{"url_path":"/sec/airi/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 EXECUTIVE COMPENSATION**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-03-27","source_url":"https://www.sec.gov/Archives/edgar/data/1009891/0001213900-26-035731-index.html","accession_number":"0001213900-26-035731","cik":"0001009891","ticker":"AIRI","issuer_name":"AIR INDUSTRIES GROUP","edgar_url":"https://www.sec.gov/Archives/edgar/data/1009891/0001213900-26-035731-index.html","primary_entity_key":"0001009891","primary_entity_name":"AIR INDUSTRIES GROUP"},"word_count":979,"has_tables":true,"body_markdown":"**ITEM 11. EXECUTIVE COMPENSATION**\n\n \n\nThe following summary compensation\ntable shows, for the periods indicated, information regarding the compensation awarded to, earned by or paid to each individual that served\nas our principal executive officer during the fiscal year ended December 31, 2025, each other individual that was serving as an executive\nofficer as of December 31, 2025, and each other individual who served as executive officer during the two years ended December 31, 2025\nwhose compensation for either of such fiscal years exceeded $100,000 for all services rendered in all capacities to our company and its\nsubsidiaries. The individuals listed in the following table are referred to herein collectively as our “Named Executive Officers.” \n\n \n\n**Summary Compensation Table**\n\n \n\nName and Principal\n\nPosition \nYear  \nSalary\n($)  \nBonus\n($)  \nStock\nawards\n($)  \nOption\nawards\n($)  \nNon-equity\nIncentive\nPlan\nInformation\n($)  \nNonqualified\ndeferred\ncompensation\nearnings\n($)  \nAll other\ncompensation\n($)  \nTotal\n($) \n\n  \n   \n   \n   \n   \n   \n   \n   \n   \n  \n\nLuciano Melluzzo* \n 2025  \n 389,758  \n —  \n —  \n —  \n —  \n —  \n 10,800(1)  \n 400,558 \n\nPresident and CEO \n 2024  \n 374,566  \n —  \n 620,350  \n —  \n —  \n —  \n 10,800(1)  \n 1,005,716 \n\nScott Glassman \n 2025  \n 233,331  \n —  \n —  \n —  \n —  \n —  \n —  \n 233,331 \n\nCFO** \n 2024  \n 224,231  \n —  \n 371,363  \n —  \n —  \n —  \n —  \n 595,594 \n\n \n\n(*)\nMr. Melluzzo resigned from his position effective March 11, 2026.\n\n(**)\nMr. Glassman was appointed Acting Chief Executive Officer and President effective March 18, 2026.\n\n(1)\nRepresents car allowance.\n\n* *\n\nOur executive officers named\nin the above table do not have employment agreements providing for a fixed term of employment. All are employees at will, terminable at\nany time without any severance, other than that payable to employees generally.\n\n \n\n**Executive Compensation Policies as They Relate to Risk Management**\n\n \n\nThe Compensation Committee and management have considered whether our\ncompensation policies might encourage inappropriate risk taking by our executive officers and other employees. The Compensation Committee\nhas determined that the current compensation structure aligns the interests of the executive officers with those of the Company without\nproviding rewards for excessive risk taking by awarding a mix of fixed and performance based or discretionary bonuses with the performance-based\ncompensation focused on profits as opposed to revenue growth.\n\n \n\nThe Compensation Committee\nworking with management adopts a plan each year intended to award members of our management including executive officers for meeting or\nexceeding targeted goal. As these goals were not met for 2025, the Committee believes the amounts to be paid to Messrs. Melluzzo and\nGlassman for services rendered in fiscal 2025 are appropriate.\n\n \n\n41\n\n \n\n \n\n**Outstanding Equity Awards at 2025 Year-End**\n\n \n\nThe following table shows\ncertain information regarding outstanding equity awards held by our Named Executive Officers as of December 31, 2025.\n\n \n\n  \nOption Awards  \n  \nStock Awards \n\nName \nNumber of\nSecurities\nUnderlying\nUnexercised\nOptions (#)\nExercisable  \nNumber of\nSecurities\nUnderlying\nUnexercised\nOptions (#)\nUnexercisable  \nOption\nExercise\nPrice\n($)  \nOption\nExpiration\nDate \nEquity Incentive\nPlan Awards:\nNumber of\nUnearned Shares,\nUnits or Other\nRights That Have\nNot Vested\n(#)  \n**Equity\nIncentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not\nVested (1)\n($)** \n\nLuciano Melluzzo \n 48,000  \n —  \n$3.43  \n6/30/2028 \n 68,245(2)  \n$209,512 \n\n  \n 27,000  \n —  \n 3.50  \n5/31/2028 \n —  \n — \n\n  \n 20,000  \n —  \n 8.30  \n3/31/2027 \n —  \n — \n\n  \n 18,000  \n —  \n 12.20  \n7/31/2026 \n —  \n — \n\n  \n 15,000  \n —  \n 13.90  \n3/31/2026 \n —  \n — \n\n  \n    \n    \n    \n  \n    \n   \n\nScott Glassman \n 5,000  \n —  \n$3.50  \n5/31/2028 \n 40,854(2)  \n$125,422 \n\n  \n 4,100  \n —  \n 3.43  \n6/30/2028 \n —  \n — \n\n  \n 3,000  \n —  \n 8.40  \n3/31/2027 \n —  \n — \n\n  \n 2,000  \n —  \n 12.20  \n7/31/2026 \n —  \n — \n\n  \n 2,250  \n —  \n 13.90  \n3/31/2026 \n —  \n — \n\n \n\n(1)\nThe dollar amounts shown in this column are determined by multiplying the number of shares or units in the preceding column by $3.07, the closing price of the Company’s common stock on December 31, 2025.\n\n \n \n\n(2)\nOne-third of the RSUs subject to these awards were released on April 1, 2025, and subject to the terms of the award agreements, the remainder of the RSUs are scheduled to vest in two equal annual installments commencing on April 1, 2026. Based on Mr. Melluzzo’s retirement, it was agreed that the awards to be received on April 1, 2026, would be released, and those for 2027 will be forfeited.\n\n \n\n**Equity Incentive Plans**\n\n \n\nWe have three equity incentive plans all of which\nare substantially identical except as to the number of awards which may be granted, pursuant to which we can grant awards with respect\nto an aggregate of 1,055,000 shares of our common stock. We have the right to grant awards pursuant to each plan until the tenth anniversary\nof the date on which it was approved by our stockholders.  The 2022 Equity Incentive Plan was approved by our stockholders in June\n2022; and amendments to the 2022 Equity Incentive Plan were approved by our stockholders at our Annual Meeting in 2023 and 2024, and most\nrecently at our Annual Meeting in 2025 to increase the number of shares as to which grants may be awarded to 900.000; the 2017 Equity\nIncentive Plan authorizes grants as to 120,000 shares and was approved by our stockholders in October 2017; and the 2016 Equity Incentive\nPlan authorizes grants as to 35,000 shares and was approved by our stockholders in November 2016.\n\n \n\n42\n\n \n\n \n\nThe Plans permit the Company\nto grant stock awards, non-qualified and incentive stock options, restricted stock units and other forms of rewards to employees, directors\nand consultants. The Plans are administered by the Compensation Committee of the Board and each has a term of ten years from the date\nit was adopted by the Board.\n\n  \n\nWe adopted the Plans to provide\na means by which employees, directors, and consultants of our Company and those of our subsidiaries and other designated affiliates, which\nwe refer to together as our affiliates, may be given an opportunity to purchase our common stock, to assist in retaining the services\nof such persons, to secure and retain the services of persons capable of filling such positions, and to provide incentives for such persons\nto exert maximum efforts for our success and the success of our affiliates."}