On August 14, 2026, the Securities and Exchange Commission (the “SEC”) approved, on an accelerated basis, the proposed changes to the NYSE American Company Guide (the “Company Guide”) that would, among other things, provide for the immediate suspension of trading and commencement of delisting proceedings if the closing price of an issuer’s security is less than $0.25 on any trading day.

The NYSE American originally filed the proposed rule changes with the SEC on December 3, 2025. Subsequently, NYSE American filed four amendments to the proposed rule changes, with Amendment No. 4 having been filed on July 15, 2026.

The rule changes will not be effective until July 1, 2027. NYSE American believes that this timing, which is extended from the previously proposed effective date of October 1, 2026, will provide issuers with a transition period during which they can take steps to increase their share price before the new requirement is in place, including through the implementation of reverse stock splits.

General Discussion

The Company Guide sets forth minimum quantitative and qualitative continued listing standards for securities listed on NYSE American. With respect to share price, as per Section 1003(f)(v) of the Company Guide, when a class of common stock is selling for a substantial period of time at a low price per share and the issuer fails to take corrective action, NYSE American will consider initiating delisting proceedings. Generally this has involved the issuer and NYSE American staff having proactive discussions when the trading price falls below $1.00, with suspension and delisting proceedings arising when the stock trades below $0.10 per share.

However, citing a recent increase in the trading of low-priced securities, and expressing a belief that low-priced securities are potentially susceptible to manipulation and more likely to experience trading volatility, and that such securities are unlikely to experience a meaningful trading price recovery, NYSE American proposed amendments to Section 1003 of the Company Guide to establish a definitive minimum trading price per share.

Specifically, the proposed rules, as approved by the SEC, amend Section 1003(f)(v) of the Company Guide to specify that if the per share closing price of a security is less than $0.25 on any single trading day, NYSE American shall immediately – without any compliance or cure period – suspend trading and commence delisting proceedings with respect to such security.

In addition to establishing a $0.25 hard floor for continued listing on NYSE American, the new rules also provide NYSE American with the authority to suspend trading or delist a security where, in NYSE American’s opinion, the trading price has experienced a precipitous decline and is at an abnormally low level from which it is unlikely to recover, even if such security has not fallen below $0.25. The rules do not provide any guidelines as to what would constitute a “precipitous decline” or an “abnormally low” trading price, thus leaving these items open to interpretation.

A listed company whose security is subject to immediate suspension of trading and the commencement of delisting proceedings will still be able to appeal the delisting decision in accordance with the provisions in Part 12 of the Company Guide.

Throughout the approval process, commenters raised several concerns regarding the proposed  rule changes, including whether the $0.25 minimum price is a reliable predictor of ongoing and insurmountable financial distress, whether the rule changes would negatively impact capital formation for small public companies and thereby increase risk to investors, whether the establishment of a trading price floor could increase market manipulation risk, and whether the lack of a cure or compliance period implicates fair procedure concerns under Section 6(b)(7) of the Securities Exchange Act of 1934.

Although the SEC acknowledged these concerns in its order, it generally deferred to NYSE American’s market integrity and investor protection concerns, concluding that the new rules are reasonably designed to prevent fraudulent and manipulative acts and practices and to protect investors and the public interest, and thus that they should be approved on an accelerated basis.

Conclusion

Over the past several years, The Nasdaq Stock Market (“Nasdaq”) and NYSE American have modified their rules in ways that have made it more challenging for smaller public companies to obtain and maintain a listing, with the broad intention of promoting the orderly functioning of the markets and protecting investors.  The newly-approved NYSE American continued listing standards regarding low-priced securities are another step in that process. Companies listed on NYSE American whose shares are not trading comfortably above $0.25 should closely monitor the price of their shares and begin to strategize as to how to increase the trading price of their shares prior to the effectiveness of the rules on July 1, 2027, including raising capital, expanding investor engagement efforts, and taking steps to implement (or to obtain the authority to implement on an expedited basis) a reverse stock split.

If you have any questions or would like additional information about the NYSE American’s new continued listing standards for low-priced securities, or the recent changes to the listing standards proposed and/or adopted by NYSE American and Nasdaq, please reach out to the authors of this Legal Update, or to the Pryor Cashman professionals with whom you work.