Shares of Cycurion (CYCU) tumbled 10.7% to $0.29 after Kustom Entertainment disclosed amended terms to the long-delayed sale of its legacy video surveillance and body-camera business — a deal that just got meaningfully costlier for an already cash-strapped buyer.

  • The Price Tag Jumped and Now Includes Immediate Cash Out the Door. The amended agreement increases total deal valuation to $6.1 million and injects immediate non-refundable capital directly into Kustom. That's up from the original structure of $1.25 million cash at closing plus a $4.25 million secured promissory note at 7% interest.

Kustom now captures $250,000 in immediate non-refundable capital — money Cycurion parts with before the deal even closes. For a company with a market cap around $3.6 million and trailing twelve-month revenue of $15.1 million at a razor-thin 10.7% gross margin , every dollar of upfront cash burns a larger hole.

  • Warrants Disappeared, but a Costly Preferred Stock Took Their Place. Kustom canceled the previously planned 2,000,000 warrants at a $2.80 strike price and replaced them with new Series H Preferred Stock carrying a 12% annual cumulative dividend paid quarterly in Cycurion common shares.

The preferred converts at $1.45 per share — roughly five times the current stock price. That means continuous share issuance to fund the dividend, steadily diluting existing holders (meaning each investor's ownership slice shrinks over time). This is the opposite of the "non-dilutive" deal Cycurion originally pitched.

  • The Closing Date Slipped Again, Raising Execution Questions. The deal was first announced in January, targeted for June , then pushed to early July. The outside closing date is now extended to September 15, 2026. Each delay adds uncertainty about whether the roughly $5.1 million in annual revenue and $8 million contracted backlog will actually materialize on Cycurion's books — and whether customers stick around through a prolonged transition.

  • A Nasdaq Delisting Fight Looms in the Background. Cycurion recently received a Nasdaq delisting determination letter and intends to appeal.

The stock has dropped over 77% year-to-date. Bolting on a complex, costlier acquisition while fighting to keep a listing creates compounding risk for shareholders who are already deep underwater.

The bottom line: what started as a disciplined bolt-on is morphing into a dilution machine for a micro-cap company running out of margin for error.