What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-12-29 compared with 2024-12-30 · 1092 added, 1083 removed, 1587 unchanged (58% of the section changed)

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in Internal Control Over Financial Reporting

the years ended September 30, 2024, and 2023, the Company engaged a third-party accounting firm to assist with entity level controls

around the review of period-end reporting processes, accounting policies and public disclosures that is reasonably likely to materially

affect our internal control over financial reporting.

was no change in our internal control over financial reporting that occurred in the year ended September 30, 2025, that has materially

affected, or is reasonably likely to materially affect, our internal control over financial reporting.

OTHER INFORMATION

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of the date of this Annual Report, the members of our Board of Directors and Executive Officers are:

of the Board of Directors,President,

Executive Officer, & Director

Name and Address

Chairman of the Board of Directors, President,

Chief Executive Officer, & Director

Hauppauge, NY 11788

Chief Financial Officer

Hauppauge, NY 11788

Manpreet Singh

Hauppauge, NY 11788

Metodi Filipov

Hauppauge, NY 11788

Occupations and Business Experience of Directors and Executive Officers

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and completed the PLD program at Harvard Business School.

Wyckoff was appointed Cemtrex’s Interim Chief Financial Officer on January 28, 2022, where he is responsible for the Company’s

Wyckoff was appointed Cemtrex’s Chief Financial Officer on January 6, 2025, where he is responsible for the Company’s

financial planning, accounting, tax, and business process functions.

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Old Westbury.

Kwon was appointed to the as a director on September 28, 2021 and is presently the President and Chief Procurement Officer of H Mart.

Brian has extensive operations experience in purchasing, distribution, logistics, IT, HR, and e-commerce from his time at H-Mart.

has completed the Harvard Business School General Management Program.

Kwon was appointed as a director on September 28, 2021 and is presently the President and Chief Procurement Officer of H Mart.

has extensive operations experience in purchasing, distribution, logistics, IT, HR, and e-commerce from his time at H-Mart.

completed the Harvard Business School General Management Program.

Singh was appointed as a director on November 1, 2021, and is currently the founder and Chief Investment Officer of Singh Capital Partners

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of Fortune 500 CXOs, Unicorn founders and operators and has executed investments in North America, Europe, and Asia.

He serves on the

numerous non-profit and private company boards including AcquCo, US Inspect, Embrace Software, Snowball Industries, Shukr Investments,

Suburban Hospital (John Hopkins Medicine) and Dingman Center at the Smith School of Business.

He is a CFA charterholder and Manpreet

received his MBA from the Wharton School of Business in Entrepreneurship, Finance, and Real Estate.

He serves on numerous

non-profit and private company boards including AcquCo, US Inspect, Embrace Software, Snowball Industries, Shukr Investments, Suburban

Hospital (John Hopkins Medicine), and Dingman Center at the Smith School of Business.

He is a CFA charterholder and Manpreet received

his MBA from the Wharton School of Business in Entrepreneurship, Finance, and Real Estate.

He also holds a B.S.

in Finance with

a citation in Entrepreneurship from the University of Maryland, College Park.

Singh’s extensive knowledge of finance allow

him to make valuable contributions to the Board.

in Finance with a citation

in Entrepreneurship from the University of Maryland, College Park.

Singh’s extensive knowledge of finance allows him to make

valuable contributions to the Board.

Filipov was appointed to the Board on February 9, 2018, and is an entrepreneur and technology executive with over 25 years of experience

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the past 10 years, other than as set forth below, none of our current directors, nominees for directors or current executive officers

has been involved in any legal proceeding identified in Item 401(f) of Regulation S-K, including:

have been involved in any legal proceeding identified in Item 401(f) of Regulation S-K, including:

Any petition under the Federal bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar

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authority over its members or persons associated with a member.

subsection titled “Settlement with the Securities and Exchange Commission” under Item 1.

Business of this Annual Report on

Form 10-K, which is incorporated herein by reference.

Board of Directors currently has one standing committee:

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members of the Board (Messrs.

Kwon, Singh, Wagner, and Filipov), rather than a nominating committee, approve or recommend to the full

Board those persons to be nominated.

The Board believes that the current method of nominating directors is appropriate because it allows

each independent board member input into the nomination process and does not unnecessarily restrict the input that might be provided

from an independent director who could be excluded from a committee.

Currently, three of the five Directors are independent.

the Board has adopted by resolution a director nomination policy.

The purpose of the policy is to describe the process by which candidates

for inclusion in the Company’s recommended slate of director nominees are selected.

The director nomination policy is administered

by the Board.

Kwon, Singh, and Filipov), rather than a nominating committee, approve or recommend to the full Board those

persons to be nominated.

The Board believes that the current method of nominating directors is appropriate because it allows each independent

board member input into the nomination process and does not unnecessarily restrict the input that might be provided from an independent

director who could be excluded from a committee.

Currently, three of the four Directors are independent.

Furthermore, the Board has adopted

by resolution a director nomination policy.

The purpose of the policy is to describe the process by which candidates for inclusion in

the Company’s recommended slate of director nominees are selected.

The director nomination policy is administered by the Board.

Many of the benefits that would otherwise come from a written committee charter are provided by this policy.

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which currently consists of Saagar Govil, the Chairman, Chief Executive Officer, President and Secretary, and Paul J.

Wyckoff, Interim

Wyckoff, CFO.

As of the date of this Annual Report, Saagar Govil and Paul J.

Wyckoff are currently earning compensation from the Company.

Wyckoff was named Interim CFO on January 28, 2022.

Set forth below is the aggregate compensation for services rendered in all capacities

to us during our fiscal years ended September 30, 2024, and 2023 by our executive officers.

Wyckoff was named CFO on January 6, 2025, after serving as interim CFO since January 28, 2022.

Set forth below is the aggregate compensation

for services rendered in all capacities to us during our fiscal years ended September 30, 2025, and 2024 by our executive officers.

PRINCIPAL AND POSITION

Chief Executive

and President

Chief Financial Officer

Executive Officer,

Financial Officer since January 2025

CFO since January 2022

Option Awards Column in the table above reflects the aggregate grant date fair value of the

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for more information relating to this option grant.

compensation are amounts paid by the company for medical, dental, vision, and life insurance

compensation represents amounts paid by the company for medical, dental, and vision, benefits.

TO SUMMARY COMPENSATION TABLE

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with them on terms and conditions usual and customary for the industry.

All amounts paid to our officers in fiscal year end 2024 were

approved by the Company’s board of directors.

The Company does not currently have “key man” life insurance on Mr.

All amounts paid to our officers in fiscal year ended September

30, 2025, were approved by the Company’s board of directors.

The Company does not currently have “key man” life insurance

VERSUS PERFORMANCE

Compensation Table Total for PEO

Actually Paid to PEO

Summary Compensation Table Total for Non-PEO NEOs

Compensation Actually Paid to Non-PEO NEOs

of Initial Fixed $100 Investment Based On Total Shareholder Return

Summary Compensation Table Total for PEO

Compensation Actually Paid to PEO

Average Summary Compensation Table Total for Non-PEO NEOs

Average Compensation Actually Paid to Non-PEO NEOs

Value of Initial Fixed $100 Investment Based On Total Shareholder Return

(28,292,520 )

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$ (9,233,438 )

$ (13,292,242 )

dollar amounts reported in column (b) are the amounts reported for Saagar Govil, Chairman

of the Board, CEO, President, and Secretary, for each of the corresponding years in the “Total”

column of the in our Summary Compensation Table.

Refer to the Summary Compensation Table

column in our Summary Compensation Table.

Refer to the Summary Compensation Table above.

dollar amounts reported in column (c) represent the amount of “compensation actually

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Table in each applicable year.

The names of each of the NEOs included for these purposes

in each applicable year are as follows:

Wyckoff, Interim Chief Financial Officer.

The names of the NEOs included for these purposes in each

applicable year are as follows:

Wyckoff, Chief Financial Officer (Interim Chief Financial

Officer prior to January 6, 2025).

dollar amounts reported in column (e) represent the average amount of “compensation

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statements for the applicable year.

to Determine Compensation

“Actually Paid”

for [PEO][Non-PEO NEOs]

for Change in

the Actuarial Present

v alues reported under

in Pension Value

and Nonaualified Deferred Comoensation

Earnimrn ”‘ Column

“Service Cost” for Pension

“Prior Service Cost” for Pension

for Amounts Reported

under the “ Stock

Awards ,, Column

for Amounts Reported

Column in t he

Fair Value of Awards Gran ted

during year that Remain

as of Year end

Fair Value of Awards Gran ted

that vest during vear

Increas e/deduction

for Change in Fair value from prior

Year-end to current

Year-end of Awards Granted Prior

to year that were Outstanding and

Unvested as of Year-end

$ (53,747.00 )

Increas e/deduction

for Change in Fair Value from Prior

Year-end to Vesting Date of

Awards Granted

Vested during

$ (29,381.00 )

of Fair v alue

of Awards Gran ted

were Forfeited during

Increase based

upon Incremental Fair Value

of Awards Modified during ye ar

based on Di vi dends

Earnings Paid

durilling year

to Determine Compensation “Actually Paid” for [PEO][Non-PEO NEOs]

Deduction for Change in the Actuarial Present

values reported under the “Change in Pension Value and “Nonqualified Deferred Compensation Earning” Column of

Increase for “Service Cost” for

Pension Plans

Increase for “Prior Service Cost”

for Pension Plans

Deduction for Amounts Reported under the “Stock

Awards”, Column in the SCT

Deduction for Amounts Reported under the “Option

Awards”, Column in the SCT

Increase for Fair Value of Awards Granted during

year that Remain Unvested as of Year end

Increase for Fair Value of Awards Granted during

year that vest during year

Increase/deduction for Change in

Fair value from prior Year-end to current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end

Increase/deduction for Change in Fair Value

from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year

Deduction of Fair value of Awards Granted Prior

to year that were Forfeited during year

Increase based upon Incremental Fair Value

of Awards Modified during year

Increase based on Dividends

or Other Earnings Paid during year prior to Vesting Date of Award

Total Adjustments

GRANTS IN THE LAST FISCAL YEAR

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following table presents information regarding our NEOs’ unexercised options to purchase Common Stock as of September 30, 2025:

of Securities Underlying Unexercised Options Exercisable

Number of Securities Underlying

Unexercised Options

Exercise Price

Expiration Date

$ 1,759,228.27

$ 2,100,630.00

$ 2,520,756.00

$ 3,024,907.20

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

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outstanding for the purpose of computing the percentage ownership of any other person.

Name and Address

Beneficial Owner

Chairman of the

276 Greenpoint Avenue, Suite

Chief Executive Officer,

Brooklyn, NY 11222

and President

Preferred Stock

Chairman of the Board,

276 Greenpoint Avenue, Suite

Chief Executive Officer,

Brooklyn, NY 11222

and President

Address of Beneficial Owner

1 Preferred Stock

Chairman of the Board,

276 Greenpoint Avenue, Suite

Chief Executive Officer,

Brooklyn, NY 11222

and President

Interim Chief Financial

276 Greenpoint Avenue, Suite

Brooklyn, NY 11222

276 Greenpoint Avenue, Suite

Brooklyn, NY 11222

C Preferred Stock

Manpreet Singh

276 Greenpoint Avenue, Suite 208

Brooklyn, NY 11222

Metodi Filipov

276 Greenpoint Avenue, Suite

Brooklyn, NY 11222

Hauppauge, NY 11788

All Directors and Executive

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above each share of Series C is entitled to 1,383.71 votes.

Series 1 Preferred Stock is

entitled to 2 votes per share.

Series 1 Preferred Stock is entitled

to 2 votes per share.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

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in this Annual Report on Form 10-K.

of September 30, 2024, and September 30, 2023, there was $0 and $3,806, respectively, payable due to Ducon Technologies, Inc., which

is controlled by Aron Govil, the Company’s Founder and Former Director and CFO.

As of September 30, 2023, there were $637,208 of

receivables due from Ducon Technologies, Inc.

of September 30, 2023, there were $637,208 of receivables due from Ducon Technologies, Inc., which is controlled by Aron Govil, the Company’s

Founder and Former Director and CFO.

The Company has negotiated a payment agreement regarding past receivables and other liabilities

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The Company did not receive payment on this note at the maturity date and placed a full allowance

on the note during fiscal year 2024 and appears on the Company’s Consolidated Statements of Operations and Comprehensive Loss under

general and administrative expenses.

February 26, 2021, the Company entered into a Settlement Agreement and Release with Aron Govil regarding a dispute over an alleged misappropriation

part of the Settlement Agreement, Mr.

Govil was required to pay the Company consideration with a total value of $7,100,000 (the “Settlement

Amount”) by entering into the Agreement.

The Settlement Amount was satisfied in a combination of Mr.

Govil forfeiting certain Preferred

Stock and outstanding options and executing a secured note in the amount of $1,533,280.

The Independent Board of Directors in coordination

with Management concluded the settlement represented fair value.

Govil also executed a secured promissory note (the “Note”) in the amount of $1,533,280.

The Note matured and was due in full

in two years and boar interest at 9% per annum and was secured by all of Mr.

Govil’s assets.

Govil also agreed to sign an affidavit

confessing judgment in the event of a default on the Note.

In accordance with ASC 450-30, Gain Contingencies, the Company determined

the gain will not be recognized until the note is paid.

Accordingly, the note and associated gain is not presented on the Company’s

Consolidated Balance Sheets and Consolidated Statements of Operations and Comprehensive Loss.

The Company has not received payment on

this note to date.

on the note during fiscal year 2024 with the charge recorded in general and administrative expenses on the Company’s Consolidated

Statements of Operations and Comprehensive Loss.

November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”)

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(formerly Cemtrex Labs), to Mr.

The successor Company conducts business under the name CXR, Inc.

to the on-going losses and risk associated with the SmartDesk business the Company has valued the royalty and SAFE agreement associated

with the SmartDesk sale at $0 and considers such consideration to be a gain contingency.

All receivables due from SmartDesk, Inc, have

a full allowance placed on them.

Based on sales projections for

Cemtrex XR, Inc., the Company does not believe that it will exceed the sales levels required to exceed the $820,000 royalties due and

has not accounted for any additional royalties at this time.

In accordance with ASC 310 – Receivables, the Company has discounted

the royalties due to $660,621 and during the years ended September 30, 2024, and 2023 the Company recognized $53,126 and $44,272 of royalties

due, respectively, and will amortize the remaining amount over the period the royalties are due.

Additionally, the Company received $76,000

in royalty payments.

As of September 30, 2024, there

was $685,788 in trade receivables due from CXR, Inc.

Of these receivables $60,628 are related to costs paid by Cemtrex related to payroll

during the transition of employees to the new company and some subscription services that are set up on auto pay with a credit card.

is related to the current amount of royalties due and the remaining $409,752 is related to services provided by Cemtrex Technologies Pvt.

January 6, 2025, the Company and Saagar Govil signed an agreement to revise the purchase price structure and payment terms.

Agreement’s Purchase Price provisions were amended to reflect that the Purchase Price will solely consist of the royalties based

on the actual revenues generated in the three years following closing.

The provision requiring the total sum of royalties to reach a

minimum of $820,000, with any shortfall to be paid by Purchaser, was removed from the Agreement.

Additionally,

it was agreed that the payment terms due under the royalties shall be as follows commencing on January 1, 2025:

Year (January 2025) Monthly Payment:

Year (January 2026) Monthly Payment:

Payment at the end of the Second Year (December 31, 2026):

Total outstanding royalties

transaction was approved by the Board of Directors with Saagar Govil abstaining from the vote.

on the new payment terms, management determined that it was appropriate to remove the previously recognized royalty receivable of $280,545

from the financial statements as of December 31, 2024.

The effect has been presented under the caption “(Loss)/income from discontinued operations, net of tax”

on the Company’s Consolidated Statements of Operations.

of September 30, 2025, there were royalties receivable from the sale of Cemtrex, XR, Inc.

of $460,475, of which $104,229 is

considered short-term and is presented on the Company’s Consolidated Balance Sheet under the caption

“Trade receivables, net – related party.

The remaining $190,475 is presented on the Company’s

Consolidated Balance Sheet under the caption “Trade receivables, net – Royalties receivable, net - related party.

Company has taken a $165,771 allowance for expected credit losses against these royalties.

of September 30, 2025, there was $405,493 in trade receivables due from the Cemtrex XR successor company, CXR, Inc.

Of these receivables

$104,229 is the short term due on the royalties on CXR Inc.’s revenues.

The remaining $301,264 is related to the services provided

by Cemtrex Technologies Pvt.

in the normal course of business.

These balances are presented on the Consolidated Balance Sheets under the caption “Trade

receivables - related party”.

The long-term balance of royalties of $456,611 is presented on the Company’s Consolidated Balance

Sheets under the caption “Note receivable, net - related party”.

During Fiscal year 2024, the Company recognized $665,520

of revenue from CXR, Inc.

During the year, the Company recorded $60,628 in current expected

credit losses on receivables due from CXR Inc.

May 5, 2025, Saagar Govil, CEO, made a short-term loan to the Company of $200,000 for certain operating needs.

This loan was repaid on

August 1, 2025.

Board of Directors has determined that Metodi Filipov, Brian Kwon, and Manpreet Singh are independent directors as defined by the listing

standards of The Nasdaq Stock Market and SEC rules.

Saagar Govil is not independent due to his position as an executive officer of the

PRINCIPAL ACCOUNTANT FEES AND SERVICES

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of our financial statements.

For fiscal year 2024, these fees primarily related to the review and consent for the S-1 filing related

to the May 2024 Equity Financing.

For fiscal year 2023, these fees primarily related to the audit of the historical financials of Heisey

Mechanical, Ltd.

For fiscal year 2025, these fees primarily related to the review and consent for the S-1 filing in January

2025, and the prospectus supplement filed in May 2025.

For fiscal year 2024, these fees primarily related to the review and consent for

the S-1 filing related to the May 2024 Equity Financing

fees consist of tax compliance services.

ITEM 15 EXHIBITS AND FINANCIAL STATEMENTS

15 EXHIBITS AND FINANCIAL STATEMENTS

Statements and Notes to the Consolidated Financial Statements

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Amendment to Certificate of Incorporation

Certificate of Designation of the Series A Preferred Shares

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Opinion of the Doney Law Firm

Amendment of the Term Loan Agreement between Vicon and NIL Funding, dated March 3, 2023

Amendment to Loan Documents Between Advanced Industrial Services, Inc.

and Fulton Bank, N.A.

Amendment to Promissory Note Between Cemtrex, Inc.

and Streeterville Capital, LL

Securities Purchase Agreement dated June 1, 2020

Securities Purchase Agreement dated June 9, 2020

Settlement Agreement and Release between Cemtrex, Inc.

and Aron Govil dated February 26, 2021

Securities Purchase Agreement dated February 22, 2022

Amendment of the Term Loan Agreement between Vicon and NIL Funding, dated March 30, 2022

Asset Purchase agreement between Cemtrex, Inc.

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Standstill Agreement, dated April 30, 2024

Underwriting Agreement, dated May 28, 2025 with Aegis Capital Corp.

Share Purchase Agreement between Cemtrex, Inc, Karl F.

Kiefer, and Invocon, Inc.

Securities Purchase Agreement, dated December 11, 2025

Subsidiaries of the Registrant

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Saagar Govil,

of the Board, CEO,

and Secretary (Principal Executive Officer)

CFO (Principal Financial and Accounting Officer)

Chairman of the Board,

President and Secretary

(Principal Executive Officer)

Chief Financial Officer

(Principal Financial and Accounting Officer)

to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf

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Saagar Govil,

of the Board, CEO,

and Secretary (Principal Executive Officer)

CFO (Principal Financial and Accounting Officer)

Chairman of the Board,

President and Secretary

(Principal Executive Officer)

Chief Financial Officer

(Principal Financial and Accounting Officer)

Manpreet Singh

Metodi Filipov

Metodi Filipov,

to the Consolidated Financial Statements

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Consolidated Statements of Operations for the Fiscal Years Ended September 30, 2025 and 2024

Consolidated Statement of Comprehensive Loss for the Fiscal Years Ended September 30, 2024 and 2023

Consolidated Statements of Comprehensive Loss for the Fiscal Years Ended September 30, 2025 and 2024

Consolidated Statements of Shareholders’ Equity for the Fiscal Years Ended September 30, 2025 and 2024

Consolidated Statement of Cash Flows for Fiscal Years Ended September 30, 2024 and 2023

Consolidated Statements of Cash Flows for Fiscal Years Ended September 30, 2025 and 2024

Notes to the Consolidated Financial Statements

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and Subsidiaries (the “Company”) as of September

30, 2024 and 2023, and the related consolidated statements of operations, comprehensive loss, stockholders’ equity, and cash flows

for each of the years in the two-year period ended September 30, 2024, and the related notes (collectively referred to as, the “financial

30, 2025 and 2024, and the related statements of operations, comprehensive loss, stockholders’ equity, and cash flows for each

of the years in the two-year period ended September 30, 2025, and the related notes (collectively referred to as the “financial

statements”).

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As described in Note

1 to the financial statements, the Company has sustained net losses and has significant short-term debt obligations, which raise substantial

1 of the financial statements, the Company has sustained net losses and has significant short-term debt obligations, which raise substantial

doubt about its ability to continue as a going concern.

Management’s plans in regard to these matters are described in Note 1.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Our opinion is not modified

with respect to this matter.

Managements plans in regard to these matters are described in Note 1.

The financial

statements do not include any adjustments that might result from the outcome of this uncertainty.

Our opinion is not modified with respect

to this matter.

financial statements are the responsibility of the Company’s management.

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provide a reasonable basis for our opinion.

and Subsidiaries

Audit Matters

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matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

of the matter

September 30, 2024, the Company had approximately $3.7 million of goodwill.

As discussed in Note 2 to the financial statements, goodwill

is tested annually for impairment at the reporting unit level, or more frequently if impairment indicators arise.

the Company’s goodwill impairment analyses was complex and highly judgmental due to the nature of qualitive assessment and, where

necessary, the significant estimation required to determine the fair value of the reporting units.

In particular, the fair value estimate

was sensitive to significant assumptions, such as future operating results, cash flows and the weighted average cost of capital.

significant assumptions are forward-looking and could be materially affected by future market or economic conditions.

we addressed the matter

obtained an understanding of controls over the Company’s goodwill impairment evaluation process, including controls over management’s

review of the significant assumptions described above.

audit procedures to test the Company’s goodwill impairment analyses included

the reasonableness of the Company’s qualitative assessments and its estimated fair

value of the reporting units.

evaluating the estimated fair value of reporting units, we, among other items, evaluated

management’s significant assumptions described above and used within the fair value

method, and tested the completeness and accuracy of the underlying data.

involved our valuation specialists to assist in assessing fair valuation methodologies utilized

in the Company’s goodwill impairment analyses and to assist in evaluating certain assumptions

utilized in the analyses, including discount rates.

assessed the historical accuracy of management’s projected cash flows, where applicable,

and performed sensitivity analyses of the significant assumptions to evaluate the changes

in the fair value of the reporting units that would result from changes in the assumptions.

assessed the adequacy of the disclosures in the financial statements.

Party Receivables

of Related Party Receivables

of the matter

September 30, 2024, the Company had approximately $1.2 million of related party receivables.

These receivables are made up of $0.5 million

of trade receivables, and $0.7 million of royalty receivable.

The related party nature of these receivables and associated disclosures

are material to the financial statements and of a highly sensitive nature.

we addressed the matter

September 30, 2025, the Company had approximately $0.6 million of related party receivables, and includes $0.2 million in allowances

for credit losses.

These receivables are made up of $0.1 million of trade receivables, and $0.5 million of royalty receivable.

The related party nature of these receivables and valuation of these receivables are material to the financial statements and of a highly

sensitive nature.

the Critical Audit Matter was addressed in the Audit

obtained an understanding of controls over the Company’s accounting and disclosures for related party transactions.

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an understanding of certain related party transaction by reading relevant agreements, as

certain instance, obtaining confirmations from the related parties to affirm the existence

of the open receivable and personal guarantees, as applicable;

other audit procedures on certain open balances including, among other things, vouching to

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of such receivables;

managements allowance for credit losses related to these receivables and the assumptions

and inputs used in their assessment;

subledgers and documentation obtained in other audit areas for known related parties;

we evaluated the Company’s disclosures related to the matters described above.

Classification,

Presentation, Accounting treatment and Valuation of Warrants

and Subsidiaries

described in Note 18 to the consolidated financial statements, the Company entered into an Underwriting Agreement to issue and sell common

stock and series A, B, and pre-funded warrants during 2024.

We identified the evaluation of the classification, presentation, accounting

treatment and fair value of warrants issued as a critical audit matter.

principal consideration for our determination that the evaluation of the classification, presentation, accounting treatment and fair

value of the warrants issued was a critical audit matter is the high degree of subjective auditor judgment associated with evaluating

management’s determination of the liability classification and fair values of the warrants issued, which is primarily due to the

underlying terms of the agreement and complexity of the valuation models used and the sensitivity of the underlying significant assumptions.

We identified the fair value of the Series B warrants revaluation as a critical

audit matter.

principal consideration for our determination that the evaluation of the fair value of the warrants was a critical audit matter is the

high degree of subjective auditor judgment associated with evaluating management’s determination of the fair values of the warrants

issued, which is primarily due to the complexity of the valuation models used and the sensitivity of the underlying significant assumptions.

The key assumptions used within the valuation models included the risk-free rate, stock price, strike price, remaining term, and volatility.

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the Critical Audit Matter was addressed in the Audit

audit procedures related to the evaluation of acquisition date fair values of the warrants issued included the following, among others:

read and reviewed the relevant agreements to agree to key terms of the warrants issued to

determine the accuracy of the warrants issued and proper classification, presentation, and

accounting treatment.

vouched to source documentation to validate warrants issued.

assessed the qualifications and competence of management and the qualifications, competence

and objectivity of third-party specialists.

audit procedures related to the evaluation of the fair value of the warrants included the following, among others:

assessed the qualifications and competence of management.

evaluated the methodologies used to determine the fair values of the warrants issued.

tested the assumptions used within the valuation models to estimate the fair value of the

warrants issued.

evaluated the design and operating effectiveness of certain controls over the valuation process,

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stock price, strike price, remaining term, and volatility.

involved an internal valuation specialist who assisted in the evaluation and testing performed

of the reasonableness of significant methods and assumptions to the models.

assessed the sufficiency of the Company’s disclosure of its accounting for these warrants

issued included in Note 18.

issued in Note 18.

GRASSI & Co., CPAs, P.C.

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net - related party

Trade receivables,

expenses and other current assets

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Property and equipment, net

Right-of-use operating lease

Royalties receivable, net -

related party

Note receivable, net - related

Right-of-use operating lease assets

Royalties receivable, net - related party

Digital assets

& Stockholders’ Equity

Current liabilities

payable - related party

line of credit

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from customers

payable on inventory in transit

Total current

6 unchanged sentences

Preferred stock, $ 0.001

par value, 10,000,000 shares authorized, Series 1, 3,000,000 shares authorized, 2,456,827 shares issued and 2,392,727 shares outstanding

as of September 30, 2024 and 2,293,016 shares issued and 2,228,916 shares outstanding as of September 30, 2023 (liquidation value

of $ 10 per share)

C, 100,000 shares authorized, 50,000 shares issued and outstanding at September 30, 2024 and September 30, 2023

par value, 10,000,000

shares authorized, Series 13,000,000

shares authorized, 2,705,327

shares issued and 2,641,227

shares outstanding as of September 30, 2025 and 2,456,827

shares issued and 2,392,727

shares outstanding as of September 30, 2024 (liquidation value of $ 10

Series C, 100,000 shares

authorized, 50,000 shares issued and outstanding at September 30, 2025, and September 30, 2024

Common stock, $ 0.001 par

value, 70,000,000 shares authorized, 14,176 shares issued and outstanding at September 30, 2024 and 50,000,000 shares authorized,

498 shares issued and outstanding at September 30, 2023

paid-in capital

value, 70,000,000 shares authorized, 830,606 shares issued and outstanding at September 30, 2025, and 946 shares issued and outstanding

at September 30, 2024

Additional paid-in capital

Accumulated deficit

( 99,397,741 )

1 unchanged sentence

Treasury stock, 64,100 shares

of Series 1 Preferred Stock at September 30, 2024, and September 30, 2023

other comprehensive income

of Series 1 Preferred Stock at September 30, 2025,

Accumulated other comprehensive

Cemtrex stockholders’ equity

5 unchanged sentences

the year ended

Services Revenue

Cost of revenues

Cost of revenues, Security

Cost of revenues, Industrial Services

Operating expenses

2 unchanged sentences

operating expenses

income/(loss)

( 5,269,745 )

Other income/(expense)

Other income/(expense),

Interest expense

( 2,110,726 )

Other (expense)/income

Other(expense)/income,

( 2,169,469 )

Changes in fair value of

digital assets

Loss on exercise

of warrant liabilities

( 15,088,812 )

excess fair value of warrants

( 7,255,528 )

in fair value of warrant liability

Changes in fair value of

warrant liability

( 10,933,412 )

other income/(expense), net

( 27,823,914 )

before income taxes

( 2,206,604 )

Net loss before income

( 27,314,088 )

Continuing operations

( 7,476,349 )

Loss from continuing operations

( 28,048,968 )

Income/(loss)

from discontinued operations, net of tax

( 7,678,629 )

(Loss)/income from discontinued

operations, net of tax

( 28,292,520 )

( 7,635,505 )

loss in noncontrolling interest

Less net loss in noncontrolling

loss attributable to Cemtrex, Inc.

1 unchanged sentence

$ ( 7,229,491 )

(Loss)/income per share - Basic & Diluted

$ ( 15,760.64 )

Weighted Average Number

of Shares-Basic & Diluted

Income/(loss) per share - Basic & Diluted

Weighted Average Number of Shares-Basic

and Subsidiaries

STATEMENT OF COMPREHENSIVE LOSS

STATEMENTS OF COMPREHENSIVE LOSS

the year ended

2 unchanged sentences

$ ( 7,635,505 )

currency translation (loss)/gain

currency translation loss

Comprehensive

1 unchanged sentence

( 7,762,914 )

Comprehensive

loss attributable to noncontrolling interest

Comprehensive

loss attributable to Cemtrex, Inc.

net loss in noncontrolling interest

Comprehensive loss attributable

to Cemtrex, Inc.

$ ( 28,470,325 )

3 unchanged sentences

STATEMENTS OF STOCKHOLDERS’ EQUITY

Preferred Stock

Treasury Stock,

64,100 shares of Series 1

Accumulated other

Stock Series 1

Stock Series C

Stock, 64,100 shares of

Comprehensive

Stockholders’

at September 30, 2023

September 30, 2024

$ ( 71,355,386 )

$ ( 148,291 )

Foreign currency translation

Foreign currency translation loss

Share-based compensation

Dividends paid in Series 1

preferred shares

Purchase of treasury stock

Cancellation of treasury stock

Shares issued to pay for services

Exercise of prefunded warrants

Dividends paid in Series 1 preferred shares

Cancelation of 3,778 shares of Series 1 Preferred Shares

Shares issued to pay debt

Exercise of Series A warrants

Exercise of Series B warrants

Shares issued in offering

Shares issued in over allotment exercise

Issuance of roundup shares

Loss attributable to noncontrolling

Loss attributable to noncontrolling interest

Elimination of noncontrolling interest

( 28,112,368 )

at September 30, 2024

Balance at September

$ 105,668,565

$ ( 99,397,741 )

$ ( 148,291 )

accompanying notes are an integral part of these consolidated financial statements.

1 unchanged sentence

STATEMENTS OF STOCKHOLDERS’ EQUITY

Preferred Stock

Treasury Stock,

64,100 shares of Series 1

Accumulated other

Stock Series 1

Stock Series C

Stock, 64,100 shares of

Comprehensive

Stockholders’

at September 30, 2022

$ ( 54,929,020 )

$ ( 148,291 )

September 30, 2023

$ ( 64,125,895 )

$ ( 148,291 )

Foreign currency translation

currency translation (loss)/gain

Foreign currency translation loss

Share-based compensation

Shares issued to pay notes

Dividends paid in Series 1

preferred shares

Income/(loss) attributable

to noncontrolling interest

Dividends paid in Series 1 preferred shares

Purchase of treasury stock

Cancellation of treasury stock

Shares issued to pay for services

Additional rounding shares

issued for reverse stock split

( 9,196,875 )

at September 30, 2023

Exercise of prefunded warrants

Exercise of Series A warrants

Issuance of roundup shares

Loss attributable to noncontrolling interest

( 7,229,491 )

Balance at September

$ ( 71,355,386 )

3 unchanged sentences

STATEMENTS OF CASH FLOWS

Cash Flows from Operating Activities

For the year ended

3 unchanged sentences

$ ( 7,635,505 )

Adjustments to reconcile net loss to net cash used by operating activities

Adjustments to reconcile

net loss to net cash used by operating activities

Depreciation and amortization

(Gain)/loss on disposal of property and equipment

Loss/(gain) on disposal

of property and equipment

Noncash lease expense

Goodwill impairment

Bad debt expense (recovery)

Loss on write-off of related party receivables

Bad debt recovery

Loss on write-off of related

party receivables

Contract modification -

related party

Share-based compensation

Shares issued to pay for services

Interest expense paid in equity shares

Accrued interest on notes payable

Shares issued to pay for

Interest expense paid in

equity shares

Accrued interest on notes

Non-cash royalty income

Amortization of original issue discounts on notes payable

Amortization of loan origination costs

Loss on excess fair value of warrants

Changes in fair value of warrant liability

Amortization of original

issue discounts on notes payable

Loan origination costs

Receipt of SOL from staking

Non-cash transaction fees

Unrealized gain on digital

Loss on excess fair value

Changes in fair value of

warrant liability

( 7,840,951 )

Changes in operating assets and liabilities net of effects from acquisition of subsidiaries:

Changes in operating assets

and liabilities net of effects from acquisition of subsidiaries:

Trade receivables

1 unchanged sentence

( 1,870,975 )

Trade receivables - related party

( 1,099,070 )

Trade receivables - related

Contract assets

Prepaid expenses and other current assets

Prepaid expenses and other

current assets

Accounts payable

Accounts payable - related party

Sales tax payable

5 unchanged sentences

Income taxes payable

Other liabilities

Net cash used by operating activities - continuing operations

( 3,949,360 )

( 4,724,305 )

Net cash provided by operating activities - discontinued operations

Net cash used by operating activities

( 3,949,360 )

cash provided by/(used in) operating activities

( 3,949,360 )

Cash Flows from Investing Activities

Purchase of property and equipment

Flows from Investing Activities

Purchase of property and

( 1,931,534 )

( 1,297,346 )

Proceeds from sale of property and equipment

Royalties on related party revenues

Acquisitions, Net of Cash Acquired

Proceeds from sale of property

and equipment

Royalties on related party

Purchase of digital assets

in MasterpieceVR

cash used by investing activities

( 2,960,739 )

Investment in MasterpieceVR

Net cash used by investing activities

( 1,257,393 )

Flows from Financing Activities

Proceeds on revolving line

Payments on revolving line

( 33,093,412 )

Cash Flows from Financing Activities

Proceeds on revolving line of credit

Payments on revolving line of credit

( 30,019,244 )

2 unchanged sentences

( 7,923,914 )

Payments on Paycheck Protection Program Loans

Payments on Paycheck Protection

Program Loans

Proceeds on Loan from CEO

Payments on Loan from CEO

Proceeds on bank loans

Proceeds from notes payable

Purchases of treasury stock

Proceeds from warrant exercises

Proceeds from offerings

Expenses on offerings

Net cash provided by financing activities

of treasury stock

cash provided by financing activities

Effect of currency translation

Net decrease in cash, cash equivalents, and restricted cash

( 5,824,469 )

Cash, cash equivalents, and restricted cash at beginning of period

Cash, cash equivalents, and restricted cash at end of period

Net increase/(decrease)

in cash, cash equivalents, and restricted cash

cash equivalents, and restricted cash at beginning of period

cash equivalents, and restricted cash at end of period

accompanying notes are an integral part of these consolidated financial statements.

1 unchanged sentence

STATEMENTS OF CASH FLOWS

Balance Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash

Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents, and restricted cash

Supplemental Disclosure of Cash Flow Information:

Cash paid during the period for interest

Cash paid during the period for income taxes, net of refunds

Supplemental Schedule of Non-Cash Investing and Financing Activities

Shares issued to pay notes payable

Financing of fixed asset purchase

Financing of building purchase

Financing of acquisition

Purchase of property and equipment through vendor financing

Noncash recognition of new leases

cash, cash equivalents, and restricted cash

For the year ended

September 30,

Disclosure of Cash Flow Information:

during the period for interest

Cash paid during the

period for income taxes, net of refunds

Schedule of Non-Cash Investing and Financing Activities

Shares issued to pay

notes payable

Financing of fixed asset

Noncash recognition

of new leases

Noncash dividends

Series A Warrant Exercises

Series B Warrant Exercises

accompanying notes are an integral part of these consolidated financial statements.

11 unchanged sentences

Stock Reverse Stock Split

October 2, 2024, and November 26, 2024, the Company completed a 60:1 and 35:1 , respectively, reverse stock split on its common stock.

October 2, 2024, November 26, 2024, and September 29, 2025, the Company completed a 60:1 , 35:1 , and 15:1 respectively, reverse stock

split on its common stock.

All share and per share data have been retroactively adjusted for the reverse splits.

Notices for Listing Deficiencies

July 29, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”)

notifying the Company that, because the closing bid price for the Company’s Series 1 Preferred Stock listed on Nasdaq was below

$ 1.00 for 30 consecutive trading days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq

Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $ 1.00 per share (the “Minimum Bid Price

Requirement”).

On January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq

notifying the Company that, it had been granted an additional 180 days or until July 24, 2023, to regain compliance with the Minimum

Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all

other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s

written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

On September 8, 2023, the Company received a letter from the Nasdaq Hearings Panel (“Panel”) informing the Company that the

Panel has granted the Company a temporary exception to regain compliance with The Nasdaq Stock Market LLC’s (“Nasdaq”

or the “Exchange”) Listing Rule 5555(a)(1) (the “Bid Price Rule”) by

no later than January 19, 2024.

The Company has announced a special meeting of Series 1 Preferred Stock

shareholders was scheduled for December 26, 2023, to approve the reverse stock split.

On December 26, 2023, the meeting was adjourned

to December 29, 2023, due to insufficient votes represented by proxy or virtually in person to constitute a quorum for the transaction

of business at the Special Meeting.

On December 29, 2023, there were still insufficient votes represented by proxy or virtually in person

to constitute a quorum thus the resolution did not pass.

January 5, 2024, and January 12, 2024, the Company bought back an aggregate of 71,951 shares of Series 1 Preferred Stock for $ 69,705

under the Share Repurchase Program approved on August 22, 2023, that allows the Company to repurchase shares of the Series 1 Preferred

Stock through various means, including through privately negotiated transactions and through an open market program.

On April 8, 2024,

these shares were cancelled.

The Company’s Series 1 Preferred Stock was delisted from the NASDAQ Capital Market on January 22,

The Series 1 Preferred Stock is now quoted on the OTC Markets under the symbol “CETXP”.

Nasdaq filed a Form 25 on March

21, 2024, and the deregistration of the Company’s Series 1 Preferred Stock under Section 12(b) of the Exchange Act became effective

for 90 days after filing of the Form 25.

June 14, 2024, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company

3 unchanged sentences

The notification letter also disclosed that in the event the Company

does not regain compliance with the Minimum Bid Price Requirement by December 11, 2024, the Company may be eligible for additional time.

To qualify for additional time, the Company would be required to meet the continued listing requirement for market value of publicly

held shares and all other initial listing standards for The Nasdaq Capital Market, with the exception of the bid price requirement, and

would need to provide written notice of its intention to cure the deficiency during the second compliance period, by effecting a reverse

stock split, if necessary.

On August 21, 2024, the Company received a notification letter from the Listing Qualifications Department of Nasdaq

notifying the Company that, because the stockholder’s equity for the Company was below $2,500,000 as reported on our Form 10-Q

for the period ended June 30, 2024, the Company no longer meets the minimum shareholder’s equity requirement for continued listing

on The Nasdaq Capital Market under Nasdaq Marketplace Rule 5550(b)(1), requiring a minimum stockholder’s equity of $2,500,000 (the

“Minimum Stockholder’s Equity Requirement”).

October 23, 2024, the Company received a letter from Nasdaq that it had been granted an extension to regain compliance with the Minimum

Stockholder’s Equity Requirement.

terms of the extension are as follows:

on or before February 17, 2025, the Company must complete the submitted plan and opt for one of

the two following alternatives to evidence compliance with the Rule:

The Company must furnish to the SEC and Nasdaq a publicly available report (e.g., a Form

8-K) including:

disclosure of Staff’s deficiency letter and the specific deficiency(ies) cited;

description of the completed transaction or event that enabled the Company to satisfy the

stockholders’ equity requirement for continued listing;

affirmative statement that, as of the date of the report, the Company believes it has regained

compliance with the stockholders’ equity requirement based upon the specific transaction

or event referenced in Step 2;

disclosure stating that Nasdaq will continue to monitor the Company’s ongoing compliance

with the stockholders’ equity requirement and, if at the time of its next periodic

report the Company does not evidence compliance, that it may be subject to delisting.

The Company must furnish to the SEC and Nasdaq a publicly available report including:

1 & 2 set forth above;

balance sheet no older than 60 days with pro forma adjustments for any significant transactions

or event occurring on or before the report date.

The pro forma balance sheet must evidence

compliance with the stockholders’ equity requirement;

disclosure that the Company believes it also satisfies the stockholders’ equity requirement

as of the report date and that Nasdaq will continue to monitor the Company’s ongoing

compliance with the stockholders’ equity requirement and, if at the time of its next

periodic report the Company does not evidence compliance, that it may be subject to delisting.

of which alternative the Company chooses, if the Company fails to evidence compliance upon filing its periodic report for the March 31,

2025, with the SEC and Nasdaq, the Company may be subject to delisting.

2024 Equity Financing and Warrants

May 1, 2024, the Company entered into an underwriting agreement with Aegis Capital Corp., in connection with a firm commitment underwritten

public offering of warrants convertible into the Company’s common stock.

Further details can be found in Note 18 – Stockholders’

does not regain compliance with the Minimum Bid Price Requirement by December 11, 2024.

On December 11, 2024, we received a notification

letter from the Nasdaq notifying us that we have regained compliance with the Minimum Bid Requirement.

we currently meet the Nasdaq Minimum Bid Requirement, out of abundance of caution, we believe that a future reverse split may be necessary

in the future if we were to fall short of the Minimum Bid Price Requirement.

A Reverse Stock Split would potentially increase our bid

price such that we maintain the Minimum Bid Requirement required for maintaining the listing requirements for the Nasdaq Capital Market.

August 21, 2024, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company

that, because the stockholder’s equity for the Company was below $2,500,000 as reported on our Form 10-Q for the period ended June

30, 2024, the Company no longer meets the minimum shareholder’s equity requirement for continued listing on The Nasdaq Capital

Market under Nasdaq Marketplace Rule 5550(b)(1), requiring a minimum stockholder’s equity of $2,500,000 (the “Minimum Stockholder’s

Equity Requirement”).

October 23, 2024, the Company received a letter from Nasdaq that it had been granted an extension to February 17, 2025, to regain compliance

with the Minimum Stockholder’s Equity Requirement.

January 2, 2025, the Company received a letter from Nasdaq notifying the Company that based on the Company’s Form 10-K filed on

December 30, 2024, evidencing stockholders’ equity of $ 4,710,677 , Nasdaq has determined that the Company complies with the Minimum

Stockholder’s Equity Requirement and this matter is now closed.

February 24, 2025, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company

that, because the stockholder’s equity for the Company was below $ 2,500,000 as reported on our Form 10-Q for the period ended December

31, 2024, the Company no longer meets the minimum shareholder’s equity requirement for continued listing on The Nasdaq Capital

Market under Nasdaq Marketplace Rule 5550(b)(1), requiring a minimum stockholder’s equity of $ 2,500,000 (the “Minimum Stockholder’s

Equity Requirement”).

and Subsidiaries

April 22, 2025, the Company received a letter from Nasdaq that it had been granted an extension to August 20, 2025, to regain compliance

with the Minimum Stockholder’s Equity Requirement.

June 4, 2025, the Company received a letter from Nasdaq notifying the Company that based on the Company’s Form 10-Q for the period

ended March 31, 2025, filed on May 15, 2025, evidencing stockholders’ equity of $ 6,403,022 , Nasdaq has determined that the Company

complies with the Minimum Stockholder’s Equity Requirement and this matter is now closed.

Concern Considerations

2 unchanged sentences

The going concern basis of presentation

assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to

assumes that the Company will continue in operation one year after the date these financial statements are issued or available to be issued will be able to

realize its assets and discharge its liabilities and commitments in the normal course of business.

21 unchanged sentences

and introducing new innovative products to grow revenues, (iii) raised $ 12,478,957 in net proceeds through our May 2024 equity financing,

and anticipate an additional $ 5 to $ 10 million when the Series B warrants are exercised.;

and (iv) subsequent to the balance sheet date

has effected a 60:1 and a 35:1 reverse stock split on our common stock to remain trading on the Nasdaq Capital Markets, and improve our

ability to potentially raise capital through equity offerings that we may use to satisfy debt.

In the event additional capital is raised

through equity offerings and/or debt is satisfied with equity, it may have a dilutive effect on our existing stockholders.

Company believes these plans if successful, would be sufficient to meet the capital demands of our current operations for at least the

next twelve months, there is no guarantee that we will succeed.

Overall, there is no guarantee that cash flow from our existing or future

operations and any external capital that we may be able to raise will be sufficient to meet our working capital needs.

The Company currently

does not have adequate cash or available liquidity/available capacity on our lines of credit to meet our long-term needs and our above

plans in the short term may prove to be inadequate to continue as a going concern.

Thus, despite our cash on hand, our ability to draw

on our credit line, or changes to our pricing models, and other safeguards, we may be unable to meet our obligations as they become due

over the next twelve months beyond the issuance date.

raised another $ 5,657,264 subsequent to the balance sheet date and anticipate an additional $ 2.4 million when the Series B warrants are

(iv) satisfied $ 7,844,000 of notes payable through equity issuances, and (v) ) raised approximately 1.2 million in net proceeds

from our May 2025 equity offering, and another $ 3,900,000 through a subsequent offer in December 2025, and (vi) effected a 60:1 , 35:1 ,

and 15:1 reverse stock split on our common stock to remain trading on the Nasdaq Capital Markets, and improve our ability to potentially

raise capital through equity offerings that we may use to satisfy debt.

In the event additional capital is raised through equity offerings

and/or debt is satisfied with equity, it may have a dilutive effect on our existing stockholders.

While the Company believes these plans

if successful, would be sufficient to meet the capital demands of our current operations for at least the next twelve months, there is

no guarantee that we will succeed.

Overall, there is no guarantee that cash flow from our existing or future operations and any external

capital that we may be able to raise will be sufficient to meet our working capital needs.

The Company currently does not have adequate

cash or available liquidity/available capacity on our lines of credit to meet our long-term needs and our above plans in the short term

may prove to be inadequate to continue as a going concern.

Thus, despite our cash on hand, our ability to draw on our credit line, or

changes to our pricing models, and other safeguards, we may be unable to meet our obligations as they become due over the next twelve

months beyond the issuance date.

and Subsidiaries

there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will

22 unchanged sentences

of Consolidation

consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Cemtrex Technologies Pvt.

and Advanced Industrial Services, Inc.

and the Company’s majority owned subsidiary Vicon Industries, Inc.

and its subsidiary, Vicon

Systems, Ltd.

All inter-company balances and transactions have been eliminated in consolidation.

consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Vicon Security Technologies Pvt

(formerly Cemtrex Technologies Pvt.

Ltd.), Advanced Industrial Services, Inc.

During fiscal 2025, the Company obtained 100% ownership

of its subsidiary Vicon Industries, Inc.

and its subsidiary, Vicon Systems, Ltd.

All inter-company balances and transactions have been

eliminated in consolidation.

Value, Recoverability, and Impairment of Long-Lived Assets

10 unchanged sentences

impairment charges, if any, are included in operating expenses in the accompanying Consolidated Statements of Operations.

and Subsidiaries

Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents.

32 unchanged sentences

SCHEDULE OF PROPERTY PLANT AND EQUIPMENT

and office equipment

and equipment

Estimated Useful Life

Furniture and office equipment

Computer software

Machinery and equipment

sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain

or loss is reflected in the Consolidated Statements of Operations.

is tested for impairment annually as of September 30.

If circumstances change during interim periods between annual tests that would

more likely than not reduce the fair value of a reporting unit below its carrying value, the Company will test goodwill for impairment.

Factors that would necessitate an interim goodwill impairment assessment include prolonged negative industry or economic trends, or significant

under-performance relative to expected, historical or projected future operating results.

Management uses judgment to determine whether

to use a qualitative analysis or a quantitative fair value measurement for its goodwill impairment testing.

The Company’s fair

value measurement approach combines the income and market valuation techniques for each of the Company’s reporting units that carry

These valuation techniques use estimates and assumptions including, but not limited to, the determination of appropriate market

comparable, projected future cash flows (including timing and profitability), discount rate reflecting the risk inherent in future cash

flows, perpetual growth rate, and projected future economic and market conditions.

As permitted, if the reporting unit fails the impairment

test, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standard Update (“ASU”) removing

step two from the goodwill impairment test.

If a reporting unit fails the quantitative impairment test, impairment expense is immediately

recorded as the difference between the reporting unit’s fair value and carrying value.

the year ended September 30, 2024, the Company recorded $ 530,475 of impairment for Goodwill in the Security Segment.

For the year September

30, 2023, no impairment of the Company’s goodwill was recorded.

and Subsidiaries

Company accounts for crypto assets in accordance with ASU 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60) :

Accounting for and Disclosure of Crypto Assets, which requires entities to measure certain crypto assets at fair value with changes recognized

in the condensed consolidated statement of operations for each reporting period.

The Company’s crypto assets, Bitcoin and Ethereum

Classic, which have not been determined to be stablecoins or derivatives, are within the scope of ASU 2023-08.

The Company has deemed

the price of crypto assets to be a Level 1 input under ASC 820 hierarchy as these were based on observable quoted prices in the Company’s

principal market for identical assets.

Market and Fair Value Determination

determine which market is the Company’s principal market (or in the absence of a principal market, the most advantageous market)

for purposes of determining fair value of individual digital assets, the Company follows ASC 820, Fair Value Measurement, which outlines

the application of fair value accounting.

ASC 820 determines fair value to be the price that would be received for digital assets in

a current sale, which assumes an orderly transaction between market participants on the measurement date.

ASC 820 requires the Company

to assume that the digital asset is sold in its principal market to market participants or, in the absence of a principal market, the

most advantageous market.

Market participants are defined as buyers and sellers in the principal or most advantageous market that are

independent, knowledgeable, and willing and able to transact.

Company transacts in a Brokered Market, a Dealer Market, Principal-to-Principal Markets and Exchange Markets, each as defined in the

FASB Master Glossary (collectively, “Digital Asset Markets”).

In determining which of the eligible Digital Asset Markets

is the Company’s principal market, the Company reviews these criteria in the following order:

the Company determines which Digital Asset Markets for the relevant digital asset are accessible to the Company.

the Company sorts the remaining Digital Asset Markets from high to low by market-based volume of the digital asset traded on each Digital

Asset Markets in the trailing twelve months.

the Company then selects a Digital Asset Market as its principal market based on the highest market-based volume in comparison to the

other Digital Asset Markets on the list.

Company determines its principal market (or in the absence of a principal market, the most advantageous market) annually to determine

(i) if there have been recent changes to each Digital Asset Market’s trading volume in the trailing twelve months, (ii) if any

Digital Asset Markets have developed that the Company has access to, or (iii) if recent changes to each Digital Asset Market’s

price stability have occurred that would materially impact the selection of the principal market and necessitate a change in the Company’s

determination of its principal market.

Company’s Solana is recorded at fair value, as determined using the period-end closing price at 11:59:59 UTC and changes in fair

value are recognized as change in fair value of digital assets on the condensed consolidated Statements of Operations.

Goodwill is recorded when the purchase price paid for an acquisition

exceeds the estimated fair value of the net identified tangible and intangible assets acquired.

The Company evaluates its goodwill for

impairment in accordance with ASC 350, Intangibles - Goodwill and Other (as amended by ASU 2017-04), by assessing qualitative factors

to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of a reporting unit

is less than its carrying amount, including goodwill.

The Company performs the quantitative goodwill impairment test, if, after assessing

the totality of events or circumstances such as those described in paragraph ASC 350-20-35-3C(a) through (g), the Company determines that

it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

An impairment charge is recognized

for the amount by which the carrying amount exceeds the reporting unit’s fair value, limited to the total amount of goodwill related

to the reporting unit.

and Subsidiaries

The Company tests the recorded amount of goodwill for impairment on

an annual basis on September 30 of each fiscal year or more frequently if there are indicators that the fair value of the goodwill exceeds

its carrying amount.

The Company has two reporting units.

The Company performed a qualitative assessment and concluded that no impairment

existed as of September 30, 2025.

For the year ended September 30, 2024, the Company recorded $ 530,475 of impairment for Goodwill in the Security Segment under quantitative

Company accounts for leases in accordance with Accounting Standards Codification 842, Leases (“ASC 842”).

4 unchanged sentences

asset for the lease term.

For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by

class of underlying asset not to recognize lease assets and lease liabilities.

Company also made the accounting policy decision not to recognize lease assets and liabilities for leases with a term of 12 months or

28 unchanged sentences

The Company applies the CECL model on its related party assets and applies an allowance when necessary.

and Subsidiaries

and Contingencies

19 unchanged sentences

will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.

Company accounts for revenue in accordance with A ccounting Standards Codification 606, Revenue

from Contracts with Customers (“ASC 606”) .

Under the guidance of the standard, revenue represents the amount received

or receivable for goods and services supplied by the Company to its customers.

Company recognizes revenue at the time a good or service

is transferred to a customer and the customer obtains control of that good or receives the service performed.

Most of the Company’s

sales arrangements with customers in the Security segment are short-term in nature involving single performance obligations related to

the delivery of goods or repair of equipment and generally provide for transfer of control at the time of shipment to the customer.

Company generally permits returns of product or repaired equipment due to defects;

Company accounts for revenue in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers (“ASC

Under the guidance of the standard, revenue represents the amount received or receivable for goods and services supplied

by the Company to its customers.

Company recognizes revenue at the time a good or service is transferred to a customer and the customer

obtains control of that good or receives the service performed.

Most of the Company’s sales arrangements with customers in the

Security segment are short-term in nature involving single performance obligations related to the delivery of goods or repair of equipment

and generally provide for transfer of control at the time of shipment to the customer.

The Company generally permits returns of product

or repaired equipment due to defects;

however, returns are historically insignificant.

terms vary by customer and product but generally do not exceed 90 days.

Billing terms vary by customer and product but

generally do not exceed 90 days.

accordance with the authoritative guidance issued by the FASB on revenue recognition, the Company recognizes revenue from cost reimbursable

12 unchanged sentences

invoicing to customers.

records deferred revenue when receiving cash in advance of delivering services to the customer.

Company records deferred revenue when receiving cash in advance of delivering services to the customer.

The deferred revenue is reversed,

and revenue is recognized when those services are delivered.

The amounts were $ 1,955,635 ,

$ 2,311,334 , and $ 1,788,507 as

of September 30, 2024, 2023, and 2022 respectively, recorded as Deferred revenue.

Short-term deferred revenue of $ 1,297,616

is expected to be recognized over the next 12 months.

records a liability when receiving cash in advance of delivering goods to the customer.

The revenue is recognized, and the deposit

is applied to the invoice for those goods when those goods are delivered.

The amounts were $ 1,866,014 , $ 1,955,635 , and $ 2,311,334 as of September

30, 2025, 2024, and 2023 respectively, recorded as Deferred revenue.

Short-term deferred revenue of $ 1,383,036 is expected to be recognized

over the next 12 months.

Company records a liability when receiving cash in advance of delivering goods to the customer.

The revenue is recognized, and the

deposit is applied to the invoice for those goods when those goods are delivered.

The company recorded Deposits from customers of

$ 158,344 , $ 408,415 ,

and $ 57,434 as of September 30, 2025, 2024,

1 unchanged sentence

These amounts are short-term and are expected to be recognized over the next 12 months.

and Subsidiaries

Company’s industrial services segment’s revenue is derived from contracts with customers.

52 unchanged sentences

are incurred.

and Subsidiaries

following table illustrates the approximate disaggregation of the Company’s revenue based off timing of revenue recognition for

1 unchanged sentence

OF DISAGGREGATION OF THE COMPANY REVENUE RECOGNITION

For the years ended

September 30, 2024

September 30, 2023

the year ended

Point-in-time

44 unchanged sentences

statements based on their fair values and over the requisite service period.

and Subsidiaries

fair value for options granted was determined at the date of grant using a Black-Scholes valuation model and the straight-line attribution

19 unchanged sentences

SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT

For the years ended

September 30,

the year ended

the years ended September 30, 2025, and 2024 loss per share basic and diluted for continuing operations are calculated as follows.

1 unchanged sentence

FOR CONTINUING OPERATIONS

For the years ended

For the year ended

September 30,

2 unchanged sentences

$ ( 7,678,629 )

Less (loss)/gain in noncontrolling interest

Less loss in noncontrolling interest

Preferred stock dividends

Net loss applicable to common shareholders

( 7,340,403 )

Net loss applicable to

common shareholders

( 27,920,265 )

Weighted Average Number of Shares-Basic & Diluted

Loss per share - Basic & Diluted - Continuing Operations

( 7,340,403 )

Weighted Average Number of Shares-Basic

Loss per share - Basic & Diluted

- Continuing Operations

accordance with ASC 260-45-13, the common shares underlying the Series A Warrants under the alternative cashless exercise have been included

in the calculation of the weighted average shares.

Company carries its accounts receivables net of an allowance for credit losses.

The measurement and recognition of credit losses involves

the use of judgment.

Management’s assessment of expected credit losses includes consideration of current and expected economic

conditions, market and industry factors affecting the Company’s customers (including their financial condition), the aging of account

balances, historical credit loss experience, customer concentrations, and customer creditworthiness.

Management evaluates its experience

with historical losses and then applies this historical loss ratio to financial assets with similar characteristics.

The Company’s

historical loss ratio or its determination of risk pools may be adjusted for changes in customer, economy, market, or other circumstances.

The Company may also establish an allowance for credit losses for specific receivables when it is probable that the receivable will not

be collected, and the loss can be reasonably estimated.

Amounts are written off against the allowance when they are considered to be

uncollectible, and reversals of previously reserved amounts are recognized if a specifically reserved item is settled for an amount exceeding

the previous estimate.

and Subsidiaries

following table illustrates the current expected credit losses activity for the year ended September 30, 2025.

SCHEDULE OF CURRENT EXPECTED CREDIT LOSSES

Trade receivables,

Contract assets, net

receivable, net -

related party

As of September 30, 2024

As of September 30, 2025

Company will utilize the Probability-of-default method for financing receivables and loans.

Expected credit losses are determined by

multiplying the probability of default (i.e., the probability the asset will default within the given time frame) by the loss given default

(the percentage of the asset not expected to be collected because of default).

The Company considers sources of repayment associated

with a financial asset when determining its credit losses, including collection against the collateral and certain embedded credit enhancements,

such as guarantees or insurance.

Currency Translation (Loss)/Gain and Comprehensive Income Loss

7 unchanged sentences

For the years ending September 30, 2025, and September

30, 2023, comprehensive loss includes a loss of $ 127,409 and a gain of $ 699,181 , respectively, which were entirely from foreign currency

30, 2024, comprehensive loss includes a loss of $ 357,957 and $ 127,409 , respectively, which were entirely from foreign currency translation.

of and for the year ended September 30, 2025, and 2024, the Company used the following exchange rates.

8 unchanged sentences

For the year ended

September 30, 2024

September 30, 2023

Great Britain Pound

Reclassifications

reclassifications have been made to prior period amounts to conform to the current period presentation.

reclassification has been made to prior period amounts to conform to the current period presentation.

This had no effect on the Company’s

statement of operations or retained earnings.

The reclassification was to the caption “Short-term investments” which has

been reclassified to “Prepaid expenses and other current assets” on the Consolidated Balance Sheet and “Gain/(loss)

on marketable securities to “Prepaid expenses and other current assets” on the Consolidated Statements of Cash Flows.

following table illustrates the reclassifications made.

The reclassification was to the caption “Accrued expenses” which a portion

has been reclassified to “Accrued payable on inventory in transit” on the Consolidated Balance Sheet.

The following table

illustrates the reclassifications made.

OF RECLASSIFICATIONS

September 30, 2023

CONSOLIDATED BALANCE SHEETS

As previously reported

Reclassification

Short-term investments

Prepaid expenses and other current assets

For the year ended September 30, 2023

CONSOLIDATED STATEMENTS OF CASH FLOWS

As previously reported

BALANCE SHEETS

previously reported

Reclassification

Gain/(loss) on marketible securities

Prepaid expenses and other current assets

$ ( 458,534 )

$ ( 458,476 )

Payments on bank loans

$ ( 488,689 )

Payments on debt

$ ( 1,044,370 )

$ ( 488,689 )

$ ( 1,533,059 )

of an Immaterial Error in Previously Issued Financial Statements

to the issuance of our financial statements for the year ended September 30, 2023, immaterial errors were identified and has been corrected

in our historical information related to the cash flow presentation of non-cash royalty income.

The original presentation had non-cash

royalty income presented in Trade receivables – related party.

Additionally, Shares issued to pay for services was presented in the supplemental disclosure of the cash flow presentation,

but not presented on the face of the financial.

effects of the correction to the individual effected line items in our Consolidated Statement of Cash Flows are as follows.

SCHEDULE OF ERROR CORRECTIONS AND PRIOR PERIOD ADJUSTMENTS

For the year ended September 30, 2023

As previously reported

Non-cash royalty income

Trade receivables - related party

$ ( 1,143,342 )

$ ( 1,099,070 )

Shares issued to pay for services

Accounts payable

Accrued expenses

$ ( 208,433 )

Company accounts for business combinations under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification

(“ASC”) 805 “Business Combinations” using the acquisition method of accounting, and accordingly, the assets and

liabilities of the acquired business are recorded at their fair values at the date of acquisition.

The excess of the purchase price over

the estimated fair value is recorded as goodwill.

All acquisition costs are expensed as incurred.

Upon acquisition, the accounts and

results of operations are consolidated as of and subsequent to the acquisition date.

Accrued payable on inventory in transit

and Subsidiaries

Concentrations

and cash and credit risks

the year ended September 30, 2025, the Company’s Security segment had a single sale valued at $ 10,375,000 ,

which represents 27 %

of sales for that segment and 14 %

of consolidated revenues.

At times during the years ended September 30, 2025, and 2024, the Company’s cash balances may have exceeded federally insured limits.

Adopted Accounting Pronouncements

June 2016, the FASB issued Accounting Standards Update No.

2016-13, Financial Instruments – Credit Losses (Topic 326):

of Credit Losses on Financial Instruments (“Update 2016-13”).

Update 2016-13 replaced the incurred loss model with an expected

loss model, which is referred to as the current expected credit loss (“CECL”) model.

The CECL model is applicable to the

measurement of credit losses on financial assets measured at amortized cost, including but not limited to trade receivables.

business entities, the new standard became effective for annual reporting periods beginning after December 15, 2022, including interim

periods within that reporting period.

On October 1, 2023, the Company implemented this standard

and there has been no material change to the consolidated financial statements.

following table illustrates the effect of implementation of Update 2016-13 on the current expected credit losses for the following line

items on the consolidated balance sheet.

OF EFFECT IMPLEMENTATION ON CONDENSED CONSOLIDATED BALANCE SHEET

October 1, 2023 As reported under

September 30, 2023 Pre-ASC 326 Adoption

Impact of ASC 326 Adoption

Trade receivables, net

Contract assets, net

Royalties receivable, net - related party

Note receivable, net - related party

The Company carries its accounts

receivables net of an allowance for credit losses.

The measurement and recognition of credit losses involves the use of judgment.

assessment of expected credit losses includes consideration of current and expected economic conditions, market and industry factors

affecting the Company’s customers (including their financial condition), the aging of account balances, historical credit loss

experience, customer concentrations, and customer creditworthiness.

Management evaluates its experience with historical losses and then

applies this historical loss ratio to financial assets with similar characteristics.

The Company’s historical loss ratio or its

determination of risk pools may be adjusted for changes in customer, economy, market or other circumstances.

The Company may also establish

an allowance for credit losses for specific receivables when it is probable that the receivable will not be collected, and the loss can

be reasonably estimated.

Amounts are written off against the allowance when they are considered to be uncollectible, and reversals of

previously reserved amounts are recognized if a specifically reserved item is settled for an amount exceeding the previous estimate.

Company will utilize the Probability-of-default method for financing receivables and loans.

Expected credit losses are determined by

multiplying the probability of default (i.e., the probability the asset will default within the given time frame) by the loss given default

(the percentage of the asset not expected to be collected because of default).

The Company considers sources of repayment associated

with a financial asset when determining its credit losses, including collection against the collateral and certain embedded credit enhancements,

such as guarantees or insurance.

The allowance for credit losses was immaterial as of September 30, 2024.

following table illustrates the current expected credit losses activity for the nine months ended September 30, 2024.

OF EXPECTED CREDIT LOSSES ACTIVITY

October 1, 2023

September 30, 2024

For the year ended

October 1, 2023

September 30, 2024

Trade receivables, net

Trade receivables, net - related party

Trade receivables, net

Contract assets, net

Royalties receivable, net - related party

Note receivable, net - related party

Issued Accounting Pronouncements Not Yet Effective

June 30, 2022, the FASB issued ASU 2022-03 Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject to

Contractual Sale Restrictions (“ASU 2022-03”), which (1) clarifies the guidance in ASC 820 on the fair value measurement

of an equity security that is subject to a contractual sale restriction and (2) requires specific disclosures related to such an equity

Under current guidance, stakeholders have observed diversity in practice related to whether contractual sale restrictions should

be considered in the measurement of the fair value of equity securities that are subject to such restrictions.

On the basis of interpretations

of existing guidance and the current illustrative example in ASC 820-10-55-52 of a restriction on the sale of an equity instrument, some

entities use a discount for contractual sale restrictions when measuring fair value, while others view the application of such a discount

to be inconsistent with the principles of ASC 820.

To reduce the diversity in practice and increase the comparability of reported financial

information, ASU 2022-03 clarifies this guidance and amends the illustrative example.

2022-03 is effective for fiscal years beginning

after December 15, 2023, with early adoption permitted.

The Company is currently evaluating the impact of this ASU on the consolidated

financial statements.

November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures”

(“ASU 2023-07”), which enhances the disclosures required for operating segments in the Company’s annual and interim

consolidated financial statements.

ASU 2023-07 is effective for the Company for annual reporting for fiscal 2025 and for interim period

reporting beginning in fiscal 2026 on a retrospective basis.

December 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-08, Intangibles—Goodwill and Other—Crypto

Assets (Subtopic 350-60):

Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”).

ASU 2023-08 is intended to

improve the accounting for certain crypto assets by requiring an entity to measure those crypto assets at fair value each reporting period

with changes in fair value recognized in net income.

The amendments also improve the information provided to investors about an entity’s

crypto asset holdings by requiring disclosure about significant holdings, contractual sale restrictions, and changes during the reporting

ASU 2023-08 is effective for annual and interim reporting periods beginning after December 15, 2024.

Early adoption is permitted

The Company is currently evaluating the impact

of our pending adoption of ASU 2023-07 on the consolidated financial statements.

for both interim and annual financial statements that have not yet been issued.

The Company adopted this new guidance in July 2025, when

the Company invested in its digital assets.

For the year ended 2025, the company recognized an initial cash purchase of $ 998,462 , recognized

$ 12,522 of staking revenue, less $ 2,755 of non-cash transaction fees, and $ 150,009 of unrealized gain on the fair value of the digital

Issued Accounting Pronouncements Not Yet Effective

December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740):

16 unchanged sentences

on either a prospective basis or retrospective basis.

The Company is currently assessing the potential impacts of adoption on the consolidated

financial statements.

The Company is currently assessing the potential impacts of adoption on the consolidated financial statements.

November 2024, the FASB issued ASU 2024-04, “Debt with Conversion and Other Options (Subtopic 470-20), which clarifies the requirements

4 unchanged sentences

retrospective basis.

The Company is currently in the process of evaluating the impact of adoption on the consolidated financial statements.

The Company is currently in the process of evaluating the impact of adoption on the consolidated

financial statements.

July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326).

This guidance contains amendments that

provide decision-useful information to investors and other financial statement users while reducing the time and effort necessary to

analyze and estimate credit losses for current accounts receivable and current contract assets.

The amendments will be effective for

annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods.

adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available

for issuance.

The Company is currently evaluating the impact of ASU 2025-05 on its condensed consolidated financial statements and related

and Subsidiaries

December 8, 2025, the FASB issued ASU 2025-11 - Interim Reporting (“ASU 2025-11”) which is intended to improve the navigability

of the guidance in ASC 270, Interim Reporting, and clarify when it applies.

Under the amendments, an entity is subject to ASC 270 if

it provides interim financial statements and notes in accordance with GAAP.

ASU 2025-11 also addresses the form and content of such financial

statements, interim disclosures requirements, and establishes a principle under which an entity must disclose events since the end of

the last annual reporting period that have a material impact on the entity.

ASU 2025-11 is effective for interim reporting periods within

annual reporting periods beginning after December 15, 2027, and early adoption is permitted.

The Company is currently evaluating the impact

the adoption of ASU 2025-11 may have on the Company’s consolidated financial statements.

October 2023, the FASB issued ASU 2023-06, Disclosure Improvements:

Codification Amendments in Response to the SEC’s Disclosure

Update and Simplification Initiative, to amend certain disclosure and presentation requirements for a variety of topics within the Accounting

Standards Codification (“ASC”).

These amendments align the requirements in the ASC to the removal of certain disclosure requirements

set out in Regulation S-X and Regulation S-K, announced by the SEC.

The effective date for each amended topic in the ASC is the date

on which the SEC’s removal of the related disclosure requirement from Regulation S-X or Regulation S-K becomes effective.

adoption is prohibited.

The Company does not anticipate that the ASU will have a material effect on its financial statements and related

Company does not believe that any other recently issued but not yet effective accounting pronouncements, if adopted, would have a material

9 unchanged sentences

under ASC 280.

The Company operates as two operating segments and unallocated corporate expenses which is reported in a manner consistent

with the internal reporting provided to the chief operating decision-maker.

The chief operating decision-maker is responsible for the

allocation of resources and assessing the performance of the operating segment and has been identified as Saagar Govil, the CEO of the

corporate expenses mainly relate to payroll and benefits for corporate officers, investor relation expenses, accounting expenses related

audit and taxes, legal expenses related to corporate matters, consulting expenses related to accounting and corporate matters, and interest

expense on notes payable.

Security segment operates under the Vicon brand that deliver cutting-edge software and hardware technologies:

The Company operates as two operating segments and unallocated corporate revenue and expenses which is reported in a manner

consistent with the internal reporting provided to the chief operating decision-maker.

The chief operating decision-maker is responsible

for the allocation of resources and assessing the performance of the operating segment and has been identified as Saagar Govil, the CEO

of the Company.

corporate revenue relates to the realized income on digital assets, corporate expenses mainly relate to payroll and benefits for corporate

officers, investor relation expenses, accounting expenses related audit and taxes, legal expenses related to corporate matters, consulting

expenses related to accounting and corporate matters, and interest expense on notes payable.

Security segment operates under the Vicon brand that delivers innovative software and hardware technologies:

Industries, a majority owned subsidiary, provides end-to-end security solutions to meet the toughest corporate, industrial, and governmental

3 unchanged sentences

hospitals, universities, schools, and federal and state government offices.

Vicon provides cutting edge, mission critical security and

Vicon provides innovative, mission critical security and

video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms.

8 unchanged sentences

turnarounds, maintenance, specialty welding services, and high-quality scaffolding.

and Subsidiaries

following tables summarize the Company’s segment information.

OF SEGMENT INFORMATION

Industrial Services

For the year ended September 30, 2024

the year ended September 30, 2023

Industrial Services

ended September 30, 2025

ended September 30, 2024

External revenues

Cost of revenues

3 unchanged sentences

Research and development

Goodwill Impairment

Operating (loss)/income

$ ( 4,123,443 )

Operating income/(loss)

$ ( 4,757,192 )

2 unchanged sentences

$ ( 5,269,745 )

Other expense, net

$ ( 364,994 )

Other (expense)/income

$ ( 184,807 )

5 unchanged sentences

$ ( 2,206,604 )

September 30,

corporate expenses mainly relate to payroll and benefits for corporate officers, investor relation expenses, accounting expenses related

to audit and taxes, legal expenses related to corporate matters, interest expense on notes payable, and Series A and B Warrants transaction

Identifiable Assets

3 unchanged sentences

SCHEDULE OF REVENUE FROM PRODUCT SALES AND SERVICES FROM ITS SUBSIDIARIES

September 30,

the year ended

September 30, 2025

1 unchanged sentence

United Kingdom

September 30,

Long-lived Assets

United States

United Kingdom

and Subsidiaries

4 – FAIR VALUE MEASUREMENTS

23 unchanged sentences

ability to continue as a going concern.

Company’s fair value assets for the years ended September 30, 2024, are as follows.

SCHEDULE OF FAIR VALUE OF LIABILITIES

Company’s fair value assets and liabilities for the years ended September 30, 2025, and 2024, are as follows.

OF FAIR VALUE OF LIABILITIES

Quoted Prices

1 unchanged sentence

September 30,

Digital assets

Warrant liabilities

September 30, 2023, the Company had no fair value assets or liabilities.

summary of the warrant liabilities activity for the year ended September 30, 2024, is as follows.

SCHEDULE OF THE WARRANT LIABILITIES ACTIVITY

Series A Warrants

Series B Warrants

Prefunded Warrants

Quoted Prices

Identical Assets

September 30,

Warrant liabilities

July 29, 2025, the Company invested $ 998,642 in Solana (SOL) and staked our holdings.

SOL is a fungible crypto asset that meets the criteria

for an intangible asset, resides on a distributed ledger, is secured by cryptography, and does not grant enforceable rights to underlying

goods or services to its holder.

The digital assets were measured at fair value after acquisition, with changes reported in net income.

Staking earnings are recorded as revenue.

Asset staking allows holders of specific cryptocurrencies to earn rewards for helping to validate blocks of transaction data as it is

submitted to the blockchain network.

staking process serves two key purposes:

Ensures the accuracy of new information as it is added to the blockchain.

Helps to secure the underlying blockchain network against the majority of the network taking over control, known as a 51% attack.

staking process uses incentives and penalties governed by computer-based rules to encourage honest participation in the network.

who act within the rules of the protocol receive rewards for their contributions, while those who act dishonestly can face penalties,

such as losing their staked cryptocurrency through a process called slashing.

Staking rewards are distributed as newly minted cryptocurrency

units, oftentimes at a proportionate rate to the amount a person stakes.

With some proof-of-stake blockchains, depositing more assets

in a staking smart contract increases the chance of being selected to validate blocks.

This mechanism is based on the assumption that

those with more “skin in the game” are more likely to act within the best interests of the network because they have more

to lose financially if their assets are slashed (confiscated by the network).

However, to avoid favoring wealthier participants, some

protocols incorporate randomness to ensure everyone, including those with smaller stakes, has a chance to earn rewards.

incentives, in the form of additional SOL, are recognized on the date received at the fair market value on that date.

There are no lockups

or restrictions on the Company’s digital asset holdings due to staking.

and Subsidiaries

Company’s digital assets for the year ended September 30, 2025, is as follows.

OF DIGITAL ASSETS

Balance, September 30, 2025

following table is a summary of our digital assets for the year ended September 30, 2025.

Fair Value, September 30, 2024

Cash purchase

Receipt of SOL from staking

Non-cash transaction fees

Unrealized gain

Fair Value, September 30, 2025

fair value of the Series B Warrants is estimated on the balance sheet date using the Black-Scholes model, which requires inputs based

on certain subjective assumptions, including the fair value of the Company’s common shares, expected share price volatility, the

expected term of the award, the risk-free interest rate for a period that approximates the expected term of the option, and the Company’s

expected dividend yield.

September 30, 2025, and 2024, the following inputs were used in the Black-Scholes model.

OF FAIR VALUE INPUTS USED IN BLACK-SCHOLES MODEL

September 30, 2025

September 30, 2024

Expected term

Risk-free interest rate

Expected volatility

Expected dividend yield

summary of the warrant liabilities activity for the years ended September 30, 2025, and 2024, is as follows.

SCHEDULE OF WARRANT LIABILITIES ACTIVITY

Warrant Liabilities at September 30, 2023

9 unchanged sentences

Warrant Liabilities at September 30, 2024

Warrants Issued

Warrants Exercised

( 5,669,909 )

( 1,727,742 )

( 7,397,651 )

Fair market revaluation

Warrant Liabilities at September 30, 2025

5 – RESTRICTED CASH

5 unchanged sentences

30, 2025, and 2024, respectively.

Additionally, there was $ 100,000 of restricted cash in escrow per the purchase agreement with Heisey

Mechanical, Ltd, an additional $ 325,340 in escrow related to bond requirements on certain public projects, and $ 66,935 in deposit guarantees.

Additionally, at September 30, 2025, there was $ 100,000 of restricted cash in escrow per the purchase

agreement with Heisey Mechanical, Ltd, an additional $ 366,319 in escrow related to bond requirements on certain public projects, and

$ 67,204 in deposit guarantees.

At September 30, 2024, there were additional amounts of $ 100,000 of restricted cash in escrow per the

purchase agreement with Heisey Mechanical, Ltd, an additional $ 325,340 in escrow related to bond requirements on certain public projects,

and $ 66,935 in deposit guarantees.

6 – TRADE RECEIVABLES, NET

1 unchanged sentence

SCHEDULE OF TRADE RECEIVABLES, NET

September 30,

Trade receivables

Allowance for credit losses

Accounts receivables,

receivables, net, total

receivables, net were $ 9,209,695 at September 30, 2023.

1 unchanged sentence

for credit losses include estimated losses resulting from the application of the CECL method to our trade receivables.

and Subsidiaries

7 – PREPAID AND OTHER CURRENT ASSETS

1 unchanged sentence

SUMMARY OF PREPAID EXPENSES AND OTHER CURRENT ASSETS

September 30, 2024

September 30, 2023

Prepaid expenses

4 unchanged sentences

VAT and GST tax receivable

Prepaid expenses and other current assets total

expenses and other current assets total

8 – INVENTORY, NET

net of reserves, consist of the following.

net of reserves, consists of the following.

SCHEDULE OF INVENTORY, NET

September 30,

Raw materials

5 unchanged sentences

SUMMARY OF PROPERTY AND EQUIPMENT

September 30,

Building and leasehold improvements

6 unchanged sentences

( 11,712,280 )

Property and equipment, net

Company completed the annual impairment test of property and equipment and determined that there was no impairment

as the fair value of property and equipment substantially exceeded their carrying values at September 30, 2024.

Depreciation and

amortization of property and equipment totaled approximately $ 1,328,741 and

$ 1,026,075 for

fiscal years ended September 30, 2024, and 2023, respectively and are recorded as general and administrative expenses on the

Company’s Consolidated Statements of Operations.

Additionally, depreciation and amortization of property and equipment

of approximately $ 53,895 and $ 33,256 for fiscal years ended September 30, 2024, and 2023, respectively and are recorded as cost of

revenues, Security on the Company’s Consolidated Statements of Operations.

Property and equipment,

Company completed the annual impairment test of property and equipment and determined that there was no impairment as the fair value

of property and equipment substantially exceeded their carrying values at September 30, 2025.

Depreciation and amortization of property

and equipment totaled approximately $ 1,355,538 and $ 1,328,741 for fiscal years ended September 30, 2025, and 2024, respectively and are

recorded as general and administrative expenses on the Company’s Consolidated Statements of Operations.

Additionally, depreciation

and amortization of property and equipment of approximately $ 118,463 and $ 53,895 for fiscal years ended September 30, 2025, and 2024,

respectively and are recorded as cost of revenues, Security on the Company’s Consolidated Statements of Operations.

and Subsidiaries

10 – GOODWILL

1 unchanged sentence

SCHEDULE OF GOODWILL BY SEGMENT

Industrial Services

September 30, 2023

Acquisition measurement period adjustment

Balance at September

Purchase price allocation adjustment

Impairment /adjustments

Balance at September

the year ended September 30, 2024, $ 530,475 of impairment of the Company’s goodwill was recorded.

of September 30, 2024, and September 30, 2023, accumulated impairment losses of $ 3,846,475 and $ 3,316,000 related to the Security segment

have been recorded.

of September 30, 2025, and September 30, 2024, accumulated impairment losses of $ 3,846,475 related to the Security segment have been

11 - OTHER ASSETS

12 unchanged sentences

SCHEDULE OF OTHER ASSETS

September 30, 2024

September 30, 2023

Rental deposits

1 unchanged sentence

Other deposits

Demonstration equipment supplied to resellers

Other assets total

Demonstration equipment

supplied to resellers

12 – ACCRUED EXPENSES

1 unchanged sentence

SCHEDULE OF ACCRUED EXPENSES

September 30, 2024

September 30, 2023

Accrued expenses

Accrued payable on inventory in transit

Accrued payroll

Accrued payroll and payroll taxes

Accrued warranty

Accrued expenses total

expenses total

and Subsidiaries

13 – DEFERRED REVENUE

1 unchanged sentence

SCHEDULE OF DEFERRED REVENUE

For the year ended

September 30, 2024

September 30, 2023

Deferred revenue at beginning of period

the year ended

Deferred revenue at beginning of

Net additions:

1 unchanged sentence

Recognized as revenue:

Deferred software revenues

software revenues

( 2,160,149 )

( 2,677,329 )

Deferred revenue at end of period

Deferred revenue at end

current portion

Long-term deferred revenue at end of period

Long-term deferred revenue

at end of period

the years ended September 30, 2025, and 2024, the Company recognized revenue of $ 1,335,394 , and $ 1,555,423 , respectively, that was previously

15 unchanged sentences

OF CONTRACT ASSETS AND LIABILITIES

September 30, 2024

September 30, 2023

Costs incurred on uncompleted contracts

Estimated gross profit

Applicable billings to date

Applicable billings to

( 15,045,345 )

( 16,000,023 )

Net (billings in excess of costs)/earnings in excess of billings, Ending balance

billing in excess of costs

$ ( 674,891 )

$ ( 268,997 )

and Subsidiaries

the years ended September 30, 2025, and 2024, the Company recognized revenue of $ 1,148,038 and $ 905,319 , respectively, that was previously

1 unchanged sentence

OF CONTRACT ASSETS AND CONTACT LIABILITIES

September 30, 2024

September 30, 2023

For the year ended

September 30, 2024

September 30, 2023

Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts

Contract asset, beginning balance

Changes in revenue billed, contract price or cost estimates

Contract asset, net, ending balance

Estimated Earnings in Excess of Billings on Uncompleted Contracts

Contract asset,

beginning balance

in revenue billed, contract price or cost estimates

asset, net, ending balance

in Excess of Costs and Estimated Earnings on Uncompleted Contracts

Contract liability, beginning

( 1,254,204 )

$ ( 980,319 )

in revenue billed, contract price or cost estimates

liability, ending balance

$ ( 1,655,055 )

$ ( 1,254,204 )

Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts

Contract liability, beginning balance

Net billings in excess

of costs, beginning balance

$ ( 268,997 )

Changes in revenue billed, contract price or cost estimates

Contract liability, ending balance

in revenue billed, contract price or cost estimates

$ ( 405,894 )

( 1,027,879 )

Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts

Net billings in excess of costs, beginning balance

Changes in revenue billed, contract price or cost estimates

billings in excess of costs, ending balance

$ ( 674,891 )

Net billings in excess of costs, ending balance

$ ( 268,997 )

5 unchanged sentences

The weighted average discount rate used to measure

lease liabilities was approximately 6.54 % at September 30, 2024, and 2023.

The Company used the rate implicit in the lease, where known,

or its incremental borrowing rate as the rate used to discount the future lease payments.

Company’s corporate segment leases approximately 100 square feet of office space in Brooklyn, NY on a month-to-month lease at a

rent of $ 600 per month with $ 7,200 of expense for the year ended September 30, 2024 and approximately 911 square feet of office space

in Clovis, CA on a month-to-month lease at a monthly rent of $ 4,202 with $ 58,996 of expense for the year ended September 30, 2024.

expense is under the caption “General and administrative” on the Company’s Consolidated Statements of Operations.

lease liabilities was approximately 6.23 % at September 30, 2025, and 6.54 % at September 30, 2024.

The Company used the rate implicit

in the lease, where known, or its incremental borrowing rate as the rate used to discount the future lease payments.

Company’s corporate segment leased approximately 100 square feet of office space in Brooklyn, NY on a month-to-month lease, which

the Company ended in June 2025, at a rent of $ 600 per month with $ 5,400 of expense for the year ended September 30, 2025 and approximately

350 square feet of office space in Clovis, CA on a month-to-month lease at a monthly rent of $ 1,933 with $ 33,797 of expense for the year

ended September 30, 2025.

The expense is under the caption “General and administrative” on the Company’s Consolidated

Statements of Operations.

reconciliation of undiscounted cash flows to operating lease liabilities recognized in the Consolidated Balance Sheet at September 30,

2 unchanged sentences

Years ending September 30,

Operating Leases

Undiscounted lease payments

Amount representing interest

Discounted lease payments

Less short-term operating lease liabilities

Long-term operating lease liabilities

representing interest

lease payments

short-term operating lease liabilities

operating lease liabilities

costs for the years ended September 30, 2025, and 2024 are set forth below.

OF LEASE COSTS

For the year ended

September 30,

Operating lease costs

Short-term lease costs

Total lease cost

Operating lease

and Subsidiaries

16 – LINES OF CREDIT AND LONG-TERM LIABILITIES

14 unchanged sentences

loan origination fees.

There were $ 1,874,989 in available funds as of September 30, 2024.

There were $ 1,564,179 of available funds as of September 30, 2025.

August 31, 2023, the Company and Streeterville Capital, LLC (“Streeterville”) entered into a standstill agreement for the

11 unchanged sentences

To date, the Company has paid Streeterville $ 4,588,897 under this agreement.

May 29, 2025, the Company entered into a Standstill Agreement with Streeterville in which Streeterville agreed not to seek to redeem

any portion of its two outstanding notes with the Company for a period of 60 days which expired on July 29, 2025 and in exchange, the

Company agreed to pay to Streeterville the greater of $ 550,000 or fifty percent ( 50 %) of the net proceeds the Company receives from the

sale of any of its common stock or preferred stock during the Standstill Period.

During the standstill period, the Company paid Streeterville

$ 636,250 under this agreement.

Payable to Bank

5 unchanged sentences

This loan is secured by the assets of the Company.

December 5, 2023, the Company acquired a loan from HDFC Bank in the amount of ₹ 2,352,700 ($ 28,219 on date of loan acquisition)

in order to fund a vehicle for Cemtrex Technologies Pvt, Ltd., Inc.

This loan carries interest of 8.7 % per annum.

This loan was paid

in full prior to the maturity date on June 3, 2024.

OF LINES OF CREDIT AND LONG TERM LIABILITIES

September 30,

November 21, 2024, the Company issued a note payable to Streeterville Capital, LLC in the amount of $ 580,000 .

This note carries interest

of 8 % and matures on May 21, 2026 .

After deduction of an original issue discount of $ 75,000 and legal fees of $ 5,000 , the Company received

$ 500,000 in cash.

As of September 30, 2025, this note had unamortized original issue discount balance of $ 33,333 .

and Subsidiaries

OF LINES OF CREDIT AND AND LONG TERM LIABILITIES

Interest Rate

Fulton Bank - $360,000 fund equipment for AIS.

The Company was in compliance with loan covenants as of September 30, 2024.

This loan is secured by certain assets of the Company.

SOFR plus 2.37% (7.33% as of September 30, 2024 and 7.68% as of September 30, 2023).

Fulton Bank - $ 360,000 fund equipment for AIS.

September 30, 2024

Fulton Bank - $ 360,000 fund equipment

The Company was in compliance with loan covenants as of September 30, 2024.

This loan is secured by certain assets of the Company.

SOFR plus 2.37 % ( 7.33 % as of September 30, 2024 and 7.68 % as of September 30, 2023).

This loan is secured by certain assets of the

SOFR plus 2.37 % ( 6.61 % as of September 30, 2025, and

7.33 % as of September 30, 2024).

Fulton Bank - $ 312,000 fund equipment for AIS.

3 unchanged sentences

Fulton Bank mortgage $ 2,476,000 .

The Company was in compliance with loan covenants as of September 30, 2024.

was in compliance with loan covenants as of September 30, 2025.

This loan is secured by the underlying asset.

SOFR plus 2.62 % ( 7.58 % on September 30, 2024 and ( 7.93 % on September 30, 2023).

Fulton Bank (HEISEY) - $ 1,200,000 mortgage loan;

SOFR plus 2.62 % ( 6.86 % on September 30, 2025,

and 7.58 % on September 30, 2024).

Fulton Bank (HEISEY) - $ 1,200,000 mortgage

requires monthly principal and interest payments through August 1, 2043, with a final payment of remaining principal on September

The loan is collateralized by 615 Florence Street and 740 Barber Street and guaranteed by AIS and Cemtrex.

SOFR plus 2.80 % per annum ( 7.76 % as of September 30, 2024 and 8.11 % as of September 30, 2023).

SOFR plus 2.80 % per annum ( 7.04 % as of September 30, 2025, and 7.76 %

as of September 30, 2024).

Fulton Bank (HEISEY) - $ 2,160,000 .

promissory note related to purchase of Heisey;

note related to purchase of Heisey;

requires 84 monthly principal and interest payments ;

The note is collateralized by the Heisey assets and guaranteed by the Parent;

The note is collateralized by the Heisey

assets and guaranteed by the Parent;

matures in 2030.

SOFR plus 2.80 % per annum ( 7.76 % as of September 30, 2024 and 8.11 % as of September 30, 2023).

Note payable - $ 5,755,000 - Less original issue discount $ 750,000 and legal fees $ 5,000 , net cash received $ 5,000,000 Unamortized original issue discount balance of $ 0 , as of September 30, 2024 and September 30, 2023.

SOFR plus 2.80 % per annum ( 7.04 % as of September 30, 2025, and 7.76 %

as of September 30, 2024).

Note payable - $ 5,755,000 - Less original issue

discount $ 750,000 and legal fees $ 5,000 , net cash received $ 5,000,000 Unamortized original issue discount balance of $ 0 , as of September

30, 2025, and September 30, 2024.

Note payable - $ 9,205,000 .

Less original issue discount $ 1,200,000 and legal fees $ 5,000 ,net cash received $ 8,000,000 .

28,572 shares of common stock valued at $ 700,400 recognized as additional original issue discount.

Unamortized original issue discount balance of $ 0 as of September 30, 2024 and September 30, 2023.

Note Payable - $ 240,000 For the purchase of Heisey Mechanical, Ltd.

Term Loan Agreement with NIL Funding Corporation (“NIL”) - $ 5,600,000 The Company was in compliance with loan covenants as of September 30, 2023.

Paycheck Protection Program loan - $ 121,400 - The issuing bank determined that this loan qualifies for loan forgiveness;

however the Company is awaiting final approval from the Small Business Administration.

Software License Agreement - $ 1,125,000 , for the purchase of software source code for use in our Security segment products

Less original issue discount $ 1,200,000

and legal fees $ 5,000 ,

net cash received $ 8,000,000 .

shares of common stock valued at $ 700,400

recognized as additional original issue discount.

Unamortized original issue discount balance of $ 0

as of September 30, 2025, and September 30, 2024.

Note payable - $ 580,000 .

Less original issue discount $ 75,000

and legal fees $ 5,000 ,

net cash received $ 500,000 .

Unamortized original issue discount balance of $ 33,333

as of September 30, 2025.

Paycheck Protection Program loan - $ 121,400

- The issuing bank determined that this loan qualifies for loan forgiveness;

however, the Company is awaiting final approval from

the Small Business Administration.

Unamortized original

issue discount

Current maturities

1 unchanged sentence

( 4,732,377 )

Long-term debt

maturities of the Company’s long-term debt over the next 5 years are as follows.

and Subsidiaries

maturities for the Company’s long-term debt over the next 5 years are as follows.

OF ESTIMATED MATURITIES OF LONG TERM DEBT

Fulton Bank - $ 312,000

Fulton Bank - $ 360,000

Fulton Bank - $ 312,000

Fulton Bank - $ 2.16 Mil

3 unchanged sentences

17 – RELATED PARTY TRANSACTIONS

of September 30, 2024, and September 30, 2023, there was $ 0

and $ 3,806 ,

respectively, payable due to Ducon Technologies, Inc., which is controlled by Aron Govil, the Company’s Founder and Former Director

As of September 30, 2023, there were $ 637,208

of receivables due from Ducon Technologies, Inc.

The Company negotiated a payment agreement regarding past receivables and other liabilities due to Cemtrex, Inc.

of September 30, 2023, there were $ 637,208 of receivables due from Ducon Technologies, Inc ., which is controlled by Aron Govil, the

Company’s Founder and Former Director and CFO.

The Company has negotiated a payment agreement regarding past receivables and other

liabilities due to Cemtrex, Inc.

totaling $ 761,585 .

This agreement was in the form of a secured promissory note earning interest at a rate of 5 %

per annum and matured on July

The Company did not receive payment

on this note at the maturity date and placed a full allowance on the note during fiscal year 2024 and appears on the Company’s

Consolidated Statements of Operations and Comprehensive Loss under general and administrative expenses.

February 26, 2021, the Company entered into a Settlement Agreement and Release with Aron Govil regarding a dispute over an alleged misappropriation

part of the Settlement Agreement, Mr.

Govil was required to pay the Company consideration with a total value of $ 7,100,000 (the “Settlement

Amount”) by entering into the Agreement.

The Settlement Amount was satisfied in a combination of Mr.

Govil forfeiting certain Preferred

Stock and outstanding options and executing a secured note in the amount of $ 1,533,280 .

The Independent Board of Directors in coordination

with Management concluded the settlement represented fair value.

Govil also executed a secured promissory note (the “Note”) in the amount of $ 1,533,280 .

The Note matured and was due in full

in two years and boar interest at 9 % per annum and was secured by all of Mr.

Govil’s assets.

Govil also agreed to sign an affidavit

confessing judgment in the event of a default on the Note.

In accordance with ASC 450-30, Gain Contingencies, the Company determined

the gain will not be recognized until the note is paid.

Accordingly, the note and associated gain is not presented on the Company’s

consolidated balance sheets and consolidated statements of operations and comprehensive loss.

The Company has not received payment on

this note to date.

This agreement is in the form of a secured promissory note earning interest at a

rate of 5 % per annum and matured on July 31, 2024 .

The Company did not receive payment on this note at the maturity date and placed a

full allowance on the note during fiscal year 2024 and appears on the Company’s Consolidated Statements of Operations and Comprehensive

Loss under general and administrative expenses.

and Subsidiaries

November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”)

2 unchanged sentences

(formerly Cemtrex Labs), to Mr.

The successor Company conducts business under the name CXR, Inc.

November 22, 2022, the Company completed the above disposition for the following consideration.

comprised of:

in cash payable at Closing;

royalty of all revenues on the Business to be paid 90 days after the end of each calendar

year for the next three years;

and should the total sum of royalties due be less than $ 820,000

at the end of the three-year period, Purchaser shall be obligated to pay the difference between

$ 820,000 and the royalties paid.

Advanced Technologies, Inc.

in cash payable at Closing;

royalty of all revenues on the Business to be paid 90 days after the end of each calendar

year for the next 5 years ;

in SAFE (common equity) at any subsequent fundraising or exit above $5,000,000 with a $10,000,000

Company’s Board of Directors, excluding Saagar Govil who abstained from all voting on these agreements, approved these actions

and agreements.

to the on-going losses and risk associated with the SmartDesk business the Company has valued the royalty and SAFE agreement associated

with the SmartDesk sale at $ 0 and considers such consideration to be a gain contingency.

All receivables due from SmartDesk, Inc, have

a full allowance placed on them, no payments have been received.

on sales projections for Cemtrex XR, Inc., the Company does not believe that it will exceed the sales levels required to exceed the $ 820,000

royalties due and has not accounted for any additional royalties at this time.

In accordance with ASC 310 – Receivables, the

Company has discounted the royalties due to $ 660,621 and during the years ended September 30, 2024, and 2023 the Company recognized $ 53,126

and $ 44,272 of royalties due, respectively, and will amortize the remaining amount over the period the royalties are due.

January 6, 2025, the Company and Saagar Govil signed an agreement to revise the purchase price structure and payment terms.

Agreement’s Purchase Price provisions were amended to reflect that the Purchase Price will solely consist of the royalties based

on the actual revenues generated in the three years following closing.

The provision requiring the total sum of royalties to reach a

minimum of $ 820,000 , with any shortfall to be paid by Purchaser, was removed from the Agreement.

Additionally,

the Company received $ 76,000 in royalty payments.

of September 30, 2024, there was $ 685,788 in

trade receivables due from CXR, Inc.

it was agreed that the payment terms due under the royalties shall be as follows commencing on January 1, 2025:

Year (January 2025) Monthly Payment:

Year (January 2026) Monthly Payment:

Payment at the end of the Second Year (December 31, 2026):

Total outstanding royalties

transaction was approved by the Board of Directors with Saagar Govil abstaining from the vote.

on the new payment terms, management determined that it was appropriate to remove the previously recognized royalty receivable of $ 280,545

from the financial statements as of December 31, 2024.

of September 30, 2025, there were royalties receivable from the sale of Cemtrex, XR, Inc.

of $ 460,475 , of which $ 104,229 is considered

short-term and is presented on the Company’s Consolidated Balance Sheet under the caption “Trade receivables,

net – related party.

The Company has taken a $ 165,771 allowance for expected credit losses against these royalties.

of September 30, 2025, there was $ 405,493 in trade receivables due from the Cemtrex XR successor company, CXR, Inc.

Of these receivables

related to costs paid by Cemtrex related to payroll during the transition of employees to the new company and some subscription services

that are set up on auto pay with a credit card.

related to the current amount of royalties due and the remaining $ 409,752

related to services provided by Cemtrex Technologies Pvt.

$ 104,229 is the short term due on the royalties on CXR Inc.’s revenues.

The remaining $ 301,264 is related to the services provided

by Cemtrex Technologies Pvt.

in the normal course of business.

These balances are presented on the

Consolidated Balance Sheets under the caption “Trade receivables - related party”.

The long-term balance of royalties of

presented on the Company’s Consolidated Balance Sheets under the caption “Note receivable, net - related party”.

Fiscal year 2024, the Company recognized $ 665,520

revenue from CXR, Inc.

During the year, the Company recorded $ 60,628 in current expected

credit losses on receivables due from CXR Inc.

May 5, 2025, Saagar Govil, CEO, made a short-term loan to the Company of $ 200,000 for certain operating needs.

This loan was repaid on

August 1, 2025.

18 – STOCKHOLDERS’ EQUITY

2 unchanged sentences

there were 2,755,327 and 2,506,827 shares issued and 2,691,227 and 2,442,727 shares outstanding, respectively.

and Subsidiaries

A Preferred Stock

22 unchanged sentences

1 Preferred Stock

of the Series 1 Preferred will be entitled to receive cumulative cash dividends at the rate of 10 % of the purchase price per year, payable

semiannually on the last day of March and September in each year.

Dividends may also be paid, at our option, in additional shares of

Series 1 Preferred, valued at their liquidation preference.

The Series 1 Preferred rank senior to the common stock with respect to dividends.

Dividends will be entitled to be paid prior to any dividend to the holders of our common stock.

of the Series 1 Preferred will be entitled to receive cumulative cash dividends at the rate of 10 %

of the purchase price per year, payable semiannually on the last day of March and September in each year.

Dividends may also be

paid, at our option, in additional shares of Series 1 Preferred, valued at their liquidation preference.

The Series 1 Preferred rank

senior to the common stock with respect to dividends.

Dividends will be entitled to be paid to preferred shareholders prior to any

dividend to the holders of our common stock.

Series 1 Preferred has a liquidation preference of $ 10 per share, equal to its purchase price.

14 unchanged sentences

Series 1 Preferred will not be convertible into or exchangeable for shares of our common stock or any other security.

and Subsidiaries

Series 1 Preferred will rank with respect to distribution rights upon our liquidation, winding-up or dissolution and dividend rights,

42 unchanged sentences

various means, including through privately negotiated transactions and through an open market program.

the year ended September 30, 2025, the Company cancelled 3,778 shares of Series 1 Preferred Stock, which had been issued for dividends

in error on some the above-mentioned shares.

and Subsidiaries

Board also authorized the Company to enter into written trading plans under Rule 10b5-1 of the Exchange Act.

10 unchanged sentences

and alternative investment opportunities.

October 2, 2024, and November 26, 2024, the Company completed a 60:1 and 35:1 , respectively, reverse stock split on its common

October 2, 2024, November 26, 2024, and September 29, 2025, the Company completed a 60:1 , 35:1 , and 15:1 respectively, reverse stock

split on its common stock.

All share and per share data have been retroactively adjusted for the reverse splits.

August 2, 2024, the Company increased the number of authorized shares of common stock from 50,000,000 to 70,000,000 shares, $ 0.001 par

As of September 30, 2024, there were 14,176 shares issued and outstanding and at September 30, 2023, there were 498 shares

issued and outstanding.

As of September 30, 2025, there were 830,606 shares issued and outstanding and at September 30, 2024, there were 946 shares issued

and outstanding.

2024 Equity Financing

26 unchanged sentences

liabilities and recorded at their fair value.

and Subsidiaries

2024 Warrants

7 unchanged sentences

to receive three times the normal number of shares issued in a cash exercise.

The Series A Holder may only execute the alternative

cashless exercise after Stockholder Approval (and received June 17, 2024);

The Series A Holder may only execute the alternative cashless

exercise after Stockholder Approval (and received June 17, 2024);

at the time of issuance, Stockholder Approval was deemed perfunctory

and almost certain to occur, and the most likely settlement option would be through the alternative cashless exercise.

In addition, beginning on the date of the Warrant Stockholder Approval, the Warrants will contain a reset of the

exercise price to a price equal to the lesser of (i) the then-current exercise price and (ii) lowest volume weighted average price for

the five trading days immediately preceding and immediately following the date we effect a reverse stock split in the future with a proportionate

adjustment to the number of shares underlying the Warrants.

As such, upon

issuance, the total fair value of the Series A Warrants was $ 11,242,940 , which was based on 40,588,230 units issued under the alternative

cashless exercise.

The measurement of fair value of the Series B Warrants were determined utilizing a Black-Scholes model considering

all relevant assumptions current at the date of issuance (i.e., share price of $ 0.277 , exercise price of $ 0.85 , term of five years , volatility

of 132 %, risk-free rate of 4.5 %, and expected dividend rate of 0 %).

The grant date fair value of these Series B Warrants was estimated

to be $ 2,942,711 on May 3, 2024, and such warrants

were classified as liabilities.

Due to the nominal exercise price, the fair value of the Prefunded Warrants was based on the intrinsic

value of each Warrant on the grant date.

The intrinsic value was calculated based on the May 3, 2024, stock price of $ 0.277 and the strike

price of $ 0.001 , resulting in a total fair value of $ 3,105,170 .

In addition, beginning

on the date of the Warrant Stockholder Approval, the Warrants will contain a reset of the exercise price to a price equal to the lesser

of (i) the then-current exercise price and (ii) lowest volume weighted average price for the five trading days immediately preceding

and immediately following the date we effect a reverse stock split in the future with a proportionate adjustment to the number of shares

underlying the Warrants.

As such, upon issuance, the total fair value of the Series A Warrants was $ 11,242,940 , which was based on 40,588,230

units issued under the alternative cashless exercise.

The measurement of fair value of the Series B Warrants were determined utilizing

a Black-Scholes model considering all relevant assumptions current at the date of issuance (i.e., share price of $ 0.277 , exercise price

of $ 0.85 , term of five years , volatility of 132 %, risk-free rate of 4.5 %, and expected dividend rate of 0 %).

The grant date fair value

of these Series B Warrants was estimated to be $ 2,942,711 on May 3, 2024, and such warrants were classified as liabilities.

nominal exercise price, the fair value of the Prefunded Warrants was based on the intrinsic value of each Warrant on the grant date.

The intrinsic value was calculated based on the May 3, 2024, stock price of $ 0.277 and the strike price of $ 0.001 , resulting in a total

fair value of $ 3,105,170 .

The total fair value of the Warrants upon issuance was $ 17,290,821 .

that the gross proceeds received of $ 10,035,292 was less than the total fair value of the liability classified Warrants, the Company

recorded a loss on excess fair value of $ 7,255,528 at issuance.

the year ended September 30, 2024, the Company issued 5,603

shares of common stock to satisfy the Prefunded Warrants described above and 2,100

shares of common stock to satisfy 1,469,531 Series

SCHEDULE SHARES ISSUABLE UNDER WARRANTS OUTSTANDING

Warrant Shares

Weighted Average

Exercise Price

Weighted Average

Contractual Term

Given that the gross proceeds received

of $ 10,035,292 was less than the total fair value of the liability classified Warrants, the Company recorded a loss on excess fair value

of $ 7,255,528 at issuance.

the year ended September 30, 2025, the Company issued 88,492 shares of common stock to satisfy 26,062,071 Series A Warrants and 200,551

shares of common stock to satisfy 3,008,233 Series B Warrants.

the year ended September 30, 2024, the Company issued 5,603 shares of common stock to satisfy the Prefunded Warrants described above

and 2,100 shares of common stock to satisfy 1,469,531 Series A Warrants.

following table summarizes information about shares issuable under warrants outstanding as of September 30, 2025.

SHARES ISSUABLE UNDER WARRANTS OUTSTANDING

Shares Outstanding

Average Exercise Price

Average Remaining Contractual Term (in years)

Outstanding at September 30, 2023

5 unchanged sentences

Outstanding at September 30, 2024

Exercisable at September 30, 2024

Warrants granted

Warrants exercised

( 29,070,304 )

Warrants forfeited

Warrants cancelled

Exercise price adjustments

( 18,971,637 )

Outstanding at September 30, 2025

October 2, 2024, the Company completed a 60 for 1 reverse stock split.

At the time, the Company had 12,059,879 Series A Warrants and

13,529,410 Series B Warrants outstanding at an exercise price of $ 0.85 .

According to the terms of the Series A and Series B warrants,

in the event of a reverse stock split, the exercise price resets to the lowest VWAP during the period commencing five (5) consecutive

trading days immediately preceding and the five (5) consecutive trading days commencing on the reverse stock split effective date and

the number of warrants are adjusted as to keep the aggregate value of the warrants then outstanding remains unchanged.

On October 7,

2024, it was determined that the exercise price has reset to $ 0.7488 .

and Subsidiaries

following table illustrates the adjustment.

OF WARRANTS ADJUSTMENT

number of warrants outstanding

Series A Warrants

Series B Warrants

November 26, 2024, the Company completed a 35 for 1 reverse stock split.

At the time, the Company had 1,201,932 Series A Warrants and

15,444,550 Series B Warrants outstanding at an exercise price of $ 0.7488 .

According to the terms of the Series A and Series B warrants,

in the event of a reverse stock split, the exercise price resets to the lowest VWAP during the period commencing five (5) consecutive

trading days immediately preceding and the five (5) consecutive trading days commencing on the reverse stock split effective date and

the number of warrants are adjusted as to keep the aggregate value of the warrants then outstanding remains unchanged.

On December 2,

2024, it was determined that the exercise price has reset to $ 3.1488 .

following table illustrates the adjustment.

number of warrants outstanding

Series A Warrants

Series B Warrants

May 29, 2025, the Company completed an underwritten public offering of common stock.

At the time, the Company had 248,166 Series A Warrants

and 3,318,556 Series B Warrants outstanding at an exercise price of $ 3.1488 .

According to the terms of the Series A and Series B warrants,

in the event of a public offering, the exercise price resets to the lower of (i) the public offering price, or (ii) the lowest VWAP during

the period commencing five (5) consecutive trading days commencing on the republic offering effective date and the number of warrants

are adjusted as to keep the aggregate value of the warrants then outstanding remains unchanged.

On June 2, 2025, it was determined that

the exercise price has reset to $ 0.893 .

following table illustrates the adjustment.

number of warrants outstanding

Series A Warrants

Series B Warrants

September 29, 2025, the Company completed a 15 for 1 reverse stock split.

At the time, the Company had 248,166 Series A Warrants and

3,318,556 Series B Warrants outstanding at an exercise price of $ 0.893 .

According to the terms of the Series A and Series B warrants,

in the event of a reverse stock split, the exercise price resets to the lowest VWAP during the period commencing five (5) consecutive

trading days immediately preceding and the five (5) consecutive trading days commencing on the reverse stock split effective date and

the number of warrants are adjusted as to keep the aggregate value of the warrants then outstanding remains unchanged.

On October 3,

2025, it was determined that the exercise price has reset to $ 5.304 .

following table illustrates the adjustment.

number of warrants outstanding

Series A Warrants

Series B Warrants

and Subsidiaries

19 – SHARE-BASED COMPENSATION

September 25, 2019, the Company cancelled all outstanding options granted to Saagar Govil, the Company’s Chairman and CEO and granted

a stock option for 6 shares.

These options have an exercise price of $ 117,281.88 per share, which vested upon grant, and they expire

after seven years.

a stock option for 1 share.

This option has an exercise price of $ 1,759,228 per share, which vested upon grant, and they expire after

Additionally, Mr.

Govil was granted additional future options;

2 shares of the Corporation’s common stock, CETX at an exercise price of $ 140,042.00 per share vesting on September 25,

2 shares of the Corporation’s common stock, CETX at an exercise price of $ 168,050.40 per share vesting on September 25, 2023;

2 shares of the Corporation’s common stock, CETX at an exercise price of $ 201,660.48 per share vesting on September 25,

1 share of the Corporation’s

common stock, CETX, at an exercise price of $ 2,100,630 per share vesting

on September 25, 2021;

1 share of the Corporation’s

common stock, CETX, at an exercise price of $ 2,520,756 per share vesting

on September 25, 2023;

1 share of the Corporation’s

common stock, CETX, at an exercise price of $ 3,024,907 per share vesting on September 25, 2025.

the years ended September 30, 2025, and 2024 the Company recognized $ 14,236 and $ 30,325 of share-based compensation expense on its outstanding

2 unchanged sentences

the Company’s Consolidated Statements of Operations.

of September 30, 2024, there was $ 33,071 of total unrecognized compensation cost related to non-vested stock options, which is expected

to be recognized over a weighted-average period of 1.5 years.

of September 30, 2025, there was $ 0 of total unrecognized compensation cost related to non-vested stock options.

SCHEDULE OF STOCK OPTIONS ACTIVITY

Exercise Price

Term (in years)

Average Exercise Price

Average Remaining Contractual Term (in years)

Intrinsic Value

Outstanding at September 30, 2023

4 unchanged sentences

Outstanding at September 30, 2024

Vested and exercisable at September 30, 2024

Options granted

12 unchanged sentences

21 – INCOME TAXES

Tax Cuts and Jobs Act (the “Tax Act”) was enacted on December 22, 2017.

The Tax Act reduces the maximum U.S.

federal corporate

tax rate from 35% to 21% , allows net operating losses incurred in 2018 and beyond to be carried forward indefinitely, allows alternative

minimum tax carryforwards to be partially refunded, beginning in 2018, and fully refunded by 2021, and creates new taxes on certain foreign

sourced earnings.

result of changes made by the Tax Cuts and Jobs Act of 2017, that became effective as of January 1, 2022, the company is now required

to capitalize for tax purposes certain research and development expenses and amortize domestic expenses over a 5 year period and foreign

expenses over a 15 year period, resulting in a deferred tax asset for the capitalized amounts.

and Subsidiaries

accordance with ASC 740, Income Taxes, specifically related to uncertain tax positions, a Company is required to use a recognition threshold

and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in

a tax return.

For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing

The Company believes its income tax filing positions and deductions will be sustained upon examination, and accordingly,

no reserves or related accruals for interest and penalties have been recorded as of September 30, 2025.

Company is subject to taxation in the United States federal and state jurisdictions.

The Company’s federal income tax and state

income tax returns are subject to examination by tax authorities.

The Company is not currently under examination by any tax authority.

July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S.

The OBBBA includes significant provisions,

such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modification to the international tax framework,

and the restoration of favorable tax treatment for certain business provisions.

The legislation has multiple effective dates, with certain

provisions effective in 2025 and other provisions implemented through 2027.

The Company does not anticipate the bill will have a material

impact on the financial statements.

September 30, 2025, the Company had approximately $ 68,941,426

7 unchanged sentences

SCHEDULE OF (LOSS) INCOME BEFORE PROVISION FOR TAX

Year ended September 30,

ended September 30,

$ ( 28,352,803 )

$ ( 7,090,508 )

Loss before provision for income taxes

before provision for income taxes

$ ( 27,314,088 )

2 unchanged sentences

SCHEDULE OF PROVISION FOR INCOME TAXES

September 30, 2024

September 30, 2023

Current (benefit)/provision

3 unchanged sentences

Total (benefit)/provision for income taxes

and Subsidiaries

following is a reconciliation of the effective income tax rate to the federal and state statutory rates.

2 unchanged sentences

For the Fiscal Year

September 30, 2024

September 30, 2023

statutory rate

4 unchanged sentences

State Rate Change

Other True Up Adjustments

Goodwill impairment

Write-Off of Related Party Note with Majority Owner

Write-Off of Related Party Note with Majority

Issuance Costs - Equity Financing

Fair Value Adjustments on Warrants

Global intangible income

Interest Expense

Change in Fair Value of

Loss on Excess Fair Value of Warrants

Other permanent differences

2 unchanged sentences

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

September 30, 2024

September 30, 2023

Deferred Tax Assets:

Net operating Loss carryforwards

Net operating

Loss carryforwards

Inventory and other reserves

Allowance for bad debt

CECL Allowance

Interest Expense Limitation

Deferred Revenue

Capitalized R&D

Warranty reserve

Lease Liability

Total gross deferred taxes

Valuation allowance

( 28,220,042 )

5 unchanged sentences

Goodwill amortization

Right of use assets

Total deferred tax liabilities

( 1,264,505 )

( 1,882,769 )

Total deferred tax assets (liabilities)

has concluded that it is more likely than not that the deferred tax assets will not be realized and has reduced the asset by a valuation

22 – BUSINESS COMBINATION

July 1, 2023, the Company under AIS, completed the acquisition of a leading service contractor and steel fabricator that specializes

in industrial and water treatment markets, Heisey Mechanical, Ltd.

(“Heisey”) based in Columbia, Pennsylvania.

The real estate

of the business was purchased at fair market value on August 30, 2023, for $ 1,500,000 in a separate transaction.

provides the water treatment industry with a variety of fabricated vessels and equipment including ASME pressure vessels, heat exchangers,

mix tanks, reactors, and other specialized fabricated equipment.

Additionally, the contracting team assists with installation and service

of fabricated items.

The company has over 33,000 square feet of manufacturing floor space in its facility and an experienced staff of

fabricators, welders, and field mechanics.

purchase price allocation presented below compares the preliminary allocation which was developed based on an estimate of fair values

of Heisey’s identifiable tangible and intangible assets acquired and liabilities assumed as of July 1, 2023, compared to the final

consideration transferred and allocation of Heisey’s tangible and intangible assets and liabilities, are as follows.

SCHEDULE OF BUSINESS ACQUISITION OF TANGIBLE AND INTANGIBLE ASSETS AND LIABILITIES

Consideration Transferred:

Seller’s note

Financed amount

Total consideration transferred

Purchase Price Allocation:

Contract assets

Machinery and equipment

Contract liabilities

Accrued expenses

Total consideration transferred

unaudited pro forma summary below presents the results of operations as if the Heisey acquisition occurred on October 1, 2022.

adjustments for the twelve months ended September 30, 2023, includes $ 127,800 of depreciation expense from acquired fixed assets, $ 127,883

of interest expense on the debt used in the acquisition.

The pro forma summary uses estimates and assumptions based on information available

Management believes the estimates and assumptions to be reasonable; however, actual results may have differed significantly

from this unaudited pro forma financial information.

The unaudited pro forma information does not reflect any cost savings, operating

synergies or revenue enhancements that might have been achieved from combining the operations.

SCHEDULE OF PRO FORMA FINANCIAL INFORMATION

For the year ended

September 30, 2023

( 9,173,748 )

August 30, 2023, the Company acquired a mortgage in the amount of $ 1,200,000 from Fulton Bank to finance the purchase of the properties

formerly owned by Heisey Mechanical Ltd.

The mortgage carries interest at the Secured Overnight Financing Rate (SOFR) plus 2.8 % and matures

on September 30, 2043.

Total deferred tax assets

(liabilities)

income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial

reporting purposes and the amounts used for income tax purposes.

and Subsidiaries

Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets.

Based upon the Company’s

history of operating losses, the Company has concluded that it is more likely than not that the benefit of its deferred tax assets will

not be realized.

Accordingly, the Company has provided a full valuation allowance for its deferred tax assets as of September 30, 2025,

utilization of the Company’s net operating loss and research and development credit carryforwards to offset future taxable income

may be subject to an annual limitation, pursuant to IRC Sections 382 and 383, as a result of ownership changes that may have occurred

or that could occur in the future.

An ownership change occurs when a cumulative change in ownership of more than 50% occurs within a

three-year period.

The Company has not completed an IRC Section 382/383 analysis regarding the limitation of net operating loss and research

and development credit carryforwards.

When this analysis is finalized, the Company plans to update its unrecognized tax benefits accordingly.

22 – DISCONTINUED OPERATIONS

3 unchanged sentences

(formerly Cemtrex Labs), to Mr.

to the on-going losses and risk associated with the SmartDesk business the Company has valued the royalty and SAFE agreement associated

with the SmartDesk sale at $ 0 and considers such consideration to be a gain contingency.

on sales projections for Cemtrex XR, Inc., the Company does not believe that it will exceed the sales levels required to exceed the $ 820,000

royalties due and has not accounted for any additional royalties at this time.

In accordance with ASC 310 – Receivables, the

Company has discounted the royalties due to $ 660,621 and during the years ended September 30, 2024, and 2023 the Company recognized $ 53,126

and $ 44,272 of royalties due, respectively, and will amortize the remaining amount over the period the royalties are due.

January 6, 2025, the Company and Saagar Govil signed an agreement to revise the purchase price structure and payment terms.

Agreement’s Purchase Price provisions were amended to reflect that the Purchase Price will solely consist of the royalties based

on the actual revenues generated in the three years following closing.

The provision requiring the total sum of royalties to reach a

minimum of $ 820,000 , with any shortfall to be paid by Purchaser, was removed from the Agreement.

Additionally,

the Company received $ 76,000 in royalty payments.

of September 30, 2024, there was $ 685,788 in trade receivables due from CXR, Inc.

Of these receivables $ 60,628 are related to costs paid

by Cemtrex related to payroll during the transition of employees to the new company and some subscription services that are set up on

auto pay with a credit card.

$ 215,408 is related to the current amount of royalties due and the remaining $ 409,752 is related to services

provided by Cemtrex Technologies Pvt.

it was agreed that the payment terms due under the royalties shall be as follows commencing on January 1, 2025:

Year (January 2025) Monthly Payment:

Year (January 2026) Monthly Payment:

Payment at the end of the Second Year (December 31, 2026):

Total outstanding royalties

transaction was approved by the Board of Directors with Saagar Govil abstaining from the vote.

on the new payment terms, management determined that it was appropriate to remove the previously recognized royalty receivable of $ 280,545

from the financial statements as of December 31, 2024.

of September 30, 2025, there were royalties receivable from the sale of Cemtrex, XR, Inc.

of $ 460,475 ,

of which $ 104,229

is considered short-term and is presented on the Company’s Consolidated Balance Sheet under the

caption “Trade receivables, net – related party.

The Company has taken a $ 165,771

allowance for expected credit losses against these royalties.

of September 30, 2025, there was $ 405,493

in trade receivables due from the Cemtrex XR successor company, CXR, Inc.

Of these receivables $ 104,229

is the short term due on the royalties on CXR Inc.’s revenues.

The remaining $ 301,264

is related to the services provided by Cemtrex Technologies Pvt.

in the normal course of business.

These balances are presented on the Consolidated Balance

Sheets under the caption “Trade receivables - related party”.

The long-term balance of royalties of $ 456,611 is presented

on the Company’s Consolidated Balance Sheets under the caption “Note receivable, net - related party”.

During Fiscal

year 2024, the Company recognized $ 665,520 of revenue from CXR, Inc.

following table summarizes the loss on the sale recorded during fiscal year 2023, included in Income/(loss) from discontinued operations,

net of tax in the accompanying Consolidated Statement of Operations.

SUMMARY OF LOSS ON SALE

Purchase Price

Less cash and cash equivalents transferred

Less liabilities assumed

Net purchase price

Accounts receivable, net

Inventory, net

Prepaid expenses and other assets

Property and equipment, net

Total Assets Sold

Liabilities Transferred

Accounts payable

Short-term liabilities

Long-term liabilities

Total Liabilities Transferred

Net assets sold

Pretax loss on sale of Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc.

$ ( 2,455,341 )

the first quarter of fiscal 2023, Vicon completed the closure of its discontinued operating entity Vicon Systems, Ltd.

located in Israel.

The Company received funds related to benefit obligations of $ 96,095 , which at the time of operational closure were not guaranteed to

be retrievable.

The company paid $ 7,010 in consulting fees for assistance in retrieving these funds.

The net amount of $ 89,085 is recognized

on the Company’s Consolidated Income Statement as part of the Loss on Discontinued Operations.

During the year, the Company

recorded $ 60,628

in current expected credit losses on receivables due from CXR Inc.

and Subsidiaries

from discontinued operations, net of tax and the loss on sale of discontinued operations, net of tax, of Cemtrex Advanced Technologies,

2 unchanged sentences

SCHEDULE OF FINANCIAL STATEMENTS INCLUDED WITHIN DISCONTINUED OPERATIONS

Year ended September 30,

the year ended September 30,

Total net sales

Cost of sales

Operating, selling, general and administrative expenses

Operating, selling, general and

administrative expenses

Other (income)/expenses

1 unchanged sentence

Amortization of discounted royalties

Loss on sale of discontinued operations

( 2,455,341 )

Adjustment of benefit obligation

Expected credit losses on royalty receivable

Adjustment of royalty agreement

Income tax provision

Discontinued operations, net of tax

Discontinued operations,

$ ( 243,552 )

8 unchanged sentences

shares issued subsequent to financial statements date

various dates subsequent to September 30, 2024, 1,324,503 shares of common stock were issued to satisfy Series A Warrants with an aggregate strike price value of $ 9,998,205 and

a fair market value of $ 21,515,777 .

various dates subsequent to September 30, 2025, 29,943 shares of common stock were issued to satisfy Series A Warrants with an aggregate

strike price value of $ 24,284 and a fair market value of $ 211,697 .

various dates subsequent to September 30, 2025, 2,316,480 shares of common stock were issued to satisfy Series B Warrants with an aggregate

strike price value of $ 5,657,264 and a fair market value of $ 15,804,854 .

various dates during November and December 2024, 51,833 shares of common stock were issued to make up for fractional shares from the

November 26, 2024 reverse stock split.

October 17, 2024, and November 18, 2024, the Company made an additional $ 50,000 investment, on each date via a simple agreement for future

equity (“SAFE”) in MasterpieceVR.

The SAFE provides that the Company will automatically receive shares of the entity based

on the conversion rate of future equity rounds up to a valuation cap, as defined.

Stock Reverse Stock Split

October 2, 2024 and November 26, 2024, the Company completed a 60:1 and 35:1 , respectively, reverse stock split of its common stock.

All share and per share data have been retroactively adjusted for the reverse splits.

Issuance of Note payable

November 21, 2024, the Company issued a note payable to Streeterville Capital, LLC, in the amount of $ 580,000 .

This note carries interest

of 8 % and matures on May 21, 2026 .

deduction of an original issue discount of $ 75,000 and legal fees of $ 5,000 , the Company received $ 500,000 in cash.

October 9, 2025, 67,671 shares of common stock were issued to make up for fractional shares from September 29, 2025, reverse stock split.

various dates subsequent to September 30, 2025, 3,000,296 shares of common stock were issued to relieve $ 7,844,000 of notes payable.

and Subsidiaries

of Note payable

November 7, 2025, the Company issued a Promissory Note with Streeterville Capital, LLC in the original principal amount of $ 7,025,000 .

From November 7, 2025, until December 31, 2025, interest will accrue on the outstanding balance of this Note at a per annum rate of interest

equal to the daily Secured Overnight Financing Rate (SOFR) as quoted by the Federal Reserve Bank of New York.

From January 1, 2026, until

this Note is paid in full, interest will accrue at the rate of eight percent ( 8 %) per annum.

After original issuance fees of $ 25,000 ,

the Company received cash of $ 7,000,000 for this agreement.

If this Note is outstanding on January 1, 2026, a one-time additional interest

fee of $ 1,050,000.00 will automatically be added to the outstanding balance.

This Note matures eighteen (18) months from the issuance

date with redemptions beginning at six (6) months from the issuance date.

The Company intends to use the cash proceeds to complete potential

acquisitions.

into a Material Definitive Agreement

November 13, 2025, the Company entered into a Share Purchase Agreement with Karl F.

Kiefer, an individual resident of Texas and Invocon,

Inc., a Texas corporation for the purchase of Invocon.

The Company expects to complete the transaction on or around January 1, 2026,

and is contingent on customary closing conditions.

The Agreement is for the purchase of 100% of the issued and outstanding shares of

Invocon for the purchase price of $ 7,060,000 .

December 11, 2025, the Company entered into a Securities Purchase Agreement with a single accredited institutional investor pursuant

to which the Company agreed to issue and sell to the Purchaser, in a registered direct offering securities consisting of shares of the

Company’s common stock, par value $ 0.001 per share, and/or pre-funded warrants to purchase shares of Common Stock for aggregate

gross proceeds of $ 2,000,000 .

The Offering closed on December 11, 2025.

The Company issued 310,000 shares of common stock and prefunded

warrants to purchase 356,667 shares of common stock.

The Prefunded warrants were immediately exercised, and the Company issued 666,667

shares of common stock in the aggregate.

December 23, 2025, the Company entered into a Securities Purchase Agreement with a single accredited institutional investor, pursuant

to which the Company issued and sold, in a registered direct offering, 330,000 shares of common stock at $ 2.50 per share and pre-funded

warrants to purchase 470,000 shares of common stock at $ 2.499 per warrant (with a $ 0.001 exercise price per underlying share), for aggregate

gross proceeds of $ 2,000,000 (net proceeds approximately $ 1,950,000 after estimated expenses).

The pre-funded warrants are immediately

exercisable, have no expiration date, and include a 4.99 % beneficial ownership limitation (which may be increased or decreased upon notice).

The offering was made pursuant to the Company’s effective shelf registration statement on Form S-3 (File No.

333-283995) and closed

on December 23, 2025.

The Company intends to use the net proceeds for working capital and general corporate purposes, which may include

potential future acquisitions.

No underwriter or placement agent was involved.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures