Document:

EX-10.3

 Exhibit 10.3 
  

 
 Aldexa Therapeutics, Inc. 

15 New England Executive Park 

Burlington MA 01803 
 Scott L. Young 

325 Speen Street 
 Unit 1012 

Natick, MA 01776 
 July 15, 2013 

Dear Scott, 
 On behalf of Aldexa Therapeutics,
Inc. (“Aldexa” or the “Company”), we are very pleased to provide you with a summary of the terms and conditions of your continued employment by Aldexa. The following sets forth the updated terms and conditions of your employment.

 1. Position. Your position will continue to be Chief Operating Officer. As an Aldexa employee, we expect that you will perform any and all
duties and responsibilities normally associated with your position in a satisfactory manner and to the best of your abilities at all times.  
 2.
Nature of Relationship. You will be expected to continue to devote all of your working time to the performance of your duties at Aldexa throughout your employment. No provision of this letter shall be construed to create an express or
implied employment contract, or a promise of employment for any specific period of time. Your employment with Aldexa is at-will employment which may be terminated by you or Aldexa at any time for any reason with or without advance notice.

 3. Compensation and Benefits. Your base pay shall continue at a rate of $25,000.00, payable monthly ($300,000 on an annualized basis)
minus customary deductions for federal and state taxes and the like. Assuming you are still employed by Aldexa, you will also be eligible to receive a cash bonus of 20% of your annual salary at the end of Aldexa’s fiscal year. The award
shall be determined at the sole discretion of the Board of Directors, and the bonus will be based on your job performance and the overall financial performance of Aldexa. Any bonus will be paid within 15 days following the end of Aldexa’s
fiscal year. 
 In addition to your compensation, you may take advantage of various benefits, including vacation, offered by Aldexa. Aldexa
offers vacation pay for four weeks annually. All benefits, of course, may be modified or changed from time to time at the sole discretion of Aldexa, and the provision of such benefits to you in no way changes or impacts your status as an at-will

 
employee. Where a particular benefit is subject to a formal plan (for example, medical insurance), eligibility to participate in and receive any particular benefit is governed solely by the
applicable formal plan document. 
 4. Severance Benefits. 

(A) General. Following a Qualified Financing, subject to the approval of the Board in its sole discretion (the “Post Financing
Board Approval”), you may be eligible for the benefits described in this Section 4 if you are subject to an Involuntary Termination. However, this Section 4 will not apply unless you (i) have returned all Company property in your
possession and (ii) have executed a general release of all claims that you may have against the Company or persons affiliated with the Company. The release must be in the form prescribed by the Company, without alterations. You must execute and
return the release on or before the date specified by the Company in the prescribed form (the “Release Deadline”). The Release Deadline will in no event be later than 50 days after your Separation. If you fail to return the release on or
before the Release Deadline, or if you revoke the release, then you will not be entitled to the benefits described in this Section 4. 

(B) Salary Continuation. If following the Post Financing Board Approval you are subject to an Involuntary Termination, then the Company
will continue to pay your base salary for a period of up to six (6) months (as determined by the Board) after your Separation (the “Continuation Period”). Your base salary will be paid, if at all, at the rate in effect at the time of
your Separation and in accordance with the Company’s standard payroll procedures. The salary continuation payments, if any, will commence within 60 days after your Separation and, once any payments commence, will include any unpaid amounts
accrued from the date of your Separation (such commencement date, the “Payment Commencement Date”). However, if the 60-day period described in the preceding sentence spans two calendar years, then any payments will in any event begin in
the second calendar year. 
 (C) Bonus Payment. If following the Post Financing Board Approval, if any, you are subject to an
Involuntary Termination, then the Company shall pay you an amount equal to a pro rata portion of your target annual bonus based on the length of the Continuation Period. Such amount shall be payable in a lump sum on the Company’s next
regularly scheduled payroll that occurs following the Payment Commencement Date. 
 5. Equity. In addition to your prior equity holdings, the
Board of Directors has recently approved an equity grant to you of 2% fully diluted stock, with additional 1% to vest if the investors recoup all investment during Series B. The vesting schedule for the 2% fully diluted options is 25% after one year
and the remainder monthly over three years thereafter. Vesting commenced on April 15, 2013. The exercise price of the options will be equal to the fair market value of the Company’s common stock, which was $0.27 per share at the date of
the grants. An option agreement that provides more detail on this benefit will be made available to you. You agree that you have no rights to and are not otherwise entitled to any additional equity in the Company. 

  
 2 

 6. Your Certifications To Aldexa. As a condition of your employment: 

You hereby continue to certify to Aldexa that you are free to enter into and fully perform the duties of your position and that you are not
subject to any employment, confidentiality, non-competition or other agreement that would restrict your performance for Aldexa. You further hereby certify that your signing this letter with Aldexa does not violate any order, judgment or injunction
applicable to you, or conflict with or breach any agreement to which you are a party or by which you are bound. 
 7. Eligibility to Work.
Your employment with Aldexa is conditioned on your eligibility to work in the United States. Upon signing this letter agreement, you must complete an I-9 Form and provide Aldexa with any of the accepted forms of identification specified on the I-9
Form. 
 8. Confidentiality, Non-Competition and Work Product. Like all Aldexa employees, you were required to sign and return an agreement
relating to confidentiality, non-competition and work product on or before your first day of work, as a condition of your employment (the “Confidentiality and Non-competition Agreement”). A copy of the Confidentiality and
Non-Competition Agreement is enclosed for your consideration. 
 9. Tax Matters. 

(A) Withholding. All forms of compensation referred to in this letter agreement are subject to reduction to reflect applicable
withholding and payroll taxes and other deductions required by law. 
 (B) Section 409A. For purposes of Section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”), any payments under Section 4(B) and Section 4(C) are hereby designated as a separate payment. If the Company determines that you are a “specified employee”
under Section 409A(a)(2)(B)(i) of the Code at the time of your Separation, then (i) the payments under Section 4(B) and Section 4(C) (if any), to the extent that they are subject to Section 409A of the Code, will commence on
the first business day following (a) expiration of the six-month period measured from your Separation or (b) the date of your death and (ii) the installments that otherwise would have been paid prior to such date will be paid in a
lump sum when the salary continuation payments commence. 
 (C) Tax Advice. You are encouraged to obtain your own tax advice
regarding your compensation from the Company. You agree that the Company does not have a duty to design its compensation policies in a manner that minimizes your tax liabilities, and you will not make any claim against the Company or its Board of
Directors related to tax liabilities arising from your compensation. 
 10. Definitions. The following terms have the meaning set forth below
wherever they are used in this letter agreement: 
 “Cause” means (a) your unauthorized use or disclosure of the
Company’s confidential information or trade secrets, which use or disclosure causes material harm to the Company, (b) your material breach of any agreement between you and the Company, (c) your material failure to comply with the
Company’s written policies or rules, (d) your conviction of, or your plea of “guilty” or “no contest” to, a felony under the laws of the United States or any State, (e) your gross negligence or willful misconduct,
(f) your continuing failure to perform 

  
 3 

 
assigned duties after receiving written notification of the failure from the Company’s Board of Directors or (g) your failure to cooperate in good faith with a governmental or internal
investigation of the Company or its directors, officers or employees, if the Company has requested your cooperation. 

“Separation” means a “separation from service,” as defined in the regulations under Section 409A of the Code.

 “Involuntary Termination” means a Separation as a result of a termination of your employment by the Company without
Cause, provided you are willing and able to continue performing services within the meaning of Treasury Regulation 1.409A-1(n)(1). 

“Qualified Financing” means a bona-fide equity financing of the Company occurring after the date hereof in which the Company
receives in a single transaction gross proceeds (excluding the amount of any proceeds as a result of the conversion of indebtedness) of at least $1,000,000. Notwithstanding the foregoing, for the purposes hereof, any proceeds received by the Company
as a result of the sale of shares of the Company’s Series B Preferred Stock pursuant to that certain Series B Preferred Stock and Warrant Purchase Agreement, dated as of December 20, 2012 shall not be deemed a Qualified Financing
regardless of the amount of such proceeds. 
 11. Miscellaneous. This letter, along with the Confidentiality and Non-competition Agreement,
constitutes the terms and conditions of your employment with Aldexa. It supersedes any prior agreements (other than the Confidentiality and Non-competition Agreement), or other promises or statements (whether oral or written) regarding the offered
terms of employment. The terms of your employment shall continue to be governed by the laws of the Commonwealth of Massachusetts. By accepting this letter, you agree that any controversy, dispute or claim arising out of any aspect of your employment
with Aldexa, or any separation of employment (whether voluntary or involuntary) from Aldexa (other than a controversy, dispute or claim arising under paragraph 6 which, at the election of Aldexa, may be resolved in a court of competent jurisdiction
in the Commonwealth of Massachusetts by a judge alone, you having hereby waived and renounced your right, if any, to a trial before a civil jury), shall be settled by final and binding arbitration to be conducted in the Commonwealth of Massachusetts
pursuant to the national rules of the American Arbitration Association then in effect for the resolution of employment disputes. 

  
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 Please indicate acceptance of these updated terms of employment and the other terms and
conditions hereof by signing, dating and enclosing the enclosed additional copy of this letter on or before the close of business on August 1, 2013. Your signature on the copy of this letter and your submission of the signed copy to me will
evidence your agreement with the terms and conditions set forth herein. 
 We look forward to your continued service to Aldexa as we develop
treatments for unmet medical needs. 
  

			
	Very truly yours,
	
	ALDEXA THERAPEUTICS, INC.
		
	By:	 	 /s/ Todd C. Brady

	
	Todd C. Brady
	
	President and Chief Executive Officer

  

	
	Agreed to and Acknowledged:
	
	 /s/ Scott L. Young

	
	Scott L. Young
	
	 July 15, 2013

	Date

  
 5EX-10.4

 Exhibit 10.4 

 

					
	 

	 		  	  
  
  

Aldexa Therapeutics
 15 New England
Executive Park
 Burlington, MA 01803

 November 29, 2013 
 Todd Brady, M.D. 
 15 New England Executive Park 

Burlington, MA 01803 
 Dear Dr. Brady:

 Aldexa Therapeutics, Inc. (the “Company”) is pleased to offer you employment on the following terms,
effective as of the effective date of the registration statement filed by the Company with the Securities and Exchange Commission pursuant to Form S-1 and contingent on such registration statement becoming effective: 

1. Position. Your initial title will continue to be Chief Executive Officer, and you will initially report to the
Company’s Board of Directors. This is a full-time position. While you render services to the Company, you will not engage in any other employment, consulting or other business activity (whether full-time
or part-time) that would create a conflict of interest with the Company. By signing this letter agreement, you confirm to the Company that you have no contractual commitments or other legal obligations that would prohibit you from performing your
duties for the Company. 
 2. Cash Compensation. The Company will pay you a starting salary
at the rate of $400,000 per year, payable in accordance with the Company’s standard payroll schedule. This salary will be subject to adjustment pursuant to the Company’s employee compensation policies in effect from time to time. In
addition, you will be eligible to be considered for an incentive bonus for each fiscal year of the Company. The bonus (if any) will be awarded based on objective or subjective criteria established by the Company’s Chief Executive Officer and
approved by the Company’s Board of Directors or its compensation committee. Your target bonus will be equal to 45% of your annual base salary. Any bonus for the fiscal year in which your employment begins will be prorated, based on the number
of days you are employed by the Company during that fiscal year. Any bonus for a fiscal year will be paid within 2 1/2 months after the close of that fiscal year, but only if you are still employed by the Company at the time of
payment (except as described in Section 5 below). The determinations of the Company’s Board of Directors or its compensation committee with respect to your bonus will be final and binding. 

3. Employee Benefits. As a regular employee of the Company, you will be eligible to participate in a number of
Company-sponsored benefits. In addition, you will be entitled to paid vacation in accordance with the Company’s vacation policy, as in effect from time to time. Such policy currently provides for four weeks of vacation annually.

 Todd Brady, M.D. 
 November 29, 2013 
  Page
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 4. Equity. If the Company is subject to a Change in Control before your service
with the Company terminates, then on the first permissible trading date that occurs on or following the date of such Change in Control, all of the Equity held by you as of the Change in Control date will become fully vested, exercisable and
transferable (except for transfer restrictions imposed by law); provided, however, that if required to avoid adverse consequences under Section 409A of the Code, the settlement date(s) applicable to any Equity the vesting of which is
accelerated pursuant to this Section 4 will be the date(s) specified under the agreement evidencing such Equity. Other than as described in this letter agreement, your existing Equity remains subject to the terms of the agreement evidencing
each such award and to the plan pursuant to which such Equity was granted. 
 5. Severance Benefits. 

(a) General. If you are subject to an Involuntary Termination, then you will be entitled to the benefits described in this
Section 5. However, this Section 5 will not apply unless you (i) have returned all Company property in your possession, (ii) have resigned as a member of the Boards of Directors of the Company and all of its subsidiaries, to the
extent applicable, and (iii) have executed a general release of all claims that you may have against the Company or persons affiliated with the Company. The release must be in the form prescribed by the Company, without alterations. You must
execute and return the release on or before the date specified by the Company in the prescribed form (the “Release Deadline”). The Release Deadline will in no event be later than 50 days after your Separation. If you fail to return
the release on or before the Release Deadline, or if you revoke the release, then you will not be entitled to the benefits described in this Section 5. 
 (b) Salary Continuation. If you are subject to an Involuntary Termination, then the Company will continue to pay your base salary for a period of 12 months after your Separation. Your base
salary will be paid at the rate in effect at the time of your Separation and in accordance with the Company’s standard payroll procedures. The salary continuation payments will commence within 60 days after your Separation and, once they
commence, will include any unpaid amounts accrued from the date of your Separation. However, if the 60-day period described in the preceding sentence spans two calendar years, then the payments will in any event begin in the second calendar year.

 (c) Cash Bonus. If you are subject to an Involuntary Termination, then the Company will pay you a lump-sum
in cash equal to the greater of (i) your target bonus for the year in which the Involuntary Termination occurs or (ii) the actual bonus paid to you with respect to the Company’s most recently completed fiscal year. Such payment will
be made within 60 days after your Separation; however, if such 60-day period spans two calendar years, then the payment will in any event be made in the second calendar year. 

(d) COBRA. If you are subject to an Involuntary Termination and you elect to continue your health insurance coverage under
the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following your Separation, then the Company will pay the same portion of your monthly premium under COBRA as it pays for active employees and their eligible dependents
until the earliest of (i) the close of the 12-month period following your 

 Todd Brady, M.D. 
 November 29, 2013 
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Separation, (ii) the expiration of your continuation coverage under COBRA or (iii) the date when you become eligible for substantially equivalent health insurance coverage in
connection with new employment or self-employment. Such payments will be treated as taxable compensation income to you if required or advisable, in the Company’s sole discretion, to avoid adverse consequences to you, the Company or the
Company’s other employees. 
 (e) Accelerated Vesting. If you are subject to an Involuntary
Termination, then on the first permissible trading date that occurs on or following your Separation, all of the Equity held by you as of the Separation date will become fully vested, exercisable and transferable (except for transfer restrictions
imposed by law); provided, however, that if required to avoid adverse consequences under Section 409A of the Code, the settlement date(s) applicable to any Equity the vesting of which is accelerated pursuant to this Subsection
(e) will be the date(s) specified under the agreement evidencing such Equity. In addition, if you are subject to an Involuntary Termination, any then-outstanding options to purchase shares of the Company’s Common Stock or share
appreciation rights with respect to the Company’s Common Stock shall remain outstanding and exercisable for up to 12 months following your Separation (subject to earlier expiration in the event of certain corporate transactions as described in
the stock plan governing such award and in any event provided that the award shall expire no later than the expiration date set forth in the award agreement). You acknowledge and agree that as a result of the extension of the exercisability of any
options granted to you prior to the date of this letter agreement, any such options will cease to qualify as incentive stock options under Section 422(b) of the Code, to the extent such options originally so qualified or were intended to so
qualify. 
 6. Confidentiality and Non-Competition Agreement. Like all Company employees, you remain
subject to your Confidentiality and Non-Competition Agreement with the Company, a copy of which is attached hereto as Exhibit A. 
 7. Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the Company will be “at will,” meaning that either you or the
Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations that may have been made to you are superseded by this letter agreement. This is the full and complete agreement between you and
the Company on this term. Although your job duties, title, compensation and benefits, as well as the Company’s personnel policies and procedures, may change from time to time, the “at will” nature of your employment may only be
changed in an express written agreement signed by you and a duly authorized officer of the Company (other than you). 

8. Tax Matters. 
 (a) Withholding. All forms of compensation referred to in this letter agreement are subject to reduction to reflect applicable withholding and payroll taxes and other deductions required by
law. 
 (b) Section 409A. For purposes of Section 409A of the Code, each payment under
Section 5 is hereby designated as a separate payment. If the Company determines that you are a “specified employee” under Section 409A(a)(2)(B)(i) of the Code at the time of your

 Todd Brady, M.D. 
 November 29, 2013 
  Page
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Separation, then (i) the payments under Section 5, to the extent that they are subject to Section 409A of the Code, will commence on the first business day following the
earlier of (A) expiration of the six-month period measured from your Separation or (B) the date of your death and (ii) the installments that otherwise would have been paid prior to such date will be paid in a lump sum when the salary
continuation payments commence. 
 (c) Tax Advice. You are encouraged to obtain your own tax advice
regarding your compensation from the Company. You agree that the Company does not have a duty to design its compensation policies in a manner that minimizes your tax liabilities, and you will not make any claim against the Company, its Board of
Directors or its compensation committee related to tax liabilities arising from your compensation. 
 9.
Interpretation, Amendment and Enforcement. This letter agreement and Exhibit A supersede and replace any prior agreements, representations or understandings (whether written, oral, implied or otherwise) between you and the Company
(including without limitation that certain letter agreement between you and the Company dated August 1, 2013) and constitute the complete agreement between you and the Company regarding the subject matter set forth herein. This letter agreement
may not be amended or modified, except by an express written agreement signed by both you and a duly authorized officer of the Company. The terms of this letter agreement and the resolution of any disputes as to the meaning, effect, performance or
validity of this letter agreement or arising out of, related to, or in any way connected with, this letter agreement, your employment with the Company or any other relationship between you and the Company (the “Disputes”) will be
governed by Massachusetts law, excluding laws relating to conflicts or choice of law. You and the Company submit to the exclusive personal jurisdiction of the federal and state courts located in the Commonwealth of Massachusetts in connection with
any Dispute or any claim related to any Dispute. 
 10. Definitions. The following terms have the meaning set
forth below wherever they are used in this letter agreement: 
 “Cause” means (a) your unauthorized
use or disclosure of the Company’s confidential information or trade secrets, which use or disclosure causes material harm to the Company, (b) your material breach of any agreement between you and the Company, (c) your material
failure to comply with the Company’s written policies or rules, (d) your conviction of, or your plea of “guilty” or “no contest” to, a felony under the laws of the United States or any State, (e) your gross
negligence or willful misconduct, (f) your continuing failure to perform assigned duties after receiving written notification of the failure from the Company’s Board of Directors or (g) your failure to cooperate in good faith with a
governmental or internal investigation of the Company or its directors, officers or employees, if the Company has requested your cooperation. 
 “Change in Control” means (a) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the total voting power
represented by the Company’s then-outstanding voting securities; (b) the  

 Todd Brady, M.D. 
 November 29, 2013 
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consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets; (c) the consummation of a merger or consolidation of the Company with or
into any other entity, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or its parent) more than fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger or
consolidation; or (d) individuals who are members of the Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least a majority of the members of the Board of Directors over a period of 12 months;
provided, however, that if the appointment or election (or nomination for election) of any new member of the Board of Directors was approved or recommended by a majority vote of the members of the Incumbent Board then still in office, such new
member shall, for purposes of this Agreement, be considered as a member of the Incumbent Board. A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a
holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction. In addition, if a Change in Control constitutes a payment event with respect to any
Equity or other benefit that provides for a deferral of compensation and which is subject to Section 409A of the Code, then notwithstanding anything to the contrary in this letter agreement or in any document governing such award, the
transaction with respect to such Equity or other benefit must also constitute a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5) to the extent required by Section 409A of the Code.

 “Code” means the Internal Revenue Code of 1986, as amended. 

“Equity” means (a) all shares of the Company’s Common Stock; (b) all options and other rights to purchase
shares of the Company’s Common Stock; (c) all stock units, performance units or phantom shares whose value is measured by the value of shares of the Company’s Common Stock; and (d) all stock appreciation rights whose value is
measured by increases in the value of shares of the Company’s Common Stock. 
 “Involuntary Termination”
means either (a) your Termination Without Cause or (b) your Resignation for Good Reason. 
 “Resignation for
Good Reason” means a Separation as a result of your resignation within 12 months after one of the following conditions has come into existence without your consent: 

(a) A reduction in your base salary or target bonus by more than 10%; 

(b) A material diminution of your authority, duties or responsibilities; or 

(c) A relocation of your principal workplace by more than 50 miles. 

 Todd Brady, M.D. 
 November 29, 2013 
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 A Resignation for Good Reason will not be deemed to have occurred unless you give the Company written
notice of the condition within 90 days after the condition comes into existence and the Company fails to remedy the condition within 30 days after receiving your written notice. 

“Separation” means a “separation from service,” as defined in the regulations under Section 409A of the
Code. 
 “Termination Without Cause” means a Separation as a result of a termination of your employment by the
Company without Cause, provided you are willing and able to continue performing services within the meaning of Treasury Regulation 1.409A-1(n)(1). 

 Todd Brady, M.D. 
 November 29, 2013 
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 * * * * * 
 You may indicate your agreement with these terms and accept this offer by signing and dating the enclosed duplicate original of this letter agreement and returning it to me. If you have any questions,
please call me. 
  

			
	Very truly yours,
	
	ALDEXA THERAPEUTICS, INC.
		
	By:	 	 /s/ Gary Phillips, M.D.

		
	Title:	 	 Chair, Compensation Comittee

 I have read and accept this employment offer: 

 

			
	 /s/ Todd C. Brady

	Signature of Todd Brady, M.D.
		
	Dated:	 	 November 29, 2013

 Attachment 
 Exhibit A: Confidentiality and Non-Competition Agreement

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