For 30 consecutive business days, NexGel's stock closed below a dollar. Nasdaq sent a deficiency notice on April 22. Now the company has until October 19 to fix it — and it is asking shareholders for the tool to do so: a reverse stock split that could combine as many as twenty shares into one.
A reverse split does not change what the company is worth. It repackages the same value into fewer, higher-priced shares. At the maximum ratio the proxy requests, each shareholder would end up with one share for every twenty held, and the price per share rises in proportion. Nasdaq's continued-listing rules require a sustained closing price at or above $1.00; a large enough split achieves that mathematically, though it offers no guarantee the price holds afterward.
The preliminary proxy, filed on August 14, calls a special shareholder meeting for September 23. The board wants discretion to choose any split ratio between 1-for-2 and 1-for-20, at any point within the year following a vote. It can also choose not to act — or to wait and see whether the stock recovers on its own before the October 19, 2026 compliance deadline.
A second proposal on the same ballot would expand the authorized share count from 25 million to as many as 150 million. The proxy says the company does not currently have enough authorized shares to cover all its existing obligations, including outstanding convertible notes, warrants and equity plan awards, each of which requires shares to be held in reserve. Every new share issued under an expanded authorization makes existing ones worth a smaller slice of the same company. The proxy does not specify the size of those pending obligations.
NexGel shares closed 15.61% higher at $0.5650 on August 14, from a previous close of $0.4887. Dollar volume was about $913,000 across 11,834 trades. The free float is about 7.1 million shares, or 76.6% of shares outstanding. Short volume on the session was 92,500 shares, representing 25.83% of reported volume.
Both proposals require a majority of outstanding shares to pass. The shareholder vote is September 23; the Nasdaq compliance deadline is October 19.