SCHEDULE: Framework Ventures Boosts NovaBay Stake to 45.1%

Framework Ventures IV L.P. and its affiliates have increased their beneficial ownership in NovaBay Pharmaceuticals, Inc. to 45.1% through convertible preferred stock and a pre-funded warrant.

Summary

• Framework Ventures IV L.P. and its affiliated entities (Framework Ventures Management LLC, Framework Ventures IV GP LLC, Vance Spencer, and Michael Ernest Anderson) collectively beneficially own 56,806,080 shares of NovaBay Pharmaceuticals, Inc. common stock.
• This represents approximately 45.1% of the company's outstanding common stock.
• The ownership is comprised of 220,663 shares of Series D Non-Voting Convertible Preferred Stock, convertible into a maximum of 35,306,080 common shares, and 134,375 shares of Series E Non-Voting Convertible Preferred Stock, convertible into a maximum of 21,500,000 common shares.
• The convertibility of the Series D Preferred Stock was approved by stockholders at a recent meeting.
• The Series E Preferred Stock was newly issued to the Reporting Persons.
• Reporting Persons also entered into a pre-funded warrant contract on October 15, 2025, to purchase 2,702,703 shares of common stock.
• This warrant is not exercisable until January 1, 2026, and full exercisability is contingent on stockholder approval for the underlying shares.

Sentiment

Score: 7

Explanation: The substantial increase in Framework Ventures' beneficial ownership to 45.1% through convertible preferred stock and a pre-funded warrant demonstrates strong investor confidence and a significant commitment to NovaBay. This influx of capital and strategic positioning by a major investor is generally viewed positively, suggesting potential for future growth and stability.

Positives

• Significant increase in beneficial ownership by a major investor, indicating strong conviction in NovaBay's future.
• Stockholder approval for the convertibility of Series D Preferred Stock, streamlining the conversion process.
• Issuance of Series E Preferred Stock and a pre-funded warrant suggests ongoing investment and potential capital infusion for NovaBay.

Risks

• The pre-funded warrant is not exercisable until January 1, 2026, and its full exercisability is subject to future stockholder approval, introducing a contingency.

Future Outlook

The pre-funded warrant, allowing the purchase of 2,702,703 common shares, is not exercisable until January 1, 2026, and its full exercisability is subject to future stockholder approval.

Industry Context

This filing primarily details a significant change in beneficial ownership for NovaBay Pharmaceuticals. While it doesn't provide broad industry trends, a substantial increase in a single investor's stake, especially through convertible preferred stock and warrants, often signals a strategic investment or a belief in the company's long-term potential within its specific pharmaceutical niche. Such moves can be seen as a vote of confidence, potentially attracting further investor interest or signaling a shift in corporate control dynamics.

Corporate Governance

Related Party Transactions

• Framework Ventures IV L.P. and its affiliates are significant beneficial owners (45.1%) and have engaged in transactions with NovaBay Pharmaceuticals, Inc. involving the purchase of Series D and Series E Non-Voting Convertible Preferred Stock and a pre-funded warrant.

Stakeholder Impact

• Shareholders: Existing common shareholders will experience significant dilution upon conversion of the preferred stock and exercise of the warrant, as Framework Ventures' stake increases to 45.1%. This could also be seen as a positive signal of strong institutional backing.
• Company (NovaBay): Benefits from the capital infusion associated with the preferred stock issuance and warrant, potentially strengthening its financial position and strategic flexibility.

Next Steps

• Stockholder approval for the full exercisability of the pre-funded warrant.
• Warrant becomes exercisable starting January 1, 2026.

Key Dates

Recommendation

While the significant increase in a major investor's stake to 45.1% through convertible preferred stock and warrants signals strong confidence and potential for future capital, the immediate impact on existing common shareholders includes substantial potential dilution. The long-term implications of such a large concentrated ownership, while potentially stabilizing, also warrant careful observation regarding corporate control and strategic direction. Therefore, a "hold" recommendation is appropriate to assess how this increased stake translates into operational performance and shareholder value over time, especially considering the future exercisability of the warrant and its contingent stockholder approval.

Keywords

NovaBay Pharmaceuticals, Framework Ventures, SEC filing, Schedule 13D, beneficial ownership, convertible preferred stock, Series D, Series E, pre-funded warrant, common stock, equity stake, investment