Transaction Structured to Provide Up to $5.5 Million plus 2,000,000 Warrants to acquire shares of common stock of Cycurion, Inc.; Follows Previously Announced Major Live Music Expansion Partnership with Gilley's Park City
OVERLAND PARK, KS, June 25, 2026 (GLOBE NEWSWIRE) -- Kustom Entertainment, Inc. (Nasdaq: KUST) (the "Company"), a live entertainment and music festival company, today announced it has entered into a binding agreement for the divestiture of its legacy video solutions division to Cycurion, Inc. (NASDAQ: CYCU) ("Cycurion").
This strategic divestiture accelerates Kustom's complete focus on its rapidly growing live event production portfolio and proprietary online ticketing operations, fully aligning corporate resources with its recent rebranding and Nasdaq ticker symbol "KUST."
The transaction represents a key operational milestone in Kustom's planned corporate overhaul, following the divestiture of its medical billing business earlier this year and the Company's recently announced multi-year partnership between its wholly owned subsidiary, Kustom 440, Inc., and Ruffin Properties, LLC, owner of Gilley's Park City ("Gilley's"). Together, these divestitures and the Gilley's partnership position Kustom to expand its live music footprint ahead of the upcoming festival season while continuing to strengthen and grow its online ticketing business, which complements its live event operations.
Transaction Overview
The Cycurion transaction is designed to enhance Kustom's near-term financial flexibility while preserving meaningful long-term equity upside. The consideration includes:
Cash and secured debt consideration: $5.5 million in total consideration, including $1.25 million in upfront cash and a $4.25 million secured promissory note payable over 36 months at 7% interest.
Warrant upside: Kustom will receive 2,000,000 warrants to purchase Cycurion common stock, giving the Company potential upside from Cycurion's future market performance as the legacy video solutions division is integrated into Cycurion's security business.
Timing: The divestiture is expected to close in July 2026, subject to the satisfaction of customary closing conditions.
Value to Shareholders: Based on total consideration of $5.5 million, the transaction equates to approximately $5.33 per estimated current outstanding common share.
The sale of the legacy video segment gives Kustom a leaner operating structure and sharper focus on the full fan experience—from ticket purchase through the final encore—as it pursues an estimated $100 billion global addressable market.