\nTo My Fellow Stockholders:\n<\/p>\n
\nOver the past year, we have successfully transformed NovaBay from a single product company into a larger organization with three brands in three distinct market segments. We are a stronger company with established brands in the large and growing eyecare, skincare and wound care markets. Our Avenova\u00ae<\/sup>, DERMAdoctor\u00ae<\/sup> and PhaseOne\u00ae<\/sup> products all have loyal customer bases, resulting in recurring revenue and a solid foundation for growth as we execute an aggressive commercial strategy. We differentiate our products from our competitors by being scientifically developed and clinically proven<\/i>. Our high-quality products are all manufactured in the United States.\n<\/p>\n \nAs our stockholders know, on September 9, 2022, NovaBay entered into two financing transactions. I would like to acknowledge the concerns that many stockholders have shared with me about our current need to raise additional capital and effect a reverse stock split. Although we started the year with no intention of doing either of those, our situation has changed. We need additional capital to fully implement our growth strategies, such as launching new products on the QVC\u00ae<\/sup> network and expanding into the European and Chinese markets. In connection with the financing transactions, we are required to seek stockholder approval of a reverse stock split. We expect that the reverse stock split will increase the market price of our common stock so that NovaBay will be able to satisfy the continued listing requirements of the NYSE American for the foreseeable future. We also believe that a reverse stock split may improve the marketability and liquidity of our common stock and appeal to a broader range of investors and generate greater investor interest. Further, due to the number of shares of common stock underlying the securities issued, or to be issued, in connection with the financing transactions, the NYSE American rules require that we seek stockholder approval prior to the issuance of those underlying shares.\n<\/p>\n \nWe currently anticipate holding a special meeting of stockholders on November 10, 2022 to seek stockholder approvals on the proposals outlined above.\n<\/p>\n \nDespite the current need for financing, there are many reasons to be optimistic about our future. More people are using Avenova today than ever before, with more than 600 units selling on Amazon each day, representing an 18% year-over-year increase in unit sales. To support further growth, we are expanding the customer demographic for Avenova by entering into the eyelash extension market. A growing number of women are turning to eyelash extensions to enhance their appearance, driving a market that\u2019s projected to reach $2.4 billion by 2031. Yet lash extensions can attract oil, dust, dirt and debris that may shorten their lifespan, cause irritation and increase the likelihood of eye infections. Our antimicrobial formulation is clinically proven to kill infection-causing bacteria and remove the irritants on lids and lashes, and, as an added benefit, Avenova does not damage the adhesive that holds extensions in place extending lash life.\n<\/p>\n \nWe are capitalizing on the trend for beauty products to be increasingly purchased online by broadening availability of select DERMAdoctor products through two popular U.S. online retailers, Target.com<\/a> and Urbanoutfitters.com<\/a>. Brand influencers play an important role in the beauty industry and we continue to build on the enviable position of our Chief Product Officer and board-certified dermatologist Dr. Audrey Kunin as a skincare thought-leader through interviews with popular online consumer publications and guest appearances on the QVC network.\n<\/p>\n \nExpanding marketing activities to certain overseas geographies is also a key priority to driving sales growth. To that end, we recently engaged a new partner in China to manage DERMAdoctor\u2019s flagship store on Tmall.com, which is the leading business-to-consumer online retailer in China. Brand influencers and social media platforms like TikTok are particularly effective ways to attract new customers in China, and our marketing partner brings an extensive network of bloggers and influencers, as well as strong social media brand-building capabilities. We anticipate DERMAdoctor\u2019s TikTok store in China to go live in November of this year. We are also in the process of onboarding a distribution partner in the European Union, a previously untapped market for us.\n<\/p>\n \nLastly, we launched seven new products since the beginning of 2022. This includes both new Avenova and DERMAdoctor products, keeping us highly relevant in industries that are characterized by rapid change. All our new offerings reinforce our corporate positioning of formulating and selling proprietary OTC products that are effective, scientifically developed, clinically proven and gentle, while addressing common yet underserved conditions. Importantly, all of our new product creations and launch activities are efficiently managed under a low-cost model.\n<\/p>\n \nLooking forward, we still anticipate a strong end to the year. A large seasonal order from Costco for DERMAdoctor\u2019s top-selling product, Kakadu C, will increase revenue in the third and fourth quarters. We also generally expect a spike in DERMAdoctor sales during the fall, which is the seasonally strongest period for skincare products. These developments underscore our confidence for continued growth.\n<\/p>\n \nAs we gain traction from our initiatives and favorable industry trends, we expect continued growth through 2022 and into 2023. On behalf of my NovaBay colleagues and our Board of Directors, I appreciate your continued support of our path to profitability.\n<\/p>\n \nSincerely, \nSeptember 22, 2022\n<\/p>\n About NovaBay Pharmaceuticals, Inc.:<\/b><\/p>\n \nNovaBay Pharmaceuticals, Inc. is a pharmaceutical company that develops and sells scientifically created and clinically proven eyecare and skincare products. Avenova\u00ae<\/sup> is the most prescribed antimicrobial lid and lash spray and DERMAdoctor\u00ae<\/sup> is a premium skincare brand offering more than 30 dermatologist-developed skincare products sold through traditional domestic retailers, digital beauty channels and international distributors.\n<\/p>\n NovaBay Pharmaceuticals Forward-Looking Statements<\/b><\/p>\n \nThis press release contains \u201cforward-looking statements\u201d within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, but not limited to, statements that are based upon management\u2019s current expectations, assumptions, estimates, projections and beliefs. The use of words such as, but not limited to, \u201canticipate,\u201d \u201cbelieve,\u201d \u201ccontinue,\u201d \u201ccould,\u201d \u201cestimate,\u201d \u201cexpect,\u201d \u201cintend,\u201d \u201cmay,\u201d \u201cmight,\u201d \u201cplan,\u201d \u201cpotential,\u201d \u201cpredict,\u201d \u201cproject,\u201d \u201cshould,\u201d \u201ctarget,\u201d \u201cwill,\u201d or \u201cwould\u201d and similar words or expressions are intended to identify forward-looking statements. These statements include, but are not limited to, statements regarding our business strategies, ability to complete certain financing transactions, current and future product offerings, marketing efforts, and any future revenue that may result from selling such products, as well as generally the Company\u2019s expected future financial results (and ability to continue as a going concern) and the impact of a reverse stock split. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or achievements to be materially different and adverse from those expressed in or implied by the forward-looking statements. New risks and uncertainties may emerge from time to time, and it is not possible to predict all risks and uncertainties. Other risks relating to NovaBay\u2019s business, including risks that could cause results to differ materially from those projected in the forward-looking statements in this press release, are detailed in NovaBay\u2019s latest Form 10-Q\/K filings with the Securities and Exchange Commission (the \u201cCommission\u201d), especially under the heading \u201cRisk Factors,\u201d and in the Preliminary Proxy Statement filed by NovaBay with the Commission, especially under the heading \u201cProposal Two: The Reverse Stock Split Proposal \u2014 Risks Relating to the Reverse Stock Split.\u201d The forward-looking statements in this press release speak only as of this date, and NovaBay disclaims any intent or obligation to revise or update publicly any forward-looking statement except as required by law.\n<\/p>\n Additional Information<\/b><\/p>\n \nAs referenced above, certain stockholder matters will need to be voted upon (the \u201cStockholder Matters\u201d) and the Company filed a preliminary proxy statement with the Commission on September 20, 2022, and intends to subsequently mail or otherwise make available a definitive proxy statement relating to the Stockholder Matters. This press release does not contain all the information that should be considered concerning the Stockholder Matters, and is not intended to form the basis of any voting decision, investment decision or any other decision in respect of the Stockholder Matters. The Company\u2019s stockholders and other interested persons are advised to read the preliminary proxy statement and the amendments thereto and the definitive proxy statement and other documents filed in connection with the Stockholder Matters, as these materials will contain important information about these matters, as well as the Company and the related financing transactions. When available, the definitive proxy statement and other relevant materials will be sent or given to stockholders of the Company as of a record date to be established for voting on the Stockholder Matters. Stockholders will also be able to obtain copies of the preliminary proxy statement, the definitive proxy statement and other documents filed with the Commission, without charge, once available, at the Commission\u2019s website at www.sec.gov<\/a>, or by directing a request to: NovaBay Pharmaceuticals, Inc., 2000 Powell Street, Suite 1150, Emeryville, CA 94608, attention: Corporate Secretary.\n<\/p>\n Participants in the Solicitation<\/b><\/p>\n \nThe Company and its directors and executive officers may be deemed participants in the solicitation of proxies from the Company\u2019s stockholders with respect to the Stockholder Matters. A list of the names of those directors and executive officers and a description of their interests in the Company is contained in the Company\u2019s filings with the Commission, including in the Company\u2019s Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the Commission and is available free of charge at the Commission\u2019s website at www.sec.gov<\/a>, or by directing a request to: NovaBay Pharmaceuticals, Inc., 2000 Powell Street, Suite 1150, Emeryville, CA 94608, attention: Corporate Secretary. Additional information regarding the interests of such participants is contained in the preliminary proxy statement and will be contained in the definitive proxy statement for the Stockholder Matters when available. In addition, we have engaged Alliance Advisors, LLC, to assist in the solicitation of proxies and provide related advice and informational support.\n<\/p>\n Socialize and Stay Informed on NovaBay<\/span><\/b>\u2019<\/span>s Progress<\/span><\/b><\/p>\n \nLike us on Facebook View source version on businesswire.com: <\/span>https:\/\/www.businesswire.com\/news\/home\/20220922005865\/en\/<\/a><\/span><\/p>\n Avenova Purchasing Information DERMAdoctor Purchasing Information NovaBay Contact
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Justin Hall, Esq.
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Chief Executive Officer and General Counsel\n<\/p>\n
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Follow us on Twitter
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Connect with NovaBay on LinkedIn
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Visit NovaBay\u2019s Website<\/a><\/p>\n<\/p>\n
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For NovaBay Avenova purchasing information:
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Please call 800-890-0329 or email sales@avenova.com
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Avenova.com<\/a><\/p>\n
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For DERMAdoctor purchasing information:
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Please call 877-337-6237 or email service@dermadoctor.com
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DERMAdoctor.com<\/a><\/p>\n
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Justin Hall
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Chief Executive Officer and General Counsel
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510-899-8800
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jhall@novabay.com<\/a><\/p>\n