AIRI Air Industries Group

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

 

Date of Report (date of earliest event reported): January 31, 2025

 

AIR INDUSTRIES GROUP

(Exact Name of Registrant as Specified in its Charter)

 

Nevada		001-35927		80-0948413
State of Incorporation		Commission File Number		IRS Employer I.D. Number

 

1460 Fifth Avenue, Bay Shore, New York 11706

(Address of Principal Executive Offices)

 

Registrant’s telephone number: (631) 968-5000

 

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 (see General Instruction A.2. below):

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 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))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001		AIRI		NYSE American

 

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. ☐

 

 

 

Item 1.01 Entry Into a Definitive Material Agreement.

 

On January 31, 2025, we, Air Industries Group, entered into the Eighth Amendment to Loan and Security Agreement with Webster Bank (“Eighth Amendment”). In the Eighth Amendment Webster Bank relaxed the financial covenants in the agreement, permitted the repayment of our subordinated debt, and expanded our Term Loan by approximately $1.6 million. These funds will be used for the purchase of new state of the art machinery, costing approximately $1.9 million. This investment in production equipment will support the recently announced $33 million contract and will greatly increase throughput. A copy of the Eighth Amendment is annexed to this Report as Exhibit 10.1 and reference is made thereto for the complete terms and conditions of the Eighth Amendment.

 

Item 7.01 Regulation FD Disclosure.

 

On February 3, 2025 Air Industries Group issued a press release announcing that it had reached an agreement with Webster Bank, its primary lender, to amend the Company’s Credit Facility. A copy of the press release is annexed as Exhibit 99.1 to this Report.

 

The information contained in Item 7.01 in this Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed as “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liability of such Section, nor shall it be deemed incorporated by reference in any filing by us under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference in such filing.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.		Description
10.1		Eighth Amendment to Loan and Security Agreement with Webster Bank, National Association
99.1		Press Release issued by Air Industries Group on February 3, 2025
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

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.

 

Dated: February 3, 2025

 

	AIR INDUSTRIES GROUP
	By:	/s/ Scott Glassman
		Scott Glassman
		Chief Financial Officer

 

 

2

Exhibit 10.1

 

Execution version

 

EIGHTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

 

This eighth Amendment TO LOAN AND SECURITY AGREEMENT (the “Amendment”), is dated January 30, 2025, and is made by and among (a) AIR INDUSTRIES MACHINING, CORP., a New York corporation (“AIM”), NASSAU TOOL WORKS, INC., a New York corporation (“NTW”), THE STERLING ENGINEERING CORPORATION, a Connecticut corporation (“Engineering”, and together with AIM and NTW, individually a “Borrower”, and collectively the “Borrowers”), (b) AIR INDUSTRIES GROUP, a Nevada corporation (together with its successors and permitted assigns, “Parent”), and AIR REALTY GROUP, LLC, a Connecticut limited liability company (“Realty”, and together with Parent, the “Guarantor”) and WEBSTER BANK, NATIONAL ASSOCIATION, a national banking association (successor by merger to Sterling National Bank), (together with its successors and permitted assigns, the “Lender”).

 

Recitals

 

Pursuant to that certain Loan and Security Agreement, dated as of December 31, 2019, as amended (the “Loan Agreement”) by and among Borrowers, Guarantor, the other Credit Parties thereto, and Lender, Lender has agreed to make certain financial accommodations available to Borrowers from time to time pursuant to the terms and conditions thereof (capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Loan Agreement, as amended hereby).

 

The Credit Parties have requested that Lender agree to make certain amendments to the Loan Agreement.

 

NOW, THEREFORE, in consideration of the premises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:

 

1. Amendments to Loan Agreement. As of the effective date of this Amendment, the Loan Agreement is amended as follows:

 

(a) Section 1.1. Section 1.1 of the Loan Agreement is hereby amended by the addition, in alphabetical order, or the amendment and restatement, as applicable, of each of the following definitions, to read in their entirety as follows:

 

“ATM Proceeds” means the cash proceeds received by Parent from the issuance of common stock through an At-The Market offering described in the Form S-3 Registration statement filed by Parent with the United States Securities and Exchange Commission on or about December 13, 2024.

 

“Eighth Amendment Effective Date” means January 30, 2025.

 

“Fixed Charge Coverage Ratio” means, for a Person on any date of determination, the ratio of (a) EBITDA less unfinanced Capital Expenditures to (b) (i) taxes paid in cash, plus (ii) to the extent Distributions have not been reflected in net income, Distributions that are made by Parent (provided that Distributions by Parent are not permitted without Lender’s prior written consent, which consent may be granted or withheld in Lender’s sole and absolute discretion), plus, (iii) Interest Expense paid in cash, plus (iv) principal payments made or required to be made on any and all long term Debt (other than in respect of the Revolving Loans prior to the Maturity Date and other than principal payments made from proceeds of ATM Proceeds during such period, so long as such payment are Permitted Subordinated Indebtedness Payments), in each case determined for such Person and its Subsidiaries on a consolidated basis in accordance with GAAP on a rolling twelve month basis, on such date of determination.

 

 

“Installment Payment Date” means the first day of each calendar month, commencing on the date described in Section 4.3, and continuing on the same day of each calendar month thereafter until the earlier of the Termination Date or the date on which the Term Loan or Term Loan Cap Ex Advance, as applicable has been irrevocably paid in full.

 

“Permitted Subordinated Indebtedness Payments” shall have the meaning set forth in that certain Subordination Agreement dated as of December 31, 2019, as amended by Amendment No. 1 to Subordination Agreement dated December 7, 2021 and by Amendment No. 2 to Subordination Agreement dated as of the Eighth Amendment Effective Date, all by and among Lender and Taglich Brothers Inc., Michael N. Taglich, Michael N. Taglich & Claudia Taglich JTWROS, and Robert F. Taglich as subordinated creditors.

 

“Term Cap Ex Commitment” means $1,640,000.

 

“Term Cap Ex Commitment Period” means the period from the Eighth Amendment Effective Date through January 31, 2025.

 

(b) Section 4.2(b). Section 4.2(b) of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

 

(b) For so long as the Term Loan and the Term Cap Ex Loan remain outstanding, if Excess Cash Flow for any Fiscal Year of Parent and its consolidated subsidiaries is a positive number, beginning with the Fiscal Year ending December 31, 2020, Borrowers shall pay to Lender, for application to the Term Loan and the Term Cap Ex Loan on a pro rata basis, an amount equal to the lesser of (i) twenty-five percent (25%) of the Excess Cash Flow for such Fiscal Year and (ii) the outstanding principal balance of the Term Loan and the Term Cap Ex Loan. Such payment shall be made to Lender and applied to the outstanding principal balance of the Term Loan and Term Cap Ex Loan, on or prior to April 15 of the Fiscal Year immediately following such Fiscal Year.

 

(c) Section 4.3. Section 4.3(a) and Section 4.3(b) of the Loan Agreement are hereby amended and restated in their entirety read as follows:

 

(a) The principal of the Term Loan shall be payable to Lender in equal monthly installments on each Installment Payment Date occurring after the Seventh Amendment Effective Date, each in an amount equal to $67,857.15 (plus interest payable pursuant to Section 4.1).

 

(b) The principal of the Term Cap Ex Loan Advance shall be payable to Lender in equal monthly installments on each Installment Payment Date occurring after the Eighth Amendment Effective Date, each in an amount equal to $19,523.81 (plus interest payable pursuant to Section 4.1).

 

 

(d) Section 9.3. Section 9.3(c) of the Loan Agreement is hereby amended and restated in its entirety as follows:

 

(c) on the Agreement Date and thereafter, (i) for working capital in the ordinary course of Borrowers’ business, and (ii) with regard to proceeds of the Term Cap Ex Loan, to finance Eligible Equipment (other than Term Loan Primary Collateral) purchased by (or otherwise being funded through reimbursement to) Borrowers on or about the Eighth Amendment Effective Date, and (iii) with regard to proceeds of the Term Loan, to finance or refinance Eligible Equipment (other than Term Cap Ex Loan Primary Collateral) on or prior to the Seventh Amendment Effective Date.

 

(e) Section 9.14(a). Section 9.14(a) of the Loan Agreement is hereby amended and restated in its entirety as follows:

 

(a) The Fixed Charge Coverage Ratio for Parent and its consolidated Subsidiaries for any Fiscal Quarter of Parent, determined as of the last day of such Fiscal Quarter, shall not be less than (i) 1.05 to 1.00 for the Fiscal Quarter ending March 31, 2025, (ii) 1.05 to 1.00 for the Fiscal Quarter ending June 30, 2025, and (iii) 1.25 to 1.00 for all other Fiscal Quarters.

 

(f) Schedule 1.2. Schedule 1.2 of the Loan Agreement is hereby amended and restated by Schedule 1.2 attached to this Amendment.

 

2. No Other Changes. Except as explicitly amended by this Amendment, all of the terms and conditions of the Loan Agreement shall remain in full force and effect and shall apply to any Loan made thereunder.

 

3. Amendment Fee. In consideration of Lender’s agreement to enter into this Amendment, Borrowers shall pay to Lender a non-refundable amendment fee in an amount equal to $20,000 which amendment fee has been fully earned as of the effective date of this Amendment, and which shall be payable at the execution and delivery of this Amendment.

 

4. Conditions Precedent. This Amendment shall be effective on the date (such date, the “Eighth Amendment Effective Date”) that each of the following conditions have been satisfied, in form and substance satisfactory to Lender:

 

(a) The Lender shall have received a fully executed copy of this Amendment;

 

(b) The Lender shall have received a Term Loan Cap Ex Note in the original principal amount of $1,640,000, payable to Lender and properly executed by Borrowers;

 

(c) Evidence, in form and substance acceptable to Lender, that the Eligible Equipment financed with proceeds of the Term Cap Ex Advance has been purchased by a Borrower together with copies of all invoices relating to such Eligible Equipment.

 

(d) The Lender shall have received a copy of the resolutions or equivalent action, in form and substance reasonably satisfactory to the Lender, of the Board of Directors or equivalent authorizing body of each Borrower authorizing, as applicable, the execution, delivery of this Amendment and the performance of this Amendment, certified by the Secretary, an Assistant Secretary or other authorized representatives of each Borrower as of the Eighth Amendment Effective Date, which certificate shall state that the resolutions or other action hereby certified have not been amended, modified (except as any later such resolution or other action may modify any earlier such resolution or other action), revoked or rescinded and are in full force and effect; and

 

 

(e) The Lender shall have received the amendment fee set forth in Section 3 above and Borrowers shall have paid or cause to be paid all fees and expenses required to be paid in accordance with this Amendment.

 

5. Representations and Warranties. Borrowers hereby represent and warrant to Lender as follows:

 

(a) Each Borrower has all requisite power and authority to execute this Amendment and any other agreements or instruments required hereunder and to perform all of its obligations hereunder, and this Amendment and all such other agreements and instruments have been duly executed and delivered by each Borrower and constitute the legal, valid and binding obligation of Borrowers, enforceable in accordance with its terms.

 

(b) The execution, delivery and performance by each Borrower of this Amendment and any other agreements or instruments required hereunder have been duly authorized by all necessary corporate action and do not (i) require any authorization, consent or approval by any governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) violate any provision of any law, rule or regulation or of any order, writ, injunction or decree presently in effect, having applicability to any Borrower, or the certificate of formation, articles of incorporation, operating agreement, or by-laws of any Borrower, or (iii) result in a breach of or constitute a default under any indenture or loan or credit agreement or any other agreement, lease or instrument to which any Borrower is a party or by which it or its properties may be bound or affected.

 

(c) All of the representations and warranties contained in the Loan Agreement are correct on and as of the date hereof as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date.

 

(d) After giving effect to this Amendment and the transactions contemplated hereby, no Default or Event of Default has occurred and is continuing.

 

6. References. All references in the Loan Agreement to “this Agreement” shall be deemed to refer to the Loan Agreement as amended hereby; and any and all references in the Loan Documents to the Loan Agreement shall be deemed to refer to the Loan Agreement as amended hereby.

 

7. No Waiver. The execution of this Amendment and the acceptance of all other agreements and instruments related hereto shall not be deemed to be a waiver of any Default or Event of Default under the Loan Agreement or a waiver of any breach, default or event of default under any Loan Document or other document held by Lender, whether or not known to Lender and whether or not existing on the date of this Amendment.

 

8. Release. Borrowers hereby absolutely and unconditionally release and forever discharge Lender, and any and all participants, parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents and employees of any of the foregoing, from any and all claims, demands or causes of action of any kind, nature or description, whether arising in law or equity or upon contract or tort or under any state or federal law or otherwise, any Borrower has had, now has or has made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever relating to any Loan Document arising from the beginning of time to and including the date of this Amendment, whether such claims, demands and causes of action are matured or unmatured or known or unknown.

 

 

9. Costs and Expenses. Borrowers hereby reaffirms their agreement under the Loan Agreement to pay or reimburse Lender on demand for all costs and expenses incurred by Lender in connection with the Loan Documents, including without limitation all reasonable fees and disbursements of legal counsel. Without limiting the generality of the foregoing, Borrowers specifically agree to pay all fees and disbursements of counsel to Lender for the services performed by such counsel in connection with the preparation of this Amendment and the documents and instruments incidental hereto. Borrowers hereby agree that Lender may, at any time or from time to time in its sole discretion and without further authorization by Borrowers, make a loan to the Borrowers under the Loan Agreement, or apply the proceeds of any loan, for the purpose of paying any such fees, disbursements, and costs and expenses.

 

10. Counterparts. This Amendment may be executed by means of (a) an electronic signature that complies with the federal Electronic Signatures in Global and National Commerce Act, state enactments of the Uniform Electronic Transactions Act, or any other relevant and applicable electronic signatures law; (b) an original manual signature; or (c) a faxed, scanned, or photocopied manual signature. Each electronic signature or faxed, scanned, or photocopied manual signature shall for all purposes have the same validity, legal effect, and admissibility in evidence as an original manual signature. This Amendment may be executed in any number of counterparts, each of which shall be deemed to be an original, but such counterparts shall, together, constitute only one instrument. Delivery of an executed counterpart of a signature page of this Amendment will be as effective as delivery of a manually executed counterpart of the Agreement.

 

11. Headings. Section Headings are for convenience of reference only, and are not part of, and are not to be taken into consideration in interpreting this Amendment.

 

12. Governing Law. The rights and obligations hereunder of each of the parties hereto shall be governed by and interpreted and determined in accordance with the laws of the State of New York.

 

[Signature pages follow]

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first written above.

 

BORROWERS:	AIR INDUSTRIES MACHINING, CORP.
	By:	/s/ Scott Glassman
	Name	Scott Glassman
	Title:	Chief Financial Officer
	NASSAU TOOL WORKS, INC.
	By:	/s/ Scott Glassman
	Name	Scott Glassman
	Title:	Chief Financial Officer
	THE STERLING ENGINEERING CORPORATION
	By:	/s/ Scott Glassman
	Name	Scott Glassman
	Title:	Chief Financial Officer
GUARANTORS:	AIR INDUSTRIES GROUP
	By:	/s/ Scott Glassman
	Name	Scott Glassman
	Title:	Chief Financial Officer
	AIR REALTY GROUP, LLC
	By:	/s/ Scott Glassman
	Name	Scott Glassman
	Title:	Chief Financial Officer

 

[Signature Page to Eighth Amendment to Loan and Security Agreement (Air Industries)]

 

 

	WEBSTER BANK, NATIONAL ASSOCIATION,
	as Lender
	By:	/s/ Gordon Massave
	Name:	Gordon Massave
	Title:	Managing Director

 

[Signature Page to Eighth Amendment to Loan and Security Agreement (Air Industries)]

 

 

Schedule 1.2

 

Term Loan Primary Collateral

 

The Eligible Equipment of Borrowers described in the Appraisal with an effective date of February 9, 2024, issue date March 1, 2024, prepared for Webster Business Credit, a division of Webster Bank, N.A., by Tiger Valuation Services, LLC, so long as such items of Equipment shall, at all times, remain Eligible Equipment. For the avoidance of doubt, Term Loan Primary Collateral shall not include any Term Cap Ex Loan Primary Collateral.

 

[Signature Page to Eighth Amendment to Loan and Security Agreement (Air Industries)]

 

 

Exhibit 99.1

 

 

February 3, 2025 07:00 AM Eastern Standard Time

 

Air Industries Group Secures Expansion of

Term Loan from Webster Bank

 

BAY SHORE, N.Y. -- (BUSINESS WIRE) -- Air Industries Group (“Air Industries”) (NYSE American: AIRI), a leading manufacturer of precision components and assemblies for large aerospace and defense prime contractors, today announced that its primary lender, Webster Bank has amended the terms of its Credit Facility. Relaxing the required Covenants, permitting the repayment of Subordinated Debt, and expanding the Company’s Term Loan by approximately $1.6 million. These funds will be used for the purchase of new state of the art machinery, costing approximately $1.9 million. This investment in production equipment will support the recently announced $33 million contract and will greatly increase throughput.

 

Lou Melluzzo, Chief Executive Officer of Air Industries Group, commented: “Webster Bank has been our primary lender and a vital partner to Air Industries for five years. This increase in our equipment term loan facilitates the purchase of two new state of the art machines to expand the production of components for the CH-53K heavy lift helicopter. These new machines will duplicate an existing production cell, doubling the production capacity for these products.

 

“Our loan facility with Webster matures at the end of this year. Negotiations for an extension of the facility will begin in the second quarter, after the filing of our Form 10-K. Webster Bank has been a phenomenal partner to work with, and we have a high degree of confidence that we will be successful in extending the loan facility.”

 

ABOUT AIR INDUSTRIES GROUP

 

Air Industries Group is a leading manufacturer of precision components and assemblies for large aerospace and defense prime contractors. Its products include landing gears, flight controls, engine mounts and components for aircraft jet engines, ground turbines and other complex machines. Whether it is a small individual component or complete assembly, its high quality and extremely reliable products are used in mission critical operations that are essential for the safety of military personnel and civilians.

 

FORWARD LOOKING STATEMENTS

 

Certain matters discussed in this press release are ‘forward-looking statements’ intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. In particular, the Company’s statements regarding trends in the marketplace, future revenues, earnings and Adjusted EBITDA, the ability to realize firm backlog and projected backlog, cost cutting measures, potential future results and acquisitions, are examples of such forward-looking statements. The forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the timing of projects due to variability in size, scope and duration, the inherent discrepancy in actual results from estimates, projections and forecasts made by management, regulatory delays, changes in government funding and budgets, and other factors, including general economic conditions, not within the Company’s control. The factors discussed herein and expressed from time to time in the Company’s filings with the Securities and Exchange Commission could cause actual results and developments to be materially different from those expressed in or implied by such statements. The forward-looking statements are made only as of the date of this press release and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

 

NON-GAAP FINANCIAL MEASURES

 

The Company uses Adjusted EBITDA, a Non-GAAP financial measure as defined by the SEC, as a supplemental profitability measure because management finds it useful to understand and evaluate results, excluding the impact of non-cash depreciation and amortization charges, stock based compensation expenses, and nonrecurring expenses and outlays, prior to consideration of the impact of other potential sources and uses of cash, such as working capital items. This calculation may differ in method of calculation from similarly titled measures used by other companies and may be different than the EBITDA calculation used by our lenders for purposes of determining compliance with our financial covenants. This Non-GAAP measure may have limitations when understanding performance as it excludes the financial impact of transactions such as interest expense necessary to conduct the Company’s business and therefore are not intended to be an alternative to financial measure prepared in accordance with GAAP. The Company has not quantitatively reconciled its forward looking Adjusted EBITDA target to the most directly comparable GAAP measure because items such as amortization of stock-based compensation and interest expense, which are specific items that impact these measures, have not yet occurred, are out of the Company’s control, or cannot be predicted. For example, quantification of stock-based compensation is not possible as it requires inputs such as future grants and stock prices which are not currently ascertainable.

 

Anyone wishing to contact us or send a message can also do so by visiting: www.airindustriesgroup.com/contact-us/

 

Contacts

 

Air Industries Group

Chief Financial Officer

631-328-7039

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Cover	Jan. 31, 2025
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jan. 31, 2025
Entity File Number	001-35927
Entity Registrant Name	AIR INDUSTRIES GROUP
Entity Central Index Key	0001009891
Entity Tax Identification Number	80-0948413
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	1460 Fifth Avenue
Entity Address, City or Town	Bay Shore
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	11706
City Area Code	631
Local Phone Number	968-5000
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.001
Trading Symbol	AIRI
Security Exchange Name	NYSEAMER
Entity Emerging Growth Company	false

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