Contract analysis

1. ATTENDEES 1.1 IRS Examination Team The following IRS personnel participated in the mid-examination conference: • Gerald Meskill, Supervisory Revenue Agent / Team Manager — present in person at the Newark Field Office. Meskill led the conference on behalf of the IRS and served as the primary point of contact for procedural and scheduling matters. • Patricia Dunleavy, Lead Revenue Agent — present in person. Dunleavy

2. PURPOSE AND BACKGROUND OF CONFERENCE The mid-examination conference was requested by Calderwood & Harkness LLP on behalf of Penterra Pharmaceuticals Corp. via letter to the IRS examination team dated May 10, 2023. The stated purposes of the conference were threefold: (1) to discuss the current status of the examination and the progress of outstanding Information Document Requests; (2) to narrow remaining issues be

3. EXAMINATION STATUS — IDR PROGRESS 3.1 Completed IDRs Meskill confirmed at the outset of the conference that the examination team had received and was actively reviewing responses to IDRs 1 through 38. He characterized the volume of documentation received as substantial and indicated that the exam team had devoted considerable time to reviewing the materials produced by PPC. Dunleavy provided further detail, statin

4. IRS PRELIMINARY POSITIONS — SUBSTANTIVE DISCUSSION The examination team provided preliminary views on the substantive transfer pricing issues under examination. Meskill prefaced this portion of the conference by stating that the views expressed were preliminary and subject to change as the examination continued, and that the formal positions of the IRS would be reflected in the anticipated Notice of Proposed Adjus

5. ANTICIPATED NOPA TIMELINE Meskill stated that the examination team anticipated completing its analysis and issuing a Notice of Proposed Adjustment ("NOPA") in the fall of 2023. He described this timeline as the exam team's current working assumption, subject to change depending on the pace of the remaining IDR process and the results of the examination team's ongoing analysis. Dunleavy provided a more specific est

6. STATUTE OF LIMITATIONS DISCUSSION Cross raised the statute of limitations for TY 2017, noting that the standard three-year statute of limitations under IRC § 6501(a) — measured from the original filing date of PPC's Form 1120 for TY 2017 — was approaching. Cross indicated that this issue required prompt attention to ensure the IRS's examination rights were preserved and that any resolution could proceed without un

7. COORDINATION ISSUES 7.1 IRS Economist's Analysis Cross requested the opportunity for Whitmore Valuation Group's economists — specifically, Dr. Helena Vasquez (Managing Director) and Dr. Rohan Chakrabarti (Senior Economist) — to meet with Dr. Washburne to discuss economic methodologies before the NOPA was issued. Cross stated that such a meeting could serve to narrow the economic issues between the parties, identif

8. ACTION ITEMS AND NEXT STEPS The following action items and next steps were identified and agreed upon during the conference:

1. Remaining IDRs. The IRS examination team will issue remaining IDRs (anticipated IDRs 39 through 47) by the end of July 2023, with the possibility that a final or supplemental IDR may extend into August or September 2023 depending on the progress of the examination.

2. IDR Responses. PPC and Calderwood & Harkness will respond to all remaining IDRs as promptly as possible, with a target of completing all outstanding IDR responses by September 2023.

3. Statute Extensions. The IRS examination team will circulate proposed Forms 872 for PPC's review and execution, extending the statute of limitations for TY 2017 and TY 2018 through December 31, 2024.

4. Economist Meeting. The IRS will consider Calderwood & Harkness's request for a meeting between Whitmore Valuation Group's economists (Dr. Vasquez and Dr. Chakrabarti) and Dr. Washburne to discuss economic methodologies. Meskill will revert to C&H with a response.

5. NOPA Timeline. The NOPA is anticipated to be issued in October 2023, subject to timely completion of the IDR process.

6. Reservation of Rights. Calderwood & Harkness, on behalf of PPC, expressly reserved all rights to contest any proposed adjustments in the anticipated NOPA. Cross reiterated the strength of PPC's transfer pricing positions under IRC § 482, Treasury Regulations §§ 1.482-4 and 1.482-7, and the arm's-length standard as applied to PPC's intercompany transactions with PBI.

9. OBSERVATIONS AND STRATEGIC NOTES ATTORNEY WORK PRODUCT — INTERNAL ONLY PROTECTED CORE WORK PRODUCT — MENTAL IMPRESSIONS, OPINIONS, AND STRATEGIC ANALYSIS OF COUNSEL The following observations and strategic notes reflect the mental impressions, opinions, conclusions, and legal theories of counsel at Calderwood & Harkness LLP. This section constitutes protected core attorney work product under Fed. R. Civ. P. 26(b)(

§ 6662(h) Gross Valuation Misstatement Penalty. The IRS did not mention the § 6662(h) gross valuation misstatement (40%) penalty with any conviction during the conference. Rosario's reservation appeared to be pro forma and consistent with standard IRS practice of preserving all available penalty positions at the examination stage. Based on the conference discussion, the 40% penalty does not appear to be a primary foc

10. CERTIFICATION AND DISTRIBUTION These notes were prepared contemporaneously with the mid-examination conference held on May 25, 2023, and finalized on May 26, 2023. Prepared by: ________________________________________ Garrett Simmons Lead Associate Calderwood & Harkness LLP 1735 Market Street, Suite 3100 Philadelphia, PA 19103 Date: May 26, 2023 Reviewed and Approved by: ________________________________________ L