On August 14, 2026, the Securities and Exchange Commission approved a significant continued listing rule change for the NYSE American. This order grants accelerated approval to amend Section 1003 of the NYSE American Company Guide. Just two days after I published my detailed analysis of the initial proposal (see my previous blog HERE), the SEC has codified a new reality for micro-cap issuers. The final rule establishes a hard $0.25 minimum price threshold, replacing the prior discretionary guidelines with an automatic trigger for suspension and delisting.
Background and the Retraction of the Market Capitalization Floor
To understand this shift, deal makers must look to the procedural history of this filing. The Exchange initially proposed a dual-track reform that included a hard $5 million market capitalization floor alongside the share price trigger. However, market participants, including the Small Public Company Coalition, raised substantial concerns about the impact on capital formation. In response, NYSE American filed Amendment No. 3, which completely retracted the proposed $5 million market capitalization floor. This strategic pivot keeps the focus solely on share price, avoiding the broader legal challenges currently stalling Nasdaq’s similar market value rule.
As I recently detailed in my analysis of the Nasdaq continued listing standards, the SEC had approved a hard $5 million market value of listed securities threshold. However, that Nasdaq rule was subsequently stayed following a formal petition for review. By focusing solely on a minimum trading price and discarding the market capitalization floor, NYSE American has successfully navigated these procedural hurdles, achieving immediate effectiveness for its new standard.
The Mechanics of the $0.25 Minimum Trading Price Rule
Under newly adopted Section 1003(f)(v) of the Company Guide, the discretionary “low selling price” policy is replaced with a hard floor. The mechanics of the new rule are direct and automatic:
- The Trigger: If a security’s closing value per share is less than $0.25 on any single trading day, the Exchange will immediately suspend transactions and commence delisting proceedings.
- No Compliance Plan: Unlike other quantitative deficiencies, an issuer falling below the $0.25 price floor is completely ineligible to submit a remediation proposal or receive a cure period under Section 1009.
- Right to Appeal: Although a compliance plan is unavailable, issuers retain the option to challenge the delisting determination before an independent panel under Part 12 of the Company Guide.
- Transition Period: To provide sufficient time for planning, the rule will become effective on July 1, 2027 (established by Amendment No. 4). This transition window allows issuers to complete reverse stock splits to elevate their share prices before the hard floor is enforced.
The Discretionary “Precipitous Decline” Standard
While the $0.25 price floor represents a bright-line rule, the exchange has also codified its broader discretionary authority. Under amended Section 1003(f)(v), the exchange may initiate suspension or delisting proceedings if a security experiences a “precipitous decline” and trades at an “abnormally low level” from which it is unlikely to recover, even if the share price remains above $0.25. This provision reinforces the exchange’s role as a gatekeeper and aligns with its general public interest authority under Section 1002(e).
Legacy Discretionary Approach vs. New Codified Rule
To help your board visualize this transition, the table below contrasts the prior discretionary framework with the newly approved hard floor:
| Regulatory Feature | Prior Discretionary Practice | New Codified Rule (July 1, 2027) |
| Deficiency Trigger | Sustained trading at unacceptably low levels (informally < $0.10) | A single daily closing price under $0.25 |
| Cure Period | Eligible for an 18-month compliance plan under Section 1009 | No compliance plan; immediate trading suspension |
| Notice Mechanics | Informal warnings and split requests | Immediate formal delisting determination |
| Reverse Split Strategy | Discretionary adjustments to raise share price | Restricted by the 200:1 cumulative split limit |
| Appeal Stay | Appeal automatically stayed the delisting | Appeal remains available, but trading is suspended |
Relationship Partner Advisory: Proactive Capital Planning
From my perspective as a relationship partner advising public boards and management teams, this rule change demands early, structured action rather than last-minute reaction. Problems usually arise when companies act without consulting experienced corporate counsel, especially given the strict limits surrounding reverse stock splits.
- Audit Cumulative Split Ratios: Under Section 1003(f)(vi) of the Company Guide, any issuer that has completed one or more reverse splits with a total ratio of 200:1 or greater in a trailing two-year period is subject to immediate delisting. Boards must carefully calculate their historical split ratios before initiating another corporate action to avoid triggering an automatic delisting notice.
- Prepare for OTC Transition: If an issuer falls below $0.25 and faces immediate suspension, trading will commence on the over-the-counter markets. While the OTCQB or OTCQX tiers provide a viable secondary market, the loss of a national exchange listing significantly impacts institutional investor access and cost of capital.
- Execute Structural Capital Raises Early: If your stock is trading near the $0.25 threshold, do not wait for a single bad day to trigger a suspension. Work with your bankers and legal counsel to structure compliant equity financings or strategic business combinations that elevate your capitalization and share price cleanly.
The goal is always to keep your transaction and listing clean, compliant, and highly efficient. Proactive planning during this transition period is the best way to protect your public market access.
The Author
Laura Anthony, Esq.
Founding Partner
Anthony, Linder & Cacomanolis
A Corporate and Securities Law Firm
Securities attorney Laura Anthony and her experienced legal team provide ongoing corporate counsel to small and mid-size private companies, public companies as well as private companies going public on the Nasdaq, NYSE American or over-the-counter market, such as the OTCQB and OTCQX. For more than two decades Anthony, Linder & Cacomanolis, PLLC has served clients providing fast, personalized, cutting-edge legal service. The firm’s reputation and relationships provide invaluable resources to clients including introductions to investment bankers, broker-dealers, institutional investors and other strategic alliances. The firm’s focus includes, but is not limited to, compliance with the Securities Act of 1933 offer sale and registration requirements, including private placement transactions under Regulation D and Regulation S and PIPE Transactions, securities token offerings and initial coin offerings, Regulation A/A+ offerings, as well as registration statements on Forms S-1, S-3, S-8 and merger registrations on Form S-4; compliance with the Securities Exchange Act of 1934, including registration on Form 10, reporting on Forms 10-Q, 10-K and 8-K, and 14C Information and 14A Proxy Statements; all forms of going public transactions; mergers and acquisitions including both reverse mergers and forward mergers; applications to and compliance with the corporate governance requirements of securities exchanges including Nasdaq and NYSE American; general corporate; and general contract and business transactions. Ms. Anthony and her firm represent both target and acquiring companies in merger and acquisition transactions, including the preparation of transaction documents such as merger agreements, share exchange agreements, stock purchase agreements, asset purchase agreements and reorganization agreements. The ALC legal team assists Pubcos in complying with the requirements of federal and state securities laws and SROs such as FINRA for 15c2-11 applications, corporate name changes, reverse and forward splits and changes of domicile. Ms. Anthony is also the author of SecuritiesLawBlog.com, the small-cap and middle market’s top source for industry news, and the producer and host of LawCast.com, Corporate Finance in Focus. In addition to many other major metropolitan areas, the firm currently represents clients in New York, Los Angeles, Miami, Boca Raton, West Palm Beach, Atlanta, Phoenix, Scottsdale, Charlotte, Cincinnati, Cleveland, Washington, D.C., Denver, Tampa, Detroit and Dallas.
Ms. Anthony is a member of various professional organizations including the Crowdfunding Professional Association (CfPA), Palm Beach County Bar Association, the Florida Bar Association, the American Bar Association and the ABA committees on Federal Securities Regulations and Private Equity and Venture Capital. She is a supporter of several community charities including the American Red Cross for Palm Beach and Martin Counties, Susan Komen Foundation, Opportunity, Inc., New Hope Charities, the Society of the Four Arts, the Norton Museum of Art, Palm Beach County Zoo Society, the Kravis Center for the Performing Arts and several others.
Ms. Anthony is an honors graduate from Florida State University College of Law and has been practicing law since 1993.
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