Yarrow Bioscience, Inc. 10-K

ITEM 9A - CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures We maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the company’s management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act and regulations promulgated thereunder) as of December 31, 2022. Based on such evaluation, those officers have concluded that, as of December 31, 2022, our disclosure controls and procedures were effective at the reasonable assurance level. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting that occurred during the fourth quarter ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, the Company’s executive and financial officers and effected by the Company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes and includes those policies and procedures that (a) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our management assessed the effectiveness of our internal control over financial reporting, as of December 31, 2022. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013). Based on our assessment, management concluded that, as of December 31, 2022, our internal control over financial reporting was effective based on these criteria. ITEM 9B - OTHER INFORMATION On March 9, 2023, the compensation committee (the "Compensation Committee") of our board of directors approved cash retention payments for the ten employees remaining at the Company as of the date of this report. In making its decision, the Compensation Committee considered (i) the limited number of employees remaining at the Company and the increase in each employee's responsibilities; (ii) the impact of the loss of any employee, especially members of management, on our ability to 72 Table of Contents execute corporate objectives for 2023; and (iii) the limited number of shares available under our existing equity incentive plans following our 1-for-18 reverse stock split. After considering the foregoing, the Compensation Committee approved a cash retention plan with the goal of encouraging the retention of employees through milestone events in 2023. Each of our employees, including David Domzalski, our President and Chief Executive Officer, Tyler Zeronda, our Chief Financial Officer, Iain Stuart, our Chief Scientific Officer, and Mutya Harsch, our General Counsel and Chief Legal Officer, is eligible to receive 100% of their target annual bonus (the "Retention Payment") over a period of time to maintain the continuity of business operations. Per the approved plan, one-third of the Retention Payment will be paid only upon the achievement of each of the following milestones, subject to the individual's remaining in our continuous service through each payment date: (i) the receipt of positive results from our Phase 1b clinical trial for VYN201; and (ii) the achievement of certain financing objectives. The remaining one-third of the Retention Payment will be paid if the employee has remained in our continuous service through December 31, 2023. Notwithstanding the foregoing, any then-unpaid portion of the Retention Payment will be paid if an employee experiences a termination of employment in connection with a change of control. ITEM 9C - DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. PART III ITEM 10 - DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Executive Officers and Directors The following table sets forth information regarding our executive officers and members of our Board of Directors (the "Board") as of December 31, 2022: Name Age Position(s) Executive Officers and Employee Director David Domzalski 56 President, Chief Executive Officer and Director Tyler Zeronda 37 Chief Financial Officer and Treasurer Iain Stuart, Ph.D. 50 Chief Scientific Officer Mutya Harsch 48 Chief Legal Officer, General Counsel and Secretary Non-Employee Directors Sharon Barbari 68 Director Steven Basta 57 Director Anthony Bruno 66 Director Patrick LePore 67 Lead Independent Director Elisabeth Sandoval 61 Director Executive Officers David Domzalski has served as the Company’s President and Chief Executive Officer and as a director since March 9, 2020, the closing date of the merger between Menlo and Foamix (the "Closing Date"). From July 2017 until the Closing Date, Mr. Domzalski served as the Chief Executive Officer of Foamix. He also served as a director of Foamix beginning in January 2018. Mr. Domzalski’s tenure with Foamix began in April 2014 when he served as President of its U.S. subsidiary. Prior to that, Mr. Domzalski was the Vice President of Sales and Marketing at LEO Pharma Inc. from 2009 to 2013. Mr. Domzalski holds a B.A. in economics and political science from Muhlenberg College in Allentown, Pennsylvania. We believe Mr. Domzalski is qualified to serve on our Board given his leadership position with the Company and Foamix, and his extensive experience in operating and leadership roles in the pharmaceutical industry. Tyler Zeronda was appointed as the Company’s Chief Financial Officer and Treasurer in March 2022 and previously served as Interim Chief Financial Officer and Treasurer since June 2021. Mr. Zeronda previously served as Vice President of Finance of the Company from the Closing Date until his appointment as Interim CFO. Mr. Zeronda joined Foamix in April 2019 and has 73 Table of Contents been responsible for all finance activities related to the commercial operations, financial planning, treasury, risk management and supply chain matters of VYNE. From April 2013 until April 2019, Mr. Zeronda held positions of increasing responsibility in finance at Aerie Pharmaceuticals Inc. (“Aerie”), a Nasdaq listed company, culminating in his role as Director of Finance. While at Aerie, Mr. Zeronda supported the company's IPO and helped lead his department’s growth and transition from that of a pre-IPO, development-stage entity to a fully integrated commercial finance organization supporting the launch of multiple drugs. Prior to joining Aerie, Mr. Zeronda was employed at Ernst & Young, LLP where he focused on assurance services in the healthcare industry. Mr. Zeronda received his Master of Science in accounting from the University of Virginia, holds a Bachelor of Arts in economics and business from Lafayette College and is a licensed CPA. Iain Stuart, Ph.D. has served as the Company's Chief Scientific Officer since the Closing Date. From January 2019 until the Closing Date, Dr. Stuart served as the Chief Scientific Officer of Foamix. Dr. Stuart previously served as Foamix’s Senior Vice President of Research & Development from August 2017 to January 2019 and as Vice President of Clinical Development from October 2016 to 2017. Prior to joining Foamix, Dr. Stuart held several positions, including Vice President of Medical Strategy and Scientific Affairs, at LEO Pharma, Inc. from 2008 to 2016. Dr. Stuart holds a Ph.D. from Glasgow Caledonian University in Scotland. Mutya Harsch has served as the Company’s Chief Legal Officer, General Counsel and Secretary since the Closing Date. From January 2019 until the Closing Date, Ms. Harsch served as the General Counsel and Chief Legal Officer of Foamix. She previously served as Foamix’s General Counsel and Senior Vice President of Legal Affairs from January 2018 to January 2019. In addition, Ms. Harsch has served on the board of directors of Satsuma Pharmaceuticals Inc. since October 2021. Ms. Harsch has over 20 years of legal experience, previously holding positions as Special Counsel, Mergers & Acquisitions at Cooley LLP from 2015 to 2017 and as a corporate lawyer at Davis Polk & Wardwell from 2005 to 2015. Ms. Harsch received her J.D. and B.A. from the University of California at Berkeley. Non-Employee Directors Sharon Barbari has served on our Board since the Closing Date and previously served as a director of Foamix from January 2019 until the Closing Date. Ms. Barbari previously served as Chief Financial Officer at Cytokinetics from 2004 to 2017 and as CFO at Gilead Sciences, where she served in senior financial roles from 1998 to 2002. Ms. Barbari also served as CFO and Senior Vice President of Finance and Administration at InterMune, and Vice President of Strategic Planning at Foote, Cone & Belding Healthcare. From 1972 to 1990, Ms. Barbari served in various roles of increasing responsibility at Syntex Corporation/Roche Pharmaceuticals. Ms. Barbari currently serves on the board of directors of Agile Therapeutics. She previously served on the board of directors of Foamix from January 2019 until the Closing Date, Sonoma Pharmaceuticals, Phytogen Life Sciences and the Association of Bioscience Finance Officers. In 2017, Ms. Barbari was a recipient of the YWCA Silicon Valley Tribute to Women Awards. She received her BS in accounting from San Jose State University. The Board believes that Ms. Barbari’s long career as a senior financial executive and her leadership roles in various biotechnology and pharmaceutical companies provides broad experience and knowledge of the global pharmaceutical business and industry, as well as extensive accounting expertise, to the Board and to the Company . Steven Basta served as our President and Chief Executive Officer from September 2015 until the Closing Date and has served as a member of our Board since September 2015. From December 2020 until October 2022, Mr. Basta served as the Chief Executive Officer of Mahana Therapeutics, a privately-held digital therapeutics company. From October 2011 until August 2015, Mr. Basta served as Chief Executive Officer of AlterG, a privately held medical device company. From November 2002 to February 2010, Mr. Basta served as Chief Executive Officer of BioForm Medical, a publicly listed medical aesthetics company acquired by Merz, and from February 2010 to September 2011 served as Chief Executive Officer of Merz Aesthetics, the successor to BioForm Medical. He has served on the board of DermBiont, Inc., a privately held pharmaceutical company, since March 2020. Mr. Basta previously served as a board member of Viveve Medical from September 2018 until March 2023, including as Chairman of the Board from January 2019 until March 2023. Mr. Basta also previously served on the board of Carbylan Therapeutics from September 2009 to November 2016 when it was acquired by KalVista Pharmaceuticals. Mr. Basta served on the board of RF Surgical (acquired by Medtronic) from December 2013 to August 2015. Mr. Basta received a B.A. from The Johns Hopkins University and an M.B.A. from the Kellogg Graduate School of Management at Northwestern University. We believe Mr. Basta is qualified to serve on our Board because of his extensive experience in leadership and management roles at various life sciences companies. Anthony Bruno has served on our Board since the Closing Date and previously served as a director of Foamix from November 2018 until the Closing Date. Mr. Bruno is currently retired. He previously served as a strategic consultant to Foamix from 2014 until August 2018, and to various healthcare-focused investment funds from 2011 to January 2018. He was employed at Warner Chilcott from 2000 to 2011, most recently as Executive Vice President, with responsibility for all business development activities including product acquisitions and divestitures as well as licensing agreements. Mr. Bruno also spent 16 years at Warner Lambert, holding several positions of increasing strategic responsibility. Mr. Bruno began his legal career as an 74 Table of Contents associate with Shearman & Sterling. Mr. Bruno holds a B.A. in Political Science from Syracuse University, and a J.D. from The George Washington University Law School. We believe Mr. Bruno is qualified to serve on our Board given his experience as an accomplished pharmaceutical executive with broad expertise in the legal, business development, and corporate development functions within the industry, as well as significant experience in product licensing and M&A transactions. Patrick LePore has served on our Board since September 2020 and was appointed as the lead independent director in February 2021. Mr. LePore previously served as Chairman, Chief Executive Officer and President of Par Pharmaceutical Companies, Inc. from September 2006 until its sale to affiliates of TPG Capital in 2012. He remained as chairman of Par Pharmaceutical through its sale to Endo International in 2015. Mr. LePore began his career with Hoffmann-LaRoche. He later founded Boron, LePore & Associates, a medical communications company, which he took public in 1997 and was eventually sold to Cardinal Health in 2002. Mr. LePore is currently Chairman of the Board of Lannett Co. Inc. He previously served on the boards of Matinas BioPharma, PharMerica and Innoviva, and previously served as a trustee of Villanova University. Mr. LePore earned a bachelor’s degree from Villanova University and a Master of Business Administration from Farleigh Dickinson University. We believe Mr. LePore is qualified to serve on our Board given his extensive experience as a senior level executive and board member for several companies in the pharmaceutical sector. Elisabeth Sandoval has served as a member of our Board since March 2019. Ms. Sandoval currently serves as a consultant to the pharmaceutical industry. Previously, from 2016 to 2019, she served as the Chief Commercial Officer and Executive Vice President of Corporate Strategy for Alder Biopharmaceuticals, a clinical stage company focused on developing novel therapeutic antibodies for the treatment of migraine. Prior to this, Ms. Sandoval was Chief Commercial Officer for KYTHERA Biopharmaceuticals until KYTHERA’s acquisition by Allergan. Before KYTHERA, Ms. Sandoval served as Vice President of Marketing for Bausch and Lomb Surgical and Vice President of Global Marketing at Allergan with responsibility for the Medical Aesthetics division. She spent 23 years at Allergan in sales and marketing leadership roles in the specialties of dermatology, neurology, and aesthetics. Ms. Sandoval began her career in research and development at Johnson & Johnson’s Ethicon division. Ms. Sandoval serves on the board of directors for Satsuma Pharmaceuticals and Procept BioRobotics. She holds an MBA from Pepperdine University and a B.S. in biology from the University of California, Irvine. We believe that Ms. Sandoval is qualified to serve on our Board because of her extensive background working in the dermatology industry and her experience in strategic planning, business transactions, sales operations and executive leadership. Corporate Governance Guidelines The Board has documented our governance practices in our corporate governance guidelines to assure that the Board will have the necessary authority and practices in place to review and evaluate our business operations as needed and to make decisions that are independent of our management. The guidelines are also intended to align the interests of directors and management with those of our stockholders. The corporate governance guidelines set forth certain practices the Board will follow with respect to Board composition, Board committees, Board nomination, director qualifications and evaluation of the Board and committees. The corporate governance guidelines and the charter for each committee of the Board may be viewed at http://https://vynetherapeutics.com/investors-media/corporate-goverance/. Leadership Structure of the Board Our amended and restated bylaws and corporate governance guidelines provide our Board with flexibility to designate the position of Chairman of the Board, and if so, to combine or separate the positions of Chairman of the Board and Chief Executive Officer, or to appoint a lead director in accordance with its determination that utilizing a particular structure would be in the best interests of the Company. Our Nominating and Corporate Governance Committee evaluated our leadership structure in 2021 and subsequently recommended that the Board appoint a lead independent director. Following such recommendation and a discussion by the full Board, our Board appointed Patrick LePore as lead independent director in February 2021. The Board determined that the appointment of a lead independent director is in the best interests of the Company and its stockholders as it strengthens the Board's independence and commitment to strong governance practices. Role of Board in Risk Oversight Process Risk assessment and oversight are an integral part of our governance and management processes. Our Board encourages management to promote a culture that incorporates risk management into our corporate strategy and day-to-day business operations. Management discusses strategic and operational risks at regular management meetings, and conducts specific strategic planning and review sessions during the year that include a focused discussion and analysis of the risks facing us. Throughout the year, senior management reviews these risks with the Board at regular Board meetings as part of management 75 Table of Contents presentations that focus on particular business functions, operations or strategies, and presents the steps taken by management to mitigate or eliminate such risks. Committees of the Board of Directors The Board has a standing Audit Committee, Compensation Committee and a Nominating and Corporate Governance Committee. The Board may establish other committees to facilitate the management of our business. The current composition and functions of each committee are described below. Name Audit Compensation Nominating and Corporate Governance David Domzalski — — — Sharon Barbari X* X X Steven Basta — — — Anthony Bruno — X X* Patrick LePore X — X Elisabeth Sandoval X X* — * Committee Chairperson Below is a description of each committee of the Board. Audit Committee Our Audit Committee oversees our corporate accounting and financial reporting process. Among other matters, the Audit Committee: • appoints our independent registered public accounting firm; • evaluates the independent registered public accounting firm’s qualifications, independence and performance; • determines the engagement of the independent registered public accounting firm; • reviews and approves the scope of the annual audit and the audit fee; • discusses with management and the independent registered public accounting firm the results of the annual audit and the review of our quarterly financial statements; • approves the retention of the independent registered public accounting firm to perform any proposed permissible non‑audit services; • monitors the rotation of partners of the independent registered public accounting firm on our engagement team in accordance with requirements established by the SEC; • is responsible for reviewing our financial statements and our management’s discussion and analysis of financial condition and results of operations to be included in our annual and quarterly reports to be filed with the SEC; • reviews our critical accounting policies and estimates; and • reviews the Audit Committee charter and the committee’s performance at least annually. The current members of our Audit Committee are Mses. Barbari and Sandoval and Mr. LePore, with Ms. Barbari serving as chairperson of the committee. All members of our Audit Committee meet the requirements for financial literacy under the applicable rules and regulations of the SEC and Nasdaq. Our Board has determined that Ms. Barbari is an audit committee financial expert as defined under the applicable rules of the SEC and has the requisite financial sophistication as defined under the applicable rules and regulations of Nasdaq. Under the rules of the SEC, members of the Audit Committee must also meet heightened independence standards. Our Board has determined that Mses. Barbari and Sandoval and Mr. LePore are independent under the applicable rules of the SEC and Nasdaq. 76 Table of Contents The Audit Committee operates under a written charter that satisfies the applicable standards of the rules of the SEC and Nasdaq. A copy of the Audit Committee charter is available to security holders on our website at https://vynetherapeutics.com/investors-media/corporate-goverance/. Compensation Committee Our Compensation Committee oversees policies and makes determinations relating to compensation and benefits of our current and prospective officers, directors and employees. The Compensation Committee periodically evaluates the performance of our Company, and where appropriate, our officers, in light of the goals and objectives it has established, and determines and approves, or may recommend to the Board to approve, the bonus award, if any, payable to these officers. The Compensation Committee may establish compensation and make bonus awards to our chief executive officer directly or may make recommendations to the Board regarding compensation and bonus awards payable to our chief executive officer. Our Compensation Committee also reviews director compensation and makes recommendations to the Board regarding director compensation. The Compensation Committee also reviews and approves or makes recommendations to our Board regarding the issuance of stock options and other awards under our stock plans. The Compensation Committee will periodically review and evaluate the performance of the Compensation Committee and its members, including compliance by the Compensation Committee with its charter. The current members of our Compensation Committee are Mr. Bruno and Mses. Barbari and Sandoval, with Ms. Sandoval serving as the chairperson of the committee. Our Board has determined that each of Mr. Bruno and Mses. Barbari and Sandoval is independent under the applicable rules and regulations of Nasdaq and is a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act. Our executive officers submit proposals to the Board and the Compensation Committee regarding our executive compensation. Our Chief Executive Officer also annually reviews the performance of each executive officer and makes recommendations regarding their compensation. The Compensation Committee considers those recommendations in determining base salaries, adjustments to base salaries, annual cash bonus program targets and awards and equity awards, if any, for the executive officers and other members of senior management. The Compensation Committee has evaluated the independence of its outside advisors, including outside compensation advisor and legal counsel, considering the independence factors specified in the listing requirements of Nasdaq and concluded their work for the Compensation Committee does not raise any conflicts of interest. The Compensation Committee operates under a written charter that satisfies the applicable standards of the rules of the SEC and Nasdaq. A copy of the Compensation Committee charter is available to security holders on our website at https://vynetherapeutics.com/investors-media/corporate-goverance/. Nominating and Corporate Governance Committee Our Nominating and Corporate Governance Committee is responsible for making recommendations to our Board regarding candidates for directorships and the size and composition of our Board. In addition, the Nominating and Corporate Governance Committee is responsible for overseeing our corporate governance policies and reporting and making recommendations to our Board concerning governance matters. The current members of our Nominating and Corporate Governance Committee are Messrs. Bruno and LePore and Ms. Barbari, with Mr. Bruno serving as the chairperson of the committee. Our Board has determined that each of Messrs. Bruno and LePore and Ms. Barbari is an independent director under the applicable rules and regulations of Nasdaq relating to nominating and corporate governance committee independence. The Nominating and Corporate Governance Committee operates under a written charter that satisfies the applicable standards of the SEC and Nasdaq. A copy of the Nominating and Corporate Governance Committee charter is available to security holders on our website at https://vynetherapeutics.com/investors-media/corporate-goverance/. Our Nominating and Corporate Governance Committee is responsible for reviewing with the Board, on an annual basis, the appropriate characteristics, skills and experience required for the Board as a whole and its individual members. In evaluating the suitability of individual candidates (both new candidates and current members), the Nominating and Corporate Governance Committee, in recommending candidates for election, and the Board, in approving (and, in the case of vacancies, appointing) such candidates, may take into account many factors, including but not limited to the following: 77 Table of Contents • the candidate’s experience in corporate management, such as serving as an officer or former officer of a publicly held company; • the candidate’s experience as a board member of another publicly held company; • the candidate’s professional and academic experience relevant to the Company’s industry; • the strength of the candidate’s leadership skills; • the candidate’s experience in finance and accounting and/or executive compensation practices; and • whether the candidate has the time required for preparation, participation and attendance at Board meetings and committee meetings, if applicable. Currently, our Nominating and Corporate Governance Committee and Board evaluate each individual in the context of the Board as a whole, with the objective of assembling a group that can best maximize the success of the business and represent stockholder interests through the exercise of sound judgment using its diversity of experience in these areas. The Nominating and Corporate Governance Committee will consider individuals who are properly proposed by stockholders to serve on the Board in accordance with laws and regulations established by the SEC and the Nasdaq listing requirements, our bylaws and applicable corporate law, and make recommendations to the Board regarding such individuals based on the established criteria for members of our Board. The Nominating and Corporate Governance Committee may consider in the future whether we should adopt a more formal policy regarding stockholder nominations. Stockholder Communications with the Board of Directors The Board will consider any written or electronic communication from our stockholders to the Board, a committee of the Board or any individual director. Any stockholder who wishes to communicate to the Board, a committee of the Board or any individual director should submit written or electronic communications to our corporate secretary at our principal executive offices, which shall include contact information for such stockholder. All communications from stockholders received shall be forwarded by our secretary to the Board, a committee of the Board or an individual director, as appropriate, on a periodic basis, but in any event no later than the Board’s next scheduled meeting. The Board, a committee of the Board, or individual directors, as appropriate, will consider and review carefully any communications from stockholders forwarded by our secretary. Code of Business Conduct and Ethics We have adopted a code of business conduct and ethics that applies to all of our employees, officers and directors, including those officers responsible for financial reporting. Our code of business conduct and ethics is available on our website at https://vynetherapeutics.com/investors-media/corporate-goverance/. Any amendments to the code, or any waivers of its requirements, will be disclosed on our website. The reference to our web address does not constitute incorporation by reference of the information contained at or available through our website. Prohibition on Margin Accounts and Hedging and Similar Transactions Our employees and directors are subject to an insider trading policy that, among other things, prohibits them from holding our securities in a margin account or pledging our securities as collateral for a loan. In addition, our insider trading policy prohibits employees and directors from engaging in put or call options, short selling, or similar hedging activities involving our stock. We prohibit these transactions because they may reduce the individual’s incentive to improve our performance, focus the individual on short-term performance at the expense of long-term objectives, and misalign the individual’s interests with those of our stockholders generally. ITEM 11 - EXECUTIVE COMPENSATION The following is a discussion of compensation arrangements of our named executive officers ("NEOs"). As an “emerging growth company” as defined in the JOBS Act, we have elected to comply with the scaled disclosure requirements applicable to emerging growth companies. Our NEOs for the year ended December 31, 2022 were: • David Domzalski, President and Chief Executive Officer; • Mutya Harsch, Chief Legal Officer, General Counsel and Secretary; and • Iain Stuart, Chief Scientific Officer. 78 Table of Contents Summary Compensation Table The following table sets forth the compensation information for our NEOs for the years ended December 31, 2022 and 2021. Name and Principal Position Year Salary ($) Non-equity Incentive Compensation ($)(1) Stock Awards ($)(2) Option Awards ($)(2) All Other Compensation ($)(3) Total Compensation ($) David Domzalski 2022 637,560 325,156 190,504 128,044 12,200 1,293,464 President and Chief Executive Officer 2021 637,560 242,910 1,818,861 (4) 2,141,994 (4) 11,600 4,852,925 Mutya Harsch 2022 422,172 143,538 45,750 30,750 12,200 654,410 Chief Legal Officer, General Counsel and Secretary 2021 405,936 142,007 345,587 (4) 406,976 (4) 11,600 1,312,106 Iain Stuart 2022 421,811 143,415 45,750 30,750 12,200 653,926 Chief Scientific Officer 2021 405,576 117,620 345,587 (4) 406,976 (4) 11,600 1,287,359 1. The amounts reported in this column reflect cash bonuses awarded pursuant to the achievement of our 2022 and 2021 corporate objectives. 2. Represents the grant date fair value of the restricted stock units and stock options granted by the Company to our named executive officers during 2022 and 2021as computed in accordance with ASC 718. The assumptions used in calculating the grant date fair value are set forth in Note 12 to the financial statements included in this report. 3. Reflects employer contributions to each individual's 401(k) plan. 4. For stock and option awards granted in 2021, see "—Retention Compensation" for additional discussion regarding retention awards issued in September 2021. Non-Equity Incentive Plan Compensation Mr. Domzalski's eligibility to receive his target bonus is based 100% on the achievement of corporate performance objectives. Seventy-five percent of Ms. Harsch's and Dr. Stuart's target bonus is based on the achievement of corporate performance objectives and the remaining 25% is based on the achievement of individual performance objectives. For the 2022 bonuses, these corporate performance objectives included: (i) the advancement of our biotech strategy and the development of our pipeline; (ii) the achievement of certain research and development objectives, including receiving successful results in the Phase 2a trial for FMX114, and the advancement of our BET inhibitor programs; (iii) the execution of certain business development initiatives; (iv) and the achievement of certain financial objectives (the "2022 Corporate Assessment"). Based on the 2022 Corporate Assessment, Mr. Domzalski, Ms. Harsch and Dr. Stuart were awarded the bonuses reflected in the table above, which represents 85% of each individual's 2022 target bonus. Outstanding Equity Awards at Fiscal Year End The following table sets forth all outstanding equity awards held by each of the named executive officers as of December 31, 2022. The number of shares and, where applicable, exercise price per share, in the table and narrative that follow reflect the reverse stock split the became effective on February 10, 2023. Option Awards Share Awards Name Vesting Commencement Date (1) Number of Securities Underlying Unexercised Options Exercisable Number of Securities Underlying Unexercised Options Unexercisable Option Exercise Price ($) Option Expiration Date Number of Shares or Units of Shares That Have Not Vested (#) Market Value of Shares or Units of Shares That Have Not Vested (2)($) David Domzalski 6/9/2014 468 — 319.68 6/9/2024 — — 11/10/2015 5,922 — 285.84 11/10/2025 — — 3/1/2016 1,500 — 241.92 3/1/2026 — — 2/21/2017 1,784 — 408.96 2/21/2027 — — 8/8/2017 8,195 — 230.40 8/8/2027 — — 79 Table of Contents 5/8/2018 1,755 — 203.40 5/8/2028 — — 1/1/2019 4,009 267 151.20 1/1/2029 114 308 2/24/2020 4,144 1,880 161.28 2/24/2030 805 2,174 5/6/2020 5,904 3,539 140.40 5/6/2030 3,540 9,558 2/22/2021 8,721 11,208 149.94 2/22/2031 4,803 12,968 9/2/2021 (3) 11,123 6,672 30.24 9/2/2031 17,795 48,047 3/17/2022 — 17,349 10.98 3/17/2032 17,350 46,845 Mutya Harsch 2/27/2018 1,250 — 254.16 2/27/2028 — — 1/1/2019 1,649 109 151.20 1/1/2029 46 124 2/24/2020 1,659 750 161.28 2/24/2030 320 864 5/6/2020 1,303 779 140.40 5/6/2030 780 2,106 2/22/2021 1,658 2,127 149.94 2/22/2031 910 2,457 9/2/2021 (3) 2,114 1,266 30.24 9/2/2031 3,381 9,129 3/17/2022 — 4,165 10.98 3/17/2032 4,166 11,248 Iain Stuart 11/15/2016 1,000 — 342.00 11/15/2026 — — 8/8/2017 325 — 216.00 8/8/2027 — — 2/27/2018 750 — 254.16 2/27/2028 — — 1/01/2019 1,782 118 151.20 1/1/2029 50 135 2/24/2020 1,659 750 161.28 2/24/2030 320 864 5/06/2020 979 582 140.40 5/6/2030 583 1,574 2/22/2021 1,658 2,127 149.94 2/22/2031 910 2,457 9/2/2021 (3) 2,114 1,266 30.24 9/2/2031 3,381 9,129 3/17/2022 — 4,166 10.98 3/17/2032 4,166 11,248 1. Except as set forth in footnote 3 below, these equity awards vest over a four year period, with 25% vesting on the first anniversary of the last day of the quarter in which the grant was made, and 6.25% every quarter thereafter. 2. The market value is based on the closing price of our common stock on December 31, 2022. 3. Awards granted pursuant to the Company's retention initiatives in September 2021. See "—Retention Compensation" for additional details, including vesting terms. Retention Compensation September 2021 Retention Awards In August 2021, the Company announced that it would be divesting its commercial business and transitioning to a biotech strategy focused on drug development. In connection with such decision, on September 2, 2021, the Compensation Committee approved the grant of an aggregate of 66,939 shares subject to restricted stock unit and stock option awards to all continuing employees of the Company, including members of management. The awards were issued in accordance with the terms and conditions of the Company’s 2019 Equity Incentive Plan and the 2018 Omnibus Incentive Plan and the underlying award agreements. The Compensation Committee determined such grants were appropriate to address the need to adequately retain the Company’s employees through this period of strategic change and incentivize employees to effectively execute the Company’s new strategic operating plan and closely align the interests of employees with the Company’s stockholders over the long term. Mr. Domzalski was awarded 17,795 restricted stock unit awards and employee stock options to purchase 17,795 shares. Dr. Stuart and Ms. Harsch were each awarded 3,381 restricted stock unit awards and employee stock options to purchase 3,381 shares. All of the shares subject to restricted stock unit awards will vest on September 30, 2023, and 50% of the shares subject to stock option awards vested on September 30, 2022, with the remaining 50% of the shares vesting thereafter in equal, quarterly installments through September 30, 2023, in each case, subject to the recipient’s continued service to the Company through the vesting date. The exercise price for each stock option granted is $30.24 per share, which represents the closing price for the Company’s common stock on the date of grant. 80 Table of Contents 2023 Retention Payments On March 9, 2023, the Compensation Committee approved cash retention payments for the ten employees remaining at the Company as of the date of this report. In making its decision, the Compensation Committee considered (i) the limited number of employees remaining at the company and the increase in each employee's responsibilities; (ii) the impact of the loss of any employee, especially members of management, on our ability to execute corporate objectives for 2023; and (iii) the limited number of shares available under our existing equity incentive plans following our 1-for-18 reverse stock split. After considering the foregoing, the Compensation Committee approved a cash retention plan with the goal of encouraging the retention of employees through milestone events in 2023. Each of our employees, including each of our NEOs, is eligible to receive 100% of their target annual bonus (the "Retention Payment") over a period of time to maintain the continuity of business operations. Per the approved plan, one-third of the Retention Payment will be paid only upon the achievement of each of the following milestones, subject to the individual's remaining in our continuous service through each payment date: (i) the receipt of positive results from our Phase 1b clinical trial for VYN201; and (ii) the achievement of certain financing objectives. The remaining one-third of the Retention Payment will be paid if the employee has remained in our continuous service through December 31, 2023. Notwithstanding the foregoing, any then-unpaid portion of the Retention Payment will be paid if an employee experiences a termination of employment in connection with a change of control. Compensation Arrangements with Named Executive Officers We have entered into agreements with each of our named executive officers in connection with his or her employment with us. These agreements set forth the terms and conditions of employment of each NEO, including base salary, target bonus and standard employee benefit plan participation. Our Board or the Compensation Committee reviews each NEO’s base salary and other compensation from time to time to ensure compensation adequately reflects the NEO’s qualifications, experience, role and responsibilities. The following summaries of the compensation arrangements do not purport to be complete and are qualified in their entirety by reference to each agreement. David Domzalski, President and Chief Executive Officer The terms of Mr. Domzalski’s employment are governed by his Offer Letter, dated as of March 25, 2020. Under his Offer Letter, Mr. Domzalski’s annualized base salary for 2020 was $616,000, which was increased to $637,560 in February 2021 by the Compensation Committee. Mr. Domzalski's salary remained unchanged for 2022 and will remain unchanged in 2023. Mr. Domzalski is also eligible to receive an annual cash target bonus of 60% of his base salary, up to the maximum bonus opportunity allowable under the applicable annual bonus plan or program in effect from time to time (such maximum bonus opportunity currently being 200% of the target bonus), subject to the achievement of Company performance criteria determined by the Board or the Compensation Committee. Mr. Domzalski's Offer Letter provides that if Mr. Domzalski’s employment is terminated by the Company without Cause or he resigns for Good Reason (each as defined below), then, subject to his execution and non-revocation of a release of claims, Mr. Domzalski will be entitled to receive (i) a severance payment equal to 100% of his annual base salary then in effect, (ii) payment of COBRA premiums for healthcare plan continuation at active employee rates for 12 months following the date of termination and (iii) full accelerated vesting of all of outstanding and unvested stock options and restricted stock units on the date of termination, with such stock options remaining exercisable for 90 days following the date of termination. If Mr. Domzalski’s employment is terminated by the Company without Cause or he resigns for Good Reason, in each case, within 12 months following a Change in Control (as defined in the 2019 Equity Incentive Plan), then, subject to his execution and non-revocation of a release of claims, Mr. Domzalski will be entitled to receive (i) a severance payment equal to 1.5 times the sum of his base salary and target bonus for the year of termination, (ii) a prorated target annual bonus payment for the year of termination, (iii) payment of COBRA premiums for healthcare plan continuation at active employee rates for 18 months following the date of termination and (iv) full accelerated vesting of all of outstanding and unvested stock options and restricted stock units on the date of termination, with such stock options remaining exercisable for 90 days following the date of termination. For purposes of Mr. Domzalski's Offer Letter: "Cause" means (1) the executive’s commission of an act of fraud or dishonesty in the course of his employment hereunder; (2) the executive’s indictment, conviction or entering of a plea of nolo contendere for a crime constituting a felony; (3) the executive’s gross negligence or willful misconduct in connection with his employment; (4) the executive’s willful and 81 Table of Contents continued failure to substantially perform his duties; (5) the executive’s breach of any of the restrictive covenants; or (6) a material breach of this agreement or any other agreement, plan or arrangement by and between the executive and the Company or any of its subsidiaries and affiliates or any policy of the Company or any of its subsidiaries and affiliates by the executive. "Good Reason" means (i) a material diminution in the executive’s base salary or target bonus (provided that failure to earn a bonus equal to or in excess of the target bonus by reason of failure to achieve applicable performance goals shall not be deemed Good Reason); (ii) a material diminution of the executive’s position, responsibilities, duties or authorities from those in effect as of the effective date; (iii) any change in reporting structure such that the executive is required to report to someone other than the Board; (iv) any material breach by the Company of its obligations under this agreement; or (v) a change in the executive’s primary work location that increases the executive’s commute by more than 50 miles, in each case subject to certain notice and cure periods. The Company must provide Mr. Domzalski with 30 days’ notice prior to a termination without Cause, and he must provide the Company 30 days’ notice prior to any resignation. Mutya Harsch, Chief Legal Officer, General Counsel and Secretary The terms of Ms. Harsch’s employment are governed by her Offer Letter, dated as of April 7, 2021. Ms. Harsch’s base salary for 2022 was $422,172 and will be unchanged for 2023. Ms. Harsch is also eligible to receive an annual target bonus of 40% of her annual base salary. Her eligibility for such annual target bonus, and the amount of such annual target bonus, is subject to the achievement of corporate performance goals and her achievement of performance targets and milestone criteria, as determined by the Chief Executive Officer, in accordance with our current general bonus plan. The Offer Letter provides that, in the event of a termination of her employment without Cause (as defined in the 2019 Equity Incentive Plan), subject to Ms. Harsch’s execution of a release of claims, Ms. Harsch will receive (i) a lump sum severance payment equal to 75% of her base salary then in effect and (ii) payment of COBRA premiums for healthcare plan continuation at active employee rates for nine (9) months following the date of termination, provided that the Company’s obligation under clause (ii) shall terminate on the earlier of (x) the date on which she enrolls in a group health plan offered by another employer and (y) the date on which she is no longer eligible for continuation coverage under COBRA. In addition, if Ms. Harsch's employment is terminated by the Company without Cause or she terminates her employment with Good Reason within the twelve month period after a Change of Control (as defined in the 2019 Equity Incentive Plan), she will be entitled to receive a change of control payment equal to (i) one times (1.0x) the sum of her then current base salary plus her target bonus, (ii) her pro rata target bonus for the year of termination, and (iii) payment of COBRA premiums for healthcare plan continuation at active employee rates for twelve (12) months following the date of termination, provided that the Company’s obligation under clause (iii) shall terminate on the earlier of (x) the date on which she enrolls in a group health plan offered by another employer and (y) the date on which she is no longer eligible for continuation coverage under COBRA. In addition, in the event of such a termination, all of Ms. Harsch’s unvested stock options and restricted stock units will become fully vested. For purposes of Ms. Harsch’s Offer Letter, “Good Reason” means: (i) a material reduction in base salary; (ii) a material reduction in target annual bonus opportunity; (iii) a relocation of principal place of employment by more than twenty-five (25) miles provided that such relocation increases the daily commute; or (iv) an adverse change in position, including title, reporting relationship(s), authority, duties or responsibilities; all of the above without consent., in each case subject to certain notice and cure periods. The Company must provide Ms. Harsch with 30 days’ notice prior to a termination without Cause, and she must provide the Company 30 days’ notice prior to any resignation. Ms. Harsch’s Offer Letter also contains customary confidentiality, non-competition and non-solicitation covenants. Iain Stuart, Chief Scientific Officer The terms of Dr. Stuart’s employment are governed by his Offer Letter, dated as of March 7, 2022. Dr. Stuart's base salary for 2022 was $421,811 and will be unchanged for 2023. Dr. Stuart is also eligible to receive an annual target bonus of 40% of his annual base salary. His eligibility for such annual target bonus, and the amount of such annual target bonus, is subject to his achievement of performance targets and milestone criteria, as determined by the Chief Executive Officer, in accordance with our current general bonus plan. 82 Table of Contents In the event of a termination of his employment without Cause (as defined in the 2019 Equity Incentive Plan) or if he resigns for Good Reason, subject to Dr. Stuart’s execution of a release of claims, Dr. Stuart will receive (i) a lump sum severance payment equal to 75% of his base salary then in effect and (ii) payment of COBRA premiums for healthcare plan continuation at active employee rates for nine (9) months following the date of termination, provided that the Company’s obligation under clause (ii) shall terminate on the earlier of (x) the date on which he enrolls in a group health plan offered by another employer and (y) the date on which he is no longer eligible for continuation coverage under COBRA. In addition, if Dr. Stuart's employment is terminated by the Company without Cause or if he terminates his employment with Good Reason within the twelve month period after a Change of Control, he will be entitled to receive a change of control payment equal to (i) one times (1.0x) the sum of his then current base salary plus his target bonus, (ii) his pro rata target bonus for the year of termination, and (iii) payment of COBRA premiums for healthcare plan continuation at active employee rates for twelve (12) months following the date of termination, provided that the Company’s obligation under clause (iii) shall terminate on the earlier of (x) the date on which he enrolls in a group health plan offered by another employer and (y) the date on which he is no longer eligible for continuation coverage under COBRA. In addition, in the event of such a termination, all of Dr. Stuart's unvested stock options and restricted stock units will become fully vested. For purposes of Dr. Stuart’s Offer Letter, “Good Reason” means: (i) a material reduction in base salary; (ii) a material reduction in target annual bonus opportunity; (iii) a relocation of principal place of employment by more than twenty-five (25) miles provided that such relocation increases the daily commute; or (iv) an adverse change in position, including title, reporting relationship(s), authority, duties or responsibilities; all of the above without consent, in each case subject to certain notice and cure periods. The Company must provide Dr. Stuart with 30 days’ notice prior to a termination without Cause, and he must provide the Company 30 days’ notice prior to any resignation. Dr. Stuart’s Offer Letter also contains customary confidentiality, non-competition and non-solicitation covenants. Terms and Conditions of 401(k) Plan We maintain a tax‑qualified retirement plan that provides eligible U.S. employees, including our NEOs, with an opportunity to save for retirement on a tax advantaged basis. Eligible employees are able to defer eligible compensation subject to applicable annual Internal Revenue Code (the “Code”) limits. Currently, we match each eligible employee’s contributions up to 4% of total eligible compensation. Employees’ pre‑tax contributions are allocated to each participant’s individual account and are then invested in selected investment alternatives according to the participants’ directions. Employees are immediately and fully vested in their contributions. The 401(k) plan is intended to be qualified under Section 401(a) of the Code with the 401(k) plan’s related trust intended to be tax exempt under Section 501(a) of the Code. As a tax‑qualified retirement plan, contributions to the 401(k) plan and earnings on those contributions are not taxable to the employees until distributed from the 401(k) plan. Employee Benefits and Perquisites All of our full‑time employees, including our NEOs, are eligible to participate in our health and welfare plans, including medical, dental and vision benefits, medical and dependent care flexible spending accounts, short‑term and long‑term disability insurance and life insurance. In addition, all of our employees are eligible to participate in our Employee Share Purchase Plan, which allows them to purchase shares of our common stock at a 15% discount to prevailing market prices, subject to certain terms and conditions. We do not provide our NEOs with perquisites or other personal benefits, other than the retirement, health and welfare benefits that apply uniformly to all of our employees. Director Compensation Set forth below is a summary of the compensation paid to the non-executive members of the Board during 2022. . Initial Equity Grants. Each non-employee director who joins the Board will receive, upon appointment, options to purchase 2,278 shares of our common stock, representing two times (2x) the annual grant described below. The options will vest and become exercisable as to 1/3rd of the shares on each anniversary of the date of grant, subject to the director's continued service through each applicable vesting date. Annual Retainers. Each of our non-employee directors receives an annual cash retainer of $40,000, payable quarterly. Each non-executive director who has served as a director on our Board for at least six months will be granted options to purchase 83 Table of Contents 1,138 shares of our common stock on the date of our annual meeting of stockholders. The options vest over a 12 month period in equal, monthly installments. In addition to the annual cash retainer set forth above, each of our non-employee directors receives fees for their service as a member or chair of a committee of our Board as set forth in the table below: Additional annual retainer fees for service as a member or chair of the following committees (with chair fees inclusive of fees for service as a member) Member Chair Audit Committee $ 10,000 $ 20,000 Compensation Committee $ 7,500 $ 15,000 Nominating and Corporate Governance Committee $ 5,000 $ 10,000 In addition, if a non-employee director is appointed to serve in a leadership position on the Board, such non-employee director will be entitled to receive additional annual cash compensation of $40,000 for a non-employee chair or $25,000 for a lead independent director. The exercise price per share of each option granted under this policy will be equal to the per share fair market value of our stock on the date of grant. Each such option will have a term of ten years from the date of grant, subject to earlier termination in connection with a termination of the non-employee director’s service with us. In the event of a change of control transaction, any unvested portion of an equity award granted under this policy will fully vest and become exercisable immediately prior to the effective date of such transaction, subject to the non-employee director’s continuous service with us on the effective date of such transaction. Cash retainers will be paid on a quarterly basis in arrears, pro-rated based on the days served in the applicable fiscal quarter. In addition, none of our non-employee directors shall in any event be permitted to receive cash and equity-based compensation (calculated based on grant date fair value) exceeding, in the aggregate, $500,000 in any calendar year. We also reimburse all of our non-employee directors for all reasonable and customary business expenses in accordance with company policy. Director Compensation Table The following table sets forth information for the fiscal year ended December 31, 2022 regarding the compensation awarded to, earned by or paid to our non‑executive directors. Name Fees Earned or Paid in Cash ($) Option Awards ($)(1)(2) Total Compensation ($) Sharon Barbari 72,500 4,100 76,600 Steven Basta 40,000 4,100 44,100 Anthony Bruno 57,500 4,100 61,600 Patrick LePore 80,000 4,100 84,100 Elisabeth Sandoval 65,000 4,100 69,100 (1) Represent the grant date fair value of the stock options granted by the Company to our directors during 2022 as computed in accordance with ASC 718. The assumptions used in calculating the grant date fair value are set forth in Note 12 to the financial statements included in this report. (2) Each of our non-employee directors was granted an option to purchase 1,138 shares of our common stock on August 10, 2022 at an exercise price of $5.62. As of December 31, 2022, our non-employee directors held the following equity awards: Name Shares Underlying Outstanding Options Sharon Barbari 3,409 84 Table of Contents Steven Basta 14,546 Anthony Bruno 3,215 Patrick LePore 2,903 Elisabeth Sandoval 3,840 ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS The following table sets forth information relating to the beneficial ownership of our common stock as of February 15, 2023, by: • each person, or group of affiliated persons, known by us to beneficially own more than 5% of our outstanding shares of common stock; • each of our directors; • each of our named executive officers; and • all of our current directors and executive officers as a group. The number of shares beneficially owned by each entity, person, director or executive officer is determined in accordance with the rules of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any shares over which the individual has sole or shared voting power or investment power as well as any shares that the individual has the right to acquire within 60 days after February 15, 2023 through the exercise of any stock option, warrants or other rights. Except as otherwise indicated, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares of common stock held by that person. The percentage of shares beneficially owned is computed on the basis of 3,251,872 shares of our common stock outstanding as of February 15, 2023. Shares of our common stock that a person has the right to acquire within 60 days after February 15, 2023 are deemed outstanding for purposes of computing the percentage ownership of the person holding such rights, but are not deemed outstanding for purposes of computing the percentage ownership of any other person, except with respect to the percentage ownership of all directors and executive officers as a group. Unless otherwise indicated below, the address for each beneficial owner listed is c/o VYNE Therapeutics Inc., 685 Route 202/206 N., Suite 301, Bridgewater, NJ 08807. Name of Beneficial Owner Number of Shares Owned and Nature of Beneficial Ownership Percent of Class 5% and Greater Stockholders: — — — % Named Executive Officers and Directors: David Domzalski(1) 83,017 2.5 % Mutya Harsch(2) 16,228 * Iain Stuart(3) 16,507 * Steven Basta(4) 21,357 * Sharon Barbari(5) 4,070 * Anthony Bruno(6) 4,710 * Patrick LePore(7) 5,787 * Elisabeth Sandoval(8) 3,459 * All current directors and executive officers as a group (9 persons)(9) 163,178 4.8 % * Indicates beneficial ownership of less than 1% of the total outstanding common stock. 85 Table of Contents (1) Includes 14,713 shares of common stock and 68,304 shares of common stock underlying options and restricted stock units that have vested or will vest within 60 days of February 15, 2023. (2) Includes 3,118 shares of common stock and 13,110 shares of common stock underlying options and restricted stock units that have vested or will vest within 60 days of February 15, 2023. (3) Includes 2,816 shares of common stock and 13,691 shares of common stock underlying options and restricted stock units that have vested or will vest within 60 days of February 15, 2023. (4) Consists of (i) 2,842 shares of common stock, (ii) 3,601 shares of common stock held by The Shelter Trust under the Basta Revocable Trust (the “Shelter Trust”), (iii) 1,007 shares of common stock held by the Basta Revocable Trust dated August 4, 2017 (the “Basta Trust”), and (iv) 13,907 shares of common stock underlying options that have vested or will vest within 60 days of February 15, 2023. As the trustee of each of the Shelter Trust and the Basta Trust, Mr. Basta has voting and investment power over the shares of common stock held by each of the Shelter Trust and the Basta Trust. (5) Includes 1,041 shares of common stock and 3,029 shares of common stock underlying options that have vested or will vest within 60 days of February 15, 2023. (6) Includes 1,875 shares of common stock and 2,835 shares of common stock underlying options that have vested or will vest within 60 days of February 15, 2023. (7) Includes 3,472 shares of common stock and 2,315 shares of common stock underlying options that have vested or will vest within 60 days of February 15, 2023. (8) Includes 3,459 shares of common stock underlying options that have vested or will vest within 60 days of February 15, 2023. (9) Includes 127,110 shares of common stock underlying options or restricted stock units that have vested or will vest within 60 days of February 15, 2023 . Securities Authorized for Issuance Under Equity Compensation Plans The following table contains information about our equity compensation plans as of December 31, 2022. Equity Compensation Plan Information Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights and vesting of RSUs Weighted-average exercise price of outstanding options, warrants and rights and weighted-average grant date price of RSUs Number of securities remaining available for future issuance under equity compensation plans(3) Equity compensation plans approved by security holders (1)(2) 340,912 $ 110.46 188,611 Equity compensation plans not approved by security holders — $ — — Total 340,912 $ 110.46 188,611 (1) Includes the 2018 Omnibus Incentive Plan, the 2019 Equity Incentive Plan and the 2019 Employee Share Purchase Plan (the “2019 ESPP”). (2) The 2018 Omnibus Incentive Plan contains an “evergreen” provision pursuant to which the number of shares of common stock reserved for issuance or transfer pursuant to awards under the plan shall be increased on January 1st of each year by a number equal to the least of (x) 41,666 shares, (y) four percent of the number of shares outstanding as of the last day of the immediately preceding calendar year, or (z) a lesser number of shares determined by the plan administrator. (3) Includes 8,197 shares under the 2018 Omnibus Incentive Plan, 54,433 shares under the 2019 Equity Incentive Plan and 124,012 shares available under the 2019 ESPP. As of January 1, 2023, 41,666 shares have been added to the 2018 Omnibus Inventive Plan pursuant to the terms thereof. ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Policies and Procedures for Related Party Transactions 86 Table of Contents Our Board has adopted a written related person transaction policy, setting forth the policies and procedures for the review and approval or ratification of related person transactions. This policy covers, with certain exceptions set forth in Item 404 of Regulation S-K under the Securities Act, any transaction, arrangement or relationship, or any series of similar transactions, arrangements or relationships in which we were or are to be a participant, where the amount involved exceeds $120,000 and a related person had or will have a direct or indirect material interest, including without limitation purchases of goods or services by or from the related person or entities in which the related person has a material interest, indebtedness, guarantees of indebtedness and employment by us of a related person. In reviewing and approving any such transactions, our Audit Committee considers all relevant facts and circumstances, including but not limited to whether the transaction is on terms comparable to those that could be obtained in an arm’s length transaction with an unrelated third party and the extent of the related person’s interest in the transaction. Certain Related Party Transactions The following is a description of transactions during our last fiscal year and the year preceding our last fiscal year to which we have been a party, in which the amount involved exceeds $120,000, and in which any of our directors, executive officers or beneficial owners of more than 5% of our capital stock, or an affiliate or immediate family member thereof, had or will have a direct or indirect material interest. Credit Agreement The Company was a party to the Amended and Restated Credit Agreement and Guaranty (the “Credit Agreement”), dated as of March 9, 2020, by and among the Company and its subsidiaries, the lenders party thereto and Perceptive Credit Holdings II, LP (“Perceptive”), as administrative agent for the lenders. As of August 11, 2021, the date of the prepayment of the total amount outstanding under the Credit Agreement, affiliates of Perceptive were holders of more than 5% of the Company's outstanding common stock. In connection with the prepayment of the Company's indebtedness, Perceptive received $18.3 million, representing their portion of the principal amount, interest and prepayment premium. Perceptive received an additional $1.1 million in interest payments from January 1, 2021 through July 2021. Director and Executive Officer Compensation Please see “Director Compensation” and “Executive Compensation” for information regarding the compensation of our directors and executive officers. Employment Agreements We have entered into employment agreements with our executive officers. For more information regarding these agreements, see "Item 11. Executive Compensation." Indemnification Agreements and Directors’ and Officers’ Liability Insurance We have entered into indemnification agreements with each of our directors and executive officers. These agreements require us to, among other things, indemnify each director and executive officer to the fullest extent permitted by Delaware law, including indemnification of expenses such as attorneys’ fees, judgments, penalties fines and settlement amounts incurred by the director or executive officer in any action or proceeding, including any action or proceeding by or in right of us, arising out of the person’s services as a director or executive officer. We have obtained an insurance policy that insures our directors and officers against certain liabilities, including liabilities arising under applicable securities laws. Independence of Board of Directors and its Committees Under Nasdaq listing standards, independent directors must comprise a majority of a listed company’s board of directors within a specified period of the closing of our initial public offering. In addition, the rules of Nasdaq require that, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and corporate governance committees be independent. Under the rules of Nasdaq, a director will only qualify as an “independent director” if, in the opinion of that company’s board of directors, the director does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Audit committee members must also satisfy the independence criteria set forth in Rule 10A-3 under the Exchange Act. In order to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors or any other board committee: (1) accept, 87 Table of Contents directly or indirectly, any consulting, advisory or other compensatory fee from the listed company or any of its subsidiaries; or (2) be an affiliated person of the listed company or any of its subsidiaries. We currently satisfy the audit committee independence requirements of Rule 10A-3. Additionally, compensation committee members must not have a relationship with us that is material to the director’s ability to be independent from management in connection with the duties of a compensation committee member. Our Board has undertaken a review of the independence of each director and considered whether each director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities. As a result of this review, our Board determined that each of our directors, except for Messrs. Basta and Domzalski, are an “independent director” as defined under the applicable rules and regulations of the SEC, and the listing requirements and rules of Nasdaq. In addition, the Board determined that Mr. Bright, who served as a director until his death on January 11, 2022, was independent. ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES PricewaterhouseCoopers LLP ("PwC") served as our principal independent registered public accounting firm for the year ended December 31, 2021. Baker Tilly US, LLP was appointed as our independent registered public accounting firm for the year ended December 31, 2022 in April 2022. The following table provides information regarding fees paid by us to PwC and Baker Tilly for the years ended December 31, 2022 and 2021: Fiscal year ended December 31, 2022 2021 (in thousands of U.S. dollars) Audit fees (1) $ 409 $ 1,050 All other fees — 4 Total Fees $ 409 $ 1,054 ______________________________ (1) Includes professional services rendered in connection with the audit of our annual financial statements, the review of our interim financial statements and fees for registration statements and comfort letters. Our audit committee’s specific responsibilities in carrying out its oversight of the quality and integrity of the accounting, auditing and reporting practices of the Company include the approval of audit and non-audit services to be provided by the external auditor. The audit committee pre-approves all non-audit services provided to the Company during year. 88 Table of Contents PART IV ITEM 15 - EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) Documents Filed as Part of This Report 1. Financial statements . See Index to Financial Statements under Item 8 of Part II of this Annual Report, which is incorporated herein by reference. 2. Financial statement schedules . No schedules are applicable or required, or the information is included in the consolidated financial statements or notes thereto. 3. Exhibits . See Item 15(b) below. (b) Exhibits Incorporation by Reference Exhibit Number Description Of Document Form SEC File No. Exhibit Filing Date Filed Herewith 3.1(a) Amended and Restated Certificate of Incorporation 10-K 001-38356 3.1 March 17, 2022 3.1(b) Certificate of Designation of Preferences, Rights, and Limitations of Series A Convertible Preferred Stock. 10-Q 001-38356 3.1(b) November 14, 2022 3.1(c) Certificate of Elimination of Series A Convertible Preferred Stock. 8-K 001-38356 3.1 January 17, 2023 3.2 Amended and Restated Bylaws 10-Q 001-38356 3.2 November 14, 2022 4.1 Description of Securities Registered Under Section 12 of the Securities Exchange Act of 1934 X 4.2 Second Amended and Restated Warrant, by and among VYNE Therapeutics Inc. and Perceptive Credit Holdings II, LP. 10-Q 001-38356 4.1 May 11, 2020 4.3 Second Amended and Restated Warrant, by and among VYNE Therapeutics Inc. and Orbimed Royalty & Credit Opportunities III, LP. 10-Q 001-38356 4.2 May 11, 2020 10.1†* License Agreement (Topical), dated as of August 9, 2021, by and between In4Derm Limited and VYNE Therapeutics Inc. 10-Q 001-38356 10.1 November, 10, 2021 10.2†* Evaluation and Option Agreement, dated as of April 30, 2021, by and between In4Derm Limited and VYNE Therapeutics Inc. 10-Q 001-38356 10.2 November, 10, 2021 10.2(a)* Letter Agreement, dated as of June 15, 2022, by and between Tay Therapeutics and VYNE Therapeutics Inc. 10-Q 001-38356 10.1 August 12, 2022 10.3 Controlled Equity Offering Sales Agreement SM , dated August 12, 2021, by and between VYNE Therapeutics Inc. and Cantor Fitzgerald & Co. 8-K 001-38356 1.1 August 12, 2021 89 Table of Contents 10.4# 2009 Israeli Share Option Plan. F-1/A 001-36621 10.1 September 3, 2014 10.5(a)# 2011 Stock Incentive Plan, as amended. S-1 001-38356 10.4(a) December 28, 2017 10.5(b)# Amendment to 2011 Stock Incentive Plan. S-1 001-38356 10.4(b) December 28, 2017 10.5(c)# Form of Stock Option Agreement under 2011 Stock Incentive Plan. S-1 001-38356 10.4(c) December 28, 2017 10.5(d)# Form of Immediately Exercisable Stock Option Agreement under 2011 Stock Incentive Plan. S-1 001-38356 10.4(d) December 28, 2017 10.6# 2015 Israeli Share Incentive Plan. F-3 001-36621 10.2 October 21, 2015 10.7(a)# 2018 Omnibus Incentive Plan. S-1/A 001-38356 10.5(a) January 12, 2018 10.7(b)# Form of Stock Option Grant Notice and Stock Option Agreement under the 2018 Equity Incentive Plan. S-1/A 001-38356 10.5(b) January 12, 2018 10.7(c)# Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Agreement under the 2018 Equity Incentive Plan. 10-K 001-38356 10.11(c) March 4, 2021 10.8(a)# 2019 Equity Incentive Plan. 10-Q 001-38356 10.5 May 11, 2020 10.8(b)# Form of Share Option Grant Notice and Option Agreement under the 2019 Equity Incentive Plan for U.S. and Israeli Employees. 10-Q 001-38356 10.8 May 11, 2020 10.8(c)# Form of Restricted Share Unit Grant Notice and Restricted Share Unit Award Agreement under the 2019 Equity Incentive Plan for U.S. and Israeli Employees. 10-Q 001-38356 10.9 May 11, 2020 10.9# 2019 Employee Share Purchase Plan. 10-Q 001-38356 10.10 May 11, 2020 10.10# Offer Letter, dated as of March 25, 2020, by and between VYNE Pharmaceuticals Inc. and David Domzalski 10-Q 001-38356 10.13 May 11, 2020 10.11# Offer Letter, dated as of April 7, 2021, by and between VYNE Pharmaceuticals Inc. and Mutya Harsch. 10-Q 001-38356 10.2 May 6, 2021 10.12# Offer Letter, dated as of March 7, 2022, by and between VYNE Pharmaceuticals Inc. and Iain Stuart. 10-K 001-38356 10.12 March 17, 2022 10.13# Offer Letter, dated as of March 15, 2022, by and between VYNE Pharmaceuticals Inc. and Tyler Zeronda 10-K 001-38356 10.13 March 17, 2022 10.14 Purchase Agreement, dated as of March 15, 2022, by and between VYNE Therapeutics Inc. and Lincoln Park Capital Fund, LLC. 8-K 001-38356 10.1 March 15, 2022 90 Table of Contents 10.15 Registration Rights Agreement, dated as of March 15, 2022, by and between VYNE Therapeutics Inc. and Lincoln Park Capital Funds, LLC. 8-K 001-38356 10.2 March 15, 2022 16.1 Letter from PricewaterhouseCoopers LLP, dated April 6, 2022. 8-K 001-38356 16.1 April 7, 2022 21.1 List of Subsidiaries of VYNE Therapeutics Inc. X 23.1 Consent of independent registered public accounting firm. X 23.2 Consent of former independent registered public accounting firm. X 31.1 Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 31.2 Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 32.1** Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 32.2** Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. X 101.SCH XBRL Taxonomy Extension Schema Document X 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document X 101.DEF XBRL Taxonomy Extension Definition Document X 101.LAB XBRL Taxonomy Extension Label Document X 101.PRE XBRL Taxonomy Presentation Linkbase Document X 104 Cover Page Interactive Data Filed (embedded within the XBRL document) * Exhibits and schedules omitted pursuant to Item 601(a)(5) of Regulation S-K. † Portions of this exhibit have been omitted in accordance with Item 601(b)(10)(iv) of Regulation S-K. # Indicates management contract or compensatory plan. ** These certifications are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing. The agreements and other documents filed as exhibits to this Annual Report on Form 10-K are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or 91 Table of Contents other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time. ITEM 16 - FORM 10-K SUMMARY None. 92 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: March 14, 2023 VYNE Therapeutics Inc. By: /s/ David Domzalski David Domzalski Chief Executive Officer KNOW ALL MEN AND WOMEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints David Domzalski and Tyler Zeronda, and each of them, his or her attorney-in-fact and agent, each with the power of substitution, for him or her in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith, with the U.S. Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys-in-fact, or his or her or their substitute or substitutes, may do or cause to be done by virtue thereof. Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Signature Title Date /s/ David Domzalski Director and Chief Executive Officer ( Principal Executive Officer ) March 14, 2023 David Domzalski /s/ Tyler Zeronda Chief Financial Officer ( Principal Financial Officer and Principal Accounting Officer ) March 14, 2023 Tyler Zeronda /s/ Sharon Barbari Director March 14, 2023 Sharon Barbari /s/ Steven Basta Director March 14, 2023 Steven Basta /s/ Anthony Bruno Director March 14, 2023 Anthony Bruno /s/ Patrick LePore Director March 14, 2023 Patrick LePore /s/ Elisabeth Sandoval Director March 14, 2023 Elisabeth Sandoval 93