Contract analysis

I. Executive Summary This memorandum summarizes the key findings and recommendations of Calderwood & Harkness LLP ("C&H") arising from our review of the fee letter dated June 7, 2024 (the "Fee Letter"), executed concurrently with the Commitment Letter bearing reference number CL-2024-PPCA-0607 (the "Commitment Letter"), in connection with the proposed $500,000,000 senior secured term loan facility (the "Term Loan Fac

II. Background and Transaction Context Overview of the Penterra-Veridian Transaction Penterra Pharmaceuticals Corp. is a Nasdaq-listed biopharmaceutical company (ticker: PPCA) headquartered at 1100 Meridian Boulevard, Suite 400, Princeton, NJ 08540. The Company has a current market capitalization of approximately $14.2 billion and reported revenue of $4.87 billion for fiscal year 2023. Penterra's existing portfolio i

III. Summary of Fee Categories The Fee Letter provides for five categories of fees payable by Penterra in connection with the Term Loan Facility. Each is summarized below. A. Arrangement Fee The Fee Letter provides for a one-time upfront arrangement fee payable to Summit Ridge Capital Partners, LP in its capacity as Lead Arranger for the Term Loan Facility. The arrangement fee is intended to compensate Summit Ridge f

IV. Fee Calculation Scenarios and Cost Modeling In order to assist the deal team in evaluating Penterra's fee exposure under the Fee Letter across a range of potential transaction timelines, we have prepared the following scenario analyses. Each scenario calculates the commitment fee and ticking fee based on the applicable rate, the $500,000,000 commitment amount, and the Actual/365 day count convention. The arrangem

V. Non-Refundability and Clawback Provisions A. General Non-Refundability The Fee Letter provides, in clear and unequivocal terms, that all fees — including the arrangement fee, commitment fees, ticking fees, and administrative agent fees — are non-refundable once earned or accrued. This non-refundability applies regardless of whether the Term Loan Facility is ultimately funded, regardless of whether the Acquisition

VI. Conditions to Fee Obligations; Triggers A. Conditions to Accrual The conditions governing the commencement of each fee obligation under the Fee Letter are summarized as follows: (i) Commitment Fee: Begins accruing immediately upon execution of the Commitment Letter, which occurred on June 7, 2024. No precondition to accrual exists; the fee begins running upon signing. (ii) Ticking Fee: Begins accruing on the 90th

VII. Key Issues and Recommendations Based on our review of the Fee Letter, we have identified the following issues that warrant attention from the deal team. For each issue, we provide our analysis and a specific recommendation. A. Clarification of Ticking Fee Trigger Date Issue. The Fee Letter defines the commencement date of the ticking fee as "the date which is ninety (90) days following the signing date of the Ac

VIII. Comparison to Market Terms To provide context for our assessment of the Fee Letter, we have benchmarked the fee structure against comparable committed acquisition financings in the pharmaceutical and biotechnology sector completed during 2023 and the first half of 2024. Our review included publicly available fee disclosures, proprietary C&H deal data, and market intelligence from leveraged finance desks at majo

IX. Conclusion Based on our comprehensive review of the Fee Letter, Calderwood & Harkness LLP recommends that Penterra Pharmaceuticals Corp. proceed with the Fee Letter as drafted, subject to the clarification items identified in Section VII of this memorandum. Specifically, we recommend that Penterra:

1. Confirm the interpretation of the ticking fee trigger date with Summit Ridge and Ironclad (Section VII.A);

2. Document Penterra's maximum fee exposure in the transaction cost tracker (Section VII.B);

3. Confirm that the confidentiality carve-out in the Fee Letter covers required SEC and regulatory disclosures (Section VII.D);

4. Coordinate with Leonard Cross on tax treatment (Section VII.E); and

5. Confirm wire instructions and internal authorization procedures with Penterra's treasury team (Section VII.F). Penterra's total fee exposure under the Fee Letter is manageable relative to the Company's financial resources. With $2.1 billion in cash on hand and a market capitalization of approximately $14.2 billion, the maximum combined commitment and ticking fee exposure of approximately $1,115,411 (plus the arran