Document:

EX-10.3

 Exhibit 10.3 

EMPLOYMENT AGREEMENT 
  

 
 This Employment Agreement (“the
Agreement”), dated MAY 1, 2017, is between Krystal Biotech, Inc., a Delaware corporation] (the “Company”) and SUMA M KRISHNAN, (“Employee”). 
  

	1.	POSITION AND RESPONSIBILITIES 

 a. Position. Employee is employed by the Company
to render services to the Company in the position of CHIEF OPERATING OFFICER. Employee shall perform such duties and responsibilities as are normally related to such position 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. 

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.	COMPENSATION AND BENEFITS 

 a. Base Salary. In consideration of the services to be
rendered under this Agreement, the Company shall pay Employee a salary at the rate of SIXTY THOUSAND DOLLARS ($60,000) per year (“Base Salary”). The Base Salary shall be paid in accordance with the Company’s regularly established
payroll practice. Employee’s Base Salary will be reviewed 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. 
 b. 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 in the Company’s sole discretion. 
  

 

 c. 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 expense reimbursement guidelines. 
  

	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. 
  

	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. 
  

	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. 
  

 

  
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 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. 

 

	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. 

 
  

  
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 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.

  

	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. 

350 Rhode Island Street, Suite # 240 
 San Francisco, CA, 94103.

 Employee’s Notice Address: 
 2473 Clay Street, 

San Francisco, CA, 94115. 
  

	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. 
  
  

  
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	11.	TAXES 

 All amounts paid under this Agreement (including without limitation Base Salary) shall be paid
less all applicable state and federal tax withholdings and any other withholdings required by any applicable jurisdiction or authorized by Employee. 
  

	12.	GOVERNING LAW 

 This Agreement shall be governed by and construed in accordance with the laws of the
State of California. 
  

	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 

 
  

  
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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 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 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.	  		  	[EMPLOYEE]:
				
	By:	  	             /s/ Krish Krishnan
	  		  	             /s/ Suma Krishnan

		  	                    Name	  		  	                    Suma Krishnan (May 7, 2017)
				
	Title:	  	                 CEO
	  		  	

  
  

  
 6EX-10.4

 Exhibit 10.4 

EMPLOYMENT AGREEMENT 
  

 
 This Employment Agreement (“the
Agreement”), dated May 1, 2017, is between Krystal Biotech, Inc., a Delaware corporation] (the “Company”) and POOJA AGARWAL, (“Employee”), and reflects the Company’s and Employee’s desire to establish a full
employment relationship following Employee’s service to Krystal Biotech, LLC, a predecessor of the Company. 
  

	1.	POSITION AND RESPONSIBILITIES 

 a. Position. Employee is employed by the Company
to render services to the Company in the position of VICE PRESIDENT, PRODUCT DEVELOPMENT. Employee shall perform such duties and responsibilities as are normally related to such position 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. 

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.	COMPENSATION AND BENEFITS 

 a. Base Salary. In consideration of the services to be
rendered under this Agreement, the Company shall pay Employee a salary at the rate of ONE HUNDRED AND SIXTY FIVE THOUSAND Dollars ($165,000) per year (“Base Salary”). The Base Salary shall be paid in accordance with the Company’s
regularly established payroll practice. Employee’s Base Salary will be reviewed 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. 
  
  

 b. Stock Options. The Company shall recommend to the Board of Directors that Employee be
provided with an option to purchase 2000 shares of the Common Stock of the Company. This recommendation will be considered for approval at the Company’s next Board of Directors’ meeting. The price per share of any approved options will be
determined at that meeting. Employee’s entitlement to any stock options that may be approved is conditioned upon Employee’s signing of an appropriate Equity Incentive Agreement and is subject to its terms and the terms of the Equity
Incentive Plan under which the options are granted, including vesting requirements. 
 c. 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 in the Company’s sole discretion. 

d. 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 expense reimbursement guidelines. 
  

	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. 
  

	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. 
  
  

  
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	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; NONCOMPETITION 

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. 
  

 

  
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 c. Noncompetition. In consideration of the Company’s extension to Employee of full
time employment with the Company, Employee agrees that, at no time during Employee’s employment with the Company, and for a period of one (1) ) year immediately following the termination of such employment (regardless of the reason for or the
party initiating the termination), Employee will not, directly or indirectly, on 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 Employee’s 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. 

 
  

  
 4 

	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. 

350 Rhode Island Street, Suite # 240 
 San Francisco, CA, 94103.

 Employee’s Notice Address: 
 19338 Ranworth Dr,
Germantown MD 20874. 
  

	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 (including without limitation Base Salary) shall be paid
less all applicable state and federal tax withholdings and any other withholdings required by any applicable jurisdiction or authorized by Employee. 
  

 

  
 5 

	12.	GOVERNING LAW 

 This Agreement shall be governed by and construed in accordance with the laws of the
State of 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 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. 

 
  

  
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	17.	EMPLOYEE ACKNOWLEDGEMENT 

 Employee acknowledges 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.	 		  	[EMPLOYEE]:
				
	By:	 	
                    /s/
Krish Krishnan
	 		  	         /s/ Pooja Agarwal

		 	Name	 		  	
				
	Title:	 	 CEO
	 		  	

  
  

  
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