Exhibit 10.23

 
THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS COVERING SECURITIES
REGISTERED UNDER THE SECURITIES ACT OF 1933.

AIR T, INC.
STOCK APPRECIATION RIGHT AGREEMENT
(2005 EQUITY INCENTIVE PLAN)

THIS AGREEMENT, made effective as of the _____ day of ________, 20__ (the “Grant
Date”), by and between Air T, Inc. (the “Company”), and ___________________ (the
“Holder”).

WHEREAS, the Company has adopted the Air T, Inc. 2005 Equity Incentive Plan (the
“Plan”) in order to provide additional incentives to certain employees and
directors and consultants of the Company and its Subsidiaries; and

WHEREAS, Section 5.1 of the Plan provides for the award of Stock Appreciation
Rights to Employees of the Company and its Subsidiaries; and

WHEREAS, the Holder has been awarded Stock Appreciation Rights under the Plan to
be evidenced by this Agreement;

NOW, THEREFORE, the parties hereto agree as follows:

1.  
Grant of Stock Appreciation Right. Pursuant to Section 5.1 of the Plan, the
Company hereby grants to the Holder a Stock Appreciation Right that entitles the
Holder to receive, in Common Stock or, to the extent that a cash payment would
be in compliance with Section 409A of the Code, cash, value equal to (or
otherwise based on) the excess of: (i) the Fair Market Value of __________
shares of Common Stock on the date of exercise; over (ii) the exercise price of
$ __.__ per share. The value per share of Common Stock to be delivered to the
Holder upon exercise of the Stock Appreciation Right shall be the Fair Market
Value of a share of Common Stock on the date of exercise or the next preceding
date if such date is not a trading date.

 

2.  
Duration of Stock Appreciation Right. Subject to the terms of the Plan, the
Stock Appreciation Right shall remain exercisable for [select one]:

ten years after the Grant Date;
 
other (specify; may be no later than ten years after the Grant Date):
________________________________________________________________________
________________________________________________________________________

3.  
Vesting and Exercisability of Stock Appreciation Right. Subject to the terms of
the Plan, the Stock Appreciation Right shall vest and be exercisable [select
one]

 
with respect to
 

 
(i)
one-third (1/3) of the shares of Common Stock covered by the Stock Appreciation
Right beginning on the first anniversary of the Grant Date,

 

 
(ii)
an additional one-third (1/3) of the shares of Common Stock covered by the Stock
Appreciation Right beginning on the second anniversary of the date of the Grant
Date, and

 

 
(iii)
the remaining one-third (1/3) of the shares of Common Stock covered by the Stock
Appreciation Right beginning on the third anniversary of the Grant Date.

 
other (specify):
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________

4.  
Acceleration of Vesting upon Change of Control. (select one)

 
In the event of a Change of Control, the Stock Appreciation Right shall become
fully exercisable and vested to the full extent of the original grant.

A Change of Control shall not affect the exercisability or vesting of the Stock
Appreciation Right.

5.  
Termination of Service. In the event of the termination of the Holder’s Service,
the Stock Appreciation Right shall terminate in full (whether or not previously
exercisable) prior to the expiration of its term [select one]:

 

   
on the date thirty (30) days after the date of the termination of the Holder’s
Service, unless the Holder’s Service is terminated due to the Holder’s:

 

 
(i)
death, in which case the Holder’s legatee(s) under the Holder’s last will or the
Holder's personal representative or representatives may exercise all or part of
the previously unexercised portion of the Stock Appreciation Right at any time
within one year, but not beyond the expiration of its term, after the Holder's
death to the extent the Holder could have exercised the Stock Appreciation Right
immediately prior to the Holder’s death;

 

 
(ii)
Disability, in which case the Holder or the Holder’s personal representative may
exercise the previously unexercised portion of the Stock Appreciation Right at
any time within one year, but not beyond the expiration of its term, after the
termination of the Holder’s Service to the extent the Holder could have
exercised the Stock Appreciation Right prior to such termination; or

 

 
(iii)
Retirement, in which case the Holder may exercise the previously unexercised
portion of the Stock Appreciation Right at any time within one year, but not
beyond the expiration of its term, after the Holder's Retirement to the extent
the Holder could have exercised the Stock Appreciation Right immediately prior
to Retirement.

other (specify):
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________

6.  
Exercise of Stock Appreciation Right. The Holder may exercise all or a portion
of the Stock Appreciation Right by giving written notice to the Company of
exercise, specifying the number of shares of Common Stock with respect to which
the Stock Appreciation Right is being exercised. Such notice is to be delivered
to the Secretary of the Company and is effective as of the date of receipt by
the Secretary of the Company.

 

7.  
Purchase of Stock Appreciation Right. The Company, upon approval by the
Committee, may elect to purchase the Stock Appreciation Right by paying the
Holder an amount, in cash or Common Stock, equal to the product of (i) the
excess of the Fair Market Value per share of the Common Stock subject to the
Stock Appreciation Right over the exercise price per share, and (ii) the number
of shares of Common Stock subject to the Stock Appreciation Right.

 

8.  
Non-Transferability of Stock Appreciation Right. The Stock Appreciation Right
shall not be transferable by the Holder except to the extent permitted under the
Plan.

 

9.  
No Rights as a Stockholder. The Holder shall not have any rights or privileges
of a stockholder with respect to any shares of Common Stock by virtue of the
Stock Appreciation Right until the date of issuance by the Company of a
certificate for such shares pursuant to the exercise of the Stock Appreciation
Right.

 

10.  
Holder Bound by the Plan. The Holder hereby acknowledges receipt of a copy of
the Plan and agrees to be bound by all the terms and provisions thereof. A
determination of the Committee as to any questions which may arise with respect
to the interpretation of the provisions of this Agreement and of the Plan shall
be final. The Committee may authorize and establish such rules, regulations and
revisions thereof not inconsistent with the provisions of the Plan, as it may
deem advisable.

 

11.  
Modification of Agreement. This Agreement may be modified, amended, suspended or
terminated, and any terms or conditions may be waived, but only by a written
instrument executed by the parties hereto.

 

12.  
Severability. Each provision of this Agreement is intended to be severable.
Should any provision of this Agreement be held by a court of competent
jurisdiction to be unenforceable or invalid for any reason, the remaining
provisions of this Agreement shall not be affected by such holding and shall
continue in full force in accordance with their terms.

 

13.  
Governing Law; Jurisdiction. This Agreement shall be governed and construed in
accordance with the laws of the State of North Carolina, without regard to the
principles of conflicts of law, except to the extent governed by federal law.
Each party hereby irrevocably submits to the jurisdiction of the state and
federal courts sitting in Catawba County, State of North Carolina, for the
adjudication of any dispute hereunder.

 

14.  
Successors in Interest. This Agreement shall inure to the benefit of and be
binding upon any successor to the Company. This Agreement shall inure to the
benefit of the Holder’s legal representatives. All obligations imposed upon the
Holder and all rights granted to the Company under this Agreement shall be
final, binding and conclusive upon the Holder’s heirs, executors, administrators
and successors.

 
IN WITNESS WHEREOF, this Agreement has been executed by the Company and the
Holder effective as of the date and year first written above.

AIR T, INC.
 
 
By: __________________________________
Title:_________________________________
   
__________________________________
[Holder]