Air T Inc.
03/04/2026 | Press release | Distributed by Public on 03/04/2026 15:33
Management Change/Compensation (Form 8-K)
Item 5.02 Compensatory Arrangements of Certain Officers
Effective February 27, 2026, Air T, Inc. (the "Company") and Tracy Kennedy entered into a new employment agreement. Pursuant to the new employment agreement, Kennedy will remain the Company's Chief Financial Officer and she will be paid a base salary of $331,000 per year with the base salary to increase to $360,000 per year effective January 1, 2027 and to $397,000 per year effective January 1, 2028, payable in accordance with standard pay practices of the Company, less any applicable withholdings or deductions. In addition, Kennedy will be eligible to receive quarterly incentive compensation with the calculation of each quarterly award based on a 1-5 rating for Kennedy's performance in the preceding quarter. Each rating will represent a certain percentage bonus amount calculated off of that quarter's Base Salary (e.g. Base Salary divided by four then multiplied by the bonus percentage associated with the rating given for that quarter). The ratings-based percentages are as follows:
•Rating of 1: 0%
•Rating of 2: 10-30% (at CEO's discretion)
•Rating of 3: 50%
•Rating of 4: 70%
•Rating of 5: 90%+ (at CEO's discretion).
The Company may pause payment of any otherwise due and owing quarterly incentive compensation in the event the Company is in significant financial distress that would objectively impair the Company's existing debt obligations, as determined in the sole discretion of the Company. Kennedy's employment with the Company will remain at-will.
The Employment Agreement also provides for (i) insurance and other benefits in accordance with the Company's standard benefit package, (ii) four (4) weeks of vacation per year, subject to the terms and conditions of the Company's vacation policy, and (iii) certain restrictive covenants (non-competition, non-solicitation, non-disparagement and confidentiality). If the Company terminates the Employment Agreement for any reason other than for "Cause" (as defined in the Employment Agreement), then Kennedy shall be entitled to a severance payment equal to six (6) months plus one (1) month for each year of employment, up to a maximum of twelve (12) months of her base salary. Such severance payment is contingent upon the execution and delivery by Kennedy of a general release of all claims and the expiration of any applicable rescission period in connection therewith.
The foregoing description of the Employment Agreement is qualified in its entirety by reference to the full text of the Employment Agreement, which is attached to this Current Report on Form 8-K as Exhibit 10.1 and incorporated by reference herein.
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