Contract analysis

1. INTRODUCTION AND PURPOSE This memorandum summarizes the key terms of the buyer-side representation and warranty insurance policy (the "R&W Policy" or the "Policy") issued by Atlas Indemnity Insurance Co. ("Atlas Indemnity") in connection with the Stock Purchase Agreement dated June 10, 2024 (the "SPA") by and among Penterra Pharmaceuticals Corp. ("Penterra" or the "Buyer"), Veridian Biosciences, Inc. ("Veridian" o

2. TRANSACTION OVERVIEW The following summarizes the material terms of the Transaction for purposes of contextualizing the R&W Policy placement: Transaction. The Transaction involves the acquisition by Penterra Pharmaceuticals Corp. of one hundred percent (100%) of the outstanding capital stock of Veridian Biosciences, Inc., a privately held clinical-stage biotechnology company, pursuant to the terms and conditions o

3. PARTIES TO THE POLICY 3.1 Insurer. Full Legal Name: Atlas Indemnity Insurance Co. Address: 300 First Stamford Place, Stamford, Connecticut 06902 Underwriter: Graham Fielding, Senior Vice President, Transactional Risk Group Role: Atlas Indemnity is the issuer and sole underwriter of the R&W Policy. Atlas Indemnity is a Connecticut-domiciled surplus lines insurer and is a recognized market-leading provider of repres

4. POLICY TERMS — SUMMARY 4.1 Policy Number AIC-RWI-2024-07892 4.2 Policy Type The Policy is a buyer-side representation and warranty insurance policy. As such, it is issued to and for the benefit of the Buyer (Penterra) as Named Insured, and it insures the Named Insured against Losses arising from breaches of the Sellers' representations and warranties contained in Article IV of the SPA. The Policy is not a seller-s

5. SCOPE OF COVERAGE 5.1 Covered Representations and Warranties The Policy covers Losses arising from breaches of the representations and warranties made by the Sellers in Article IV of the SPA. The scope of coverage is comprehensive and extends to all representations and warranties set forth in the SPA, including but not limited to the following: (a) Organization and Authority (SPA § 4.1) — Representations regarding

6. EXCLUSIONS 6.1 Standard Exclusions The Policy contains certain standard exclusions that are customary in buyer-side representation and warranty insurance policies. The Policy does not cover Losses arising from or related to the following: (a) Purchase Price Adjustments, Working Capital Adjustments, and Earn-Out Disputes. The Policy does not cover any Loss arising from or related to purchase price adjustments, work

7. KNOWLEDGE AND DILIGENCE 7.1 Named Insured's Knowledge Group The Policy defines the "Knowledge Group" for purposes of the known-breach exclusion (Section 6.1(e) above) as the following six individuals: The Knowledge Group was carefully negotiated between Calderwood & Harkness (on behalf of Penterra) and Atlas Indemnity's underwriting team during the underwriting process. The Knowledge Group is intentionally limited

8. CLAIMS PROCEDURES 8.1 Notice of Claim In the event that the Named Insured becomes aware of any claim, potential claim, or circumstance that may give rise to a claim under the Policy, the Named Insured must provide written notice to Atlas Indemnity as promptly as practicable, and in any event within the applicable Policy period. Failure to provide timely notice within the applicable Policy period will result in the

9. SUBROGATION Upon making any payment under the Policy, Atlas Indemnity shall be subrogated to all rights, claims, and causes of action of the Named Insured against the Sellers, the Stockholder Representative, and any third parties with respect to the Loss for which such payment was made. The Named Insured shall cooperate with Atlas Indemnity in the pursuit of any subrogation claim, including by executing any docume

10. ASSIGNMENT AND TRANSFER The Policy may be assigned by the Named Insured to any of the following without the prior consent of Atlas Indemnity: (a) Any affiliate of the Named Insured (as defined in the Policy); (b) Any successor entity of the Named Insured, whether by merger, consolidation, reorganization, or otherwise; (c) Any entity that acquires all or substantially all of the assets or equity interests of the N

11. POLICY CONDITIONS 11.1 Closing Condition The Policy is conditional on the occurrence of the Closing of the Transaction as defined in the SPA. If the Closing does not occur for any reason—including termination of the SPA, failure of a condition to closing, regulatory prohibition, or mutual agreement of the parties—the Policy does not incept, no coverage is provided, and no claims may be made thereunder. The premiu