{"url_path":"/sec/airi/10-k/2026/item-3","section_key":"item-3","section_title":"Item 3 LEGAL PROCEEDINGS**","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":457,"has_tables":true,"body_markdown":"**ITEM 3. LEGAL PROCEEDINGS**\n\n \n\nOn October 2, 2018, Contract Pharmacal Corp. (“Contract\nPharmacal”) commenced an action, relating to a Sublease entered into between the Company and Contract Pharmacal in May 2018 with\nrespect to the property that was formerly occupied by the Company’s former subsidiary WMI, at 110 Plant Avenue, Hauppauge, New York.\nIn the action, Contract Pharmacal sought damages for an amount in excess of $1,000,000 for the Company’s alleged violation of the\nterms of the subject sublease, specifically the failure to make the entire premises available by what it claims was the Sublease commencement\ndate. The validity of the action is extremely suspect in that the subject sublease had no specific commencement date and Contract Pharmacal\nultimately received all the space. Discovery was conducted and the Plaintiff moved for summary judgement and to amend its complaint to\nadd a new cause of action all of which the company opposed. On July 8, 2021, the Court denied Contract Pharmacal’s motion for summary\njudgement and to add an additional cause of action. In the Order, the Court granted Contract Pharmacal’s Motions to drop its claim\nfor specific performance and to amend its Complaint to reduce its claim for damages to $700,000 both of which benefit the Company. Following\nthe Court’s decision, Contract Pharmacal filed a Motion to reargue its original motion which the Company opposed. The Court denied\nthat motion on November 30, 2021 and then on March 10, 2022, Contract Pharmacal filed an appeal of the Court’s decision with the\nAppellate Division of the State of New York. The Company opposed that action. The Company was again successful as the Appellate Division\nupheld the lower court’s denial of Contract Pharmacal’s motion for summary judgement and its motion to amend its Complaint.\nContract Pharmacal has now submitted a motion to the Appellate Division requesting leave to reargue the court’s denial of its original\nappeal. The Company will oppose that motion. The Appellate Division has yet to act in respect to Contract Pharmacal’s most recent\nmotion to reargue the Court’s denial of the original appeal. The Company continues to dispute the validity of the claims asserted\nby Contract Pharmacal and intends to contest them vigorously.\n\n \n\nFrom time to time we may be engaged in various\nlawsuits and legal proceedings in the ordinary course of our business. We are currently not aware of any legal proceedings the ultimate\noutcome of which, in our judgment based on information currently available, would have a material adverse effect on our business, financial\ncondition or operating results. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial\nstockholder of our common stock, is an adverse party or has a material interest adverse to our interest."}