Butler National Corporation appointed Joe Aric Peters as a Class II director of the Company for a term expiring at the 2023 annual meeting of stockholders. The Board of Directors determined that Mr. Peters does not qualify as an independent director under applicable NASDAQ definitions and Mr. Peters was not appointed to any committee of the Company. Mr. Peters serves as the Company's Director of Sales and has an employment contract with the Company, which is summarized below.

Mr. Peters has been employed by the Company for 23 years. The Company's employment agreement with Mr. Peters commenced on January 1, 2020 and has an initial term through December 31, 2024. Unless the Employment Agreement is sooner terminated, or not renewed, it will automatically extend upon the expiration of its initial term for successive three 3 year periods.

The Employment Agreement may be terminated earlier: (i) by Mr. Peters with or without Good Reason (as defined in the Employment Agreement), (ii) by the Company with or without Cause (as defined in the Employment Agreement), (iii) as a result of Mr. Peters's death, permanent disability or incapacity or by mutual agreement between Mr. Peters and the Company. Under the Employment Agreement, Mr. Peters is entitled to receive the following compensation and benefits in connection with his services an annual base salary of $273,478. The base salary increases by (5%) on January 1 of each year for the initial term and any extension term and for calendar year 2022 is currently $296,067, eligibility to receive a discretionary annual bonus for certain long-term employees, provided that the Company is profitable,eligibility to participate in the Company's Management Incentive Bonus Plan and participation in all employee benefit programs.