1018-00008 · Penterra Pharmaceuticals Corp · Post-Termination & Litigation Prep

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IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

VERIFIED COUNTERCLAIM OF PENTERRA PHARMACEUTICALS CORP. FOR DECLARATORY JUDGMENT

Penterra Pharmaceuticals Corp. ("Penterra" or "Counterclaim Plaintiff"), by and through its undersigned attorneys, Calderwood & Harkness LLP, brings this Verified Counterclaim for Declaratory Judgment against Veridian Biosciences, Inc. ("Veridian" or "Counterclaim Defendant") and respectfully alleges as follows.

INTRODUCTION

1. This case arises from the catastrophic failure of a clinical-stage drug candidate and the rights of a would-be acquirer to walk away from a $900 million acquisition when the very asset it agreed to purchase has been fundamentally destroyed.

2. On June 10, 2024, Penterra entered into a Stock Purchase Agreement (the "SPA" or the "Agreement") to acquire one hundred percent (100%) of the outstanding capital stock of Veridian for $900,000,000 in cash (the "Transaction"). A true and correct copy of the SPA is attached hereto as Exhibit A and incorporated herein by reference.

3. Penterra entered into the SPA based on the commercial promise of Veridian's lead drug candidate, VRD-4187, a bispecific T-cell engager targeting DLL3-expressing tumors for the treatment of small cell lung cancer ("SCLC"). VRD-4187 was the centerpiece of Veridian's pipeline, the principal driver of the $900 million purchase price, and the foundation upon which Penterra's strategic rationale for the acquisition rested.

4. Following the execution of the SPA, VRD-4187 suffered catastrophic clinical trial results. On August 14, 2024, the independent Data Monitoring Committee ("DMC") for the Phase II Marlowe Asset Management-2 clinical trial conducted a pre-specified interim analysis. The results were devastating: VRD-4187 demonstrated a statistically significant increase in serious adverse events, including Grade 3 or higher cytokine release syndrome ("CRS") in 23.4% of patients in the VRD-4187 treatment arm (compared to 4.1% in the control arm) — a nearly six-fold increase. Seven patients in the VRD-4187 arm died from treatment-related causes, compared to one patient in the control arm — a seven-fold increase in the mortality rate. At the same time, VRD-4187 showed no meaningful efficacy advantage over the standard of care, with an overall response rate ("ORR") of 31.4% versus 28.9% for the control arm, a difference that was not statistically significant (p = 0.58).

5. On August 22, 2024, the United States Food and Drug Administration (the "FDA") imposed a partial clinical hold on VRD-4187 (IND 154832), one of the most severe regulatory actions the agency can take with respect to an investigational drug, pending investigation of the CRS-related deaths. The clinical hold prohibited new enrollment in the Marlowe Asset Management-2 trial and required Veridian to submit a complete response before the trial could resume.

6. These developments constituted a material adverse effect on Veridian's business, results of operations, financial condition, and assets, taken as a whole, within the meaning of Section 1.1 of the SPA. Veridian is a clinical-stage company with zero product revenue, a FY2023 net loss of $87.3 million, and an enterprise value derived entirely from the clinical promise of its pipeline — principally VRD-4187. The destruction of VRD-4187's clinical viability fundamentally and durably impaired the value of Veridian as an ongoing enterprise.

7. Penterra lawfully terminated the SPA on September 30, 2024, pursuant to Section 8.1(d), on the grounds that the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024, due to the occurrence and continuation of a material adverse effect. A true and correct copy of the Termination Notice is attached hereto as Exhibit D and incorporated herein by reference.

8. Penterra now seeks a declaratory judgment from this Court confirming the validity of that termination and declaring that Penterra has no further obligations to Veridian or the Sellers under the SPA, including no obligation to pay the $45,000,000 reverse termination fee, no obligation to consummate the Transaction, and no obligation to pay the $900 million purchase price.

NATURE OF THE ACTION

9. This is a counterclaim for declaratory relief pursuant to 10 Del. C. § 6501 et seq. (the Delaware Declaratory Judgment Act) and Court of Chancery Rule 57.

10. Penterra seeks a declaration from this Court that:

(a) a material adverse effect occurred with respect to the business, results of operations, financial condition, and assets of Veridian Biosciences, Inc., taken as a whole, within the meaning of Section 1.1 of the SPA;

(b) the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) of the SPA were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024;

(d) Penterra has no further obligations to Veridian or any of the Sellers under the SPA, including no obligation to pay the $45,000,000 reverse termination fee.

11. An actual controversy exists between the parties regarding the validity of the termination. Veridian has filed a complaint in this action alleging that Penterra breached its obligations under the SPA by terminating the Agreement and seeking, among other remedies, specific performance compelling Penterra to close the Transaction. Penterra denies those allegations and affirmatively contends that its termination was proper and that it owes no further obligations to Veridian or any of the Sellers.

12. A judicial declaration resolving this controversy is necessary and appropriate to settle the rights and legal relations of the parties and to afford relief from the uncertainty and controversy giving rise to this proceeding.

THE PARTIES

A. Counterclaim Plaintiff

13. Penterra Pharmaceuticals Corp. ("Penterra") is a corporation duly organized and existing under the laws of the State of Delaware, with its principal executive office located at 1100 Meridian Boulevard, Suite 400, Princeton, New Jersey 08540.

14. Penterra is publicly traded on the Nasdaq Stock Market under the ticker symbol "PPCA." As of June 2024, Penterra had a market capitalization of approximately $14.2 billion.

15. Penterra's registered agent for service of process in the State of Delaware is Capitol Corporate Services, Inc., located at 1675 South Ashbury Asset Advisors, Suite B, Dover, Delaware 19901.

16. Penterra is a mid-cap specialty pharmaceutical company with a diversified commercial portfolio of twelve (12) marketed products across the oncology, immunology, and rare disease therapeutic areas. For the fiscal year ended December 31, 2023, Penterra reported consolidated revenue of approximately $4.87 billion and net income of approximately $612 million.

17. Penterra's Chief Executive Officer is Dr. Anand Rajagopal. Penterra's General Counsel and Secretary is Thomas F. Holbrook.

B. Counterclaim Defendant

18. Veridian Biosciences, Inc. ("Veridian") is a corporation duly organized and existing under the laws of the State of Delaware, with its principal office located at 550 Gateway Drive, Cambridge, Massachusetts 02142.

19. Veridian is a privately held, clinical-stage biotechnology company focused on the development of immuno-oncology therapeutics. Veridian was founded in 2016 by Dr. Julian Marek, who serves as its Chief Executive Officer, and Dr. Priya Chandrasekaran, who serves as its Chief Scientific Officer.

20. Veridian's registered agent for service of process in the State of Delaware is Tidewater Registered Agents LLC, located at 838 Walker Road, Suite 21-2, Dover, Delaware 19904.

21. At the time of the SPA's execution, Veridian had approximately 148 employees. Veridian has no product revenue. For the fiscal year ended December 31, 2023, Veridian reported total revenue of $0 and a net loss of approximately $87.3 million. Veridian has funded its operations through private equity financing, having raised approximately $420 million across Series A through Series D funding rounds.

22. Veridian's major stockholders include Crestline Ventures, LP (approximately 28.3% of outstanding stock), Boreal Health Partners Fund III, LP (approximately 19.7% of outstanding stock), and Apex Growth Equity Fund II, LP (approximately 14.1% of outstanding stock). Together, these three stockholders hold approximately 62.1% of Veridian's outstanding capital stock.

C. Non-Party Stockholder Representative

23. David Ng, Managing Partner of Crestline Ventures, LP, serves as the Stockholder Representative under the SPA on behalf of the Sellers (as defined in the SPA). Although Mr. Ng is not a party to this counterclaim, his role as Stockholder Representative is relevant to the facts and circumstances alleged herein.

JURISDICTION AND VENUE

24. This Court has subject matter jurisdiction over this counterclaim pursuant to 10 Del. C. § 341, which vests the Court of Chancery with general equity jurisdiction, and pursuant to 6 Del. C. § 18-111.

25. This Court has jurisdiction over this counterclaim pursuant to Section 10.6 of the SPA, which provides, in relevant part, that the parties irrevocably submit to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, the Superior Court of the State of Delaware or the United States District Court for the District of Delaware) for the purpose of any action, suit, or proceeding arising out of or relating to the SPA or the transactions contemplated thereby.

26. Venue is proper in New Castle County, Delaware. Both Penterra and Veridian are corporations organized under the laws of the State of Delaware, and both parties have consented to the exclusive jurisdiction and venue of this Court under Section 10.6 of the SPA.

27. The SPA is governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice-of-law or conflict-of-law provisions, as set forth in Section 10.6 of the SPA.

28. Pursuant to Section 10.6 of the SPA, each of the parties irrevocably waived any objection that it may now or hereafter have to the laying of venue of any action, suit, or proceeding arising out of or relating to the SPA in this Court, and irrevocably waived and agreed not to plead or claim that any such action, suit, or proceeding brought in this Court has been brought in an inconvenient forum.

FACTUAL BACKGROUND

A. The Parties and Their Businesses

29. Penterra is a mid-cap specialty pharmaceutical company with a diversified commercial portfolio of twelve (12) marketed products across the oncology, immunology, and rare disease therapeutic areas. Penterra is listed on the Nasdaq Stock Market under the ticker symbol "PPCA" and had a market capitalization of approximately $14.2 billion as of June 2024. For the fiscal year ended December 31, 2023, Penterra reported consolidated revenue of approximately $4.87 billion.

30. In November 2023, Penterra experienced a significant setback to its internal oncology pipeline. On November 18, 2023, a pre-planned futility analysis of Penterra's Phase III clinical trial of PPC-0921, an anti-PD-L1/TIM-3 bispecific antibody, failed to demonstrate a statistically significant improvement in progression-free survival compared to the control arm. The Penterra Board of Directors and management team recognized that this setback created a strategic need to bolster Penterra's immuno-oncology pipeline through external acquisition.

31. Veridian is a clinical-stage biotechnology company founded in 2016 by Dr. Julian Marek and Dr. Priya Chandrasekaran. Veridian has developed a proprietary technology platform known as VeriTCE (Veridian T-Cell Engager), which enables the engineering of bispecific T-cell engager molecules designed to redirect the patient's own T-cells to attack cancer cells expressing specific target antigens.

32. At the time of the SPA's execution, Veridian had three immuno-oncology candidates leveraging the VeriTCE platform in various stages of clinical and preclinical development. Veridian has never generated product revenue. For the fiscal year ended December 31, 2023, Veridian reported total revenue of $0 and a net loss of approximately $87.3 million. Veridian had approximately $112.4 million in cash and cash equivalents as of March 31, 2024. Since its founding, Veridian has raised approximately $420 million across its Series A through Series D financing rounds.

33. Veridian's lead and most advanced clinical candidate was VRD-4187, a bispecific T-cell engager targeting DLL3-expressing tumors, principally for the treatment of small cell lung cancer ("SCLC"). VRD-4187 was Veridian's flagship product, the most advanced candidate in its pipeline, and the primary asset underpinning Veridian's enterprise value.

34. At the time of the SPA's execution, VRD-4187 was in Phase II clinical trials. The pivotal trial, known as Marlowe Asset Management-2 (ClinicalTrials.gov Identifier NCT05837291), was a randomized, open-label study designed to evaluate the safety and efficacy of VRD-4187 in combination with standard chemotherapy compared to standard chemotherapy alone in patients with previously treated SCLC. The Marlowe Asset Management-2 trial was being conducted across 42 clinical sites in the United States and European Union, with 387 enrolled patients (194 in the VRD-4187 treatment arm and 193 in the control arm).

B. The Stock Purchase Agreement

35. On February 12, 2024, the Penterra Board of Directors held a special meeting at which management presented a strategic assessment of potential acquisition targets in the immuno-oncology space. Following discussion and deliberation, the Board authorized Dr. Rajagopal and the management team to explore an acquisition of Veridian, subject to Board approval of any definitive agreement.

36. On March 1, 2024, Penterra submitted a non-binding indication of interest to Veridian and its financial advisor, Ridgeway Partners LLC, expressing Penterra's interest in acquiring all of the outstanding capital stock of Veridian at an indicative enterprise value of $850 million to $950 million, subject to satisfactory completion of due diligence and negotiation and execution of a definitive agreement.

37. On March 4, 2024, Penterra and Veridian executed a mutual Confidentiality Agreement governing the exchange of non-public information in connection with the potential transaction.

38. Commencing on March 11, 2024, Penterra conducted extensive due diligence on Veridian's business, operations, financial condition, intellectual property, regulatory affairs, and clinical programs. As part of this process, Penterra retained Broadleaf Scientific Consulting LLC, led by Dr. Raymond Kapoor, to conduct a clinical due diligence review of Veridian's pipeline, with particular emphasis on the VRD-4187 program and the Marlowe Asset Management-2 trial. Penterra also engaged Garrison Zanthor & Co., LLC as its financial advisor, with Kevin Driscoll, Managing Director, as the lead advisor on the transaction.

39. The due diligence process extended over approximately three months. During this period, Penterra's advisors reviewed clinical data, regulatory filings, manufacturing agreements, intellectual property portfolios, employment matters, and financial projections provided by Veridian and its advisors. The clinical due diligence conducted by Broadleaf Scientific Consulting was based on the data available as of that time, which did not include the results of the interim analysis subsequently performed by the DMC on August 14, 2024.

40. On June 9, 2024, Garrison Zanthor & Co., LLC delivered a fairness opinion to Penterra's Board of Directors, opining that, as of that date and based upon and subject to the assumptions, qualifications, and limitations set forth therein, the $900 million purchase price to be paid by Penterra pursuant to the SPA was fair, from a financial point of view, to Penterra.

41. The SPA was fully negotiated, executed, and delivered on June 10, 2024. Dr. Anand Rajagopal executed the SPA on behalf of Penterra, Dr. Julian Marek executed the SPA on behalf of Veridian, and David Ng executed the SPA in his capacity as Stockholder Representative on behalf of the Sellers.

42. The SPA contains the following key terms, among others:

(a) Purchase Price. Penterra agreed to pay $900,000,000 in cash (the "Purchase Price") in exchange for one hundred percent (100%) of the outstanding capital stock of Veridian. (SPA § 2.1.) The SPA did not provide for any purchase price adjustment based on the cash on Veridian's balance sheet at closing.

(b) Escrow Arrangements. At closing, $180,000,000 (representing 20% of the Purchase Price) was to be deposited into an indemnification escrow account, and $2,500,000 was to be deposited into a stockholder representative expense fund, in each case with Fidelis National Escrow Corp. as escrow agent. (SPA § 2.3.) The net closing payment to the Sellers was therefore $717,500,000 ($900,000,000 minus $180,000,000 minus $2,500,000).

(c) Indemnification. The general indemnification cap was set at $180,000,000 (20% of the Purchase Price). The cap for breaches of fundamental representations (including representations regarding organization, authority, capitalization, and title to shares) was set at $900,000,000 (100% of the Purchase Price). A tipping basket of $9,000,000 (1% of the Purchase Price) applied to general indemnification claims, meaning that no indemnification was payable unless aggregate losses exceeded $9,000,000, at which point the Sellers would be liable for the full amount of losses from the first dollar. General representations survived for 18 months following the closing; fundamental representations survived for the full statute of limitations applicable to such representations plus 60 days. (SPA §§ 9.1–9.4.)

(d) No-Shop Provision. Veridian and the Sellers agreed to a customary no-shop provision prohibiting them from soliciting, encouraging, or engaging in discussions or negotiations with respect to any alternative acquisition proposal. The no-shop provision included a limited fiduciary out permitting the Veridian Board to respond to an unsolicited superior proposal, subject to four (4) business days' matching rights in favor of Penterra. (SPA § 5.4.)

(e) Reverse Termination Fee. A reverse termination fee of $45,000,000 (5% of the Purchase Price) was payable by Penterra to the Sellers, triggered solely and exclusively by Penterra's failure to consummate the closing due to a failure to obtain committed financing. (SPA § 8.3(b).)

(f) Target Termination Fee. A target termination fee of $36,000,000 (4% of the Purchase Price) was payable by Veridian to Penterra, triggered by the Sellers' breach of the no-shop provision. (SPA § 8.3(a).)

(g) Outside Date. The SPA provided for an Outside Date of December 10, 2024, which was 180 days following the date of execution. (SPA § 8.1(b).)

(h) Governing Law and Exclusive Jurisdiction. The SPA is governed by the laws of the State of Delaware, and the parties agreed to the exclusive jurisdiction of the Court of Chancery of the State of Delaware for all disputes arising out of or relating to the SPA. (SPA § 10.6.)

(i) Specific Performance. Section 10.12 of the SPA grants the Sellers the right to seek specific performance to compel Penterra to consummate the closing, but only if all conditions to Penterra's obligation to close under Article VII have been satisfied or waived.

C. The Material Adverse Effect Definition

43. The term "Material Adverse Effect" (or "MAE") is defined in Section 1.1 of the SPA. The MAE definition is central to this counterclaim and is quoted in relevant part below:

"'Material Adverse Effect' means any event, change, development, occurrence, condition or effect that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on (a) the business, results of operations, financial condition or assets of the Company, taken as a whole, or (b) the ability of the Sellers to consummate the Transactions."

44. The MAE definition includes certain carveouts, which exclude from the definition of Material Adverse Effect changes arising from or relating to:

(i) general economic or political conditions;

(ii) conditions affecting the biotechnology or pharmaceutical industries generally;

(iii) changes in applicable law or United States generally accepted accounting principles ("GAAP");

(iv) pandemics, including COVID-19 and any similar public health emergencies;

(v) natural disasters, acts of war, or terrorism;

(vi) changes in financial markets generally; and

(vii) the announcement or pendency of the Transactions contemplated by the SPA.

45. Carveouts (i) through (vi) are subject to a "disproportionate impact" exception. Specifically, the SPA provides that the foregoing carveouts shall not apply to the extent that the relevant event, change, development, occurrence, condition, or effect disproportionately affects the Company (Veridian) relative to other comparably situated companies operating in the biotechnology industry. The disproportionate-impact exception is significant because it restores to the MAE analysis any general or industry-wide condition that has a disproportionate impact on Veridian specifically.

46. Critically, the MAE carveouts enumerated in the SPA do not include any carveout for (a) company-specific clinical trial results, (b) regulatory actions directed at the Company's products, or (c) adverse changes to the Company's product pipeline. The absence of such carveouts is significant and reflects the parties' deliberate allocation of the risk of clinical trial failure and adverse regulatory action to the Sellers and the Company, rather than to the Buyer.

D. The Buyer's Closing Conditions

47. Article VII of the SPA sets forth the conditions to each party's obligation to consummate the Transaction. Section 7.2 specifies the conditions to Penterra's obligation to close, including, among others:

(a) Bring-Down of Representations and Warranties (§ 7.2(a)). The representations and warranties of the Sellers set forth in the SPA must be true and correct in all respects (except where qualified by materiality or material adverse effect, in which case such representations and warranties must be true and correct in all material respects) as of the Closing Date as though made on and as of such date (except to the extent that such representations and warranties expressly relate to an earlier date, in which case they must be true and correct as of such earlier date).

(b) No Material Adverse Effect (§ 7.2(b)). No Material Adverse Effect shall have occurred since the date of the Agreement (June 10, 2024) and be continuing as of the Closing Date.

48. Section 7.2 also conditions closing on compliance by the Company and the Sellers with their respective covenants and agreements, delivery of officer's certificates confirming satisfaction of conditions, delivery of customary closing deliverables, and certain other conditions. These conditions are not at issue in this counterclaim.

E. Regulatory Approvals Obtained

49. On April 22, 2024, Penterra filed the required pre-merger notification under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), with the Federal Trade Commission (the "FTC") and the Antitrust Division of the United States Department of Justice. The HSR Act filing fee was $280,500.

50. On May 20, 2024, the FTC granted early termination of the waiting period under the HSR Act, and the antitrust condition to closing was fully satisfied. No second request for additional information or documentary material was issued by either the FTC or the Antitrust Division.

51. On June 14, 2024, Veridian obtained the required stockholder approval of the Transaction through execution of a written consent by stockholders holding more than ninety percent (90%) of Veridian's outstanding capital stock, in accordance with Section 228 of the Delaware General Corporation Law and Section 5.2 of the SPA.

52. As of the date of this Verified Counterclaim, all regulatory approvals necessary for the consummation of the Transaction had been obtained. The failure of the Transaction was not attributable to any regulatory impediment.

F. Financing Arrangements

53. At all relevant times, Penterra had ample financial resources to consummate the Transaction. As of the end of the second fiscal quarter of 2024, Penterra had approximately $2.1 billion in unrestricted cash and cash equivalents on its balance sheet.

54. On June 7, 2024, Penterra entered into a committed term loan facility in the amount of $500,000,000 (the "Commitment Letter," Ref. CL-2024-PPCA-0607), with Summit Ridge Capital Partners, LP as lead arranger and Ironclad Trust Company, N.A. as administrative agent. The term loan bore interest at SOFR plus 225 basis points, with a commitment fee of 0.35% per annum and a ticking fee of 0.175% per annum commencing September 8, 2024. The financing commitment was co-terminous with the SPA Outside Date of December 10, 2024.

55. Penterra's intended funding plan for the Transaction was to draw $500 million from the committed term loan facility and to fund the remaining $400 million from Penterra's existing cash on hand.

56. At no point during the period between the execution of the SPA and Penterra's termination of the SPA did Penterra's financing fail, become unavailable, or become subject to any condition that was not capable of being satisfied. Penterra had the financial ability to close the Transaction at all times. The termination of the SPA was not caused by or related to any financing failure, and the reverse termination fee provision of Section 8.3(b) was never triggered.

G. The Representation and Warranty Insurance Policy

57. On June 12, 2024, in connection with the Transaction, Penterra caused to be bound a buyer-side representation and warranty insurance policy (the "R&W Policy") issued by Atlas Indemnity Insurance Co. (Policy No. AIC-RWI-2024-07892). The R&W Policy was brokered by Prescott Whitfield Insurance Brokers, Inc.

58. The R&W Policy had a policy limit of $180,000,000, matching the general indemnification cap under the SPA, and a self-insured retention of $9,000,000, matching the indemnification tipping basket. The total premium for the R&W Policy was $3,960,000, plus an underwriting fee of $75,000.

59. On October 3, 2024, following the termination of the SPA, Penterra notified Atlas Indemnity Insurance Co. that the Transaction would not close. The $3,960,000 premium was non-refundable under the terms of the R&W Policy.

H. The Catastrophic Marlowe Asset Management-2 Clinical Trial Results

60. As described in paragraphs 33 and 34 above, VRD-4187 was in the Marlowe Asset Management-2 Phase II clinical trial at the time of the SPA's execution. Marlowe Asset Management-2 was a randomized, open-label study conducted across 42 clinical sites in the United States and European Union, with a total enrollment of 387 patients: 194 patients randomized to the VRD-4187 treatment arm and 193 patients randomized to the control arm receiving standard-of-care chemotherapy alone.

61. On August 14, 2024, the independent DMC for the Marlowe Asset Management-2 trial conducted a pre-specified interim analysis of the trial data. The results of the interim analysis were devastating and revealed a safety and efficacy profile that was fundamentally inconsistent with the commercial viability of VRD-4187.

62. Specifically, the DMC interim analysis revealed the following:

(a) Serious Adverse Events — Grade ≥3 Cytokine Release Syndrome ("CRS"). The incidence of Grade 3 or higher CRS in the VRD-4187 treatment arm was 23.4% (approximately 45 of 194 patients), compared to 4.1% (approximately 8 of 193 patients) in the control arm. This represented a difference of 19.3 percentage points and a nearly six-fold increase in the rate of serious CRS events in patients treated with VRD-4187. CRS is a systemic inflammatory response that can cause multi-organ failure, hemodynamic instability, and death. The severity and frequency of CRS observed in the VRD-4187 arm far exceeded what had been anticipated based on earlier Phase I data and represented a fundamental safety signal.

(b) Treatment-Related Deaths. Seven (7) patients in the VRD-4187 treatment arm died from treatment-related causes (3.6% of 194 patients), compared to one (1) patient who died from treatment-related causes in the control arm (0.5% of 193 patients). This represented a seven-fold increase in the treatment-related mortality rate. The seven deaths in the VRD-4187 arm were attributed to severe CRS, multi-organ failure, and CRS-related complications. These deaths cannot be reversed or explained away.

(c) Efficacy Failure. The overall response rate ("ORR") for VRD-4187 was 31.4%, compared to 28.9% for the control arm. The difference in ORR was not statistically significant (p = 0.58). This means that VRD-4187 showed no meaningful efficacy advantage over the standard of care, despite its dramatically worse safety profile. A drug that is both more dangerous and no more effective than existing therapies has no viable commercial path.

63. On August 14, 2024, based on its review of the interim analysis data, the DMC recommended immediate suspension of enrollment in the Marlowe Asset Management-2 trial and implementation of dose modifications for patients already enrolled. A true and correct copy of the DMC Interim Analysis Summary is attached hereto as Exhibit G and incorporated herein by reference.

64. On August 16, 2024, Veridian notified Penterra of the DMC's findings, pursuant to its obligations under SPA § 5.1(b), which required Veridian to promptly notify Penterra of any material developments affecting the Company's business or operations.

65. Upon receiving Veridian's notification, Penterra immediately retained Broadleaf Scientific Consulting LLC to conduct a supplemental clinical assessment of the Marlowe Asset Management-2 data. On August 19, 2024, Dr. Raymond Kapoor of Broadleaf Scientific Consulting delivered a supplemental clinical assessment to Penterra. Dr. Kapoor's assessment confirmed the severity and significance of the adverse findings and concluded that the Marlowe Asset Management-2 data raised fundamental questions about the clinical viability of VRD-4187 in its current form. A true and correct copy of the Broadleaf supplemental clinical assessment is attached hereto as Exhibit E and incorporated herein by reference.

I. The FDA Partial Clinical Hold

66. On August 22, 2024, the FDA imposed a partial clinical hold on VRD-4187 (IND 154832) pending investigation of the CRS-related deaths observed in the Marlowe Asset Management-2 trial. A true and correct copy of the FDA's partial clinical hold letter is attached hereto as Exhibit F and incorporated herein by reference.

67. An FDA clinical hold is among the most severe regulatory actions that the agency can take with respect to an investigational drug product. Under 21 C.F.R. § 312.42, a clinical hold is an order issued by the FDA to the sponsor to delay a proposed clinical investigation or to suspend an ongoing investigation. A partial clinical hold prohibits the enrollment of new patients in the trial but may permit patients already enrolled to continue receiving treatment under modified protocols. A clinical hold requires the sponsor to submit a complete response to the FDA's concerns before the hold can be lifted and the trial can resume.

68. The FDA's imposition of the partial clinical hold on VRD-4187 compounded the material adverse effect on Veridian's business by imposing regulatory restrictions that prevented further enrollment in the Marlowe Asset Management-2 trial, created substantial and ongoing uncertainty regarding the future development path for VRD-4187, and signaled to the scientific and investment communities that serious safety concerns existed with respect to the drug candidate.

69. On August 28, 2024, Veridian implemented a protocol amendment (Protocol v4.0) to the Marlowe Asset Management-2 trial. The protocol amendment added mandatory tocilizumab prophylaxis (a CRS mitigation agent) for all patients and reduced the starting dose of VRD-4187 from 1.5 mg/kg to 0.75 mg/kg. However, the protocol amendment did not and could not reverse the adverse events that had already occurred, the data that had already been generated, or the treatment-related deaths that had already been suffered. As of the date of this Verified Counterclaim, the FDA partial clinical hold on IND 154832 remained in effect and had not been lifted.

J. Penterra's Deficiency Notice and Veridian's Response

70. On September 6, 2024, Penterra sent a formal written Deficiency Notice to Veridian (with a copy to Veridian's outside counsel, Zalcourt Archer & Cole LLP), pursuant to the notice provisions of the SPA. In the Deficiency Notice, Penterra stated its position that a material adverse effect had occurred within the meaning of Section 1.1 of the SPA, that the conditions to Penterra's obligation to close under SPA §§ 7.2(a) and 7.2(b) were not satisfied, and that the failure of these conditions was not caused by or the result of any breach by Penterra of its obligations under the SPA. The Deficiency Notice detailed the grounds for Penterra's position, including the catastrophic Marlowe Asset Management-2 clinical data, the seven treatment-related deaths, the absence of any meaningful efficacy benefit, and the FDA's imposition of the partial clinical hold on IND 154832. A true and correct copy of the Deficiency Notice is attached hereto as Exhibit B and incorporated herein by reference.

71. On September 13, 2024, Veridian, through its counsel Zalcourt Archer & Cole LLP, sent a written response to Penterra's Deficiency Notice. In its response, Veridian disputed that a material adverse effect had occurred, asserting that: (a) the Marlowe Asset Management-2 clinical data was preliminary and based on an interim analysis rather than a final analysis; (b) the protocol amendment implemented on August 28, 2024 adequately addressed the safety concerns identified by the DMC; (c) the FDA's partial clinical hold was a routine regulatory action and not indicative of a fundamental problem with VRD-4187; and (d) Penterra was obligated to proceed to closing. Veridian demanded that Penterra set a date for the closing and consummate the Transaction as contemplated by the SPA. A true and correct copy of Veridian's response letter is attached hereto as Exhibit C and incorporated herein by reference.

72. The Penterra Board of Directors convened a special meeting on September 20, 2024, at which the Board received detailed presentations from Calderwood & Harkness LLP (regarding the legal analysis of the MAE provisions and Penterra's termination rights), Broadleaf Scientific Consulting LLC (regarding the clinical significance of the Marlowe Asset Management-2 data and the implications of the FDA clinical hold), and Garrison Zanthor & Co., LLC (regarding the financial implications of the adverse developments). After careful deliberation and review of all available information, the Penterra Board concluded that Veridian's response was unavailing and that the material adverse effect was both real and irreversible. The Board concluded that the Marlowe Asset Management-2 clinical data and the FDA clinical hold represented fundamental developments that could not be cured by protocol amendments or management assurances, and that proceeding to close under these circumstances would not be in the best interests of Penterra or its stockholders.

K. The Termination

73. On September 27, 2024, the Penterra Board of Directors held a further special meeting at which the Board, after additional deliberation and upon the advice of counsel, authorized the termination of the SPA pursuant to Section 8.1(d).

74. On September 30, 2024, Penterra delivered a formal Termination Notice to Veridian and to David Ng in his capacity as Stockholder Representative, terminating the SPA pursuant to Section 8.1(d). In the Termination Notice, Penterra stated that the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) of the SPA were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024, due to the occurrence and continuation of a material adverse effect within the meaning of Section 1.1 of the SPA. The Termination Notice was delivered in compliance with the SPA's notice requirements. A true and correct copy of the Termination Notice is attached hereto as Exhibit D and incorporated herein by reference.

L. Post-Termination Events

75. On October 1, 2024, Penterra notified Ironclad Trust Company, N.A., as administrative agent under the Commitment Letter, that the SPA had been terminated and requested termination of the $500,000,000 committed term loan facility.

76. On October 1, 2024, Penterra notified Fidelis National Escrow Corp. that no escrow deposits would be made in connection with the Transaction, as the SPA had been terminated and no closing would occur.

77. On October 3, 2024, Penterra notified Atlas Indemnity Insurance Co. that the Transaction would not close. As noted above, the $3,960,000 premium paid for the R&W Policy was non-refundable under the terms of the policy.

78. On October 15, 2024, Veridian, through its counsel Rebecca Whitmore, Esq. of Zalcourt Archer & Cole LLP, sent a demand letter to Penterra threatening litigation for breach of contract and seeking specific performance of the SPA, the reverse termination fee, and damages. A true and correct copy of the demand letter is attached hereto as Exhibit H and incorporated herein by reference.

79. Penterra has incurred substantial sunk transaction costs in connection with the Transaction, totaling approximately $12,991,664. These costs are itemized as follows:

80. None of these costs are recoverable by Penterra. Penterra bears the full economic loss of the sunk costs of a transaction that was destroyed by Veridian's lead drug candidate's catastrophic clinical failure — not by any action of Penterra.

COUNT I

DECLARATORY JUDGMENT — VALID TERMINATION OF THE STOCK PURCHASE AGREEMENT

A. Incorporation of Prior Allegations

81. Penterra incorporates by reference each and every allegation set forth in paragraphs 1 through 80 above as though fully set forth herein.

B. An Actual Controversy Exists

82. An actual, justiciable controversy exists between Penterra and Veridian regarding the validity of Penterra's termination of the SPA on September 30, 2024, pursuant to Section 8.1(d). The controversy is ripe for adjudication and is of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.

83. Veridian has filed a complaint in this action alleging that Penterra breached its obligations under the SPA by terminating the Agreement, and Veridian seeks, among other remedies, specific performance compelling Penterra to close the Transaction and payment of the $45,000,000 reverse termination fee. Veridian contends that no material adverse effect occurred and that Penterra's termination was wrongful.

84. Penterra denies Veridian's allegations and affirmatively contends that its termination was valid and proper under the express terms of Section 8.1(d) of the SPA, that a material adverse effect occurred and is continuing, that the closing conditions under Section 7.2 were not satisfied and were incapable of being satisfied prior to the Outside Date, and that Penterra owes no further obligations to Veridian or any of the Sellers under the SPA.

85. The resolution of this controversy requires this Court to construe and apply the provisions of the SPA — a contract governed by Delaware law — and to determine the rights and obligations of the parties thereunder. This Court is the proper forum for the resolution of this dispute, as agreed by the parties in Section 10.6 of the SPA. A declaratory judgment will terminate the uncertainty and controversy and will serve to clarify the legal relations between the parties.

C. A Material Adverse Effect Occurred

86. The Marlowe Asset Management-2 clinical trial data revealed by the DMC's August 14, 2024 interim analysis — showing a 23.4% incidence of Grade 3 or higher CRS in the VRD-4187 arm (versus 4.1% in the control arm), seven (7) treatment-related deaths in the VRD-4187 arm (versus one (1) in the control arm), and no statistically significant efficacy benefit (ORR 31.4% versus 28.9%, p = 0.58) — constitutes an event, change, development, occurrence, condition, and effect that, individually and in the aggregate, has had and would reasonably be expected to have a material adverse effect on the business, results of operations, financial condition, and assets of Veridian, taken as a whole, within the meaning of Section 1.1 of the SPA.

87. VRD-4187 was not merely one of several products in Veridian's portfolio; it was the lead and most advanced clinical candidate in Veridian's pipeline, the centerpiece of the VeriTCE platform, and the primary driver of the $900 million purchase price negotiated by the parties. The destruction of VRD-4187's clinical viability fundamentally and durably impairs the value of Veridian's business.

88. The FDA's imposition of the partial clinical hold on IND 154832 on August 22, 2024, compounds and reinforces the material adverse effect. The clinical hold imposed regulatory restrictions that prevented further enrollment in the Marlowe Asset Management-2 trial, created substantial and ongoing uncertainty regarding the future development path for VRD-4187, and effectively froze the advancement of Veridian's most important clinical program.

89. Veridian is a clinical-stage company with zero product revenue. For the fiscal year ended December 31, 2023, Veridian reported total revenue of $0 and a net loss of approximately $87.3 million. As of March 31, 2024, Veridian had approximately $112.4 million in cash and cash equivalents, which was being consumed to fund ongoing operations at a rate that gave the company a limited cash runway. Veridian's entire enterprise value is derived from the clinical promise of its pipeline, principally VRD-4187. When that clinical promise was destroyed by the Marlowe Asset Management-2 data, Veridian's enterprise value was fundamentally impaired.

90. The adverse developments described herein are durationally significant and not merely short-term hiccups or temporary setbacks. The Marlowe Asset Management-2 data cannot be unlearned or wished away. Seven patients died from treatment-related causes — those deaths are irreversible. The safety signal — a 23.4% incidence of Grade 3 or higher CRS — represents a fundamental characteristic of VRD-4187 at its tested dose, not a transient artifact. The lack of statistically significant efficacy means the drug has not demonstrated the clinical benefit necessary to justify its risk profile. The FDA clinical hold remains in effect and, even if eventually lifted, cannot erase the devastating safety data that has been generated.

91. Under the standard articulated by this Court, including in Akorn, Inc. v. Fresenius Kabi AG, 2018 WL 4719347 (Del. Ch. Oct. 1, 2018), aff'd, 198 A.3d 724 (Del. 2018), a material adverse effect is measured against the long-term value of the acquired entity as a going concern, not merely against short-term earnings or quarterly fluctuations. The Marlowe Asset Management-2 clinical results and the FDA clinical hold satisfy this standard because they fundamentally undermine the long-term commercial prospects for VRD-4187 and, by extension, Veridian's value as an ongoing enterprise. A clinical-stage biotechnology company whose lead drug candidate has demonstrated a dramatically worse safety profile than the standard of care with no corresponding efficacy benefit, and which is subject to an FDA clinical hold, has suffered a material adverse effect by any reasonable measure.

D. The MAE Carveouts Do Not Apply

92. None of the carveouts to the MAE definition set forth in Section 1.1 of the SPA shield the Marlowe Asset Management-2 clinical trial results or the FDA partial clinical hold from constituting a material adverse effect.

93. The Marlowe Asset Management-2 clinical data and the FDA's imposition of the partial clinical hold on IND 154832 are company-specific events. They relate directly and exclusively to Veridian's proprietary drug candidate, VRD-4187, and to the FDA's regulatory action directed specifically at VRD-4187. These events are not:

(i) general economic or political conditions;

(ii) conditions affecting the biotechnology or pharmaceutical industries generally;

(iii) changes in applicable law or GAAP;

(iv) pandemics or public health emergencies;

(v) natural disasters, acts of war, or terrorism;

(vi) changes in financial markets generally; or

(vii) the announcement or pendency of the Transactions.

94. No carveout in the SPA's MAE definition excludes company-specific clinical trial failures or company-specific regulatory actions from the MAE analysis. This omission was deliberate and reflects the negotiated allocation of risk between the parties. The Sellers bore the risk of clinical trial failure and adverse regulatory action, and the Buyer was entitled to walk away from the Transaction if such events caused a material adverse effect.

95. Even if Veridian were to argue that any of the enumerated carveouts applies (which Penterra denies), the disproportionate-impact exception would restore the events to the MAE analysis. The VRD-4187 clinical failures and the FDA clinical hold disproportionately affect Veridian relative to other comparably situated companies operating in the biotechnology industry. No other company in the biotechnology industry was affected by the failure of Veridian's proprietary drug candidate. The adverse events were specific and unique to VRD-4187, and their impact fell exclusively on Veridian.

E. The Buyer's Closing Conditions Were Not Satisfied

96. Section 7.2(a) of the SPA required, as a condition to Penterra's obligation to close, that the representations and warranties of the Sellers be true and correct in all respects (subject to the materiality and MAE qualifications therein) as of the Closing Date as though made on and as of such date. In light of the Marlowe Asset Management-2 clinical data and the FDA partial clinical hold, numerous representations and warranties of the Sellers — including, without limitation, representations relating to the business and operations of Veridian, the status of its regulatory filings and compliance with applicable laws and regulations, the status and condition of its product pipeline and clinical programs, and the absence of any event, change, or development constituting a material adverse effect — could not be brought down and would not be true and correct as of any prospective Closing Date.

97. Section 7.2(b) of the SPA required, as a condition to Penterra's obligation to close, that no Material Adverse Effect shall have occurred since the date of the Agreement (June 10, 2024) and be continuing as of the Closing Date. As set forth in detail above, a Material Adverse Effect has occurred since June 10, 2024 and is continuing. The catastrophic clinical data cannot be undone; the seven treatment-related deaths are irreversible; the FDA partial clinical hold remains in effect. The condition set forth in Section 7.2(b) was not satisfied as of September 30, 2024 and was incapable of being satisfied prior to the Outside Date of December 10, 2024.

98. These conditions to closing were incapable of being cured or satisfied prior to the Outside Date. The Marlowe Asset Management-2 data is a permanent feature of VRD-4187's clinical record. The seven treatment-related deaths cannot be reversed. The FDA clinical hold, even if eventually modified or lifted, could not erase the safety data generated or restore VRD-4187 to its pre-interim-analysis clinical profile. No protocol amendment, dose modification, or management action taken by Veridian before December 10, 2024 could have restored the conditions to closing to a state of satisfaction.

F. Termination Under Section 8.1(d) Was Proper

99. Section 8.1(d) of the SPA provides that the Buyer may terminate the Agreement if any condition to the Buyer's obligation to close under Section 7.2 has not been satisfied and is incapable of being satisfied prior to the Outside Date, provided that the failure to satisfy such condition was not caused by or resulted from Buyer's breach of any of its representations, warranties, covenants, or agreements set forth in the SPA.

100. Penterra satisfied all procedural and substantive requirements for termination under Section 8.1(d):

(a) Penterra delivered a Deficiency Notice to Veridian on September 6, 2024, identifying the material adverse effect and the failure of the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b).

(b) Penterra afforded Veridian more than thirty (30) days following delivery of the Deficiency Notice during which Veridian had the opportunity to cure the asserted deficiency. Veridian did not and could not cure the material adverse effect, as the clinical data, treatment-related deaths, and FDA clinical hold were not susceptible to cure.

(c) On September 30, 2024, Penterra delivered its Termination Notice to Veridian and to the Stockholder Representative, terminating the SPA pursuant to Section 8.1(d), in compliance with the SPA's notice requirements set forth in Section 10.1.

101. Penterra was not in breach of any of its representations, warranties, covenants, or agreements under the SPA at any time prior to or at the time of termination. The failure of the closing conditions set forth in Sections 7.2(a) and 7.2(b) was caused entirely by the catastrophic Marlowe Asset Management-2 clinical trial results and the FDA's imposition of the partial clinical hold — events that were wholly unrelated to any action or inaction of Penterra.

102. Penterra's termination of the SPA was therefore valid, proper, and effective in accordance with the express terms of Section 8.1(d).

G. The Reverse Termination Fee Is Not Payable

103. Section 8.3(b) of the SPA provides that the $45,000,000 reverse termination fee is payable by Penterra to the Sellers solely and exclusively in the event that Penterra fails to consummate the closing due to a failure to obtain committed financing.

104. Penterra's termination of the SPA was not based on any financing failure. At all relevant times, Penterra had approximately $2.1 billion in cash on hand, a fully committed $500 million term loan facility with Summit Ridge Capital Partners, LP, and the demonstrated ability to fund the full $900 million purchase price. The financing commitment remained fully available and in effect through the Outside Date of December 10, 2024, and was terminated only after Penterra terminated the SPA.

105. Penterra terminated the SPA based on the occurrence and continuation of a material adverse effect and the failure of the closing conditions under Sections 7.2(a) and 7.2(b) — grounds that are entirely separate and distinct from a financing failure and that do not trigger the reverse termination fee provision of Section 8.3(b).

106. Accordingly, the $45,000,000 reverse termination fee is not payable by Penterra, and Veridian has no right to demand or collect such fee.

H. Penterra Has No Further Obligations to Veridian or the Sellers

107. Pursuant to Section 8.2 of the SPA, upon valid termination of the Agreement in accordance with Section 8.1, the Agreement becomes void and of no further force or effect, and no party has any further liability or obligation to any other party under the Agreement, except for certain surviving provisions specifically identified in Section 8.2 (including confidentiality obligations, the provisions governing the effects of termination, governing law, and certain other specified provisions).

108. Upon the valid termination of the SPA on September 30, 2024, Penterra has no obligation to: (a) close the Transaction; (b) pay the $900 million purchase price; (c) deposit the $180 million indemnification escrow; (d) deposit the $2.5 million stockholder representative expense fund; (e) pay the $45 million reverse termination fee; or (f) pay any other fee, penalty, or damages to Veridian, David Ng as Stockholder Representative, or any of the Sellers.

109. Penterra is not subject to an order of specific performance. Section 10.12 of the SPA grants the Sellers the right to seek specific performance to compel Penterra to consummate the closing, but that right is expressly conditioned on the satisfaction of all conditions to Penterra's obligation to close under Article VII of the SPA. As demonstrated herein, the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) were not satisfied and were incapable of being satisfied prior to the Outside Date. Accordingly, the contractual predicate for specific performance has not been met, and specific performance is not an available remedy.

PRAYER FOR RELIEF

WHEREFORE, Counterclaim Plaintiff Penterra Pharmaceuticals Corp. respectfully requests that this Court enter judgment in its favor and against Counterclaim Defendant Veridian Biosciences, Inc. as follows:

1. Declaring that a Material Adverse Effect occurred with respect to Veridian Biosciences, Inc. within the meaning of Section 1.1 of the Stock Purchase Agreement dated June 10, 2024, as a result of the catastrophic Marlowe Asset Management-2 clinical trial results and the FDA's imposition of a partial clinical hold on VRD-4187 (IND 154832).

2. Declaring that the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) of the SPA were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024.

3. Declaring that Penterra's termination of the SPA on September 30, 2024, pursuant to Section 8.1(d), was valid, proper, and effective in all respects.

4. Declaring that Penterra has no obligation to pay the $45,000,000 reverse termination fee set forth in Section 8.3(b) of the SPA, or any other fee, penalty, or damages to Veridian or any of the Sellers under the SPA.

5. Declaring that Penterra has no further obligations to Veridian Biosciences, Inc., David Ng as Stockholder Representative, or any of the Sellers under the SPA, including no obligation to consummate the Transactions contemplated by the SPA or to pay the Purchase Price of $900,000,000.

6. Declaring that Veridian is not entitled to specific performance of the SPA, because the conditions to Penterra's obligation to close under Section 7.2 have not been satisfied and were incapable of being satisfied prior to the Outside Date, and accordingly the contractual predicate for specific performance under Section 10.12 of the SPA has not been met.

7. Awarding Penterra its reasonable attorneys' fees, costs, and expenses incurred in connection with this counterclaim, to the extent permitted by applicable law or the terms of the SPA.

8. Granting such other and further relief as this Court deems just and equitable under the circumstances.

VERIFICATION

I, Dr. Anand Rajagopal, am the Chief Executive Officer of Penterra Pharmaceuticals Corp., the Counterclaim Plaintiff in the above-captioned action. I have read the foregoing Verified Counterclaim of Penterra Pharmaceuticals Corp. for Declaratory Judgment and am familiar with the matters set forth therein. The facts stated in the Verified Counterclaim are true and correct to the best of my knowledge, information, and belief, and I make this verification subject to the penalties of perjury.

________________________________________

Dr. Anand Rajagopal Chief Executive Officer Penterra Pharmaceuticals Corp.

Date: November __, 2024

STATE OF NEW JERSEY COUNTY OF MERCER

Sworn to and subscribed before me this __ day of November, 2024.

________________________________________

Notary Public

My Commission Expires: ____

Dated: November 1, 2024

Respectfully submitted,

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
VERIFIED COUNTERCLAIM OF PENTERRA PHARMACEUTICALS CORP. FOR DECLARATORY JUDGMENT
Penterra Pharmaceuticals Corp. ("Penterra" or "Counterclaim Plaintiff"), by and through its undersigned attorneys, Calderwood & Harkness LLP, brings this Verified Counterclaim for Declaratory Judgment against Veridian Biosciences, Inc. ("Veridian" or "Counterclaim Defendant") and respectfully alleges as follows.
INTRODUCTION
1.  This case arises from the catastrophic failure of a clinical-stage drug candidate and the rights of a would-be acquirer to walk away from a $900 million acquisition when the very asset it agreed to purchase has been fundamentally destroyed.
2.  On June 10, 2024, Penterra entered into a Stock Purchase Agreement (the "SPA" or the "Agreement") to acquire one hundred percent (100%) of the outstanding capital stock of Veridian for $900,000,000 in cash (the "Transaction"). A true and correct copy of the SPA is attached hereto as Exhibit A and incorporated herein by reference.
3.  Penterra entered into the SPA based on the commercial promise of Veridian's lead drug candidate, VRD-4187, a bispecific T-cell engager targeting DLL3-expressing tumors for the treatment of small cell lung cancer ("SCLC"). VRD-4187 was the centerpiece of Veridian's pipeline, the principal driver of the $900 million purchase price, and the foundation upon which Penterra's strategic rationale for the acquisition rested.
4.  Following the execution of the SPA, VRD-4187 suffered catastrophic clinical trial results. On August 14, 2024, the independent Data Monitoring Committee ("DMC") for the Phase II Marlowe Asset Management-2 clinical trial conducted a pre-specified interim analysis. The results were devastating: VRD-4187 demonstrated a statistically significant increase in serious adverse events, including Grade 3 or higher cytokine release syndrome ("CRS") in 23.4% of patients in the VRD-4187 treatment arm (compared to 4.1% in the control arm) — a nearly six-fold increase. Seven patients in the VRD-4187 arm died from treatment-related causes, compared to one patient in the control arm — a seven-fold increase in the mortality rate. At the same time, VRD-4187 showed no meaningful efficacy advantage over the standard of care, with an overall response rate ("ORR") of 31.4% versus 28.9% for the control arm, a difference that was not statistically significant (p = 0.58).
5.  On August 22, 2024, the United States Food and Drug Administration (the "FDA") imposed a partial clinical hold on VRD-4187 (IND 154832), one of the most severe regulatory actions the agency can take with respect to an investigational drug, pending investigation of the CRS-related deaths. The clinical hold prohibited new enrollment in the Marlowe Asset Management-2 trial and required Veridian to submit a complete response before the trial could resume.
6.  These developments constituted a material adverse effect on Veridian's business, results of operations, financial condition, and assets, taken as a whole, within the meaning of Section 1.1 of the SPA. Veridian is a clinical-stage company with zero product revenue, a FY2023 net loss of $87.3 million, and an enterprise value derived entirely from the clinical promise of its pipeline — principally VRD-4187. The destruction of VRD-4187's clinical viability fundamentally and durably impaired the value of Veridian as an ongoing enterprise.
7.  Penterra lawfully terminated the SPA on September 30, 2024, pursuant to Section 8.1(d), on the grounds that the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024, due to the occurrence and continuation of a material adverse effect. A true and correct copy of the Termination Notice is attached hereto as Exhibit D and incorporated herein by reference.
8.  Penterra now seeks a declaratory judgment from this Court confirming the validity of that termination and declaring that Penterra has no further obligations to Veridian or the Sellers under the SPA, including no obligation to pay the $45,000,000 reverse termination fee, no obligation to consummate the Transaction, and no obligation to pay the $900 million purchase price.
NATURE OF THE ACTION
9.  This is a counterclaim for declaratory relief pursuant to 10 Del. C. § 6501 et seq. (the Delaware Declaratory Judgment Act) and Court of Chancery Rule 57.
10.  Penterra seeks a declaration from this Court that:
(a) a material adverse effect occurred with respect to the business, results of operations, financial condition, and assets of Veridian Biosciences, Inc., taken as a whole, within the meaning of Section 1.1 of the SPA;
(b) the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) of the SPA were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024;
(c) Penterra's termination of the SPA on September 30, 2024, pursuant to Section 8.1(d), was valid and effective; and
(d) Penterra has no further obligations to Veridian or any of the Sellers under the SPA, including no obligation to pay the $45,000,000 reverse termination fee.
11.  An actual controversy exists between the parties regarding the validity of the termination. Veridian has filed a complaint in this action alleging that Penterra breached its obligations under the SPA by terminating the Agreement and seeking, among other remedies, specific performance compelling Penterra to close the Transaction. Penterra denies those allegations and affirmatively contends that its termination was proper and that it owes no further obligations to Veridian or any of the Sellers.
12.  A judicial declaration resolving this controversy is necessary and appropriate to settle the rights and legal relations of the parties and to afford relief from the uncertainty and controversy giving rise to this proceeding.
THE PARTIES
A. Counterclaim Plaintiff
13.  Penterra Pharmaceuticals Corp. ("Penterra") is a corporation duly organized and existing under the laws of the State of Delaware, with its principal executive office located at 1100 Meridian Boulevard, Suite 400, Princeton, New Jersey 08540.
14.  Penterra is publicly traded on the Nasdaq Stock Market under the ticker symbol "PPCA." As of June 2024, Penterra had a market capitalization of approximately $14.2 billion.
15.  Penterra's registered agent for service of process in the State of Delaware is Capitol Corporate Services, Inc., located at 1675 South Ashbury Asset Advisors, Suite B, Dover, Delaware 19901.
16.  Penterra is a mid-cap specialty pharmaceutical company with a diversified commercial portfolio of twelve (12) marketed products across the oncology, immunology, and rare disease therapeutic areas. For the fiscal year ended December 31, 2023, Penterra reported consolidated revenue of approximately $4.87 billion and net income of approximately $612 million.
17.  Penterra's Chief Executive Officer is Dr. Anand Rajagopal. Penterra's General Counsel and Secretary is Thomas F. Holbrook.
B. Counterclaim Defendant
18.  Veridian Biosciences, Inc. ("Veridian") is a corporation duly organized and existing under the laws of the State of Delaware, with its principal office located at 550 Gateway Drive, Cambridge, Massachusetts 02142.
19.  Veridian is a privately held, clinical-stage biotechnology company focused on the development of immuno-oncology therapeutics. Veridian was founded in 2016 by Dr. Julian Marek, who serves as its Chief Executive Officer, and Dr. Priya Chandrasekaran, who serves as its Chief Scientific Officer.
20.  Veridian's registered agent for service of process in the State of Delaware is Tidewater Registered Agents LLC, located at 838 Walker Road, Suite 21-2, Dover, Delaware 19904.
21.  At the time of the SPA's execution, Veridian had approximately 148 employees. Veridian has no product revenue. For the fiscal year ended December 31, 2023, Veridian reported total revenue of $0 and a net loss of approximately $87.3 million. Veridian has funded its operations through private equity financing, having raised approximately $420 million across Series A through Series D funding rounds.
22.  Veridian's major stockholders include Crestline Ventures, LP (approximately 28.3% of outstanding stock), Boreal Health Partners Fund III, LP (approximately 19.7% of outstanding stock), and Apex Growth Equity Fund II, LP (approximately 14.1% of outstanding stock). Together, these three stockholders hold approximately 62.1% of Veridian's outstanding capital stock.
C. Non-Party Stockholder Representative
23.  David Ng, Managing Partner of Crestline Ventures, LP, serves as the Stockholder Representative under the SPA on behalf of the Sellers (as defined in the SPA). Although Mr. Ng is not a party to this counterclaim, his role as Stockholder Representative is relevant to the facts and circumstances alleged herein.
JURISDICTION AND VENUE
24.  This Court has subject matter jurisdiction over this counterclaim pursuant to 10 Del. C. § 341, which vests the Court of Chancery with general equity jurisdiction, and pursuant to 6 Del. C. § 18-111.
25.  This Court has jurisdiction over this counterclaim pursuant to Section 10.6 of the SPA, which provides, in relevant part, that the parties irrevocably submit to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, the Superior Court of the State of Delaware or the United States District Court for the District of Delaware) for the purpose of any action, suit, or proceeding arising out of or relating to the SPA or the transactions contemplated thereby.
26.  Venue is proper in New Castle County, Delaware. Both Penterra and Veridian are corporations organized under the laws of the State of Delaware, and both parties have consented to the exclusive jurisdiction and venue of this Court under Section 10.6 of the SPA.
27.  The SPA is governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice-of-law or conflict-of-law provisions, as set forth in Section 10.6 of the SPA.
28.  Pursuant to Section 10.6 of the SPA, each of the parties irrevocably waived any objection that it may now or hereafter have to the laying of venue of any action, suit, or proceeding arising out of or relating to the SPA in this Court, and irrevocably waived and agreed not to plead or claim that any such action, suit, or proceeding brought in this Court has been brought in an inconvenient forum.
FACTUAL BACKGROUND
A. The Parties and Their Businesses
29.  Penterra is a mid-cap specialty pharmaceutical company with a diversified commercial portfolio of twelve (12) marketed products across the oncology, immunology, and rare disease therapeutic areas. Penterra is listed on the Nasdaq Stock Market under the ticker symbol "PPCA" and had a market capitalization of approximately $14.2 billion as of June 2024. For the fiscal year ended December 31, 2023, Penterra reported consolidated revenue of approximately $4.87 billion.
30.  In November 2023, Penterra experienced a significant setback to its internal oncology pipeline. On November 18, 2023, a pre-planned futility analysis of Penterra's Phase III clinical trial of PPC-0921, an anti-PD-L1/TIM-3 bispecific antibody, failed to demonstrate a statistically significant improvement in progression-free survival compared to the control arm. The Penterra Board of Directors and management team recognized that this setback created a strategic need to bolster Penterra's immuno-oncology pipeline through external acquisition.
31.  Veridian is a clinical-stage biotechnology company founded in 2016 by Dr. Julian Marek and Dr. Priya Chandrasekaran. Veridian has developed a proprietary technology platform known as VeriTCE (Veridian T-Cell Engager), which enables the engineering of bispecific T-cell engager molecules designed to redirect the patient's own T-cells to attack cancer cells expressing specific target antigens.
32.  At the time of the SPA's execution, Veridian had three immuno-oncology candidates leveraging the VeriTCE platform in various stages of clinical and preclinical development. Veridian has never generated product revenue. For the fiscal year ended December 31, 2023, Veridian reported total revenue of $0 and a net loss of approximately $87.3 million. Veridian had approximately $112.4 million in cash and cash equivalents as of March 31, 2024. Since its founding, Veridian has raised approximately $420 million across its Series A through Series D financing rounds.
33.  Veridian's lead and most advanced clinical candidate was VRD-4187, a bispecific T-cell engager targeting DLL3-expressing tumors, principally for the treatment of small cell lung cancer ("SCLC"). VRD-4187 was Veridian's flagship product, the most advanced candidate in its pipeline, and the primary asset underpinning Veridian's enterprise value.
34.  At the time of the SPA's execution, VRD-4187 was in Phase II clinical trials. The pivotal trial, known as Marlowe Asset Management-2 (ClinicalTrials.gov Identifier NCT05837291), was a randomized, open-label study designed to evaluate the safety and efficacy of VRD-4187 in combination with standard chemotherapy compared to standard chemotherapy alone in patients with previously treated SCLC. The Marlowe Asset Management-2 trial was being conducted across 42 clinical sites in the United States and European Union, with 387 enrolled patients (194 in the VRD-4187 treatment arm and 193 in the control arm).
B. The Stock Purchase Agreement
35.  On February 12, 2024, the Penterra Board of Directors held a special meeting at which management presented a strategic assessment of potential acquisition targets in the immuno-oncology space. Following discussion and deliberation, the Board authorized Dr. Rajagopal and the management team to explore an acquisition of Veridian, subject to Board approval of any definitive agreement.
36.  On March 1, 2024, Penterra submitted a non-binding indication of interest to Veridian and its financial advisor, Ridgeway Partners LLC, expressing Penterra's interest in acquiring all of the outstanding capital stock of Veridian at an indicative enterprise value of $850 million to $950 million, subject to satisfactory completion of due diligence and negotiation and execution of a definitive agreement.
37.  On March 4, 2024, Penterra and Veridian executed a mutual Confidentiality Agreement governing the exchange of non-public information in connection with the potential transaction.
38.  Commencing on March 11, 2024, Penterra conducted extensive due diligence on Veridian's business, operations, financial condition, intellectual property, regulatory affairs, and clinical programs. As part of this process, Penterra retained Broadleaf Scientific Consulting LLC, led by Dr. Raymond Kapoor, to conduct a clinical due diligence review of Veridian's pipeline, with particular emphasis on the VRD-4187 program and the Marlowe Asset Management-2 trial. Penterra also engaged Garrison Zanthor & Co., LLC as its financial advisor, with Kevin Driscoll, Managing Director, as the lead advisor on the transaction.
39.  The due diligence process extended over approximately three months. During this period, Penterra's advisors reviewed clinical data, regulatory filings, manufacturing agreements, intellectual property portfolios, employment matters, and financial projections provided by Veridian and its advisors. The clinical due diligence conducted by Broadleaf Scientific Consulting was based on the data available as of that time, which did not include the results of the interim analysis subsequently performed by the DMC on August 14, 2024.
40.  On June 9, 2024, Garrison Zanthor & Co., LLC delivered a fairness opinion to Penterra's Board of Directors, opining that, as of that date and based upon and subject to the assumptions, qualifications, and limitations set forth therein, the $900 million purchase price to be paid by Penterra pursuant to the SPA was fair, from a financial point of view, to Penterra.
41.  The SPA was fully negotiated, executed, and delivered on June 10, 2024. Dr. Anand Rajagopal executed the SPA on behalf of Penterra, Dr. Julian Marek executed the SPA on behalf of Veridian, and David Ng executed the SPA in his capacity as Stockholder Representative on behalf of the Sellers.
42.  The SPA contains the following key terms, among others:
(a) Purchase Price. Penterra agreed to pay $900,000,000 in cash (the "Purchase Price") in exchange for one hundred percent (100%) of the outstanding capital stock of Veridian. (SPA § 2.1.) The SPA did not provide for any purchase price adjustment based on the cash on Veridian's balance sheet at closing.
(b) Escrow Arrangements. At closing, $180,000,000 (representing 20% of the Purchase Price) was to be deposited into an indemnification escrow account, and $2,500,000 was to be deposited into a stockholder representative expense fund, in each case with Fidelis National Escrow Corp. as escrow agent. (SPA § 2.3.) The net closing payment to the Sellers was therefore $717,500,000 ($900,000,000 minus $180,000,000 minus $2,500,000).
(c) Indemnification. The general indemnification cap was set at $180,000,000 (20% of the Purchase Price). The cap for breaches of fundamental representations (including representations regarding organization, authority, capitalization, and title to shares) was set at $900,000,000 (100% of the Purchase Price). A tipping basket of $9,000,000 (1% of the Purchase Price) applied to general indemnification claims, meaning that no indemnification was payable unless aggregate losses exceeded $9,000,000, at which point the Sellers would be liable for the full amount of losses from the first dollar. General representations survived for 18 months following the closing; fundamental representations survived for the full statute of limitations applicable to such representations plus 60 days. (SPA §§ 9.1–9.4.)
(d) No-Shop Provision. Veridian and the Sellers agreed to a customary no-shop provision prohibiting them from soliciting, encouraging, or engaging in discussions or negotiations with respect to any alternative acquisition proposal. The no-shop provision included a limited fiduciary out permitting the Veridian Board to respond to an unsolicited superior proposal, subject to four (4) business days' matching rights in favor of Penterra. (SPA § 5.4.)
(e) Reverse Termination Fee. A reverse termination fee of $45,000,000 (5% of the Purchase Price) was payable by Penterra to the Sellers, triggered solely and exclusively by Penterra's failure to consummate the closing due to a failure to obtain committed financing. (SPA § 8.3(b).)
(f) Target Termination Fee. A target termination fee of $36,000,000 (4% of the Purchase Price) was payable by Veridian to Penterra, triggered by the Sellers' breach of the no-shop provision. (SPA § 8.3(a).)
(g) Outside Date. The SPA provided for an Outside Date of December 10, 2024, which was 180 days following the date of execution. (SPA § 8.1(b).)
(h) Governing Law and Exclusive Jurisdiction. The SPA is governed by the laws of the State of Delaware, and the parties agreed to the exclusive jurisdiction of the Court of Chancery of the State of Delaware for all disputes arising out of or relating to the SPA. (SPA § 10.6.)
(i) Specific Performance. Section 10.12 of the SPA grants the Sellers the right to seek specific performance to compel Penterra to consummate the closing, but only if all conditions to Penterra's obligation to close under Article VII have been satisfied or waived.
C. The Material Adverse Effect Definition
43.  The term "Material Adverse Effect" (or "MAE") is defined in Section 1.1 of the SPA. The MAE definition is central to this counterclaim and is quoted in relevant part below:
"'Material Adverse Effect' means any event, change, development, occurrence, condition or effect that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on (a) the business, results of operations, financial condition or assets of the Company, taken as a whole, or (b) the ability of the Sellers to consummate the Transactions."
44.  The MAE definition includes certain carveouts, which exclude from the definition of Material Adverse Effect changes arising from or relating to:
(i) general economic or political conditions;
(ii) conditions affecting the biotechnology or pharmaceutical industries generally;
(iii) changes in applicable law or United States generally accepted accounting principles ("GAAP");
(iv) pandemics, including COVID-19 and any similar public health emergencies;
(v) natural disasters, acts of war, or terrorism;
(vi) changes in financial markets generally; and
(vii) the announcement or pendency of the Transactions contemplated by the SPA.
45.  Carveouts (i) through (vi) are subject to a "disproportionate impact" exception. Specifically, the SPA provides that the foregoing carveouts shall not apply to the extent that the relevant event, change, development, occurrence, condition, or effect disproportionately affects the Company (Veridian) relative to other comparably situated companies operating in the biotechnology industry. The disproportionate-impact exception is significant because it restores to the MAE analysis any general or industry-wide condition that has a disproportionate impact on Veridian specifically.
46.  Critically, the MAE carveouts enumerated in the SPA do not include any carveout for (a) company-specific clinical trial results, (b) regulatory actions directed at the Company's products, or (c) adverse changes to the Company's product pipeline. The absence of such carveouts is significant and reflects the parties' deliberate allocation of the risk of clinical trial failure and adverse regulatory action to the Sellers and the Company, rather than to the Buyer.
D. The Buyer's Closing Conditions
47.  Article VII of the SPA sets forth the conditions to each party's obligation to consummate the Transaction. Section 7.2 specifies the conditions to Penterra's obligation to close, including, among others:
(a) Bring-Down of Representations and Warranties (§ 7.2(a)). The representations and warranties of the Sellers set forth in the SPA must be true and correct in all respects (except where qualified by materiality or material adverse effect, in which case such representations and warranties must be true and correct in all material respects) as of the Closing Date as though made on and as of such date (except to the extent that such representations and warranties expressly relate to an earlier date, in which case they must be true and correct as of such earlier date).
(b) No Material Adverse Effect (§ 7.2(b)). No Material Adverse Effect shall have occurred since the date of the Agreement (June 10, 2024) and be continuing as of the Closing Date.
48.  Section 7.2 also conditions closing on compliance by the Company and the Sellers with their respective covenants and agreements, delivery of officer's certificates confirming satisfaction of conditions, delivery of customary closing deliverables, and certain other conditions. These conditions are not at issue in this counterclaim.
E. Regulatory Approvals Obtained
49.  On April 22, 2024, Penterra filed the required pre-merger notification under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), with the Federal Trade Commission (the "FTC") and the Antitrust Division of the United States Department of Justice. The HSR Act filing fee was $280,500.
50.  On May 20, 2024, the FTC granted early termination of the waiting period under the HSR Act, and the antitrust condition to closing was fully satisfied. No second request for additional information or documentary material was issued by either the FTC or the Antitrust Division.
51.  On June 14, 2024, Veridian obtained the required stockholder approval of the Transaction through execution of a written consent by stockholders holding more than ninety percent (90%) of Veridian's outstanding capital stock, in accordance with Section 228 of the Delaware General Corporation Law and Section 5.2 of the SPA.
52.  As of the date of this Verified Counterclaim, all regulatory approvals necessary for the consummation of the Transaction had been obtained. The failure of the Transaction was not attributable to any regulatory impediment.
F. Financing Arrangements
53.  At all relevant times, Penterra had ample financial resources to consummate the Transaction. As of the end of the second fiscal quarter of 2024, Penterra had approximately $2.1 billion in unrestricted cash and cash equivalents on its balance sheet.
54.  On June 7, 2024, Penterra entered into a committed term loan facility in the amount of $500,000,000 (the "Commitment Letter," Ref. CL-2024-PPCA-0607), with Summit Ridge Capital Partners, LP as lead arranger and Ironclad Trust Company, N.A. as administrative agent. The term loan bore interest at SOFR plus 225 basis points, with a commitment fee of 0.35% per annum and a ticking fee of 0.175% per annum commencing September 8, 2024. The financing commitment was co-terminous with the SPA Outside Date of December 10, 2024.
55.  Penterra's intended funding plan for the Transaction was to draw $500 million from the committed term loan facility and to fund the remaining $400 million from Penterra's existing cash on hand.
56.  At no point during the period between the execution of the SPA and Penterra's termination of the SPA did Penterra's financing fail, become unavailable, or become subject to any condition that was not capable of being satisfied. Penterra had the financial ability to close the Transaction at all times. The termination of the SPA was not caused by or related to any financing failure, and the reverse termination fee provision of Section 8.3(b) was never triggered.
G. The Representation and Warranty Insurance Policy
57.  On June 12, 2024, in connection with the Transaction, Penterra caused to be bound a buyer-side representation and warranty insurance policy (the "R&W Policy") issued by Atlas Indemnity Insurance Co. (Policy No. AIC-RWI-2024-07892). The R&W Policy was brokered by Prescott Whitfield Insurance Brokers, Inc.
58.  The R&W Policy had a policy limit of $180,000,000, matching the general indemnification cap under the SPA, and a self-insured retention of $9,000,000, matching the indemnification tipping basket. The total premium for the R&W Policy was $3,960,000, plus an underwriting fee of $75,000.
59.  On October 3, 2024, following the termination of the SPA, Penterra notified Atlas Indemnity Insurance Co. that the Transaction would not close. The $3,960,000 premium was non-refundable under the terms of the R&W Policy.
H. The Catastrophic Marlowe Asset Management-2 Clinical Trial Results
60.  As described in paragraphs 33 and 34 above, VRD-4187 was in the Marlowe Asset Management-2 Phase II clinical trial at the time of the SPA's execution. Marlowe Asset Management-2 was a randomized, open-label study conducted across 42 clinical sites in the United States and European Union, with a total enrollment of 387 patients: 194 patients randomized to the VRD-4187 treatment arm and 193 patients randomized to the control arm receiving standard-of-care chemotherapy alone.
61.  On August 14, 2024, the independent DMC for the Marlowe Asset Management-2 trial conducted a pre-specified interim analysis of the trial data. The results of the interim analysis were devastating and revealed a safety and efficacy profile that was fundamentally inconsistent with the commercial viability of VRD-4187.
62.  Specifically, the DMC interim analysis revealed the following:
(a) Serious Adverse Events — Grade ≥3 Cytokine Release Syndrome ("CRS"). The incidence of Grade 3 or higher CRS in the VRD-4187 treatment arm was 23.4% (approximately 45 of 194 patients), compared to 4.1% (approximately 8 of 193 patients) in the control arm. This represented a difference of 19.3 percentage points and a nearly six-fold increase in the rate of serious CRS events in patients treated with VRD-4187. CRS is a systemic inflammatory response that can cause multi-organ failure, hemodynamic instability, and death. The severity and frequency of CRS observed in the VRD-4187 arm far exceeded what had been anticipated based on earlier Phase I data and represented a fundamental safety signal.
(b) Treatment-Related Deaths. Seven (7) patients in the VRD-4187 treatment arm died from treatment-related causes (3.6% of 194 patients), compared to one (1) patient who died from treatment-related causes in the control arm (0.5% of 193 patients). This represented a seven-fold increase in the treatment-related mortality rate. The seven deaths in the VRD-4187 arm were attributed to severe CRS, multi-organ failure, and CRS-related complications. These deaths cannot be reversed or explained away.
(c) Efficacy Failure. The overall response rate ("ORR") for VRD-4187 was 31.4%, compared to 28.9% for the control arm. The difference in ORR was not statistically significant (p = 0.58). This means that VRD-4187 showed no meaningful efficacy advantage over the standard of care, despite its dramatically worse safety profile. A drug that is both more dangerous and no more effective than existing therapies has no viable commercial path.
63.  On August 14, 2024, based on its review of the interim analysis data, the DMC recommended immediate suspension of enrollment in the Marlowe Asset Management-2 trial and implementation of dose modifications for patients already enrolled. A true and correct copy of the DMC Interim Analysis Summary is attached hereto as Exhibit G and incorporated herein by reference.
64.  On August 16, 2024, Veridian notified Penterra of the DMC's findings, pursuant to its obligations under SPA § 5.1(b), which required Veridian to promptly notify Penterra of any material developments affecting the Company's business or operations.
65.  Upon receiving Veridian's notification, Penterra immediately retained Broadleaf Scientific Consulting LLC to conduct a supplemental clinical assessment of the Marlowe Asset Management-2 data. On August 19, 2024, Dr. Raymond Kapoor of Broadleaf Scientific Consulting delivered a supplemental clinical assessment to Penterra. Dr. Kapoor's assessment confirmed the severity and significance of the adverse findings and concluded that the Marlowe Asset Management-2 data raised fundamental questions about the clinical viability of VRD-4187 in its current form. A true and correct copy of the Broadleaf supplemental clinical assessment is attached hereto as Exhibit E and incorporated herein by reference.
I. The FDA Partial Clinical Hold
66.  On August 22, 2024, the FDA imposed a partial clinical hold on VRD-4187 (IND 154832) pending investigation of the CRS-related deaths observed in the Marlowe Asset Management-2 trial. A true and correct copy of the FDA's partial clinical hold letter is attached hereto as Exhibit F and incorporated herein by reference.
67.  An FDA clinical hold is among the most severe regulatory actions that the agency can take with respect to an investigational drug product. Under 21 C.F.R. § 312.42, a clinical hold is an order issued by the FDA to the sponsor to delay a proposed clinical investigation or to suspend an ongoing investigation. A partial clinical hold prohibits the enrollment of new patients in the trial but may permit patients already enrolled to continue receiving treatment under modified protocols. A clinical hold requires the sponsor to submit a complete response to the FDA's concerns before the hold can be lifted and the trial can resume.
68.  The FDA's imposition of the partial clinical hold on VRD-4187 compounded the material adverse effect on Veridian's business by imposing regulatory restrictions that prevented further enrollment in the Marlowe Asset Management-2 trial, created substantial and ongoing uncertainty regarding the future development path for VRD-4187, and signaled to the scientific and investment communities that serious safety concerns existed with respect to the drug candidate.
69.  On August 28, 2024, Veridian implemented a protocol amendment (Protocol v4.0) to the Marlowe Asset Management-2 trial. The protocol amendment added mandatory tocilizumab prophylaxis (a CRS mitigation agent) for all patients and reduced the starting dose of VRD-4187 from 1.5 mg/kg to 0.75 mg/kg. However, the protocol amendment did not and could not reverse the adverse events that had already occurred, the data that had already been generated, or the treatment-related deaths that had already been suffered. As of the date of this Verified Counterclaim, the FDA partial clinical hold on IND 154832 remained in effect and had not been lifted.
J. Penterra's Deficiency Notice and Veridian's Response
70.  On September 6, 2024, Penterra sent a formal written Deficiency Notice to Veridian (with a copy to Veridian's outside counsel, Zalcourt Archer & Cole LLP), pursuant to the notice provisions of the SPA. In the Deficiency Notice, Penterra stated its position that a material adverse effect had occurred within the meaning of Section 1.1 of the SPA, that the conditions to Penterra's obligation to close under SPA §§ 7.2(a) and 7.2(b) were not satisfied, and that the failure of these conditions was not caused by or the result of any breach by Penterra of its obligations under the SPA. The Deficiency Notice detailed the grounds for Penterra's position, including the catastrophic Marlowe Asset Management-2 clinical data, the seven treatment-related deaths, the absence of any meaningful efficacy benefit, and the FDA's imposition of the partial clinical hold on IND 154832. A true and correct copy of the Deficiency Notice is attached hereto as Exhibit B and incorporated herein by reference.
71.  On September 13, 2024, Veridian, through its counsel Zalcourt Archer & Cole LLP, sent a written response to Penterra's Deficiency Notice. In its response, Veridian disputed that a material adverse effect had occurred, asserting that: (a) the Marlowe Asset Management-2 clinical data was preliminary and based on an interim analysis rather than a final analysis; (b) the protocol amendment implemented on August 28, 2024 adequately addressed the safety concerns identified by the DMC; (c) the FDA's partial clinical hold was a routine regulatory action and not indicative of a fundamental problem with VRD-4187; and (d) Penterra was obligated to proceed to closing. Veridian demanded that Penterra set a date for the closing and consummate the Transaction as contemplated by the SPA. A true and correct copy of Veridian's response letter is attached hereto as Exhibit C and incorporated herein by reference.
72.  The Penterra Board of Directors convened a special meeting on September 20, 2024, at which the Board received detailed presentations from Calderwood & Harkness LLP (regarding the legal analysis of the MAE provisions and Penterra's termination rights), Broadleaf Scientific Consulting LLC (regarding the clinical significance of the Marlowe Asset Management-2 data and the implications of the FDA clinical hold), and Garrison Zanthor & Co., LLC (regarding the financial implications of the adverse developments). After careful deliberation and review of all available information, the Penterra Board concluded that Veridian's response was unavailing and that the material adverse effect was both real and irreversible. The Board concluded that the Marlowe Asset Management-2 clinical data and the FDA clinical hold represented fundamental developments that could not be cured by protocol amendments or management assurances, and that proceeding to close under these circumstances would not be in the best interests of Penterra or its stockholders.
K. The Termination
73.  On September 27, 2024, the Penterra Board of Directors held a further special meeting at which the Board, after additional deliberation and upon the advice of counsel, authorized the termination of the SPA pursuant to Section 8.1(d).
74.  On September 30, 2024, Penterra delivered a formal Termination Notice to Veridian and to David Ng in his capacity as Stockholder Representative, terminating the SPA pursuant to Section 8.1(d). In the Termination Notice, Penterra stated that the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) of the SPA were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024, due to the occurrence and continuation of a material adverse effect within the meaning of Section 1.1 of the SPA. The Termination Notice was delivered in compliance with the SPA's notice requirements. A true and correct copy of the Termination Notice is attached hereto as Exhibit D and incorporated herein by reference.
L. Post-Termination Events
75.  On October 1, 2024, Penterra notified Ironclad Trust Company, N.A., as administrative agent under the Commitment Letter, that the SPA had been terminated and requested termination of the $500,000,000 committed term loan facility.
76.  On October 1, 2024, Penterra notified Fidelis National Escrow Corp. that no escrow deposits would be made in connection with the Transaction, as the SPA had been terminated and no closing would occur.
77.  On October 3, 2024, Penterra notified Atlas Indemnity Insurance Co. that the Transaction would not close. As noted above, the $3,960,000 premium paid for the R&W Policy was non-refundable under the terms of the policy.
78.  On October 15, 2024, Veridian, through its counsel Rebecca Whitmore, Esq. of Zalcourt Archer & Cole LLP, sent a demand letter to Penterra threatening litigation for breach of contract and seeking specific performance of the SPA, the reverse termination fee, and damages. A true and correct copy of the demand letter is attached hereto as Exhibit H and incorporated herein by reference.
79.  Penterra has incurred substantial sunk transaction costs in connection with the Transaction, totaling approximately $12,991,664. These costs are itemized as follows:
80.  None of these costs are recoverable by Penterra. Penterra bears the full economic loss of the sunk costs of a transaction that was destroyed by Veridian's lead drug candidate's catastrophic clinical failure — not by any action of Penterra.
COUNT I
DECLARATORY JUDGMENT — VALID TERMINATION OF THE STOCK PURCHASE AGREEMENT
A. Incorporation of Prior Allegations
81.  Penterra incorporates by reference each and every allegation set forth in paragraphs 1 through 80 above as though fully set forth herein.
B. An Actual Controversy Exists
82.  An actual, justiciable controversy exists between Penterra and Veridian regarding the validity of Penterra's termination of the SPA on September 30, 2024, pursuant to Section 8.1(d). The controversy is ripe for adjudication and is of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.
83.  Veridian has filed a complaint in this action alleging that Penterra breached its obligations under the SPA by terminating the Agreement, and Veridian seeks, among other remedies, specific performance compelling Penterra to close the Transaction and payment of the $45,000,000 reverse termination fee. Veridian contends that no material adverse effect occurred and that Penterra's termination was wrongful.
84.  Penterra denies Veridian's allegations and affirmatively contends that its termination was valid and proper under the express terms of Section 8.1(d) of the SPA, that a material adverse effect occurred and is continuing, that the closing conditions under Section 7.2 were not satisfied and were incapable of being satisfied prior to the Outside Date, and that Penterra owes no further obligations to Veridian or any of the Sellers under the SPA.
85.  The resolution of this controversy requires this Court to construe and apply the provisions of the SPA — a contract governed by Delaware law — and to determine the rights and obligations of the parties thereunder. This Court is the proper forum for the resolution of this dispute, as agreed by the parties in Section 10.6 of the SPA. A declaratory judgment will terminate the uncertainty and controversy and will serve to clarify the legal relations between the parties.
C. A Material Adverse Effect Occurred
86.  The Marlowe Asset Management-2 clinical trial data revealed by the DMC's August 14, 2024 interim analysis — showing a 23.4% incidence of Grade 3 or higher CRS in the VRD-4187 arm (versus 4.1% in the control arm), seven (7) treatment-related deaths in the VRD-4187 arm (versus one (1) in the control arm), and no statistically significant efficacy benefit (ORR 31.4% versus 28.9%, p = 0.58) — constitutes an event, change, development, occurrence, condition, and effect that, individually and in the aggregate, has had and would reasonably be expected to have a material adverse effect on the business, results of operations, financial condition, and assets of Veridian, taken as a whole, within the meaning of Section 1.1 of the SPA.
87.  VRD-4187 was not merely one of several products in Veridian's portfolio; it was the lead and most advanced clinical candidate in Veridian's pipeline, the centerpiece of the VeriTCE platform, and the primary driver of the $900 million purchase price negotiated by the parties. The destruction of VRD-4187's clinical viability fundamentally and durably impairs the value of Veridian's business.
88.  The FDA's imposition of the partial clinical hold on IND 154832 on August 22, 2024, compounds and reinforces the material adverse effect. The clinical hold imposed regulatory restrictions that prevented further enrollment in the Marlowe Asset Management-2 trial, created substantial and ongoing uncertainty regarding the future development path for VRD-4187, and effectively froze the advancement of Veridian's most important clinical program.
89.  Veridian is a clinical-stage company with zero product revenue. For the fiscal year ended December 31, 2023, Veridian reported total revenue of $0 and a net loss of approximately $87.3 million. As of March 31, 2024, Veridian had approximately $112.4 million in cash and cash equivalents, which was being consumed to fund ongoing operations at a rate that gave the company a limited cash runway. Veridian's entire enterprise value is derived from the clinical promise of its pipeline, principally VRD-4187. When that clinical promise was destroyed by the Marlowe Asset Management-2 data, Veridian's enterprise value was fundamentally impaired.
90.  The adverse developments described herein are durationally significant and not merely short-term hiccups or temporary setbacks. The Marlowe Asset Management-2 data cannot be unlearned or wished away. Seven patients died from treatment-related causes — those deaths are irreversible. The safety signal — a 23.4% incidence of Grade 3 or higher CRS — represents a fundamental characteristic of VRD-4187 at its tested dose, not a transient artifact. The lack of statistically significant efficacy means the drug has not demonstrated the clinical benefit necessary to justify its risk profile. The FDA clinical hold remains in effect and, even if eventually lifted, cannot erase the devastating safety data that has been generated.
91.  Under the standard articulated by this Court, including in Akorn, Inc. v. Fresenius Kabi AG, 2018 WL 4719347 (Del. Ch. Oct. 1, 2018), aff'd, 198 A.3d 724 (Del. 2018), a material adverse effect is measured against the long-term value of the acquired entity as a going concern, not merely against short-term earnings or quarterly fluctuations. The Marlowe Asset Management-2 clinical results and the FDA clinical hold satisfy this standard because they fundamentally undermine the long-term commercial prospects for VRD-4187 and, by extension, Veridian's value as an ongoing enterprise. A clinical-stage biotechnology company whose lead drug candidate has demonstrated a dramatically worse safety profile than the standard of care with no corresponding efficacy benefit, and which is subject to an FDA clinical hold, has suffered a material adverse effect by any reasonable measure.
D. The MAE Carveouts Do Not Apply
92.  None of the carveouts to the MAE definition set forth in Section 1.1 of the SPA shield the Marlowe Asset Management-2 clinical trial results or the FDA partial clinical hold from constituting a material adverse effect.
93.  The Marlowe Asset Management-2 clinical data and the FDA's imposition of the partial clinical hold on IND 154832 are company-specific events. They relate directly and exclusively to Veridian's proprietary drug candidate, VRD-4187, and to the FDA's regulatory action directed specifically at VRD-4187. These events are not:
(i) general economic or political conditions;
(ii) conditions affecting the biotechnology or pharmaceutical industries generally;
(iii) changes in applicable law or GAAP;
(iv) pandemics or public health emergencies;
(v) natural disasters, acts of war, or terrorism;
(vi) changes in financial markets generally; or
(vii) the announcement or pendency of the Transactions.
94.  No carveout in the SPA's MAE definition excludes company-specific clinical trial failures or company-specific regulatory actions from the MAE analysis. This omission was deliberate and reflects the negotiated allocation of risk between the parties. The Sellers bore the risk of clinical trial failure and adverse regulatory action, and the Buyer was entitled to walk away from the Transaction if such events caused a material adverse effect.
95.  Even if Veridian were to argue that any of the enumerated carveouts applies (which Penterra denies), the disproportionate-impact exception would restore the events to the MAE analysis. The VRD-4187 clinical failures and the FDA clinical hold disproportionately affect Veridian relative to other comparably situated companies operating in the biotechnology industry. No other company in the biotechnology industry was affected by the failure of Veridian's proprietary drug candidate. The adverse events were specific and unique to VRD-4187, and their impact fell exclusively on Veridian.
E. The Buyer's Closing Conditions Were Not Satisfied
96.  Section 7.2(a) of the SPA required, as a condition to Penterra's obligation to close, that the representations and warranties of the Sellers be true and correct in all respects (subject to the materiality and MAE qualifications therein) as of the Closing Date as though made on and as of such date. In light of the Marlowe Asset Management-2 clinical data and the FDA partial clinical hold, numerous representations and warranties of the Sellers — including, without limitation, representations relating to the business and operations of Veridian, the status of its regulatory filings and compliance with applicable laws and regulations, the status and condition of its product pipeline and clinical programs, and the absence of any event, change, or development constituting a material adverse effect — could not be brought down and would not be true and correct as of any prospective Closing Date.
97.  Section 7.2(b) of the SPA required, as a condition to Penterra's obligation to close, that no Material Adverse Effect shall have occurred since the date of the Agreement (June 10, 2024) and be continuing as of the Closing Date. As set forth in detail above, a Material Adverse Effect has occurred since June 10, 2024 and is continuing. The catastrophic clinical data cannot be undone; the seven treatment-related deaths are irreversible; the FDA partial clinical hold remains in effect. The condition set forth in Section 7.2(b) was not satisfied as of September 30, 2024 and was incapable of being satisfied prior to the Outside Date of December 10, 2024.
98.  These conditions to closing were incapable of being cured or satisfied prior to the Outside Date. The Marlowe Asset Management-2 data is a permanent feature of VRD-4187's clinical record. The seven treatment-related deaths cannot be reversed. The FDA clinical hold, even if eventually modified or lifted, could not erase the safety data generated or restore VRD-4187 to its pre-interim-analysis clinical profile. No protocol amendment, dose modification, or management action taken by Veridian before December 10, 2024 could have restored the conditions to closing to a state of satisfaction.
F. Termination Under Section 8.1(d) Was Proper
99.  Section 8.1(d) of the SPA provides that the Buyer may terminate the Agreement if any condition to the Buyer's obligation to close under Section 7.2 has not been satisfied and is incapable of being satisfied prior to the Outside Date, provided that the failure to satisfy such condition was not caused by or resulted from Buyer's breach of any of its representations, warranties, covenants, or agreements set forth in the SPA.
100.  Penterra satisfied all procedural and substantive requirements for termination under Section 8.1(d):
(a) Penterra delivered a Deficiency Notice to Veridian on September 6, 2024, identifying the material adverse effect and the failure of the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b).
(b) Penterra afforded Veridian more than thirty (30) days following delivery of the Deficiency Notice during which Veridian had the opportunity to cure the asserted deficiency. Veridian did not and could not cure the material adverse effect, as the clinical data, treatment-related deaths, and FDA clinical hold were not susceptible to cure.
(c) On September 30, 2024, Penterra delivered its Termination Notice to Veridian and to the Stockholder Representative, terminating the SPA pursuant to Section 8.1(d), in compliance with the SPA's notice requirements set forth in Section 10.1.
101.  Penterra was not in breach of any of its representations, warranties, covenants, or agreements under the SPA at any time prior to or at the time of termination. The failure of the closing conditions set forth in Sections 7.2(a) and 7.2(b) was caused entirely by the catastrophic Marlowe Asset Management-2 clinical trial results and the FDA's imposition of the partial clinical hold — events that were wholly unrelated to any action or inaction of Penterra.
102.  Penterra's termination of the SPA was therefore valid, proper, and effective in accordance with the express terms of Section 8.1(d).
G. The Reverse Termination Fee Is Not Payable
103.  Section 8.3(b) of the SPA provides that the $45,000,000 reverse termination fee is payable by Penterra to the Sellers solely and exclusively in the event that Penterra fails to consummate the closing due to a failure to obtain committed financing.
104.  Penterra's termination of the SPA was not based on any financing failure. At all relevant times, Penterra had approximately $2.1 billion in cash on hand, a fully committed $500 million term loan facility with Summit Ridge Capital Partners, LP, and the demonstrated ability to fund the full $900 million purchase price. The financing commitment remained fully available and in effect through the Outside Date of December 10, 2024, and was terminated only after Penterra terminated the SPA.
105.  Penterra terminated the SPA based on the occurrence and continuation of a material adverse effect and the failure of the closing conditions under Sections 7.2(a) and 7.2(b) — grounds that are entirely separate and distinct from a financing failure and that do not trigger the reverse termination fee provision of Section 8.3(b).
106.  Accordingly, the $45,000,000 reverse termination fee is not payable by Penterra, and Veridian has no right to demand or collect such fee.
H. Penterra Has No Further Obligations to Veridian or the Sellers
107.  Pursuant to Section 8.2 of the SPA, upon valid termination of the Agreement in accordance with Section 8.1, the Agreement becomes void and of no further force or effect, and no party has any further liability or obligation to any other party under the Agreement, except for certain surviving provisions specifically identified in Section 8.2 (including confidentiality obligations, the provisions governing the effects of termination, governing law, and certain other specified provisions).
108.  Upon the valid termination of the SPA on September 30, 2024, Penterra has no obligation to: (a) close the Transaction; (b) pay the $900 million purchase price; (c) deposit the $180 million indemnification escrow; (d) deposit the $2.5 million stockholder representative expense fund; (e) pay the $45 million reverse termination fee; or (f) pay any other fee, penalty, or damages to Veridian, David Ng as Stockholder Representative, or any of the Sellers.
109.  Penterra is not subject to an order of specific performance. Section 10.12 of the SPA grants the Sellers the right to seek specific performance to compel Penterra to consummate the closing, but that right is expressly conditioned on the satisfaction of all conditions to Penterra's obligation to close under Article VII of the SPA. As demonstrated herein, the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) were not satisfied and were incapable of being satisfied prior to the Outside Date. Accordingly, the contractual predicate for specific performance has not been met, and specific performance is not an available remedy.
PRAYER FOR RELIEF
WHEREFORE, Counterclaim Plaintiff Penterra Pharmaceuticals Corp. respectfully requests that this Court enter judgment in its favor and against Counterclaim Defendant Veridian Biosciences, Inc. as follows:
1.  Declaring that a Material Adverse Effect occurred with respect to Veridian Biosciences, Inc. within the meaning of Section 1.1 of the Stock Purchase Agreement dated June 10, 2024, as a result of the catastrophic Marlowe Asset Management-2 clinical trial results and the FDA's imposition of a partial clinical hold on VRD-4187 (IND 154832).
2.  Declaring that the conditions to Penterra's obligation to close under Sections 7.2(a) and 7.2(b) of the SPA were not satisfied and were incapable of being satisfied prior to the Outside Date of December 10, 2024.
3.  Declaring that Penterra's termination of the SPA on September 30, 2024, pursuant to Section 8.1(d), was valid, proper, and effective in all respects.
4.  Declaring that Penterra has no obligation to pay the $45,000,000 reverse termination fee set forth in Section 8.3(b) of the SPA, or any other fee, penalty, or damages to Veridian or any of the Sellers under the SPA.
5.  Declaring that Penterra has no further obligations to Veridian Biosciences, Inc., David Ng as Stockholder Representative, or any of the Sellers under the SPA, including no obligation to consummate the Transactions contemplated by the SPA or to pay the Purchase Price of $900,000,000.
6.  Declaring that Veridian is not entitled to specific performance of the SPA, because the conditions to Penterra's obligation to close under Section 7.2 have not been satisfied and were incapable of being satisfied prior to the Outside Date, and accordingly the contractual predicate for specific performance under Section 10.12 of the SPA has not been met.
7.  Awarding Penterra its reasonable attorneys' fees, costs, and expenses incurred in connection with this counterclaim, to the extent permitted by applicable law or the terms of the SPA.
8.  Granting such other and further relief as this Court deems just and equitable under the circumstances.
VERIFICATION
I, Dr. Anand Rajagopal, am the Chief Executive Officer of Penterra Pharmaceuticals Corp., the Counterclaim Plaintiff in the above-captioned action. I have read the foregoing Verified Counterclaim of Penterra Pharmaceuticals Corp. for Declaratory Judgment and am familiar with the matters set forth therein. The facts stated in the Verified Counterclaim are true and correct to the best of my knowledge, information, and belief, and I make this verification subject to the penalties of perjury.
________________________________________
Dr. Anand Rajagopal Chief Executive Officer Penterra Pharmaceuticals Corp.
Date: November __, 2024
STATE OF NEW JERSEY COUNTY OF MERCER
Sworn to and subscribed before me this __ day of November, 2024.
________________________________________
Notary Public
My Commission Expires: ____
Dated: November 1, 2024
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
By: ________
Oliver Mackenzie (Partner) Megan Chu (Associate)
200 Park Avenue, 42nd Floor New York, New York 10166 Telephone: (212) 558-4000 Facsimile: (212) 558-3588
Attorneys for Defendant and Counterclaim Plaintiff Penterra Pharmaceuticals Corp.
CERTIFICATE OF SERVICE
I, Oliver Mackenzie, hereby certify that on November __, 2024, a true and correct copy of the foregoing Verified Counterclaim of Penterra Pharmaceuticals Corp. for Declaratory Judgment was served upon counsel for Plaintiff and Counterclaim Defendant Veridian Biosciences, Inc. by the following means:
Via Electronic Filing (File & ServeXpress) and Electronic Mail:
Rebecca Whitmore, Esq. Jonathan Pratt, Esq. Zalcourt Archer & Cole LLP One Federal Street, 30th Floor Boston, Massachusetts 02110 rwhitmore@lathamarcher.com jpratt@lathamarcher.com
Counsel for Plaintiff and Counterclaim Defendant Veridian Biosciences, Inc.
________________________________________
Oliver Mackenzie
APPENDIX — EXHIBIT LIST
The following exhibits are referenced in the foregoing Verified Counterclaim and are attached hereto or will be filed contemporaneously herewith:
VERIDIAN BIOSCIENCES, INC., a Delaware corporation,
Plaintiff,
v. | C.A. No. 2024-__
PENTERRA PHARMACEUTICALS CORP., a Delaware corporation,
Defendant.
Cost Category | Amount
Calderwood & Harkness LLP — Legal Fees | $4,250,000
Garrison Zanthor & Co., LLC — Financial Advisory Fee | $2,500,000
Broadleaf Scientific Consulting LLC — Clinical Due Diligence Fees | $875,000
Stonebridge HSW LLP — Antitrust Counsel Fees | $310,000
Atlas Indemnity Insurance Co. — R&W Insurance Premium | $3,960,000
Atlas Indemnity Insurance Co. — R&W Underwriting Fee | $75,000
Federal Trade Commission — HSR Filing Fee | $280,500
Summit Ridge Capital Partners, LP — Commitment Fee Accrued | $556,164
Miscellaneous Transaction Costs | $185,000
Total | $12,991,664
Exhibit | Description
Exhibit A | Stock Purchase Agreement dated June 10, 2024 (execution version), by and among Penterra Pharmaceuticals Corp., Veridian Biosciences, Inc., the Sellers named therein, and David Ng as Stockholder Representative
Exhibit B | Deficiency Notice from Penterra Pharmaceuticals Corp. to Veridian Biosciences, Inc. dated September 6, 2024
Exhibit C | Response Letter from Veridian Biosciences, Inc. (through Zalcourt Archer & Cole LLP) to Penterra Pharmaceuticals Corp. dated September 13, 2024
Exhibit D | Termination Notice from Penterra Pharmaceuticals Corp. to Veridian Biosciences, Inc. and David Ng, as Stockholder Representative, dated September 30, 2024
Exhibit E | Broadleaf Scientific Consulting LLC — Supplemental Clinical Assessment re: VRD-4187 / Marlowe Asset Management-2 Trial dated August 19, 2024
Exhibit F | FDA Partial Clinical Hold Letter re: IND 154832 (VRD-4187) dated August 22, 2024
Exhibit G | Marlowe Asset Management-2 Data Monitoring Committee Interim Analysis Summary dated August 14, 2024
Exhibit H | Demand Letter from Veridian Biosciences, Inc. (through Zalcourt Archer & Cole LLP) to Penterra Pharmaceuticals Corp. dated October 15, 2024