Y’all Street Plays by Familiar Rules — With a Few Twists

For the first time in more than two decades, a newly established and fully integrated national securities exchange has commenced operations, offering an alternative to the NYSE- and Nasdaq-dominated US listings market. The Texas Stock Exchange (TXSE), headquartered in Dallas and marketed as “Y’all Street,” received SEC approval in September 2025, commenced live trading in July and began primary corporate listings in October.

TXSE has entered a listings market long dominated by the New York Stock Exchange (NYSE) and Nasdaq Stock Market (Nasdaq), but it does so within the same federal regulatory framework. All three are self-regulatory organizations registered as national securities exchanges under the Securities Exchange Act of 1934, and listed companies remain subject to applicable federal requirements, including those under the Sarbanes-Oxley Act, Dodd-Frank Act and SEC disclosure rules.

In approving TXSE, the SEC found its initial and continued-listing standards and corporate governance requirements to be “substantially similar” to those of established national securities exchanges. TXSE’s framework largely mirrors familiar NYSE and Nasdaq requirements, potentially allowing issuers to list or dual-list without materially restructuring their existing governance practices. But there are notable differences, including TXSE’s single listing tier, pre-clearance process and proposed approach to voting uninstructed broker shares.    

Listing process & initial standards

Companies seeking to list on TXSE, NYSE or Nasdaq must satisfy the applicable eligibility requirements and complete the exchange’s listing process. While the exchanges follow broadly similar frameworks, TXSE formalizes its front-end review through a mandatory confidential pre-application eligibility process.

Under TXSE Rule 16.201, TXSE conducts a confidential pre-application review, at no cost, to determine whether a company is eligible to list. If TXSE determines that the company is eligible, it issues a clearance letter that remains valid for nine months. The company may then execute a listing agreement and submit its original listing application, which TXSE evaluates against its applicable quantitative listing standards.

The process resembles NYSE’s preliminary confidential eligibility review, after which an issuer may receive pre-clearance to proceed with its formal listing application. Nasdaq similarly requires a listing application and agreement, along with a corporate governance certification addressing matters like board and committee composition. All three exchanges retain discretion in determining whether an applicant is ultimately suitable for listing, but TXSE’s mandatory pre-application review provides issuers with an eligibility determination before they proceed through the formal listing process.

TXSE also requires four registered and active market makers for an initial listing, subject to exceptions for companies meeting certain financial thresholds. The requirement is broadly comparable to Nasdaq’s market-maker requirements, while NYSE’s designated market-maker model does not impose an equivalent numeric requirement.

Unlike Nasdaq and NYSE, TXSE has adopted a single listing tier, with quantitative standards generally comparable to the incumbents’ upper-tier markets. For domestic common stock, TXSE generally requires 400 round-lot holders and 1.1 million publicly held shares. The required market value of publicly held shares is generally $40 million for companies listing in connection with an IPO, spin-off, affiliated-company test or initial firm commitment underwritten public offering and $100 million for other companies. Its financial requirements are based on either an earnings test or a global market capitalization test under TXSE Rule 16.310(c).

That single-tier structure generally aligns with the incumbents’ upper-tier requirements, which may make the exchange less accessible to smaller issuers that would otherwise qualify for Nasdaq’s Capital Market.

Continued-listing & dual listings

TXSE’s continued-listing standards for common stock are set forth in Rule 16.320, with deficiency and delisting procedures addressed in Rule Series 16.500. Like NYSE and Nasdaq, TXSE generally applies a $1 minimum bid price requirement for continued-listing. Under TXSE Rule 16.320(b)(1), a company falls below the applicable compliance standard if its average bid price is less than $1 over a consecutive 30-trading-day period.

TXSE also maintains continued-listing requirements relating to shareholder distribution, publicly held shares, market capitalization, shareholders’ equity and market makers. For example, a company is generally below compliance if its average global market capitalization over a consecutive 30-trading-day period falls below $50 million while shareholders’ equity is also below $50 million. TXSE will also generally initiate suspension and delisting procedures if a company listed under specified financial standards has average global market capitalization below $15 million over a consecutive 30-trading-day period.

TXSE’s continued-listing framework is therefore broadly comparable to the incumbent exchanges, although the specific quantitative standards and deficiency procedures should be considered by issuers evaluating a primary or dual listing.

On that score, TXSE permits companies listed on another national securities exchange to dual-list on TXSE under Rule 16.205, allowing an issuer to add a TXSE listing without first transferring its primary listing from NYSE or Nasdaq. TXSE’s framework also contemplates uplisting from the over-the-counter market, although an issuer must satisfy the applicable initial listing standards.

For existing public companies, dual listing may provide a way to evaluate TXSE while maintaining an established NYSE or Nasdaq listing. Satisfying TXSE’s quantitative and governance requirements is only part of the analysis. Issuers considering a dual listing or transfer should also evaluate factors such as trading liquidity, investor familiarity and the operational implications of maintaining listings on multiple exchanges. These considerations may be particularly relevant while TXSE develops its listings market and establishes a track record as a new exchange.

Foreign private issuers

All three exchanges accommodate foreign private issuers (FPIs), but TXSE’s alternative listing standards are expressly designed for “major non-US companies.” Under TXSE Rule 16.312, an FPI may qualify under either TXSE’s domestic listing standards or its alternative FPI standards.

The alternative standards require a broad, liquid market for the company’s securities and heightened distribution thresholds, including 5,000 holders of 100 or more shares worldwide, 2.5 million publicly held shares and generally $100 million in market value of publicly held shares. An FPI must also satisfy one of several financial tests based on earnings, global market capitalization, revenue, cash flow or affiliation with another listed company. These requirements are more stringent than TXSE’s domestic listing standards and reinforce the exchange’s focus on larger foreign issuers.

TXSE also requires FPIs to disclose interim financial information on Form 6-K at least semiannually under Rule 16.312(a)(7), consistent with Nasdaq’s approach. It subjects FPIs seeking to list following a reverse merger to additional requirements under Rule 16.312(b)(5). NYSE and Nasdaq impose additional listing requirements on reverse-merger companies, including satisfaction of applicable initial listing standards and specified trading history, reporting and minimum price requirements. TXSE also retains discretion to impose more stringent requirements based on the circumstances of a particular applicant, so a reverse-merger company remains subject to TXSE’s applicable listing requirements notwithstanding the manner in which it became public.

Like NYSE and Nasdaq, TXSE generally permits FPIs to follow home-country corporate governance practices in lieu of certain exchange requirements. Under TXSE’s framework, an FPI may rely on home-country practices for many requirements under Rule Series 16.400, as well as certain director compensation disclosure and annual and interim report distribution requirements, subject to specified exceptions.

Nasdaq similarly permits FPIs to follow home-country practices in lieu of many requirements under its Rule 5600 Series, while preserving requirements relating to matters such as audit committee independence under Exchange Act Rule 10A-3, notification of material noncompliance, voting rights and clawbacks. NYSE provides a comparable accommodation under Section 303A, subject to exceptions that include Rule 10A-3 audit committee requirements, disclosure of significant differences from US corporate governance practices, notification of material noncompliance and clawback requirements. An FPI relying on home-country practices should determine which exchange requirements remain mandatory notwithstanding the exemption; TXSE and Nasdaq require supporting certifications from independent home-country counsel, while NYSE requires FPIs to disclose significant differences between their corporate governance practices and those applicable to domestic NYSE-listed companies.

Opinion

Making It Easier to Go Public Isn’t the Same as Making It Easier to Be Public

by Kyle Jeziorski

July 17, 2026

Investors won’t ignore a company’s lack of quarterly reporting and the controls that come along with it

Read moreDetails

Corporate governance requirements

TXSE’s corporate governance requirements under Rule Series 16.400 largely track those of the incumbent exchanges. Its audit committee requirements generally follow Nasdaq, its internal audit function parallels NYSE and its exemptions and phase-in provisions generally track Nasdaq. Like NYSE and Nasdaq, TXSE permits newly public companies to phase in certain board and committee independence requirements for up to one year.

The following table compares certain core governance requirements:

For issuers already aware of Nasdaq’s governance framework, TXSE’s requirements should be relatively familiar, particularly with respect to board and committee independence, exemptions and phase-in periods. NYSE retains certain distinctions, including its requirements for a standalone nominating/corporate governance committee and corporate governance guidelines.

TXSE’s shareholder approval requirements under Rule 16.412 also closely resemble Nasdaq’s framework, including its “20% rule.” Both generally require shareholder approval for certain acquisition-related issuances representing 20% or more of pre-transaction common stock or voting power, issuances resulting in a change of control, certain equity compensation plans and certain nonpublic issuances involving 20% or more of pre-transaction common stock or voting power at a price below the applicable minimum price.

NYSE maintains a parallel framework under Section 312.03, requiring shareholder approval for certain related-party issuances, issuances resulting in a change of control and certain issuances representing 20% or more of pre-transaction common stock or voting power. Although the three regimes are broadly comparable, differences remain in the treatment of affiliated-party and acquisition-related issuances. These differences should be considered when structuring acquisitions, private placements and other significant equity issuances.

One potential departure from existing NYSE and Nasdaq governance practices is TXSE’s proposed treatment of broker-held uninstructed shares. Under proposed Rule 13.003, TXSE members brokers holding securities primarily listed on TXSE would vote uninstructed shares in the same proportion as voting instructions received from beneficial owners. For example, if instructed shares are voted 60% in favor and 40% against a proposal, uninstructed shares would be allocated in the same proportion.

The proposal differs from the longstanding broker-voting framework applicable on NYSE and Nasdaq, under which brokers may vote uninstructed shares on certain routine matters but generally may not vote them on nonroutine matters. TXSE has said its proportional approach would eliminate broker discretion, provide consistent treatment of uninstructed shares and help issuers achieve quorum. Currently, the SEC is considering comments from market participants and TXSE before determining whether to approve the proposed rule change, following the close of the public comment and rebuttal periods. Because the rule remains proposed, issuers should monitor its status and consider its potential effect on shareholder voting and quorum if adopted.

Conclusion

TXSE was built to be recognizable. Its listing standards generally align with the incumbents’ upper tiers, while its corporate governance requirements largely track NYSE and Nasdaq. Where TXSE differs, the distinctions are targeted: a single listing tier, a mandatory pre-application review and a proposed proportional approach to voting uninstructed broker shares.

Companies considering a primary or dual listing should evaluate whether they satisfy TXSE’s quantitative standards, map their existing governance practices against TXSE requirements, and identify differences that could affect ongoing compliance. Because TXSE is a new exchange and certain aspects of its framework continue to develop, issuers and their advisers should also confirm applicable requirements against the current TXSE rulebook and SEC filings when evaluating a potential listing.