15.	AIR T, INC. STOCKHOLDERS’ EQUITY

The authorized capital structure of Air T, Inc. includes

4,000,000

shares of common stock, with a par value of

$0.25

per share. In

May 2014,

the Company’s Board of Directors adopted a policy to discontinue the payment of a regularly scheduled annual cash dividend.

May 14, 2014,

the Company announced that its Board of Directors had authorized a program to repurchase up to

750,000

shares of the Company’s common stock from time to time on the open market or in privately negotiated transactions, in compliance with SEC Rule

10b

18,

over an indefinite period.

In addition to common stock, the Company

may

issue up to

50,000

shares of

$1.00

par value preferred stock, in

one

or more series, on such terms and with such rights, preferences and limitations as determined by the Board of Directors. A total of

5,000

shares of preferred stock are authorized for issuance as Series A Junior Participating Preferred Stock and

5,000

shares of preferred stock are authorized for issuance as Series B Junior Participating Preferred Stock, of which

3,000

shares had been reserved for issuance pursuant to the Company’s former Rights Agreement, described below.

December 14, 2014,

the Board of Directors declared a dividend of

one

preferred share purchase right (a “Right”) for each outstanding share of common stock of the Company. The Rights were governed by a Rights Agreement (the “Rights Agreement”) dated as of

December 15, 2014.

September 26, 2016,

a special committee of independent members of the Company’s Board of Directors, under authority delegated to such committee by the Board of Directors of the Company, resolved to amend the Rights Agreement to accelerate the expiration of the Rights (as defined in the Rights Agreement) from

5:00

p.m., Eastern time, on

December 26, 2017

5:00

p.m., Eastern time, on

September 26, 2016.

Thereafter, on

September 26, 2016,

the Company entered into an amendment to the Rights Agreement to accelerate the expiration of the Rights from

5:00

p.m., Eastern time, on

December 26, 2017

5:00

p.m., Eastern time, on

September 26, 2016 (

the “Final Expiration Time”). As a result of such amendment, the Rights Agreement was effectively terminated on

September 26, 2016

and all of the Rights distributed to holders of the Company’s common stock pursuant to the Rights Agreement expired at the Final Expiration Time.

July 1, 2016,

the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Sardar Biglari, Biglari Capital Corp. and The Lion Fund II, L.P. (collectively, the “Biglari Group”), pursuant to which the Company purchased

329,738

shares of common stock, par value

$0.25

(the “Common Stock”), of the Company for

$24.01

per share (the “Per Share Purchase Price”), resulting in an aggregate purchase price of

$7,917,009.

The Per Share Purchase Price was equal, and determined by reference, to the volume-weighted average price of the Common Stock for the

thirty

(

) trading days preceding the date of the Securities Purchase Agreement.

Pursuant to the terms of the Securities Purchase Agreement, for a period of

four

years following the date of the Securities Purchase Agreement, each member of the Biglari Group agreed to customary standstill restrictions (including customary provisions regarding matters submitted to shareholders and other governance matters), and the parties to the Securities Purchase Agreement agreed to abide by customary non-disparagement provisions in connection with the parties’ relationship with the Company.

The Common Stock repurchased from the Biglari Group was retired upon repurchase. The accompanying consolidated statement of equity for the year ended

March 31, 2017

reflects the resultant respective reductions in common stock, additional paid-in capital, and retained earnings.