Capstone Holding Corp.

We are reporting the following information in lieu of reporting on a Current Report on Form8-K under Item3.02, Unregistered Sales of Equity Securities and Item5.02, Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On* August 7, 2026,the Company granted4,809,212* shares of common stock as restricted stock awards toeleven executive officers and directors under the Capstone Holding Corp.2025 Stock Incentive Plan, as amended. Awards to management participants vest on athree-year cliff on* August 7, 2029,*and awards to non-employee directors vest only if the recipient’s service terminates by reason of death or disability, by action of the Company other than for cause (including a failure to be nominated for re-election), or by a failure to be re-elected by the stockholders, and are forfeited if the recipient’s service terminates for any other reason.

We are reporting the following information in lieu of reporting on a Current Report on Form8-K under Item3.03, Material Modification to Rights of Security Holders and Item5.03, Amendments to Articles of Incorporation or Bylaws.

On* August 7, 2026,the Board of Directors approved, and the holder of the Series B Preferred Stock consented to, an amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series B Preferred Stock (the “Amendment to Series B Preferred COD”). The Company filed the Amendment to Series B Preferred COD with the Delaware Secretary of State on August 10, 2026.*The amendment provides that, upon any stock split, reverse stock split, combination or similar recapitalization of the Common Stock, the number of votes per share of the Series B Preferred Stock and the price conditions applicable to its conversion adjust proportionately, so that the relative voting power and the conversion economics of the Series B Preferred Stock are unchanged by any such transaction.

The foregoing doesnot purport to be a complete description of the Amendment to Series B Preferred COD, and such description is qualified in its entirety by reference to the full text of the Amendment to Series B Preferred COD, a copy of which is filed as Exhibit3.1 to this Quarterly Report on Form 10-Q and is incorporated herein by reference.

We are reporting the following information in lieu of reporting on a Current Report on Form8-K under Item5.07, Submission of Matters to a Vote of Security Holders.

On* August 7,2026, certain stockholders (collectively, the “Consenting Stockholders”) of the Company holding at least a majority of the voting power of the Company’s outstanding shares of capital stock entitled to vote, including the majority of each of (i) the Common Stock shares outstanding, (ii) the Series B Preferred Stock shares outstanding, and (c) the Series Z Preferred Stock shares outstanding, adopted resolutions by written consent (the “Written Consent”) in lieu of a meeting of stockholders to approvetwo* matters.

Thefirst matter approved is the filing ofone or more amendments to the Company’s Certificate of Incorporation, as amended, to decrease the number of authorized shares of Common Stock and/or preferred stock, at such time and in such amounts as the Board of Directors* maydetermine, including in connection with any reverse stock split. The approval authorizes the amendments but doesnot effect them. As of the date of this report, the Company hasnot* determined the reduced number of authorized shares andno certificate of amendment has been filed. Any such amendment will be effected, if at all, at such time and in such amounts as the Board of Directors* maydetermine, andnot* before a information statement on Schedule14C (a “Schedule14C”) has been filed with the SEC and mailed to stockholders and the applicable waiting period has elapsed.

Thesecond matter approved is the settlement of the remaining shares of Series Z Preferred Stock and accrued management fees payable to Brookstone Partners IAC, Inc. (an entity affiliated with Matthew Lipman, the Company’s Chief Executive Officer, and Michael Toporek, the Chairman of the Board) throughone or more further exchanges. With each exchange occurring at a price per share equal to103% of the Nasdaq Official Closing Price on the trading day immediately preceding consummation, inone or more exchanges at any time on or prior to* August 7, 2027,covering the issuance of up to15,750,000* shares of Common Stock in the aggregate, with each recipient executing an18-month lock-up agreement. Any such exchange willnot be effected before a Schedule14C has been filed with the SEC and mailed to stockholders and the applicable waiting period has elapsed.

In connection with both matters, the Company will file with the U.S. Securities and Exchange Commission a Schedule14C that will be mailed to all holders of record of the Company’s voting capital stock as of the close of business on* August 7, 2026 (*the “Record Date”).

The Consenting Stockholders are, collectively, BPA XIV, LLC, Nectarine Management, LLC, Brookstone Partners Acquisition XXI Corporation, BP Peptides, LLC, Gordon Rocks, Inc. (an entity controlled by Gordon Strout, a member of the Board), each member of the Board and named executive officer listed in the Company’s Annual Report on Form10-K for the year ended* December 31, 2025,andtwo* employees of TotalStone, LLC. As of the close of business on the Record Date, the Consenting Stockholders together held10,536,050 shares of Common Stock (representing approximately51.2% of the shares outstanding) and all of the shares of Series B Preferred Stock and Series Z Preferred Stock outstanding, representing approximately56.4% of the voting power of our outstanding shares of capital stock entitled to vote.

Insider trading arrangements and policies.

During the quarter ended* June 30, 2026*,no director or officer of the Company adopted or terminated any “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item408(a) of Regulation S-K.