Contract analysis

I. Introduction and Deposition Overview This memorandum summarizes the deposition testimony of Donald R. Farnham, the Managing Member and Chief Executive Officer of Vantage Medical Distribution, LLC ("Vantage"), taken on Monday, October 18, 2021. The deposition was conducted at the offices of Calderwood & Harkness LLP, 1 Federal Street, 35th Floor, Boston, Massachusetts 02110, pursuant to a notice of deposition serve

II. Summary of Key Testimony — Background and Role Mr. Farnham confirmed on the record that he is the sole founder, Managing Member, and Chief Executive Officer of Vantage Medical Distribution, LLC, a Massachusetts limited liability company with its principal place of business at 75 Cabot Road, Suite 310, Medford, Massachusetts 02155. He testified that he founded Vantage in 2009. Prior to founding Vantage, Farnham te

III. Summary of Key Testimony — Understanding of the Exclusive Distribution Agreement A. Execution and Terms of the EDA Mr. Farnham confirmed that the Exclusive Distribution Agreement was executed effective July 1, 2017, between Penterra Pharmaceuticals Corp., identified in the agreement as "Supplier," and Vantage Medical Distribution, LLC, identified as "Distributor." The EDA was marked as Exhibit 1 to the depositio

IV. Summary of Key Testimony — The January 12, 2018 Kapoor Email A substantial portion of the deposition was devoted to questioning Mr. Farnham about the January 12, 2018 email from Steven Kapoor to Donald Farnham, which was marked as Exhibit 7 to the deposition. This email is the central document in Vantage's defense and is the only written communication that Farnham could identify as supporting his claim that Pente

1. Exploratory Language. Farnham acknowledged that the email uses the phrase "open to exploring expansion" rather than language granting consent, authorization, or approval. When asked whether "open to exploring" is the same as "authorized to proceed," Farnham conceded that the two phrases "have different meanings" but maintained that, in context, the email conveyed Penterra's intent to support expansion.

2. Condition Precedent. Farnham acknowledged that the email conditions any expansion on Vantage's New England footprint being "fully ramped." When asked what "fully ramped" meant and whether that condition had been satisfied as of any particular date, Farnham's answer was vague. He testified that he believed Vantage's New England operations were "substantially ramped" by mid-2019 but could not identify a specific dat

3. Further Discussion Required. Farnham acknowledged that the email's instruction to "circle back mid-year and see where things stand" suggested that further discussion and evaluation were needed before any expansion could proceed. He agreed that the phrase "see where things stand" implies that a decision had not yet been made.

4. No Express Written Authorization. Key Admission: Farnham acknowledged that no Penterra officer expressly authorized tri-state shipments in writing — neither in the Kapoor Email nor in any other document that Farnham could identify during the deposition. When asked point-blank, "Can you identify any document in which a Penterra representative states, in substance, 'Vantage is authorized to distribute Penterra produ

5. Failure to Follow Up. Farnham admitted that he did not "circle back" with Mr. Kapoor at mid-year 2018 — or at any subsequent time — to formalize the expansion that the Kapoor Email contemplated. He testified that "things got busy" and that the follow-up "fell through the cracks." This admission is significant because it demonstrates that even the preliminary steps contemplated by the Kapoor Email were never comple

6. No Written Follow-Up. Farnham confirmed that there is no written follow-up to the Kapoor Email — from either party — in which Penterra confirmed authorization for tri-state distribution. He could not produce any responsive email, letter, memorandum, or other document reflecting that the mid-year check-in proposed by Mr. Kapoor ever occurred or that any determination was made that Vantage's New England footprint wa

7. Section 13.1 Compliance. When asked whether the Kapoor Email constituted the "written instrument signed by both parties" required under Section 13.1 for any amendment to the EDA, Farnham conceded that the email was signed (or sent) only by Mr. Kapoor on behalf of Penterra and was not countersigned or otherwise acknowledged in writing by Vantage. He further conceded that the email is not styled as a contract amendm

V. Summary of Key Testimony — Commencement of Tri-State Shipments Mr. Farnham confirmed that Vantage began shipping Oncalaris® to hospitals and oncology clinics in New York, New Jersey, and Pennsylvania on or about September 14, 2020. He identified this date based on Vantage's internal records and testimony from his recollection. He acknowledged that these shipments were the first systematic, large-scale distribution

VI. Summary of Key Testimony — Course of Dealing / Alleged Acquiescence Mr. Farnham devoted significant testimony to what he characterized as Penterra's acquiescence in and tacit approval of Vantage's tri-state distribution activities. This theory — that Penterra's failure to object to Vantage's shipments constituted a modification of the Territory by course of dealing — is central to Vantage's defense and countercla

VII. Summary of Key Testimony — Vantage's Response and Counterclaim Damages Farnham confirmed that upon receiving the March 8, 2021 cease-and-desist letter from Penterra's General Counsel, Vantage retained Hargrove, Sinclair & Polk LLP to represent it in the dispute. He identified Kenneth M. Rourke as the lead attorney responsible for the matter. Mr. Rourke, on behalf of Vantage, sent a response letter dated March 22

VIII. Summary of Key Testimony — Knowledge of Meridian National Distributors, Inc. Mr. Farnham was asked about his awareness of Penterra's relationship with Meridian National Distributors, Inc. ("Meridian"), a pharmaceutical distribution company with offices at 520 Seventh Avenue, 12th Floor, New York, New York 10018. Farnham testified that he first learned of Penterra's negotiations with Meridian to distribute Oncal

IX. Assessment of Farnham's Credibility and Testimony Overall, Mr. Farnham presented as a knowledgeable and confident witness. He was generally responsive to questions, maintained composure under sustained cross-examination, and demonstrated a thorough understanding of Vantage's business operations, the pharmaceutical distribution industry, and the commercial importance of the Penterra relationship. He was clearly we

1. Reliance on the Kapoor Email. Farnham's characterization of the January 12, 2018 email as a "green light" for tri-state expansion is unsupported by the text of the email itself. As established through his own admissions: (a) The email uses tentative, exploratory language ("open to exploring expansion") rather than language of authorization or consent; (b) Farnham conceded that no follow-up discussion or formalizat

2. Course-of-Dealing Argument. Farnham's theory that Penterra acquiesced in the tri-state expansion through its failure to object is undercut by several factors: (a) Farnham could not provide specifics — including dates, invoice numbers, or customer identities — regarding the alleged "late 2019" shipments to New York that he referenced during the deposition; (b) The window of alleged acquiescence — approximately six

3. Damages Testimony. Farnham's testimony regarding the $35 million counterclaim damages figure was conspicuously vague. He could not provide a breakdown of the calculation, could not articulate the assumptions underlying the figure, and repeatedly deferred to Vantage's outside accountants. The only concrete figure he could point to — $6.4 million in actual tri-state revenues over six months — does not, on its face,

4. Integration and Amendment Clauses. Farnham's testimony regarding Section 14.8 (integration clause) and Section 13.1 (amendment requirement) essentially constituted an acknowledgment that the contractual formalities required by the EDA were not followed. His position — that the parties' course of dealing overrode the written agreement — is a legal conclusion for which he provided no factual foundation, and one that

X. Key Admissions — Summary for Motion Practice The following is a consolidated list of Mr. Farnham's critical admissions during the October 18, 2021 deposition, organized for ease of reference in the preparation of Penterra's anticipated motion for summary judgment, currently scheduled for filing on February 11, 2022:

1. Territory Definition. Exhibit A to the EDA lists only the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont as the Territory. Exhibit A does not include New York, New Jersey, or Pennsylvania. Farnham confirmed this on the record.

2. No Signed Amendment to Exhibit A. Farnham admitted that he did not obtain a signed amendment to Exhibit A expanding the Territory to include New York, New Jersey, or Pennsylvania. No such amendment exists.

3. No Written Instrument Signed by Both Parties. Farnham admitted that he did not obtain any written instrument signed by both Penterra and Vantage amending the EDA in any respect relevant to the Territory definition, as required by Section 13.1 of the agreement.

4. No Express Written Authorization. No Penterra officer expressly authorized Vantage to distribute Penterra products in the tri-state area in writing. Farnham confirmed this and could not identify any document containing such authorization.

5. Kapoor Email — Exploratory Language. The January 12, 2018 email from Steven Kapoor uses the phrase "open to exploring expansion," which Farnham acknowledged is different from an authorization or grant of consent. The email is not styled as a contract amendment, does not reference the EDA by name, and does not reference Exhibit A.

6. No Mid-Year 2018 Follow-Up. Farnham admitted that he did not follow up with Mr. Kapoor at mid-year 2018 or at any subsequent time to formalize the expansion contemplated by the Kapoor Email, despite the email's express instruction to "circle back mid-year."

7. No Written Notice Before Tri-State Shipments. Vantage did not notify Penterra in writing before commencing tri-state shipments on or about September 14, 2020. Farnham confirmed this.

8. No Documentary Evidence of Penterra's Knowledge or Acquiescence. Farnham could not identify specific documentary evidence — including emails, letters, notes, or other writings — establishing that Penterra knew about or acquiesced in Vantage's tri-state distribution activities prior to the March 8, 2021 cease-and-desist letter.

9. Unsupported Damages Figure. The $35 million damages figure asserted in Vantage's counterclaim lacks detailed calculation support in Farnham's deposition testimony. The only concrete revenue figure Farnham could cite was $6.4 million in actual tri-state revenues over approximately six months, and he could not articulate how that figure supported a $35 million claim. These admissions, taken together, establish that

XI. Recommended Follow-Up Actions Based on Mr. Farnham's deposition testimony, the following follow-up actions are recommended:

1. Cross-Reference "Late 2019" Shipment Claim. Farnham's reference to "late 2019" shipments to New York should be tested against Vantage's sales and shipping records produced in discovery. Review all invoices, bills of lading, shipping manifests, and customer orders from Vantage's production to determine whether any Penterra product shipments were made to New York, New Jersey, or Pennsylvania before September 14, 202

2. Prepare Deposition of Brian Kopec (Scheduled December 7, 2021). Kopec is Vantage's Outside Sales Director and, according to Farnham, the individual who developed the customer relationships in the tri-state area and presented the business case for expansion. His deposition should probe the specific timeline and circumstances of the tri-state sales initiative, including when customer outreach began, which customers

3. Prepare Steven Kapoor (Deposition Scheduled November 2, 2021). Kapoor is the author of the January 12, 2018 email and is the most important witness from Penterra's perspective on the question of what the email was intended to communicate. He should be prepared to testify consistently with Penterra's position — namely, that the email expressed a willingness to explore future expansion but did not constitute written

4. Prepare Rachel Mendez (Deposition Scheduled November 19, 2021). Mendez, as Director of Distribution & Logistics, should be prepared to testify about Penterra's distribution logistics systems and order management processes. Specifically, she should address whether Penterra's systems would have flagged or detected Vantage orders with delivery addresses outside the six New England states, and whether any such anomali

5. Damages discovery — Cranmer, Hodges & Associates, P.C. Issue a subpoena to or request production from Cranmer, Hodges & Associates, P.C. (Medford, MA) for any damages analysis, financial projections, or work papers underlying Vantage's $35 million counterclaim figure, if such documents have not already been produced in response to prior discovery requests. Review Vantage's document production to confirm the comple

6. Begin Drafting Summary Judgment Materials. Begin preparing Penterra's motion for summary judgment, incorporating Farnham's key admissions as set forth in Section X above. The motion should focus on the unambiguous language of Exhibit A, the failure to satisfy Section 2.3's prior written consent requirement, the failure to satisfy Section 13.1's amendment requirement, the insufficiency of the Kapoor Email as a matt

XII. Exhibits Referenced During Deposition The following deposition exhibits are referenced in this memorandum and were marked during the October 18, 2021 deposition of Donald R. Farnham: Additional exhibits were marked and used during the deposition. A complete exhibit list will be compiled upon receipt of the certified transcript, which is expected within approximately ten business days. All deposition exhibits sho