MORNINGSTAR ZANTHOR & CO. 600 Lexington Avenue New York, NY 10022

September 29, 2023

Penterra Pharmaceuticals Corp. 400 Meridian Parkway, Suite 1200 Princeton, NJ 08540

Attn: David Orenstein, General Counsel & Corporate Secretary

With copies to:

Calderwood & Harkness LLP One Liberty Plaza, 52nd Floor New York, NY 10006

Attn: Jennifer Kwon

Whitfield & Garza LLP 590 Madison Avenue, 28th Floor New York, NY 10022

Attn: Patricia Velázquez

Re: Consent to Early Release of Lock-Up Restrictions — Penterra Pharmaceuticals Corp. Selling-Stockholder Secondary Offering

Dear Mr. Orenstein:

Reference is made to the lock-up agreements (the "Lock-Up Agreements") dated as of April 17, 2023, entered into by certain stockholders, directors, and officers of Penterra Pharmaceuticals Corp., a Delaware corporation ("PPC" or the "Company"), in connection with the Company's initial public offering of shares of its common stock, par value $0.001 per share (the "IPO"), which was priced on April 17, 2023. Morningstar Zanthor & Co. ("Morningstar Zanthor") served as a co-manager of the IPO alongside Ridgeline Securities LLC ("Ridgeline") and Broadmark Capital Inc. ("Broadmark" and, together with Morningstar Zanthor and Ridgeline, the "IPO Underwriters"). The Lock-Up Agreements were entered into with and for the benefit of the IPO Underwriters and, pursuant to their terms, impose restrictions on the sale, transfer, or other disposition of shares of PPC common stock and certain related securities by the signatories thereto for a period of 180 calendar days from April 17, 2023, such lock-up period expiring by its terms on October 14, 2023 (the "Lock-Up Period"). Each of the Lock-Up Agreements provides that the lock-up restrictions contained therein may be waived or released, in whole or in part, prior to the expiration of the Lock-Up Period, with the prior written consent of each of the IPO Underwriters.

Morningstar Zanthor acknowledges receipt of the lock-up waiver request letter from PPC dated September 18, 2023 (the "Request Letter"), requesting that the IPO Underwriters consent to the early release of the lock-up restrictions under the Lock-Up Agreements with respect to the following stockholders of the Company (collectively, the "Selling Stockholders"), in the amounts and on the terms set forth below:

As described in the Request Letter, the Selling Stockholders propose to sell shares of PPC common stock, par value $0.001 per share (Nasdaq: PNTR), in a registered selling-stockholder secondary offering (the "Secondary Offering"). The Secondary Offering is to be effected as a shelf takedown under PPC's existing registration statement on Form S-3 (File No. 333-274851), which was declared effective by the Securities and Exchange Commission on August 22, 2023, with a prospectus supplement to be filed with the Securities and Exchange Commission pursuant to Rule 424(b)(5) under the Securities Act of 1933, as amended. The underwriters for the Secondary Offering will be Ridgeline Securities LLC (lead left book-runner), Broadmark Capital Inc. (joint book-runner), Linden Groves & Co. (co-manager), and Harborview Partners LLC (co-manager). Morningstar Zanthor notes, for the avoidance of doubt, that it is not participating as an underwriter, book-runner, co-manager, or in any other underwriting capacity in connection with the Secondary Offering.

As noted above, the lock-up restrictions under the Lock-Up Agreements expire by their terms on October 14, 2023, which is 180 calendar days from the date of the Lock-Up Agreements. PPC has requested that the lock-up restrictions be released effective as of October 12, 2023 — that is, two calendar days prior to the natural expiration of the Lock-Up Period — in order to permit the pricing and execution of the underwriting agreement for the Secondary Offering (the "Underwriting Agreement") on October 12, 2023, with settlement and closing of the Secondary Offering expected to occur on or about October 17, 2023. Pursuant to the terms of the Lock-Up Agreements, the consent of each of the three IPO Underwriters — Ridgeline Securities LLC, Broadmark Capital Inc., and Morningstar Zanthor & Co. — is required for the early release of the lock-up restrictions applicable to the Selling Stockholders.

Having reviewed the Request Letter and the terms and circumstances of the proposed Secondary Offering, and in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Morningstar Zanthor & Co. hereby consents to the early release of the lock-up restrictions under the Lock-Up Agreements applicable to each of the Selling Stockholders identified above, effective as of October 12, 2023 (the "Waiver Effective Date"). This consent and waiver is granted solely with respect to (i) up to 6,250,000 shares of PPC common stock to be sold by the Selling Stockholders in the base Secondary Offering in the amounts set forth in the table above, plus (ii) up to 937,500 additional shares of PPC common stock that may be sold by the Selling Stockholders pursuant to the underwriters' over-allotment option in connection with the Secondary Offering, for a maximum aggregate of 7,187,500 shares of PPC common stock. Except as expressly set forth in this consent letter, the lock-up restrictions under the Lock-Up Agreements shall remain in full force and effect with respect to all shares of PPC common stock and other securities held by each of the Selling Stockholders that are not sold in the Secondary Offering, including, without limitation, any shares subject to the underwriters' over-allotment option that are not ultimately purchased by the underwriters in the Secondary Offering. For the avoidance of doubt, all shares retained by the Selling Stockholders following the consummation of the Secondary Offering shall continue to be subject to the lock-up restrictions under the Lock-Up Agreements until the natural expiration of the Lock-Up Period on October 14, 2023, or such later date as may be applicable pursuant to any new lock-up agreement entered into in connection with the Secondary Offering.

Morningstar Zanthor further notes that the Lock-Up Agreements contain a customary provision requiring that at least 14 calendar days' advance notice be provided to PPC and the relevant lock-up parties prior to the effectiveness of any waiver or release of the lock-up restrictions. Given the de minimis gap between the Waiver Effective Date of October 12, 2023 and the natural expiration of the Lock-Up Period on October 14, 2023 — a period of only two calendar days — and in light of the fact that the Selling Stockholders and the Company have been aware of the proposed Secondary Offering and the timeline for the requested waiver since at least September 18, 2023, Morningstar Zanthor hereby waives the 14-day advance notice requirement set forth in the Lock-Up Agreements with respect to this consent. This waiver of the notice requirement is limited solely to the consent set forth in this letter and shall not be deemed a waiver of the notice requirement with respect to any other waiver or release of lock-up restrictions that may be requested in the future.

The consent set forth in this letter is expressly conditioned upon the satisfaction of each of the following conditions:

(a) Each of the Selling Stockholders shall have entered into new lock-up agreements (the "Secondary Offering Lock-Up Agreements") in connection with the Secondary Offering, in form and substance reasonably satisfactory to the representatives of the underwriters in the Secondary Offering, restricting the sale, transfer, or other disposition of all shares of PPC common stock and related securities retained by each such Selling Stockholder following the consummation of the Secondary Offering for a period of 90 calendar days from the closing date of the Secondary Offering (expected to be October 17, 2023), with such 90-day lock-up period expiring on or about January 15, 2024, and such Secondary Offering Lock-Up Agreements shall be in favor of, and enforceable by, the representatives of the underwriters in the Secondary Offering;

(b) Morningstar Zanthor shall have received written confirmation that each of Ridgeline Securities LLC and Broadmark Capital Inc. has delivered corresponding lock-up waiver consents with respect to the Selling Stockholders, on substantially similar terms and effective as of the same Waiver Effective Date, such that the consent of all three IPO Underwriters shall have been obtained prior to or concurrently with the effectiveness of this consent; and

(c) The Secondary Offering shall be conducted as a registered offering under the Securities Act of 1933, as amended, pursuant to PPC's effective registration statement on Form S-3 (File No. 333-274851), with a prospectus supplement filed in accordance with Rule 424(b)(5), and not as an unregistered or exempt offering.

In the event that any of the foregoing conditions is not satisfied or waived on or prior to the Waiver Effective Date, this consent shall be null and void and of no further force or effect, and the lock-up restrictions under the Lock-Up Agreements shall remain in full force and effect in accordance with their original terms.

This consent is limited solely and exclusively to the specific waiver and early release described herein and shall not be deemed a waiver of, or consent to the release of, any other lock-up restriction under the Lock-Up Agreements or any other agreement to which Morningstar Zanthor is a party or beneficiary. Nothing contained in this consent letter shall be construed as a waiver of any rights, remedies, or claims of Morningstar Zanthor under the Lock-Up Agreements, the IPO underwriting agreement, or any other agreement or instrument, other than as expressly and specifically set forth herein. This consent shall not constitute a precedent for, and shall not entitle any person or entity to, any future waiver, consent, or release of lock-up restrictions under the Lock-Up Agreements or any other agreement, and Morningstar Zanthor expressly reserves all of its rights to grant or withhold consent with respect to any future waiver or release requests in its sole and absolute discretion.

This consent letter shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to the conflicts of law principles thereof that would result in the application of the laws of any other jurisdiction.

This consent letter may be executed in one or more counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of this consent letter by facsimile or by electronic transmission (including by portable document format (PDF) or any other electronic means intended to preserve the original graphic and pictorial appearance of a document) shall be effective as delivery of a manually executed original counterpart hereof.

Very truly yours,

MORNINGSTAR ZANTHOR & CO.

By: ________

Name: Diane Chaudhary

Title: Managing Director

Date: September 29, 2023

Acknowledged and Agreed:

PENTERRA PHARMACEUTICALS CORP.

By: ________

Name: David Orenstein

Title: General Counsel & Corporate Secretary

Date: September 29, 2023

Drafted by Calderwood & Harkness LLP (Audrey Zhou / Brendan Walsh) on behalf of the issuer.

Selling Stockholder	Relationship to PPC	Shares Held	Base Shares Proposed for Sale	Over-Allotment Shares
Dr. Elena Castellano	Co-Founder, Board Chair	14,200,000	3,000,000	Up to 450,000
Dr. Riccardo Castellano	Co-Founder, Board Member	12,800,000	2,500,000	Up to 375,000
Dr. Marco Castellano	Chief Executive Officer	4,500,000	500,000	Up to 75,000
Castellano Family Holdings LLC	Affiliated Entity	8,600,000	250,000	Up to 37,500
Total	40,100,000	6,250,000	Up to 937,500

MORNINGSTAR ZANTHOR & CO. 600 Lexington Avenue New York, NY 10022
September 29, 2023
Penterra Pharmaceuticals Corp. 400 Meridian Parkway, Suite 1200 Princeton, NJ 08540
Attn: David Orenstein, General Counsel & Corporate Secretary
With copies to:
Calderwood & Harkness LLP One Liberty Plaza, 52nd Floor New York, NY 10006
Attn: Jennifer Kwon
Whitfield & Garza LLP 590 Madison Avenue, 28th Floor New York, NY 10022
Attn: Patricia Velázquez
Re: Consent to Early Release of Lock-Up Restrictions — Penterra Pharmaceuticals Corp. Selling-Stockholder Secondary Offering
Dear Mr. Orenstein:
Reference is made to the lock-up agreements (the "Lock-Up Agreements") dated as of April 17, 2023, entered into by certain stockholders, directors, and officers of Penterra Pharmaceuticals Corp., a Delaware corporation ("PPC" or the "Company"), in connection with the Company's initial public offering of shares of its common stock, par value $0.001 per share (the "IPO"), which was priced on April 17, 2023. Morningstar Zanthor & Co. ("Morningstar Zanthor") served as a co-manager of the IPO alongside Ridgeline Securities LLC ("Ridgeline") and Broadmark Capital Inc. ("Broadmark" and, together with Morningstar Zanthor and Ridgeline, the "IPO Underwriters"). The Lock-Up Agreements were entered into with and for the benefit of the IPO Underwriters and, pursuant to their terms, impose restrictions on the sale, transfer, or other disposition of shares of PPC common stock and certain related securities by the signatories thereto for a period of 180 calendar days from April 17, 2023, such lock-up period expiring by its terms on October 14, 2023 (the "Lock-Up Period"). Each of the Lock-Up Agreements provides that the lock-up restrictions contained therein may be waived or released, in whole or in part, prior to the expiration of the Lock-Up Period, with the prior written consent of each of the IPO Underwriters.
Morningstar Zanthor acknowledges receipt of the lock-up waiver request letter from PPC dated September 18, 2023 (the "Request Letter"), requesting that the IPO Underwriters consent to the early release of the lock-up restrictions under the Lock-Up Agreements with respect to the following stockholders of the Company (collectively, the "Selling Stockholders"), in the amounts and on the terms set forth below:
As described in the Request Letter, the Selling Stockholders propose to sell shares of PPC common stock, par value $0.001 per share (Nasdaq: PNTR), in a registered selling-stockholder secondary offering (the "Secondary Offering"). The Secondary Offering is to be effected as a shelf takedown under PPC's existing registration statement on Form S-3 (File No. 333-274851), which was declared effective by the Securities and Exchange Commission on August 22, 2023, with a prospectus supplement to be filed with the Securities and Exchange Commission pursuant to Rule 424(b)(5) under the Securities Act of 1933, as amended. The underwriters for the Secondary Offering will be Ridgeline Securities LLC (lead left book-runner), Broadmark Capital Inc. (joint book-runner), Linden Groves & Co. (co-manager), and Harborview Partners LLC (co-manager). Morningstar Zanthor notes, for the avoidance of doubt, that it is not participating as an underwriter, book-runner, co-manager, or in any other underwriting capacity in connection with the Secondary Offering.
As noted above, the lock-up restrictions under the Lock-Up Agreements expire by their terms on October 14, 2023, which is 180 calendar days from the date of the Lock-Up Agreements. PPC has requested that the lock-up restrictions be released effective as of October 12, 2023 — that is, two calendar days prior to the natural expiration of the Lock-Up Period — in order to permit the pricing and execution of the underwriting agreement for the Secondary Offering (the "Underwriting Agreement") on October 12, 2023, with settlement and closing of the Secondary Offering expected to occur on or about October 17, 2023. Pursuant to the terms of the Lock-Up Agreements, the consent of each of the three IPO Underwriters — Ridgeline Securities LLC, Broadmark Capital Inc., and Morningstar Zanthor & Co. — is required for the early release of the lock-up restrictions applicable to the Selling Stockholders.
Having reviewed the Request Letter and the terms and circumstances of the proposed Secondary Offering, and in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Morningstar Zanthor & Co. hereby consents to the early release of the lock-up restrictions under the Lock-Up Agreements applicable to each of the Selling Stockholders identified above, effective as of October 12, 2023 (the "Waiver Effective Date"). This consent and waiver is granted solely with respect to (i) up to 6,250,000 shares of PPC common stock to be sold by the Selling Stockholders in the base Secondary Offering in the amounts set forth in the table above, plus (ii) up to 937,500 additional shares of PPC common stock that may be sold by the Selling Stockholders pursuant to the underwriters' over-allotment option in connection with the Secondary Offering, for a maximum aggregate of 7,187,500 shares of PPC common stock. Except as expressly set forth in this consent letter, the lock-up restrictions under the Lock-Up Agreements shall remain in full force and effect with respect to all shares of PPC common stock and other securities held by each of the Selling Stockholders that are not sold in the Secondary Offering, including, without limitation, any shares subject to the underwriters' over-allotment option that are not ultimately purchased by the underwriters in the Secondary Offering. For the avoidance of doubt, all shares retained by the Selling Stockholders following the consummation of the Secondary Offering shall continue to be subject to the lock-up restrictions under the Lock-Up Agreements until the natural expiration of the Lock-Up Period on October 14, 2023, or such later date as may be applicable pursuant to any new lock-up agreement entered into in connection with the Secondary Offering.
Morningstar Zanthor further notes that the Lock-Up Agreements contain a customary provision requiring that at least 14 calendar days' advance notice be provided to PPC and the relevant lock-up parties prior to the effectiveness of any waiver or release of the lock-up restrictions. Given the de minimis gap between the Waiver Effective Date of October 12, 2023 and the natural expiration of the Lock-Up Period on October 14, 2023 — a period of only two calendar days — and in light of the fact that the Selling Stockholders and the Company have been aware of the proposed Secondary Offering and the timeline for the requested waiver since at least September 18, 2023, Morningstar Zanthor hereby waives the 14-day advance notice requirement set forth in the Lock-Up Agreements with respect to this consent. This waiver of the notice requirement is limited solely to the consent set forth in this letter and shall not be deemed a waiver of the notice requirement with respect to any other waiver or release of lock-up restrictions that may be requested in the future.
The consent set forth in this letter is expressly conditioned upon the satisfaction of each of the following conditions:
(a) Each of the Selling Stockholders shall have entered into new lock-up agreements (the "Secondary Offering Lock-Up Agreements") in connection with the Secondary Offering, in form and substance reasonably satisfactory to the representatives of the underwriters in the Secondary Offering, restricting the sale, transfer, or other disposition of all shares of PPC common stock and related securities retained by each such Selling Stockholder following the consummation of the Secondary Offering for a period of 90 calendar days from the closing date of the Secondary Offering (expected to be October 17, 2023), with such 90-day lock-up period expiring on or about January 15, 2024, and such Secondary Offering Lock-Up Agreements shall be in favor of, and enforceable by, the representatives of the underwriters in the Secondary Offering;
(b) Morningstar Zanthor shall have received written confirmation that each of Ridgeline Securities LLC and Broadmark Capital Inc. has delivered corresponding lock-up waiver consents with respect to the Selling Stockholders, on substantially similar terms and effective as of the same Waiver Effective Date, such that the consent of all three IPO Underwriters shall have been obtained prior to or concurrently with the effectiveness of this consent; and
(c) The Secondary Offering shall be conducted as a registered offering under the Securities Act of 1933, as amended, pursuant to PPC's effective registration statement on Form S-3 (File No. 333-274851), with a prospectus supplement filed in accordance with Rule 424(b)(5), and not as an unregistered or exempt offering.
In the event that any of the foregoing conditions is not satisfied or waived on or prior to the Waiver Effective Date, this consent shall be null and void and of no further force or effect, and the lock-up restrictions under the Lock-Up Agreements shall remain in full force and effect in accordance with their original terms.
This consent is limited solely and exclusively to the specific waiver and early release described herein and shall not be deemed a waiver of, or consent to the release of, any other lock-up restriction under the Lock-Up Agreements or any other agreement to which Morningstar Zanthor is a party or beneficiary. Nothing contained in this consent letter shall be construed as a waiver of any rights, remedies, or claims of Morningstar Zanthor under the Lock-Up Agreements, the IPO underwriting agreement, or any other agreement or instrument, other than as expressly and specifically set forth herein. This consent shall not constitute a precedent for, and shall not entitle any person or entity to, any future waiver, consent, or release of lock-up restrictions under the Lock-Up Agreements or any other agreement, and Morningstar Zanthor expressly reserves all of its rights to grant or withhold consent with respect to any future waiver or release requests in its sole and absolute discretion.
This consent letter shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to the conflicts of law principles thereof that would result in the application of the laws of any other jurisdiction.
This consent letter may be executed in one or more counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of this consent letter by facsimile or by electronic transmission (including by portable document format (PDF) or any other electronic means intended to preserve the original graphic and pictorial appearance of a document) shall be effective as delivery of a manually executed original counterpart hereof.
Very truly yours,
MORNINGSTAR ZANTHOR & CO.
By: ________
Name: Diane Chaudhary
Title: Managing Director
Date: September 29, 2023
Acknowledged and Agreed:
PENTERRA PHARMACEUTICALS CORP.
By: ________
Name: David Orenstein
Title: General Counsel & Corporate Secretary
Date: September 29, 2023
Drafted by Calderwood & Harkness LLP (Audrey Zhou / Brendan Walsh) on behalf of the issuer.
Selling Stockholder | Relationship to PPC | Shares Held | Base Shares Proposed for Sale | Over-Allotment Shares
Dr. Elena Castellano | Co-Founder, Board Chair | 14,200,000 | 3,000,000 | Up to 450,000
Dr. Riccardo Castellano | Co-Founder, Board Member | 12,800,000 | 2,500,000 | Up to 375,000
Dr. Marco Castellano | Chief Executive Officer | 4,500,000 | 500,000 | Up to 75,000
Castellano Family Holdings LLC | Affiliated Entity | 8,600,000 | 250,000 | Up to 37,500
Total | 40,100,000 | 6,250,000 | Up to 937,500

MORNINGSTAR ZANTHOR & CO. 600 Lexington Avenue New York, NY 10022

MORNINGSTAR ZANTHOR & CO.

PENTERRA PHARMACEUTICALS CORP.

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