Document:

LIBRARY
      AGREEMENT

     

    THIS
      LIBRARY ACCESS AGREEMENT
      (“Agreement”) is made effective as of April 27, 2004 (“Effective Date”) by
      and between ChemBridge Corporation, an Illinois corporation (“ChemBridge”), and
      Cleveland BioLabs, Inc., a Delaware corporation.

     

    WHEREAS,
      ChemBridge has a collection of chemical libraries (the “Libraries”, as defined
      below),

     

    WHEREAS,
      CBL
      desires a license from ChemBridge to use the Libraries in research and
      development,

     

    WHEREAS,
      ChemBridge desires to collaborate with CBL in the optimization of lead
      compounds.

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual covenants and agreements set forth below, the
      parties covenant and agree as follows:

     

    Section
      1. Definitions.
      

     

    For
      purposes of this Agreement, the following definitions shall apply:

     

    A. “Affiliates”
      shall mean any individual or entity directly or indirectly controlling,
      controlled by or under common control with, a party to this Agreement. For
      purposes of this Agreement, the direct or indirect ownership of fifty percent
      (50%) or more of the outstanding voting securities of an entity, or the right
      to
      receive fifty percent (50%) or more of the profits or earnings of an entity
      shall be deemed to constitute control. Such other relationship as in fact
      results in actual control over the management, business and affairs of an entity
      shall also be deemed to constitute control. The Cleveland Clinic or any related
      entity shall not be considered an Affiliate.

     

    B. “Confidential
      Information” shall mean any (i) information disclosed in writing by a party
      to this Agreement to any other party to this Agreement, and marked by the
      disclosing party as “CONFIDENTIAL” or other similar legend sufficient to
      identify such information as confidential proprietary information of the
      disclosing party, or (ii) information orally disclosed by a party to this
      Agreement to any other party to this Agreement that is identified as
      confidential when disclosed and confirmed in writing as confidential within
      thirty (30) days after such oral disclosure.

     

    C. “Liability”
      shall mean any liabilities, damages, settlements, claims, penalties, fines,
      and
      reasonable costs or reasonable expenses (including, without limitation,
      reasonable attorneys’ fees and other expenses of litigation).

     

    D. “Libraries”
      shall mean the chemical libraries set forth in Appendix A. [Note-Please
      provide a description of the Libraries in
      Appendix A.]

     

    E. “Library
      Information” shall mean all information on the Libraries, including, without
      limitation, (i) information regarding the constituents of the;
      (ii) information sufficient for CBL to use the Libraries, but only as
      prescribed herein; and (iii) information sufficient for CBL to be able to
      identify compounds of interest.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    F. “Optimization
      Project” shall mean the development of a lead compound from a “Confirmed Hit.” A
“Confirmed Hit” shall be a compound that gave a positive response in at least
      two repeat screening assays and that has been confirmed in at least one
      additional functional assay.

     

    Section
      2. Access
      to Libraries.
      

     

    A. Libraries.
      ChemBridge will supply CBL with the Libraries, as set forth in
      Appendix A.

     

    B. Timing.
      ChemBridge will deliver to CBL 30,000 historical compounds and 30,000
      combinatorial Pharmacore compounds from the Libraries set forth in
      Appendix A within 45 days of execution of this Agreement; these
      compounds shall be referred to as the “Initial Compounds”. ChemBridge will
      deliver to CBL another 70,000 historical compounds and another 50,000
      combinatorial Pharmacore compounds from the Libraries set forth in
      Appendix A within 60 days of CBL’s obtaining at least $1,000,000 of equity
      financing at a pre-money valuation of at least $10,000,000; each individual
      compound shall be different from the Initial Compounds and shall be collectively
      referred to as the “Post-investment Compounds”. If CBL shall raise at least
      $1,000,000 of equity financing, but at a pre-money valuation of between
      $5,000,000 and $10,000,000, then ChemBridge shall reduce the number of
      Post-investment Compounds provided to CBL under this agreement as
      follows:

     

    (i) At
      Valuation of $9,000,000: reduce number of compounds by 5%

     

    (ii) At
      Valuation of $8,000,000: reduce number of compounds by 10%

     

    (iii) At
      Valuation of $7,000,000: reduce number of compounds by 15% 

     

    (iv) At
      Valuation of $6,000,000: reduce number of compounds by 20%

     

    (v) At
      Valuation of $5,000,000: reduce number of compounds by 25%

     

    If
      CBL is
      unable to raise at least $1,000,000 at a pre-money valuation of at least
      $5,000,000 within one year of the execution of this Agreement, then CBL shall
      receive no Post-investment Compounds, and the Initial Compounds shall constitute
      Chembridge’s full payment obligation under this Agreement.

     

    C. Information.
      ChemBridge will deliver to CBL the Library Information relevant to the Libraries
      provided according to the schedule defined in Section 2.B
      hereof.

     

    Section
      3. Licenses.

     

    A. License
      to Libraries.
      ChemBridge hereby grants to CBL a non-exclusive, worldwide license, to
      (i) use the Libraries for drug discovery research conducted in its own
      research laboratories and for drug discovery research conducted in
      collaborations, provided that such collaborations meet the criteria,
      qualifications and revenue-sharing obligations as defined in Section 3.B
      hereof, and (ii) any intellectual property that would be infringed by the
      use of the Libraries in accordance with part (i). It is understood and
      agreed that CBL may not, under any circumstances, offer for sale, sell,
      exchange, trade or barter the Libraries. Except as provided for in
      Section 7 below, CBL may not divulge the contents of the Libraries or any
      Library Information to any third party, including its collaborators, without
      the
      express written consent of ChemBridge. CBL has no right to sublicense the
      Libraries, any component of the Libraries or any Library
      Information.

     

    
      
        
        

      

      
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    B. Use
      of
      the Libraries in Contracts with Third Parties.
      While
      CBL does not intend for such work to be its major activity, CBL would like,
      from
      time to time, to use the Libraries in screening contracts with academic
      third-party scientists. ChemBridge agrees that CBL may use the Libraries for
      such contracts with any non-commercial laboratory of the Cleveland Clinic.
      ChemBridge also agrees that CBL may use the Libraries in contracts with up
      to
      seven academic laboratories per year, provided that ChemBridge has given CBL
      prior written approval for each such contract. ChemBridge shall receive from
      CBL
      twenty-five percent (25.0%) of any revenue received by CBL from all contracts,
      except those with the Cleveland Clinic, in which the Libraries are used, such
      revenue to include all forms of payment, real or in kind, including, but not
      limited to, cash, stock, options and warrants. CBL shall provide to ChemBridge
      all financial information necessary for ChemBridge to ascertain the proper
      sums
      due it under this Section 3.B. ChemBridge shall have the right to audit
      once yearly those portions of CBL’s books that pertain to revenue-sharing under
      this Section 3.B. Such audit will be conducted by an accounting firm
      acceptable to CBL, at the reasonable convenience of CBL and at the expense
      of
      ChemBridge, unless the auditor shall find that CBL has underpaid its obligation
      by 5.0% or more, in which case CBL shall bear the cost of the
      audit.

     

    C. Affiliates.
      CBL may
      extend the right and license granted to CBL under Sections 3.A to any
      Affiliate, provided that such Affiliate consents to be bound by the terms of
      this Agreement to the same extent as CBL, and further provided that ChemBridge
      gives written consent, which will not be unreasonably withheld.

     

    D. No
      License of CBL Property.
      No
      rights or licenses with respect to any intellectual property owned by CBL or
      its
      Affiliates are granted or will he deemed granted to ChemBridge under this
      Agreement, except as provided herein under Section 3.B and
      Section 5.A.

     

    Section
      4. Ownership
      and Rights in the Libraries.

     

    A. Independent
      Development
      ChemBridge retains the right to continue independent development and
      investigation of the Libraries. Except as provided for in Section 2.B
      relating to the Libraries to be delivered by ChemBridge and Section 2.C
      relating to the Library Information to be delivered by ChemBridge, CBL has
      no
      rights whatsoever regarding any aspect of Chembridge’s business. Except as
      provided for in Section 2.B relating to the Libraries to be delivered to
      CBL and Section 2.C relating to the Library Information to be delivered to
      CBL, ChemBridge has no obligation whatsoever to provide any information
      concerning any aspect of its business to CBL.

     

    
      
        
        

      

      
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    B. Intellectual
      Property.
      CBL
      shall own all rights to and interest in any idea, invention (whether patentable
      or not), discovery or improvement made by or for CBL and/or its Affiliates
      obtained through use of the Libraries by or for CBL and/or its Affiliates,
      subject to the revenue-sharing obligations defined in Section 3.B and
      Section 5 hereof.

     

    Section
      5. Consideration.

     

    A. Lead
      Optimization.
      in
      consideration of the rights and licenses granted by ChemBridge to CBL under
      this
      Agreement, CBL agrees to collaborate with ChemBridge on two (2)
      Optimization Projects, wherein ChemBridge shall have the responsibility for
      providing the chemistry components of the project and CBL shall have the
      responsibility for providing the pharmacological/biochemical components of
      the
      project, each party to bear the full costs of its responsibilities. CBL shall
      have the responsibility to present for consideration by ChemBridge all its
      data
      on “Confirmed Hits” that have a reasonable possibility of becoming lead
      compounds that arise from its research activities, whether or not such
      activities are conducted with a Collaborator. ChemBridge shall then have 90
      days
      to determine whether it wishes to select the Confirmed Hit as one of its two
      Optimization Projects. ChemBridge shall receive a 50% ownership of the Confirmed
      Hit and all derivative compounds produced during the course of the selected
      Optimization Projects. The parties shall jointly determine which, if any,
      compounds emerging from the Optimization Projects should be taken into further
      development. For such compounds as the parties agree should be taken into
      further development, ChemBridge shall be responsible for the chemistry, and
      CBL
      shall be responsible for the pharmacology/biochemistry necessary for the
      continued development. For later development functions, such as toxicology,
      formulation, pharmacoeconomics, pilot scale manufacturing, clinical trials
      and
      all regulatory and commercial activities, the parties shall share equally in
      the
      cost. Patent costs and related legal expenses shall be borne equally by the
      parties. The parties shall jointly manage the development and commercialization
      of any compound arising from an Optimization Project. CBL will have the right
      to
      define the moment of out-licensing of any compound arising from an Optimization
      Project and the terms and conditions of such out-licensing, if the parties,
      after reasonable discussion and consultation with each other, are not able
      to
      agree on these matters. During the course of an Optimization Project, either
      party may elect at any time not to proceed with the project. If one party elects
      not to proceed with the project, then the other party shall have the right
      to
      purchase the rights of the other at fair market value, lithe parties are unable
      to agree on a fair market value, then such shall be determined by binding
      arbitration.

     

    Section
      6. Representations
      and Warranties.

     

    A. Owner.
      ChemBridge represents and warrants that it is the sole and exclusive owner
      of
      the chemical libraries set forth in Appendix A and has the right to provide
      the Libraries and the Library Information to CBL along with any other rights
      described herein, without violating its obligations to third
      parties.

     

    B. Power
      and Authority.
      Each
      party represents and warrants that it has the legal power, authority and right
      to enter into this Agreement and to perform its respective obligations set
      forth
      herein.

     

    
      
        
        

      

      
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    C. No
      Conflict.
      Each
      party represents and warrants that as of the Effective Date of this Agreement
      it
      is not a party to any agreement or arrangement with any third party or under
      any
      obligation or restriction, including pursuant to its certificate of
      incorporation or bylaws, that in any way limits or conflicts with its ability
      to
      fulfill any of its obligations under this Agreement, and will not enter into
      any
      such agreement during the term of Agreement.

     

    D. Power
      to Grant Rights.
      Each
      party represents and warrants that it has the right to grant the other party
      hereto the rights provided under this Agreement.

     

    Section
      7. Confidentiality.

     

    Both
      parties agree not to use Confidential Information of the other party except
      as
      expressly provided for in this Agreement, and each party will use best efforts
      to prevent the disclosure of the other party’s Confidential Information to third
      parties. Except as may be authorized in advance in writing by the other party,
      each party shall grant access to he Confidential Information only to its own
      employees involved in the use of the rights granted under this Agreement, and
      each party shall require such employees to be bound by this Agreement as well.
      The confidentiality and use obligations set forth above apply to all or any
      part
      of the Confidential Information disclosed hereunder except to the extent
      that:

     

    (i) the
      recipient party can show by written record that it possessed the information
      prior to its receipt from the other party;

     

    (ii) the
      information was already available to the public or became so through no fault
      of
      the recipient party;

     

    (iii) the
      information is received from a third party having no obligation of
      confidentiality to the disclosing party;

     

    (iv) the
      information is developed independently by the recipient party without access
      to
      the disclosing party’s Confidential Information; or

     

    (v) the
      information is required by law or regulation to be disclosed; provided, however,
      that the party subject to such disclosure requirement has provided written
      notice to the other party promptly to enable such other party to seek a
      protective order or otherwise prevent disclosure of such Confidential
      Information.

     

    The
      parties agree to keep the nature, existence and terms of this Agreement
      confidential until first publicly announced by the parties pursuant to a joint
      press release mutually approved by the parties. The content and timing of all
      press releases and similar public communications regarding this Agreement and
      the subject matter hereof will be mutually agreed to in writing by the parties,
      and neither party may make or issue any public announcement or press release
      that refers to the other party or describes any aspect of this Agreement without
      having first received the prior written consent of the other party.
      Notwithstanding the foregoing, either party may make any public announcement
      or
      disclosure that it reasonably believes is required by law, rule or regulation
      of
      any governmental authority or other regulatory body (including, without
      limitation, the SEC or the FDA).

     

    
      
        
        

      

      
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    Notwithstanding
      the provisions of this Section 7, CBL shall have the right to disclose
      Confidential Information to its Affiliates or to collaborators approved under
      the terms of Section 3.B (collectively, “Collaborators”) in accordance with
      this paragraph. Such disclosure shall be limited only to those Collaborators
      involved in the use of the rights granted under this Agreement. Any such
      Collaborators must agree in advance and in writing to be bound by
      confidentiality and non-use obligations substantially similar to those contained
      in this Agreement. In addition, CBL and its Collaborators may disclose such
      Confidential Information of ChemBridge as may be necessary in order to obtain
      or
      maintain any Regulatory Approvals.

     

    Section
      8. Indemnity.

     

    A. CBL
      Indemnity to ChemBridge.
      CBL
      shall indemnify, defend and hold harmless ChemBridge from and against any
      claims, actions or suits by a third party resulting in any Liability arising
      out
      of or resulting from (i) a breach of any representation of CBL in
      Section 6 or (ii) the use of any Library or any other product provided
      by ChemBridge or any affiliate of ChemBridge by CBL and/or its Affiliates and/or
      Collaborators, except to the extent such Liability is proven to have resulted
      directly from the willful negligence or felonious wrongdoing of
      ChemBridge.

     

    B. ChemBridge
      Indemnity to CBL.
      ChemBridge shall indemnify, defend and hold harmless CBL from and against any
      claims, actions or suits by a third party resulting in any Liability arising
      out
      of or resulting from a breach of any representation of ChemBridge in
      Section 6.

     

    Section
      9. Miscellaneous.

     

    A. Governing
      Law.
      This
      Agreement shall be governed, construed, and interpreted in all respects in
      accordance with the laws of the State of Delaware without regard to conflicts
      of
      laws provisions.

     

    B. Venue.
      The
      exclusive venue of any dispute arising out of or in connection with the
      performance or breach of this Agreement shall be the Delaware state courts
      or
      U.S. district court for the County of New Castle, Delaware, and the parties
      hereby consent to the personal jurisdiction of such courts.

     

    C. Assignment;
      Successors.
      This
      Agreement shall not be assignable by either party to any third party without
      the
      written consent of the other party; except either party may assign this
      Agreement, without such consent, to (i) an Affiliate of such party; or
      (ii) an entity that acquires all or substantially all of the business or
      assets of such party, whether by merger, reorganization, acquisition, sale,
      or
      otherwise, which agrees in writing to be bound by the terms and conditions
      of
      this Agreement. The terms and conditions of this Agreement shall be binding
      on
      and inure to the benefit of the permitted successors and assigns of the
      parties.

     

    D. Notice.
      Any
      notice required to be given pursuant to the provisions of this Agreement shall
      be in writing and shall be deemed to have been given at the earlier of the
      time
      when actually received as a consequence of any effective and verifiable method
      of delivery, including, but not limited to, hand delivery, transmission by
      telecopier with return acknowledgement of receipt, or delivery by a professional
      courier service or the time when actually received by certified or registered
      mail addressed to the party for whom intended at the address below or at such
      changed address as the party shall have specified by written notice, provided
      that any notice of change of address shall be effective only upon actual
      receipt.

     

    
      
        
        

      

      
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    (i) If
      from
      CBL to ChemBridge:

     

    Sergey
      Altshtein

    ChemBridge
      Corporation

    16981
      Via Tazon, Suite G

    San Diego,
      CA 92127

    

    (ii) If
      from
      ChemBridge to CBL:

     

    Cleveland
      BioLabs, Inc.

    10265
      Carnegie Avenue

    Cleveland,
      OH 44106

    Attn:
      CEO

    

     

    with
      Copy
      to

     

    Howrey
      Simon Arnold White, LLP

    321
      N. Clark St., Suite 3400

    Chicago,
      IL 60610

    Attn:
      Teddy C. Scott, Jr.

    

    E. Independent
      Contractors.
      The
      relationship of the parties is that of independent contractors. The parties
      are
      not deemed to be agents, partners or joint venture partners of the other for
      any
      purpose as is a result of this Agreement or the transactions contemplated
      hereby.

     

    F. Entire
      Agreement; Amendment.
      This
      Agreement constitutes the entire agreement, both written and oral, with respect
      to the subject matter hereof, and supersedes all prior or contemporaneous
      understandings or agreements, whether written or oral, with respect to such
      subject matter. This Agreement may only be amended in a writing signed by both
      parties.

     

    G. Headings.
      The
      captions to the Sections are not a part of this Agreement, but are included
      merely for convenience of reference and shall not affect its meaning or
      interpretation.

     

    H. Counterparts.
      This
      Agreement may be executed in counterparts, each of which shall be deemed an
      original and which together shall constitute one instrument.

     

    [The
      remainder of this page intentionally left blank]

     

    

    
      
        
        

      

      
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    IN
      WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the
      dates indicated below.

     

    
      	
              CHEMBRIDGE
                CORPORATION:

               

               

               

               

            	 	 	 
	
              By:
                /s/ Eugene
                Vaisberg                               
                

            	 	 	 
	
              Name:
                Eugene
                Vaisberg

              Title:
                Chairman & CEO 

            	 	 	Date: April 27,
              2004
	 	 	 	 
	
              CLEVELAND BIOLABS, INC.:

               

               

               

               

            	 	 	 
	
              By:
                 /s/ Michael
                Fonstein                              
                

              Name:
                Michael Fonstein

              Title:
                CEO

            	 	 	Date: April 27,
              2004
	 	 	 	 
	 	 	 	 

    

     

     

     

    

      [SIGNATURE
        PAGE TO LIBRARY ACCESS AGREEMENT]RESTRICTED
      STOCK AND INVESTOR RIGHTS AGREEMENT

     

    THIS
      RESTRICTED
      STOCK AND INVESTOR RIGHTS AGREEMENT
      (this
“Agreement”)
      is
      made as of April 27, 2004, between Cleveland BioLabs, Inc., a Delaware
      corporation (the “Company”),
      and
      ChemBridge Corporation (“ChemBridge”).

     

    ChemBridge
      has subscribed for and the Company has accepted a subscription agreement
      pursuant to which ChemBridge has committed to purchase, and the Company has
      committed to sell, 600 shares of the Company’s Common Stock, par value
      $0.005 per share (the “Common
      Stock”),
      plus
      such additional shares as may be specified in Section 1(b)
      hereof.
      All of such shares of Common Stock are referred to herein as “ChemBridge
      Shares.”
      Certain definitions are set forth in Section 5
      of this
      Agreement.

     

    The
      Company warrants that its total outstanding equity at the time of this Agreement
      is 10,000 shares of Common Stock, including all warrants, options and rights
      and
      including, at their conversion rate to Common Stock, all preferred stock and
      convertible notes. (Should the Company have more than 10,000 shares
      outstanding at the time of the execution of this Agreement, then the
      aforementioned 600 shares will be increased on a pro
      rata
      basis.)

     

    It
      is the
      intention and expectation of the parties hereto that the Company will raise
      at
      least $1 million at a pre-money
      valuation
      of at
      least $10 million and that, at
      the
      conclusion
      of this
      fund-raising by the Company and the issuance of all shares associated with
      this
      fund-raising, ChemBridge will own 6.0% of the Company’s total outstanding
      equity, including all warrants, options and rights and including, at their
      conversion rate to Common Stock, all preferred stock and convertible notes.
      For
      instance, should the Company issue an additional 1,000 shares of Common
      Stock (or any other obligation convertible to 1,000 shares of Common Stock)
      in the course of raising the aforementioned investment capital, then ChemBridge
      would receive 660 shares of Common Stock instead of the 600 shares
      noted above.

     

    Any
      reference to the “total
      outstanding equity of the Company”
shall
      mean the Company’s total outstanding equity, including all Common Stock and all
      warrants, options and rights and including, at their conversion rate to Common
      Stock, all Preferred Stock and Convertible Notes.

     

    As
      an
      inducement for the Company to issue and sell the ChemBridge Shares to
      ChemBridge, the Company is requiring ChemBridge to enter into this
      Agreement.

     

    The
      parties hereto agree as follows: 

     

    1. ChemBridge
      Shares.

     

    (a) Upon
      execution of this Agreement, ChemBridge will purchase, and the Company will
      sell, 600 shares of Common Stock. If, however, the total outstanding equity
      of
      the Company shall equate to more than 10,000 total shares of Common Stock,
      then the aforementioned 600 shares will be increased on a pro
      rata
      basis
      such that the total shares purchased by ChemBridge shall be 6.0% of the total
      outstanding equity of the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b) Under
      certain circumstances, the Company will award to ChemBridge additional shares
      beyond those defined in Section 1(a).
      It is
      agreed and expected by the parties that the Company will raise at least
      $1 million in equity capital, most likely in the form of Preferred Stock or
      Convertible Notes. Should the Company succeed in raising at least
      $1 million at a premoney
      valuation of at least $10,000,000 and
      without
      the issuance of any additional shares beyond the aforementioned total
      outstanding equity of the Company of 10,000 shares, then the Company will owe
      no
      additional shares to ChemBridge. Should the total outstanding equity of the
      Company, however, up to and including the time when the Company shall complete
      a
      fund-raising of $1 million in equity capital, including the issuance of all
      equity associated with this fund-raising, be more than 10,000 shares or should
      the Company raise equity capital at a pre money valuation of less than
      $10,000,000, then ChemBridge shall be granted additional shares as described
      in
      the following two paragraphs, the effects of these two paragraphs being
additive:

     

    (i) Correction
      for issuance of additional shares.
      If the
      total outstanding equity of the Company shall exceed 10,000 shares at any
      time up to and including the conclusion of the Company’s raising of
      $1 million in equity capital and the issuance of all equity associated with
      this fund-raising, then the number of shares granted to ChemBridge under this
      Agreement shall be increased accordingly. (For instance, if the total
      outstanding equity of the Company totals 20,000 shares, then ChemBridge would
      receive an additional 600 shares of Common Stock);

     

    (ii) Correction
      for reduced pre-money valuation of the Company.
      If the
      Company shall raise equity capital at any time prior to the Company’s receiving
      from ChemBridge the Library compounds contemplated in Section 2
      of the
      attached Library Access Agreement, at a pre-money valuation of the Company
      of
      less than $10,000,000, then the number of ChemBridge shares awarded under this
      Agreement shall be increased by 1.0% for each 2.0% of decreased pre-money
      valuation [for instance, if the equity capital is raised at a pre-money
      valuation of $7,500,000 (a 25 % reduction in valuation), then ChemBridge would
      receive 675 shares (a 12.5% increase), rather than
      600 shares.]

     

    (iii) Paragraphs
      1(b)(i) and 1(b)(ii) are additive.
      For
      instance, if the Company raises $1 million at a pre-money valuation of
      $5,000,000 and, in the course of so doing, issues an additional 5,000 shares
      (for a total of 15,000 shares), then ChemBridge would be granted an
      additional 450 shares [300 shares for the 50% increase in the total
      outstanding equity of the Company plus
      150 shares (a 25% increase) for the 50% decrease in pre-money valuation of
      the Company].

     

    (c) In
      connection with the purchase and sale of the ChemBridge Shares pursuant hereto,
      ChemBridge represents and warrants to the Company that:

     

    (i) ChemBridge
      is sophisticated in financial matters and is able to evaluate the risks and
      benefits of the investment in the ChemBridge Shares;

     

    (ii) This
      Agreement and each of the other agreements contemplated hereby to which
      ChemBridge is a party constitute legal, valid and binding obligations of
      ChemBridge, enforceable in accordance with their terms, and the execution,
      delivery and performance of this Agreement and such other agreements by
      ChemBridge does not and will not conflict with, violate or cause a breach of
      any
      agreement, contract or instrument to which ChemBridge is a party or any
      judgment, order or decree to which ChemBridge is subject; and

     

    
      
        
        

      

      
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    (iii) ChemBridge
      is not a party to or bound by any other noncompete agreement or confidentiality
      agreement which conflicts with the obligations set forth in this
      Agreement.

     

    2. Vesting
      of Shares.
      The
      ChemBridge Shares purchased hereunder shall be fully vested at the time of
      issuance.

     

    3. Restrictions
      on Transfer of ChemBridge Securities.

     

    (a) Transfer
      of ChemBridge Securities.
      ChemBridge shall not Transfer any interest in any ChemBridge Securities, except
      at such time as the restrictions herein terminate as provided in Section
      3(b)
      below.

     

    (b) Termination
      of Restrictions.
      The
      restrictions on the Transfer of ChemBridge Securities set forth in this
Section 3
      will
      continue with respect to each ChemBridge Security until the earlier of
      (i) a Qualified Public Offering; or (ii) a Sale of the
      Company.

     

    4. Additional
      Restrictions on Transfer of ChemBridge Securities.

     

    (a) Legend.
      The
      certificates representing the ChemBridge Securities will bear a legend in
      substantially the following form:

     

    “THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED AS OF
  ,
      2004,
      HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
      “ACT”), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
      REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION
      THEREUNDER. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT
      TO
      ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN
      OTHER AGREEMENTS SET FORTH IN A RESTRICTED STOCK AGREEMENT BETWEEN THE COMPANY
      AND CHEMBRIDGE CORPORATION DATED AS OF _____, 2004. A COPY OF SUCH AGREEMENT
      MAY
      BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANY’S PRINCIPAL PLACE OF BUSINESS
      WITHOUT CHARGE.”

     

    (b) Opinion
      of Counsel.
      No
      holder of ChemBridge Securities may transfer any ChemBridge Securities (except
      pursuant to an effective registration statement under the Securities Act)
      without first delivering to the Company an opinion of counsel (reasonably
      acceptable in form and substance to the Company) that neither registration
      nor
      qualification under the Securities Act and applicable state securities laws
      is
      required in connection with such Transfer.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    5. Definitions.

     

    “ChemBridge
      Securities”
means
      the ChemBridge Shares and any other securities of the Company held by ChemBridge
      or any of ChemBridge’s transferees permitted hereunder. All ChemBridge
      Securities will continue to be ChemBridge Securities in the hands of any holder
      other than ChemBridge (except for the Company and except for transferees in
      a
      Public Sale). Except as otherwise provided herein, each such other holder of
      ChemBridge Securities will succeed to all rights and obligations attributable
      to
      ChemBridge as a holder of ChemBridge Securities hereunder. ChemBridge Securities
      will also include shares of the Company’s capital stock or other securities of
      the Company issued with respect to ChemBridge Securities by way of a stock
      split, dividend or other recapitalization or reclassification.

     

    “Person”
means
      an individual, a partnership, a limited liability company, a corporation, an
      association, a joint stock company, a trust, a joint venture, an unincorporated
      organization and a governmental entity or any department, agency or political
      subdivision thereof.

     

    “Public
      Sale”
means
      any sale pursuant to a registered public offering under the Securities Act
      or
      any sale to the public pursuant to Rule 144 promulgated under the
      Securities Act effected through a broker, dealer or market maker.

     

    “Qualified
      Public Offering”
means
      the sale in an underwritten public offering registered under the Securities
      Act
      of shares of the Company’s Common Stock approved by the Board resulting in net
      proceeds to the Company of no less than $7.5 million.

     

    “Sale
      of the Company”
means
      any transaction or series of transactions pursuant to which (A) any
      Person(s) acquire(s) (i) capital stock of the Company possessing the voting
      power (other than voting rights accruing only in the event of a default, breach
      or event of noncompliance) to elect a majority of the Company’s board of
      directors (whether by merger, consolidation, reorganization, combination, sale
      or transfer of the Company’s capital stock, shareholder or voting agreement,
      proxy, power of attorney or otherwise) or (ii) all or substantially all of
      the Company’s assets determined on a consolidated basis; provided
      that the
      term “Sale of the Company” shall not include any sale of equity or debt
      securities by the Company in a private offering to other investors; or
      (B) more than 50% of the assets of the Company is spun off, split off or
      otherwise distributed.

     

    “Securities
      Act”
means
      the Securities Act of 1933, as amended.

     

    “Transfer”
means
      to sell, transfer, assign, pledge or otherwise dispose of (whether with or
      without consideration and whether voluntarily or involuntarily or by operation
      of law).

     

    6. Seniority
      of ChemBridge Shares and Registration Rights.
      All of
      the shares issued to ChemBridge hereunder, including those shares resulting
      from
      the exercise of warrants, shall have liquidation seniority and registration
      preferences at least as favorable as those of any of the shares held now or
      in
      the future by any of the current shareholders of the Company. ChemBridge,
      moreover, shall have the right to participate on a pro
      rata
      basis
      with any current shareholder of the Company in any sale or exchange of any
      of
      the shares possessed now or in the future by any current shareholder of the
      Company.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    7. Anti-dilution
      Provision.
      ChemBridge shall have the right to purchase, at the lowest price offered to
      any
      other entity or individual, a percentage of any new equity issued by the
      Company, any successor company or affiliate, such percentage to be up to that
      percentage of issued equity of the Company which ChemBridge, at the time
      ChemBridge shall make such purchase, shall own under Sections 1
      and
2
      of this
      Agreement and including, in addition, any exercised warrants or other stock
      which ChemBridge shall own in the Company. ChemBridge’s rights under this
Section 7
      shall
      survive termination of this Agreement and shall continue until ChemBridge has
      disposed of its entire equity interest in the Company and its successor
      companies

     

    8. Down-round
      Protection of ChemBridge.
      Section 1(b)
      provides
      for protection of ChemBridge in the event that the first $1 million of
      equity capital raised by the Company shall be raised at a pre-money valuation
      of
      less than $10,000, in which case the number of compounds given to the Company
      under a certain Library Access Agreement would be decreased and the number
      of
      shares of the Company’s Common Stock granted to ChemBridge would be increased.
      Should the Company, subsequent to its raising the first $1 million in
      equity capital, raise any additional equity capital at a pre-money valuation
      of
      less than $10,000,000, then the total number of shares owned by ChemBridge
      would
      be increased on a pro
      rata
      basis.
      (For instance, if ChemBridge owns 600 shares of the Company’s stock and the
      Company raises capital at a pre-money valuation of only $5,000,000, then
      ChemBridge will be granted an additional 600 shares.)

     

    9. Financial
      Statements.
      Once
      per year, on the anniversary of this Agreement, the Company will provide to
      ChemBridge a complete set of the Company’s financial statements. At such time as
      the Company shall obtain audited financial statements, the Company will provide
      to ChemBridge annually a complete copy of these audited financial statements
      with 30 days of their receipt by the Company, these audited financial statements
      to be in lieu of those defined in the first sentence of this
      paragraph.

     

    10. ChemBridge
      Representation on the Company’s Board of Directors.
      Associated with this Agreement is another agreement between the parties entitled
      “Warrant to Purchase Common Stock,” which agreement provides to ChemBridge a
      right to purchase additional shares of the Company’s Common Stock. At such time
      as ChemBridge shall elect to exercise all the warrants provided in the Warrant
      to Purchase Common Stock, ChemBridge shall gain the right to appoint a member
      of
      the Company’s Board of Directors, and this right shall continue until such time
      as ChemBridge has disposed of more than fifty percent of its holdings of the
      Company’s equity, or the Company shall make a Qualified Public Offering or there
      shall be a Sale of the Company. ChemBridge, at its sole election, in lieu of
      appointing a member of the Company’s Board of Directors, shall have the right to
      send a representative to each and every meeting of the Company’s Board of
      Directors, and the Company shall have the affirmative obligation to provide
      to
      ChemBridge Notice of any such meeting.

     

    11. Notice
      to ChemBridge of the Company’s Financial Transactions.
      The
      Company shall have the affirmative obligation to inform ChemBridge of each
      and
      every transaction that has a total value in excess of $250,000.00 to which
      the
      Company is a party. Such notice shall be provided to ChemBridge within thirty
      days of the completion of the transaction, and, upon the Company’s request to
      ChemBridge, ChemBridge shall hold in confidence its knowledge of the
      transaction.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    12. Notices.
      Any
      notice provided for in this Agreement must be in writing and must be either
      personally delivered, mailed by first class mail (postage prepaid and return
      receipt requested), sent by reputable overnight courier service (charges
      prepaid), or sent via facsimile to the recipient at the address or facsimile
      number below indicated:

     

    
      	
              If
                to the Company:

               

              Cleveland
                BioLabs,
                Inc.

              7800
                Blackberry Lane

              Gates
                Mills, Ohio
                44040

              Attn: Michael
                Fonstein

            
	
               

              With
                a copy to:

               

              Katten
                Muchin Rosenman
                LLP

              525
                West Monroe
                Street

              Suite
                1900

              Chicago,
                Illinois
                60661

              Fax: (312)
                902-1061

              Tel: (312)
                902-6200

              Attn: Kurt
                W. Florian,
                Esq.

            
	
               

              If
                to CamBridge:

               

              ChemBridge
                Corporation

              16981
                Via Tazon

              San
                Diego, California
                92127

              Attn: Mr.
                Sergey
                Altshteyn

            

    

    

    or
      such
      other address, facsimile number or to the attention of such other person as
      the
      recipient party shall have specified by prior written notice to the sending
      party. Any notice under this Agreement will be deemed to have been given when
      so
      delivered, sent or transmitted or, if mailed, five days after deposit in the
      U.S. mail.

     

    13. General
      Provisions.

     

    (a) Transfers
      in Violation of Agreement.
      Any
      Transfer or attempted Transfer of any ChemBridge Securities in violation of
      any
      provision of this Agreement shall be void, and the Company shall not record
      such
      Transfer on its books or treat any purported transferee of such ChemBridge
      Securities as the owner of such securities for any purpose.

     

    (b) Severability.
      Whenever possible, each provision of this Agreement will be interpreted in
      such
      manner as to be effective and valid under applicable law, but if any provision
      of this Agreement 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 will not affect any other provision or any other
      jurisdiction, but this Agreement will be reformed, construed and enforced in
      such jurisdiction as if such invalid, illegal or unenforceable provision had
      never been contained herein.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    (c) Complete
      Agreement.
      This
      Agreement, those documents expressly referred to herein and other documents
      of
      even date herewith embody the complete agreement and understanding among the
      parties and supersede and preempt any prior understandings, agreements or
      representations by or among the parties, written or oral, which may have related
      to the subject matter hereof in any way.

     

    (d) Counterparts.
      This
      Agreement may be executed in separate counterparts, each of which is deemed
      to
      be an original and all of which taken together constitute one and the same
      agreement.

     

    (e) Successors
      and Assigns.
      Except
      as otherwise provided herein, this Agreement shall bind and inure to the benefit
      of and be enforceable by ChemBridge and the Company and their respective
      successors and assigns (including subsequent holders of ChemBridge Securities),
      provided that the rights and obligations of ChemBridge under this Agreement
      shall not be assignable except in connection with a permitted transfer of
      ChemBridge Securities hereunder.

     

    (f) Choice
      of Law.
      This
      Agreement shall be construed in accordance with the laws of the State of
      Delaware, without regard to principals of conflicts of law. Any and all
      litigation arising out of this Agreement shall be conducted only in courts
      located in the State of Delaware.

     

    (g) Remedies.
      Each of
      the parties to this Agreement will be entitled to enforce its rights under
      this
      Agreement specifically, to recover damages and costs (including attorney’s fees)
      caused by any breach of any provision of this Agreement and to exercise all
      other rights existing in its favor. The parties hereto agree and acknowledge
      that money damages may not be an adequate remedy for any breach of the
      provisions of this Agreement and that any party may in its sole discretion
      apply
      to any court of law or equity of competent jurisdiction (without posting any
      bond or deposit) for specific performance and/or other injunctive relief in
      order to enforce or prevent any violations of the provisions of this
      Agreement.

     

    (h) Amendment
      and Waiver.
      The
      provisions of this Agreement may be amended and waived only with the prior
      written consent of the Company and ChemBridge. No course of conduct or failure
      or delay in enforcing the provisions of this Agreement shall affect the
      validity, binding effect or enforceability of this Agreement.

     

    (i) Business
      Days.
      If any
      time period for giving notice or taking action hereunder expires on a day which
      is a Saturday, Sunday or holiday in the state in which the Company’s chief
      executive office is located, the time period shall be automatically extended
      to
      the business day immediately following such Saturday, Sunday or
      holiday.

     

    (j) Indemnification
      and Reimbursement of Payments on Behalf of ChemBridge.
      The
      Company shall be entitled to deduct or withhold from any amounts owing from
      the
      Company to ChemBridge any federal, state, local or foreign withholding taxes,
      or
      excise taxes (“Taxes”)
      imposed with respect to ChemBridge’s ownership interest in the
      Company.

     

    (k) Generally
      Accepted Accounting Principles; Adjustments of Numbers.
      Where
      any accounting determination or calculation is required to be made under this
      Agreement or the exhibits hereto, such determination or calculation (unless
      otherwise provided) shall be made in accordance with generally accepted
      accounting principles, consistently applied. All numbers set forth herein which
      refer to share prices or amounts will be appropriately adjusted to reflect
      stock
      splits, stock dividends, combinations of shares, recapitalizations or other
      similar transactions affecting the subject class of stock.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    (l) Waiver
      of Jury Trial.
      Each of
      the parties hereto hereby irrevocably waives any and all right to trial by
      jury
      of any claim or cause of action in any legal proceeding arising out of or
      related to this Agreement or the transactions or events contemplated hereby
      or
      any course of conduct, course of dealing, statements (whether verbal or written)
      or actions of any party hereto, The parties hereto each agree that any and
      all
      such claims and causes of action shall be tried by a court trial without a
      jury.
      Each of the parties hereto further waives any right to seek to consolidate
      any
      such legal proceeding in which a jury trial has been waived with any other
      legal
      proceeding in which a jury trial cannot or has not been waived.

     

    (m) Conflict
      Between Agreements.
      In
      association with this Agreement, the parties have executed four other
      agreements. Should any of the terms of this Agreement conflict with any of
      the
      terms of any of the other agreements between the parties, then the terms of
      this
      Agreement shall prevail.

     

    *****

     

     

     

    
 

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

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

     

    CLEVELAND
      BIOLABS, INC.

    

    

    By: /s/Michael
      Fonstein                                                  

    Name: Michael
      Fonstein

    Its: CEO

    

    

    

    CHEMBRIDGE
      CORPORATION

    

    

    By: /s/
      Eugene
      Vaisberg                                                 

    Name: Eugene
      Vaisberg

    Its: CEO    

     

     

    
      
        
        

      

      
        9

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