe benefits and bonuses hereunder (if any)
      which would otherwise accrue after the termination of the Employment
      Period shall cease upon the date of such termination. The Company may
      offset any loans, cash advances or fixed amounts which the Executive owes
      the Company or its Affiliate against any amounts it owes the Executive
      under this Agreement.

      5.3 Survival of Certain Obligations and Termination Certificate. The
provisions of Articles IV, V, VI and VIII shall survive any termination of the
Employment Period, whether by reason of the occurrence of a Triggering Event or
the expiration of the Initial Term or any Extension Term. Immediately following
the termination of the Employment Period, the Executive shall promptly return to
the Company all property required to be returned to the Company pursuant to the
provisions of Section 4.2 hereof and execute and deliver to the Company the
Termination Certificate attached hereto as Exhibit B and by this reference made
a part hereof.

                                   ARTICLE VI
                                   ASSIGNMENT

      6.1 Prohibition of Assignment by Executive. The Executive expressly agrees
for himself and on behalf of his executors, administrators and heirs, that this
Agreement and his obligations, rights, interests and benefits hereunder shall
not be assigned, transferred, pledged or hypothecated in any way by the
Executive, his executors, administrators or heirs, and shall not be subject to
execution, attachment or similar process. Any attempt to assign, transfer,
pledge, hypothecate or otherwise dispose of this Agreement or any such rights,
interests and benefits thereunder contrary to the foregoing provisions, or the
levy of any attachment or similar process thereupon shall be null and void and
without effect and shall relieve the Company of any and all liability hereunder.

      6.2 Right of Company to Assign. Except as provided in the next sentence,
the rights, but not the obligations of the Company shall be assignable and
transferable to any successor-in-interest without the consent of the Executive.
In the instance of a sale of the Company or the sale of all or substantially all
of the assets of the Company or the BioSciences Business, this Agreement and the
rights and obligations of the Company hereunder may be assigned to the acquiring
party without the Executive's consent, and for purposes of this Agreement, such
acquirer shall thereafter be deemed to be the Company.

                                       11
<PAGE>

                                   ARTICLE VII
                                   DEFINITIONS

      "Affiliate" means, with respect to any Person, any other Person directly
or indirectly controlling, controlled by, or under common control with that
Person, provided that, for purposes of this definition, the terms "controls,"
"controlled by," or "under common control with" shall mean that Person's
possession, directly or indirectly, of the power or right, alone or together
with one or more partners or co-joint venturers, to direct or cause the
direction of the management and policies of such other Person through
representation on its controlling management and policy-making body or
otherwise, whether through the ownership of voting securities, by contract or
otherwise.

      "Applicable Territory" means the United States of America and each other
country in which the Company, any of its Subsidiaries or any of their Affiliates
is actively engaged in the conduct of one or more lines of business.

      "Board" means the Board of Directors of the Company.

      "Biological Materials" means (i) classical or genetically modified
strains, micro or other organisms, genes, proteins, peptides, sugars,
metabolites, small molecules, enzymes or DNA, vectors, plasmids, promoters,
expression cassettes or other genomic tools and assay materials which are being
worked with or on by the Company, its Subsidiaries or any of their Affiliates or
which are being worked with or on the Company's, its Subsidiaries' or any of
their Affiliates' behalf by the Company's, its Subsidiaries' or any of their
Affiliates' advisors, research and business collaborators, and (ii) "Biological
Materials" and fermentation or other manufacturing processes being utilized by
the Company, its Subsidiaries or any of their Affiliates, the Company's, its
Subsidiaries' or any of their Affiliates' research or business collaborators or
the Company's, its Subsidiaries' or any of their Affiliates' third party
manufactures for research, pilot scale and/or commercial manufacture of
biotechnology and other products.

      "Change of Control" means the occurrence of any of the following events:

            (i) a sale, lease, exchange or other transfer (in one transaction or
      a series of related transactions) of all or substantially all of the
      assets of the Company;

            (ii) there shall be consummated any consolidation or merger of the
      Company with any other Person other than a merger or consolidation of the
      Company in which the holders of Company's outstanding voting securities
      ordinarily having the right to vote for the election of directors
      immediately prior to such merger or consolidation directly or indirectly
      possess, immediately following such merger or consolidation, not less than
      a majority of the outstanding voting securities of the surviving
      corporation ordinarily having the right to vote for the election of
      directors;

            (iii) any "person" or "group" (as such terms are used in Section
      13(d) and 14(d) of the Exchange Act of 1934, as amended (the "Exchange
      Act")) not today a beneficial owner (as defined in Rule 13d-3 under the
      Exchange Act) of voting securities of the Company ordinarily having the

                                       12
<PAGE>

      right to vote for the election of directors, becomes the beneficial owner,
      directly or indirectly, of securities of the Company representing more
      than 50% of the combined voting power of the Company's then outstanding
      voting securities having that right to vote for the election of directors,
      provided that no Change of Control shall be deemed to have occurred as a
      result of any acquisition of voting securities directly from the Company
      (or as the result of the exercise, conversion or exchange of any
      securities acquired directly from the Company) if the transaction pursuant
      to which such voting securities or exercisable, convertible or
      exchangeable securities are issued is approved by the vote of at least a
      majority of the directors who were members of the Board one calendar month
      prior to the date of the Board's approval of such transaction;

            (iv) a sale, lease, exchange or other transfer (in one transaction
      or a series of related transactions) of all or substantially all of the
      assets used in the conduct of the BioSciences Business to any Person
      which, following the consummation of that transaction, is not an Affiliate
      of the Company, provided that the sale or license of the Company's C1 Host
      Technology incident to which the Company, or any Subsidiary or Affiliate
      of the Company, retains a right to use the C1 Host Technology and/or any
      application or derivation thereof for use in the conduct of the
      BioSciences Business shall not constitute a sale, lease, exchange or other
      transfer of the assets used in the BioSciences Business to which this
      clause (iv) shall apply, unless the retained licenses are a small portion
      of the then addressable markets for the C1 Host Technology for the
      BioSciences Business; or

            (v) there shall be consummated any consolidation or merger of any
      Subsidiary or Affiliate of the Company that owns substantially all of the
      assets used in the conduct of the BioSciences Business with any Person, if
      the entity surviving that consolidation or merger is not an Affiliate of
      the Company, provided that the merger or consolidation of any Subsidiary
      or Affiliate that holds legal title to the Company's C1 Host Technology
      incident to which the Company, or any Subsidiary or Affiliate of the
      Company, retains a right to use the C1 Host Technology and/or any
      application or derivation thereof for use in the conduct of the
      BioSciences Business shall not constitute a consolidation or merger of any
      Subsidiary or Affiliate of the Company that owns substantially all of the
      assets used in the conduct of the BioSciences Business to which this
      clause (v) shall apply, unless the retained licenses are a small portion
      of the then addressable markets for the C1 Host Technology for the
      BioSciences Business.

      "Chief Executive Officer" means the chief executive officer of the
Company.

      "Compensation Committee" means the Compensation Committee of the Board.

      "Constructive Termination Without Cause" means a voluntary termination of
Executive's employment by the Executive within twelve (12) months following the
occurrence of a Change of Control and within 60 days following the occurrence of
any of the following events: (i) the Company's assignment to the Executive of
any duties inconsistent in any material respect with the Executive's position
(including status, offices and titles), authority, duties or responsibilities as

                                       13
<PAGE>

contemplated by Section 1.3 hereof which results in a diminution of the
Executive's position, excluding for this purpose and isolated, insubstantial or
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after the receipt of written notice thereof by the Executive; (ii) the
Executive's Annual Base Compensation and\or Potential Annual Target Bonus is\are
reduced below the amount of his then Annual Base Compensation and\or Potential
Annual Target Bonus fixed by the applicable provisions of Sections 3.1 and 3.2
hereof; (iii) the Executive is required by the Company to relocate his personal
residence outside of a 50 mile radius of the Company's current principal place
of business; or (iv) the failure of the Company or its legal
successor-in-interest to comply with any of the provisions of this Agreement,
other than an isolated, insubstantial or inadvertent action not taken in bad
faith and which is remedied by the Company promptly after the receipt of written
notice thereof by the Executive.

      "Non-Competition Period" means the Employment Period and the eighteen (18)
month period thereafter.

      "Person" means an individual, partnership, limited liability company,
trust, estate, association, corporation, governmental body or other juridical
being.

      "Resignation" means the voluntary termination of employment hereunder by
the Executive (except if made in contemplation of a Termination by the Company
for Cause), provided that if such action is taken by the Executive without the
giving of at least ninety (90) days prior written notice, such termination of
employment shall not be a "Resignation," but instead shall constitute a
Termination for Cause, further provided that the termination of the Employment
Period on account of the failure of the Executive to extend the Employment
Period in accordance with the provisions of Section 2.2 hereof shall constitute
a Resignation.

            "Severance Period" means: (i) the six (6) month period immediately
following the date of the termination of the Employment Period; provided that
(ii) if (A) the Executive has been an employee of the Company or any Subsidiary
or Affiliate for at least five consecutive years and (B) the Executive's
employment was terminated either (x) by the Company as a Termination by the
Company Without Cause or (y) by the Executive on account of the occurrence of a
Constructive Termination Without Cause at anytime within twelve (12) months
following the occurrence of a Change of Control, the term "Severance Period"
means the eighteen (18) month period immediately following the termination of
the Employment Period.

            "Subsidiary" means, with respect to any Person of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of such Person or a combination thereof, or (ii) if a limited liability company,
partnership, association or other business entity, a majority of the partnership
or other similar ownership interest thereof is at the time owned or controlled,

                                       14
<PAGE>

directly or indirectly, by any Person or one or more Subsidiaries of such Person
or a combination thereof. For purposes hereof, a Person or Persons shall be
deemed to have a majority ownership interest in a limited liability company,
partnership, association or other business entity if such Person or Persons
shall be allocated a majority of limited liability company, partnership,
association or other business entity gains or losses or shall be or control any
managing director or general partner of such limited liability company,
partnership, association or other business entity.

      "Termination by the Company for Cause" means termination by the Company of
the Executive's employment on or before the expiration of the Initial Term or
any Extension Term, as the case may be, on account of a finding by the
Compensation Committee that the Executive has: (i) breached this Agreement or
any other agreement between the Executive and the Company, any Subsidiary or any
of their Affiliates; (ii) engaged in disloyalty to the Company, including
without limitation, the diversion of corporate opportunity, fraud, embezzlement,
theft, commission of a felony or proven dishonesty, in the course of his
performance of his services hereunder; (iii) disclosed trade secrets or other
Confidential Information of the Company to Persons not entitled to receive such
information; or (iv) engaged in such other behavior detrimental to the interests
of the Company as the Compensation Committee determines; provided that the
termination of the Executive's employment hereunder by the Company shall not be
deemed a Termination by the Company for Cause unless and until there shall have
been delivered to the Executive a written notice from the Chief Executive
Officer (after reasonable notice (in light of the circumstances surrounding the
termination) to and an opportunity for the Executive, alone and in person, to
have a face-to-face meeting with the Compensation Committee) stating that in the
good faith opinion of the Compensation Committee, the Executive was guilty of
the conduct set forth in one or more of the foregoing clauses.

      "Termination by the Company Without Cause" means a termination of the
Executive's employment by the Company on or before the expiration of the Initial
Term or any Extension Term, as the case may be, which is not a Termination by
the Company for Cause, provided that the termination of the Employment Period on
account of the failure of the Company to extend the Employment Period in
accordance with the provisions of Section 2.2 hereof shall constitute a
Termination by the Company Without Cause.

      "Total Disability" means the Executive's inability, because of illness,
injury or other physical or mental incapacity, to perform his duties hereunder
(as determined by the Compensation Committee in good faith) for a continuous
period of ninety (90) consecutive days, or for a total of ninety (90) days
within any three hundred sixty (360) consecutive day period, in which case such
Total Disability shall be deemed to have occurred on the last day of such ninety
(90) day or three hundred sixty (360) day period, as applicable.

                                  ARTICLE VIII
                                     GENERAL

      8.1 Notices. All notices under this Agreement shall be in writing and
shall be deemed properly sent, (i) when delivered, if by personal service or
reputable overnight courier service, or (ii) when received, if sent (x) by
certified or registered mail, postage prepaid, return receipt requested, or (y)
via facsimile transmission (provided that a hard copy of such notice is sent to
the addressee via one of the methods of delivery or mailing set forth above on
the same day the facsimile transmission is sent); to (A) the Executive at the
address of his principal place of residence on file with the Company from time
to time and (B) to the Company, as follows:

                                       15
<PAGE>

            Dyadic International, Inc.
            c/o Chief Executive Officer
            140 Intracoastal Pointe Drive, Suite 404
            Jupiter, Florida  33477
            Facsimile (561) 743-8513

            With a copy to:

            Robert I. Schwimmer, Esq.
            Jenkens & Gilchrist
            225 West Washington, Suite 2600
            Chicago, Illinois 60606
            Facsimile (312) 425-3909

      8.2 Governing Law. This Agreement shall be subject to and governed by the
laws of the State of Florida without regard to any choice of law or conflicts of
law rules or provisions (whether of the State of Florida or any other
jurisdiction), irrespective of the fact that the Executive may become a resident
of a different state.

      8.3 Binding Effect. The Agreement shall be binding upon and inure to the
benefit of the Company, its successors and assigns, and the Executive and his
executors, administrators, personal representatives and heirs.

      8.4 Complete Understanding. This Agreement constitutes the complete
understanding among the parties hereto with regard to the subject matter hereof,
and supersedes any and all prior agreements and understandings relating to the
terms of Executive's employment by the Company, provided that that certain
Confidential Information, Inventions Assignment and Non-Compete Agreement
between the Company's Subsidiary and the Executive dated May 1, 2001 and that
certain Employment Agreement between the Company's Subsidiary and the Executive
dated May 26, 2000, each of which was assigned by that Subsidiary to the Company
on October 29, 2004 (collectively, the "Prior Employment and Proprietary Rights
Agreements"), shall, to the extent not inconsistent with the terms and
provisions of this Agreement, remain in full force and effect as to any rights
and obligations of the parties thereunder in existence prior to the date of this
Agreement, further provided that in the event of any inconsistency between the
provisions of this Agreement and the provisions of either or both of the Prior
Employment and Proprietary Rights Agreements, or in the event of any
inconsistency between the rights and obligations of the parties under this
Agreement and the rights and obligations of the parties under either or both of
the Prior Employment and Proprietary Rights Agreements, in either instance, the
provisions of this Agreement shall control.

      8.5 Amendments. No change, modification or amendment of any provision of
this Agreement shall be valid unless made in writing and signed by all of the
parties hereto.

      8.6 Waiver. The waiver by the Company of a breach of any provision of this
Agreement by the Executive shall not operate or be construed as a waiver of any
subsequent breach by the Executive. The waiver by the Executive of a breach of
any provision of this Agreement by the Company shall not operate as a waiver of
any subsequent breach by the Company.

                                       16
<PAGE>

      8.7 Venue, Jurisdiction, Etc. The Executive hereby agrees that any suit,
action or proceeding relating in any way to this Agreement may be brought and
enforced in the Circuit Court of Palm Beach County of the State of Florida or in
the District Court of the United States of America for the Southern District of
Florida, and in either case the Executive hereby submits to the jurisdiction of
each such court. The Executive hereby waives and agrees not to assert, by way of
motion or otherwise, in any such suit, action or proceeding, any claim that the
Executive is not personally subject to the jurisdiction of the above-named
courts, that the suit, action or proceeding is brought in an inconvenient forum
or that the venue of the suit, action or proceeding is improper. The Executive
consents and agrees to service of process or other legal summons for purpose of
any such suit, action or proceeding by registered mail addressed to the
Executive at his or her address listed in the business records of the Company.
Nothing contained herein shall affect the rights of the Company to bring suit,
action or proceeding in any other appropriate jurisdiction. The Executive and
the Company do each hereby waive any right to trial by jury, he or it may have
concerning any matter relating to this Agreement.

      8.8 Severability. If any portion of this Agreement shall be for any
reason, invalid or unenforceable, the remaining portion or portions shall
nevertheless be valid, enforceable and carried into effect.

      8.9 Headings. The headings of this Agreement are inserted for convenience
only and are not to be considered in the construction of the provisions hereof.

      8.10 Counterparts. This Agreement may be executed in one or more
counterparts, all of which, taken together, shall constitute one and the same
agreement.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above-written.

COMPANY:                                        EXECUTIVE:

DYADIC INTERNATIONAL, INC., a
Delaware Corporation
                                                ------------------------------
                                                     Ratnesh (Ray) Chandra

 By:____________________________
         Chief Executive Officer


                                       17
<PAGE>


                                    EXHIBIT A
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                              RATNESH (RAY) CHANDRA


                             STOCK OPTION AGREEMENT


                                       18
<PAGE>

                           DYADIC INTERNATIONAL, INC.
                          2001 EQUITY COMPENSATION PLAN
                          STOCK OPTION GRANT AGREEMENT

      This STOCK OPTION GRANT AGREEMENT (this "Agreement"), dated as of March
30, 2005 (the "Date of Grant"), is delivered by Dyadic International, Inc. (the
"Company") to Ratnesh (Ray) Chandra (the "Grantee").

                                    RECITALS

      A. Concurrently with the execution and delivery of this Agreement, the
Grantee has entered into an employment agreement with the Company dated of even
date herewith (as may be amended, restated or otherwise modified, the
"Employment Agreement"), pursuant to which the Grantee will serve as the
Company's Senior Vice President, Marketing - Biotechnology Systems.

      B. The Dyadic International, Inc. 2001 Equity Compensation Plan (as may be
amended, restated or otherwise modified, the "Plan") provides for the grant of
options to purchase shares of common stock of the Company. A copy of the Plan
has heretofore been furnished to the Grantee, receipt of which is hereby
expressly acknowledged. Capitalized terms used but not otherwise defined herein
shall have the meanings given such terms in the Plan.

      C. As contemplated in Section 1(a) of the Plan, the Board of Directors of
the Company has appointed a committee (the "Committee") to administer the Plan.

      D. To induce the Grantee to enter into the Employment Agreement and
continue to perform the obligations specified therein and promote the best
interests of the Company, the Committee has decided to Grant an Option to the
Grantee under the Plan to purchase shares of Company Stock ("Shares").

                                   AGREEMENT:

      NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:

1. Grant of Option. Subject to the terms and conditions set forth in this
Agreement and in the Plan, the Company hereby grants to the Grantee an Option to
purchase 50,000 Shares at an exercise price of $3.025 per Share (which is the
Fair Market Value on the date of Grant, being equal to the mean of the final
"asked" and "bid" prices of the Shares on the date hereof, as fixed by the terms
of the Plan). The Option shall become exercisable in accordance with the terms
of Paragraph 2 below. In accordance with Section 5(g) of the Plan, the Option
shall be treated as an Incentive Stock Option


                                       2
<PAGE>

except to the extent that the aggregate Fair Market Value of the Shares as of
the date of the grant with respect to which Incentive Stock Option is for the
first time exercisable by the Grantee during any calendar year under the Plan
exceeds $100,000, then the Option, as to such excess, shall be treated as a
Nonqualified Stock Option.

2. Exercisability of Option. The number of Shares in respect of which the
Grantee shall be permitted to exercise the Option shall be determined by
reference to the dates (each a "Vesting Date") fixed in the table set forth
below, provided that: (a) exercisability of Shares is cumulative; and (b) there
must not have occurred a termination of the Grantee's employment with the
Company (the "Employment Relationship") for any reason whatsoever (the date of
such termination being hereinafter referred to as the "Termination Date") prior
to a Vesting Date in order for the Option to be exercisable in respect of the
Shares indicated opposite that Vesting Date:

            Vesting Date                  Additional   Shares  for  Which  the
                                                  Option is Exercisable
      1st Anniversary of Date of Grant                1/4th of Option Shares
      2nd Anniversary of Date of Grant                1/4th of Option Shares
      3rd Anniversary of Date of Grant                1/4th of Option Shares
      4th Anniversary of Date of Grant                1/4th of Option Shares

3. Term of Option.

      (a) The Option shall be exercisable for a term commencing with the Date of
Grant and ending on the earlier of (i) the fifth (5th) anniversary of the Date
of Grant or (ii) the termination of the Plan, unless the Option is terminated at
an earlier date in accordance with the provisions of this Agreement or the Plan.

      (b) Any portion of the Option that is not exercisable on the Termination
Date shall terminate on that date.

      (c) The Option, to the extent exercisable, shall automatically terminate
upon the earlier of (x) the expiration of the period fixed in Paragraph 3(a),
above, or (y) the first to occur of any of the following events:

            (i) Subject to clause (v) below, the expiration of the 90 day period
      following the Termination Date, if the termination is for any reason other
      than the Disability of the Grantee, his death or for Cause.

            (ii) Subject to clause (v) below, the expiration of the one (1) year
      period after the Termination Date, to the extent the Option is then
      unvested, if the termination of the Employment Relationship was on account
      of the Grantee's Disability.
            (iii) The expiration of the one (1) year period after the
      Termination Date, if the reason for the termination of the Employment
      Relationship was on account of the Grantee's death.

                                       3
<PAGE>

            (iv) The Termination Date, if the termination of the Employment
      Relationship was for Cause.

            (v) The provisions of clauses (i) and (ii) above to the contrary
      notwithstanding, if the Grantee engages in conduct that constitutes Cause
      after the Termination Date, the Option shall immediately terminate to the
      extent then unexercised (regardless of vesting).

      (d) In accordance with Section 5(e)(ii) of the Plan, if the provisions of
either clause (iv) or clause (v) of Paragraph 3(c) applied to the termination of
the Option, the Grantee shall automatically forfeit all Shares underlying any
exercised portion of the Option for which the Company has not yet delivered the
share certificates, upon refund by the Company of the exercise price paid by the
Grantee for such Shares.

4. Exercise Procedures.

      (a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee may
exercise part or all of the exercisable portion of the Option by giving the
Committee written notice of intent to exercise in the manner provided in this
Agreement, specifying the number of Shares as to which the Option is to be
exercised. On the delivery date, the Grantee shall pay the exercise price (i) in
cash, (ii) with the approval of the Committee, by delivering Shares of the
Company which shall be valued at their fair market value on the date of delivery
(such valuation to be determined in the manner fixed in the Plan), (iii) payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board or (iv) by such other method as the Committee may approve,
provided that the Committee may, in its absolute discretion, impose from time to
time such limitations as it deems appropriate on the use of Shares of the
Company to exercise the Option.

      (b) The obligation of the Company to deliver Shares upon exercise of the
Option shall be subject to all applicable laws, rules, and regulations and such
approvals by governmental agencies as may be deemed appropriate by the
Committee, including such actions as Company counsel shall deem necessary or
appropriate to comply with relevant securities laws and regulations. The Company
may require that the Grantee (or other person exercising the Option after the
Grantee's death) represent that the Grantee is purchasing Shares for the
Grantee's own account and not with a view to or for sale in connection with any
distribution of the Shares, or such other representation as the Committee deems
appropriate. All obligations of the Company under this Agreement shall be
subject to the rights of the Company as set forth in the Plan to withhold
amounts required to be withheld for any taxes, if applicable. Subject to
Committee approval, in its absolute discretion, the Grantee may elect to satisfy
any income tax withholding obligation of the Company with respect to the Option
by having Shares withheld up to an amount that does not exceed the minimum
applicable withholding tax rate for federal (including FICA), state and local
tax liabilities.

                                       4
<PAGE>

5. Restrictions on Transfer of Shares. In addition to the restrictions imposed
by the Plan on the transferability of the Shares acquired by an the Grantee's
exercise of the Option granted hereby, without the prior consent of the Company,
for so long as the Company is not a "Reporting Company" within the meaning of
the Exchange Act of 1934, as amended, the Grantee shall make no transfer of the
Shares (a) for a period of five (5) years following the date of this Agreement
and (b) thereafter, to any competitor of the Company.

6. Change of Control. The provisions of the Plan applicable to a Change of
Control shall apply to the Option, and, in the event of a Change of Control, the
Committee may take such actions as it deems appropriate pursuant to the Plan.

7. Restrictions on Exercise. Only the Grantee may exercise the Option during the
Grantee's lifetime and, after the Grantee's death, the Option shall be
exercisable (subject to the limitations specified in the Plan) solely by the
legal representatives of the Grantee, or by the person who acquires the right to
exercise the Option by will or by the laws of descent and distribution, to the
extent that the Option is exercisable pursuant to this Agreement.

8. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
the terms of which are incorporated herein by reference, and in all respects
shall be interpreted in accordance with the Plan. The grant and exercise of the
Option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) rights and obligations with respect
to withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) changes in capitalization of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the Option pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.

9. No Employment or Other Rights. The grant of the Option shall not confer upon
the Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any time for
any reason is specifically reserved.

10. No Shareholder Rights. Neither the Grantee, nor any person entitled to
exercise the Grantee's rights in the event of the Grantee's death, shall have
any of the rights and privileges of a shareholder with respect to the Shares
subject to the Option, until certificates for Shares have been issued upon the
exercise of the Option.

                                       5
<PAGE>

11. Assignment and Transfers. The rights and interests of the Grantee under this
Agreement may not be sold, assigned, encumbered or otherwise transferred except,
in the event of the death of the Grantee, by will or by the laws of descent and
distribution. In the event of any attempt by the Grantee to alienate, assign,
pledge, hypothecate, or otherwise dispose of the Option or any right hereunder,
except as provided for in this Agreement, or in the event of the levy or any
attachment, execution or similar process upon the rights or interests hereby
conferred, the Company may terminate the Option by notice to the Grantee, and
the Option and all rights hereunder shall thereupon become null and void. The
rights and protections of the Company hereunder shall extend to any successors
or assigns of the Company and to the Company's parents, subsidiaries, and
affiliates. This Agreement may be assigned by the Company without the Grantee's
consent.

12. Applicable Law. The validity, construction, interpretation and effect of
this instrument shall be governed by and construed in accordance with the laws
of the State of Florida, without giving effect to the conflicts of laws
provisions thereof.

13. Notice. Any notice to the Company provided for in this instrument shall be
addressed to the Company in care of the Chief Executive Officer at the Company's
principal executive offices, and any notice to the Grantee shall be addressed to
such Grantee at the current address shown on the payroll of the Company, or to
such other address as the Grantee may designate to the Company in writing. Any
notice shall be delivered by hand, sent by telecopy or enclosed in a properly
sealed envelope addressed as stated above, registered and deposited, postage
prepaid, in a post office regularly maintained by the United States Postal
Service.

14. Counterparts. This Agreement may be signed in any number of counterparts and
by facsimile signature, each of which shall be deemed to be an original, and all
of which taken together shall be deemed to be one and the same instrument.

15. Complete Understanding. This Agreement, together with the Plan,
contains the entire agreement of the parties relating to the subject matter
hereof and supersedes all prior agreements and understanding with respect to
such subject matter, and the parties hereto have made no agreements,
representations or warranties relating to the subject matter of this Agreement
which are not set forth herein, provided that the Parties are parties to the
Employment Agreement. Nothing contained in this Agreement shall be construed to
limit or affect in any manner or to any extent the restrictions or prohibitions
that are applicable to the Grantee under the Employment Agreement or the
duration thereof. Similarly, except as expressly provided otherwise in this
Agreement, nothing contained in the Employment Agreement shall be construed to
limit or affect in any manner or to any extent the restrictions or prohibitions
that are applicable to the Grantee under this Agreement.

                            [Signature Page Follows]


                                       6
<PAGE>

      IN WITNESS WHEREOF, the Company has caused a duly authorized officer to
execute this Agreement, and the Grantee has executed this Agreement, effective
as of the Date of Grant.

THE COMPANY:                              GRANTEE:

DYADIC INTERNATIONAL, INC.

By:   _____________                       Accepted:   _____________________
      President                                       Ratnesh (Ray) Chandra


                                       7
<PAGE>

                                    EXHIBIT B
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                              RATNESH (RAY) CHANDRA

                             TERMINATION CERTIFICATE

      This is to certify that, except as permitted by the Employment Agreement
(as defined below) I do not have in my possession, nor have I failed to return,
any software, inventions, designs, works of authorship, copyrightable works,
formulas, data, marketing plans, forecasts, product concepts, marketing plans,
strategies, forecasts, devices, records, data, notes, reports, proposals,
customer lists, correspondence, specifications, drawings, blueprints, sketches,
materials, patent applications, continuation applications, continuation-in-part
applications, divisional applications, other documents or property, or
reproductions of any aforementioned items belonging to DYADIC INTERNATIONAL,
INC. (the "Company"), its Subsidiaries and their Affiliates, successors or
assigns.

      I further certify that I have complied with all the terms of the
Employment Agreement dated as of March 30, 2005 between the Company and me (as
the same may be amended, restated or otherwise modified, the "Employment
Agreement"), relating to the reporting of any Work Product conceived or made by
me (solely or jointly with others) covered by the Employment Agreement.
Capitalized terms used but not otherwise defined herein shall have the meanings
given such terms in the Employment Agreement.

      I acknowledge that the provisions of the Employment Agreement relating to
Confidential Information continue in effect beyond the termination of the
Employment Agreement, as set forth therein.

      Finally, I further acknowledge that the provisions of the Employment
Agreement relating to my (i) anti-pirating, (ii) non-interference and (iii)
non-competition covenants to the Company, its Subsidiaries and their Affiliates,
also remain in effect following the date of my termination of employment with
the Company.

Date:____________                   ______________________________
                                    Executive


                                       8
<PAGE>

                                    EXHIBIT C
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                              RATNESH (RAY) CHANDRA

                                 GENERAL RELEASE

      I, Ratnesh (Ray) Chandra, in consideration of and subject to the
performance by DYADIC INTERNATIONAL, INC., a Delaware corporation (the
"Company"), of its material obligations under the Employment Agreement, dated as
of March 30, 2005 (as the same may be amended, restated or otherwise modified,
the "Agreement"), do hereby release and forever discharge as of the date hereof
the Company, its Subsidiaries and their Affiliates (as those terms are defined
in the Agreement) and all present and former directors, officers, agents,
representatives, employees, successors and assigns of the Company, its
Subsidiaries and their Affiliates and their direct or indirect owners
(collectively, the "Released Parties") to the extent provided below.

1.    I understand  that any payments or benefits  paid or granted to me under
      Section 5.2(c) of the Agreement  represent,  in part,  consideration for
      signing  this General  Release and are not salary,  wages or benefits to
      which I was already  entitled.  I  understand  and agree that I will not
      receive the  payments and  benefits  specified in Section  5.2(c) of the
      Agreement  unless I execute this General  Release and do not revoke this
      General  Release  within the time period  permitted  hereafter or breach
      this General Release.

2.    Except as provided in paragraph 4 of this General  Release,  I knowingly
      and voluntarily  release and forever discharge the Company and the other
      Released  Parties  from  any and  all  claims,  controversies,  actions,
      causes  of  action,   cross-claims,   counterclaims,   demands,   debts,
      compensatory   damages,   liquidated  damages,   punitive  or  exemplary
      damages,  other  damages,  claims  for costs  and  attorneys'  fees,  or
      liabilities  of any nature  whatsoever  in law and in equity,  both past
      and  present  (through  the date of this  General  Release)  and whether
      known or unknown,  suspected,  or claimed  against the Company or any of
      the Released Parties which I, my spouse, or any of my heirs,  executors,
      administrators  or  assigns,  may  have,  which  arise  out  of  or  are
      connected  with my employment  with, or my separation  from, the Company
      (including,  but not limited  to, any  allegation,  claim or  violation,
      arising  under:  Title VII of the Civil Rights Act of 1964,  as amended;
      the Civil Rights Act of 1991; the Age  Discrimination  in Employment Act
      of 1967,  as amended  (including  the Older Workers  Benefit  Protection
      Act);  the  Equal  Pay Act of  1963,  as  amended;  the  Americans  with
      Disabilities  Act of 1990; the Family and Medical Leave Act of 1993; the
      Civil Rights Act of 1866, as amended;  the Worker Adjustment  Retraining
      and Notification  Act; the Executive  Retirement  Income Security Act of
      1974; any applicable Executive Order Programs;  the Fair Labor Standards
      Act; or their state or local  counterparts;  or under any other federal,
      state or local  civil or human  rights  law,  or under any other  local,
      state,  or federal law,  regulation  or  ordinance;  or under any public
      policy,  contract or tort,  or under  common  law; or arising  under any

<PAGE>

      policies,  practices  or  procedures  of the  Company;  or any claim for
      wrongful  discharge,  breach  of  contract,   negligent  or  intentional
      infliction of emotional  distress,  defamation;  or any claim for costs,
      fees, or other  expenses,  including  attorneys'  fees incurred in these
      matters)  (all of the foregoing  collectively  referred to herein as the
      "Claims").

3.    I represent that I have made no assignment or transfer of any right,
      claim, demand, cause of action, or other matter covered by paragraph 2 of
      this General Release.

4.    I and the Company  mutually  agree that this  General  Release  does not
      waive or release  any rights or claims  that I may have  under:  (a) the
      Age  Discrimination in Employment Act of 1967 which arise after the date
      I execute this General  Release;  and (b) any  agreements to which I and
      the Company  and/or any of its  Subsidiaries  or Affiliates  are parties
      pertaining to any shares or options to purchase  shares of capital stock
      of the Company  and/or any of its  Subsidiaries  or Affiliates  owned by
      me. I acknowledge  and agree that my separation from employment with the
      Company in compliance  with the terms of the  Agreement  shall not serve
      as the basis for any claim or  action  (including,  without  limitation,
      any claim under the Age Discrimination in Employment Act of 1967).

5.    In signing this General Release,  I acknowledge and intend that it shall
      be  effective  as a bar to each and every one of the Claims  hereinabove
      mentioned or implied.  I expressly  consent  that this  General  Release
      shall be given full force and  effect  according  to each and all of its
      express terms and  provisions,  including  those relating to unknown and
      unsuspected  Claims  (notwithstanding  any state statute that  expressly
      limits the  effectiveness  of a general release of unknown,  unsuspected
      and  unanticipated  Claims),  if any,  as well as those  relating to any
      other Claims  hereinabove  mentioned or implied. I acknowledge and agree
      that this  waiver is an  essential  and  material  term of this  General
      Release and that without  such waiver the Company  would not have agreed
      to the  terms of the  Agreement.  I  further  agree  that in the event I
      should bring a Claim seeking  damages  against any Released Party, or in
      the event I should  seek to recover  against any  Released  Party in any
      Claim  brought  by a  governmental  agency on my  behalf,  this  General
      Release  shall  serve as a complete  defense to such  Claims.  I further
      agree  that I am not aware of any  pending  charge or  complaint  of the
      type  described  in  paragraph  2 as of the  execution  of this  General
      Release.

6.    I agree that neither this General Release, nor the furnishing of the
      consideration for this General Release, shall be deemed or construed at
      any time to be an admission by the Company, any Released Party or myself
      of any improper or unlawful conduct.

7.    I agree that if I challenge  the  validity of this  General  Release,  I
      will  forfeit  all  unpaid  amounts  otherwise  payable  by the  Company
      pursuant to Section  5.2(c) of the  Agreement  other than the very first
      payment due me  thereunder,  provided that nothing  herein  contained in
      this Agreement shall prohibit or bar me from filing a charge,  including

                                       2
<PAGE>

      a challenge to the  validity of the  Agreement,  with the United  States
      Equal Employment  Opportunity Commission ("EEOC"), or any state or local
      fair  employment   practices  agency,  or  from   participating  in  any
      investigation,  hearing  or  proceeding  conducted  by the EEOC,  or any
      state or local fair employment  practices agency. I also agree that if I
      violate this General  Release by suing the Company or the other Released
      Parties,  I will pay all costs and  expenses  of  defending  against the
      suit incurred by the Released Parties,  including reasonable  attorneys'
      fees, and return all payments received by me pursuant to the Agreement.

8.    I agree that this General Release is confidential and agree not to
      disclose any information regarding the terms of this General Release,
      except to my immediate family and any tax, legal or other counsel I have
      consulted regarding the meaning or effect hereof or as required by law,
      and I will instruct each of the foregoing not to disclose the same to
      anyone.

9.    Any non-disclosure provision in this General Release does not prohibit or
      restrict me (or my attorney) from responding to any inquiry about this
      General Release or its underlying facts and circumstances by the
      Securities and Exchange Commission (SEC), the EEOC (or a state or local
      fair employment practices agency), the National Association of Securities
      Dealers, Inc. (NASD), any other self-regulatory organization or
      governmental entity.

10.   I agree  to  reasonably  cooperate  with  the  Company  in any  internal
      investigation or administrative,  regulatory,  or judicial proceeding. I
      understand  and  agree  that  my  cooperation  may  include,  but not be
      limited to,  making  myself  available  to the Company  upon  reasonable
      notice for  interviews  and  factual  investigations;  appearing  at the
      Company's  request  to give  testimony  without  requiring  service of a
      subpoena or other legal process;  volunteering to the Company  pertinent
      information;  and turning  over to the Company  all  relevant  documents
      which are or may come into my  possession  all at times and on schedules
      that are reasonably  consistent with my other  permitted  activities and
      commitments,  provided  that I shall have no  obligation  to expend more
      than one week of my time in  connection  with the  performance  of these
      activities which out reasonable  recompense,  as mutually and reasonably
      agreed upon by me and the Company.  I  understand  that in the event the
      Company asks for my cooperation in accordance with this  provision,  the
      Company  will  reimburse  me  solely  for  reasonable  travel  expenses,
      including lodging and meals, upon my submission of receipts.

11.   Notwithstanding anything in this General Release to the contrary, this
      General Release shall not relinquish, diminish, or in any way affect any
      rights or claims arising out of any breach by the Company or by any
      Released Party of the Agreement.

12.   Whenever  possible,  each  provision  of this General  Release  shall be
      interpreted  in,  such  manner  as  to  be  effective  and  valid  under
      applicable  law, but if any provision of this General Release is held to
      be  invalid,   illegal  or   unenforceable  in  any  respect  under  any
      applicable law or rule in any jurisdiction, such invalidity,  illegality
      or  unenforceability  shall not affect any other  provision or any other
      jurisdiction,  but this General Release shall be reformed, construed and
      enforced  in  such   jurisdiction   as  if  such  invalid,   illegal  or
      unenforceable provision had never been contained herein.

                                       3
<PAGE>

BY SIGNING THIS GENERAL RELEASE, I REPRESENT AND AGREE THAT:

(a)   I HAVE READ IT CAREFULLY;

(b)   I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT
      RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION
      IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT
      OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH
      DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
      OF 1974, AS AMENDED;

(c)   I VOLUNTARILY CONSENT TO EVERYTHING IN IT;

(d)   I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I
      HAVE DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION I HAVE CHOSEN NOT
      TO DO SO OF MY OWN VOLITION;

(e)   I HAVE HAD AT LEAST 21 DAYS FROM THE DATE OF MY RECEIPT OF THIS RELEASE
      SUBSTANTIALLY IN ITS FINAL FORM ON _______________ ____, ____ TO CONSIDER
      IT AND THE CHANGES MADE SINCE THE ______________ _____, _____VERSION OF
      THIS RELEASE ARE NOT MATERIAL AND WILL NOT RESTART THE REQUIRED 21-DAY
      PERIOD;

(f)   THE CHANGES TO THE AGREEMENT SINCE ____________ ___, _____ EITHER ARE NOT
      MATERIAL OR WERE MADE AT MY REQUEST.

(g)   I UNDERSTAND THAT I HAVE SEVEN DAYS AFTER THE EXECUTION OF THIS RELEASE TO
      REVOKE IT AND THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE
      UNTIL THE REVOCATION PERIOD HAS EXPIRED;

(h)   I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE
      ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND


                                       4
<PAGE>

(i)   I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED,
      WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY
      AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME.

DATE:                                     _____________________


                                       5

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.4
<SEQUENCE>5
<FILENAME>ex99-4.txt
<TEXT>
                         EXECUTIVE EMPLOYMENT AGREEMENT

      THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made and entered into
as of the 30th day of March, 2005, by and between DYADIC INTERNATIONAL, INC., a
Delaware corporation (the "Company"), and Alexander (Sasha) Bondar (the
"Executive"). The Company and the Executive are sometimes hereinafter
collectively referred to as the "parties" and individually as a "party,"
provided that as applicable, any reference to the Company shall mean the
Company, its Subsidiaries and and\or their Affiliates, as the case may be.
Certain capitalized terms used in this Agreement are defined in Article VII
hereof.

                                    RECITALS

      A. The Executive is currently employed by the Company as the Company's
Executive Director, Business Development. The Compensation Committee of the
Board of Directors ("Board") of the Company (the "Compensation Committee")
recently reviewed the Executive's job performance in calendar year 2004, and
made a number of favorable determinations regarding Executive's job performance.

      B. The Company maintains the "Dyadic International, Inc. 2001 Equity
Compensation Plan" (as the same may be amended, restated or otherwise modified,
the "Equity Compensation Plan") pursuant to which the Company is authorized to
grant stock options to purchase shares of Common Stock of the Company ("Shares")
to employees, officers, directors, consultants and advisors of the Company and
its Subsidiaries.

      C. Among the determinations of the Compensation Committee were that,
subject to the satisfaction of the condition set forth in Recital D hereof, it
would be in the best interests of the Company to: (i) promote the Executive to
the position of Vice President, Strategy & Corporate Development, increase the
Executive's annual base compensation and confer upon the Executive the benefits
of certain post-employment severance benefits provided for in this Agreement;
and (ii) incentivize and reward the Executive's efforts, loyalty and commitment
to the Company, by granting to the Executive a certain stock option to purchase
Shares (the "Option") under and pursuant to the terms of the Equity Compensation
Plan and a Stock Option Agreement in the form of Exhibit A attached hereto and
by this reference made a part hereof (the "Stock Option Agreement").

      D. As a condition of that promotion, and as partial consideration for that
salary increase and the grant of the Option, the Company requires that this
Agreement be entered into pursuant to which the Executive is hereby knowingly
and intentionally furnishing the Company with, among other things, the suite of
proprietary covenants of the Executive in favor of the Company set forth in
Article IV hereof, including by way of illustration, and not in limitation, the
Executive's covenant not to compete with the businesses of the Company, its
Subsidiaries and their Affiliates.

      E. The Executive desires to be promoted to the position of Vice President,
Strategy & Corporate Development, to receive the salary increase and other
financial benefits of this Agreement and the grant of the Option. Further, the
Executive expressly acknowledges that: (i) as a member of the Company's
management, he is one of the persons charged with primary responsibility for the
implementation of the Company's business plans, and that he will have regular
<PAGE>

access to various confidential and/or proprietary information relating to the
Company, its Subsidiaries, their Affiliates and their businesses; and (ii) the
suite of proprietary covenants of the Executive in favor of the Company set
forth in Article IV hereof which the Executive is knowingly and intentionally
furnishing to the Company, including by way of illustration, and not in
limitation, the Executive's covenant not to engage in competition with the
Company, its Subsidiaries, their Affiliates and their businesses, are (A) being
made both in consideration of the Company's promotion, increase in the annual
base salary of and the grant of the Option to the Executive and (B) necessary to
protect the legitimate business interests of the Company, its Subsidiaries and
Affiliates and their respective businesses.

                                    AGREEMENT

      NOW, THEREFORE, in consideration of the foregoing recitals, and the mutual
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby mutually acknowledged, the parties
hereby agree as follows:

                                    ARTICLE I
                             EMPLOYMENT RELATIONSHIP

      1.1   Recitals.  The Recitals to this Agreement are hereby  incorporated
herein and made a part hereof.

      1.2 Employment. Subject to the terms and conditions of this Agreement, the
Company hereby agrees to employ the Executive to serve as the Company's Vice
President, Strategy & Corporate Development with his primary responsibility
being in the areas of corporate development (including developing and managing
strategic interactions with the developing South Florida Biotechnology cluster
and such other new business formations and joint ventures as may be assigned to
him), organization planning, merger & acquisition opportunities, fund-raising
activities and investor and public relations, and secondarily, when requested,
to assist in business development for the Company's biosciences and enzymes
businesses, and the Executive hereby accepts such employment, and agrees to
perform all of his assigned duties and responsibilities to the best of his
abilities in a diligent, trustworthy, businesslike and efficient manner, and in
compliance with the Dyadic International, Inc. Code of Business Conduct and
Ethics, a copy of which appears on the Company's website.

      1.3 Duties; Reporting Authority. The Executive shall have the normal and
customary duties, responsibilities and authority of a Person holding the title
and job description set forth in Section 1.2 hereof, and in addition, shall
perform such other duties on behalf of the Company, its Subsidiaries and their
Affiliates as may be assigned to him by the Chief Executive Officer, the Chief
Operating Officer or President of the Company, or by the Board. In connection
with the Executive's performance of his duties he shall report to the Chief
Executive Officer, the Chief Operating Officer or President of the Company or to
such other Person as the Chief Executive Officer, Chief Operating Officer or
President of the Company or the Board may designate from time to time.

      1.4 Exclusive Employment. While he is employed by the Company hereunder,
the Executive covenants to the Company that he will devote his entire business
time, energy, attention and skill to the Company, its Subsidiaries and their

                                       2
<PAGE>

Affiliates (except for permitted vacation periods and reasonable periods of
illness or other incapacity), and use his good faith best efforts to promote the
interests of the Company, its Subsidiaries and their Affiliates. The foregoing
shall not be construed as prohibiting the Executive from spending such time as
may be reasonably necessary to attend to his personal affairs and investments so
long as such activities do not conflict or interfere with the Executive's
obligations and\or timely performance of his duties to the Company, its
Subsidiaries and their Affiliates hereunder.

      1.5 Executive Representations. The Executive hereby represents and
warrants to the Company that:

            (a) the execution, delivery and performance by the Executive of this
      Agreement and any other agreements contemplated hereby to which the
      Executive is a party do not and shall not conflict with, breach, violate
      or cause a default under any contract, agreement, instrument, order,
      judgment or decree to which the Executive is a party or by which he is
      bound;

            (b) the Executive is not a party to or bound by any employment
      agreement, non-competition agreement or confidentiality agreement with any
      other Person (or if a party to such an agreement, the Executive has
      disclosed the material terms thereof to the Compensation Committee prior
      to the execution hereof and promptly after the date hereof shall deliver a
      copy of such agreement to the Compensation Committee); and

            (c) upon the execution and delivery of this Agreement by the
      Company, this Agreement shall be the valid and binding obligation of the
      Executive, enforceable in accordance with its terms.

The Executive hereby acknowledges and represents that he has consulted with
independent legal counsel regarding his rights and obligations under this
Agreement and that he fully understands the terms and conditions contained
herein.

      1.6   Company   Representations.   The  Company  hereby  represents  and
warrants to the Executive that:

            (a) the execution, delivery and performance by the Company of this
      Agreement and any other agreements contemplated hereby to which the
      Company is a party do not and shall not conflict with, breach, violate or
      cause a default under any contract, agreement, instrument, order, judgment
      or decree to which the Company is a party or by which he is bound; and

            (b) upon the execution and delivery of this Agreement by the
      Executive, this Agreement shall be the valid and binding obligation of the
      Company, enforceable in accordance with its terms.

      1.7   Indemnification.

                                       3
<PAGE>

            (a) By the Executive. The Executive shall indemnify and hold the
      Company and its Subsidiaries and Affiliates harmless from and against any
      and all claims, demands, losses, judgments, costs, expenses, or
      liabilities incurred by the Company and/or any of its Subsidiaries or
      Affiliates arising out of or in connection with the breach of any
      representation or warranty of the Executive contained in this Agreement.

            (b) By the Company. The Company shall indemnify and hold the
      Executive harmless from and against any and all claims, demands, losses,
      judgments, costs, expenses, or liabilities incurred by the Executive
      arising out of or in connection with the breach of any representation or
      warranty of the Company contained in this Agreement. Further, the Company
      shall defend, indemnify and hold harmless the Executive (including without
      limitation, the prompt advance payment of all reasonable legal fees and
      expenses) to the fullest extent permitted by applicable law and the
      by-laws of the Company.

                                   ARTICLE II
                              PERIOD OF EMPLOYMENT

      2.1 Employment Period. The Executive is an existing employee of the
Company and shall continue to be an employee of the Company until the date fixed
by the provisions of Section 2.2 hereof, subject to the early termination
provisions of Article V hereof (the "Employment Period"), it being acknowledged
that the Company's fiscal year ends on December 31, and that the Employment
Period shall therefore be denominated in calendar years.

      2.2 Initial Term of Employment Period and Extension Terms. The Employment
Period shall initially continue until December 31, 2007 (the "Initial Term").
The Employment Period shall be automatically extended for successive calendar
years of the Company following the expiration of the Initial Term (each such one
year period being hereinafter referred to as an "Extension Term") upon the same
terms and conditions provided for herein unless either party provides the other
party with advance written notice of its or his intention not to extend the
Employment Period; provided, however, that such notice must be delivered by the
non-extending party to the other party not later than ninety (90) days prior to
the expiration of the Initial Term or any Extension Term, as the case may be.

                                   ARTICLE III
                                  COMPENSATION

      3.1 Annual Base Compensation. Effective as of April 1, 2005, and during
the balance of the Employment Period the Company shall pay to the Executive an
annual base salary (the "Annual Base Compensation") in the amount of $143,000,
provided that the Annual Base Compensation the Employee had been being paid
prior to the date of this Agreement shall remain in effect until April 1, 2005.
The Annual Base Compensation shall be paid in regular installments in accordance
with the Company's general payroll practices, and shall be subject to all
required federal, state and local withholding taxes. The Executive's Annual Base
Compensation shall be reviewed by the Chief Executive Officer and the
Compensation Committee of the Board (the "Compensation Committee") annually, and
may, in the discretion of the Chief Executive Officer and the Compensation
Committee be increased, provided that there shall be no obligation on the part
of the Company to increase the Executive's Annual Base Compensation.

                                       4
<PAGE>

      3.2 Potential Annual Target Bonuses. In respect of each calendar year
falling within the Employment Period, the Executive shall be eligible to earn an
annual bonus, depending upon the results of operation of the Company, its
Subsidiaries and their Affiliates and the personal performance of the Executive,
of up to forty percent (40%) of the Executive's Annual Base Compensation for
that calendar year (the "Potential Annual Target Bonus") in accordance with the
terms of a bonus plan which shall be adopted and maintained in effect by the
Compensation Committee for that calendar year. The amount of the Potential
Annual Target Bonus, if any, which is earned by the Executive (the "Bonusable
Amount") shall be paid by the Company to the Executive following the close of
the Company's calendar year consistent with the timing of similar bonus payments
being made to other executives of the Company for such year, provided that,
unless expressly provided otherwise herein, it shall be a condition precedent to
the Executive's right to receive any Bonusable Amount that the Executive be
employed by the Company on the last day of that calendar year, regardless of any
subsequent termination of employment. In the absolute discretion of the
Compensation Committee, the Executive may be entitled to receive an additional
bonus, as and if the Compensation Committee shall determine from time to time.

      3.3 Expenses. During the Employment Period, the Executive shall be
entitled to reimbursement of all travel, entertainment and other business
expenses reasonably incurred in the performance of his duties for the Company,
upon submission of all receipts and accounts with respect thereto, and approval
by the Company thereof, in accordance with the business expense reimbursement
policies adopted by the Company from time to time.

      3.4 Vacation. In respect of each calendar year falling within the
Employment Period, the Executive shall be entitled to four (4) weeks of
vacation, or if greater, the number of weeks of vacation proscribed by the
vacation policies of the Company then in effect from time to time, provided that
unused vacation may be used by the Executive in the following calendar year only
in accordance with and as permitted by the Company's then current vacation
policies in effect from time to time.

      3.5 Other Fringe Benefits. During the Employment Period, if, as and when
they are being provided to other employees of the Company holding positions with
the Company comparable to the Executive's position, the Executive shall also be
entitled to receive health insurance benefits, disability benefits and
retirement benefits and other fringe benefits.

      3.6 Grant of Stock Option. In part as recompense for his job performance
in 2004 and in part as additional consideration for the Executive's execution
and delivery of this Agreement, conferral upon the Company of the covenants set
forth in Article IV hereof, and the Executive's performance of his duties
hereunder, concurrently with the execution and delivery of this Agreement, the
parties are executing and delivering the Option Agreement pursuant to which the
Company has granted to the Executive an Option to purchase thirty five thousand
(35,000) Shares for a per Share purchase price of equal to the mean of the final
"asked" and "bid" prices of the Shares on the date hereof, in accordance with
the provisions of the Equity Compensation Plan.

                                       5
<PAGE>

                                   ARTICLE IV
                            COVENANTS OF THE EMPLOYEE

      4.1 Proprietary Rights. The Executive hereby expressly agrees that all
research, Biological Materials, discoveries, inventions and innovations (whether
or not reduced to practice or documented), improvements, developments, methods,
designs, analyses, drawings, reports and all similar or related information
(whether patentable or unpatentable, and whether or not reduced to writing),
trade secrets (being information about the business of the Company, its
Subsidiaries and their Affiliates which is considered by the Company or any such
Subsidiary or Affiliate to be confidential and is proprietary to the Company or
any such Subsidiary or Affiliate) and confidential information, copyrightable
works, and similar and related information (in whatever form or medium), which
(x) either (i) relate to the Company's, its Subsidiaries' or their Affiliates'
actual or anticipated business, research and development or existing or future
products or services or (ii) result from any work performed by the Executive for
the Company, its Subsidiaries or any of their Affiliates and (y) are conceived,
developed, made or contributed to in whole or in part by the Executive during
the Employment Period ("Work Product") shall be and remain the sole and
exclusive property of the Company, such Subsidiary or such Affiliate, as the
case may be. The Executive shall communicate promptly and fully all Work Product
to the Company.

            (a) Work Made for Hire. The Executive acknowledges that, unless
      otherwise agreed in writing by the Company, all Work Product eligible for
      any form of copyright protection made or contributed to in whole or in
      part by the Executive within the scope of the Executive's employment by
      the Company during the Employment Period shall be deemed a "work made for
      hire" under the copyright laws and shall be owned by the Company, its
      Subsidiaries or their Affiliates, as applicable.

            (b) Assignment of Proprietary Rights. The Executive hereby assigns,
      transfers and conveys to the Company, and shall assign, transfer and
      convey to the Company, all right, title and interest in and to all
      inventions, ideas, improvements, designs, processes, trademarks, service
      marks, trade names, trade secrets, trade dress, data, discoveries and
      other proprietary assets and proprietary rights in and of the Work Product
      (the "Proprietary Rights") for the Company's exclusive ownership and use,
      together with all rights to sue and recover for past and future
      infringement or misappropriation thereof, provided that if a Subsidiary or
      Affiliate of the Company is the owner thereof, such assignment, transfer
      and conveyance shall be made to such Subsidiary or Affiliate, , as the
      case may be, which shall enjoy exclusive ownership and use, together with
      all rights to sue and recover for past and future infringement or
      misappropriation thereof.

            (c) Further Instruments. At the request of the Company (its
      Subsidiaries or their Affiliates, as the case may be), at all times during
      the Employment Period and thereafter, the Executive will promptly and
      fully assist the Company (its Subsidiaries or their Affiliates, as the
      case may be) in effecting the purpose of the foregoing assignment,
      including but not limited to the further acts of executing any and all
      documents necessary to secure for the Company (its Subsidiaries or their
      Affiliates, as the case may be) such Proprietary Rights and other rights
      to all Work Product and all confidential information related thereto,
      providing cooperation and giving testimony.

                                       6
<PAGE>

            (d) Inapplicability of Section 4.1 In Certain Circumstances. The
      Company expressly acknowledges and agrees that, and the Executive is
      hereby advised that, this Section 4.1 does not apply to any invention for
      which no equipment, supplies, facilities or trade secret information of
      the Company, its Subsidiaries or any of their Affiliates was used and
      which was developed entirely on the Executive's own time, unless (i) the
      invention relates to the business of the Company, its Subsidiaries or any
      of their Affiliates or to the Company's, its Subsidiaries' or any of their
      Affiliates' actual or demonstrably anticipated research or development or
      (ii) the invention results from any work performed by the Executive for
      the Company, its Subsidiaries or any of their Affiliates.

      4.2 Ownership and Covenant to Return Documents, etc. The Executive agrees
that all Work Product and all documents or other tangible materials (whether
originals, copies or abstracts), including without limitation, price lists,
quotation guides, outstanding quotations, books, records, manuals, files, sales
literature, training materials, customer records, correspondence, computer disks
or print-out documents, contracts, orders, messages, phone and address lists,
invoices and receipts, and all objects associated therewith, which in any way
relate to the business or affairs of the Company, its Subsidiaries and their
Affiliates either furnished to the Executive by the Company, its Subsidiaries or
any of their Affiliates or are prepared, compiled or otherwise acquired by the
Executive during the Employment Period, shall be the sole and exclusive property
of the Company, such Subsidiaries or such Affiliates, as the case may be. The
Executive shall not, except for the use of the Company, its Subsidiaries or any
of their Affiliates, use, copy or duplicate any of the aforementioned documents
or objects, nor remove them from the facilities of the Company or such
Subsidiaries or such Affiliates, , as the case may be, nor use any information
concerning them except for the benefit of the Company, its Subsidiaries and
their Affiliates, either during the Employment Period or thereafter. The
Executive agrees that he will deliver all of the aforementioned documents and
objects that may be in his possession to the Company on the termination of his
employment with the Company, or at any other time upon the Company's request,
together with his written certification of compliance with the provisions of
this Section 4.2 in the form of Exhibit B to this Agreement in accordance with
the provisions of Section 5.3 hereof.

      4.3 Non-Disclosure Covenant. For a period commencing on the date of this
Agreement and ending on the last to occur of five (5) years following the date
of execution of this Agreement or three (3) years following the date of the
termination of the Employment Period (the "Non-Disclosure Period"), the
Executive shall not, either directly or indirectly, disclose to any
"unauthorized person" or use for the benefit of the Executive or any Person
other than the Company, its Subsidiaries or their Affiliates any Work Product or
any knowledge or information which the Executive may acquire while employed by
the Company (whether before or after the date of this Agreement) relating to (i)
the financial, marketing, sales and business plans and affairs, financial
statements, analyses, forecasts and projections, books, accounts, records,
operating costs and expenses and other financial information of the Company, its
Subsidiaries and their Affiliates, (ii) internal management tools and systems,

                                       7
<PAGE>

costing policies and methods, pricing policies and methods and other methods of
doing business, of the Company, its Subsidiaries and their Affiliates, (iii)
customers, sales, customer requirements and usages, distributor lists, of the
Company, its Subsidiaries and their Affiliates, (iv) agreements with customers,
vendors, independent contractors, employees and others, of the Company, its
Subsidiaries and their Affiliates, (v) existing and future products or services
and product development plans, designs, analyses and reports, of the Company,
its Subsidiaries and their Affiliates, (vi) computer software and data bases
developed for the Company, its Subsidiaries or their Affiliates, trade secrets,
research, records of research, models, designs, drawings, technical data and
reports of the Company, its Subsidiaries and their Affiliates and (vii)
correspondence or other private or confidential matters, information or data
whether written, oral or electronic, which is proprietary to the Company, its
Subsidiaries and their Affiliates and not generally known to the public
(individually and collectively "Confidential Information"), without the
Company's prior written permission. For purposes of this Section 4.3, the term
"unauthorized person" shall mean any Person who is not (i) an officer or
director of the Company or an employee of the Company for whom the disclosure of
the knowledge or information referred to herein is necessary for his performance
of his assigned duties, or (ii) an employee, officer or director of a Subsidiary
or Affiliate of the Company for whom the disclosure of the knowledge or
information referred to herein is necessary for his performance of his assigned
duties, or (iii) a Person expressly authorized by the Company to receive
disclosure of such knowledge or information. The Company expressly acknowledges
and agrees that the term "Confidential Information" excludes information which
is (A) in the public domain or otherwise generally known to the trade, or (B)
disclosed to third parties other than by reason of the Executive's breach of his
confidentiality obligation hereunder or (C) learned of by the Executive
subsequent to the termination of his employment hereunder from any other party
not then under an obligation of confidentiality to the Company, its Subsidiaries
and their Affiliates. Further, the Executive covenants to the Company that in
the Executive's performance of his duties hereunder, the Executive will violate
no confidentiality obligations he may have to any third Persons.

      4.4 Non-Interference Covenants. The Executive covenants to the Company
that while the Executive is employed by the Company hereunder and for the two
(2) year period thereafter (the "Non-Interference Period"), he will not, for any
reason, directly or indirectly: (a) solicit, hire, or otherwise do any act or
thing which may induce any other employee of the Company, its Subsidiaries or
their Affiliates to leave the employ or otherwise interfere with or adversely
affect the relationship (contractual or otherwise) of the Company, its
Subsidiaries and their Affiliates with any person who is then or thereafter
becomes an employee of the Company, its Subsidiaries and their Affiliates; (b)
do any act or thing which may interfere with or adversely affect the
relationship (contractual or otherwise) of the Company, its Subsidiaries and
their Affiliates with any vendor of goods or services to the Company, its
Subsidiaries and their Affiliates or induce any such vendor to cease doing
business with the Company, its Subsidiaries and their Affiliates; or (c) except
for Competitive Activities (as defined in Section 4.5) engaged in by the
Employee after the expiration of the Non-Competition Period, do any act or thing
which may interfere with or adversely affect the relationship (contractual or
otherwise) of the Company, its Subsidiaries and their Affiliates with any
customer of the Company, its Subsidiaries and their Affiliates or induce any
such customer to cease doing business with the Company, its Subsidiaries and
their Affiliates.

      4.5 Covenant Not To Compete. The Executive expressly acknowledges that (i)
the Executive's performance of his services for the Company hereunder will
afford him or her access to and cause him or her to become highly knowledgeable
about the Company's, its Subsidiaries' and their Affiliates' Confidential
Information; (ii) the agreements and covenants contained in this Section 4.5 are
essential to protect the Confidential Information, business and goodwill of the
Company, its Subsidiaries and their Affiliates, and the restraints on the

                                       8
<PAGE>

Executive imposed by the provisions of this Section 4.5 are justified by these
legitimate business interests of the Company; and (iii) his covenants to the
Company, its Subsidiaries and their Affiliates set forth in this Section 4.5 are
being made both in consideration of the Company's employment of the Executive in
the office to which the Executive has been promoted, the salary increase and
other financial benefits of this Agreement and the grant of the Option.
Accordingly, the Executive hereby agrees that during the Non-Competition Period
he shall not, anywhere in the Applicable Territory, directly or indirectly, own
any interest in, invest in, lend to, borrow from, manage, control, participate
in, consult with, become employed by, render services to, or in any other manner
whatsoever engage in, any business which is competitive with any lines of
business actively being engaged in by the Company, its Subsidiaries and their
Affiliates in the Applicable Territory or actively (and demonstrably) being
considered by the Company, its Subsidiaries and their Affiliates for entry into
on the date of the termination of the Employment Period (collectively,
"Competitive Activities"). The preceding to the contrary notwithstanding, the
Executive shall be free to make investments in the publicly traded securities of
any corporation, provided that such investments do not amount to more than 1% of
the outstanding securities of any class of such corporation.

      4.6 Remedies For Breach. If the Executive commits a breach, or threatens
to commit a breach, of any of the provisions of this Article IV, the Company and
its Subsidiaries shall have the right and remedy, in addition to any other
remedy that may be available at law or in equity, to have the provisions of this
Article IV specifically enforced by any court having equity jurisdiction, by the
entry of temporary, preliminary and permanent injunctions and orders of specific
performance, together with an accounting therefor, it being expressly
acknowledged and agreed by the Executive that any such breach or threatened
breach will cause irreparable injury to the Company and its Subsidiaries and
that money damages will not provide an adequate remedy to the Company and its
Subsidiaries. Any such injunction shall be available without the posting of any
bond or other security, and the Executive hereby consents to the issuance of
such injunction. The Executive further agrees that any such injunctive relief
obtained by the Company or its Subsidiaries shall be in addition to, and not in
lieu of, monetary damages and any other remedies to which the Company or its
Subsidiaries may be entitled. Further, in the event of an alleged breach or
violation by the Executive of any of the provisions of Sections 4.3, 4.4 or 4.5
hereof, the Non-Disclosure Period, the Non-Interference Period and\or the
Non-Competition Period, as the case may be, shall be tolled until such breach or
violation has been cured. The parties agree that in the event of the institution
of any action at law or in equity by either party to enforce the provisions of
this Article IV, the losing party shall pay all of the costs and expenses of the
prevailing party, including reasonable legal fees, incurred in connection
therewith. If any covenant contained in this Article IV or any part thereof is
hereafter construed to be invalid or unenforceable, the same shall not affect
the remainder of such covenant or any other covenants, which shall be given full
effect, without regard to the invalid portions, and any court having
jurisdiction shall have the power to modify such covenant to the least extent
necessary to render it enforceable and, in its modified form, said covenant
shall then be enforceable.

                                       9
<PAGE>

                                    ARTICLE V
                            TERMINATION OF EMPLOYMENT

      5.1 Termination and Triggering Events. Notwithstanding anything to the
contrary elsewhere contained in this Agreement, the Employment Period shall
terminate at the expiration of the Initial Term or any Extension Term, or prior
to the expiration of the Initial Term or any Extension Term upon the occurrence
of any of the following events (hereinafter referred to as "Triggering Events"):
(a) the Executive's death; (b) the Executive's Total Disability; (c) the
Executive's Resignation; (d) a Termination by the Company for Cause; or (f) a
Termination by the Company Without Cause.

      5.2 Rights Upon Occurrence of a Triggering Event. Subject to the
provisions of Section 5.3 hereof, the rights of the parties upon the occurrence
of a Triggering Event prior to the expiration of the Initial Term or any
Extension Term shall be as follows:

            (a) Resignation and Termination by the Company for Cause: If the
      Triggering Event was the Executive's Resignation or a Termination by the
      Company for Cause, the Executive shall be entitled to receive his Annual
      Base Compensation and accrued but unpaid vacation through the date thereof
      in accordance with the policy of the Company, and to continue to
      participate in the Company's health, insurance and disability plans and
      programs through that date and thereafter, only to the extent permitted
      under the terms of such plans and programs.

            (b) Death or Total Disability: If the Triggering Event was the
      Executive's death or Total Disability, the Executive (or the Executive's
      designated beneficiary) shall be entitled to receive the Executive's
      Annual Base Compensation and accrued but unpaid vacation through the date
      thereof plus a pro rata portion of the Executive's Potential Annual Target
      Bonus for the calendar year in which such death or Total Disability
      occurred (based on the number of days the Executive was employed during
      the applicable calendar year), in accordance with the policy of the
      Company, and to continue to participate in the Company's health, insurance
      and disability plans and programs through the date of termination and
      thereafter only to the extent permitted under the terms of such plans and
      programs.

            (c) Termination by Company Without Cause: If the Triggering Event
      was a Termination by the Company Without Cause, the Executive shall be
      entitled to receive his Annual Base Compensation and accrued but unpaid
      vacation through the date thereof plus, in the reasonable discretion of
      the Chief Executive Officer based upon whether it then appears the
      Potential Annual Target Bonus for the year would have been earned by the
      Executive had he remained employed by the Company, a pro rata portion of
      the Executive's Potential Annual Target Bonus for the calendar year in
      which such Triggering Event occurred (based on the number of days the
      Executive was employed during the applicable calendar year), payable in
      accordance with the Company's normal payroll practices, provided that in
      addition, for each month of the Severance Period hereinafter referred to,
      the Executive shall also be paid an amount per month equal to one-twelfth
      (1/12th) of his then current Annual Base Compensation in weekly,
      bi-monthly or monthly installments, as the case may be, consistent with
      the Company's normal payroll practices, commencing with the first regular
      payroll payment date following the termination of the Employment Period
      (collectively, the "Additional Severance Benefits"); further provided that
      the Executive shall be entitled to receive such Additional Severance
      Benefits during the Severance Period if and only if the Executive has
      executed and delivered to the Company the General Release substantially in
      form and substance as set forth in Exhibit C to this Agreement and only so
      long as the Executive has not breached any of his covenants to the Company
      set forth in Article IV of this Agreement.

                                       10
<PAGE>

            (d) Cessation of Entitlements and Company Right of Offset. Except as
      otherwise expressly provided herein, all of the Executive's rights to
      salary, employee benefits, fringe benefits and bonuses hereunder (if any)
      which would otherwise accrue after the termination of the Employment
      Period shall cease upon the date of such termination. The Company may
      offset any loans, cash advances or fixed amounts which the Executive owes
      the Company or its Affiliate against any amounts it owes the Executive
      under this Agreement.

      5.3 Survival of Certain Obligations and Termination Certificate. The
provisions of Articles IV, V, VI and VIII shall survive any termination of the
Employment Period, whether by reason of the occurrence of a Triggering Event or
the expiration of the Initial Term or any Extension Term. Immediately following
the termination of the Employment Period, the Executive shall promptly return to
the Company all property required to be returned to the Company pursuant to the
provisions of Section 4.2 hereof and execute and deliver to the Company the
Termination Certificate attached hereto as Exhibit B and by this reference made
a part hereof.

                                   ARTICLE VI
                                   ASSIGNMENT

      6.1 Prohibition of Assignment by Executive. The Executive expressly agrees
for himself and on behalf of his executors, administrators and heirs, that this
Agreement and his obligations, rights, interests and benefits hereunder shall
not be assigned, transferred, pledged or hypothecated in any way by the
Executive, his executors, administrators or heirs, and shall not be subject to
execution, attachment or similar process. Any attempt to assign, transfer,
pledge, hypothecate or otherwise dispose of this Agreement or any such rights,
interests and benefits thereunder contrary to the foregoing provisions, or the
levy of any attachment or similar process thereupon shall be null and void and
without effect and shall relieve the Company of any and all liability hereunder.

      6.2 Right of Company to Assign. Except as provided in the next sentence,
the rights, but not the obligations of the Company shall be assignable and
transferable to any successor-in-interest without the consent of the Executive.
In the instance of a sale of the Company or the sale of all or substantially all
of the assets of the Company, this Agreement and the rights and obligations of
the Company hereunder may be assigned to the acquiring party without the
Executive's consent, and for purposes of this Agreement, such acquirer shall
thereafter be deemed to be the Company.

                                       11
<PAGE>

                                   ARTICLE VII
                                   DEFINITIONS

      "Affiliate" means, with respect to any Person, any other Person directly
or indirectly controlling, controlled by, or under common control with that
Person, provided that, for purposes of this definition, the terms "controls,"
"controlled by," or "under common control with" shall mean that Person's
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such other Person, whether through
the ownership of voting securities, by contract or otherwise.

      "Applicable Territory" means the United States of America and each other
country in which the Company, any of its Subsidiaries or any of their Affiliates
is actively engaged in the conduct of one or more lines of business.

      "Board" means the Board of Directors of the Company.

      "Biological Materials" means (i) classical or genetically modified
strains, micro or other organisms, genes, proteins, peptides, sugars,
metabolites, small molecules, enzymes or DNA, vectors, plasmids, promoters,
expression cassettes or other genomic tools and assay materials which are being
worked with or on by the Company, its Subsidiaries or any of their Affiliates or
which are being worked with or on the Company's, its Subsidiaries' or any of
their Affiliates' behalf by the Company's, its Subsidiaries' or any of their
Affiliates' advisors, research and business collaborators, and (ii) "Biological
Materials" and fermentation or other manufacturing processes being utilized by
the Company, its Subsidiaries or any of their Affiliates, the Company's, its
Subsidiaries' or any of their Affiliates' research or business collaborators or
the Company's, its Subsidiaries' or any of their Affiliates' third party
manufactures for research, pilot scale and/or commercial manufacture of
biotechnology and other products.

      "Chief Executive Officer" means the chief executive officer of the
Company.

      "Compensation Committee" means the Compensation Committee of the Board.

      "Non-Competition Period" means the Employment Period and the eighteen (18)
month period thereafter.

      "Person" means an individual, partnership, limited liability company,
trust, estate, association, corporation, governmental body or other juridical
being.

      "Resignation" means the voluntary termination of employment hereunder by
the Executive on or before the expiration of the Initial Term or any Extension
Term, as the case may be (except if made in contemplation of a Termination by
the Company for Cause), provided that if such action is taken by the Executive
without the giving of at least ninety (90) days prior written notice, such
termination of employment shall not be a "Resignation," but instead shall
constitute a Termination for Cause, further provided that the termination of the
Employment Period on account of the failure of the Executive to extend the
Employment Period in accordance with the provisions of Section 2.2 hereof shall
constitute a Resignation.

                                       12
<PAGE>

            "Severance Period" means the six (6) month period immediately
following the date of the termination of the Employment Period.

            "Subsidiary" means, with respect to any Person of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of such Person or a combination thereof, or (ii) if a limited liability company,
partnership, association or other business entity, a majority of the partnership
or other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more Subsidiaries of such Person
or a combination thereof. For purposes hereof, a Person or Persons shall be
deemed to have a majority ownership interest in a limited liability company,
partnership, association or other business entity if such Person or Persons
shall be allocated a majority of limited liability company, partnership,
association or other business entity gains or losses or shall be or control any
managing director or general partner of such limited liability company,
partnership, association or other business entity.

      "Termination by the Company for Cause" means termination by the Company of
the Executive's employment on or before the expiration of the Initial Term or
any Extension Term, as the case may be, on account of a finding by the
Compensation Committee that the Executive has: (i) breached this Agreement or
any other agreement between the Executive and the Company, any Subsidiary or any
of their Affiliates; (ii) engaged in disloyalty to the Company, including
without limitation, the diversion of corporate opportunity, fraud, embezzlement,
theft, commission of a felony or proven dishonesty, in the course of his
performance of his services hereunder; (iii) disclosed trade secrets or other
Confidential Information of the Company to Persons not entitled to receive such
information; or (iv) engaged in such other behavior detrimental to the interests
of the Company as the Compensation Committee determines; provided that the
termination of the Executive's employment hereunder by the Company shall not be
deemed a Termination by the Company for Cause unless and until there shall have
been delivered to the Executive a written notice from the Chief Executive
Officer (after reasonable notice (in light of the circumstances surrounding the
termination) to and an opportunity for the Executive, alone and in person, to
have a face-to-face meeting with the Compensation Committee) stating that in the
good faith opinion of the Compensation Committee, the Executive was guilty of
the conduct set forth in one or more of the foregoing clauses.

      "Termination by the Company Without Cause" means a termination of the
Executive's employment by the Company on or before the expiration of the Initial
Term or any Extension Term, as the case may be, which is not a Termination by
the Company for Cause, provided that the termination of the Employment Period on
account of the failure of the Company to extend the Employment Period in
accordance with the provisions of Section 2.2 hereof shall constitute a
Termination by the Company Without Cause.

                                       13
<PAGE>

      "Total Disability" means the Executive's inability, because of illness,
injury or other physical or mental incapacity, to perform his duties hereunder
(as determined by the Compensation Committee in good faith) for a continuous
period of ninety (90) consecutive days, or for a total of ninety (90) days
within any three hundred sixty (360) consecutive day period, in which case such
Total Disability shall be deemed to have occurred on the last day of such ninety
(90) day or three hundred sixty (360) day period, as applicable.

                                  ARTICLE VIII
                                     GENERAL

      8.1 Notices. All notices under this Agreement shall be in writing and
shall be deemed properly sent, (i) when delivered, if by personal service or
reputable overnight courier service, or (ii) when received, if sent (x) by
certified or registered mail, postage prepaid, return receipt requested, or (y)
via facsimile transmission (provided that a hard copy of such notice is sent to
the addressee via one of the methods of delivery or mailing set forth above on
the same day the facsimile transmission is sent); to (A) the Executive at the
address of his principal place of residence on file with the Company from time
to time and (B) to the Company, as follows:

            Dyadic International, Inc.
            c/o Chief Executive Officer
            140 Intracoastal Pointe Drive, Suite 404
            Jupiter, Florida  33477
            Facsimile (561) 743-8513

            With a copy to:

            Robert I. Schwimmer, Esq.
            Jenkens & Gilchrist
            225 West Washington, Suite 2600
            Chicago, Illinois 60606
            Facsimile (312) 425-3909

      8.2 Governing Law. This Agreement shall be subject to and governed by the
laws of the State of Florida without regard to any choice of law or conflicts of
law rules or provisions (whether of the State of Florida or any other
jurisdiction), irrespective of the fact that the Executive may become a resident
of a different state.

      8.3 Binding Effect. The Agreement shall be binding upon and inure to the
benefit of the Company, its successors and assigns, and the Executive and his
executors, administrators, personal representatives and heirs.

      8.4 Complete Understanding. This Agreement constitutes the complete
understanding among the parties hereto with regard to the subject matter hereof,
and supersedes any and all prior agreements and understandings relating to the
terms of Executive's employment by the Company, provided that that certain
Invention Disclosure/Assignment, Confidentiality and Non-Compete Agreement
between the Company's Subsidiary and the Executive dated May 21, 2001 which was
assigned by that Subsidiary to the Company on October 29, 2004 (collectively,

                                       14
<PAGE>

the "Prior Proprietary Rights Agreement"), shall, to the extent not inconsistent
with the terms and provisions of this Agreement, remain in full force and effect
as to any rights and obligations of the parties thereunder in existence prior to
the date of this Agreement, further provided that in the event of any
inconsistency between the provisions of this Agreement and the provisions of the
Prior Employment and Proprietary Rights Agreements, or in the event of any
inconsistency between the rights and obligations of the parties under this
Agreement and the rights and obligations of the parties under the Prior
Employment and Proprietary Rights Agreement, in either instance, the provisions
of this Agreement shall control.

      8.5 Amendments. No change, modification or amendment of any provision of
this Agreement shall be valid unless made in writing and signed by all of the
parties hereto.

      8.6 Waiver. The waiver by the Company of a breach of any provision of this
Agreement by the Executive shall not operate or be construed as a waiver of any
subsequent breach by the Executive. The waiver by the Executive of a breach of
any provision of this Agreement by the Company shall not operate as a waiver of
any subsequent breach by the Company.

      8.7 Venue, Jurisdiction, Etc. The Executive hereby agrees that any suit,
action or proceeding relating in any way to this Agreement may be brought and
enforced in the Circuit Court of Palm Beach County of the State of Florida or in
the District Court of the United States of America for the Southern District of
Florida, and in either case the Executive hereby submits to the jurisdiction of
each such court. The Executive hereby waives and agrees not to assert, by way of
motion or otherwise, in any such suit, action or proceeding, any claim that the
Executive is not personally subject to the jurisdiction of the above-named
courts, that the suit, action or proceeding is brought in an inconvenient forum
or that the venue of the suit, action or proceeding is improper. The Executive
consents and agrees to service of process or other legal summons for purpose of
any such suit, action or proceeding by registered mail addressed to the
Executive at his or her address listed in the business records of the Company.
Nothing contained herein shall affect the rights of the Company to bring suit,
action or proceeding in any other appropriate jurisdiction. The Executive and
the Company do each hereby waive any right to trial by jury, he or it may have
concerning any matter relating to this Agreement.

      8.8 Severability. If any portion of this Agreement shall be for any
reason, invalid or unenforceable, the remaining portion or portions shall
nevertheless be valid, enforceable and carried into effect.

      8.9 Headings. The headings of this Agreement are inserted for convenience
only and are not to be considered in the construction of the provisions hereof.

      8.10 Counterparts. This Agreement may be executed in one or more
counterparts, all of which, taken together, shall constitute one and the same
agreement.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above-written.

                                       15
<PAGE>

COMPANY:                                        EXECUTIVE:

DYADIC INTERNATIONAL, INC., a
Delaware Corporation
                                                ------------------------------
                                                 Alexander (Sasha) Bondar
 By:____________________________
         Chief Executive Officer

                                       16
<PAGE>

                                    EXHIBIT A
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                            ALEXANDER (SASHA) BONDAR


                             STOCK OPTION AGREEMENT

<PAGE>

                           DYADIC INTERNATIONAL, INC.
                          2001 EQUITY COMPENSATION PLAN
                          STOCK OPTION GRANT AGREEMENT

      This STOCK OPTION GRANT AGREEMENT (this "Agreement"), dated as of March
30, 2005 (the "Date of Grant"), is delivered by Dyadic International, Inc. (the
"Company") to Alexander (Sasha) Bondar (the "Grantee").

                                    RECITALS

      A. Concurrently with the execution and delivery of this Agreement, the
Grantee has entered into an employment agreement with the Company dated of even
date herewith (as may be amended, restated or otherwise modified, the
"Employment Agreement"), pursuant to which the Grantee will serve as the
Company's Vice President, Strategy & Corporate Development.

      B. The Dyadic International, Inc. 2001 Equity Compensation Plan (as may be
amended, restated or otherwise modified, the "Plan") provides for the grant of
options to purchase shares of common stock of the Company. A copy of the Plan
has heretofore been furnished to the Grantee, receipt of which is hereby
expressly acknowledged. Capitalized terms used but not otherwise defined herein
shall have the meanings given such terms in the Plan.

      C. As contemplated in Section 1(a) of the Plan, the Board of Directors of
the Company has appointed a committee (the "Committee") to administer the Plan.

      D. To induce the Grantee to enter into the Employment Agreement and
continue to perform the obligations specified therein and promote the best
interests of the Company, the Committee has decided to Grant an Option to the
Grantee under the Plan to purchase shares of Company Stock ("Shares").

                                   AGREEMENT:

      NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:

1. Grant of Option. Subject to the terms and conditions set forth in this
Agreement and in the Plan, the Company hereby grants to the Grantee an Option to
purchase 35,000 Shares at an exercise price of $3.025 per Share (which is the
Fair Market Value on the date of Grant, being equal to the mean of the final
"asked" and "bid" prices of the Shares on the date hereof, as fixed by the terms
of the Plan). The Option shall become exercisable in accordance with the terms
of Paragraph 2 below. In accordance with Section 5(g) of the Plan, the Option
shall be treated as an Incentive Stock Option


                                       2
<PAGE>

except to the extent that the aggregate Fair Market Value of the Shares as of
the date of the grant with respect to which Incentive Stock Option is for the
first time exercisable by the Grantee during any calendar year under the Plan
exceeds $100,000, then the Option, as to such excess, shall be treated as a
Nonqualified Stock Option.

2. Exercisability of Option. The number of Shares in respect of which the
Grantee shall be permitted to exercise the Option shall be determined by
reference to the dates (each a "Vesting Date") fixed in the table set forth
below, provided that: (a) exercisability of Shares is cumulative; and (b) there
must not have occurred a termination of the Grantee's employment with the
Company (the "Employment Relationship") for any reason whatsoever (the date of
such termination being hereinafter referred to as the "Termination Date") prior
to a Vesting Date in order for the Option to be exercisable in respect of the
Shares indicated opposite that Vesting Date:

            Vesting Date                         Additional Shares for Which the
                                                      Option is Exercisable
      1st Anniversary of Date of Grant                1/4th of Option Shares
      2nd Anniversary of Date of Grant                1/4th of Option Shares
      3rd Anniversary of Date of Grant                1/4th of Option Shares
      4th Anniversary of Date of Grant                1/4th of Option Shares

3. Term of Option.

      (a) The Option shall be exercisable for a term commencing with the Date of
Grant and ending on the earlier of (i) the fifth (5th) anniversary of the Date
of Grant or (ii) the termination of the Plan, unless the Option is terminated at
an earlier date in accordance with the provisions of this Agreement or the Plan.

      (b) Any portion of the Option that is not exercisable on the Termination
Date shall terminate on that date.

      (c) The Option, to the extent exercisable, shall automatically terminate
upon the earlier of (x) the expiration of the period fixed in Paragraph 3(a),
above, or (y) the first to occur of any of the following events:

            (i) Subject to clause (v) below, the expiration of the 90 day period
      following the Termination Date, if the termination is for any reason other
      than the Disability of the Grantee, his death or for Cause.

            (ii) Subject to clause (v) below, the expiration of the one (1) year
      period after the Termination Date, to the extent the Option is then
      unvested, if the termination of the Employment Relationship was on account
      of the Grantee's Disability.

                                       3
<PAGE>

          (iii) The expiration of the one (1) year period after the
      Termination Date, if the reason for the termination of the Employment
      Relationship was on account of the Grantee's death.

            (iv) The Termination Date, if the termination of the Employment
      Relationship was for Cause.

            (v) The provisions of clauses (i) and (ii) above to the contrary
      notwithstanding, if the Grantee engages in conduct that constitutes Cause
      after the Termination Date, the Option shall immediately terminate to the
      extent then unexercised (regardless of vesting).

      (d) In accordance with Section 5(e)(ii) of the Plan, if the provisions of
either clause (iv) or clause (v) of Paragraph 3(c) applied to the termination of
the Option, the Grantee shall automatically forfeit all Shares underlying any
exercised portion of the Option for which the Company has not yet delivered the
share certificates, upon refund by the Company of the exercise price paid by the
Grantee for such Shares.

4. Exercise Procedures.

      (a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee may
exercise part or all of the exercisable portion of the Option by giving the
Committee written notice of intent to exercise in the manner provided in this
Agreement, specifying the number of Shares as to which the Option is to be
exercised. On the delivery date, the Grantee shall pay the exercise price (i) in
cash, (ii) with the approval of the Committee, by delivering Shares of the
Company which shall be valued at their fair market value on the date of delivery
(such valuation to be determined in the manner fixed in the Plan), (iii) payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board or (iv) by such other method as the Committee may approve,
provided that the Committee may, in its absolute discretion, impose from time to
time such limitations as it deems appropriate on the use of Shares of the
Company to exercise the Option.

      (b) The obligation of the Company to deliver Shares upon exercise of the
Option shall be subject to all applicable laws, rules, and regulations and such
approvals by governmental agencies as may be deemed appropriate by the
Committee, including such actions as Company counsel shall deem necessary or
appropriate to comply with relevant securities laws and regulations. The Company
may require that the Grantee (or other person exercising the Option after the
Grantee's death) represent that the Grantee is purchasing Shares for the
Grantee's own account and not with a view to or for sale in connection with any
distribution of the Shares, or such other representation as the Committee deems
appropriate. All obligations of the Company under this Agreement shall be
subject to the rights of the Company as set forth in the Plan to withhold
amounts required to be withheld for any taxes, if applicable. Subject to
Committee approval, in its absolute discretion, the Grantee may elect to satisfy
any income tax withholding obligation of the Company with respect to the Option
by having Shares withheld up to an amount that does not exceed the minimum
applicable withholding tax rate for federal (including FICA), state and local
tax liabilities.

                                       4
<PAGE>

5. Restrictions on Transfer of Shares. In addition to the restrictions imposed
by the Plan on the transferability of the Shares acquired by an the Grantee's
exercise of the Option granted hereby, without the prior consent of the Company,
for so long as the Company is not a "Reporting Company" within the meaning of
the Exchange Act of 1934, as amended, the Grantee shall make no transfer of the
Shares (a) for a period of five (5) years following the date of this Agreement
and (b) thereafter, to any competitor of the Company.

6. Change of Control. The provisions of the Plan applicable to a Change of
Control shall apply to the Option, and, in the event of a Change of Control, the
Committee may take such actions as it deems appropriate pursuant to the Plan.

7. Restrictions on Exercise. Only the Grantee may exercise the Option during the
Grantee's lifetime and, after the Grantee's death, the Option shall be
exercisable (subject to the limitations specified in the Plan) solely by the
legal representatives of the Grantee, or by the person who acquires the right to
exercise the Option by will or by the laws of descent and distribution, to the
extent that the Option is exercisable pursuant to this Agreement.

8. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
the terms of which are incorporated herein by reference, and in all respects
shall be interpreted in accordance with the Plan. The grant and exercise of the
Option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) rights and obligations with respect
to withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) changes in capitalization of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the Option pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.

9. No Employment or Other Rights. The grant of the Option shall not confer upon
the Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any time for
any reason is specifically reserved.

10. No Shareholder Rights. Neither the Grantee, nor any person entitled to
exercise the Grantee's rights in the event of the Grantee's death, shall have
any of the rights and privileges of a shareholder with respect to the Shares
subject to the Option, until certificates for Shares have been issued upon the
exercise of the Option.

                                       5
<PAGE>

11. Assignment and Transfers. The rights and interests of the Grantee under this
Agreement may not be sold, assigned, encumbered or otherwise transferred except,
in the event of the death of the Grantee, by will or by the laws of descent and
distribution. In the event of any attempt by the Grantee to alienate, assign,
pledge, hypothecate, or otherwise dispose of the Option or any right hereunder,
except as provided for in this Agreement, or in the event of the levy or any
attachment, execution or similar process upon the rights or interests hereby
conferred, the Company may terminate the Option by notice to the Grantee, and
the Option and all rights hereunder shall thereupon become null and void. The
rights and protections of the Company hereunder shall extend to any successors
or assigns of the Company and to the Company's parents, subsidiaries, and
affiliates. This Agreement may be assigned by the Company without the Grantee's
consent.

12. Applicable Law. The validity, construction, interpretation and effect of
this instrument shall be governed by and construed in accordance with the laws
of the State of Florida, without giving effect to the conflicts of laws
provisions thereof.

13. Notice. Any notice to the Company provided for in this instrument shall be
addressed to the Company in care of the Chief Executive Officer at the Company's
principal executive offices, and any notice to the Grantee shall be addressed to
such Grantee at the current address shown on the payroll of the Company, or to
such other address as the Grantee may designate to the Company in writing. Any
notice shall be delivered by hand, sent by telecopy or enclosed in a properly
sealed envelope addressed as stated above, registered and deposited, postage
prepaid, in a post office regularly maintained by the United States Postal
Service.

14. Counterparts. This Agreement may be signed in any number of counterparts and
by facsimile signature, each of which shall be deemed to be an original, and all
of which taken together shall be deemed to be one and the same instrument.

      15. Complete Understanding. This Agreement, together with the Plan,
contains the entire agreement of the parties relating to the subject matter
hereof and supersedes all prior agreements and understanding with respect to
such subject matter, and the parties hereto have made no agreements,
representations or warranties relating to the subject matter of this Agreement
which are not set forth herein, provided that the Parties are parties to the
Employment Agreement. Nothing contained in this Agreement shall be construed to
limit or affect in any manner or to any extent the restrictions or prohibitions
that are applicable to the Grantee under the Employment Agreement or the
duration thereof. Similarly, except as expressly provided otherwise in this
Agreement, nothing contained in the Employment Agreement shall be construed to
limit or affect in any manner or to any extent the restrictions or prohibitions
that are applicable to the Grantee under this Agreement.

                            [Signature Page Follows]


                                       6
<PAGE>

      IN WITNESS WHEREOF, the Company has caused a duly authorized officer to
execute this Agreement, and the Grantee has executed this Agreement, effective
as of the Date of Grant.

THE COMPANY:                              GRANTEE:

DYADIC INTERNATIONAL, INC.

By:   _____________                       Accepted:   __________________________
      President                                       Alexander (Sasha) Bondar


                                       7
<PAGE>

                                    EXHIBIT B
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                            ALEXANDER (SASHA) BONDAR

                             TERMINATION CERTIFICATE

      This is to certify that, except as permitted by the Employment Agreement
(as defined below) I do not have in my possession, nor have I failed to return,
any software, inventions, designs, works of authorship, copyrightable works,
formulas, data, marketing plans, forecasts, product concepts, marketing plans,
strategies, forecasts, devices, records, data, notes, reports, proposals,
customer lists, correspondence, specifications, drawings, blueprints, sketches,
materials, patent applications, continuation applications, continuation-in-part
applications, divisional applications, other documents or property, or
reproductions of any aforementioned items belonging to DYADIC INTERNATIONAL,
INC. (the "Company"), its Subsidiaries and their Affiliates, successors or
assigns.

      I further certify that I have complied with all the terms of the
Employment Agreement dated as of March 30, 2005 between the Company and me (as
the same may be amended, restated or otherwise modified, the "Employment
Agreement"), relating to the reporting of any Work Product conceived or made by
me (solely or jointly with others) covered by the Employment Agreement.
Capitalized terms used but not otherwise defined herein shall have the meanings
given such terms in the Employment Agreement.

      I acknowledge that the provisions of the Employment Agreement relating to
Confidential Information continue in effect beyond the termination of the
Employment Agreement, as set forth therein.

      Finally, I further acknowledge that the provisions of the Employment
Agreement relating to my (i) anti-pirating, (ii) non-interference and (iii)
non-competition covenants to the Company, its Subsidiaries and their Affiliates,
also remain in effect following the date of my termination of employment with
the Company.

Date:____________                   ______________________________
         Executive


                                       8
<PAGE>

                                    EXHIBIT C
                                       to
                         EXECUTIVE EMPLOYMENT AGREEMENT
                                     between
                           DYADIC INTERNATIONAL, INC.
                                       and
                            ALEXANDER (SASHA) BONDAR

                                 GENERAL RELEASE

      I, Alexander (Sasha) Bondar, in consideration of and subject to the
performance by DYADIC INTERNATIONAL, INC., a Delaware corporation (the
"Company"), of its material obligations under the Employment Agreement, dated as
of March 30, 2005 (as the same may be amended, restated or otherwise modified,
the "Agreement"), do hereby release and forever discharge as of the date hereof
the Company, its Subsidiaries and their Affiliates (as those terms are defined
in the Agreement) and all present and former directors, officers, agents,
representatives, employees, successors and assigns of the Company, its
Subsidiaries and their Affiliates and their direct or indirect owners
(collectively, the "Released Parties") to the extent provided below.

1.    I understand  that any payments or benefits  paid or granted to me under
      Section 5.2(c) of the Agreement  represent,  in part,  consideration for
      signing  this General  Release and are not salary,  wages or benefits to
      which I was already  entitled.  I  understand  and agree that I will not
      receive the  payments and  benefits  specified in Section  5.2(c) of the
      Agreement  unless I execute this General  Release and do not revoke this
      General  Release  within the time period  permitted  hereafter or breach
      this General Release.

2.    Except as provided in paragraph 4 of this General  Release,  I knowingly
      and voluntarily  release and forever discharge the Company and the other
      Released  Parties  from  any and  all  claims,  controversies,  actions,
      causes  of  action,   cross-claims,   counterclaims,   demands,   debts,
      compensatory   damages,   liquidated  damages,   punitive  or  exemplary
      damages,  other  damages,  claims  for costs  and  attorneys'  fees,  or
      liabilities  of any nature  whatsoever  in law and in equity,  both past
      and  present  (through  the date of this  General  Release)  and whether
      known or unknown,  suspected,  or claimed  against the Company or any of
      the Released Parties which I, my spouse, or any of my heirs,  executors,
      administrators  or  assigns,  may  have,  which  arise  out  of  or  are
      connected  with my employment  with, or my separation  from, the Company
      (including,  but not limited  to, any  allegation,  claim or  violation,
      arising  under:  Title VII of the Civil Rights Act of 1964,  as amended;
      the Civil Rights Act of 1991; the Age  Discrimination  in Employment Act
      of 1967,  as amended  (including  the Older Workers  Benefit  Protection
<PAGE>

      Act);  the  Equal  Pay Act of  1963,  as  amended;  the  Americans  with
      Disabilities  Act of 1990; the Family and Medical Leave Act of 1993; the
      Civil Rights Act of 1866, as amended;  the Worker Adjustment  Retraining
      and Notification  Act; the Executive  Retirement  Income Security Act of
      1974; any applicable Executive Order Programs;  the Fair Labor Standards
      Act; or their state or local  counterparts;  or under any other federal,
      state or local  civil or human  rights  law,  or under any other  local,
      state,  or federal law,  regulation  or  ordinance;  or under any public
      policy,  contract or tort,  or under  common  law; or arising  under any
      policies,  practices  or  procedures  of the  Company;  or any claim for
      wrongful  discharge,  breach  of  contract,   negligent  or  intentional
      infliction of emotional  distress,  defamation;  or any claim for costs,
      fees, or other  expenses,  including  attorneys'  fees incurred in these
      matters)  (all of the foregoing  collectively  referred to herein as the
      "Claims").

3.    I represent that I have made no assignment or transfer of any right,
      claim, demand, cause of action, or other matter covered by paragraph 2 of
      this General Release.

4.    I and the Company  mutually  agree that this  General  Release  does not
      waive or release  any rights or claims  that I may have  under:  (a) the
      Age  Discrimination in Employment Act of 1967 which arise after the date
      I execute this General  Release;  and (b) any  agreements to which I and
      the Company  and/or any of its  Subsidiaries  or Affiliates  are parties
      pertaining to any shares or options to purchase  shares of capital stock
      of the Company  and/or any of its  Subsidiaries  or Affiliates  owned by
      me. I acknowledge  and agree that my separation from employment with the
      Company in compliance  with the terms of the  Agreement  shall not serve
      as the basis for any claim or  action  (including,  without  limitation,
      any claim under the Age Discrimination in Employment Act of 1967).

5.    In signing this General Release,  I acknowledge and intend that it shall
      be  effective  as a bar to each and every one of the Claims  hereinabove
      mentioned or implied.  I expressly  consent  that this  General  Release
      shall be given full force and  effect  according  to each and all of its
      express terms and  provisions,  including  those relating to unknown and
      unsuspected  Claims  (notwithstanding  any state statute that  expressly
      limits the  effectiveness  of a general release of unknown,  unsuspected
      and  unanticipated  Claims),  if any,  as well as those  relating to any
      other Claims  hereinabove  mentioned or implied. I acknowledge and agree
      that this  waiver is an  essential  and  material  term of this  General
      Release and that without  such waiver the Company  would not have agreed
      to the  terms of the  Agreement.  I  further  agree  that in the event I
      should bring a Claim seeking  damages  against any Released Party, or in
      the event I should  seek to recover  against any  Released  Party in any
      Claim  brought  by a  governmental  agency on my  behalf,  this  General
      Release  shall  serve as a complete  defense to such  Claims.  I further
      agree  that I am not aware of any  pending  charge or  complaint  of the
      type  described  in  paragraph  2 as of the  execution  of this  General
      Release.

6.    I agree that neither this General Release, nor the furnishing of the
      consideration for this General Release, shall be deemed or construed at
      any time to be an admission by the Company, any Released Party or myself
      of any improper or unlawful conduct.

7.    I agree that if I challenge  the  validity of this  General  Release,  I
      will  forfeit  all  unpaid  amounts  otherwise  payable  by the  Company
      pursuant to Section  5.2(c) of the  Agreement  other than the very first
      payment due me  thereunder,  provided that nothing  herein  contained in

                                       2
<PAGE>

      this Agreement shall prohibit or bar me from filing a charge,  including
      a challenge to the  validity of the  Agreement,  with the United  States
      Equal Employment  Opportunity Commission ("EEOC"), or any state or local
      fair  employment   practices  agency,  or  from   participating  in  any
      investigation,  hearing  or  proceeding  conducted  by the EEOC,  or any
      state or local fair employment  practices agency. I also agree that if I
      violate this General  Release by suing the Company or the other Released
      Parties,  I will pay all costs and  expenses  of  defending  against the
      suit incurred by the Released Parties,  including reasonable  attorneys'
      fees, and return all payments received by me pursuant to the Agreement.

8.    I agree that this General Release is confidential and agree not to
      disclose any information regarding the terms of this General Release,
      except to my immediate family and any tax, legal or other counsel I have
      consulted regarding the meaning or effect hereof or as required by law,
      and I will instruct each of the foregoing not to disclose the same to
      anyone.

9.    Any non-disclosure provision in this General Release does not prohibit or
      restrict me (or my attorney) from responding to any inquiry about this
      General Release or its underlying facts and circumstances by the
      Securities and Exchange Commission (SEC), the EEOC (or a state or local
      fair employment practices agency), the National Association of Securities
      Dealers, Inc. (NASD), any other self-regulatory organization or
      governmental entity.

10.   I agree  to  reasonably  cooperate  with  the  Company  in any  internal
      investigation or administrative,  regulatory,  or judicial proceeding. I
      understand  and  agree  that  my  cooperation  may  include,  but not be
      limited to,  making  myself  available  to the Company  upon  reasonable
      notice for  interviews  and  factual  investigations;  appearing  at the
      Company's  request  to give  testimony  without  requiring  service of a
      subpoena or other legal process;  volunteering to the Company  pertinent
      information;  and turning  over to the Company  all  relevant  documents
      which are or may come into my  possession  all at times and on schedules
      that are reasonably  consistent with my other  permitted  activities and
      commitments,  provided  that I shall have no  obligation  to expend more
      than one week of my time in  connection  with the  performance  of these
      activities which out reasonable  recompense,  as mutually and reasonably
      agreed upon by me and the Company.  I  understand  that in the event the
      Company asks for my cooperation in accordance with this  provision,  the
      Company  will  reimburse  me  solely  for  reasonable  travel  expenses,
      including lodging and meals, upon my submission of receipts.

11.   Notwithstanding anything in this General Release to the contrary, this
      General Release shall not relinquish, diminish, or in any way affect any
      rights or claims arising out of any breach by the Company or by any
      Released Party of the Agreement.

12.   Whenever  possible,  each  provision  of this General  Release  shall be
      interpreted  in,  such  manner  as  to  be  effective  and  valid  under
      applicable  law, but if any provision of this General Release is held to
      be  invalid,   illegal  or   unenforceable  in  any  respect  under  any
      applicable law or rule in any jurisdiction, such invalidity,  illegality
      or  unenforceability  shall not affect any other  provision or any other
      jurisdiction,  but this General Release shall be reformed, construed and
      enforced  in  such   jurisdiction   as  if  such  invalid,   illegal  or
      unenforceable provision had never been contained herein.

                                       3
<PAGE>

BY SIGNING THIS GENERAL RELEASE, I REPRESENT AND AGREE THAT:

(a)   I HAVE READ IT CAREFULLY;

(b)   I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT
      RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION
      IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT
      OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH
      DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
      OF 1974, AS AMENDED;

(c)   I VOLUNTARILY CONSENT TO EVERYTHING IN IT;

(d)   I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I
      HAVE DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION I HAVE CHOSEN NOT
      TO DO SO OF MY OWN VOLITION;

(e)   I HAVE HAD AT LEAST 21 DAYS FROM THE DATE OF MY RECEIPT OF THIS RELEASE
      SUBSTANTIALLY IN ITS FINAL FORM ON _______________ ____, ____ TO CONSIDER
      IT AND THE CHANGES MADE SINCE THE ______________ _____, _____VERSION OF
      THIS RELEASE ARE NOT MATERIAL AND WILL NOT RESTART THE REQUIRED 21-DAY
      PERIOD;

(f)   THE CHANGES TO THE AGREEMENT SINCE ____________ ___, _____ EITHER ARE NOT
      MATERIAL OR WERE MADE AT MY REQUEST.

(g)   I UNDERSTAND THAT I HAVE SEVEN DAYS AFTER THE EXECUTION OF THIS RELEASE TO
      REVOKE IT AND THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE
      UNTIL THE REVOCATION PERIOD HAS EXPIRED;

(h)   I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND WITH THE
      ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND


                                       4
<PAGE>

(i)   I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED,
      WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY
      AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME.

DATE:                                     _____________________

                                       5

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.5
<SEQUENCE>6
<FILENAME>ex99-5.txt
<TEXT>
                     FORM OF EMPLOYEE STOCK OPTION AGREEMENT
                                   (Rev 1/05)

                           DYADIC INTERNATIONAL, INC.
                          2001 EQUITY COMPENSATION PLAN
                          STOCK OPTION GRANT AGREEMENT

         This STOCK OPTION GRANT AGREEMENT (this "Agreement"), dated as of
[INSERT DATE] (the "Date of Grant"), is delivered by Dyadic International, Inc.
(the "Company") to [INSERT EMPLOYEE NAME]. (the "Grantee").

                                    RECITALS

         A. [INSERT APPROPRIATE CONORMING CHANGES] Concurrently with the
execution and delivery of this Agreement, the Grantee has entered into an
employment agreement with the Company dated of even date herewith (as may be
amended, restated or otherwise modified, the "Employment Agreement"), pursuant
to which the Grantee will serve as the [INSERT TITLE].

         B. The Dyadic International, Inc. 2001 Equity Compensation Plan (as may
be amended, restated or otherwise modified, the "Plan") provides for the grant
of options to purchase shares of common stock of the Company. A copy of the Plan
has heretofore been furnished to the Grantee, receipt of which is hereby
expressly acknowledged. Capitalized terms used but not otherwise defined herein
shall have the meanings given such terms in the Plan.

         C. As contemplated in Section 1(a) of the Plan, the Board of Directors
of the Company has appointed a committee (the "Committee") to administer the
Plan.

         D. To induce the Grantee to enter into the Employment Agreement and
continue to perform the obligations specified therein and promote the best
interests of the Company, the Committee has decided to Grant an Option to the
Grantee under the Plan to purchase shares of Company Stock ("Shares").

                                   AGREEMENT:

         NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:

1. Grant of Option. Subject to the terms and conditions set forth in this
Agreement and in the Plan, the Company hereby grants to the Grantee an Option to
purchase 40,000 Shares at an exercise price of $[INSERT PRICE] per Share (which
is the Fair Market Value on the date of Grant, being equal to the mean of the
final "asked" and "bid" prices of the Shares on the date hereof, as fixed by the
terms of the Plan). The Option shall become exercisable in accordance with the
terms of Paragraph 2 below. In accordance with Section 5(g) of the Plan, the
Option shall be treated as an Incentive Stock Option except to the extent that
the aggregate Fair Market Value of the Shares as of the date of the grant with
respect to which Incentive Stock Option is for the first time exercisable by the
Grantee during any calendar year under the Plan exceeds $100,000, then the
Option, as to such excess, shall be treated as a Nonqualified Stock Option.
<PAGE>

2. Exercisability of Option. The number of Shares in respect of which the
Grantee shall be permitted to exercise the Option shall be determined by
reference to the dates (each a "Vesting Date") fixed in the table set forth
below, provided that: (a) exercisability of Shares is cumulative; and (b) there
must not have occurred a termination of the Grantee's employment with the
Company (the "Employment Relationship") for any reason whatsoever (the date of
such termination being hereinafter referred to as the "Termination Date") prior
to a Vesting Date in order for the Option to be exercisable in respect of the
Shares indicated opposite that Vesting Date:

               Vesting Date                      Additional Shares for Which the
                                                      Option is Exercisable
         1st Anniversary of Date of Grant             1/4th of Option Shares
         2nd Anniversary of Date of Grant             1/4th of Option Shares
         3rd Anniversary of Date of Grant             1/4th of Option Shares
         4th Anniversary of Date of Grant             1/4th of Option Shares

3. Term of Option.

         (a) The Option shall be exercisable for a term commencing with the Date
of Grant and ending on the earlier of (i) the fifth (5th) anniversary of the
Date of Grant or (ii) the termination of the Plan, unless the Option is
terminated at an earlier date in accordance with the provisions of this
Agreement or the Plan.

         (b) Any portion of the Option that is not exercisable on the
Termination Date shall terminate on that date.

         (c) The Option, to the extent exercisable, shall automatically
terminate upon the earlier of (x) the expiration of the period fixed in
Paragraph 3(a), above, or (y) the first to occur of any of the following events:

                  (i) Subject to clause (v) below, the expiration of the 90 day
         period following the Termination Date, if the termination is for any
         reason other than the Disability of the Grantee, his death or for
         Cause.

                  (ii) Subject to clause (v) below, the expiration of the one
         (1) year period after the Termination Date, to the extent the Option is
         then unvested, if the termination of the Employment Relationship was on
         account of the Grantee's Disability.

                  (iii) The expiration of the one (1) year period after the
         Termination Date, if the reason for the termination of the Employment
         Relationship was on account of the Grantee's death.
<PAGE>

                  (iv) The Termination Date, if the termination of the
         Employment Relationship was for Cause.

                  (v) The provisions of clauses (i) and (ii) above to the
         contrary notwithstanding, if the Grantee engages in conduct that
         constitutes Cause after the Termination Date, the Option shall
         immediately terminate to the extent then unexercised (regardless of
         vesting).

         (d) In accordance with Section 5(e)(ii) of the Plan, if the provisions
of either clause (iv) or clause (v) of Paragraph 3(c) applied to the termination
of the Option, the Grantee shall automatically forfeit all Shares underlying any
exercised portion of the Option for which the Company has not yet delivered the
share certificates, upon refund by the Company of the exercise price paid by the
Grantee for such Shares.

4.       Exercise Procedures.

         (a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee
may exercise part or all of the exercisable portion of the Option by giving the
Committee written notice of intent to exercise in the manner provided in this
Agreement, specifying the number of Shares as to which the Option is to be
exercised. On the delivery date, the Grantee shall pay the exercise price (i) in
cash, (ii) with the approval of the Committee, by delivering Shares of the
Company which shall be valued at their fair market value on the date of delivery
(such valuation to be determined in the manner fixed in the Plan), (iii) payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board or (iv) by such other method as the Committee may approve,
provided that the Committee may, in its absolute discretion, impose from time to
time such limitations as it deems appropriate on the use of Shares of the
Company to exercise the Option.

         (b) The obligation of the Company to deliver Shares upon exercise of
the Option shall be subject to all applicable laws, rules, and regulations and
such approvals by governmental agencies as may be deemed appropriate by the
Committee, including such actions as Company counsel shall deem necessary or
appropriate to comply with relevant securities laws and regulations. The Company
may require that the Grantee (or other person exercising the Option after the
Grantee's death) represent that the Grantee is purchasing Shares for the
Grantee's own account and not with a view to or for sale in connection with any
distribution of the Shares, or such other representation as the Committee deems
appropriate. All obligations of the Company under this Agreement shall be
subject to the rights of the Company as set forth in the Plan to withhold
amounts required to be withheld for any taxes, if applicable. Subject to
Committee approval, in its absolute discretion, the Grantee may elect to satisfy
any income tax withholding obligation of the Company with respect to the Option
by having Shares withheld up to an amount that does not exceed the minimum
applicable withholding tax rate for federal (including FICA), state and local
tax liabilities.

5. Restrictions on Transfer of Shares. In addition to the restrictions imposed
by the Plan on the transferability of the Shares acquired by an the Grantee's
exercise of the Option granted hereby, without the prior consent of the Company,
for so long as the Company is not a "Reporting Company" within the meaning of
the Exchange Act of 1934, as amended, the Grantee shall make no transfer of the
Shares (a) for a period of five (5) years following the date of this Agreement
and (b) thereafter, to any competitor of the Company.
<PAGE>

6. Change of Control. The provisions of the Plan applicable to a Change of
Control shall apply to the Option, and, in the event of a Change of Control, the
Committee may take such actions as it deems appropriate pursuant to the Plan.

7. Restrictions on Exercise. Only the Grantee may exercise the Option during the
Grantee's lifetime and, after the Grantee's death, the Option shall be
exercisable (subject to the limitations specified in the Plan) solely by the
legal representatives of the Grantee, or by the person who acquires the right to
exercise the Option by will or by the laws of descent and distribution, to the
extent that the Option is exercisable pursuant to this Agreement.

8. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
the terms of which are incorporated herein by reference, and in all respects
shall be interpreted in accordance with the Plan. The grant and exercise of the
Option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) rights and obligations with respect
to withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) changes in capitalization of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the Option pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.

9. No Employment or Other Rights. The grant of the Option shall not confer upon
the Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any time for
any reason is specifically reserved.

10. No Shareholder Rights. Neither the Grantee, nor any person entitled to
exercise the Grantee's rights in the event of the Grantee's death, shall have
any of the rights and privileges of a shareholder with respect to the Shares
subject to the Option, until certificates for Shares have been issued upon the
exercise of the Option.

11. Assignment and Transfers. The rights and interests of the Grantee under this
Agreement may not be sold, assigned, encumbered or otherwise transferred except,
in the event of the death of the Grantee, by will or by the laws of descent and
distribution. In the event of any attempt by the Grantee to alienate, assign,
pledge, hypothecate, or otherwise dispose of the Option or any right hereunder,
except as provided for in this Agreement, or in the event of the levy or any

<PAGE>

attachment, execution or similar process upon the rights or interests hereby
conferred, the Company may terminate the Option by notice to the Grantee, and
the Option and all rights hereunder shall thereupon become null and void. The
rights and protections of the Company hereunder shall extend to any successors
or assigns of the Company and to the Company's parents, subsidiaries, and
affiliates. This Agreement may be assigned by the Company without the Grantee's
consent.

12. Applicable Law. The validity, construction, interpretation and effect of
this instrument shall be governed by and construed in accordance with the laws
of the State of Florida, without giving effect to the conflicts of laws
provisions thereof.

13. Notice. Any notice to the Company provided for in this instrument shall be
addressed to the Company in care of the Chief Executive Officer at the Company's
principal executive offices, and any notice to the Grantee shall be addressed to
such Grantee at the current address shown on the payroll of the Company, or to
such other address as the Grantee may designate to the Company in writing. Any
notice shall be delivered by hand, sent by telecopy or enclosed in a properly
sealed envelope addressed as stated above, registered and deposited, postage
prepaid, in a post office regularly maintained by the United States Postal
Service.

14. Counterparts. This Agreement may be signed in any number of counterparts and
by facsimile signature, each of which shall be deemed to be an original, and all
of which taken together shall be deemed to be one and the same instrument.

15. Complete Understanding. This Agreement, together with the Plan, contains the
entire agreement of the parties relating to the subject matter hereof and
supersedes all prior agreements and understanding with respect to such subject
matter, and the parties hereto have made no agreements, representations or
warranties relating to the subject matter of this Agreement which are not set
forth herein, provided that the Parties are parties to the Employment Agreement.
Nothing contained in this Agreement shall be construed to limit or affect in any
manner or to any extent the restrictions or prohibitions that are applicable to
the Grantee under the Employment Agreement or the duration thereof. Similarly,
except as expressly provided otherwise in this Agreement, nothing contained in
the Employment Agreement shall be construed to limit or affect in any manner or
to any extent the restrictions or prohibitions that are applicable to the
Grantee under this Agreement.

                            [Signature Page Follows]

<PAGE>




         IN WITNESS WHEREOF, the Company has caused a duly authorized officer to
execute this Agreement, and the Grantee has executed this Agreement, effective
as of the Date of Grant.

THE COMPANY:                               GRANTEE:

DYADIC INTERNATIONAL, INC.

By:                                        Accepted:
   ---------------------------------                --------------------------
         President                                   [INSERT EMPLOYEE NAME]

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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