Form of Lock-Up
Agreement


 


July , 2017


 


Roth Capital Partners, LLC
888 San Clemente Drive


Newport Beach, CA 92660


 


As Representative of the several


Underwriters to be named
in the


within-mentioned Underwriting Agreement


 


Re:    Air Industries Group –
Registered Public Offering of Common Stock


 


Dear Sirs:


 


As
a condition to the inclusion of the shares of common stock, par value $0.001 per share (“Common Stock”), of
Air Industries Group, a Nevada corporation (the “Company”), you acquired or may acquire upon conversion of the
Company’s Subordinated Convertible Notes due May 12, 2018 (the “ ”) in a registration statement to be filed by
the Company for the resale of those shares in a public offering pursuant to a prospectus included in that registration statement,
the undersigned hereby agrees that for a period (the “Lock-Up Period”) commencing on the date hereof and continuing
through the close of trading on October 10, 2017, the ninetieth (90th) day following the closing of the public offering for the
sale by the Company of 5,175,000 shares of Common Stock on July 12, 2017 pursuant to an Underwriting Agreement with Roth Capital
Partners, LLC, as representative of the several underwriters named in Schedule I annexed thereto (the “Representative”),
the undersigned will not, without the prior written consent of the Representative, directly or indirectly, (i) sell, assign, transfer,
pledge, offer to sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant
any option for sale (including any short sale), right or warrant to purchase, lend, establish an open “put equivalent position”
(within the meaning of Rule 16a-1(h) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
or otherwise dispose of, or enter into any transaction which is designed to or could be expected to result in the disposition of,
any shares of Common Stock or securities convertible into or exercisable or exchangeable for any equity securities of the Company
(including, without limitation, shares of Common Stock or any such securities which may be deemed to be beneficially owned by the
undersigned in accordance with the rules and regulations promulgated by the Securities and Exchange Commission from time to time
(such shares or securities, the “Beneficially Owned Shares”)), or publicly announce any intention to do any
of the foregoing, other than the exercise of options or warrants so long as there is no sale or disposition of the Common Stock
underlying such options or warrants during the Lock-Up Period, (ii) enter into any swap, hedge or other agreement or arrangement
that transfers in whole or in part, the economic risk of ownership of any Beneficially Owned Shares, Common Stock or securities
convertible into or exercisable or exchangeable for any equity securities of the Company, or (iii) engage in any short selling
of any Beneficially Owned Shares, Common Stock or securities convertible into or exercisable or exchangeable for any equity securities
of the Company, whether any such transaction described in clause (i), (ii) or (iii) above is to be settled by delivery of shares
of Common Stock or such other securities, in cash or otherwise.


 






    


    


    

 


In
addition, notwithstanding the foregoing, the restrictions set forth herein shall not apply to the establishment of a trading plan
that complies with Rule 10b5-1 under the Exchange Act; provided however, that the restrictions shall apply in full force
to sales pursuant to the trading plan during the Lock-Up Period. Furthermore, notwithstanding anything herein to the contrary,
this lock up will not apply to the sale of shares of Common Stock pursuant to a trading plan that complies with Rule 10b5-1 and
existing on the date of this Lock-Up Agreement.


 


Anything
contained herein to the contrary notwithstanding, any person to whom shares of Common Stock, securities convertible into or exercisable
or exchangeable for any equity securities of the Company or Beneficially Owned Shares are transferred from the undersigned shall
be bound by the terms of this Lock-Up Agreement. This Lock-Up Agreement is irrevocable and will be binding on the undersigned and
the respective successors, heirs, personal representatives, and assigns of the undersigned.


 


In
addition, the undersigned hereby waives, from the date hereof until the expiration of the Lock-Up Period, any and all rights, if
any, to request or demand registration pursuant to the Securities Act of 1933, as the same may be amended or supplemented from
time to time, of any shares of Common Stock or securities convertible into or exercisable or exchangeable for any equity securities
of the Company that are registered in the name of the undersigned or that are Beneficially Owned Shares. In order to enable the
aforesaid covenants to be enforced, the undersigned hereby consents to the placing of legends and/or stop transfer orders with
the transfer agent of the Common Stock with respect to any shares of Common Stock, securities convertible into or exercisable or
exchangeable for any equity securities of the Company or Beneficially Owned Shares.


 


Notwithstanding
the foregoing, and subject to the conditions below, the undersigned may transfer the Beneficially Owned Shares in the transactions
listed as clauses (i) - (vi) below without the prior written consent of the Representative, provided that (1) prior to each such
transfer, the Representative shall have received a duplicate form of this Lock-Up Agreement executed and delivered by each donee,
trustee, distributee or transferee, as the case may be, (2) no such transfer shall involve a disposition for value, (3) each such
transfer (other than transfers under clauses (ii) and (v) below) shall not be required to be reported as a reduction in beneficial
ownership in any public report, announcement or filing made or to be made with the Securities and Exchange Commission or otherwise
during the Lock-Up Period and (4) the undersigned does not otherwise voluntarily effect any public filing, announcement or report
regarding any such transfer during the Lock-Up Period:


 


		(i)	as a bona fide gift or gifts;



 


		(ii)	by operation of law, including pursuant to a qualified domestic order or in connection with a
divorce settlement;



 


		(iii)	to the immediate family of the undersigned;



 


		(iv)	to any trust for the direct or indirect benefit of the undersigned or the immediate family of
the undersigned;



 






    


    


    

 





	 	(v)	to any beneficiary of the undersigned pursuant to a will or other testamentary document or applicable laws of descent; or



 





	 	(vi)	to any corporation, partnership, limited liability company or other entity all of the beneficial ownership interests of which are
held by the undersigned or the immediate family of the undersigned.



 


This
Lock-Up Agreement shall not apply to: (i) the transfer of Beneficially Owned Shares pursuant to a bona fide third party tender
offer, merger, consolidation or other similar transaction made to all holders of the Common Stock involving a change of control
(as hereinafter defined) of the Company, provided that in the event that the tender offer, merger, consolidation or other such
transaction is not completed, the Beneficially Owned Securities owned by the undersigned shall remain subject to the restrictions
contained herein; (ii) transactions relating to shares of Common Stock or other securities acquired in open market transactions
after the completion of the registered public offering, provided that no filing under Section 16(a) of the Exchange Act shall be
required or shall be voluntarily made in connection with subsequent sales of Common Stock or other securities acquired in such
open market transactions; or (iii) transfers to the Company in connection with the exercise of options or warrants on a “cashless”
or “net exercise” basis or to cover tax withholding obligations, provided that any related filing under Section 16(a)
of the Exchange Act reporting a disposition of shares of Common Stock made in connection with such exercise shall contain a description
of the transaction and indicate that the disposition was made as part of such exercise or to cover tax withholding obligations
in connection therewith.


 


This
Lock-Up Agreement shall automatically terminate upon the consummation of a “change of control” of the Company, meaning
(a) the consummation of a reorganization, merger or consolidation, or sale or other disposition of all or substantially all of
the assets of the Company, or (b) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under such Act) of more than
fifty percent (50%) of either (i) the then outstanding shares of Common Stock of the Company; or (ii) the combined voting power
of the then outstanding voting securities of the Company entitled to vote generally in the election of directors.


 


This
Lock-Up Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.


 


(Remainder of page intentionally
left blank. Signature page to follow.)


 






    


    


    

 


This Lock-Up Agreement has been executed
as of the date first written above.


 





	________________________________


Printed Name of Holder

 

 

_________________________________


Printed
Name of Person Signing

 


	 

                            

                            

                           By:

                           Signature ___________________________

	Title or Capacity in Which Signing:
_________________________________


(and indicate capacity of person signing if signing as custodian, trustee, or on behalf of
an entity)