NexGel's 100 Million Share Increase Failed At The July 31 Vote. Two Weeks Later It Asked Holders For 150 Million.

by Adam Kowalczyk · August 17, 2026

Filings & Deals Reporter, The MicroCap Herald

NEXGEL, Inc. (Nasdaq: NXGL), a Langhorne, Pennsylvania company, filed a preliminary proxy statement on Friday, Aug. 14 calling a special meeting of stockholders for Sept. 23, 2026 at 10:00 a.m. Eastern, with a record date of Aug. 21. The filing asks holders to amend the certificate of incorporation to increase authorized common stock "from 25,000,000 to a number not to exceed 150,000,000," and separately to effect "a discretionary reverse stock split of our common stock at a ratio in the range of 1-for-2 to 1-for-20." A third proposal would permit adjournment of the meeting to solicit more proxies. We read the filed document itself — the PRE 14A under accession number 0001493152-26-038520 — through NEXGEL's own SEC filings archive rather than through an aggregator's reproduction, and every figure below is quoted from a filing we opened.

The company has asked holders for less than this before and did not get it. At NEXGEL's 2026 annual meeting, a proposal to raise authorized common stock from 25,000,000 to 100,000,000 and a proposal to authorize a reverse split at a ratio between 1-for-2 and 1-for-10 both failed. That meeting was itself a rescheduling: NEXGEL had called it for July 10 in a definitive proxy dated June 9, then said in a current report filed July 9 that it had elected to postpone the meeting to July 31 at 10:00 a.m. Eastern to "allow additional time to solicit proxies from the Company's stockholders in order to obtain the requisite stockholder vote on certain proposals," with the record date unchanged. The company disclosed the outcome in a current report on Form 8-K filed Aug. 5 under Item 5.07.

That 8-K reports 6,398,925 shares represented at the July 31 meeting out of 9,225,242 shares entitled to vote. On the authorized-share proposal, 3,188,609 shares voted for, 512,325 against and 74,724 abstained, with 2,623,267 broker non-votes; the filing states the proposal "did not receive the affirmative vote of a majority of the outstanding shares of common stock required for approval." On the reverse split, 2,888,389 voted for, 829,511 against and 57,758 abstained, with the same broker non-vote total, and that proposal likewise did not reach a majority of the outstanding shares.

Two distinctions matter. Neither proposal was voted down in the ordinary sense — on both, shares voted in favor outnumbered shares voted against by a wide margin. What defeated them was the threshold: a charter amendment requires a majority of all shares outstanding rather than a majority of votes cast, so an abstention and a share a broker cannot vote without instruction carry the same arithmetic weight as a vote against. By our calculation approval required 4,612,622 shares, and the authorized-share proposal fell 1,424,013 shares short. The 2,623,267 broker non-votes were larger than that gap.

Four of the seven items on the July 31 agenda did pass, including the one bearing on the convertible notes: the 8-K states that approval of the issuance of shares upon conversion of the notes and exercise of the warrants from the April 2026 and May 2026 private placements, sought for purposes of Nasdaq Listing Rule 5635(d), "was approved." Director elections, the advisory vote on executive compensation and the auditor ratification also passed. A proposal to reincorporate the company from Delaware to Nevada failed on the votes themselves, drawing 1,761,539 for against 2,010,108 opposed.

Against that record, the Friday proxy raises the request rather than trimming it. The June proposals sought 100,000,000 authorized shares and a split of up to 1-for-10; the September proposals seek a ceiling of up to 150,000,000 and a split of up to 1-for-20, in each case with the board choosing the final figure inside the range. The document carries a table of authorized-share scenarios running from 50 million to 150 million and a table showing what each ratio would do to the outstanding count. Both amendment proposals again require the affirmative vote of a majority of the outstanding shares; the adjournment proposal requires only a majority of the votes cast.

The Friday proxy states that as of Aug. 14, 2026 — which it calls the most recent practicable date before the proxy's date — the company had "9,747,663 shares of common stock issued and outstanding." That count is independently confirmed on the cover page of NEXGEL's quarterly report for the period ended June 30, 2026, filed Monday, Aug. 17, which states that as of Aug. 14 the registrant had 9,747,663 shares of common stock outstanding. Against a 25,000,000-share authorization that leaves 15,252,337 authorized but unissued shares, by our calculation, before subtracting anything reserved for options, restricted stock units, warrants or note conversions; the proxy's figure for that reserved total is a bracketed placeholder, a normal feature of a preliminary filing. Every share figure in this article is shares issued and outstanding, or where stated shares entitled to vote at the July 31 meeting — not float, not volume, not votes cast — and none is adjusted for a reverse split, because no split has been effected and the only split authorization put to holders so far failed. The March 31, 2026 quarterly report showed 8,475,693 shares outstanding on the balance sheet at March 31 and 9,131,055 on its cover page as of May 13.

We searched the Friday proxy for a reference to the July 31 vote and did not find one. The document gives the board's reasons for the increase — complying with existing contractual obligations, financing flexibility, continued equity incentive compensation, strategic transactions and general corporate needs — without recounting the earlier result. A preliminary proxy is a draft whose bracketed figures are still to be filled in, and a definitive version may add background. We are not suggesting the omission is improper: the July 31 results were separately disclosed in the Aug. 5 current report.

The listing clock runs separately, and on price. The Friday proxy states that on April 22, 2026 the company received a deficiency letter from the Nasdaq Listing Qualifications Department notifying it that for the prior 30 consecutive business days the closing bid price of its common stock had been below the minimum $1.00 per share required for continued listing under Nasdaq Listing Rule 5550(a)(2). The same filing states that in accordance with Nasdaq Listing Rule 5810(c)(3)(A) the company has been given 180 calendar days, or until Oct. 19, 2026, to regain compliance. Oct. 19 is exactly 180 days after April 22, by our calculation.

On what follows that date, the company's own language is conditional. The proxy says that if compliance is not regained by the deadline NEXGEL "may be afforded a second 180 calendar day period to regain compliance," provided it meets "the continued listing requirements for The Nasdaq Capital Market other than the Minimum Bid Price Requirement" and notifies Nasdaq of its intent to cure during that second period, "including by effecting a reverse stock split if necessary." On the split itself the proxy states: "There can be no assurance, however, that the Reverse Stock Split, if implemented, will result in any of the foregoing benefits." Every rule reference in this article is reproduced as NEXGEL's filings state it; we did not open Nasdaq's rulebook, and a reader relying on the mechanics should go to the current rule text rather than to a company's description of it or to ours.

The reason the authorized number is under pressure is set out at length in the June proxy, which is on EDGAR and which we read directly. It describes unsecured convertible promissory notes issued in April and May 2026 with an initial conversion price of $0.60 a share, across tranches that include $6,900,000 of April notes convertible into 11,500,000 shares, a $5,000,000 note the proxy calls the Celularity Note convertible into 8,333,333 shares, and $1,210,000 of May notes convertible into 2,016,667 shares. The proxy's own total is 25,141,667 underlying shares at the initial conversion price, plus warrants over 6,758,334 shares at an $0.80 exercise price, for a combined 31,900,001 shares. That combined figure exceeds the company's entire 25,000,000-share authorization by 6,900,001 shares, by our calculation, and it assumes no reset.

The June proxy is direct about why that number is not fixed: "There is no floor or minimum on the Conversion Price. As a result, if the trading price of our common stock declines, the Conversion Price will decline as well." It discloses full-ratchet anti-dilution on the conversion price, under which an issuance below the then-applicable price resets that price down to the lower one, and states that the notes bear interest at 10% per annum, rising on an event of default to the lesser of 18% per annum or the maximum rate permitted by law.

The proxy sets the consequences out in an illustrative table whose three columns are the assumed conversion price, the approximate shares issuable on conversion and exercise, and the approximate dilution as a percentage of outstanding shares. At $0.60 it shows 31,900,001 shares and 78.3%; at $0.40, 44,470,834 and 83.4%; at $0.30, 57,041,667 and 86.6%; at $0.20, 82,183,334 and 90.3%; and at $0.10, 157,608,334 shares and 94.7%. Reading that last column literally matters: by our calculation the percentages are struck against post-issuance shares outstanding rather than against the pre-issuance count — 31,900,001 divided by the sum of 31,900,001 and the 8,849,665 shares the table uses as its base is 78.3%, and the same method reproduces every other row. Each cell is bracketed in the preliminary filing and expressly subject to update.

Two things about that bottom row deserve care. It is an illustration at an assumed price, not a forecast and not an obligation, and it was prepared for a June filing against a June principal balance. With that said, our comparison across the two documents — not the company's — is that the shares the June table shows issuable at a $0.10 conversion price exceed the entire 150,000,000 ceiling the Friday proxy asks holders to authorize, a ceiling that would also have to accommodate the 9,747,663 shares already outstanding and whatever is reserved for options, restricted stock units and warrants. We are deliberately not putting a single number on that gap: the two figures come from different filings on different dates under different assumptions, and a reverse split would change the underlying mechanics in ways we have not seen the note documents address. Separately, the Friday proxy identifies Sequence LifeScience as the holder of a convertible promissory note in the original principal amount of $5,500,000 and a warrant exercisable for up to 4,583,334 shares, subject to a 9.99% beneficial ownership limitation.

On the operating business, the quarterly report filed Monday shows revenue of $3.69 million for the three months ended June 30, 2026 against $2.88 million a year earlier, and a net loss attributable to NEXGEL stockholders of $3.64 million against $665,000. For the six months, the net loss attributable to NEXGEL stockholders was $4.56 million against $1.38 million. Cash and cash equivalents were $492,000 at June 30 against $317,000 at Dec. 31, 2025, and total stockholders' equity was $5.47 million. The filing states that the company had an unrestricted cash balance of $0.5 million as of June 30, that it used $2.7 million of cash in operating activities over the six months, and that "These conditions raise substantial doubt about the Company's ability to continue as a going concern."

The risks here are stacked and should be stated plainly. On listing: the stated purpose of the reverse-split proposal is to give the board a means of raising the per-share trading price in order to regain and maintain compliance with the minimum bid price requirement, the company's own filing describes a second 180-day period as available only if conditions are met rather than as automatic, and the filing offers no assurance that a split would produce the intended result — a failure to regain compliance puts the Nasdaq listing at risk. On dilution: the conversion price has no floor, the number of shares issuable rises as the price falls, and the company's own illustration runs to 94.7% dilution at a $0.10 assumed price. On going concern: the June 30 quarterly report carries substantial-doubt language, which is a required disclosure about conditions and forward-looking uncertainty; nothing in the filings we read says the company has failed to meet an obligation, and we are not suggesting that it has. And on authority: the Friday proxy is preliminary, partly bracketed, with no definitive version filed, and its proposals are requests for authority that holders did not grant at a lower number two weeks ago. For anyone checking this rather than taking it secondhand, the Aug. 5 8-K carries the July 31 vote totals, the record date of Aug. 21 fixes who may vote at the special meeting, and Oct. 19 falls roughly four weeks after the Sept. 23 meeting. This article takes no view on the shares, contains no price target and is not a recommendation.