TIMCO AVIATION SERVICES INC
POST-CLOSING RESOLUTION AGREEMENT
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>3
<FILENAME>dex101.txt
<DESCRIPTION>POST-CLOSING RESOLUTION AGREEMENT
<TEXT>
<PAGE>

                                                                    EXHIBIT 10.1

                                                                  EXECUTION COPY

                       POST-CLOSING RESOLUTION AGREEMENT

     This Post-Closing Resolution Agreement (this "Agreement") is entered into
as of February 18, 2002 among Kellstrom Industries, Inc., a Delaware corporation
("Kellstrom"), Aviation Sales Company, a Delaware corporation ("AVS"), and
Aviation Sales Distribution Services Company, a Delaware corporation (the
"Company").

                                   RECITALS

     The parties are parties to an Asset Purchase Agreement dated September 20,
2000 (as amended, the "Asset Purchase Agreement").  Out of the Asset Purchase
Agreement have arisen a number of issues, claims, rights and obligations by and
among the parties hereto.  In an effort to avoid the costs and expenses
associated with protracted litigation or arbitration over such matters, the
parties hereto intend that this Agreement shall constitute an overall settlement
of such issues, claims, rights and obligations on the terms and subject to the
conditions contained in this Agreement.  Initial capitalized terms used herein
but not otherwise defined herein shall have the meanings given to them in the
Asset Purchase Agreement.

                              TERMS OF AGREEMENT

     In consideration of the mutual representations, warranties, covenants and
agreements contained herein, the parties hereto agree as follows:

                                   ARTICLE I

                                  DEFINITIONS

     1.1   Defined Terms.  As used herein, the following terms shall have the
           -------------
following meanings:

           "Actual Related Unpaid Assumed Payables" means those Related Unpaid
           Assumed Payables that remain unpaid as of December 31, 2001, as set
           forth on Exhibit "A", which, in the aggregate, equal $3,642.
                    -----------

           "Actual Settled RMA Amount" means the sum of the credits issued, or
           agreed by Kellstrom to be issued, in respect of Settled RMAs as of
           December 31, 2001 to the extent set forth on Exhibit "B", which, in
                                                        -----------
           the aggregate, equals $892,691.54.

           "Actual Unpaid Receivables" means the Purchased Receivables that
           remain unpaid or unsatisfied as of December 31, 2001, as set forth on
           Exhibit "C", as adjusted on the Resolution Closing Date for changes
           -----------
           through such date.
<PAGE>

          "Actual Unpaid Receivables Amount" means the sum of Actual Unpaid
          Receivables, which, in the aggregate, equals $5,238,141.86, which
          amount shall be adjusted on the Resolution Closing Date for changes
          through such date.

          "Amendment to Non-Competition Agreement" means that certain First
          Amendment to Non-Competition Agreement, in the form attached as
          Exhibit "D" hereto.
          -----------

          "AVS DTs" means certain of those amounts due and owing by Kellstrom to
          AVS and its Affiliates (other than in connection with the Asset
          Purchase Agreement, the Inventory Purchase Agreement or the agreements
          and transactions contemplated thereby) as of December 31, 2001, as set
          forth on Exhibit "E" hereto, that the parties have agreed will be
                   -----------
          resolved pursuant to this Agreement, which, in the aggregate, equal
          $1,069,742.

          "Bankruptcy Court" means any court having jurisdiction over a
          bankruptcy proceeding commenced by Kellstrom under Title 11 of the
          United States Code.

          "Bill of Sale, Assignment and Assumption" means a bill of sale,
          assignment and assumption agreement executed by Kellstrom, AVS and the
          Company, pursuant to which Kellstrom shall assign, and the Company
          shall assume, the Actual Related Unpaid Assumed Payables, and
          Kellstrom shall transfer the Actual Unpaid Receivables to the Company.

          "Equipment" shall have the meaning given to it in the Equipment Lease.

          "Equipment Bill of Sale" means a bill of sale executed by the Company
          in form reasonably satisfactory to Kellstrom pursuant to which the
          Company shall convey title to the Equipment to Kellstrom, wherein the
          Company shall represent and warrant to Kellstrom that the Company has
          good and marketable title to the Equipment free and clear of any
          liens, with full power to sell the Equipment; provided, however, that
          the representations (except as to title) contained in such bill of
          sale shall not survive beyond the survival of the representations of
          the Company with respect to conveyed assets contained in the Asset
          Purchase Agreement.

          "Equipment Lease" means that certain Equipment Lease Agreement dated
          December 1, 2000 among AVS, the Company and Kellstrom, as supplemented
          by the Equipment Option Letter.

                                       2
<PAGE>

          "Equipment Option Letter" means that certain letter agreement dated
          December 1, 2000, among the parties with respect to the Equipment
          Lease.

          "Kellstrom DTs" means certain of those amounts due and owing by AVS
          and its Affiliates to Kellstrom and its Affiliates (other than in
          connection with the Asset Purchase Agreement or the agreements and
          transactions contemplated thereby), as of December 31, 2001, as set
          forth on Exhibit "F" hereto, that the parties have agreed will be
                   -----------
          resolved pursuant to this Agreement, which, in the aggregate, equal
          $1,769,609.

          "LC Lender Documents" means the Option Agreement, in the form attached
          as Exhibit "G" hereto, the Memorandum of Option Agreement, in the form
             -----------
          attached as Exhibit "H" hereto, the Memorandum of Termination of
                      -----------
          Purchase and Sale Agreement, in the form attached as Exhibit "I"
                                                               -----------
          hereto, and an Amendment to that certain Intercreditor Agreement dated
          as of December 1, 2000 by and between Bank of America, N.A., as agent
          under Kellstrom's senior credit facility, and the LC Lenders, pursuant
          to the terms attached as Exhibit "J" hereto.
                                   -----------

          "LC Lenders" means James Ventures, L.P., Robert Belfer, LJH, Ltd. and
          Don A. Sanders.

          "Miramar Documents" means the First Amendment to Lease, in the form
          attached as Exhibit "K" hereto, the Amended and Restated Memorandum of
                      -----------
          Lease, in the form attached as Exhibit "L" hereto, the Amended and
                                         -----------
          Restated Subordination, Non-Disturbance and Attornment Agreement, in
          the form attached as Exhibit "M" hereto, and the Consent to Lease
                               -----------
          Amendment, in the form attached as Exhibit "N" hereto.
                                             -----------

          "Miramar Facility" means the facility located at 3701 Flamingo Road,
          Miramar, FL 33027.

          "Miramar Lease" means that certain Lease dated as of December 1, 2000
          by and between AVS and Kellstrom.

          "Open RMA" means an RMA issued to a customer for which Kellstrom has
          not issued a credit or agreed to issue a credit as of the Closing.

          "Parts Purchase Discount" means a 15% discount on purchases of parts
          by AVS and its affiliates from Kellstrom in the ordinary

                                       3
<PAGE>

          course of business (subject to customary sales credit limitations
          generally applied by Kellstrom to its customers), up to an aggregate
          discount of $200,000.

          "Related Unpaid Assumed Payables" means those Assumed Payables that
          were acquired by Kellstrom pursuant to the Asset Purchase Agreement
          that are due to an account that has an Actual Unpaid Receivable.

          "Resolution Transaction Documents" means:

             . the Bill of Sale, Assignment and Assumption;
             . the Equipment Bill of Sale;
             . the RMA Acknowledgment (hereinafter defined);
             . the Kellstrom DT Acknowledgment (hereinafter defined);
             . the AVS DT Acknowledgment (hereinafter defined);
             . the Amendment to Non-Competition Agreement;
             . the LC Lender Documents;
             . the Miramar Documents; and
             . any other document required to be executed in connection
               herewith.

          "RMA" means a Return Materials Authorization issued by Kellstrom or
          AVS (as to AVS, prior to December 1, 2000) to a customer in connection
          with equipment subject to a Purchased Receivable.

          "Settled RMA" means an RMA pursuant to which Kellstrom has issued, or
          agreed to issue, a credit to the customer as set forth on Exhibit "B"
                                                                    -----------
          hereto.

          "Terms of KAV Consignment" means the terms set forth on Exhibit "O"
                                                                  -----------
          hereto.


                                  ARTICLE II

                            EXERCISE OF PUT OPTIONS

    2.1  Exercise of Equipment Put Option.  Notwithstanding any notice or timing
         --------------------------------
requirements set forth in the Equipment Option Letter, the parties agree and
consent to the exercise by the Company, effective as of the Resolution Closing
Date, of that certain option set forth in the Equipment Option Letter thereby
requiring Kellstrom to purchase the Equipment pursuant to the terms of the
Equipment Option Letter, as supplemented and/or modified by this Agreement.

                                       4
<PAGE>

    2.2  Exercise of Purchased Receivables Put Option.  The parties acknowledge
         --------------------------------------------
that on or about December 27, 2001 Kellstrom exercised its option pursuant to
Section 6.18 of the Asset Purchase Agreement to require the Company to purchase
------------
the Actual Unpaid Receivables (to the extent unpaid through December 1, 2001).
The purchase of the Actual Unpaid Receivables shall be consummated on the
Resolution Closing Date pursuant to the terms of the Asset Purchase Agreement,
as supplemented and/or modified by this Agreement.  From the date hereof until
the earlier to occur of (a) the Resolution Closing Date or (b) the termination
of this Agreement, Kellstrom shall forbear from exercising its rights under the
Asset Purchase Agreement to collect the Actual Unpaid Receivables.

                                  ARTICLE III

                         RESOLUTION OF PURCHASE PRICE
                        UNDER ASSET PURCHASE AGREEMENT
                       AND INVENTORY PURCHASE AGREEMENT

     3.1  Resolution of Purchase Price Under Asset Purchase Agreement.  The
          ------------------------------------------------------------
parties hereto acknowledge and agree that the Company and Kellstrom have
determined the Actual Cash Purchase Price on or prior to the date hereof, as
evidenced by the execution and delivery of an Actual Cash Purchase Price
Certificate, a copy of which is attached hereto as Attachment I, and as a
                                                   ------------
result, the sum of $680,823 is owing to Kellstrom by the Company (the "Actual
Cash Purchase Price Adjustment"). Effective as of the Resolution Closing Date,
Kellstrom, on the one hand, and AVS and the Company, on the other, release one
another from any and all claims, causes of action, liabilities, obligations and
damages, whether now, or later known, which they ever had, or now have, or may
have in the future arising out of Section 2.6 of the Asset Purchase Agreement,
                                  -----------
provided, however, that such release shall not affect or release any of the
obligations of the parties set forth in this Agreement or any other obligations
of the parties set forth in the Asset Purchase Agreement including, without
limitation, with respect to Indemnifiable Damages (as defined in the Asset
Purchase Agreement) unrelated to Section 2.6 thereof.
                                 -----------

     3.2  Resolution of Purchase Price Under Inventory Purchase Agreement.  The
          ----------------------------------------------------------------
parties hereto acknowledge and agree that the Company and the Kellstrom
Managers, on behalf of KAV, have determined the Actual Purchase Price (as such
term is defined in the Inventory Purchase Agreement) on or prior to the date
hereof and that such Actual Purchase Price is equal to the Estimated Purchase
Price (as such term is defined in the Inventory Purchase Agreement).  In this
regard, the parties acknowledge that no adjustments to the purchase price are
required under the Inventory Purchase Agreement pursuant to Section 2.5 thereof
                                                            -----------
and, subject to Section 13.12 and Section 14.11 hereof, the parties hereby waive
                -------------     -------------
the requirement for the execution and delivery of an Actual Purchase Price
Certificate.  KAV executes and joins in this Agreement for the sole purpose of
acknowledging and demonstrating its acceptance of and agreement with this
Section 3.2, subject to Section 13.12 and Section 14.11 hereof.  Effective as of
------------            -------------     -----------
the Resolution Closing Date, the Company, on the one hand, and KAV, on the
other, release one another from any and all claims, causes of action,
liabilities, obligations and damages, whether now, or later known, which they
ever had, or now have, or may have in the future arising out of Section 2.5 of
                                                                -----------
the Inventory Purchase Agreement, provided that such release shall not affect or
release any of the obligations of the parties set

                                       5
<PAGE>

forth in this Agreement or any other obligations of the parties set forth in the
Inventory Purchase Agreement including, without limitation, with respect to
Indemnifiable Damages (as defined in the Inventory Purchase Agreement) unrelated
to Section 2.5 thereof.
   -----------

                                  ARTICLE IV

                                  PURCHASE OF
                     EQUIPMENT SUBJECT TO EQUIPMENT LEASE
                   AND PURCHASE OF ACTUAL UNPAID RECEIVABLES

     4.1  Purchase of Equipment.  Pursuant to the exercise by the Company of the
          ---------------------
option set forth in the Equipment Option Letter as set forth in Section 2.1
                                                                -----------
above, at the Closing the Company shall sell, convey, transfer, assign and
deliver to Kellstrom, and Kellstrom shall purchase, the Equipment, free and
clear of any Liens.  In this regard, the parties acknowledge and agree that the
purchase price for the Equipment shall be $7,738,567 (the "Equipment Purchase
Price").

     4.2  Purchase of Actual Unpaid Receivables; Parts Purchase Discount.
          --------------------------------------------------------------
Pursuant to the exercise by Kellstrom of the option contained in Section 6.18 of
                                                                 ------------
the Asset Purchase Agreement as set forth in Section 2.2 above, at the Closing,
                                             -----------
Kellstrom shall sell, convey, transfer, assign and deliver to the Company, and
the Company shall purchase, the Actual Unpaid Receivables, free and clear of any
Liens.  In this regard, the parties acknowledge and agree that the purchase
price for the Actual Unpaid Receivables is $6,127,191.40, constituting the
Actual Unpaid Receivables Amount (as of December 31, 2001), less the Actual
Related Unpaid Assumed Payables, plus the Actual Settled RMA Amount (the "Unpaid
Receivables Purchase Price").  Notwithstanding the terms of Section 6.18(c) of
                                                            ---------------
the Asset Purchase Agreement, the parties acknowledge and agree that such amount
shall not be subject to the credit toward the purchase of services from AVS and
its Affiliates equal to the Receivables Credit Amount.  Additionally, from and
after the Closing, Kellstrom agrees to provide AVS with the Parts Purchase
Discount.

     4.3  Assumed Payables.  The Company and AVS agree jointly and severally to
          ----------------
assume and pay, discharge and perform all of the obligations, duties and
liabilities of Kellstrom with respect to the Actual Related Unpaid Assumed
Payables after Closing and hereby indemnify Kellstrom from and against any
obligation thereunder.

     4.4  Release; Audit Rights.  From and after the Resolution Closing Date,
          ---------------------
(a) the parties hereby release each other from their respective obligations
pursuant to Section 6.18 of the Asset Purchase Agreement, and (b) AVS and the
            ------------
Company hereby release Kellstrom from any obligations it may have under the
Asset Purchase Agreement with respect to Actual Related Unpaid Assumed Payables.
Notwithstanding the foregoing, Kellstrom acknowledges and agrees that the
Company shall have the right, for a period of ninety (90) days after the
Resolution Closing Date (during normal business hours and upon reasonable prior
notice), in which to conduct and complete an audit (at the Company's sole cost
and expense) of the Purchased Receivables (including the Actual Unpaid
Receivables), and the Actual Related Unpaid Assumed Payables to confirm (a) the
application of proceeds received by Kellstrom with respect to the

                                       6
<PAGE>

Purchased Receivables and (b) the validity and existence of the Actual Unpaid
Receivables and the Actual Related Unpaid Assumed Payables. Kellstrom shall
cooperate fully in connection with any such audit and shall promptly respond to
all requests for, and promptly provide, any and all information and/or
documentation in its possession, custody or control that are relevant to any of
the foregoing. Any adjustments resulting from such audit shall be paid from one
party to the other, as appropriate, within fifteen (15) days after completion of
any such audit.

                                   ARTICLE V

                           AVS DTs AND KELLSTROM DTs

     5.1  Settlement of AVS DTs.  Kellstrom acknowledges and agrees that the AVS
          ---------------------
DTs are due and owing to AVS as of the date hereof.  At the Closing, AVS shall
acknowledge in writing that the AVS DTs have been satisfied (the "AVS DT
Acknowledgement").

     5.2  Settlement of Kellstrom DTs.  The Company and AVS acknowledge and
          ---------------------------
agree that the Kellstrom DTs are due and owing to Kellstrom as of the date
hereof.  At the Closing, Kellstrom shall acknowledge in writing that the
Kellstrom DTs have been satisfied (the "Kellstrom DT Acknowledgement").

                                  ARTICLE VI

                                 MIRAMAR RENT

     6.1  Payment of Miramar Rent.  The parties agree that (notwithstanding the
          ------------------------
terms of the Miramar Lease) from the date hereof until the earlier to occur of:
(a) the Closing; or (b) the termination of this Agreement pursuant to Section
                                                                      -------
15.1 hereof (the "Interim Rental Period"), Kellstrom shall pay a monthly amount
----
(the "Interim Rental Amount") equal to the lesser of (i) $384,037.50, or (ii)
81.4% of the Debt Service (as defined below), in either case, plus applicable
sales taxes, to AVS for the lease of the Miramar Facility, and, if Kellstrom
pays each such Interim Rental Amount when due under the Miramar Lease, AVS shall
be estopped during the Interim Rental Period from claiming any defaults or
taking any action against Kellstrom under the Miramar Lease as a result of any
claims that any other or additional rent may become due during the Interim
Rental Period.  For purposes of this Section, the term "Debt Service" shall mean
the accrued interest payments required to be paid by AVS under the terms of the
loan financing secured by the Miramar Facility in effect on the date hereof. In
the event that the loan financing secured by the Miramar Facility shall be
refinanced, the term "Debt Service" shall mean the regularly scheduled monthly
installment of principal and interest on such loan; provided, however, that,
notwithstanding the actual terms of such loan, in no event shall any such
installment exceed the amount of a monthly installment of principal and interest
that would be payable pursuant to a 25 year fully amortized loan in the
principal amount of the new loan secured solely by the Miramar Facility (which
new principal amount shall be deemed not to exceed the outstanding principal
amount of the loan financing secured by the Miramar Facility on the date hereof)
upon commercially reasonable terms.  The Interim Rental Amount shall be prorated
for any period of the Interim Rental Period that is less than a full calendar
month based on the actual number of days during such month falling within the
Interim Rental Period.

                                       7
<PAGE>

     6.2  Additional Miramar Rent.  At the Closing, Kellstrom shall pay to AVS
          -----------------------
an amount (the "Additional Interim Rent") that is equal to the sum of 100% of
the actual Debt Service paid by AVS for each month of the Interim Rental Period
minus the Interim Rental Amount actually paid by Kellstrom for each such month
of the Interim Rental Period. The prorated amount of the actual Debt Service
paid by AVS shall be used to determine the portion of the Additional Interim
Rent due for any period less that a full month during the Interim Rental Period.
In addition, should the actual Debt Service paid by AVS during any month of the
Interim Rental Period exceed the amount of $384,037.50, then the amount of
$384,037.50 shall be the amount used in lieu of the actual Debt Service paid by
AVS in determining the portion of the Additional Interim Rent due for such
monthly period. In addition to the above, at Closing, Kellstrom shall pay to AVS
an amount equal to $68,498 representing the additional rent amounts claimed by
AVS to be due under the Miramar Lease and not previously paid by Kellstrom for
the period from December 31, 2001 through February 28, 2002 (the "Miramar
Supplemental Rent").

     6.3  Reservation of Rights.  Subject to the provisions of Section 15.2
          ---------------------                                ------------
hereof, in the event that this Agreement is terminated, the provisions of
Sections 6.1 and 6.2 hereof shall not constitute any waivers of any of the
--------------------
parties' rights relating to any amounts that may be claimed to be due and
payable under the Miramar Lease.

                                  ARTICLE VII

                                 SETTLEMENT OF
                                  ALL AMOUNTS

     7.1  Settlement.  The parties hereby agree that at the Closing, in
          ----------
settlement of all the disputes with respect to the amounts set forth in this
Agreement, including (i) the Equipment Purchase Price, (ii) the Unpaid
Receivables Purchase Price, (iii) the AVS DTs, (iv) the Kellstrom DTs, (v) the
Miramar Supplemental Rent, and (vi) the Actual Cash Purchase Price Adjustment,
all such obligations shall be reconciled by the payment from Kellstrom to AVS of
an amount equal to $299,183.60 (subject to adjustment for changes in the Actual
Unpaid Receivables Amount), plus the amount of the Additional Interim Rent in
connection with the transactions contemplated by this Agreement.

                                 ARTICLE VIII

                           TERMINATION OF AGREEMENTS

     8.1  Termination of Cooperation Agreement.  The parties hereby agree and
          ------------------------------------
consent that, pursuant to Article V of that certain Cooperation Agreement dated
as of December 1, 2000 (the "Cooperation Agreement") among Kellstrom, AVS and
the Company, the Cooperation Agreement is hereby terminated effective as of the
Resolution Closing Date.

     8.2  Termination of Sub-Sublease.  The parties hereby acknowledge and agree
          ---------------------------
that the Sub-Sublease dated as of August 1, 2001 by and between Kellstrom and
AVS has been terminated effective as of December 31, 2001.

                                       8
<PAGE>

                                  ARTICLE IX

                                    CLOSING

     9.1  The Closing.  Subject to the terms and conditions of this Agreement,
          -----------
the closing of the transactions contemplated herein (the "Closing") shall take
place on a date mutually selected by the parties hereto within three (3) days
after the satisfaction or waiver of the conditions set forth in Articles XIII
                                                                -------------
and XIV of this Agreement at the offices of Akerman, Senterfitt & Eidson, P.A.,
-------
Ft. Lauderdale, Florida (the "Resolution Closing Date").

     9.2  Closing Deliveries.  At the Closing, the following shall occur:
          ------------------

          (a)  Kellstrom shall transfer the Actual Unpaid Receivables to the
               Company, together with all documentation related to such Actual
               Unpaid Receivables (including, without limitation, all invoices,
               shipping documents, proof of delivery, and customer
               correspondence) to the extent that the same was provided by the
               Company to Kellstrom and/or generated/received by Kellstrom
               following the Closing under the Asset Purchase Agreement;

          (b)  Kellstrom shall acknowledge in writing that the Actual Unpaid
               Receivables made the subject of the Settled RMAs included in the
               Actual Settled RMA Amount have ceased to be an unpaid Purchased
               Receivable and that Kellstrom shall remain responsible for, and
               indemnify the Company against any claims relating to, any Open
               RMAs at Closing and any RMAs that may be issued by Kellstrom
               after the Closing (the "RMA Acknowledgment");

          (c)  Kellstrom shall transfer the Actual Related Unpaid Assumed
               Payables to the Company (the "Transferred Payables");

          (d)  Kellstrom shall execute and deliver the Kellstrom DT
               Acknowledgment, and AVS shall execute and deliver the AVS DT
               Acknowledgment;

          (e)  Kellstrom, the Company and AVS shall execute the Resolution
               Transaction Documents to which each is party; and

          (f)  The parties shall execute and deliver, or cause to be executed
               and delivered, such other documents as each is required by this
               Agreement to execute and deliver, or cause to be executed and
               delivered.

                                       9
<PAGE>

                                   ARTICLE X

                       REPRESENTATIONS AND WARRANTIES OF
                              THE COMPANY AND AVS

     As a material inducement to Kellstrom to enter into this Agreement and to
consummate the transactions contemplated hereby, the Company and AVS, jointly
and severally, make the following representations and warranties to Kellstrom:

     10.1  Corporate Status.  Each of the Company and AVS is a corporation duly
           ----------------
organized, validly existing and in good standing under the laws of the State of
Delaware and has the requisite power and authority to own or lease its
properties and to carry on its business as now being conducted.  There is no
pending or threatened proceeding for the dissolution, liquidation, insolvency or
rehabilitation of the Company or AVS.

     10.2  Power and Authority.  Each of the Company and AVS has the corporate
           -------------------
power and authority to execute and deliver this Agreement and each of the
Resolution Transaction Documents to which the Company and/or AVS is a party, to
perform its respective obligations hereunder and thereunder and to consummate
the transactions contemplated hereby and thereby.  Each of the Company and AVS
has taken all corporate action necessary to authorize the execution and delivery
of this Agreement and each of the Resolution Transaction Documents to which the
Company and/or AVS is a party, the performance of its obligations hereunder and
thereunder and the consummation of the transactions contemplated hereby and
thereby.

     10.3  Enforceability.  This Agreement and each of the Resolution
           --------------
Transaction Documents to which the Company and/or AVS is a party have been duly
executed and delivered by each of the Company and AVS, and constitutes the
legal, valid and binding obligation of each of them, enforceable against each of
them in accordance with their terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and general equitable
principles regardless of whether such enforceability is considered in a
proceeding at law or in equity.

     10.4  No Violation/Consents.  Except as set forth on Schedule 10.4, none of
           ---------------------                          -------------
the execution or delivery of this Agreement by the Company or AVS and each of
the Resolution Transaction Documents to which the Company and/or AVS is a party,
the performance by the Company or AVS of their respective obligations hereunder
and thereunder or the consummation by the Company or AVS of the transactions
contemplated hereby or thereby will (i) contravene any provision of the
Certificate of Incorporation or Bylaws (or other organizational documents), as
amended to date, of the Company or AVS, (ii) violate or conflict with any Legal
Requirement or any decree, writ, injunction, judgment or order of any
Governmental Authority or of any arbitration award which is either applicable
to, binding upon or enforceable against the Company or AVS, (iii) conflict with,
result in any breach of, or constitute a default (or an event which would, with
the passage of time or the giving of notice or both, constitute a default)
under, or give rise to a right to terminate, amend, modify, abandon or
accelerate, any Contract, (iv) result in or require the creation or imposition
of any Lien upon or with respect to the Equipment, or (v) require the consent,
approval, authorization or permit of, or filing with or notification to, any

                                       10
<PAGE>

Governmental Authority, any court or tribunal or any other Person, except any
SEC filings required to be made by the parties.

     10.5  Litigation.  There is no action, suit, or other legal or
           ----------
administrative proceeding or governmental investigation pending or Threatened by
or against the Company, AVS or any of the Equipment which relates to or
questions the validity or enforceability of this Agreement and the Resolution
Transaction Documents or the transactions contemplated hereby and thereby. There
are no outstanding orders, decrees or stipulations issued by any Governmental
Authority in any proceeding to which the Company is or was a party which have
not been complied with in full by the Company or which continue to impose any
material obligations on the Company or which may have a Material Adverse Effect
on the Equipment.

     10.6  Good Title to Equipment.  Except as set forth on Schedule 10.6, the
           -----------------------                          -------------
Company has good and marketable title to all of the Equipment.  As of the
Resolution Closing Date, the Company will own the Equipment and AVS and/or the
Company will own the accounts and any other rights comprising the AVS DTs, free
and clear of any Liens, with full power to sell, transfer, set-off and assign
the same to and with Kellstrom free and clear of any Liens.

     10.7  No Commissions.  None of AVS, the Company or any other Affiliate of
           --------------
AVS has incurred any obligation for any finder's or broker's or agent's fees or
commissions or similar compensation in connection with the transactions
contemplated hereby, other than fees which will be paid by, and are the sole
obligation of, AVS, the Company or any other Affiliate of AVS.

                                  ARTICLE XI

                  REPRESENTATIONS AND WARRANTIES OF KELLSTROM

     As a material inducement to AVS and the Company to enter into this
Agreement and to consummate the transactions contemplated hereby, Kellstrom
makes the following representations and warranties to AVS and the Company:

     11.1  Corporate Status.  Kellstrom is a corporation duly organized, validly
           ----------------
existing and in good standing under the laws of the State of Delaware and has
the requisite power and authority to own or lease its properties and to carry on
its business as now being conducted.

     11.2  Power and Authority.  Kellstrom has the corporate power and authority
           -------------------
to execute and deliver this Agreement and each of the Resolution Transaction
Documents to which it is a party, to perform its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and thereby.
Kellstrom has taken all corporate action necessary to authorize the execution
and delivery of this Agreement and each of the Resolution Transaction Documents
to which it is a party, the performance of its obligations hereunder and
thereunder and the consummation of the transactions contemplated hereby and
thereby.

     11.3  Enforceability.  This Agreement and each of the Resolution
           --------------
Transaction Documents to which Kellstrom is a party have been duly executed and
delivered by Kellstrom, and constitutes the legal, valid and binding obligation
of Kellstrom, enforceable against

                                       11
<PAGE>

Kellstrom in accordance with their terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and general equitable
principles regardless of whether such enforceability is considered in a
proceeding at law or in equity.

     11.4  No Violation/Consents.  Except as set forth on Schedule 11.4, none of
           ---------------------                          -------------
the execution or delivery of this Agreement by Kellstrom and each of the
Resolution Transaction Documents to which Kellstrom is a party, the performance
by Kellstrom of its obligations hereunder and thereunder or the consummation by
Kellstrom of the transactions contemplated hereby or thereby will (i) contravene
any provision of the Certificate of Incorporation or Bylaws (or other
organizational documents), as amended to date, of Kellstrom, (ii) violate or
conflict with any Legal Requirement or any decree, writ, injunction, judgment or
order of any Governmental Authority or of any arbitration award which is either
applicable to, binding upon or enforceable against Kellstrom, (iii) conflict
with, result in any breach of, or constitute a default (or an event which would,
with the passage of time or the giving of notice or both, constitute a default)
under, or give rise to a right to terminate, amend, modify, abandon or
accelerate, any Contract, (iv) result in or require the creation or imposition
of any Lien upon or with respect to the Actual Unpaid Receivables or Transferred
Payables, or (v) require the consent, approval, authorization or permit of, or
filing with or notification to, any Governmental Authority, any court or
tribunal or any other Person, except any SEC filings required to be made by the
parties.

     11.5  Litigation.  There is no action, suit, or other legal or
           ----------
administrative proceeding or governmental investigation pending or Threatened by
or against Kellstrom or the Actual Unpaid Receivables which relates to or
questions the validity or enforceability of this Agreement and the Resolution
Transaction Documents or the transactions contemplated hereby and thereby. There
are no outstanding orders, decrees or stipulations issued by any Governmental
Authority in any proceeding to which Kellstrom is or was a party which have not
been complied with in full by Kellstrom or which continue to impose any material
obligations on Kellstrom or which may have a Material Adverse Effect on the
Actual Unpaid Receivables.

     11.6  Good Title.  Except as set forth on Schedule 11.6, Kellstrom has good
           ----------                          -------------
and marketable title to all of the Actual Unpaid Receivables.  Kellstrom will as
of the Resolution Closing Date own the Actual Unpaid Receivables and the
accounts and any other rights comprising the Kellstrom DTs free and clear of any
Liens, with full power to sell, transfer, set-off and assign the same to and
with the Company or AVS, as applicable, free and clear of any Liens.  Kellstrom
makes no representation or warranty whatsoever regarding the collectibility of
the Actual Unpaid Receivables.

     11.7  No Commissions.  Kellstrom has not incurred any obligation for any
           --------------
finder's or broker's or agent's fees or commissions or similar compensation in
connection with the transactions contemplated hereby, other than fees which will
be paid by, and are the sole obligation of, Kellstrom.

                                       12
<PAGE>

                                  ARTICLE XII

                             ADDITIONAL AGREEMENTS

     12.1  Further Assurances.  Each party shall execute and deliver such
           ------------------
additional instruments and other documents and shall take such further actions
as may be necessary or appropriate to effectuate, carry out and comply with all
of the terms of this Agreement and the Resolution Transaction Documents and the
transactions contemplated hereby and thereby.

     12.2  Compliance with Covenants.  At the Closing, the Company and AVS
           -------------------------
covenant and agree to deliver to Kellstrom the documents required to be
delivered to Kellstrom pursuant to Articles IX and XIII, and Kellstrom covenants
                                   --------------------
and agrees to deliver to the Company and AVS the documents required to be
delivered to the Company and AVS pursuant to Articles IX and XIV.
                                             -------------------

     12.3  Cooperation.  Each of the parties agrees to use its commercially
           -----------
reasonable best efforts to cooperate with the others in the preparation and
filing of all forms, notifications, reports and information, if any, required or
deemed advisable pursuant to any law, rule or regulation (including, without
limitation, any rules or regulations of any securities exchange upon which the
securities of Kellstrom or AVS may be listed or traded) in connection with the
transactions contemplated by this Agreement and the Resolution Transaction
Documents, and to use its best efforts to agree jointly on a method to overcome
any objections by any Governmental Authority to any such transactions.

     12.4  Other Actions.  Each of the parties hereto shall (i) take all
           -------------
appropriate reasonable actions to do, or cause to be done, all things necessary,
proper or advisable under any applicable laws, rules and regulations and
contracts to which each is a party to consummate and make effective the
transactions contemplated herein, including, without limitation, obtaining all
licenses, permits, consents, approvals, authorizations, qualifications and
orders of any Governmental Authority and parties to Contracts to which each is a
party as are necessary for it to consummate the transactions contemplated
hereby, (ii) use commercially reasonable efforts to make on a prompt and timely
basis all governmental or regulatory notifications and filings required to be
made by it to consummate and make effective the transactions contemplated
hereby, (iii) defend all lawsuits or other legal proceedings brought against it
which challenge this Agreement or the consummation of the transactions
contemplated hereby, and (iv) take all actions necessary or advisable to lift or
rescind any injunction or restraining order or other order adversely affecting
its ability to consummate the transactions contemplated hereby. Notwithstanding
the foregoing, the parties acknowledge that any refusal by Kellstrom's lenders
to approve this Agreement and the transactions contemplated hereby as a result
of the terms of the LC Lender Documents shall not be deemed a violation by
Kellstrom of this Section 12.4 or a waiver of the condition set forth in Section
                  ------------                                           -------
14.5.
----

     12.5  Delivery of Property Received by Kellstrom After Closing.  From and
           --------------------------------------------------------
after the Closing, the Company shall have the right and authority to collect,
for the account of the Company, all Actual Unpaid Receivables and other items
which shall be transferred to the Company as provided in this Agreement, and to
endorse with the name of the Company on any

                                       13
<PAGE>

checks or drafts received on account of any such receivables. Kellstrom agrees
that it will transfer or deliver to the Company, promptly after the receipt
thereof, any cash or other property which Kellstrom has received prior to, or
may receive after, the Resolution Closing Date in respect of any Actual Unpaid
Receivables transferred to the Company hereunder. Kellstrom further agrees and
acknowledges that from and after the Resolution Closing Date (i) it has no legal
or beneficial interest of any kind or nature in any cash or other property which
it may come to receive or possess related to or arising out of the Actual Unpaid
Receivables, and (ii) if it comes to receive or possess any cash or other
property related to or arising out of the Actual Unpaid Receivables, it receives
or possesses such cash or property solely as agent and in trust for the Company,
and shall, immediately remit such cash or other property, in the form received,
to the Company. The Company shall have the right to take any and all actions
that it may deem necessary in order to collect the Actual Unpaid Receivables
transferred to it hereunder.

     12.6  Execution of Further Documents.  The parties shall from and after the
           ------------------------------
Closing execute, acknowledge and deliver all such further deeds, bills of sale,
assignments, transfers, conveyances, notices to account debtors, powers of
attorney and assurances as may be requested by the other to convey and transfer
to the other and protect its right, title and interest in all of the assets
being transferred hereunder and to carry out the transactions contemplated by
this Agreement and the other Resolution Transaction Documents.

     12.7  Lien Releases and Estoppel Letters.  At or prior to Closing, the
           ----------------------------------
parties shall deliver to each other such UCC-3 termination statements,
satisfactions, estoppel letters or other appropriate releases as shall be
necessary to transfer the Equipment and the Actual Unpaid Receivables, and to
provide for the set-off of the AVS DTs and the Kellstrom DTs, free and clear of
all liens and encumbrances whatsoever.

     12.8  Performance of Obligations Under and Extension of the Termination
           -----------------------------------------------------------------
Date of Equipment Lease.  Notwithstanding section 365(d)(10) of the Bankruptcy
------------------------
Code or any other language contained herein to the contrary, Kellstrom shall
timely perform any and all obligations arising from or under the Equipment Lease
as they become due from and after the execution of this Agreement until the
Termination Date (as defined in the Equipment Lease), and from and after the
commencement of Kellstrom's bankruptcy until the Termination Date.  Further,
notwithstanding the terms of the Equipment Lease or the Equipment Option Letter,
the parties hereby consent and agree that the term "Termination Date" (as
defined in the Equipment Lease) of the Equipment Lease is hereby amended to mean
the earlier to occur of (a) the Resolution Closing Date or (b) August 31, 2002.

     12.9  Execution of Resolution Transaction Documents.  Prior to or at
           ---------------------------------------------
Closing, Kellstrom, the Company and AVS shall enter into each of the Resolution
Transaction Documents to which it is a party.

     12.10  Support of KAV Consignment.  AVS hereby agrees that it shall, and
            --------------------------
shall cause the Managers (as such term is defined in that certain Operating
Agreement of KAV Inventory, LLC ("KAV") effective as of September 20, 2000,
between AVS and Kellstrom) appointed by AVS to, and the Managers shall,
unequivocally and actively support to third parties on behalf of AVS and KAV a
consignment agreement among KAV, KIAC, Inc., a Delaware corporation, or

                                       14
<PAGE>

such other party that is the successful bidder for the assets of Kellstrom (as
debtor-in-possession) as approved by the Bankruptcy Court (in either case, the
"Successor Party"), and Bank of America, N.A., as agent, on terms substantially
similar to the Terms of KAV Consignment, provided, however, that the Managers
appointed by AVS shall not be obligated to incur or suffer any cost, expense,
obligation or liability in connection with supporting such new consignment
agreement.

     12.11  Certain KAV Engine. In the event that AVS obtains title to that
            ------------------
certain Pratt & Whitney model JT8-7B aircraft engine bearing manufacturer's
serial number  655220, currently owned by KAV and located in Oscoda, Michigan,
in satisfaction of repair costs incurred by AVS, Kellstrom hereby waives
applicability of the Non-Competition Agreement to the sale by AVS of such engine
as a whole engine and any such sale shall not be included in the sublimit
established by section (b) of the definition of "Permitted Activities" contained
in the Amendment to Non-Competition Agreement.

     12.12  Certain Landing Gear.  As soon as AVS provides Air Alliance
            --------------------
Materials with an appropriate credit for the return of a certain landing gear
cylinder (part number 015T1504-82 as sold under order number R331255 and bearing
serial number 7304) returned by Air Alliance Materials, Kellstrom shall assign
its rights to such landing gear cylinder to AVS and AVS may resell the landing
gear free of any restriction contained in the Non-Competition Agreement and any
such sale shall not be included in the sublimit established by section (b) of
the definition of "Permitted Activities" contained in the Amendment to Non-
Competition Agreement.


                                 ARTICLE XIII

                  CONDITIONS TO THE OBLIGATIONS OF KELLSTROM

     The obligations of Kellstrom to effect the transactions contemplated hereby
shall be subject to the fulfillment at or prior to the Resolution Closing Date
of the following conditions, any or all of which may be waived in whole or in
part in writing by Kellstrom (except as otherwise set forth herein):

     13.1  Compliance with Obligations.  The Company and AVS shall have
           ---------------------------
performed and complied with all of their respective obligations required by this
Agreement and in each of the Resolution Transaction Documents to which the
Company and/or AVS are parties to be performed or complied with at or prior to
the Resolution Closing Date.  The Company and AVS shall have delivered to
Kellstrom a certificate, dated as of the Resolution Closing Date, duly signed by
their respective President and Chief Financial Officer, certifying that all such
obligations have been performed and complied with.

     13.2  Consents.  The Company, AVS and Kellstrom shall each have received
           --------
all necessary consents to the transactions contemplated hereby from any Person
from whom such consent or waiver is required or pursuant to any Legal
Requirement.

                                       15
<PAGE>

     13.3  No Adverse Litigation.  There shall not be pending any action or
           ---------------------
proceeding by or before any court or other governmental body which shall seek to
restrain, prohibit, invalidate or collect damages arising out of the
transactions contemplated hereby.

     13.4  Delivery of Purchased Assets.  The Company shall have duly executed
           ----------------------------
and delivered to Kellstrom the Equipment Bill of Sale and such other instruments
of transfer of title as are reasonably necessary in the opinion of Kellstrom to
transfer to Kellstrom good and marketable title to the Equipment, in each case,
in form and substance reasonably satisfactory to Kellstrom.  The Company shall
deliver the Equipment to Kellstrom free and clear of any Liens.

     13.5  Delivery of Lien Releases and Estoppel Letters.  The Company and AVS
           ----------------------------------------------
shall have delivered to Kellstrom the lien releases and other documents referred
to in Section 12.7 hereof.
      ------------

     13.6  Execution and Delivery of Resolution Transaction Documents.  Each of
           ----------------------------------------------------------
the parties (other than Kellstrom) to the Resolution Transaction Documents shall
have executed and delivered the Resolution Transaction Documents to which it is
a party.

     13.7  Consent of Kellstrom Lenders.  Kellstrom shall have received the
           ----------------------------
prior written consent of Bank of America, N.A., as agent, under the Loan
Agreement (hereinafter defined) and any consent required to be obtained from its
lenders.

     13.8  Approval of the Bankruptcy Court.  The Bankruptcy Court shall have
           --------------------------------
issued a final (unless otherwise agreed) order approving this Agreement, the
Resolution Transaction Documents and the transactions contemplated hereby and
thereby.

     13.9  Closing of Asset Purchase Transaction.  Kellstrom (as debtor-in-
           -------------------------------------
possession) shall have consummated a transaction for the purchase of its assets
with the Successor Party.

     13.10  Execution of KAV Consignment.  KAV, the Successor Party and Bank of
            ----------------------------
America, N.A., as agent, shall have entered into a consignment agreement on
terms which are substantially similar to the Terms of KAV Consignment.

     13.11  Execution of General Release.  AVS and the Company shall use their
            ----------------------------
best efforts to cause the LC Lenders to execute and deliver, a general, mutual
release with Bank of America, N.A., as agent and the other lenders under that
certain Amended and Restated Loan and Security Agreement dated as of December
14, 1998 (as amended, the "Loan Agreement") among Kellstrom, certain of its
subsidiaries named therein, the financial institutions party to the Loan
Agreement from time to time, and Bank of America, N.A., as agent, which general,
mutual release shall cover any and all claims arising through the Resolution
Closing Date and be in form reasonably and mutually satisfactory to Bank of
America, N.A. and the LC Lenders; provided, however, that neither AVS nor the
                                  --------  -------
Company shall be obligated to incur any cost or expense in connection with
securing such release from the LC Lenders.  This condition shall not be waivable
by Kellstrom except with the prior written consent of Bank of America, N.A.

                                       16
<PAGE>

     13.12  Consent of KAV Lender.  KAV Inventory, LLC shall have received a
            ---------------------
consent from its lenders regarding the Amendment to Non-Competition Agreement
and the provisions of Section 3.2 hereof.
                      -----------

                                  ARTICLE XIV

                       CONDITIONS TO THE OBLIGATIONS OF
                              THE COMPANY AND AVS

     The obligations of the Company and AVS to effect the transactions
contemplated hereby shall be subject to the fulfillment at or prior to the
Resolution Closing Date of the following conditions, any or all of which may be
waived in whole or in part in writing by the Company or AVS:

     14.1  Compliance with Obligations.  Kellstrom shall have performed and
           ----------------------------
complied with all of its obligations required by this Agreement and in each of
the Resolution Transaction Documents to which it is a party to be performed or
complied with by it at or prior to the Resolution Closing Date.  Kellstrom shall
have delivered to the Company a certificate, dated as of the Resolution Closing
Date, and signed by its President and Chief Financial Officer, certifying that
all such obligations have been complied with and performed.

     14.2  No Adverse Litigation.  There shall not be pending any action or
           ---------------------
proceeding by or before any court or other governmental body, which shall seek
to restrain, prohibit, invalidate or collect damages arising out of the
transactions contemplated hereby.

     14.3  Delivery of Purchased Assets.  Kellstrom shall have duly executed and
           ----------------------------
delivered to the Company and AVS the Bill of Sale, Assignment and Assumption and
such other instruments of transfer as are reasonably necessary in the opinion of
the Company to transfer to the Company good and marketable title to the Actual
Related Unpaid Assumed Payables and Actual Unpaid Receivables, in each case, in
form and substance reasonably satisfactory to the Company.

     14.4  Delivery of Lien Releases and Estoppel Letters.  Kellstrom shall have
           ----------------------------------------------
delivered to the Company the lien releases and other documents referred to in
Section 12.7 hereof.
------------

     14.5  Execution and Delivery of Certain Resolution Transaction Documents.
           ------------------------------------------------------------------
Each of the parties (other than AVS and the Company) to the Resolution
Transaction Documents shall have executed and delivered the Resolution
Transaction Documents to which it is a party.

     14.6  Consents.  The Company and AVS shall have received consents to the
           --------
transactions contemplated hereby from any Person from whom such consent is
required or pursuant to any other Legal Requirement.

     14.7  Consent of AVS Senior Lenders.  AVS shall have received any consent
           -----------------------------
required to be obtained from its lenders under (a) that certain Fourth Amended
and Restated Credit Agreement dated May 31, 2000, as amended, between AVS and
Citicorp USA, Inc., as Agent,

                                       17
<PAGE>

and (b) that certain Participation Agreement dated as of December 17, 1998 (the
"Participation Agreement"), as amended, by and among AVS, as construction agent,
AVS, as lessee, First Security Bank, National Association, not individually,
except as expressly stated therein, but solely as Owner trustee under the
Aviation Sales Trust 1998-1, the various banks and other lending institutions
which parties thereto from time to time, as the holders, and the various banks
and other lending institutions which are parties thereto from time to time, as
the lenders, and NationsBank, National Association, as Administrative Agent for
the lenders, as amended.

     14.8  Extension of Financing/Lease on Miramar Facility.  The term of the
           ------------------------------------------------
Lease between Wells Fargo Bank Northwest, National Association, f/k/a First
Security Bank, National Association, as Lessor, and Aviation Sales Company, as
Lessee, dated as of December 17, 1998 for property including that located at
3701 Flamingo Road, Miramar, Florida 33027 and the maturity date of the
Operative Agreements (as that term is defined in the Participation Agreement)
shall have been extended upon terms reasonably satisfactory to AVS.

     14.9  Payment of Rent Obligations.  Kellstrom shall be current on all rent
           ---------------------------
and other obligations due and owing under the Equipment Lease and the Miramar
Lease (as modified by Sections 6.1 and 6.2 hereof) through the month in which
                      --------------------
the Closing occurs.

     14.10  Approval of the Bankruptcy Court.  The Bankruptcy Court shall have
            --------------------------------
issued a final (unless otherwise agreed) order approving this Agreement, the
Resolution Transaction Documents and the transactions contemplated hereby and
thereby.

     14.11  Consent of KAV Lender.  KAV Inventory, LLC shall have received a
            ---------------------
consent from its lenders regarding the Amendment to Non-Competition Agreement
and the provisions of Section 3.2 hereof.
                      -----------


                                  ARTICLE XV

                                  TERMINATION

     15.1  Termination. This Agreement may be terminated at any time prior to
           -----------
the Resolution Closing Date: (a) by mutual written consent of the parties hereto
at any time prior to the Resolution Closing Date; or (b) by Kellstrom in the
event of a material breach by AVS or the Company of any provision of this
Agreement which material breach is not cured within five (5) days of the
delivery to AVS or the Company of written notice thereof from Kellstrom pursuant
to the terms of Section 16.1 hereof or which breach by its nature cannot be
                ------------
cured prior to Resolution Closing Date; or (c) by AVS or the Company in the
event of a material breach by Kellstrom of any provision of this Agreement which
material breach is not cured within five (5) days of the delivery to Kellstrom
of written notice thereof from AVS or the Company pursuant to the terms of
Section 16.1 hereof or which breach by its nature cannot be cured prior to the
------------
Resolution Closing Date; or (d) by Kellstrom in the event that the Bankruptcy
Court shall have denied the sale motion with respect to the sale of Kellstrom's
assets to the Successor Party; or (e) by any of Kellstrom, AVS or the Company
immediately upon delivery of written notice to the other parties if the Closing
shall not have occurred by August 31, 2002.

                                       18
<PAGE>

     15.2  Effect of Termination.  In the event of termination of this Agreement
           ---------------------
pursuant to Section 15.1, this Agreement shall forthwith become void and of no
           -------------
further force and effect and the parties shall be released from any and all
obligations hereunder, except with respect to the provisions of Section 6.1,
                                                                -----------
Section 12.8, Section 12.11, Article XV and Article XVI; provided, however, that
------------  -------------  ----------     -----------  --------  -------
nothing herein shall relieve any party from liability for the willful breach of
any of its representations, warranties, covenants or agreements set forth in
this Agreement.  In addition, in the event that this Agreement is terminated
pursuant to Section 15.1(b), the Interim Rental Period shall be deemed to be
            ---------------
extended through August 31, 2002.

                                  ARTICLE XVI

                              GENERAL PROVISIONS

     16.1  Notices.  All notices, requests, demands, claims, and other
           -------
communications hereunder shall be in writing and shall be delivered by certified
or registered mail (first class postage pre-paid), guaranteed overnight
delivery, or facsimile transmission if such transmission is confirmed by
delivery by certified or registered mail (first class postage pre-paid) or
guaranteed overnight delivery, to the following addresses and telecopy numbers
(or to such other addresses or telecopy numbers which such party shall designate
in writing to the other party):

           (a) if to Kellstrom to:

               Kellstrom Industries, Inc.
               3701 Flamingo Road
               Miramar, FL  33027
               Attn:  Zivi R. Nedivi, President
               Telecopy:  (954) 538-7669

               with a copy to:

               Akerman, Senterfitt & Eidson, P.A.
               350 East Las Olas Boulevard, Suite 1600
               Fort Lauderdale, Florida 33301
               Attn:  Bruce I. March, Esq.
               Telecopy:  (954) 463-2224

                                       19
<PAGE>

           (b) if to the Company and/or AVS to:

               Aviation Sales Company
               623 Radar Road
               Greensboro, North Carolina 27410
               Attn:  Roy T. Rimmer, Jr., Chairman and Chief Executive Officer
               Telecopy:  (336) 664-0339

               with a copy to:

               Boyar & Miller
               4265 San Felipe, Suite 1200
               Houston, Texas 77027
               Attn: J. William Boyar, Esq.
               Telecopy:  (713) 552-1758

Notice shall be deemed given on the date sent if sent by facsimile transmission
and on the date delivered (or the date of refusal of delivery) if sent by
overnight delivery or certified or registered mail.

     16.2  Entire Agreement.  This Agreement and the Resolution Transaction
           ----------------
Documents (including the exhibits and schedules attached hereto and thereto) and
the other documents delivered pursuant hereto and thereto and in connection
herewith and therewith contains the entire understanding of the parties in
respect of its subject matter and supersedes all prior agreements and
understandings (oral or written) between or among the parties with respect to
such subject matter.  The exhibits and schedules constitute a part of the
document to which they are attached as though set forth in full thereon.

     16.3  Expenses.  AVS shall pay the fees and expenses incurred by it and the
           --------
Company, including accounting and counsel fees, in connection with this
Agreement and the Resolution Transaction Documents and the transactions
contemplated hereby and thereby, and Kellstrom shall pay its own fees and
expenses, including accounting and counsel fees, incurred in connection with
this Agreement and the Resolution Transaction Documents and the transactions
contemplated hereby and thereby.

     16.4  Amendment; Waiver.  This Agreement may not be modified, amended,
           -----------------
supplemented, canceled or discharged, except by written instrument executed by
all parties.  No failure to exercise, and no delay in exercising, any right,
power or privilege under this Agreement shall operate as a waiver, nor shall any
single or partial exercise of any right, power or privilege hereunder preclude
the exercise of any other right, power or privilege.  No waiver of any breach of
any provision shall be deemed to be a waiver of any preceding or succeeding
breach of the same or any other provision, nor shall any waiver be implied from
any course of dealing between the parties.  No extension of time for performance
of any obligations or other acts hereunder or under any other agreement shall be
deemed to be an extension of the time for performance of any other obligations
or any other acts.  Except as otherwise provided herein, the rights and remedies
of the parties under this Agreement and the Resolution Transaction

                                       20
<PAGE>

Documents are in addition to all other rights and remedies, at law or equity,
which they may have against each other.

     16.5  Binding Effect; Assignment.  The rights and obligations of this
           --------------------------
Agreement shall bind and inure to the benefit of the parties and their
respective heirs, executors, personal representatives, trustees, guardians,
attorneys-in-fact, successors and assigns. Nothing expressed or implied herein
shall be construed to give any other person any legal or equitable rights
hereunder.  Except as expressly provided herein, no party may assign any of its
rights or delegate any of its obligations under this Agreement without the prior
written consent of the non-assigning or non-delegating parties; provided,
                                                                --------
however, that notwithstanding anything to the contrary contained in this
-------
Agreement, (1) Kellstrom may assign any or all of its rights and privileges
under this Agreement to its lenders from time to time, without the consent of
the Company or AVS, provided that any such assignees shall take such assignment
subject to all of the terms, conditions and limitations set forth in the
Agreement, and (2) Kellstrom may assign its rights and delegate its obligations
under this Agreement to any direct or indirect wholly-owned subsidiary of
Kellstrom, and upon such assignment, such subsidiary shall have full rights and
obligations under this Agreement as if it were a party hereto.  Such subsidiary
shall be a third-party beneficiary with respect to all rights and remedies
provided hereunder or otherwise provided at law or in equity.  In the case of
any assignment by Kellstrom, Kellstrom shall remain fully responsible and liable
for all of its obligations hereunder.

     16.6  Counterparts.  This Agreement may be executed in any number of
           ------------
counterparts, each of which shall be an original but all of which taken together
shall constitute one and the same instrument.

     16.7  Interpretation.  Any reference made in this Agreement to an article,
           --------------
section, paragraph, clause, schedule or exhibit shall be deemed to be to the
referenced article, section, paragraph, clause, schedule or exhibit of this
Agreement unless otherwise indicated.  The headings contained in this Agreement
and on the exhibits and schedules hereto are for reference purposes only and
shall in no way affect in any way the meaning or interpretation of this
Agreement or the exhibits or schedules hereto.  Time shall be of the essence in
this Agreement.

     16.8  No Severability.  Each phrase, sentence, clause, section, subsection
           ---------------
or provision of this Agreement is dependent on the other and if any such phrase,
sentence, clause, subsection, or provision as applied to any party or to any
circumstance is adjudged by a court to be invalid or unenforceable, then this
entire Agreement, and any and all documents executed or delivered
contemporaneously with the Closing, shall be deemed null and void, and invalid
and unenforceable.

     16.9  Governing Law; Jurisdiction.  This Agreement shall be construed in
           ---------------------------
accordance with and governed for all purposes by the laws of the State of
Florida applicable to contracts executed and to be wholly performed within such
State.  Any suit, action or proceeding against Kellstrom, the Company or AVS
arising out of, or with respect to, this Agreement or any judgment entered by
any court in respect thereof shall be brought in the courts of Broward County,
Florida or in the U.S. District Court for the Southern District of Florida and
each party hereby irrevocably (a) accepts and consents to the exclusive personal
jurisdiction of such courts

                                       21
<PAGE>

for the purpose of any suit, action or proceeding, (b) waives, to the fullest
extent permitted by law, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement or any judgment entered by any court in respect thereof brought
in such courts, (c) waives any claim that any suit, action or proceedings
brought in such courts has been brought in an inconvenient forum, and (d) agrees
that service of process, summons, notice or document by U.S. registered mail in
accordance with this Agreement shall be effective service of process for any
action, suit or proceeding brought against a party in any such court.

     16.10  Arm's Length Negotiations.  Each party hereto expressly agrees that
            -------------------------
(a) before executing this Agreement, it has fully informed itself of the terms,
contents, conditions and effects of this Agreement; (b) it has relied solely and
completely upon its own judgment in executing this Agreement; (c) it has had the
opportunity to seek and has obtained the advice of counsel before executing this
Agreement; (d) it has acted voluntarily and of its own free will in executing
this Agreement; (e) it is not acting under duress, whether economic or physical,
in executing this Agreement; and (f) this Agreement is the result of arm's
length negotiations conducted by and among the parties and their respective
counsel.

                     [THIS SPACE INTENTIONALLY LEFT BLANK]

                                       22
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.

                              KELLSTROM INDUSTRIES, INC., a Delaware corporation

                              By: /s/ Zivi R. Nedivi
                                 -----------------------------------------------
                                 Zivi R. Nedivi
                                 President and Chief Executive Officer


                              AVIATION SALES COMPANY, a Delaware corporation

                              By: /s/ Roy T. Rimmer, Jr.
                                 -----------------------------------------------
                                 Roy T. Rimmer, Jr.
                                 Chairman and Chief Executive Officer


                              AVIATION SALES DISTRIBUTION SERVICES COMPANY, a
                              Delaware corporation

                              By: /s/ Roy T. Rimmer, Jr.
                                 -----------------------------------------------
                                 Roy T. Rimmer, Jr.
                                 Chairman and Chief Executive Officer

FOR PURPOSES OF ACKNOWLEDGING
AND AGREEING TO THE PROVISIONS
OF SECTION 3.2 ONLY:
   -----------

KAV INVENTORY, LLC, a Delaware limited
liability company

By: /s/ Zivi R. Nedivi
   ---------------------------------------
     Zivi R. Nedivi, Manager

By: /s/ Oscar Torres
   ---------------------------------------
     Oscar Torres, Manager

By: /s/ Roy T. Rimmer, Jr.
   ---------------------------------------
     Roy T. Rimmer, Jr., Manager

By: /s/ Gil West
   ---------------------------------------
     Gil West, Manager

                                       23

</TEXT>
</DOCUMENT>
