The New York Stock Exchange (Exchange) has recently adopted two rule changes, one to reduce fees for the initial period of a company’s listing on the Exchange and another to formally expand the universe of holders that will be considered in evaluating the listing application of a company located outside of North America (that is, outside of Canada, the United States, and Mexico).
Amended Rule 902.03
Amended Rule 902.03 of the NYSE Listed Company Manual (Manual) provides that effective April 1, 2025, an issuer that lists a primary class of equity securities on the Exchange on or after April 1, 2025, will, for the first five years that the issuer has been listed on the Exchange, be charged only the initial listing fee and the annual listing fee for such class of securities. Rule 902.03 refers to the five-year period as the Limited Fee Exemption Period. For the avoidance of doubt, the rule specifies that during the Limited Fee Exemption Period, the issuer will not be charged any other listing fees associated with:
- The listing of additional shares of the primary class of equity securities (including with respect to shares issued in connection with a stock split or stock dividend)
- The listing of an additional class of common stock, preferred stock, warrants or rights
- The listing of securities convertible into or exchangeable or exercisable for additional securities of the issuer’s primary class of equity securities
- Applications in connection with a Technical Original Listing or reverse stock split
- Applications for changes that involve modification to Exchange records or in relation to a poison pill
An issuer that listed a primary class of equity securities on the Exchange before April 1, 2025, but on or after April 1, 2021, will be entitled to the remaining balance of the five-year limited fee period running from April 1, 2025, until the five-year anniversary of the date on which such company listed its primary class of equity securities on the Exchange.
Amended Rule 102.01B
On May 2, 2025, the Securities and Exchange Commission approved an amendment to Rule 102.01B of the Manual. Rule 102.01A contains listing standards for companies seeking to list on the Exchange, and these standards include specified minimum numbers of stockholders (referred to as stockholder distribution requirements).
Amended Rule 102.B now provides that when evaluating an issuer located outside of North America (i) whose securities are not listed on any other regulated stock exchange applying, (ii) and that is applying to list equity securities in connection with its initial public offering, the Exchange will include all stockholders on a global basis for the purpose of applying the stockholder distribution requirements.
Prior to this amendment, the Exchange had discretion to include stockholders located outside of North America. In seeking to make this amendment, the Exchange noted that the rules of the Nasdaq Stock Market LLC do not contain any geographic limitation on its total stockholder initial listing criteria.
