UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Confidential, for use of the Commission Only (as permitted by Rule
14a-6(e)(2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-12
AIR INDUSTRIES GROUP, INC.
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
No fee required.
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class 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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(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:
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AIR INDUSTRIES GROUP, INC.
Notice of Annual Meeting of Stockholders
To Be Held On Friday, February 25, 2008 at 10:00 A.M.
TO THE STOCKHOLDERS OF AIR INDUSTRIES GROUP, INC.:
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of Air
Industries Group. Inc., a Delaware corporation (the "Company"), will be held at
the offices of Eaton & Van Winkle LLP, Three Park Avenue, 16th floor, New York,
NY 10016, on Friday, February 25, 2008 at 10:00 A.M., Eastern Time, for the
following purposes:
1. To grant to our Board of Directors discretionary authority to
amend our certificate of incorporation, as amended, to effect
a reverse split of our common stock at a ratio within the
range from one-for-ten to one-for-thirty at anytime prior to
December 31, 2008, with the ratio and timing to be selected
and implemented by the Board in its sole discretion, if at
all; and
2. To approve an amendment to our certificate of incorporation,
as amended, that would increase the number of our authorized
shares of common stock, $0.001 par value, from 120,055,746
shares to 250,000,000 shares.
The Board has fixed the close of business on Thursday, December 27, 2008
as the record date for the determination of the stockholders entitled to notice
of and to vote at this meeting and at any adjournment or postponements thereof.
By Order of the Board of Directors
/s/ Dario Peragallo
Dario Peragallo, Corporate Secretary
Dated: New York, New York
January 4, 2008
IMPORTANT:
Whether or not you expect to attend in person, please complete, sign, date and
return the enclosed Proxy at your earliest convenience. This will ensure the
presence of a quorum at the meeting. Promptly signing, dating and returning the
Proxy will save the Company the expense and extra work of additional
solicitation. An addressed envelope for which no postage is required has been
enclosed for that purpose. Sending in your Proxy will not prevent you from
voting your stock at the meeting if you desire to do so, as your Proxy is
revocable at your option. If your stock is held through a broker, bank or a
nominee and you wish to vote at the meeting, you will need to obtain a proxy
form from your broker, bank or a nominee and present it at the meeting.
AIR INDUSTRIES GROUP, INC.
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
To Be Held on Friday, February 25, 2008
This Proxy Statement is furnished to the stockholders of Air
Industries Group, Inc. in connection with the solicitation by our Board of
Directors of proxies to be used at a Special Meeting of Stockholders to be held
at the offices of Easton & Van Winkle LLP, Three Park Avenue, 16th floor, New
York, NY 10016, on Friday, February 25, 2008 at 10:00 A.M., Eastern Time, and at
any adjournments thereof (the "Special Meeting"). The approximate date on which
this Proxy Statement and the accompanying proxy will be mailed to stockholders
is January 4 , 2008. The Company's executive offices are located at 1479 North
Clinton Avenue, Bay Shore, New York 11706, and our telephone number is (631)
968-5000.
INFORMATION ABOUT THE MEETING
Reasons for the Meeting
We require additional shares of common stock to finance our growth.
As of December 27, 2007, our authorized capital stock consisted of 120,055,746
shares of common stock and 8,003,716 shares of preferred stock, including
2,000,000 shares of series B convertible preferred stock. As of that date, we
had outstanding 69,122,227 shares of common stock and 829,098_shares of series B
convertible preferred stock. The outstanding shares of series B convertible
preferred stock are convertible into 29,847,528 shares of common stock at a
conversion price of $0.276 per share. In addition, as of December 27, 2007, we
had outstanding options and warrants to purchase an additional 15,775,735 shares
of common stock. Consequently, we have only 5,310,256 authorized but unissued
shares of common stock available for issuance by the Board in connection with
financings, acquisitions of other companies, stock dividends, employee benefit
programs or other corporate purposes.
Since October 1, 2007, the market price of our common stock, which
is quoted on the OTC Bulletin Board (symbol: AIRI.OB), has ranged from $0.23 to
$0.35., and the closing price on December 10. 2007 was $0.24.. To qualify our
shares of common stock for investment by certain institutional investors whose
governing instruments prohibit them from purchasing shares of companies quoted
on the OTC Bulletin Board and to attract interest from businesses that may be
suitable candidates for future acquisitions, our Board of Directors has proposed
a plan intended to increase the per share market price of a share of our common
stock to a level sufficient to qualify for a listing on a national stock
exchange, and possibly to qualify as a "marginable security," to provide our
stockholders with greater liquidity. Our Board has called a special meeting of
stockholders at which stockholders will consider and be asked to approve a
proposal that would authorize the Board to implement a reverse stock split of
our common stock within a specified range of exchange ratios at a date, not
later than December 31, 2008, which as discussed below under Proposal 1, may
enable us to obtain a listing on a national securities exchange for our common
stock.
Our Board of Directors believes that our company and our
stockholders would benefit from having our shares of common stock listed on a
national securities exchange, particularly since
o certain institutional investors are precluded by their internal
policies from purchasing low-priced-stocks or shares traded on the
OTC Bulletin Board,
o an exchange listing would provide a broader market for our common
stock and would facilitate the use of our common stock in financings
and other transactions, and
o the SEC has proposed and is considering adopting an amendment to its
rules and registration forms to make it easier and less expensive
for companies whose common stock is listed and traded on a national
securities exchange to register its securities in connection with
public financings on an abbreviated form which permits the
incorporation by reference of reports, proxy statements and other
documents filed under the Exchange Act subsequent to, as well as
prior to, the date upon which the registration statement is declared
effective by the SEC,
Although a reverse stock split would reduce the total number of
shares owned by our existing stockholders, their proportionate equity interest
in our company would not be effected by the reverse stock split. However, we
cannot assure you that if and when implemented, the market price of a share of
our common stock will increase proportionately with the exchange ratio selected
by our Board, or that the resulting market price will be sufficient to obtain a
listing on a national securities exchange, or to qualify as a "marginable
security." The vote of holders of a majority of the shares of common stock and
our series B preferred stock, voting together as a single class, is required to
approve the proposal to effect a reverse stock split of our common stock.
Since the proposal authorizing our Board to implement a reverse
stock split, if approved by our stockholders, may not be effected until later in
2008, if at all, our Board has requested that our stockholders approve a
proposed amendment to our certificate of incorporation, as amended, to increase
the number of authorized shares of our common stock from 120,055,746 shares to
250,000,000 shares so that we will have available sufficient shares to finance
the growth of our business. If both proposals are approved by our stockholders,
the number of authorized shares of common stock would be reduced to 125,000,000
1
shares upon implementation of the reverse stock split. If stockholders do not
approve the reverse stock split or the proposal to increase our authorized
shares of common stock to 250,000,000, we will not have sufficient shares
available to continue our acquisition program, which will adversely affect our
ability to expand our operations.
Record Date and Quorum
Our voting securities consist of our series B convertible preferred
stock and our common stock. All stockholders of record of our series B
convertible preferred stock or common stock at the close of business on
Thursday, December 27, 2007 are entitled to vote at the Special Meeting. Holders
of our series B convertible preferred stock and holders of our common stock on
that date will vote together as a single class on all of the matters described
above. Each share of common stock will be entitled to one vote and each share of
series B convertible preferred stock will be entitled to 36 votes, representing
that number of votes that the holder would have if that share had been converted
into common stock on December 27, 2007.
As of the close of business on December 27, 2007, we had outstanding
69,122,227 shares of common stock and 829,098 shares of series B convertible
preferred stock. The total number of votes that may be cast at the Special
Meeting is 98,969,755, representing the total number of shares of common stock
that we would have outstanding on December 27, 2007 if all of those shares of
series B convertible preferred stock had been converted into common stock on
that date. Shares of common stock and series B convertible preferred stock
represented by each properly executed, unrevoked proxy received in time for the
Special Meeting will be voted as specified. A quorum will be present at the
Special Meeting if the shares of common stock and series B convertible preferred
stock outstanding on December 27, 2007, representing a majority of the total
number of votes entitled to be voted, are present at the Special Meeting in
person or by proxy.
If you are the beneficial owner, but not the record owner, of our
series B convertible preferred stock or common stock, you will receive
instructions about voting from the bank, broker or other nominee that is the
stockholder of record of your shares. Contact your bank, broker or other nominee
directly if you have questions.
Voting of Proxies
Unless otherwise directed in the enclosed proxy, the persons acting
as proxies pursuant to the enclosed proxy will vote the shares represented by
the proxy for: (i) approval of the grant to our Board of discretionary authority
to amend our certificate of incorporation, as amended at any time prior to
December 31, 2008 to effect a reverse stock split of our common stock at a ratio
within the range from one-for-ten to one-for-thirty or if that proposal is not
approved by stockholders, (ii) approval of an amendment to our certificate of
incorporation, as amended, increasing the number of shares of common stock to
250,000,000.
Voting Requirements
All votes will be tabulated by the inspector of election appointed
for the Special Meeting, who will separately tabulate affirmative and negative
votes, abstentions and broker non-votes. Under our bylaws (the "Bylaws") and
the Delaware General Corporation Law, or "DGCL", (1) shares represented by
proxies that reflect abstentions or "broker non-votes" ( i.e ., shares held by a
broker or nominee that are represented at the meeting, but with respect to which
such broker or nominee is not empowered to vote on a particular proposal) will
be counted as shares that are present and entitled to vote for purposes of
determining the presence of a quorum; and (2) with respect to the proposed
amendments to our certificate of incorporation, proxies that reflect abstentions
or non-votes will be treated as not voted and will have the same effect as votes
against those proposals.
The affirmative vote of a majority of the aggregate number of votes
represented by the shares of common stock and series B convertible preferred
stock, voting as a single class, entitled to vote at the Special Meeting is
required to approve the amendments (or potential amendment) to our certificate
of incorporation (i) granting the Board discretionary authority to effectuate a
reverse stock split, or if that proposal is not approved by stockholders, (ii)
increasing the number of authorized shares of common stock.
Revocability of Proxy
A proxy may be revoked by the stockholder giving the proxy at any
time before it is voted by delivering written notice to our Corporate Secretary
at or prior to the meeting, and a prior proxy is automatically revoked by a
stockholder giving a subsequent proxy or attending and voting at the meeting.
Attendance at the meeting in and of itself does not revoke a prior proxy.
Expenses of Solicitation
We will bear the entire cost of this proxy solicitation, including
the cost of preparing, printing and mailing this Proxy Statement, the proxy and
any additional soliciting materials sent by us to stockholders. In addition, we
may reimburse brokerage firms and other persons representing beneficial owners
of shares for reasonable expenses incurred by them in forwarding proxy
soliciting materials to such beneficial owners. Proxies may also be solicited by
certain of our directors, officers and employees, without additional
compensation, personally or by telephone.
2
Securities Ownership
The following table sets forth information known to us regarding
beneficial ownership of our series B convertible preferred stock and our common
stock as of December 27, 2007 by (i) each person known by us to own beneficially
more than 5% of the outstanding shares of each of those classes, (ii) each of
our directors, nominees for director, and executive officers, and (iii) all of
our officers and directors as a group. Except as otherwise indicated, we
believe, based on information provided by each of the individuals named in the
table below, that such individuals have sole investment and voting power with
respect to such shares, subject to community property laws, where applicable.
As of December 27, 2007, we had outstanding 829,098 shares of our
series B convertible preferred stock and 69,122,227 shares of our common stock.
Each share of series B convertible preferred stock is convertible into 36 whole
shares of our common stock. If all outstanding shares of series B convertible
preferred stock had been converted at the close of business on December 27,
2007, we would have had outstanding 98,969,755 shares of common stock. Except as
stated in the table,the address of the holder is c/o our company, 1479 North
Clinton Avenue, Bay Shore, New York 11706.
Number of Shares Percent of Class
Name Series B Preferred Common* Series B Preferred Common*
---- ------------------ ------- ------------------ -------
Owner of More than 5% of Class
Hillson Partners LP(2)
Hillson Private Partners II, LLLP(2) 134,343 4,836,348 16.21% 6.25%
110 N. Washington Street, Suite 401
Rockville, MD 20850
Michael A. Gales -- 4,090,799 (1) -- 5.83%
333 East 66th Street
New York, NY 10022
George Elkins -- 3,615,340 5.23%
Carole Tate -- 3,615,340 5.23%
Directors and Executive Officers
James A. Brown 221 917,225 (6) ** 1.33%
Louis A. Giusto 221 4,132,494 (3) ** 5.92%
Peter D. Rettaliata 221 1,476,095 (4) ** 2.12%
Dario Peragallo 221 1,476,095 (5) ** 2.12%
Seymour G. Siegel 221 141,289 (6) ** **
Ira A. Hunt, Jr -- 842,430 (6)(7) -- 1.22%
David J. Buonanno 221 46,289 (8) ** **
All directors and officers 1,326 9,025,918 (3)(4)(5)(6)(7) ** 12.77%
as a group (7 persons)
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* Assumes the conversion of the shares of series B convertible preferred
stock owned by the stockholder listed in the table, but not by any other
holder.
** Less than 1%
(1) Includes 1,000,000 shares we may issue to Mr. Gales upon exercise of
options granted under his employment agreement that pursuant to his
separation agreement are exercisable until March 16, 2008.
(2) The general partner of Hillson Partners LP and Hillson Private Partners
II, LLLP is Daniel H. Abramowitz, who has the sole power to vote and
dispose of the shares.
(3) Includes 720,000 shares we may issue to Mr. Giusto upon exercise of the
vested portion of the 1,200,000 options granted to him under his
employment agreement.
(4) Includes 450,000 shares we may issue to Mr. Rettaliata upon exercise of
the vested portion of the 1,200,000 options granted to him under his
employment agreement.
(5) Includes 450,000 shares we may issue to Mr. Peragallo upon exercise of
vested portion of the 1,200,000 options granted to him under his
employment agreement.
(6) Includes, in each case, 33,333 shares we may issue to Messrs. Brown, Hunt
and Siegel upon exercise of the vested portion of the 100,000 options
granted to each of them on February 13, 2007.
(7) Includes 709,097 shares owned by Mr. Hunt's spouse.
(8) Includes 33,333 shares we may issue to Mr. Buonanno upon exercise of the
vested portion of the 100,000 options granted to him on August 29, 2007.
3
PROPOSAL 1
(Item 1 on the Proxy Card)
TO GRANT TO OUR BOARD DISCRETIONARY AUTHORITY TO AMEND
OUR CERTIFICATE TO EFFECT A REVERSE STOCK SPLIT OF
OUR COMMON STOCK AT A RATIO WITHIN THE RANGE FROM ONE-FOR-FIVE TO
ONE-FOR-FIFTY AT ANY TIME PRIOR TO DECEMBER 31, 2008.
Background
On December 3, 2007, our Board, unanimously adopted a resolution
seeking stockholder approval to grant the Board the discretionary authority to
amend our certificate of incorporation to effect a reverse split of our common
stock at a ratio within the range from one-for ten to one-for-thirty at any time
it determines prior to December 31, 2008. A copy of the proposed amendment is
attached hereto as Appendix I. Stockholder approval of this proposal would also
give the Board authority to decline to implement a reverse stock split prior to
such date or at all. The ratio of the reverse stock split that the Board
approved and deemed advisable and for which it is seeking stockholder approval
is in the range from one-for-ten to one-for-thirty with the exact ratio to be
established within this range by the Board in its sole discretion at the time it
elects to effect a split, if any. The ratio that the Board will seek to
establish will reflect the price at which our common stock needs to trade to
satisfy the initial listing requirements of the exchange upon which we apply for
a listing.
If our stockholders approve the reverse stock split proposal and the
Board decides to implement the reverse stock split, we will file the proposed
amendment with the Secretary of State of the State of Delaware (as described
below) which will effect a reverse split of the shares of our common stock then
issued and outstanding at the specific ratio determined by the Board. If the
reverse stock split is implemented, the number of authorized shares of common
stock would increase from 120,055,746 to 125,000,000, but the par value of the
common stock would remain unchanged at 0.001 per share. Except for any changes
as a result of the treatment of fractional shares, each stockholder will hold
the same percentage of our common stock outstanding immediately following the
reverse stock split as such stockholder did immediately prior to the split.
Reasons for This Proposal
The Board of Directors approved the amendment to effect a reverse
stock split because (i) it believes that our company and our stockholders would
benefit from having our shares of common stock listed on a national securities
exchange such as the Nasdaq Capital Market or the American Stock Exchange,
particularly since certain institutional investors are precluded by their
internal policies from purchasing low-priced-stocks or shares traded on the OTC
Bulletin Board, (ii) the reverse stock split would increase the number of
authorized but unissued shares of our common stock which will be available for
issuance in future financings and other transactions, as well as an incentive to
attract and retain individuals as part of our growth strategy, and (iii) if the
market price of a share of our common stock following the implementation of the
reverse split is at least $5.00, our common stock will be a "margin security"
allowing purchasers of our common stock to borrow up to 50% of the market value
of the shares they own.
Exchange Listing. Our common stock is currently quoted on the
Over-the-Counter Bulletin Board, electronic quotation system under the symbol
"AIRI.OB" and is trading below $1.00 per share. The Board of Directors believes
that a listing on an exchange would provide a broader market for our common
stock and would facilitate the use of our common stock in financings and other
transactions. The Board of Directors approved the reverse stock split proposal
partly as a means, if necessary, of increasing the share price of our common
stock above the minimum bid price requirement for a listing on an exchange.
Currently, the minimum bid price requirement for listing is $4.00 on the Nasdaq
Capital Market and $3.00 per share on the American Stock Exchange.
Potential Increased Investor Interest. The Board believes that the
current low per share market price of the common stock has had a negative effect
on the marketability of our existing shares. The Board believes there are
several reasons for these effects. First, certain institutional investors have
internal policies preventing the purchase of low-priced stocks. Also, a variety
of policies and practices of broker-dealers discourage individual brokers within
those firms from dealing in low-priced stocks or shares listed on the OTC
Bulletin Board. Second, because the brokers' commissions on low-priced stocks
generally represent a higher percentage of the stock price than commissions on
higher priced stocks, the current share price of the common stock can result in
individual stockholders paying transaction costs (commissions, markups or
markdowns) which are a higher percentage of their total share value than would
be the case if the share price of the common stock were substantially higher.
This factor is also believed to limit the willingness of some institutions to
purchase our common stock. The Board anticipates that a reverse stock split will
result in a higher bid price for the common stock, which may help to alleviate
some of these problems. The Board also believes that the decrease in the number
of shares of common stock outstanding as a consequence of a reverse stock split,
and the anticipated increase in the price of the common stock, could generate
interest in the common stock and possibly promote greater liquidity for our
stockholders. However, any increase in the market price of the common stock
resulting from the reverse stock split may be proportionately less than the
decrease in the number of outstanding shares, effectively reducing our market
capitalization. In addition, because the Delaware Annual Franchise Tax is based
on authorized capital, we believe that a reverse stock split may reduce the
amount of this tax.
4
Increase in Number of Authorized but Unissued Shares. If the proposal to
authorize our Board to effect a reverse split on the terms discussed above is
approved by our stockholders, the number of authorized shares of common stock
would be increased from 120,055,746 shares to 125,000,000 shares. The adoption
and implementation of the reverse stock split would not effect the number of
authorized shares of preferred stock which would remain at 8,003,716 shares.
Based on shares outstanding as of December 27, 2007, in the event of a reverse
stock split at a 10:1, or 30:1 ratio, the number of shares of our common stock
issued and outstanding would be reduced from 69,122,227 shares to approximately
6,912,222 shares or 2,304,074 shares, respectively. Therefore, as a result of
the reverse stock split the number of authorized but unissued shares of our
common stock would increase by up to approximately 71,762,407 shares.
If the reverse split is implemented, the additional authorized
shares of common stock will be available for issuance at such times and for such
purposes as the Board may deem advisable without further action by our
stockholders, except as may be required by applicable laws or regulations. For
example, the additional authorized shares of common stock will be available for
issuance by the Board in connection with financings, acquisitions of other
companies, stock dividends, employee benefit programs or other corporate
purposes. Except for the shares of common stock issuable in connection with the
conversion of our series B convertible preferred stock (including shares we may
issue in lieu of cash dividends), outstanding warrants and options, shares
reserved for issuance under the 2005 Stock Incentive Plan, and shares that we
will issue upon conversion of a convertible security we will issue if we
complete the previously disclosed acquisition of H.S.M Machine Works, Inc.,
H.S.M. Machine Works, Inc, Blair Accumulators, Inc.and Blair Industries, Inc.
(collectively, the "Blair Companies"), shares we may issue to finance that
acquisition and in connection with acquisitions under consideration but as to
which we have not entered into any letters of intent, agreements in principle or
definitive agreements at this time, we do not have any plans or commitments to
issue additional shares of common stock. The Board does not intend to issue any
shares of common stock, or securities convertible into, or exchangeable or
exercisable for shares of common stock, except on terms or for reasons which the
Board deems to be in the best interests of our company and our stockholders.
Other than as set forth above, the Board of Directors does not have
any other plan or intention to issue the additional shares of authorized but
unissued common stock that would become available as a result of the proposed
reverse split.
For the above reasons, the Board believes that providing
discretionary authority to the Board to implement the reverse stock split is in
our best interests and those of our stockholders. However, we cannot assure you
that the reverse stock split will be implemented or, if implemented, will have
the desired consequences. Specifically, there can be no assurance that, after
the reverse stock split, the market price of the common stock will not be less
than the market price before the proposed reverse stock split.
The Board believes that stockholder approval of an exchange ratio
range (rather than an exact exchange ratio) provides the Board with maximum
flexibility to achieve the purposes of the reverse stock split. If the
stockholders approve the reverse stock split proposal, the reverse stock split
will be effected, if at all, only upon a determination by the Board that the
reverse stock split is in our best interests and those of our stockholders at
that time. In connection with any determination to effect a reverse stock split,
the Board will set the timing for the reverse stock split and select the
specific ratio within the range, and in selecting the exchange ratio, will
consider the exchange ratio which will have the least impact in reducing the
number of shares of existing owners consistent with the objectives of obtaining
a listing on a national securities exchange and satisfying the $5.00 minimum
price required for qualifying the common stock as a "marginable security." These
determinations will be made by the Board with the intent to create the greatest
marketability of our common stock based on prevailing market conditions at that
time. If the proposal is approved, no further action on the part of stockholders
will be required to either implement or abandon the reverse stock split. If the
Board does not implement a reverse stock split prior to December 31, 2008, the
authority granted in this proposal to implement a reverse stock split on these
terms will terminate. The Board reserves its right to elect not to proceed with
the reverse stock split if it determines, in its sole discretion, that the split
is no longer in our best interests and those of our stockholders.
Certain Risks Associated With the Reverse Stock Split
We cannot assure you that the total market capitalization of our common stock
after the proposed reverse stock split will be equal to or greater than the
total market capitalization before the proposed reverse stock split or that the
per share market price of our common stock following the reverse stock split
will either exceed or remain higher than the current per share market price.
We cannot assure you that the market price per new share of common
stock (the "New Shares") after the reverse stock split will rise or remain
constant in proportion to the reduction in the number of old shares of common
stock (the "Old Shares") outstanding before the reverse stock split. For
example, based on the closing market price of our common stock on December 10,
2007 of $0.24 per share, if the Board decided to implement the reverse stock
split and selects a reverse stock split ratio of one-for-ten, we cannot assure
you that the post-split market price of our common stock would be $2.40 per
share. Alternatively, if the Board decided to implement the reverse stock split
and selects a reverse stock split ratio of one-for-thirty we cannot assure you
that the post-split market price of our common stock would be $7.20 per share.
Accordingly, the total market capitalization of our common stock after the
proposed reverse stock split may be lower than the total market capitalization
before the proposed reverse stock split and, in the future, the market price of
our common stock following the reverse stock split may not exceed or remain
higher than the market price prior to the proposed reverse stock split. In many
cases, the total market capitalization of a company following a reverse stock
split is lower than the total market capitalization before the reverse stock
split.
5
A decline in the market price for our common stock after the reverse stock split
may result in a greater percentage decline than would occur in the absence of a
reverse stock split, and the liquidity of our common stock could be adversely
affected following a reverse stock split.
The market price of our common stock will be based on our
performance and other factors, some of which are unrelated to the number of
shares outstanding. If the reverse stock split is effected and the market price
of our common stock declines, the percentage decline as an absolute number and
as a percentage of our overall market capitalization may be greater than would
occur in the absence of a reverse stock split. In many cases, both the total
market capitalization and the market price of a share of a company's common
stock following a reverse stock split are lower than they were before the
reverse stock split. Furthermore, the liquidity of our common stock could be
adversely affected by the reduced number of shares that would be outstanding
after the reverse stock split.
Principal Effects of the Reverse Stock Split
Corporate Matters. If approved and effected, the reverse stock split would
have the following effects:
o depending on the exact reverse stock split ratio selected by
the Board, between ten and thirty Old Shares owned by a
stockholder would be exchanged for one (1) New Share;
o the number of shares of Common Stock issued and outstanding
will be reduced proportionately based on the reverse stock
split ratio selected by the Board;
o based on the reverse stock split ratio selected by the Board,
proportionate adjustments will be made to the per share
exercise price and the number of shares issuable upon the
exercise of all outstanding options and warrants entitling the
holders thereof to purchase shares of our common stock, which
will result in approximately the same aggregate price being
required to be paid for such options or warrants upon exercise
of such options or warrants immediately preceding the reverse
stock split; and
o the number of shares reserved for issuance under our existing
stock option plan will be reduced proportionately based on the
reverse stock split ratio selected by the Board.
If approved and effected, the reverse stock split will be effected
simultaneously for all common stock and the ratio will be the same for all
common stock. The reverse stock split will affect all of our stockholders
uniformly and will not affect any stockholder's percentage ownership interests
in us, except to the extent that the reverse stock split results in any of our
stockholders owning a fractional share. As described below, stockholders holding
fractional shares will be entitled receive one additional share in lieu of such
fractional shares. Common stock issued pursuant to the reverse stock split will
remain fully paid and non-assessable. We will continue to be subject to the
periodic reporting requirements of the Exchange Act.
Fractional Shares. No scrip or fractional certificates will be issued in
connection with the reverse stock split, if effected. Stockholders who otherwise
would be entitled to receive fractional shares because they hold a number of Old
Shares not evenly divisible by the ratio selected by the Board for the reverse
stock split will be entitled, upon surrender of certificate(s) representing such
shares, to receive one additional share of common stock in lieu of a fractional
share.
If approved and effected, the reverse stock split will result in
some stockholders owning "odd lots" of less than 100 shares of common stock.
Brokerage commissions and other costs of transactions in odd lots are generally
somewhat higher than the costs of transactions in "round lots" of even multiples
of 100 shares.
Authorized Shares. As of December 27, 2007, our authorized common stock
was 120,055,746 shares and upon the effectiveness of the reverse stock split,
the number of authorized shares of common stock will be 125,000,000.
Accounting Matters. The reverse stock split will not affect the par value
of our common stock. As a result, as of the effective time of the reverse stock
split, the stated capital on our balance sheet attributable to our common stock
will be reduced proportionately based on the reverse stock split ratio selected
by the Board, and the additional paid-in capital account will be credited with
the amount by which the stated capital is reduced. The per share net income or
loss and net book value of our common stock will be restated because we will
have less shares of common stock outstanding.
Potential Anti-Takeover Effect. Although the increased proportion of
unissued authorized shares to issued shares could, under certain circumstances,
have an anti-takeover effect (for example, by permitting issuances that would
dilute the stock ownership of a person seeking to effect a change in the
composition of our Board or contemplating a tender offer or other transaction
for the combination of us with another company), the reverse stock split
proposal is not being proposed in response to any effort of which we are aware
to accumulate our shares of common stock or obtain control of us, nor is it part
of a plan by management to recommend a series of similar amendments to our Board
and stockholders. Other than the reverse stock split proposal, the Board does
not currently contemplate recommending the adoption of any other amendments to
our certificate of incorporation that could be construed to affect the ability
of third parties to take over or change the control of us.
6
Procedure for Effecting Reverse Stock Split and Exchange of Stock Certificates
If the stockholders approve the proposal to authorize the Board to
implement the reverse stock split and the Board decides to implement the reverse
stock split on or prior to December 31, 2008, we will file an amendment
substantially in the form set forth on Appendix I with the Secretary of State of
the State of Delaware. The text of the amendment may be modified to include such
changes as may be required by the office of the Secretary of State of the State
of Delaware and as the Board deems necessary and advisable to effect the reverse
stock split, including the insertion of the effective time and the applicable
reverse stock split ratio determined by the Board. The reverse stock split will
become effective at the time specified in the amendment. Beginning at the
effective time, each certificate representing Old Shares will be deemed for all
corporate purposes to evidence ownership of New Shares.
As soon as practicable after the effective time, stockholders will
be notified that the reverse stock split has been effected. We expect that our
transfer agent will act as exchange agent for purposes of implementing the
exchange of stock certificates. Holders of Old Shares will be asked to surrender
to the exchange agent certificates representing Old Shares in exchange for
certificates representing New Shares in accordance with the procedures to be set
forth in the letter of transmittal we send to our stockholders. No new
certificates will be issued to a stockholder until such stockholder has
surrendered such stockholder's outstanding certificate(s), together with the
properly completed and executed letter of transmittal, to the exchange agent.
Any Old Shares submitted for transfer, whether pursuant to a sale, other
disposition or otherwise, will automatically be exchanged for New Shares.
STOCKHOLDERS SHOULD NOT DESTROY ANY STOCK CERTIFICATE(S) AND SHOULD NOT SUBMIT
ANY CERTIFICATE(S) UNTIL REQUESTED TO DO SO.
No Dissenters' Rights
Under the DGCL, stockholders are not entitled to dissenters' rights
with respect to the reverse stock split, and we will not independently provide
stockholders with any such right.
Federal Income Tax Consequences of the Reverse Stock Split
The following is a summary of certain material federal income tax
consequences of the reverse stock split, does not purport to be a complete
discussion of all of the possible federal income tax consequences of the reverse
stock split and is included for general information only. Further, it does not
address any state, local or foreign income or other tax consequences. Also, it
does not address the tax consequences to holders that are subject to special tax
rules, such as banks, insurance companies, regulated investment companies,
personal holding companies, foreign entities, nonresident alien individuals,
broker-dealers and tax-exempt entities. The discussion is based on the
provisions of the United States federal income tax law as of the date hereof,
which is subject to change retroactively as well as prospectively. This summary
also assumes that the Old Shares were, and the New Shares will be, held as a
"capital asset," as defined in the Internal Revenue Code of 1986, as amended and
in effect from time to time, or any superseding federal revenue statute (i.e.,
generally, property held for investment). The tax treatment of a stockholder may
vary depending upon the particular facts and circumstances of such stockholder.
Each stockholder is urged to consult with such stockholder's own tax advisor
with respect to the tax consequences of the reverse stock split.
Other than shares received in lieu of for fractional shares
discussed below, no gain or loss should be recognized by a stockholder upon such
stockholder's exchange of Old Shares for New Shares pursuant to the reverse
stock split. The aggregate tax basis of the New Shares received in the reverse
stock split (including any fraction of a New Share deemed to have been received)
will be the same as the stockholder's aggregate tax basis in the Old Shares
exchanged there for. In general, stockholders who receive an additional share in
exchange for their fractional share interests in the New Shares as a result of
the reverse stock split will recognize gain or loss based on their adjusted
basis in the fractional share interests redeemed. The stockholder's holding
period for the New Shares will include the period during which the stockholder
held the Old Shares surrendered in the reverse stock split.
Our view regarding the tax consequences of the reverse stock split
is not binding on the Internal Revenue Service or the courts. ACCORDINGLY, EACH
STOCKHOLDER SHOULD CONSULT WITH HIS OR HER OWN TAX ADVISOR WITH RESPECT TO ALL
OF THE POTENTIAL TAX CONSEQUENCES TO HIM OR HER OF THE REVERSE STOCK SPLIT.
The Board Unanimously Recommends a Vote FOR Granting our Board Discretionary
Authority to Amend our Certificate to Effect a Reverse Stock Split of
our Common Stock at a Ratio Within the Range from One-For-TenTo
One-For-Thirty at any Time Prior to December 31, 2008.
7
PROPOSAL 2
(Item 2 on the Proxy Card)
APPROVAL OF AN AMENDMENT TO OUR CERTIFICATE TO INCREASE
THE NUMBER OF AUTHORIZED SHARES OF OUR COMMON STOCK
Background
On December 3, 2007, our Board unanimously approved, and recommended
that our stockholders approve, an amendment to our certificate of incorporation
to increase the number of authorized shares of common stock to 250,000,000.
Currently, we are authorized to issue 120,055,746 shares of common stock. If
this proposal and the proposal authorizing our Board to effect a reverse stock
split of our common stock is approved by stockholders, the number of authorized
shares of common stock would be reduced to 125,000,000 shares upon
implementation of the reverse stock split. If stockholders do not approve the
proposal to increase our authorized shares of common stock to 250,000,000, we
will not have sufficient shares available to continue our acquisition program,
which will adversely affect our ability to expand our operations
Our Board has declared advisable the proposed amendment to our
certificate of incorporation because the Board considers it in the best
interests of our company to have available a sufficient number of shares of
common stock to provide the Board with flexibility to engage in financing and
other transactions involving the issuance of additional shares of common stock
and to provide for employee and director stock-based compensation, all of which
are critical to our growth.
As of December 27, 2007, our authorized capital stock consisted of
120,055,746 shares of common stock and 8,003,716 shares of preferred stock,
including 2,000,000 shares of series B convertible preferred stock. As of that
date, we had outstanding 69,122,227 shares of common stock and 829,098 shares of
series B convertible preferred stock. The outstanding shares of series B
convertible preferred stock are convertible into 29,827,528 shares of common
stock at a conversion price of $0.276 per share. In addition, as of December 27,
2007, we had outstanding warrants and options to purchase an additional
15,775,735 shares of common stock. Consequently, we have only 5,310,256
authorized but unissued shares of common stock available for issuance by the
Board in connection with financings, acquisitions of other companies, stock
dividends, employee benefit programs or other corporate purposes.
Consequences of Approval of Increase in Authorized Common Stock
If approved, the additional authorized shares of common stock will
be available for issuance at such times and for such purposes as the Board may
deem advisable without further action by our stockholders, except as may be
required by applicable laws or regulations. For example, the additional
authorized shares of common stock will be available for issuance by the Board in
connection with financings, acquisitions of other companies, stock dividends,
employee benefit programs or other corporate purposes. Except for the shares of
common stock issuable in connection with the conversion of our series B
convertible preferred stock ( including shares we may issue in lieu of cash
dividends), outstanding warrants and options, shares reserved for issuance under
the 2005 Stock Incentive Plan, and shares of a newly authorized series of
convertible preferred stock we will issue if we complete the previously
disclosed acquisition of the Blair Companies and the shares of common stock
issuable upon conversion of that series of preferred stock, shares we may issue
to finance that acquisition and in connection with acquisitions under
consideration but as to which we have not entered into any letters of intent,
agreements in principle or definitive agreements at this time, we do not have
any plans or commitments to issue capital stock. The Board does not intend to
issue any stock except on terms or for reasons which the Board deems to be in
the best interests of our company and our stockholders. Because the holders of
our common stock do not have preemptive rights, the issuance of additional
shares of common stock (other than on a pro-rata basis to all current
stockholders such as pursuant to a stock dividend) would have the effect of
reducing our existing stockholders' proportionate interests.
The Board has the authority, without action by our stockholders, to
designate and issue preferred stock in one or more series and to designate
certain rights, preferences and restrictions of each series, any or all of which
may be greater than the rights of the common stock. It is not possible to state
the actual effect of the issuance of any preferred stock upon the rights of
holders of our common stock until the Board determines the specific rights of
the holders of such preferred stock. The effects might include restricting
dividends on the common stock, diluting the voting power of the common stock,
impairing the liquidation rights of our common stock and delaying or preventing
a change in control of our company without further action by our stockholders.
Any future issuance of our common stock will be subject to the rights of holders
of outstanding shares of preferred stock that we may issue in the future.
Subject to applicable laws or regulations, preferred stock may be designated and
issued from time to time without action by our stockholders to such persons and
for such consideration and on such terms as the Board determines.
Anti-Takeover Effects
Although the proposal to increase the authorized capital stock may
be construed as having an anti-takeover effect, because authorized and unissued
common stock could be issued for the purpose of discouraging an attempt by
another person to take control of our company, neither our management nor our
Board views this proposal as an anti-takeover mechanism. In addition, this
proposal is not part of any plan by us to recommend a series of anti-takeover
amendments to the certificate of incorporation, and we do not currently
contemplate recommending the adoption of other amendments to our certificate of
incorporation that could be construed to affect the ability of third parties to
take over or change control of our company.
8
Certificate of Amendment
If the stockholders approve the proposal to increase our authorized
shares of common stock, we will cause a certificate of amendment to our
certificate of incorporation to be filed with the Delaware Secretary of State as
attached hereto in Appendix II. Upon the effectiveness of the proposed
amendment, Article Fourth of our certificate of incorporation would be amended
in its entirety to read as follows:
"FOURTH: The total number of shares of all classes of stock which
the Corporation shall have authority to issue is 258,003,716 shares,
consisting of 250,000,000 shares of common stock, $.001 par value
per share (the "Common Stock"), and 8,003,716 shares of preferred
stock, $.001 par value per share (the "Preferred Stock")."
The Board Recommends a Vote FOR the Proposal to Amend the
Certificate to Increase the Number of Authorized Shares of Common Stock
and Proxies that are Signed and Returned will be so Voted
Unless Otherwise Instructed.
ADDITIONAL INFORMATION
Householding
The SEC's rules permit companies and intermediaries such as brokers
to satisfy delivery requirements for proxy statements and annual reports with
respect to two or more stockholders sharing the same address by delivering a
single proxy statement and annual report addressed to those stockholders. This
process, which is commonly referred to as "householding,"' potentially provides
extra convenience for stockholders and cost savings for companies. Some brokers
household proxy materials and annual reports, delivering a single proxy
statement and annual report to multiple stockholders sharing an address,
although each stockholder will receive a separate proxy card. Once you have
received notice from your broker that they will be householding materials to
your address, householding will continue until you are notified otherwise or
until you revoke your consent. If at any time you no longer wish to participate
in householding and would prefer to receive a separate Proxy Statement and
annual report, please notify your broker. If you would like to receive a
separate copy of this year's Proxy Statement or Annual Report, please address
your request for delivery of this Proxy Statement and/or annual report to Air
Industries Group, Inc., 1479 North Clinton Avenue, Bay Shore, New York 11706.
Available Information
We file annual, quarterly and periodic reports, proxy statements and
other information with the SEC. These filings are available to the public on the
Internet at the SEC's web site, http://www.sec.gov. The SEC's web site contains
reports, proxy statements and other information regarding issuers, like us, that
file these reports, statements and other documents electronically with the SEC.
You can also read and copy any document we file with the SEC at the SEC's Public
Reference Room 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 SEC's
Public Reference Section at that address. Please call the SEC at 1-800-SEC-0330
for further information regarding the operation of the Public Reference Room.
EVERY STOCKHOLDER, WHETHER OR NOT HE OR SHE EXPECTS TO ATTEND THE ANNUAL
MEETING IN PERSON, IS URGED TO EXECUTE THE PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED BUSINESS REPLY ENVELOPE.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Dario Peragallo
Dario Peragallo, Corporate Secretary
Dated: New York, New York
January 4, 2008
9
APPENDIX I (REVERSE SPLIT CERTIFICATE AMENDMENT)
CERTIFICATE OF AMENDMENT
OF CERTIFICATE OF INCORPORATION OF
AIR INDUSTRIES GROUP, INC.
(Pursuant to Section 242 of
the Delaware General Corporation Law)
Air Industries Group, Inc. (the "Corporation"), a corporation organized
and existing under and by virtue of the Delaware General Corporation Law (the
"DGCL"), does hereby certify that:
1. The name of the Corporation is Air Industries Group, Inc.
2. The Board of Directors of the Corporation at a meeting duly called duly
adopted resolutions setting forth an amendment to the Corporation's
Certificate of Incorporation, as amended (the "Certificate of
Incorporation"'), declaring such amendment to be advisable, amending
Article FOURTH (i) so that the first sentence thereof in its entirety
reads as follows:
"FOURTH: The total number of shares of each class that the corporation
shall have the authority to issue is 133,003,716 shares, consisting of:
(a) 125,000,000 shares of common shares (the "Common Shares"), par
value $.001 per share; and
(b) 8,003,716 shares of preferred shares (the "Preferred Shares"),
par value $.001 per share."
and (ii) by inserting the following paragraph at the end of Section A
thereof: so that the issued shares of the Corporation's Common Stock on
the date hereof shall be combined into a smaller number of shares of
Common Stock in the ratio of one new share for each __ old shares
immediately upon the filing of this Certificate of Amendment.
"3. Reverse Split. Each share of the Corporation's Common Stock issued
prior to the date hereof (the "Old Common Stock"), will be automatically
reclassified as and converted into new shares of Common Stock (the "New
Common Stock"). No fractional shares of New Common Stock shall be issued
to the holders of record of Old Common Stock in connection with the
foregoing reclassification of shares of Old Common Stock. In lieu thereof,
the Corporation will issue to each holder of record one additional share
of New Common Stock in lieu of any fractional shares otherwise issuable to
such holder . Each stock certificate that, immediately prior to the date
hereof, represented shares of Old Common Stock shall, from and after the
date hereof, automatically and without the necessity of presenting the
same for exchange, represent that number of whole shares of New Common
Stock into which the shares of Old Common Stock represented by such
certificate shall have been reclassified (as well as the right to receive
one additional share in lieu of any fractional shares of New Common Stock
as set forth above); provided, however, that each holder of record of a
certificate that represented shares of Old Common Stock shall receive,
upon surrender of such certificate, a new certificate representing the
number of whole shares of New Common Stock into which the shares of Old
Common Stock represented by such certificate shall have been reclassified,
as well as an additional share of New Common Stock in lieu of fractional
shares of New Common Stock to which such holder may be entitled as set
forth above."
3. That this.Certificate of Amendment was duly adopted in accordance with the
provisions of Section 242 of the DGCL.
4. This Certificate of Amendment shall become effective upon the filing
hereof in the Office of the Secretary of State of the State of Delaware.
Executed on this day of , 2008.
Air Industries Group, Inc.
By:
I-1
APPENDIX II (CERTIFICATE AMENDMENT)
CERTIFICATE OF AMENDMENT
OF CERTIFICATE OF INCORPORATION OF
AIR INDUSTRIES GROUP, INC.
(Pursuant to Section 242 of
the Delaware General Corporation Law)
Air Industries Group, Inc. (the "Corporation"), a corporation organized
and existing under and by virtue of the Delaware General Corporation Law (the
"DGCL"), does hereby certify that:
1. The Board of Directors of the Corporation at a meeting duly called
unanimously duly adopted resolutions setting forth a proposed amendment
(the "Amendment") to the Certificate of Incorporation of the Corporation,
as amended (the "Certificate of Incorporation"), declaring the Amendment
advisability to its stockholders, and directing that the Amendment be
considered at the 2008 special meeting of the stockholders of the
Corporation followed by a majority vote in favor of the Amendment by the
stockholders at such special meeting. The Amendment provides that the
first sentence of Article Fourth of the Certificate of Incorporation be
amended in its entirety to read as follows:
"FOURTH: The total number of shares of all classes of stock which the
Corporation shall have authority to issue is 258, 003,716 shares,
consisting of 250,000,000 shares of common stock, $.001 par value per
share (the "Common Stock"), and 8,003,716 shares of preferred stock, $.001
par value per share (the "Preferred Stock")."
2. That the Amendment herein certified has been duly adopted in accordance
with the provisions of Section 242 of the DGCL.
3. This Certificate of Amendment shall become effective upon the filing
hereof in the Office of the Secretary of State of the State of Delaware.
Executed on this day of , 2008.
Air Industries Group, Inc.
By:
Peter D. Rettaliata
President and Chief Executive Officer
I-2
AIR INDUSTRIES GROUP, INC.
P R O X Y
FOR HOLDERS OF COMMON STOCK
FOR SPECIAL MEETING OF THE STOCKHOLDERS
FRIDAY, FEBRUARY 25, 2008
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Peter D. Rettaliata and Louis A.
Giusto, and each of them, with full power of substitution, as proxies to vote
the shares which the undersigned is entitled to vote at the Special Meeting of
the Stockholders of Air Industries Group, Inc. to be held at the offices of
Eaton & Van Winkle LLP, Three Park Avenue, 16th floor, New York, NY, on Friday,
February 25, 2008 at 10:00 A.M., Eastern Time and at any adjournments thereof,
hereby revoking any proxies heretofore given, to vote all shares of common stock
of Air Industries Group, Inc. held or owned by the undersigned as indicated on
the proposals as more fully set forth in this Proxy Statement, and in their
discretion upon such other matters as may come before the meeting.
Please mark "X" your votes as indicated:
1. To grant to our board of directors discretionary authority to FOR AGAINST ABSTAIN
amend our certificate of incorporation to effect a reverse stock
split of our common stock at a ratio within the range from
one-for ten to one-for thirty at any time prior to
December 31, 2008.
2. To approve an amendment to our certificate of incorporation that FOR AGAINST ABSTAIN
would increase the number of shares of our authorized shares of
common stock to 250,000,000.
(Continued, and to be signed, on the Reverse Side)
FOLD HERE
--------------------------------------------------------------------------------
THIS PROXY WHEN PROPERLY SIGNED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR PROPOSALS 1 AND 2.
The undersigned hereby acknowledges receipt of the Notice of, and Proxy
Statement for, the aforesaid Special Meeting.
Dated: __________________________________________ , 2008
________________________________________________________
Signature of Stockholder
________________________________________________________
Signature of Stockholder
NOTE: When shares are held by joint tenants, both should
sign. When signing as attorney, executor, administrator,
trustee, or guardian, please give full title as such. If
a corporation, please sign in full corporate name by
President or other authorized officer. If a partnership,
please sign in partnership name by an authorized person.
IMPORTANT - PLEASE FILL IN, SIGN AND RETURN PROMPTLY
USING THE ENCLOSED ENVELOPE.
AIR INDUSTRIES GROUP, INC.
P R O X Y
FOR HOLDERS OF SERIES B PREFERRED STOCK
FOR SPECIAL MEETING OF THE STOCKHOLDERS
FRIDAY, FEBRUARY 25, 2008
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Peter D. Rettaliata and Louis A. Giusto,
and each of them, with full power of substitution, as proxies to vote the shares
which the undersigned is entitled to vote at the Special Meeting of the
Stockholders of Air Industries Group, Inc. to be held at the offices of Eaton &
Van Winkle LLP, Three Park Avenue, 16th floor, New York, NY, on Friday, February
25, 2008 at 10:00 A.M., Eastern Time and at any adjournments thereof, hereby
revoking any proxies heretofore given, to vote all shares of series B
convertible preferred stock of Air Industries Group, Inc. held or owned by the
undersigned as indicated on the proposals as more fully set forth in this Proxy
Statement, and in their discretion upon such other matters as may come before
the meeting.
Please mark "X" your votes as indicated:
1. To grant to our board of directors discretionary authority to FOR AGAINST ABSTAIN
amend our certificate of incorporation to effect a reverse
stock split of our common stock at a ratio within the range
from one-for ten to one-for-thirty at any time prior to
December 31, 2008.
2. To approve an amendment to our certificate of incorporation FOR AGAINST ABSTAIN
that would increase the number of shares of our authorized
shares of common stock to 250,000,000..
(Continued, and to be signed, on the Reverse Side)
FOLD HERE
--------------------------------------------------------------------------------
THIS PROXY WHEN PROPERLY SIGNED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR PROPOSALS 1 AND 2.
The undersigned hereby acknowledges receipt of the Notice of, and Proxy
Statement for, the aforesaid Special Meeting.
Dated: __________________________________________ , 2008
________________________________________________________
Signature of Stockholder
________________________________________________________
Signature of Stockholder
NOTE: When shares are held by joint tenants, both should
sign. When signing as attorney, executor, administrator,
trustee, or guardian, please give full title as such. If
a corporation, please sign in full corporate name by
President or other authorized officer. If a partnership,
please sign in partnership name by an authorized person.
IMPORTANT - PLEASE FILL IN, SIGN AND RETURN PROMPTLY
USING THE ENCLOSED ENVELOPE.