On August 14, 2026, the U.S. Securities and Exchange Commission (SEC) issued orders granting accelerated approval of proposed rule changes by the New York Stock Exchange LLC (NYSE) and NYSE American LLC (NYSE American), as modified by Amendment No. 2 and Amendment No. 4, respectively, to adopt new continued listing requirements imposing a 25-cent-per-share minimum trading price. If a security’s closing price falls below 25 cents on any trading day, the applicable exchange will immediately suspend trading and commence delisting proceedings. Unlike most other continued listing deficiencies, no compliance cure period is available for a minimum trading price deficiency under the new rules.

Both rules were originally slated to become effective on October 1, 2026. In response to public comments requesting additional time, the NYSE and the NYSE American filed amendments, each extending the effective date to July 1, 2027. In approving the NYSE American rule change, the Securities and Exchange Commission found that this nine-month delay “addresses potential administrative and governance burdens on listed issuers” and is “consistent with the original proposal’s intent to provide sufficient time to implement reverse stock splits to increase share prices.” The extended transition period provides affected issuers with the benefit of their 2027 annual meeting to take proactive action, including securing shareholder approval for any necessary reverse stock splits.

Background

Existing Framework. Under the NYSE’s existing continued listing rules, Section 802.01C of the NYSE Listed Company Manual provides that a company is considered below compliance standards if the average closing price of a security is less than $1 over a consecutive 30-trading-day period. Upon notification, the company has a six-month cure period to bring its share price and average share price back above $1. While NYSE American does not have a comparable $1 minimum price standard, Section 1003(f)(v) of the NYSE American LLC Company Guide provides that the exchange will consider initiating suspension and delisting procedures when a class of common stock is selling for a substantial period at a low price per share and the issuer fails to effect a reverse stock split within a reasonable time after being notified that the exchange deems such action to be appropriate under all the circumstances. Both exchanges have maintained a practice of initiating immediate suspension and delisting when a stock trades below 10 cents per share.

The New 25-Cent Minimum Trading Price Trigger. The new rules do not replace the existing price-related continued listing standards or the associated cure periods, which continue to apply. On the NYSE, companies trading between 25 cents and $1 remain subject to the existing $1 minimum price noncompliance process and the six-month cure period. On NYSE American, the exchange will continue its practice of engaging with issuers whose 30-trading-day average closing price falls below $1 and encouraging remedial action. Rather, the new rules impose an additional, lower per-share trading price floor on both exchanges that will result in immediate suspension and initiation of delisting proceedings upon a single-day close below 25 cents, with no cure period. The 25-cent threshold operates as a hard floor beneath the existing framework–once breached, there is no opportunity to cure. The exchanges have determined that securities trading below 25 cents are more susceptible to trading volatility and market manipulation and are generally unlikely to recover to any meaningful degree.

Summary of New Exchange Rules

NYSE: Section 802.01C of the NYSE Listed Company Manual. The amended rule specifies that if a security’s closing price per share is less than 25 cents on any trading day, the NYSE will immediately suspend trading and commence delisting proceedings in accordance with Section 804.00 of the manual. The company will receive neither the six-month cure period otherwise available for the $1 minimum price deficiency nor the opportunity to submit a plan to regain compliance with continued listing standards under Section 802.02.

NYSE American: Section 1003(f)(v) of the NYSE American LLC Company Guide. The amended rule specifies that if a security’s closing price per share is less than 25 cents on any trading day, NYSE American will immediately suspend trading and commence delisting proceedings in accordance with Section 1009 of the guide. The company will not receive the opportunity to submit a plan to come back into compliance with continued listing standards, which is otherwise available for other listing deficiencies under Section 1009.

Immediate Trading Suspension. Upon a single-day close below 25 cents, the applicable exchange will immediately suspend trading and commence delisting proceedings. There is no multi-day measurement period–a single closing price below 25 cents on any trading day is sufficient to trigger the rule.

No Cure or Compliance Period. Unlike most other continued listing deficiencies, companies will not receive a notice of noncompliance with an opportunity to submit a plan to return to compliance.

Appeal Procedures. Issuers subject to immediate suspension and delisting proceedings retain the right to appeal the delisting decision:

  • On the NYSE, appeals proceed under Section 804.00 of the NYSE Listed Company Manual. The company will be given written notice and an opportunity to respond. A request for review will ordinarily stay the suspension, but the exchange staff may immediately suspend trading pending review if it determines that such suspension is necessary or appropriate in the public interest, for the protection of investors, or to promote just and equitable principles of trade.

  • On the NYSE American, appeals proceed under Part 12 of the NYSE American LLC Company Guide. The company will be given written notice and an opportunity to respond and may appeal through the Listing Qualifications Panel to the Committee for Review. A request for a hearing will ordinarily stay the delisting action, but the exchange staff may immediately suspend trading pending review if it determines that such suspension is necessary or appropriate in the public interest, for the protection of investors, or to promote just and equitable principles of trade.

Next Steps

Monitor trading price. Companies whose share price is near or below 25 cents should take immediate action. Because a single-day close below 25 cents triggers the rule effective July 1, 2027, companies should proactively monitor their stock price daily.

Evaluate reverse stock splits. Given the July 1, 2027, effective date, companies whose stock price may approach 25 cents should evaluate the feasibility of a reverse stock split to increase their per-share trading price. Companies should plan early enough to secure shareholder approval at or before their 2027 annual meeting. Companies should also be mindful that both exchanges’ existing rules remain in place prohibiting one or more reverse stock splits with a cumulative ratio of 200 shares or more to one in a two-year period and a reverse stock split that results in a company becoming noncompliant with other continued listing requirements.

Audit contractual triggers. Companies should review credit agreements, indentures, and other material contracts for provisions triggered by delisting, suspension of trading, or transfer to the over-the-counter market. Early identification of such provisions is critical to managing exposure.

Understand the appeal process. Companies should familiarize themselves with the appeal procedures available under Section 804.00 of the NYSE Listed Company Manual or Part 12 of the NYSE American LLC Company Guide as applicable, including the timing and requirements for filing an appeal and the circumstances under which a stay of suspension may be granted.

Prepare strategic alternatives. Evaluate capital raises or business combinations to maintain share price above 25 cents. Consider reverse stock splits carefully in light of existing limitations on cumulative reverse split ratios and the risk that reverse splits may invite downward price pressure.

Engage advisors. Retain capital markets counsel and financial advisors to develop a contingency plan well in advance of the July 1, 2027, effective date.

Contact Us

If you have questions regarding the new minimum trading price continued listing requirements or you need guidance on preparing for an initial or continued listing on the NYSE or the NYSE American, including initial public offerings, de-SPAC transactions, direct listings, or strategies for maintaining compliance with ongoing listing requirements, please contact a member of our Capital Markets & Securities team. We are available to provide practical, tailored advice to help issuers, investment banks, and other market participants navigate the evolving regulatory landscape.

Please contact the listed attorneys for further information on the matters discussed in this alert.