Company: AIRTP
Filing Date: 2025-02-12
Form Type: 10-Q
Source: 0000353184-25-000009
Chunk: 56

Company: AIR T INC
Filing Date: 2025-02-12
Form: 10-Q
Item: Item 8
Chunk 56
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, the ability to exercise vested awards, occurring at the conclusion of each annual vesting period, is contingent upon the Company's stock price meeting predetermined milestones outlined in the options agreements (the "market condition"). If the market condition is not fulfilled at the annual vesting period on June 30 of every year, the vested awards may not be exercisable at any subsequent point. On the preceding three vesting dates, June 30, 2024, 2023 and 2022, a total of 97,000 shares satisfied the service condition; however, they did not meet the market condition to become exercisable. For the three and nine months ended December 31, 2024, no unvested shares and 26,000 unvested shares, respectively, were forfeited due to employee departures resulting in the reversal of previously recognized expense of $0 and $53.0 thousand, respectively. For the three and nine months ended December 31, 2024, total compensation cost recognized under the Plan was $30.0 thousand and $0.1 million. As of December 31, 2024, there were 203,000 granted options that may become exercisable on future vesting dates under the Plan. No options were exercisable as of December 31, 2024.

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17.     Guarantees

Nonfinancial GuaranteesFrom time to time, we may issue guarantees or indemnifications to third parties assuring performance of lease agreements pertaining to aircraft assets owned by certain CJVII Series ("nonfinancial guarantees"). Air T's performance under these guarantees would be triggered by failure of the series to perform in accordance with the terms stated in the lease agreements.Nonfinancial guarantees and indemnifications are recorded at fair value at their inception. We regularly review our performance risk under these arrangements, and in the event it becomes probable that we will be required to perform under a guarantee or indemnity, the amount of probable payment will be recorded.The maximum potential payments for nonfinancial guarantees were $4.5 million and $10.1 million at December 31, 2024 and March 31, 2024, respectively. The reduction in the maximum potential payments required for nonfinancial guarantees this quarter, compared to March 31, 2024, stems from a strategic decision to sell the aircraft instead of maintaining it on lease, thereby mitigating future payment obligations for the underlying asset. The carrying value of recorded liabilities related to nonfinancial guarantees