Contract analysis

1. My name is Steven Kapoor. I am an adult over the age of eighteen, and I reside in Mercer County, New Jersey. I am currently employed as Vice President, Commercial Operations, of Penterra Pharmaceuticals Corp. ("Penterra" or the "Company"), a Delaware corporation publicly traded on the Nasdaq Stock Market under the ticker symbol "PTRA," with its principal offices located at 400 Carnegie Center Drive, Suite 600, Pri

2. In my capacity as Vice President, Commercial Operations, I am directly responsible for managing Penterra's relationships with its network of regional exclusive distributors and national specialty pharmacy partners throughout the United States. My role involves direct supervisory involvement in the negotiation, drafting, execution, and ongoing administration of distribution agreements between Penterra and its distr

3. I personally participated in the negotiation and execution of the Exclusive Distribution Agreement dated July 1, 2017, between Penterra, as "Supplier," and Vantage Medical Distribution, LLC, as "Distributor" (the "EDA" or the "Agreement"). The EDA governs the distribution of two of Penterra's commercially marketed pharmaceutical products: (a) Oncalaris® (pegvisomant-axel), available in 20 mg and 40 mg vials for in

4. Section 2.1 of the EDA grants Vantage "the exclusive right to distribute the Products within the Territory, as defined in Exhibit A." Exhibit A to the EDA defines the "Territory" as follows: "The states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont (collectively, the 'New England States')." I attest that during the negotiation of the EDA, the parties specifically discussed and agre

5. Section 2.3 of the EDA provides, in relevant part, as follows: "Distributor shall not actively solicit orders for, or deliver, the Products outside the Territory without Supplier's prior written consent." I understood this provision, at the time of the EDA's execution and at all times thereafter, to mean that Vantage was contractually prohibited from distributing, selling, or delivering any Penterra products — inc

6. Section 13.1 of the EDA provides as follows: "No amendment, modification, or waiver of any provision of this Agreement shall be effective unless set forth in a written instrument signed by both parties." I understood this provision, and continue to understand this provision, to require that any change to any term of the EDA — including, without limitation, any change to the definition of the Territory set forth in

7. Section 14.8 of the EDA provides, in relevant part, that the Agreement, including all Exhibits attached thereto, constitutes the entire agreement between the parties with respect to the subject matter thereof and supersedes all prior negotiations, representations, or agreements relating thereto, whether written or oral. I attest that this integration clause reflected the parties' mutual understanding, as discussed

8. On January 12, 2018, I sent an email message from my Penterra business email address (skapoor@penterra.com) to Donald R. Farnham, Managing Member and Chief Executive Officer of Vantage, at his Vantage business email address (dfarnham@vantagemd.com). The text of the email stated as follows: "Don — good catching up yesterday. We're definitely open to exploring expansion into NY/NJ/PA once your New England footprint

9. I attest that the January 12, 2018 email was intended by me to express Penterra's general willingness to consider and discuss the possibility of territorial expansion at some future date. Any such expansion was, in my mind and in the mind of the Penterra commercial team, contingent upon Vantage's successful development of its New England operations and upon the parties' reaching a mutually acceptable agreement on

10. I attest that no follow-up meeting, telephone conference, or negotiation session regarding the proposed tri-state expansion occurred at or around "mid-year" 2018, as contemplated in my January 12, 2018 email, or at any subsequent time prior to the discovery of Vantage's unauthorized out-of-territory distribution activities described below. I do not recall Mr. Farnham or any other representative of Vantage initiat

11. I am familiar with Vantage's purchase history under the EDA. Section 5.2 of the EDA required Vantage to maintain a minimum annual purchase commitment of Nine Million Five Hundred Thousand Dollars ($9,500,000) of Oncalaris® per year, calculated at wholesale acquisition cost ("WAC"), as a condition of maintaining its exclusive distribution rights within the Territory. Based on my review of Penterra's internal sales

12. In early 2021, specifically in or around late January 2021, Penterra became aware that Vantage had begun distributing Oncalaris® to hospitals, oncology clinics, and other healthcare facilities located in the states of New York, New Jersey, and Pennsylvania. Based on information subsequently obtained, these unauthorized out-of-territory sales commenced on or about September 14, 2020. I became aware of these sales

13. On February 15, 2021, following an internal assessment of the Company's distribution coverage needs in the mid-Atlantic region, Penterra executed a non-binding term sheet with Meridian National Distributors, Inc. ("Meridian"), a New York corporation with offices located at 520 Seventh Avenue, 12th Floor, New York, New York 10018. The term sheet contemplated a distribution arrangement pursuant to which Meridian wo

14. I was deposed on November 2, 2021, in this action, at the offices of Calderwood & Harkness LLP, in Boston, Massachusetts. My testimony at deposition was consistent in all material respects with the statements set forth in this affidavit. At my deposition, I was questioned at length regarding the January 12, 2018 email, and I testified that the email expressed a general willingness on Penterra's part to explore th

15. In summary, and to state clearly and unequivocally: At no time did I, or any other authorized representative of Penterra Pharmaceuticals Corp. to my knowledge, grant Vantage Medical Distribution, LLC written consent to distribute Penterra Products outside the Territory as defined in Exhibit A to the Exclusive Distribution Agreement — that is, outside the six New England states of Connecticut, Maine, Massachusetts