Kustom Entertainment (NASDAQ:KUST) and Cycurion (NASDAQ:CYCU) have announced a definitive move to restructure the terms of their previously proposed transaction regarding Kustom’s legacy video solutions segment.
Under the revised agreement, Cycurion will acquire the business for an aggregate purchase price of $5,500,000, with both parties targeting a closing date on or before June 30, 2026.
The deal is structured to provide Kustom with immediate liquidity while offering Cycurion a manageable payment schedule.
The consideration consists of a $1,250,000 cash down payment and a $4,250,000 secured promissory note.
The note carries a 7% interest rate and is payable over 36 months.
Additionally, Kustom will receive 2,000,000 warrants exercisable at $2.80 per share, valid for two years following their registration.
To align the interests of both firms post-closing, the agreement includes a performance-based earn-out and clawback provision capped at $1,000,000.
This mechanism ensures that the final valuation reflects the actual performance of the video segment under Cycurion’s management.