Capstone Retires $1.9 Million Debt, Decreases Leverage Without Diluting Common Shareholders
Capstone (NASDAQ:CAPS) has successfully executed a strategic debt restructuring, exchanging $1.9 million of Brookstone debt for newly issued non-convertible preferred equity. This transaction strengthens the company's balance sheet by reducing leverage without diluting common shareholders.
The deal results in a $170,000 reduction in 2026 interest expenses. The preferred shares come with an 8% dividend that can be paid-in-kind, include proportional voting rights, and are only redeemable after 7 years or upon a change of control. This restructuring enhances Capstone's financial flexibility to pursue accretive acquisitions while maintaining its existing common share structure.
Capstone (NASDAQ: CAPS) ha eseguito con successo una ristrutturazione strategica del debito, scambiando 1,9 milioni di dollari di debito Brookstone con nuove azioni privilegiate ordinarie non convertibili. Questa operazione rafforza il bilancio riducendo la leva finanziaria senza diluire gli azionisti comuni.
L’accordo comporta una riduzione di 170.000 dollari delle spese per interessi nel 2026. Le azioni privilegiate prevedono un dividendo dell'8% che può essere pagato in natura, includono diritti di voto proporzionali e sono redimibili solo dopo 7 anni o in caso di cambio di controllo. Questa ristrutturazione aumenta la flessibilità finanziaria di Capstone per perseguire acquisizioni ad alto valore aggiunto mantenendo la struttura azionaria ordinaria esistente.
Capstone (NASDAQ: CAPS) ha ejecutado con éxito una reestructuración estratégica de la deuda, intercambiando 1,9 millones de dólares de deuda de Brookstone por nuevas acciones preferentes no convertibles. Esta operación fortalece el balance reduciendo la apalancamiento sin diluir a los accionistas comunes.
El acuerdo resulta en una reducción de 170.000 dólares en los gastos por intereses de 2026. Las acciones preferentes tienen un dividendo del 8% que puede pagarse en especie, incluyen derechos de voto proporcionales y solo son redimibles después de 7 años o ante un cambio de control. Esta reestructuración mejora la flexibilidad financiera de Capstone para perseguir adquisiciones con valor añadido manteniendo su actual estructura de acciones ordinarias.
Capstone (NASDAQ: CAPS)은 Brookstone의 부채 190만 달러를 신발행 비전환 우선주로 교환하는 전략적 부채 재구조화를 성공적으로 수행했습니다. 이 거래는 일반주주를 희석하지 않으면서 레버리지를 줄여 회사의 재무구조를 강화합니다.
거래로 인해 2026년 이자 비용이 17만 달러 감소합니다. 우선주는 8%의 배당금을 현금이 아닌 형태로 지급할 수 있으며 비례 의결권을 포함하고, 지배변경 또는 7년 이후에만 상환 가능합니다. 이번 재구조화는 Capstone이 기존 보통주 구조를 유지하면서 가치 창출형 인수를 추구할 수 있는 재무적 유연성을 강화합니다.
Capstone (NASDAQ: CAPS) a mené à bien une restructuration stratégique de sa dette, en échangeant 1,9 million de dollars de dette Brookstone contre de nouvelles actions privilégiées non convertibles. Cette opération renforce le bilan en réduisant l’endettement sans diluer les actionnaires ordinaires.
L’accord entraîne une réduction de 170 000 dollars des charges d’intérêts en 2026. Les actions privilégiées comportent un dividende de 8% qui peut être payé en nature, incluent des droits de vote proportionnels et ne sont remboursables qu’après 7 ans ou en cas de changement de contrôle. Cette restructuration améliore la flexibilité financière de Capstone pour poursuivre des acquisitions à valeur ajoutée tout en maintenant la structure existante des actions ordinaires.
Capstone (NASDAQ: CAPS) hat erfolgreich eine strategische Schuldenrestrukturierung durchgeführt und 1,9 Mio. USD Brookstone-Schulden gegen neu ausgegebene, nicht wandelbare Vorzugsaktien getauscht. Dieser Schritt stärkt die Bilanz, verringert die Verschuldung, ohne die Stammaktionäre zu verwässern.
Der Deal führt zu einer Reduktion der Zinsausgaben im Jahr 2026 um 170.000 USD. Die Vorzugsaktien weisen eine 8%-Dividende auf, die in natura gezahlt werden kann, beinhalten proportionale Stimmrechte und sind erst nach 7 Jahren oder bei einer Veränderung der Kontrolle rückzahlbar. Diese Umstrukturierung erhöht Capstones finanzielle Flexibilität, um addierende Akquisitionen zu verfolgen und gleichzeitig die bestehende Stammaktienstruktur zu bewahren.
Capstone (المدرجة في NASDAQ: CAPS) أنجزت بنجاح إعادة هيكلة استراتيجية للديون، حيث تم تبادل ديون Brookstone بقيمة 1.9 مليون دولار مقابل أسهم ممتازة غير قابلة للتحويل جديدة. تُعزّز هذه الصفقة الميزانية عن طريق خفض الدين دون تضخيم عدد المساهمين العاديين.
وينتج عن الصفقة خفض قدره 170,000 دولار في مصروفات الفوائد لعام 2026. الأسهم الممتازة تأتي مع توزيعات قدرها 8% يمكن دفعها عينياً، وتمنح حقوق تصويت نسبية، كما أنها قابلة للإعدام فقط بعد 7 سنوات أو في حال تغير التحكم. هذه إعادة الهيكلة تعزز المرونة المالية لـ Capstone لمتابعة عمليات استحواذ تضيف قيمة مع الحفاظ على هيكلها من الأسهم العادية.
Capstone（纳斯达克股票代码：CAPS） 已成功执行战略性债务重组，将 Brookstone 的 190万美元债务兑换为新发行的不可转让优先股。此次交易通过降低杠杆并不稀释普通股股东，来强化公司资产负债表。
交易使 2026 年的利息支出减少了 17万美元。这些优先股附带 8% 的股息，可以以实物方式支付，包含成比例的投票权，且在 7 年后或发生控制权变更时才可赎回。此次重组提升了 Capstone 的财务灵活性，使其在维持现有普通股结构的同时，能够追求具增值潜力的并购。
- Elimination of $1.9 million in debt improves balance sheet strength
- Annual interest expense reduction of $170,000 starting 2026
- No dilution to common shareholders as preferred shares are non-convertible
- Flexible 8% dividend structure with PIK option preserves cash for growth
- Enhanced financial flexibility for pursuing accretive acquisitions
- New preferred shares carry voting rights proportional to economic interest
- 8% dividend rate on preferred shares represents ongoing cost
Insights
Capstone's debt-to-equity swap improves financial flexibility without diluting shareholders, strengthening acquisition capacity while reducing interest burden.
Capstone's $1.9 million debt-for-preferred-equity exchange represents a strategic deleveraging move with several positive financial implications. The transaction eliminates approximately $170,000 in annual interest expense starting in 2026, immediately improving cash flow and profitability metrics. This non-dilutive approach preserves the existing common share count while still reducing leverage - a rare combination in public company restructurings.
The structure includes investor-friendly terms with an 8% dividend coupon that can be paid-in-kind through additional preferred shares, conserving cash for operations and acquisition pursuits. The 7-year redemption restriction aligns investor interests with Capstone's long-term growth trajectory, providing stability to the capital structure.
From a balance sheet perspective, this transaction improves key credit metrics like debt-to-EBITDA and interest coverage ratios, potentially enhancing Capstone's access to favorable financing terms for future acquisitions. While the preferred shares do carry voting rights proportional to economic interest, this appears to be a reasonable concession given the non-convertible nature of the securities.
The fact that this debt was held by a related party suggests possible insider confidence in the company's future prospects, as they've essentially traded a guaranteed debt position for an equity-like position with less protection in bankruptcy scenarios. The transaction's $1.9 million size may seem modest, but for a company with CAPS's market capitalization, this represents meaningful deleveraging that provides increased operational flexibility without the dilution that typically accompanies equity raises.
Transaction Strengthens Balance Sheet and Improves Position for Accretive M&A
NEW YORK CITY, NY / ACCESS Newswire / October 1, 2025 / Capstone Holding Corp.("Capstone" or the "Company") (NASDAQ:CAPS), a national building products distribution platform, today announced the exchange of
Importantly, no new common shares were issued. The preferred equity is non-dilutive, leaving the common share count unchanged and preserving value for existing shareholders.
Key Highlights:
$1.9 Million Debt Retired: All targeted Brookstone debt was exchanged for preferred equity. Capstone's funded debt drops by$1.9 million - a significant decrease in leverage - which will boost credit metrics.No Dilution to Common Stockholders: Preferred shares are not convertible into common stock, ensuring no dilution to current equity owners.
Dividend Structure: Dividends accrue at an
8% coupon and, at the Company's election, can be paid-in-kind (PIK) by issuing additional preferred shares, preserving cash to fund growth.Voting Rights: Preferred shares do have a vote, proportional to their economic interest.
Long-Term Alignment: Preferred equity is redeemable only in the event of a change of control or after 7 years, aligning investor interest with Capstone's multi-year growth plan.
"This disciplined debt reduction further improves our financial position and preserves capital for growth," said Matthew Lipman, CEO. "By removing
Capstone's management noted that the exchange affirms its commitment to prudent capital structure management. The transaction lowers financial risk and signals confidence in the Company's long-term cash flows.
Additional details will be available in Capstone's Form 8-K that we expect to file with the Securities and Exchange Commission on October 1, 2025.
About Capstone Holding Corp.
Capstone Holding Corp. (NASDAQ:CAPS) is a diversified platform of building products businesses focused on distribution, brand ownership, and acquisition. Through its Instone subsidiary, Capstone serves 31 U.S. states, offering proprietary stone veneer, hardscape materials, and modular masonry systems. The Company's strategy combines disciplined M&A, operational efficiency, and a growing portfolio of owned brands to build a scalable and durable platform.
Investor Contact
Investor Relations
Capstone Holding Corp.
investors@capstoneholdingcorp.com
www.capstoneholdingcorp.com
Forward-Looking Statements
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements relate to future events and performance, including guidance regarding possible high-value acquisitions, revenue and EBITDA targets, M&A strategy, use of capital, and operating outlook. Actual results may differ materially from those projected due to a range of factors, including but not limited to acquisition timing, macroeconomic conditions, and execution risks. Please review the Company's filings with the SEC for a full discussion of risk factors. Capstone undertakes no obligation to revise forward-looking statements except as required by law.
SOURCE: Capstone Holding Corp.
View the original press release on ACCESS Newswire
FAQ
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