1018-00004 · Penterra Pharmaceuticals Corp · Insurance

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CALDERWOOD & HARKNESS LLP

Counselors at Law

280 Park Avenue, 34th Floor New York, NY 10017 Telephone: (212) 554-7000 Facsimile: (212) 554-7001 www.calderwoodharkness.com

101 Carnegie Center, Suite 500 Princeton, NJ 08540 Telephone: (609) 987-3400

July 3, 2023

Via Email and Sundial Data Systems

Allison Whitmore, Esq. Partner Whitmore, Jansen & Callahan LLP 1500 Market Street, Suite 3200 Philadelphia, PA 19102

Re: Master Clinical Trial Agreement dated June 28, 2023, between Penterra Pharmaceuticals Corp. and Veridian Health Research Network, Inc. — Protocol PPC-4871-III (CLARION); Certificate of Insurance Delivery pursuant to Section 9.3 and Exhibit E

Calderwood & Harkness Matter No. 1018-00004

Dear Allison:

We write as outside counsel to Penterra Pharmaceuticals Corp. ("Penterra" or the "Sponsor"), a Delaware corporation headquartered at 200 Biopharma Boulevard, Suite 1400, Princeton, New Jersey 08540, in connection with the above-referenced matter. The purpose of this letter is to transmit the enclosed certificate of insurance in satisfaction of Penterra's obligations under the Master Clinical Trial Agreement (the "MCTA") dated as of June 28, 2023, by and between Penterra and Veridian Health Research Network, Inc. ("Veridian"), relating to the conduct of the Phase III clinical trial designated as Protocol PPC-4871-III, entitled "CLARION" (the "Study").

As you are aware, Section 9.3 of the MCTA, together with Exhibit E thereto (Insurance Requirements), sets forth the insurance obligations of each party as conditions precedent to the closing of the MCTA and the commencement of clinical trial activities. Among these conditions, Section 9.3(a) requires Penterra to deliver to Veridian a certificate of insurance evidencing clinical trial liability coverage meeting the minimum limits and specifications detailed in Exhibit E, such delivery to be made no later than fifteen (15) business days following execution of the MCTA. The MCTA having been executed on June 28, 2023, this transmittal is well within the contractually prescribed timeframe and in advance of the scheduled closing date of July 5, 2023.

We are pleased to confirm that the enclosed certificate of insurance satisfies each of the insurance requirements negotiated by the parties and memorialized in Exhibit E.

Description of Enclosed Certificate of Insurance

Insurer Identification. The coverage described herein is underwritten by Briarcliff Mutual Insurance Company ("Briarcliff Mutual"), a mutual insurance company organized and existing under the laws of the State of Connecticut, with its principal offices located at 55 Constitution Plaza, Hartford, Connecticut 06103. Briarcliff Mutual maintains an A.M. Best rating of "A+ (Superior), XV" and is licensed to write insurance in all fifty states and the District of Columbia. The designated underwriter contact for the Penterra account is Karen Tremblay, Vice President, Life Sciences Lines, who may be reached at (860) 275-4100 or ktremblay@briarcliffmutual.com.

Policy Identification. The policy particulars are as follows:

Policy Number: BM-CTL-2023-04182

Type of Coverage: Clinical Trial Liability Insurance (including Subject-Injury Coverage, Products Liability — Clinical Trial, and Research-Related Professional Liability)

Policy Period: April 1, 2023, through March 31, 2024 (renewable annually, subject to underwriter approval and payment of applicable premium)

Named Insured: Penterra Pharmaceuticals Corp., its subsidiaries, and affiliated entities

Coverage Limits. The coverage limits under Policy No. BM-CTL-2023-04182 are as follows:

We have reviewed these limits against the requirements set forth in Exhibit E, Section 2(a) through 2(d) of the MCTA, and we confirm that each of the foregoing limits meets or exceeds the minimums negotiated and agreed upon by the parties. Specifically, Exhibit E requires a per-occurrence limit of not less than twenty-five million dollars ($25,000,000) and an aggregate limit of not less than seventy-five million dollars ($75,000,000) for clinical trial liability, and a subject-injury sublimit of not less than ten million dollars ($10,000,000) per occurrence and fifty million dollars ($50,000,000) in the aggregate. The enclosed certificate reflects compliance with each of these thresholds.

Confirmation of Additional Insured Status

As reflected on the face of the enclosed certificate and in the accompanying additional insured endorsement (Endorsement No. BM-CTL-2023-04182-AI-001) obtained from Briarcliff Mutual, the following parties have been added as additional insureds under Policy No. BM-CTL-2023-04182, as required by Section 9.3(b) and Exhibit E, Section 3 of the MCTA:

1. Veridian Health Research Network, Inc., a Pennsylvania nonprofit corporation, with its principal offices at 3000 Chestnut Street, Suite 600, Philadelphia, Pennsylvania 19104;

2. Each participating Veridian Network site institution identified on Schedule 1 to the MCTA, which, as of the date of MCTA execution, consists of thirty-eight (38) academic medical centers and affiliated research institutions located across fourteen (14) states, including, without limitation:

(a) Graystone University Medical Center (Site 001), located at 1200 University Avenue, Philadelphia, Pennsylvania 19104; and

(b) Lakemont Medical Center (Site 002), located at 4400 North Michigan Drive, Chicago, Illinois 60611;

3. Each principal investigator, sub-investigator, and site staff member acting within the scope of, and in accordance with, Protocol PPC-4871-III (CLARION), as identified in the delegation of authority logs maintained by each participating site institution and provided to Penterra pursuant to Section 4.2(c) of the MCTA.

Additional insured status under the endorsement is effective as of June 28, 2023, the date of execution of the MCTA, and shall remain in effect for the duration of the policy period, subject to the terms and conditions of the policy. As you may recall, Calderwood & Harkness submitted the formal request for the additional insured endorsement to Briarcliff Mutual on behalf of Penterra on June 29, 2023, and the endorsement was issued on June 30, 2023, with retroactive effect to the date of MCTA execution. A copy of the endorsement, bearing the signature of the underwriter and the effective date, is included among the enclosed materials.

We note that the additional insured endorsement provides coverage to each additional insured solely with respect to liability arising out of or in connection with activities conducted under Protocol PPC-4871-III (CLARION) and does not extend coverage to unrelated activities of Veridian or its network site institutions. This is consistent with the scope of additional insured status contemplated by Exhibit E of the MCTA.

Relationship to MCTA Indemnification Provisions

For the avoidance of doubt, and as expressly provided in Section 9.5 of the MCTA, the insurance coverage described herein is complementary to, and does not limit, modify, supersede, or otherwise affect, Penterra's indemnification obligations under the MCTA, including without limitation those set forth in Section 8 (Indemnification) and Exhibit D (Subject-Injury Indemnification Provisions). As your client is aware, Penterra's indemnification obligations under the MCTA include, among other things:

(a) coverage of reasonable and customary medical costs for the treatment of study-related injuries sustained by enrolled study subjects, subject to a per-subject cap of five hundred thousand dollars ($500,000) and an aggregate cap of fifteen million dollars ($15,000,000) across all participating sites; and

(b) uncapped indemnification for claims arising out of or attributable to product defects, including defects in the manufacture, design, labeling, or formulation of the investigational product (PPC-4871), regardless of whether such claims arise under theories of strict liability, negligence, breach of warranty, or otherwise.

The insurance policy and the indemnification provisions set forth in the MCTA operate independently of one another. The existence of insurance coverage does not relieve Penterra of any indemnification obligation, nor does the availability of indemnification relieve Briarcliff Mutual of any coverage obligation under the policy. In the event of any conflict between the terms of the policy and the terms of the MCTA with respect to the scope of indemnification, the MCTA shall govern as between the parties thereto.

Enclosures

Enclosed herewith, please find the following documents:

Enclosure 1: Certificate of Insurance issued by Briarcliff Mutual Insurance Company for Policy No. BM-CTL-2023-04182, dated June 30, 2023, reflecting the coverage limits, policy period, and named and additional insured designations described above.

Enclosure 2: Additional Insured Endorsement (Endorsement No. BM-CTL-2023-04182-AI-001), naming Veridian Health Research Network, Inc., each participating Veridian Network site institution, and each principal investigator, sub-investigator, and site staff member acting within the scope of Protocol PPC-4871-III (CLARION) as additional insureds, effective as of June 28, 2023.

Please note that the originals of each of the foregoing documents are being sent to your office via Sundial Data Systems for delivery on or before July 5, 2023. Courtesy copies are being transmitted concurrently via email for your immediate review.

Request for Reciprocal Insurance Certificates

We take this opportunity to remind you and your client that, pursuant to Exhibit E, Section 4 of the MCTA, Veridian and each participating site institution are required to provide certificates of insurance evidencing general liability and professional liability coverage of not less than five million dollars ($5,000,000) per occurrence and ten million dollars ($10,000,000) in the aggregate. In accordance with the same fifteen (15) business day delivery period set forth in Section 9.3(a), such certificates should be delivered no later than approximately July 20, 2023.

We request that the required certificates be delivered to our offices at the address set forth above, with a copy to Samantha Novak, Director, Clinical Contracts, Penterra Pharmaceuticals Corp., at 200 Biopharma Boulevard, Suite 1400, Princeton, New Jersey 08540 (email: s.novak@penterra.com). For reference, a separate letter regarding these reciprocal insurance obligations was transmitted on June 30, 2023, to Gregory Callahan, Esq., Vice President, Legal & Compliance at Veridian, and we understand that Mr. Callahan's office is in the process of coordinating the collection of certificates from each of the thirty-eight (38) participating site institutions. We appreciate your assistance in ensuring the timely receipt of these materials.

Annual Renewal Obligation

Finally, Penterra acknowledges its continuing obligation under Section 9.4 of the MCTA to maintain the insurance coverage described herein throughout the entire term of the MCTA, including any extension or renewal periods, and to provide updated certificates of insurance to Veridian promptly upon each annual renewal of the policy. The current policy period under Policy No. BM-CTL-2023-04182 expires on March 31, 2024, and Penterra will provide a renewal certificate to Veridian and to your firm promptly upon the issuance of the renewal policy by Briarcliff Mutual. Veridian and each participating site institution are similarly obligated under Exhibit E, Section 4(c) to provide annual renewal certificates evidencing uninterrupted coverage.

We believe that the delivery of the enclosed certificate of insurance and additional insured endorsement satisfies each of the insurance-related conditions precedent to the closing of the MCTA scheduled for July 5, 2023, as set forth in Section 9.3 and Exhibit E thereof. Should you, David Kesselman, or any other member of your team have any questions regarding the enclosed documents or the matters addressed in this letter, please do not hesitate to contact me at (212) 554-7218 or mcalloway@calderwoodharkness.com, or my colleague Sean Morrissey at (212) 554-7345 or smorrissey@calderwoodharkness.com.

We look forward to the prompt completion of closing on July 5, 2023, and to the successful commencement of the CLARION trial, with the target date for first patient enrollment currently set for August 14, 2023. We appreciate the collaborative and efficient manner in which you and your team have approached the negotiation and execution of this agreement, and we remain available to assist with any further matters that may arise in connection with the Study.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Miriam Calloway Partner, Healthcare & Life Sciences Practice Group Calderwood & Harkness LLP 280 Park Avenue, 34th Floor New York, NY 10017 Direct: (212) 554-7218

Email: mcalloway@calderwoodharkness.com

cc:

Rebecca Liang, Esq., Associate General Counsel, Clinical Affairs, Penterra Pharmaceuticals Corp.

Nathaniel Briggs, Esq., Vice President & General Counsel, Penterra Pharmaceuticals Corp.

Samantha Novak, Director, Clinical Contracts, Penterra Pharmaceuticals Corp.

Jennifer Holt, Vice President, Clinical Operations, Penterra Pharmaceuticals Corp.

Sean Morrissey, Associate, Calderwood & Harkness LLP

Christopher Aiken, Associate, Calderwood & Harkness LLP

Gregory Callahan, Esq., Vice President, Legal & Compliance, Veridian Health Research Network, Inc.

David Kesselman, Associate, Whitmore, Jansen & Callahan LLP

Enclosures (2)

Coverage Category	Per-Occurrence Limit	Aggregate Limit
Clinical Trial Liability (Combined Single Limit)	$25,000,000	$75,000,000
Subject-Injury Sublimit	$10,000,000	$50,000,000

CALDERWOOD & HARKNESS LLP
Counselors at Law
280 Park Avenue, 34th Floor New York, NY 10017 Telephone: (212) 554-7000 Facsimile: (212) 554-7001 www.calderwoodharkness.com
101 Carnegie Center, Suite 500 Princeton, NJ 08540 Telephone: (609) 987-3400
July 3, 2023
Via Email and Sundial Data Systems
Allison Whitmore, Esq. Partner Whitmore, Jansen & Callahan LLP 1500 Market Street, Suite 3200 Philadelphia, PA 19102
Re: Master Clinical Trial Agreement dated June 28, 2023, between Penterra Pharmaceuticals Corp. and Veridian Health Research Network, Inc. — Protocol PPC-4871-III (CLARION); Certificate of Insurance Delivery pursuant to Section 9.3 and Exhibit E
Calderwood & Harkness Matter No. 1018-00004
Dear Allison:
We write as outside counsel to Penterra Pharmaceuticals Corp. ("Penterra" or the "Sponsor"), a Delaware corporation headquartered at 200 Biopharma Boulevard, Suite 1400, Princeton, New Jersey 08540, in connection with the above-referenced matter. The purpose of this letter is to transmit the enclosed certificate of insurance in satisfaction of Penterra's obligations under the Master Clinical Trial Agreement (the "MCTA") dated as of June 28, 2023, by and between Penterra and Veridian Health Research Network, Inc. ("Veridian"), relating to the conduct of the Phase III clinical trial designated as Protocol PPC-4871-III, entitled "CLARION" (the "Study").
As you are aware, Section 9.3 of the MCTA, together with Exhibit E thereto (Insurance Requirements), sets forth the insurance obligations of each party as conditions precedent to the closing of the MCTA and the commencement of clinical trial activities. Among these conditions, Section 9.3(a) requires Penterra to deliver to Veridian a certificate of insurance evidencing clinical trial liability coverage meeting the minimum limits and specifications detailed in Exhibit E, such delivery to be made no later than fifteen (15) business days following execution of the MCTA. The MCTA having been executed on June 28, 2023, this transmittal is well within the contractually prescribed timeframe and in advance of the scheduled closing date of July 5, 2023.
We are pleased to confirm that the enclosed certificate of insurance satisfies each of the insurance requirements negotiated by the parties and memorialized in Exhibit E.
Description of Enclosed Certificate of Insurance
Insurer Identification.  The coverage described herein is underwritten by Briarcliff Mutual Insurance Company ("Briarcliff Mutual"), a mutual insurance company organized and existing under the laws of the State of Connecticut, with its principal offices located at 55 Constitution Plaza, Hartford, Connecticut 06103. Briarcliff Mutual maintains an A.M. Best rating of "A+ (Superior), XV" and is licensed to write insurance in all fifty states and the District of Columbia. The designated underwriter contact for the Penterra account is Karen Tremblay, Vice President, Life Sciences Lines, who may be reached at (860) 275-4100 or ktremblay@briarcliffmutual.com.
Policy Identification.  The policy particulars are as follows:
Policy Number: BM-CTL-2023-04182
Type of Coverage: Clinical Trial Liability Insurance (including Subject-Injury Coverage, Products Liability — Clinical Trial, and Research-Related Professional Liability)
Policy Period: April 1, 2023, through March 31, 2024 (renewable annually, subject to underwriter approval and payment of applicable premium)
Named Insured: Penterra Pharmaceuticals Corp., its subsidiaries, and affiliated entities
Coverage Limits.  The coverage limits under Policy No. BM-CTL-2023-04182 are as follows:
We have reviewed these limits against the requirements set forth in Exhibit E, Section 2(a) through 2(d) of the MCTA, and we confirm that each of the foregoing limits meets or exceeds the minimums negotiated and agreed upon by the parties. Specifically, Exhibit E requires a per-occurrence limit of not less than twenty-five million dollars ($25,000,000) and an aggregate limit of not less than seventy-five million dollars ($75,000,000) for clinical trial liability, and a subject-injury sublimit of not less than ten million dollars ($10,000,000) per occurrence and fifty million dollars ($50,000,000) in the aggregate. The enclosed certificate reflects compliance with each of these thresholds.
Confirmation of Additional Insured Status
As reflected on the face of the enclosed certificate and in the accompanying additional insured endorsement (Endorsement No. BM-CTL-2023-04182-AI-001) obtained from Briarcliff Mutual, the following parties have been added as additional insureds under Policy No. BM-CTL-2023-04182, as required by Section 9.3(b) and Exhibit E, Section 3 of the MCTA:
1.  Veridian Health Research Network, Inc., a Pennsylvania nonprofit corporation, with its principal offices at 3000 Chestnut Street, Suite 600, Philadelphia, Pennsylvania 19104;
2.  Each participating Veridian Network site institution identified on Schedule 1 to the MCTA, which, as of the date of MCTA execution, consists of thirty-eight (38) academic medical centers and affiliated research institutions located across fourteen (14) states, including, without limitation:
(a) Graystone University Medical Center (Site 001), located at 1200 University Avenue, Philadelphia, Pennsylvania 19104; and
(b) Lakemont Medical Center (Site 002), located at 4400 North Michigan Drive, Chicago, Illinois 60611;
3.  Each principal investigator, sub-investigator, and site staff member acting within the scope of, and in accordance with, Protocol PPC-4871-III (CLARION), as identified in the delegation of authority logs maintained by each participating site institution and provided to Penterra pursuant to Section 4.2(c) of the MCTA.
Additional insured status under the endorsement is effective as of June 28, 2023, the date of execution of the MCTA, and shall remain in effect for the duration of the policy period, subject to the terms and conditions of the policy. As you may recall, Calderwood & Harkness submitted the formal request for the additional insured endorsement to Briarcliff Mutual on behalf of Penterra on June 29, 2023, and the endorsement was issued on June 30, 2023, with retroactive effect to the date of MCTA execution. A copy of the endorsement, bearing the signature of the underwriter and the effective date, is included among the enclosed materials.
We note that the additional insured endorsement provides coverage to each additional insured solely with respect to liability arising out of or in connection with activities conducted under Protocol PPC-4871-III (CLARION) and does not extend coverage to unrelated activities of Veridian or its network site institutions. This is consistent with the scope of additional insured status contemplated by Exhibit E of the MCTA.
Relationship to MCTA Indemnification Provisions
For the avoidance of doubt, and as expressly provided in Section 9.5 of the MCTA, the insurance coverage described herein is complementary to, and does not limit, modify, supersede, or otherwise affect, Penterra's indemnification obligations under the MCTA, including without limitation those set forth in Section 8 (Indemnification) and Exhibit D (Subject-Injury Indemnification Provisions). As your client is aware, Penterra's indemnification obligations under the MCTA include, among other things:
(a) coverage of reasonable and customary medical costs for the treatment of study-related injuries sustained by enrolled study subjects, subject to a per-subject cap of five hundred thousand dollars ($500,000) and an aggregate cap of fifteen million dollars ($15,000,000) across all participating sites; and
(b) uncapped indemnification for claims arising out of or attributable to product defects, including defects in the manufacture, design, labeling, or formulation of the investigational product (PPC-4871), regardless of whether such claims arise under theories of strict liability, negligence, breach of warranty, or otherwise.
The insurance policy and the indemnification provisions set forth in the MCTA operate independently of one another. The existence of insurance coverage does not relieve Penterra of any indemnification obligation, nor does the availability of indemnification relieve Briarcliff Mutual of any coverage obligation under the policy. In the event of any conflict between the terms of the policy and the terms of the MCTA with respect to the scope of indemnification, the MCTA shall govern as between the parties thereto.
Enclosures
Enclosed herewith, please find the following documents:
Enclosure 1: Certificate of Insurance issued by Briarcliff Mutual Insurance Company for Policy No. BM-CTL-2023-04182, dated June 30, 2023, reflecting the coverage limits, policy period, and named and additional insured designations described above.
Enclosure 2: Additional Insured Endorsement (Endorsement No. BM-CTL-2023-04182-AI-001), naming Veridian Health Research Network, Inc., each participating Veridian Network site institution, and each principal investigator, sub-investigator, and site staff member acting within the scope of Protocol PPC-4871-III (CLARION) as additional insureds, effective as of June 28, 2023.
Please note that the originals of each of the foregoing documents are being sent to your office via Sundial Data Systems for delivery on or before July 5, 2023. Courtesy copies are being transmitted concurrently via email for your immediate review.
Request for Reciprocal Insurance Certificates
We take this opportunity to remind you and your client that, pursuant to Exhibit E, Section 4 of the MCTA, Veridian and each participating site institution are required to provide certificates of insurance evidencing general liability and professional liability coverage of not less than five million dollars ($5,000,000) per occurrence and ten million dollars ($10,000,000) in the aggregate. In accordance with the same fifteen (15) business day delivery period set forth in Section 9.3(a), such certificates should be delivered no later than approximately July 20, 2023.
We request that the required certificates be delivered to our offices at the address set forth above, with a copy to Samantha Novak, Director, Clinical Contracts, Penterra Pharmaceuticals Corp., at 200 Biopharma Boulevard, Suite 1400, Princeton, New Jersey 08540 (email: s.novak@penterra.com). For reference, a separate letter regarding these reciprocal insurance obligations was transmitted on June 30, 2023, to Gregory Callahan, Esq., Vice President, Legal & Compliance at Veridian, and we understand that Mr. Callahan's office is in the process of coordinating the collection of certificates from each of the thirty-eight (38) participating site institutions. We appreciate your assistance in ensuring the timely receipt of these materials.
Annual Renewal Obligation
Finally, Penterra acknowledges its continuing obligation under Section 9.4 of the MCTA to maintain the insurance coverage described herein throughout the entire term of the MCTA, including any extension or renewal periods, and to provide updated certificates of insurance to Veridian promptly upon each annual renewal of the policy. The current policy period under Policy No. BM-CTL-2023-04182 expires on March 31, 2024, and Penterra will provide a renewal certificate to Veridian and to your firm promptly upon the issuance of the renewal policy by Briarcliff Mutual. Veridian and each participating site institution are similarly obligated under Exhibit E, Section 4(c) to provide annual renewal certificates evidencing uninterrupted coverage.
We believe that the delivery of the enclosed certificate of insurance and additional insured endorsement satisfies each of the insurance-related conditions precedent to the closing of the MCTA scheduled for July 5, 2023, as set forth in Section 9.3 and Exhibit E thereof. Should you, David Kesselman, or any other member of your team have any questions regarding the enclosed documents or the matters addressed in this letter, please do not hesitate to contact me at (212) 554-7218 or mcalloway@calderwoodharkness.com, or my colleague Sean Morrissey at (212) 554-7345 or smorrissey@calderwoodharkness.com.
We look forward to the prompt completion of closing on July 5, 2023, and to the successful commencement of the CLARION trial, with the target date for first patient enrollment currently set for August 14, 2023. We appreciate the collaborative and efficient manner in which you and your team have approached the negotiation and execution of this agreement, and we remain available to assist with any further matters that may arise in connection with the Study.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Miriam Calloway Partner, Healthcare & Life Sciences Practice Group Calderwood & Harkness LLP 280 Park Avenue, 34th Floor New York, NY 10017 Direct: (212) 554-7218
Email: mcalloway@calderwoodharkness.com
cc:
Rebecca Liang, Esq., Associate General Counsel, Clinical Affairs, Penterra Pharmaceuticals Corp.
Nathaniel Briggs, Esq., Vice President & General Counsel, Penterra Pharmaceuticals Corp.
Samantha Novak, Director, Clinical Contracts, Penterra Pharmaceuticals Corp.
Jennifer Holt, Vice President, Clinical Operations, Penterra Pharmaceuticals Corp.
Sean Morrissey, Associate, Calderwood & Harkness LLP
Christopher Aiken, Associate, Calderwood & Harkness LLP
Gregory Callahan, Esq., Vice President, Legal & Compliance, Veridian Health Research Network, Inc.
David Kesselman, Associate, Whitmore, Jansen & Callahan LLP
Enclosures (2)
Coverage Category | Per-Occurrence Limit | Aggregate Limit
Clinical Trial Liability (Combined Single Limit) | $25,000,000 | $75,000,000
Subject-Injury Sublimit | $10,000,000 | $50,000,000

CALDERWOOD & HARKNESS LLP

CALDERWOOD & HARKNESS LLP

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