Netcapital Inc. Announces Inducement Grant Under Nasdaq Listing Rule 5635(c)(4)

Rhea-AI Summary

Netcapital (Nasdaq: NCPL, NCPLW) granted a 1,000,000-share inducement restricted stock award to a new employee under the 2023 Omnibus Equity Incentive Plan in accordance with Nasdaq Listing Rule 5635(c)(4).

The award has voting rights upon issuance and vests, in whole or in part, on March 15, 2027. Vesting is tied to Company revenue for the period Feb 1, 2026 to Jan 31, 2027: below $900,000 = 0% vesting; at least $1,500,000 = 100% vesting; pro-rata vesting applies between those thresholds.

Positive

• Inducement grant of 1,000,000 shares aligns pay with revenue target
• Award vests only after measurable revenue period ending Jan 31, 2027
• Shares carry voting rights upon issuance

Negative

• Potential dilution of up to 1,000,000 shares if fully vested
• No vesting if revenue is below $900,000 for measuring period

Key Figures

Current share price $0.6589 Prior to inducement grant announcement

S-3 shelf size $50,000,000 Form S-3 shelf filed Oct 21, 2025

Unsold prior securities $9,004,894.40 Carried forward under Rule 415(a)(6)

Shares outstanding 4,917,889 shares As of Oct 21, 2025

Inducement grant size 1,000,000 shares Restricted stock award to new employee

Minimum revenue vesting hurdle $900,000 Measuring period Feb 1, 2026 – Jan 31, 2027

Maximum revenue vesting hurdle $1,500,000 Measuring period Feb 1, 2026 – Jan 31, 2027

Vesting date March 15, 2027 Inducement restricted stock award

Market Reality Check

$0.6589 Last Close

Volume Volume 923,733 is 1.53x the 20-day average of 604,952 shares, indicating elevated trading activity before this inducement news. high

Technical Shares at $0.6589 are trading below the 200-day moving average of $2.47, and sit far under the $8.75 52-week high while hovering near the $0.62 52-week low.

Peers on Argus 1 Up

Peers in capital markets are mixed: moves range from -6.52% (MIGI) to +16.92% (MEGL). Only ANY appeared on the momentum scanner, up 7.61% without news, suggesting NCPL’s sharp -21.68% move was more stock-specific than a broad sector reaction.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Dec 08	Leadership change	Positive	-21.7%	New CEO appointed while former CEO remains as advisor.
Nov 19	Strategic partnership	Positive	-37.1%	Plan to integrate blockchain-native secondary trading and tokenized assets.
Sep 22	Quarterly earnings	Negative	-1.2%	Higher operating loss despite 34% revenue growth in Q1 FY26.
Aug 12	Full-year earnings	Negative	-21.0%	Updated FY25 results with steep revenue decline and wider losses.
Aug 12	Full-year earnings	Negative	-21.0%	FY25 results show lower revenue and significant impairment loss.

Pattern Detected

Recent history shows repeated negative price reactions, even to seemingly strategic or leadership-positive announcements, alongside sharp sell-offs on weak earnings.

Recent Company History

Over the last six months, Netcapital has reported several challenging updates. Fiscal 2025 results on Aug 12, 2025 showed revenue dropping to $869,460 and operating loss widening to ($8.32 million), with a related impairment loss of $19.9 million, and the stock fell 20.99%. Q1 FY26 results on Sep 22, 2025 showed revenue growth of 34% to $190,058 but a larger operating loss of ($3.29 million). Strategic blockchain and secondary trading plans (Nov 19) and the CEO appointment (Dec 8) still saw price drops of 37.13% and 21.68%, respectively, underscoring persistent market skepticism.

Regulatory & Risk Context

Active S-3 Shelf Registration 2025-10-21

$50,000,000 registered capacity

An effective Form S-3 shelf filed on Oct 21, 2025 allows Netcapital to offer up to $50,000,000 of various securities from time to time, with $9,004,894.40 carried forward from a prior registration. This structure gives the company flexibility to raise capital via equity or other securities, which can be dilutive when utilized.

Market Pulse Summary

This announcement details a performance-based inducement grant of 1,000,000 restricted shares to a new employee, vesting on March 15, 2027 based on revenue between $900,000 and $1,500,000 for the specified period. It follows a stretch of weak financial results, including FY25 revenue of $869,460 and an operating loss of ($8.32 million). Investors may monitor future revenue trends, use of the $50,000,000 S-3 shelf, and whether performance targets are met.

Key Terms

equity incentive plan financial

"under the Netcapital Inc. 2023 Omnibus Equity Incentive Plan (the “Plan”)"

An equity incentive plan is a program that gives employees, executives or directors the right to receive company stock or options to buy stock as part of their pay. Think of it as offering slices of future company profit to motivate people to boost long‑term performance; for investors it matters because it can align employee goals with shareholder value but also increases the number of shares outstanding, which can dilute existing ownership.

nasdaq listing rule 5635(c)(4) regulatory

"in accordance with Nasdaq Listing Rule 5635(c)(4)"

NASDAQ Listing Rule 5635(c)(4) is a rule that requires a company to get approval from its shareholders before selling a large amount of its shares, usually over 20%. This helps protect investors by making sure the company doesn't flood the market with new shares without their say, which could lower the stock's value.

AI-generated analysis. Not financial advice.

BOSTON, MA, Dec. 08, 2025 (GLOBE NEWSWIRE) -- Netcapital Inc. (Nasdaq: NCPL, NCPLW) (the “Company”), a digital private capital markets ecosystem, announced today the grant of an inducement restricted stock award of 1,000,000 shares of common stock (“Restricted Stock Award”) to a new employee under the Netcapital Inc. 2023 Omnibus Equity Incentive Plan (the “Plan”). The Restricted Stock Award was granted as an inducement under the Plan and related form of restricted stock award agreement in accordance with Nasdaq Listing Rule 5635(c)(4).

The 2023 Equity Incentive Plan provides for the issuance of equity awards in the form of inducement grants pursuant to Nasdaq Listing Rule 5635(c).

The Restricted Stock Award will have voting rights upon issuance and will vest, in whole or in part, on March 15, 2027, with the number of shares of restricted stock to be vested on the vesting date determined based on the Company’s revenue during the period beginning on February 1, 2026 and ending on January 31, 2027. Specifically, in the event that the revenue during the measuring period is below $900,000, none of the shares of Restricted Stock shall vest and in the event that the revenue during the measuring period is at least equal to $1,500,000, one hundred percent (100%) of the shares of Restricted Stock shall vest as of the vesting date, with pro-rata vesting for results between the minimum and maximum revenue targets.

About Netcapital Inc.

Netcapital Inc. is a fintech company with a scalable technology platform that allows private companies to raise capital online and provides private equity investment opportunities to investors. The Company's consulting group, Netcapital Advisors, provides marketing and strategic advice and takes equity positions in select companies. The Company’s funding portal, Netcapital Funding Portal, Inc. is registered with the U.S. Securities & Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA), a registered national securities association. The Company’s broker-dealer, Netcapital Securities Inc., is also registered with the SEC and is a member of FINRA.

Forward Looking Statements

The information contained herein includes forward-looking statements. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

Investor Contact

800-460-0815 
ir@netcapital.com

FAQ

What did Netcapital (NCPL) announce on December 9, 2025 about equity awards?

Netcapital announced a 1,000,000-share inducement restricted stock award to a new employee under its 2023 Equity Incentive Plan.

When does the NCPL restricted stock award vest and what is the vesting date?

The award vests, in whole or in part, on March 15, 2027.

What revenue targets determine vesting for Netcapital's NCPL award?

Vesting depends on revenue from Feb 1, 2026 to Jan 31, 2027: below $900,000 = 0% vesting; at least $1,500,000 = 100% vesting; pro-rata between.

Does the NCPL restricted stock award carry voting rights before vesting?

Yes. The Restricted Stock Award has voting rights upon issuance.

How might the NCPL inducement grant affect shareholders?

The award could result in dilution of up to 1,000,000 shares if fully vested on the vesting date.