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Stockholders' Equity
6 Months Ended
Mar. 31, 2019
Equity [Abstract]  
Stockholders' Equity

NOTE 16 – STOCKHOLDERS’ EQUITY

 

Preferred Stock

 

The Company is authorized to issue 10,000,000 shares of Preferred Stock, $0.001 par value. As of March 31, 2019, and September 30, 2018, there were 3,010,996 and 2,914,168 shares issued and outstanding, respectively.

 

Series 1 Preferred Stock

 

For the six months ended March 31, 2019, 95,778 shares of Series 1 Preferred Stock were issued to pay $957,780 worth of dividends to holders of Series 1 Preferred Stock.

 

As of March 31, 2019, and September 30, 2018, there were 2,009,946 and 1,914,168 shares of Series 1 Preferred Stock issued and outstanding, respectively.

 

Series A Preferred stock

 

During the six-month periods ended March 31, 2019 and 2018, the Company did not issue any Series A Preferred Stock.

 

As of March 31, 2019, and September 30, 2018, there were 1,000,000 shares of Series A Preferred Stock issued and outstanding.

 

Common Stock

 

The Company is authorized to issue 20,000,000 shares of common stock, $0.001 par value. As of March 31, 2019, there were 14,487,284 shares issued and outstanding and at September 30, 2018, there were 12,973,730 shares issued and outstanding.

 

During the six months ended March 31, 2019, 1,152,912 shares of the Company’s common stock have been issued to satisfy $775,000 of a short-term note payable, 201,002 shares were issued in a Subscription Rights Offering(See below), 500,000 shares were issued and held in trust in an At-the-Market Offering Agreement(See below), and 20,000 were issued in a Securities Purchase Agreement(See below).

 

Subscription Rights Offering

 

On November 26, 2018, Cemtrex, Inc. (the “Company”) commenced a rights offering to its stockholders (“Rights Offering”). Pursuant to the Rights Offering, the Company has distributed, at no charge to holders of record of the Company’s common stock and series 1 warrants as of November 19, 2018 (the “Record Date”), non-transferable subscription rights to purchase up to an aggregate of $2,700,000 worth of shares of common stock, at a purchase price equal to the lesser of (i) $1.06 per share (in which case 2,547,170 shares may be sold), or (ii) 95% of the volume weighted average price of the Company’s common stock for the five trading day period through and including December 19, 2018, which is the initial expiration date of the Rights Offering, all as set forth in the Prospectus Supplement filed on November 21, 2018 with the Securities and Exchange Commission (the “Prospectus Supplement”). On December 19, 2018 the price was set at $0.75 per share and the expiration date was extended to December 21, 2018. Each stockholder of record on the Record Date received one right for each one share of common stock held by the stockholder, and each series 1 warrant holder of record on the Record Date received one right for every ten shares for which their warrant is exercisable. Each right entitles the holder to purchase one share of the Company’s common stock, subject to proration. In connection with the Rights Offering, the Company entered into a Dealer-Manager Agreement (the “Agreement”) with Advisory Group Equity Services, Ltd. Doing business as RHK Capital (“RHK”). As of March 31, 2019, 201,002 shares of common stock were issued for gross proceeds of $150,721. After deducting offering expenses of $12,027 the Company received $138,694 in net proceeds.

 

At-the-Market Offering Agreement

 

On January 28, 2019,the “Company entered into an At-the-Market Offering Agreement (the “Agreement”) with Advisory Group Equity Services, Ltd. Doing business as RHK Capital (the “Manager”), pursuant to which the Manager will act as the Company’s sales agent with respect to the issuance and sale of up to $2,000,000 of the Company’s shares of common stock, par value $0.001 per share (the “Shares”), from time to time in an at-the-market public offering (the “Offering”). The proceeds were used to fund operations.

 

Sales of the Shares, through the Manager, will be made directly on The NASDAQ Capital Market, on any other existing trading market for our common stock or to or through a market maker. The Manager may also sell the Shares in privately negotiated transactions, provided that the Manager receives our prior written approval for any sales in privately negotiated transactions. The Company will pay the Manager a commission equal to 3.0% of the gross proceeds from the sale of the Shares pursuant to the Sales Agreement. As of March 31, 2019, 500,000 shares of common stock were issued and held in trust. Of the shares held in trust, 276,372 were issued for gross proceeds of $209,974. After deducting offering expenses of $6,296 the Company received $203,679 in net proceeds. The proceeds were used to fund operations.