krys-20211231ex106_emplo






        sf-3750204KBca   E M P L O Y M E N T  A G R E E M E N T   This Employment Agreement (“the Agreement”), dated December 6, 2021, is between  Krystal Biotech, Inc., a Delaware corporation (the “Company”) and Jing L. Marantz  (“Employee”) and reflects the Company’s and Employee’s desire to establish a full  employment relationship.  We kindly request this document be signed and returned to  us before December 13, 2021.  1.  POSITION AND RESPONSIBILITIES  a. Position.  Employee is employed by the Company to render services to  the Company in the position of Executive Vice President and Chief Business Officer  commencing January 18, 2022 (“Start Date”).  This position will report to the CEO,  Krish Krishnan, and will be part of the senior leadership team of the Company,  including designation as a Section 16 officer.  Effective as of the Start Date, Employee  will also step down from her position as a member of Krystal’s board of directors.   Employee shall perform such duties and responsibilities as are normally related to  similar positions in accordance with the standards of the industry and any additional  duties now or hereafter assigned to Employee by the Company.  Employee shall abide  by the rules, regulations, and practices as adopted or modified from time to time in  the Company’s sole discretion. Employee’s primary location shall be in Boston, MA,  with travel to Company’s Headquarters in Pittsburgh, PA, as required.  This  employment offer is subject to approval by the board of directors and is contingent  upon the completion of a satisfactory reference check, background check and drug  screen.   b. Other Activities.  Except upon the prior written consent of the Company,  Employee will not, during the term of this Agreement, (i) accept any other  employment, or (ii) engage, directly or indirectly, in any other business activity  (whether or not pursued for pecuniary advantage) that might interfere with  Employee’s duties and responsibilities hereunder or create a conflict of interest with  the Company.  c. No Conflict.  Employee represents and warrants that Employee’s  execution of this Agreement, Employee’s employment with the Company, and the  performance of Employee’s proposed duties under this Agreement shall not violate any  obligations Employee may have to any other employer, person or entity, including any  obligations with respect to proprietary or confidential information of any other person  or entity.  





 






   2  sf-3750204 KBca  2.  COMPENSATION AND BENEFITS  a. Base Salary and Bonus.  In consideration of the services to be rendered  under this Agreement, the Company shall pay Employee a base salary at the rate of    FOUR HUNDRED AND TWENTY-FIVE THOUSAND DOLLARS ($425,000) per year (“Base  Salary”) with a target bonus of up to 45% of the annual base salary, subject to  meeting corporate and individual goals.  The target bonus will be prorated during  Employee’s first year of employment.  This position is considered Tier 2, which means  25% of the target bonus will be based upon individual performance, while 75% of the  target bonus will be based upon corporate performance.  The corporate performance  portion of the bonus will be measured upon attainment of performance objectives  during the calendar year as determined by the Krystal board of directors.  The bonus  payout shall occur upon Krystal board of directors’ approval of the attainment of goals,  likely to be on or before March 15th following the calendar year in which the bonus is  measured. Employee must be employed by the Company and be in good standing at  the time of payout in order to be eligible to receive payment.  b. The Base Salary shall be paid in accordance with the Company’s regularly  established payroll practice.    c. Employee’s Total Compensation will be reviewed by the Compensation  Committee from time to time in accordance with the established procedures of the  Company for adjusting salaries for similarly situated employees and may be adjusted  in the sole discretion of the Company.   d. Equity Grants. The Employee will be awarded options to purchase  205,000 shares of the common stock of Krystal, as adjusted by any stock splits that  may occur.  The exercise price per share of any approved options will be the closing  price of Krystal’s common stock on January 31, 2022. Any and all equity grants shall  vest in four equal annual installments commencing on the Employee’s first  anniversary.  Employee’s entitlement to any equity grant is conditioned upon  Employee’s signing of an appropriate Equity Incentive Agreement and the terms of the  relevant equity incentive plans under which the options are granted, including vesting  requirements.    e. Benefits.  Employee shall be eligible to participate in the benefits made  generally available by the Company to similarly situated employees, in accordance  with the benefit plans established by the Company, and as may be amended from time  to time at the Company’s sole discretion.   f. Expenses.  The Company shall reimburse Employee for reasonable  business expenses incurred in the performance of Employee’s duties hereunder, in  accordance with the Company’s travel and expense policy.  





 






   3  sf-3750204 KBca  3.  AT-WILL EMPLOYMENT; TERMINATION BY COMPANY  a. At-Will Termination by Company.  The employment of Employee shall  be “at-will” at all times.  The Company may terminate Employee’s employment with  the Company at any time, without any advance notice, for any reason or no reason at  all, notwithstanding anything to the contrary contained in or arising from any  statements, policies or practices of the Company relating to the employment,  discipline or termination of its employees.  Upon and after such termination, all  obligations of the Company under this Agreement shall cease.  In the event of any  such termination by the Company for any reason other than Cause, the Company shall  pay to Employee an amount equal to six months of her then-current Base Salary,  which payment may, at the request of the Company, be conditioned upon Employee’s  execution of a usual and customary general release in favor of the Company.  “Cause”  shall be defined as any of the following:  (i) an intentional act of fraud, embezzlement,  theft or any other material violation of law that occurs during or in the course of  Employee’s employment with company; (ii) intentional damage to the Company’s  assets; (iii) intentional disclosure of Company’s confidential information contrary to  Company’s policies; (iv) intentional breach of Employee’s obligations under this  agreement; (v) intentional engagement in any competitive activity which would  constitute a breach of Employee’s duty of loyalty or of Employee’s obligations under  this agreement; (vi) intentional breach of any of the Company’s policies; (vii) the  willful and/or continued failure to substantially perform Employee’s duties for company  (other than as a result of incapacity due to physical or mental illness); (viii) inability to  make agreed upon improvements resulting from a clearly outlined and mutually  agreed upon Performance Improvement Plan (“PIP”) or (ix) willful conduct by  Employee that is demonstrably and materially injurious to company, monetarily or  otherwise.  4.  AT-WILL EMPLOYMENT; TERMINATION BY EMPLOYEE  a. At-Will Termination by Employee.  Employee may terminate  employment with the Company at any time for any reason or no reason at all, upon  thirty days’ advance written notice.  During such notice period Employee shall continue  to diligently perform all of Employee’s duties hereunder.  The Company shall have the  option, in its sole discretion, to make Employee’s termination effective at any time  prior to the end of such notice period as long as the Company pays Employee all  compensation to which Employee is entitled up through the last day of the thirty-day  notice period.  Thereafter all obligations of the Company shall cease.  





 






   4  sf-3750204 KBca  5.  TERMINATION OBLIGATIONS  a. Return of Property.  Employee agrees that all property (including  without limitation all equipment, tangible proprietary information, documents, records,  notes, contracts and computer-generated materials) furnished to or created or  prepared by Employee incident to Employee’s employment belongs to the Company  and shall be promptly returned to the Company upon termination of Employee’s  employment.  b. Resignation and Cooperation.  Following any termination of  employment, Employee shall cooperate with the Company in the winding up of  pending work on behalf of the Company and the orderly transfer of work to other  employees.  Employee shall also cooperate with the Company in the defense of any  action brought by any third party against the Company that relates to Employee’s  employment by the Company.  c. Continuing Obligations.  Employee understands and agrees that  Employee’s obligations under Sections 5 and 6 herein (including Exhibit A) shall  survive the termination of Employee’s employment for any reason and the termination  of this Agreement.  6.  INVENTIONS AND PROPRIETARY INFORMATION; PROHIBITION ON  THIRD PARTY INFORMATION  a. Proprietary Information Agreement.  Employee agrees to sign and be  bound by the terms of the Company’s Proprietary Information and Inventions  Agreement, which is attached as Exhibit A (“Proprietary Information Agreement”).    b. Non-Disclosure of Third-Party Information.  Employee represents and  warrants and covenants that Employee shall not disclose to the Company, or use, or  induce the Company to use, any proprietary information or trade secrets of others at  any time, including but not limited to any proprietary information or trade secrets of  any former employer, if any; and Employee acknowledges and agrees that any  violation of this provision shall be grounds for Employee’s immediate termination and  could subject Employee to substantial civil liabilities and criminal penalties.  Employee  further specifically and expressly acknowledges that no officer or other employee or  representative of the Company has requested or instructed Employee to disclose or  use any such third-party proprietary information or trade secrets.  c. Noncompetition. In consideration of the Company’s extension to  Employee of full time employment with the Company, the Employee agrees that at no  time during the Employee’s employment with the Company, and for a period of one  (1) year immediately following the termination of such employment (regardless of the  





 






   5  sf-3750204 KBca  reason for or the party initiating the termination), the Employee will not, directly or  indirectly, on the Employee’s own behalf or on behalf of any third party, in any  capacity (whether as a proprietor, stockholder, partner, officer, employee, consultant,  contractor, or otherwise), work for, be a consultant for, be employed by, or provide  strategic advice to any Competitor, where the services the Employee would render to  the Competitor are similar to those which the Employee performed for the Company.  As used herein, Competitor means any person or entity that (a) is engaged in the  development of products or technologies which may compete with the products or  technologies under development by the Company at the time of Employee’s  termination or within the twelve (12) month period immediately preceding such  termination; and (b) is located within the territory of the United States. This provision  does not apply to (1) the Employees’ passive ownership of not more than 2% of the  outstanding, publicly traded securities of another company; and (2) work in a capacity  that is unrelated to development or of products or technologies which may compete  with those under development by the Company.   7.  AMENDMENTS; WAIVERS; REMEDIES  This Agreement may not be amended or waived except by a writing signed by  Employee and by a duly authorized officer of the Company.  Failure to exercise any  right under this Agreement shall not constitute a waiver of such right.  Any waiver of  any breach of this Agreement shall not operate as a waiver of any subsequent  breaches.  All rights or remedies specified for a party herein shall be cumulative and in  addition to all other rights and remedies of the party hereunder or under applicable  law.  8.  ASSIGNMENT; BINDING EFFECT  a. Assignment.  The performance of Employee is personal hereunder, and  Employee agrees that Employee shall have no right to assign and shall not assign or  purport to assign any rights or obligations under this Agreement.  This Agreement may  be assigned or transferred by the Company, including in connection with any  conversion of the Company into corporate form; and nothing in this Agreement shall  prevent the consolidation, merger or sale of the Company or a sale of any or all or  substantially all of its assets.  b. Binding Effect.  Subject to the foregoing restriction on assignment by  Employee, this Agreement shall inure to the benefit of and be binding upon each of the  parties; the affiliates, officers, directors, agents, successors and assigns of the  Company; and the heirs, devisees, spouses, legal representatives and successors of  Employee.  





 






   6  sf-3750204 KBca  9.  NOTICES  All notices or other communications required or permitted hereunder shall be made in  writing and shall be deemed to have been duly given if delivered:  (a) by hand; (b) by  a nationally recognized overnight courier service; or (c) by United States first class  registered or certified mail, return receipt requested, to the principal address of the  other party, as set forth below.  The date of notice shall be deemed to be the earlier of  (i) actual receipt of notice by any permitted means, or (ii) five business days following  dispatch by overnight delivery service or the United States Mail.  Employee shall be  obligated to notify the Company in writing of any change in Employee’s address.   Notice of change of address shall be effective only when done in accordance with this  paragraph.  Company’s Notice Address:  Krystal Biotech, Inc.  2100 Wharton Street, Suite 310  Pittsburgh, PA 15203  Attention: Josh Suskin  Email: jsuskin@krystalbio.com    Employee’s Contact Information:    Jing L. Marantz  157 Aspinwall Avenue  Brookline, MA 02446  Email: jnj.marantz@gmail.com                                  10.    SEVERABILITY  If any provision of this Agreement shall be held by a court or arbitrator to be invalid,  unenforceable, or void, such provision shall be enforced to the fullest extent permitted  by law, and the remainder of this Agreement shall remain in full force and effect.  In  the event that the time period or scope of any provision is declared by a court or  arbitrator of competent jurisdiction to exceed the maximum time period or scope that  such court or arbitrator deems enforceable, then such court or arbitrator shall reduce  the time period or scope to the maximum time period or scope permitted by law.  11.  TAXES  All amounts paid under this Agreement shall be paid less all applicable state and  federal tax withholdings and any other withholdings required by any applicable  jurisdiction or authorized by Employee.  





 






   7  sf-3750204 KBca  12.  GOVERNING LAW  This Agreement shall be governed by and construed in accordance with the laws of the  Commonwealth of Pennsylvania without regard to the conflict of law principles. Parties  agree to first try to mediate any conflict arising under this Agreement or a matter  related thereto. If such a conflict cannot be resolved through mediation, then any suit  or action shall be brought in an appropriate federal or state court located in Allegheny  County, Pennsylvania.   13.  INTERPRETATION  This Agreement shall be construed as a whole, according to its fair meaning, and not  in favor of or against any party.  Sections and section headings contained in this  Agreement are for reference purposes only and shall not affect in any manner the  meaning or interpretation of this Agreement.  Whenever the context requires,  references to the singular shall include the plural and the plural the singular.   14.  COUNTERPARTS  This Agreement may be executed in any number of counterparts, each of which shall  be deemed an original of this Agreement, but all of which together shall constitute one  and the same instrument.   15.  AUTHORITY  Each party represents and warrants that such party has the right, power and authority  to enter into and execute this Agreement and to perform and discharge all of the  obligations hereunder; and that this Agreement constitutes the valid and legally  binding agreement and obligation of such party and is enforceable in accordance with  its terms.  16.  ENTIRE AGREEMENT  This Agreement is intended to be the final, complete, and exclusive statement of the  terms of Employee’s employment by the Company and may not be contradicted by  evidence of any prior or contemporaneous statements or agreements, except for  agreements specifically referenced herein (including the Employee Proprietary  Information and Inventions Agreement attached as Exhibit A and the Company’s  Equity Incentive Plan and Equity Incentive Agreement).  To the extent that the  practices, policies or procedures of the Company, now or in the future, apply to  





 






   8  sf-3750204 KBca  Employee and are inconsistent with the terms of this Agreement, the provisions of this  Agreement shall control.  Any subsequent change in Employee’s duties, position, or  compensation will not affect the validity or scope of this Agreement.  17.  EMPLOYEE ACKNOWLEDGEMENT  Employee acknowledges that Employee has had the opportunity to consult  legal counsel concerning this agreement, that Employee has read and  understands the agreement, that Employee is fully aware of its legal effect,  and that Employee has entered into it freely based on Employee’s own  judgment and not on any representations or promises other than those  contained in this agreement.  IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date  first written above.   KRYSTAL BIOTECH, INC. Jing L. Marantz  By: ______________________                     _________________________    Kathryn Romano   Name:  Title:  Chief Accounting Officer    Employee