Item 1.01 Entry into a Material Definitive Agreement
On November 18, 2021, Air T, Inc. (the “Company”) and Air T Funding (the “Trust”) entered into a First Amendment to the At the Market Offering Agreement (the “ATM Amendment”) with Ascendiant Capital Markets, LLC (the “sales agent” or “Ascendiant”). Pursuant to the ATM Amendment, the aggregate offering amount of Alpha Income Preferred Securities (the “Capital Securities”) which the Trust may sell and issue through Ascendiant ,as the Trust’s sales agent in the ATM Offering, was increased from $8,000,000 to $12,000,000 (the “ATM Offering”). The Trust has no obligation to sell any of the Capital Securities, and may at any time suspend offers under the ATM Agreement, as amended or terminate the ATM Agreement, as amended.
Sales of the Capital Securities, if any, under the ATM Agreement, as amended may be made in transactions that are deemed to be “at-the-market” equity offerings as defined in Rule 415 under the Securities Act of 1933, as amended, including sales made by means of ordinary brokers’ transactions, including on the NASDAQ Stock Market. Subject to the terms and conditions of the ATM Agreement, as amended the sales agent will use its reasonable efforts to sell the Capital Securities from time to time based upon the Trust’s instructions (including any price, time, or size limits or other parameters or conditions the Trust may impose). The Trust or the Company will pay the sales agent a commission of up to 3.0% of the gross sales price of any Capital Securities sold under the ATM Agreement, as amended. The Trust has also provided the sales agent with customary indemnification rights.
The Capital Securities will be offered and sold pursuant to the Company’s and the Trust’s shelf registration statement on Form S-3 (File Nos. 333-254110-01 and 333-254110). On November 18, 2021, the Company and the Trust filed a prospectus supplement relating to the ATM Offering and ATM Agreement, as amended with the Securities and Exchange Commission.
Under the terms of the ATM Agreement, as amended the Trust may also sell Capital Securities to Ascendiant as principal for its own account at a price agreed upon at the time of the sale, subject to the Trust entering into a separate terms agreement with Ascendiant for any such sale.
The description of the ATM Amendment does not purport to be complete and is qualified in its entirety by reference to the First Amendment to the ATM Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K. The original ATM Agreement, was filed as Exhibit 10.1 to the Current Report on Form 8-K filed on May 14, 2021, which is incorporated by reference to this filing. The copy of the ATM Agreement, as amended, has been included to provide investors with information regarding its terms and is not intended to provide any other factual information about the Company or the Trust. The representations, warranties, and covenants contained in the ATM Agreement, as amended were made only for purposes of the ATM Agreement, as amended as of the specific dates therein, are solely for the benefit of the parties to the ATM Agreement, as amended may be subject to limitations agreed upon by the contracting parties, including, among others, being qualified by disclosures made for the purposes of allocating contractual risk between the parties instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under the ATM Agreement, as amended and should not rely on the representations, warranties, and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company or the Trust. Moreover, information concerning the subject matter of representations and warranties may change after the date of the ATM Agreement, as amended which subsequent information may or may not be fully reflected in the Company’s or the Trust’s public disclosures. Rather, investors and the public should look to the disclosures contained in the Company’s reports under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
The legal opinion relating to the Capital Securities being offered pursuant to the ATM Agreement, as amended is filed as an exhibit to this Current Report on Form 8-K.
This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy the securities discussed herein, nor shall there be any offer, solicitation, or sale of the securities in any state in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state.