{"url_path":"/sec/cycu/8-k/2026-06-30/item-8-01","section_key":"item-8-01","section_title":"Item 8.01 Other Events.**","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-06-30","source_url":"https://www.sec.gov/Archives/edgar/data/1868419/0001493152-26-031333-index.html","accession_number":"0001493152-26-031333","cik":"0001868419","ticker":"CYCU","issuer_name":"Cycurion, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1868419/0001493152-26-031333-index.html","primary_entity_key":"0001868419","primary_entity_name":"Cycurion, Inc."},"word_count":1371,"has_tables":true,"body_markdown":"**Item\n8.01 Other Events.**\n\n \n\nOn\nJune 29, 2026, the Company issued a press release announcing its entry into the Asset Purchase Agreement with Kustom, pursuant to which\nthe Company agreed to acquire substantially all of the assets comprising Kustom’s video-solutions business. A copy of the press\nrelease is furnished as Exhibit 99.1 to this Current Report on Form 8-K.\n\n \n\n \n\n \n\n \n\n**Assignment\nand Assumption Agreement**\n\n \n\nPursuant\nto the Assignment and Assumption Agreement, Kustom will assign to the Company certain tangible and intangible assets associated with\nthe acquired business, and the Company will assume only those liabilities expressly identified as Assumed Liabilities under the Asset\nPurchase Agreement. The agreement further clarifies that the Company will not assume liabilities other than those specifically assumed\nunder the Asset Purchase Agreement.\n\n \n\n**Intellectual\nProperty Assignment Agreement**\n\n \n\nPursuant\nto the Intellectual Property Assignment Agreement, Kustom will assign to the Company specified intellectual property assets used in the\nacquired business, including certain patents, trademarks, domain names and related intellectual property rights, together with associated\ngoodwill and rights to enforce such intellectual property. The agreement also provides for additional actions following closing to perfect\nand record the Company’s ownership of the assigned intellectual property assets.\n\n \n\n**Bill\nof Sale**\n\n \n\nPursuant\nto the Bill of Sale, Kustom will transfer, assign and convey to the Company all of Kustom’s right, title and interest in and to\nthe Acquired Assets acquired under the Asset Purchase Agreement, free and clear of liens, subject to the terms of the Asset Purchase\nAgreement. The Bill of Sale appoints the Company as Kustom’s attorney-in-fact for the limited purpose of collecting and obtaining\npossession of transferred assets and confirms that the Company will not assume any liabilities except those expressly assumed under the\nAsset Purchase Agreement.\n\n \n\n**Non-Competition\nand Non-Solicitation Agreement**\n\n \n\nPursuant\nto the Non-Competition and Non-Solicitation Agreement, Kustom has agreed that, for a period of three years following the closing, it\nwill not directly or indirectly engage in, invest in or otherwise participate in a business that competes with the acquired video-solutions\nbusiness, including businesses involving body-worn cameras, in-car video systems, mobile video surveillance technologies and digital\nevidence management solutions. Kustom has also agreed during such period not to solicit employees, customers or vendors of the acquired\nbusiness and not to disparage the Company or the acquired business. The agreement provides the Company with customary equitable remedies,\nincluding injunctive relief, in the event of a violation of the restrictive covenants.\n\n \n\n**Key\nEmployment Agreement**\n\n** **\n\nPursuant\nto the Key Employment Agreement, the Company will employ certain key employees of the acquired video-solutions business following closing.\nThe agreement provides for an annual base salary, participation in the Company’s benefit plans, eligibility for annual bonus opportunities,\na sign-on bonus, and a grant of restricted stock units that vest over a three-year period, subject to Board approval and the applicable\nequity award agreement. Employment is at-will, and the employee may receive severance equal to three months of base salary if terminated\nby the Company without Cause, subject to execution of a customary release of claims. The employee will also be required to enter into\ncustomary confidentiality, intellectual property assignment, and restrictive covenant agreements, and the employment offer is contingent\nupon the closing of the acquisition transaction and satisfaction of customary onboarding requirements.\n\n \n\n**Essential\nEmployment Agreement**\n\n** **\n\nPursuant\nto the Essential Employment Agreement, the Company will employ certain essential employees of the acquired video-solutions business following\nclosing. The agreement provides for an annual base salary, participation in the Company’s benefit plans, paid time off, holiday\nbenefits, and other customary at-will employment terms. As a condition of employment, the employee will be required to execute the Company’s\nconfidentiality, intellectual property assignment, and restrictive covenant agreements.\n\n \n\n**Secured\nPromissory Note**\n\n \n\nPursuant\nto the Secured Promissory Note, the Company will issue to Kustom a promissory note in the original principal amount of $4.25 million\nbearing interest at a fixed rate of 7.0% per annum. The note provides for thirty-six monthly payments, including an initial six-month\ninterest-only period, and may be prepaid without penalty, subject to certain principal-reduction provisions applicable to early repayment.\nThe note is secured by a first-priority security interest in the Acquired Assets and includes customary default and acceleration provisions.\n\n \n\n \n\n \n\n \n\n**Security\nAgreement**\n\n \n\nPursuant\nto the Security Agreement, the Company will grant Kustom a first-priority security interest in the Acquired Assets acquired, together\nwith the products and proceeds thereof, as collateral for the Company’s obligations under the Secured Promissory Note. The collateral\nis expressly limited to the Acquired Assets and does not include other Company assets, equity interests or unrelated business operations.\nThe Security Agreement permits Kustom to perfect its security interest through UCC filings and provides customary secured creditor. The\nSecurity Agreement terminates automatically upon indefeasible payment in full of the obligations secured thereby.\n\n \n\n**Warrant\nAgreement**\n\n \n\nPursuant\nto the Warrant Agreement, the Company will issue to Kustom a warrant to purchase up to 2,000,000 shares of the Company’s common\nstock at an exercise price of $2.80 per share. The warrant will become exercisable upon the effectiveness of a registration statement\ncovering the resale of the warrant shares and will remain exercisable for a two-year period thereafter. The warrant contains customary\nanti-dilution protections for stock splits, stock dividends, reclassifications and certain extraordinary transactions, as well as cashless\nexercise rights if a registration statement is unavailable. The warrant also includes beneficial ownership limitations that generally\nprohibit Kustom from exercising the warrant to the extent such exercise would cause Kustom to beneficially own more than 4.99% of the\nCompany’s outstanding common stock, subject to certain adjustment rights.\n\n \n\n**Registration\nRights Agreement**\n\n** **\n\nPursuant\nto the Registration Rights Agreement, the Company has agreed to file, within 60 days following closing, a registration statement covering\nthe resale of the shares issuable under the Warrant Agreement and other registrable securities issued in connection with the acquisition\nand to use reasonable best efforts to have such registration statement declared effective within 90 days following closing. The Company\nis obligated to keep the registration statement effective until the earlier of the date on which Kustom may freely resell the securities\nunder Rule 144 without restriction or the date all registrable securities have been sold.\n\n \n\n**Earnout\nand Clawback Agreement**\n\n \n\nPursuant\nto the Earnout and Clawback Agreement, the parties agreed to a revenue-based contingent purchase price adjustment mechanism tied to the\npost-closing performance of the acquired Video Solutions Business during fiscal years 2026 and 2027. Kustom may become entitled to earnout\npayments of up to $500,000 per year, and $1.0 million in the aggregate, if annual revenue exceeds specified target amounts. Conversely,\nthe Company may be entitled to clawback payments of up to $500,000 per year, and $1.0 million in the aggregate, if annual revenue falls\nmore than 20% below specified revenue targets, subject to certain thresholds, limitations, offsets and dispute resolution procedures.\nRevenue determinations are based on U.S. GAAP and are subject to review and dispute procedures set forth in the agreement.\n\n** **\n\n**Leak-Out\nAgreement**\n\n \n\nPursuant\nto the Leak-Out Agreement, Kustom agreed that, following the effectiveness of a registration statement covering the warrant shares issuable\nunder the Warrant Agreement, its exercise and resale of such warrant shares will be subject to certain volume limitations for a period\nof twelve months. During the leak-out period, Kustom generally may not sell on any trading day more than 10% of the Company’s reported\ntrading volume for the immediately preceding trading day, subject to applicable securities laws and the terms of the agreement. The Leak-Out\nAgreement also prohibits certain short sales and hedging transactions with respect to the warrant shares and permits the Company, under\nspecified circumstances, to modify, suspend or terminate the leak-out restrictions.\n\n \n\n**Conditions\nPrecedent Agreement**\n\n \n\nPursuant\nto the Conditions Precedent Agreement, the parties agreed that the closing of the asset acquisition remains subject to the satisfaction\nor waiver of certain additional conditions, including completion of due diligence review, reconciliation of financial information and\nprojections, delivery of carve-out financial statements and supporting records, receipt of required corporate approvals, cooperation\nfrom Kustom’s accounting advisors, execution of employment and related agreements with key personnel, delivery of specified transaction\ndocuments, accuracy of representations and warranties, absence of a material adverse effect on the acquired business, receipt of required\nthird-party consents, and the Company’s determination that the financial records are sufficient to satisfy anticipated SEC reporting\nrequirements."}