SEC Approves NYSE American $0.25 Minimum Trading Price Rule

On August 14, 2026, the Securities and Exchange Commission (“SEC”) approved to the NYSE American (the “Exchange”) continued listing standards that establish a new $0.25 minimum trading price for listed securities. Under the new NYSE American Company Guide, if a security’s closing price per share falls below $0.25 on any trading day, NYSE American will immediately suspend trading and commence delisting proceedings. The rule will become effective July 1, 2027, nine months later than the originally proposed October 1, 2026 implementation date.

The delayed effective date gives NYSE American listed companies—particularly smaller companies with low or volatile stock prices—additional time to evaluate their continued listing position and, where appropriate, obtain stockholder approval and implement a reverse stock split or other measures before the new standard takes effect.

A New $0.25 “Hard Floor”

NYSE American has amended Section 1003(f)(v) of the NYSE American Company Guide to establish a new $0.25 minimum trading price requirement, effective July 1, 2027. Under the prior standard, NYSE American staff generally engaged with issuers whose securities traded below $1.00 per share and could promptly initiate suspension and delisting proceedings if a security traded below $0.10 per share.

Beginning July 1, 2027, the new rule will replace the $0.10 policy-based threshold with an express $0.25 minimum trading price requirement. If a listed security closes below $0.25 on any trading day, NYSE American will immediately suspend trading in the security and commence delisting proceedings. Unlike the process applicable to many other continued listing deficiencies, an issuer will not receive a cure period or an opportunity to submit a compliance plan under Section 1009 following a violation of the $0.25 requirement. Although the issuer will retain applicable rights to appeal the delisting determination, the trading suspension will remain in effect during the appeal process.

The single-day trigger represents a significant change for low-priced issuers. The $0.25 threshold is not measured based on a 30-day average or a specified number of consecutive trading days. Accordingly, once the threshold is breached, an issuer may have little, if any, practical opportunity to take corrective action before trading in its securities is suspended and delisted.

NYSE American Retains Discretion to Act Above $0.25

The $0.25 threshold also should not be viewed as an absolute safe harbor. The amended rule expressly confirms NYSE American’s authority to suspend trading or delist a security that has experienced a “precipitous decline” and reached an “abnormally low level” from which, in the Exchange’s view, it is unlikely to recover—even if the security has not closed below $0.25. The rule does not prescribe objective numerical standards for exercising this discretion.

Accordingly, issuers experiencing a rapid deterioration in trading price should consider engaging with NYSE American and counsel before their stock approaches the $0.25 threshold.

Reverse Stock Splits Offer a Limited Compliance Tool

The delayed July 1, 2027 effective date provides low-priced issuers additional time to consider proactive measures, including a reverse stock split, to maintain a trading price above the new $0.25 threshold. NYSE American and the SEC specifically noted that the extended implementation period would allow affected issuers to seek any necessary stockholder approvals at their 2027 annual meetings. Once the new rule becomes effective, however, an issuer that closes below $0.25 will be subject to immediate suspension and delisting proceedings without the benefit of the compliance procedures under Section 1009. Accordingly, a reverse stock split generally would need to be implemented before the $0.25 threshold is breached rather than used as a means to regain compliance afterward.

Issuers also face significant limitations on the use of reverse stock splits to maintain continued listing. Under Section 1003(f)(vi) of the NYSE American Company Guide, NYSE American will immediately commence suspension and delisting proceedings if an issuer has effected one or more reverse stock splits during the preceding two-year period with a cumulative ratio of 200-to-1 or greater. An issuer subject to this provision is not eligible for a cure period or compliance plan under Section 1009. As a result, issuers that have previously completed reverse stock splits may have materially less flexibility to undertake another split in response to a declining trading price.

In addition, Section 1003(f)(vii) provides that NYSE American will immediately commence suspension and delisting proceedings if a reverse stock split causes an issuer to fall below any other continued listing requirement under Section 1003. This limitation can be particularly relevant because a reverse stock split reduces the number of outstanding shares and may affect compliance with other quantitative listing standards. Here too, the issuer is not entitled to the ordinary Section 1009 compliance procedures.

Taken together, these provisions substantially limit an issuer’s ability to rely repeatedly on reverse stock splits to address a persistently low trading price. Companies trading near the $0.25 threshold should therefore evaluate well in advance of July 1, 2027 whether a reverse stock split is available, the permissible split ratio in light of prior reverse splits and whether the resulting capital structure would continue to satisfy all other applicable NYSE American listing standards.

What NYSE American Companies Should Do Now

Companies whose securities trade at relatively low prices should use the period before July 1, 2027 to:

• Establish internal monitoring and escalation procedures for low-price trading, including identifying when management, the board and outside advisers should be engaged as the trading price approaches the $0.25 threshold.
• Assess the company’s ability to implement a reverse stock split, including prior split history, applicable corporate authorization requirements, stockholder approval requirements and available timing for obtaining any necessary approvals.
• Evaluate whether a proposed reverse stock split would itself create compliance issues, including under the cumulative 200-to-1 limitation and other applicable NYSE American continued listing standards.
• Review the broader effects of any reverse stock split on outstanding warrants, convertible securities, equity awards, financing arrangements and other contractual provisions that may require adjustment.
• Consider appropriate disclosure in upcoming periodic reports and proxy statements, including whether existing disclosure adequately addresses the new minimum trading price requirement, potential trading suspension or delisting and any anticipated reverse stock split.
• Engage with NYSE American and outside advisers early if the company’s trading price declines materially or approaches the new threshold, particularly where available compliance alternatives may require advance corporate action.
• Prepare in advance for potential noncompliance, including evaluating the consequences of a trading suspension or delisting for stockholder liquidity, financing arrangements and access to the capital markets.

The rule comes amid broader NYSE and SEC efforts to enhance the competitiveness and accessibility of the U.S. public markets, including initiatives relating to offering reform, filer-status simplification and IPO modernization. For smaller NYSE American issuers, however, the new minimum trading price requirement represents a meaningful tightening of the continued listing standards. Although the delayed July 2027 effective date provides additional time to prepare, issuers with low or volatile trading prices should begin evaluating potential compliance strategies well in advance.

Please contact the authors if you have any questions regarding the new NYSE American requirements or would like assistance evaluating potential compliance strategies.