Kustom Entertainment closes $6.1M divestiture of video solutions business to Cycurion

KUSTOM ENTERTAINMENT, INC.

Closed sale of video solutions assets to Cycurion (CYCU) for $1.25M cash, $4.25M secured note (7% interest, 3-year term), and $600K Series H Preferred (12% cumulative dividend).
Earnout potential up to $1M based on 2026/2027 revenue targets ($5.5M/$5.8M); symmetrical clawback if revenue falls >20% below target.
Company pivots to pure-play live entertainment and ticketing; plans to expand Country Stampede festival to 35,000 capacity in 2027.
Pro forma balance sheet shows $2.47M cash, $4.63M notes receivable, and $305K investment in Cycurion preferred stock post-divestiture.
Amended ELOC purchase agreement with investor to adjust maximum share purchases based on beneficial ownership limitation.

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