UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14C
(Rule
14c-101)
SCHEDULE
14C INFORMATION STATEMENT
August 2, 2024
Information
Statement Pursuant to Section 14(c) of the Securities Exchange Act of 1934
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Filed
by the registrant |
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Filed
by a party other than the registrant |
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Preliminary
Information Statement |
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Confidential,
for Use of the Commission Only (as permitted by Rule 14c-5(d)(2)) |
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Definitive
Information Statement |
CEMTREX,
INC.
(Name
of Registrant as Specified In Charter)
Payment
of Filing Fee (Check the appropriate box):
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No
fee required. |
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Fee
computed on table below per Exchange Act Rules 14c-5(g) and 0-11. |
1) |
Title
of each class of Securities to which transaction applies: |
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2) |
Aggregate
number of securities to which transaction applies: |
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3) |
Per
unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined): |
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4) |
Proposed
maximum aggregate value of transaction : $____________ |
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5) |
Total
fee paid: $_____________ |
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Fee
paid previously with preliminary materials. |
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Check
box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its
filing. |
1)
Amount Previously Paid:
2)
Form, Schedule or Registration Statement No.
3)
Filing Party:
4)
Date Filed:
![](https://www.sec.gov/Archives/edgar/data/1435064/000149315224030109/formdef14c_001.jpg)
CEMTREX,
INC.
135
Fell Court
Hauppauge,
NY 11788
(631)756-9116
INFORMATION
STATEMENT PURSUANT TO SECTION 14 OF THE SECURITIES EXCHANGE ACT
OF
1934 AND REGULATION 14C AND SCHEDULE 14C THEREUNDER
WE
ARE NOT ASKING YOU FOR A PROXY
AND
YOU ARE NOT REQUESTED TO SEND US A PROXY
NOTICE
OF STOCKHOLDER ACTION BY WRITTEN CONSENT
To
our Stockholders:
NOTICE
IS HEREBY GIVEN that the Board of Directors (the “Board”) of Cemtrex, Inc., a Delaware corporation (“we”, “us”
or “our”), has approved, and the holders of an excess of a majority of the outstanding shares of our classes of voting stock
of the Company, Common Stock, par value $0.001 per share (the “Common Stock”), Series C Preferred Stock, par value $0.001
(the “Series C Preferred”), and Series 1 Preferred Stock, par value $0.001(the “Series 1 Preferred”) have executed
a written consent in lieu of a special meeting approving an amendment to our Certificate of Incorporation to authorize a reverse split
of the Company’s outstanding shares of common stock, par value $0.001 per share, with a split ratio of between 1 for 10 and 1 for
20, which will be determined by the Board of Directors at any time or times for a period of 12 months after the date of the written consent
(the “Reverse Split”).
The
accompanying Information Statement, which describes the above corporate action in more detail, is being furnished to our stockholders
for informational purposes only, pursuant to Section 14(c) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
and the rules and regulations prescribed thereunder. Under the Delaware General Corporation Law and our bylaws, stockholder action may
be taken by written consent without a meeting of stockholders. The written consent of the holders of a majority of our outstanding Common
Stock is sufficient under the Delaware General Corporation Law and our bylaws to approve the actions described above. Accordingly, the
actions described above will not be submitted to our other stockholders for a vote. Pursuant to Rule 14c-2 under the Exchange Act, these
corporate actions will not be effected until at least twenty (20) calendar days after the mailing of the Information Statement to our
stockholders.
This
letter is the notice required by Section 228(e) of the Delaware General Corporation Law. We will first mail the Information Statement
on or about August 9, 2024 to our stockholders of record as of July 22, 2024.
By
Order of the Board of Directors of Cemtrex, Inc.
|
/s/
Saagar Govil |
|
Name: |
Saagar
Govil |
|
Title: |
Chairman,
President and CEO |
CEMTREX,
INC.
135
Fell Court
Hauppauge,
NY 11788
(631)756-9116
INFORMATION
STATEMENT PURSUANT TO SECTION 14(c)
OF
THE SECURITIES EXCHANGE ACT OF 1934 AND RULE 14c-2 THEREUNDER
NO
VOTE OR OTHER ACTION OF STOCKHOLDERS IS REQUIRED IN CONNECTION WITH THIS INFORMATION STATEMENT.
WE
ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
Cemtrex,
Inc., a Delaware corporation (“we”, “us” or “our”) is sending this Information Statement solely for
the purpose of informing our stockholders in the manner required under Regulation 14(c) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), of the actions taken by the holders of a majority of our outstanding shares of our classes of voting
stock of the Company, Common Stock, par value $0.001 per share (the “Common Stock”), Series C Preferred Stock, par value
$0.001 (the “Series C Preferred”), and Series 1 Preferred Stock, par value $0.001(the “Series 1 Preferred”),
by written consent in lieu of a special meeting. No action is requested or required on your part.
What
actions were taken by written consent in lieu of a special meeting?
Our
Board of Directors (the “Board”) has approved, and stockholders holding at least a majority of the issued and outstanding
shares of our classes of voting stock have approved, by written consent in lieu of a special meeting: an amendment to our Certificate
of Incorporation to authorize a reverse split of the Company’s outstanding shares of common stock, par value $0.001 per share,
with a split ratio of between 1 for 10 and 1 for 20, which will be determined by the Board of Directors at any time or times for a period
of 12 months after the date of the written consent (the “Reverse Split”).
Additional
information regarding the Reverse Split is set forth below under “APPROVAL OF THE REVERSE SPLIT”.
What
vote was obtained to approve the Reverse Split described in this Information Statement?
The
Reverse Split was approved by our Board on July 22, 2024, and by our stockholders pursuant to action taken by majority written
consent dated July 22, 2024 (the “Record Date”). The approval of the Reverse Split by written consent of stockholders
in lieu of a special meeting requires the consent of the holders of at least a majority of our outstanding shares of Common Stock and
Preferred Stock as of the Record Date. As of the Record Date, 16,952,270 shares of our Common Stock were issued and outstanding.
Each share of our Common Stock is entitled to one vote. As of the Record Date 50,000 shares of our Series C Preferred were issued and
outstanding. Each share of our Series C Preferred is entitled to the number of votes equal to (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, which amounts to an aggregate of 169,692,223 votes as of the Record Date. As of the Record date 2,456,827 shares of
Series 1 Preferred were issued and 2,392,727 outstanding. Each share of Series 1 Preferred is entitled to two votes, which amounts to
an aggregate of 4,785,454 votes.
Based
on the foregoing, as of the Record Date, the total aggregate amount of votes entitled to vote regarding the approval of the Reverse Split
and Issuance of Preferred Stock was 191,429,947. Pursuant to Delaware General Corporation Law, at least a majority of the voting
equity of the Company, or at least 95,714,974 votes are required to approve the corporate actions by written consent. The majority
of our shareholder voting power, which held 169,996,781 votes equal or approximately 88.8% of the voting equity of the
Company, have voted in favor of the corporate actions, thereby satisfying the requirement pursuant to Delaware General Corporation Law
that at least a majority of the voting equity vote in favor of a corporate action by written consent.
The
following table sets forth the names of the holders of the Common Stock, the Series C Preferred Stock and the Series 1 Preferred Stock,
the number of shares of Common Stock, the Series C Preferred Stock and the Series 1 Preferred Stock held by such holder, the total number
of votes that such holder voted in favor of the corporate actions and the percentage of the issued and outstanding voting equity of the
Company that voted in favor thereof:
Name of Voting Stockholder | |
Class of Stock | |
Number of Shares held | | |
Number of Votes held by such Stockholder | | |
Number of Votes that Voted in Favor of the Reverse
Split | | |
Percentage of the Voting Equity that Voted in Favor
of the Reverse Split | |
Saagar Govil | |
Common Stock | |
| 39,962 | | |
| 39,962 | | |
| 39,962 | | |
| 0.02 | % |
Saagar Govil | |
Series 1 Preferred Stock | |
| 132,298 | | |
| 264,596 | | |
| 264,596 | | |
| 0.14 | % |
Saagar Govil | |
Series C Preferred Stock | |
| 50,000 | | |
| 169,692,223 | | |
| 169,692,223 | | |
| 88.64 | % |
Total | |
| |
| | | |
| | | |
| 169,996,781 | | |
| 88.80 | % |
Who
is paying the cost of this Information Statement?
We
will pay for preparing, printing and mailing this Information Statement. Our costs are estimated at approximately $10,000.
Am
I entitled to dissenter’s rights?
The
Delaware General Corporation Law does not provide for dissenter’s rights for the Reverse Split.
APPROVAL
OF THE REVERSE SPLIT
The
Reverse Split Amendment
Our
Board and stockholders granted the Board discretionary authority within the next twelve (12) months to file a Certificate of Amendment
to the Certificate of Incorporation to effectuate the Reverse Split (the “Reverse Split Amendment”) of all of our issued
and outstanding shares of common stock at an exchange ratio of not less than 1-for-10 and not more than 1-for-20, which we sometimes
refer to as the Reverse Split. The form of the Reverse Split Amendment is attached to this Information Statement as Appendix A.
Background
and Reasons for the Reverse Split
The
Board of Directors has the authority, but not the obligation, in its sole discretion and without any further action on the part of the
stockholders, to effect the Reverse Split within this range at any time it believes to be most advantageous to our Company and stockholders
in the next 12 months. The exact ratio of the Reverse Split, if effected, would be set at a whole number within the range as determined
by the Board of Directors in its sole discretion. The Reverse Split Amendment would not change the number of authorized shares of our
common stock and the par value of our common stock would remain at $0.001 per share. As of the date of this Information Statement, we
do not have any current plans, arrangements or understandings related the issuance of any additional shares of common stock that will
become newly available as a result of the Reverse Split.
On
June 14, 2024, we received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”)
notifying us that, because the closing bid price for our common stock listed on Nasdaq was below $1.00 for 30 consecutive trading days,
we no longer meet the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Marketplace Rule
5550(a)(2), requiring a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”).
In
accordance with Nasdaq Marketplace Rule 5810(c)(3)(A), we have a period of 180 calendar days from the date of notification, or until
December 11, 2024, to regain compliance with the Minimum Bid Price Requirement, during which the stock will continue to list on the Nasdaq.
The
Reverse Stock Split would potentially increase our bid price such that we meet the Minimum Bid Requirement required for maintaining the
listing requirements for the Nasdaq Capital Market. We currently do not meet the Nasdaq Minimum Bid Requirement. The Reverse Stock Split
will not cause us to meet all of the listing requirements for Nasdaq. However, we believe the Reverse Stock Split will increase our stock
price which may help us move towards eventually meeting the Minimum Bid Requirement. We can provide no assurances that the Reverse Stock
Split will have a long-term positive effect on the market price of our common stock, or increase our ability to be maintain listing for
trading on Nasdaq.
We
believe that enabling our Board of Directors to set the ratio within the stated range will provide us with the flexibility to implement
the Reverse Split in a manner designed to maximize the anticipated benefits for our stockholders. In determining a ratio, if any, our
Board of Directors may consider, among other things, factors such as:
● |
the
listing requirements of Nasdaq; |
● |
the
historical trading price and trading volume of our common stock; |
● |
the
number of outstanding shares of our common stock; |
● |
the
then-prevailing trading price and trading volume of our common stock and the anticipated impact of the Reverse Split on the trading
market for our common stock; and |
● |
prevailing
general market and economic conditions. |
Depending
on the ratio for the Reverse Split determined by our Board of Directors, no less than 10 and no more than 20 shares of existing issued
and outstanding common stock, as determined by our Board of Directors or a committee thereof, will be combined into one share of common
stock. The Reverse Split Amendment, if any, will effect only the Reverse Split Ratio within such range determined by our Board of Directors
to be in the best interests of our stockholders.
The
Board will retain the authority not to effect the Reverse Split even though it has already obtained stockholder approval. Thus, the Board,
at its discretion, may cause the filing of the Reverse Split Amendment to effect a Reverse Split or abandon it and effect no Reverse
Split if it determines that such action is not in the best interests of our Company and stockholders.
Purpose
of the Reverse Split
The
Board of Directors is notifying stockholders of the proposed Reverse Split in connection with the plan to maintain listing our common
stock on Nasdaq. The Board believes the consummation of the Reverse Split and the continued listing of our common stock on Nasdaq will
make our common stock more attractive to a broader range of institutional and other investors. Accordingly, for these and other reasons
described in this Information Statement, we believe that effecting the Reverse Split is in the Company’s and our stockholders’
best interests.
We
believe that the Reverse Split will improve our ability to maintain listing on Nasdaq. Nasdaq requires, among other items, an initial
bid price of least $4.00 per share and following initial listing, maintenance of a continued price of at least $1.00 per share. A decrease
in the number of outstanding shares of our common stock resulting from a Reverse Split should, absent other factors, increase the per
share market price of our common stock, although we cannot provide any assurance that our minimum bid price would remain over the Minimum
Bid Price Requirement of Nasdaq following the Reverse Split.
Additionally,
we believe that the Reverse Split will make our common stock more attractive to a broader range of institutional and other investors,
as we have been advised that the current market price of our common stock may affect its acceptability to certain institutional investors,
professional investors and other members of the investing public. As previously discussed, many brokerage houses and institutional investors
have internal policies and practices that either prohibit them from investing in low-priced stocks or tend to discourage individual brokers
from recommending low-priced stocks to their customers. In addition, some of those policies and practices may function to make the processing
of trades in low-priced stocks economically unattractive to brokers. Moreover, because brokers’ commissions on low-priced stocks
generally represent a higher percentage of the stock price than commissions on higher-priced stocks, the current average price per share
of common stock can result in individual stockholders paying transaction costs representing a higher percentage of their total share
value than would be the case if the share price were substantially higher. We believe that the Reverse Split will make our common stock
a more attractive and cost-effective investment for many investors, which will enhance the liquidity of the holders of our common stock.
Reducing
the number of outstanding shares of our common stock through the Reverse Split is intended, absent other factors, to increase the per
share market price of our common stock in order to attract new investors and meet the Minimum Bid Price Requirement of Nasdaq. However,
other factors, such as our financial results, market conditions and the market perception of our business may adversely affect the market
price of our common stock. As a result, we cannot assure you that the Reverse Split, if completed, will result in the intended benefits
described above, that the market price of our common stock will increase following the Reverse Split or that the market price of our
common stock will not decrease in the future. Additionally, we cannot assure you that the market price per share of our common stock
after a Reverse Split will increase in proportion to the reduction in the number of shares of our common stock outstanding before the
Reverse Split. Accordingly, the total market capitalization of our common stock after the Reverse Split may be lower than the total market
capitalization before the Reverse Split.
Procedure
for Implementing the Reverse Split
The
Reverse Split, if effected, would become effective upon the filing (the “Effective Time”) of the Reverse Split Amendment
with the Office of the Secretary of State of the State of Delaware. The Reverse Split Amendment will implement the exchange ratio (of
not less than 1-for-10 nor more than 1-for-20) as determined by the Board of Directors prior to the Effective Time. The exact timing
of the filing of the Reverse Split Amendment will be determined by our Board of Directors based on its evaluation as to when such action
will be the most advantageous to the Company and our stockholders. In addition, our Board of Directors reserves the right, notwithstanding
stockholder approval and without further action by the stockholders, to elect not to proceed with the Reverse Split if, at any time prior
to filing the Reverse Split Amendment, our Board, in its sole discretion, determines that it is no longer in our best interest and the
best interests of our stockholders to proceed with the Reverse Split.
Effect
of the Reverse Split on Holders of Outstanding Common Stock
The
Reverse Split will not affect any stockholder’s percentage ownership interest in our Company, except as described below in “Fractional
Shares” and with respect to the Adjustable Warrants, also described below. Record holders of our common stock otherwise entitled
to a fractional share as a result of the Reverse Split because they hold a number of shares not evenly divisible by the Reverse Split
Ratio will automatically be entitled to receive an additional fraction of a share of our common stock to round up to the next whole share.
In addition, the Reverse Split will not affect any stockholder’s proportionate voting power (subject to the treatment of Fractional
Shares and Adjustable Warrants as discussed herein).
The
Reverse Split will not change the terms of our common stock. After the Reverse Split, the shares of our common stock will have the same
voting rights and rights to dividends and distributions and will be identical in all other respects to our common stock now authorized.
Our common stock will remain fully paid and non-assessable.
After
the effective time of the Reverse Split, we will continue to be subject to the periodic reporting and other requirements of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”). The Reverse Split is not intended as, and will not have the effect
of, a “going private transaction” as described by Rule 13e-3 under the Exchange Act.
After
the Effective Time of a Reverse Split, the post-split market price of our common stock may be less than the pre-split price multiplied
by the Reverse Split Ratio. In addition, a reduction in the number of shares of our common stock outstanding may impair the liquidity
for our common stock, which may reduce the value of our common stock.
The
availability of a substantial number of authorized but un-issued shares of our common stock resulting from the Reverse Split, under various
scenarios, may be construed as having an anti-takeover effect by permitting the issuance of shares of our common stock to purchasers
who might oppose a hostile takeover bid or oppose any efforts to amend or repeal certain provisions in our Articles of Incorporation
or bylaws as then in effect. The proposal to effectuate the Reverse Split did not result from our knowledge of any specific effort to
accumulate our securities or to obtain control of us by means of a merger, tender offer, proxy solicitation in opposition to management
or otherwise, and our Board of Directors did not authorize the Reverse Split to increase the authorized shares of our common stock to
enable us to frustrate any efforts by another party to acquire a controlling interest or to seek representation on our Board of Directors.
In
addition, the Reverse Split will increase the number of stockholders of the Company who own odd lots (less than 100 shares). Stockholders
who hold odd lots typically will experience an increase in the cost of selling their shares, as well as possible greater difficulty in
effecting such sales. Consequently, there can be no assurance that the Reverse Split will achieve the desired results that have been
outlined above.
The
principal effect of the Reverse Split will be that (i) the number of shares of common stock issued and outstanding will be reduced to
a number of shares between and including one-tenth to one-twentieth that amount, as the case may be based on the ratio for the Reverse
Split as determined by our Board, and (ii) all outstanding options and warrants (other than the Adjustable Warrants described above)
entitling the holders thereof to purchase shares of common stock will enable such holders to purchase, upon exercise of their options
or warrants (other than the Adjustable Warrants described below), as applicable, between and including one-tenth to one-twentieth of
the number of shares of common stock which such holders would have been able to purchase upon exercise of their options or warrants (other
than the Adjustable Warrants described below), as applicable, immediately preceding the Reverse Split at an exercise price equal to between
and including 10 to 20 times the exercise price specified before the Reverse Split, resulting in essentially the same aggregate price
being required to be paid therefor upon exercise thereof immediately preceding the Reverse Split, as the case may be based on the ratio
for the reverse stock split as determined by our Board. Other awards under our 2020 Equity Compensation Plan would be subject to proportionate
adjustments.
The
following table, which is for illustrative purposes only, illustrates the effects of Reverse Split at certain exchange ratios within
the foregoing range, without giving effect to any adjustments for fractional shares of common stock, on our outstanding shares of common
stock and authorized shares of capital stock as of the Record Date.
| |
Before
Reverse | |
After
Reverse Stock Split |
| |
Split | |
1-for-10 | |
1-for-20 |
Common
Stock Authorized | |
| 50,000,000 | | |
| 50,000,000 | | |
| 50,000,000 | |
| |
| | | |
| | | |
| | |
Preferred
Stock Authorized | |
| 10,000,000 | | |
| 10,000,000 | | |
| 10,000,000 | |
| |
| | | |
| | | |
| | |
Common
Stock Issued and Outstanding | |
| 16,292,270 | | |
| 1,629,227 | | |
| 814,614 | |
| |
| | | |
| | | |
| | |
Common
Stock Underlying Options and Warrants (1) | |
| 50,037,843 | | |
| 5,003,784 | | |
| 2,501,892 | |
| |
| | | |
| | | |
| | |
Common
Stock Available for Grant under 2020 Equity Compensation Plan | |
| 1,991,207 | | |
| 199,121 | | |
| 99,560 | |
(1)
The number of shares in the table above, does not take into account any adjustments that may occur after the completion of the Reverse
Split in the Adjustable Warrants outstanding as described in the section “Certain Risk Associated with the Reverse Split”
below.
Certain
Risk Associated with the Reverse Split
There
are certain risks associated with the implementation of the Reverse Split, including as follows.
■ |
While
the Board believes that a higher stock price may help generate investor interest, there can be no assurance that the Reverse Split
will result in any particular price for our common stock or result in a per share price that will attract institutional investors
or investment funds or that such share price will satisfy the investing guidelines of institutional investors or investment funds.
As a result, the trading liquidity of our common stock may not necessarily improve. |
|
|
■ |
There
can be no assurance that the market price per new share of our common stock after a Reverse Split will remain unchanged or increase
in proportion to the reduction in the number of old shares of our common stock outstanding before the reverse stock split. We completed
a prior reverse split in January 2023, after which the trading price of our common stock fell significantly. Accordingly, the total
market capitalization of our common stock after the Reverse Split may be lower than the total market capitalization before the Reverse
Split. Moreover, in the future, the market price of our common stock following the Reverse Split may not exceed or remain higher
than the market price prior to the Reverse Split. |
|
|
■ |
Although
we expect that the Reverse Split will result in an increase in the market price of our common stock, we cannot assure you that the
Reverse Split, if implemented, will increase the market price of our common stock in proportion to the reduction in the number of
shares of common stock outstanding or result in a permanent increase in the market price. The effect the Reverse Split may have upon
the market price of our common stock cannot be predicted with any certainty, and the history of similar reverse stock splits for
companies in similar circumstances to ours is varied. If the Reverse Split is effected and the market price of our common stock declines,
the percentage decline may be greater than would occur in the absence of a Reverse Split. The market price of our common stock will,
however, also be based on performance and other factors, which are unrelated to the number of shares outstanding. Furthermore, the
liquidity of our common stock could be adversely affected by the reduced number of shares that would be outstanding after the Reverse
Split. |
|
|
■ |
The
Reverse Split may result in some stockholders owing “odd lots” of less than 100 shares of our common stock on a post-split
basis. These odd lots may be more difficult to sell, or require greater transaction costs per share to sell, than shares in “round
lots” of even multiples of 100 shares. |
|
|
■ |
We
have outstanding warrants to purchase 50,009,047 shares of common stock at an exercise price of $0.85 per share (the “Adjustable
Warrants”) that provide that upon the completion of the Reverse Split the exercise price of warrants will be reduced to the
lowest daily volume weighted average price during the five consecutive trading days prior to the date of such Reverse Split and the
five consecutive trading days after the date of such Reverse Split (assuming such price is less than the exercise price then in effect),
and the number of warrant shares issuable shall be increased such that the aggregate exercise price payable thereunder, after taking
into account the decrease in the exercise price, shall be equal to the aggregate exercise price on the date of issuance. If we complete
a Reverse Split, this provision will likely result in the post-split exercise price of the Adjustable Warrants being reduced and
the number of shares of common stock underlying the Adjustable Warrants being significantly increased. By approving the Reverse Split,
our Board and majority shareholder have approved the foregoing adjustments. |
Beneficial
Holders of Common Stock
Upon
the implementation of the Reverse Split, we intend to treat shares held by stockholders through a bank, broker, custodian or other nominee
in the same manner as registered stockholders whose shares are registered in their names. Banks, brokers, custodians or other nominees
will be instructed to effect the Reverse Split for their beneficial holders holding our common stock in street name. However, these banks,
brokers, custodians or other nominees may have different procedures than we have instituted for registered stockholders for processing
the Reverse Split. Stockholders who hold shares of our common stock with a bank, broker, custodian or other nominee and who have any
questions in this regard are encouraged to contact their banks, brokers, custodians or other nominees.
Registered
“Book-Entry” Holders of Common Stock (i.e., stockholders that are registered on the transfer agent’s books and records
but do not hold stock certificates)
Some
of our registered holders of common stock may hold their shares electronically in book-entry form with the transfer agent. These stockholders
do not have stock certificates evidencing their ownership in our common stock. They are, however, provided with a statement reflecting
the number of shares registered in their accounts.
If
your shares of common stock are held in book-entry form, you will receive a transmittal letter from our transfer agent, who is also acting
as our exchange agent in connection with our Reverse Split, as soon as practicable after the Effective Time. The letter of transmittal
will contain instructions on how to receive your post-Reverse Split shares of common stock electronically in book-entry form under the
Direct Registration System (DRS). Shareholders will need to return to our transfer agent a properly executed and completed letter of
transmittal in order to receive their new book-entry statement representing post-reverse split shares of common stock. The post-reverse
split shares of common stock will contain the same restrictive legends as the pre-reverse split shares.
Holders
of Certificated Shares of Common Stock
Shareholders
holding shares of the Company’s common stock in certificated form will be sent a transmittal letter by the Company’s transfer
agent after the Reverse Split is effective. The letter of transmittal will specify instructions regarding how a shareholder should surrender
his, her or its certificate(s) representing the Company’s common stock to our transfer agent in exchange for certificates representing
the appropriate number of whole shares of post-Reverse Split common stock. No new certificates will be issued to a shareholder until
such shareholder has surrendered all old certificates, together with a properly completed and executed letter of transmittal, to our
transfer agent. No shareholder will be required to pay a transfer or other fee to exchange his, her or its old certificate(s). Shareholders
will then receive new certificates representing the number of whole common shares that they are entitled to as a result of the Reverse
Split, subject to the treatment of fractional shares. Until surrendered, the Company will deem outstanding old certificates held by shareholders
to be cancelled and only represent the number of whole post-Reverse Split shares of our common stock to which those shareholders are
entitled, subject to such treatment of fractional shares. Any old certificates submitted for exchange, whether because of a sale, transfer
or other disposition, will automatically be exchanged for new certificates. If an old certificate has a restrictive legend, the new certificate
will be issued with the same restrictive legend.
STOCKHOLDERS
SHOULD NOT DESTROY ANY STOCK CERTIFICATE(S) AND SHOULD NOT SUBMIT ANY STOCK CERTIFICATE(S) UNTIL REQUESTED TO DO SO.
Fractional
Shares
We
do not currently intend to issue fractional shares in connection with the Reverse Split. Therefore, we will not issue certificates representing
fractional shares. In lieu of issuing fractions of shares, the Company will round up the fractional share to the next whole share.
Accounting
Matters
The
proposed Reverse Split Amendment will not affect the par value of our common stock per share, which will remain $0.001 par value per
share. Reported per share net income or loss will be higher because there will be fewer shares of common stock outstanding.
Board
Discretion to Implement the Reverse Split
The
Board of Directors, in its sole discretion, may determine to implement the Reverse Split. Notwithstanding the approval of the Reverse
Split by our majority shareholders, the Board of Directors, in its sole discretion, may determine not to implement the Reverse Split.
Transfer
Agent and Registrar
The
transfer agent and registrar for our common stock is Clear Trust, LLC, having an address at 16540 Pointe Village Dr. Ste 205 Lutz, FL
33558 and telephone number (813) 235.4490.
Consequences
if the Reverse Split Amendment is Not Filed
The
Reverse Split Amendment to effect the proposed Reverse Split of our issued and outstanding common stock is necessary for us to increase
the trading price of our common stock and meet the Minimum Bid Price Requirement of Nasdaq. In order to move forward with our business
strategy, key initiatives and plans to grow our business, we must raise additional funds and increase the price-per-share of our common
stock. If we do not effect the Reverse Split, in all likelihood we would be unable to maintain our common stock on Nasdaq and we may
be unable to obtain adequate capital to expand our sales and marketing efforts, increase our product offerings and grow our business.
Without such additional capital, we may be required to scale back or eliminate some or all of our operations, which may have a material
adverse effect on our business.
SECURITIES
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth, as of the Record Date, certain information as to shares of our common stock, Series A Preferred Stock and
Series 1 Preferred Stock, all voting capital of the Company, owned by (i) each person known by us to beneficially own more than 5% of
our outstanding common stock, Series A Preferred Stock and Series 1 Preferred Stock (ii) each of our directors, and (iii) all of our
executive officers and directors as a group. Unless otherwise stated, the address for each beneficial owner is at 135 Fell Court Hauppauge,
NY 11788.
Name
of Beneficial Owner | |
Common
Stock | | |
Series
1 Preferred Stock | | |
Series
C Preferred Stock | |
Directors
and Executive Officers | |
Number
of Shares Owned | | |
Percent
of Class(1) | | |
Number
of Shares Owned | | |
Percent
of Class(1)(2) | | |
Number
of Shares Owned | | |
Percent
of Class(1)(3) | |
Saagar
Govil | |
| 59,012 | | |
| * | | |
| 132,298 | | |
| 5.53 | % | |
| 50,000 | | |
| 100 | % |
Paul
J. Wyckoff | |
| - | | |
| * | | |
| - | | |
| * | | |
| - | | |
| * | |
Brian
Kwon | |
| 2,858 | | |
| * | | |
| - | | |
| * | | |
| - | | |
| * | |
Manpreet
Singh | |
| 2,858 | | |
| * | | |
| - | | |
| * | | |
| - | | |
| * | |
Metodi
Filipov | |
| 2,858 | | |
| * | | |
| - | | |
| * | | |
| - | | |
| * | |
All
Directors and Executive Officers as a Group (5 persons) | |
| 67,586 | | |
| * | | |
| 132,298 | | |
| 5.53 | % | |
| 50,000 | | |
| 100 | % |
Greater than 5% stockholders | |
Number of Shares Owned | | |
Percent of Class(1) | | |
Number of Shares Owned | | |
Percent of Class(1)(2) | | |
Number of Shares Owned | | |
Percent of Class(1)(3) | |
Altium Capital Management, LP (4) | |
| 1,536,984 | | |
| 9.07 | % | |
| - | | |
| * | | |
| - | | |
| * | |
L1 Capital Global Opportunities Master Fund, Ltd. (5) | |
| 1,280,866 | | |
| 7.56 | % | |
| - | | |
| * | | |
| - | | |
| * | |
S.H.N. Financial Investments Ltd. (6) | |
| 1,280,866 | | |
| 7.56 | % | |
| - | | |
| * | | |
| - | | |
| * | |
All greater than 5% shareholders | |
| 4,098,716 | | |
| 24.18 | % | |
| - | | |
| * | | |
| - | | |
| * | |
(1) |
As
of July 22, 2024, 16,952,270 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 169,692,223 shares in the aggregate, all of which is held
by Saagar Govil and 2,392,727 shares of Series 1 Preferred Stock outstanding which are entitled to vote 4,785,454 shares in the aggregate.
Accordingly, there are a total of 191,429,947 voting shares outstanding. |
|
|
(2) |
Pursuant
to the Certificate of Designation of the Series 1 Preferred Stock, each issued and outstanding share is entitled to two votes per
share of Series 1 Preferred Stock 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. |
|
|
(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) |
Share
ownership information is based on information contained in a Schedule 13G filed with the Securities and Exchange Commission on May
8, 2024, by Altium Growth Fund, LP, Altium Capital Management, LLC, and Altium Growth GP, LLC (collectively, the “Altium Entities”).
Altium Growth Fund, LP is the record and direct beneficial owner of these securities. Altium Capital Management, LP is the investment
adviser of, and may be deemed to beneficially own securities, owned by, Altium Growth Fund, LP. Altium Growth GP, LLC is the general
partner of, and may be deemed to beneficially own securities owned by, Altium Growth Fund, LP. The address of the principal business
office of each of the Altium Entities is 152 West 57 Street, FL 20, New York, NY 10019. |
|
|
(5) |
Share
ownership information is based on information contained in a Schedule 13G filed with the Securities and Exchange Commission on May
10, 2024, by L1 Capital Global Opportunities Master Fund, Ltd. David Feldman and Joel Arber are the Directors of L1 Capital Global
Opportunities Master Fund, Ltd. As such, L1 Capital Global Opportunities Master Fund, Ltd., Mr. Feldman, and Mr. Arber may be deemed
to beneficially own (as that term is defined in Rule 13d-3 under the Securities Exchange Act of 1934) the Company’s securities.
The address of the principal business office of by L1 Capital Global Opportunities Master Fund, Ltd. is 161A Shedden Road, 1 Artillery
Court PO Box 10085 Grand Cayman, Cayman Islands KY1-1001. |
EXPENSE
OF INFORMATION STATEMENT
The
expenses of mailing this Information Statement will be borne by us, including expenses in connection with the preparation and mailing
of this Information Statement and all documents that now accompany or may after supplementing it. It is contemplated that brokerage houses,
custodians, nominees, and fiduciaries will be requested to forward the Information Statement to the beneficial owners of our Common Stock
held of record by such persons and that we will reimburse them for their reasonable expenses incurred in connection therewith. Additional
copies of this Information Statement may be obtained at no charge by writing to us at: 135 Fell Court Hauppauge, NY 11788.
MISCELLANEOUS
One
Information Statement will be delivered to multiple stockholders sharing an address unless we receive contrary instructions from one
or more of the stockholders sharing such address. Upon receipt of such notice, we will undertake to promptly deliver a separate copy
of this Information Statement to the stockholder at the shared address to which a single copy of the Information Statement was delivered
and provide instructions as to how the stockholder can notify us that the stockholder wishes to receive a separate copy of this Information
Statement or other communications to the stockholder in the future. In the event a stockholder desires to provide us with such notice,
it may be given verbally by telephoning our offices at (631) 756-9116 or by mail to our address at 135 Fell Court Hauppauge, NY 11788,
and Attn: Investor Relations.
We
file annual, quarterly and current reports, proxy statements, and registration statements with the SEC. These filings are available to
the public over the Internet at the SEC’s website at http://www.sec.gov. You may also read and copy any document we file with the
SEC without charge at the public reference facility maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You may also
obtain copies of the documents at prescribed rates by writing to the Public Reference Section of the SEC at 100 F Street, N.E., Washington,
D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference facilities.
August
2, 2024 |
By
Order of the Board of Directors of Cemtrex, Inc. |
|
|
|
/s/
Saagar Govil |
|
Saagar
Govil |
|
Chairman,
CEO, & President |
APPENDIX
A
FORM
OF CERTIFICATE OF AMENDMENT TO
CERTIFICATE
OF INCORPORATION
OF
CEMTREX, INC.
Cemtrex,
Inc.
2.
|
The
articles have been amended as follows (provide article numbers, if available): |
Fourth
Article:
Effective
at 12:01 a.m. on [ ], 2024 (the “Effective Time”), every [ ] shares of common stock issued and
outstanding immediately prior to the Effective Time (“Old Common Stock”) shall automatically be combined, without any action
on the part of the holder thereof, into one (1) validly issued, fully paid and non-assessable share of common stock (“New Common
Stock”), subject to the treatment of fractional share interests as described below (the “Reverse Stock Split”). No
fractional shares of common stock shall be issued in connection with the Reverse Stock Split. No stockholder of the Corporation shall
transfer any fractional shares of common stock. The Corporation shall not recognize on its stock record books any purported transfer
of any fractional share of common stock. No certificates representing fractional shares of New Common Stock will be issued in connection
with the Reverse Stock Split. Holders who otherwise would be entitled to receive fractional share interests of New Common Stock because
they hold a number of shares not evenly divisible by the Reverse Stock Split ratio will automatically be entitled to receive an additional
fraction of a share of New Common Stock to round up to the next whole share of New Common Stock in lieu of any fractional share created
as a result of such Reverse Stock Split. Each certificate that immediately prior to the Effective Time represented shares of Old Common
Stock (“Old Certificates”), shall thereafter represent that number of shares of New Common Stock into which the shares of
Old Common Stock represented by the Old Certificate shall have been combined.
3.
|
The
vote by which the stockholders holding shares in the corporation entitling them to exercise at least a majority of the voting power,
or such greater proportion of the voting power as may be required in the case of a vote by classes or series, or as may be required
by the provisions of the articles of incorporation have voted in favor of the amendment is: _____________ shares of common stock,
Series C Preferred Stock and Series 1 Preferred Stock, voting as a single class, for ___% of the voting capital of the Corporation. |
|
|
4.
|
Effective
date of filing (optional): Upon filing |
|
|
5.
|
Officer
Signature (Required): |
|
|
|
|
Saagar
Govil, Chairman, President and Executive Officer |
|
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