SCHEDULE: 5AM Partners II Establishes New Stock Sale Plan for Skye Bioscience

5AM Partners II, a significant shareholder in Skye Bioscience, Inc., has adopted a new 10b5-1 plan to sell up to 1.51 million shares of common stock between January and November 2026.

Summary

• 5AM Partners II, LLC, on behalf of 5AM Ventures II, L.P. and 5AM Co-Investors II, L.P., has established a new Rule 10b5-1 stock sale plan for shares of Skye Bioscience, Inc. common stock.
• The plan authorizes Piper Sandler & Co. to sell up to an aggregate of 1,514,557 shares.
• Sales will occur during the period beginning January 11, 2026, and ending November 16, 2026.
• The shares to be sold include 1,457,064 shares from 5AM Ventures II, L.P. and 57,493 shares from 5AM Co-Investors II, L.P., to be sold on a pro rata basis.
• This new plan replaces a previous 10b5-1 plan that is set to expire on December 17, 2025.
• The plan is intended to comply with SEC Rule 10b5-1(c) and includes provisions to prevent insider trading, such as the participant not being aware of material nonpublic information at the time of adoption.

Sentiment

Score: 4

Explanation: The filing details a planned, significant insider sale by a major institutional investor. While compliant and expected for a venture capital firm, a large divestment can be perceived negatively by the market as it indicates a reduction in stake and potentially a maturing investment horizon, which could put downward pressure on the stock price.

Positives

• The establishment of a Rule 10b5-1 plan demonstrates a structured and compliant approach to insider stock sales, aiming to avoid accusations of trading on material nonpublic information.
• The plan provides transparency regarding the future selling intentions of a major institutional investor.

Negatives

• A significant planned sale of 1,514,557 shares by a major institutional investor (representing 4.7% of the outstanding shares based on 5AM Partners II's aggregate ownership) could exert downward pressure on the stock price.
• The planned divestment may be perceived by some investors as a reduction in confidence or a move towards monetizing a maturing investment by the venture capital firm.

Risks

• Market disruptions or legal/regulatory restrictions could suspend or prevent planned transactions under the 10b5-1 Plan.
• The actual sale price of the shares is subject to market conditions and the broker's discretion, which may not align with the participant's desired outcome.
• The volume of shares to be sold could impact market liquidity and share price during the sale period from January 11, 2026, to November 16, 2026.

Future Outlook

The filing outlines a pre-scheduled plan for the sale of a significant block of shares by a major institutional investor over an approximately 10-month period in 2026. This indicates a planned reduction in their stake in Skye Bioscience, Inc. as part of their investment strategy.

Management Comments

• The Participant desires to establish this Plan to sell shares of common stock (the Stock), of Skye Bioscience, Inc. (the Issuer).
• The Participant desires to engage the Broker to effect sales of shares of the Stock in accordance with this Plan.

Industry Context

Rule 10b5-1 plans are common mechanisms for insiders and large shareholders, particularly venture capital firms, to sell stock in a pre-arranged, compliant manner, mitigating concerns about insider trading. Such sales are typical as investment horizons mature and firms seek to realize returns. The size of the sale relative to the company's market capitalization and trading volume will determine its impact on the broader market perception and liquidity.

Comparison to Industry Standards

• The use of a Rule 10b5-1 plan is a standard practice for insiders and large shareholders to sell securities in a manner compliant with SEC regulations, particularly Rule 10b5-1(c), which provides an affirmative defense against insider trading allegations.
• Venture capital firms, like 5AM Partners, typically have a lifecycle for their investments, and the establishment of a stock sale plan often signals a stage where the firm is beginning to monetize its stake, which is a common strategy in the venture capital industry.
• The volume of shares to be sold (1.51 million shares) represents a notable portion of the outstanding shares (approximately 4.7% of the class based on 5AM Partners II's beneficial ownership), which is a significant amount for a single plan, though not unprecedented for large institutional investors.

Stakeholder Impact

• Shareholders: Potential for increased selling pressure on the stock due to the planned divestment of a significant block of shares by a major institutional investor. May lead to questions about the long-term confidence of large investors.
• Company (Skye Bioscience, Inc.): The company may experience increased stock volatility during the sale period. The planned nature of the sale via a 10b5-1 plan helps maintain regulatory compliance and transparency.

Next Steps

• Piper Sandler & Co. will commence selling up to 1,514,557 shares of Skye Bioscience common stock on behalf of 5AM Partners II, LLC starting January 11, 2026.
• Sales under the 10b5-1 Plan will continue until November 16, 2026, unless terminated earlier.
• The reporting persons will be responsible for making required Section 13(d) and 16 filings (e.g., Forms 4 and 5) related to the transactions.

Key Dates

Recommendation

The filing indicates a significant planned sale of shares by a major institutional investor, 5AM Partners II, through a 10b5-1 plan. While this is a compliant and often expected action for venture capital firms as their investment matures, the sale of over 1.5 million shares (representing a notable percentage of outstanding shares) could create selling pressure on the stock. Investors should "hold" to observe the market's absorption of these shares and assess any further strategic announcements from Skye Bioscience, Inc. before making a definitive buy or sell decision. The pre-scheduled nature of the sale mitigates immediate panic but warrants caution due to the potential for sustained downward pressure.

Keywords

SKYE BIOSCIENCE, SKYE, 10b5-1 Plan, Stock Sale, Insider Selling, 5AM Partners, Venture Capital, SEC Filing, Schedule 13D, Common Stock