Contract analysis

Section 1.1 — Definitions As used in this Agreement, the following terms shall have the meanings set forth below: "Affiliate" means, with respect to any Person, any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control" (including the terms "controlling," "controlled by," and "un

Section 1.2 — Rules of Construction Unless the context of this Agreement otherwise requires: (a) words of any gender include each other gender; (b) words using the singular or plural number also include the plural or singular number, respectively; (c) the terms "hereof," "herein," "hereby," "hereto," and derivative or similar words refer to this entire Agreement; (d) the terms "Article," "Section," "Exhibit," and "Sc

ARTICLE II — CONTINGENT VALUE RIGHTS

Section 2.1 — Issuance of CVRs (a) At the Effective Time, Penterra shall cause to be issued one (1) CVR for each share of Caliston common stock outstanding immediately prior to the Effective Time. Each CVR shall represent the contractual right of the applicable Holder to receive its Pro Rata Share of the CVR Payment Amount upon the achievement of the Milestone, subject to the terms and conditions of this Agreement. (

Section 2.2 — Non-Transferability of CVRs (a) The CVRs shall not be sold, assigned, transferred, pledged, encumbered, or otherwise disposed of, whether voluntarily or involuntarily, by any Holder, except as follows: (i) by operation of law (including by reason of the death of a Holder who is a natural person, or the merger, consolidation, dissolution, or liquidation of a Holder that is an entity); (ii) by will or the

Section 2.3 — No Voting or Dividend Rights (a) The CVRs shall not confer upon any Holder any voting rights with respect to any matter submitted to a vote of the stockholders of Penterra, and no Holder shall have any right to attend or participate in any meeting of the stockholders of Penterra by reason of holding CVRs. (b) The CVRs shall not entitle any Holder to receive any dividends or other distributions from Pent

Section 2.4 — CVR Register (a) The Trustee shall establish and maintain a register (the "CVR Register") setting forth the name, address, number of CVRs, Pro Rata Share (expressed as a percentage), and wire transfer instructions (if provided) of each Holder. The form of the CVR Register is attached hereto as Exhibit A. (b) The initial CVR Register shall be established based on the register of stockholders of Caliston

Section 2.5 — No Interest No interest shall accrue or be payable on the CVR Payment Amount, or any portion thereof, at any time, whether before or after the Milestone Achievement Date, and whether or not payment is delayed for any reason. For the avoidance of doubt, no Holder shall be entitled to any form of time value of money, interest, yield, or similar payment in connection with the CVRs.

ARTICLE III — MILESTONE AND PAYMENT MECHANICS

Section 3.1 — Milestone Definition and Achievement (a) The Milestone. The Milestone shall be deemed to have been achieved if and only if FDA Approval of CLT-4019 is obtained on or before December 31, 2026 (the "Milestone Deadline"). For purposes of determining whether the Milestone has been achieved, the date of FDA Approval shall be the date set forth on the FDA approval letter. If the date of the FDA approval lette

Section 3.2 — Payment Upon Milestone Achievement (a) CVR Payment. Within thirty (30) Business Days following the Milestone Achievement Date (such date of payment, the "CVR Payment Date"), Penterra shall deposit or cause to be deposited with the Trustee the full CVR Payment Amount of One Hundred Twenty-Five Million Dollars ($125,000,000) in immediately available funds by wire transfer to an account designated by the T

Section 3.3 — Expiration of CVRs (a) Milestone Failure. If the Milestone is not achieved on or before December 31, 2026, the CVRs shall automatically and without any action by any party expire and shall be of no further force or effect. Upon such expiration, no payment shall be due from Penterra or any other Person to any Holder in respect of the CVRs, and neither Penterra nor the Trustee shall have any further oblig

Section 3.4 — Undeliverable Payments (a) If any distribution of the CVR Payment Amount to a Holder is returned to the Trustee as undeliverable (whether by reason of an incorrect address, uncashed check, or otherwise), the Trustee shall hold such amount in a non-interest-bearing account (or, if required by applicable law, in an interest-bearing account, with any interest accruing for the benefit of Penterra) until cla

ARTICLE IV — COVENANTS OF PENTERRA

Section 4.1 — Diligent Efforts to Achieve Milestone (a) Obligation. Penterra shall use Diligent Efforts, from and after the Effective Time, to achieve the Milestone on or before the Milestone Deadline, including by pursuing the continued development, clinical testing, manufacturing, and regulatory pursuit of CLT-4019 in accordance with this Article IV. Penterra acknowledges that the Holders are relying on Penterra's

Section 4.2 — Clinical and Regulatory Updates (a) Quarterly Reports. Penterra shall provide the Trustee and the Stockholder Representative with written quarterly reports on the status of the development of CLT-4019. Each quarterly report shall include, to the extent reasonably available and to the extent not prohibited by applicable law, confidentiality obligations, or regulatory restrictions: (i) a summary of clinic

Section 4.3 — Restrictions on Penterra (a) No Disposition. Penterra shall not sell, license, assign, or otherwise dispose of all or substantially all of the rights to CLT-4019 (including intellectual property rights, regulatory filings, and clinical data) to any third party unless, as a condition to such sale, license, assignment, or disposition, such third party (or, in the case of a license, the licensee) assumes i

Section 4.4 — Financing of Development Penterra represents and warrants to the Trustee and the Holders (as of the Effective Date) that it has adequate financial resources to fund the continued development of CLT-4019 through the filing of a New Drug Application and completion of the FDA review process. As of the Effective Date, Penterra has cash and cash equivalents of approximately Eight Hundred Ninety-Two Million D

Section 4.5 — Insurance Penterra shall maintain, from and after the Effective Time through the earlier of (a) the achievement of the Milestone and the distribution of the CVR Payment Amount in full and (b) the expiration of the CVRs, product liability and clinical trial liability insurance with respect to CLT-4019 with coverage limits and terms consistent with the industry practice of similarly situated specialty pha

Section 5.1 — Appointment Penterra hereby appoints Columnar Trust Services, Inc. as Trustee under this Agreement, and the Trustee hereby accepts such appointment and agrees to perform its duties and obligations as set forth herein. The Trustee shall act as trustee on behalf of, and for the benefit of, the Holders in accordance with the terms and conditions of this Agreement.

Section 5.2 — Duties and Responsibilities (a) The Trustee shall perform the following duties and responsibilities in connection with this Agreement: (i) establish and maintain the CVR Register in accordance with Section 2.4; (ii) receive the CVR Payment Amount from Penterra and distribute the CVR Payment Amount to the Holders in accordance with Article III; (iii) receive notices, reports, communications, and other do

Section 5.3 — Standard of Care; Limitation of Liability (a) The Trustee shall exercise, in the performance of its duties hereunder, the standard of care that a reasonably prudent trustee would exercise under the circumstances, taking into account the ministerial nature of the Trustee's role under this Agreement. (b) The Trustee shall not be liable for any loss, claim, damage, liability, cost, or expense arising out o

Section 5.4 — Compensation and Expenses (a) Penterra shall pay the Trustee a reasonable fee for the Trustee's services hereunder, as agreed in writing between Penterra and the Trustee in a separate fee schedule entered into on or about the date hereof. In the absence of a separate fee schedule, the Trustee shall be entitled to reasonable compensation for its services hereunder consistent with the fees customarily cha

Section 5.5 — Indemnification of Trustee (a) Penterra shall indemnify, defend, and hold harmless the Trustee and its officers, directors, employees, agents, and representatives (each, a "Trustee Indemnitee") from and against any and all losses, claims, damages, liabilities, costs, and expenses (including reasonable and documented attorneys' fees and disbursements) arising out of or relating to the Trustee's acceptanc

Section 5.6 — Resignation and Removal (a) Resignation. The Trustee may resign at any time by giving not less than sixty (60) days' prior written notice to Penterra and the Stockholder Representative. Such resignation shall take effect upon the appointment of a successor trustee in accordance with Section 5.6(c) and the acceptance by such successor trustee of the appointment. (b) Removal. The Trustee may be removed by

ARTICLE VI — ROLE OF THE STOCKHOLDER REPRESENTATIVE

Section 6.1 — Appointment and Authority (a) Ridgeline Ventures, LP (Ava Lindström, Managing Partner) has been irrevocably designated and appointed as the Stockholder Representative for the Holders pursuant to the Stockholder Representative Agreement dated November 27, 2023. The Stockholder Representative shall act as the exclusive representative of the Holders for all purposes under this Agreement. (b) Without limiti

Section 6.2 — Reliance on Stockholder Representative Penterra and the Trustee shall be entitled to deal exclusively with the Stockholder Representative on all matters relating to this Agreement and shall not be required to deal directly with any Holder. Penterra and the Trustee may conclusively rely on any notice, instruction, consent, direction, communication, or other action taken by the Stockholder Representative

Section 6.3 — Exculpation and Indemnification (a) The Stockholder Representative shall not be liable to any Holder for any action taken or omitted to be taken in good faith in its capacity as Stockholder Representative under this Agreement, including any action taken or omitted in reliance upon the advice of legal counsel, accountants, or other professional advisors. The Stockholder Representative shall not be liable

ARTICLE VII — DISPUTE RESOLUTION

Section 7.1 — Good Faith Negotiation In the event of any dispute, controversy, or claim arising out of or relating to this Agreement, or the breach, termination, or validity thereof (including any dispute regarding whether Penterra has satisfied its Diligent Efforts obligations under Article IV, whether the Milestone has been achieved, or the interpretation or enforcement of any provision of this Agreement) (a "Dispu

Section 7.2 — Expert Determination (Scientific/Regulatory Disputes) (a) If any Dispute relates primarily to scientific, clinical, or regulatory matters (including whether the development of CLT-4019 has been pursued with Diligent Efforts, whether a particular clinical or regulatory decision was consistent with the Diligent Efforts standard, or whether a particular FDA action constitutes FDA Approval) (a "Scientific D

Section 7.3 — Litigation; Consent to Jurisdiction (a) For all Disputes that are not resolved pursuant to Section 7.1 or Section 7.2, or for Disputes that do not qualify as Scientific Disputes under Section 7.2, any party (including the Stockholder Representative, on behalf of the Holders) may commence an action or proceeding in the Court of Chancery of the State of Delaware (or, if the Court of Chancery of the State