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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-K

    [X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
          THE SECURITIES EXCHANGE ACT OF 1934

          For the fiscal year ended October 31, 2008 or

    [ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
          THE SECURITIES EXCHANGE ACT OF 1934

          For the transition period from____________________to__________________

                          Commission file number 1-4604

                                HEICO CORPORATION
             (Exact name of registrant as specified in its charter)

                    Florida                              65-0341002
        (State or other jurisdiction of     (I.R.S. Employer Identification No.)
       incorporation or organization)
3000 Taft Street, Hollywood, Florida                      33021
   (Address of principal executive offices)             (Zip Code)

                                 (954) 987-4000
              (Registrant's telephone number, including area code)

           Securities registered pursuant to Section 12(b) of the Act:

    Common Stock, $.01 par value per share            New York Stock Exchange
Class A Common Stock, $.01 par value per share   (Name of each exchange on which
            (Title of each class)                           registered)

           Securities registered pursuant to Section 12(g) of the Act:

        Rights to Purchase Series B Junior Participating Preferred Stock
        Rights to Purchase Series C Junior Participating Preferred Stock
                                (Title of class)

     Indicate by check mark if the registrant is a well-known seasoned issuer,
as defined in Rule 405 of the Securities Act.  Yes [X]  No [ ]

     Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act.  Yes [ ]  No [X]

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]  No [ ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer, or a smaller reporting company.
See the definitions of "large accelerated filer," "accelerated filer" and
"smaller reporting company" in Rule 12b-2 of the Exchange Act.  (Check one)

           Large accelerated filer [X]   Accelerated filer [ ]

           Non-accelerated filer [ ]     Smaller reporting company [ ]

                  (Do not check if a smaller reporting company)

     Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act).  Yes [ ]  No [X]

     The aggregate market value of the voting and non-voting common equity held
by nonaffiliates of the registrant was $1,090,456,000 based on the closing price
of HEICO Common Stock and Class A Common Stock as of April 30, 2008 as reported
by the New York Stock Exchange.

     The number of shares outstanding of each of the registrant's classes of
common stock as of December 19, 2008:

             Common Stock, $.01 par value            10,572,641 shares

             Class A Common Stock, $.01 par value    15,843,100 shares

                       DOCUMENTS INCORPORATED BY REFERENCE

     Portions of the registrant's definitive proxy statement for the 2009 Annual
Meeting of Shareholders are incorporated by reference into Part III of this
Annual Report on Form 10-K.

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<PAGE>

                                HEICO CORPORATION
                      INDEX TO ANNUAL REPORT ON FORM 10-K

<TABLE>
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<S>                                                                                              <C>
PART I
  Item 1.   Business ........................................................................     1
  Item 1A.  Risk Factors ....................................................................    11
  Item 1B.  Unresolved Staff Comments .......................................................    15
  Item 2.   Properties ......................................................................    16
  Item 3.   Legal Proceedings ...............................................................    16
  Item 4.   Submission of Matters to a Vote of Security Holders .............................    16

PART II
  Item 5.   Market for Registrant's Common Equity, Related Stockholder Matters and Issuer
               Purchases of Equity Securities ...............................................    17
  Item 6.   Selected Financial Data .........................................................    21
  Item 7.   Management's Discussion and Analysis of Financial Condition and Results of
               Operations ...................................................................    22
  Item 7A.  Quantitative and Qualitative Disclosures About Market Risk ......................    39
  Item 8.   Financial Statements and Supplementary Data .....................................    40
  Item 9.   Changes in and Disagreements With Accountants on Accounting and Financial
               Disclosure ...................................................................    76
  Item 9A.  Controls and Procedures .........................................................    76
  Item 9B.  Other Information ...............................................................    77

PART III
  Item 10.  Directors, Executive Officers and Corporate Governance ..........................    78
  Item 11.  Executive Compensation ..........................................................    78
  Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related
               Stockholder Matters ..........................................................    78
  Item 13.  Certain Relationships and Related Transactions, and Director Independence .......    78
  Item 14.  Principal Accountant Fees and Services ..........................................    78

PART IV
  Item 15.  Exhibits and Financial Statement Schedules ......................................    79

SIGNATURES ..................................................................................    83
</TABLE>
<PAGE>

                                     PART I

Item 1.    BUSINESS

The Company

         HEICO Corporation through its subsidiaries (collectively, "HEICO,"
"we," "us," "our" or the "Company") believes it is the world's largest
manufacturer of Federal Aviation Administration ("FAA")-approved jet engine
and aircraft component replacement parts, other than the original equipment
manufacturers ("OEMs") and their subcontractors. HEICO also believes it is a
leading manufacturer of various types of electronic equipment for the aviation,
defense, space, medical, telecommunications and electronics industries.

         The Company was organized in 1993 creating a new holding corporation
known as HEICO Corporation and renaming the former holding company (formerly
known as HEICO Corporation, organized in 1957) as HEICO Aerospace Corporation.
There organization, which was completed in 1993, did not result in any change
in the business of the Company, its consolidated assets or liabilities or the
relative interests of its shareholders.

         Our business is comprised of two operating segments:

         The Flight Support Group. Our Flight Support Group, consisting of HEICO
Aerospace Holdings Corp. ("HEICO Aerospace") and its subsidiaries, accounted for
75%, 76% and 71% of our net sales in fiscal 2008, 2007 and 2006, respectively.
The Flight Support Group uses proprietary technology to design and manufacture
jet engine and aircraft component replacement parts for sale at lower prices
than those manufactured by OEMs. These parts are approved by the FAA and are the
functional equivalent of parts sold by OEMs. In addition, the Flight Support
Group repairs and distributes jet engine and aircraft components, avionics and
instruments for domestic and foreign commercial air carriers and aircraft repair
companies as well as military and business aircraft operators; and manufactures
thermal insulation products and other component parts primarily for aerospace,
defense and commercial applications.

         The Flight Support Group competes with the leading industry OEMs and,
to a lesser extent, with a number of smaller, independent parts distributors.
Historically, the three principal jet engine OEMs, General Electric (including
CFM International), Pratt & Whitney and Rolls Royce, have been the sole source
of substantially all jet engine replacement parts for their jet engines. Other
OEMs have been the sole source of replacement parts for their aircraft component
parts. While we believe that we currently supply less than 2% of the market for
jet engine and aircraft component replacement parts, we have consistently been
adding new products to our line and currently hold Parts Manufacturer
Approvals, which we refer to as "PMAs," for over 7,000 jet engine and aircraft
component replacement parts.

         We believe that, based on our competitive pricing, reputation for high
quality, short lead time requirements, strong relationships with domestic and
foreign commercial air carriers and repair stations (companies that overhaul
aircraft engines and/or components), strategic relationships with Lufthansa and
other major airlines and successful track record of receiving PMAs from the FAA,
we are uniquely positioned to continue to increase our product lines and gain
market share.

         The Electronic Technologies Group. Our Electronic Technologies Group,
consisting of HEICO Electronic Technologies Corp. and its subsidiaries,
accounted for 25%, 24% and 29% of our net sales in fiscal 2008, 2007 and 2006,
respectively. Through our Electronic Technologies Group, which derived
approximately 41% of its sales in fiscal 2008 from the sale of products and
services to U.S. and foreign

                                        1
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military agencies, we design, manufacture and sell various types of electronic,
microwave and electro-optical products, including infrared simulation and test
equipment, laser rangefinder receivers, electrical power supplies, back-up power
supplies, electromagnetic interference and radio frequency interference
shielding, high power capacitor charging power supplies, amplifiers,
photodetectors, amplifier modules, flash lamp drivers, laser diode drivers, arc
lamp power supplies, custom power supply designs, cable assemblies, high
voltage interconnection devices and wire, high voltage energy generators, high
frequency power delivery systems and high-speed interface products that link
devices such as telemetry receivers, digital cameras, high resolution scanners,
simulation systems and test systems to almost any computer.

         In October 1997, we entered into a strategic alliance with Lufthansa.
Lufthansa is the world's largest independent provider of engineering and
maintenance services for aircraft components and jet engines and supports over
200 airlines, governments and other customers. As part of this strategic
alliance, Lufthansa has invested over $60 million in our Company to acquire and
maintain a 20% minority interest in HEICO Aerospace. This strategic alliance
has enabled us to expand domestically and internationally by enhancing our
ability to (i) identify key jet engine and aircraft component replacement parts
with significant profit potential by utilizing Lufthansa's extensive operating
data on engine and component parts; (ii) introduce those parts throughout the
world in an efficient manner due to Lufthansa's testing and diagnostic
resources; and (iii) broaden our customer base by capitalizing on Lufthansa's
established relationships and alliances within the airline industry.

         In March 2001, we entered into a joint venture with American Airlines,
one of the world's largest airlines, to develop, design and sell FAA-approved
jet engine and aircraft component replacement parts through HEICO Aerospace. The
joint venture is partly owned by American Airlines. American Airlines and HEICO
Aerospace have agreed to cooperate regarding technical services and marketing
support on a worldwide basis. We have also entered into several strategic
relationships with other leading airlines, such as United Airlines (May 2002),
Delta Air Lines (February 2003), Japan Airlines (March 2004) and British Airways
(May 2007). These relationships accelerate HEICO's efforts in developing a broad
range of jet engine and aircraft component replacement parts for FAA approval.
Each of the aforementioned airlines purchase these newly developed parts, and
many of HEICO Aerospace's current FAA-approved parts product line, on an
exclusive basis from HEICO Aerospace.

         In February 2006, we entered into a Joint Cooperation Agreement with
China Aviation Import and Export Group Corporation ("CASGC") of the Peoples
Republic of China to promote HEICO Aerospace's FAA-approved aircraft and engine
replacement products in China. CASGC is a state-owned company, which is a
comprehensive service provider for aviation supplies, primarily engaged in the
import and export of aviation-related products in China including aircraft
engines, spares, ground support and safety equipment. CASGC's business scope
also covers leasing maintenance, component repair and overhaul, consignment
stores, manufacturing and training.

         HEICO has continuously operated in the aerospace industry for more than
50 years. Since assuming control in 1990, our current management has achieved
significant sales and profit growth through a broadened line of product
offerings, an expanded customer base, increased research and development
expenditures and the completion of a number of acquisitions. As a result of
internal growth and acquisitions, our net sales from continuing operations have
grown from $26.2 million in fiscal 1990 to $582.3 million in fiscal 2008, a
compound annual growth rate of approximately 19%. During the same period, we
improved our net in come from continuing operations from $2.0 million to $48.5
million, representing a compound annual growth rate of approximately 20%.

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<PAGE>

Flight Support Group

         The Flight Support Group, headquartered in Hollywood, Florida, serves a
broad spectrum of the aviation industry, including (i) commercial airlines and
air cargo carriers; (ii) repair and overhaul facilities; (iii) OEMs; and (iv)
U.S. and foreign governments.

         Jet engine and aircraft component replacement parts can be categorized
by their ongoing ability to be repaired and returned to service. The general
categories in which we participate are as follows: (i) rotable; (ii) repairable;
and (iii) expendable. A rotable is a part which is removed periodically as
dictated by an operator's maintenance procedures or on an as needed basis and
is typically repaired or overhauled and re-used an indefinite number of times.
An important subset of rotables is "life limited" parts. A life limited rotable
has a designated number of allowable flight hours and/or cycles (one take-off
and landing generally constitutes one cycle) after which it is rendered
unusable. A repairable is similar to a rotable except that it can only be
repaired a limited number of times before it must be discarded. An expendable is
generally a part which is used and not thereafter repaired for further use.

         Jet engine and aircraft component replacement parts are classified
within the industry as (i) factory-new; (ii) new surplus; (iii) overhauled; (iv)
repairable; and (v) as removed. A factory-new or new surplus part is one that
has never been installed or used. Factory-new parts are purchased from FAA-
approved manufacturers (such as HEICO or OEMs) or their authorized distributors.
New surplus parts are purchased from excess stock of airlines, repair
facilities or other redistributors. An overhauled part is one that has been
completely repaired and inspected by a licensed repair facility such as ours. An
aircraft spare part is classified as "repairable" if it can be repaired by a
licensed repair facility under applicable regulations. A part may also be
classified as "repairable" if it can be removed by the operator from an aircraft
or jet engine while operating under an approved maintenance program and is
airworthy and meets any manufacturer or time and cycle restrictions applicable
to the part. A "factory-new," "new surplus," "overhauled" or "repairable" part
designation indicates that the part can be immediately utilized on an aircraft.
A part in "as removed" condition requires inspection and possibly functional
testing, repair or overhaul by a licensed facility prior to being returned to
service in an aircraft.

         Factory-New Jet Engine and Aircraft Component Replacement Parts. The
principal business of the Flight Support Group is the research and development,
design, manufacture and sale of FAA-approved replacement parts that are sold
to domestic and foreign commercial air carriers and aircraft repair and overhaul
companies. Our principal competitors are Pratt & Whitney, a division of United
Technologies Corporation, and General Electric Company, including its CFM
International joint venture. The Flight Support Group's factory-new replacement
parts include various jet engine and aircraft component replacement parts. A key
element of our growth strategy is the continued design and development of an
increasing number of Parts Manufacturer Approval ("PMA") replacement parts in
order to further penetrate our existing customer base and obtain new customers.
We select the jet engine and aircraft component replacement parts to design and
manufacture through a selection process which analyzes industry information to
determine which replacement parts are suitable candidates. As part of
Lufthansa's investment in the Flight Support Group, Lufthansa has the right to
select 50% of the parts for which we will seek PMAs, provided that such parts
are technologically and economically feasible and substantially comparable with
the profitability of our other PMA parts.

         Repair and Overhaul Services. The Flight Support Group provides repair
and overhaul services on selected jet engine and aircraft component parts, as
well as on avionics, instruments, composites and flight surfaces of commercial
aircraft. The Flight Support Group also provides repair and overhaul services to
military aircraft operators and aircraft repair and overhaul companies. Our
repair and overhaul operations require a high level of expertise, advanced
technology and sophisticated equipment. Services include the repair,
refurbishment and overhaul of numerous accessories and parts mounted on gas
turbine

                                        3
<PAGE>

engines and airframes. Components overhauled include fuel pumps, generators,
fuel controls, pneumatic valves, starters and actuators, turbo compressors and
constant speed drives, hydraulic pumps, valves and actuators, composite flight
controls, electro-mechanical equipment and auxiliary power unit accessories.
The Flight Support Group also provides commercial airlines, regional operators,
asset management companies and Maintenance, Repair and Overhaul ("MRO")
providers with high quality and cost effective niche accessory component
exchange services as an alternative to OEMs' spares services.

         Furthermore, the Flight Support Group repairs avionics and navigation
systems as well as subcomponents and other instruments utilized in military and
commercial aircraft. Our customers include the United States government, foreign
military agencies and both domestic and foreign commercial airlines.

         Distribution. The Flight Support Group distributes FAA-approved parts
including hydraulic, pneumatic, mechanical and electro-mechanical components
for the commercial, regional and general aviation markets.

         Manufacture of Specialty Aircraft/Defense Related Parts and
Subcontracting for OEMs. The Flight Support Group manufactures thermal
insulation blankets primarily for aerospace, defense and commercial
applications. The Flight Support Group also manufactures specialty components
for sale as a subcontractor for aerospace and industrial original equipment
manufacturers and the United States government.

         FAA Approvals and Product Design. Non-OEM manufacturers of jet engine
replacement parts must receive a Parts Manufacturer Approval ("PMA") from the
FAA to sell the replacement part. The PMA approval process includes the
submission of sample parts, drawings and testing data to one of the FAA's
Aircraft Certification Offices where the submitted data are analyzed. We believe
that an applicant's ability to successfully complete the PMA process is limited
by several factors, including (i) the agency's confidence level in the
applicant; (ii) the complexity of the part; (iii) the volume of PMAs being
filed; and (iv) the resources available to the FAA. We also believe that
companies such as HEICO that have demonstrated their manufacturing capabilities
and established favorable track records with the FAA generally receive a faster
turnaround time in the processing of PMA applications. Finally, we believe that
the PMA process creates a significant barrier to entry in this market niche
through both its technical demands and its limits on the rate at which
competitors can bring products to market.

         As part of our growth strategy, we have continued to increase our
research and development activities. Research and development expenditures by
the Flight Support Group, which were approximately $300,000 in fiscal 1991,
increased to approximately $11.1 million in fiscal 2008, $10.7 million in fiscal
2007 and $10.6 million in 2006. We believe that our Flight Support Group's
research and development capabilities are a significant component of our
historical success and an integral part of our growth strategy.

         Our expanded research and development activities have included
development of more complex jet engine and aircraft component replacement parts.
We now have over 4,500 parts approved by the FAA that are actively being
marketed and have cumulative FAA approvals for over 7,000 parts. We believe the
development and subsequent sale of PMA parts represents a significant long-term
market opportunity. In fiscal 2008, the FAA granted us PMAs for approximately
450 new parts (excluding acquired PMAs); however, no assurance can be given that
the FAA will continue to grant PMAs or that we will achieve acceptable levels of
net sales and gross profits on such parts in the future.

         We benefit from our proprietary rights relating to certain design,
engineering and manufacturing processes and repair and overhaul procedures.
Customers often rely on us to provide initial and

                                        4
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additional components, as well as to redesign, re-engineer, replace or repair
and provide overhaul services on such aircraft components at every stage of
their useful lives. In addition, for some products, our unique manufacturing
capabilities are required by the customer's specifications or designs, thereby
necessitating reliance on us for production of such designed products.

         We have no material patents for the proprietary techniques, including
software and manufacturing expertise, we have developed to manufacture jet
engine and aircraft component replacement parts and instead, we primarily rely
on trade secret protection. Although our proprietary techniques and software and
manufacturing expertise are subject to misappropriation or obsolescence, we
believe that we take appropriate measures to prevent misappropriation or
obsolescence from occurring by developing new techniques and improving existing
methods and processes, which we will continue on an ongoing basis as dictated by
the technological needs of our business.

Electronic Technologies Group

         Much of our Electronic Technologies Group's strategy is centered around
producing equipment that helps the U.S. military and allied foreign military
agencies conduct stand-off operations from greater distances. Our activities in
this regard are focused on products that are placed in airborne, vehicle-based
or handheld targeting systems as well as in providing equipment used to develop,
test and calibrate such systems.

         Electro-Optical Infrared Simulation and Test Equipment. The Electronic
Technologies Group believes it is a leading international designer and
manufacturer of niche state-of-the-art simulation, testing and calibration
equipment used in the development of missile seeking technology, airborne
targeting and reconnaissance systems, shipboard targeting and reconnaissance
systems, space-based sensors as well as ground vehicle-based systems. These
products include infrared scene projector equipment, such as our MIRAGE IR Scene
Simulator, high precision blackbody sources, software and integrated calibration
systems.

         Simulation equipment allows the U.S. government and allied foreign
military to save money on missile testing as it allows infrared-based missiles
to be tested on a multi-axis, rotating table instead of requiring the launch of
a complete missile. In addition, several large military prime contractors have
elected to purchase such equipment from us instead of maintaining internal staff
to do so because we can offer a more cost-effective solution. Our customers
include major U.S. Department of Defense weapons laboratories and defense prime
contractors, such as Lockheed Martin, Northrop Grumman and Boeing.

         Electro-Optical Laser Products. The Electronic Technologies Group
believes it is a leading designer and maker of Laser Rangefinder Receivers and
other photodetectors used in airborne, vehicular and handheld targeting systems
manufactured by major prime military contractors, such as Northrop Grumman and
Lockheed Martin. Most of our Rangefinder Receiver product offering consists of
complex and patented products which detect reflected light from laser targeting
systems and allow the systems to confirm target accuracy and calculate target
distances prior to discharging a weapon system. These products are also used in
laser eye surgery systems for tracking ocular movement.

         Electro-Optical, Microwave and Other Power Equipment. The Electronic
Technologies Group produces power supplies, amplifiers and flash lamp drivers
used in laser systems for military, medical and other applications that are
sometimes utilized with our Rangefinder Receivers. We also produce emergency
back-up power supplies and batteries used on commercial aircraft and business
jets for services such as emergency exit lighting, emergency fuel shut-off,
power door assists, cockpit voice recorders and flight computers. We offer
custom or standard designs that solve challenging OEM requirements and meet
stringent agency safety and emissions requirements. Our power electronics

                                        5
<PAGE>

products include capacitor charger power supplies, laser diode drivers, arc lamp
power supplies and custom power supply designs.

         Our microwave products are used in satellites and electronic warfare
systems. These products, which include isolators, bias tees, circulators,
latching ferrite switches and waveguide adapters, are used in satellites to
control or direct energy according to operator needs. As satellites are
frequently used as sensors for stand-off warfare, we believe this product line
further supports our goal of increasing our activity in the stand-off market.
We believe we are a leading supplier of the niche products which we design and
manufacture for this market, a market that includes commercial satellites. Our
customers for these products include satellite manufacturers, such as Space
Systems/Loral, Boeing and Raytheon.

         Electromagnetic and Radio Interference Shielding. The Electronic
Technologies Group designs and manufactures shielding used to prevent
electromagnetic energy and radio frequencies from interfering with computers,
telecommunication devices, avionics, weapons systems and other electronic
equipment. Our products include a patented line of shielding applied directly to
circuit boards and a line of gasket-type shielding applied to computers and
other electronic equipment. Our customers consist essentially of medical,
electronic, telecommunication and defense equipment producers.

         High-Speed Interface Products. The Electronic Technologies Group
designs and manufactures advanced high-technology, high-speed interface products
utilized in homeland security, defense, medical research, astronomical and other
applications across numerous industries.

         High Voltage Interconnection Devices. The Electronic Technologies
Group designs and manufactures high and very high voltage interconnection
devices, cable assemblies and wire for the medical equipment, defense and other
industrial markets. Among others, our products are utilized in aircraft missile
defense, fighter pilot helmet displays, avionic systems, medical applications,
wireless communications, and industrial applications including high voltage test
equipment and underwater monitoring systems.

         High Voltage Advanced Power Electronics. The Electronic Technologies
Group designs and manufactures a patented line of high voltage energy generators
for medical, baggage inspection and industrial imaging systems, and also offers
a patented line of high frequency power delivery systems for the commercial sign
industry.

Financial Information About Operating Segments and Geographic Areas

         See Note 13, Operating Segments, of the Notes to Consolidated Financial
Statements for financial information by operating segment and by geographic
areas.

Sales, Marketing and Customers

         Each of our operating segments independently conducts sales and
marketing efforts directed at their respective customers and industries and, in
some cases, collaborates with other operating divisions and subsidiaries within
its group for cross-marketing efforts. Sales and marketing efforts are
conducted primarily by in-house personnel and, to a lesser extent, by
independent manufacturers' representatives. Generally, the in-house sales
personnel receive a base salary plus commission and manufacturers'
representatives receive a commission on sales.

         We believe that direct relationships are crucial to establishing and
maintaining a strong customer base and, accordingly, our senior management is
actively involved in our marketing activities, particularly with established
customers. We are also a member of various trade and business organizations
related to

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the commercial aviation industry, such as the Aerospace Industries Association,
which we refer to as AIA, the leading trade association representing the
nation's manufacturers of commercial, military and business aircraft, aircraft
engines and related components and equipment. Due in large part to our
established industry presence, we enjoy strong customer relations, name
recognition and repeat business.

         We sell our products to a broad customer base consisting of domestic
and foreign commercial and cargo airlines, repair and overhaul facilities, other
aftermarket suppliers of aircraft engine and airframe materials, OEMs, domestic
and foreign military units, electronic manufacturing services companies,
manufacturers for the defense industry as well as medical, telecommunication,
scientific, and industrial companies. No one customer accounted for sales of 10%
or more of total consolidated sales from continuing operations during any of the
last three fiscal years. Net sales to our five largest customers accounted for
approximately 21% of total net sales during the year ended October 31, 2008.

Competition

         The aerospace product and service industry is characterized by intense
competition and some of our competitors have substantially greater name
recognition, inventories, complementary product and service offerings,
financial, marketing and other resources than we do. As a result, such
competitors may be able to respond more quickly to customer requirements than we
can. Moreover, smaller competitors may be in a position to offer more attractive
pricing as a result of lower labor costs and other factors.

         Our jet engine and aircraft component replacement parts business
competes primarily with Pratt & Whitney and General Electric. The competition is
principally based on price and service inasmuch as our parts are
interchangeable. With respect to other aerospace products and services sold by
the Flight Support Group, we compete with both the leading jet engine OEMs and a
large number of machining, fabrication and repair companies, some of which have
greater financial and other resources than we do. Competition is based mainly on
price, product performance, service and technical capability.

         Competition for the repair and overhaul of jet engine and aircraft
components comes from three principal sources: OEMs, major commercial airlines
and other independent service companies. Some of these competitors have greater
financial and other resources than we do. Some major commercial airlines own
and operate their own service centers and sell repair and overhaul services to
other aircraft operators. Foreign airlines that provide repair and overhaul
services typically provide these services for their own aircraft components and
for third parties. OEMs also maintain service centers that provide repair and
overhaul services for the components they manufacture. Other independent service
organizations also compete for the repair and overhaul business of other users
of aircraft components. We believe that the principal competitive factors in the
repair and overhaul market are quality, turnaround time, overall customer
service and price.

         Our Electronic Technologies Group competes with several large and
small domestic and foreign competitors, some of which have greater financial and
other resources than we do. The market for our electronic products are niche
markets with several competitors with competition based mainly on design,
technology, quality, price and customer satisfaction.

Raw Materials

         We purchase a variety of raw materials, primarily consisting of high
temperature alloy sheet metal and castings, forgings, pre-plated metals and
electrical components from various vendors. The materials used by our
operations are generally available from a number of sources and in sufficient
quantities to meet current requirements subject to normal lead times.

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Backlog

         Our total backlog of unshipped orders was $107.1 million as of October
31, 2008 compared to $106.3 million as of October 31, 2007. The Flight Support
Group's backlog of unshipped orders was $49.0 million as of October 31, 2008 as
compared to $43.6 million as of October 31, 2007. This backlog excludes
forecasted shipments for certain contracts of the Flight Support Group pursuant
to which customers provide only estimated annual usage and not firm purchase
orders. Our backlogs within the Flight Support Group are typically short-lead
in nature with many product orders being received within the month of shipment.
The Electronic Technologies Group's backlog of unshipped orders was $58.1
million as of October 31, 2008 as compared to $62.7 million as of October 31,
2007. The decrease in the Electronic Technologies Group's backlog is primarily
related to the timing of several large-order placements and shipments.
Substantially the entire backlog of orders as of October 31, 2008 is expected to
be delivered during fiscal 2009.

Government Regulation

         The FAA regulates the manufacture, repair and operation of all
aircraft and aircraft parts operated in the United States. Its regulations are
designed to ensure that all aircraft and aviation equipment are continuously
maintained in proper condition to ensure safe operation of the aircraft.
Similar rules apply in other countries. All aircraft must be maintained under a
continuous condition monitoring program and must periodically undergo thorough
inspection and maintenance. The inspection, maintenance and repair procedures
for the various types of aircraft and equipment are prescribed by regulatory
authorities and can be performed only by certified repair facilities utilizing
certified technicians. Certification and conformance is required prior to
installation of a part on an aircraft. Aircraft operators must maintain logs
concerning the utilization and condition of aircraft engines, life-limited
engine parts and airframes. In addition, the FAA requires that various
maintenance routines be performed on aircraft engines, some engine parts, and
airframes at regular intervals based on cycles or flight time. Engine
maintenance must also be performed upon the occurrence of certain events, such
as foreign object damage in an aircraft engine or the replacement of
life-limited engine parts. Such maintenance usually requires that an aircraft
engine be taken out of service. Our operations may in the future be subject to
new and more stringent regulatory requirements. In that regard, we closely
monitor the FAA and industry trade groups in an attempt to understand how
possible future regulations might impact us.

         There has been no material adverse effect to our consolidated financial
statements as a result of these government regulations.

Environmental Regulation

         Our operations are subject to extensive, and frequently changing,
federal, state and local environmental laws and substantial related regulation
by government agencies, including the Environmental Protection Agency. Among
other matters, these regulatory authorities impose requirements that regulate
the operation, handling, transportation and disposal of hazardous materials;
protect the health and safety of workers; and require us to obtain and maintain
licenses and permits in connection with our operations. This extensive
regulatory framework imposes significant compliance burdens and risks on us.
Notwithstanding these burdens, we believe that we are in material compliance
with all federal, state and local laws and regulations governing our operations.

Other Regulation

        We are also subject to a variety of other regulations including work-
related and community safety laws. The Occupational Safety and Health Act of
1970 mandates general requirements for safe

                                        8
<PAGE>

workplaces for all employees and established the Occupational Safety and Health
Administration ("OSHA") in the Department of Labor. In particular, OSHA provides
special procedures and measures for the handling of some hazardous and toxic
substances. In addition, specific safety standards have been promulgated for
workplaces engaged in the treatment, disposal or storage of hazardous waste.
Requirements under state law, in some circumstances, may mandate additional
measures for facilities handling materials specified as extremely dangerous. We
believe that our operations are in material compliance with OSHA's health and
safety requirements.

Insurance

         We are a named insured under policies which include the following
coverage: (i) product liability, including grounding; (ii) personal property,
inventory and business income at our facilities; (iii) general liability
coverage; (iv) employee benefit liability; (v) international liability and
automobile liability; (vi) umbrella liability coverage; and (vii) various other
activities or items subject to certain limits and deductibles. We believe that
our insurance coverage is adequate to insure against the various liability risks
of our business.

Employees

         As of October 31, 2008, we had 2,328 full-time and part-time employees,
of whom 1,613 were in the Flight Support Group, 690 were in the Electronic
Technologies Group, and 25 were in corporate. None of our employees are
represented by a union. We believe that we have good relations with our
employees.

Available Information

         Our Internet web site address is http://www.heico.com. We make
available free of charge through our web site our annual reports on Form 10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to
those reports filed or furnished pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 as soon as reasonably practicable after we
electronically file such material with, or furnish it to, the Securities and
Exchange Commission ("SEC"). These materials are also available free of charge
on the SEC's website at http://www.sec.gov. The information on or obtainable
through our web site is not incorporated into this annual report on Form 10-K.

         We have adopted a code of ethics that applies to our principal
executive officer, principal financial officer, principal accounting officer or
controller and other persons performing similar functions. The code of ethics is
located on our web site at http://www.heico.com. Any amendments to or waivers
from a provision of this code of ethics will be posted on the web site. Also
located on the web site are our Corporate Governance Guidelines, Finance/Audit
Committee Charter, Nominating & Corporate Governance Committee Charter and
Compensation Committee Charter.

         Copies of the above referenced materials will be made available, free
of charge, upon written request to the Corporate Secretary at the Company's
headquarters.

                                        9
<PAGE>

Executive Officers of the Registrant

        Our executive officers are elected by the Board of Directors at the
first meeting following the annual meeting of shareholders and serve at the
discretion of the Board. The following table sets forth the names, ages of, and
positions and offices held by our executive officers as of December 19, 2008:

<TABLE>
<CAPTION>
                                                                                              Director
Name                          Age      Position(s)                                             Since
----                          ---      -----------                                             -----
<S>                            <C>     <C>                                                      <C>
Laurans A. Mendelson           70      Chairman of the Board, President and Chief               1989
                                       Executive Officer

Thomas S. Irwin                62      Executive Vice President and Chief Financial              _
                                       Officer

Eric A. Mendelson              43      Executive Vice President and Director;                   1992
                                       President and Chief Executive Officer of
                                       HEICO Aerospace Holdings Corp.

Victor H. Mendelson            41      Executive Vice President and Director;                   1996
                                       President and Chief Executive Officer of
                                       HEICO Electronic Technologies Corp.

William S. Harlow              60      Vice President of Corporate Development                    _
</TABLE>

         Laurans A. Mendelson has served as Chairman of the Board of the Company
since December 1990. He has also served as Chief Executive Officer of the
Company since February 1990 and President of the Company since September 1991.
HEICO Corporation is a member of the Aerospace Industries Association ("AIA") in
Washington D.C., and Mr. Mendelson serves on the Board of Governors of AIA. He
is also former Chairman of the Board of Trustees, former Chairman of the
Executive Committee and a current member of the Society of Mt. Sinai Founders of
Mt. Sinai Medical Center in Miami Beach, Florida. In addition, Mr. Mendelson
served as a Trustee of Columbia University in The City of New York from 1995 to
2001, as well as Chairman of the Trustees' Audit Committee. Mr. Mendelson
currently serves as Trustee Emeritus of Columbia University. Mr. Mendelson is a
Certified Public Accountant. Laurans Mendelson is the father of Eric Mendelson
and Victor Mendelson.

         Thomas S. Irwin has served as Executive Vice President and Chief
Financial Officer of the Company since September 1991; Senior Vice President of
the Company from 1986 to 1991; and Vice President and Treasurer from 1982 to
1986. Mr. Irwin is a Certified Public Accountant. He is a Trustee of the
Greater Hollywood Chamber of Commerce and a Director of the Broward Alliance.

         Eric A. Mendelson has served as Executive Vice President of the Company
since 2001; President and Chief Executive Officer of HEICO Aerospace Holdings
Corp., a subsidiary of the Company, since its formation in 1997; and President
of HEICO Aerospace Corporation since 1993. He also served as Vice President of
the Company from 1992 to 2001; President of HEICO's Jet Avion Corporation, a
wholly owned subsidiary of HEICO Aerospace, from 1993 to 1996; and Jet Avion's
Executive Vice President and Chief Operating Officer from 1991 to 1993. From
1990 to 1991, Mr. Mendelson was Director of Planning and Operations of the
Company. Mr. Mendelson is a co-founder, and, since 1987, has been Managing
Director of Mendelson International Corporation, a private investment company,
which is a shareholder of HEICO. Eric Mendelson is the son of Laurans Mendelson
and the brother of Victor Mendelson. In addition, Mr. Mendelson is a member of
the Board of Trustees of Mt. Sinai Medical Center in Miami Beach, Florida and
Ransom-Everglades School in Coconut Grove, Florida, as well as a member of the
Executive Committee of the Columbia College Alumni Association.

                                       10
<PAGE>

         Victor H. Mendelson has served as Executive Vice President of the
Company since 2001 and President and Chief Executive Officer of HEICO Electronic
Technologies Corp., a subsidiary of the Company, since September 1996. He served
as General Counsel of the Company from 1993 to September 2008 and Vice President
of the Company from 1996 to 2001. In addition, Mr. Mendelson was the Executive
Vice President of the Company's former MediTek Health Corporation subsidiary
from 1994 and MediTek Health's Chief Operating Officer from 1995 until its sale
in July 1996. He was the Company's Associate General Counsel from 1992 until
1993. From 1990 until 1992, he worked on a consulting basis with the Company,
developing and analyzing various strategic opportunities. Mr. Mendelson is a
co-founder, and, since 1987, has been President of Mendelson International
Corporation, a private investment company, which is a shareholder of HEICO. He
is a member of the Board of Visitors of Columbia College in New York City, a
Trustee of St. Thomas University in Miami Gardens, Florida and a Director of
the Florida Grand Opera. Victor Mendelson is the son of Laurans Mendelson and
the brother of Eric Mendelson.

         William S. Harlow has served as Vice President of Corporate Development
since 2001 and served as Director of Corporate Development from 1995 to 2001.

Item 1A. RISK FACTORS

         Our business, financial condition, operating results and cash flows can
be impacted by a number of factors, many of which are beyond our control,
including but not limited to those set forth below and elsewhere in this Annual
Report on Form 10-K, any one of which may cause our actual results to differ
materially from anticipated results:

Our success is highly dependent on the performance of the aviation industry,
which could be impacted by lower demand for commercial air travel or airline
fleet changes causing lower demand for our goods and services.

         Economic factors and passenger security concerns that affect the
aviation industry also affect our business. The aviation industry has
historically been subject to downward cycles from time to time which reduce the
overall demand for jet engine and aircraft component replacement parts and
repair and overhaul services, and such downward cycles result in lower prices
and greater credit risk. These economic factors and passenger security concerns
may have a material adverse effect on our business, financial condition and
results of operations.

We are subject to governmental regulation and our failure to comply with these
regulations could cause the government to withdraw or revoke our authorizations
and approvals to do business and could subject us to penalties and sanctions
that could harm our business.

         Governmental agencies throughout the world, including the FAA, highly
regulate the manufacture, repair and overhaul of aircraft parts and accessories.
We include, with the replacement parts that we sell to our customers,
documentation certifying that each part complies with applicable regulatory
requirements and meets applicable standards of airworthiness established by the
FAA or the equivalent regulatory agencies in other countries. In addition, our
repair and overhaul operations are subject to certification pursuant to
regulations established by the FAA. Specific regulations vary from country to
country, although compliance with FAA requirements generally satisfies
regulatory requirements in other countries. The revocation or suspension of any
of our material authorizations or approvals would have an adverse effect on our
business, financial condition and results of operations. New and more stringent
government regulations, if adopted and enacted, could have an adverse effect on
our business, financial condition and results of operations. In addition, some
sales to foreign countries of the equipment

                                       11
<PAGE>

manufactured by our Electronic Technologies Group require approval or licensing
from the U.S. government. Denial of export licenses could reduce our sales to
those countries and could have a material adverse effect on our business.

The retirement of commercial aircraft could reduce our revenues.

         Our Flight Support Group designs, engineers, manufactures and
distributes jet engine and aircraft component replacement parts and also
repairs, refurbishes and overhauls jet engine and aircraft components. If
aircraft or engines for which we have replacement parts or supply repair and
overhaul services are retired and there are fewer aircraft that require these
parts or services, our revenues may decline.

Reductions in defense, space or homeland security spending by U.S. and/or
foreign customers could reduce our revenues.

         In fiscal 2008, approximately 41% of the sales of our Electronic
Technologies Group were derived from the sale of products and services to U.S.
and foreign military agencies and their suppliers. A decline in defense, space
or homeland security budgets or additional restrictions imposed by the U.S.
government on sales of products or services to foreign military agencies could
lower sales of our products and services.

Intense competition from existing and new competitors may harm our business.

         We face significant competition in each of our businesses.

    Flight Support Group

         o  For jet engine replacement parts, we compete with the industry's
            leading jet engine OEMs, particularly Pratt & Whitney and General
            Electric.

         o  For the overhaul and repair of jet engine and airframe components
            as well as avionics and navigation systems, we compete with:

            -  major commercial airlines, many of which operate their own
               maintenance and overhaul units;

            -  OEMs, which manufacture, repair and overhaul their own parts; and

            -  other independent service companies.

    Electronic Technologies Group

         o  For the design and manufacture of various types of electronic and
            electro-optical equipment as well as high voltage interconnection
            devices and high speed interface products, we compete in a
            fragmented marketplace with a number of companies, some of which are
            well capitalized.

        The aviation aftermarket supply industry is highly fragmented, has
several highly visible leading companies, and is characterized by intense
competition. Some of our OEM competitors have greater name recognition than
HEICO, as well as complementary lines of business and financial, marketing and
other resources that HEICO does not have. In addition, OEMs, aircraft
maintenance providers, leasing companies and FAA-certificated repair facilities
may attempt to bundle their services and product offerings in the supply
industry, thereby significantly increasing industry competition. Moreover, our
smaller competitors may be able to offer more attractive pricing of parts as a
result of lower labor costs or

                                       12
<PAGE>

other factors. A variety of potential actions by any of our competitors,
including a reduction of product prices or the establishment by competitors of
long-term relationships with new or existing customers, could have a material
adverse effect on our business, financial condition and results of operations.
Competition typically intensifies during cyclical downturns in the aviation
industry, when supply may exceed demand. We may not be able to continue to
compete effectively against present or future competitors, and competitive
pressures may have a material and adverse effect on our business, financial
condition and results of operations.

Our success is dependent on the development and manufacture of new products,
equipment and services. Our inability to develop, manufacture and introduce new
products and services at profitable pricing levels could reduce our sales or
sales growth.

         The aviation, defense, space and electronics industries are constantly
undergoing development and change and, accordingly, new products, equipment and
methods of repair and overhaul service are likely to be introduced in the
future. In addition to manufacturing electronic and electro-optical equipment
and selected aerospace and defense components for OEMs and the U.S. government
and repairing jet engine and aircraft components, we re-design sophisticated
aircraft replacement parts originally developed by OEMs so that we can offer
the replacement parts for sale at substantially lower prices than those
manufactured by the OEMs. Consequently, we devote substantial resources to
research and product development. Technological development poses a number of
challenges and risks, including the following:

         o  We may not be able to successfully protect the proprietary interests
            we have in various aircraft parts, electronic and electro-optical
            equipment and our repair processes;

         o  As OEMs continue to develop and improve jet engines and aircraft
            components, we may not be able to re-design and manufacture
            replacement parts that perform as well as those offered by OEMs or
            we may not be able to profitably sell our replacement parts at lower
            prices than the OEMs;

         o  We may need to expend significant capital to:

              - purchase new equipment and machines,
              - train employees in new methods of production and service, and
              - fund the research and development of new products; and

         o  Development by our competitors of patents or methodologies that
            preclude us from the design and manufacture of aircraft replacement
            parts or electrical and electro-optical equipment could adversely
            affect our business, financial condition and results of operations.

         In addition, we may not be able to successfully develop new products,
equipment or methods of repair and overhaul service, and the failure to do so
could have a material adverse effect on our business, financial condition and
results of operations.

Product specification costs and requirements could cause an increase to our
costs to complete contracts.

         The costs to meet customer specifications and requirements could result
in us having to spend more to design or manufacture products and this could
reduce our profit margins on current contracts or those we obtain in the future.

                                       13
<PAGE>

We may incur product liability claims that are not fully insured.

         Our jet engine and aircraft component replacement parts and repair and
overhaul services expose our business to potential liabilities for personal
injury or death as a result of the failure of an aircraft component that we have
designed, manufactured or serviced. The commercial aviation industry
occasionally has catastrophic losses that may exceed policy limits. An uninsured
or partially insured claim, or a claim for which third-party indemnification is
not available, could have a material adverse effect on our business, financial
condition and results of operations. Additionally, insurance coverage costs may
become even more expensive in the future. Our customers typically require us to
maintain substantial insurance coverage and our inability to obtain insurance
coverage at commercially reasonable rates could have a material adverse effect
on our business.

We may not have the administrative, operational or financial resources to
continue to grow the company.

         We have experienced rapid growth in recent periods and intend to
continue to pursue an aggressive growth strategy, both through acquisitions and
internal expansion of products and services. Our growth to date has placed, and
could continue to place, significant demands on our administrative, operational
and financial resources. We may not be able to grow effectively or manage our
growth successfully, and the failure to do so could have a material adverse
effect on our business, financial condition and results of operations.

We may not be able to execute our acquisition strategy, which could slow our
growth.

          A key element of our strategy is growth through the acquisition of
additional companies. Our acquisition strategy is affected by and poses a number
of challenges and risks, including the following:

          o   Availability of suitable acquisition candidates;

          o   Availability of capital;

          o   Diversion of management's attention;

          o   Integration of the operations and personnel of acquired companies;

          o   Potential write downs of acquired intangible assets;

          o   Potential loss of key employees of acquired companies;

          o   Use of a significant portion of our available cash;

          o   Significant dilution to our shareholders for acquisitions made
              utilizing our securities; and

          o   Consummation of acquisitions on satisfactory terms.

         We may not be able to successfully execute our acquisition strategy,
and the failure to do so could have a material adverse effect on our business,
financial condition and results of operations.

We may incur environmental liabilities and these liabilities may not be covered
by insurance.

         Our operations and facilities are subject to a number of federal, state
and local environmental laws and regulations, which govern, among other things,
the discharge of hazardous materials into the air and water as well as the
handling, storage and disposal of hazardous materials. Pursuant to various
environmental laws, a current or previous owner or operator of real property may
be liable for the costs of removal or remediation of hazardous materials.
Environmental laws typically impose liability whether or not the owner or
operator knew of, or was responsible for, the presence of hazardous materials.
Although

                                       14
<PAGE>

management believes that our operations and facilities are in material
compliance with environmental laws and regulations, future changes in them or
interpretations thereof or the nature of our operations may require us to make
significant additional capital expenditures to ensure compliance in the future.

         We do not maintain specific environmental liability insurance and the
expenses related to these environmental liabilities, if we are required to pay
them, could have a material adverse effect on our business, financial condition
and results of operations.

We are dependent on key personnel and the loss of these key personnel could have
a material adverse effect on our success.

         Our success substantially depends on the performance, contributions and
expertise of our senior management team led by Laurans A. Mendelson, our
Chairman, President and Chief Executive Officer. Technical employees are also
critical to our research and product development, as well as our ability to
continue to re-design sophisticated products of OEMs in order to sell competing
replacement parts at substantially lower prices than those manufactured by the
OEMs. The loss of the services of any of our executive officers or other key
employees or our inability to continue to attract or retain the necessary
personnel could have a material adverse effect on our business, financial
condition and results of operations.

Our executive officers and directors have significant influence over our
management and direction.

         As December 19, 2008, collectively our executive officers and entities
controlled by them, our 401(k) Plan and members of the Board of Directors
beneficially owned approximately 27% of our outstanding Common Stock and
approximately 7% of our outstanding Class A Common Stock. Accordingly, they will
be able to substantially influence the election of the Board of Directors and
control our business, policies and affairs, including our position with respect
to proposed business combinations and attempted takeovers.

Item 1B. UNRESOLVED STAFF COMMENTS

         None.

                                       15
<PAGE>

Item 2. PROPERTIES

         The Company owns or leases a number of facilities, which are utilized
by its Flight Support Group ("FSG"), Electronic Technologies Group ("ETG") and
Corporate office. All of the facilities listed below are in good operating
condition, well maintained and in regular use. The Company believes that its
existing facilities are sufficient to meet its operational needs for the
foreseeable future. Summary information on the facilities utilized within the
FSG and the ETG to support their principal operating activities is as follows:

<TABLE>
<CAPTION>
Flight Support Group
--------------------
                                                  Square Footage
                                                  ---------------
      Location                                 Leased        Owned        Description
      --------                                --------      -------      --------------------------------------------
      <S>                                      <C>          <C>           <C>
      United States facilities (9 states)      324,000      159,000       Manufacturing, engineering and distribution
                                                                             facilities, and corporate headquarters
      United States facilities (6 states)      132,000      141,000       Repair and overhaul facilities
      International facilities (3 countries)     8,000           --       Manufacturing, engineering and distribution
           - India, Singapore and United                                     facilities
             Kingdom

Electronic Technologies Group
-----------------------------
                                                  Square Footage
                                                  ---------------
      Location                                 Leased        Owned        Description
      --------                                --------      -------      --------------------------------------------
      United States facilities (6 states)      154,000      76,000        Manufacturing and engineering facilities
      International facilities (2 countries)    52,000      12,000        Manufacturing and engineering facilities
         - Canada and United Kingdom

Corporate
---------
                                                  Square Footage
                                                  ---------------
      Location                                 Leased       Owned(1)      Description
      --------                                --------      -------      --------------------------------------------
      United States facilities (1 state)         --           4,000       Administrative offices
</TABLE>

(1)     Represents the square footage of corporate offices in Miami, Florida.
        The square footage of the Company's corporate headquarters in Hollywood,
        FL is included within the square footage under the caption "United
        States facilities (9 states)" under Flight Support Group.

Item 3.  LEGAL PROCEEDINGS

         The Company is involved in various legal actions arising in the normal
course of business. Based upon the Company's and its legal counsel's evaluations
of any claims or assessments, management is of the opinion that the outcome of
these matters will not have a material adverse effect on the Company's results
of operations or financial position.

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         There were no matters submitted to a vote of security holders during
the fourth quarter of fiscal 2008.

                                       16
<PAGE>

                                     PART II

Item 5.  MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
         AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

         The Company's Class A Common Stock and Common Stock are listed and
traded on the New York Stock Exchange ("NYSE") under the symbols "HEI.A" and
"HEI," respectively. The following tables set forth, for the periods indicated,
the high and low share prices for the Class A Common Stock and the Common Stock
as reported on the NYSE, as well as the amount of cash dividends paid per share
during such periods.

                              Class A Common Stock
                              ---------------------

                                                            Cash Dividends
                                   High           Low          Per Share
                                  ------         ------     --------------
    Fiscal 2007:
        First Quarter             $33.01         $28.72               $.04
        Second Quarter             34.29          29.10                 --
        Third Quarter              37.58          30.65                .04
        Fourth Quarter             44.36          32.65                 --

    Fiscal 2008:
        First Quarter             $44.63         $32.05               $.05
        Second Quarter             42.24          32.80                 --
        Third Quarter              41.68          24.87                .05
        Fourth Quarter             36.19          19.82                 --

         As of December 19, 2008, there were 672 holders of record of the
Company's Class A Common Stock.

                                  Common Stock
                                  ------------

                                                            Cash Dividends
                                   High           Low          Per Share
                                  ------         ------     --------------
    Fiscal 2007:
        First Quarter             $40.07         $34.01               $.04
        Second Quarter             40.35          33.76                 --
        Third Quarter              44.43          35.81                .04
        Fourth Quarter             54.52          39.51                 --

    Fiscal 2008:
        First Quarter             $56.92         $42.00               $.05
        Second Quarter             52.78          41.80                 --
        Third Quarter              54.35          30.16                .05
        Fourth Quarter             48.27          26.49                 --

         As of December 19, 2008, there were 652 holders of record of the
Company's Common Stock.

                                       17
<PAGE>

Performance Graphs

         The following graph and table compare the total return on $100 invested
in HEICO Common Stock and HEICO Class A Common Stock with the total return of
$100 invested in the New York Stock Exchange (NYSE) Composite Index and the Dow
Jones U.S. Aerospace Index for the five-year period from October 31, 2003
through October 31, 2008. The NYSE Composite Index measures all common stock
listed on the NYSE. The Dow Jones U.S. Aerospace Index is comprised of large
companies which make aircraft, major weapons, radar and other defense equipment
and systems as well as providers of satellites used for defense purposes. The
total returns include the reinvestment of cash dividends.

                 Comparison of Five-Year Cumulative Total Return

                              [CHART APPEARS HERE]

<TABLE>
<CAPTION>
                                           Cumulative Total Return as of October 31,
                                  ---------------------------------------------------------
                                    2003      2004      2005      2006      2007      2008
                                  -------   -------   -------   -------   -------   -------
<S>                               <C>       <C>       <C>       <C>       <C>       <C>
HEICO Common Stock (1)            $100.00   $127.76   $156.79   $258.85   $388.10   $273.25
HEICO Class A Common Stock (1)     100.00    128.44    156.98    278.92    403.94    262.51
NYSE Composite Index               100.00    112.31    124.74    147.26    173.04    101.71
Dow Jones U.S. Aerospace Index     100.00    121.70    147.45    192.78    254.54    153.28
</TABLE>

-------------------------

(1) Information has been adjusted retroactively to give effect to a 10% stock
    dividend paid in shares of Class A Common Stock in January 2004.

                                       18
<PAGE>

         The following graph and table compare the total return on $100 invested
in HEICO Common Stock since October 31, 1990 using the same indices shown on the
five-year performance graph on the previous page. October 31, 1990 was the end
of the first fiscal year following the date the current executive management
team assumed leadership of the Company. No Class A Common Stock was outstanding
as of October 31, 1990. As with the five-year performance graph, the total
returns include the reinvestment of cash dividends.

               Comparison of Eighteen-Year Cumulative Total Return

                              [CHART APPEARS HERE]

<TABLE>
<CAPTION>
                                                           Cumulative Total Return as of October 31,
                                    --------------------------------------------------------------------------------------
                                       1990         1991        1992         1993        1994          1995        1996
                                    ---------    ---------    ---------    ---------   ---------      -------    ---------
<S>                                   <C>          <C>          <C>         <C>          <C>          <C>          <C>
HEICO Common Stock (1)                $100.00      $141.49      $158.35     $173.88      $123.41      $263.25      $430.02
NYSE Composite Index                   100.00       130.31       138.76      156.09       155.68       186.32       225.37
Dow Jones U.S. Aerospace Index         100.00       130.67       122.00      158.36       176.11       252.00       341.65

<CAPTION>
                                       1997         1998         1999        2000        2001          2002        2003
                                    ---------    ---------    ---------    ---------   ---------      -------    ---------
<S>                                 <C>          <C>          <C>           <C>        <C>            <C>        <C>
HEICO Common Stock (1)              $1,008.31    $1,448.99    $1,051.61     $809.50    $1,045.86      $670.39    $1,067.42
NYSE Composite Index                   289.55       326.98       376.40      400.81       328.78       284.59       339.15
Dow Jones U.S. Aerospace Index         376.36       378.66       295.99      418.32       333.32       343.88       393.19

<CAPTION>
                                      2004         2005         2006         2007         2008
                                    ---------    ---------    ---------    ---------   ---------
<S>                                 <C>          <C>          <C>           <C>        <C>
HEICO Common Stock (1)              $1,366.57    $1,674.40    $2,846.48    $4,208.54   $2,872.01
NYSE Composite Index                   380.91       423.05       499.42       586.87      344.96
Dow Jones U.S. Aerospace Index         478.49       579.77       757.97     1,000.84      602.66
</TABLE>

-------------------------

(1) Information has been adjusted retroactively to give effect to all stock
    dividends paid during the eighteen-year period.

                                       19
<PAGE>

Dividend Policy

         The Company has historically paid semi-annual cash dividends on both
its Class A Common Stock and Common Stock. In July 2008, HEICO paid its 60th
consecutive semi-annual cash dividend since 1979. HEICO's Board of Directors
presently intends to continue the payment of regular semi-annual cash dividends
on both classes of its common stock. In December 2008, the Board of Directors
declared a regular semi-annual cash dividend of $.06 per share payable in
January 2009. The cash dividend represents a 20% increase over the prior per
share amount of $.05. The Company's ability to pay dividends could be affected
by future business performance, liquidity, capital needs, alternative investment
opportunities and loan covenants under its revolving credit facility.

Equity Compensation Plan Information

         The following table summarizes information about the Company's equity
compensation plans as of October 31, 2008.

<TABLE>
<CAPTION>
                                                                                                 Number of Securities
                                                                                               Remaining Available for
                                            Number of Securities                                Future Issuance Under
                                            to be Issued Upon         Weighted-Average           Equity Compensation
                                                Exercise of          Exercise Price of             Plans (Excluding
                                            Outstanding Options,    Outstanding Options,        Securities Reflected in
                                             Warrants and Rights    Warrants and Rights              Column (a))
Plan Category                                       (a)                     (b)                           (c)
------------------------------------        ---------------------   ---------------------       ------------------------
<S>                                                    <C>                         <C>                        <C>
Equity compensation plans
    approved by security holders (1)                   1,456,742                   $10.11                     1,663,564

Equity compensation plans not
    approved by security holders (2)                     167,000                    $7.36                            --
                                            ---------------------                                -----------------------
Total                                                  1,623,742                    $9.83                     1,663,564
                                            =====================                                =======================
</TABLE>

------------------
(1) Represents aggregated information pertaining to the Company's three equity
    compensation plans: the 1993 Stock Option Plan, the Non-Qualified Stock
    Option Plan and the 2002 Stock Option Plan. See Note 8, Stock Options, of
    the Notes to Consolidated Financial Statements for further information
    regarding these plans.

(2) Represents stock options granted to a former shareholder of a business
    acquired in fiscal 1999. Such stock options were fully vested and
    transferable as of the grant date and expire ten years from the date of
    grant. The exercise price of such options was the fair market value as of
    the date of grant.

Issuer Purchases of Equity Securities

        As announced by the Company on October 21, 2002, the Company's Board of
Directors has authorized the repurchase of up to 425,000 shares of its Class A
Common Stock and/or Common Stock to be executed, at management's discretion, in
the open market or via private transactions. From October 21, 2002 through
October 31, 2003, the Company repurchased 22,000 shares of its Class A Common
Stock. The remaining 403,000 shares authorized for repurchase are subject to
certain restrictions included in the Company's revolving credit agreement. The
Company did not repurchase any shares of its Class A Common Stock and/or Common
Stock during fiscal 2008, 2007 or 2006. The repurchase program does not have a
fixed termination date.

                                       20
<PAGE>

Item 6.  SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
                                                                           For the year ended October 31, (1)
                                                     -------------------------------------------------------------------------
                                                       2004                2005         2006             2007           2008
                                                     --------            --------     --------         --------       --------
                                                                       (in thousands, except per share data)
<S>                                                  <C>                 <C>          <C>              <C>            <C>
Operating Data:
Net sales                                            $215,744            $269,647     $392,190         $507,924       $582,347
Gross profit                                           75,812             100,996      142,513          177,458        210,495
Selling, general and administrative expenses           43,193              56,347       75,646           91,444        104,707
Operating income                                       32,619 (2)          44,649       66,867           86,014        105,788 (6)
Interest expense                                        1,090               1,136        3,523            3,293          2,314
Interest and other income (expense)                        26                 528          639               95           (637)
Life insurance proceeds                                 5,000 (3)              --           --               --             --
Net income                                             20,630 (2)(3)       22,812       31,888 (4)       39,005 (5)     48,511 (6)

Weight average number of common shares outstanding:
   Basic                                               24,037              24,460       25,085           25,716         26,309
   Diluted                                             25,755              26,323       26,598           26,931         27,243
Per Share Data:
Net income:
   Basic                                                 $.86 (2)(3)         $.93        $1.27 (4)        $1.52 (5)      $1.84 (6)
   Diluted                                                .80 (2)(3)          .87         1.20 (4)         1.45 (5)       1.78 (6)
Cash dividends                                            .05                 .05          .08              .08            .10
Balance Sheet Data (as of October 31:)
Cash and cash equivalents                               $214               $5,330       $4,999           $4,947        $12,562
Total assets                                          364,255             435,624      534,815          631,302        676,542
Total debt (including current portion)                 18,129              34,124       55,061           55,952         37,601
Minority interests in consolidated subsidiaries        44,644              49,035       63,301           72,938         83,978
Shareholders' equity                                  247,402             273,503      317,258          371,601        417,760
</TABLE>

------------------
(1) Results include the results of acquisitions from each respective effective
    date.

(2) Operating income was reduced by an aggregate of $850 in restructuring
    expenses recorded by certain subsidiaries of the Flight Support Group that
    provide repair and overhaul services, including $350 recorded within cost of
    sales and $500 recorded within selling, general and administrative expenses.
    The restructuring expenses decreased net income by $427, or $.02 per basic
    and diluted share.

(3) Represents proceeds from a $5,000 key-person life insurance policy
    maintained by a subsidiary of the Flight Support Group. The minority
    interest's share of this income totaled $1,000, which is reported as a
    component of minority interests' share of income. Accordingly, the life
    insurance proceeds increased net income by $4,000, or $.17 per basic and
    $.16 per diluted share.

(4) Includes the benefit of a tax credit (net of related expenses) for qualified
    research and development activities claimed for certain prior years, which
    increased net income by $1,002, or $.04 per basic and diluted share.

(5) Includes the benefit of a tax credit (net of related expenses) for qualified
    research and development activities recognized for the full fiscal 2006 year
    pursuant to the retroactive extension in December 2006 of Section 41,
    "Credit for Increasing Research Activities," of the Internal Revenue Code,
    which increased net income by $535, or $.02 per basic and diluted share.

(6) Operating income was reduced by an aggregate of $1,835 in impairment losses
    related to the write-down of certain intangible assets within the
    Electronic Technologies Group to their estimated fair values. The impairment
    losses were recorded as a component of selling, general and administrative
    expenses and decreased net income by $1,140, or $.04 per basic and diluted
    share.

                                       21
<PAGE>

Item 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

Overview

          The Company's operations are comprised of two operating segments, the
Flight Support Group ("FSG") and the Electronic Technologies Group ("ETG").

          The Flight Support Group consists of HEICO Aerospace Holdings Corp.
("HEICO Aerospace") and its subsidiaries, which primarily:

        o Designs, Manufactures, Repairs and Distributes Jet Engine and Aircraft
          Component Replacement Parts. The Flight Support Group designs,
          manufactures, repairs and distributes jet engine and aircraft
          component replacement parts. The parts and services are approved by
          the Federal Aviation Administration ("FAA"). The Flight Support Group
          also manufactures and sells specialty parts as a subcontractor for
          aerospace and industrial original equipment manufacturers and the
          United States government.

          The Electronic Technologies Group consists of HEICO Electronic
Technologies Corp. ("HEICO Electronic") and its subsidiaries, which primarily:

        o Designs and Manufactures Electronic, Microwave and Electro-Optical
          Equipment, High-Speed Interface Products, High Voltage Interconnection
          Devices and High Voltage Advanced Power Electronics. The Electronic
          Technologies Group designs, manufactures and sells various types of
          electronic, microwave and electro-optical equipment and components,
          including power supplies, laser rangefinder receivers, infrared
          simulation, calibration and testing equipment; electromagnetic
          interference shielding for commercial and military aircraft operators,
          electronics companies and telecommunication equipment suppliers;
          advanced high-technology interface products that link devices such as
          telemetry receivers, digital cameras, high resolution scanners,
          simulation systems and test systems to computers; high voltage energy
          generators interconnection devices, cable assemblies and wire for the
          medical equipment, defense and other industrial markets; and high
          frequency power delivery systems for the commercial sign industry.

          The Company's results of operations during each of the past three
fiscal years have been affected by a number of transactions. This discussion of
the Company's financial condition and results of operations should be read in
conjunction with the Consolidated Financial Statements and Notes thereto
included herein. For further information regarding the acquisitions discussed
below, see Note 2, Acquisitions, of the Notes to Consolidated Financial
Statements. The acquisitions have been accounted for using the purchase method
of accounting and are included in the Company's results of operations from the
effective dates of acquisition.

          In May 2006 and September 2006, the Company, through HEICO Aerospace,
acquired all of the stock of Arger Enterprises, Inc. and its related companies
(collectively "Arger") and an 80% interest in Prime Air, Inc. and its affiliate
(collectively "Prime"), respectively. Under the Prime transaction, a new
subsidiary was formed, Prime Air, LLC ("Prime Air"), which acquired
substantially all of the assets and assumed certain liabilities of Prime. Prime
Air is owned 80% by the Company and 20% by certain members of Prime's management
group.

          In April and September 2007, the Company, through HEICO Electronic,
acquired all of the stock of FerriShield, Inc. ("FerriShield") and EMD
Technologies Inc. ("EMD"), respectively. In May 2007 and August 2007, the
Company, through HEICO Aerospace, acquired certain assets of a supplier and

                                       22
<PAGE>

substantially all of the assets of a U.S. company that designs and manufactures
FAA-approved aircraft and engine parts, respectively. The purchase price of the
supplier's assets was paid using cash provided by operating activities.

          During the first quarter of fiscal 2007, the Company, through HEICO
Aerospace, acquired an additional 10% of the equity interests in one of its
subsidiaries, which increased the Company's ownership interest to 90%. During
both April 2007 and 2008, the Company, through HEICO Electronic, acquired an
additional .75% of the equity interests in one of its subsidiaries, which
increased the Company's ownership interest from 85% to 86.5%. The purchase
prices of the acquired equity interests were paid using cash provided by
operating activities.

          In November 2007, the Company, through an 80%-owned subsidiary of
HEICO Aerospace, acquired all of the stock of a European company that supplies
aircraft parts for sale and exchange and provides repair management services. In
January and February 2008, the Company, through HEICO Aerospace, acquired
certain assets and assumed certain liabilities of a U.S. company that designs
and manufactures FAA-approved aircraft and engine parts and acquired an 80%
interest in certain assets and certain liabilities of a U.S. company that is an
FAA-approved repair station which specializes in avionics, respectively. The
remaining 20% of the repair station's equity interests are principally owned by
certain members of the acquired company's management.

          In April 2008, the Company, through HEICO Aerospace, acquired an
additional 7% of the equity interests in one of its subsidiaries, which
increased the Company's ownership interest to 58%.

          The purchase price of each fiscal 2007 and 2008 acquisition was paid
in cash using proceeds from the Company's revolving credit facility unless
otherwise noted and was not significant to the Company's consolidated financial
statements individually.

Critical Accounting Policies

          The Company believes that the following are its most critical
accounting policies, some of which require management to make judgments about
matters that are inherently uncertain.

Revenue Recognition

          Revenue is recognized on an accrual basis, primarily upon the shipment
of products and the rendering of services. Revenue from certain fixed price
contracts for which costs can be dependably estimated is recognized on the
percentage-of-completion method, measured by the percentage of costs incurred
to date to estimated total costs for each contract. This method is used because
management considers costs incurred to be the best available measure of progress
on these contracts. Variations in actual labor performance, changes to estimated
profitability and final contract settlements may result in revisions to cost
estimates. Revisions in cost estimates as contracts progress have the effect of
increasing or decreasing profits in the period of revision. Provisions for
estimated losses on uncompleted contracts are made in the period in which such
losses are determined. For fixed price contracts in which costs cannot be
dependably estimated, revenue is recognized on the completed-contract method. A
contract is considered complete when all significant costs have been incurred or
the item has been accepted by the customer. The percentage of the Company's net
sales recognized under the percentage-of-completion method was approximately
3%, 3% and 4% in fiscal 2008, 2007 and 2006, respectively. The aggregate effects
of changes in estimates relating to long-term contracts did not have a
significant effect on net income or diluted net income per share in fiscal 2008,
2007 or 2006.

                                       23
<PAGE>

Valuation of Accounts Receivable

          The valuation of accounts receivable requires that the Company set up
an allowance for estimated uncollectible accounts and record a corresponding
charge to bad debt expense. The Company estimates uncollectible receivables
based on such factors as its prior experience, its appraisal of a customer's
ability to pay and economic conditions within and outside of the aviation,
defense, space and electronics industries. Actual bad debt expense could differ
from estimates made.

Valuation of Inventory

          Inventory is stated at the lower of cost or market, with cost being
determined on the first-in, first-out or the average cost basis. Losses, if
any, are recognized fully in the period when identified.

          The Company periodically evaluates the carrying value of inventory,
giving consideration to factors such as its physical condition, sales patterns
and expected future demand and estimates the amount necessary to write-down its
slow moving, obsolete or damaged inventory. These estimates could vary
significantly from actual amounts based upon future economic conditions,
customer inventory levels, or competitive factors that were not foreseen or did
not exist when the estimated write-downs were made.

Purchase Accounting

          The Company applies the purchase method of accounting to its
acquisitions. Under this method, the purchase price, including any capitalized
acquisition costs, is allocated to the underlying tangible and identifiable
intangible assets acquired and liabilities assumed based on their estimated fair
market values, with any excess recorded as goodwill. Determining the fair value
of assets acquired and liabilities assumed requires management's judgment and
often involves the use of significant estimates and assumptions, including
assumptions with respect to future cash inflows and outflows, discount rates,
asset lives and market multiples, among other items. The Company determines the
fair values of such assets, principally intangible assets, generally in
consultation with third-party valuation advisors.

Valuation of Goodwill and Other Intangible Assets

          The Company tests goodwill for impairment annually as of October 31,
or more frequently if events or changes in circumstances indicate that the
carrying amount of goodwill may not be fully recoverable. The test requires the
Company to compare the fair value of each of its reporting units to its
carrying value to determine potential impairment. If the carrying value of a
reporting unit exceeds its fair value, the implied fair value of that reporting
unit's goodwill is to be calculated and an impairment loss is recognized in the
amount by which the carrying value of a reporting unit's goodwill exceeds its
implied fair value, if any. The determination of fair value requires the Company
to make a number of estimates, assumptions and judgments of such factors as
earnings multiples, projected revenues and operating expenses and the Company's
weighted average cost of capital. If there is a material change in such
assumptions used by the Company in determining fair value or if there is a
material change in the conditions or circumstances influencing fair value, the
Company could be required to recognize a material impairment charge. Based on
the annual goodwill test for impairment as of October 31, 2008, the Company
determined there is no impairment of its goodwill.

          The Company tests each non-amortizing intangible asset for impairment
annually as of October 31, or more frequently if events or changes in
circumstances indicate that the asset might be impaired. The Company also tests
each amortizing intangible asset for impairment if events or circumstances
indicate that the asset might be impaired. These tests consist of determining
whether the carrying value of such assets will be recovered through undiscounted
expected future cash flows. If the total of the

                                       24
<PAGE>

undiscounted future cash flows is less than the carrying amount of those assets,
the Company recognizes an impairment loss based on the excess of the carrying
amount over the fair value of the assets. The determination of fair value
requires the Company to make a number of estimates, assumptions and judgments
of such factors as projected revenues and earnings and from discount rates.
Based on the impairment tests conducted during fiscal 2008, the Company
recognized pre-tax impairment losses of $1.3 million and $.5 million related to
the write-down of certain customer relationships and trade names, respectively,
within the ETG to their estimated fair values. The impairment losses were
recorded as a component of selling, general and administrative expenses in the
Company's Consolidated Statements of Operations.

Results of Operations

          The following table sets forth the results of the Company's
operations, net sales and operating income by operating segment and the
percentage of net sales represented by the respective items in the Company's
Consolidated Statements of Operations:

<TABLE>
<CAPTION>
                                                              For the year ended October 31,
                                                    -------------------------------------------------
                                                       2008                2007              2006
                                                    ------------       ------------      ------------
<S>                                                 <C>                <C>               <C>
Net sales                                           $582,347,000       $507,924,000      $392,190,000
                                                    ------------       ------------      ------------
Cost of sales                                        371,852,000        330,466,000       249,677,000
Selling, general and administrative expenses         104,707,000         91,444,000        75,646,000
                                                    ------------       ------------      ------------
Total operating costs and expenses                   476,559,000        421,910,000       325,323,000
                                                    ------------       ------------      ------------
Operating income                                    $105,788,000        $86,014,000       $66,867,000
                                                    ============       ============      ============

Net sales by segment:
    Flight Support Group                            $436,810,000       $383,911,000      $277,255,000
    Electronic Technologies Group                    146,044,000        124,035,000       115,021,000
    Intersegment sales                                  (507,000)           (22,000)          (86,000)
                                                    ------------       ------------      ------------
                                                    $582,347,000       $507,924,000      $392,190,000
                                                    ============       ============      ============

Operating income by segment:
    Flight Support Group                             $81,184,000        $67,408,000       $46,840,000
    Electronic Technologies Group                     38,775,000         33,870,000        34,026,000
    Other, primarily corporate                       (14,171,000)       (15,264,000)      (13,999,000)
                                                    ------------       ------------      ------------
                                                    $105,788,000        $86,014,000       $66,867,000
                                                    ============       ============      ============

Net sales                                                 100.0%             100.0%            100.0%
Gross profit                                               36.1%              34.9%             36.3%
Selling, general and administrative expenses               18.0%              18.0%             19.3%
Operating income                                           18.2%              16.9%             17.0%
Interest expense                                            0.4%               0.6%              0.9%
Interest and other (expense) income                        (0.1%)              0.0%              0.2%
Income tax expense                                          6.1%               5.4%              5.3%
Minority interests' share of income                         3.2%               3.2%              2.9%
Net income                                                  8.3%               7.7%              8.1%
</TABLE>

                                       25
<PAGE>

Comparison of Fiscal 2008 to Fiscal 2007

Net Sales

         Net sales in fiscal 2008 increased by 14.7% to $582.3 million, as
compared to net sales of $507.9 million in fiscal 2007. The increase in net
sales reflects an increase of $52.9 million (a 13.8% increase) to $436.8 million
in net sales within the FSG and an increase of $22.0 million (a 17.7% increase)
to $146.0 million in net sales within the ETG. The FSG's net sales increase
reflects organic growth of approximately 10% as well as the impact on net sales
from the fiscal 2008 acquisitions. The organic growth principally represents
higher sales of new products and services and increased demand for the FSG's
aftermarket replacement parts and repair and overhaul services. The ETG's net
sales increase reflects the impact on net sales from prior year acquisitions as
well as organic growth of approximately 9% principally due to increased demand
for certain products.

         The Company's net sales in both fiscal 2008 and 2007 by market
approximated 69% from the commercial aviation industry, 16% from the defense and
space industries and 15% from other industrial markets including medical,
electronics and telecommunications.

Gross Profit and Operating Expenses

         The Company's gross profit margin increased to 36.1% in fiscal 2008 as
compared to 34.9% in fiscal 2007, principally reflecting higher margins within
the FSG and the ETG primarily due to a more favorable product mix. Consolidated
cost of sales in fiscal 2008 and 2007 includes approximately $18.4 million and
$16.5 million, respectively, of new product research and development expenses.

         Selling, general and administrative ("SG&A") expenses were $104.7
million and $91.4 million in fiscal 2008 and 2007, respectively. The increase in
SG&A expenses was mainly due to higher operating costs, principally personnel
related, associated with the growth in net sales discussed above and the
additional operating costs associated with the acquired businesses. As a
percentage of net sales, SG&A expenses were 18.0% in fiscal 2008 and 2007.

Operating Income

         Operating income in fiscal 2008 increased by 23.0% to $105.8 million,
compared to operating income of $86.0 million in fiscal 2007. The increase in
operating income reflects an increase of $13.8 million (a 20.4% increase) to
$81.2 million in operating income of the FSG in fiscal 2008, an increase of $4.9
million (a 14.5% increase) to $38.8 million in operating income of the ETG in
fiscal 2008 and a $1.1 million decrease in corporate expenses.

         As a percentage of net sales, operating income increased to 18.2% in
fiscal 2008 compared to 16.9% in fiscal 2007. The increase in operating income
as a percentage of net sales reflects an increase in the FSG's operating income
as a percentage of net sales to 18.6% in fiscal 2008 compared to 17.6% in fiscal
2007, partially offset by a decrease in the ETG's operating income as a
percentage of net sales from 27.3% in fiscal 2007 to 26.6% in fiscal 2008. The
increase in the FSG's operating income as a percentage of net sales principally
reflects the aforementioned increased gross profit margins. The decrease in the
ETG's operating income as a percentage of net sales principally reflects an
aggregate of $1.8 million in impairment losses related to the write-down of
certain intangible assets to their estimated fair values recognized in fiscal
2008.

                                       26
<PAGE>

Interest Expense

         Interest expense decreased to $2.3 million in fiscal 2008 from $3.3
million in fiscal 2007. The decrease was principally due to lower interest
rates.

Interest and Other (Expense) Income

         Interest and other (expense) income in fiscal 2008 and 2007 were not
material.

Income Tax Expense

         The Company's effective tax rate for fiscal 2008 increased to 34.5%
from 33.2% in fiscal 2007. The increase was principally related to the December
2006 retroactive extension for the two year period covering January 1, 2006 to
December 31, 2007 of Section 41, "Credit for Increasing Research Activities," of
the Internal Revenue Code. As a result of this retroactive extension, the
Company recognized an income tax credit for qualified research and development
activities for the full fiscal 2006 year in fiscal 2007, which increased net
income, net of expenses, by approximately $.5 million.

       For a detailed analysis of the provision for income taxes, see Note 6,
Income Taxes, of the Notes to Consolidated Financial Statements.

Minority Interests' Share of Income

         Minority interests' share of income of consolidated subsidiaries
relates to the 20% minority interests held in HEICO Aerospace and the minority
interests held in certain subsidiaries of HEICO Aerospace and HEICO Electronic.
The increase in the minority interests' share of income in fiscal 2008 compared
to fiscal 2007 was attributable to the higher earnings of the FSG and certain
ETG subsidiaries in which the minority interests exist.

Net Income

         The Company's net income was $48.5 million, or $1.78 per diluted share,
in fiscal 2008 compared to $39.0 million, or $1.45 per diluted share, in fiscal
2007 reflecting the increased operating income referenced above, partially
offset by the increased minority interests' share of certain consolidated
subsidiaries.

Outlook

         As the Company looks forward to fiscal 2009, HEICO will continue its
focus on developing new products and services, further market penetration,
additional acquisition opportunities and maintaining its financial strength. The
Company is targeting growth in net sales, earnings and net cash provided by
operating activities in fiscal 2009 over fiscal 2008 results despite the global
economic strains facing its markets and customers, including the impact of
expected capacity reductions in the commercial airline industry.

                                       27
<PAGE>

Comparison of Fiscal 2007 to Fiscal 2006

Net Sales

         Net sales in fiscal 2007 increased by 29.5% to $507.9 million, as
compared to net sales of $392.2 million in fiscal 2006. The increase in net
sales reflects an increase of $106.7 million (a 38.5% increase) to $383.9
million in net sales within the FSG and an increase of $9.0 million (a 7.8%
increase) to $124.0 million in net sales within the ETG. The FSG's net sales
increase reflects organic growth of approximately 21% and certain prior year
acquisitions, principally Arger and Prime Air. The organic growth reflects
increased sales of new products and services and continued increased demand for
the FSG's aftermarket replacement parts and repair and overhaul services within
the commercial airline industry. The ETG's net sales increase reflects organic
growth of approximately 5% as well as the impact on net sales from the fiscal
2007 acquisitions. The organic growth principally reflects increased demand for
certain products.

         The Company's net sales in fiscal 2007 by market approximated 69% from
the commercial aviation industry, 16% from the defense and space industries and
15% from other industrial markets including medical, electronics and
telecommunications. The Company's net sales in fiscal 2006 by market
approximated 64% from the commercial aviation industry, 19% from the defense
and space industries and 17% from other industrial markets including medical,
electronics and telecommunications.

Gross Profit and Operating Expenses

         The Company's gross profit margin decreased to 34.9% in fiscal 2007 as
compared to 36.3% in fiscal 2006, reflecting lower margins within the ETG due
principally to a less favorable product mix. Consolidated cost of sales in
fiscal 2007 and 2006 includes approximately $16.5 million and $15.3 million,
respectively, of new product research and development expenses.

         SG&A expenses were $91.4 million and $75.6 million in fiscal 2007 and
2006, respectively. The increase in SG&A expenses was mainly due to higher
operating costs, principally personnel related, associated with the growth in
net sales discussed above including acquisitions and an increase in corporate
expenses. The increase in corporate expenses reflects higher compensation and
performance awards based on improvement in consolidated operating results.

         As a percentage of net sales, SG&A expenses decreased to 18.0% in
fiscal 2007 compared to 19.3% in fiscal 2006. The decrease as a percentage of
net sales is due to efficiencies in controlling costs while increasing revenues.

Operating Income

         Operating income in fiscal 2007 increased by 28.6% to $86.0 million,
compared to operating income of $66.9 million in fiscal 2006. The increase in
operating income reflects an increase of $20.6 million (a 43.9% increase) to
$67.4 million in operating income of the FSG in fiscal 2007, partially offset
by a $.2 million decrease (a .5% decrease) in operating income of the ETG to
$33.9 million in fiscal 2007 and a $1.3 million increase in corporate expenses
as discussed above.

         As a percentage of net sales, operating income decreased slightly to
16.9% in fiscal 2007 compared to 17.0% in fiscal 2006. The decrease in operating
income as a percentage of net sales reflects a decrease in the ETG's operating
income as a percentage of net sales from 29.6% in fiscal 2006 to 27.3% in fiscal
2007, partially offset by an increase in the FSG's operating income as a
percentage of net sales from 16.9% in fiscal 2006 to 17.6% in fiscal 2007. The
decrease in the ETG's operating income as a

                                       28
<PAGE>

percentage of net sales principally reflects the lower gross profit margins
discussed previously. The increase in the FSG's operating income as a percentage
of net sales reflects the increase in net sales and operating efficiencies
within SG&A expenses.

Interest Expense

         Interest expense decreased to $3.3 million in fiscal 2007 from $3.5
million in fiscal 2006. The decrease was principally due to a lower weighted
average balance outstanding under the revolving credit facility in fiscal 2007,
partially offset by higher interest rates. Additional information about the
Company's revolving credit facility may be found within " Financing Activities,"
which follows within this Item 7.

Interest and Other Income

         Interest and other income in fiscal 2007 and 2006 were not material.

Income Tax Expense

         The Company's effective tax rate for fiscal 2007 increased to 33.2%
from 32.7% in fiscal 2006. The increase is principally due to the phase-out of
the extraterritorial income ("ETI") exclusion provisions pursuant to the
American Jobs Creation Act of 2004 that had resulted in a tax benefit on export
sales, partially offset by a higher amount of the minority interests' share of
income excluded from the Company's 2007 consolidated income subject to federal
income taxes.

         The effective tax rate for fiscal 2007 reflects an income tax credit
(net of expenses) for qualified research and development activities recognized
for the full fiscal 2006 year in fiscal 2007. The fiscal 2006 tax credit was
recorded pursuant to the December 2006 retroactive extension for the two year
period covering January 1, 2006 to December 31, 2007 of Section 41, "Credit for
Increasing Research Activities," of the Internal Revenue Code and increased net
income by approximately $.5 million in fiscal 2007.

         Income tax expense in fiscal 2006 includes an income tax credit for
qualified research and development activities claimed in the Company's income
tax return for fiscal 2005 and amended returns for previous tax years that were
filed in fiscal 2006. The aggregate tax credit, net of expenses, increased net
income by approximately $1.0 million in fiscal 2006.

         For a detailed analysis of the provision for income taxes, see Note 6,
Income Taxes, of the Notes to Consolidated Statements of Operations.

Minority Interests' Share of Income

         Minority interests' share of income of consolidated subsidiaries
relates to the 20% minority interest held in HEICO Aerospace and the minority
interests held in certain subsidiaries of HEICO Aerospace and HEICO Electronic.
The increase in the minority interests' share of income in fiscal 2007 compared
to fiscal 2006 is primarily attributable to the higher earnings of the FSG as
well as the September 2006 acquisition of Prime Air.

Net Income

         The Company's net income was $39.0 million, or $1.45 per diluted share,
in fiscal 2007 compared to $31.9 million, or $1.20 per diluted share, in fiscal
2006 reflecting the increased operating

                                       29
<PAGE>

income referenced above, partially offset by the increased minority interests'
share of certain consolidated subsidiaries.

Inflation

         The Company has generally experienced increases in its costs of labor,
materials and services consistent with overall rates of inflation. The impact of
such increases on the Company's net income has been generally minimized by
efforts to lower costs through manufacturing efficiencies and cost reductions.

Liquidity and Capital Resources

         The Company's capitalization was as follows:

                                                     As of October 31,
                                              ------------------------------
                                                 2008                2007
                                              -----------        -----------
  Cash and cash equivalents                   $12,562,000         $4,947,000
  Total debt (including current portion)       37,601,000         55,952,000
  Shareholders' equity                        417,760,000        371,601,000
  Total capitalization (debt plus equity)     455,361,000        427,553,000
  Total debt to total capitalization                   8%                13%

         In addition to cash and cash equivalents of $12.6 million, the Company
had $261.6 million of unused availability under the terms of its revolving
credit facility as of October 31, 2008. The Company's principal uses of cash
include acquisitions, payments of principal and interest on debt, capital
expenditures, cash dividends and increases in working capital. The Company
finances its activities primarily from its operating activities and financing
activities, including borrowings under short-term and long-term credit
agreements.

         Based on the Company's current outlook, the Company believes that its
net cash provided by operating activities and available borrowings under its
revolving credit facility will be sufficient to fund cash requirements for the
foreseeable future.

Operating Activities

         Net cash provided by operating activities was $73.2 million for fiscal
2008, principally reflecting net income of $48.5 million, minority interests'
share of income of $18.9 million, depreciation and amortization of $15.1
million, a tax benefit related to stock option exercises of $6.2 million,
deferred income tax provision of $3.6 million and impairment losses of
intangible assets aggregating $1.8 million, partially offset by an increase in
net operating assets of $17.1 million and the presentation of $4.3 million of
excess tax benefit from stock option exercises as a financing activity. The
increase in net operating assets (current assets used in operating activities
net of current liabilities) primarily reflects a higher investment in
inventories by the FSG required to meet sales demand associated with new product
offerings, sales growth, and increased lead times on certain raw materials; and
an increase in accounts receivable due to sales growth; partially offset by
higher current liabilities associated with increased sales and purchases and
higher accrued employee compensation and related payroll taxes.

         Net cash provided by operating activities was $57.5 million for fiscal
2007, principally reflecting net income of $39.0 million, minority interests'
share of income of $16.3 million, depreciation and amortization of $12.2
million, a tax benefit related to stock option exercises of $6.9 million, and a
deferred income tax provision of $2.8 million, partially offset by an increase
in net operating assets of

                                       30
<PAGE>

$16.0 million and the presentation of $5.3 million of excess tax benefit from
stock option exercises as a financing activity. The increase in net operating
assets primarily reflects a higher investment in inventories by the FSG required
to meet increased sales demand associated with new product offerings, sales
growth, improved product delivery times, and higher prices of certain raw
materials; and an increase in accounts receivable due to sales growth; partially
offset by higher current liabilities associated with increased sales and
purchases and higher accrued employee compensation and related payroll taxes.

         Net cash provided by operating activities was $46.9 million for fiscal
2006, principally reflecting net income of $31.9 million, minority interests'
share of income of $11.2 million, depreciation and amortization of $10.6
million, a tax benefit related to stock option exercises of $2.2 million, a
deferred income tax provision of $2.6 million, and stock option compensation
expense of $1.4 million, partially offset by an increase in net operating assets
of $12.0 million and the presentation of $1.6 million of excess tax benefit from
stock option exercises as a financing activity. The increase in net operating
assets primarily reflects a higher investment in inventories required to meet
increased sales demand associated with new product offerings, sales growth, and
increased lead times on certain raw materials; and an increase in accounts
receivable due to sales growth; partially offset by higher current liabilities
associated with increased sales and purchases and higher accrued employee
compensation and related payroll taxes.

Investing Activities

         Net cash used in investing activities during the three fiscal year
period ended October 31, 2008 primarily relates to several acquisitions,
including contingent payments and the acquisitions of certain minority
interests, totaling $135.5 million, including $29.0 million in fiscal 2008,
$48.4 million in fiscal 2007 and $58.1 million in fiscal 2006. Further details
on acquisitions may be found at the beginning of this Item 7 under the caption
"Overview" and Note 2, Acquisitions, of the Notes to Consolidated Financial
Statements. Capital expenditures aggregated $36.3 million over the last three
fiscal years, primarily reflecting the expansion of existing production
facilities and capabilities, which were generally funded using cash provided by
operating activities.

Financing Activities

         During the three fiscal year period ended October 31, 2008, the Company
borrowed an aggregate $155.0 million under its revolving credit facility
principally to fund acquisitions, including $50.0 million in fiscal 2008, $46.0
million in fiscal 2007 and $59.0 million in fiscal 2006. Further details on
acquisitions may be found at the beginning of this Item under the caption
"Overview" and Note 2, Acquisitions, of the Notes to Consolidated Financial
Statements. Repayments on the revolving credit facility aggregated $150.0
million over the last three fiscal years, including $66.0 million in fiscal
2008, $46.0 million in fiscal 2007 and $38.0 million in fiscal 2006. For the
three year fiscal period ended October 31, 2008, the Company received proceeds
from stock option exercises aggregating $14.3 million, made distributions to
minority interest owners aggregating $17.2 million, paid cash dividends
aggregating $6.7 million, paid the matured industrial development revenue bonds
aggregating $2.0 million, and made net repayments of $2.0 million on the
Company's short-term line of credit. Net cash provided by financing activities
also includes the presentation of $4.3 million, $5.3 million and $1.6 million
of excess tax benefit from stock option exercises in fiscal 2008, 2007 and 2006,
respectively.

         In May 2008, the Company amended its revolving credit facility by
entering into a $300 million Second Amended and Restated Revolving Credit
Agreement ("Credit Facility") with a bank syndicate, which matures in May 2013.
Under certain circumstances, the maturity may be extended for two one-year
periods. The Credit Facility also includes a feature that will allow the Company
to increase the Credit Facility, at its option, up to $500 million through
increased commitments from existing lenders or the addition of new lenders. The
Credit Facility may be used for working capital and general corporate

                                       31
<PAGE>

needs of the Company, including letters of credit, capital expenditures and to
finance acquisitions. Advances under the Credit Facility accrue interest at the
Company's choice of the "Base Rate" or the London Interbank Offered Rate
("LIBOR") plus applicable margins (based on the Company's ratio of total funded
debt to earnings before interest, taxes, depreciation and amortization, minority
interest and non-cash charges, or "leverage ratio"). The Base Rate is the higher
of (i) the Prime Rate or (ii) the Federal Funds rate plus .50%. The applicable
margins for LIBOR-based borrowings range from .625% to 2.25%. A fee is charged
on the amount of the unused commitment ranging from .125% to .35% (depending on
the Company's leverage ratio). The Credit Facility also includes a $50 million
sublimit for borrowings made in euros, a $30 million sublimit for letters of
credit and a $20 million swingline sublimit. The Credit Facility is unsecured
and contains covenants that require, among other things, the maintenance of the
leverage ratio, a senior leverage ratio and a fixed charge coverage ratio. In
the event the Company's leverage ratio exceeds a specified level, the Credit
Facility would become secured by the capital stock owned in substantially all of
the Company's subsidiaries. As of October 31, 2008, the Company's leverage
ratio was significantly below such specified level. See Note 5, Short-Term and
Long-Term Debt, of the Notes to Consolidated Financial Statements for further
information regarding the revolving credit facility.

Contractual Obligations

         The following table summarizes the Company's contractual obligations as
of October 31, 2008:

<TABLE>
<CAPTION>
                                                                   Payments due by fiscal period
                                                      -----------------------------------------------------------
                                           Total          2009        2010 - 2011     2012 - 2013      Thereafter
                                        -----------   -----------     -----------     -----------      ----------
<S>                                     <C>           <C>             <C>             <C>              <C>
Short-term and long-term debt
  obligations (1)                       $37,489,000      $162,000        $275,000     $37,052,000             $--
Capital lease obligations
  and equipment loans (1)                   112,000        58,000          54,000              --              --
Operating lease obligations (2)          32,193,000     5,749,000      10,079,000       7,300,000       9,065,000
Purchase obligations (3)(4)(5)            8,960,000     8,758,000         202,000              --              --
Other long-term liabilities (6)(7)          259,000        56,000          99,000          76,000          28,000
                                        -----------   -----------     -----------     -----------      ----------
Total contractual obligations           $79,013,000   $14,783,000     $10,709,000     $44,428,000      $9,093,000
                                        ===========   ===========     ===========     ===========      ==========
</TABLE>

    ----------

(1) Excludes interest charges on borrowings and the fee on the amount of any
    unused commitment that the Company may be obligated to pay under its
    revolving credit facility as such amounts vary. Also excludes interest
    charges associated with notes payable, capital lease obligations and
    equipment loans as such amounts are not material. See Note 5, Short-Term
    and Long-Term Debt, of the Notes to Consolidated Financial Statements and
    "Financing Activities" above for additional information regarding the
    Company's long-term debt and capital lease obligations and equipment
    loans.

(2) See Note 14, Commitments and Contingencies - Lease Commitments, of the
    Notes to Consolidated Financial Statements for additional information
    regarding the Company's operating lease obligations.

(3) Includes an aggregate of $735,000 of commitments for capital expenditures
    as well as purchase obligations of inventory and supplies that extend
    beyond one year. All purchase obligations of inventory and supplies in the
    ordinary course of business (i.e., with deliveries scheduled within the
    next year) are excluded from the table.

(4) Also includes accrued additional contingent purchase consideration of
    $2,197,000 payable in fiscal 2009 relating to a previous year acquisition
    (see Note 2, Acquisitions, of the Notes to Consolidated Financial
    Statements). The amounts in the table do not include the additional
    contingent purchase consideration the

                                       32
<PAGE>

    Company may have to pay based on future earnings of certain acquired
    businesses, which is further discussed in "Off-Balance Sheet Arrangements -
    Acquisitions - Additional Contingent Purchase Consideration" below. The
    maximum amount of such contingent consideration that the Company could be
    required to pay aggregates approximately $82 million payable over the
    future periods beginning in fiscal 2010 through fiscal 2013. Assuming the
    subsidiaries perform over their respective future measurement periods at
    the same earnings levels they performed in the comparable historical
    measurement periods, the aggregate amount of such contingent consideration
    that the Company would be required to pay is approximately $5 million. The
    actual contingent purchase consideration will likely be different.

(5) As further explained below in "Off-Balance Sheet Arrangements -
    Acquisitions - Put/Call Rights," the minority interest holders of certain
    subsidiaries have rights ( "Put Rights") that may be exercised on varying
    dates causing the Company to purchase their equity interests beginning in
    fiscal 2009 through fiscal 2018. The amounts in the table include
    $6,028,000 payable in 2009 (of which $1.2 million was accrued as of October
    31, 2008) pursuant to the exercise of such Put Rights by the minority
    interest holders of three of the Company's subsidiaries. Amounts that may
    be paid in years subsequent to fiscal 2009 have been excluded from the
    table as such amounts are either contingent upon the exercise of Put Rights
    and/or based on a multiple of future earnings, both which are uncertain at
    this time. Assuming the subsidiaries perform over their respective future
    measurement periods at the same earnings levels they performed in the
    comparable historical measurement periods and assuming all Put Rights are
    exercised, the aggregate additional amount that the Company would be
    required to pay is approximately $44 million. The actual amount will likely
    be different. In December 2008, the Company and the minority interest
    holders of one of the Company's subsidiaries agreed to accelerate the
    Company's purchase of a portion of the minority interests from fiscal 2010
    to fiscal 2009 for an estimated purchase price of $4.7 million (see Note
    16, Subsequent Event, of the Notes to Consolidated Financial Statements).
    This amount is not reflected in the table above.

(6) Represents projected payments aggregating $259,000 under the Company's
    Directors Retirement Plan, which is explained further in Note 9, Retirement
    Plans, of the Notes to Consolidated Financial Statements (the plan is
    unfunded and the Company pays benefits directly). The amounts in the table
    do not include amounts related to the Leadership Compensation Plan or the
    Company's other deferred compensation arrangement as there is a related
    asset or an offsetting asset, respectively, included in the Company's
    Consolidated Balance Sheets. See Note 3, Selected Financial Statement
    Information - Other Non-Current Liabilities, of the Notes to Consolidated
    Financial Statements for further information about these two deferred
    compensation plans.

(7) The amounts in the table do not include approximately $5,513,000 of the
    Company's FIN 48 liability for unrecognized tax benefits as it is uncertain
    as to if or when such amounts may be settled with taxing authorities. See
    Note 6, Income Taxes, of the Notes to Consolidated Financial Statements and
    "New Accounting Pronouncements" below for additional information regarding
    the Company's adoption of FIN 48 provisions.

Off-Balance Sheet Arrangements

Guarantees

         The Company has arranged for standby letters of credit aggregating $1.4
million to meet the security requirement of its insurance company for potential
workers' compensation claims, which are supported by the Company's revolving
credit facility.

Acquisitions - Put/Call Rights

         Pursuant to the purchase agreement related to the acquisition of an 80%
interest in a subsidiary by the FSG in fiscal 2001, the Company acquired an
additional 10% of the equity interests of the subsidiary in fiscal 2007. The
Company has provided notice to the minority interest holder that it will
purchase the remaining 10% interest effective October 31, 2008. Accordingly, the
Company accrued $1.2 million as of October 31, 2008 related to the purchase of
this equity interest, which was paid in December 2008.

                                       33
<PAGE>

         As part of the agreement to acquire an 80% interest in a subsidiary by
the ETG in fiscal 2004, the Company has the right to purchase the minority
interests over a five-year period beginning at approximately the tenth
anniversary of the acquisition, or sooner under certain conditions, and the
minority interest holders have the right to cause the Company to purchase their
interests over a five-year period commencing on approximately the fifth
anniversary of the acquisition, or sooner under certain conditions.

         Pursuant to the purchase agreement related to the acquisition of a 85%
interest in a subsidiary by the ETG in fiscal 2005, certain minority interest
holders exercised their option during fiscal 2007 to cause the Company to
purchase their aggregate 3% interest over a four-year period ending in fiscal
2010. Accordingly, the Company increased its ownership interest in the
subsidiary by 1.5% (or one-fourth of such minority interest holders' aggregate
interest in fiscal 2007 and 2008, respectively) to 86.5% effective April 2008.
Further, the remaining minority interest holders currently have the right to
cause the Company to purchase their aggregate 12% interest over a four-year
period.

         Pursuant to the purchase agreement related to the acquisition of a 51%
interest in a subsidiary by the FSG in fiscal 2006, the minority interest
holders exercised their option during fiscal 2008 to cause the Company to
purchase an aggregate 28% interest over a four-year period ending in fiscal
2011. Accordingly, the Company increased its ownership interest in the
subsidiary by 7% (or one-fourth of such minority interest holders' aggregate
interest) to 58% effective April 2008. In December 2008, the Company and the
minority interest holders agreed to accelerate the purchase of 14% of these
equity interests (7% from April 2009 and 7% from April 2010) to December 2008.
The estimated purchase price of this 14% interest is $9.3 million (see Note 16,
Subsequent Event, of the Notes to Consolidated Financial Statements). Further,
the Company has the right to purchase the remaining 21% of the equity interests
of the subsidiary over a three-year period beginning approximately after the
fourth anniversary of the acquisition, or sooner under certain conditions, and
the minority interest holders have the right to cause the Company to purchase
the same equity interest over the same period.

         As part of the agreement to acquire an 80% interest in a subsidiary by
the FSG in fiscal 2006, the Company has the right to purchase the minority
interests over a four-year period beginning at approximately the eighth
anniversary of the acquisition, or sooner under certain conditions, and the
minority interest holders have the right to cause the Company to purchase the
same equity interest over the same period.

         As part of an agreement to acquire an 80% interest in a subsidiary by
the FSG in fiscal 2008, the Company has the right to purchase the minority
interests over a five-year period beginning at approximately the sixth
anniversary of the acquisition, or sooner under certain conditions, and the
minority interest holders have the right to cause the Company to purchase the
same equity interest over the same period.

         The above referenced rights of the minority interest holders ("Put
Rights") may be exercised on varying dates causing the Company to purchase their
equity interests beginning in fiscal 2009 through fiscal 2018. The Put Rights,
all of which relate either to common shares or membership interests in limited
liability companies, provide that the cash consideration to be paid for the
minority interests ("Redemption Amount") be at a formula that management
intended to reasonably approximate fair value, as defined in the applicable
agreements based on a multiple of future earnings over a measurement period.
Upon exercise of any Put Right, the Company's ownership interest in the
subsidiary would increase and minority interest expense would decrease. The Put
Rights are embedded in the shares owned by the minority interest holders and are
not freestanding. Consistent with Accounting Research Bulletin No. 51,
"Consolidated Financial Statements," minority interests have been recorded on
the Company's consolidated balance sheets at historical cost plus an allocation
of subsidiary earnings based on ownership

                                       34
<PAGE>

interests, less dividends paid to the minority interest holders. As described in
Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated
Financial Statements, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 160 in December 2007
that will change the current accounting and financial reporting for non-
controlling (minority) interests. SFAS No. 160 will be effective for fiscal
years beginning after December 15, 2008. The Company will adopt SFAS No. 160 on
November 1, 2009. SFAS No. 160 will require that non-controlling (minority)
interests be reported in the consolidated balance sheet within equity. The
Company is not yet in a position to assess the full impact and related
disclosure of adopting SFAS No. 160 on its minority interest liabilities and
related Put Rights.

Acquisitions - Additional Contingent Purchase Consideration

         As part of the agreement to purchase a subsidiary by the ETG in fiscal
2005, the Company may be obligated to pay additional purchase consideration
currently estimated to total up to $2.7 million should the subsidiary meet
certain product line-related earnings objectives during the fourth and fifth
years following the acquisition.

         As part of the agreement to acquire a subsidiary by the ETG in fiscal
2006, the Company may be obligated to pay additional purchase consideration up
to $19.2 million based on the subsidiary's fiscal 2009 earnings relative to
target.

          As part of the agreement to acquire a subsidiary by the ETG in fiscal
2007, the Company may be obligated to pay additional purchase consideration up
to 73 million Canadian dollars in aggregate, which translates to $59.7 million
U.S. dollars based on the October 31, 2008 exchange rate, should the subsidiary
meet certain earnings objectives during the first five years following the
acquisition.

          As part of the agreement to acquire a subsidiary by the FSG in fiscal
2008, the Company may be obligated to pay additional consideration of up to
approximately $.4 million in aggregate should the subsidiary meet certain
earnings objectives during the third, fourth and fifth years following the
acquisition.

         The above referenced additional contingent purchase consideration will
be accrued when the earnings objectives are met. Such additional contingent
consideration is based on a multiple of earnings above a threshold (subject to a
cap in certain cases) and is not contingent upon the former shareholders of the
acquired entities remaining employed by the Company or providing future services
to the Company. Accordingly, such consideration will be recorded as an
additional cost of the respective acquired entity when paid.

         For additional information on the aforementioned acquisitions see Note
2, Acquisitions, of the Notes to Consolidated Financial Statements.

New Accounting Pronouncements

         Effective November 1, 2007, the Company adopted FASB Interpretation
No. 48 ("FIN 48"), "Accounting for Uncertainty in Income Taxes - an
interpretation of FASB Statement No. 109," and began evaluating tax positions
utilizing a two-step process. The first step is to determine whether it is
more-likely-than-not that a tax position will be sustained upon examination
based on the technical merits of the position. The second step is to measure the
benefit to be recorded from tax positions that meet the more-likely-than-not
recognition threshold by determining the largest amount of tax benefit that is
greater than 50 percent likely of being realized upon ultimate settlement and
recognizing that amount in the financial statements. As a result of adopting the
provisions of FIN 48, the Company recognized a

                                       35
<PAGE>

cumulative effect adjustment that decreased retained earnings as of the
beginning of fiscal 2008 by $639,000. Further, effective with the adoption of
FIN 48, the Company's policy is to recognize interest and penalties related to
income tax matters as a component of income tax expense. Interest and
penalties, which were not significant in fiscal 2007, were previously recorded
in interest expense and in selling, general and administrative expenses,
respectively, in the Company's Consolidated Statements of Operations. Further
information regarding income taxes can be found in Note 6, Income Taxes, of the
Notes to Consolidated Financial Statements.

         In September 2006, the FASB issued SFAS No. 157, "Fair Value
Measurements," which provides enhanced guidance for using fair value to measure
assets and liabilities. SFAS No. 157 provides a common definition of fair value
and establishes a framework to make the measurement of fair value in accordance
with generally accepted accounting principles more consistent and comparable.
SFAS No. 157 also requires expanded disclosures to provide information about the
extent to which fair value is used to measure assets and liabilities, the
methods and assumptions used to measure fair value and the effect of fair value
measures on earnings. SFAS No. 157 is effective for fiscal years beginning after
November 15, 2007, or in fiscal 2009 for HEICO. In February 2008, the FASB
issued FASB Staff Position ("FSP") No. SFAS 157-2, "Effective Date of FASB
Statement No. 157." FSP No. SFAS 157-2 delays the effective date of SFAS No. 157
by one year for nonfinancial assets and nonfinancial liabilities, except for the
items that are recognized or disclosed at fair value in the financial statements
on a recurring basis. The Company is currently in the process of evaluating the
effect, if any, the adoption of SFAS No. 157 will have on its results of
operations, financial position and cash flows.

         In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option
for Financial Assets and Financial Liabilities - Including an amendment of FASB
Statement No. 115." SFAS No. 159 permits entities to choose to measure certain
financial assets and liabilities at fair value and report unrealized gains and
losses on items for which the fair value option has been elected in earnings.
SFAS No. 159 is effective for fiscal years beginning after November 15, 2007, or
in fiscal 2009 for HEICO. The Company has not yet determined if it will elect to
apply any of the provisions of SFAS No. 159 and is currently evaluating the
effect, if any, the adoption of SFAS No. 159 will have on its results of
operations, financial position and cash flows.

         In December 2007, the FASB issued SFAS No. 141(R), "Business
Combinations." SFAS No. 141(R) is a revision of SFAS No. 141 and retains the
fundamental requirements in SFAS 141 that the acquisition method of accounting
(formerly the "purchase accounting" method) be used for all business
combinations and for an acquirer to be identified for each business combination.
However, SFAS No. 141(R) changes the approach of applying the acquisition method
in a number of significant areas, including that acquisition costs will
generally be expensed as incurred; noncontrolling interests will be valued at
fair value at the acquisition date; in-process research and development will be
recorded at fair value as an indefinite-lived intangible asset at the
acquisition date; restructuring costs associated with a business combination
will generally be expensed subsequent to the acquisition date; and changes in
deferred tax asset valuation allowances and income tax uncertainties after the
acquisition date generally will affect income tax expense. SFAS No. 141(R) is
effective on a prospective basis for all business combinations for which the
acquisition date is on or after the beginning of the first fiscal year
subsequent to December 15, 2008, or in fiscal 2010 for HEICO. The Company is in
the process of evaluating the effect the adoption of SFAS No. 141(R) will have
on its results of operations, financial position and cash flows.

         In December 2007, the FASB issued SFAS No. 160, "Noncontrolling
Interests in Consolidated Financial Statements - an amendment of ARB No. 51."
This statement requires the recognition of a noncontrolling interest (previously
referred to as minority interest) as a separate component within equity in the
consolidated balance sheet. It also requires the amount of consolidated net
income attributable to

                                       36
<PAGE>

the parent and the noncontrolling interest be clearly identified and presented
within the consolidated statement of operations. SFAS No. 160 is effective for
fiscal years beginning on or after December 15, 2008, or in fiscal 2010 for
HEICO. The Company is in the process of evaluating the effect the adoption of
SFAS No. 160 will have on its results of operations, financial position and cash
flows.

         In March 2008, the FASB issued SFAS No. 161, "Disclosures about
Derivative Instruments and Hedging Activities - an amendment of FASB Statement
No. 133." SFAS No. 161 expands the disclosure requirements in SFAS No. 133
about an entity's derivative instruments and hedging activities. It requires
enhanced disclosures about (i) how and why an entity uses derivative
instruments; (ii) how derivative instruments and related hedged items are
accounted for under SFAS No. 133 and its related interpretations; and (iii) how
derivative instruments and related hedged items affect an entity's financial
position, financial performance and cash flows. SFAS No. 161 is effective for
fiscal years and interim periods beginning after November 15, 2008, or in the
second quarter of fiscal 2009 for HEICO. The Company is currently in the process
of evaluating the effect the adoption of SFAS No. 161 will have on its financial
statement disclosures.

         In May 2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally
Accepted Accounting Principles." SFAS No. 162 identifies the sources of
accounting principles and the framework for selecting the principles used in the
preparation of financial statements that are presented in conformity with
generally accepted accounting principles. SFAS No. 162 is effective 60 days
following the Securities and Exchange Commission's approval of the Public
Company Accounting Oversight Board amendments to remove the hierarchy of
generally accepted accounting principles from the auditing standards. The
Company is currently in the process of evaluating the effect, if any, the
adoption of SFAS No. 162 will have on its results of operations, financial
position and cash flows.

Forward Looking Statements

         Certain statements in this Report constitute "forward -looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. All statements contained herein that are not clearly historical in
nature may be forward-looking and the words "believe," "expect," "estimate" and
similar expressions are generally intended to identify forward-looking
statements. Any forward-looking statements contained herein, in press releases,
written statements, or other documents filed with the Securities and Exchange
Commission or in communications and discussions with investors and analysts in
the normal course of business through meetings, phone calls and conference
calls, concerning our operations, economic performance and financial condition
are subject to known and unknown risks, uncertainties and contingencies. We have
based these forward-looking statements on our current expectations and
projections about future events. All forward-looking statements involve risks
and uncertainties, many of which are beyond our control, which may cause actual
results, performance or achievements to differ materially from anticipated
results, performance or achievements. Also, forward-looking statements are
based upon management's estimates of fair values and of future costs, using
currently available information. Therefore, actual results may differ materially
from those expressed or implied in those statements. Factors that could cause
such differences include, but are not limited to:

       o Lower demand for commercial air travel or airline fleet changes, which
         could cause lower demand for our goods and services;

       o Product specification costs and requirements, which could cause an
         increase to our costs to complete contracts;

                                       37
<PAGE>

       o Governmental and regulatory demands, export policies and restrictions,
         reductions in defense, space or homeland security spending by U.S.
         and/or foreign customers or competition from existing and new
         competitors, which could reduce our sales;

       o HEICO's ability to introduce new products and product pricing levels,
         which could reduce our sales or sales growth;

       o HEICO's ability to make acquisitions and achieve operating synergies
         from acquired businesses, customer credit risk, interest rates and
         economic conditions within and outside of the aviation, defense, space
         and electronics industries, which could negatively impact our costs and
         revenues; and

       o HEICO's ability to maintain effective internal controls, which could
         adversely affect our business and the market price of our common stock.

         We undertake no obligation to publicly update or revise any forward-
looking statement, whether as a result of new information, future events or
otherwise.

                                       38
<PAGE>

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The primary market risk to which the Company has exposure is interest
rate risk, mainly related to its revolving credit facility, which has variable
interest rates. Interest rate risk associated with the Company's variable rate
debt is the potential increase in interest expense from an increase in interest
rates. Periodically, the Company enters into interest rate swap agreements to
manage its interest expense. The Company did not have any interest rate swap
agreements in effect as of October 31, 2008. Based on the Company's aggregate
outstanding variable rate debt balance of $37 million as of October 31, 2008, a
hypothetical 10% increase in interest rates would increase the Company's
interest expense by approximately $133,000 in fiscal 2008.

         The Company maintains a portion of its cash and cash equivalents in
financial instruments with original maturities of three months or less. These
financial instruments are subject to interest rate risk and will decline in
value if interest rates increase. Due to the short duration of these financial
instruments, a hypothetical 10% increase in interest rates as of October 31,
2008 would not have a material effect on the Company's results of operations,
financial position or cash flows.

         The Company is also exposed to foreign currency exchange rate
fluctuations on the United States dollar value of its foreign currency
denominated transactions, which are principally in Canadian dollar and British
pound sterling. During fiscal 2008, the Company entered into a foreign currency
forward contract to mitigate a portion of foreign exchange risk at one of its
foreign subsidiaries for transactions denominated in a currency other than its
functional currency. The impact of this forward contract did not have a material
effect on the Company's results of operations, financial position or cash flows.
A hypothetical 10% weakening in the exchange rate of the Canadian dollar or
British pound sterling to the United States dollar as of October 31, 2008 would
not have a material effect on the Company's results of operations, financial
position or cash flows.

                                       39
<PAGE>

Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                       HEICO CORPORATION AND SUBSIDIARIES
                          INDEX TO FINANCIAL STATEMENTS

                                                                            Page
                                                                            ----
Report of Independent Registered Public Accounting Firm .................... 41

Consolidated Balance Sheets as of October 31, 2008 and 2007 ................ 43

Consolidated Statements of Operations for the years ended
   October 31, 2008, 2007 and 2006 ......................................... 44

Consolidated Statements of Shareholders' Equity and Comprehensive Income
   for the years ended October 31, 2008, 2007 and 2006 ..................... 45

Consolidated Statements of Cash Flows for the years ended
   October 31, 2008, 2007 and 2006 ......................................... 46

Notes to Consolidated Financial Statements ................................. 47

                                       40
<PAGE>

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of
HEICO Corporation
Hollywood, Florida

We have audited the accompanying consolidated balance sheets of HEICO
Corporation and subsidiaries (the "Company") as of October 31, 2008 and 2007,
and the related consolidated statements of operations, shareholders' equity and
comprehensive income, and cash flows for each of the three years in the period
ended October 31, 2008. Our audits also included the financial statement
schedule listed in the Index at Item 15. We have also audited the Company's
internal control over financial reporting as of October 31, 2008, based on
criteria established in Internal Control--Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission. The Company's
management is responsible for these financial statements and the financial
statement schedule, for maintaining effective internal control over financial
reporting, and for its assessment of the effectiveness of internal control over
financial reporting, included in the accompanying Management's Report on
Internal Control over Financial Reporting. Our responsibility is to express an
opinion on these financial statements and the financial statement schedule and
an opinion on the Company's internal control over financial reporting based on
our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement and whether effective
internal control over financial reporting was maintained in all material
respects. Our audits of the financial statements included examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
Our audit of internal control over financial reporting included obtaining an
understanding of internal control over financial reporting, assessing the risk
that a material weakness exists, testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our audits also
included performing such other procedures as we considered necessary in the
circumstances. We believe that our audits provide a reasonable basis for our
opinions.

A company's internal control over financial reporting is a process designed by,
or under the supervision of, the company's principal executive and principal
financial officers, or persons performing similar functions, and effected by the
company's board of directors, management, and other personnel to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A company's internal control over
financial reporting includes those policies and procedures that (1) pertain to
the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of the company; (2)
provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted
accounting principles and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors
of the company; and (3) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of the
company's assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial
reporting, including the possibility of collusion or improper management
override of controls, material misstatements due to error or fraud may not be
prevented or detected on a timely basis. Also, projections of any evaluation of
the effectiveness of the internal control over financial reporting to future
periods are subject to the risk that the controls may

                                       41
<PAGE>

become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of HEICO Corporation
and subsidiaries as of October 31, 2008 and 2007, and the results of their
operations and their cash flows for each of the three years in the period ended
October 31, 2008, in conformity with accounting principles generally accepted in
the United States of America. Also, in our opinion, such financial statement
schedule, when considered in relation to the basic consolidated financial
statements taken as a whole, presents fairly, in all material respects, the
information set forth therein. Also, in our opinion, the Company maintained, in
all material respects, effective internal control over financial reporting as
of October 31, 2008, based on the criteria established in Internal
Control--Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission.

DELOITTE & TOUCHE LLP
Certified Public Accountants

Miami, Florida
December 24, 2008

                                       42
<PAGE>

                              HEICO CORPORATION AND SUBSIDIARIES
                                 CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                      As of October 31,
                                                                               -------------------------------
                                                                                   2008               2007
                                                                               ------------       ------------
<S>                                                                            <C>                <C>
                                               ASSETS
Current assets:
  Cash and cash equivalents                                                     $12,562,000         $4,947,000
  Accounts receivable, net                                                       88,403,000         82,399,000
  Inventories, net                                                              132,910,000        115,770,000
  Prepaid expenses and other current assets                                       3,678,000          4,557,000
  Deferred income taxes                                                          13,957,000         10,135,000
                                                                               ------------       ------------
    Total current assets                                                        251,510,000        217,808,000

Property, plant and equipment, net                                               59,966,000         55,554,000
Goodwill                                                                        323,393,000        310,502,000
Intangible assets, net                                                           24,983,000         35,333,000
Other assets                                                                     16,690,000         12,105,000
                                                                               ------------       ------------
    Total assets                                                               $676,542,000       $631,302,000
                                                                               ============       ============

                                   LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Current maturities of long-term debt                                             $220,000         $2,187,000
  Trade accounts payable                                                         29,657,000         28,161,000
  Accrued expenses and other current liabilities                                 49,586,000         53,878,000
  Income taxes payable                                                            1,765,000          3,112,000
                                                                               ------------       ------------
    Total current liabilities                                                    81,228,000         87,338,000

Long-term debt, net of current maturities                                        37,381,000         53,765,000
Deferred income taxes                                                            39,192,000         35,296,000
Other non-current liabilities                                                    17,003,000         10,364,000
                                                                               ------------       ------------
    Total liabilities                                                           174,804,000        186,763,000
                                                                               ------------       ------------
Minority interests in consolidated subsidiaries (Note 14)                        83,978,000         72,938,000
                                                                               ------------       ------------

Commitments and contingencies (Notes 2 and 14)
Shareholders' equity:
  Preferred Stock, $.01 par value per share; 10,000,000 shares authorized;
    300,000 shares designated as Series B Junior Participating Preferred Stock
    and 300,000 shares designated as Series C Junior Participating Preferred
    Stock; none issued                                                                   --                 --
  Common Stock, $.01 par value par share; 30,000,000 shares authorized;
    10,572,641 and 10,538,691 shares issued and outstanding, respectively           106,000            105,000
  Class A Common Stock, $.01 par value per share; 30,000,000 shares
    authorized; 15,829,790 and 15,612,862 shares issued and
    outstanding, respectively                                                       158,000            156,000
  Capital in excess of par value                                                229,443,000        220,658,000
  Accumulated other comprehensive (loss) income                                  (4,819,000)         3,050,000
  Retained earnings                                                             192,872,000        147,632,000
                                                                               ------------       ------------
    Total shareholders' equity                                                  417,760,000        371,601,000
                                                                               ------------       ------------
    Total liabilities and shareholders' equity                                 $676,542,000       $631,302,000
                                                                               ============       ============
</TABLE>

        The accompanying notes are an integral part of these consolidated
                              financial statements.

                                       43
<PAGE>

                       HEICO CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                          For the year ended October 31,
                                                            ------------------------------------------------------
                                                                2008               2007                  2006
                                                            ------------        ------------          ------------
<S>                                                         <C>                 <C>                   <C>
Net sales                                                   $582,347,000        $507,924,000          $392,190,000
                                                            ------------        ------------          ------------
Operating costs and expenses:
     Cost of sales                                           371,852,000         330,466,000           249,677,000
     Selling, general and administrative expenses            104,707,000          91,444,000            75,646,000
                                                            ------------        ------------          ------------

Total operating costs and expenses                           476,559,000         421,910,000           325,323,000
                                                            ------------        ------------          ------------

Operating income                                             105,788,000          86,014,000            66,867,000

Interest expense                                              (2,314,000)         (3,293,000)           (3,523,000)
Interest and other (expense) income                             (637,000)             95,000               639,000
                                                            ------------        ------------          ------------

Income before income taxes and minority interests            102,837,000          82,816,000            63,983,000

Income tax expense                                            35,450,000          27,530,000            20,900,000
                                                            ------------        ------------          ------------

Income before minority interests                              67,387,000          55,286,000            43,083,000

Minority interests' share of income                           18,876,000          16,281,000            11,195,000
                                                            ------------        ------------          ------------

Net income                                                   $48,511,000         $39,005,000           $31,888,000
                                                            ============        ============          ============

Net income per share:
     Basic                                                         $1.84               $1.52                 $1.27
     Diluted                                                       $1.78               $1.45                 $1.20

Weighted average number of common shares outstanding:
     Basic                                                    26,309,139          25,715,899            25,084,532
     Diluted                                                  27,243,356          26,931,048            26,597,603
</TABLE>

        The accompanying notes are an integral part of these consolidated
                              financial statements.

                                       44
<PAGE>

                       HEICO CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME

<TABLE>
<CAPTION>
                                                                                    Accumulated
                                                          Class A    Capital in        Other
                                              Common       Common     Excess of     Comprehensive      Retained      Comprehensive
                                               Stock       Stock      Par Value     (Loss) Income      Earnings         Income
                                              --------    --------   ------------   --------------    ------------   --------------
<S>                                           <C>         <C>        <C>               <C>            <C>               <C>
Balances as of October 31, 2005               $101,000    $145,000   $192,523,000         ($65,000)    $80,799,000
Net income                                          --          --             --               --      31,888,000      $31,888,000
Foreign currency translation adjustments            --          --             --          127,000              --          127,000
                                                                                                                      -------------
Comprehensive income                                --          --             --               --              --      $32,015,000
                                                                                                                      =============
Cash dividends ($.08 per share)                     --          --             --               --      (2,004,000)
Tax benefit from stock option exercises             --          --      7,300,000               --              --
Proceeds from stock option exercises             2,000       6,000      5,063,000               --              --
Stock option compensation expense                   --          --      1,373,000               --              --
Other                                               --          --          1,000               --          (1,000)
                                              --------    --------   ------------   --------------    ------------
Balances as of October 31, 2006                103,000     151,000    206,260,000           62,000     110,682,000
Net income                                          --          --             --               --      39,005,000      $39,005,000
Foreign currency translation adjustments            --          --             --        2,966,000              --        2,966,000
                                                                                                                      -------------
Comprehensive income                                --          --             --               --              --      $41,971,000
                                                                                                                      =============
Cash dividends ($.08 per share)                     --          --             --               --      (2,056,000)
Tax benefit from stock option exercises             --          --      6,873,000               --              --
Proceeds from stock option exercises             2,000       5,000      6,868,000               --              --
Stock option compensation expense                   --          --        658,000               --              --
Other                                               --          --         (1,000)          22,000           1,000
                                              --------    --------   ------------   --------------    ------------
Balances as of October 31, 2007                105,000     156,000    220,658,000        3,050,000     147,632,000
Net income                                          --          --             --               --      48,511,000      $48,511,000
Foreign currency translation adjustments            --          --             --       (7,706,000)             --       (7,706,000)
                                                                                                                      -------------
Comprehensive income                                --          --             --               --              --      $40,805,000
                                                                                                                      =============
Cash dividends ($.10 per share)                     --          --             --               --      (2,631,000)
Cumulative effect of adopting FIN 48 (Note 6)       --          --             --               --        (639,000)
Tax benefit from stock option exercises             --          --      6,248,000               --              --
Proceeds from stock option exercises             1,000       2,000      2,395,000               --              --
Stock option compensation expense                   --          --        142,000               --              --
Other                                               --          --             --         (163,000)         (1,000)
                                              --------    --------   ------------   --------------    ------------
Balances as of October 31, 2008               $106,000    $158,000   $229,443,000      ($4,819,000)   $192,872,000
                                              ========    ========   ============   ==============    ============
</TABLE>

        The accompanying notes are an integral part of these consolidated
                              financial statements.

                                       45
<PAGE>

                       HEICO CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                     For the year ended October 31,
                                                                               -----------------------------------------
                                                                                  2008           2007           2006
                                                                               -----------    -----------    -----------
<S>                                                                            <C>            <C>            <C>
Operating Activities:
 Net income                                                                    $48,511,000    $39,005,000    $31,888,000
 Adjustments to reconcile net income to net cash provided by
   operating activities:
        Depreciation and amortization                                           15,052,000     12,167,000     10,565,000
        Impairment of intangible assets                                          1,835,000             --             --
        Deferred income tax provision                                            3,617,000      2,819,000      2,557,000
        Minority interests' share of income                                     18,876,000     16,281,000     11,195,000
        Tax benefit from stock option exercises                                  6,248,000      6,873,000      2,210,000
        Excess tax benefit from stock option exercises                          (4,324,000)    (5,262,000)    (1,550,000)
        Stock option compensation expense                                          142,000        658,000      1,373,000
        Changes in assets and liabilities, net of acquisitions:
            Increase in accounts receivable                                     (4,749,000)   (13,790,000)    (5,018,000)
            Increase in inventories                                            (16,597,000)   (14,701,000)   (13,148,000)
            Decrease (increase) in prepaid expenses and other current assets       650,000       (266,000)       431,000
            Increase in trade accounts payable                                     808,000      4,265,000      3,696,000
            Increase in accrued expenses and other current liabilities           3,803,000      7,013,000      1,698,000
            (Decrease) increase in income taxes payable                         (1,040,000)     1,523,000        362,000
        Other                                                                      330,000        865,000        649,000
                                                                               -----------    -----------    -----------
 Net cash provided by operating activities                                      73,162,000     57,450,000     46,908,000
                                                                               -----------    -----------    -----------

Investing Activities:
  Acquisitions and related costs, net of cash acquired                         (29,038,000)   (48,367,000)   (58,117,000)
  Capital expenditures                                                         (13,455,000)   (12,886,000)    (9,964,000)
  Other                                                                            166,000         59,000        520,000
                                                                               -----------    -----------    -----------
  Net cash used in investing activities                                        (42,327,000)   (61,194,000)   (67,561,000)
                                                                               -----------    -----------    -----------

Financing Activities:
  Payments on revolving credit facility                                        (66,000,000)   (46,000,000)   (38,000,000)
  Borrowings on revolving credit facility                                       50,000,000     46,000,000     59,000,000
  Payments on short-term line of credit                                           (500,000)    (1,000,000)    (3,000,000)
  Borrowings on short-term line of credit                                          500,000      1,000,000      1,000,000
  Payment of industrial development revenue bonds                               (1,980,000)            --             --
  Distributions to minority interest owners                                     (7,456,000)    (6,448,000)    (3,306,000)
  Cash dividends paid                                                           (2,631,000)    (2,056,000)    (2,004,000)
  Proceeds from stock option exercises                                           2,398,000      6,875,000      5,071,000
  Excess tax benefit from stock option exercises                                 4,324,000      5,262,000      1,550,000
  Other                                                                         (1,158,000)       (57,000)       (26,000)
                                                                               -----------    -----------    -----------
  Net cash (used in) provided by financing activities                          (22,503,000)     3,576,000     20,285,000
                                                                               -----------    -----------    -----------

Effect of exchange rate changes on cash                                           (717,000)       116,000         37,000
                                                                               -----------    -----------    -----------
Net increase (decrease) in cash and cash equivalents                             7,615,000        (52,000)      (331,000)
Cash and cash equivalents at beginning of year                                   4,947,000      4,999,000      5,330,000
                                                                               -----------    -----------    -----------
Cash and cash equivalents at end of year                                       $12,562,000     $4,947,000     $4,999,000
                                                                               ===========    ===========    ===========
</TABLE>

        The accompanying notes are an integral part of these consolidated
                              financial statements.

                                       46
<PAGE>

                       HEICO CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

         HEICO Corporation, through its principal subsidiaries HEICO Aerospace
Holdings Corp. ("HEICO Aerospace") and HEICO Electronic Technologies Corp.
("HEICO Electronic") and their subsidiaries (collectively, the "Company"), is
principally engaged in the design, manufacture and sale of aerospace, defense
and electronics related products and services throughout the United States and
internationally. The Company's customer base is primarily the commercial
aviation, defense, space and electronics industries.

Basis of Presentation

         The consolidated financial statements include the accounts of HEICO
Corporation and its subsidiaries, all of which are wholly-owned except for
HEICO Aerospace, which is 20%-owned by Lufthansa Technik AG, the technical
services subsidiary of Lufthansa German Airlines. In addition, HEICO Aerospace
consolidates a joint venture formed in March 2001, which is 16%-owned by
American Airlines' parent company, AMR Corporation, a 58%-owned subsidiary, two
80%-owned subsidiaries and a 90%-owned subsidiary. Also, HEICO Electronic
consolidates two subsidiaries, which are 80% and 86.5% owned, respectively. (See
Note 2, Acquisitions, of the Notes to Consolidated Financial Statements.) All
significant intercompany balances and transactions are eliminated.

Use of Estimates

         The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities as
of the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

Cash and Cash Equivalents

         For purposes of the consolidated financial statements, the Company
considers all highly liquid investments such as U.S. Treasury bills and money
market funds with an original maturity of three months or less to be cash
equivalents.

Accounts Receivable

         Accounts receivable consist of amounts billed and currently due from
customers and unbilled costs and estimated earnings related to revenues from
certain fixed price contracts recognized on the percentage-of-completion method
that have been recognized for accounting purposes, but not yet billed to
customers. The valuation of accounts receivable requires that the Company set up
an allowance for estimated uncollectible accounts and record a corresponding
charge to bad debt expense. The Company estimates uncollectible receivables
based on such factors as its prior experience, its appraisal of a customer's
ability to pay and economic conditions within and outside of the aviation,
defense, space and electronics industries.

                                       47
<PAGE>

Inventory

         Inventory is stated at the lower of cost or market, with cost being
determined on the first-in, first-out or the average cost basis. Losses, if
any, are recognized fully in the period when identified.

         The Company periodically evaluates the carrying value of inventory,
giving consideration to factors such as its physical condition, sales patterns
and expected future demand and estimates the amount necessary to write-down its
slow moving, obsolete or damaged inventory. These estimates could vary
significantly from actual amounts based upon future economic conditions,
customer inventory levels or competitive factors that were not foreseen or did
not exist when the estimated write-downs were made.

Property, Plant and Equipment

         Property, plant and equipment is stated at cost. Depreciation and
amortization is provided mainly on the straight-line method over the estimated
useful lives of the various assets. The Company's property, plant and equipment
is depreciated over the following estimated useful lives:

         Buildings and improvements ...................... 15 to 40 years
         Leasehold improvements ..........................  2 to 20 years
         Machinery and equipment .........................  3 to 10 years
         Tooling .........................................   2 to 5 years

         The costs of major additions and improvements are capitalized.
Leasehold improvements are amortized over the shorter of the leasehold
improvement's useful life or the lease term. Repairs and maintenance are charged
to operations as incurred. Upon disposition, the cost and related accumulated
depreciation are removed from the accounts and any related gain or loss is
reflected in earnings.

Purchase Accounting

         The Company applies the purchase method of accounting to its
acquisitions. Under this method, the purchase price, including any capitalized
acquisition costs, is allocated to the underlying tangible and identifiable
intangible assets acquired and liabilities assumed based on their estimated fair
market values, with any excess recorded as goodwill.

Goodwill and Other Intangible Assets

         The Company tests goodwill for impairment annually as of October 31, or
more frequently if events or changes in circumstances indicate that the carrying
amount of goodwill may not be fully recoverable. The test requires the Company
to compare the fair value of each of its reporting units to its carrying value
to determine potential impairment. If the carrying value of a reporting unit
exceeds its fair value, the implied fair value of that reporting unit's goodwill
is to be calculated and an impairment loss is recognized in the amount by which
the carrying value of a reporting unit's goodwill exceeds its implied fair
value, if any.

         The Company's intangible assets not subject to amortization consist of
trade names. The Company's intangible assets subject to amortization are
amortized on the straight-line method over the following estimated useful lives:

         Customer relationships...........................   3 to 8 years
         Intellectual property ...........................  4 to 15 years
         Licenses ........................................ 12 to 17 years
         Non-compete agreements...........................   2 to 7 years
         Patents .........................................  5 to 20 years

                                       48
<PAGE>

         The Company tests each non-amortizing intangible asset for impairment
annually as of October 31, or more frequently if events or changes in
circumstances indicate that the asset might be impaired. The Company also tests
each amortizing intangible asset for impairment if events or circumstances
indicate that the asset might be impaired. These tests consist of determining
whether the carrying value of such assets will be recovered through undiscounted
expected future cash flows. If the total of the undiscounted future cash flows
is less than the carrying amount of those assets, the Company recognizes an
impairment loss based on the excess of the carrying amount over the fair value
of the assets.

Financial Instruments

         The carrying amounts of cash and cash equivalents, accounts receivable,
trade accounts payable and accrued expenses and other current liabilities
approximate fair value due to the relatively short maturity of the respective
instruments. The carrying value of long-term debt approximates fair market
value due to its variable interest rates.

         Financial instruments which potentially subject the Company to
concentrations of credit risk consist principally of temporary cash investments
and trade receivables. The Company places its temporary cash investments with
high credit quality financial institutions and limits the amount of credit
exposure to any one financial institution. Concentrations of credit risk with
respect to trade receivables are limited due to the large number of customers
comprising the Company's customer base and their dispersion across many
different geographical regions.

         Investments are stated at fair value based on quoted market prices.
Investments that are intended to be held for less than one year are included
within prepaid expenses and other current assets in the Company's Consolidated
Balance Sheets, while those intended to be held for longer than one year are
classified as non-current within other assets. Unrealized gains or losses
associated with available-for-sale securities are reported net of tax within
other comprehensive income in shareholders' equity. Unrealized gains or losses
associated with trading securities are recorded as a component of other income
in the Company's Consolidated Statement of Operations.

Derivative Instruments

         The Company utilizes certain derivative instruments (e.g. interest rate
swap agreements and foreign currency forward contracts) to hedge the variability
of expected future cash flows of certain transactions. On an ongoing basis, the
Company assesses whether derivative instruments used in hedging transactions are
highly effective in offsetting changes in cash flows of the hedged items and
therefore qualify as cash flow hedges. For a derivative instrument that
qualifies as a cash flow hedge, the effective portion of changes in fair value
of the derivative is deferred and recorded as a component of other comprehensive
income until the hedged transaction occurs and is recognized in earnings. All
other portions of changes in the fair value of a cash flow hedge are recognized
in earnings immediately.

         The Company has previously utilized interest rate swap agreements to
manage interest expense related to its revolving credit facility. Interest rate
risk associated with the Company's variable rate revolving credit facility is
the potential increase in interest expense from an increase in interest rates.
The Company did not enter into any interest rate swap agreements in fiscal 2008,
2007, or 2006.

         During fiscal 2008, the Company entered into a foreign currency forward
contract to mitigate foreign exchange risk at one of its foreign subsidiaries
for transactions denominated in a currency other than its functional currency.
The impact of this forward contract did not have a material effect on the
Company's results of operations, financial position or cash flows. The Company
did not enter into any foreign currency forward contracts in fiscal 2007 or
2006.

                                       49
<PAGE>

Customer Rebates and Credits

         The Company records accrued customer rebates and credits as a
component of accrued expenses and other current liabilities in the Company's
Consolidated Balance Sheets. These amounts generally relate to discounts
negotiated with customers as part of certain sales contracts that are usually
tied to sales volume thresholds. The Company accrues customer rebates and
credits as a reduction within net sales as the revenue is recognized based on
the estimated level of discount rate expected to be earned by each customer over
the life of the contract period (generally one year). Accrued customer rebates
and credits are monitored by management and discount levels are updated at least
quarterly.

Product Warranties

         Product warranty liabilities are estimated at the time of shipment and
recorded as a component of accrued expenses and other current liabilities in
the Company's Consolidated Balance Sheets. The amount recognized is based on
historical claims experience.

Revenue Recognition

         Revenue is recognized on an accrual basis, primarily upon the shipment
of products and the rendering of services. Revenues earned from rendering
services represented less than 10% of consolidated net sales for all periods
presented. Revenue from certain fixed price contracts for which costs can be
dependably estimated is recognized on the percentage-of-completion method,
measured by the percentage of costs incurred to date to estimated total costs
for each contract. The percentage of the Company's net sales recognized under
the percentage-of-completion method was approximately 3%, 3%, and 4% in fiscal
2008, 2007 and 2006, respectively. Contract costs include all direct material
and labor costs and those indirect costs related to contract performance, such
as indirect labor, supplies, tools, repairs and depreciation costs. Selling,
general and administrative costs are charged to expense as incurred.

         Revisions in cost estimates as contracts progress have the effect of
increasing or decreasing profits in the period of revision. Provisions for
estimated losses on uncompleted contracts are made in the period in which such
losses are determined. Variations in actual labor performance, changes to
estimated profitability, and final contract settlements may result in revisions
to cost estimates and are recognized in income in the period in which the
revisions are determined.

         The asset, "costs and estimated earnings in excess of billings" on
uncompleted percentage-of-completion contracts, included in accounts
receivable, represents revenues recognized in excess of amounts billed. The
liability, "billings in excess of costs and estimated earnings," included in
accrued expenses and other current liabilities, represents billings in excess of
revenues recognized on contracts accounted for under either the
percentage-of-completion method or the completed-contract method. Billings are
made based on the completion of certain milestones as provided for in the
contracts.

         For fixed price contracts in which costs cannot be dependably
estimated, revenue is recognized on the completed-contract method. A contract is
considered complete when all significant costs have been incurred or the item
has been accepted by the customer. The aggregate effects of changes in estimates
relating to long-term contracts did not have a significant effect on net income
or diluted net income per share in fiscal 2008, 2007 or 2006.

                                       50
<PAGE>

Stock Based Compensation

         The Company records compensation expense associated with stock options
in its Consolidated Statements of Operations based on the grant date fair value
of those awards. The Company generally recognizes stock option compensation
expense ratably over the award's vesting period. The Company calculates the
amount of excess tax benefit that is available to offset future write-offs of
deferred tax assets, or additional paid-in-capital pool ("APIC Pool") by
tracking each stock option award granted after November 1, 1996 on an
employee-by-employee basis and on a grant-by-grant basis to determine whether
there is a tax benefit situation or tax deficiency situation for each such
award. The Company then compares the fair value expense to the tax deduction
received for each stock option grant and aggregates the benefits and
deficiencies, which have the effect of increasing or decreasing, respectively,
the APIC Pool. Should the amount of future tax deficiencies be greater than the
available APIC Pool, the Company will record the excess as income tax expense in
its Consolidated Statements of Operations.

Income Taxes

         Income tax expense includes United States and foreign income taxes,
plus the provision for United States taxes on undistributed earnings of foreign
subsidiaries not deemed to be permanently invested. Deferred income taxes are
provided on elements of income that are recognized for financial accounting
purposes in periods different from periods recognized for income tax purposes.

         Effective November 1, 2007, the Company adopted Financial Accounting
Standards Board ("FASB") Interpretation No. 48 ("FIN 48"), "Accounting for
Uncertainty in Income Taxes -- an interpretation of FASB Statement No. 109," and
began evaluating tax positions utilizing a two-step process. The first step is
to determine whether it is more-likely-than-not that a tax position will be
sustained upon examination based on the technical merits of the position. The
second step is to measure the benefit to be recorded from tax positions that
meet the more-likely-than-not recognition threshold by determining the largest
amount of tax benefit that is greater than 50 percent likely of being realized
upon ultimate settlement and recognizing that amount in the financial
statements. As a result of adopting the provisions of FIN 48, the Company
recognized a cumulative effect adjustment that decreased retained earnings as of
the beginning of fiscal 2008 by $639,000. Further, effective with the adoption
of FIN 48, the Company's policy is to recognize interest and penalties related
to income tax matters as a component of income tax expense. Interest and
penalties, which were not significant in fiscal 2007 and 2006, were previously
recorded in interest expense and in selling, general and administrative
expenses, respectively, in the Company's Consolidated Statements of Operations.
Further information regarding income taxes can be found in Note 6, Income Taxes,
of the Notes to Consolidated Financial Statements.

Net Income Per Share

         Basic net income per share is computed by dividing net income by the
weighted average number of common shares outstanding during the period. Diluted
net income per share is computed by dividing net income by the weighted average
number of common shares outstanding during the period plus potentially dilutive
common shares arising from the assumed exercise of stock options, if dilutive.
The dilutive impact of potentially dilutive common shares is determined by
applying the treasury stock method.

Foreign Currency Translation

         All assets and liabilities of foreign subsidiaries that do not utilize
the United States dollar as its functional currency are translated at period-end
exchange rates, while revenues and expenses are

                                       51
<PAGE>

translated using average exchange rates for the period. Unrealized translation
gains or losses are reported as foreign currency translation adjustments through
other comprehensive income in share holders' equity.

Contingencies

         Losses for contingencies such as product warranties, litigation and
environmental matters are recognized in income when they are probable and can be
reasonably estimated. Gain contingencies are not recognized in income until
they have been realized.

New Accounting Pronouncements

         In September 2006, the FASB issued Statement of Financial Accounting
Standards ("SFAS") No. 157, "Fair Value Measurements," which provides enhanced
guidance for using fair value to measure assets and liabilities. SFAS No. 157
provides a common definition of fair value and establishes a framework to make
the measurement of fair value in accordance with generally accepted accounting
principles more consistent and comparable. SFAS No. 157 also requires expanded
disclosures to provide information about the extent to which fair value is used
to measure assets and liabilities, the methods and assumptions used to measure
fair value and the effect of fair value measures on earnings. SFAS No. 157 is
effective for fiscal years beginning after November 15, 2007, or in fiscal 2009
for HEICO. In February 2008, the FASB issued FASB Staff Position ("FSP") No.
SFAS 157-2, "Effective Date of FASB Statement No. 157." FSP No. SFAS 157-2
delays the effective date of SFAS No. 157 by one year for nonfinancial assets
and nonfinancial liabilities, except for the items that are recognized or
disclosed at fair value in the financial statements on a recurring basis. The
Company is currently in the process of evaluating the effect, if any, the
adoption of SFAS No. 157 will have on its results of operations, financial
position and cash flows.

         In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option
for Financial Assets and Financial Liabilities - Including an amendment of FASB
Statement No. 115." SFAS No. 159 permits entities to choose to measure certain
financial assets and liabilities at fair value and report unrealized gains and
losses on items for which the fair value option has been elected in earnings.
SFAS No. 159 is effective for fiscal years beginning after November 15, 2007, or
in fiscal 2009 for HEICO. The Company has not yet determined if it will elect to
apply any of the provisions of SFAS No. 159 and is currently evaluating the
effect, if any, the adoption of SFAS No. 159 will have on its results of
operations, financial position and cash flows.

         In December 2007, the FASB issued SFAS No. 141(R), "Business
Combinations." SFAS No. 141(R) is a revision of SFAS No. 141 and retains the
fundamental requirements in SFAS 141 that the acquisition method of accounting
(formerly the "purchase accounting" method) be used for all business
combinations and for an acquirer to be identified for each business combination.
However, SFAS No. 141(R) changes the approach of applying the acquisition method
in a number of significant areas, including that acquisition costs will
generally be expensed as incurred; noncontrolling interests will be valued at
fair value at the acquisition date; in-process research and development will be
recorded at fair value as an indefinite-lived intangible asset at the
acquisition date; restructuring costs associated with a business combination
will generally be expensed subsequent to the acquisition date; and changes in
deferred tax asset valuation allowances and income tax uncertainties after the
acquisition date generally will affect income tax expense. SFAS No. 141(R) is
effective on a prospective basis for all business combinations for which the
acquisition date is on or after the beginning of the first fiscal year
subsequent to December 15, 2008, or in fiscal 2010 for HEICO. The Company is in
the process of evaluating the effect the adoption of SFAS No. 141(R) will have
on its results of operations, financial position and cash flows.

                                       52
<PAGE>

         In December 2007, the FASB issued SFAS No. 160, "Noncontrolling
Interests in Consolidated Financial Statements - an amendment of ARB No. 51."
This statement requires the recognition of a noncontrolling interest (previously
referred to as minority interest) as a separate component within equity in the
consolidated balance sheet. It also requires the amount of consolidated net
income attributable to the parent and the noncontrolling interest be clearly
identified and presented within the consolidated statement of operations. SFAS
No. 160 is effective for fiscal years beginning on or after December 15, 2008,
or in fiscal 2010 for HEICO. The Company is in the process of evaluating the
effect the adoption of SFAS No. 160 will have on its results of operations,
financial position and cash flows.

         In March 2008, the FASB issued SFAS No. 161, "Disclosures about
Derivative Instruments and Hedging Activities - an amendment of FASB Statement
No. 133." SFAS No. 161 expands the disclosure requirements in SFAS No. 133 about
an entity's derivative instruments and hedging activities. It requires enhanced
disclosures about (i) how and why an entity uses derivative instruments; (ii)
how derivative instruments and related hedged items are accounted for under SFAS
No. 133 and its related interpretations; and (iii) how derivative instruments
and related hedged items affect an entity's financial position, financial
performance and cash flows. SFAS No. 161 is effective for fiscal years and
interim periods beginning after November 15, 2008, or in the second quarter of
fiscal 2009 for HEICO. The Company is currently in the process of evaluating the
effect the adoption of SFAS No. 161 will have on its financial statement
disclosures.

         In May 2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally
Accepted Accounting Principles." SFAS No. 162 identifies the sources of
accounting principles and the framework for selecting the principles used in the
preparation of financial statements that are presented in conformity with
generally accepted accounting principles. SFAS No. 162 is effective 60 days
following the Securities and Exchange Commission's approval of the Public
Company Accounting Oversight Board amendments to remove the hierarchy of
generally accepted accounting principles from the auditing standards. The
Company is currently in the process of evaluating the effect, if any, the
adoption of SFAS No. 162 will have on its results of operations, financial
position and cash flows.

2. ACQUISITIONS

         In November 2005, the Company, through HEICO Aerospace, acquired a 51%
interest in Seal Dynamics LLC ("Seal LLC") with the remaining 49% interest held
principally by a member of Seal LLC's management group. During fiscal 2008, the
minority interest holders exercised their option to cause the Company to
purchase an aggregate 28% interest over the four-year period ending in fiscal
2011. Accordingly, the Company increased its ownership interest in the
subsidiary by 7% (or one-fourth of such minority interest holders' aggregate
interest) to 58% effective April 2008. Further, the Company has the right to
purchase the remaining 21% of the equity interests of the subsidiary over a
three-year period beginning approximately after the fourth anniversary of the
acquisition, or sooner under certain conditions, and the minority interest
holders have the right to cause the Company to purchase the same equity interest
over the same period. Seal LLC is a distributor and designer of FAA-approved
hydraulic, pneumatic, mechanical and electro-mechanical components for the
commercial, regional and general aviation markets.

         In November 2005, the Company, through HEICO Electronic, acquired all
of the stock of Engineering Design Team, Inc. and substantially all of the
assets of its affiliate (collectively "EDT"). EDT specializes in the design,
manufacture, and sale of advanced high-technology, high-speed interface
products that link devices such as telemetry receivers, digital cameras, high
resolution scanners, simulation systems and test systems to almost any
computer. EDT's products are utilized in homeland security, defense, medical,
research, astronomical and other applications across numerous industries.

                                       53
<PAGE>

         In May 2006, the Company, through HEICO Aerospace, acquired all of the
stock of Arger Enterprises, Inc. and its related companies (collectively
"Arger"). Arger designs and distributes FAA-approved aircraft and engine parts
primarily for the commercial aviation market. The Company has since combined the
operations of Arger within other subsidiaries of HEICO Aerospace. As of the
acquisition date, the Company recognized a $1.8 million restructuring liability
as part of the acquisition costs consisting principally of employee termination
and relocation costs, moving costs and associated expenses and contract
termination costs. During the remainder of fiscal 2006, $1.1 million of such
accrued costs were paid and $.6 million were deemed not necessary and reversed.
The remaining $.1 million of costs was paid during the first quarter of fiscal
2007.

         In September 2006, the Company, through HEICO Aerospace, acquired an
80% interest in the business, assets and certain liabilities of Prime Air, Inc.,
and its affiliate (collectively "Prime"). Under the transaction, a new
subsidiary was formed, Prime Air, LLC ("Prime Air"), which acquired
substantially all of the assets and assumed certain liabilities of Prime. Prime
Air is owned 80% by the Company and 20% by certain members of Prime's management
group. The Company has the right to purchase the remaining 20% minority
interests beginning at approximately the eighth anniversary of the acquisition,
or sooner under certain conditions, and the minority interest holders have the
right to cause the Company to purchase the same equity interest over the same
period. Prime Air provides commercial airlines, regional operators, asset
management companies and MRO providers with high quality and cost effective
niche accessory component exchange services as an alternative to OEMs' spares
services.

         During the first quarter of fiscal 2007, the Company, through HEICO
Aerospace, acquired an additional 10% of the equity interests in one of its
subsidiaries, which increased the Company's ownership interest to 90%. The
purchase price of the acquired equity interest was paid using cash provided by
operating activities.

         In April 2007, the Company, through HEICO Electronic, acquired all the
stock of FerriShield, Inc. ("FerriShield"). FerriShield is engaged in the design
and manufacture of Radio Frequency Interference and Electromagnetic Frequency
Interference Suppressors for a variety of markets. The Company has since
integrated the operations of FerriShield into the operations of one of its
existing subsidiaries.

         In May 2007, the Company, through HEICO Aerospace, acquired certain
assets of a supplier. The acquired assets were integrated into one of its
existing subsidiaries and will be utilized to bring certain manufacturing
operations in-house. The purchase price was paid using cash provided by
operating activities.

         In August 2007, the Company, through HEICO Aerospace, acquired
substantially all of the assets and assumed certain liabilities of a U.S.
company that designs and manufactures FAA-approved aircraft and engine parts
primarily for the commercial aviation market.

         In September 2007, the Company, through HEICO Electronic, acquired all
of the stock of EMD Technologies Inc. ("EMD"). Subject to meeting certain
earnings objectives during the first five years following the acquisition, the
Company may be obligated to pay additional purchase consideration of up to 73
million Canadian dollars in aggregate, which translates to $59.7 million U.S.
dollars based on the October 31, 2008 exchange rate. EMD designs and
manufactures high voltage energy generators for medical, baggage inspection and
industrial imaging manufacturers and high frequency power delivery systems for
the commercial sign industry.

         During both April 2007 and 2008, the Company, through HEICO Electronic,
acquired an additional .75% of the equity interests in one of its subsidiaries,
which increased the Company's

                                       54
<PAGE>

ownership interest from 85% to 86.5%. The purchase prices of the acquired equity
interests were paid using cash provided by operating activities.

         In November 2007, the Company, through an 80%-owned subsidiary of HEICO
Aerospace, acquired all of the stock of a European company. Subject to meeting
certain earnings objectives during the third, fourth and fifth years following
the acquisition, the Company may be obligated to pay additional consideration of
up to approximately $.4 million in aggregate. The acquired company supplies
aircraft parts for sale and exchange as well as repair management services to
commercial and regional airlines, asset management companies and FAA overhaul
and repair facilities.

         In January 2008, the Company, through HEICO Aerospace, acquired certain
assets and assumed certain liabilities of a U.S. company that designs and
manufactures FAA-approved aircraft and engine parts primarily for the
commercial aviation market. The Company has since combined the operations of
the acquired entity within other subsidiaries of HEICO Aerospace.

         In February 2008, the Company, through HEICO Aerospace, acquired an 80%
interest in certain assets and certain liabilities of a U.S. company that is an
FAA-approved repair station which specializes in avionics primarily for the
commercial aviation market. The remaining 20% is principally owned by certain
members of the acquired company's management. The Company has the right to
purchase the minority interests beginning at approximately the sixth anniversary
of the acquisition, or sooner under certain conditions, and the minority
interest holders have the right to cause the Company to purchase the same equity
interest over the same period.

         As part of the purchase agreement associated with certain acquisitions,
the Company may be obligated to pay additional purchase consideration based on
the acquired subsidiary meeting certain earnings objectives following the
acquisition. The Company accrues an estimate of additional purchase
consideration when the earnings objectives are met. During fiscal 2008, the
Company, through HEICO Aerospace and HEICO Electronic, paid $7.0 million and
$4.7 million, respectively, of such additional purchase consideration related
to acquisitions made in previous years, all of which was accrued as of October
31, 2007. During fiscal 2007 and 2006, the Company, through HEICO Electronic,
paid $7.3 million and $2.2 million, respectively, of such additional purchase
consideration related to acquisitions made in previous years, of which $7.2
million and $2.2 million respectively, was accrued as of October 31, 2006 and
2005, respectively. As of October 31, 2008, the Company, through HEICO
Electronic, accrued $2.2 million of additional purchase consideration related to
a prior year acquisition, which it expects to pay in fiscal 2009. The amounts
paid in fiscal 2008, 2007 and 2006 were based on a multiple of each applicable
subsidiary's earnings relative to target. Since these amounts were not
contingent upon the former shareholders of each acquired entity remaining
employed by the Company or providing future services to the Company, the
payments were recorded as an additional cost of the respective acquired entity.
Information regarding additional purchase consideration related to acquisitions
may be found in Note 14, Commitments and Contingencies - Acquisitions, of the
Notes to Consolidated Financial Statements.

         All of the acquisitions described above were accounted for using the
purchase method of accounting. The purchase price of each acquisition was
principally paid in cash using proceeds from the Company's revolving credit
facility unless otherwise noted and was not significant to the Company's
consolidated financial statements. The results of operations of each acquired
company were included in the Company's results of operations from their
effective acquisition date. The following table presents the Company's unaudited
pro forma consolidated operating results assuming the fiscal 2008 and 2007
acquisitions had been consummated as of the beginning of fiscal 2007. The pro
forma financial information is presented for comparative purposes only and is
not necessarily indicative of the results of operations that actually would have
been achieved if the acquisitions had taken place as of the beginning

                                       55
<PAGE>

fiscal 2007. The unaudited pro forma financial information includes adjustments
to historical amounts such as additional amortization expense related to
acquired intangible assets, increased interest expense associated with
borrowings to finance the acquisitions, and, when applicable, incremental
minority interest in net income.

                                       For the year ended October 31,
                                       ------------------------------
                                         2008                  2007
                                       --------              --------
         Net sales                     $583,837              $533,669
         Net income                     $48,638               $38,886
         Net income per share:
           Basic                          $1.85                 $1.51
           Diluted                        $1.79                 $1.44

         The allocation of the purchase price of each acquisition to the
tangible and identifiable intangible assets acquired and liabilities assumed is
based on their estimated fair values as of the date of acquisition. The Company
determines the fair values of such assets and liabilities, generally in
consultation with third-party valuation advisors. The allocation of the
purchase price of the fiscal 2008 acquisitions to the tangible and identifiable
intangible assets acquired and liabilities assumed in these consolidated
financial statements is preliminary until the Company obtains final information
regarding their fair values. The excess of the purchase price over the net of
the amounts assigned to assets acquired and liabilities assumed has been
recorded as goodwill (see Note 15, Supplemental Disclosures of Cash Flow
Information, of the Notes to Consolidated Financial Statements). The aggregate
cost of acquisitions, including payments made in cash and contingent payments,
was $29.0 million, $48.4 million and $58.1 million in fiscal 2008, 2007 and
2006, respectively.

3. SELECTED FINANCIAL STATEMENT INFORMATION

Accounts Receivable
                                                        As of October 31,
                                                 ------------------------------
                                                    2008               2007
                                                 -----------        -----------
   Accounts receivable                           $90,990,000        $84,111,000
   Less:  Allowance for doubtful accounts         (2,587,000)        (1,712,000)
                                                 -----------        -----------
     Accounts receivable, net                    $88,403,000        $82,399,000
                                                 ===========        ===========

                                       56
<PAGE>

         Costs and Estimated Earnings on Uncompleted Percentage-of-Completion
Contracts

<TABLE>
<CAPTION>
                                                                              As of October 31,
                                                                       --------------------------------
                                                                          2008                 2007
                                                                       -----------          -----------
<S>                                                                    <C>                  <C>
Costs incurred on uncompleted contracts                                $21,505,000          $21,832,000
Estimated earnings                                                      12,545,000           13,111,000
                                                                       -----------          -----------
                                                                        34,050,000           34,943,000
Less:  Billings to date                                                (28,337,000)         (25,661,000)
                                                                       -----------          -----------
                                                                        $5,713,000           $9,282,000
                                                                       ===========          ===========
Included in accompanying Consolidated Balance
  Sheets under the following captions:
    Accounts receivable, net (costs and estimated
         earnings in excess of billings)                                $6,115,000           $9,300,000
    Accrued expenses and other current liabilities
         (billings in excess of costs and estimated earnings)             (402,000)             (18,000)
                                                                       -----------          -----------
                                                                        $5,713,000           $9,282,000
                                                                       ===========          ===========
</TABLE>

         Changes in estimates did not have a material effect on net income or
diluted net income per share in fiscal 2008, 2007 or 2006.

Inventories

<TABLE>
<CAPTION>
                                                                              As of October 31,
                                                                       ---------------------------------
                                                                          2008                 2007
                                                                       ------------         ------------
<S>                                                                    <C>                  <C>
Finished products                                                       $74,281,000          $61,592,000
Work in process                                                          17,897,000           15,406,000
Materials, parts, assemblies and supplies                                40,732,000           38,772,000
                                                                       ------------         ------------
  Inventories, net                                                     $132,910,000         $115,770,000
                                                                       ============         ============
</TABLE>

         Inventories related to long-term contracts were not significant as of
October 31, 2008 and 2007.

Property, Plant and Equipment

<TABLE>
<CAPTION>
                                                                              As of October 31,
                                                                       --------------------------------
                                                                          2008                 2007
                                                                       -----------          -----------
<S>                                                                    <C>                  <C>
Land                                                                    $3,656,000           $3,656,000
Buildings and improvements                                              36,229,000           30,732,000
Machinery, equipment and tooling                                        73,038,000           65,242,000
Construction in progress                                                 5,446,000            6,339,000
                                                                       -----------          -----------
                                                                       118,369,000          105,969,000
Less:  Accumulated depreciation and amortization                       (58,403,000)         (50,415,000)
                                                                       -----------          -----------
  Property, plant and equipment, net                                   $59,966,000          $55,554,000
                                                                       ===========          ===========
</TABLE>

         The amounts set forth above include tooling costs having a net book
value of $4,037,000 and $4,165,000 as of October 31, 2008 and 2007,
respectively. Amortization expense on capitalized tooling was $1,575,000,
$1,448,000 and $1,304,000 for the fiscal years ended October 31, 2008, 2007 and
2006, respectively. Expenditures for capitalized tooling costs were $1,412,000,
$1,634,000 and $1,363,000 in fiscal 2008, 2007 and 2006, respectively.

         Depreciation and amortization expense, exclusive of tooling, on
property, plant and equipment was $7,990,000, $6,678,000 and $5,786,000 for the
fiscal years ended October 31, 2008, 2007 and 2006, respectively.

                                       57
<PAGE>

         Included in the Company's property, plant and equipment is rotable
equipment located at various customer locations in connection with certain
repair and maintenance agreements. The rotables are stated at a net book value
of $908,000 and $1,195,000 as of October 31, 2008 and 2007, respectively. Under
the terms of the agreements, the customers may purchase the equipment at
specified prices, which are no less than net book value, upon termination of the
agreements. The equipment is currently being depreciated over its estimated
life.

Accrued Expenses and Other Current Liabilities

<TABLE>
<CAPTION>
                                                                              As of October 31,
                                                                       --------------------------------
                                                                          2008                 2007
                                                                       -----------          -----------
<S>                                                                    <C>                  <C>
Accrued employee compensation and related payroll taxes                $25,157,000          $21,551,000
Accrued customer rebates and credits                                    11,758,000           10,452,000
Accrued additional purchase consideration                                3,427,000           11,736,000
Other                                                                    9,244,000           10,139,000
                                                                       -----------          -----------
  Accrued expenses and other current liabilities                       $49,586,000          $53,878,000
                                                                       ===========          ===========
</TABLE>

       The total customer rebates and credits deducted within net sales for the
fiscal years ended October 31, 2008, 2007 and 2006 were $10,249,000, $9,574,000
and $7,611,000, respectively.

Other Non-Current Liabilities

         During fiscal 2006, the Company established the HEICO Corporation
Leadership Compensation Plan ("LCP"), a nonqualified deferred compensation plan
that conforms to Section 409A of the Internal Revenue Code. The LCP was
effective October 1, 2006 and provides eligible employees, officers and
directors of the Company the opportunity to voluntarily defer base salary, bonus
payments, commissions, long-term incentive awards and directors fees, as
applicable, on a pre-tax basis. The Company matches 50% of the first 6% of base
salary deferred by each participant. In September 2008, the LCP was amended
principally to allow director fees that would otherwise be payable in Company
common stock to be deferred into the Plan, and, when distributed, amounts would
be distributable in actual shares of Company common stock. In December 2008, the
LCP was amended to comply with the final Section 409A regulations issued by the
Internal Revenue Service, which become effective January 1, 2009. Further, while
the Company has no obligation to do so, the LCP also provides the Company the
opportunity to make discretionary contributions. The Company's matching
contributions and any discretionary contributions are subject to vesting and
forfeiture provisions set forth in the LCP. Company contributions to the Plan
charged to income in fiscal 2008, 2007 and 2006 totaled $2,075,000, $2,119,000
and $985,000, respectively. In the accompanying Consolidated Balance Sheets,
$623,000 was included in accrued expenses and other current liabilities and
$7,136,000 in other non-current liabilities as of October 31, 2008, and
$688,000 was included in accrued expenses and other current liabilities and
$4,586,000 in other non-current liabilities as of October 31, 2007. The assets
of the LCP, totaling $7,148,000 and $4,559,000 as of October 31, 2008, and 2007,
respectively, are classified within other assets (long-term) and represent cash
surrender values of life insurance policies that are held within an irrevocable
trust that may be used to satisfy the obligations under the LCP.

        Other non-current liabilities also includes deferred compensation of
$3,860,000 and $5,201,000 as of October 31, 2008 and 2007, respectively,
principally related to elective deferrals of salary and bonuses under a Company
sponsored non-qualified deferred compensation plan available to selected
employees. The Company makes no contributions to this plan. The assets of this
plan related to this deferred compensation liability are held within an
irrevocable trust and classified within other assets (long-term) in the
accompanying Consolidated Balance Sheets.

                                       58
<PAGE>

4. GOODWILL AND OTHER INTANGIBLE ASSETS

         The Company has two operating segments: the Flight Support Group
("FSG") and the Electronic Technologies Group ("ETG"). Changes in the carrying
amount of goodwill during fiscal 2008 and 2007 by operating segment are as
follows:

<TABLE>
<CAPTION>
                                                              Segment
                                                    ------------------------------     Consolidated
                                                         FSG               ETG            Totals
                                                    ------------      ------------     -------------
<S>                                                 <C>               <C>               <C>
Balances as of October 31, 2006                     $157,204,000      $117,912,000      $275,116,000
Goodwill acquired                                      6,210,000        16,550,000        22,760,000
Accrued additional purchase consideration              7,000,000         4,736,000        11,736,000
Foreign currency translation adjustments                   --            1,354,000         1,354,000
Adjustments to goodwill                                 (725,000)          261,000          (464,000)
                                                    ------------      ------------      ------------
Balances as of October 31, 2007                      169,689,000       140,813,000       310,502,000
Goodwill acquired                                      9,094,000            74,000         9,168,000
Accrued additional purchase consideration              1,215,000         2,212,000         3,427,000
Foreign currency translation adjustments                (363,000)       (3,505,000)       (3,868,000)
Adjustments to goodwill                                1,491,000         2,673,000         4,164,000
                                                    ------------      ------------      ------------
Balances as of October 31, 2008                     $181,126,000      $142,267,000      $323,393,000
                                                    ============      ============      ============
</TABLE>

         The goodwill acquired and accrued additional purchase consideration
recognized during fiscal 2008 and 2007 are principally a result of the Company's
acquisitions described in Note 2, Acquisitions, of the Notes to Consolidated
Financial Statements. The $1.2 million accrued additional purchase
consideration recognized during fiscal 2008 by the FSG is the result of the
Company's purchase of the remaining 10% of equity interests in a 90%-owned
subsidiary effective October 31, 2008 (see Note 14, Commitments and
Contingencies, of the Notes to Consolidated Financial Statements). The foreign
currency translation adjustments reflect unrealized translation gains (losses)
on the goodwill recognized in connection with foreign subsidiaries. Foreign
currency translation adjustments are included in other comprehensive income in
the Company's Consolidated Statements of Shareholders' Equity and Comprehensive
Income. Adjustments to goodwill during fiscal 2008 and 2007 consist primarily of
final purchase price adjustments related to the preliminary allocation of the
purchase price during the allocation period for certain prior year acquisitions
to the assets acquired and liabilities assumed. The Company estimates that
approximately $13 million and $30 million of the goodwill recognized in fiscal
2008 and 2007, respectively, will be deductible for income tax purposes. Based
on the annual goodwill test for impairment as of October 31, 2008, the Company
determined there is no impairment of its goodwill.

                                       59
<PAGE>

         Identifiable intangible assets consist of:

<TABLE>
<CAPTION>
                                     As of October 31, 2008                       As of October 31, 2007
                         --------------------------------------------    -----------------------------------------
                           Gross                             Net           Gross                          Net
                          Carrying          Accumulated    Carrying       Carrying      Accumulated     Carrying
                           Amount          Amortization     Amount         Amount       Amortization     Amount
                         -----------       ------------   -----------    -----------    ------------   -----------
<S>                      <C>               <C>            <C>            <C>            <C>            <C>
Amortizing Assets:
------------------
Customer relationships   $16,845,000       ($6,451,000)   $10,394,000    $19,784,000    ($4,912,000)   $14,872,000
Intellectual property      3,427,000        (1,833,000)     1,594,000      6,204,000     (1,066,000)     5,138,000
Licenses                   1,000,000          (474,000)       526,000      1,000,000       (400,000)       600,000
Non-compete agreements     1,086,000          (660,000)       426,000        937,000       (628,000)       309,000
Patents                      575,000          (189,000)       386,000        560,000       (132,000)       428,000
                         -----------       -----------    -----------    -----------    -----------    -----------
                          22,933,000        (9,607,000)    13,326,000     28,485,000     (7,138,000)    21,347,000
Non-Amortizing Assets:
----------------------
Trade names               11,657,000                --     11,657,000     13,986,000             --     13,986,000
                         -----------       -----------    -----------    -----------    -----------    -----------
                         $34,590,000       ($9,607,000)   $24,983,000    $42,471,000    ($7,138,000)   $35,333,000
                         ===========       ===========    ===========    ===========    ===========    ===========
</TABLE>

         The decrease in the gross carrying amount of identifiable intangible
assets as of October 31, 2008 compared to October 31, 2007 principally relates
to the final purchase price adjustments to the preliminary fair values of such
intangible assets recognized in connection with certain prior year acquisitions,
the effect of foreign currency translation adjustments on the intangible assets
recognized as part of the aforementioned foreign subsidiaries, the write-off of
fully amortized intangible assets and impairment losses of certain intangible
assets, partially offset by the intangible assets recognized in connection with
the fiscal 2008 acquisitions (see Note 2, Acquisitions, and Note 15,
Supplemental Disclosures of Cash Flow Information, of the Notes to Consolidated
Financial Statements). During the fourth quarter of fiscal 2008, the Company
recognized impairment losses of $1,313,000 and $522,000, from the write-down of
certain customer relationships and trade names, respectively, within the ETG to
their estimated fair values, due to reductions in future cash flows associated
with such assets. The impairment losses were recorded as a component of selling,
general and administrative expenses in the Company's Consolidated Statements of
Operations.

         The weighted average amortization period of the customer relationships
and non-compete agreements acquired during fiscal 2008 is approximately six and
four years, respectively. The weighted average amortization period of the
customer relationships, intellectual property, and non-compete agreements
acquired during fiscal 2007 is approximately seven, fourteen and two years,
respectively, after accounting for the aforementioned final purchase price
adjustments. Amortization expense of other intangible assets was $5,156,000,
$3,647,000 and $3,057,000 for the fiscal years ended October 31, 2008, 2007 and
2006, respectively. Amortization expense for each of the next five fiscal years
is expected to be $3,649,000 in fiscal 2009, $2,930,000 in fiscal 2010,
$2,229,000 in fiscal 2011, $1,625,000 in fiscal 2012 and $1,119,000 in fiscal
2013.

5. SHORT-TERM AND LONG-TERM DEBT

        In September 2008, one of the Company's subsidiaries extended a
short-term line of credit with a bank in the amount of $2.5 million, which now
expires in June 2009. The line of credit may be used for inventory purchases and
other working capital needs and is secured by all the assets of the subsidiary.
Advances under the line of credit bear interest at the subsidiary's choice of
the "Prime Rate Advance" (a rate equal to the greater of 4% or prime rate less
..75%) or "LIBOR Advance" (LIBOR rate plus .75%). As of October 31, 2008 and
2007, no borrowings were outstanding under the line of credit.

                                       60
<PAGE>

         Long-term debt consists of:

<TABLE>
<CAPTION>
                                                                              As of October 31,
                                                                       --------------------------------
                                                                          2008                 2007
                                                                       -----------          -----------
<S>                                                                    <C>                  <C>
Borrowings under revolving credit facility                             $37,000,000          $53,000,000
Industrial Development Revenue Refunding
   Bonds - Series 1988                                                          --            1,980,000
Notes payable, capital leases and equipment loans                          601,000              972,000
                                                                       -----------          -----------
                                                                        37,601,000           55,952,000
Less: Current maturities of long-term debt                                (220,000)          (2,187,000)
                                                                       -----------          -----------
                                                                       $37,381,000          $53,765,000
                                                                       ===========          ===========
</TABLE>

         The aggregate amount of long-term debt maturing in each of the next
five fiscal years is $220,000 in fiscal 2009, $214,000 in fiscal 2010, $115,000
in fiscal 2011, $35,000 in fiscal 2012 and $37,017,000 in fiscal 2013.

Revolving Credit Facility

         In May 2008, the Company amended its revolving credit facility by
entering into a $300 million Second Amended and Restated Revolving Credit
Agreement ("Credit Facility") with a bank syndicate, which matures in May 2013.
Under certain circumstances, the maturity may be extended for two one-year
periods. The Credit Facility also includes a feature that will allow the Company
to increase the Credit Facility, at its option, up to $500 million through
increased commitments from existing lenders or the addition of new lenders. The
Credit Facility may be used for working capital and general corporate needs of
the Company, including letters of credit, capital expenditures and to finance
acquisitions. Advances under the Credit Facility accrue interest at the
Company's choice of the "Base Rate" or the London Interbank Offered Rate
("LIBOR") plus applicable margins (based on the Company's ratio of total funded
debt to earnings before interest, taxes, depreciation and amortization, minority
interest and non-cash charges, or "leverage ratio"). The Base Rate is the higher
of (i) the Prime Rate or (ii) the Federal Funds rate plus .50%. The applicable
margins for LIBOR-based borrowings range from .625% to 2.25%. A fee is charged
on the amount of the unused commitment ranging from .125% to .35% (depending on
the Company's leverage ratio). The Credit Facility also includes a $50 million
sublimit for borrowings made in euros, a $30 million sublimit for letters of
credit and a $20 million swingline sublimit. The Credit Facility is unsecured
and contains covenants that require, among other things, the maintenance of the
leverage ratio, a senior leverage ratio and a fixed charge coverage ratio. In
the event the Company's leverage ratio exceeds a specified level, the Credit
Facility would become secured by the capital stock owned in substantially all of
the Company's subsidiaries.

         As of October 31, 2008 and 2007, the Company had a total of $37 million
and $53 million, respectively, borrowed under its revolving credit facility at
weighted average interest rates of 3.6% and 5.8%, respectively. The amounts were
primarily borrowed to fund acquisitions (see Note 2, Acquisitions, of the Notes
to Consolidated Financial Statements) as well as for working capital and general
corporate needs. The revolving credit facility contains both financial and
non-financial covenants. As of October 31, 2008, the Company was in compliance
with all such covenants.

Industrial Development Revenue Bonds

         In April 2008, the Company paid the matured Series 1988 industrial
development revenue bonds aggregating $1,980,000.

                                       61
<PAGE>

6. INCOME TAXES

         The provision for income taxes on income before income taxes and
minority interests is as follows:

<TABLE>
<CAPTION>
                                              For the year ended October 31,
                                         ---------------------------------------
                                            2008          2007          2006
                                         -----------   -----------   -----------
<S>                                      <C>           <C>           <C>
Current:
 Federal                                 $27,118,000   $20,688,000   $15,301,000
 State                                     4,225,000     3,746,000     2,780,000
 Foreign                                     490,000       277,000       262,000
                                         -----------   -----------   -----------
                                          31,833,000    24,711,000    18,343,000
Deferred                                   3,617,000     2,819,000     2,557,000
                                         -----------   -----------   -----------
Total income tax expense                 $35,450,000   $27,530,000   $20,900,000
                                         ===========   ===========   ===========
</TABLE>

         The reconciliation of the federal statutory tax rate to the Company's
effective tax rate is as follows:

<TABLE>
<CAPTION>
                                                                              For the year ended October 31,
                                                                           ----------------------------------
                                                                            2008          2007          2006
                                                                           ------        ------        ------
<S>                                                                         <C>           <C>           <C>
Federal statutory tax rate                                                  35.0%         35.0%         35.0%
State taxes, less applicable federal income tax reduction                    2.9           3.3           3.5
Net tax benefit on minority interests' share of income                      (3.0)         (3.4)         (2.7)
Net tax benefit on qualified domestic production activities                  (.7)          (.4)          (.5)
Net tax benefit on qualified research and development activities             (.3)         (1.8)         (2.4)
Net tax benefit on export sales                                               --           (.2)         (1.3)
Other, net                                                                   0.6           0.7           1.1
                                                                           ------        ------        ------
     Effective tax rate                                                     34.5%         33.2%         32.7%
                                                                           ======        ======        ======
</TABLE>

         Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. The Company
believes that it is more likely than not that it will generate sufficient future
taxable income to utilize all of its deferred tax assets and has therefore not
recorded a valuation allowance on any such asset. Significant components of the
Company's deferred tax assets and liabilities are as follows:

<TABLE>
<CAPTION>
                                                       As of October 31,
                                               --------------------------------
                                                   2008                2007
                                               ------------        ------------
<S>                                            <C>                 <C>
Deferred tax assets:
 Inventories                                     $7,483,000          $6,791,000
 Deferred compensation liability                  4,240,000           4,603,000
 FIN 48 liability - related                       2,684,000                  --
 Customer rebates accrual                         1,097,000             875,000
 Vacation accrual                                   884,000             786,000
 Allowance for doubtful accounts receivable         821,000             526,000
 Other                                            3,320,000           2,668,000
                                               ------------        ------------
    Total deferred tax assets                    20,529,000          16,249,000
                                               ------------        ------------
Deferred tax liabilities:
 Intangible asset amortization                   40,695,000          37,252,000
 Accelerated depreciation                         3,778,000           3,194,000
 Software development costs                       1,019,000             836,000
 Other                                              272,000             128,000
                                               ------------        ------------
    Total deferred tax liabilities               45,764,000          41,410,000
                                               ------------        ------------
    Net deferred tax liability                 ($25,235,000)       ($25,161,000)
                                               ============        ============
</TABLE>

                                       62
<PAGE>

         The net deferred tax liability is classified in the accompanying
Consolidated Balance Sheets as follows:

<TABLE>
<CAPTION>
                                                       As of October 31,
                                               --------------------------------
                                                   2008                2007
                                               ------------        ------------
<S>                                            <C>                 <C>
Current asset                                   $13,957,000         $10,135,000
Long-term liability                              39,192,000          35,296,000
                                               ------------        ------------
Net deferred tax liability                     ($25,235,000)       ($25,161,000)
                                               ============        ============
</TABLE>

         As discussed in Note 1, Summary of Significant Accounting Policies -
Income Taxes, of the Notes to Consolidated Financial Statements, the Company
adopted the provisions of FIN 48 effective November 1, 2007. As a result, the
Company increased its liabilities related to uncertain tax positions by
$4,622,000 and accounted for this change as a $3,889,000 increase to deferred
tax assets, a $639,000 decrease to retained earnings (the cumulative effect of
adopting FIN 48), and a $94,000 decrease to deferred tax liabilities. Upon
adoption, the Company also reclassified $2,680,000 in unrecognized tax benefits
and $2,621,000 of income tax refunds (related to research and development
activities as further described below) from income taxes payable to long-term
income tax liabilities and long-term income tax assets, respectively, since the
Company does not anticipate payment or receipt of cash within one year.
Long-term income tax liabilities are classified within other non-current
liabilities and long-term income tax assets are classified within other assets
in the Company's Consolidated Balance Sheets.

         As of November 1, 2007 and October 31, 2008, the Company's liability
for gross unrecognized tax benefits related to uncertain tax positions was
$7,396,000 and $5,742,000, respectively, of which $2,948,000 and $3,438,000,
respectively, would decrease the Company's income tax expense and effective
income tax rate if the tax benefits were recognized. The remaining liability was
for tax positions for which the uncertainty was only related to the timing of
such tax benefits. A reconciliation of the activity related to the liability for
gross unrecognized tax benefits during fiscal 2008 follows:

     Balance as of November 1, 2007                            $7,396,000
     Increases related to prior year tax positions                  2,000
     Decreases related to prior year tax positions             (4,380,000)
     Increases related to current year tax positions            2,793,000
     Lapse of statutes of limitations                             (69,000)
                                                               ----------
     Balance as of October 31, 2008                            $5,742,000
                                                               ==========

         The Company's liability for unrecognized tax benefits was $5,513,000
as of October 31, 2008, including $232,000 of interest and $96,000 of penalties
and net of $557,000 in related deferred tax assets. Effective with the adoption
of FIN 48, it is the Company's policy to recognize interest and penalties
related to income tax matters as a component of income tax expense. Interest and
penalties, which were not significant in fiscal 2007, were previously recorded
in interest expense and in selling, general and administrative expenses,
respectively, in the Company's Consolidated Statements of Operations. During
the fiscal year ended October 31, 2008, the Company accrued penalties of $23,000
related to the unrecognized tax benefits noted above. The liability for interest
decreased by $252,000 during fiscal 2008 due to the lapse of statutes of
limitations.

         The Company files income tax returns in the United States ("U.S.")
federal jurisdiction and in multiple state jurisdictions. The Company is also
subject to income taxes in certain jurisdictions outside the U.S., none of which
are individually material to the accompanying consolidated financial statements.
Generally, the Company is no longer subject to U.S. federal or state
examinations by tax authorities for fiscal years prior to 2001. The Company's
U.S. federal filings and state of California filings for fiscal

                                       63
<PAGE>

years 2001 through 2005 are currently under examination by the Internal Revenue
Service and California Franchise Tax Board, respectively, who are reviewing the
income tax credit claimed by the Company for qualified research and development
activities incurred during those years.

         The total amount of unrecognized tax benefits can change due to audit
settlements, tax examination activities, lapse of applicable statutes of
limitations and the recognition and measurement criteria under FIN 48. The
Company is unable to estimate what this change could be within the next twelve
months, but does not believe it would be material to its consolidated financial
statements.

         In December 2006, Section 41 of the Internal Revenue Code, "Credit for
Increasing Research Activities," was retroactively extended for two years to
cover the period from January 1, 2006 to December 31, 2007. As a result, the
Company recognized an income tax credit for qualified research and development
activities in fiscal 2007 for the full fiscal 2006 year. The tax credit, net of
expenses, increased fiscal 2007 net income by approximately $.5 million.

         The Company claimed an income tax credit for qualified research and
development activities in its income tax return for fiscal 2005 and amended
returns for previous tax years that were filed in the third and fourth quarters
of fiscal 2006 upon completion of a study conducted by outside tax consultants.
The aggregate tax credit, net of expenses, increased fiscal 2006 net income by
approximately $1.0 million.

7. SHAREHOLDERS' EQUITY

Preferred Stock Purchase Rights Plan

         The Company's Board of Directors adopted, as of November 2, 2003, a
Shareholder Rights Agreement (the "2003 Plan"). Pursuant to the 2003 Plan, the
Board declared a dividend of one preferred share purchase right for each
outstanding share of Common Stock and Class A Common Stock (with the preferred
share purchase rights collectively as the "Rights"). The Rights trade with the
common stock and are not exercisable or transferable apart from the Common
Stock and Class A Common Stock until after a person or group either acquires 15%
or more of the outstanding common stock or commences or announces an intention
to commence a tender offer for 15% or more of the outstanding common stock.
Absent either of the aforementioned events transpiring, the Rights will expire
as of the close of business on November 2, 2013.

         The Rights have certain anti-takeover effects and, therefore, will
cause substantial dilution to a person or group who attempts to acquire the
Company on terms not approved by the Company's Board of Directors or who
acquires 15% or more of the outstanding common stock without approval of the
Company's Board of Directors. The Rights should not interfere with any merger
or other business combination approved by the Board since they may be redeemed
by the Company at $.01 per Right at any time until the close of business on the
tenth day after a person or group has obtained beneficial ownership of 15% or
more of the outstanding common stock or until a person commences or announces an
intention to commence a tender offer for 15% or more of the outstanding common
stock. The 2003 Plan also contains a provision to help ensure a potential
acquirer pays all shareholders a fair price for the Company.

Common Stock and Class A Common Stock

         Each share of Common Stock is entitled to one vote per share. Each
share of Class A Common Stock is entitled to a 1/10 vote per share. Holders of
the Company's Common Stock and Class A Common Stock are entitled to receive
when, as and if declared by the Board of Directors, dividends and other
distributions payable in cash, property, stock or otherwise. In the event of
liquidation, after

                                       64
<PAGE>

payment of debts and other liabilities of the Company, and after making
provision for the holders of preferred stock, if any, the remaining assets of
the Company will be distributable ratably among the holders of all classes of
common stock.

Share Repurchases

        The Company did not repurchase any shares of its common stock in fiscal
2008, 2007 or 2006.

8. STOCK OPTIONS

         The Company currently has two stock option plans, the 2002 Stock Option
Plan ("2002 Plan") and the Non-Qualified Stock Option Plan, under which stock
options may be granted. The Company's 1993 Stock Option Plan ("1993 Plan")
terminated in March 2003 on the tenth anniversary of its effective date. No
options may be granted under the 1993 Plan after such termination date; however,
options outstanding as of the termination date may be exercised pursuant to
their terms. In addition, the Company granted stock options to a former
shareholder of an acquired business pursuant to an employment agreement entered
into in connection with the acquisition in fiscal 1999. A total of 3,287,306
shares of the Company's stock are reserved for issuance to employees, directors,
officers and consultants as of October 31, 2008, including 1,623,742 shares
currently under option and 1,663,564 shares available for future grants. Options
issued under the 2002 Plan may be designated as incentive stock options or non-
qualified stock options. Incentive stock options are granted with an exercise
price of not less than 100% of the fair market value of the Company's common
stock as of date of grant (110% thereof in certain cases) and are exercisable in
percentages specified as of the date of grant over a period up to ten years.
Only employees are eligible to receive incentive stock options. Non-qualified
stock options under the 2002 Plan may be immediately exercisable. In March 2008,
the Company's shareholders approved two amendments to the 2002 Plan, which
principally increased the number of shares available for issuance under the plan
and now requires options be granted with an exercise price of no less than fair
market value of the Company's common stock as of the date of the grant. The
options granted pursuant to the 2002 Plan may be designated as Common Stock
and/or Class A Common Stock in such proportions as shall be determined by the
Board of Directors or the Stock Option Plan Committee at its sole discretion.
Options granted under the Non-Qualified Stock Option Plan may be granted with
an exercise price of no less than the fair market value of the Company's common
stock as of the date of grant and are generally exercisable in four equal
annual installments commencing one year from the date of grant. The stock
options granted to a former shareholder of an acquired business were fully
vested and transferable as of the grant date and expire ten years from the date
of grant. The exercise price of such options was the fair market value as of the
date of grant. Options under all stock option plans expire no later than ten
years after the date of grant, unless extended by the Stock Option Plan
Committee or the Board of Directors.

                                       65
<PAGE>

         Information concerning stock option activity for each of the three
fiscal years ended October 31 is as follows:

<TABLE>
<CAPTION>
                                                                         Shares Under Option
                                                Shares            ---------------------------------
                                               Available                           Weighted Average
                                               For Grant           Shares           Exercise Price
                                               ----------         ---------        ----------------
<S>                                             <C>               <C>                   <C>
Outstanding as of October 31, 2005                156,303         3,588,680              $9.50
Granted                                                --                --                $--
Cancelled                                           6,380           (10,371)             $8.96
Exercised                                              --          (844,291)             $7.34
                                               ----------         ---------
Outstanding as of October 31, 2006                162,683         2,734,018             $10.16
Granted                                                --                --                $--
Cancelled                                             221           (16,787)            $13.11
Exercised                                              --          (841,901)            $10.94
                                               ----------         ---------
Outstanding as of October 31, 2007                162,904         1,875,330              $9.79
Shares approved by the Shareholders
  for the 2002 Stock Option Plan                1,500,000                --                $--
Granted                                                --                --                $--
Cancelled                                             660              (710)             $6.66
Exercised                                              --          (250,878)             $9.56
                                               ----------         ---------
Outstanding as of October 31, 2008              1,663,564         1,623,742              $9.83
                                               ==========         =========
</TABLE>

                                       66
<PAGE>

      Information concerning stock options outstanding and stock options
exercisable by class of common stock as of October 31, 2008 is as follows:

Common Stock

<TABLE>
<CAPTION>
                                               Options Outstanding
                      ---------------------------------------------------------------------
                                        Weighted          Weighted Average       Aggregate
     Range of            Number         Average        Remaining Contractual    Intrinsic
 Exercise Prices      Outstanding    Exercise Price         Life (Years)           Value
----------------      -----------    --------------    ---------------------    -----------
<S>                       <C>               <C>                 <C>             <C>
 $1.16 - $2.90             90,182            $2.00               .9              $3,288,000
 $2.91 - $7.00                 --              $--               --                      --
 $7.01 - $12.00           430,000            $9.20              4.1              12,586,000
$12.01 - $21.92           432,000           $13.81              2.4              10,654,000
                       ----------                                               -----------
                          952,182           $10.61              3.0             $26,528,000
                       ==========                                               ===========

<CAPTION>
                                               Options Exercisable
                      ---------------------------------------------------------------------
                                        Weighted          Weighted Average       Aggregate
     Range of            Number         Average        Remaining Contractual    Intrinsic
 Exercise Prices      Exercisable    Exercise Price         Life (Years)           Value
----------------      -----------    --------------    ---------------------    -----------
<S>                       <C>               <C>                 <C>             <C>
 $1.16 - $2.90             90,182            $2.00                .9             $3,288,000
 $2.91 - $7.00                 --              $--                --                     --
 $7.01 - $12.00           430,000            $9.20               4.1             12,586,000
$12.01 - $21.92           432,000           $13.81               2.4             10,654,000
                       ----------                                               -----------
                          952,182           $10.61               3.0            $26,528,000
                       ==========                                               ===========

<CAPTION>
Class A Common Stock

                                               Options Outstanding
                      ---------------------------------------------------------------------
                                        Weighted          Weighted Average       Aggregate
     Range of            Number         Average        Remaining Contractual    Intrinsic
 Exercise Prices      Outstanding    Exercise Price         Life (Years)           Value
----------------      -----------    --------------    ---------------------    -----------
<S>                       <C>               <C>                 <C>             <C>
 $1.16 - $2.90             95,795             $1.71              .9              $2,525,000
 $2.91 - $7.00             66,880             $5.54             4.4               1,507,000
 $7.01 - $12.00           309,756             $8.30             3.6               6,125,000
$12.01 - $21.92           199,129            $13.83             2.2               2,835,000
                       ----------                                               -----------
                          671,560             $8.72             2.9             $12,992,000
                       ==========                                               ===========

<CAPTION>
                                               Options Exercisable
                      ---------------------------------------------------------------------
                                        Weighted          Weighted Average       Aggregate
     Range of            Number         Average        Remaining Contractual     Intrinsic
 Exercise Prices      Exercisable    Exercise Price         Life (Years)           Value
----------------      -----------    --------------    ---------------------    -----------
<S>                       <C>               <C>                 <C>             <C>
 $1.16 - $2.90             95,795             $1.71              .9              $2,525,000
 $2.91 - $7.00             66,880             $5.54             4.4               1,507,000
 $7.01 - $12.00           309,756             $8.30             3.6               6,125,000
$12.01 - $21.92           196,729            $13.83             2.2               2,802,000
                       ----------                                               -----------
                          669,160             $8.70             2.9             $12,959,000
                       ==========                                               ===========
</TABLE>

         The aggregate intrinsic values in the tables above are calculated based
on the difference between the closing price per share of the underlying common
stock as reported on the New York Stock Exchange as of October 31, 2008 less the
option exercise price (if a positive spread) multiplied by the number of stock
options.

                                       67
<PAGE>

         Information concerning stock options exercised is as follows:

<TABLE>
<CAPTION>
                                                           For the year ended October 31,
                                                   ----------------------------------------------
                                                      2008              2007              2006
                                                   ----------        ----------        ----------
<S>                                                <C>               <C>               <C>
Cash proceeds from stock option exercises          $2,398,000        $6,875,000        $5,071,000
Tax benefit realized from stock option exercises    6,248,000         6,873,000         1,385,000
Intrinsic value of stock option exercises           7,854,000        20,900,000        16,105,000
</TABLE>

         The Company's net income for the fiscal years ended October 31, 2008,
2007 and 2006 includes compensation expense of $142,000, $658,000 and
$1,373,000, respectively, and an income tax benefit related to the Company's
stock options of $43,000, $165,000 and $391,000, respectively. Substantially all
of the stock option compensation expense was recorded as a component of selling,
general and administrative expenses in the Company's Consolidated Statements of
Operations. As of October 31, 2008, there was $14,000 of pre-tax unrecognized
compensation expense related to nonvested stock options, which is expected to be
recognized over a weighted average period of approximately 1.1 years.

        For the fiscal years ended October 31, 2008, 2007 and 2006, the excess
tax benefit resulting from tax deductions in excess of the cumulative
compensation cost recognized for stock options exercised was $4,324,000,
$5,262,000 and $1,550,000, respectively, and is presented as a financing
activity in the Consolidated Statements of Cash Flows.

        The Company did not grant any stock options in fiscal 2008, 2007 or
2006. If there were a change in control of the Company, none of the unvested
options outstanding would become immediately exercisable.

9. RETIREMENT PLANS

         The Company has a qualified defined contribution retirement plan (the
"Plan") under which eligible employees of the Company and its participating
subsidiaries may make Elective Deferral Contributions up to the limitations set
forth in Section 402(g) of the Internal Revenue Code. The Company generally
makes a 25% or 50% Employer Matching Contribution, as determined by the Board of
Directors, based on a participant's Elective Deferral Contribution up to 6% of
the participant's Compensation for the Elective Deferral Contribution period.
The Employer Matching Contribution may be contributed to the Plan in the form of
the Company's common stock or cash, as determined by the Company. The Company's
match of a portion of a participant's contribution is invested in Company
common stock and is based on the fair market value of the shares as of the date
of contribution. The Plan also provides that the Company may contribute to the
Plan additional amounts in its common stock or cash at the discretion of the
Board of Directors. Employee contributions can not be invested in Company common
stock.

         Participants receive 100% vesting of employee contributions and cash
dividends received on Company common stock. Vesting in Company contributions is
based on a participant's number of years of vesting service. Contributions to
the Plan charged to income in fiscal 2008, 2007, and 2006 totaled $230,000,
$164,000 and $170,000, respectively. Company contributions are made with the use
of forfeited shares within the Plan. As of October 31, 2008, the Plan held
approximately 117,000 forfeited shares of Common Stock and 139,000 forfeited
shares of Class A Common Stock, which are available to make future Company
contributions.

                                       68
<PAGE>

        In 1991, the Company established a Directors Retirement Plan covering
its then current directors. The net assets of this plan as of October 31, 2008,
2007 and 2006 were not material to the financial position of the Company. During
fiscal 2008, 2007 and 2006, $23,000, $20,000 and $64,000, respectively, were
expensed for this plan.

10. RESEARCH AND DEVELOPMENT EXPENSES

         Cost of sales amounts in fiscal 2008, 2007 and 2006 include
approximately $18.4 million, $16.5 million and $15.3 million, respectively, of
new product research and development expenses.

11. NET INCOME PER SHARE

         The computation of basic and diluted net income per share is as
follows:

<TABLE>
<CAPTION>
                                                                 For the year ended October 31,
                                                         -----------------------------------------------
                                                            2008              2007              2006
                                                         -----------       -----------       -----------
<S>                                                      <C>               <C>               <C>
Numerator:
  Net income                                             $48,511,000       $39,005,000       $31,888,000
                                                         ===========       ===========       ===========
Denominator:
  Weighted average common shares outstanding - basic      26,309,139        25,715,899        25,084,532
  Effect of dilutive stock options                           934,217         1,215,149         1,513,071
                                                         -----------       -----------       -----------
  Weighted average common shares outstanding - diluted    27,243,356        26,931,048        26,597,603
                                                         ===========       ===========       ===========

Net income per share - basic                                   $1.84             $1.52             $1.27
Net income per share - diluted                                 $1.78             $1.45             $1.20
Anti-dilutive stock options excluded                              --                --            12,540
</TABLE>

12. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

<TABLE>
<CAPTION>
                                     First            Second             Third           Fourth
                                    Quarter          Quarter            Quarter          Quarter
                                  ------------     ------------       ------------     ------------
<S>                               <C>              <C>                <C>              <C>
Net sales:
     2008                         $134,287,000     $144,039,000       $147,305,000     $156,716,000
     2007                          113,684,000      121,215,000        133,155,000      139,870,000
Gross profit:
     2008                           46,829,000       52,356,000         53,851,000       57,459,000
     2007                           37,488,000       43,667,000         47,705,000       48,598,000
Net income:
     2008                           10,086,000       11,948,000         12,827,000       13,650,000
     2007                            7,921,000        9,407,000         10,914,000       10,763,000
Net income per share:
  Basic:
     2008                                $.39              $.45               $.49            $.52
     2007                                 .31               .37                .42             .41
  Diluted:
     2008                                 .37               .44                .47             .50
     2007                                 .30               .35                .40             .40
</TABLE>

                                       69
<PAGE>

         During the first and second quarters of fiscal 2007, the Company
recorded the benefit of a tax credit (net of related expenses) for qualified
research and development activities recognized for fiscal 2006 pursuant to the
retroactive extension in December 2006 of Section 41, "Credit for Increasing
Research Activities," of the Internal Revenue Code, which increased net income
by $332,000 and $167,000, respectively, or $.01 each per diluted share.

        During the fourth quarter of fiscal 2008, the Company recorded
impairment losses related to the write-down of certain intangible assets to
their estimated fair values, which decreased net income by $1,140,000, or $.04
per diluted share, in aggregate.

         Due to changes in the average number of common shares outstanding, net
income per share for the full fiscal year may not equal the sum of the four
individual quarters.

13. OPERATING SEGMENTS

         The Company has two operating segments: the Flight Support Group
("FSG") consisting of HEICO Aerospace and its subsidiaries and the Electronic
Technologies Group ("ETG"), consisting of HEICO Electronic and its
subsidiaries. The Flight Support Group designs, manufactures, repairs and
distributes jet engine and aircraft component replacement parts. The parts and
services are approved by the FAA. The FSG also manufactures and sells specialty
parts as a subcontractor for aerospace and industrial original equipment
manufacturers and the United States government. The Electronic Technologies
Group designs and manufactures electronic, microwave, and electro-optical
equipment and components, high-speed interface products, high voltage
interconnection devices, and high voltage advanced power electronics products
primarily for the aviation, defense, space, homeland security, electronics and
medical industries.

        The Company's reportable operating segments offer distinctive products
and services that are marketed through different channels. They are managed
separately because of their unique technology and service requirements.

Segment Profit or Loss

        The accounting policies of the Company's operating segments are the
same as those described in Note 1, Summary of Significant Accounting Policies,
of the Notes to Consolidated Financial Statements. Management evaluates segment
performance based on segment operating income.

                                       70
<PAGE>

         Information on the Company's two operating segments, the FSG and the
ETG, for each of the fiscal years ended October 31 is as follows:

<TABLE>
<CAPTION>
                                                                                Other,
                                                                               Primarily
                                                                             Corporate and     Consolidated
                                               FSG              ETG          Intersegment         Totals
                                            ------------     ------------    -------------     -------------
<S>                                         <C>              <C>              <C>               <C>
For the year ended October 31, 2008:
------------------------------------
   Net sales                                $436,810,000     $146,044,000       ($507,000)      $582,347,000
   Depreciation and amortization               9,339,000        5,238,000         475,000         15,052,000
   Operating income                           81,184,000       38,775,000     (14,171,000)       105,788,000
   Capital expenditures                       10,735,000        2,093,000         627,000         13,455,000
   Total assets                              418,079,000      220,888,000      37,575,000        676,542,000

For the year ended October 31, 2007:
------------------------------------
   Net sales                                $383,911,000     $124,035,000        ($22,000)      $507,924,000
   Depreciation and amortization               8,047,000        3,786,000         334,000         12,167,000
   Operating income                           67,408,000       33,870,000     (15,264,000)        86,014,000
   Capital expenditures                       10,146,000        2,300,000         440,000         12,886,000
   Total assets                              379,433,000      230,448,000      21,421,000        631,302,000

For the year ended October 31, 2006:
------------------------------------
   Net sales                                $277,255,000     $115,021,000        ($86,000)      $392,190,000
   Depreciation and amortization               6,822,000        3,437,000         306,000         10,565,000
   Operating income                           46,840,000       34,026,000     (13,999,000)        66,867,000
   Capital expenditures                        8,189,000        1,607,000         168,000          9,964,000
   Total assets                              337,020,000      180,359,000      17,436,000        534,815,000
</TABLE>

Major Customer and Geographic Information

         No one customer accounted for 10% or more of the Company's consolidated
net sales during the last three fiscal years. The Company's net sales
originating and long-lived assets held outside of the United States during each
of the last three fiscal years were not material.

         The Company markets its products and services in over 100 countries.
Other than in the United States, the Company does not conduct business in any
other country in which its sales in that country exceed 10% of consolidated
sales. Sales are attributed to countries based on the location of customers. The
composition of the Company's sales to customers between those in the United
States and those in other locations for each of the three fiscal years ended
October 31 as follows:

<TABLE>
<CAPTION>
                                           For the year ended October 31,
                              --------------------------------------------------
                                  2008               2007               2006
                              ------------       ------------       ------------
<S>                           <C>                <C>                <C>
United States                 $400,447,000       $365,588,000       $284,048,000
Other                          181,900,000        142,336,000        108,142,000
                              ------------       ------------       ------------
Total                         $582,347,000       $507,924,000       $392,190,000
                              ============       ============       ============
</TABLE>

                                       71
<PAGE>

14. COMMITMENTS AND CONTINGENCIES

Lease Commitments

         The Company leases certain property and equipment, including
manufacturing facilities and office equipment under operating leases. Some of
these leases provide the Company with the option after the initial lease term
either to purchase the property at the then fair market value or renew the lease
at the then fair rental value. Generally, management expects that leases will be
renewed or replaced by other leases in the normal course of business.

        Minimum payments for operating leases having initial or remaining
non-cancelable terms in excess of one year are as follows:

              For the year ending October 31,
              2009................................    $5,749,000
              2010................................     5,487,000
              2011................................     4,592,000
              2012................................     4,040,000
              2013................................     3,260,000
              Thereafter .........................     9,065,000
                                                     -----------
              Total minimum lease commitments ....   $32,193,000
                                                     ===========

         Total rent expense charged to operations for operating leases in fiscal
2008, 2007 and 2006 amounted to $6,074,000, $4,221,000 and $3,409,000,
respectively.

Guarantees

        The Company has arranged for standby letters of credit aggregating $1.4
million to meet the security requirement of its insurance company for potential
workers' compensation claims, which are supported by the Company's revolving
credit facility.

Product Warranty

        Changes in the Company's product warranty liability for fiscal 2008 and
2007 are as follows:

              Balance as of October 31, 2006            $534,000
              Acquired warranty liabilities               52,000
              Accruals for warranties                  1,451,000
              Warranty claims settled                   (856,000)
                                                      ----------
              Balance as of October 31, 2007           1,181,000
              Accruals for warranties                  1,201,000
              Warranty claims settled                 (1,711,000)
                                                      ----------
              Balance as of October 31, 2008            $671,000
                                                      ==========

Acquisitions

Put/Call Rights

         Pursuant to the purchase agreement related to the acquisition of an 80%
interest in a subsidiary by the FSG in fiscal 2001, the Company acquired an
additional 10% of the equity interests of the subsidiary in fiscal 2007. The
Company has provided notice to the minority interest holder that it will
purchase the

                                       72
<PAGE>

remaining 10% interest effective October 31, 2008. Accordingly, the Company
accrued $1.2 million as of October 31, 2008 related to the purchase of this
equity interest, which was paid in December 2008.

         As part of the agreement to acquire an 80% interest in a subsidiary by
the ETG in fiscal 2004, the Company has the right to purchase the minority
interests over a five-year period beginning at approximately the tenth
anniversary of the acquisition, or sooner under certain conditions, and the
minority interest holders have the right to cause the Company to purchase their
interests over a five-year period commencing on approximately the fifth
anniversary of the acquisition, or sooner under certain conditions.

         Pursuant to the purchase agreement related to the acquisition of a 85%
interest in a subsidiary by the ETG in fiscal 2005, certain minority interest
holders exercised their option during fiscal 2007 to cause the Company to
purchase their aggregate 3% interest over a four-year period ending in fiscal
2010. Accordingly, the Company increased its ownership interest in the
subsidiary by 1.5% (or one-fourth of such minority interest holders' aggregate
interest in fiscal 2007 and 2008, respectively) to 86.5% effective April 2008.
Further, the remaining minority interest holders currently have the right to
cause the Company to purchase their aggregate 12% interest over a four-year
period.

         Pursuant to the purchase agreement related to the acquisition of a 51%
interest in a subsidiary by the FSG in fiscal 2006, the minority interest
holders exercised their option during fiscal 2008 to cause the Company to
purchase an aggregate 28% interest over a four-year period ending in fiscal
2011. Accordingly, the Company increased its ownership interest in the
subsidiary by 7% (or one-fourth of such minority interest holders' aggregate
interest) to 58% effective April 2008. In December 2008, the Company and the
minority interest holders agreed to accelerate the purchase of 14% of these
equity interests (7% from April 2009 and 7% from April 2010) to December 2008.
The estimated purchase price of this 14% interest is $9.3 million (see Note 16,
Subsequent Event, of the Notes to Consolidated Financial Statements). Further,
the Company has the right to purchase the remaining 21% of the equity interests
of the subsidiary over a three-year period beginning approximately after the
fourth anniversary of the acquisition, or sooner under certain conditions, and
the minority interest holders have the right to cause the Company to purchase
the same equity interest over the same period.

         As part of the agreement to acquire an 80% interest in a subsidiary by
the FSG in fiscal 2006, the Company has the right to purchase the minority
interests over a four-year period beginning at approximately the eighth
anniversary of the acquisition, or sooner under certain conditions, and the
minority interest holders have the right to cause the Company to purchase the
same equity interest over the same period.

         As part of an agreement to acquire an 80% interest in a subsidiary by
the FSG in fiscal 2008, the Company has the right to purchase the minority
interests over a five-year period beginning at approximately the sixth
anniversary of the acquisition, or sooner under certain conditions, and the
minority interest holders have the right to cause the Company to purchase the
same equity interest over the same period.

         The above referenced rights of the minority interest holders ("Put
Rights") may be exercised on varying dates causing the Company to purchase their
equity interests beginning in fiscal 2009 through fiscal 2018. The Put Rights,
all of which relate either to common shares or membership interests in limited
liability companies, provide that the cash consideration to be paid for the
minority interests ("Redemption Amount") be at a formula that management
intended to reasonably approximate fair value, as defined in the applicable
agreements based on a multiple of future earnings over a measurement period.
Assuming the subsidiaries perform over their respective future measurement
periods at the same earnings levels they performed in the comparable historical
measurement periods and assuming all Put Rights are

                                       73
<PAGE>

exercised, the aggregate Redemption Amount that the Company would be required to
pay is approximately $49 million (which excludes the aforementioned $1.2 million
accrued as of October 31, 2008). The actual Redemption Amount will likely be
different. Upon exercise of any Put Right, the Company's ownership interest in
the subsidiary would increase and minority interest expense would decrease. The
Put Rights are embedded in the shares owned by the minority interest holders and
are not freestanding. Consistent with Accounting Research Bulletin No. 51,
"Consolidated Financial Statements," minority interests have been recorded on
the Company's consolidated balance sheets at historical cost plus an allocation
of subsidiary earnings based on ownership interests, less dividends paid to the
minority interest holders. As described in Note 1, Summary of Significant
Accounting Policies, of the Notes to Consolidated Financial Statements, the FASB
issued SFAS No. 160 in December 2007 that will change the current accounting and
financial reporting for non-controlling (minority) interests. SFAS No. 160 will
be effective for fiscal years beginning after December 15, 2008. The Company
will adopt SFAS No. 160 on November 1, 2009. SFAS No. 160 will require that
non-controlling (minority) interests be reported in the consolidated balance
sheet within equity. The Company is not yet in a position to assess the full
impact and related disclosure of adopting SFAS No. 160 on its minority interest
liabilities and related Put Rights.

Additional Contingent Purchase Consideration

         As part of the agreement to purchase a subsidiary by the ETG in fiscal
2005, the Company may be obligated to pay additional purchase consideration
currently estimated to total up to $2.7 million should the subsidiary meet
certain product line-related earnings objectives during the fourth and fifth
years following the acquisition.

         As part of the agreement to acquire a subsidiary by the ETG in fiscal
2006, the Company may be obligated to pay additional purchase consideration up
to $19.2 million based on the subsidiary's fiscal 2009 earnings relative to
target.

         As part of the agreement to acquire a subsidiary by the ETG in fiscal
2007, the Company may be obligated to pay additional purchase consideration up
to 73 million Canadian dollars in aggregate, which translates to $59.7 million
U.S. dollars based on the October 31, 2008 exchange rate, should the subsidiary
meet certain earnings objectives during the first five years following the
acquisition.

         As part of the agreement to acquire a subsidiary by the FSG in fiscal
2008, the Company may be obligated to pay additional consideration of up to
approximately $.4 million in aggregate should the subsidiary meet certain
earnings objectives during the third, fourth and fifth years following the
acquisition.

         The above referenced additional contingent purchase consideration will
be accrued when the earnings objectives are met. Such additional contingent
consideration is based on a multiple of earnings above a threshold (subject to
a cap in certain cases) and is not contingent upon the former shareholders of
the acquired entities remaining employed by the Company or providing future
services to the Company. Accordingly, such consideration will be recorded as an
additional cost of the respective acquired entity when paid. The maximum amount
of such contingent consideration that the Company could be required to pay
aggregates approximately $82 million payable over the future periods beginning
in fiscal 2010 through fiscal 2013. Assuming the subsidiaries perform over their
respective future measurement periods at the same earnings levels they performed
in the comparable historical measurement periods, the aggregate amount of such
contingent consideration that the Company would be required to pay is
approximately $5 million. The actual contingent purchase consideration will
likely be different.

                                       74
<PAGE>

Litigation

         The Company is involved in various legal actions arising in the normal
course of business. Based upon the Company's and its legal counsel's
evaluations of any claims or assessments, management is of the opinion that the
outcome of these matters will not have a material adverse effect on the
Company's results of operations, financial position or cash flows.

15. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

         Cash paid for interest was $2,443,000, $3,287,000 and $3,459,000 in
fiscal 2008, 2007 and 2006, respectively. Cash paid for income taxes was
$26,669,000, $16,572,000 and $15,823,000 in fiscal 2008, 2007 and 2006,
respectively. Cash received from income tax refunds in fiscal 2008, 2007 and
2006 was $29,000, $243,000 and $51,000 respectively.

         Cash investing activities related to acquisitions, including contingent
purchase price payments to previous owners of acquired businesses, is as
follows:

<TABLE>
<CAPTION>
                                                                       For the year ended October 31,
                                                                --------------------------------------------
                                                                    2008            2007            2006
                                                                ------------    ------------    ------------
<S>                                                             <C>             <C>             <C>
Fair value of assets acquired:
    Liabilities assumed                                           $1,581,000      $7,460,000     $13,937,000
    Minority interests in consolidated subsidiaries                 (412,000)       (412,000)      6,301,000
    Less:
      Goodwill                                                     9,685,000      22,296,000      19,707,000
      Identifiable intangible assets                               3,991,000      15,902,000      19,640,000
      Accrued additional purchase consideration                   11,736,000       7,180,000       3,045,000
      Inventories, net                                             1,252,000       3,539,000      21,342,000
      Accounts receivable, net                                     2,045,000       2,569,000      12,213,000
      Property, plant and equipment                                1,394,000       2,142,000         690,000
      Other assets                                                   104,000       1,787,000       1,718,000
                                                                ------------    ------------    ------------
    Acquisitions and related costs, net of cash acquired        ($29,038,000)   ($48,367,000)   ($58,117,000)
                                                                ============    ============    ============
</TABLE>

         In connection with certain acquisitions, the Company accrued additional
purchase consideration aggregating $3.4 million, $11.7 million and $7.2 million
in fiscal 2008, 2007 and 2006, respectively, which was allocated to goodwill
(see Note 2, Acquisitions, and Note 4, Goodwill and Other Intangible Assets, of
the Notes to Consolidated Financial Statements).

         There were no significant capital lease and/or other equipment
financing activities during fiscal 2008, 2007 or 2006.

16. SUBSEQUENT EVENT

         Pursuant to the agreement to acquire a 51% interest in a subsidiary by
the Flight Support Group in fiscal 2006, the minority interest holders exercised
their option during fiscal 2008 to cause the Company to purchase their aggregate
28% interest over a four-year period ending in fiscal 2011. In December 2008,
the Company and the minority interest holders agreed to accelerate the purchase
of 14% of these equity interests (7% from April 2009 and 7% from April 2010) to
December 2008. The estimated purchase price of this 14% interest is $9.3
million. The remaining 7% interest is anticipated to be purchased in April 2011.

                                       75
<PAGE>

Item 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

         Not applicable.

Item 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

         The Company's Chief Executive Officer and its Chief Financial Officer
conducted an evaluation of the effectiveness of the Company's disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) as of the end of the period covered by this Annual Report on Form
10-K. Based upon that evaluation, the Company's Chief Executive Officer and its
Chief Financial Officer concluded that the Company's disclosure controls and
procedures are effective.

Management's Report on Internal Control Over Financial Reporting

         Management of HEICO Corporation is responsible for establishing and
maintaining adequate internal control over financial reporting. Internal control
over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles. A company's internal control over financial reporting
includes those policies and procedures that (i) pertain to the maintenance of
records that in reasonable detail accurately and fairly reflect the transactions
and dispositions of the assets of the Company; (ii) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that
receipts and expenditures of the Company are being made only in accordance with
authorizations of management and directors of the Company; and (iii) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Company's assets that could have a
material effect on the financial statements.

         Because of inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Projections of any evaluation
of effectiveness to future periods are subject to the risks that controls may
become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.

         Management, under the supervision of and with the participation of the
Company's Chief Executive Officer and the Chief Financial Officer, assessed the
effectiveness of the Company's internal control over financial reporting based
on the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission in Internal Control-Integrated Framework. Based on its
assessment, management believes that the Company's internal control over
financial reporting is effective as of October 31, 2008.

         Deloitte & Touche LLP, an independent registered public accounting
firm, has audited the Company's consolidated financial statements and the
effectiveness of internal controls over financial reporting as of October 31,
2008 as stated in their report included in Item 8, Financial Statements and
Supplementary Data, of this Annual Report on Form 10-K.

                                       76
<PAGE>

Changes in Internal Control Over Financial Reporting

         The Company is continuously seeking to improve the efficiency and
effectiveness of its operations and of its internal controls. This results in
refinements to processes throughout the Company. However, there have been no
changes in the Company's internal control over financial reporting that
occurred during the Company's most recent fiscal quarter that have materially
affected, or are reasonably likely to materially affect, the Company's internal
control over financial reporting.

Item 9B. OTHER INFORMATION

         Not applicable.

                                       77
<PAGE>

                                    PART III

Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

         Information concerning the Directors of the Company, including the
Finance/Audit Committee of the Board of Directors and its Finance/Audit
Committee Financial Expert, as well as information concerning compliance with
Section 16(a) of the Securities Exchange Act of 1934 is hereby incorporated by
reference to the Company's definitive proxy statement, which will be filed with
the Securities and Exchange Commission ("Commission") within 120 days after the
close of fiscal 2008.

         Information concerning the Executive Officers of the Company is set
forth in Item 1 of Part I hereof under the caption "Executive Officers of the
Registrant."

         The Company has adopted a code of ethics that applies to its principal
executive officer, principal financial officer, principal accounting officer or
controller and persons performing similar functions. The code of ethics is
located on the Company's Internet web site at http://www.heico.com. Any
amendments to or waivers from a provision of this code of ethics will be posted
on the Company's web site.

Item 11. EXECUTIVE COMPENSATION

         Information concerning executive compensation is hereby incorporated by
reference to the Company's definitive proxy statement, which will be filed with
the Commission within 120 days after the close of fiscal 2008.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS

         Information concerning security ownership of certain beneficial owners
and management is hereby incorporated by reference to the Company's definitive
proxy statement, which will be filed with the Commission within 120 days after
the close of fiscal 2008.

         Equity compensation plan information is set forth in Item 5 of Part II
hereof under the caption "Equity Compensation Plan Information."

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
         INDEPENDENCE

         Information concerning certain relationships and related transactions
and director independence is hereby incorporated by reference to the Company's
definitive proxy statement, which will be filed with the Commission within 120
days after the close of fiscal 2008.

Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

         Information concerning the principal accountant's fees and services is
hereby incorporated by reference to the Company's definitive proxy statement,
which will be filed with the Commission within 120 days after the close of
fiscal 2008.

                                       78
<PAGE>

                                     PART IV

Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)(1)  Financial Statements

        The following consolidated financial statements of the Company and
subsidiaries are included in Part II, Item 8:

                                                                            Page
                                                                            ----
Report of Independent Registered Public Accounting Firm .................... 41
Consolidated Balance Sheets as of October 31, 2008 and 2007 ................ 43
Consolidated Statements of Operations for the years ended
     October 31, 2008, 2007 and 2006 ....................................... 44
Consolidated Statements of Shareholders' Equity and Comprehensive Income
     for the years ended October 31, 2008, 2007 and 2006 ................... 45
Consolidated Statements of Cash Flows for the years ended
     October 31, 2008, 2007 and 2006 ....................................... 46
Notes to Consolidated Financial Statements ................................. 47

(a)(2)  Financial Statement Schedules

        The following financial statement schedule of the Company and
subsidiaries is included herein:

   o    Schedule II - Valuation and Qualifying Accounts

        All other schedules have been omitted because the required information
is not applicable or the information is included in the consolidated financial
statements or notes thereto presented in Part II, Item 8.

(a)(3)  Exhibits

Exhibit                 Description
-------                 -----------
  2.1         --        Amended and Restated Agreement of Merger and Plan of
                        Reorganization, dated as of March 22, 1993, by and
                        among HEICO Corporation, HEICO Industries, Corp. and
                        New HEICO, Inc. is incorporated by reference to Exhibit
                        2.1 to the Registrant's Registration Statement on Form
                        S-4 (Registration No. 33-57624) Amendment No. 1 filed
                        on March 19, 1993.*

  3.1         --        Articles of Incorporation of the Registrant are
                        incorporated by reference to Exhibit 3.1 to the
                        Company's Registration Statement on Form S-4
                        (Registration No. 33-57624) Amendment No. 1 filed on
                        March 19, 1993.*

  3.2         --        Articles of Amendment of the Articles of Incorporation
                        of the Registrant, dated April 27, 1993, are
                        incorporated by reference to Exhibit 3.2 to the
                        Company's Registration Statement on Form 8-B dated
                        April 29, 1993.*

  3.3         --        Articles of Amendment of the Articles of Incorporation
                        of the Registrant, dated November 3, 1993, are
                        incorporated by reference to Exhibit 3.3 to the
                        Form 10-K for the year ended October 31, 1993.*

                                       79
<PAGE>

Exhibit                 Description
-------                 -----------

  3.4         --        Articles of Amendment of the Articles of Incorporation
                        of the Registrant, dated March 19, 1998, are
                        incorporated by reference to Exhibit 3.4 to the
                        Company's Registration Statement on Form S-3
                        (Registration No. 333-48439) filed on March 23, 1998.*

  3.5         --        Articles of Amendment of the Articles of Incorporation
                        of the Registrant, dated as of November 2, 2003, are
                        incorporated by reference to Exhibit 3.5 to the
                        Form 10-K for the year ended October 31, 2003.*

  3.6         --        Bylaws of the Registrant are incorporated by reference
                        to Exhibit 3.1 to the Form 8-K filed on December 19,
                        2007.*

  4.0         --        The description and terms of the Preferred Stock
                        Purchase Rights are set forth in a Rights Agreement
                        between the Company and SunTrust Bank, N.A., as Rights
                        Agent, dated as of November 2, 2003, incorporated by
                        reference to Exhibit 4.0 to the Form 8-K dated
                        November 2, 2003.*

 10.1#        --        HEICO Savings and Investment Plan, as amended and
                        restated effective as of January 1, 2007 is
                        incorporated by reference to Exhibit 10.1 to the Form
                        10-Q for the quarterly period ended January 31, 2008.*

 10.2#        --        First Amendment, effective as of January 1, 2007, to the
                        HEICO Savings and Investment Plan.**

 10.3#        --        Second Amendment, effective as of January 1, 2009, to
                        the HEICO Savings and Investment Plan.**

 10.4#        --        Non-Qualified Stock Option Agreement for Directors,
                        Officers and Employees is incorporated by reference to
                        Exhibit 10.8 to the Form 10-K for the year ended
                        October 31, 1985.*

 10.5#        --        HEICO Corporation 1993 Stock Option Plan, as amended, is
                        incorporated by reference to Exhibit 4.7 to the
                        Company's Registration Statement on Form S-8
                        (Registration No. 333-81789) filed on June 29, 1999.*

 10.6#        --        HEICO Corporation 2002 Stock Option Plan, effective
                        March 19, 2002, is incorporated by reference to Exhibit
                        10.10 to the Form 10-K for the year ended October 31,
                        2002.*

 10.7#        --        HEICO Corporation Amended and Restated 2002 Stock Option
                        Plan, effective March 28, 2008, is incorporated by
                        reference to Appendix A to the Form DEF-14A filed on
                        February 28, 2008.*

 10.8#        --        HEICO Corporation Directors' Retirement Plan, as
                        amended, dated as of May 31, 1991, is incorporated by
                        reference to Exhibit 10.19 to the Form 10-K for the
                        year ended October 31, 1992.*

 10.9#        --        Key Employee Termination Agreement, dated as of April 5,
                        1988, between HEICO Corporation and Thomas S. Irwin is
                        incorporated by reference to Exhibit 10.20 to the Form
                        10-K for the year ended October 31, 1992.*

 10.10#       --        HEICO Corporation Leadership Compensation Plan,
                        effective October 1, 2006, is incorporated by reference
                        to Exhibit 10.1 to the Form 8-K filed on October 31,
                        2006.*

                                       80
<PAGE>

Exhibit                 Description
-------                 -----------

 10.11#       --        HEICO Corporation Leadership Compensation Plan,
                        effective October 1, 2006, as Amended and Restated
                        effective January 1, 2009, is incorporated by
                        reference to Exhibit 10.1 to the Form 8-K filed on
                        December 16, 2008.*

 10.12#       --        HEICO Corporation 2007 Incentive Compensation Plan,
                        effective as of November 1, 2006, is incorporated by
                        reference to Exhibit 10.1 to the Form 8-K filed on
                        March 19, 2007.*

 10.13        --        Shareholders Agreement, dated October 30, 1997, by and
                        between HEICO Aerospace Holdings Corp., HEICO Aerospace
                        Corporation and all of the shareholders of HEICO
                        Aerospace Holdings Corp. and Lufthansa Technik AG is
                        incorporated by reference to Exhibit 10.32 to Form
                        10-K/A for the year ended October 31, 1997.*

 10.14        --        Amended and Restated Revolving Credit Agreement, dated
                        as of August 4, 2005, among HEICO Corporation, as
                        Borrower, the lenders from time to time party hereto,
                        and SunTrust Bank, as Administrative Agent; Wachovia
                        Bank, National Association as Syndication Agent; and
                        HSBC Bank USA, as Documentation Agent, is incorporated
                        by reference to Exhibit 10.1 to the Form 8-K filed on
                        August 8, 2005.*

 10.15        --        First Amendment, effective as of July 14, 2006, to the
                        Amended and Restated Revolving Credit Agreement among
                        HEICO Corporation, as a Borrower, the lenders from time
                        to time party hereto, and SunTrust Bank, as
                        Administrative Agent; Wachovia Bank, National
                        Association as Syndication Agent; and HSBC Bank USA,
                        as Documentation Agent, is incorporated by reference to
                        Exhibit 10.1 to the Form 10-Q for the quarterly period
                        ended July 31, 2006.*

 10.16        --        Second Amended and Restated Revolving Credit Agreement,
                        dated as of May 27, 2008, among HEICO Corporation, as
                        Borrower, the lenders from time to time party hereto,
                        Regions Bank and Wells Fargo Bank, National
                        Association, as Co-Documentation Agents, JPMorgan
                        Chase Bank, N.A., as Syndication Agent, and SunTrust
                        Bank, as Administrative Agent, is incorporated by
                        reference to Exhibit 10.1 to the Form 8-K filed on May
                        30, 2008.*

 21           --        Subsidiaries of HEICO Corporation.**

 23           --        Consent of Independent Registered Public Accounting
                        Firm.**

 31.1         --        Rule 13a-14(a)/15d-14(a) Certification of Chief
                        Executive Officer.**

 31.2         --        Rule 13a-14(a)/15d-14(a) Certification of Chief
                        Financial Officer.**

 32.1         --        Section 1350 Certification of Chief Executive
                        Officer.***

 32.2         --        Section 1350 Certification of Chief Financial
                        Officer.***

----------

#        Management contract or compensatory plan or arrangement required to be
         filed as an exhibit.
*        Previously filed.
**       Filed herewith.
***      Furnished herewith.

                                       81
<PAGE>

                       HEICO CORPORATION AND SUBSIDIARIES
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
                                                                               For the year ended October 31,
                                                                          -------------------------------------------
                                                                             2008            2007             2006
                                                                          ----------      ----------       ----------
<S>                                                                       <C>             <C>              <C>
Allowance for doubtful accounts:
   Allowance as of beginning of year                                      $1,712,000      $2,893,000       $2,148,000
   Additions (deductions) charged (credited) to costs and expenses           872,000         (75,000)         653,000
   Additions charged to other accounts(a)                                     29,000           4,000          287,000
   Deductions(b)                                                             (26,000)     (1,110,000)        (195,000)
                                                                          ----------      ----------       ----------
   Allowance as of end of year                                            $2,587,000      $1,712,000       $2,893,000
                                                                          ==========      ==========       ==========
</TABLE>

(a) Principally additions from acquisitions.
(b) Principally write-offs of uncollectible accounts receivables, net of
    recoveries.

<TABLE>
<CAPTION>
                                                                                For the year ended October 31,
                                                                         --------------------------------------------
                                                                            2008            2007             2006
                                                                         -----------     -----------      -----------
<S>                                                                       <C>             <C>              <C>
Inventory valuation reserves:
   Reserves as of beginning of year                                      $27,141,000     $24,554,000      $16,488,000
   Additions charged to costs and expenses                                 1,808,000       2,035,000        3,521,000
   Additions charged to other accounts(a)                                    731,000       1,516,000        4,779,000
   Deductions(b)                                                          (2,494,000)       (964,000)        (234,000)
                                                                         -----------     -----------      -----------
   Reserves as of end of year                                            $27,186,000     $27,141,000      $24,554,000
                                                                         ===========     ===========      ===========
</TABLE>

(a) Principally additions from acquisitions.
(b) Principally write-offs of slow moving, obsolete or damaged inventory.

                                       82
<PAGE>

                                   SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                               HEICO CORPORATION

Date: December 24, 2008                        By:   /s/ THOMAS S. IRWIN
                                                  ------------------------------
                                                     Thomas S. Irwin
                                                     Executive Vice President
                                                     and Chief Financial Officer
                                                     (Principal Financial and
                                                     Accounting Officer)

        Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

  /s/ LAURANS A. MENDELSON                       Chairman, President,
  --------------------------------------------   Director (Principal
  Laurans A. Mendelson                           Executive Officer)

  /s/ SAMUEL L. HIGGINBOTTOM                     Director
  --------------------------------------------
  Samuel L. Higginbottom

  /s/ MARK H. HILDEBRANDT                        Director
  --------------------------------------------
  Mark H. Hildebrandt

  /s/ WOLFGANG MAYRHUBER                         Director
  --------------------------------------------
  Wolfgang Mayrhuber

  /s/ ERIC A. MENDELSON                          Director
  --------------------------------------------
  Eric A. Mendelson

  /s/ VICTOR H. MENDELSON                        Director
  --------------------------------------------
  Victor H. Mendelson

  /s/ ALBERT MORRISON, JR                        Director
  --------------------------------------------
  Albert Morrison, Jr.

  /s/ ALAN SCHRIESHEIM                           Director
  --------------------------------------------
  Alan Schriesheim

  /s/ FRANK J. SCHWITTER                         Director
  --------------------------------------------
  Frank J. Schwitter

                                       83
<PAGE>

                                  EXHIBIT INDEX

Exhibit                 Description
-------                 -----------

 10.2         --        First Amendment, effective as of January 1, 2007, to the
                        HEICO Savings and Investment Plan.

 10.3         --        Second Amendment, effective as of January 1, 2009, to
                        the HEICO Savings and Investment Plan.

 21           --        Subsidiaries of HEICO Corporation.

 23           --        Consent of Independent Registered Public Accounting
                        Firm.

 31.1         --        Rule 13a-14(a)/15d-14(a) Certification of Chief
                        Executive Officer.

 31.2         --        Rule 13a-14(a)/15d-14(a) Certification of Chief
                        Financial Officer.

 32.1         --        Section 1350 Certification of Chief Executive Officer.

 32.2         --        Section 1350 Certification of Chief Financial Officer.

                                       84