The acquisition is transformative relative to Cycurion's $6M market cap, adding a revenue stream nearly equal to its own valuation. Monitor closing conditions and due diligence completion in early July. Historical trading on CYCU filings has been poor (13% win rate at T+20), but this event is materially different in kind. If the deal closes, expect significant revenue uplift and potential re-rating.
Price Chart
Executive Summary
Cycurion entered into an Asset Purchase Agreement to acquire Kustom Entertainment's video-solutions division (Digital Ally brand) for $1.25M cash, a $4.25M secured note, up to $1.0M earnout, and warrants for 2M shares. The target has ~$5.1M annual revenue and ~$8.0M backlog, adding ~1,000 law enforcement clients. Closing expected early July 2026, subject to conditions.
Key Facts
- Total consideration: $1.25M cash + $4.25M promissory note (7%, 3yr) + up to $1.0M earnout + warrants for 2,000,000 shares at $2.80
- Target generated ~$5.1M annual revenue and holds ~$8.0M contracted backlog
- Acquisition adds ~1,000 new customer relationships, primarily police departments and municipal agencies
- Portfolio of ~58 patents covering video surveillance, evidence management, and integration technologies
- Transaction structured as asset purchase with minimal immediate equity dilution; closing expected early July 2026
Financial Impact
Adds ~$5.1M annual revenue and ~$8.0M backlog; total consideration ~$5.5M cash/debt plus earnout and warrants; Cycurion market cap is ~$6M, making this transformative in scale
Risk Factors
- Deal subject to multiple conditions precedent including due diligence, board approvals, and carve-out financials — may not close
- Integration risk and execution on cross-selling synergies uncertain
- Warrants for 2M shares at $2.80 create potential future dilution if exercised
- Historical stock performance on prior CYCU filings has been negative on average
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 5 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001628280-26-046358 |
| Exhibit: exhibit991june292026.htm | 0001628280-26-046358 |
| Document: 0001628280-26-046358-index-headers.html | 0001628280-26-046358 |
| Document: 0001628280-26-046358-index.html | 0001628280-26-046358 |
| Document: 0001628280-26-046358.txt | 0001628280-26-046358 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Sep 8, 2026 24d ago | 8-K | $3.51 $3.36 | ▼ −4.27% | ▼ −3.61% | $3.82 (+8.83%) |
Aug 28, 2026 5w ago | 8-K | $3.85 $3.54 | ▼ −8.05% | ▼ −8.16% | $3.82 (−0.78%) |
Aug 28, 2026 5w ago | 8-K | $3.85 $3.54 | ▼ −8.05% | ▼ −8.16% | $3.82 (−0.78%) |
Aug 26, 2026 5w ago | Press Release | $0.4586 $3.03 | ▼ −560.71% | ▼ −560.83% | $3.82 (−732.97%) |
Aug 26, 2026 5w ago | Press Release | $0.4586 $3.03 | ▲ +560.71% | ▲ +560.83% | $3.82 (+732.97%) |
Aug 19, 2026 6w ago | 8-K | $5.54 $3.67 | ▼ −33.67% | ▼ −33.28% | $3.82 (−31.00%) |
Aug 18, 2026 6w ago | 8-K | $5.54 $3.67 | ▼ −33.67% | ▼ −33.28% | $3.82 (−31.00%) |
Aug 14, 2026 7w ago | 8-K | $0.6850 $0.6539 | ▼ −4.54% | ▼ −3.17% | $3.82 (+457.66%) |
Aug 14, 2026 7w ago | Press Release | $0.6850 $0.6539 | ▼ −4.54% | ▼ −3.17% | $3.82 (+457.66%) |
Aug 12, 2026 7w ago | 8-K | $4.96 $5.54 | ▲ +11.61% | ▲ +12.06% | $3.82 (−22.98%) |
US Market Status
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