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MEMORANDUM

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT

FROM: Brendan Walsh, Associate, Capital Markets Group

TO: Jennifer Kwon, Partner, Capital Markets Group Theodore Langston, Partner, Capital Markets Group

CC: Audrey Zhou, Senior Associate, Capital Markets Group

DATE: September 5, 2023

RE: Conflict Check Results — Penterra Pharmaceuticals Corp. Selling-Stockholder Secondary Offering

MATTER NO.: 1018-00001

1. Purpose of Memorandum

This memorandum documents the conflict check procedures undertaken and the results obtained in connection with the proposed engagement of Calderwood & Harkness LLP ("C&H" or the "Firm") as issuer's counsel to Penterra Pharmaceuticals Corp. ("PPC" or "Penterra") in a registered selling-stockholder secondary offering of shares of PPC common stock (the "Offering"). The Offering will consist of the sale by certain members of the Castellano founding family (collectively, the "Selling Stockholders") of an aggregate of 6,250,000 shares of PPC common stock at an estimated public offering price of approximately $41.60 per share, for an estimated aggregate deal value of approximately $260,000,000.

PPC is a Delaware corporation, publicly traded on the Nasdaq Global Select Market under the ticker symbol "PNTR." The company's principal executive offices are located at 400 Meridian Parkway, Suite 1200, Princeton, New Jersey 08540. PPC is a clinical-stage pharmaceutical company with a portfolio of oncology and immunology therapeutics. The company completed its initial public offering in February 2023 and has been publicly reporting since that time.

The Offering is structured as a shelf takedown under PPC's existing shelf registration statement on Form S-3 (File No. 333-274851), which was filed with the Securities and Exchange Commission (the "SEC") on August 10, 2023 and declared effective on August 22, 2023. The Offering will be effected by means of a prospectus supplement to be filed with the SEC pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the "Securities Act"). No primary shares will be offered by PPC, and PPC will not receive any proceeds from the sale of shares by the Selling Stockholders. PPC's role in the transaction is limited to cooperation and facilitation of the Offering, including providing customary issuer representations and warranties in the underwriting agreement, furnishing officer certificates and other closing deliverables, and filing all necessary documents with the SEC.

The engagement was opened on September 5, 2023. The engagement letter between C&H and PPC was fully executed on the same date. The engagement provides for a capped fee of $485,000 plus reasonable out-of-pocket disbursements, which fee arrangement reflects the limited scope of issuer-side work in a selling-stockholder secondary offering where the registration statement is already effective and the company's periodic reporting is current.

This memorandum is intended to serve as the Firm's record of the conflict check performed in connection with this new matter, in compliance with the Firm's policies and procedures for new matter intake, as well as applicable provisions of the New York Rules of Professional Conduct (the "NYRPC"), including Rules 1.7 (Conflict of Interest: Current Clients), 1.8 (Current Clients: Specific Conflict of Interest Rules), 1.9 (Duties to Former Clients), and 1.10 (Imputation of Conflicts of Interest).

2. Conflict Check Methodology

The Firm conducted a comprehensive conflict check in accordance with its standard New Matter Intake ("NMI") procedures. The following steps were taken on September 5, 2023, prior to execution of the engagement letter:

2.1 Database Search. All parties, principals, and affiliated entities identified in connection with the proposed engagement were submitted to the Firm's conflicts database through the New Matter Intake System ("NMIS"), the Firm's proprietary conflicts and matter management platform. The NMIS contains records of all current and former client representations, adverse parties, related parties, and key individuals associated with matters handled by C&H.

2.2 Search Parameters. Each party was searched using multiple search parameters to maximize the likelihood of identifying potential conflicts. These parameters included: (a) full legal entity name; (b) short names, acronyms, and commonly used trade names or aliases; (c) Nasdaq ticker symbol (where applicable); (d) names of principal individuals associated with each party (including officers, directors, managing directors, engagement partners, and other key contacts); and (e) known affiliated entities and subsidiaries.

2.3 Cross-Reference Against Active and Closed Matters. The search results were cross-referenced against (a) all currently active matters in the NMIS and (b) all matters closed within the preceding twenty-four (24) months. This look-back period exceeds the minimum twelve-month period required by the Firm's internal policies and is consistent with best practices for capital markets engagements involving publicly traded companies and major financial institutions.

2.4 Institutional Client List and Standing Instruction Clients. The search results were reviewed against the Firm's institutional client list, which identifies clients with whom C&H maintains an ongoing relationship and for whom special conflict-checking protocols may apply. The search was further reviewed against the Firm's list of "standing instruction" clients — those clients who have provided advance instructions regarding matters in which C&H may or may not represent other parties.

2.5 Ethical Walls and Screening Protocols. The conflict check confirmed that no ethical walls, information barriers, or screening protocols are currently in effect at C&H with respect to any party identified in connection with the proposed engagement. No member of the proposed deal team is subject to any recusal or screening obligation that would affect the Firm's ability to represent PPC in this transaction.

2.6 Verification and Sign-Off. The results of the conflict check were reviewed by the undersigned, verified against publicly available information (including SEC filings, Nasdaq listing records, and the Delaware Division of Corporations database), and submitted for approval to the responsible partner, Jennifer Kwon.

3. Parties Searched and Results

Set forth below is a detailed summary of each party searched, including full identifying information, the party's role in the proposed transaction, and the results of the conflict check.

3.1 The Issuer — Penterra Pharmaceuticals Corp.

Key Individuals Searched:

• Dr. Marco Castellano — Chief Executive Officer

• Lisa Hargrove — Chief Financial Officer

• David Orenstein — General Counsel and Corporate Secretary

• Dr. Elena Castellano — Chair of the Board of Directors

Conflict Check Result: CLEARED. The Firm has not represented PPC in any prior matter. No adverse representation of any party against PPC was identified in the NMIS. No current or former client relationship exists between C&H and PPC. PPC is being onboarded as a new client of the Firm in connection with this engagement. Standard new-client due diligence procedures have been completed, including verification of PPC's good standing in Delaware, confirmation of signing authority for the engagement letter (David Orenstein, General Counsel, pursuant to board authorization), and completion of the Firm's anti-money laundering and know-your-client questionnaire.

3.2 Selling Stockholders — The Castellano Family

The Selling Stockholders in the proposed Offering consist of three individual members of the Castellano founding family and one family holding vehicle, as follows:

Dr. Elena Castellano — Co-Founder of PPC and current Chair of the Board of Directors. Dr. Elena Castellano holds 14,200,000 shares of PPC common stock and proposes to sell 3,000,000 shares in the Offering. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Dr. Elena Castellano will hold 11,200,000 shares, representing approximately 9.3% of the outstanding shares.

Dr. Riccardo Castellano — Co-Founder of PPC and current non-executive member of the Board of Directors. Dr. Riccardo Castellano holds 12,800,000 shares of PPC common stock and proposes to sell 2,500,000 shares in the Offering. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Dr. Riccardo Castellano will hold 10,300,000 shares, representing approximately 8.6% of the outstanding shares.

Dr. Marco Castellano — Son of Dr. Elena Castellano and Dr. Riccardo Castellano, and current Chief Executive Officer of PPC. Dr. Marco Castellano holds 4,500,000 shares of PPC common stock and proposes to sell 500,000 shares in the Offering. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Dr. Marco Castellano will hold 4,000,000 shares, representing approximately 3.3% of the outstanding shares.

Castellano Family Holdings LLC — A Delaware limited liability company formed as a family holding vehicle for shares of PPC common stock. Castellano Family Holdings LLC (EIN: 87-2165438) holds 8,600,000 shares of PPC common stock and proposes to sell 250,000 shares in the Offering. The LLC's address is c/o Penterra Pharmaceuticals Corp., 400 Meridian Parkway, Suite 1200, Princeton, NJ 08540. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Castellano Family Holdings LLC will hold 8,350,000 shares, representing approximately 7.0% of the outstanding shares.

In the aggregate, the Castellano family (including Castellano Family Holdings LLC) holds 40,100,000 shares of PPC common stock prior to the Offering, representing approximately 33.4% of the 120,000,000 shares of PPC common stock currently outstanding. The total base offering by the Selling Stockholders is 6,250,000 shares. Following the completion of the Offering (assuming no exercise of the underwriters' option to purchase additional shares), the Castellano family will hold approximately 33,850,000 shares, representing approximately 28.2% of the outstanding shares.

Role in Transaction: The Castellano family members and Castellano Family Holdings LLC are the Selling Stockholders in the Offering. C&H does not represent the Selling Stockholders individually or as a group. The Selling Stockholders are represented by their own personal counsel, Whitfield & Garza LLP, a New York law firm, under the supervision of Patricia Velázquez, Partner.

Conflict Check Result: CLEARED. The Firm has not represented any Castellano family member — Dr. Elena Castellano, Dr. Riccardo Castellano, or Dr. Marco Castellano — in any individual capacity in any prior matter. The Firm has not represented Castellano Family Holdings LLC in any prior matter. No adverse representation of any party against any member of the Castellano family or Castellano Family Holdings LLC was identified in the NMIS. No conflict exists.

3.3 Lead Left Book-Runner — Ridgeline Securities LLC

Key Individuals Searched:

• Jonathan Pryce-Hall — Managing Director, Lead Banker on the Penterra engagement

• Angela Ferris — Vice President, Syndicate Desk

Conflict Check Result: CLEARED. The NMIS search returned two prior matters involving Ridgeline Securities LLC, both of which are closed and unrelated to PPC or the Castellano family:

(a) Matter No. 1018-00001 — Representation of Ridgeline Securities LLC as initial purchaser in a $175 million offering of convertible senior notes due 2027 by Velaris Therapeutics, Inc. (an unrelated pharmaceutical company). Engagement opened March 2022; closed July 2022.

(b) Matter No. 1018-00001 — Representation of Ridgeline Securities LLC as financial advisor on a buyside acquisition of a minority stake in Elysian Data Systems, Inc. Engagement opened September 2021; closed December 2021.

Both of these prior representations have been fully concluded. No engagement letter or retainer agreement is currently in effect between C&H and Ridgeline Securities. Ridgeline Securities is not a current client of the Firm. In the proposed Offering, Ridgeline Securities and PPC have aligned interests — Ridgeline acts as lead left book-runner and PPC acts as issuer, and both parties share an interest in the successful execution and completion of the Offering. Ridgeline Securities is represented by its own counsel, Caldwell, Pearce & Strauss LLP, in connection with this transaction. No adversity between C&H's representation of PPC and Ridgeline's interests is anticipated. A more detailed analysis of this matter is set forth in Section 4.1 below.

3.4 Joint Book-Runner — Broadmark Capital Inc.

Key Individual Searched:

• Samuel Okonkwo — Managing Director

Conflict Check Result: CLEARED. The NMIS search returned no results for Broadmark Capital Inc. The Firm has not represented Broadmark Capital in any prior matter, and no adverse representation of any party against Broadmark Capital was identified. No conflict exists.

3.5 Co-Manager — Linden Groves & Co.

Conflict Check Result: CLEARED. The NMIS search returned no results for Linden Groves & Co. The Firm has not represented Linden Groves in any prior matter, and no adverse representation of any party against Linden Groves was identified. No conflict exists.

3.6 Co-Manager — Harborview Partners LLC

Conflict Check Result: CLEARED. The NMIS search returned no results for Harborview Partners LLC. The Firm has not represented Harborview Partners in any prior matter, and no adverse representation of any party against Harborview Partners was identified. No conflict exists.

3.7 IPO Co-Manager / Lock-Up Party — Morningstar Zanthor & Co.

Key Individual Searched:

• Diane Chaudhary — Managing Director

Morningstar Zanthor served as a co-manager in PPC's February 2023 initial public offering and is a party to the lock-up agreements executed in connection therewith. The 180-day lock-up period under those agreements does not expire until approximately August 2023, and the Selling Stockholders require a waiver or early release from Morningstar Zanthor (in addition to Ridgeline Securities and Broadmark Capital, the other lock-up parties) in order to proceed with the Offering. Morningstar Zanthor is not participating as an underwriter in the secondary offering.

Conflict Check Result: CLEARED. The NMIS search returned no results for Morningstar Zanthor & Co. The Firm has not represented Morningstar Zanthor in any prior matter, and no adverse representation of any party against Morningstar Zanthor was identified. No conflict exists.

3.8 Underwriters' Counsel — Caldwell, Pearce & Strauss LLP

Key Individuals Searched:

• Margaret Hui — Partner, Capital Markets Group

• Ryan Petrosian — Associate, Capital Markets Group

Conflict Check Result: CLEARED. C&H and Caldwell, Pearce & Strauss LLP have worked on opposite sides of prior capital markets transactions, which is customary and expected given the prominence of both firms in the capital markets practice area. These prior interactions involved arm's-length negotiations of underwriting agreements, purchase agreements, and related transaction documents on behalf of their respective clients, and do not give rise to any conflict of interest, ongoing dispute, pending litigation, or ethical bar. No conflict exists.

3.9 Selling Stockholders' Personal Counsel — Whitfield & Garza LLP

Key Individual Searched:

• Patricia Velázquez — Partner

Conflict Check Result: CLEARED. The NMIS search returned no results for Whitfield & Garza LLP. The Firm has not represented Whitfield & Garza in any prior matter, and no adverse representation of any party against Whitfield & Garza was identified. No conflict exists. It bears noting that in this transaction, C&H represents the issuer, PPC, while Whitfield & Garza represents the Selling Stockholders individually. The interests of PPC and the Selling Stockholders are generally aligned in effecting a successful secondary offering; however, the retention of separate counsel is appropriate and customary in selling-stockholder offerings given certain areas of potential divergence between issuer and selling-stockholder interests, most notably with respect to the allocation of indemnification obligations and the apportionment of offering expenses under the underwriting agreement. A more detailed analysis of this structural arrangement is provided in Section 4.2 below.

3.10 Independent Auditors — Graystone & Whitmore LLP

Key Individual Searched:

• Thomas Reiter — Engagement Partner, Audit

Conflict Check Result: CLEARED. The NMIS search returned no results for Graystone & Whitmore LLP. Graystone & Whitmore is a third-party service provider to PPC in its capacity as independent auditor and is not an adverse party in the proposed transaction. As the provider of the comfort letter to the underwriters, Graystone & Whitmore's interests are aligned with those of all transaction participants. No conflict exists.

3.11 Other Parties Searched

In addition to the principal parties described in Sections 3.1 through 3.10 above, the following ancillary parties were identified in connection with the proposed Offering and submitted to the NMIS for conflict checking:

Pinnacle Trust & Transfer Co. — Transfer agent and registrar for PPC's common stock. Pinnacle Trust & Transfer Co. is a New York corporation with offices at 1 Ashbury Asset Advisors Plaza, 30th Floor, New York, NY 10004. Pinnacle Trust & Transfer will facilitate the transfer of shares from the Selling Stockholders to the underwriters (and ultimately to purchasers in the Offering) and will issue any required new certificates or book-entry credits. Conflict Check Result: CLEARED. The NMIS search returned no results. No prior or current representation, and no adverse matters identified.

Apex Financial Printing Inc. — Financial printer engaged by PPC for the preparation and printing (including EDGAR filing) of the prospectus supplement and related offering documents. Apex Financial Printing Inc. is a New York corporation with offices at 55 Water Street, New York, NY 10041. Conflict Check Result: CLEARED. The NMIS search returned no results. No prior or current representation, and no adverse matters identified.

Atlantic Omnivrel Insurance Co. — PPC's directors' and officers' liability insurance carrier. Atlantic Omnivrel Insurance Co. is a Connecticut corporation headquartered in Stamford, Connecticut. Atlantic Fidelity provides PPC's primary D&O coverage, which is relevant to the Offering insofar as the D&O policy provides coverage for securities offering liability, including claims arising under the Securities Act of 1933 and the Securities Exchange Act of 1934. Conflict Check Result: CLEARED. The NMIS search returned no results. No prior or current representation of Atlantic Fidelity by C&H, and no adverse matters involving Atlantic Fidelity, were identified.

4. Analysis of Potential Issues

Although all parties have been cleared through the Firm's conflict check system, three matters warrant additional discussion to ensure that the record is complete and that the responsible partners are informed of circumstances that, while not giving rise to any conflict, merit awareness and documentation.

4.1 Prior Representation of Ridgeline Securities LLC

As noted in Section 3.3 above, C&H previously represented Ridgeline Securities LLC on two matters, both of which are closed and unrelated to PPC, the Castellano family, or the pharmaceutical industry:

(a) A convertible notes offering for Velaris Therapeutics, Inc. in 2022 (Matter No. 1018-00001), in which Ridgeline served as initial purchaser; and

(b) A buyside M&A advisory engagement involving Elysian Data Systems, Inc. in 2021 (Matter No. 1018-00001), in which Ridgeline served as financial advisor.

Both matters were fully concluded and the engagement letters terminated. No retainer, standing engagement letter, or other ongoing agreement exists between C&H and Ridgeline Securities. Ridgeline Securities is not a current client of the Firm within the meaning of NYRPC Rule 1.7, and the analysis therefore proceeds under NYRPC Rule 1.9 (Duties to Former Clients).

Under Rule 1.9(a), a lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client, unless the former client gives informed consent confirmed in writing. Neither of the two prior matters involving Ridgeline is the same as, or substantially related to, the proposed PPC secondary offering. The prior matters involved different issuers, different industries, different transaction structures, and different counterparties. No confidential information obtained during either prior representation could reasonably be used to the disadvantage of Ridgeline in the current transaction.

Moreover, even assuming arguendo that Rule 1.9 applied, there is no material adversity between PPC and Ridgeline Securities in this transaction. As lead left book-runner, Ridgeline's economic and reputational interests are aligned with PPC's interest in a successful, orderly offering. Both parties are working cooperatively toward the same objective. Ridgeline has its own counsel, Caldwell, Pearce & Strauss LLP, which will represent the underwriting syndicate's interests and negotiate the underwriting agreement on Ridgeline's behalf. The negotiation of the underwriting agreement, while involving certain arm's-length terms (such as the scope of issuer representations and warranties and the terms of the indemnification provisions), is a customary commercial negotiation between aligned parties and does not constitute adversity within the meaning of the conflict of interest rules.

Conclusion: No conflict exists under either Rule 1.7 or Rule 1.9. No waiver or informed consent from Ridgeline Securities is required. The prior representations are documented here for completeness.

4.2 Issuer vs. Selling Stockholder Interests

C&H represents PPC as the issuer in this Offering. The Selling Stockholders — Dr. Elena Castellano, Dr. Riccardo Castellano, Dr. Marco Castellano, and Castellano Family Holdings LLC — are separately represented by Whitfield & Garza LLP, under the supervision of Patricia Velázquez, Partner. This parallel representation structure is standard and customary in selling-stockholder secondary offerings and is expressly contemplated by the engagement letter between C&H and PPC.

While the interests of the issuer and the selling stockholders are generally aligned in effecting a successful offering, there are certain areas in which those interests may diverge or require independent negotiation:

(a) Indemnification Provisions in the Underwriting Agreement. The underwriting agreement will contain customary indemnification provisions pursuant to which PPC, as issuer, will indemnify the underwriters against liabilities arising from material misstatements or omissions in the registration statement and prospectus attributable to information provided by or on behalf of PPC. Separately, the Selling Stockholders will indemnify the underwriters against liabilities arising from material misstatements or omissions attributable to information provided by or on behalf of the Selling Stockholders (principally, the selling stockholder questionnaires). The allocation of indemnification responsibility between PPC and the Selling Stockholders is a matter on which the two groups have distinct interests, and it is appropriate that each be independently represented in negotiating these provisions.

(b) Allocation of Offering Expenses. The current understanding among the parties is that PPC will bear the issuer-related expenses of the Offering (including legal fees, accounting fees, SEC filing fees, printing costs, and transfer agent fees), estimated at approximately $765,000. The Selling Stockholders will bear the underwriting discount, which at the customary rate of 4.0% of the gross proceeds would amount to approximately $10,400,000 (or, if the discount is 2.5% of the gross proceeds reflecting the fact that this is a secondary offering, approximately $6,500,000). The allocation of these expenses as between PPC and the Selling Stockholders is governed by the terms of the registration rights agreement previously entered into by PPC and the Castellano family, and any disputes regarding expense allocation would need to be resolved between PPC and the Selling Stockholders with the benefit of independent counsel on each side.

(c) Scope of Lock-Up Agreements. In connection with the Offering, the underwriters may request that PPC and the Selling Stockholders enter into lock-up agreements restricting sales of PPC common stock for a period following the Offering (typically 60 to 90 days for a secondary offering). The terms and scope of any such lock-up agreements may differ as between PPC (which would be restricted from issuing new shares) and the Selling Stockholders (who would be restricted from selling existing shares), and each party should be independently advised regarding the implications of such restrictions.

C&H will not provide legal advice to any member of the Castellano family in his or her individual capacity. Any individual legal questions or concerns raised by the Selling Stockholders — including, without limitation, questions relating to personal tax planning, estate planning, compliance with Section 16 reporting obligations (to the extent applicable), or the terms of the selling stockholder questionnaire — will be referred to Whitfield & Garza LLP. C&H's representation of PPC encompasses the corporate-level actions required in connection with the Offering (such as the preparation and filing of the prospectus supplement, the drafting and negotiation of the underwriting agreement on PPC's behalf, the preparation of board resolutions and officer certificates, and coordination with PPC's auditors regarding the comfort letter) but does not extend to representation of the Selling Stockholders or to advice regarding the Selling Stockholders' personal interests.

Conclusion: No conflict exists. The separate representation of PPC by C&H and of the Selling Stockholders by Whitfield & Garza LLP is the standard and appropriate structure for a selling-stockholder secondary offering. No waiver or informed consent is required.

4.3 Dr. Marco Castellano — Dual Role as CEO and Selling Stockholder

Dr. Marco Castellano occupies a dual role in this transaction: he serves as Chief Executive Officer of PPC (and thus is a principal officer of C&H's client) and is simultaneously a Selling Stockholder (selling 500,000 of his 4,500,000 shares in the Offering). This dual role is commonplace in selling-stockholder offerings involving founder-led companies and does not, in itself, give rise to a conflict of interest, provided that the representation is properly structured.

C&H represents PPC and, by extension, its officers and directors in their official capacities. C&H will interact with Dr. Marco Castellano in his capacity as CEO of PPC for purposes of coordinating the company's participation in the Offering, including the review and approval of the prospectus supplement, the execution of the underwriting agreement, and the delivery of the CEO certification required at closing. In all of these interactions, Dr. Marco Castellano will be acting in his capacity as an officer of PPC, and C&H's advice will be directed to PPC as the entity client.

Dr. Marco Castellano's personal sale of 500,000 shares in the Offering is governed by his own personal counsel, Whitfield & Garza LLP. C&H will not advise Dr. Marco Castellano on any matter relating to his individual sale, including (without limitation) the terms of his selling stockholder questionnaire, the tax consequences of his sale, the impact of the sale on his Section 16 reporting obligations, or any personal indemnification obligations he may assume under the underwriting agreement. To the extent that Dr. Marco Castellano raises any question or concern in a conversation with C&H attorneys that pertains to his individual interests as a Selling Stockholder rather than his official duties as CEO of PPC, C&H will refer the matter to Whitfield & Garza LLP.

This bifurcation of representation has been discussed with David Orenstein, PPC's General Counsel and Corporate Secretary, who has confirmed that PPC understands and accepts the scope of C&H's engagement. Patricia Velázquez of Whitfield & Garza LLP has likewise been informed of the scope of C&H's engagement.

Conclusion: No conflict exists. The bifurcation of representation between C&H (representing PPC and its officers in their official capacities) and Whitfield & Garza LLP (representing the Selling Stockholders, including Dr. Marco Castellano, in their individual capacities) is standard, appropriate, and well understood by all parties. No waiver or informed consent is required.

5. Clearance Determination

Based on the conflict check procedures described in Section 2 and the detailed party-by-party results set forth in Section 3, and taking into account the analysis of potential issues discussed in Section 4, the undersigned has determined the following:

1. All parties identified in connection with the proposed engagement of C&H as issuer's counsel to Penterra Pharmaceuticals Corp. in the selling-stockholder secondary offering have been cleared through the Firm's conflict check system (NMIS).

2. No current client conflict exists within the meaning of NYRPC Rule 1.7. None of the parties on the opposite side of the transaction from PPC — including the underwriters, the Selling Stockholders, or their respective counsel — is a current client of C&H.

3. No former client conflict exists within the meaning of NYRPC Rule 1.9. While C&H previously represented Ridgeline Securities LLC on two unrelated, closed matters, the proposed representation of PPC is not the same as, or substantially related to, either prior matter, and no material adversity exists between PPC and Ridgeline in this transaction.

4. No imputed conflict exists within the meaning of NYRPC Rule 1.10. No member of the proposed deal team has a personal conflict that would be imputed to the Firm.

5. No ethical walls, information barriers, or screening protocols are required or recommended in connection with this engagement.

6. No waivers of conflict or informed consents from any party are required.

7. The matter is cleared to proceed.

6. Recommendation

Based on the foregoing analysis, the undersigned recommends as follows:

The engagement of Calderwood & Harkness LLP as issuer's counsel to Penterra Pharmaceuticals Corp. in connection with the selling-stockholder secondary offering described herein is approved from a conflicts perspective. No impediment to the Firm's representation of PPC in this transaction has been identified.

The engagement letter dated September 5, 2023, between Calderwood & Harkness LLP and Penterra Pharmaceuticals Corp., providing for a capped fee of $485,000 plus disbursements, has been executed and the matter may be staffed immediately. The proposed staffing for this engagement is as follows:

It is anticipated that the prospectus supplement will be filed within the next seven to ten business days, with pricing and closing to follow shortly thereafter, subject to market conditions and the Selling Stockholders' timing preferences. The deal team should coordinate promptly with David Orenstein (PPC General Counsel), Caldwell, Pearce & Strauss LLP (underwriters' counsel), and Whitfield & Garza LLP (selling stockholders' counsel) to establish a timeline and begin preparation of the transaction documents.

7. Certification and Approval

This conflict check memorandum was prepared by the undersigned in accordance with the Firm's New Matter Intake procedures and is submitted for review and approval by the responsible partner.

Prepared by:

BRENDAN WALSH Associate, Capital Markets Group Calderwood & Harkness LLP

Signature: ________

Date: September 5, 2023

Reviewed and Approved by:

JENNIFER KWON Partner, Capital Markets Group Calderwood & Harkness LLP

Signature: ________

Date: ________

DISTRIBUTION: This memorandum is privileged and confidential attorney work product. It is intended solely for the internal use of Calderwood & Harkness LLP in connection with the Firm's conflicts review procedures. A copy of this memorandum has been retained in the Firm's Conflicts/New Business files under Matter No. 1018-00001. This memorandum should not be disclosed to any person outside the Firm without the prior written approval of the Firm's General Counsel.

Field	Detail
Full Legal Name	Penterra Pharmaceuticals Corp.
Short Names / Aliases	Penterra, PPC, PNTR
Entity Type / Jurisdiction	Corporation organized under the laws of the State of Delaware
CIK Number	0001987654
EIN	82-4039571
Headquarters	400 Meridian Parkway, Suite 1200, Princeton, NJ 08540
Delaware Registered Agent	Actionaltional Registered Agents Inc., 251 Little Falls Drive, Wilmington, DE 19808
Role in Transaction	Issuer (no shares being sold by PPC; cooperation and facilitation role only)
Field	Detail
Full Legal Name	Ridgeline Securities LLC
Entity Type / Jurisdiction	Limited liability company organized under the laws of the State of Delaware
Address	383 Madison Avenue, New York, NY 10017
Role in Transaction	Lead left book-runner for the secondary offering; also an IPO lock-up party (lock-up waiver grantor)
Field	Detail
Full Legal Name	Broadmark Capital Inc.
Entity Type / Jurisdiction	Corporation organized under the laws of the State of Delaware
Address	200 Park Avenue, New York, NY 10166
Role in Transaction	Joint book-runner for the secondary offering; also an IPO lock-up party (lock-up waiver grantor)
Field	Detail
Full Legal Name	Linden Groves & Co.
Entity Type / Jurisdiction	Partnership organized under the laws of the State of New York
Address	745 Fifth Avenue, New York, NY 10151
Role in Transaction	Co-Manager in the underwriting syndicate
Field	Detail

Full Legal Name	Harborview Partners LLC
Entity Type / Jurisdiction	Limited liability company organized under the laws of the State of Delaware
Address	1 Federal Street, Boston, MA 02110
Role in Transaction	Co-Manager in the underwriting syndicate
Field	Detail
Full Legal Name	Morningstar Zanthor & Co.
Entity Type / Jurisdiction	Partnership organized under the laws of the State of New York
Address	600 Lexington Avenue, New York, NY 10022
Role in Transaction	IPO co-manager and lock-up party; consent required for early release of 180-day lock-up; NOT participating as underwriter in the secondary offering
Field	Detail
Full Legal Name	Caldwell, Pearce & Strauss LLP
Entity Type / Jurisdiction	Limited liability partnership organized under the laws of the State of New York
Address	1251 Avenue of the Americas, 40th Floor, New York, NY 10020
Role in Transaction	Counsel to the underwriters (Ridgeline Securities LLC, Broadmark Capital Inc., Linden Groves & Co., and Harborview Partners LLC)
Field	Detail
Full Legal Name	Whitfield & Garza LLP
Entity Type / Jurisdiction	Limited liability partnership organized under the laws of the State of New York
Address	590 Madison Avenue, 28th Floor, New York, NY 10022
Role in Transaction	Personal counsel to the Castellano family selling stockholders
Field	Detail
Full Legal Name	Graystone & Whitmore LLP
Entity Type / Jurisdiction	Limited liability partnership organized under the laws of the State of New York
Address	30 Rockefeller Plaza, New York, NY 10112
Role in Transaction	Independent registered public accounting firm for PPC; comfort letter provider
Role	Attorney

Responsible Partner	Jennifer Kwon
Billing Partner	Theodore Langston
Lead Associate	Audrey Zhou
Working Associate	Brendan Walsh

MEMORANDUM
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
FROM: Brendan Walsh, Associate, Capital Markets Group
TO: Jennifer Kwon, Partner, Capital Markets Group Theodore Langston, Partner, Capital Markets Group
CC: Audrey Zhou, Senior Associate, Capital Markets Group
DATE: September 5, 2023
RE: Conflict Check Results — Penterra Pharmaceuticals Corp. Selling-Stockholder Secondary Offering
MATTER NO.: 1018-00001
1. Purpose of Memorandum
This memorandum documents the conflict check procedures undertaken and the results obtained in connection with the proposed engagement of Calderwood & Harkness LLP ("C&H" or the "Firm") as issuer's counsel to Penterra Pharmaceuticals Corp. ("PPC" or "Penterra") in a registered selling-stockholder secondary offering of shares of PPC common stock (the "Offering"). The Offering will consist of the sale by certain members of the Castellano founding family (collectively, the "Selling Stockholders") of an aggregate of 6,250,000 shares of PPC common stock at an estimated public offering price of approximately $41.60 per share, for an estimated aggregate deal value of approximately $260,000,000.
PPC is a Delaware corporation, publicly traded on the Nasdaq Global Select Market under the ticker symbol "PNTR." The company's principal executive offices are located at 400 Meridian Parkway, Suite 1200, Princeton, New Jersey 08540. PPC is a clinical-stage pharmaceutical company with a portfolio of oncology and immunology therapeutics. The company completed its initial public offering in February 2023 and has been publicly reporting since that time.
The Offering is structured as a shelf takedown under PPC's existing shelf registration statement on Form S-3 (File No. 333-274851), which was filed with the Securities and Exchange Commission (the "SEC") on August 10, 2023 and declared effective on August 22, 2023. The Offering will be effected by means of a prospectus supplement to be filed with the SEC pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the "Securities Act"). No primary shares will be offered by PPC, and PPC will not receive any proceeds from the sale of shares by the Selling Stockholders. PPC's role in the transaction is limited to cooperation and facilitation of the Offering, including providing customary issuer representations and warranties in the underwriting agreement, furnishing officer certificates and other closing deliverables, and filing all necessary documents with the SEC.
The engagement was opened on September 5, 2023. The engagement letter between C&H and PPC was fully executed on the same date. The engagement provides for a capped fee of $485,000 plus reasonable out-of-pocket disbursements, which fee arrangement reflects the limited scope of issuer-side work in a selling-stockholder secondary offering where the registration statement is already effective and the company's periodic reporting is current.
This memorandum is intended to serve as the Firm's record of the conflict check performed in connection with this new matter, in compliance with the Firm's policies and procedures for new matter intake, as well as applicable provisions of the New York Rules of Professional Conduct (the "NYRPC"), including Rules 1.7 (Conflict of Interest: Current Clients), 1.8 (Current Clients: Specific Conflict of Interest Rules), 1.9 (Duties to Former Clients), and 1.10 (Imputation of Conflicts of Interest).
2. Conflict Check Methodology
The Firm conducted a comprehensive conflict check in accordance with its standard New Matter Intake ("NMI") procedures. The following steps were taken on September 5, 2023, prior to execution of the engagement letter:
2.1 Database Search. All parties, principals, and affiliated entities identified in connection with the proposed engagement were submitted to the Firm's conflicts database through the New Matter Intake System ("NMIS"), the Firm's proprietary conflicts and matter management platform. The NMIS contains records of all current and former client representations, adverse parties, related parties, and key individuals associated with matters handled by C&H.
2.2 Search Parameters. Each party was searched using multiple search parameters to maximize the likelihood of identifying potential conflicts. These parameters included: (a) full legal entity name; (b) short names, acronyms, and commonly used trade names or aliases; (c) Nasdaq ticker symbol (where applicable); (d) names of principal individuals associated with each party (including officers, directors, managing directors, engagement partners, and other key contacts); and (e) known affiliated entities and subsidiaries.
2.3 Cross-Reference Against Active and Closed Matters. The search results were cross-referenced against (a) all currently active matters in the NMIS and (b) all matters closed within the preceding twenty-four (24) months. This look-back period exceeds the minimum twelve-month period required by the Firm's internal policies and is consistent with best practices for capital markets engagements involving publicly traded companies and major financial institutions.
2.4 Institutional Client List and Standing Instruction Clients. The search results were reviewed against the Firm's institutional client list, which identifies clients with whom C&H maintains an ongoing relationship and for whom special conflict-checking protocols may apply. The search was further reviewed against the Firm's list of "standing instruction" clients — those clients who have provided advance instructions regarding matters in which C&H may or may not represent other parties.
2.5 Ethical Walls and Screening Protocols. The conflict check confirmed that no ethical walls, information barriers, or screening protocols are currently in effect at C&H with respect to any party identified in connection with the proposed engagement. No member of the proposed deal team is subject to any recusal or screening obligation that would affect the Firm's ability to represent PPC in this transaction.
2.6 Verification and Sign-Off. The results of the conflict check were reviewed by the undersigned, verified against publicly available information (including SEC filings, Nasdaq listing records, and the Delaware Division of Corporations database), and submitted for approval to the responsible partner, Jennifer Kwon.
3. Parties Searched and Results
Set forth below is a detailed summary of each party searched, including full identifying information, the party's role in the proposed transaction, and the results of the conflict check.
3.1 The Issuer — Penterra Pharmaceuticals Corp.
Key Individuals Searched:
•  Dr. Marco Castellano — Chief Executive Officer
•  Lisa Hargrove — Chief Financial Officer
•  David Orenstein — General Counsel and Corporate Secretary
•  Dr. Elena Castellano — Chair of the Board of Directors
Conflict Check Result: CLEARED. The Firm has not represented PPC in any prior matter. No adverse representation of any party against PPC was identified in the NMIS. No current or former client relationship exists between C&H and PPC. PPC is being onboarded as a new client of the Firm in connection with this engagement. Standard new-client due diligence procedures have been completed, including verification of PPC's good standing in Delaware, confirmation of signing authority for the engagement letter (David Orenstein, General Counsel, pursuant to board authorization), and completion of the Firm's anti-money laundering and know-your-client questionnaire.
3.2 Selling Stockholders — The Castellano Family
The Selling Stockholders in the proposed Offering consist of three individual members of the Castellano founding family and one family holding vehicle, as follows:
Dr. Elena Castellano — Co-Founder of PPC and current Chair of the Board of Directors. Dr. Elena Castellano holds 14,200,000 shares of PPC common stock and proposes to sell 3,000,000 shares in the Offering. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Dr. Elena Castellano will hold 11,200,000 shares, representing approximately 9.3% of the outstanding shares.
Dr. Riccardo Castellano — Co-Founder of PPC and current non-executive member of the Board of Directors. Dr. Riccardo Castellano holds 12,800,000 shares of PPC common stock and proposes to sell 2,500,000 shares in the Offering. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Dr. Riccardo Castellano will hold 10,300,000 shares, representing approximately 8.6% of the outstanding shares.
Dr. Marco Castellano — Son of Dr. Elena Castellano and Dr. Riccardo Castellano, and current Chief Executive Officer of PPC. Dr. Marco Castellano holds 4,500,000 shares of PPC common stock and proposes to sell 500,000 shares in the Offering. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Dr. Marco Castellano will hold 4,000,000 shares, representing approximately 3.3% of the outstanding shares.
Castellano Family Holdings LLC — A Delaware limited liability company formed as a family holding vehicle for shares of PPC common stock. Castellano Family Holdings LLC (EIN: 87-2165438) holds 8,600,000 shares of PPC common stock and proposes to sell 250,000 shares in the Offering. The LLC's address is c/o Penterra Pharmaceuticals Corp., 400 Meridian Parkway, Suite 1200, Princeton, NJ 08540. Following the Offering (assuming no exercise of the underwriters' option to purchase additional shares), Castellano Family Holdings LLC will hold 8,350,000 shares, representing approximately 7.0% of the outstanding shares.
In the aggregate, the Castellano family (including Castellano Family Holdings LLC) holds 40,100,000 shares of PPC common stock prior to the Offering, representing approximately 33.4% of the 120,000,000 shares of PPC common stock currently outstanding. The total base offering by the Selling Stockholders is 6,250,000 shares. Following the completion of the Offering (assuming no exercise of the underwriters' option to purchase additional shares), the Castellano family will hold approximately 33,850,000 shares, representing approximately 28.2% of the outstanding shares.
Role in Transaction: The Castellano family members and Castellano Family Holdings LLC are the Selling Stockholders in the Offering. C&H does not represent the Selling Stockholders individually or as a group. The Selling Stockholders are represented by their own personal counsel, Whitfield & Garza LLP, a New York law firm, under the supervision of Patricia Velázquez, Partner.
Conflict Check Result: CLEARED. The Firm has not represented any Castellano family member — Dr. Elena Castellano, Dr. Riccardo Castellano, or Dr. Marco Castellano — in any individual capacity in any prior matter. The Firm has not represented Castellano Family Holdings LLC in any prior matter. No adverse representation of any party against any member of the Castellano family or Castellano Family Holdings LLC was identified in the NMIS. No conflict exists.
3.3 Lead Left Book-Runner — Ridgeline Securities LLC
Key Individuals Searched:
•  Jonathan Pryce-Hall — Managing Director, Lead Banker on the Penterra engagement
•  Angela Ferris — Vice President, Syndicate Desk
Conflict Check Result: CLEARED. The NMIS search returned two prior matters involving Ridgeline Securities LLC, both of which are closed and unrelated to PPC or the Castellano family:
(a) Matter No. 1018-00001 — Representation of Ridgeline Securities LLC as initial purchaser in a $175 million offering of convertible senior notes due 2027 by Velaris Therapeutics, Inc. (an unrelated pharmaceutical company). Engagement opened March 2022; closed July 2022.
(b) Matter No. 1018-00001 — Representation of Ridgeline Securities LLC as financial advisor on a buyside acquisition of a minority stake in Elysian Data Systems, Inc. Engagement opened September 2021; closed December 2021.
Both of these prior representations have been fully concluded. No engagement letter or retainer agreement is currently in effect between C&H and Ridgeline Securities. Ridgeline Securities is not a current client of the Firm. In the proposed Offering, Ridgeline Securities and PPC have aligned interests — Ridgeline acts as lead left book-runner and PPC acts as issuer, and both parties share an interest in the successful execution and completion of the Offering. Ridgeline Securities is represented by its own counsel, Caldwell, Pearce & Strauss LLP, in connection with this transaction. No adversity between C&H's representation of PPC and Ridgeline's interests is anticipated. A more detailed analysis of this matter is set forth in Section 4.1 below.
3.4 Joint Book-Runner — Broadmark Capital Inc.
Key Individual Searched:
•  Samuel Okonkwo — Managing Director
Conflict Check Result: CLEARED. The NMIS search returned no results for Broadmark Capital Inc. The Firm has not represented Broadmark Capital in any prior matter, and no adverse representation of any party against Broadmark Capital was identified. No conflict exists.
3.5 Co-Manager — Linden Groves & Co.
Conflict Check Result: CLEARED. The NMIS search returned no results for Linden Groves & Co. The Firm has not represented Linden Groves in any prior matter, and no adverse representation of any party against Linden Groves was identified. No conflict exists.
3.6 Co-Manager — Harborview Partners LLC
Conflict Check Result: CLEARED. The NMIS search returned no results for Harborview Partners LLC. The Firm has not represented Harborview Partners in any prior matter, and no adverse representation of any party against Harborview Partners was identified. No conflict exists.
3.7 IPO Co-Manager / Lock-Up Party — Morningstar Zanthor & Co.
Key Individual Searched:
•  Diane Chaudhary — Managing Director
Morningstar Zanthor served as a co-manager in PPC's February 2023 initial public offering and is a party to the lock-up agreements executed in connection therewith. The 180-day lock-up period under those agreements does not expire until approximately August 2023, and the Selling Stockholders require a waiver or early release from Morningstar Zanthor (in addition to Ridgeline Securities and Broadmark Capital, the other lock-up parties) in order to proceed with the Offering. Morningstar Zanthor is not participating as an underwriter in the secondary offering.
Conflict Check Result: CLEARED. The NMIS search returned no results for Morningstar Zanthor & Co. The Firm has not represented Morningstar Zanthor in any prior matter, and no adverse representation of any party against Morningstar Zanthor was identified. No conflict exists.
3.8 Underwriters' Counsel — Caldwell, Pearce & Strauss LLP
Key Individuals Searched:
•  Margaret Hui — Partner, Capital Markets Group
•  Ryan Petrosian — Associate, Capital Markets Group
Conflict Check Result: CLEARED. C&H and Caldwell, Pearce & Strauss LLP have worked on opposite sides of prior capital markets transactions, which is customary and expected given the prominence of both firms in the capital markets practice area. These prior interactions involved arm's-length negotiations of underwriting agreements, purchase agreements, and related transaction documents on behalf of their respective clients, and do not give rise to any conflict of interest, ongoing dispute, pending litigation, or ethical bar. No conflict exists.
3.9 Selling Stockholders' Personal Counsel — Whitfield & Garza LLP
Key Individual Searched:
•  Patricia Velázquez — Partner
Conflict Check Result: CLEARED. The NMIS search returned no results for Whitfield & Garza LLP. The Firm has not represented Whitfield & Garza in any prior matter, and no adverse representation of any party against Whitfield & Garza was identified. No conflict exists. It bears noting that in this transaction, C&H represents the issuer, PPC, while Whitfield & Garza represents the Selling Stockholders individually. The interests of PPC and the Selling Stockholders are generally aligned in effecting a successful secondary offering; however, the retention of separate counsel is appropriate and customary in selling-stockholder offerings given certain areas of potential divergence between issuer and selling-stockholder interests, most notably with respect to the allocation of indemnification obligations and the apportionment of offering expenses under the underwriting agreement. A more detailed analysis of this structural arrangement is provided in Section 4.2 below.
3.10 Independent Auditors — Graystone & Whitmore LLP
Key Individual Searched:
•  Thomas Reiter — Engagement Partner, Audit
Conflict Check Result: CLEARED. The NMIS search returned no results for Graystone & Whitmore LLP. Graystone & Whitmore is a third-party service provider to PPC in its capacity as independent auditor and is not an adverse party in the proposed transaction. As the provider of the comfort letter to the underwriters, Graystone & Whitmore's interests are aligned with those of all transaction participants. No conflict exists.
3.11 Other Parties Searched
In addition to the principal parties described in Sections 3.1 through 3.10 above, the following ancillary parties were identified in connection with the proposed Offering and submitted to the NMIS for conflict checking:
Pinnacle Trust & Transfer Co. — Transfer agent and registrar for PPC's common stock. Pinnacle Trust & Transfer Co. is a New York corporation with offices at 1 Ashbury Asset Advisors Plaza, 30th Floor, New York, NY 10004. Pinnacle Trust & Transfer will facilitate the transfer of shares from the Selling Stockholders to the underwriters (and ultimately to purchasers in the Offering) and will issue any required new certificates or book-entry credits. Conflict Check Result: CLEARED. The NMIS search returned no results. No prior or current representation, and no adverse matters identified.
Apex Financial Printing Inc. — Financial printer engaged by PPC for the preparation and printing (including EDGAR filing) of the prospectus supplement and related offering documents. Apex Financial Printing Inc. is a New York corporation with offices at 55 Water Street, New York, NY 10041. Conflict Check Result: CLEARED. The NMIS search returned no results. No prior or current representation, and no adverse matters identified.
Atlantic Omnivrel Insurance Co. — PPC's directors' and officers' liability insurance carrier. Atlantic Omnivrel Insurance Co. is a Connecticut corporation headquartered in Stamford, Connecticut. Atlantic Fidelity provides PPC's primary D&O coverage, which is relevant to the Offering insofar as the D&O policy provides coverage for securities offering liability, including claims arising under the Securities Act of 1933 and the Securities Exchange Act of 1934. Conflict Check Result: CLEARED. The NMIS search returned no results. No prior or current representation of Atlantic Fidelity by C&H, and no adverse matters involving Atlantic Fidelity, were identified.
4. Analysis of Potential Issues
Although all parties have been cleared through the Firm's conflict check system, three matters warrant additional discussion to ensure that the record is complete and that the responsible partners are informed of circumstances that, while not giving rise to any conflict, merit awareness and documentation.
4.1 Prior Representation of Ridgeline Securities LLC
As noted in Section 3.3 above, C&H previously represented Ridgeline Securities LLC on two matters, both of which are closed and unrelated to PPC, the Castellano family, or the pharmaceutical industry:
(a) A convertible notes offering for Velaris Therapeutics, Inc. in 2022 (Matter No. 1018-00001), in which Ridgeline served as initial purchaser; and
(b) A buyside M&A advisory engagement involving Elysian Data Systems, Inc. in 2021 (Matter No. 1018-00001), in which Ridgeline served as financial advisor.
Both matters were fully concluded and the engagement letters terminated. No retainer, standing engagement letter, or other ongoing agreement exists between C&H and Ridgeline Securities. Ridgeline Securities is not a current client of the Firm within the meaning of NYRPC Rule 1.7, and the analysis therefore proceeds under NYRPC Rule 1.9 (Duties to Former Clients).
Under Rule 1.9(a), a lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client, unless the former client gives informed consent confirmed in writing. Neither of the two prior matters involving Ridgeline is the same as, or substantially related to, the proposed PPC secondary offering. The prior matters involved different issuers, different industries, different transaction structures, and different counterparties. No confidential information obtained during either prior representation could reasonably be used to the disadvantage of Ridgeline in the current transaction.
Moreover, even assuming arguendo that Rule 1.9 applied, there is no material adversity between PPC and Ridgeline Securities in this transaction. As lead left book-runner, Ridgeline's economic and reputational interests are aligned with PPC's interest in a successful, orderly offering. Both parties are working cooperatively toward the same objective. Ridgeline has its own counsel, Caldwell, Pearce & Strauss LLP, which will represent the underwriting syndicate's interests and negotiate the underwriting agreement on Ridgeline's behalf. The negotiation of the underwriting agreement, while involving certain arm's-length terms (such as the scope of issuer representations and warranties and the terms of the indemnification provisions), is a customary commercial negotiation between aligned parties and does not constitute adversity within the meaning of the conflict of interest rules.
Conclusion: No conflict exists under either Rule 1.7 or Rule 1.9. No waiver or informed consent from Ridgeline Securities is required. The prior representations are documented here for completeness.
4.2 Issuer vs. Selling Stockholder Interests
C&H represents PPC as the issuer in this Offering. The Selling Stockholders — Dr. Elena Castellano, Dr. Riccardo Castellano, Dr. Marco Castellano, and Castellano Family Holdings LLC — are separately represented by Whitfield & Garza LLP, under the supervision of Patricia Velázquez, Partner. This parallel representation structure is standard and customary in selling-stockholder secondary offerings and is expressly contemplated by the engagement letter between C&H and PPC.
While the interests of the issuer and the selling stockholders are generally aligned in effecting a successful offering, there are certain areas in which those interests may diverge or require independent negotiation:
(a) Indemnification Provisions in the Underwriting Agreement. The underwriting agreement will contain customary indemnification provisions pursuant to which PPC, as issuer, will indemnify the underwriters against liabilities arising from material misstatements or omissions in the registration statement and prospectus attributable to information provided by or on behalf of PPC. Separately, the Selling Stockholders will indemnify the underwriters against liabilities arising from material misstatements or omissions attributable to information provided by or on behalf of the Selling Stockholders (principally, the selling stockholder questionnaires). The allocation of indemnification responsibility between PPC and the Selling Stockholders is a matter on which the two groups have distinct interests, and it is appropriate that each be independently represented in negotiating these provisions.
(b) Allocation of Offering Expenses. The current understanding among the parties is that PPC will bear the issuer-related expenses of the Offering (including legal fees, accounting fees, SEC filing fees, printing costs, and transfer agent fees), estimated at approximately $765,000. The Selling Stockholders will bear the underwriting discount, which at the customary rate of 4.0% of the gross proceeds would amount to approximately $10,400,000 (or, if the discount is 2.5% of the gross proceeds reflecting the fact that this is a secondary offering, approximately $6,500,000). The allocation of these expenses as between PPC and the Selling Stockholders is governed by the terms of the registration rights agreement previously entered into by PPC and the Castellano family, and any disputes regarding expense allocation would need to be resolved between PPC and the Selling Stockholders with the benefit of independent counsel on each side.
(c) Scope of Lock-Up Agreements. In connection with the Offering, the underwriters may request that PPC and the Selling Stockholders enter into lock-up agreements restricting sales of PPC common stock for a period following the Offering (typically 60 to 90 days for a secondary offering). The terms and scope of any such lock-up agreements may differ as between PPC (which would be restricted from issuing new shares) and the Selling Stockholders (who would be restricted from selling existing shares), and each party should be independently advised regarding the implications of such restrictions.
C&H will not provide legal advice to any member of the Castellano family in his or her individual capacity. Any individual legal questions or concerns raised by the Selling Stockholders — including, without limitation, questions relating to personal tax planning, estate planning, compliance with Section 16 reporting obligations (to the extent applicable), or the terms of the selling stockholder questionnaire — will be referred to Whitfield & Garza LLP. C&H's representation of PPC encompasses the corporate-level actions required in connection with the Offering (such as the preparation and filing of the prospectus supplement, the drafting and negotiation of the underwriting agreement on PPC's behalf, the preparation of board resolutions and officer certificates, and coordination with PPC's auditors regarding the comfort letter) but does not extend to representation of the Selling Stockholders or to advice regarding the Selling Stockholders' personal interests.
Conclusion: No conflict exists. The separate representation of PPC by C&H and of the Selling Stockholders by Whitfield & Garza LLP is the standard and appropriate structure for a selling-stockholder secondary offering. No waiver or informed consent is required.
4.3 Dr. Marco Castellano — Dual Role as CEO and Selling Stockholder
Dr. Marco Castellano occupies a dual role in this transaction: he serves as Chief Executive Officer of PPC (and thus is a principal officer of C&H's client) and is simultaneously a Selling Stockholder (selling 500,000 of his 4,500,000 shares in the Offering). This dual role is commonplace in selling-stockholder offerings involving founder-led companies and does not, in itself, give rise to a conflict of interest, provided that the representation is properly structured.
C&H represents PPC and, by extension, its officers and directors in their official capacities. C&H will interact with Dr. Marco Castellano in his capacity as CEO of PPC for purposes of coordinating the company's participation in the Offering, including the review and approval of the prospectus supplement, the execution of the underwriting agreement, and the delivery of the CEO certification required at closing. In all of these interactions, Dr. Marco Castellano will be acting in his capacity as an officer of PPC, and C&H's advice will be directed to PPC as the entity client.
Dr. Marco Castellano's personal sale of 500,000 shares in the Offering is governed by his own personal counsel, Whitfield & Garza LLP. C&H will not advise Dr. Marco Castellano on any matter relating to his individual sale, including (without limitation) the terms of his selling stockholder questionnaire, the tax consequences of his sale, the impact of the sale on his Section 16 reporting obligations, or any personal indemnification obligations he may assume under the underwriting agreement. To the extent that Dr. Marco Castellano raises any question or concern in a conversation with C&H attorneys that pertains to his individual interests as a Selling Stockholder rather than his official duties as CEO of PPC, C&H will refer the matter to Whitfield & Garza LLP.
This bifurcation of representation has been discussed with David Orenstein, PPC's General Counsel and Corporate Secretary, who has confirmed that PPC understands and accepts the scope of C&H's engagement. Patricia Velázquez of Whitfield & Garza LLP has likewise been informed of the scope of C&H's engagement.
Conclusion: No conflict exists. The bifurcation of representation between C&H (representing PPC and its officers in their official capacities) and Whitfield & Garza LLP (representing the Selling Stockholders, including Dr. Marco Castellano, in their individual capacities) is standard, appropriate, and well understood by all parties. No waiver or informed consent is required.
5. Clearance Determination
Based on the conflict check procedures described in Section 2 and the detailed party-by-party results set forth in Section 3, and taking into account the analysis of potential issues discussed in Section 4, the undersigned has determined the following:
1.  All parties identified in connection with the proposed engagement of C&H as issuer's counsel to Penterra Pharmaceuticals Corp. in the selling-stockholder secondary offering have been cleared through the Firm's conflict check system (NMIS).
2.  No current client conflict exists within the meaning of NYRPC Rule 1.7. None of the parties on the opposite side of the transaction from PPC — including the underwriters, the Selling Stockholders, or their respective counsel — is a current client of C&H.
3.  No former client conflict exists within the meaning of NYRPC Rule 1.9. While C&H previously represented Ridgeline Securities LLC on two unrelated, closed matters, the proposed representation of PPC is not the same as, or substantially related to, either prior matter, and no material adversity exists between PPC and Ridgeline in this transaction.
4.  No imputed conflict exists within the meaning of NYRPC Rule 1.10. No member of the proposed deal team has a personal conflict that would be imputed to the Firm.
5.  No ethical walls, information barriers, or screening protocols are required or recommended in connection with this engagement.
6.  No waivers of conflict or informed consents from any party are required.
7.  The matter is cleared to proceed.
6. Recommendation
Based on the foregoing analysis, the undersigned recommends as follows:
The engagement of Calderwood & Harkness LLP as issuer's counsel to Penterra Pharmaceuticals Corp. in connection with the selling-stockholder secondary offering described herein is approved from a conflicts perspective. No impediment to the Firm's representation of PPC in this transaction has been identified.
The engagement letter dated September 5, 2023, between Calderwood & Harkness LLP and Penterra Pharmaceuticals Corp., providing for a capped fee of $485,000 plus disbursements, has been executed and the matter may be staffed immediately. The proposed staffing for this engagement is as follows:
It is anticipated that the prospectus supplement will be filed within the next seven to ten business days, with pricing and closing to follow shortly thereafter, subject to market conditions and the Selling Stockholders' timing preferences. The deal team should coordinate promptly with David Orenstein (PPC General Counsel), Caldwell, Pearce & Strauss LLP (underwriters' counsel), and Whitfield & Garza LLP (selling stockholders' counsel) to establish a timeline and begin preparation of the transaction documents.
7. Certification and Approval
This conflict check memorandum was prepared by the undersigned in accordance with the Firm's New Matter Intake procedures and is submitted for review and approval by the responsible partner.
Prepared by:
BRENDAN WALSH Associate, Capital Markets Group Calderwood & Harkness LLP
Signature: ________
Date: September 5, 2023
Reviewed and Approved by:
JENNIFER KWON Partner, Capital Markets Group Calderwood & Harkness LLP
Signature: ________
Date: ________
DISTRIBUTION: This memorandum is privileged and confidential attorney work product. It is intended solely for the internal use of Calderwood & Harkness LLP in connection with the Firm's conflicts review procedures. A copy of this memorandum has been retained in the Firm's Conflicts/New Business files under Matter No. 1018-00001. This memorandum should not be disclosed to any person outside the Firm without the prior written approval of the Firm's General Counsel.
Field | Detail
Full Legal Name | Penterra Pharmaceuticals Corp.
Short Names / Aliases | Penterra, PPC, PNTR
Entity Type / Jurisdiction | Corporation organized under the laws of the State of Delaware
CIK Number | 0001987654
EIN | 82-4039571
Headquarters | 400 Meridian Parkway, Suite 1200, Princeton, NJ 08540
Delaware Registered Agent | Actionaltional Registered Agents Inc., 251 Little Falls Drive, Wilmington, DE 19808
Role in Transaction | Issuer (no shares being sold by PPC; cooperation and facilitation role only)
Field | Detail
Full Legal Name | Ridgeline Securities LLC
Entity Type / Jurisdiction | Limited liability company organized under the laws of the State of Delaware
Address | 383 Madison Avenue, New York, NY 10017
Role in Transaction | Lead left book-runner for the secondary offering; also an IPO lock-up party (lock-up waiver grantor)
Field | Detail
Full Legal Name | Broadmark Capital Inc.
Entity Type / Jurisdiction | Corporation organized under the laws of the State of Delaware
Address | 200 Park Avenue, New York, NY 10166
Role in Transaction | Joint book-runner for the secondary offering; also an IPO lock-up party (lock-up waiver grantor)
Field | Detail
Full Legal Name | Linden Groves & Co.
Entity Type / Jurisdiction | Partnership organized under the laws of the State of New York
Address | 745 Fifth Avenue, New York, NY 10151
Role in Transaction | Co-Manager in the underwriting syndicate
Field | Detail
Full Legal Name | Harborview Partners LLC
Entity Type / Jurisdiction | Limited liability company organized under the laws of the State of Delaware
Address | 1 Federal Street, Boston, MA 02110
Role in Transaction | Co-Manager in the underwriting syndicate
Field | Detail
Full Legal Name | Morningstar Zanthor & Co.
Entity Type / Jurisdiction | Partnership organized under the laws of the State of New York
Address | 600 Lexington Avenue, New York, NY 10022
Role in Transaction | IPO co-manager and lock-up party; consent required for early release of 180-day lock-up; NOT participating as underwriter in the secondary offering
Field | Detail
Full Legal Name | Caldwell, Pearce & Strauss LLP
Entity Type / Jurisdiction | Limited liability partnership organized under the laws of the State of New York
Address | 1251 Avenue of the Americas, 40th Floor, New York, NY 10020
Role in Transaction | Counsel to the underwriters (Ridgeline Securities LLC, Broadmark Capital Inc., Linden Groves & Co., and Harborview Partners LLC)
Field | Detail
Full Legal Name | Whitfield & Garza LLP
Entity Type / Jurisdiction | Limited liability partnership organized under the laws of the State of New York
Address | 590 Madison Avenue, 28th Floor, New York, NY 10022
Role in Transaction | Personal counsel to the Castellano family selling stockholders
Field | Detail
Full Legal Name | Graystone & Whitmore LLP
Entity Type / Jurisdiction | Limited liability partnership organized under the laws of the State of New York
Address | 30 Rockefeller Plaza, New York, NY 10112
Role in Transaction | Independent registered public accounting firm for PPC; comfort letter provider
Role | Attorney
Responsible Partner | Jennifer Kwon
Billing Partner | Theodore Langston
Lead Associate | Audrey Zhou
Working Associate | Brendan Walsh

MEMORANDUM

MATTER NO.: 1018-00001

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