Contract analysis

1. This action arises from the terminated acquisition of Veridian Biosciences, Inc. by Penterra Pharmaceuticals Corp. pursuant to a Stock Purchase Agreement dated June 10, 2024. Under the terms of the SPA, Penterra agreed to acquire one hundred percent (100%) of the outstanding capital stock of Veridian for an aggregate all-cash purchase price of Nine Hundred Million Dollars ($900,000,000).

2. The SPA was executed on June 10, 2024 by Dr. Anand Rajagopal, Chief Executive Officer of Penterra, on behalf of Penterra, and by Dr. Julian Marek, Chief Executive Officer and Co-Founder of Veridian, on behalf of Veridian and the selling stockholders.

3. Veridian is a privately held, clinical-stage biotechnology company headquartered at 550 Gateway Drive, Cambridge, Massachusetts 02142. Veridian has never generated any revenue from product sales. For its fiscal year ended December 31, 2023, Veridian reported total revenue of zero dollars ($0) and a net loss of eighty-seven million three hundred thousand dollars ($87,300,000). Veridian's principal asset — and the o

4. Between the signing of the SPA on June 10, 2024 and the anticipated closing, the Marlowe Asset Management-2 Phase II randomized clinical trial of VRD-4187 (ClinicalTrials.gov Identifier: NCT05837291), which enrolled a total of 387 patients across 42 clinical sites in the United States and the European Union, produced devastating safety and efficacy data. As described in detail in the Preliminary Statement and thro

5. These developments fundamentally altered Veridian's value proposition and constituted a material adverse effect within the meaning of Section 1.1 of the SPA. As a result, the conditions to Penterra's obligation to close set forth in SPA Sections 7.2(a) and 7.2(b) were not satisfied and were incapable of being satisfied prior to the Outside Date.

6. On September 30, 2024, Penterra exercised its contractual right to terminate the SPA pursuant to Section 8.1(d), delivering a formal Termination Notice to Veridian and to the Stockholder Representative. The termination was effected well in advance of the Outside Date of December 10, 2024.

7. Exclusive jurisdiction over this dispute lies in this Court pursuant to SPA Section 10.6, and the governing law is the law of the State of Delaware pursuant to the same section. Penterra does not contest personal jurisdiction or venue and submits to the jurisdiction of this Court. PARTIES A. Plaintiff

8. Veridian Biosciences, Inc. is a corporation organized and existing under the laws of the State of Delaware, with its principal office located at 550 Gateway Drive, Cambridge, Massachusetts 02142.

9. Veridian's registered agent in the State of Delaware is Tidewater Registered Agents LLC, 838 Walker Road, Suite 21-2, Dover, Delaware 19904.

10. Veridian's federal Employer Identification Number is 84-2193047.

11. Veridian's Chief Executive Officer and Co-Founder is Dr. Julian Marek, who is also an equity holder of Veridian holding approximately 8.4% of the outstanding capital stock. Veridian's Chief Scientific Officer and Co-Founder is Dr. Priya Chandrasekaran, who holds approximately 6.2% of the outstanding capital stock. Veridian's Chief Financial Officer is Steven R. Kessler, and its General Counsel is Rachel Stein-Gol

12. Veridian is represented in this action by Zalcourt Archer & Cole LLP, with Rebecca Whitmore serving as Lead Partner. Zalcourt Archer & Cole LLP is located at One Federal Street, 30th Floor, Boston, Massachusetts 02110.

13. Veridian's financial advisor in connection with the transaction that is the subject of this action was Ridgeway Partners LLC, with Laura Beckett, Managing Director, serving as the principal contact. Ridgeway Partners LLC is located at 101 Huntington Avenue, Suite 2500, Boston, Massachusetts 02199.

14. The Stockholder Representative appointed under the SPA is David Ng, Managing Partner of Crestline Ventures, LP. Mr. Ng was designated to act as the Stockholder Representative on behalf of the selling stockholders of Veridian following the execution of the SPA. B. Defendant

15. Penterra Pharmaceuticals Corp. is a corporation organized and existing under the laws of the State of Delaware, with its principal executive office located at 1100 Meridian Boulevard, Suite 400, Princeton, New Jersey 08540.

16. Penterra's registered agent in the State of Delaware is Capitol Corporate Services, Inc., 1675 South Ashbury Asset Advisors, Suite B, Dover, Delaware 19901.

17. Penterra is a publicly traded company, with its common stock listed on the Nasdaq Stock Market under the ticker symbol "PPCA." As of June 2024, Penterra's approximate market capitalization was Fourteen Billion Two Hundred Million Dollars ($14,200,000,000).

18. Penterra's federal Employer Identification Number is 22-3847561.

19. Penterra's Chief Executive Officer is Dr. Anand Rajagopal. Its Chief Financial Officer is Catherine M. Burgess. Its General Counsel and Secretary is Thomas F. Holbrook. Its Senior Vice President, Corporate Development is Natalie Reiner. The Chair of Penterra's Board of Directors is Margaret Liu Whitfield.

20. For its fiscal year ended December 31, 2023, Penterra reported total revenue of Four Billion Eight Hundred Seventy Million Dollars ($4,870,000,000). As of the end of the second quarter of 2024 (June 30, 2024), Penterra had cash and cash equivalents on hand of approximately Two Billion One Hundred Million Dollars ($2,100,000,000). ANSWER TO SPECIFIC ALLEGATIONS OF THE COMPLAINT Penterra answers each numbered parag

I. Responses to Allegations Concerning the Parties (Complaint ¶¶ 1–15)

21. Penterra admits that it is a corporation organized and existing under the laws of the State of Delaware. Penterra admits that Veridian is a corporation organized and existing under the laws of the State of Delaware. Penterra admits the corporate existence and good standing of both Penterra and Veridian, in each case as of the relevant dates alleged in the Complaint.

22. To the extent the Complaint sets forth the identities, titles, and positions of the key officers, directors, and representatives of Penterra and Veridian, Penterra admits those allegations as factual matters of public record and corporate documentation, except that Penterra denies any characterizations or inferences drawn from the identification of such individuals that are inconsistent with the factual record.

23. Penterra admits that it is a publicly traded company listed on the Nasdaq Stock Market under the ticker symbol "PPCA" and that its approximate market capitalization was $14.2 billion as of June 2024.

24. Penterra admits that Veridian is a privately held, clinical-stage biotechnology company with its principal office at 550 Gateway Drive, Cambridge, Massachusetts 02142, and that Veridian's registered agent is Tidewater Registered Agents LLC at the address stated in the Complaint.

25. To the extent the Complaint alleges any additional facts concerning the parties beyond those admitted herein, Penterra denies such allegations unless they are specifically admitted elsewhere in this Answer.

II. Responses to Allegations Concerning the Transaction Background (Complaint ¶¶ 16–45)

26. Penterra admits the existence of the Stock Purchase Agreement dated June 10, 2024. Penterra admits that the aggregate cash purchase price set forth in the SPA was Nine Hundred Million Dollars ($900,000,000). Penterra states that the SPA speaks for itself, and Penterra denies any characterizations of the SPA or its terms that are inconsistent with the actual language of the agreement.

27. Penterra admits that on or about February 12, 2024, the Board of Directors of Penterra authorized the exploration of a potential acquisition of Veridian. Penterra admits that this authorization followed a strategic review conducted by Penterra's senior management and Corporate Development team, led by Natalie Reiner, Senior Vice President, Corporate Development.

28. Penterra admits that on or about February 14, 2024, Penterra engaged Calderwood & Harkness LLP as its legal advisor and Garrison Zanthor & Co., LLC as its financial advisor in connection with the proposed transaction.

29. Penterra admits that a non-binding indication of interest (the "IOI") was submitted to Veridian on or about March 1, 2024. The IOI set forth an indicative enterprise value range of Eight Hundred Fifty Million Dollars ($850,000,000) to Nine Hundred Fifty Million Dollars ($950,000,000), subject to confirmatory due diligence and other customary conditions.

30. Penterra admits that a mutual non-disclosure agreement (the "NDA") was executed between Penterra and Veridian on or about March 4, 2024. Penterra further admits that access to Veridian's electronic data room was granted to Penterra and its advisors on or about March 11, 2024.

31. Penterra admits that on or about March 18, 2024, Penterra engaged Broadleaf Scientific Consulting LLC to conduct independent clinical due diligence on Veridian's pipeline, including specifically VRD-4187 and the Marlowe Asset Management-2 trial program. The engagement was led by Dr. Raymond Kapoor, a recognized expert in oncology clinical trial design and regulatory science.

32. Penterra admits that a Premerger Notification and Report Form pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), was filed with the Federal Trade Commission and the Antitrust Division of the United States Department of Justice on or about April 22, 2024. The filing fee paid was Two Hundred Eighty Thousand Five Hundred Dollars ($280,500). Early termination of the HSR

33. Penterra admits that on or about June 7, 2024, a financing commitment letter (Reference No. CL-2024-PPCA-0607) was executed with Summit Ridge Capital Partners, LP and Ironclad Trust Company, N.A. The commitment letter provided for a Five Hundred Million Dollar ($500,000,000) senior secured term loan at a rate of SOFR plus 225 basis points, subject to customary conditions. This financing, together with Penterra's

34. Penterra admits that Garrison Zanthor & Co., LLC delivered a fairness opinion to the Penterra Board of Directors on June 9, 2024, opining that the purchase price of $900,000,000 was fair, from a financial point of view, to Penterra. The fairness opinion was presented by Kevin Driscoll, Managing Director of Garrison Zanthor.

35. Penterra admits that the Board of Directors of Penterra ratified and authorized the execution and delivery of the SPA at a meeting held on June 10, 2024.

36. Penterra admits, upon information and belief, that Veridian obtained written consents from holders of more than ninety percent (90%) of its outstanding capital stock approving the transaction, and that such written consents were delivered on or about June 14, 2024.

37. Penterra admits that a representations and warranties insurance policy (Policy No. AIC-RWI-2024-07892) was bound with Atlas Indemnity Insurance Co. on or about June 12, 2024. Penterra admits that the policy had a limit of liability of One Hundred Eighty Million Dollars ($180,000,000), a self-insured retention ("SIR") of Nine Million Dollars ($9,000,000), an annual premium of Three Million Nine Hundred Sixty Thous

38. To the extent the Complaint contains additional allegations or characterizations concerning the transaction background beyond those specifically admitted above, Penterra states that the SPA, the IOI, the NDA, the commitment letter, the fairness opinion, the R&W insurance policy, and all other referenced documents speak for themselves, and Penterra denies any characterizations of such documents that are inconsiste

III. Responses to Allegations Concerning SPA Terms (Complaint ¶¶ 46–78)

39. Penterra admits that the SPA contained the following key economic terms, and states that the SPA speaks for itself in all respects: (a) Purchase Price: Nine Hundred Million Dollars ($900,000,000), as set forth in SPA Section 2.1. (b) Indemnification Escrow Amount: One Hundred Eighty Million Dollars ($180,000,000), representing twenty percent (20%) of the purchase price, to be deposited with Fidelis National Escro

40. Penterra admits that SPA Section 1.1 defines "Material Adverse Effect" (or "MAE") as any event, change, development, occurrence, condition, or effect that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on (a) the business, results of operations, financial condition, or assets of the Company, taken as a whole, or (b) the ability of the Sellers to consum

41. Penterra admits that the MAE definition in SPA Section 1.1 contains carveouts for the following categories of events, changes, developments, occurrences, conditions, or effects: (i) general economic or political conditions; (ii) conditions affecting the biotechnology or pharmaceutical industries generally; (iii) changes in applicable law or in United States generally accepted accounting principles ("GAAP"); (iv)

42. Penterra admits that the carveouts set forth in clauses (i) through (vi) above are subject to a disproportionate-impact exception. Specifically, the carveouts do not apply — and the relevant events, changes, or developments may be taken into account in determining whether an MAE has occurred — to the extent that the applicable event, change, or development disproportionately affects the Company relative to compar

43. Penterra admits that the SPA contains a specific performance provision at Section 10.12 that grants the Sellers the right to seek specific performance to compel the Buyer to consummate the closing, provided that all closing conditions are satisfied. The SPA speaks for itself as to the precise terms and conditions of this provision.

44. Penterra denies any characterization in the Complaint that all closing conditions were satisfied at the time of Penterra's termination of the SPA, or at any time following the events described herein. As set forth in this Answer and in the Affirmative Defenses below, the closing conditions in SPA Sections 7.2(a) and 7.2(b) were not satisfied and were incapable of being satisfied.

IV. Responses to Allegations Concerning the Closing Conditions (Complaint ¶¶ 79–87)

45. Penterra admits that SPA Section 7.2(a) provides that, as a condition to Buyer's obligation to consummate the closing, the representations and warranties of the Sellers set forth in the SPA (other than Fundamental Representations) shall be true and correct in all respects (without giving effect to any materiality or MAE qualifiers therein) as of the date of the SPA and as of the Closing Date as though made on and

46. Penterra admits that SPA Section 7.2(b) provides that, as a separate condition to Buyer's obligation to consummate the closing, since the date of the Agreement, no Material Adverse Effect shall have occurred that is continuing as of the Closing Date.

47. Penterra denies that these conditions were satisfied or capable of being satisfied at the time of Penterra's termination or at any time thereafter prior to the Outside Date of December 10, 2024. The occurrence of the material adverse effect described herein rendered both Section 7.2(a) and Section 7.2(b) incapable of satisfaction.

V. Responses to Allegations Concerning VRD-4187 Clinical Data and FDA Action (Complaint ¶¶ 88–120)

48. Penterra admits that on August 14, 2024, the independent Data Monitoring Committee for the Marlowe Asset Management-2 Phase II randomized clinical trial of VRD-4187 (ClinicalTrials.gov Identifier: NCT05837291) completed its pre-planned interim analysis. Penterra admits that the Marlowe Asset Management-2 trial enrolled a total of 387 patients across 42 clinical sites in the United States and the European Union.

49. Penterra admits that the DMC recommended the immediate suspension of enrollment in the Marlowe Asset Management-2 trial and mandatory dose modification for VRD-4187 as a result of the interim analysis findings.

50. Penterra admits that it received notice of the DMC findings from Veridian on August 16, 2024, two (2) days after the August 14, 2024 DMC meeting. Veridian provided such notice pursuant to SPA Section 5.1(b), which requires the Company to provide prompt notice to Buyer of any material developments affecting the Company's business, operations, or clinical programs.

51. Penterra admits the following specific clinical data findings from the Marlowe Asset Management-2 interim analysis, as reported by the DMC: (a) The incidence of Grade 3 or higher cytokine release syndrome (CRS) in the VRD-4187 treatment arm was 23.4%, compared to 4.1% in the standard-of-care control arm — a differential of 19.3 percentage points. (b) Seven (7) treatment-related deaths occurred in the VRD-4187 tre

52. Penterra admits that on August 22, 2024, the FDA imposed a partial clinical hold on VRD-4187 under Investigational New Drug Application No. 154832 (IND 154832). The partial clinical hold halted further enrollment of new patients in the Marlowe Asset Management-2 trial and required Veridian to submit additional safety data and a revised clinical protocol before enrollment could resume.

53. Penterra admits, upon information and belief, that Veridian implemented a Protocol v4.0 amendment on or about August 28, 2024, which included mandatory tocilizumab prophylaxis for all patients receiving VRD-4187 and a dose reduction from 1.5 mg/kg to 0.75 mg/kg — effectively halving the therapeutic dose.

54. Penterra admits that Broadleaf Scientific Consulting LLC delivered a supplemental clinical assessment to Penterra on August 19, 2024. The supplemental assessment was prepared by Dr. Raymond Kapoor and his team at Broadleaf Scientific at Penterra's request following receipt of the DMC interim analysis results.

55. Penterra denies any characterization in the Complaint that the Marlowe Asset Management-2 clinical data was preliminary, routine, expected, or non-material. The data represented a definitive and catastrophic readout from the critical value-driving clinical program for Veridian's lead drug candidate, revealing fundamental safety and efficacy problems of the most serious kind.