CYCURION, INC. (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code Number) AMENDMENT NO. 1 TO THE FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 As filed with the Securities and Exchange Commission on December 2, 2025 File No. 333-291819 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Delaware 7371 86-3720717 (I.R.S. Employer Identification Number) 1640 Boro Place, Suite 420C McLean, VA 22102 (Address, incl ...

As filed with the Securities and Exchange Commission on November 26, 2025 File No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 CYCURION, INC. (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code Number) Delaware 7371 86-3720717 (I.R.S. Employer Identification Number) 1640 Boro Place, Suite 420C McLean, VA 22102 (Address, including zip code, and telephon ...

Business Growth and Strategy - Cycurion reported significant growth driven by organic business solutions and strategic acquisitions in the cybersecurity sector[250]. - The company has established a Master Service Agreement with SLG Innovation, which now represents a majority of Cycurion's revenues[260]. - Cycurion acquired technology assets from Sabres, enhancing its Cycurion Security Platform with Multi-Dimensional Protection, Web Application Firewall, and Bot Mitigation capabilities[265]. - The company anticipates closing the RCR Term Sheet transactions in the second half of the current fiscal year, which involves acquiring accounts receivable from SLG[261][263]. - Cycurion's subsidiaries include Axxum Technologies and Cloudburst Security, which provide cybersecurity services to federal and commercial clients[250][252]. - The company aims to maintain high client retention rates and efficiently acquire customers to support its growth strategy[246]. - The company is focused on expanding its commercial business through enhanced service offerings from the integrated Sabres technology[268]. - Cycurion's growth strategy includes attracting and retaining qualified cybersecurity talent to support its operations and expansion plans[246]. Financial Performance - Cycurion's financial performance in Q3 2025 reflects the impact of strategic acquisitions and operational efficiencies[269]. - Net revenues for the three months ended September 30, 2025, decreased by $0.6 million or 13.9% compared to the same period in 2024, and for the nine months ended September 30, 2025, revenues decreased by $2.1 million or 15.4%[271]. - Gross profit for the three months ended September 30, 2025, was $270,479, resulting in a gross profit percentage of 7.1%, down from 16.1% in the same period of 2024[270]. - Selling, general and administrative expenses increased significantly to $2,719,600 for the three months ended September 30, 2025, compared to $299,233 in the same period of 2024[274]. - Stock compensation expenses rose to $2,082,000 for the three months ended September 30, 2025, reflecting new compensation agreements with executives[275]. - Net cash used in operating activities for the nine months ended September 30, 2025, was $8.8 million, compared to $1.2 million for the same period in 2024, primarily due to additional merger expenses[281]. - As of September 30, 2025, the company had $3.7 million in cash and cash equivalents, an increase of $3.6 million from approximately $38,742 as of December 31, 2024[286]. - The accumulated deficit increased to approximately $21.8 million as of September 30, 2025, compared to $3.2 million as of December 31, 2024, due to net losses during the nine months[285]. - For the nine months ended September 30, 2025, net cash provided by financing activities was $10.8 million, including $5.9 million from an equity line of credit[283]. - The company expects continued significant operating losses for the next few years and is dependent on obtaining additional financing to continue operations[286]. - The total assets increased to approximately $32.3 million as of September 30, 2025, from approximately $25.6 million as of December 31, 2024, primarily due to increases in goodwill[286].

Insider Trading Policy - The Company has adopted an Insider Trading Policy to prevent insider trading and tipping among its directors, officers, and employees[3]. - Violations of the Insider Trading Policy may result in disciplinary actions, including immediate termination and civil or criminal penalties[4]. - The Policy covers all transactions in the Company's securities, including common stock, options, and other types of securities[6]. - Insiders are prohibited from trading in Company Securities while aware of material nonpublic information[15]. - Section 16 Persons must obtain prior approval for all trades in Company Securities from the Compliance Officer[9]. - Trading windows are established for Section 16 Persons and Designated Employees, commencing two business days after public disclosure of financial results[23]. - The Compliance Officer is designated as the Insider Trading Compliance Officer, responsible for reviewing and approving trades[38]. - Insiders may implement a 10b5-1 Plan to trade in Company Securities under specific conditions, including prior approval from the Compliance Officer[32]. - Any Insider who knows of a violation of the Policy must report it immediately to the Compliance Officer[36]. - The Compliance Officer is responsible for determining potential violations of insider trading policies and reporting to the Audit Committee if a violation is concluded or cannot be ruled out[40]. - The Policy requires monitoring and enforcing compliance with all provisions and procedures related to insider trading[41]. - Special trading blackout periods will be designated during which Insiders may not trade in Company Securities[43]. - The Compliance Officer will oversee the training of new and existing personnel on the requirements of the insider trading policy[41]. - Recommendations for revisions to the insider trading policy will be proposed to the board of directors as necessary[43]. - The Company will maintain records of all documents required by the insider trading policy and related SEC reports[43]. - The Compliance Officer may designate individuals to perform duties in their absence[42]. - The Company will ensure that human resources collects and maintains required certifications of employee receipt of the insider trading policy[43]. - The Compliance Officer will respond to inquiries related to the insider trading policy and its procedures[43]. - The Company will administer, monitor, and enforce compliance with all federal, state, and SRO insider trading statutes and regulations[43].

PART I - FINANCIAL INFORMATION This part contains Cycurion, Inc.'s unaudited consolidated financial statements and management's discussion and analysis for the period ended June 30, 2025 [Item 1. Financial Statements - (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20-%20(Unaudited)) This section presents Cycurion, Inc.'s unaudited consolidated financial statements and comprehensive notes for the period ended June 30, 2025 [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) This section presents the company's consolidated financial position, including assets, liabilities, and stockholders' equity Consolidated Balance Sheets | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :-------------- | :---------------- | | Total Assets | $30,736,435 | $25,562,849 | | Total Liabilities | $20,287,582 | $20,177,782 | | Total Stockholders' Equity | $10,448,853 | $3,467,758 | Key Asset Changes (December 31, 2024 vs. June 30, 2025) | Asset Category | December 31, 2024 | June 30, 2025 | | :-------------------------- | :---------------- | :-------------- | | Cash and cash equivalents | $38,742 | $1,013,836 | | Accounts receivable, net | $10,353,708 | $4,118,888 | | Goodwill | $6,592,304 | $20,788,299 | Key Liability Changes (December 31, 2024 vs. June 30, 2025) | Liability Category | December 31, 2024 | June 30, 2025 | | :-------------------------------- | :---------------- | :-------------- | | Factoring liability | $0 | $2,309,160 | | Subordinated convertible promissory notes | $3,333,335 | $0 | | Accounts payable | $3,578,374 | $5,088,223 | [Consolidated Statements of Operations and Comprehensive (Loss)/Income](index=4&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20(Loss)%2FIncome) This section details the company's revenues, expenses, and net loss or income for the specified periods Consolidated Statements of Operations and Comprehensive (Loss)/Income | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Net revenues | $3,887,915 | $5,001,312 | $7,757,965 | $9,244,167 | | Gross profit | $235,937 | $1,024,162 | $913,700 | $1,370,876 | | Operating (loss)/income | $(3,766,077) | $729,372 | $(13,863,581) | $697,109 | | Net (loss)/income attributable to Cycurion | $(5,188,755) | $306,094 | $(15,437,241) | $(6,381) | | Basic EPS | $(0.15) | $0.02 | $(0.58) | $(0.00) | [Consolidated Statements of Cash Flows](index=5&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section outlines the company's cash inflows and outflows from operating, investing, and financing activities Consolidated Statements of Cash Flows (Six Months Ended) | Activity | June 30, 2025 | June 30, 2024 | | :---------------------------------------- | :-------------- | :-------------- | | Net cash used in operating activities | $(6,303,122) | $(850,413) | | Net cash provided by/(used in) investing activities | $1,695,523 | $(592,000) | | Net cash provided by financing activities | $5,580,645 | $1,032,678 | | **Net increase/(decrease) in cash and cash equivalents** | **$973,046** | **$(409,735)** | | Cash and cash equivalents, end of period | $1,013,836 | $198,134 | [Consolidated Statements of Changes in Stockholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) This section presents changes in the company's equity accounts, including common stock, preferred stock, and accumulated deficit - **Total Stockholders' Equity** increased from **$3,467,758** as of December 31, 2024, to **$10,448,853** as of June 30, 2025[11](index=11&type=chunk) - Significant changes in equity include **common stock redeemed** (**$1,001,216**), **release of common stock subject to redemption** (**$916,093**), **Series A preferred stock in exchange of Series A Preferred Stock categorized as liability** (**$1,391,176**), **Series D preferred stock in exchange of convertible notes** (**$3,333,335**), **common stock issued for exercise of warrants** (**$3,309,921**), and **common stock issued for business combination costs** (**$9,000,000**)[11](index=11&type=chunk) - The company reported a **net loss** of **$(10,248,486)** for the period ending March 31, 2025, and **$(5,188,755)** for the period ending June 30, 2025[11](index=11&type=chunk) [Notes to the Unaudited Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20the%20Unaudited%20Consolidated%20Financial%20Statements) This section provides detailed explanations of accounting policies, financial accounts, equity, commitments, and going concern risks [1. Organization and Description of Business](index=7&type=section&id=1.%20Organization%20and%20Description%20of%20Business) This note describes Cycurion's corporate structure, business operations, recent business combination, and going concern status - Cycurion, Inc. was incorporated on October 12, 2017, in Delaware and provides information technology security solutions through its subsidiaries[13](index=13&type=chunk) - The company operates through Cycurion Sub, Inc., Axxum Technologies LLC, Cloudburst Security LLC, and Cycurion Innovation, Inc[14](index=14&type=chunk) - On February 14, 2025, Cycurion completed a business combination with Western Acquisition Ventures Corp., accounted for as a reverse recapitalization where Cycurion is the accounting acquirer[15](index=15&type=chunk)[16](index=16&type=chunk) - As of June 30, 2025, the company had a **net working capital deficit of $14.4 million** and an **accumulated deficit of $18.7 million**, with a **net cash outflow of $6.3 million** from operating activities, raising substantial doubt about its ability to continue as a going concern[20](index=20&type=chunk) - Cycurion received multiple notices from Nasdaq in April and May 2025 regarding non-compliance with listing rules, including minimum bid price, market value of listed securities, market value of publicly held shares, and timely filing of its Form 10-Q (which was subsequently filed)[22](index=22&type=chunk)[23](index=23&type=chunk)[24](index=24&type=chunk)[25](index=25&type=chunk) [2. Significant Accounting Policies](index=9&type=section&id=2.%20Significant%20Accounting%20Policies) This note outlines the key accounting principles and methods used in preparing the consolidated financial statements - The unaudited consolidated condensed financial statements are presented in conformity with GAAP and SEC rules, reflecting normal recurring adjustments[28](index=28&type=chunk) - The company operates in a single reporting segment and consolidates the accounts of Cycurion, Inc. and its wholly-owned subsidiaries: Axxum, Cloudburst, Cycurion Innovation, and SLG Innovation Inc[30](index=30&type=chunk)[31](index=31&type=chunk) - Cycurion is an emerging growth company and has elected not to opt out of the extended transition period for new accounting standards, allowing it to adopt standards at the same time as private companies[34](index=34&type=chunk) - Revenue from contracts with customers is recognized using a five-step model, with services segregated into Advisory Consulting, Managed Security Service Practice (MSSP), Managed Service Provider (MSP), and Software as a Service (SaaS), each with specific recognition methodologies[50](index=50&type=chunk)[52](index=52&type=chunk) Disaggregated Revenue | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Advisory consulting | $3,848,688 | $4,979,292 | $7,684,102 | $9,199,854 | | Managed security service practice (MSSP) | $35,555 | $18,348 | $67,068 | $36,969 | | Software as a service (SaaS) | $3,672 | $3,672 | $6,795 | $7,344 | | **Total Revenue** | **$3,887,915** | **$5,001,312** | **$7,757,965** | **$9,244,167** | - The company is currently evaluating the impact of ASU 2024-03 (Expense Disaggregation Disclosures) and ASU 2023-09 (Income Tax Disclosures), effective for fiscal years beginning after December 15, 2026, and December 31, 2025, respectively. ASU 2024-02 (Codification Improvements) is not expected to have a material impact[70](index=70&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk) [3. Accounts Receivable, Net](index=15&type=section&id=3.%20Accounts%20Receivable%2C%20Net) This note details the composition of accounts receivable and the allowance for credit losses Accounts Receivable, Net | Metric | June 30, 2025 | December 31, 2024 | | :---------------------- | :-------------- | :---------------- | | Accounts receivable | $4,118,888 | $10,353,708 | | Allowance for credit losses | $0 | $0 | | **Accounts receivable, net** | **$4,118,888** | **$10,353,708** | - No write-offs of outstanding receivables occurred during the three and six months ended June 30, 2025 and 2024[74](index=74&type=chunk) [4. Property and Equipment, Net](index=15&type=section&id=4.%20Property%20and%20Equipment%2C%20Net) This note provides a breakdown of the company's property and equipment, net of accumulated depreciation Property and Equipment, Net | Category | June 30, 2025 (Net Carrying Amount) | December 31, 2024 (Net Carrying Amount) | | :-------------------- | :----------------------------------- | :----------------------------------- | | Equipment | $996 | $3,677 | | Furniture and fixtures | $6,715 | $6,943 | | Leasehold improvements | $0 | $0 | | Capital lease | $3,107 | $3,107 | | Software | $6,014 | $6,594 | | **Total** | **$16,832** | **$20,321** | - Immaterial depreciation expense was recorded in cost of revenue and selling, general and administrative expenses during the periods[75](index=75&type=chunk) [5. Software Development Costs](index=15&type=section&id=5.%20Software%20Development%20Costs) This note details the company's capitalized software development costs and their current development status Capitalized Software Development Costs | Period | June 30, 2025 | June 30, 2024 | | :------------------------------- | :-------------- | :-------------- | | Three Months Ended | $104,000 | $132,999 | | Six Months Ended | $174,000 | $238,000 | - The SaaS platform is still undergoing development and not ready for external sales; no amortization has been recorded during the three and six months ended June 30, 2025 and 2024[76](index=76&type=chunk) [6. Intangible Assets](index=16&type=section&id=6.%20Intangible%20Assets) This note presents the company's intangible assets, including software, and related amortization expenses Intangible Assets, Net | Category | June 30, 2025 (Net Carrying Amount) | December 31, 2024 (Net Carrying Amount) | | :----------------------- | :----------------------------------- | :----------------------------------- | | Contractual relationship | $0 | $0 | | Implementation | $0 | $0 | | Software | $7,917 | $25,000 | | **Total** | **$7,917** | **$25,000** | - Amortization expense for intangible assets, presented in SG&A, was **$8,750** for the three months ended June 30, 2025, and **$17,083** for the six months ended June 30, 2025. No amortization was recorded in 2024[79](index=79&type=chunk) [7. Business Combination](index=16&type=section&id=7.%20Business%20Combination) This note describes the acquisition of SLG Innovation, Inc., including purchase consideration and goodwill recognition - On March 31, 2025, Cycurion acquired a **51% equity interest** in SLG Innovation, Inc., a technology services firm[84](index=84&type=chunk) - The **total purchase consideration** for the SLG acquisition was **$13,538,306**, including a **$2,000,000** prepaid deposit, **1,008,282 shares of common stock**, **51 shares of Series E Preferred Stock**, and **$10,814,147** of accounts receivable from SLG[86](index=86&type=chunk) - The acquisition resulted in the provisional recognition of **$14,195,995 in goodwill**[86](index=86&type=chunk) - The acquisition is accounted for as a business combination under ASC 805, with provisional amounts subject to change within a one-year measurement period ending March 31, 2026[85](index=85&type=chunk) [8. Goodwill](index=18&type=section&id=8.%20Goodwill) This note provides a breakdown of goodwill by subsidiary, including the impact of the SLG Innovation acquisition Details of Goodwill | Subsidiary | June 30, 2025 | December 31, 2024 | | :--------- | :-------------- | :---------------- | | Axxum | $5,153,266 | $5,153,266 | | Cloudburst | $1,439,038 | $1,439,038 | | SLG | $14,195,995 | $0 | | **Total Goodwill** | **$20,788,299** | **$6,592,304** | - The acquisition of SLG Innovation Inc. on March 31, 2025, contributed **$14,195,995 to goodwill**, reflecting the strategic value of SLG's operations, expected synergies, and future growth potential[95](index=95&type=chunk) - No impairment of **goodwill** was recognized during the three and six months ended June 30, 2025 and 2024[45](index=45&type=chunk) [9. Bank Loans](index=19&type=section&id=9.%20Bank%20Loans) This note details the company's bank loans, including revolving credit lines, term loans, and collateral arrangements - The **outstanding balance** of the revolving credit line was **$3,236,167** as of June 30, 2025, with a stated **interest rate of 8.50%**[101](index=101&type=chunk) - The bank term loan's maturity date was extended to March 22, 2024, with monthly principal repayments of **$62,500** and a stated **interest rate of 9.5%** as of June 30, 2025[104](index=104&type=chunk)[106](index=106&type=chunk) - The **current portion** of the bank loan was **$620,078** as of June 30, 2025, compared to **$774,095** as of December 31, 2024[106](index=106&type=chunk) - Axxum, Cloudburst, and Cycurion have pledged all equity and assets as collateral for the bank loans[107](index=107&type=chunk)[108](index=108&type=chunk) [10. Loans Payable](index=20&type=section&id=10.%20Loans%20Payable) This note outlines various loans payable, including economic injury disaster loans and private loans, and their default status Details of Loans Payable | Category | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :-------------- | :---------------- | | Loan payable | $405,314 | $405,314 | | Loan payable - SLG | $264,379 | $0 | | Economic injury disaster loan - Cycurion | $150,000 | $150,000 | | Economic injury disaster loan - SLG | $157,220 | $0 | | Private loan payable | $203,623 | $0 | | **Funded loans Payable** | **$1,180,536** | **$555,314** | | Less: Unamortized debt-issuance costs and discounts | $0 | $0 | | **Total loans payable** | **$1,180,536** | **$555,314** | | Less: Current portion of long-term debt | $885,240 | $408,516 | | **Long-term debt** | **$295,296** | **$146,798** | - Several **loans**, including the RPA Loan (**$405,314**), **Loan Payable-SLG** (**$264,379**), and **Private Loan payable** (**$203,623**), are currently in default as of June 30, 2025[111](index=111&type=chunk)[114](index=114&type=chunk)[115](index=115&type=chunk) [11. Convertible Notes](index=21&type=section&id=11.%20Convertible%20Notes) This note details the issuance and subsequent conversion of the company's convertible notes into equity Rollforward of Convertible Notes (December 31, 2024 to June 30, 2025) | Metric | Principal Value | Unamortized Discount and Issuance Costs | Carrying Balance | Weighted Average Interest Rate | Maturity | | :-------------------------- | :-------------- | :------------------------------------ | :--------------- | :----------------------------- | :------- | | Balance as of Dec 31, 2024 | $0 | $0 | $0 | - | - | | Issuance (Q1 2025) | $440,217 | $(53,717) | $386,500 | 18.0% | 2026 | | Issuance (Q2 2025) | $2,050,000 | $(60,000) | $1,990,000 | 15.1% | 2026 | | Conversion to equity (Q2 2025) | $(2,490,217) | $82,465 | $(2,407,752) | 18.0% | 2026 | | **Balance as of June 30, 2025** | **$0** | **$0** | **$0** | **0.0%** | **2026** | - All outstanding **convertible notes** were converted to **Series F preferred stock** on June 30, 2025[116](index=116&type=chunk) [12. Promissory Notes](index=22&type=section&id=12.%20Promissory%20Notes) This note describes the company's promissory notes payable and the gain recognized on debt settlement Details of Promissory Notes Payable | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :-------------- | :---------------- | | Funded loans payable | $2,699,094 | $2,498,369 | | Less: Unamortized debt-issuance costs and discounts | $(29,468) | $(11,380) | | **Total loans payable** | **$2,669,626** | **$2,486,989** | - During the first quarter of calendar year 2025, the Company issued **preferred stocks** and **warrants** in exchange for **$3,333,335** in outstanding **convertible promissory notes** and **$299,259** in accrued interest, resulting in a gain on debt settlement of **$299,259**[123](index=123&type=chunk) [13. Factoring Liability](index=23&type=section&id=13.%20Factoring%20Liability) This note explains the company's factoring liability arising from agreements to loan against accounts receivable - As of June 30, 2025, the **factoring liability** was **$2,309,160**, arising from an agreement to loan proceeds against certain accounts receivable[126](index=126&type=chunk) - The **maximum factoring facility** is **$3.0 million**, with a factoring cost of **1.5%** for days 1-30 and an additional **0.5%** fee for each additional 10-day period[125](index=125&type=chunk) [14. Series A Convertible Preferred Stock](index=23&type=section&id=14.%20Series%20A%20Convertible%20Preferred%20Stock) This note details the Series A Convertible Preferred Stock, including issuance, voting rights, dividends, and liquidation preference - **106,816 shares of Series A Convertible Preferred Stock** were issued and outstanding as of June 30, 2025, compared to zero as of December 31, 2024, issued as part of the Business Combination with Western during Q1 2025[139](index=139&type=chunk)[140](index=140&type=chunk) - Holders have voting rights on an as-if-converted basis, are entitled to a **12% annual dividend** payable quarterly in **common stock**, and can convert into **common stock** at a **1-for-1 ratio** (subject to blockers). They also have a liquidation preference equal to the stated value plus accrued dividends[134](index=134&type=chunk)[135](index=135&type=chunk)[136](index=136&type=chunk)[137](index=137&type=chunk) [15. Equity](index=23&type=section&id=15.%20Equity) This note provides a comprehensive overview of the company's equity structure, including common stock, preferred stock, and warrants - The company has authorized **20,000,000 shares of preferred stock** and **100,000,000 shares of common stock**[129](index=129&type=chunk)[181](index=181&type=chunk) - As of June 30, 2025, there were **zero shares of common stock** subject to possible redemption (Mezzanine Equity), down from **173,879 shares** as of December 31, 2024[132](index=132&type=chunk) - **Series B Convertible Preferred Stock** outstanding shares decreased from **3,000** to **1**, with **2,999 shares** converted into **5,998,653 shares of common stock** during the six months ended June 30, 2025[147](index=147&type=chunk)[148](index=148&type=chunk) - **Series C Convertible Preferred Stock** had **4,851 shares** issued and outstanding as of June 30, 2025, issued in Q1 2025 in exchange for existing **common stock** and **warrants**. No conversions occurred in Q2 2025[155](index=155&type=chunk)[156](index=156&type=chunk) - **Series D Convertible Preferred Stock** outstanding shares increased to **150,000** from **0**, with **6,516,666 shares** converted into **common stock** during Q1 2025. No conversions occurred in Q2 2025[163](index=163&type=chunk)[164](index=164&type=chunk) - **51 shares of Series E Convertible Preferred Stock** were issued as consideration for the SLG Innovation acquisition in Q1 2025[170](index=170&type=chunk) - All outstanding **convertible notes** were converted to **Series F preferred stock** on June 30, 2025[116](index=116&type=chunk)[171](index=171&type=chunk) - **Common stock** issued and outstanding increased from **10,592,607 shares** to **40,353,983 shares** as of June 30, 2025[182](index=182&type=chunk) Rollforward of Warrants (December 31, 2024 to June 30, 2025) | Metric | Number of Warrants | Weighted Average Exercise Price | Weighted Average Life (years) | | :-------------------------------- | :----------------- | :------------------------------ | :---------------------------- | | Outstanding warrants, Dec 31, 2024 | 9,450,840 | $0.69 | 3.0 | | Granted | 26,099,773 | $5.50 | 4.7 | | Replacement of old warrants | (9,450,840) | $0.69 | 2.9 | | Exercised | (7,044,917) | $0.48 | 4.3 | | Issued - Prefunded (equity line) | 4,500,000 | $0.00 | 1.0 | | Exercised - Prefunded (equity line) | (2,500,000) | $0.00 | 1.0 | | Exercised | (709,000) | $0.50 | 5.0 | | **Outstanding warrants, June 30, 2025** | **20,345,856** | **$7.62** | **4.8** | [16. Concentrations, Risks and Uncertainties](index=29&type=section&id=16.%20Concentrations%2C%20Risks%20and%20Uncertainties) This note discusses the company's exposure to credit risk, interest rate risk, labor cost risk, and customer revenue concentration - The company is exposed to credit risk from bank deposits exceeding FDIC insurance limits and credit extended to customers[198](index=198&type=chunk)[199](index=199&type=chunk) - The company faces **interest rate risk** due to adjustable **interest rates** on its loans and potential refinancing needs[200](index=200&type=chunk) - Significant increases in labor costs that cannot be passed on to customers could adversely impact the company's results of operations[201](index=201&type=chunk) Revenue Concentration by Customer (Greater than 10% of Revenue) | Customer | Three Months Ended June 30, 2025 (Amount) | Three Months Ended June 30, 2025 (%) | Six Months Ended June 30, 2025 (Amount) | Six Months Ended June 30, 2025 (%) | | :------- | :---------------------------------------- | :----------------------------------- | :--------------------------------------- | :----------------------------------- | | A | $1,138,481 | 29.3% | $2,251,053 | 29.0% | | B | $594,460 | 15.3% | $1,158,080 | 14.9% | | C | $374,780 | 9.6% | $861,958 | 11.1% | Accounts Receivable Concentration by Customer (Greater than 10% of Accounts Receivable) | Customer | June 30, 2025 (Amount) | June 30, 2025 (%) | | :------- | :----------------------- | :---------------- | | 1 | $1,284,470 | 31% | | 2 | $911,832 | 22% | | 3 | $585,852 | 14% | - Customer concentration disclosures were re-evaluated after the SLG acquisition, breaking out individual SLG customers, making amounts not comparable to Q1 2025[203](index=203&type=chunk) [17. Fair Value Disclosures](index=30&type=section&id=17.%20Fair%20Value%20Disclosures) This note provides fair value disclosures for financial instruments, including notes payable, preferred stock, and warrants - The carrying value of the company's notes payable approximated its fair value as of June 30, 2025, and December 31, 2024, estimated using discounted future cash flows (Level 3 inputs)[204](index=204&type=chunk) Fair Value Hierarchy - Liabilities (December 31, 2024) | Liabilities | Level 3 | Total | | :-------------------------------- | :-------------- | :-------------- | | Subordinated convertible promissory notes | $5,490,324 | $5,490,324 | | Series A convertible preferred stock | $1,294,117 | $1,294,117 | | **Total liabilities** | **$6,784,441** | **$6,784,441** | Fair Value Hierarchy - Equity (December 31, 2024) | Equity | Level 3 | Total | | :------- | :-------------- | :-------------- | | Warrants | $2,687,074 | $2,687,074 | | **Total equity** | **$2,687,074** | **$2,687,074** | - No assets or liabilities were recorded at fair value on a recurring basis as of June 30, 2025[205](index=205&type=chunk) [18. Related Party Transactions](index=31&type=section&id=18.%20Related%20Party%20Transactions) This note details transactions and financial arrangements with related parties, including loans and contract purchases - On September 20, 2024, the company entered into a **$230,000 promissory note** with the Sponsor, bearing **10% interest**, which was fully borrowed as of June 30, 2025[208](index=208&type=chunk) - Officers and stockholders Emmit McHenry, Kurt McHenry, and Alvin McCoy III provided personal guarantees for the Main Street Bank loan[209](index=209&type=chunk) - Axxum purchased an AT&T contract from Archura, LLC (owned by Emmit McHenry and Kurt McHenry) in late 2018, with **total sales of $83,790** as of June 30, 2025[210](index=210&type=chunk) Details of Loans Payable - Related Party | Category | June 30, 2025 | December 31, 2024 | Weighted Average Interest Rate | Maturity (Calendar Year) | | :---------------------------------------- | :-------------- | :---------------- | :----------------------------- | :----------------------- | | Loans to two directors issued in 2023 | $130,900 | $130,900 | 24.0% | 2023 | | Loan to a director issued in 2024 | $20,250 | $20,250 | 24.0% | 2025 | | **Funded loans payable - related party principal** | **$151,150** | **$151,150** | | | | Less: Unamortized debt-issuance costs and discounts | $(778) | $(3,062) | | | | **Loans payable - related party - current** | **$150,372** | **$148,088** | | | [19. Earnings Per Share](index=31&type=section&id=19.%20Earnings%20Per%20Share) This note presents the basic and diluted earnings per share calculations, including the impact of common stock equivalents Basic and Diluted (Loss)/Earnings Per Share | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Net (loss)/income attributable to common stockholders - basic | $(5,188,759) | $306,094 | $(15,437,241) | $(6,381) | | Weighted average shares outstanding - basic | 34,791,716 | 14,968,215 | 26,707,978 | 14,968,215 | | **Basic net (loss)/income per share** | **$(0.15)** | **$0.02** | **$(0.58)** | **$(0.00)** | | Net (loss)/income attributable to common stockholders - diluted | $(5,186,259) | $308,594 | $(15,398,908) | $(1,381) | | Weighted average shares outstanding - diluted | 34,891,716 | 32,383,372 | 26,807,978 | 16,704,748 | | **Diluted net (loss)/income per share** | **$(0.15)** | **$0.01** | **$(0.57)** | **$(0.00)** | - **Common stock equivalents** were excluded from the computation of diluted net loss per share as of June 30, 2025, due to their anti-dilutive effect[66](index=66&type=chunk) [20. Commitments and Contingencies](index=32&type=section&id=20.%20Commitments%20and%20Contingencies) This note outlines the company's various commitments and contingencies, including legal fees, equity purchase agreements, and excise tax liability - The Business Combination Marketing Agreement with A.G.P. was terminated upon entry into the Advisory Agreement[215](index=215&type=chunk)[220](index=220&type=chunk) - Upon Business Combination completion, A.G.P. received a **cash fee of $500,000**, **common stock, and warrants**. The **Transaction Fee** was later amended to be payable in **preferred shares convertible into 5,000,000 common shares** at **$0.50 per share**, subject to forfeiture and lock-up provisions[216](index=216&type=chunk)[218](index=218&type=chunk)[219](index=219&type=chunk) - The company agreed to pay approximately **$1.3 million in legal fees to Seward & Kissel LLP** in **common stock** and a **pre-funded warrant exercisable for up to 2,500,000 common shares**[221](index=221&type=chunk)[222](index=222&type=chunk) - On April 7, 2025, Cycurion entered into an **Equity Purchase Agreement** with an investor, granting the right to **sell up to $60 million in common stock**. A **Pre-Funded Warrant** for **4,500,000 shares** was issued as a **commitment fee**[227](index=227&type=chunk)[229](index=229&type=chunk)[231](index=231&type=chunk) - As of June 30, 2025, the company recognized an **excise tax liability of $1,167,174** due to stock redemptions, calculated as **1%** of the value of redeemed shares under the Inflation Reduction Act of 2022[240](index=240&type=chunk) - On June 16, 2025, the Board of Directors approved **retention packages for CEO L. Kevin Kelly and CFO Alvin McCoy III**, **issuing each officer 3,000,000 shares of Common Stock**[237](index=237&type=chunk) [21. Subsequent Events](index=34&type=section&id=21.%20Subsequent%20Events) This note discloses significant events that occurred after the reporting period, including warrant exercises and equity sales - In July 2025, all remaining **2,000,000 pre-funded warrants** were exercised for a **total of $200** in proceeds[241](index=241&type=chunk) - During July 2025, the company **utilized its equity line to sell 3,072,054 shares** for **net proceeds of $919,527**[241](index=241&type=chunk) - In July 2025, **6,000,000 shares of common stock** were issued to executives as part of compensation packages[242](index=242&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Cycurion's financial condition, operating results, liquidity, and capital resources for the period ended June 30, 2025 [Forward-Looking Statements](index=35&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements based on current beliefs, expectations, and assumptions, subject to various risks and uncertainties - This section contains forward-looking statements based on current beliefs, expectations, and assumptions, which are subject to risks and uncertainties[245](index=245&type=chunk) - Key risks include maintaining Nasdaq listing, recognizing business combination benefits, managing growth, meeting capital requirements, achieving profitability, attracting talent, executing acquisitions, and complying with regulations[247](index=247&type=chunk) - The company does not undertake to update these statements to reflect future events, except as required by applicable securities laws[246](index=246&type=chunk) [General and Business Overview](index=36&type=section&id=General%20and%20Business%20Overview) This section provides an overview of Cycurion's cybersecurity solutions, operating subsidiaries, and strategic acquisitions - Cycurion provides high-quality cybersecurity solutions to federal government civilian, defense, and judiciary agencies, as well as commercial clients, with growth driven by organic solutions and strategic acquisitions[250](index=250&type=chunk) - The company's operating subsidiaries include Axxum Technologies LLC (acquired Nov 2017), Cloudburst Security LLC (acquired Apr 2019), Cycurion Innovation, Inc. (formed Sep 2021, operating Cycurion Security Platform with MDP SaaS, WAF, and Bot Mitigation powered by AI), and SLG Innovation, Inc. (**51% equity interest acquired Mar 31, 2025**)[252](index=252&type=chunk)[253](index=253&type=chunk)[254](index=254&type=chunk)[255](index=255&type=chunk)[261](index=261&type=chunk) - Cycurion intends to acquire SLG's accounts receivable from RCR Technology Corporation, contingent upon the SLG acquisition, with the transaction expected to close in the second half of the current fiscal year[266](index=266&type=chunk)[267](index=267&type=chunk) - The company acquired technology assets from Sabres (Multi-Dimensional Protection, Web Application Firewall, and Bot Mitigation SaaS platforms) on August 17, 2021, integrating them into its Managed Security Services Practice to enhance service offerings and expand commercial business[269](index=269&type=chunk)[270](index=270&type=chunk)[272](index=272&type=chunk) [Financial Overview](index=39&type=section&id=Financial%20Overview) This section highlights key financial factors influencing the second quarter of fiscal year 2025 results - Key factors contributing to the second quarter of fiscal year 2025 results include the acquisition of SLG Innovation Inc. and the completion of the business combination with Western Acquisition Ventures Corp[273](index=273&type=chunk)[277](index=277&type=chunk) [Results of Operations](index=39&type=section&id=Results%20of%20Operations) This section analyzes Cycurion's consolidated revenues, costs, gross profit, and operating results for the specified periods Consolidated Results of Operations | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Net revenues | $3,887,915 | $5,001,312 | $7,757,965 | $9,244,167 | | Cost of revenues | $3,651,978 | $3,977,150 | $6,844,265 | $7,873,291 | | Gross profit | $235,937 | $1,024,162 | $913,700 | $1,370,876 | | Gross profit percentage | 6.1% | 20.5% | 11.8% | 14.8% | | Selling, general and administrative expenses | $4,002,018 | $294,790 | $14,777,281 | $673,767 | | Operating (loss)/income | $(3,766,081) | $729,372 | $(13,863,581) | $697,109 | | Net (loss)/income attributable to Cycurion | $(5,188,759) | $306,094 | $(15,437,241) | $(6,381) | - **Net revenues decreased by 22%** (**$1,113,397**) for the three months and **16%** (**$1,486,202**) for the six months ended June 30, 2025, compared to 2024, primarily due to delayed start dates of new federal, state, and local contracts and a focus on more profitable business[275](index=275&type=chunk)[276](index=276&type=chunk) - **Selling, general and administrative expenses significantly increased** in 2025 compared to 2024 due to additional merger and acquisition-related legal, administrative, and consulting costs[279](index=279&type=chunk) - **Interest expense rose to $615,392** (three months) and **$794,283** (six months) in 2025, up from **$482,355** and **$713,830** in 2024, driven by changes in underlying debt instruments[280](index=280&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses Cycurion's cash position, cash flow activities, and ability to meet its financial obligations - As of June 30, 2025, the company had **$1,013,836 in cash and cash equivalents**[281](index=281&type=chunk) Net Changes in Cash and Cash Equivalents (Six Months Ended) | Activity | June 30, 2025 | June 30, 2024 | | :---------------------------------------- | :-------------- | :-------------- | | Net cash used in operating activities | $(6,303,122) | $(850,413) | | Net cash provided by/(used in) investing activities | $1,695,523 | $(592,000) | | Net cash provided by financing activities | $5,580,645 | $1,032,678 | | **Net increase/(decrease) in cash and cash equivalents** | **$973,046** | **$(409,735)** | - **Net cash used in operating activities increased significantly to $6,303,122** in 2025, primarily due to additional merger expenses[283](index=283&type=chunk) - **Net cash provided by investing activities was $1,695,523** in 2025, mainly from the Trust Account for redemption and cash released from the Trust Account to the Company[284](index=284&type=chunk) - **Net cash provided by financing activities was $5,580,645** in 2025, including proceeds from warrant exercises (**$3,664,671**), convertible notes (**$2,376,500**), and the equity line of credit (**$265,504**)[285](index=285&type=chunk) - The company has an **accumulated deficit of approximately $18.8 million** and **negative operating cash flow**, raising substantial doubt about its ability to continue as a going concern without obtaining additional financing[288](index=288&type=chunk)[289](index=289&type=chunk)[290](index=290&type=chunk) - The company did not have any off-balance sheet arrangements during the periods presented[292](index=292&type=chunk) [Critical Accounting Policies and Estimates](index=41&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms no material changes to critical accounting policies during the six months ended June 30, 2025 - No material changes to critical accounting policies were reported during the six months ended June 30, 2025[293](index=293&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a "smaller reporting company," Cycurion is exempt from providing detailed quantitative and qualitative disclosures about market risk [Item 4. Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control - Management, including the CEO and CFO, evaluated the effectiveness of Cycurion's disclosure controls and procedures as of June 30, 2025, and concluded they were effective[296](index=296&type=chunk)[297](index=297&type=chunk) - There were no changes in Cycurion's internal control over financial reporting during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[298](index=298&type=chunk) PART II - OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, and other corporate information [Item 1. Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company settled a material arbitration proceeding and has no other significant pending or threatened legal actions - An arbitration proceeding initiated by Object3, LLC against Cloudburst Security, LLC for approximately **$228,000** in unpaid consulting services has been settled[301](index=301&type=chunk) - The company is not aware of any other material pending legal proceedings or any adverse legal activity anticipated or threatened[302](index=302&type=chunk) [Item 1A. Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) The company's business faces risks from legislative, budgetary, and regulatory changes, potentially impacting contracts, revenues, and competition - The company's business is largely dependent on domestic and international legislative programs and budgetary support, with many contracts relying on future appropriations and subject to unilateral modification or termination[306](index=306&type=chunk) - Changes in state or federal government initiatives, spending due to budgetary considerations, procurement rules, or federal regulations (e.g., related to diversity, equity, and inclusion or return-to-office mandates) could adversely affect future revenues, profitability, and business practices, potentially increasing competition[306](index=306&type=chunk)[307](index=307&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities for the six months ended June 30, 2025 - There were no unregistered sales of equity securities for the six months ended June 30, 2025[308](index=308&type=chunk) [Item 3. Defaults Upon Senior Securities](index=44&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - The company reported no defaults upon senior securities[310](index=310&type=chunk) [Item 4. Mine Safety Disclosures](index=44&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable to the company[311](index=311&type=chunk) [Item 5. Other Information](index=44&type=section&id=Item%205.%20Other%20Information) This section details a pre-funded warrant issuance and confirms no Rule 10b5-1 trading arrangement changes by insiders - On April 7, 2025, the company issued a **pre-funded warrant** to Yield Point NY LLC for up to **4,500,000 shares of Common Stock** as consideration for the **Equity Purchase Agreement**, in lieu of a **$1,800,000 cash payment**[315](index=315&type=chunk) - No director or officer adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended June 30, 2025[313](index=313&type=chunk) [Item 6. Exhibits](index=44&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO/CFO certifications and XBRL documents - The exhibits include certifications from the Chief Executive Officer and Chief Financial Officer pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, as well as Inline XBRL Instance Document and Taxonomy Extension files[314](index=314&type=chunk) [SIGNATURES](index=45&type=section&id=SIGNATURES) The report is signed by Cycurion Inc.'s Chief Executive Officer and Chief Financial Officer on August 13, 2025 - The report was signed by L. Kevin Kelly, Chief Executive Officer, and Alvin McCoy III, Chief Financial Officer, on August 13, 2025[316](index=316&type=chunk)

Financial Performance - Revenues from SLG for the fiscal years 2024 and 2023 were $14,703,887 and $13,837,042, respectively, indicating a year-over-year growth of approximately 6.3%[267] - Revenue for the three months ended March 31, 2025, was $3,870,050, a decrease of $372,805 or 8.79% compared to $4,242,855 in the same period of 2024[283] - Cost of revenue decreased by $703,854 or 18.07% to $3,192,287 for the three months ended March 31, 2025, from $3,896,141 in 2024[286] - Selling, general and administrative expenses increased significantly by $10,396,291 or 2743.25% to $10,775,268 for the three months ended March 31, 2025, compared to $378,977 in 2024[288] - Net loss for the three months ended March 31, 2025, was $10,248,486, compared to a net loss of $312,475 in the same period of 2024[282] - Cash and cash equivalents at the end of the period increased to $2,269,195 as of March 31, 2025, from $206,939 at the end of March 2024[291] - The accumulated deficit increased to approximately $13,461,859 as of March 31, 2025, from $3,203,361 at December 31, 2024[297] - Net cash used in operating activities was $2,745,109 for the three months ended March 31, 2025, compared to $272,446 in the same period of 2024[292] - Net cash provided by financing activities was $3,173,991 for the three months ended March 31, 2025, compared to a net cash used of $23,483 in 2024[296] - The company expects continued significant operating losses for the next few years and plans to seek additional financing[298] - The total assets increased to approximately $31.6 million as of March 31, 2025, from approximately $25.6 million at December 31, 2024, primarily due to increases in goodwill[298] Acquisition and Strategic Plans - The acquisition of SLG is expected to enhance Cycurion's qualifications for future government contracts due to SLG's historical relationships with contracting agencies[267] - Cycurion entered into a Term Sheet with SLG on April 25, 2023, for the acquisition, which includes provisions for forming two new subsidiaries[268] - The SLG Term Sheet allows Cycurion to terminate the agreement at any time before April 11, 2025, without further obligations[269] - Cycurion plans to close the transactions contemplated by the SLG Term Sheet during the current fiscal quarter[269] - The RCR Term Sheet, related to SLG, is expected to be closed in the second half of the current fiscal year, contingent upon the SLG transaction[273] - Cycurion's growth strategy includes organic business solutions and strategic acquisitions of cyber/infrastructure service providers[257] Technology and Services - Cycurion acquired technology assets from Sabres, including Multi-Dimensional Protection and Bot Mitigation SaaS platforms, which were integrated into existing services[277] - The Cycurion Security Platform utilizes a proprietary cloud-based AI algorithm to enhance cybersecurity measures in real-time against emerging threats[278] - The MDP SaaS platform combines Web Application Firewall and Bot Mitigation to improve clients' cyber posture and reduce risks from automated attacks[278] Stock and Market Considerations - The fair value of the Common Stock was estimated due to its lack of historical public trading[316] - The expected term for options is calculated to be 10 years based on the average vesting term and contractual period[316] - Expected volatility is derived from the historical share volatility of comparable publicly traded companies[316] - The risk-free interest rate is based on U.S. Treasury securities yields appropriate for the term of the award[316] - The company has not paid dividends on its Common Stock and does not expect to in the foreseeable future[316] - The assessment includes contemporaneous third-party valuations of the Common Stock[316] - The analysis considers the likelihood of achieving a liquidity event, such as an IPO or sale of the company[316] - Market performance of comparable publicly traded companies is taken into account[316] - The company is classified as a "smaller reporting company" and is not required to provide additional market risk disclosures[317]

Financial Performance - Gross profit for 2024 reached $3,634,743, representing a margin of 20.5%, compared to $2,643,060 and a margin of 13.7% in 2023 [56]. - Operating income increased to $2,416,113 in 2024, with a margin of 13.6%, up from $326,411 and a margin of 1.7% in 2023 [56]. - Net income for 2024 was $1,229,601, a significant improvement from a net loss of $2,097,013 in 2023, reflecting a margin of 6.9% [56]. - The number of customers grew to 41 in 2024, up from 38 in 2023 [56]. - The company has over 41 customers, with the top ten customers accounting for approximately 93% of total revenue in 2024 and 88% in 2023 [83]. Business Operations - Cycurion's growth engine is driven by organic business solutions and strategic acquisitions of cybersecurity services and technology providers [29]. - Managed security services include 24/7 monitoring, threat detection, incident response, and remediation [38]. - The company provides consulting and advisory services to enhance customers' cybersecurity programs [30]. - Cycurion's managed IT services optimize IT infrastructure, reduce costs, and improve operational efficiency [33]. - The company has numerous prime and subcontracts with key government agencies, enhancing its market position [29]. Strategic Acquisitions - Cycurion Sub executed a Term Sheet with SLG Innovation Inc. for acquisition, with plans to close the transaction in the current fiscal quarter [67]. - The SLG Management Agreement aims to enhance SLG's commercial viability and consolidate its financial statements with Cycurion [70]. - Axxum Technologies, acquired in November 2017, continues to provide cybersecurity services to federal government clients while expanding its commercial footprint [58]. - Cloudburst Security, acquired in April 2019, specializes in innovative cybersecurity services for various sectors, including healthcare and finance [61]. - Cycurion expects to close the transactions contemplated by the RCR Term Sheet in the first half of the current fiscal year, with a backlog of $16 million as of December 31, 2024, compared to $15 million in 2023 [86]. Technology and Innovation - The Cycurion ARx platform offers comprehensive cybersecurity solutions, including DDoS protection and endpoint protection [55]. - Cycurion's Cycurion Security Platform integrates technology assets acquired from Sabres, enhancing service offerings and expanding commercial business [80]. - The company plans to invest in new technology platforms and explore acquisition opportunities to enhance platform functionality and expand market reach [85]. - Cycurion's proprietary AI algorithm is expected to move into production in Q3 2024, enhancing the security capabilities of its Multi-Dimensional Protection platform [78]. - The company has integrated its acquired technology into its Managed Security Services Practice, providing real-time reporting and incident response [80]. Compliance and Market Status - Cycurion received a notification from Nasdaq regarding a deficiency in the closing bid price of its common stock, which has been below $1.00 for 30 consecutive business days, with a compliance deadline of October 6, 2025 [108]. - The company was also notified of a deficiency in maintaining a Market Value of Listed Securities (MVLS) below the required $50,000,000 for 30 consecutive business days, with a compliance deadline of October 8, 2025 [109]. - Additionally, Cycurion was informed of a deficiency in the Market Value of Publicly Held Shares (MVPHS), which has been below the required $15,000,000 for 30 consecutive business days, also with a compliance deadline of October 8, 2025 [110]. - Failure to regain compliance within the specified 180-day periods for either MVLS or MVPHS could result in delisting from Nasdaq, although the company retains the right to appeal [109][110]. - The Nasdaq notifications currently have no effect on the listing status of Cycurion's common stock [108][109][110]. Company Structure and Workforce - The company has a total of 46 full-time employees, with no part-time employees or union representation [89]. - The company has over 150 years of combined experience on its management team and has served over 275,000 students in the higher education sector [54]. Risks and Challenges - Cycurion has incurred net losses and cannot assure that it will achieve or maintain profitable operations [22]. - The company requires substantial additional funding in the future, which may not be available on acceptable terms [22]. - Cycurion's ability to grow and compete will be adversely affected if adequate capital is not available [22]. - The company has a limited operating history, raising substantial doubt regarding its ability to continue as a going concern [22]. - Cycurion's common stock price may be volatile, potentially leading to significant investment losses [22].

Financial Performance - For the three months ended September 30, 2024, the company reported a net loss of $375,004, which included professional fees, general and administrative expenses, and franchise taxes [177]. - For the nine months ended September 30, 2024, the company had a net loss of $670,325, consisting of $1,208,217 in professional fees and other expenses, offset by a $665,116 change in fair value of the forward purchase agreement [179]. - For the nine months ended September 30, 2023, the company reported a net loss of $757,781, which included $876,968 in professional fees and other expenses [180]. Liquidity and Capital Structure - As of September 30, 2024, the company had a working capital deficit of $3,664,323, indicating liquidity challenges [181]. - The company incurred significant costs in pursuit of acquisition plans and may need additional financing to complete the business combination [185]. - As of September 30, 2024, the Company has borrowed $554,269 and accrued approximately $21,906 in interest [200]. Acquisition and Merger Activities - The company has identified an acquisition target and executed a merger agreement with Cycurion, Inc., with plans to close the business combination by December 31, 2024 [169][170]. - The merger agreement may be terminated if not consummated by January 11, 2025, raising concerns about the company's ability to continue as a going concern [175][186]. - The Company entered into a promissory note with Cycurion for $200,000 at an interest rate of 5% per annum, with a maturity date of January 11, 2024 [200]. - The Company agreed to pay approximately $1.25 million of its obligations in shares of the Combined Company's common stock, totaling 250,000 shares at a price of $5.00 per share [199]. - The Forward Purchase Agreement was terminated on January 22, 2024, which previously allowed Alpha to sell up to 300,000 shares to the Company [202]. - The Company amended the Promissory Note multiple times, increasing the principal amount to $554,269 and extending the maturity date to January 11, 2025 [200]. Advisory and Support Agreements - The company plans to enter into an advisory agreement with A.G.P., which includes a transaction fee of $2,500,000 payable in preferred shares convertible into common stock [195]. - The Company has a Support Agreement in place with its Sponsor and certain stockholders to vote in favor of the merger and related transactions [171][173]. Auditor and Compliance - The Company dismissed its previous independent auditor, Marcum LLP, and engaged WWC, P.C. as its new independent auditor on July 10, 2024 [209]. - The Company adopted ASU 2016-13 on January 1, 2023, which did not have a material impact on its financial statements [206]. - The Company has no material changes to the quantitative and qualitative disclosures about market risk since its 2023 Annual Report [215]. Employment Agreements - On December 27, 2023, the Company entered into an employment agreement with James P. McCormick for total annual compensation of $125,000, including $40,000 in cash and $85,000 in stock payment [204]. Non-Operating Income - The company generated non-operating income in the form of interest income from the IPO proceeds placed in the Trust Account, but has not engaged in any operations or generated operating revenues to date [176]. Revised Arrangements - The Company has entered into revised arrangements with service providers, agreeing to pay obligations in shares of the Combined Company's common stock [199].

Financial Performance - For the three months ended June 30, 2024, the company reported a net loss of $703,701, which included $127,224 related to Non-Redemption Agreement and $576,477 in professional fees and administrative expenses [137]. - For the six months ended June 30, 2024, the company had a net loss of $295,321, consisting of $833,213 in professional fees and administrative expenses, offset by a $665,116 change in fair value of the forward purchase agreement [139]. - The company incurred net cash used in operating activities of $420,868 for the six months ended June 30, 2024, primarily due to a net loss and changes in operating assets and liabilities [142]. - Management has raised substantial doubt about the company's ability to continue as a going concern for twelve months from the issuance of the financial statements if the business combination is not completed [145]. Working Capital and Financing - As of June 30, 2024, the company had a working capital deficit of $3,289,361 and $14,876 in restricted cash available for tax liabilities [141]. - The company may need to obtain additional financing to complete the business combination or to meet obligations related to public share redemptions [144]. - The Company entered into a promissory note with Cycurion for $200,000 at a 5% annual interest rate, with a maturity date extended to October 11, 2024 [152]. - As of June 30, 2024, the Company has borrowed $554,269 and accrued approximately $14,900 in interest [152]. Business Combination and Acquisition - The company has identified an acquisition target and executed a merger agreement with Cycurion, intending to close the business combination by December 31, 2024 [130][131]. - The merger agreement may be terminated if not consummated by October 11, 2024, or if certain proposals fail to receive the requisite vote for approval [135]. - The company has engaged A.G.P. as an advisor for the business combination, with a fee arrangement of 4.5% of the gross proceeds of the IPO, amounting to $5,175,000, or distribution of 250,000 shares of common stock [151]. - The company has not generated any operating revenues to date and does not expect to do so until after the completion of the business combination [136]. Regulatory and Accounting Changes - The Company adopted ASU 2016-13 on January 1, 2023, which did not have a material impact on its financial statements [157]. - ASU No. 2023-09 will require additional disclosures in income tax rate reconciliation, effective after December 15, 2024 [158]. - The Company has not identified any material changes to market risk disclosures since the 2023 Annual Report [160]. Employment Agreements - An employment agreement was established with James P. McCormick, totaling $125,000 in annual compensation, including $40,000 in cash and $85,000 in stock payment [155]. Forward Purchase Agreement - The Forward Purchase Agreement was terminated on January 22, 2024 [154].

Financial Performance - For the three months ended March 31, 2024, the company reported a net income of $408,380, which included a $665,116 change in fair value of the forward purchase agreement, offset by $256,736 in expenses[134]. - For the three months ended March 31, 2023, the company had a net loss of $171,611, with net cash used in operating activities amounting to $393,175[135][138]. - The company incurred net cash used in operating activities of $107,643 for the three months ended March 31, 2024, primarily due to changes in operating assets and liabilities[137]. Working Capital and Financial Position - As of March 31, 2024, the company had a working capital deficit of $2,782,776 and $1,008 in restricted cash available for current tax liabilities[136]. - The company has incurred significant costs in pursuit of acquisition plans and may not have sufficient funds to operate prior to the business combination[139]. - The merger agreement may be terminated if not consummated by October 11, 2024, raising concerns about the company's ability to continue as a going concern[132][140]. Acquisition and Business Combination - The company has identified an acquisition target and executed a merger agreement with Cycurion, with plans to close the business combination by December 31, 2024[127][128]. - The company may need to obtain additional financing to complete the business combination or due to potential redemptions of public shares[139]. - The company has entered into a promissory note with Cycurion for $200,000, which has been amended to increase the principal amount to $554,269[147]. - The company has not generated any operating revenues to date and does not expect to do so until after the completion of the business combination[133]. Forward Purchase Agreement - The Company entered into a Forward Share Purchase Agreement (FPA) on January 10, 2023, allowing Alpha to sell up to 300,000 shares at the Redemption Price after the Business Combination closes[148]. - The FPA stipulates that Alpha can accelerate the Put Date to six or nine months post-BC Closing under certain conditions, including if the VWAP Price falls below $3.00 per share for 20 trading days[149]. - The Company terminated the Forward Purchase Agreement on January 22, 2024[150]. - The Company accounts for the FPA as a liability at fair value, subject to re-measurement at each reporting period, with changes recognized in the statements of operations[152]. Employment and Compensation - An employment agreement was established with James P. McCormick on December 27, 2023, with total annual compensation of $125,000, comprising $40,000 in cash and $85,000 in stock payment[151]. Accounting Standards and Disclosures - The Company adopted ASU 2016-13 on January 1, 2023, which did not materially impact its financial statements[153]. - ASU No. 2023-09, effective after December 15, 2024, will require additional disclosures in income tax rate reconciliation and disaggregation of income taxes paid[154]. - There have been no material changes to the quantitative and qualitative disclosures about market risk since the 2023 Annual Report[156].