SEC Grants Petitions For Review Of Nasdaq’s $5 Million MVLS Listing Standard And Extends Review Period For NYSE American’s Proposed $5 Million Average Market Capitalization Requirement

As we discussed in our prior posts, on July 22, 2026, the Securities and Exchange Commission (SEC) approved a new Nasdaq continued listing rule requiring a minimum Market Value of Listed Securities (MVLS) of $5 million, with no automatic cure period and immediate delisting consequences after 30 consecutive business days of non-compliance. That approval was automatically stayed after the Small Public Company Coalition and Cemtrex, Inc. filed notices of intention to petition for review.

On September 11, 2026, the SEC formally granted those petitions for review. The approval order remains stayed pending further SEC action, meaning the $5 million MVLS requirement is still not in effect. The SEC’s granting order also stated that any party or other person may file a written statement in support of or in opposition to the approval order within 21 days of publication in the Federal Register. Companies and industry stakeholders who wish to weigh in on the proposed rule change should consider filing a statement during the 21-day review period.

Separately, on September 14, 2026, the SEC designated an additional 60-day review period for a proposed rule change filed by NYSE American that would establish a $5 million average market capitalization continued listing requirement.¹ Like the proposed Nasdaq $5 million MVLS rule, a company that failed to comply would be subject to immediate suspension and delisting. The SEC is continuing to accept comments to this proposed rule change.²

While these developments are welcome news for microcap issuers, the SEC could ultimately reaffirm and approve the proposed rule changes. Companies trading near the applicable $5 million MVLS or market capitalization threshold should continue to monitor for further developments and evaluate our suggested strategies to maintain compliance should these propose rule changes come into effect, as we outlined in our July 24 post.³ We will continue to monitor the SEC’s proceedings and provide updates.

Footnotes

1 Notably, the NYSE American market capitalization test would count any common stock that would be issued upon conversion of another outstanding equity security, if such other security is a “substantial equivalent” of common stock. Generally, the security must be (1) publicly traded or quoted, or (2) convertible into a publicly traded or quoted security. “Substantial equivalent” means the convertible security is presently convertible, and the conversion price is equal to or less than the current market price of the common stock. The NYSE American market capitalization definition is therefore potentially broader than the Nasdaq MVLS, which would not count such “substantial equivalent” securities. However, NYSE American’s requirement would be applied based on the “average” market capitalization for a 30-trading-day period, which would not necessarily be satisfied by engineering periodic one-day spikes at or above the $5 million threshold, unlike the proposed Nasdaq $5 million requirement.

2 Comments to the proposed NYSE American rule change may be submitted here: https://www.sec.gov/comments/sr-nyseamer-2026-17/notice-filing-proposed-change-amend-section-1003-nyse-american-company-guide.

3 Warrant exercises for common stock would not increase the “market capitalization” of companies listed on NYSE American if the warrants are the “substantial equivalent” of common stock, but such exercises would permanently include the underlying common stock in the market capitalization even if the market price subsequently declines below their exercise prices.