The stated purchase price for TFL is $112.0 million, consisting of $89.6 million in cash (subject to adjustment) and $22.4 million in Kustom restricted common stock, 80% cash and 20% stock. The number of shares comprising the stock consideration will be set using the volume-weighted average trading price of Kustom common stock over the ten trading days ending immediately before closing, with no collar or floor. Of the $22.4 million in stock consideration, $11.2 million is structured as Holdback Shares that will be issued only if TFL achieves a specified Target EBITDA threshold (confirmed in Kustom's fairness-opinion materials as $20,870,747) measured from closing through calendar year 2027. Separately, Kustom will fund up to $35.0 million at closing to retire TFL's outstanding third-party debt, which does not reduce the stated purchase price, and TFL's own cash will be used to pay down debt first, such that Kustom expects to acquire zero cash. A Section 338(h)(10) tax election gross-up payable to sellers is capped at $845,000. Roth Capital Partners, LLC, in its fairness-opinion analysis, defined an all-in "Transaction Consideration" of $147,845,000, combining the $89.6 million cash, $22.4 million stock, $35.0 million debt payoff responsibility and the $845,000 tax gross-up at its cap.
Roth's fairness opinion, dated August 31, 2026 and included in Kustom's proxy statement, valued TFL using three methodologies. A comparable-companies analysis of four publicly traded live-event-ticketing peers (Vivid Seats, StubHub Holdings, CTS Eventim and Live Nation Entertainment) produced EV/CY2026E EBITDA multiples ranging from 6.3x to 17.3x (25th to 75th percentile of 7.2x to 11.0x), implying an enterprise value range of $126.1 million to $192.0 million for TFL, which the Transaction Consideration fell within. A precedent-transactions analysis of five live-event-ticketing and entertainment deals (including Silver Lake/Endeavor Group Holdings, Bending Spoons/Eventbrite, TKO Group/WWE, Vivid Seats/Wavedash and Endeavor/On Location Events) produced wider ranges that mostly placed the Transaction Consideration below the implied values. A discounted cash flow analysis using a 14.6% WACC produced an EBITDA-exit-multiple enterprise value range of $137.4 million to $211.2 million (within which the $147.845 million Transaction Consideration fell, $10.4 million above the low end) and a perpetuity-growth-method range of $85.9 million to $145.6 million (the Transaction Consideration fell above this range). Overall, of ten reference ranges Roth calculated, the Transaction Consideration fell within three, below six and above one. TFL's own forecast, per the Adjusted EBITDA schedule furnished to Roth, projected revenue of $229.9 million in 2026E, $250.0 million in 2027E and $280.0 million in 2028E, with Adjusted EBITDA of $17.4 million, $19.7 million and $22.1 million in those years (a roughly 7.6% CY2026E Adjusted EBITDA margin on management's forecast), versus Kustom's own standalone forecast of just $0.9 million of Adjusted EBITDA in FY2026E and $1.5 million in FY2027E on about $21 million of revenue. TFL generated over $238 million in revenue for full-year 2025, according to the September 1, 2026 press release. Roth received a $400,000 opinion fee and is entitled to a closing-contingent advisory fee equal to 1.25% of the Aggregate Consideration, estimated at approximately $1,848,000 before a credit for the opinion fee (about $1,448,000 after).
The Unit Purchase Agreement requires Kustom to obtain financing, potentially including a public securities offering, sufficient to fund the cash purchase price and debt payoff at closing; the agreement states Kustom makes no representation that such financing has been secured. Kustom's unaudited pro forma financial statements model this as a capital raise of $135.0 million used alongside other closing-date adjustments. No cost synergies, synergy dollar amounts, or expected EPS accretion/dilution figures are disclosed in the filings reviewed. At closing, one individual designated by TFL's sellers will be appointed to Kustom's board, TFL's executive leadership will enter long-term employment agreements with Kustom, and the sellers will be subject to five-year non-competition and non-solicitation covenants. Ancillary closing documents include an escrow agreement (a $500,000 purchase-price-adjustment escrow and a $1.0 million indemnification escrow), a registration rights agreement for the stock consideration, and lock-up agreements.
Closing is conditioned on, among other things, required third-party consents, the stockholder approvals described below, Kustom obtaining sufficient financing, and other customary conditions; there is no working-capital adjustment, though the agreement provides for a purchase-price adjustment tied to TFL's closing net debt and transaction expenses. Either party may terminate the agreement if closing has not occurred by October 15, 2026 (the "Outside Date"), which is automatically extended once by 15 days if Kustom files a Form S-1 registration statement before that date; a party cannot exercise this termination right if its own material breach was the principal cause of the delay. No specific termination fee is disclosed in the filings reviewed. At a special/annual meeting held October 5, 2026, Kustom stockholders approved all of the Nasdaq-rule-related proposals needed to proceed with the acquisition, including the issuance of 20%-or-more of outstanding shares under Nasdaq Rule 5635(a), the change-of-control issuance under Rule 5635(b), the issuance under Rule 5635(d), and an offering of shares to fund the cash portion of the purchase price; stockholders also approved an increase in authorized shares to 1,200,000,000 and a 2026 equity incentive plan. Separately, Kustom completed a 1-for-10 reverse stock split effective October 1, 2026. As of the most recent filings reviewed (through October 5, 2026), Kustom has not filed a closing 8-K, so the transaction has not been confirmed as completed.
Roth Capital Partners, LLC acted as exclusive financial advisor to Kustom and rendered the fairness opinion to its board. Sullivan & Worcester LLP served as legal counsel to Kustom, and Lewis Brisbois Bisgaard & Smith, LLP served as legal counsel to TFL, according to the background-of-the-acquisition narrative in Kustom's definitive proxy statement. The proxy's background section, which runs from an initial March 11, 2026 teleconference between the companies through the August 31, 2026 signing, does not describe any competing bidders or alternative transaction processes being run for TFL. No financial advisor to TFL is identified in the filings reviewed. The specific dollar amount of any termination fee, the pro forma post-closing ownership split between Kustom and TFL sellers, and whether the public offering financing condition has been satisfied remain undisclosed in the filings reviewed and should be monitored through subsequent SEC filings.