NYSE American Proposes Amendments To Initial Listing Standards

On January 8, 2026, the New York Stock Exchange ("NYSE" or "Exchange") submitted a proposed rule change to the Securities and Exchange Commission that would revise the initial listing requirements detailed in Sections 101 and 102 of the NYSE American Company Guide.

The Exchange is proposing the following amendments:

• Any company seeking to list in connection with an initial public offering ("IPO"), including listings via American Depository Receipts or other underwritten public offerings, must have a market value of unrestricted publicly-held shares of at least $15 million which must be satisfied from the offering proceeds based upon the low end of the price range for such offering.
• Increasing the minimum market price to $4.00 per share for Initial Listing Standards 1 through 4 set forth in Rule 101 of the NYSE American Company Guide, consistent with the requirement to meet the exception from the definition of "penny stock" set forth in Rule 3a51-1(a)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
• Companies that are already publicly traded on the OTC Markets or transferring from another national securities exchange must have a total market capitalization that meets the applicable requirement for 90 consecutive trading days prior to applying to list and must also meet the proposed $4.00 price requirement as set forth above over the same period when applying to list under Initial Listing Standard 3 or 4 set forth in Rule 101 of the NYSE American Company Guide.

The foregoing amendments are designed to, among other things, enhance liquidity for securities listed on the exchange while addressing concerns related to price manipulation and stock volatility.

Unrestricted Publicly-Held Shares

Unrestricted Publicly-Held Shares Requirements for Initial Listings

In its recent proposal, the NYSE is proposing to revise all market value of publicly-held shares requirements for initial listings set forth in Section 101 of the NYSE American Company Guide such that the requirement can be met only on the basis of unrestricted publicly-held shares.

To support this change, the NYSE is proposing to introduce new definitions for "publicly-held shares," "restricted securities," "unrestricted securities," and "unrestricted publicly-held shares." These proposed definitions are substantially identical to those already in place for Nasdaq listings.

Currently, when determining the market value of publicly-held shares for initial listings on the NYSE American, securities that are subject to resale restrictions—meaning they are not freely transferable—are included in the market value of publicly-held shares calculation. As a result, restricted securities, or securities that are subject to "lockup" agreements, may be counted toward meeting listing requirements even though they may not contribute to actual market liquidity.

In its proposal, the Exchange emphasized that securities subject to restrictions do not contribute to a company's liquidity at the time of listing, which can result in a less liquid—or potentially illiquid—listing. "The Exchange is concerned because illiquid securities may trade infrequently, in a more volatile manner and with a wider bid-ask spread, all of which may result in trading at prices that may not reflect the security's true market value. Less liquid securities also may be more susceptible to price manipulation, as a relatively small amount of trading activity can have an inordinate effect on market prices."

To address concerns about liquidity, the Exchange is proposing to introduce a new definition of "restricted securities." Under this definition, restricted securities would include any shares subject to resale restrictions for any reason. Examples provided by the Exchange include securities (1) acquired directly or indirectly from a company or an affiliate of a company in unregistered offerings such as private placements, including those pursuant to Regulation D of the Securities Act of 1933, as amended ("Securities Act"); (2) acquired through employee stock plans or as compensation for services; (3) acquired outside of the United States in reliance on Regulation S of the Securities Act and which cannot be resold within the United States; (4) subject to lockup agreements or similar contractual restrictions; and/or (5) considered "restricted securities" under Rule 144 of the Securities Act. The Exchange intends to amend the definition of "unrestricted securities" to include securities that are not "restricted securities", and "unrestricted publicly-held shares" to include publicly held shares excluding the newly defined "unrestricted securities."

The Exchange proposes that all of the existing publicly-held shares requirements in Initial Listing Standards 2 through 4 be replaced with numerically identical requirements that would be measured based on unrestricted publicly-held shares. Furthermore, with respect to Initial Listing Standard 1, the Exchange is proposing that the existing publicly-held shares requirement be replaced with a minimum standard of $15 million.

As a result of these proposed changes, only securities that are freely transferable will be included in the calculation of publicly-held shares when determining whether a company meets the NYSE American's initial listing requirements.

Unrestricted Publicly-Held Shares Requirements for Companies Listing in Connection with an Underwritten Public Offering

For companies listing on the NYSE American in connection with a public offering, shares outstanding prior to such offering held by non-affiliates (i.e. officers, directors or 10% or greater stockholders) are currently counted as publicly-held shares for initial listing purposes and are added to the shares being sold in the public offering.

The Exchange has observed that companies that must rely on outstanding shares held by non-affiliates to meet the market value of publicly-held shares requirement "generally have experienced higher volatility on the date of listing than those of similarly situated companies that meet the requirement solely on the basis of offering proceeds." As a result, the Exchange is proposing that any company seeking to list in connection with an IPO, including listings via American Depository Receipts or other underwritten public offerings, must have a market value of unrestricted publicly-held shares of at least $15 million which must be satisfied from the offering proceeds. Furthermore, similar to Nasdaq Capital Market requirements, the NYSE is proposing that a listing in connection with an IPO or other underwriting offering should be required to have proceeds of at least $15 million based upon the low end of the price range for such offering.

Minimum Stock Price for Initial Listings

Currently, the NYSE requires a minimum market price between $2.00 to $3.00 per share for companies qualifying for listing pursuant to Sections 101(a) through (d) of the NYSE American Company Guide. The Exchange is proposing to amend this requirement to increase the minimum market price to $4.00 per share consistent with rules for companies listing on The Nasdaq Capital Market¹. The proposed $4.00 price is also consistent with the requirement to meet the exception from the definition of "penny stock" set forth in Rule 3a51-1(a)(2) of the Securities Exchange Act. This is because "[t]he Exchange has noted that companies that have listed with a share price of less than $4.00 are more likely over time to trade at abnormally low price levels, which makes them potentially susceptible to manipulation."

Market Capitalization and Stock Price Requirements

NYSE's Initial Listing Standard 3 requires a total market capitalization of $50,0000,000 while Initial Listing Standard 4 requires companies to have either (i) $75,000,000 in total market capitalization or (ii) total assets and total revenue of $75,000,000 each in its last fiscal year, or in two of its last three fiscal years. When applying total market capitalization standards for companies listing through an IPO or other underwritten public offering, the Exchange bases its calculation on the public offering price to determine if a company meets the market capitalization requirement; however, the Initial Listing Standards do not clarify how total market capitalization should be calculated under Standards 3 and 4 for companies that are already publicly traded on the over-the-counter markets ("OTC Markets") or those transferring from another national securities exchange.

The NYSE is proposing to amend such Initial Listing Standards to provide that companies that are already publicly traded on the OTC Markets or transferring from another national securities exchange must have a total market capitalization that meets the applicable requirement for 90 consecutive trading days prior to applying to list and must also meet the proposed $4.00 price requirement as set forth above over the same period.

Key Takeaways

• IPO & Public Offering Requirements: Companies listing in connection with an IPO or other underwritten public offering must have a market value of unrestricted publicly-held shares of at least $15,000,000 which must be satisfied from the offering proceeds. Furthermore, companies should be required to have proceeds of at least $15,000,000 based upon the low end of the price range.
• Higher Minimum Share Price: The Exchange is proposing to increase the minimum market price to $4.00 per share, aligning with Nasdaq standards and SEC rules on penny stocks.
• Market Capitalization Standards: Companies that are already publicly traded on the OTC Markets or transferring from another national securities exchange must have a total market capitalization that meets the applicable requirement for 90 consecutive trading days prior to applying to list and must also meet the proposed $4.00 price requirement as set forth above over the same period when applying to list under Initial Listing Standard 3 or 4.

The new proposed requirements are intended to take effect immediately and will apply to any company that has not been approved for listing by the NYSE at the time the rules take effect. While these changes are designed to address concerns around price manipulation, volatility, and to enhance overall liquidity, they may also create additional hurdles for companies seeking to list on NYSE American.

FFootnotes

1 See Nasdaq Stock Market Rules 5505(a)(1)(A) and (B).

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