Sullivan
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On May 22, 2026, Sullivan & Worcester submitted a supplemental comment letter to the U.S. Securities and Exchange Commission (SEC) in response to Release No. 34-105333; File No. SR-NASDAQ-2026-004, concerning Nasdaq’s proposal to adopt a continued listing requirement mandating that companies maintain a minimum Market Value of Listed Securities of $5 million.

The supplemental letter, authored by partners David Danovitch, Angela GomesBrendan O’Brien and associate Phillip Carnevale, expands upon the firm’s prior comments submitted in February and addresses the SEC’s Order Instituting Proceedings regarding the proposal.

Nasdaq’s proposal would require issuers to maintain at least $5 million in Market Value of Listed Securities for 30 consecutive business days and would impose immediate suspension and delisting for companies that fall below that threshold, without providing a meaningful compliance or cure period.

Sullivan’s comments emphasize that the proposal could unintentionally encourage opportunistic trading activity and disproportionately impact micro-cap and small-cap issuers whose market value is often influenced by factors outside their control, including volatility, investor sentiment and trading dynamics. The letter also highlights the potential harm to retail investors resulting from automatic delisting to over-the-counter markets, including reduced liquidity, transparency and governance protections.

Through its interdisciplinary Small-Firm Task Force, Sullivan continues to draw on its capital markets, regulatory, enforcement and litigation experience to support issuers and investors navigating the evolving regulatory landscape impacting small-cap, micro-cap and mid-market companies.

For these reasons, Sullivan urged the SEC to disapprove the proposal unless substantially modified to address the concerns outlined in the firm’s supplemental comments.