Cemtrex details $3.5M Plant Engineering deal
Cemtrex details the PES asset acquisition, related earnout structure, SEC-waiver financials and a pro forma balance sheet showing significant goodwill from the deal.
Rhea-AI Filing Summary
CEMTREX INC (CETX) filed an amended report to provide detailed historical and pro forma financial information related to its acquisition of substantially all assets of Plant Engineering Services, Inc. (PES), completed on July 1, 2026 through subsidiary AIS Engineering, Inc. Cemtrex agreed to pay $3,500,000 in cash, subject to a working capital adjustment, and assume certain liabilities, with the Seller Parties eligible for up to approximately $1,750,000 of contingent earnout consideration over three years based on gross profit targets.
An audited Statement of Assets Acquired and Liabilities Assumed for PES shows assets of $409,566 and liabilities of $2,755,409, resulting in net assets acquired of $(2,345,843). Contract liabilities of $2,396,007 are expected to be recognized as revenue within a year. The total fair value of purchase price allocated is $3,570,424, including cash consideration after fees, contingent consideration of $859,031, and working capital adjustments. On a pro forma basis, Cemtrex reports combined total assets of $73,607,627, with preliminary goodwill of $5,403,782 and identifiable intangible assets of $419,000 recorded from the PES acquisition.
Positive
- None.
Negative
- None.
Filing Explained
The completed July 1 acquisition used $2,711,393 of cash; common shares were unchanged, while its purchase-price allocation remains preliminary.
The completed July 1 acquisition was funded with
The filing presents the balance sheet as pro forma rather than the company’s actual combined financial position and says it is not necessarily indicative of that position. The purchase-price allocation remains preliminary; the company says the final allocation will be determined within one year of closing and could materially change the balance sheet.
8-K Event Classification
Key Figures
Key Terms
contingent consideration financial
Earnout Consideration financial
percentage-of-completion method financial
right-of-use operating lease assets financial
Multi-Period Excess Earnings Method financial
Rule 3-05 of Regulation S-X regulatory
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What business combination did CETX complete with Plant Engineering Services, Inc.?
What is the purchase price and earnout structure for CETX’s PES acquisition?
What do the audited PES assets and liabilities acquired by CETX show?
How much goodwill does CETX preliminarily record from the PES acquisition?
What pro forma financial impact does the PES deal have on CETX’s balance sheet?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
(Amendment No. 1)
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| ||
| (Address of principal executive offices) | (Zip Code) |
Registrant’s
telephone number, including area code:
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of each exchange on which registered | ||
CURRENT REPORT ON FORM 8-K
Cemtrex, Inc.
Explanatory Note
This Current Report on Form 8-K/A amends Item 9.01 of the Current Report on Form 8-K filed by the Company on July 6, 2026, to include the historical financial statements of PES and the proforma financial information required by Item 9.01 of Form 8-K, attached hereto as Exhibits 99.1 and 99.2. The proforma financial information included in this Form 8-K/A has been presented for informational purposes only, as required by Form 8-K. It does not purport to represent the actual results of operations that the Company and PES would have achieved had the companies been combined during the periods presented in the proforma financial information and is not intended to project the future results of operations that the combined company may achieve as a result of the acquisition. Except as described above, all other information in the Company’s Current Report on Form 8-K filed on July 6, 2026, remains unchanged.
Item 1.01 Entry into a Material Definitive Agreement.
As previously disclosed in the Current Report on Form 8-K filed on July 6, 2026, on July 1, 2026, Cemtrex, Inc. (the “Company”) entered into an Asset Purchase Agreement (the “Agreement”) with Mark Bohler, an individual resident of Indiana (the “Seller”), pursuant to which the Company agreed to acquire substantially all of the assets of PES for a purchase price of $3,500,000 in cash subject to a customary working capital adjustment, plus the assumption of certain liabilities. Additionally, the Seller Parties are eligible to receive up to approximately $1,750,000 in contingent earnout consideration over a three-year period based on the achievement of specified gross profit targets.
Item 2.01 Completion of Acquisition or Disposition of Assets.
The information set forth in Item 1.01 of the Original Form 8-K is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
| (a) | Financial Statements of Businesses Acquired. |
The Audited Statement of Assets Acquired and Liabilities Assumed of PES as of July 1, 2026, the notes related thereto, and the related report of Grassi & Co., The Company’s independent registered public accounting firm as of July 1, 2026, are filed as Exhibit 99.1 and incorporated herein by reference.
Pursuant to a letter dated August 7, 2026, from the Securities and Exchange Commission’s Division of Corporation Finance (the “SEC”), based on information the Company provided to the SEC, the SEC advised that the Company could provide the Audited Statement of Assets Acquired and Liabilities Assumed in lieu of the financial statements of PES and a proforma condensed balance sheet pursuant to Rule 11-01 for the purpose of complying with the requirements of Rule 3-05 of Regulation S-X.
| (b) | Proforma Financial Information. |
In accordance with the waiver received from the SEC, the Company’s unaudited proforma condensed balance sheet with respect to the acquisition of PES is included in this Current Report as Exhibit 99.2.
(d) Exhibits
| Exhibit Number | Exhibit Title | |
| 23.1 | Consent of Grassi & Co. CPAs P.C., independent registered public accounting firm. | |
| 99.1 | Audited statement of assets acquired, and liabilities assumed as of July 1, 2026 | |
| 99.2 | Unaudited proforma condensed balance sheet as of June 30, 2026 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| 2 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CEMTREX, INC. | ||||
| Date: | September 16, 2026 | By: | /s/ Saagar Govil | |
| Saagar Govil | ||||
| Chairman, President and Chief Executive Officer | ||||
| 3 |
Exhibit 99.1
Plant Engineering Services, Inc
Statement of Assets Acquired and Liabilities Assumed
Table of Contents
| Page | ||
| Report of Independent Registered Public Accounting Firm | 1 | |
| Statement of Assets Acquired and Liabilities Assumed | 2 | |
| Notes to Statement of Assets Acquired and Liabilities Assumed | 3 |
| 1 |
Plant Engineering Services, Inc
Statement of Assets Acquired and Liabilities Assumed
As of July 1, 2026
| Assets Acquired | ||||
| Current assets: | ||||
| Trade receivables, net | $ | 141,367 | ||
| Pre-paid Expenses | 38,994 | |||
| Total current assets | 180,361 | |||
| Property and equipment, net | 24,812 | |||
| Right-of-use operating lease assets | 204,393 | |||
| Total assets acquired | 409,566 | |||
| Liabilities Assumed | ||||
| Current liabilities: | ||||
| Accounts payable | 155,009 | |||
| Operating lease liabilities - short-term | 55,207 | |||
| Contract liabilities | 2,396,007 | |||
| Total current liabilities | 2,606,223 | |||
| Long-term operating lease liabilities | 149,186 | |||
| Total liabilities assumed | 2,755,409 | |||
| Net assets acquired | $ | (2,345,843 | ) |
| 2 |
Plant Engineering Services, Inc
Notes to Statement of Assets Acquired and Liabilities Assumed
Note 1 – Description of Business
On July 1, 2026, Cemtrex, Inc. (the “Company”), through its wholly owned subsidiary Advanced Industrial Services (“AIS”), completed the acquisition of substantially all of the assets of Plant Engineering Services, Inc, an Indiana corporation (“PES”) pursuant to an Asset Purchase Agreement dated July 1, 2026 (the “Asset Purchase Agreement”) by and among AIS Engineering, Inc., a newly formed wholly owned subsidiary of AIS (“Buyer”), PES, and Mark Bohler, an individual residing in state of Indiana (“the “Owner” and collectively with the PES, the “Seller Parties”).
As a result of the transaction, PES’s business operations have been integrated into the Company’s Industrial Services Segment, and Buyer has become the owner of the acquired assets.
The purchase price for the business assets was $3,500,000, in cash, subject to a customary working capital adjustment, plus the assumption of certain liabilities. Additionally, the Seller Parties are eligible to receive up to approximately $1,750,000 in contingent earnout consideration over a three-year period based on the achievement of specified gross profit targets.
The total purchase price consisted of the following components:
| Total consideration: | ||||
| Cash consideration | $ | 3,500,000 | ||
| Less transaction fees and expenses | 279,793 | |||
| Total cash consideration | 3,220,207 | |||
| Contingent consideration (1) | 859,031 | |||
| Working capital adjustments, net | (508,814 | ) | ||
| Total fair value of purchase price | $ | 3,570,424 | ||
| (1) | See Note 3, Contingent Consideration and Earnout Arrangements for additional information. |
Note 2 – Significant Accounting Policies
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities, if any, at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Basis of Presentation
The accompanying statement of assets acquired and liabilities assumed has been prepared for the purpose of presenting the assets acquired and liabilities assumed in the acquisition of PES by Cemtrex, Inc. as of July 1, 2026, in accordance with a request for relief granted by the Securities and Exchange Commission (“SEC”), the Statement of Assets Acquired and Liabilities Assumed of PES (the “Statement”)
The statement has been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as required by Rule 3-05 of SEC Regulation S-X
| 3 |
This statement is not intended to present the complete financial position, results of operations, or cash flows of the acquired business and should be read in conjunction with the related notes describing the acquisition transaction and the basis used to measure the assets acquired and liabilities assumed.
In accordance with a request for relief granted by the Securities and Exchange Commission (“SEC”), the Statement of Assets Acquired and Liabilities Assumed of PES (the “Statement”), prepared on the basis of the Company’s allocation of the purchase price, is provided in lieu of certain historical financial information of PES required by Rule 3-05 of SEC Regulation S-X.
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.
Accounts Receivables and Allowance for Current Expected Credit Losses
Accounts 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.
At July 1, 2026, approximately 100% of the Company’s accounts receivable were from two customers.
Prepaid Expenses and Other Current Assets
Prepaid expenses include amounts paid in advance for rent, subscriptions, and contracts whose term exceeds three months and deferred expenses. Prepaid expenses are initially recorded as a current asset and amortized to expense over the period the goods or services are consumed. Other current assets include items such as advances to vendors and deposits.
| 4 |
Property and Equipment
Property and equipment are carried at cost. Any self-constructed property and equipment is recorded at the total cost of the materials plus a standard cost for labor and overhead. Depreciation of property and equipment is determined using the double declining balance method for financial statement purposes at rates based on an estimated useful life of 5 years for all assets.
Contracts
The Company’s revenue is derived from contracts with customers. 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.
The Company’s revenue from 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.
As
of July 1, 2026, the Company had
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 has a single lease for approximately 10,438 square feet of office and warehouse space in Fort Wayne, Indiana. The weighted remaining term of our operating leases was approximately 3.5 years at June 30, 2026. The discount rate used to measure lease liabilities was approximately 4.43% at June 30, 2026. 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 also made the accounting policy decision not to recognize lease assets and liabilities for leases with a term of 12 months or less.
| 5 |
A reconciliation of undiscounted cash flows to operating lease liabilities recognized in the assets acquired and liabilities assumed at June 30, 2026, is set forth below:
| Years ending December 31, | Operating Leases | |||
| Remainder of 2026 | $ | 31,575 | ||
| 2027 | 63,150 | |||
| 2028 | 63,150 | |||
| 2029 | 63,150 | |||
| 2030 and thereafter | - | |||
| Undiscounted lease payments | 221,025 | |||
| Amount representing interest | (16,632 | ) | ||
| Discounted lease payments | 204,393 | |||
| Less short-term lease liabilities | 55,207 | |||
| Long-term lease liabilities | $ | 149,186 | ||
Note 3 – Contingent Consideration and Earnout Arrangements
In connection with the acquisition of PES, completed on July 1, 2026, the Company may be obligated to issue additional consideration in the form of cash (the “Earnout Consideration”), contingent upon the achievement of financial performance milestones during defined measurement periods (collectively, the “Earnout Periods”). The Earnout Consideration is structured in three potential tranches.
First Earnout Tranche
If Year 1 Gross Profit of the Buyer is equal to or greater than Three Million and 00/100 Dollars ($3,000,000.00), then Seller shall earn earnout consideration (“First Earnout Consideration”) equal to the following amounts based on the amount of Year 1 Gross Profit of the Buyer, as listed below:
| (A) | If Year 1 Gross Profit is less than $2,550,000.00, the First Earnout Consideration shall be Zero and 00/100 Dollars ($0.00); |
| (B) | If Year 1Gross Profit is greater than or equal to $2,550,000.00 and less than or equal to $2,700,000.00, the First Earnout Consideration shall be One Hundred Sixty-Six Thousand Six Hundred Seven and 00/100 Dollars ($166,667.00); |
| (C) | If Year 1 Gross Profit is greater than $2,700,000.00 and less than or equal to $3,000,000.00, the First Earnout Consideration shall be Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00); |
| (D) | If Year 1 Gross Profit is greater than $3,000,000.00 and less than or equal to $3,150,000.00, the First Earnout Consideration shall be Three Hundred Thirty-Three Thousand Three Hundred Thirty-Three and 33/100 Dollars ($333,333.33); |
| (E) | If Year 1 Gross Profit is greater than $3,150,000.00 and less than or equal to $3,300,000.00, the First Earnout Consideration shall be Four Hundred Sixteen Thousand Six Hundred Sixty-Seven and 00/100 Dollars ($416,667.00); |
| (F) | If Year 1 Gross Profit is greater than $3,300,000.00 and less than or equal to $3,450,000.00, the First Earnout Consideration shall be Five Hundred Thousand and 00/100 Dollars ($500,000.00); or |
| (G) | If Year 1 Gross Profit is greater than $3,450,000.00, the First Earnout Consideration shall be Five Hundred Eighty-Three Thousand Three Hundred Thirty-Three and 00/100 Dollars ($583,333.00). |
Notwithstanding anything to the contrary herein, in no event shall the First Earnout Consideration exceed Five Hundred Eighty-Three Thousand Three Hundred Thirty-Three and 00/100 Dollars ($583,333.00). Further notwithstanding anything to the contrary herein, no portion of the First Earnout Consideration shall be earned if the Year 1 Gross Profit of the Buyer is less than Two Million Five Hundred Fifty Thousand and 00/100 Dollars ($2,550,000.00).
| 6 |
If any portion of the First Earnout Consideration is earned, then the Buyer shall make payment to the Seller of such amount in the form of a cash payment within sixty (60) days of the date that such amount is finally determined, to an account designated in writing by the Seller; provided, however, that, at Seller’s written direction, Buyer may remit all or any portion of such payment directly to Shareholder or an account designated by Shareholder as an administrative convenience, and any such payment shall be deemed made to Seller and shall satisfy Buyer’s payment obligation with respect thereto.
Second Earnout Tranche
If Year 2 Gross Profit of the Buyer is equal to or greater than Three Million Six Hundred Thousand and 00/100 Dollars ($3,600,000.00), then Seller shall earn earnout consideration (“Second Earnout Consideration”) equal to the following amounts based on the amount of Year 2 Gross Profit of the Buyer, as listed below:
| (A) | If Year 2 Gross Profit is less than $3,006,000.00, the Second Earnout Consideration shall be Zero and 00/100 Dollars ($0.00); |
| (B) | If Year2Gross Profit is greater than or equal to $3,006,000.00 and less than or equal to $3,240,000.00, the Second Earnout Consideration shall be One Hundred Sixty-Six Thousand Six Hundred Seven and 00/100 Dollars ($166,667.00); |
| (C) | If Year 2 Gross Profit is greater than $3,240,000.00 and less than or equal to $3,600,000.00, the Second Earnout Consideration shall be Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00); |
| (D) | If Year 2 Gross Profit is greater than $3,600,000.00 and less than or equal to $3,780,000.00, the Second Earnout Consideration shall be Three Hundred Thirty-Three Thousand Three Hundred Thirty-Three and 33/100 Dollars ($333,333.33); |
| (E) | If Year 2 Gross Profit is greater than $3,780,000.00 and less than or equal to $3,960,000.00, the Second Earnout Consideration shall be Four Hundred Sixteen Thousand Six Hundred Sixty-Seven and 00/100 Dollars ($416,667.00); |
| (F) | If Year 2 Gross Profit is greater than $3,960,000.00 and less than or equal to $4,140,000.00, the Second Earnout Consideration shall be Five Hundred Thousand and 00/100 Dollars ($500,000.00); or |
| (G) | If Year 2 Gross Profit is greater than $4,140,000.00, the Second Earnout Consideration shall be Five Hundred Eighty-Three Thousand Three Hundred Thirty-Three and 00/100 Dollars ($583,333.00). |
Notwithstanding anything to the contrary herein, in no event shall the Second Earnout Consideration exceed Five Hundred Eighty-Three Thousand Three Hundred Thirty-Three and 00/100 Dollars ($583,333.00). Further notwithstanding anything to the contrary herein, no portion of the Second Earnout Consideration shall be earned if the Year 2 Gross Profit of the Buyer is less than Four Million One Hundred Forty Thousand and 00/100 Dollars ($4,140,000.00).
Payment of Second Earnout Consideration. If any portion of the Second Earnout Consideration is earned, then the Buyer shall make payment to the Seller of such amount in the form of a cash payment within sixty (60) days of the date that such amount is finally determined, to an account designated in writing by the Seller; provided, however, that, at Seller’s written direction, Buyer may remit all or any portion of such payment directly to Shareholder or an account designated by Shareholder as an administrative convenience, and any such payment shall be deemed made to Seller and shall satisfy Buyer’s payment obligation with respect thereto.
| 7 |
Third Earnout Tranche
If Year 3 Gross Profit of the Buyer is equal to or greater than Four Million Two Hundred Thousand and 00/100 Dollars ($4,200,000.00), then Seller shall earn earnout consideration (“Third Earnout Consideration” and collectively with the First Earnout Consideration and Second Earnout Consideration, the “Earnout Consideration”) equal to the following amounts based on the amount of Year 3 Gross Profit of the Buyer, as listed below:
| (A) | If Year 3 Gross Profit is less than $3,570,000.00, the Third Earnout Consideration shall be Zero and 00/100 Dollars ($0.00); |
| (B) | If Year 3 Gross Profit is greater than or equal to |
| (C) | $3,570,000.00 and less than or equal to $3,780,000.00, the Third Earnout Consideration shall be One Hundred Sixty-Six Thousand Six Hundred Seven and 00/100 Dollars ($166,667.00); |
| (D) | If Year 3 Gross Profit is greater than $3,780,000.00 and less than or equal to $4,200,000.00, the Third Earnout Consideration shall be Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00); |
| (E) | If Year 3 Gross Profit is greater than $4,200,000.00 and less than or equal to $4,410,000.00, the Third Earnout Consideration shall be Three Hundred Thirty-Three Thousand Three Hundred Thirty-Three and 33/100 Dollars ($333,333.33); |
| (F) | If Year 3 Gross Profit is greater than $4,410,000.00 and less than or equal to $4,620,000.00, the Third Earnout Consideration shall be Four Hundred Sixteen Thousand Six Hundred Sixty-Seven and 00/100 Dollars ($416,667.00); |
| (G) | If Year 3 Gross Profit is greater than $4,620,000.00 and less than or equal to $4,830,000.00, the Third Earnout Consideration shall be Five Hundred Thousand and 00/100 Dollars ($500,000.00); or |
| (H) | If Year 3 Gross Profit is greater than $4,830,000.00, the Third Earnout Consideration shall be Five Hundred Eighty-Three Thousand Three Hundred Thirty-Three and 00/100 Dollars ($583,333.00). |
Notwithstanding anything to the contrary herein, in no event shall the Third Earnout Consideration exceed Five Hundred Eighty-Three Thousand Three Hundred Thirty-Three and 00/100 Dollars ($583,333.00). Further notwithstanding anything to the contrary herein, no portion of the Third Earnout Consideration shall be earned if the Year 3 Gross Profit of the Buyer is less than Four Million Eight Hundred Thirty Thousand and 00/100 Dollars ($4,830,000.00).
Payment of Third Earnout Consideration. If any portion of the Third Earnout Consideration is earned, then the Buyer shall make payment to the Seller of such amount in the form of a cash payment within sixty (60) days of the date, to an account designated in writing by the Seller; provided, however, that, at Seller’s written direction, Buyer may remit all or any portion of such payment directly to Shareholder or an account designated by Shareholder as an administrative convenience, and any such payment shall be deemed made to Seller and shall satisfy Buyer’s payment obligation with respect thereto.
| 8 |
Exhibit 99.2
Unaudited Proforma Combined Financial Information
The following unaudited proforma combined balance sheet of Cemtrex, Inc. (“the Company”) for the interim period ended June 30, 2026, is presented as if the acquisition of Plant Engineering Services, Inc. (“PES”) referred to herein as the “Acquisition” had occurred on June 30, 2026.
The accompanying unaudited proforma combined balance sheet is based on the historical balance sheet of the Company after giving proforma effect to the Company’s acquisition of PES and its related assets, liabilities and personnel and gives effect to: (i) the cash used to fund consideration and (ii) the acquisition of PES. The consideration and the acquisition of PES are hereby referred to as the “Transaction”.
The unaudited proforma combined balance sheet has been derived from and should be read in conjunction with the Company’s historical unaudited consolidated balance sheet. The financial statements of the Company for the period ended June 30, 2026, are included in the Company’s Quarterly Report on Form 10-Q as filed with the Securities and Exchange Commission on August 14, 2026.
The unaudited proforma combined balance sheet includes unaudited proforma adjustments that are factually supportable and directly attributed to the Acquisition. The unaudited proforma adjustments are expected to have a continuing impact on the consolidated results. Assumptions underlying the proforma adjustments are described in the accompanying notes, which should be read in conjunction with the unaudited proforma combined balance sheet.
The unaudited proforma adjustments are based upon available information and certain assumptions that the Company’s management believe are reasonable. The unaudited proforma combined balance sheet is presented for informational purposes only and are not necessarily indicative of the Company’s financial position.
The Company’s management expects that the strategic and financial benefits of the acquisition of PES will result in certain cost saving opportunities, which have not been reflected in the accompanying unaudited proforma combined balance sheet.
The
acquisition of PES will be accounted for as a business combination using the acquisition method of accounting in accordance with Accounting
Standards Codification Topic 805, Business Combinations, which will establish a new basis of accounting for all identifiable assets acquired
and liabilities assumed at fair value as of the date control is obtained. Accordingly, the consideration transferred will be allocated
to the underlying net assets in proportion to their respective fair values. The fair value of PES’ identifiable tangible and intangible
assets acquired and liabilities assumed are based on a preliminary estimate of fair value. Any excess of the purchase price over the
estimated fair values of the net assets acquired will be recorded as goodwill. The allocation of the purchase price to acquired assets
and assumed liabilities based on their underlying fair values requires the extensive use of significant estimates and the Company’s
judgment. The Company’s management believes the fair values recognized for the acquired assets and assumed liabilities are based
on reasonable estimates and assumptions based on information currently available. All assets acquired and liabilities assumed have been
recognized at their respective book values, which the Company’s management believes materially approximate their respective fair
values. The excess of estimated purchase price over the estimated fair value of the net assets acquired of
The unaudited proforma combined balance sheet should be read in conjunction with the following information:
| ● | The notes to the unaudited proforma combined balance sheet. |
| ● | The Company’s unaudited consolidated financial statements as of and for the fiscal period ended June 30, 2026, which are included in the Company’s Quarterly Report on Form 10-Q as of and for the quarter ended June 30, 2026. |
| ● | The audited assets acquired and liabilities assumed of PES as of July 1, 2026, which is included in Exhibit 99.1 herein; and |
Proforma Combined Balance Sheets
June 30, 2026
Unaudited
| PES | ||||||||||||||||||
| Assets | ||||||||||||||||||
| Cemtrex Inc. | Acquired & Liabilities Assumed | Pro Forma Adjustments | ||||||||||||||||
| June 30, 2026 | June 30, 2026 | Acquisition | Notes | Pro Forma Combined | ||||||||||||||
| Assets | ||||||||||||||||||
| Current assets | ||||||||||||||||||
| Cash and cash equivalents | $ | 7,972,128 | (2,711,393 | ) | 4(a) | $ | 5,260,735 | |||||||||||
| Restricted cash | 1,329,612 | 1,329,612 | ||||||||||||||||
| Marketable securities | 3,701,907 | 3,701,907 | ||||||||||||||||
| Trade receivables, net | 12,520,180 | 141,367 | 12,661,547 | |||||||||||||||
| Trade receivables, net - related party | 436,453 | 436,453 | ||||||||||||||||
| Inventory, net | 8,035,295 | 8,035,295 | ||||||||||||||||
| Contract assets, net | 1,659,157 | 1,659,157 | ||||||||||||||||
| Prepaid expenses and other current assets | 1,847,892 | 38,994 | 1,886,886 | |||||||||||||||
| Total current assets | 37,502,624 | 180,361 | (2,711,393 | ) | 34,971,592 | |||||||||||||
| Property and equipment, net | 16,612,511 | 24,812 | 93,485 | 4(b) | 16,730,808 | |||||||||||||
| Right-of-use operating lease assets | 2,750,789 | 204,393 | ||||||||||||||||
| Right-of-use financing lease assets | 38,010 | 38,010 | ||||||||||||||||
| Digital assets | 970,519 | 970,519 | ||||||||||||||||
| Goodwill | 7,686,141 | 4(a) | ||||||||||||||||
| Intangible assets, net of amortization | 2,833,500 | |||||||||||||||||
| Other | 1,611,263 | 1,611,263 | ||||||||||||||||
| Total Assets | $ | 70,005,357 | $ | 409,566 | $ | |||||||||||||
| Liabilities & Stockholders’ Equity | ||||||||||||||||||
| Current liabilities | ||||||||||||||||||
| Accounts payable | 4,877,828 | 155,009 | 5,032,837 | |||||||||||||||
| Sales tax payable | 60,056 | 60,056 | ||||||||||||||||
| Revolving line of credit | 2,392,830 | 2,392,830 | ||||||||||||||||
| Current maturities of long-term liabilities | 8,055,879 | 8,055,879 | ||||||||||||||||
| Operating lease liabilities - short-term | 1,213,307 | 55,207 | ||||||||||||||||
| Financing lease liabilities - short-term | 312,560 | 312,560 | ||||||||||||||||
| Deposits from customers | 569,933 | 569,933 | ||||||||||||||||
| Accrued expenses | 2,295,479 | 859,031 | 4(a) | 3,154,510 | ||||||||||||||
| Accrued payable on inventory in transit | 756,241 | 756,241 | ||||||||||||||||
| Contract liabilities | 2,520,458 | 2,396,007 | 4,916,465 | |||||||||||||||
| Deferred revenue | 838,154 | 838,154 | ||||||||||||||||
| Accrued income taxes | 454,510 | 454,510 | ||||||||||||||||
| Total current liabilities | 24,347,235 | 2,606,223 | ||||||||||||||||
| Long-term liabilities | ||||||||||||||||||
| Long-term debt | 8,577,988 | 8,577,988 | ||||||||||||||||
| Long-term operating lease liabilities | 1,585,473 | 149,186 | ||||||||||||||||
| Other long-term liabilities | 290,000 | 290,000 | ||||||||||||||||
| Deferred Revenue - long-term | 341,058 | 341,058 | ||||||||||||||||
| Warrant liabilities | 2,866,152 | 2,866,152 | ||||||||||||||||
| Total long-term liabilities | 13,660,671 | 149,186 | ||||||||||||||||
| Total liabilities | 38,007,906 | 2,755,409 | ||||||||||||||||
| Commitments and contingencies | - | - | - | - | ||||||||||||||
| Stockholders’ equity | ||||||||||||||||||
| Preferred stock , $0.001 par value, 10,000,000 shares authorized, | ||||||||||||||||||
| Series 1, 4,000,000 shares authorized, 2,983,141 shares issued and | ||||||||||||||||||
| 2,919,041 shares outstanding as of June 30, 2026 | ||||||||||||||||||
| (liquidation value of $10 per share) | 2,983 | 2,983 | ||||||||||||||||
| Series C, 100,000 shares authorized, 50,000 shares issued and outstanding at | ||||||||||||||||||
| June 30, 2026 | 50 | 50 | ||||||||||||||||
| Common stock, $0.001 par value, 70,000,000 shares authorized, 1,259,716 shares issued and outstanding at June 30, 2026 | 1,260 | 1,260 | ||||||||||||||||
| Additional paid-in capital | 153,092,747 | 153,092,747 | ||||||||||||||||
| (Accumulated deficit)/Retained earnings | (123,526,332 | ) | 4(c) | (123,526,332 | ) | |||||||||||||
| Treasury stock, 64,100 shares of Series 1 Preferred Stock at June 30, 2026 | (148,291 | ) | (148,291 | ) | ||||||||||||||
| Accumulated other comprehensive income | 2,575,034 | 2,575,034 | ||||||||||||||||
| Total Cemtrex stockholders’ equity | 31,997,451 | (2,345,843 | ) | 2,345,843 | 31,997,451 | |||||||||||||
| Total liabilities and shareholders’ equity | $ | 70,005,357 | $ | 409,566 | $ | |||||||||||||
Notes to the Unaudited Proforma Combined Balance sheet
Note 1 – Description of the Transaction
On July 1, 2026, the “Company, through its wholly owned subsidiary Advanced Industrial Services (“AIS”), completed the acquisition of substantially all of the assets of PES, Inc, an Indiana corporation pursuant to an Asset Purchase Agreement dated July 1, 2026 (the “Asset Purchase Agreement”) by and among AIS Engineering, Inc., a newly formed wholly owned subsidiary of AIS (“Buyer”), PES, and Mark Bohler, an individual residing in state of Indiana (“the “Owner” and collectively with the PES, the “Seller Parties”).
The total consideration given by Cemtrex to the seller of PES was approximately $2.7 million in cash and $0.86 million in contingent consideration. Cemtrex funded the transaction with cash.
Note 2 – Reclassifications
As part of the Company’s integration efforts, the Company will continue its process of evaluating whether there are any significant differences in accounting policies that would require adjustment or reclassification of PES’ results of operations in order to conform to the Company’s accounting policies and classifications. As a result of that ongoing evaluation, the Company may identify differences between the accounting policies of the two companies that, when conformed, could have a material impact on the unaudited proforma combined balance sheet.
During the preparation of the unaudited proforma combined balance sheet, the Company was not aware of any material differences between accounting policies of the two companies, except for certain reclassifications necessary to conform to the Company’s financial presentation, and accordingly, the unaudited proforma combined statement of operations does not assume any material differences in accounting policies between the two companies.
Note 3 – Fair Value of Assets Acquired, Liabilities Assumed and Calculation of Goodwill
The total purchase price has been allocated in the accompanying unaudited proforma combined balance sheet based on (i) the amounts reported in the historical statements of PES, or (ii) management’s preliminary estimates of fair value. The Company’s management reviewed various other asset allocations of similar market transactions and applied corresponding relative values of the intangibles compared to the purchase price. The estimated amortization periods are consistent with those used for similar market transactions and amortization is accounted for on a straight-line basis. The percentages assigned are an initial estimate and are subject to change once the detailed third-party purchase price accounting analysis is completed.
The proforma purchase price allocation presented below is still preliminary but has been developed based on an estimate of fair values of PES’ identifiable tangible and intangible assets acquired and liabilities assumed as of July 1, 2026. The final allocation of the purchase price will be determined within one year from the closing date of the PES acquisition. As such, the purchase price allocation may change, and such changes could result in a material change to the unaudited proforma combined balance sheet.
The preliminary allocation of PES’ tangible and intangible assets and liabilities under this methodology as if the acquisition on June 30, 2026, is as follows:
| Consideration Transferred: | ||||
| Cash | $ | 2,711,393 | ||
| Contingent consideration at fair market value | 859,031 | |||
| Total consideration transferred | $ | 3,570,424 | ||
| Purchase Price Allocation: | ||||
| Trade receivables, net | 141,367 | |||
| Prepaid expenses and other current assets | 38,994 | |||
| Property and equipment, net | 118,297 | |||
| Right-of-use operating lease assets | 192,223 | |||
| Accounts Payable | (155,009 | ) | ||
| Contract liabilities | (2,396,007 | ) | ||
| Operating lease liabilities | (192,223 | ) | ||
| Goodwill | ||||
| Total consideration transferred | $ | 3,570,424 | ||
Note 4 – Proforma Adjustments
The proforma adjustments included in the accompanying information do not reflect the final Acquisition purchase consideration. The allocation of consideration to the various tangible and intangible assets acquired and liabilities assumed is preliminary and subject to change. This note should be read in conjunction with “Note 1 – Description of The Transactions and “Note 2 – Reclassifications.” Adjustments included in the column “Acquisition” to the accompanying unaudited proforma combined balance sheet as of June 30, 2026:
Unaudited Proforma Combined Balance Sheet
(a) Purchase Price Allocation
To
reflect the consideration of $2,711,393 cash and
(b) Fair Market Valuation
To
reflect the
(c) Elimination of Equity Balances
To reflect the elimination of PES’ equity balances in combination.