Air Industries Group is no longer investing in the legacy milling business that earnings reports describe; the equity is now a tightly wound merger-arbitrage position in a pending all-stock combination with Tenax Aerospace Acquisition, a special mission aviation company. For the three months ended June 30, 2026, the legacy business reported net sales of $11,995,000, down 5.2% from the $12,659,000 year-ago quarter, and a net loss that widened to $846,000 from $422,000. The deeper signal sits off the income statement: the company signed an amended and restated merger agreement with Tenax on July 2, 2026 under which Air Industries issues 126,900,000 shares of its common stock to Tenax's members, a block worth roughly 96% of the post-closing company, while current shareholders are left with about 4%. The most recent print cannot be read as a standalone quarter because the ordinary-course business has been subordinated to a single binary event.
The mechanism is a change-of-control reverse merger dressed in an acquisition's clothing. Tenax, a provider of aircraft sourcing, financing, modification, and aviation services with close ties to government customers, becomes the economic owner of the combined entity, and the legacy precision components operation becomes a minority line inside a Tenax-led aviation company. The transaction eliminates Air Industries' post-closing tender offer obligation, replaces it with a set debt-adjusted share price of $3.05 per pre-split share ($15.25 after the required 1-for-5 reverse split), and requires Tenax to satisfy the Webster Bank credit facility and the Taglich-related subordinated notes at closing. In our view, the load-bearing question for the equity is not the shy single-digit revenue decline of the legacy business, but whether the merger closes on or before the newly extended Outside Date of November 30, 2026, and at what effective valuation the legacy shareholders are surrendered.
The single load-bearing risk is that the merger does not close, which would leave a going-concern issuer whose primary credit facility expires September 30, 2026 and whose related party subordinated notes mature October 1, 2026, with the lender having already stated it does not intend to renew. The financial statements carry an explicit going-concern paragraph for the twelve months following filing. The falsifiable clock is the S-4 registration statement and the proxy/prospectus, the stockholder vote on the charter amendment and the share issuance, and the extended Outside Date itself; a second extension beyond November 30, 2026, or a failure of the stockholder approvals, would test whether the Tenax path is real or merely a floor under a failing standalone business.