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Capstone Holding Corp. (NASDAQ:CAPS) announced Friday that it has agreed with an institutional investor to reduce the conversion price of certain outstanding senior secured convertible notes. According to a statement based on a recent SEC filing, the conversion price for the remaining principal of the July 2025 Convertible Note, totaling $500,744.01, and for $1,772,856.21 of the principal amount of the October 2025 Convertible Note has been lowered to $0.75 per share. The remaining portion of the October 2025 Convertible Note continues to have a conversion price of $1.10 per share. This move comes as InvestingPro data shows the company operates with a significant debt burden of $23.25 million against a market capitalization of just $7.12 million. According to InvestingPro’s Fair Value assessment, the stock is currently fairly valued at its price of $0.91.
The original securities purchase agreement, entered into on July 29, 2025, authorized the issuance of up to $10,909,885 in senior secured convertible notes with an 8.34% original issue discount. The July 2025 Convertible Note was initially issued for approximately $3.27 million with a conversion price that began at $1.72 per share and was later reduced to $1.00. The October 2025 Convertible Note was issued for approximately $3.55 million at a $1.10 conversion price.
Capstone registered a total of 8,388,336 shares of common stock for issuance upon conversion of the notes under effective registration statements on Form S-1.
The adjustment of the conversion price was made pursuant to Section 7(h) of the notes and formalized through a Conversion Price Voluntary Adjustment Notice signed by both parties.
Capstone Holding Corp. is a Delaware-based company listed on the Nasdaq Stock Market. The information in this article is based on a press release statement and the company’s filing with the Securities and Exchange Commission.
In other recent news, Capstone Holding Corp. reported an accelerating demand for natural stone in construction markets, aligning with their expansion strategy in stone distribution. The company is nearing the completion of a significant acquisition, expecting to finalize the purchase of a multi-location stone distributor with $15 million in annual revenue by mid-December. This acquisition is anticipated to immediately boost both revenue and EBITDA. To support this acquisition, Capstone has drawn $3.25 million from its convertible note facility. The company has reaffirmed its acquisition-focused growth strategy, which has been validated by similar moves from industry giants like Lowe’s and Home Depot. Capstone aims to reach a $100 million annualized revenue run rate by the first quarter of 2026. The company’s national distribution platform has expanded through strategic acquisitions, now covering 31 states.
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