CEMTREX INC 10-K

ITEM 9A. CONTROLS AND PROCEDURES Disclosure Controls and Procedures We maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable assurance of achieving the desired control objectives, and we necessarily are required to apply our judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. Based on an evaluation under the supervision and with the participation of our management, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective as of September 30, 2025. Management’s Annual Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with GAAP. Because of inherent limitations, a system of internal control over financial reporting may not prevent or detect misstatements. Additionally, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to change in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our management, including our principal executive officer and principal accounting officer, conducted an evaluation of the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control—Integrated Framework (2013). Based on its evaluation, our management concluded that as of September 30, 2025, that our internal control over financial reporting were effective and there are no material weaknesses in our internal control over financial reporting. This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to Commission rules that permit the Company to provide only management’s report in this annual report. This report shall not be deemed to be filed for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing. Changes in Internal Control Over Financial Reporting There 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. ITEM 9B. OTHER INFORMATION None . ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS None. 39 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Directors and Executive Officers of the Registrant As of the date of this Annual Report, the members of our Board of Directors and Executive Officers are: Name and Address Age Positions and Offices Saagar Govil 39 Chairman of the Board of Directors, President, 135 Fell Ct. Chief Executive Officer, & Director Hauppauge, NY 11788 Paul J. Wyckoff 56 Chief Financial Officer 135 Fell Ct. Hauppauge, NY 11788 Brian Kwon 39 Director 135 Fell Ct. Hauppauge, NY 11788 Manpreet Singh 42 Director 135 Fell Ct. Hauppauge, NY 11788 Metodi Filipov 62 Director 135 Fell Ct. Hauppauge, NY 11788 Principal Occupations and Business Experience of Directors and Executive Officers The following is a brief account of the business experience of the Company’s directors and officers: Saagar Govil is the Company’s Chairman since June 2014, and the Chief Executive Officer and President since December 2011. He has been working at Cemtrex since 2008, initially as a field engineer, subsequently moving into sales, and management roles as Vice President of Operations. Saagar was recently recognized as a Forbes’ 30 Under 30 in 2016, Business Insiders #17 on Top 100 of Silicon Alley in 2015, and Top 40 Under 40 by Stony Brook University in 2014. Saagar Govil has a B.E. in Materials Engineering from Stony Brook University and completed the PLD program at Harvard Business School. Paul J. 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. Mr. Wyckoff has been with Cemtrex since March of 2014 when he joined as the Manager of Financial Reporting and since January of 2019 has served as the Company’s Corporate Controller. Prior to joining Cemtrex, Mr. Wyckoff was the Controller at Vaso Corporation (formerly Vasomedical, Inc.) a medical device distribution company based in Plainview, NY. Mr. Wyckoff has over 20 years of private accounting experience and holds a B.S. in Accounting from SUNY College at Old Westbury. Brian Kwon was appointed 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. Brian has completed the Harvard Business School General Management Program. 40 Manpreet Singh was appointed as a director on November 1, 2021, and is currently the founder and Chief Investment Officer of Singh Capital Partners (SCP), a multifamily office that directs investments into venture capital, real estate, and growth equity. SCP invests capital on behalf of Fortune 500 CXOs, Unicorn founders and operators and has executed investments in North America, Europe, and Asia. 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. Mr. Singh’s extensive knowledge of finance allows him to make valuable contributions to the Board. Metodi Filipov was appointed to the Board on February 9, 2018, and is an entrepreneur and technology executive with over 25 years of experience creating, operating, and driving growth for technology companies. He has a proven track record of identifying business opportunities and building compelling products. Metodi was formerly VP of Operations at Cemtrex from 2008 to 2010. After Cemtrex, Mr. Filipov served as Managing Director of Bianor, a mobile consulting company providing solutions for enterprise clients. There, he led the development and implementation of innovative mobile products in industries including aviation, pharmaceutical and entertainment. Metodi co-founded Flipps Media, an OTT video distribution platform positioned to be an alternative to traditional cable pay-per-view systems. Before Bianor, he served as product lead for Raritan, a data center technology organization, where he was an integral part of the transition team that led the company to becoming a global IT service management solutions provider. Prior to joining Raritan, Mr. Filipov served as VP of Operations at ISS, a security products company. There, he successfully managed product development and contract manufacturing across continents. Mr. Filipov has extensive experience delivering superior solutions with a focus on optimized efficiency and productivity. Each director of the Company serves for a term of one year or until the successor is elected at the Company’s annual shareholders’ meeting and is qualified, subject to removal by the Company’s shareholders. Each officer serves, at the pleasure of the board of directors, for a term of one year and until the successor is elected at the annual meeting of the board of directors and is qualified. Meetings of the Board of Directors During the fiscal year ended September 30, 2025, the Board of Directors held four meetings. Involvement in Certain Legal Proceedings During the past 10 years, other than as set forth below, none of our current directors, nominees for directors or current executive officers have been involved in any legal proceeding identified in Item 401(f) of Regulation S-K, including: 1. Any petition under the Federal bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he or she was a general partner at or within two years before the time of such filing, or any corporation or business association of which he or she was an executive officer at or within two years before the time of such filing; 2. Any conviction in a criminal proceeding or being named a subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); 3. Being subject to any order, judgment, or decree, not subsequently reversed, suspended, or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him or her from, or otherwise limiting, the following activities: i. Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity; 41 ii. Engaging in any type of business practice; or iii. Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws; 4. Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any type of business regulated by the Commodity Futures Trading Commission, securities, investment, insurance or banking activities, or to be associated with persons engaged in any such activity; 5. Being found by a court of competent jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated; 6. Being found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated; 7. Being subject to, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended, or vacated, relating to an alleged violation of: i. Any Federal or State securities or commodities law or regulation; or ii. Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or iii. Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or 8. Being subject to, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member. Committees of the Board Our Board of Directors currently has one standing committee: The Audit Committee. Compensation Committee As a “Controlled Company” as such term is defined under NASDAQ Listing Rule 5615, the Company is not required to have a Compensation Committee. Audit Committee The Audit Committee, which has been established in accordance with requirements of Section 3(a)(58)(A) of the Exchange Act, is comprised of the following independent directors: Metodi Filipov (Chair), Brian Kwon, and Manpreet Singh. The Board of Directors has determined that each member of the Audit Committee: (i) is independent, (ii) meets the financial literacy requirements of the Nasdaq Rules, and (iii) meets the enhanced independence standards established by the SEC. In addition, the Board has determined that Mr. Filipov qualifies as an “audit committee financial expert” as that term is defined in Item 407(d)(5)(ii) of Regulation S-K promulgated under the Exchange Act by the SEC. The Audit Committee is primarily concerned with the integrity of our financial statements, the independence, qualifications and performance of our independent registered public accounting firm, and our compliance with legal requirements. The Audit Committee operates under a written charter approved by the Board of Directors and the Audit Committee that reflects standards and requirements adopted by the SEC and NASDAQ. 42 As indicated in its charter, the Audit Committee’s duties include selecting and engaging our independent registered public accounting firm; reviewing the scope of the audit to be conducted by our independent registered public accounting firm; overseeing our independent registered public accounting firm and reviewing the results of its audit; reviewing our financial reporting processes, including the accounting principles and practices followed and the financial information provided to shareholders and others; overseeing our internal control over financial reporting and disclosure controls and procedures; and serving as our legal compliance committee. Nomination of Directors The Company does not currently have a standing nominating committee or a formal nominating committee charter. As a “Controlled Company” as such term is defined by NASDAQ Listing Rule 5615 the Company is not required to have a Nominating Committee. Currently, the independent members of the Board (Messrs. 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. In the ordinary course, absent special circumstances or a change in the criteria for Board membership, the incumbent directors who continue to be qualified for Board service and are willing to continue as directors are re-nominated. If the Board thinks it is in the best interest of the Company to nominate a new individual for director in connection with an annual meeting of shareholders, or if a vacancy occurs between annual shareholder meetings, the Board will seek potential candidates for Board appointments who meet the criteria for selection as a nominee and have the specific qualities or skills being sought. Director candidates will be selected based on input from members of the Board, senior management of the Company and, if deemed appropriate, a third-party search firm. Candidates for Board membership must possess the background, skills, and expertise to make significant contributions to the Board, to the Company and its shareholders. Desired qualities to be considered include substantial experience in business or administrative activities; breadth of knowledge about issues affecting the Company; and ability and willingness to contribute special competencies to Board activities. The Board of Directors intends to review the director nomination policy from time to time to consider whether modifications to the policy may be advisable as the Company’s needs and circumstances evolve, and as applicable legal or listing standards change. The Board may amend the director nomination policy at any time. The Board will consider director candidates recommended by shareholders and will evaluate such director candidates in the same manner in which it evaluates candidates recommended by other sources, as described above. Recommendations must be in writing and mailed to Cemtrex, Inc., 135 Fell Ct. Hauppauge, NY 11788, Attention: Corporate Secretary, and include all information regarding the candidate as would be required to be included in a proxy statement filed pursuant to the proxy rules promulgated by the SEC if the candidate were nominated by the Board of Directors (including such candidate’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected). The shareholder giving notice must provide (i) his or her name and address, as they appear on the Company’s books, and (ii) the number of shares of the Company which are beneficially owned by such shareholder. The Company may require any proposed nominee to furnish such other information it may require to be set forth in a shareholder’s notice of nomination which pertains to the nominee. Director Compensation The members of the Board receive quarterly compensation of $5,000 and stock options. Additionally, we reimburse our directors for expenses incurred in connection with attending board meetings. 43 Insider Trading Policy We recognize that the Company’s executive officers and directors may sell shares from time to time in the open market to realize value to meet financial needs and diversify their holdings, particularly in connection with exercises of stock options. All such transactions are required to comply with the Company’s insider trading policy. Section 16 (a) Beneficial Ownership Reporting Compliance of the Securities Exchange Act Section 16(a) of the Exchange Act requires directors, executive officers and persons who beneficially own more than 10% of our common stock (collectively, “Reporting Persons”) to file initial reports of ownership and reports of changes in ownership of our common stock with the SEC. Reporting Persons are required by SEC regulations to furnish us with copies of all Section 16(a) reports they file. To our knowledge, based solely on our review of the copies of such reports received or written representations from certain Reporting Persons that no other reports were required, we believe that during the year ended September 30, 2025, all Reporting Persons timely complied with all applicable filing requirements. Communications with Directors Shareholders, associates of the Company and other interested parties may communicate directly with the Board of Directors, with the non-management Directors or with a specific Board member, by writing to the Board (or the non-management Directors or a specific Board member) and delivering the communication in person or mailing it to: Board of Directors, Privileged and Confidential, c/o Saagar Govil, CEO, Cemtrex, Inc., 135 Fell Ct. Hauppauge, NY 11788. Correspondence will be discussed at the next scheduled meeting of the Board of Directors, or as indicated by the urgency of the matter. From time to time, the Board of Directors may change the process by which shareholders may communicate with the Board of Directors or its members. Any changes in this process will be posted on the Company’s website or otherwise publicly disclosed. Corporate Governance The Company has an ongoing commitment to good governance and business practices. In furtherance of this commitment, we regularly monitor, and are briefed by outside counsel on, developments in the area of corporate governance and securities law and review our policies and procedures in light of such developments. We comply with the rules and regulations promulgated by the SEC and implement other corporate governance practices we believe are in the best interests of the Company and the shareholders. Code of Ethics We have adopted a code of ethics as of June 28, 2016, that applies to our principal executive officer, principal financial officer, as well as our employees. Our standards are in writing and are posted on our website. The following is a summation of the key points of the Code of Ethics we adopted: Honest and ethical conduct, including ethical handling of actual or apparent conflicts of interest between personal and professional relationships; Full, fair, accurate, timely, and understandable disclosure reports and documents that a small business issuer files with, or submits to, the Commission and in other public communications made by our Company; Full compliance with applicable government laws, rules and regulations; The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and Accountability for adherence to the code. Board Leadership and Structure Saagar Govil, our Chief Executive Officer, also serves as Chairman of the Board of Directors. The Board believes that the Company and its shareholders are best served by having the Chief Executive Officer also serve as Chairman of the Board. The Board also believes that this structure is appropriate in light of the size of our Company and corresponding size of our Board and the complexity of our business. We believe that Mr. Govil is best positioned to develop agendas that ensure that our Board’s time and attention are focused on the matters that are most critical to us. 44 ITEM 11. EXECUTIVE COMPENSATION The compensation discussion addresses all compensation awarded to, earned by, or paid to the Company’s named executive officers (“NEO”), which currently consists of Saagar Govil, the Chairman, Chief Executive Officer, President and Secretary, and Paul J. Wyckoff, CFO. As of the date of this Annual Report, Saagar Govil and Paul J. Wyckoff are currently earning compensation from the Company. Paul J. 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. OPTION PRINCIPAL AND POSITION YEAR SALARY BONUS AWARDS OTHER TOTAL ($) ($) ($) ($) ($) Saagar Govil 2025 767,885 300,000 - 49,111 1,116,996 Chairman of the Board 2024 744,231 300,000 - 45,220 1,089,451 Chief Executive Officer, and President Paul J. Wyckoff 2025 155,769 35,000 - 16,487 207,256 Chief Financial Officer since January 2025 2024 150,000 - - 15,853 165,853 Interim CFO since January 2022 (1) The Option Awards Column in the table above reflects the aggregate grant date fair value of the award granted in the year noted. Please see Options/SAR Grants in the Last Fiscal Year below for more information relating to this option grant. (2) Other compensation represents amounts paid by the company for medical, dental, and vision, benefits. NARRATIVE TO SUMMARY COMPENSATION TABLE At this time, we do not have an employment agreement with Saagar Govil or Paul J. Wyckoff, though the Company may enter into such an agreement with them on terms and conditions usual and customary for the industry. 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 on Mr. Govil or Mr. Wyckoff. PAY VERSUS PERFORMANCE Year 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 Net Loss (a) (b) (1) (c) (2) (d) (e) (4) (f) (5) (g) (6) 2025 1,116,996 $ 1,105,300 $ 207,256 $ 172,256 $ 0.19 (28,292,520 ) 2024 $ 1,089,451 $ 702,443 $ 165,853 $ 165,853 $ 2.53 $ (7,635,505 ) 2023 $ 645,803 $ 562,675 $ 162,291 $ 162,291 $ 65.03 $ (9,233,438 ) 2022 $ 637,534 $ 554,406 $ 96,635 $ 96,635 $ 18.10 $ (13,292,242 ) 1. The 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 in our Summary Compensation Table. Refer to the Summary Compensation Table above. 2. The dollar amounts reported in column (c) represent the amount of “compensation actually paid” to Mr. Govil, as computed in accordance with Item 402(v) of Regulation S-K and do not reflect the total compensation actually realized or received by Mr. Govil. In accordance with these rules, these amounts reflect “Total Compensation” as set forth in the Summary Compensation Table for each year, adjusted as shown below. Equity values are calculated in accordance with FASB ASC Topic 718, and the valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. 45 3. The dollar amounts reported in column (d) represent the average of the amounts reported for our NEOs as a group (excluding Mr. Govil) in the “Total” column of the Summary Compensation Table in each applicable year. The names of the NEOs included for these purposes in each applicable year are as follows: Paul J. Wyckoff, Chief Financial Officer (Interim Chief Financial Officer prior to January 6, 2025). 4. The dollar amounts reported in column (e) represent the average amount of “compensation actually paid” to the NEOs as a group (excluding Mr. Govil), as computed in accordance with Item 402(v) of Regulation S-K. In accordance with these rules, these amounts reflect “Total Compensation” as set forth in the Summary Compensation Table for each year, adjusted as shown below. 5. Total Shareholder Return (TSR) is calculated by dividing (a) the difference between our share price at the end of each fiscal year shown and the beginning of the measurement period, and the beginning of the measurement period by (b) our share price at the beginning of the measurement period. The beginning of the measurement period for each year in the table is September 30, 2021. 6. The dollar amounts reported represent the amount of net income reflected in our audited financial statements for the applicable year. Adjustments to Determine Compensation “Actually Paid” for [PEO][Non-PEO NEOs] 2025 2024 2023 2022 Deduction for Change in the Actuarial Present values reported under the “Change in Pension Value and “Nonqualified Deferred Compensation Earning” Column of the SCT $ - $ - $ - $ - 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 $ (8,772 ) $ (84,879 ) $ (1,948 ) $ (53,747 ) Increase/deduction for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year $ (2,924 ) $ (2,129 ) $ (2,207 ) $ (29,381 ) 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 $ (11,696 ) $ (87,008 ) $ (4,155 ) $ (83,128 ) OPTIONS/SAR GRANTS IN THE LAST FISCAL YEAR None. AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION/SAR VALUES None. OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END The following table presents information regarding our NEOs’ unexercised options to purchase Common Stock as of September 30, 2025: Option Awards Name Number of Securities Underlying Unexercised Options Exercisable Option Exercise Price Option Expiration Date Saagar Govil 1 $ 1,759,228.27 2/25/2026 Saagar Govil 1 $ 2,100,630.00 2/25/2026 Saagar Govil 1 $ 2,520,756.00 2/25/2026 Saagar Govil 1 $ 3,024,907.20 2/25/2026 46 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The following table sets forth certain information known to us with respect to the beneficial ownership of our common stock as of December 22, 2025, by: all persons who are beneficial owners of five percent (5%) or more of our common stock; each of our directors; each of our executive officers; and all current directors and executive officers as a group. Except as otherwise indicated, and subject to applicable community property laws, the persons named in the table below have sole voting and investment power with respect to all shares of common stock held by them. As of December 22, 2025, 6,911,663 shares of Common Stock were issued and outstanding. In addition, there were 50,000 shares of Series C Preferred Stock outstanding which are entitled to vote 69,185,747 shares in the aggregate, all of which is held by Saagar Govil and 2,840,919 shares of Series 1 Preferred Stock outstanding which are entitled to vote 5,681,838 shares in the aggregate. Accordingly, there are a total of 81,779,248 shares outstanding. Beneficial ownership is determined in accordance with the rules of the SEC. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock subject to options held by that person that are currently exercisable or exercisable within 60 days of December 22, 2025, are deemed outstanding. Such shares, however, are not deemed as of December 22, 2025, outstanding for the purpose of computing the percentage ownership of any other person. Name and Address of Beneficial Owner Common Stock Series 1 Preferred Stock Series C Preferred Stock Number of Percent of Number of Percent of Number of Percent of Shares Owned Class(1) Shares Owned Class(1)(2) Shares Owned Class(1)(3) Saagar Govil 6 0.0001 % 168,852 5.94 % 50,000 100 % 135 Fell Ct. Hauppauge, NY 11788 Paul J. Wyckoff - * - * - * 135 Fell Ct. Hauppauge, NY 11788 Brian Kwon 1 * - * - * 135 Fell Ct. Hauppauge, NY 11788 Manpreet Singh 1 * - * - * 135 Fell Ct. Hauppauge, NY 11788 Metodi Filipov 1 * - * - * 135 Fell Ct. Hauppauge, NY 11788 All Directors and Executive Officers as a Group (5 persons) 9 0.00 % 168,852 5.94 % 50,000 100.00 % * Less than one percent of outstanding shares. (1) Except as otherwise noted herein, the percentage is determined on the basis of 6,911,663 shares of our Common Stock outstanding plus securities deemed outstanding pursuant to Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Under Rule 13d-3, a person is deemed to be a beneficial owner of any security owned by certain family members and any security of which that person has the right to acquire beneficial ownership within 60 days, including, without limitation, shares of our common stock subject to currently exercisable options. (2) This percentage is based on the 6,911,663 shares of our Common Stock outstanding, the 69,185,747 votes that the Series C Preferred Stock is entitled to vote, and the 5,031,788 votes that the Series 1 Preferred Stock is entitled to vote based on 2 votes per share. (3) Pursuant to the Certificate of Designation of the Series C Preferred Stock, each issued and outstanding share of Series C Preferred Stock are entitled to the number of votes per share equal to the result of (i) the total number of shares of Common Stock outstanding at the time of such vote multiplied by 10.01, and divided by (ii) the total number of shares of Series C Preferred Stock outstanding at the time of such vote, at each meeting of our shareholders with respect to any and all matters presented to our shareholders for their action or consideration, including the election of directors. (4) Consists of actual amount of Common Stock, Series C, and Series 1 Preferred Stock owned. As described above each share of Series C is entitled to 1,383.71 votes. Series 1 Preferred Stock is entitled to 2 votes per share. 47 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE Aside from the following, there have been no transactions since October 1, 2022 to which we have been a party, including transactions in which the amount involved in the transaction exceeds the lesser of $120,000 or 1% of the average of our total assets at year-end for the last two completed fiscal years, and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than 5% of our capital stock or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than equity and other compensation, termination, change in control and other arrangements, which are described elsewhere in this Annual Report on Form 10-K. As 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 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 with the charge recorded in general and administrative expenses on the Company’s Consolidated Statements of Operations and Comprehensive Loss. On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil. On January 6, 2025, the Company and Saagar Govil signed an agreement to revise the purchase price structure and payment terms. The 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: ● First Year (January 2025) Monthly Payment: $10,000 ● Second Year (January 2026) Monthly Payment: $20,000 ● Balloon Payment at the end of the Second Year (December 31, 2026): Total outstanding royalties This transaction was approved by the Board of Directors with Saagar Govil abstaining from the vote. Based 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. As 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. The Company has taken a $165,771 allowance for expected credit losses against these royalties. As 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. Ltd. in the normal course of business. During the year, the Company recorded $60,628 in current expected credit losses on receivables due from CXR Inc. On 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. 48 Director Independence The 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 Company. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The following table sets forth the aggregate fees billed to the Company for the years ended September 30, 2025, and 2024 by Grassi & Co. Certified Public Accountants, the Company’s independent auditor: 2025 2024 Audit Fees $ 332,910 $ 380,175 Audit-Related Fees 48,806 41,100 Tax Fees 35,963 36,276 Totals $ 417,679 $ 457,551 Audit fees principally include fees for the audit of our consolidated financial statements included in our annual report on Form 10-K and the review of financial statements included in our quarterly reports on Form 10-Q. Audit-related fees consist of fees for other attestation and related services that are reasonably related to the performance of the audit or review of our financial statements. 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 Tax fees consist of tax compliance services. 49 PART IV ITEM 15 EXHIBITS AND FINANCIAL STATEMENTS (a) Financial Statements and Notes to the Consolidated Financial Statements See Index to Consolidated Financial Statements on page F-1 at beginning of attached financial statements. (b) Exhibits Exhibit Incorporated by Reference Filed or Furnished Number Exhibit Description Form Filing Date Herewith 2.1 Stock Purchase Agreement, dated December 15, 2015 Form 8-K/A 9/26/2016 3.1 Certificate of Incorporation filed with the State of Delaware. Form 10-12G 5/22/2008 3.2 Bylaws Form 10-12G 5/22/2008 3.3 Amendment to Certificate of Incorporation Form 10-12G 5/22/2008 3.4 Amendment to Certificate of Incorporation Form 10-12G 5/22/2008 3.5 Amendment to Certificate of Incorporation Form 10-12G 5/22/2008 3.6 Amendment to Certificate of Incorporation Form 10-12G 5/22/2008 3.7 Amendment to Certificate of Incorporation Form 8-K 8/22/2016 3.8 Amendment to Certificate of Incorporation Form 8-K 9/30/2024 3.9 Amendment to Certificate of Incorporation Form 8-K 11/21/2024 3.10 Amendment to Certificate of Incorporation Form 8-K 9/24/2025 3.11 Certificate of Designation of the Series A Preferred Shares Form 8-K 9/10/2009 3.12 Certificate of Designation of the Series 1 Preferred Shares Form 8-K 1/24/2017 3.13 Amendment to Certificate of Incorporation Form 8-K 9/8/2017 3.14 Certificate of Correction to the Certificate of Amendment Form 8-K 6/12/2019 3.15 Amended Certificate of Designation of the Series 1 Preferred Shares Form 8-K 4/1/2020 3.16 Amendment to Certificate of Incorporation Form 10-K 1/5/2021 3.17 Certificate of Correction to the Certificate of Amendment Form 10-Q 5/28/2021 3.18 Amendment to Certificate of Incorporation Form 8-K 1/20/2023 3.19 Amendment to Certificate of Incorporation Form 8-K 8/2/2024 4.1 Form of Subscription Rights Certificate Form S-1 8/29/2016 4.2 Form of Series 1 Preferred Stock Certificate Form S-1/A 11/23/2016 4.3 Form of Series 1 Warrant Form S-1/A 12/7/2016 4.4 Form of Common Stock Purchase Warrant Form 8-K 3/22/2019 4.5 Form of Prefunded Warrant Form 8-K 5/3/2024 4.6 Form of Series A Common Stock Purchase Warrant Form 8-K 5/3/2024 4.7 Form of Series B Common Stock Purchase Warrant Form 8-K 5/3/2024 5.1 Opinion of the Doney Law Firm Form S-1/A 4/30/2024 10.1 Amendment to Loan Documents Between Advanced Industrial Services, Inc. and Fulton Bank, N.A. Form 10-Q 5/11/2023 10.2 Asset Purchase agreement between Cemtrex, Inc. and Saagar Govil, dated November 22, 2022 Form 8-K 11/29/2022 10.3 Asset Purchase agreement between Cemtrex, Inc. and Saagar Govil, dated November 22, 2022 Form 8-K 11/29/2022 10.4 Simple Agreement for Future Equity (SAFE) between Cemtrex, Inc. and Saagar Govil, dated November 18, 2022 Form 8-K 11/29/2022 10.5 2020 Equity Compensation Plan Form S-8 8/17/2020 10.6 Asset Purchase Agreement, dated as of June 7, 2023 Form 8-K 12/6/2023 10.7 Form of Lock-Up Agreement Form S-1/A 4/30/2024 10.8 Note Purchase Agreement between Cemtrex Inc. and Streeterville Capital, LLC, dated September 30, 2021 Form S-1/A 4/30/2024 10.9 Amendment to Promissory Note between Cemtrex Inc. and Streeterville Capital, LLC, dated September 14, 2022 Form S-1/A 4/30/2024 10.10 Amendment to Promissory Note between Cemtrex Inc. and Streeterville Capital, LLC, dated August 30, 2023 Form S-1/A 4/30/2024 10.11 Form of Underwriting Agreement Form 8-K 5/3/2024 10.12 Standstill Agreement, dated April 30, 2024 Form 8-K 5/1/2024 10.13 Underwriting Agreement, dated May 28, 2025 with Aegis Capital Corp. Form 8-K 5/29/2025 10.14 Share Purchase Agreement between Cemtrex, Inc, Karl F. Kiefer, and Invocon, Inc. Form 8-K 11/19/2025 10.15 Securities Purchase Agreement, dated December 11, 2025 Form 8-K 12/11/2025 21.1 Subsidiaries of the Registrant X 23.1 Consent of Grassi & Co, CPAs, P.C., Independent Registered Public Accounting Firm X 31.1 Certification of Chief Executive Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. X 31.2 Certification of Interim Chief Financial Officer and Principal Financial Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. X 32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act 0f of 2002. X 32.2 Certification of Interim Chief Financial Officer and Principal Financial Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act 0f of 2002. X 99.1 Order pursuant to Section 8A of the Securities Act – dated September 30, 2022. Form 8-K 10/4/2022 101.INS Inline XBRL Instance Document X 101.SCH Inline XBRL Taxonomy Extension Schema X 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase X 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase X 101.LAB Inline XBRL Taxonomy Extension Label Linkbase X 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase X 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) X ITEM 16. FORM 10-K SUMMARY None. 50 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CEMTREX, INC. December 29, 2025 By: /s/ Saagar Govil Saagar Govil, Chairman of the Board, CEO, President and Secretary (Principal Executive Officer) December 29, 2025 By: /s/ Paul J. Wyckoff Paul J. Wyckoff, Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. December 29, 2025 By: /s/ Saagar Govil Saagar Govil, Chairman of the Board, CEO, President and Secretary (Principal Executive Officer) December 29, 2025 By: /s/ Paul J. Wyckoff Paul J. Wyckoff, Chief Financial Officer (Principal Financial and Accounting Officer) December 29, 2025 By: /s/ Brian Kwon Brian Kwon, Director December 29, 2025 By: /s/ Manpreet Singh Manpreet Singh, Director December 29, 2025 By: /s/ Metodi Filipov Metodi Filipov, Director 51 Index to the Consolidated Financial Statements Contents Page(s) Report of Independent Registered Public Accounting Firm F-2 Consolidated Balance Sheets at September 30, 2025 and 2024 F-5 Consolidated Statements of Operations for the Fiscal Years Ended September 30, 2025 and 2024 F- 6 Consolidated Statements of Comprehensive Loss for the Fiscal Years Ended September 30, 2025 and 2024 F-7 Consolidated Statements of Shareholders’ Equity for the Fiscal Years Ended September 30, 2025 and 2024 F-8 Consolidated Statements of Cash Flows for Fiscal Years Ended September 30, 2025 and 2024 F-10 Notes to the Consolidated Financial Statements F-12 F- 1 Cemtrex Inc. and Subsidiaries REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of Cemtrex, Inc. and Subsidiaries Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Cemtrex, Inc. and Subsidiaries (the “Company”) as of September 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”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the two-year period ended September 30, 2025, in conformity with accounting principles generally accepted in the United States of America. Substantial Doubt Regarding the Company’s Ability to Continue as a Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 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. 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. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. F- 2 Cemtrex Inc. and Subsidiaries Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Valuation of Related Party Receivables Description of the matter At 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. How the Critical Audit Matter was addressed in the Audit We obtained an understanding of controls over the Company’s accounting and disclosures for related party transactions. Our audit procedures primarily included the following: ● Obtaining an understanding of certain related party transaction by reading relevant agreements, as applicable; ● Performing other audit procedures on certain open balances including, among other things, vouching to invoices from the related parties and source documentation representing subsequent cash collections of such receivables; ● Evaluating managements allowance for credit losses related to these receivables and the assumptions and inputs used in their assessment; ● Scanning subledgers and documentation obtained in other audit areas for known related parties; and, ● Finally, we evaluated the Company’s disclosures related to the matters described above. F- 3 Cemtrex Inc. and Subsidiaries Valuation of Warrants Description of matter As 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 fair value of the Series B warrants revaluation as a critical audit matter. The 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. The calculated fair values are sensitive to changes in these key assumptions. How the Critical Audit Matter was addressed in the Audit Our audit procedures related to the evaluation of the fair value of the warrants included the following, among others: ● We assessed the qualifications and competence of management. ● We evaluated the methodologies used to determine the fair values of the warrants issued. ● We tested the assumptions used within the valuation models to estimate the fair value of the warrants. ● We evaluated the design and operating effectiveness of certain controls over the valuation process, including controls over the development of the key assumptions such as the risk-free rate, stock price, strike price, remaining term, and volatility. ● We assessed the sufficiency of the Company’s disclosure of its accounting for these warrants issued in Note 18. /s/ GRASSI & Co., CPAs, P.C. We have served as the Company’s auditor since 2021. Jericho, New York December 29, 2025 Auditor PCAOB ID Number 606 F- 4 Cemtrex Inc. and Subsidiaries CONSOLIDATED BALANCE SHEETS September 30, September 30, 2025 2024 Assets Current assets Cash and cash equivalents $ 4,974,303 $ 3,897,511 Restricted cash 1,372,738 1,522,881 Trade receivables, net 13,133,424 11,159,676 Trade receivables, net - related party 405,493 685,788 Inventory, net 6,584,944 6,988,529 Contract assets, net 980,164 985,207 Prepaid expenses and other current assets 1,556,432 1,456,687 Total current assets 29,007,498 26,696,279 Property and equipment, net 9,651,996 9,133,578 Right-of-use operating lease assets 2,003,967 1,933,378 Royalties receivable, net - related party 190,475 456,611 Digital assets 1,158,238 - Goodwill 3,708,347 3,708,347 Other 2,067,755 2,187,265 Total Assets $ 47,788,276 $ 44,115,458 Liabilities & Stockholders’ Equity Current liabilities Accounts payable $ 4,492,859 $ 4,520,173 Sales tax payable 76,008 73,024 Revolving line of credit 3,176,096 3,125,011 Current maturities of long-term liabilities 8,925,497 4,732,377 Operating lease liabilities - short-term 918,391 832,823 Deposits from customers 158,344 408,415 Accrued expenses 2,223,521 1,825,919 Accrued payable on inventory in transit 652,179 208,433 Contract liabilities 1,655,055 1,254,204 Deferred revenue 1,383,036 1,297,616 Accrued income taxes 162,173 314,827 Total current liabilities 23,823,159 18,592,822 Long-term liabilities Long-term debt 4,586,779 13,270,178 Long-term operating lease liabilities 1,153,221 1,159,204 Other long-term liabilities 289,483 274,957 Deferred Revenue - long-term 482,978 658,019 Warrant liabilities 8,735,197 5,199,436 Total long-term liabilities 15,247,658 20,561,794 Total liabilities 39,070,817 39,154,616 Commitments and contingencies - - Stockholders’ equity Preferred stock, $ 0.001 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 per share) 2,705 2,457 Series C, 100,000 shares authorized, 50,000 shares issued and outstanding at September 30, 2025, and September 30, 2024 50 50 Common stock, $ 0.001 par 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 831 1 Additional paid-in capital 105,668,565 73,262,549 Accumulated deficit ( 99,397,741 ) ( 71,355,386 ) Treasury stock, 64,100 shares of Series 1 Preferred Stock at September 30, 2025, ( 148,291 ) ( 148,291 ) Accumulated other comprehensive income 2,591,340 2,949,297 Total Cemtrex stockholders’ equity 8,717,459 4,710,677 Non-controlling interest - 250,165 Total liabilities and stockholders’ equity $ 47,788,276 $ 44,115,458 The accompanying notes are an integral part of these consolidated financial statements. F- 5 Cemtrex Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF OPERATIONS For the year ended September 30, 2025 September 30, 2024 Revenues $ 76,488,088 $ 66,863,884 Cost of revenues 44,199,562 39,385,680 Gross profit 32,288,526 27,478,204 Operating expenses General and administrative 29,425,560 28,860,019 Research and development 2,353,140 3,357,455 Goodwill impairment - 530,475 Total operating expenses 31,778,700 32,747,949 Operating income/(loss) 509,826 ( 5,269,745 ) Other income/(expense) Other income/(expense), net 159,027 ( 622,558 ) Interest expense ( 2,110,726 ) ( 2,169,469 ) Changes in fair value of digital assets 150,009 - Loss on exercise of warrant liabilities ( 15,088,812 ) ( 7,255,528 ) Changes in fair value of warrant liability ( 10,933,412 ) 7,840,951 Total other income/(expense), net ( 27,823,914 ) ( 2,206,604 ) Net loss before income taxes ( 27,314,088 ) ( 7,476,349 ) Income tax expense 734,880 202,280 Loss from continuing operations ( 28,048,968 ) ( 7,678,629 ) (Loss)/income from discontinued operations, net of tax ( 243,552 ) 43,124 Net loss ( 28,292,520 ) ( 7,635,505 ) Less net loss in noncontrolling interest ( 180,152 ) ( 406,014 ) Net loss attributable to Cemtrex, Inc. stockholders $ ( 28,112,368 ) $ ( 7,229,491 ) Income/(loss) per share - Basic & Diluted Continuing Operations $ ( 210.88 ) $ ( 269.47 ) Discontinued Operations $ ( 1.84 ) $ 1.58 Weighted Average Number of Shares-Basic & Diluted 132,396 27,240 F- 6 Cemtrex Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS For the year ended September 30, 2025 September 30, 2024 Other comprehensive loss Net loss $ ( 28,292,520 ) $ ( 7,635,505 ) Foreign currency translation loss ( 357,957 ) ( 127,409 ) Comprehensive loss ( 28,650,477 ) ( 7,762,914 ) Less net loss in noncontrolling interest ( 180,152 ) ( 406,014 ) Comprehensive loss attributable to Cemtrex, Inc. stockholders $ ( 28,470,325 ) $ ( 7,356,900 ) The accompanying notes are an integral part of these consolidated financial statements. F- 7 Cemtrex Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY Preferred Stock Series 1 Preferred Stock Series C Common Stock Par Treasury Stock, 64,100 shares of Accumulated Par Value $0.001 Par Value $0.001 Value $0.001 Additional Series 1 other Cemtrex Non- Number of Number of Number of Paid-in Accumulated Preferred Comprehensive Stockholders’ controlling Shares Amount Shares Amount Shares Amount Capital Deficit Stock Income Equity interest Balance at September 30, 2024 2,456,827 $ 2,457 50,000 $ 50 946 $ 1 $ 73,262,549 $ ( 71,355,386 ) $ ( 148,291 ) $ 2,949,297 $ 4,710,677 $ 250,165 Foreign currency translation loss ( 357,957 ) ( 357,957 ) - Share-based compensation 14,236 14,236 - Dividends paid in Series 1 preferred shares 252,278 252 - ( 252 ) - Cancelation of 3,778 shares of Series 1 Preferred Shares ( 3,778 ) ( 4 ) - 4 - Shares issued to pay debt 437,394 437 5,235,590 5,236,027 Exercise of Series A warrants 88,492 88 21,515,681 21,515,769 Exercise of Series B warrants 200,551 201 4,409,404 4,409,605 Shares issued in offering 83,334 83 1,058,866 1,058,949 Shares issued in over allotment exercise 12,500 13 172,487 172,500 Issuance of roundup shares 7,389 8 8 Loss attributable to noncontrolling interest - ( 180,152 ) Elimination of noncontrolling interest 70,013 - 70,013 ( 70,013 ) Net loss ( 28,112,368 ) - ( 28,112,368 ) Balance at September 30, 2025 2,705,327 $ 2,705 50,000 $ 50 830,606 $ 831 $ 105,668,565 $ ( 99,397,741 ) $ ( 148,291 ) $ 2,591,340 $ 8,717,459 $ - The accompanying notes are an integral part of these consolidated financial statements. F- 8 Cemtrex Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY Preferred Stock Series 1 Preferred Stock Series C Common Stock Par Treasury Stock, 64,100 shares of Accumulated Par Value $0.001 Par Value $0.001 Value $0.001 Additional Series 1 other Cemtrex Non- Number of Number of Number of Paid-in Accumulated Preferred Comprehensive Stockholders’ controlling Shares Amount Shares Amount Shares Amount Capital Deficit Stock Income Equity interest Balance at September 30, 2023 2,293,016 $ 2,293 50,000 $ 50 33 $ 1 $ 68,882,750 $ ( 64,125,895 ) $ ( 148,291 ) $ 3,076,706 $ 7,687,614 $ 656,179 Foreign currency translation loss ( 127,409 ) ( 127,409 ) - Share-based compensation 30,235 30,235 Dividends paid in Series 1 preferred shares 235,762 236 - ( 236 ) - Purchase of treasury stock ( 69,705 ) ( 69,705 ) Cancellation of treasury stock ( 71,951 ) ( 72 ) - ( 69,633 ) 69,705 - Shares issued to pay for services 7 - 169,000 169,000 Exercise of prefunded warrants 374 - 3,190,320 3,190,320 Exercise of Series A warrants 140 - 1,060,113 1,060,113 Issuance of roundup shares 392 - - - Loss attributable to noncontrolling interest - ( 406,014 ) Net loss ( 7,229,491 ) ( 7,229,491 ) Balance at September 30, 2024 2,456,827 $ 2,457 50,000 $ 50 946 $ 1 $ 73,262,549 $ ( 71,355,386 ) $ ( 148,291 ) $ 2,949,297 $ 4,710,677 $ 250,165 The accompanying notes are an integral part of these consolidated financial statements. F- 9 Cemtrex Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS For the year ended September 30, 2025 2024 Cash Flows from Operating Activities Net loss $ ( 28,292,520 ) $ ( 7,635,505 ) Adjustments to reconcile net loss to net cash used by operating activities Depreciation and amortization 1,355,538 1,328,741 Loss/(gain) on disposal of property and equipment 17,552 ( 19,133 ) Noncash lease expense 941,015 829,119 Goodwill impairment - 530,475 Bad debt recovery ( 9,784 ) ( 79,006 ) Loss on write-off of related party receivables 216,399 1,409,500 Contract modification - related party 280,545 - Share-based compensation 14,236 30,235 Shares issued to pay for services - 169,000 Interest expense paid in equity shares 294,977 Accrued interest on notes payable 1,050,296 1,189,629 Non-cash royalty income ( 99,001 ) ( 53,126 ) Amortization of original issue discounts on notes payable 41,667 - Loan origination costs 5,000 72,533 Receipt of SOL from staking ( 12,522 ) - Non-cash transaction fees 2,755 - Unrealized gain on digital assets ( 150,009 ) - Loss on excess fair value of warrants 15,088,812 7,255,528 Changes in fair value of warrant liability 10,933,412 ( 7,840,951 ) Changes in operating assets and liabilities net of effects from acquisition of subsidiaries: Trade receivables ( 1,970,245 ) ( 1,870,975 ) Trade receivables - related party 108,488 ( 63,462 ) Inventory 403,585 1,893,759 Contract assets 11,324 753,994 Prepaid expenses and other current assets ( 99,745 ) 733,168 Other assets 219,510 ( 251,256 ) Accounts payable ( 27,314 ) ( 818,733 ) Sales tax payable 2,984 37,195 Operating lease liabilities ( 932,019 ) ( 831,536 ) Deposits from customers ( 250,071 ) 350,981 Accrued expenses 841,348 ( 690,038 ) Contract liabilities 400,851 273,885 Deferred revenue ( 89,621 ) ( 355,699 ) Income taxes payable ( 152,654 ) ( 71,285 ) Other liabilities 14,526 ( 226,397 ) Net cash provided by/(used in) operating activities 159,315 ( 3,949,360 ) Cash Flows from Investing Activities Purchase of property and equipment ( 1,931,534 ) ( 1,297,346 ) Proceeds from sale of property and equipment 29,257 63,953 Royalties on related party revenues 40,000 76,000 Purchase of digital assets ( 998,462 ) - Investment in MasterpieceVR ( 100,000 ) ( 100,000 ) Net cash used by investing activities ( 2,960,739 ) ( 1,257,393 ) Cash Flows from Financing Activities Proceeds on revolving line of credit 33,144,497 33,071,722 Payments on revolving line of credit ( 33,093,412 ) ( 30,019,244 ) Payments on debt ( 1,095,564 ) ( 7,923,914 ) Payments on Paycheck Protection Program Loans ( 50,628 ) ( 40,486 ) Proceeds on Loan from CEO 200,000 - Payments on Loan from CEO ( 200,000 ) - Proceeds on bank loans - 340,267 Proceeds from notes payable 500,000 - Proceeds from warrant exercises 3,438,918 - Proceeds from offerings 1,463,550 10,035,292 Expenses on offerings ( 232,100 ) ( 995,333 ) Purchases of treasury stock - ( 69,705 ) Net cash provided by financing activities 4,075,261 4,398,599 Effect of currency translation ( 347,188 ) ( 121,016 ) Net increase/(decrease) in cash, cash equivalents, and restricted cash 926,649 ( 929,170 ) Cash, cash equivalents, and restricted cash at beginning of period 5,420,392 6,349,562 Cash, cash equivalents, and restricted cash at end of period $ 6,347,041 $ 5,420,392 The accompanying notes are an integral part of these consolidated financial statements. F- 10 Cemtrex Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS Balance Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash September 30, 2025 September 30, 2024 Cash and cash equivalents $ 4,974,303 $ 3,897,511 Restricted cash 1,372,738 1,522,881 Total cash, cash equivalents, and restricted cash $ 6,347,041 $ 5,420,392 For the year ended September 30, Supplemental Disclosure of Cash Flow Information: 2025 2024 Cash paid during the period for interest $ 1,018,763 $ 907,307 Cash paid during the period for income taxes, net of refunds $ 792,628 $ 196,727 Supplemental Schedule of Non-Cash Investing and Financing Activities Shares issued to pay for services $ - $ 169,000 Shares issued to pay notes payable $ 5,236,027 $ - Financing of fixed asset purchase $ - $ 28,331 Noncash recognition of new leases $ 1,011,604 $ 474,874 Noncash dividends $ 252 $ 236 Series A Warrant Exercises $ 21,515,769 $ 1,060,113 Series B Warrant Exercises $ 4,409,605 $ - The accompanying notes are an integral part of these consolidated financial statements. F- 11 Cemtrex Inc. and Subsidiaries NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 – ORGANIZATION Cemtrex was incorporated in 1998, in the state of Delaware and has evolved through strategic acquisitions and internal growth into a leading multi-industry technology company. The Company has expanded in a wide range of sectors, including smart technologies, virtual and augmented realities, industrial solutions, and intelligent security systems. Unless the context requires otherwise, all references to “we”, “our”, “us”, “Company”, “registrant”, “Cemtrex” or “management” refer to Cemtrex, Inc. and its subsidiaries. Common Stock Reverse Stock Split On 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. Nasdaq Notices for Listing Deficiencies On June 14, 2024, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that, because the closing bid price for the Company’s common stock listed on Nasdaq was below $ 1.00 for 30 consecutive trading days, the Company no longer meets 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 notification letter also disclosed that in the event the Company 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. Although 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. 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”). On 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. On 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. On 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”). F- 12 Cemtrex Inc. and Subsidiaries On 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. On 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. Going Concern Considerations The accompanying consolidated financial statements of the Company have been prepared assuming the Company will continue as a going concern and in accordance with generally accepted accounting principles in the United States of America. The going concern basis of presentation 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. Pursuant to the requirements of the ASC 205, management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date these financial statements are issued. This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company has incurred substantial losses of $ 28,112,368 and $ 7,229,491 for fiscal years 2025 and 2024, respectively, and has debt obligations over the next fiscal year of $ 12,101,593 and working capital of $ 5,184,339 , that raise substantial doubt with respect to the Company’s ability to continue as a going concern. While our working capital and current debt indicate a substantial doubt regarding the Company’s ability to continue as a going concern, the Company has historically, from time to time, satisfied and may continue to satisfy certain short-term liabilities through the issuance of common stock, thus reducing our cash requirement to meet our operating needs. The Company has $ 4,974,303 in cash as of September 30, 2025. Additionally, the Company has (i) secured a line of credit for its Vicon brand to fund operations, which as of September 30, 2025, has available capacity of $ 1,564,179 , (ii) continually reevaluate our pricing model on our Vicon brand to improve margins on those products and introducing new innovative products to grow revenues, (iii) raised $ 12,478,957 in net proceeds through our May 2024 equity financing, raised another $ 5,657,264 subsequent to the balance sheet date and anticipate an additional $ 2.4 million when the Series B warrants are exercised.; (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. F- 13 Cemtrex Inc. and Subsidiaries 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 do not have adequate cash to meet our short or long-term needs. The consolidated financial statements do not include any adjustments relating to this uncertainty. NOTE 2 – BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES The management of the Company is responsible for the selection and use of appropriate accounting policies and the appropriateness of accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical accounting policies and practices are disclosed below as required by generally accepted accounting principles. Basis of Presentation The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Fiscal Year-End The Company elected September 30 as its fiscal year-end date. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Such estimates include, but are not limited to, provisions for credit losses, net realizable value of inventory, warranty obligations, income tax accruals, deferred tax valuation, valuation of warrant liabilities, and assessments of the recoverability of the Company’s long-lived assets. Actual results could differ from those estimates. Principles of Consolidation The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Vicon Security Technologies Pvt Ltd. (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. Carrying Value, Recoverability, and Impairment of Long-Lived Assets The Company’s long-lived assets, which include property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company assesses the recoverability of its long-lived assets by comparing the projected undiscounted net cash flows associated with the related long-lived asset or group of long-lived assets over their remaining estimated useful lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over the fair value of those assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. When long-lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated over the newly determined remaining estimated useful lives. The impairment charges, if any, are included in operating expenses in the accompanying Consolidated Statements of Operations. F- 14 Cemtrex Inc. and Subsidiaries Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. Trade Receivables and Allowance for Current Expected Credit Losses Trade receivables are recorded at the invoiced amount, net of an allowance for current expected credit losses. The Company performs on-going credit evaluations of its customers and adjusts credit limits based upon payment history and the customer’s current credit worthiness, as determined by the review of their current credit information; and determines the allowance based on 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. The Company estimates credit losses associated with our accounts receivable portfolio segment using an expected credit loss model, which utilizes an aging schedule methodology based on historical information and adjusted for asset-specific considerations, current economic conditions, and reasonable and supportable forecasts. The Company reserved $ 152,415 and $ 155,918 within its allowance for credit losses at September 30, 2025, and 2024, respectively. The Company does no t have any off-balance-sheet credit exposure to its customers at September 30, 2025, or 2024. Inventory and Cost of Goods Sold The Company values inventory, consisting of finished goods, at the lower of cost or net realizable value. Cost is determined on the average cost method. The Company reduces inventory for the diminution of value, resulting from product obsolescence, damage or other issues affecting marketability, equal to the difference between the cost of the inventory and its estimated market value. Factors utilized in the determination of estimated market value include (i) current sales data and historical return rates, (ii) estimates of future demand, and (iii) competitive pricing pressures. The Company classifies inventory markdowns in the income statement as a component of cost of goods sold. These markdowns are estimates, which could vary significantly from actual requirements if future economic conditions, customer demand, or competition differ from expectations. There was $ 1,034,798 and $ 1,044,530 in inventory obsolescence reserve at September 30, 2025, and 2024, respectively. Property and Equipment Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation of property and equipment is computed by the straight-line method over the estimated useful lives of the respective assets, shown in the table below. SCHEDULE OF PROPERTY PLANT AND EQUIPMENT Estimated Useful Life (Years) Building 30 Furniture and office equipment 3 - 5 Computer software 7 - 10 Machinery and equipment 7 Upon 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. F- 15 Cemtrex Inc. and Subsidiaries Digital assets The 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. Principal Market and Fair Value Determination To 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. The 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: First, the Company determines which Digital Asset Markets for the relevant digital asset are accessible to the Company. Second, 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. Third, 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. The 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. The 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 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. F- 16 Cemtrex Inc. 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 testing. Leases The Company accounts for leases in accordance with Accounting Standards Codification 842, Leases (“ASC 842”). ASC 842 requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The Company also made the accounting policy decision not to recognize lease assets and liabilities for leases with a term of 12 months or less. Warrants The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480 (Topic 480, Distinguishing Liabilities from Equity) and ASC 815 (Topic 815, Derivatives and Hedging). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to our own common shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of our control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as a liability at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss in the Company’s Consolidated Statements of Operations. Related Parties The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a. the nature of the relationship(s) involved b. description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c. the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d. amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. The Company applies the CECL model on its related party assets and applies an allowance when necessary. F- 17 Cemtrex Inc. and Subsidiaries Commitment and Contingencies The Company follows topic Accounting Standards Codification (“ASC”) Topic 450-20, Contingencies , to report accounting for contingencies. Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time, that these matters will have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. Revenue Recognition The Company accounts for revenue in accordance with Accounting 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. The Company generally permits returns of product or repaired equipment due to defects; however, returns are historically insignificant. Billing terms vary by customer and product but generally do not exceed 90 days. In accordance with the authoritative guidance issued by the FASB on revenue recognition, the Company recognizes revenue from cost reimbursable contracts based on the services provided, typically represented by man-hours worked, and is measured by reference to agreed charge-out rates or to the estimated total contract revenue. Revenue from long-term fixed price contracts is recognized using the percentage-of-completion method, measured by reference to physical completion or the ratio of costs incurred to total estimated contract costs. If the outcome of a contract cannot be estimated reliably, as may be the case in the initial stages of completion of the contract, revenue is recognized only to the extent of the costs incurred that are expected to be recoverable. If a contract is expected to be loss-making, the expected amount of the loss is recognized immediately in the income statement. Revenue from short-term contracts is recognized when delivery has occurred, and collection of the resulting receivable is deemed probable. Timing of revenue recognition may differ from the timing of invoicing to customers. The 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 $ 1,866,014 , $ 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. The 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, and 2023, respectively. These amounts are short-term and are expected to be recognized over the next 12 months. F- 18 Cemtrex Inc. and Subsidiaries Contracts The Company’s industrial services segment’s revenue is derived from contracts with customers. These contracts fall into two categories, “Fixed Price” and “Time and Material Price” contracts. The Company determines the appropriate accounting treatment for each contract at its inception. Generally, contracts have a period from six months to two years. The Company accounts for a contract when: (i) it has approval and commitment from both parties, (ii) the rights of the parties are identified, (iii) payment terms are identified, (iv) the contract has commercial substance, and (v) collectability of consideration is probable. The Company considers the start of a project to be when the above criteria have been met and it has written authorization from the customer to proceed. Fixed price contracts The Company’s revenue from fixed price contracts is recognized on the percentage-of-completion method, measured by the percentage of costs incurred to estimated total costs for each contract. When the job is started and in process, all actual costs incurred (labor and materials) are processed and reconciled at month end. The percentage of completion and revenue earned is calculated at month end. Billings are created based on contract criteria agreed upon and reconciled to determine if any costs in excess of billing or billings in excess of costs exist. Changes in job performance, job conditions, estimated contract costs and profitability, and final contract settlements may result in revisions to costs and income. The effects of these revisions are recognized in the period in which the revisions are determined. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. This measurement and comparison process requires updates to the estimate of total costs to complete the contract, and these updates may include subjective assessments and judgments. Time and material price contracts Revenue from time and material price contracts is recognized based on costs incurred and projected markup on costs. Revenue from these contracts will vary based on actual labor, materials and overhead costs charged to the job and the negotiated billing rates. Contracts are initiated by customers or through bids if with a municipality. Any materials used and time spent within the shop on the job is assigned to the appropriate job and reconciliated monthly. Management bills the customer and records the revenue earned from contract. Depending on the contract terms, billings could be based on certain milestones stipulated in the contract. If this is the case, unbilled revenue is recorded at month end based on time and materials incurred and markup. Performance Obligations Generally, the Company’s contracts contain one performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account. The Company’s performance of the contracts with customers typically provides a significant service of integrating a complex set of tasks and components into a single project or capability (even if that single project results in the delivery of multiple units), and as such, the entire contract and/or purchase order is accounted for as one performance obligation. The transaction price is allocated to the performance obligation and recognized as revenue when, or as, the performance obligation is satisfied with the continuous transfer of control to the customer. Less commonly, a contract may be considered to have multiple performance obligations even when they are part of a single contract. For contracts with multiple performance obligations, the Company allocates the transaction price to each performance obligation using the best estimate of the standalone selling price of each distinct good or service in the contract. The Company recognizes revenue over time for the majority of the services it performs as (i) control continuously transfers to the customer as work progresses at a project location controlled by the customer and (ii) the Company has the right to bill the customer as costs are incurred. F- 19 Cemtrex Inc. and Subsidiaries The following table illustrates the approximate disaggregation of the Company’s revenue based off timing of revenue recognition for years ended September 30, 2025, and 2024. SCHEDULE OF DISAGGREGATION OF THE COMPANY REVENUE RECOGNITION For the year ended September 30, 2025 September 30, 2024 Over time 53 % 57 % Point-in-time 47 % 43 % Warranties The Company provides for the estimated cost of product warranties at the time revenue is recognized. While the Company engages in product quality programs and processes, including monitoring and evaluating the quality of its component suppliers, its warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. Should actual product failure rates, material usage or service delivery costs differ from its estimates, revisions to the estimated warranty liability may be required. Income Tax Provision The Company accounts for income taxes under ASC 740-10, (“Income Taxes”) , which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Consolidated Statements of Operations and Comprehensive Loss in the period that includes the enactment date. The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying Consolidated Balance Sheets, as well as tax credit carrybacks and carryforwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its Consolidated Balance Sheets and provides valuation allowances as management deems necessary. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions including the United States, India, and The United Kingdom, and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. Uncertain Tax Positions For the years ended September 30, 2025, and 2024, the Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits. The Company will record any interest and/or penalties arising from uncertain tax provisions when they are likely to occur and reasonably estimable. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty (50) percent likelihood of being realized upon ultimate settlement. The Company will accrue interest and penalties on income taxes when there is a likelihood that they will occur and can be reasonably estimated. Accounting for Share-Based Compensation The Company follows ASC 718 (“Share-Based Payment”), which requires that all share-based payments to employees, including stock options, stock appreciation rights (SARs) and common stock share awards, be recognized as compensation expense in the consolidated financial statements based on their fair values and over the requisite service period. F- 20 Cemtrex Inc. and Subsidiaries The fair value for options granted was determined at the date of grant using a Black-Scholes valuation model and the straight-line attribution approach using the following weighted average assumptions: The risk-free interest rate used in the Black-Scholes valuation method is based on the implied yield currently available in U.S. Treasury securities at maturity with an equivalent term. Other than a one-time dividend paid in fiscal year 2017, the Company never declared or paid any cash dividends and does not currently expect to do so in the future. Expected volatility is based on the annualized daily historical volatility of the Company’s stock over a representative period. The weighted-average expected life represents the period over which stock-based awards are expected to be outstanding and was determined based on a number of factors, including historical weighted average and projected holding periods for the remaining unexercised shares, the contractual terms of the Company’s stock-based awards, vesting schedules and expectations of future employee behavior. Net Loss per Common Share Basic net income (loss) per common share is computed by dividing net income (loss) less the fair market value of dividends declared by the weighted average number of shares of common stock outstanding during the period. Diluted net income per common share is computed by dividing net income less the fair market value of dividends declared by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants. As of September 30, 2025, and 2024, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive. SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT For the year ended September 30, 2025 September 30, 2024 Options 7 7 Warrants 1,519,782 13,529,410 For the years ended September 30, 2025, and 2024 loss per share basic and diluted for continuing operations are calculated as follows. SCHEDULE OF LOSS PER SHARE BASIC AND DILUTED FOR CONTINUING OPERATIONS For the year ended September 30, 2025 2024 Loss from Continuing operations $ ( 28,048,968 ) $ ( 7,678,629 ) Less loss in noncontrolling interest ( 180,152 ) ( 406,014 ) Preferred stock dividends 51,449 67,788 Net loss applicable to common shareholders ( 27,920,265 ) ( 7,340,403 ) Weighted Average Number of Shares-Basic & Diluted 132,396 27,240 Loss per share - Basic & Diluted - Continuing Operations $ ( 210.88 ) $ ( 269.47 ) In 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. Credit Losses 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. 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. F- 21 Cemtrex Inc. and Subsidiaries The following table illustrates the current expected credit losses activity for the year ended September 30, 2025. SCHEDULE OF CURRENT EXPECTED CREDIT LOSSES Trade receivables, net Contract assets, net Royalties receivable, net - related party As of September 30, 2024 $ 155,918 $ 15,985 $ 10,000 Provision - - 216,399 Recovery ( 3,503 ) ( 6,281 ) - Write-off - - ( 60,628 ) As of September 30, 2025 $ 152,415 $ 9,704 $ 165,771 The 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. Foreign Currency Translation (Loss)/Gain and Comprehensive Income Loss In countries in which the Company operates, and the functional currency is other than the U.S. dollar, assets and liabilities are translated using published exchange rates in effect at the consolidated balance sheet date. Revenues and expenses and cash flows are translated using an approximate weighted average exchange rate for the period. Resulting translation adjustments are recorded as a component of accumulated other comprehensive loss on the accompanying consolidated balance sheet. For the years ending September 30, 2025, and September 30, 2024, comprehensive loss includes a loss of $ 357,957 and $ 127,409 , respectively, which were entirely from foreign currency translation. As of and for the year ended September 30, 2025, and 2024, the Company used the following exchange rates. SCHEDULE OF FOREIGN CURRENCY EXCHANGE RATE Approximate weighted Approximate weighted average exchange rate average exchange rate Exchange rate at For the three months ended Exchange rate at For the year ended Currency September 30, 2025 September 30, 2025 September 30, 2024 September 30, 2024 Indian Rupee 0.011 0.012 0.012 0.012 Great Britain Pound 1.344 1.306 1.339 1.268 Reclassifications A 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 “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. SCHEDULE OF RECLASSIFICATIONS September 30, 2024 CONSOLIDATED BALANCE SHEETS As previously reported Reclassification As revised Accrued expenses $ 2,034,352 $ ( 208,433 ) $ 1,825,919 Accrued payable on inventory in transit $ - $ 208,433 $ 208,433 F- 22 Cemtrex Inc. and Subsidiaries Concentrations and cash and credit risks For 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. Recently Adopted Accounting Pronouncements On 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 period. ASU 2023-08 is effective for annual and interim reporting periods beginning after December 15, 2024. Early adoption is permitted 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 assets. Recently Issued Accounting Pronouncements Not Yet Effective In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” which requires public entities to disclose consistent categories and greater disaggregation of information in the rate reconciliation and for income taxes paid. It also includes certain other amendments to improve the effectiveness of income tax disclosures. The guidance is effective for financial statements issued for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is required to adopt this standard prospectively in fiscal year 2026 for the annual reporting period ending September 30, 2026. The Company is currently in the process of evaluating the impact of adoption on the consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, “Income Statement (Topic 220): Reporting Comprehensive Income - Expense Disaggregation Disclosures, Disaggregation of Income Statement Expenses”, that requires public companies to disclose, in interim and reporting periods, additional information about certain expenses in the financial statements. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted and is effective on either a prospective basis or retrospective basis. The Company is currently assessing the potential impacts of adoption on the consolidated financial statements. In November 2024, the FASB issued ASU 2024-04, “Debt with Conversion and Other Options (Subtopic 470-20), which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. ASU 2024-04 is effective for annual periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities that have adopted the amendments in Update 2020-06. Adoption can be on a prospective or retrospective basis. The Company is currently in the process of evaluating the impact of adoption on the consolidated financial statements. In 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. Early 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 disclosures. F- 23 Cemtrex Inc. and Subsidiaries Cemtrex Inc. and Subsidiaries On 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. In 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. Early adoption is prohibited. The Company does not anticipate that the ASU will have a material effect on its financial statements and related disclosures. The Company does not believe that any other recently issued but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements. NOTE 3 – SEGMENT AND GEOGRAPHIC INFORMATION The Company’s reporting segments consist of Security and Industrial Services. Additionally, the Company’s operational structure also reports unallocated corporate expenses. All intersegment transactions have been eliminated and values are presented net of eliminations. Operating segments The Company determines its reporting units in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 280, Segment Reporting. The Company evaluates a reporting unit by first identifying its operating segments under ASC 280. 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. Unallocated 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 Cemtrex’s Security segment operates under the Vicon brand that delivers innovative software and hardware technologies: Vicon Industries, a majority owned subsidiary, provides end-to-end security solutions to meet the toughest corporate, industrial, and governmental security challenges. Vicon’s products include browser-based video monitoring systems and analytics-based recognition systems, cameras, servers, and access control systems for every aspect of security and surveillance in industrial and commercial facilities, federal prisons, hospitals, universities, schools, and federal and state government offices. Vicon provides innovative, mission critical security and video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms. Industrial Services Cemtrex’s Industrial Services segment operates through the brand, Advanced Industrial Services (“AIS”), that offers single-source expertise and services for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers. We install high precision equipment in a wide variety of industrial markets like automotive, printing and graphics, industrial automation, packaging, and chemicals, among others. We are a leading provider of reliability-driven maintenance and contracting solutions for the machinery, packaging, printing, chemical, and other manufacturing markets. The focus is on customers seeking to achieve greater asset utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds, maintenance, specialty welding services, and high-quality scaffolding. F- 24 Cemtrex Inc. and Subsidiaries The following tables summarize the Company’s segment information. SCHEDULE OF SEGMENT INFORMATION Year ended September 30, 2025 Year ended September 30, 2024 Reportable Segments Reportable Segments Security Industrial Services Corporate Consolidated Security Industrial Services Corporate Consolidated External revenues $ 38,398,792 $ 38,079,529 $ 9,767 $ 76,488,088 $ 32,021,899 $ 34,841,985 $ - $ 66,863,884 Cost of revenues 19,313,038 24,886,524 - 44,199,562 15,854,560 23,531,120 - 39,385,680 Gross profit $ 19,085,754 $ 13,193,005 $ 9,767 $ 32,288,526 $ 16,167,339 $ 11,310,865 $ - $ 27,478,204 Operating expenses General and administrative 15,204,492 8,217,034 4,766,959 28,188,485 16,073,558 7,074,828 4,436,787 27,585,173 Depreciation and amortization 300,276 936,799 - 1,237,075 329,294 945,552 - 1,274,846 Research and development 2,353,140 - - 2,353,140 3,357,455 - - 3,357,455 Goodwill Impairment - - - - 530,475 - - 530,475 Operating income/(loss) $ 1,227,846 $ 4,039,172 $ ( 4,757,192 ) $ 509,826 $ ( 4,123,443 ) $ 3,290,485 $ ( 4,436,787 ) $ ( 5,269,745 ) Other expense, net $ ( 364,994 ) $ ( 184,807 ) $ ( 27,274,113 ) $ ( 27,823,914 ) $ ( 492,330 ) $ ( 295,157 ) $ ( 1,419,117 ) $ ( 2,206,604 ) Unallocated 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 losses. September 30, 2025 September 30, 2024 Identifiable Assets Security $ 17,334,365 $ 17,253,328 Industrial Services 25,865,577 24,576,055 Corporate 4,588,334 2,286,075 Total Assets $ 47,788,276 $ 44,115,458 The Company generates revenue from product sales and services from its subsidiaries located in the United States, the United Kingdom, and India. Revenue and long-lived asset information for the Company is as follows. SCHEDULE OF REVENUE FROM PRODUCT SALES AND SERVICES FROM ITS SUBSIDIARIES For the year ended Revenues September 30, 2025 September 30, 2024 United States $ 71,309,168 $ 62,921,388 United Kingdom 4,740,871 3,251,130 India 438,049 691,366 $ 76,488,088 $ 66,863,884 Long-lived Assets September 30, 2025 September 30, 2024 United States $ 11,370,352 $ 10,545,327 United Kingdom 71,180 218,346 India 214,431 303,283 $ 11,655,963 $ 11,066,956 F- 25 Cemtrex Inc. and Subsidiaries NOTE 4 – FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy is applied to prioritize the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under the guidance for fair value measurements are described below: Level 1 — Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Our Level 1 assets include cash equivalents, banker’s acceptances, trading securities investments, and investment funds. The Company measures trading securities investments and investment funds at quoted market prices as they are traded in an active market with sufficient volume and frequency of transactions. Level 2 — Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified contractual term, a Level 2 input must be observable for substantially the full term of the asset or liability. Level 3 — Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. Level 3 assets and liabilities include cost method investments, goodwill, intangible assets, and property, plant, and equipment, which are measured at fair value using a discounted cash flow approach when they are impaired. Quantitative information for Level 3 assets and liabilities reviewed at each reporting period includes indicators of significant deterioration in the earnings performance, credit rating, asset quality, business prospects of the investee, and financial indicators of the investee’s ability to continue as a going concern. The Company’s fair value assets and liabilities for the years ended September 30, 2025, and 2024, are as follows. SCHEDULE OF FAIR VALUE OF LIABILITIES Quoted Prices Significant in Active Other Significant Balance Markets for Observable Unobservable as of Identical Assets Inputs Inputs September 30, (Level 1) (Level 2) (Level 3) 2025 Assets Digital assets - SOL 1,158,238 - - 1,158,238 Liabilities Warrant liabilities 833,854 7,901,343 - 8,735,197 Quoted Prices Significant in Active Other Significant Balance Markets for Observable Unobservable as of Identical Assets Inputs Inputs September 30, (Level 1) (Level 2) (Level 3) 2024 Liabilities Warrant liabilities $ 4,160,658 $ 1,038,778 $ - $ 5,199,436 Digital Assets – SOL On 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. Digital 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. The 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. The staking process uses incentives and penalties governed by computer-based rules to encourage honest participation in the network. Stakers 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. Staking 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. F- 26 Cemtrex Inc. and Subsidiaries The Company’s digital assets for the year ended September 30, 2025, is as follows. SCHEDULE OF DIGITAL ASSETS Units Cost per Unit Cost Basis Fair Value Balance, September 30, 2025 SOL 5,549 $ 181.70 $ 1,008,229 $ 1,158,238 The following table is a summary of our digital assets for the year ended September 30, 2025. For the year ended September 30, 2025 Fair Value, September 30, 2024 $ - Cash purchase 998,462 Receipt of SOL from staking 12,522 Non-cash transaction fees ( 2,755 ) Unrealized gain 150,009 Fair Value, September 30, 2025 $ 1,158,238 Warrant Liabilities The 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. At September 30, 2025, and 2024, the following inputs were used in the Black-Scholes model. SCHEDULE OF FAIR VALUE INPUTS USED IN BLACK-SCHOLES MODEL September 30, 2025 September 30, 2024 Expected term 3.59 Years 4.59 Years Risk-free interest rate 3.61 % 3.60 % Expected volatility 178.98 % 134.00 % Expected dividend yield 0 % 0 % A summary of the warrant liabilities activity for the years ended September 30, 2025, and 2024, is as follows. SCHEDULE OF WARRANT LIABILITIES ACTIVITY Series A Warrants Series B Warrants Prefunded Warrants Total Warrant Liabilities at September 30, 2023 $ - $ - $ - $ - Warrants Issued 11,242,940 2,942,711 3,105,170 17,290,821 Warrants Exercised ( 1,060,113 ) - ( 3,190,320 ) ( 4,250,433 ) Fair market revaluation ( 6,022,169 ) ( 1,903,933 ) 85,150 ( 7,840,952 ) Warrant Liabilities at September 30, 2024 $ 4,160,658 $ 1,038,778 $ - $ 5,199,436 Warrants Issued - - - - Warrants Exercised ( 5,669,909 ) ( 1,727,742 ) - ( 7,397,651 ) Fair market revaluation 2,343,105 8,590,307 - 10,933,412 Warrant Liabilities at September 30, 2025 $ 833,854 $ 7,901,343 $ - $ 8,735,197 NOTE 5 – RESTRICTED CASH A subsidiary of the Company participates in a consortium in order to self-insure group care coverage for its employees. The plan is administrated by Benecon Group and the Company makes monthly deposits in a trust account to cover medical claims and any administrative costs associated with the plan. These funds, as required by the plan are restricted in nature and amounted to $ 839,215 and $ 1,030,606 as of September 30, 2025, and 2024, respectively. 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. NOTE 6 – TRADE RECEIVABLES, NET Trade receivables, net consists of the following. SCHEDULE OF TRADE RECEIVABLES, NET September 30, 2025 September 30, 2024 Trade receivables $ 13,285,839 $ 11,315,594 Allowance for credit losses ( 152,415 ) ( 155,918 ) Accounts receivables, net, total $ 13,133,424 $ 11,159,676 Trade receivables, net were $ 9,209,695 at September 30, 2023. Trade receivables include amounts due for shipped products and services rendered. Allowance for credit losses include estimated losses resulting from the application of the CECL method to our trade receivables. F- 27 Cemtrex Inc. and Subsidiaries NOTE 7 – PREPAID AND OTHER CURRENT ASSETS Prepaid and other current assets consist of the following. SUMMARY OF PREPAID EXPENSES AND OTHER CURRENT ASSETS September 30, 2025 September 30, 2024 Prepaid expenses $ 1,327,463 $ 547,914 Prepaid inventory 81,820 301,605 Deferred costs 132,434 71,359 Short-term investments 14,715 13,871 Prepaid income taxes - 462,997 VAT and GST tax receivable - 58,941 Prepaid expenses and other current assets total $ 1,556,432 $ 1,456,687 NOTE 8 – INVENTORY, NET Inventory, net of reserves, consists of the following. SCHEDULE OF INVENTORY, NET September 30, 2025 September 30, 2024 Raw materials $ 609,304 $ 421,557 Work in progress 364,907 272,910 Finished goods 5,610,733 6,294,062 Inventory, net 6,584,944 6,988,529 NOTE 9 – PROPERTY AND EQUIPMENT Property and equipment are summarized as follows. SUMMARY OF PROPERTY AND EQUIPMENT September 30, 2025 September 30, 2024 Land $ 945,279 $ 945,279 Building and leasehold improvements 4,482,978 4,388,556 Furniture and office equipment 625,995 600,186 Computers and software 2,685,331 2,683,512 Machinery and equipment 13,927,502 12,228,325 Property and equipment, gross 22,667,085 20,845,858 Less: Accumulated depreciation ( 13,015,089 ) ( 11,712,280 ) Property and equipment, net $ 9,651,996 $ 9,133,578 The 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. F- 28 Cemtrex Inc. and Subsidiaries NOTE 10 – GOODWILL Changes in the carrying amount of goodwill, by segment, are as follows. SCHEDULE OF GOODWILL BY SEGMENT Security Industrial Services Consolidated Balance at September 30, 2023 $ 530,475 $ 3,851,416 $ 4,381,891 Acquisition measurement period adjustment - ( 143,069 ) ( 143,069 ) Impairment ( 530,475 ) - ( 530,475 ) Balance at September 30, 2024 $ - $ 3,708,347 $ 3,708,347 Impairment /adjustments - - - Balance at September 30, 2025 $ - $ 3,708,347 $ 3,708,347 For the year ended September 30, 2024, $ 530,475 of impairment of the Company’s goodwill was recorded. As of September 30, 2025, and September 30, 2024, accumulated impairment losses of $ 3,846,475 related to the Security segment have been recorded. NOTE 11 - OTHER ASSETS On November 13, 2020, and January 19, 2022, Cemtrex made $ 500,000 investments, on July 18, 2023, and October 5, 2023, made additional $ 100,000 investments, and on October 17, 2024, and November 18, 2024, made additional $ 50,000 investments on each respective 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. MasterpieceVR is a software company that is developing software for content creation using virtual reality. The investment is included in other assets in the accompanying consolidated balance sheet and the Company accounts for this investment and recorded at cost. No impairment has been recorded for the years ended September 30, 2025, and 2024. Other assts consists of the following. SCHEDULE OF OTHER ASSETS September 30, 2025 September 30, 2024 Rental deposits $ 262,201 $ 194,796 Investment in Masterpiece VR 1,300,000 1,200,000 Other deposits 63,930 350,845 Demonstration equipment supplied to resellers 441,624 441,624 Other assets total $ 2,067,755 $ 2,187,265 NOTE 12 – ACCRUED EXPENSES Accrued expenses consist of the following. SCHEDULE OF ACCRUED EXPENSES September 30, 2025 September 30, 2024 Accrued expenses $ 442,344 $ 352,938 Accrued payroll and payroll taxes 1,558,475 1,250,279 Accrued warranty 222,702 222,702 Accrued expenses total $ 2,223,521 $ 1,825,919 F- 29 Cemtrex Inc. and Subsidiaries NOTE 13 – DEFERRED REVENUE The Company’s deferred revenue as of and for the years ended September 30, 2025, and 2024, are as follows. SCHEDULE OF DEFERRED REVENUE For the year ended September 30, 2025 September 30, 2024 Deferred revenue at beginning of period $ 1,955,635 $ 2,311,334 Net additions: Deferred software revenues 2,070,528 2,321,630 Recognized as revenue: Deferred software revenues ( 2,160,149 ) ( 2,677,329 ) Deferred revenue at end of period 1,866,014 1,955,635 Less: current portion 1,383,036 1,297,616 Long-term deferred revenue at end of period $ 482,978 $ 658,019 For the years ended September 30, 2025, and 2024, the Company recognized revenue of $ 1,335,394 , and $ 1,555,423 , respectively, that was previously included in the beginning balance of deferred revenues. NOTE 14 - CONTRACT ASSETS AND LIABILITES Project contracts typically provide for a schedule of billings on percentage of completion of specific tasks inherent in the fulfillment of the Company’s performance obligation(s). The schedules for such billings usually do not precisely match the schedule on which costs are incurred. As a result, contract revenue recognized in the statements of operations can and usually does differ from amounts that can be billed to the customer at any point during the contract. Amounts by which cumulative contract revenue recognized on a contract as of a given date exceeds cumulative billings and unbilled receivables to the customer under the contract are reflected as a current asset in the balance sheets under the caption “Contract assets.” Amounts by which cumulative billings to the customer under a contract as of a given date exceed cumulative contract revenue recognized are reflected as a current liability in the balance sheets under the caption “Contract liabilities.” Conditional retainage represents the portion of the contract price withheld until the work is substantially complete for assurance of the Company’s obligations to complete the job. The following is a summary of the Company’s uncompleted contracts. SCHEDULE OF CONTRACT ASSETS AND LIABILITIES September 30, 2025 September 30, 2024 Costs incurred on uncompleted contracts $ 10,344,923 $ 12,724,334 Estimated gross profit 4,025,531 3,006,692 14,370,454 15,731,026 Applicable billings to date ( 15,045,345 ) ( 16,000,023 ) Net billing in excess of costs $ ( 674,891 ) $ ( 268,997 ) F- 30 Cemtrex Inc. and Subsidiaries For the years ended September 30, 2025, and 2024, the Company recognized revenue of $ 1,148,038 and $ 905,319 , respectively, that was previously included in the beginning balance of contract liabilities. SUMMARY OF CONTRACT ASSETS AND CONTACT LIABILITIES For year ended September 30, 2025 September 30, 2024 Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts Contract asset, beginning balance $ 985,207 $ 1,739,201 Changes in revenue billed, contract price or cost estimates ( 5,043 ) ( 753,994 ) Contract asset, net, ending balance $ 980,164 $ 985,207 Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts Contract liability, beginning balance ( 1,254,204 ) $ ( 980,319 ) Changes in revenue billed, contract price or cost estimates ( 400,851 ) ( 273,885 ) Contract liability, ending balance $ ( 1,655,055 ) $ ( 1,254,204 ) Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts Net billings in excess of costs, beginning balance $ ( 268,997 ) $ 758,882 Changes in revenue billed, contract price or cost estimates $ ( 405,894 ) ( 1,027,879 ) Net billings in excess of costs, ending balance $ ( 674,891 ) $ ( 268,997 ) NOTE 15 – LEASES The Company is party to contracts where we lease property from others under contracts classified as operating leases. The Company primarily leases office and operating facilities, vehicles, and office equipment. The weighted average remaining term of our operating leases was approximately 2.52 years at September 30, 2025, and 3.3 years at September 30, 2024. The weighted average discount rate used to measure 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. The 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. A reconciliation of undiscounted cash flows to operating lease liabilities recognized in the Consolidated Balance Sheet at September 30, 2025, is set forth below. SCHEDULE OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO OPERATING LEASE LIABILITIES Years ending September 30, Operating Leases 2026 1,030,742 2027 607,015 2028 347,775 2029 211,805 2030 310,075 Undiscounted lease payments 2,507,412 Amount representing interest ( 435,800 ) Discounted lease payments 2,071,612 Less short-term operating lease liabilities 918,391 Long-term operating lease liabilities $ 1,153,221 Lease costs for the years ended September 30, 2025, and 2024 are set forth below. SCHEDULE OF LEASE COSTS For the year ended September 30, 2025 2024 Operating lease costs 950,011 831,536 Short-term lease costs 163,429 66,196 Total lease cost $ 1,113,440 $ 897,732 F- 31 Cemtrex Inc. and Subsidiaries NOTE 16 – LINES OF CREDIT AND LONG-TERM LIABILITIES Revolving line of credit On October 5, 2023, the Company obtained a revolving line of credit in the amount of $ 5,000,000 from Pathward, N.A. The interest rate will be a rate which is equal to three percentage points ( 3 %) in excess of that rate shown in the Wall Street Journal as the prime rate (the “Effective Rate”) and matures twenty-four 24 months from the closing date. This loan is secured by the Company’s eligible accounts receivable and eligible finished goods inventory. The Company’s ability to borrow against the line of credit is limited by the value of the eligible assets. As of September 30, 2024, the Company had enough eligible assets to access the full credit line. The Company was in compliance with all loan covenants as of September 30, 2024. The funds were used to pay the NIL Funding term loan and will fund operations of the Vicon entity. As of September 30, 2025, this loan had a balance of $ 3,176,096 , with no remaining unamortized loan origination fees. There were $ 1,564,179 of available funds as of September 30, 2025. Standstill Agreement On August 31, 2023, the Company and Streeterville Capital, LLC (“Streeterville”) entered into a standstill agreement for the two notes held by Streeterville Capital, LLC. The terms of this agreement are the earlier of (a) the date that is ninety (90) days from the Effective Date, and (b) the date that the Company completes an equity offering on either Form S-1 or Form S-3 (the “Standstill Period”), Streeterville Capital, LLC will not seek to redeem any portion of the Notes, and (c) the Company agrees to prepay to Lender fifty percent ( 50 %) of the net proceeds received by Borrower in connection with all equity financings until such time as Borrower has raised at least $ 5,000,000 in aggregate net proceeds. On April 30, 2024, the Company entered into a Standstill Agreement with Streeterville Capital, LLC (“Streeterville”) in which Streeterville agreed not to seek to redeem any portion of its two outstanding notes with the Company for a period of one year expiring on April 30, 2025, with $ 239,813 classified as short-term , and in exchange, the Company agreed to pay to Streeterville the greater of $ 4,000,000 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. To date, the Company has paid Streeterville $ 4,588,897 under this agreement. On 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. Loans Payable to Bank On September 5, 2024, the Company acquired a loan from Fulton Bank in the amount of $ 312,000 in order to fund new equipment for Advanced Industrial Services, Inc. This loan carries interest of SOFR plus 2.37 % per annum. This loan carries loan covenants which the Company was in compliance with as of September 30, 2025. This loan is secured by the assets of the Company. On 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 . F- 32 Cemtrex Inc. and Subsidiaries SCHEDULE OF LINES OF CREDIT AND AND LONG TERM LIABILITIES Interest Rate Maturity September 30,2025 September 30, 2024 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 % ( 6.61 % as of September 30, 2025, and 7.33 % as of September 30, 2024). 1/31/2025 - 28,302 Fulton Bank - $ 312,000 fund equipment for AIS. The Company was in compliance with loan covenants as of September 30, 2025. This loan is secured by certain assets of the Company. SOFR plus 2.37 % ( 6.61 % as of September 30, 2025, and 7.33 % as of September 30, 2024). 9/30/2029 257,704 312,000 Fulton Bank mortgage $ 2,476,000 . The Company was in compliance with loan covenants as of September 30, 2025. This loan is secured by the underlying asset. SOFR plus 2.62 % ( 6.86 % on September 30, 2025, and 7.58 % on September 30, 2024). 1/28/2040 2,034,048 2,113,337 Fulton Bank (HEISEY) - $ 1,200,000 mortgage loan; requires monthly principal and interest payments through August 1, 2043, with a final payment of remaining principal on September 1, 2043 ; The loan is collateralized by 615 Florence Street and 740 Barber Street and guaranteed by AIS and Cemtrex. SOFR plus 2.80 % per annum ( 7.04 % as of September 30, 2025, and 7.76 % as of September 30, 2024). 9/30/2043 1,146,630 1,176,112 Fulton Bank (HEISEY) - $ 2,160,000 . promissory 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; matures in 2030. SOFR plus 2.80 % per annum ( 7.04 % as of September 30, 2025, and 7.76 % as of September 30, 2024). 7/1/2030 1,613,677 1,881,621 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. 8 % 6/30/2025 - 244,766 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, 2025, and September 30, 2024. 8 % 2/22/2027 7,871,777 12,195,789 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. 8 % 5/21/2026 621,773 - 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. 1 % 5/5/2025 - 50,628 Less: Unamortized original issue discount ( 33,333 ) Total debt $ 13,512,276 $ 18,002,555 Less: Current maturities ( 8,925,497 ) ( 4,732,377 ) Long-term debt $ 4,586,779 $ 13,270,178 F- 33 Cemtrex Inc. and Subsidiaries Estimated maturities for the Company’s long-term debt over the next 5 years are as follows. SCHEDULE OF ESTIMATED MATURITIES OF LONG TERM DEBT 2026 2027 2028 2029 2030 Thereafter Total Fulton Bank - $ 312,000 58,086 62,126 66,426 71,066 - - $ 257,704 Fulton Bank - $ 2.16 Mil 289,719 311,215 334,127 359,096 319,520 - $ 1,613,677 Fulton Bank - Mortgage #1 85,046 91,267 97,577 105,079 113,548 1,541,531 $ 2,034,048 Fulton Bank - Mortgage #2 32,429 34,833 37,202 40,179 43,160 958,827 $ 1,146,630 Notes Payable 8,460,217 - - - - - $ 8,460,217 TOTAL $ 8,925,497 $ 499,441 $ 535,332 $ 575,420 $ 476,228 $ 2,500,358 $ 13,512,276 NOTE 17 – RELATED PARTY TRANSACTIONS As 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 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. F- 34 Cemtrex Inc. and Subsidiaries On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil. On January 6, 2025, the Company and Saagar Govil signed an agreement to revise the purchase price structure and payment terms. The 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: ● First Year (January 2025) Monthly Payment: $ 10,000 ● Second Year (January 2026) Monthly Payment: $ 20,000 ● Balloon Payment at the end of the Second Year (December 31, 2026): Total outstanding royalties This transaction was approved by the Board of Directors with Saagar Govil abstaining from the vote. Based 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. As 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. As 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. Ltd. in the normal course of business. During the year, the Company recorded $ 60,628 in current expected credit losses on receivables due from CXR Inc. On 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. NOTE 18 – STOCKHOLDERS’ EQUITY Preferred Stock The Company is authorized to issue 10,000,000 shares of Preferred Stock, $ 0.001 par value. As of September 30, 2025, and September 30, 2024, there were 2,755,327 and 2,506,827 shares issued and 2,691,227 and 2,442,727 shares outstanding, respectively. F- 35 Cemtrex Inc. and Subsidiaries Series A Preferred Stock Each issued and outstanding Series A Preferred Share shall be entitled to the number of votes per share equal to the result of: (i) the number of shares of common stock of the Company issued and outstanding at the time of such vote multiplied by 1.01; divided by (ii) the total number of Series A Preferred Shares issued and outstanding at the time of such vote, at each meeting of shareholders of the Company with respect to any and all matters presented to the shareholders of the Company for their action or consideration, including the election of directors. Holders of Series A Preferred Shares shall vote together with the holders of Common Shares as a single class. The Series A Preferred Stock has no liquidation value or preference. The Series A Preferred Stock has no redemption rights. As of September 30, 2025, and September 30, 2024, there were no shares of Series A Preferred Stock issued and outstanding. Series C Preferred Stock On October 3, 2019, pursuant to Article IV of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series C Preferred Stock, consisting of up to one hundred thousand ( 100,000 ) shares, par value $ 0.001 . Under the Certificate of Designation, holders of Series C Preferred Stock are entitled to the number of votes per share equal to the result of (i) the total number of shares of Common Stock outstanding at the time of such vote multiplied by 10.01, and divided by (ii) the total number of shares of Series C Preferred Stock outstanding at the time of such vote, at each meeting of our shareholders with respect to any and all matters presented to our shareholders for their action or consideration, including the election of directors. The Series C Preferred Stock has no liquidation value or preference. The Series C Preferred Stock has no redemption rights. As of September 30, 2025, and September 30, 2024, there were 50,000 shares of Series C Preferred Stock issued and outstanding. Series 1 Preferred Stock Dividends Holders 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. Liquidation Preference The Series 1 Preferred has a liquidation preference of $ 10 per share, equal to its purchase price. In the event of any liquidation, dissolution or winding up of our company, any amounts remaining available for distribution to stockholders after payment of all liabilities of our company will be distributed first to the holders of Series 1 Preferred, and then pari passu to the holders of the Series A preferred stock and our common stock. The holders of Series 1 Preferred have preference over the holders of our common stock on any liquidation, dissolution or winding up of our company. The holders of Series 1 Preferred also have preference over the holders of our Series A preferred stock. Voting Rights Except as otherwise provided in the certificate of designation, preferences and rights or as required by law, the Series 1 Preferred will vote together with the shares of our common stock (and not as a separate class) at any annual or special meetings of stockholders. Except as required by law, each holder of shares of Series 1 Preferred will be entitled to two votes for each share of Series 1 Preferred held on the record date as though each share of Series 1 Preferred were 2 shares of our common stock. Holders of the Series 1 Preferred will vote as a class on any amendment altering or changing the powers, preferences, or special rights of the Series 1 Preferred so as to affect them adversely. No Conversion The Series 1 Preferred will not be convertible into or exchangeable for shares of our common stock or any other security. F- 36 Cemtrex Inc. and Subsidiaries Rank The Series 1 Preferred will rank with respect to distribution rights upon our liquidation, winding-up or dissolution and dividend rights, as applicable: ● senior to our Series A preferred stock, common stock, and any other class of capital stock we issue in the future unless the terms of that stock provide that it ranks senior to any or all of the Series 1 Preferred; ● on a parity with any class of capital stock we issue in the future the terms of which provide that it will rank on a parity with any or all of the Series 1 Preferred; ● junior to each class of capital stock issued in the future the terms of which expressly provide that such capital stock will rank senior to the Series 1 Preferred and the common stock; and ● junior to all of our existing and future indebtedness. Redemption Shares of Series 1 Preferred may be redeemed, in whole or in part, at the option of the Corporation, by the Corporation by giving notice of such redemption at any time. Notice of redemption may be given either by mailing notice to the holders of record or by public announcement, by press release or otherwise. If notice is given by public announcement, by press release or otherwise, such notice shall be effective as of the date of such announcement, regardless of whether notice is also mailed or otherwise given to holders of record. The redemption price for any shares of Series 1 Preferred to be redeemed (the “Redemption Price”) shall be payable in cash, out of funds legally available therefor, and shall be equal to the Preference Amount, plus any accrued but unpaid dividends. If fewer than all of the outstanding shares of Series 1 Preferred are to be redeemed at any time, the Corporation may choose to redeem shares proportionally from all holders or may choose the shares to be redeemed by lot or by any other equitable method. The Company’s Series 1 Preferred Stock was suspended from the Nasdaq Capital Market on January 22, 2024. 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. The deregistration of the Company’s Series 1 Preferred Stock under Section 12(b) of the Exchange Act became effective 90 days after filing of the Form 25. During the year ended September 30, 2025, and 2024, 252,278 and 235,762 shares of Series 1 Preferred Stock were issued to pay dividends to holders of Series 1 Preferred Stock. respectively. As of September 30, 2025, and September 30, 2024, there were 2,705,327 and 2,456,827 shares of Series 1 Preferred Stock issued and 2,641,227 and 2,392,727 shares outstanding, respectively. The Company currently holds 64,100 shares of Series 1 Stock in Treasury stock. On August 22, 2023, the Board of Directors (the “Board”) of Cemtrex, Inc. authorized and approved a share repurchase program for up to 2,200,000 shares of the currently outstanding shares of the Company’s Series 1 Preferred Stock over a period of 3 years, starting on September 1, 2023, and ending on August 31, 2026. Under the stock repurchase program, the Company intends to repurchase shares through open market purchases, privately negotiated transactions, block purchases or otherwise in accordance with applicable federal securities laws, including Rule 10b-18 of the Exchange Act. During the year ended September 30, 2024, the Company has bought back and later cancelled 71,951 shares into treasury 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. During 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. F- 37 Cemtrex Inc. and Subsidiaries The Board also authorized the Company to enter into written trading plans under Rule 10b5-1 of the Exchange Act. Adopting a trading plan that satisfies the conditions of Rule 10b5-1 allows a company to repurchase its shares at times when it might otherwise be prevented from doing so due to self-imposed trading blackout periods or pursuant to insider trading laws. Under any Rule 10b5-1 trading plan, the Company’s third-party broker, subject to Securities and Exchange Commission regulations regarding certain price, market, volume and timing constraints, would have authority to purchase the Company’s Series 1 Preferred Stock in accordance with the terms of the plan. The Company may from time to time enter into Rule 10b5-1 trading plans to facilitate the repurchase of its Series 1 Preferred Stock pursuant to its share repurchase program. The Company cannot predict when or if it will repurchase any shares of Series 1 Preferred Stock as such stock repurchase program will depend on a number of factors, including constraints specified in any Rule 10b5-1 trading plans, price, general business and market conditions, and alternative investment opportunities. Common Stock On 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. On 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 value. 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. May 2024 Equity Financing On May 1, 2024, the Company entered into an underwriting agreement with Aegis Capital Corp., in connection with a firm commitment underwritten public offering (the “Offering”), providing for the issuance of (i) 554,705 units (the “Common Units”), each consisting of one share of common stock of the Company (“Common Stock”), a warrant to purchase one share of common stock at an exercise price of $0.85 per share, which warrant will expire on the two-and-a-half year anniversary of the original issuance date (the “Series A Warrants”), and a warrant to purchase one share of common stock at an exercise price of $0.85 per share, which warrant will expire on the five-year anniversary of the original issuance date (the “Series B Warrants”); and (ii) 11,210,000 pre-funded units (the “Pre-funded Units”), each consisting of one pre-funded warrant to purchase one share of common stock (the “Pre-funded Warrants”), a Series A Warrant and a Series B Warrant. The purchase price of each Unit was $0.85, and the purchase price of each Pre-Funded Unit was $0.849. The Pre-Funded Warrants are immediately exercisable and may be exercised at any time until all of the Pre-Funded Warrants are exercised in full. In addition, the Company granted the Underwriter a 45-day option to purchase additional 1,764,705 shares of common stock and/or Pre-Funded Warrants, representing up to 15 % of the number of common stock and Pre-Funded Warrants sold in the Offering, and/or additional 1,764,705 Series A Warrants representing up to 15 % of the Series A Warrants sold in the Offering, and/or additional 1,764,705 Series B Warrants representing up to 15 % of the Series B Warrants sold in the Offering to cover over-allotments, if any. The Offering closed on May 3, 2024. An aggregate of 11,764,705 Units (which includes 554,705 shares of common stock), 11,210,000 Pre-Funded Units (which includes 11,210,000 Pre-Funded Warrants), and a Series A Warrant and a Series B Warrant were sold in the Offering. On May 3, 2024, the Underwriter partially exercised its over-allotment option with respect to 1,764,705 Series A Warrants and 1,764,705 Series B Warrants. The aggregate gross proceeds to the Company were $ 10,035,293 , before deducting underwriting discounts and other issuance expenses of $ 995,333 . The underwriting discounts and other issuance expenses were expensed since the Series A, Series B, and Pre-Funded Warrants were each determined to be liabilities and recorded at their fair value. F- 38 Cemtrex Inc. and Subsidiaries May 2024 Warrants The Company evaluated the Series A, Series B, and Prefunded Warrants (collectively, the “Warrants”) in accordance with the guidance at ASC 480, Distinguishing Liabilities from Equity and ASC 815-40, Derivatives and Hedging, and determined that the Warrants are precluded from being considered indexed to the entity’s own stock, resulting in the Warrants being classified as a liability. The fair value of the Series A Warrants was determined based on the stock price on issuance of $ 0.277 multiplied by the total number of shares of common stock issuable upon exercise of the Series A alternative cashless exercise. Under the alternative cashless exercise, the Holder is entitled 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); 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 . The total fair value of the Warrants upon issuance was $ 17,290,821 . 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. During 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. During 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. The following table summarizes information about shares issuable under warrants outstanding as of September 30, 2025. SCHEDULE SHARES ISSUABLE UNDER WARRANTS OUTSTANDING Warrant Shares Outstanding Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Outstanding at September 30, 2023 - - Warrants granted 65,327,640 $ 0.85 Warrants exercised ( 15,618,593 ) $ 0.61 Warrants forfeited - Warrants cancelled - Outstanding at September 30, 2024 49,709,047 $ 0.23 2.77 Warrants granted - Warrants exercised ( 29,070,304 ) $ 0.12 Warrants forfeited - Warrants cancelled - Exercise price adjustments ( 18,971,637 ) Outstanding at September 30, 2025 1,667,106 $ 4.84 3.37 On 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 . F- 39 Cemtrex Inc. and Subsidiaries The following table illustrates the adjustment. SCHEDULE OF WARRANTS ADJUSTMENT Warrants outstanding Aggregate Value Adjusted number of warrants outstanding Series A Warrants 12,059,879 $ 10,250,897 13,766,999 Series B Warrants 13,529,410 $ 11,499,999 15,444,550 On 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 . The following table illustrates the adjustment. Warrants outstanding Aggregate Value Adjusted number of warrants outstanding Series A Warrants 1,201,932 $ 894,954 284,225 Series B Warrants 15,444,550 $ 11,499,999 3,652,206 On 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 . The following table illustrates the adjustment. Warrants outstanding Aggregate Value Adjusted number of warrants outstanding Series A Warrants 248,166 $ 260,467 875,034 Series B Warrants 3,318,556 $ 10,449,401 11,701,477 On 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 . The following table illustrates the adjustment. Warrants outstanding Aggregate Value Adjusted number of warrants outstanding Series A Warrants 1,392,381 $ 260,467 49,108 Series B Warrants 14,363,882 $ 8,061,006 1,519,782 F- 40 Cemtrex Inc. and Subsidiaries NOTE 19 – SHARE-BASED COMPENSATION On 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 1 share. This option has an exercise price of $ 1,759,228 per share, which vested upon grant, and they expire after seven years. Additionally, Mr. Govil was granted additional future options; (i) 1 share of the Corporation’s common stock, CETX, at an exercise price of $ 2,100,630 per share vesting on September 25, 2021; (ii) 1 share of the Corporation’s common stock, CETX, at an exercise price of $ 2,520,756 per share vesting on September 25, 2023; and (iii) 1 share of the Corporation’s common stock, CETX, at an exercise price of $ 3,024,907 per share vesting on September 25, 2025. During the years ended September 30, 2025, and 2024 the Company recognized $ 14,236 and $ 30,325 of share-based compensation expense on its outstanding options, respectively. The share-based compensation is listed under the caption “General and administrative” expenses on the Company’s Consolidated Statements of Operations. As of September 30, 2025, there was $ 0 of total unrecognized compensation cost related to non-vested stock options. SCHEDULE OF STOCK OPTIONS ACTIVITY Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding at September 30, 2023 7 $ 1,527,357 3.06 $ - Options granted - - - Options exercised - - - Options forfeited - - - Options cancelled - - - Outstanding at September 30, 2024 7 $ 1,527,357 2.05 $ - Vested and exercisable at September 30, 2024 7 $ 1,527,357 2.05 $ - Options granted - - - Options exercised - - - Options forfeited - - - Options cancelled - - - Outstanding at September 30, 2025 7 $ 1,527,357 1.05 $ - Vested and exercisable at September 30, 2025 7 $ 1,527,357 1.05 $ - NOTE 20 – COMMITMENTS AND CONTINGENCIES From time to time, the Company and its subsidiaries are involved in legal proceedings that are incidental to the operation of our business. The Company continues to defend vigorously against all claims. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including assessment of the merits of the particular claim, as well as current accruals and insurance coverage, the Corporation does not expect that such legal proceedings will have a material adverse impact on its consolidated financial statements. NOTE 21 – INCOME TAXES As 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. F- 41 Cemtrex Inc. and Subsidiaries In 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 authorities. 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. The 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. On 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. At September 30, 2025, the Company had approximately $ 68,941,426 of federal, $ 84,017,242 of state, and $ 9,798,273 of foreign net operating loss carryforwards. The net operating loss carryforwards, if not utilized, will begin to expire in 2030 for federal purposes and in 2026 for state purposes. The company is currently reviewing net operating losses for Section 382 limitation purposes and will make any required adjustments to the net operating losses at the completion of the study. The following is a geographical breakdown of loss before the provision for income taxes. SCHEDULE OF (LOSS) INCOME BEFORE PROVISION FOR TAX Year ended September 30, 2025 2024 Domestic $ ( 28,352,803 ) $ ( 7,090,508 ) Foreign 1,038,715 ( 385,841 ) Loss before provision for income taxes $ ( 27,314,088 ) $ ( 7,476,349 ) The provision for income taxes consisted of the following. SCHEDULE OF PROVISION FOR INCOME TAXES September 30, 2025 September 30, 2024 Current (benefit)/provision Federal $ - $ - State 609,496 165,093 Foreign 125,384 37,187 Total current (benefit)/provision 734,880 202,280 Deferred provision Federal - - State - - Foreign - - Total deferred provision $ - $ - Total (benefit)/provision for income taxes $ 734,880 $ 202,280 F- 42 Cemtrex Inc. and Subsidiaries The following is a reconciliation of the effective income tax rate to the federal and state statutory rates. SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION For the Fiscal Year For the Fiscal Year Ended Ended September 30, 2025 September 30, 2024 U.S. statutory rate 21.00 % 21.00 % State taxes, net of federal 5.03 % - 1.74 % Foreign tax rate differential - 0.28 % - 0.23 % Change in valuation allowance - 0.34 % - 13.23 % Return to provision 0.20 % - 1.44 % State Rate Change 0.21 % - 0.50 % Other True Up Adjustments - 1.25 % 0.00 % Goodwill impairment - 0.00 % 0.00 % Write-Off of Related Party Note with Majority Owner 0.00 % - 1.49 % Issuance Costs - Equity Financing 0.00 % - 2.35 % Interest Expense - 0.98 % - 2.80 % Change in Fair Value of Warrants 10.59 % 1.64 % Loss on Excess Fair Value of Warrants - 14.62 % 0.00 % Other permanent differences - 1.06 % - 1.56 % Effective Tax Rate - 2.69 % - 2.70 % The components of our deferred tax assets and liabilities are summarized as follows. SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES September 30, 2025 September 30, 2024 Deferred Tax Assets: Net operating Loss carryforwards $ 22,289,821 $ 21,908,977 Inventory and other reserves 365,475 1,363,737 Allowance for bad debt 32,212 32,919 CECL Allowance 43,877 - Interest Expense Limitation 4,473,727 4,751,442 Accruals 507,663 439,996 Deferred Revenue 127,838 - Capitalized R&D 1,086,108 852,417 Warranty reserve 58,946 27,287 Lease Liability 120,739 Other 29,087 15,270 Total gross deferred taxes 29,135,493 29,392,044 Valuation allowance ( 28,220,042 ) ( 28,127,540 ) Net deferred tax assets 915,451 1,264,504 Deferred Tax Liabilities: Deferred revenue - ( 296,090 ) Prepaid expenses ( 39,705 ) - Goodwill amortization ( 138,395 ) ( 132,685 ) Depreciation ( 17,751 ) ( 10,020 ) Right of use assets ( 114,738 ) - Other ( 604,862 ) ( 825,710 ) Total deferred tax liabilities ( 915,451 ) ( 1,264,505 ) Total deferred tax assets (liabilities) $ - $ - Deferred 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. F- 43 Cemtrex Inc. and Subsidiaries The 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, and 2024. Future 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. NOTE 22 – DISCONTINUED OPERATIONS On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil. On January 6, 2025, the Company and Saagar Govil signed an agreement to revise the purchase price structure and payment terms. The 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: ● First Year (January 2025) Monthly Payment: $ 10,000 ● Second Year (January 2026) Monthly Payment: $ 20,000 ● Balloon Payment at the end of the Second Year (December 31, 2026): Total outstanding royalties This transaction was approved by the Board of Directors with Saagar Govil abstaining from the vote. Based 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. As 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. As 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. Ltd. in the normal course of business. During the year, the Company recorded $ 60,628 in current expected credit losses on receivables due from CXR Inc. F- 44 Cemtrex Inc. and Subsidiaries Gain/(loss) from discontinued operations, net of tax and the loss on sale of discontinued operations, net of tax, of Cemtrex Advanced Technologies, Inc. and Cemtrex XR, Inc., sold during the first quarter of fiscal year 2023, which are presented in total as discontinued operations, net of tax in the Company’s Consolidated Statements of Operations for the years ended September 30, 2025 and 2024, are as follows. SCHEDULE OF FINANCIAL STATEMENTS INCLUDED WITHIN DISCONTINUED OPERATIONS For the year ended September 30, 2025 2024 Total net sales $ - $ - Cost of sales - - Operating, selling, general and administrative expenses 2,008 681 Other (income)/expenses - - Income (loss) from discontinued operations ( 2,008 ) ( 681 ) Amortization of discounted royalties 99,001 53,126 Expected credit losses on royalty receivable ( 60,000 ) - Adjustment of royalty agreement ( 280,545 ) - Income tax provision - 9,321 Discontinued operations, net of tax $ ( 243,552 ) $ 43,124 NOTE 23 – SUBSEQUENT EVENTS Cemtrex has evaluated subsequent events up to the date the consolidated financial statements were issued. The Company concluded that the following subsequent events have occurred and require recognition or disclosure in the consolidated financial statements. Preferred shares issued for dividend On October 7, 2025, the Company issued 135,291 shares of its Series 1 Preferred Stock to for dividends. The dividend was paid to shareholders of record as of September 30, 2025 . Common shares issued subsequent to financial statements date On 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 . On 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 . On October 9, 2025, 67,671 shares of common stock were issued to make up for fractional shares from September 29, 2025, reverse stock split. On various dates subsequent to September 30, 2025, 3,000,296 shares of common stock were issued to relieve $ 7,844,000 of notes payable. F- 45 Cemtrex Inc. and Subsidiaries Issuance of Note payable On 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. Entry into a Material Definitive Agreement On 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 . On 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. On 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. F- 46