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2025-01415 — Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Amendment No. 2 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 2, To Amend Section 802.01C of the NYSE Listed Company Manual (Price Criteria for Capital or Common Stock) To Restrict the Use of Reverse Stock Splits in Certain Circumstances
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January 22, 2025
Type:Notice
Citation:90 FR 7715
Reading Time:about 24 minutes
The Securities and Exchange Commission (SEC) has approved a rule change by the New York Stock Exchange (NYSE) that restricts certain companies from using reverse stock splits to continue being listed on the exchange. This new rule targets companies that repeatedly use reverse stock splits, especially if they have done so in the past year or have a significant reverse split history in the last two years. The SEC believes this rule will help protect investors by ensuring that companies listed on the exchange are financially stable and suitable for continuing public trading. Companies can still appeal if they are delisted due to these new rules.
Simple Explanation
The SEC has decided that some companies can't keep using a trick called "reverse stock splits" too many times just to stay in the NYSE club because they want to make sure these companies are strong enough to be trusted with people’s money. If a company thinks this decision is not fair, it can try to talk it over and maybe get back on the list.
2025-01621 — Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Order Granting Approval of a Proposed Rule Change To Modify the Application of the Minimum Bid Price Compliance Periods and the Delisting Appeals Process for Bid Price Non-Compliance in Listing Rules 5810 and 5815 Under Certain Circumstances
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January 23, 2025
Type:Notice
Citation:90 FR 8081
Reading Time:about 38 minutes
The Securities and Exchange Commission (SEC) has approved rule changes proposed by Nasdaq to enhance the enforcement of listing standards for companies trading on its exchange. The approved changes involve the suspension of trading for companies that have not met the minimum bid price requirement after a second compliance period, even if they appeal the decision. Additionally, Nasdaq will not allow a compliance period for companies that fail to meet the bid price requirement within one year of a reverse stock split. These changes are intended to protect investors by reducing the risk of manipulation and ensuring the integrity of the stock market, particularly by addressing issues with companies that repeatedly fail to meet listing standards.
Simple Explanation
Nasdaq has made a new rule that says if a company's stock price is too low for too long, the company can't trade its stock on the exchange anymore. This rule helps make sure everything is fair and keeps the stock market honest and safe for everyone.

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