Aviation Sales Company to Enter Into TIM-TAM Transaction With Kitty Hawk, Inc.

MIAMI--(BUSINESS WIRE)--July 6, 1999--

Aviation Sales Company (NYSE:AVS) today announced that it has executed a definitive agreement with Kitty Hawk, Inc. (Nasdaq:KTTY) to acquire the assets of Kitty Hawk's airframe and JT8D engine maintenance operations located in Oscoda, Michigan. Under the terms of the acquisition agreement, Aviation Sales Company will pay approximately $21.5 million in cash and other consideration. Consummation of the acquisition is subject to certain conditions, including the receipt of governmental approvals. The acquisition is expected to close in August of 1999.

As part of the transaction, Aviation Sales Company and Kitty Hawk have entered into 3 year exclusive agreements for Aviation Sales Company to provide heavy airframe and engine maintenance services to Kitty Hawk on all of its 34 Boeing 727 airplanes and 112 JT8D engines. Kitty Hawk, with 1998 revenues of approximately $715 million, based in Dallas, Texas, provides global air freight carrier service, scheduled overnight air cargo service to more than 40 U.S. cities through its hub in Ft. Wayne, Indiana and air charter logistics management.

Dale S. Baker, the Company's Chairman and Chief Executive Officer stated: "We are extremely pleased to enter into this strategic business partnership with Kitty Hawk and welcome a new group of talented and dedicated employees to our Company. The transaction is particularly significant because it will allow Aviation Sales to deliver to Kitty Hawk a comprehensive nose-to-tail maintenance solution incorporating our TIM (Total Inventory Management) and TAM (Total Aircraft Maintenance) services. Additionally, Aviation Sales will benefit from the incremental 200,000 square feet of facility space and the in-house capability to perform JT8D engine overhaul and repair. In the last few weeks Aviation Sales has committed to the future purchase of over 250 JT8D aircraft engines which Aviation Sales will receive over the next three years. This engine shop will be used to support Kitty Hawk's fleet and will provide engine repair and disassembly services to our Distribution Services Group."

Aviation Sales Company is a leading independent provider of fully integrated aviation maintenance and inventory services, including aircraft heavy maintenance, component repair and overhaul, leasing, the distribution of aircraft spare parts and the manufacture of new components for major commercial airlines, original equipment manufacturers and maintenance and repair facilities.

Except for historical information contained herein, this release contains certain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from forecasted results. A number of factors, including those identified below, could adversely affect the Company's ability to obtain these results: the Company's ability to acquire adequate (more) inventory and to obtain favorable pricing for such inventory, competitive pricing for the Company's products and services, increased competition in the aircraft spare parts redistribution and MRO markets, the ability to consummate suitable acquisitions, the continuing ability to effectively integrate acquisitions, economic factors which affect the airline industry, and changes in government regulations. Certain of these risks are described in the Company's 10-K filings with the Securities and Exchange Commission (SEC). Copies of the Company's 10-K and 10-Q are available from the SEC or may be obtained upon request from the Company. The Company does not undertake any obligation to update the information contained herein, which speaks only as of this date.