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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K
                                   -----------

                     ANNUAL REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended September 30, 1998   Commission file number 001-04021
                                                                      ---------
                              TRISTAR AEROSPACE CO.
             (Exact Name of Registrant as Specified in Its Charter)

             Delaware                                    75-2665751
(State of Other Jurisdiction of            (I.R.S. Employer Identification No.)
Incorporation or Organization)

          2527 Willowbrook Road                              75220
               Suite 200                                   (Zip Code)
         Dallas, Texas  75220
(Address of Principal Executive Offices)

       Registrant's Telephone Number, Including Area Code: (214) 366-5000

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                                                      Name Of Each Exchange
    Title Of Each Class                                On Which Registered
   ---------------------                              ----------------------
Common Stock $.01 par value                           New York Stock Exchange

        SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: None

     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 Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendments to
this Form 10-K.

     Aggregate market value of the voting stock held by nonaffiliates of the
registrant based on the closing price at which stock was sold on the New York
Stock Exchange on December 10, 1998, was approximately $74,759 million.

     The number of shares outstanding of each of the registrant's classes of
commons shares as of December 10, 1998, is as follows:

<TABLE>
<CAPTION>
                                                      Shares Outstanding
       Title Of Class                             As of December 10, 1998
       --------------                             -----------------------
      <S>                                        <C>
        Common Stock                                      17,044,742
</TABLE>

                       DOCUMENTS INCORPORATED BY REFERENCE

     Registrant intends to file with the Securities and Exchange Commission a
definitive Proxy Statement for the 1998 Annual Meeting of Stockholders to be
held on January 22, 1998, pursuant to Regulation 14A of the Securities Exchange
Act of 1934 within 120 days of the close of its fiscal year ended September 30,
1998, portions of which document are incorporated by reference in Part III
hereof.

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                               TABLE OF CONTENTS

<TABLE>
<CAPTION>

ITEM                                                                                        PAGE
----                                                                                        ----
<C>    <S>                                                                                 <C>
                                     PART I

 1.     Business........................................................................     3
 2.     Properties......................................................................     9
 3.     Legal Proceedings...............................................................     9
 4.     Submission of Matters to a Vote of Security Holders.............................     10

                                     PART II

 5.     Market for Registrant's Common Equity and Related Stockholder Matters...........     10
 6.     Selected Financial Data.........................................................     11
 7.     Management's Discussion and Analysis of Financial Condition and Results of
        Operations......................................................................     13
7A.     Quantitative and Quantitative Disclosures About Market Risk.....................     18
 8.     Financial Statements and Supplementary Data.....................................     19
 9.     Changes in and Disagreements with Accountants on Accounting and Financial
        Disclosure......................................................................     45

                                    PART III

 10     Director of Executive Officers of  the Registrant...............................     45
 11     Executive Compensation..........................................................     45
 12     Security Ownership of Certain Beneficial Owners and Management..................     45
 13     Certain Relationships and Related Transactions..................................     45

                                     PART IV

 14     Exhibits, Financial Statements, Schedules, and Reports on Form 8-K..............     45

        Signatures......................................................................     50

</TABLE>

                                    Page 2

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     STATEMENTS AND INFORMATION PRESENTED WITHIN THIS FORM 10-K FOR TRISTAR 
AEROSPACE CO.( THE "COMPANY") CONTAIN "FORWARD-LOOKING STATEMENTS" WITHIN THE 
MEANING OF SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. 
THESE FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF PREDICTIVE, 
FUTURE-TENSE OR FORWARD-LOOKING TERMINOLOGY, SUCH AS "BELIEVES," 
"ANTICIPATES," "EXPECTS," "ESTIMATES," "MAY," "WILL" OR SIMILAR TERMS. 
FORWARD-LOOKING STATEMENTS ALSO INCLUDE PROJECTIONS CONCERNING ANY 
ASSUMPTIONS RELATING TO THE FOREGOING. CERTAIN IMPORTANT FACTORS WHICH MAY 
CAUSE ACTUAL RESULTS TO VARY MATERIALLY FROM THESE FORWARD-LOOKING STATEMENTS 
ACCOMPANY SUCH STATEMENTS AND APPEAR ELSEWHERE IN THIS REPORT, INCLUDING 
WITHOUT LIMITATION, THE FACTORS DISCLOSED UNDER "RISK FACTORS". ALL 
SUBSEQUENT WRITTEN OR ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE 
COMPANY OR PERSONS ACTING ON ITS BEHALF ARE EXPRESSLY QUALIFIED BY THESE 
FACTORS.

                                     PART I

ITEM 1.   BUSINESS

     Unless the context otherwise requires, reference to the "Company" in this
form 10-K includes TriStar Aerospace Co. and its subsidiaries.

GENERAL

     The Company is both a leading distributor of aerospace fasteners, 
fastening systems and related hardware (collectively, "aerospace hardware") 
and a leading provider of customized inventory management services to 
original equipment manufacturers ("OEMs") of aircraft and aircraft 
components, to commercial airlines and to aircraft maintenance, repair and 
overhaul ("MRO") facilities, based on annual sales by the Company and its 
competitors in the aerospace hardware industry. While approximately 57% of 
the Company's revenues for fiscal 1998 were derived from traditional 
distribution sales and services ("conventional sales"), a substantial and 
growing percentage of the Company's revenues are derived from sales of 
aerospace hardware pursuant to long-term inventory management agreements 
under which TriStar performs a wide variety of value-added services (commonly 
referred to as "JIT services"). For fiscal 1998, JIT revenues represented 
approximately 43% of the Company's total revenues. The Company's JIT services 
are provided through comprehensive and flexible outsourcing programs under 
which the Company provides some or all of the material management functions 
necessary to procure and manage aerospace hardware for its customers. The 
Company derives income from its JIT services principally through margins 
earned on products sold under its JIT agreements. The Company believes that 
it was a pioneer of JIT services in the aerospace hardware industry and that 
today the Company is a leading provider of inventory management services to 
this industry. TriStar currently provides JIT services under long-term 
agreements to a number of leading aerospace and aircraft-related companies 
including, among others, Boeing (including former McDonnell Douglas and 
Rockwell International facilities), Northrop Grumman, Bell Helicopter, 
Raytheon Aircraft Company, Aerospatiale, Lockheed Martin, Gulfstream, United 
Airlines, British Airways and Federal Express. Through its JIT programs and 
conventional sales, the Company processed over 1,000,000 transactions 
involving over 89,000 stock keeping units ("SKUs") in fiscal 1998, resulting 
in approximately $185.9 million of sales to over 2,700 customers.

HISTORY OF THE COMPANY

     The Company was incorporated under the name "Maple Leaf Aerospace, Inc." 
in Delaware on August 21, 1996, by Odyssey Partners, L.P. ("Odyssey") to 
acquire the outstanding stock of Tri-Star Aerospace, Inc. (the "Predecessor") 
and certain net assets of the Aviall Aerospace business unit of Aviall 
Services, Inc. and of Aviall (Canada) Ltd. (together "Aviall Aerospace"). 
Founded in 1973, the Predecessor was a leading distributor of aerospace 
hardware products and a pioneer of JIT services in the aerospace hardware 
industry. The annual revenues of the Predecessor increased from $14.3 million 
in 1985 to 

                                    Page 3

<PAGE>

$65.6 million in 1995. In addition, as a result of its JIT programs, the 
Predecessor experienced revenue growth each year from 1990 through 1995, 
despite an economic downturn in the aerospace industry. Aviall Aerospace was 
a distributor of aerospace hardware to commercial and military aircraft OEMs. 
The acquisition of Aviall Aerospace provided the Company an expanded product 
line and access to a larger customer base. On February 24, 1998, the Company 
changed its name to "TriStar Aerospace Co."

     On May 5, 1998, the Company completed an initial public offering (the 
"Offering") of 13,276,858 shares of its common stock at a price of $16.00 per 
share. In addition, 224,776 shares were sold by certain shareholders pursuant 
to an over-allotment option in connection with the Offering. All of the 
shares offered were sold by certain shareholders of the Company. The Company 
did not receive any of the proceeds from the Offering.

AEROSPACE HARDWARE DISTRIBUTION SERVICES

     The Company's business can be separated into two broad categories: JIT
services and conventional sales, as discussed below.

JIT SERVICES

     Under the terms of its JIT agreements, the Company's personnel, 
processes and management information systems enable customers to outsource 
all or a portion of the planning, purchasing, receiving, documentation, 
inspection, storage, shipment and quality assurance functions associated with 
the procurement and management of aerospace hardware. The Company's 
substantial experience in developing and implementing JIT services enables it 
to create programs specifically tailored to the needs of its customers. In 
many cases, the Company assigns its own trained personnel to work on-site at 
the customer's facilities to place orders, monitor inventory bins and manage 
receipts. Under a typical JIT program, TriStar first analyzes the historical 
and projected usage patterns of the aerospace hardware parts included in the 
JIT agreement. The Company then establishes bar-coded inventory bins at the 
customer's manufacturing facility located at strategic points along the 
production line. If needed, the Company will establish a forward stocking 
location ("FSL ") near the customer's manufacturing facility which is stocked 
with the required aerospace hardware. TriStar representatives inspect the 
floor bins on a regular basis and scan those bins requiring replenishment 
using bar-code technology. This information is transferred via electronic 
data interchange ("EDI") to the Company's management information systems to 
determine restocking needs, update usage rates, assess adequacy of available 
stocks and calculate optimal reorder points. The Company's systems then 
create a replenishment order at the customer's FSL that results in delivery 
of the needed product to the customer's bins, usually within one working day. 
JIT agreements are either fixed price or fixed mark-up agreements and 
typically have a term of between three and five years. The Company's JIT 
sales were $79.5 million in fiscal 1998 or approximately 43% of total sales.

CONVENTIONAL SALES

     Conventional sales consist of providing customers with high-quality 
aerospace hardware at reasonable prices on an as-ordered basis. TriStar 
typically receives thousands of bid requests each month from large and small 
OEMs, airlines and MRO facilities. The key competitive factors which have an 
impact on conventional sales are: (i) availability of inventory, (ii) price 
and (iii) reputation for quality and reliability. Demand for conventional 
sales is generated by the inability of hardware manufacturers to quickly 
respond to changing customer demand due to their own capacity constraints and 
pricing strategies. Specifically, many manufacturers require long lead times 
(typically, 8-52 weeks) to provide products, even though the actual required 
production time is much shorter, due to queuing requirements and capacity 
issues. In addition, many manufacturers enforce minimum order quantities and 
set prices based on volume of purchases due to the efficiencies associated 
with long production runs. Therefore, unplanned demand or a long-term 
requirement for low volumes of a specific part make it advantageous for 
customers to purchase through distributors. The Company's strategically 
located facilities and the quality of its customer usage 

                                    Page 4

<PAGE>

information are key competitive advantages in the conventional sales market. 
These strengths allow the Company to place significant orders for products at 
advantageous prices and schedule deliveries to correspond with market demand. 
As a result, the Company can provide its customers with aerospace hardware on 
an as-ordered basis at prices generally below what they would pay by ordering 
small quantities directly from manufacturers. The Company's conventional 
sales were $106.4 million in fiscal 1998, or approximately 57% of total sales.

FOREIGN OPERATIONS

     The Company's operations are located primarily in North America and 
Europe. Export sales are made by U.S. businesses to customers in non-U.S. 
countries, whereas foreign sales are made by the Company's non-U.S. 
subsidiaries. For the Company's sales results by foreign sales and export 
sales, see Note 2 of the Company's Consolidated Financial Statements included 
in Item 8, Financial Statements and Supplementary Data.

CUSTOMERS

     The Company has over 2,700 customers, which include OEMs of aircraft and 
aircraft components, commercial airlines and MRO facilities. During fiscal 
1998, the Company's top ten customers accounted for approximately 58.3% of 
total sales, with Boeing (including former McDonnell Douglas and Rockwell 
International facilities) and Northrop Grumman accounting for approximately 
23.2% and 14.5% of total sales, respectively.

PRODUCTS

     TriStar stocks a wide variety of aerospace hardware ranging from small,
commodity hardware items such as washers and pins to larger, structural
fasteners and close-tolerance engineered fastening systems used throughout an
aircraft and its undercarriage. These products require sophisticated technology
and extensive testing to assure that they can endure the high speed stress loads
of the aircraft. The Company's major products include:

     -    High strength structural bolts and nuts.
     -    High strength/heat resistant engine bolts and nuts made from specialty
          materials.
     -    Screws and nut plates.
     -    Rivets (solid and blind).
     -    Specialty fasteners.
     -    Other products, including bearings, valves and safety hardware.

     The Company typically stocks approximately 100,000 SKUs to support its
customers' diverse aerospace hardware requirements.

SUPPLIERS

     TriStar purchases fastener products from a variety of manufacturers and is
an Authorized Distributor for over 65 suppliers, including Fairchild, Huck,
Kaynar, SPS and Hi-Shear. TriStar believes it is one of the largest customers of
most of these manufacturers. The Company's top 10 suppliers accounted for $43.6
million of TriStar's purchases in fiscal 1998, representing approximately 29% of
total purchases of $150.9 million.

                                    Page 5

<PAGE>

COMPETITION

     The aerospace hardware industry is fragmented, with numerous companies 
which manufacture and/or distribute fasteners, fastening systems and related 
components that compete with the products the Company distributes. 
Competition is generally based on product quality, including documentation, 
availability of inventory, reliability and price. Certain of these 
competitors have greater financial and other resources than the Company.

EMPLOYEES

     As of September 30, 1998, the Company employed 428 full-time employees. 
The Company is not a party to any collective bargaining agreements and 
management considers its employee relations to be good. None of the Company's 
employees are subject to a collective bargaining agreement.

ENVIRONMENTAL MATTERS

     There are no material expenditures anticipated for environmental control 
for fiscal 1999 and thereafter.

RISK FACTORS

     IN ADDITION TO OTHER INFORMATION IN THIS REPORT, THE FOLLOWING RISK 
FACTORS SHOULD BE CONSIDERED CAREFULLY IN EVALUATING THE COMPANY AND ITS 
BUSINESS. THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS WHICH INVOLVE RISKS 
AND UNCERTAINTIES. THE COMPANY'S ACTUAL RESULTS COULD DIFFER MATERIALLY FROM 
THOSE ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN 
FACTORS, INCLUDING THOSE SET FORTH IN THE FOLLOWING RISK FACTORS AND 
ELSEWHERE IN THIS REPORT.

     DEPENDENCE ON COMMERCIAL AIRCRAFT INDUSTRY. The worldwide commercial 
aircraft industry is the primary market for the products distributed and 
services provided by the Company. Historically, demand from this industry has 
been subject to cyclical fluctuations, with orders from OEMs and other 
customers for aerospace hardware typically increasing or decreasing in 
advance of corresponding changes in the deliveries of new aircraft. The 
demand for new aircraft historically has been closely related to the 
financial performance of airlines, which in turn has been closely related to 
general economic conditions and changes in business cycles. Changes in the 
commercial airline market resulting in a reduction in the rate of future 
aircraft deliveries, including cancellations or deferrals of scheduled 
deliveries, could have a material adverse effect on the Company's results of 
operations and financial condition.

     CUSTOMER CONCENTRATION; DEPENDENCE ON JIT AGREEMENTS. A significant 
portion of the Company's business is dependent upon a limited number of large 
manufacturers of commercial aircraft and defense products. Direct sales to 
Boeing and Northrop Grumman, for example, accounted for approximately 23.2% 
(including 11.3% from former McDonnell Douglas facilities and 7.6% from 
former Rockwell International facilities) and 14.5% of the Company's fiscal 
1998 net sales, respectively. In addition, under the terms of several of the 
Company's JIT agreements, the customer may terminate the agreement, subject 
to prior notice and/or other provisions, before the expiration of such 
agreement. The termination or renegotiation of any such agreement or the loss 
of one or more significant customers for any reason could have a material 
adverse effect on the Company's results of operations and financial 
condition. Furthermore, because of the relatively small number of customers 
for certain of the Company's products, such customers may be able to 
influence the Company's prices and other terms of sale with respect to such 
products.

     AVAILABILITY OF HARDWARE. As is customary in the aerospace hardware 
industry, the Company does not currently have long-term contracts with any of 
its suppliers. Any material disruption in the Company's sources of supply, 
particularly of the most commonly sold items, could have a material adverse 
effect upon the Company's results of operations and financial condition.

                                    Page 6

<PAGE>

     GROWTH STRATEGY IMPLEMENTATION; ABILITY TO MANAGE GROWTH. The Company's 
growth strategy includes (i) expanding its JIT services, (ii) expanding its 
presence in non-OEM segments of the marketplace, (iii) increasing its 
international business, (iv) further implementing supply chain management 
initiatives, and (v) exploring acquisition opportunities. The Company's 
ability to execute its growth strategy will depend on a number of factors, 
including existing and emerging competition, the ability to maintain profit 
margins in the face of competitive pressures, the continued recruitment, 
training and retention of employees, the strength of demand for its services 
and the availability of capital to support its growth.

     Conducting business outside of the United States is subject to various 
risks, including changing economic and political conditions in the United 
States and abroad, major work stoppages, currency fluctuations, armed 
conflicts and unexpected changes in United States and foreign laws relating 
to tariffs, exchange controls, trade restrictions, transportation 
regulations, foreign investments and taxation. The Company has no control 
over most of these risks and may be unable to anticipate changes in 
international economic and political conditions and, therefore, may be unable 
to alter its business practices in time to avoid the adverse effect of any 
such changes.

     From time to time, the Company may evaluate or pursue opportunistic 
acquisitions of all or portions of other independent aerospace hardware and 
service providers whose assets or product lines would complement or expand 
the Company's existing operations. There can be no assurance that the Company 
will succeed in identifying appropriate acquisition candidates, arranging 
financing for acquisitions, consummating acquisitions on satisfactory terms 
or efficiently integrating acquired businesses.

     To manage anticipated growth, the Company must continuously evaluate the 
adequacy of its existing resources, systems and processes, including, among 
others, its management resources, management information systems and 
financial and accounting systems. There can be no assurance that management 
will adequately anticipate all of the changing demands that growth will 
impose on the Company's resources, systems and processes. Any failure to 
adequately anticipate and respond to such changing demands could have a 
material adverse effect on the Company's growth strategy. Any such adverse 
effect could result in the Company's growth and anticipated results of 
operations being less than management's expectations.

     FLUCTUATIONS IN OPERATING RESULTS. The Company's operating results are 
affected by many factors, including the timing of orders from large 
customers, the timing of expenditures for employees hired in anticipation of 
future sales and the mix of customers purchasing products in a particular 
period. Any of these factors, or any cancellations, reductions or delays in 
orders by a significant customer or group of customers, could have a material 
adverse effect on the Company's results of operations and financial condition.

     DEPENDENCE ON KEY PERSONNEL. The continued success of the Company is 
dependent to a significant degree upon the services of its executive officers 
and upon the Company's ability to attract and retain qualified personnel 
experienced in the various phases of the Company's business. Loss of the 
services of such employees, particularly Quentin Bourjeaurd, President and 
Chief Executive Officer of the Company, Charles Balchunas, Chief Operating 
Officer of the Company, Doug Childress, Chief Financial Officer of the 
Company, Trevor Wright, Executive Vice President of Sales and Marketing and 
Denny Barge, Vice President of Operations and Strategic Planning, could 
adversely affect the operations of the Company. The Company has entered into 
executive employment agreements with a number of its key personnel, including 
Messrs. Bourjeaurd, Balchunas, Childress, Wright and Barge. See "Compensation 
of Executive Officers-Employment Agreements" set forth in the Company's 
definitive Proxy statement to be filed in connection with the 1999 Annual 
Meeting to be held on January 22, 1999 and which is incorporated herein by 
reference. The Company does not maintain key man life insurance on the lives 
of any of its executive officers or key employees.

                                    Page 7

<PAGE>

     COMPETITION. Numerous companies manufacture and/or distribute fasteners, 
fastening systems and related components that compete with the products the 
Company distributes. Certain of these competitors have greater financial 
resources than the Company. There can be no assurance that competitive 
pressures in any of the markets to which the Company distributes products 
will not have a material adverse effect on the Company's results of 
operations and financial condition. See "Business-Competition."

     DEPENDENCE ON MANAGEMENT INFORMATION SYSTEMS; YEAR 2000 COMPLIANCE. The 
Company believes that the successful operation of the Company's business is 
dependent in part on its computerized inventory management, order processing 
and distribution systems and other computer software programs and operating 
systems. These systems will require modification, improvement or replacement 
as the Company grows. The Company may, from time to time, experience delays, 
complications or expenses in integrating and operating these systems, any of 
which could have a material adverse effect upon the Company's results of 
operations and financial condition.

     The Company has evaluated its primary computer software programs and 
operating systems used for business processes to identify any as to which 
there may be a "Year 2000" issue and is currently taking steps to modify or 
replace its systems that are not Year 2000 compliant. While the Company 
believes that it will be able to achieve such Year 2000 compliance through a 
combination of modification and/or replacement of its existing programs and 
systems, no assurance can be given that these efforts will be successful or 
that such efforts will be completed on a timely basis. The failure to 
successfully complete such implementation on a timely basis and the failure 
of third parties who have a significant relationship with the Company to 
timely complete Year 2000 changes may cause interruptions in operations which 
could have a material adverse effect on the Company's results of operations 
and financial condition. See "Management's Discussion and Analysis of 
Financial Condition and Results of Operations-Year 2000 Compliance."

     PRODUCT LIABILITY; CLAIMS EXPOSURE. The nature of the products 
distributed by the Company exposes it to potential liabilities resulting from 
the failure of an airframe, aircraft engine or other aircraft part 
manufactured with aerospace hardware supplied by the Company. The Company 
maintains product liability insurance to protect it from such liabilities; 
however, no assurance can be given that claims will not arise in the future 
or that such insurance coverage will be adequate. Additionally, there can be 
no assurance that insurance coverage can be maintained in the future at an 
acceptable cost. Any such liability not covered by insurance, or for which 
third party indemnification is not available, could have a material adverse 
effect on the Company's results of operations and financial condition. See 
"Business-Legal Proceedings."

     GOVERNMENT REGULATION. While the Company's business is not currently 
regulated, the aerospace hardware it distributes must be accompanied by 
documentation which enables its customers to comply with applicable 
regulatory requirements. There can be no assurance that new and more 
stringent government regulations will not be adopted in the future or that 
any such new regulations, if enacted, would not have a material adverse 
effect on the Company's results of operations and financial condition.

     EMPLOYEE RELATIONS. Although none of the Company's employees is subject 
to a collective bargaining agreement, the Company may be subject to future 
unionization efforts. The unionization of the Company's workforce could 
result in higher employee compensation and working condition demands that 
could increase the Company's operating costs or constrain its operating 
flexibility. See "Business-Employees."

     CERTAIN CHARTER, BYLAW AND STATUTORY ANTI-TAKEOVER PROVISIONS. The 
Company's Amended and Restated Certificate of Incorporation (the 
"Certificate") and Bylaws provide for a classified Board of Directors, 
restrict the ability of stockholders to call special meetings or take 
stockholder action by written consent, and contain advance notice 
requirements for stockholder proposals and nominations and special voting 
requirements for the amendment of the Certificate and Bylaws. These 
provisions could delay or hinder the removal of incumbent directors and could 
discourage or make more difficult a proposed merger,

                                    Page 8

<PAGE>

tender offer or proxy contest involving the Company or may otherwise have an 
adverse effect on the market price of the common stock of the Company. The 
Company also will be subject to provisions of Delaware corporate law that 
will restrict the Company from engaging in certain business combinations with 
an interested stockholder, unless certain conditions are met or the business 
combination is approved by the Company's Board of Directors and/or 
stockholders in a prescribed manner. These provisions also could render more 
difficult or discourage a merger, tender offer or other similar transaction.

     The Certificate authorizes the issuance of 10,000,000 shares of 
preferred stock, none of which is currently outstanding. Shares of preferred 
stock may be issued on such terms as the Company's Board of Directors may 
determine. The rights of the holders of the Company's common stock will be 
subject to, and may be adversely affected by, any preferred stock that may be 
issued in the future. The issuance of preferred stock, while providing 
desirable flexibility in connection with possible acquisitions, financings 
and other corporate transactions, could have the effect of discouraging, or 
making more difficult, a third party's acquisition of a majority of the 
Company's outstanding voting stock. The Company has no plans to issue any 
shares of preferred stock.

ITEM 2.   PROPERTIES

     The Company's executive offices are located in Dallas, Texas. The 
Company considers its properties to be well-maintained and adequate for its 
current operations. All of the Company's properties are leased.

     The following table identifies the principal properties utilized by the 
Company.

<TABLE>
<CAPTION>

                                                                          SQUARE        EXPIRATION
   FACILITY DESCRIPTION                        LOCATION                   FOOTAGE          DATE
   --------------------                        --------                   -------       ----------
  <S>                                         <C>                        <C>           <C>
   Corporate Headquarters and Central
       Warehouse                               Dallas, TX                  77,554        9-30-1999
   Sales Office and Central Warehouse          Tulsa, OK                   53,588        8-31-2000
   Sales Office and Warehouse                  Deerfield Beach, FL         20,520       12-31-1999
   Sales Office and Warehouse                  Long Beach, CA              19,878        4-30-2000
   Warehouse                                   Bridgeton, MO               16,500        2-29-2000
   Warehouse                                   Augusta, KS                 10,000       12-14-1998
   Sales Office and Warehouse                  Mississauga, Ontario         7,871        4-30-2003
   Warehouse                                   Greenville, SC               5,000        8-31-1999
   Sales Office and Warehouse                  Toulouse, France            10,764        6-14-2007
   Sales Office and Warehouse                  Lachine, Quebec              4,268        7-31-1998
   Sales Office and Warehouse                  London, England              3,906       12-31-2010
   Sales Office and Warehouse                  Macon, GA                    3,750        3-31-2001
   Sales Office                                Auburn, WA                   2,640        4-30-2002
   Sales Office                                Fort Worth, TX               2,250        3-31-2000
   Sales Office                                Sherman Oaks, CA             1,776       10-15-2003
   Sales Office                                Cornwall, NY                 1,300         2-2-2000

</TABLE>

ITEM 3.   LEGAL PROCEEDINGS

     The Company currently provides no express warranties as to the 
performance of the products it distributes pursuant to its conventional 
sales. Although the Company's JIT agreements typically provide express 
warranties that the products sold thereunder are free from defects, comply 
with applicable specifications and are fit for the use intended, the Company 
has not, to date, experienced material claims with respect to such 
warranties. However, the nature of the Company's business exposes it to 
possible 

                                    Page 9

<PAGE>

claims for personal injury or death which may result from a failure of 
aerospace hardware distributed by it. The Company maintains what it believes 
is adequate product liability insurance to protect it from such claims.

     The Company is not presently involved in any material legal proceedings.
From time to time the Company may be named as a defendant in suits for product
defects, breach of implied warranty of merchantability, or other actions
relating to products which it distributes which are manufactured by others. The
Company believes that this exposure is adequately covered by its product
liability insurance and/or third party indemnification.

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 the fiscal year covered by this report.

                                     PART II

ITEM 5.   MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

PRICE RANGE OF COMMON STOCK

     The Company's common stock trades on the New York Stock Exchange ("NYSE")
under the symbol "TSX". The following table sets forth the quarterly high and
low sales prices as reported by the NYSE composite transactions for the third
and fourth quarters for fiscal 1998, which ended subsequent to the Company's
Offering.

<TABLE>
<CAPTION>

                                FISCAL 1998
          --------------------------------------------------------
            QUARTERS ENDED               HIGH            LOW
          ------------------------    -----------    -------------
         <S>                         <C>            <C>
          June 30, 1998              $17 15/16           $14
          September 30, 1998         $16 5/16             $6

</TABLE>

     At September 30, 1998, the Company had a total of 17,044,742 shares of
common stock outstanding. As of September 30, 1998, the Company had not issued
any of the 10,000,000 authorized shares of its preferred stock.

DIVIDENDS

     It is the Company's current policy to retain earnings to support the 
growth of its present operations and to reduce its outstanding debt. Any 
future determination as to the payment of cash dividends on the Company's 
common stock will be at the discretion of the Company's Board of Directors 
and will depend on the Company's financial condition, results of operations 
and capital requirements, restrictive covenants in the credit agreement that 
limit the payment of dividends in any fiscal year (refer to Note 3 in the 
notes to consolidated financial statements) and such other factors as the 
Board of Directors deems relevant. No dividends were declared in fiscal 1998 
on the Company's common stock.

HOLDERS OF RECORD

     The Company had approximately 470 holders of record at December 10, 1998.

SALES OF UNREGISTERED SECURITIES

     In Fiscal 1998, the Company did not sell any unregistered securities.

                                    Page 10

<PAGE>

ITEM 6.   SELECTED HISTORICAL FINANCIAL AND OPERATING DATA
          (In Thousands, Except Per Share Data)

THE COMPANY AND THE PREDECESSOR(1)

     The following table sets forth selected historical financial data for 
the Company and the Predecessor. The selected financial data for the 
Predecessor and the Company were derived from the financial statements 
included elsewhere in this report and from other financial information not 
appearing herein.

     The selected consolidated financial and operating information set forth 
below should be read in conjunction with "Management's Discussion and 
Analysis of Financial Condition and Results of Operations" and the historical 
financial statements and notes thereto of the Company and the Predecessor and 
other financial information included elsewhere in this Form 10-K.

<TABLE>
<CAPTION>

                                                   PREDECESSOR(2)                                        COMPANY
                                    ------------------------------------------      -----------------------------------------------
                                                                     PERIOD            PERIOD            YEAR              YEAR
                                              YEAR END                ENDED             ENDED            ENDED             ENDED
                                            DECEMBER 31,            SEPT. 19,         SEPT. 30,        SEPT. 30,         SEPT. 30,
                                       1994              1995          1996             1996 (3)         1997(4)            1998
                                    ---------        -----------   -----------      ------------     -------------     ------------
<S>                                <C>              <C>           <C>              <C>              <C>               <C>
STATEMENT OF OPERATIONS DATA:
Revenues .....................      $ 50,725          $ 65,579       $ 55,186          $  3,555         $140,719          $185,945
Gross profit .................        14,905            18,816         15,696             1,113           44,326            59,573
Selling, general and
     administrative ..........        10,785            12,488          8,897               463           21,048            27,944
Compensation expense of stock
      options ................             -                 -              -                 -                -             1,486
Operating income .............         4,120             6,328          6,799               650           23,278            30,143
Interest expense .............         2,017             2,251          1,512               184            5,263             5,475
Provision for income
      taxes(5) ...............             -                 -              -               177            6,559             9,048
Net income ...................         2,200             4,104          5,306               289           11,603            15,783
Earnings per share:
   Basic .....................                                                         $    .02         $   0.73          $   0.94
   Diluted ...................                                                              .02             0.70              0.88
Weighted average shares
   Outstanding:
   Basic .....................                                                           15,118           15,897            16,741
   Diluted ...................                                                           15,118           16,509            18,011

</TABLE>

<TABLE>
<CAPTION>

                                           PREDECESSOR(2)                                              COMPANY
                                    ------------------------------                   ----------------------------------------------
                                             DECEMBER 31,                                            SEPTEMBER 30,
                                    ------------------------------                   ----------------------------------------------
                                        1994             1995                           1996(6)         1997(4)            1998
                                    ------------     -------------                   ------------   --------------     ------------
<S>                                <C>              <C>                             <C>            <C>                <C>
BALANCE SHEET DATA:
Current assets .............         $ 50,376          $ 58,962                        $ 86,611        $ 99,680           $141,915
Total assets ...............           51,504            59,970                          97,216         110,235            155,758
Current liabilities ........           10,078            33,548                          22,308          28,076             27,219
Long-term debt, less
      current maturities ...           16,929                 -                          55,500          49,000             75,000

Stockholders' equity .......           23,103            25,027                          19,408          33,159             53,539

</TABLE>

(1)  The financial information for the Company is not comparable to the
     financial information of the Predecessor due to the acquisition of Aviall
     Aerospace, the impact of applying the purchase method of accounting to the
     acquisitions of Predecessor and Aviall Aerospace and the change in tax
     status of the Predecessor from a Subchapter S corporation to a C
     corporation.

(2)  Tri-Star Aerospace, Inc. and subsidiary and affiliate.

                                    Page 11

<PAGE>

(3)  Reflects the results of operations for the 11-day period ended September
     30, 1996.

(4)  Following the acquisitions of the Predecessor and Aviall Aerospace, the
     Company changed the fiscal year-end of the Predecessor from December 31 to
     September 30.

(5)  The Predecessor's stockholders elected to be taxed under the provisions of
     Subchapter S of the Internal Revenue Code of 1986, as amended. As a
     Subchapter S corporation, the earnings of the Predecessor were taxable to
     the individual stockholders, and therefore, the Predecessor did not record
     a provision for income taxes.

(6)  The amounts shown as of September 30, 1996, reflect the consolidated
     balance sheet of the Company following the acquisitions of the Predecessor
     and Aviall Aerospace. The acquisitions have been accounted for under the
     purchase method of accounting and, accordingly, the consolidated balance
     sheet reflects the results of combined operations from the acquisition
     date.


AVIALL AEROSPACE

     The following table sets forth selected historical financial data for
Aviall Aerospace, a business unit of Aviall Services, Inc. The selected
financial data for Aviall Aerospace were derived from the financial statements
of Aviall Aerospace included elsewhere in this report and other financial
information not appearing herein. The selected financial information set forth
below should be read in conjunction with "Management's Discussion and Analysis
of Financial Condition and Results of Operations" and the historical financial
statements and notes thereto of Aviall Aerospace and other financial information
included elsewhere in this Form 10-K.

<TABLE>
<CAPTION>

                                                      YEAR ENDED DECEMBER 31,          PERIOD ENDED
                                                  ------------------------------        SEPT. 19,
                                                      1994              1995             1996(1)
                                                  -----------        -----------      -------------
<S>                                              <C>                <C>              <C>
STATEMENT OF OPERATIONS DATA:
   Revenues .....................................  $ 17,229           $ 25,580           $ 23,085
   Gross profit .................................     2,945              5,802              5,035
   Selling, general and administrative(2) .......     5,654              5,884              4,730
   Operating income (loss) ......................    (2,709)               (82)               305
BALANCE SHEET DATA:
   Current assets ...............................  $  6,680           $ 17,022           $ 20,528
   Total assets .................................     8,011             18,345             21,790
   Current liabilities ..........................     2,778              5,145              3,195
   Long-term debt ...............................         -                  -                  -
   Intercompany debt ............................     5,233             13,200             18,595

</TABLE>

(1)  Aviall Aerospace was acquired by the Company on September 19, 1996, and,
     accordingly, the operating results of Aviall Aerospace have been included
     in the Company's results of operations since September 20, 1996.

(2)  During the periods presented, Aviall Aerospace was not operated or
     accounted for as a separate entity. As a result, intercompany allocations
     of certain expense items from Aviall Services, Inc., including corporate
     overhead, were reflected in the financial statements of Aviall Aerospace.

                                    Page 12

<PAGE>

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

     THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH THE
CONSOLIDATED FINANCIAL STATEMENTS AND RELATED NOTES THERETO INCLUDED ELSEWHERE
IN THIS FORM 10-K.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

     Certain statements in this Form 10-K under "Management's Discussion and
Analysis of Financial Condition and Results of Operations" may constitute
"forward-looking statements" within the meaning of Section 21E of the Securities
and Exchange Act of 1934, as amended. These forward-looking statements can be
identified by the use of predictive, future-tense or forward-looking
terminology, such as "believes", "anticipates", "expects", "estimates", "may",
"will" or similar terms. Forward-looking statements also include projections
concerning any assumptions relating to the forgoing. Certain important factors
may cause actual results to vary materially from these forward-looking
statements accompany such statements and appear under the heading "Risk Factors"
in this Form 10-K. All subsequent written or oral forward-looking statements
attributable to the Company or persons acting on its behalf are expressly
qualified by these factors.

GENERAL

     The Company was formed on August 21, 1996, and began operations on
September 19, 1996, when it acquired the Predecessor and certain net assets of
Aviall Aerospace through simultaneous transactions. The acquisitions were
accounted for under the purchase method of accounting and, accordingly, the
operating results beginning September 20, 1996, reflect combined operations.
Following consummation of the acquisitions, the Company changed the fiscal year
end of the Predecessor from December 31 to September 30.

     The Company is both a leading distributor of aerospace hardware and a
leading provider of customized inventory management services to original
equipment manufacturers of aircraft and aircraft components, to commercial
airlines and aircraft maintenance, repair and overhaul facilities. In fiscal
year 1998 approximately 57% of the Company's revenues were derived from
conventional sales and approximately 43% of the Company's revenues were derived
from sales resulting from the Company's JIT services. For the fiscal year 1997,
conventional sales and JIT services represented 59% and 41% of revenues,
respectively.

MATTERS AFFECTING COMPARABILITY

     For the years ended September 30, 1998 and 1997, the financial statements
of the Company include the combined results of the Predecessor and Aviall
Aerospace. The period from January 1, 1996, to September 19, 1996, for the
Predecessor represents the stand-alone operations for less than a full year of
operations. Due to the differences in the length of the various periods and the
acquisition of the Predecessor and Aviall Aerospace by the Company, comparison
of periods may not be meaningful and are not necessarily indicative of future
results.

THE COMPANY

     The year ended September 30, 1998, compared to the year ended September 30,
1997:

     REVENUES - Revenues increased $45.2 million, or 32.1%, to $185.9 million
for the year ended September 30, 1998, compared to $140.7 million in 1997. The
Company's revenues have increased primarily due to an expansion of service
levels under certain existing JIT agreements, new JIT agreements and growth in
customer demand resulting from increased commercial aircraft build rates.

                                    Page 13

<PAGE>

     GROSS PROFIT - Gross profit increased $15.3 million, or 34.5%, to $59.6
million for the year ended September 30, 1998, compared to $44.3 million in
1997. The increase in gross profit was primarily due to an increase in revenues,
as discussed above. Gross margin as a percentage of sales increased to 32.0% for
the year ended September 30, 1998, compared to 31.5% for the same period in
1997. The increase in gross margin as a percentage of sales was due mainly to
lower freight cost and more efficient inventory management, coupled with normal
product mix changes.

     SELLING, GENERAL AND ADMINISTRATIVE - Selling, general and administrative
expenses increased $6.9 million, or 32.9%, to $27.9 million for the year ended
September 30, 1998, compared to $21.0 million in 1997. The increase was
primarily due to personnel costs related to building the management team and
providing support for initiatives to improve the efficiency and effectiveness of
operations and administration necessary to support the growth in revenues.

     COMPENSATION EXPENSE OF STOCK OPTIONS - On December 8, 1997, the Company
issued options to purchase 158,000 shares of the Company's common stock to an
executive at a discount from the fair market value at the date of grant. The
Company recorded additional nonrecurring compensation expense of $1.5 million
during the year ended September 30, 1998, as a result of these options.

     INTEREST EXPENSE - Interest expense increased 0.2 million, or 3.8%, to $5.5
million for the year ended September 30, 1998, compared to $5.3 million in 1997.
The increase in interest expense was due to higher debt levels somewhat offset
by reduced interest rates on outstanding borrowings. The increase in debt levels
resulted from increased working capital requirements to support the growth in
revenues.

     NET INCOME - Net income increased $4.2 million, or 36.2%, to $15.8 million,
or $0.88 per diluted share, for the year ended September 30, 1998, as compared
to $11.6 million, or $0.70 per diluted share, in 1997. Excluding the $1.5
million nonrecurring pretax charge related to the vesting of certain stock
options, net income increased $5.1 million, or 44.0%, to $16.7 million, or $0.93
per diluted share compared to 1997. The increase in net income was primarily due
to an increase in revenues and an increase in gross margin.

THE COMPANY AND THE PREDECESSOR

     The Company's year ended September 30, 1997, compared to the Predecessor's
period beginning January 1, 1996, and ended September 19, 1996:

     REVENUES - Revenues increased $85.5 million, or 154.9%, to $140.7 million
for the year ended September 30, 1997, compared to $55.2 million for the
Predecessor's period ended September 19, 1996. The increase was primarily due to
the acquisition of Aviall Aerospace, the 1997 amount representing a full year of
operations and growth in customer demand resulting from increased commercial
aircraft build rates, as well as the expansion of SKUs sold under JIT agreements
with six of the Company's major customers resulting from their increased
acceptance of the Company's JIT services.

     GROSS PROFIT - Gross profit increased $28.6 million, or 182.2%, to $44.3
million for the year ended September 30, 1997, compared to $15.7 million for the
Predecessor's period ended September 19, 1996. The increase was due primarily to
the increase in revenues, as discussed above. In addition, the gross margin
increased 3.1% to 31.5% for the year ended September 30, 1997, compared to 28.4%
for the Predecessor's period ended September 19, 1996. The increase was
primarily a result of a lower provision for excess and obsolete inventory during
1997 versus 1996, due to the Company's ability to better manage inventory
turnover and the general economic upturn in the aerospace industry, as well as a
retroactive price increase collected from a major JIT customer in December 1996,
and a general improvement in pricing.

                                     Page 14

<PAGE>

     SELLING, GENERAL AND ADMINISTRATIVE - Selling, general and administrative
expenses increased $12.1 million, or 136.0%, to $21.0 million for the year ended
September 30, 1997, compared to $8.9 million for the Predecessor's period ended
September 19, 1996. The increase was primarily due to the acquisition of Aviall
Aerospace, the 1997 amount representing a full year of operations and growth in
revenues. Selling, general and administrative expenses as a percentage of
revenues decreased 1.1% to 15.0% for the year ended September 30, 1997, compared
to 16.1% for the period ended September 19, 1996, primarily due to overhead
efficiencies resulting from the acquisitions of the Predecessor and Aviall
Aerospace.

     INTEREST EXPENSES - Interest expense increased $3.8 million, or 253.3%, to
$5.3 million for the year ended September 30, 1997, compared to $1.5 million for
the Predecessor's period ended September 19, 1996. The increase was primarily
due to the effect of the financing required to complete the acquisitions of the
Predecessor and Aviall Aerospace and the 1997 amount representing a full year of
operations. See "Liquidity and Capital Resources."

     PROVISION FOR INCOME TAXES -The provision for income taxes for the year
ended September 30, 1997, increased $6.6 million over the Predecessor's period
ended September 19, 1996. This increase was due to the results of operations for
the period ended September 19, 1996, including only the operations of the
Predecessor, which elected to be treated under the provisions of Subchapter S of
the Internal Revenue Code of 1986, as amended. As a Subchapter S corporation,
the earnings of the Predecessor were taxable to the stockholders of the
Predecessor and, therefore, the Predecessor did not record a provision for
income taxes. During 1997, the Company was subject to corporate income taxes.

     NET INCOME - Net income increased $6.3 million, or 118.9%, to $11.6 million
for the year ended September 30, 1997, compared to $5.3 million for the
Predecessor's period ended September 19, 1996. The increase was primarily due to
the acquisition of Aviall Aerospace, the 1997 amount representing a full year of
operations and the growth of revenues, offset by the effects of the Company
being subject to income taxes which were not applicable to the Predecessor as a
Subchapter S corporation.

LIQUIDITY AND CAPITAL RESOURCES

     The Company's liquidity requirements consist primarily of working capital
needs, capital expenditures and scheduled payments of principal and interest on
its indebtedness under the Credit Agreement (defined below). The Company funds
its liquidity requirements through cash flows from operations and a revolving
credit facility under the Credit Agreement (defined below). The Company's
working capital increased $43.1 million, or 60.2%, to $114.7 million as of
September 30, 1998, compared to $71.6 million as of September 30, 1997. The
Company's working capital requirements have increased primarily as a result of
higher accounts receivable and inventory levels needed to support its growth in
revenues.

     In connection with the acquisitions of the Predecessor and Aviall
Aerospace, on September 19, 1996, the Company entered into a credit agreement
with a syndicate of lenders (as amended, the "Credit Agreement"). Simultaneously
with the execution of the Credit Agreement, the Company executed term notes (the
"Term Notes") in the aggregate amount of $50.0 million. The Term Notes require
quarterly interest payments based on a specified "Base Rate" or the Eurodollar
rate plus a spread and annual principal payments of $500,000 due September 1997
through 2002 with the remaining principal balance due September 30, 2003.

     The Company has a $30.0 million revolving credit facility (the "Revolver").
As of September 30, 1998, the Company had borrowings of $26.5 million
outstanding under the Revolver. Interest on borrowings under the Revolver is
payable quarterly based upon the Base Rate or the Eurodollar rate plus a spread.
The commitments under the Revolver must be reduced by $15.0 million in September
2000 and 2001.

                                    Page 15

<PAGE>

     The Term Notes and Revolver provide for borrowings of up to $80.0 million
of which the Company had total borrowings of $75.5 million at November 17, 1998.
The Company's debt is collateralized by substantially all the assets of the
Company and its subsidiaries and is subject to certain financial covenants.

     For the year ended September 30, 1998, net cash used in operating
activities was $22.4 million. The cash flows from operations for fiscal 1998,
consisted primarily of net income of $15.8 million and noncash charges of $4.3
million, less changes in working capital items of $42.5 million. The principal
components of the change in working capital were increases in inventories of
$28.2 million and increases in accounts receivable of $11.1 million necessary to
support the Company's sales growth.

     For the year ended September 30, 1997, net cash provided by operating
activities was $9.6 million. The cash flows from operations for fiscal 1997
consisted primarily of net income of $11.6 million and noncash charges of $2.5
million, less changes in working capital items of $4.5 million. The principal
components of the change in working capital were increases in inventories of
$2.9 million and increases in accounts receivable of $8.4 million offset by an
increase in accounts payable of $5.5 million. These increases were a result of
the Company's sales growth.

     The Company's capital expenditures increased to $3.2 million for the year
ended September 30, 1998, from $1.0 million in 1997. This increase in capital
expenditures was a result of computer system expenditures and costs associated
with expansion of the corporate headquarters to consolidate the Company's
corporate functions in Dallas, Texas. The Company's net cash provided by
financing activities in fiscal 1998 was $29.1 million, consisting principally of
borrowings from the Revolver. The Company's net cash used in financing
activities in fiscal 1997 was $5.4 million, consisting primarily of payments
made on the Revolver.

     The Company expects to spend approximately $3.8 million for capital
expenditures in fiscal 1999. These capital expenditures will relate principally
to computer system (both software and hardware) upgrades, conversion and
implementation costs.

     The Company believes that internally generated cash flow and amounts that
may be available under the Revolver will provide adequate funds to meet its
working capital needs, planned capital expenditures and debt service
obligations.

YEAR 2000 COMPLIANCE

     The year 2000 issue is a result of computer programs being written with two
digits (rather than four) to define the applicable year, resulting in incorrect
calculations for the year 2000 and beyond.

     The Company has evaluated all of its primary computer software programs and
operating systems used for business processes to identify year 2000 issues.
Based upon this review, the Company has determined that its primary legacy
systems are not year 2000 compliant. These legacy systems currently handle the
following functions: purchasing; sales order entry; warehouse inventory
management and distribution; invoicing and accounts receivable; and accounts
payable.

     The Company is currently developing a plan to evaluate year 2000 compliance
for all non-information technology systems such as telephone systems, fax
machines, security systems, etc. The Company does not have any imbedded
microprocessors that will affect its internal systems. This evaluation and
remediation of noncompliant, noninformation technology systems should be
completed by mid-year 1999.

                                    Page 16

<PAGE>

     In 1998, the Company made the decision to replace its year 2000
noncompliant legacy systems and install two new replacement systems. The first
of these new systems, a distribution system, will perform the functions of
inventory management and distribution as well as sales order entry and
purchasing. The second replacement system is a financial software package that
will perform the functions of invoicing and accounts receivable, accounts
payable and general ledger. Both systems are currently in the implementation
phase and should be fully installed by March of 1999, but in no event will the
systems be installed any later than mid-year 1999.

     The majority of the cost incurred by the Company to become year 2000
compliant is related to the purchase and installation of the two new systems
described above. Through the end of fiscal year 1998, the Company spent an
estimated $.7 million on development and implementation of these systems. The
remaining system implementation costs will be incurred in fiscal year 1999 and
are estimated at approximately $2.2 million. Approximately 60% of the Company's
fiscal year 1999 capital expenditure budget will be spent to complete
implementation of the new systems. There are no significant information systems
projects pending as a result of year 2000 compliance work. No independent
verification of year 2000 risk or cost estimates has been performed by outside
third parties.

     The Company believes that it has identified all internal year 2000 issues
and has developed a plan to ensure that all systems will be compliant before the
year 2000. However, the Company cannot ensure that all third parties significant
to the Company's operations will be compliant in time. The Company believes that
the most likely worst-case scenario would be the effect on the Company of
noncompliance by third-party vendors or customers which do not become year 2000
compliant and have a significant business relationship with the Company. Major
noncompliant customers or vendors could have an adverse impact on the Company in
the areas of revenue collection, disbursements and communications as well as the
scheduling and delivery of inventory. To mitigate these problems, the Company
intends to develop a plan to survey all significant third parties about
readiness efforts. In addition, a review of all electronic data interchange
("EDI") linkages and data transmission between the Company and significant third
parties will be performed. Third-party surveys and data transmission tests
should be completed by mid-year 1999. Currently, the Company has no contingency
plan for the most likely worst-case scenario. If it appears that any significant
third party will not be compliant, the Company will develop contingency plans,
if possible, to mitigate the impact of noncompliance.

EFFECTS OF INFLATION

     The Company does not believe that inflation has had a significant impact on
its results of operations in recent years. However, there can be no assurance
that the Company's business will not be affected by inflation in the future.

NEW ACCOUNTING PRONOUNCEMENTS

     In February 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 132 ("SFAS 132") "Employers'
Disclosures about Pensions and Other Post-retirement Benefits". SFAS 132 revises
and improves the effectiveness of current note disclosure requirements for
employers' pensions and other retiree benefits by requiring additional
information to facilitate financial analysis and eliminating certain disclosures
which are no longer useful. SFAS 132 does not address recognition or measurement
issues. The Company will adopt SFAS 132 in fiscal 1999. Adoption of SFAS 132
will not have a significant impact on the Company.

     In June 1998, the FASB issued Statement of Financial Accounting Standards
No. 133 ("SFAS 133") "Accounting for Derivative Instruments and Hedging
Activities". SFAS 133 establishes accounting and reporting standards requiring
that every derivative instrument be recorded in the balance sheet as either an
asset or liability at its fair value. The Company will adopt SFAS 133 in fiscal
2000.

                                    Page 17

<PAGE>

The Company has determined that the adoption of this statement will have no 
effect on its financial statements.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISKS

     Market risks relating to the Company's operations result primarily from
changes in interest rates on outstanding borrowings under the Company's Credit
Agreement. Foreign currency and commodity risks have each been assessed by the
Company as immaterial. The Company has not engaged in hedging activity to limit
its interest rate exposures. Additionally, the Company does not use financial
instruments for trading purposes and is not a party to any leveraged
derivatives.

INTEREST RATE RISKS

     The following table provides information about the Company's financial
instruments that are sensitive to changes in interest rates. The table presents
the Company's debt obligations, principal cash flows and related
weighted-average interest rates by expected maturity dates. As interest rates
are variable, the stated values of market-sensitive instruments are equivalent
to fair value.



                            INTEREST RATE SENSITIVITY
                      PRINCIPAL AMOUNT BY EXPECTED MATURITY
                              (dollars in millions)

<TABLE>
<CAPTION>

                                                                                  FOR FISCAL YEAR ENDED SEPTEMBER 30,
                                                                                 -------------------------------------
                                                                      1999         2000          2001          2002         2003
                                                                    ---------    --------      --------      --------     --------
<S>                                                                <C>          <C>           <C>           <C>          <C>
Bank Term Note, matures September 30, 2003, interest payable      
   quarterly at the Eurodollar rate plus a spread of 2.0%
      -  scheduled principal payments ............................   $  0.5       $  0.5        $  0.5        $  0.5      $  47.0
      -  variable rate fixed every six months in November
      and May ....................................................     7.75%        7.75%         7.75%         7.75%        7.75%
Bank Revolver of $30 million, matures September 19, 2001, 
   interest payable quarterly, principally at the Eurodollar
   rate plus a spread of 1.0% with .5% on unused portion of 
   Revolver
       - scheduled principal payments ............................   $    -       $ 15.0       $  11.5        $   -       $   -
       - variable rate fixed each month (averaged) ...............     7.81%        7.81%         7.81%         N/A         N/A

</TABLE>

                                    Page 18

<PAGE>

ITEM 8.   CONSOLIDATED FINANCIAL STATEMENTS & SUPPLEMENTARY DATA


                     TRISTAR AEROSPACE CO. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                  (Dollars in Thousands, Except Per Share Data)

<TABLE>
<CAPTION>

                                                                                                    SEPTEMBER 30,
                                                                                           ----------------------------
                                                                                              1998              1997
                                                                                           ----------        ----------
<S>                                                                                       <C>               <C>
                                                     ASSETS
CURRENT ASSETS:
   Cash.............................................................................         $8,202            $4,764
   Accounts receivable, net of allowances of $1,072 and $549 (Note 2)...............         34,479            24,305
   Inventories, net of reserves of $4,921 and $2,332 (Note 2).......................         94,980            69,085
   Prepaid expenses.................................................................            970               149
   Deferred tax asset  (Note 4).....................................................          3,284             1,377
                                                                                           --------          --------
           Total current assets.....................................................        141,915            99,680
PROPERTY AND EQUIPMENT, net of depreciation of $1,413 and $483......................          3,932             1,623
INTANGIBLES AND OTHER ASSETS, net (Note 2)..........................................          9,911             8,932
                                                                                           --------          --------
                                                                                           $155,758          $110,235
                                                                                           --------          --------
                                                                                           --------          --------
                                    LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
   Current maturities of long-term debt.............................................           $500              $500
   Accounts payable.................................................................         21,272            18,308
   Income taxes payable.............................................................            645             1,573
   Accrued liabilities..............................................................          4,802             7,695
                                                                                           --------          --------
           Total current liabilities................................................         27,219            28,076
                                                                                           --------          --------
LONG-TERM DEBT, less current maturities.............................................         75,000            49,000
                                                                                           --------          --------
COMMITMENTS AND CONTINGENCIES (Note 5)
STOCKHOLDERS' EQUITY, per accompanying statements:
   Preferred stock, $.01 par value, 10,000,000 shares authorized....................            -                 -
   Common stock, $.01 par value, 40,000,000 shares authorized.......................            170               166
   Additional paid-in capital.......................................................         25,694            21,101
   Retained earnings................................................................         27,675            11,892
                                                                                           --------          --------
           Total stockholders' equity...............................................         53,539            33,159
                                                                                           --------          --------
                                                                                           $155,758          $110,235
                                                                                           --------          --------
                                                                                           --------          --------

</TABLE>

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

                                    Page 19

<PAGE>

                     TRISTAR AEROSPACE CO. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      (In Thousands, Except Per Share Data)

<TABLE>
<CAPTION>

                                                           YEAR ENDED         YEAR ENDED          PERIOD ENDED
                                                          SEPTEMBER 30,      SEPTEMBER 30,        SEPTEMBER 30,
                                                             1998                1997                 1996
                                                         ---------------    ---------------      ---------------
<S>                                                     <C>                <C>                  <C>
REVENUES:
   Product sales .............................             $ 184,512           $ 139,260           $   3,488
   Inventory management service fees .........                 1,433               1,459                  67
                                                           ---------           ---------           ---------
                                                             185,945             140,719               3,555

COST OF GOODS SOLD                                           126,372              96,393               2,442
                                                           ---------           ---------           ---------
   Gross profit ..............................                59,573              44,326               1,113

SELLING, GENERAL AND ADMINISTRATIVE
    EXPENSES .................................                27,944              21,048                 463

COMPENSATION EXPENSE OF STOCK OPTIONS ........                 1,486                 -                   -
                                                           ---------           ---------           ---------
   Operating income ..........................                30,143              23,278                 650

INTEREST AND OTHER:
   Interest expense ..........................                 5,475               5,263                 184
   Other income ..............................                  (163)               (147)                -
                                                           ---------           ---------           ---------
INCOME BEFORE TAXES ..........................                24,831              18,162                 466

PROVISION FOR INCOME TAXES ...................                 9,048               6,559                 177
                                                           ---------           ---------           ---------
NET INCOME                                                 $  15,783           $  11,603           $     289
                                                           ---------           ---------           ---------
                                                           ---------           ---------           ---------
EARNINGS PER SHARE:
    Basic ....................................             $    0.94           $    0.73           $    0.02
                                                           ---------           ---------           ---------
                                                           ---------           ---------           ---------
    Diluted ..................................             $    0.88           $    0.70           $    0.02
                                                           ---------           ---------           ---------
                                                           ---------           ---------           ---------
WEIGHTED AVERAGE SHARES OUTSTANDING:
    Basic ....................................                16,741              15,897              15,118
                                                           ---------           ---------           ---------
                                                           ---------           ---------           ---------
    Diluted ..................................                18,011              16,509              15,118
                                                           ---------           ---------           ---------
                                                           ---------           ---------           ---------

</TABLE>

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

                                    Page 20

<PAGE>

                     TRISTAR AEROSPACE CO. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                     COMMON STOCK               ADDITIONAL                            TOTAL
                                              ----------------------------       PAID-IN          RETAINED        STOCKHOLDERS'
                                                SHARES           AMOUNT          CAPITAL          EARNINGS            EQUITY
                                              ----------      ------------    ------------     -------------     ---------------
<S>                                          <C>             <C>             <C>              <C>               <C>
INCEPTION, August 21, 1996 ...............         -          $    -            $    -           $    -             $    -
Initial contribution of capital ..........      14,328             143            20,108              -               20,251
Equity transaction expenses ..............         -               -              (1,132)             -               (1,132)
Stock issued for services ................        790               8                (8)             -                  -
Net income ...............................         -               -                 -                289                289
                                              --------        --------          --------         --------           --------
BALANCE, September 30, 1996 ..............      15,118             151            18,968              289             19,408
Issuance of stock ........................         797               8             1,160              -                1,168
Conversion of note payable ...............         682               7               993              -                1,000
Purchase of stock ........................         (14)            -                 (20)             -                  (20)
Net income ...............................         -               -                 -             11,603             11,603
                                              --------        --------          --------         --------           --------
BALANCE, September 30, 1997 ..............      16,583             166            21,101           11,892             33,159
Issuance of stock ........................         462               4             1,032              -                1,036
Compensation expenses for stock 
  options ................................         -               -               1,486              -                1,486
Stock option income tax benefits .........         -               -               2,075              -                2,075
Net income ...............................         -               -                 -             15,783             15,783
                                              --------        --------          --------         --------           --------
BALANCE, September 30, 1998 ..............      17,045        $    170          $ 25,694         $ 27,675           $ 53,539
                                              --------        --------          --------         --------           --------
                                              --------        --------          --------         --------           --------
</TABLE>

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

                                    Page 21

<PAGE>

                     TRISTAR AEROSPACE CO. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                                        YEAR ENDED         YEAR ENDED         PERIOD ENDED
                                                                       SEPTEMBER 30,       SEPTEMBER 30,      SEPTEMBER 30,
                                                                           1998               1997               1996
                                                                       ------------        ------------     ---------------
<S>                                                                   <C>                 <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income ......................................................... $ 15,783           $ 11,603           $    289
  Adjustments to reconcile net income to net cash provided by
      (used in) operating activities, net of acquisitions:
      Depreciation and amortization ...................................    1,505              1,031                 27
      Provision for doubtful accounts .................................      892                549                  -
      Provision for excess and obsolete inventories ...................    2,589              2,338                  -
      Deferred income taxes ...........................................   (1,907)            (1,377)                 -
      Compensation expense of stock options ...........................    1,486                  -                  -
  Changes in operating assets and liabilities:
      Increase in accounts receivable .................................  (11,066)            (8,384)            (1,375)
      Increase in inventories .........................................  (28,484)            (2,902)              (330)
      (Increase) decrease in prepaid expenses/other ...................   (2,377)               (60)               169
      Increase (decrease) in accounts payable .........................    2,964              5,489               (304)
      Increase (decrease) in income taxes payable .....................     (928)             1,395                177
      Decrease in accrued liabilities .................................   (2,893)              (116)              (872)
                                                                        --------           --------           --------
           Net cash provided by (used in) operating activities ........  (22,436)             9,566             (2,219)
                                                                        --------           --------           --------
  CASH FLOWS FROM INVESTING ACTIVITIES:
      Capital expenditures ............................................   (3,237)              (972)                (3)
      Acquisitions, net of cash acquired ..............................        -                  -            (70,066)
                                                                        --------           --------           --------
        Net cash used in investing activities .........................   (3,237)              (972)           (70,069)
                                                                        --------           --------           --------
  CASH FLOWS FROM FINANCING ACTIVITIES:
      Issuance of stock ...............................................    1,036              1,168             20,251
      Stock option income tax benefits ................................    2,075                  -                  -
      Equity transaction expenses .....................................        -                  -             (1,132)
      Loan acquisition costs ..........................................        -                  -             (2,309)
      Proceeds from initial borrowings ................................        -                  -             55,000
      Borrowings on revolving facility ................................   27,000             11,700              2,000
      Payments on revolving facility ..................................     (500)           (17,700)                 -
      Payments on term note borrowings ................................     (500)              (500)                 -
      Purchase of stock                                                        -                (20)                 -
                                                                        --------           --------           --------
        Net cash provided by (used in) financing activities ...........   29,111             (5,352)            73,810
                                                                        --------           --------           --------
   NET INCREASE IN CASH ...............................................    3,438              3,242              1,522
   CASH, beginning of period ..........................................    4,764              1,522                  -
                                                                        --------           --------           --------
   CASH, end of period ................................................ $  8,202           $  4,764           $  1,522
                                                                        --------           --------           --------
                                                                        --------           --------           --------
  SUPPLEMENTAL CASH FLOW INFORMATION:
      Cash paid for interest .......................................... $  5,160           $  4,385           $    174
      Cash paid for income taxes ......................................    8,710              6,539                  -
</TABLE>

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

                                    Page 22

<PAGE>

                     TRISTAR AEROSPACE CO. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   ORGANIZATION AND BUSINESS:

     TriStar Aerospace Co. (formerly Maple Leaf Aerospace, Inc.) and
subsidiaries (the "Company") is both a leading distributor of aerospace
fasteners, fastening systems and related hardware and a leading provider of
customized inventory management services ("JIT services"). Both lines of
business serve original equipment manufacturers ("OEMs"), commercial airlines
and other aerospace companies.

     The Company was formed on August 21, 1996, and began operations on
September 19, 1996, when it acquired Tri-Star Aerospace, Inc. (the
"Predecessor") and certain net assets of the Aviall Aerospace business unit of
Aviall Services, Inc., and Aviall (Canada) Ltd. (together "Aviall Aerospace").
The Company acquired the outstanding stock of the Predecessor for $31.8 million,
including together $3 million of contingent consideration and assumption of
$20.6 million of Predecessor debt. The contingent consideration was placed in
escrow and is payable to the former shareholders of Predecessor on September 19,
1999, to the extent that such amount is not due the Company to satisfy certain
indemnifications given the Company by the former Predecessor shareholders (see
Note 5). Simultaneous with the acquisition of Predecessor, the Company acquired
the assets of Aviall Aerospace for cash of $18.6 million and assumption of $3.2
million of accounts payable.

     The acquisitions have been accounted for under the purchase method of
accounting and, accordingly, the purchase prices have been allocated to assets
acquired and liabilities assumed based on the fair-market values at the date of
acquisition. The excess of purchase price over the fair-market values of the net
assets acquired has been recorded as goodwill.

     On May 5, 1998, the Company completed an initial public offering (the 
"Offering") which initially involved the sale of 13,276,858 shares of the 
Company's common stock. In addition, 224,776 shares were sold by certain 
shareholders pursuant to an over-allotment option in connection with the 
Offering. The price offered to the public was $16.00 per share. The net 
proceeds of the Offering went to the selling stockholders.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:


BASIS OF PRESENTATION

     The accompanying consolidated financial statements are prepared in
accordance with generally accepted accounting principles and include the
accounts of the Company and its wholly owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated in consolidation.


USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at 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. 

                                    Page 23

<PAGE>

ACCOUNTS RECEIVABLE

     Accounts receivable consist of the following:

<TABLE>
<CAPTION>
                                                                       SEPTEMBER 30,
                                                                 --------------------------
                                                                   1998             1997
                                                                 ---------       ----------
                                                                       (IN THOUSANDS)
    <S>                                                         <C>             <C>
     Accounts receivable .......................................  $35,551          $24,854
     Less--allowance for doubtful accounts .....................    1,072              549
                                                                 ---------       ----------
                                                                  $34,479          $24,305
                                                                 ---------       ----------
                                                                 ---------       ----------
</TABLE>

     The Company serves the aerospace industry and grants unsecured credit to
its customers. Management's periodic evaluation of the adequacy of the allowance
for doubtful accounts is based on management's estimates of the creditworthiness
of its customers, the Company's past loss experience, known and inherent risks
in the customer base, adverse situations that may affect the customer's ability
to repay and current economic conditions. These estimates are reviewed
periodically and as adjustments become necessary, they are reported in earnings
in the periods in which they become known.

INVENTORIES

     Inventories are stated at the lower of cost (specific identification
     method) or market and consist of the following:

<TABLE>
<CAPTION>
                                                                         SEPTEMBER 30,
                                                                 --------------------------
                                                                   1998             1997
                                                                 ---------       ----------
                                                                       (IN THOUSANDS)
    <S>                                                         <C>              <C>
     Inventories ...............................................  $99,901          $71,417
     Less--allowance for excess and obsolete inventories .......    4,921            2,332
                                                                  -------          -------
                                                                  $94,980          $69,085
                                                                  -------          -------
                                                                  -------          -------
</TABLE>

     Adjustments to the allowance for excess and obsolete inventories consist of
the following:

<TABLE>
<CAPTION>
                                                                         SEPTEMBER 30,
                                                                 --------------------------
                                                                    1998             1997
                                                                 ---------       ----------
                                                                        (IN THOUSANDS)
    <S>                                                         <C>             <C>
     Balance, beginning of period ..............................  $ 2,332          $     -
     Provision for excess and obsolete inventories .............    2,589            2,338
     Inventories written off ...................................        -               (6)
                                                                  -------          -------
     Balance, end of period ....................................  $ 4,921          $ 2,332
                                                                  -------          -------
                                                                  -------          -------
</TABLE>

     The Company provides a reserve for potentially excess and obsolete
inventory. This reserve is based on management's estimates of future sales
projections in the aerospace industry and its place in the industry, sales
price, available customers and age of the inventory. This reserve is reviewed
periodically and as adjustments become necessary, they are reported in earnings
in the periods in which they become known.

                                    Page 24
<PAGE>

PROPERTIES AND DEPRECIATION

     Property and equipment are stated at cost and consist of leasehold
improvements, computer hardware and software, furniture and fixtures, machinery,
equipment and automobiles. Maintenance, repairs and betterments, including
replacement of minor items of physical properties, are charged to expense; major
additions to physical properties are capitalized. Property and equipment are
depreciated using the straight-line method over the estimated useful lives
ranging from three to 15 years.

INTANGIBLES AND OTHER ASSETS

     Intangibles and other assets are stated at cost net of amortization
computed on the straight-line and effective interest methods. Components and
useful lives of intangibles and other assets are as follows:

<TABLE>
<CAPTION>

                                                                         SEPTEMBER 30,
                                                                  ------------------------
                                                                    1998            1997
                                                                  --------        --------
                                                                       (IN THOUSANDS)
    <S>                                                          <C>              <C>
     Goodwill (30 years) .......................................  $ 7,111          $ 7,111
     Loan acquisition costs (7 years) ..........................    2,309            2,309
     Other .....................................................    1,643               87
                                                                  -------          -------
                                                                   11,063            9,507
     Less accumulated amortization .............................    1,152              575
                                                                  -------          -------
                                                                  $ 9,911          $ 8,932
                                                                  -------          -------
                                                                  -------          -------

</TABLE>

SEGMENT INFORMATION

     The Company's revenues by type are as follows:

<TABLE>
<CAPTION>

                                                                        SEPTEMBER 30,
                                                                 ---------------------------
                                                                   1998              1997
                                                                 ----------       ----------
                                                                       (IN THOUSANDS)
    <S>                                                         <C>              <C>
     Domestic revenues .........................................  $161,975         $121,480
     Export revenues ...........................................    21,207           12,098
     Foreign operations revenues ...............................     2,763            7,141
                                                                  --------         --------
     Total revenues ............................................  $185,945         $140,719
                                                                  --------         --------
                                                                  --------         --------

</TABLE>

EARNINGS PER SHARE

     The Company adopted Statements of Financial Accounting Standards No. 128
("SFAS 128") "Earnings Per Share," effective December 31, 1997, and all earnings
per share amounts disclosed herein have been calculated under the provisions of
SFAS 128. Basic earnings per common share were computed by dividing net income
by the weighted average number of shares of common stock outstanding during the
reporting period.

                                    Page 25

<PAGE>

A reconciliation of net income and weighted average shares used in computing
basic and diluted earnings per share is as follows:

<TABLE>
<CAPTION>

                                                      YEAR ENDED       YEAR ENDED       PERIOD ENDED
                                                     SEPTEMBER 30,    SEPTEMBER 30,    SEPTEMBER 30,
                                                         1998             1997             1996
                                                     -------------    -------------    -------------
                                                                     (IN THOUSANDS)
<S>                                                 <C>              <C>              <C>
Basic earnings per share:
Net income ..........................................  $15,783          $11,603          $   289
                                                       -------          -------          -------
                                                       -------          -------          -------
Weighted average common shares ......................   16,741           15,897           15,118
                                                       -------          -------          -------
                                                       -------          -------          -------
Basic earnings per common share .....................  $  0.94          $  0.73          $  0.02
                                                       -------          -------          -------
                                                       -------          -------          -------
Diluted earnings per share:
    Net income ......................................  $15,783          $11,603          $   289
                                                       -------          -------          -------
                                                       -------          -------          -------
Weighted average common shares ......................   16,741           15,897           15,118
Dilutive effect of stock options ....................    1,270              612                -
                                                       -------          -------          -------
Weighted average common shares,
    assuming dilutive effect of stock options .......   18,011           16,509           15,118
                                                       -------          -------          -------
                                                       -------          -------          -------
Diluted earnings per common share ...................  $  0.88          $  0.70          $  0.02
                                                       -------          -------          -------
                                                       -------          -------          -------

</TABLE>

     Options to purchase 137,820 shares of common stock at an exercise price of
$12.75 were outstanding during the period ended September 30, 1998. These
options were not included in the computation of diluted earnings per share
because inclusion of such stock options in such computation would be
antidilutive.

     On February 11, 1998, the Company declared a 158-for-one stock split. The
earnings per share and share amounts in the consolidated financial settlements
and the notes thereto have been restated to reflect the stock split.


RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

     In February 1998, the Financial Accounting Standards Board ("FASB") 
issued Statement of Financial Accounting Standards No. 132 ("SFAS 132"), 
"Employers' Disclosures about Pensions and Other Post-retirement Benefits". 
SFAS 132 revises and improves the effectiveness of current note disclosure 
requirements for employers' pensions and other retiree benefits by requiring 
additional information to facilitate financial analysis and eliminating 
certain disclosures which are no longer useful. SFAS 132 does not address 
recognition or measurement issues. The Company will adopt SFAS 132 in fiscal 
year 1999. Adoption of SFAS 132 will not have a significant impact on the 
Company.

     In June 1998, the FASB issued Statement of Financial Accounting Standards
No. 133 ("SFAS 133"), "Accounting for Derivative Instruments and Hedging
Activities". SFAS 133 establishes accounting and reporting standards
requiring that every derivative instrument be recorded in the balance sheet as
either an asset or liability at its fair value. The Company will adopt SFAS 133
in fiscal 2000. The Company has determined that the adoption of SFAS 133
will have no effect on its financial statements.

                                    Page 26

<PAGE>

3.        LONG-TERM DEBT:

     Long-term debt consists of the following:

<TABLE>
<CAPTION>

                                                                                                SEPTEMBER 30,
                                                                                       -----------------------------
                                                                                          1998              1997
                                                                                       -----------       -----------
<S>                                                                                   <C>               <C>
                                                                                               (IN THOUSANDS)
$30 million revolving credit facility, matures September 19, 2001, interest
   payable quarterly, principally at the Eurodollar rate plus a spread (7.5625%
   and 10.00% at September 30, 1998 and 1997, respectively), mandatory principal 
   reductions of $15 million in September 2000 and 2001 ............................      $26,500          $     -

Bank term note, matures September 30, 2003, interest payable quarterly at the
   Eurodollar rate plus a spread (7.75% and 9.00% at September 30, 1998 and
   1997, respectively), principal payments of $0.5 million due annually September 
   1999 through 2002 with the balance due at maturity ..............................       49,000           49,500
                                                                                          -------          -------
                                                                                           75,500           49,500

Current maturities of long-term debt ...............................................          500              500
                                                                                          -------          -------
                                                                                          $75,000          $49,000
                                                                                          -------          -------
                                                                                          -------          -------

</TABLE>

     Future maturities of long-term debt at September 30, 1998 were as follows
(in thousands):

<TABLE>

  <S>                                                            <C>
   1999.....................................................          $500
   2000.....................................................        15,500
   2001.....................................................        12,000
   2002.....................................................           500
   2003.....................................................        47,000
                                                                   -------
                                                                   $75,500
                                                                   -------
                                                                   -------

</TABLE>

     The Company's revolving credit facility (the "Revolver") and term note
provide for borrowings up to $80 million under the Company's credit agreement
which it entered into on September 19, 1996, with a syndicate of lenders (as
amended, the "Credit Agreement"). All of the Company's debt is borrowed by an
operating subsidiary and is collateralized by substantially all assets of the
operating subsidiaries of the Company. The debt is subject to certain financial
covenants and restricts dividends or loans by the operating subsidiaries to the
holding company. At September 30, 1998, the Company was in compliance with the
covenants.

     During 1997, the majority shareholder converted a $1 million
noninterest-bearing note into 682,244 shares of Company stock. The conversion
was treated as a non-cash transaction for purposes of the consolidated statement
of cash flows.

     During 1998, the Credit Agreement was amended to adjust certain 
financial covenants and reduce the interest rate spreads applicable to each 
of the facilities that vary, depending on the Company's leverage ratio.

     Based on the borrowing rates currently available to the Company for bank
loans with similar terms and average maturities, the fair value of the long-term
debt approximates the carrying value.

                                    Page 27

<PAGE>

4.       INCOME TAXES:

     The provision for income taxes includes the following components for the
periods ended September 30:

<TABLE>
<CAPTION>

                                                                  1998               1997             1996
                                                                --------          ---------         ---------
                                                                               (IN THOUSANDS)
<S>                                                            <C>               <C>               <C>
Current .......................................................  $10,955           $ 7,936           $   177
Deferred ......................................................   (1,907)           (1,377)                -
                                                                 -------           -------           -------
 ..............................................................  $ 9,048           $ 6,559           $   177
                                                                 -------           -------           -------
                                                                 -------           -------           -------

</TABLE>

     The provision for income taxes was at an effective rate of 36% for 1998 and
1997, and 38% for 1996. The following reconciles the provision for income taxes
included in the consolidated statements of income with the provision which would
result from the application of the statutory federal tax rate to pretax federal
income rate:

<TABLE>
<CAPTION>

                                                                  1998               1997              1996
                                                                --------           --------          --------
                                                                               (IN THOUSANDS)
<S>                                                            <C>                <C>               <C>
Expected provision at federal statutory rate of 35% for
    1998 and 1997, and 34% for 1996 ...........................  $ 8,691           $ 6,357           $   159
Increase (decrease) resulting from:
 State income taxes, net of federal income tax benefit ........      804               726                18
 Issuance of stock as consideration ...........................        -              (452)                -
 Other ........................................................     (447)              (72)                -
                                                                 -------           -------           -------
 Provision for income taxes ...................................  $ 9,048           $ 6,559           $   177
                                                                 -------           -------           -------
                                                                 -------           -------           -------
</TABLE>

     The Company's net deferred tax asset was as follows at September 30, 1998
and 1997:

<TABLE>
<CAPTION>
                                                        1998            1997
                                                      --------        --------
                                                           (IN THOUSANDS)
<S>                                                  <C>             <C>
Inventories .........................................  $2,405          $1,050
Stock options .......................................     361               -
Accounts receivable valuation reserves ..............     215             182
Accrued professional fees ...........................      -               76
Other ...............................................     303              69
                                                       ------          ------
Net deferred tax asset ..............................  $3,284          $1,377
                                                       ------          ------
                                                       ------          ------
</TABLE>

                                    Page 28

<PAGE>

5.        COMMITMENTS AND CONTINGENCIES:

OPERATING LEASES

     The Company leases office and warehouse facilities and certain computer
equipment under operating leases expiring from December 1998 to August 2008.
Future minimum annual lease commitments at September 30, 1998, are as follows
(in thousands):

<TABLE>

  <S>                                                              <C>
   Fiscal 1999...................................................     $813
   Fiscal 2000...................................................      385
   Fiscal 2001...................................................      146
   Fiscal 2002...................................................      114
   Fiscal 2003 ..................................................       42
   Thereafter ...................................................      106
                                                                    ------
   Total ........................................................   $1,606
                                                                    ------
                                                                    ------

</TABLE>

SALES AND PURCHASE CONTRACTS

     The Company is a party to various sales contracts with airlines that
require the Company to provide certain parts at fixed prices. The contracts
typically have a three to five year life. Generally, vendor purchases are made
under distributorship agreements which are cancelable upon 30-days' notice.

EMPLOYEE BENEFIT PLAN

     The Company sponsors a defined contribution profit sharing and 401(k)
savings plan which covers all employees with at least three months of service.
The Company matches 50 percent of employee contributions to the extent that the
employee's contributions do not exceed five percent of defined compensation.
Additional contributions may be made to the plan at the discretion of the Board
of Directors of the Company (the "Board").

LITIGATION

     The Company has been a defendant in two separate lawsuits for purchase of a
former Predecessor employee's stock in Predecessor and the rescission of a
certificate for stock in Predecessor. As discussed in Note 1, $3 million of the
purchase price of Predecessor was placed in escrow as indemnification to the
Company by the former shareholders of Predecessor to satisfy the liability, if
any, that the Company must pay. During the fiscal year ended September 30, 1998,
one of the two original lawsuits was discharged. While the amount claimed in the
remaining lawsuit is significant in the aggregate, management believes that the
Company's ultimate liability in excess of the indemnification, if any, will not
be material to the consolidated financial position or results of operations of
the Company.

     Various other lawsuits, claims and proceedings have been or may be
instituted or asserted against the Company. While the amounts claimed may be
substantial, the ultimate liability cannot now be determined because of the
considerable uncertainties that exist. Therefore, it is possible that results of
operations or liquidity in a particular period could be materially affected by
certain contingencies. However, based on facts currently available, management
believes it is remote that the matters pending or asserted will have a
materially adverse effect on the financial position of the Company.

                                    Page 29

<PAGE>

6.        SALES TO SIGNIFICANT CUSTOMERS:

     During the year ended September 30, 1998, the Company had two customers
that accounted for 23.2 percent and 14.5 percent of consolidated revenues,
respectively. During the year ended September 30, 1997, the Company had two
customers that accounted for 24.8 percent and 11.7 percent of consolidated
revenues, respectively.

7.        RELATED PARTY TRANSACTIONS:

     In conjunction with the acquisitions, an officer of the Company was issued
790,000 shares of the Company's common stock as consideration for services
rendered in connection with securing the equity to complete the transaction. The
stock issuance is recorded as a reduction in additional paid-in capital for the
par value of the shares issued in the consolidated statements of stockholders'
equity. This transaction was accounted for as a noncash financing activity and,
therefore, is not included in the consolidated statement of cash flows.

     As compensation for services rendered in coordinating, structuring and
consummating the simultaneous acquisitions of the Predecessor and Aviall
Aerospace, the Company agreed to pay an officer a fee of $2,560,000. The fee was
accrued as part of the purchase price accounting and was included in the
allocation of costs to the fair-market-value of assets acquired at September 19,
1996. As of September 30, 1997, the Company had paid $51,370. The remaining
balance was paid during fiscal 1998.


8.        EMPLOYEE STOCK PLANS:

STOCK PURCHASE PLAN

     The Company adopted an employee stock purchase plan which reserved 790,000
shares of common stock for issuance to any employee, officer or director at the
discretion of the Board. During the year ended September 30, 1997, 660,598
shares were issued under the plan at prices that approximated the
fair-market-value of the Company's stock on the date of commitment to issuance.

1996 STOCK OPTION PLAN

     The Company adopted the 1996 Stock Option Plan (the "1996 Plan") that
allowed for the issuance of 3,950,000 options to key employees of the Company.
The options become available in equal annual portions through fiscal 2001 based
on the attainment of certain financial performance measures. Once available, 25
percent become vested immediately, and the remaining options were to vest
ratably over the following three years. At the Offering date, options not yet
vested became vested, generally at 80% of the original options granted with the
remaining 20% of unvested options being forfeited. Under the 1996 Plan, options
were to be granted with an exercise price equal to or greater than the
fair-market-value of the Company's common stock at the date of grant. In
December 1997, 158,000 options were issued to one employee at a discount from
the fair value at the date of grant. Of these shares, 20% became immediately
exercisable and 80% of the remaining options become exercisable upon the
completion of the Offering. The Company has recorded compensation of $1,486,464
in the year ended September 30, 1998, for the discount from the fair value for
the shares exercisable at the grant dates. All options expire in September 2006.
The Company applies fixed plan accounting to the 1996 Plan, as both the number
of options and the exercise price of the options are known at the grant date. A
summary of the 1996 Plan activity follows:

                                    Page 30

<PAGE>

<TABLE>
<CAPTION>

                                                                                                                  WEIGHTED
                                                                                                                   AVERAGE
                                                                                            SHARES UNDER          PRICE PER
                                                                                               OPTION               OPTION
                                                                                            -------------        -----------
<S>                                                                                        <C>                  <C>
Outstanding, August 21, 1996 ............................................................    $         -             $   -
   Granted, exercise price equal to market price ........................................      2,214,845              1.47
   Granted, exercise price exceeds market price .........................................        361,820              7.60
                                                                                             -----------
Outstanding, September 30, 1996 .........................................................      2,576,665              2.33
   Granted, exercise price equal to market price ........................................        571,960              1.71
   Granted, exercise price exceeds market price .........................................        500,545              7.60
                                                                                             -----------
Outstanding, September 30, 1997 .........................................................      3,649,170              2.96
   Granted, market price exceeds exercise price .........................................        158,000              3.80
   Forfeited ............................................................................       (644,250)             3.19
   Exercised ............................................................................       (461,536)
                                                                                             -----------              2.24
Outstanding, September 30, 1998 .........................................................      2,701,384              3.07
                                                                                             -----------
                                                                                             -----------

</TABLE>

The following is a summary of stock options outstanding as of September 30,
1998:

<TABLE>
<CAPTION>

                   OPTIONS OUTSTANDING                                OPTIONS EXERCISABLE
     ----------------------------------------------              -------------------------------
                          OPTION         REMAINING                                     EXERCISE
        OPTIONS          EXERCISE       CONTRACTUAL                OPTIONS            PRICE PER
      OUTSTANDING          PRICE           LIFE                  EXERCISABLE            SHARE
     -------------      ----------      -----------              -----------          ----------
    <S>                <C>             <C>                      <C>                  <C>
       1,952,029           $1.47           8.00                   1,952,029              $1.47
          93,102            2.91           8.00                      93,102               2.91
          60,825            3.37           8.00                      60,825               3.37
          82,720            3.80           8.00                      82,720               3.80
          99,248            5.09           8.00                      99,248               5.09
         137,820            7.34           8.00                     137,820               7.34
         137,820            9.93           8.00                     137,820               9.93
         137,820           12.75           8.00                     137,820              12.75
      ----------                           ----                   ---------
       2,701,384                           8.00                   2,701,384
      ----------                           ----                   ---------
      ----------                           ----                   ---------

</TABLE>

     The Company applies the disclosure-only provisions of Statement of
Financial Accounting Standards No. 123 ("SFAS 123"), "Accounting for Stock-Based
Compensation". Accordingly, no compensation cost has been recognized for the
1996 Plan. However, pursuant to the requirements of SFAS 123, the following
disclosures are presented to reflect the Company's pro forma net income for the
year ended September 30, 1998 and 1997, and the period ended September 30, 1996,
as if the fair value method of accounting prescribed by SFAS 123 had been used.
Had compensation cost for the Company's 1996 Plan been determined consistent
with the provisions of SFAS 123, the Company's net income and earnings per share
would have been reduced to the pro forma amounts indicated below:

                                    Page 31

<PAGE>

<TABLE>
<CAPTION>

NET INCOME (in thousands):                                                    1998             1997            1996
                                                                          ------------     ------------    ------------
  <S>                                                                    <C>              <C>              <C>
   As reported..........................................................     $15,783          $11,603            $289
   Pro forma............................................................      14,303           11,474             289

  BASIC EARNINGS PER SHARE:
   As reported..........................................................       $0.94            $0.73           $0.02
   Pro forma............................................................        0.85             0.72            0.02

  DILUTED EARNINGS PER SHARE:
   As reported..........................................................       $0.88            $0.70           $0.02
   Pro forma............................................................        0.79             0.70            0.02

</TABLE>

     The fair value of each option grant is estimated on the date of grant using
the minimum value method with the following assumptions: dividend yield of 0
percent, weighted-average risk-free interest rate for 1998, 1997 and 1996 of
5.96 percent, 6.50 percent and 6.63 percent, respectively, and expected lives of
ten years.

1998 STOCK OPTION PLAN

     The Company's 1998 Stock Option Plan (the "1998 Plan") authorizes the
issuance of up to 2,000,000 shares of common stock of the Company pursuant to
stock options granted to key employees, nonemployee directors and consultants
of the Company. The 1998 Plan does not provide for stock appreciation rights.
The 1998 Plan will expire on April 1, 2008 unless earlier terminated by the
Board. No options were granted or outstanding under the 1998 Plan at September
30, 1998.

     On October 13, 1998, the Company granted 1,045,300 common stock options
under the 1998 Plan with an exercise price of $8.38 which was the closing market
price at that date. Twenty percent of these stock options vest and become
exercisable six months subsequent to the date of grant. The remaining options
will vest and become exercisable in equal increments of twenty percent on the
first, second, third and fourth anniversary of the grant date if certain Company
financial targets are met for each fiscal year as set by the Compensation
Committee of the Board; however, all options not previously vested will become
fully vested and exercisable no later than six months after the fourth
anniversary of the date of grant. The Company will apply fixed cost accounting
to these options and no compensation cost will be recognized under the
provisions of SFAS 123, "Accounting for Stock-Based Compensation".


9.        SUBSEQUENT EVENT:

     The Company executed a sixth amendment to its Credit Agreement dated
December 4, 1998. The most significant provisions of this amendment are the
expansion of the Company's Revolver from $30 million to $50 million, a provision
for the Company to use up to $20 million of the Revolver to repurchase the
Company's outstanding common stock and a provision which allows the Company's
French subsidiary, TriStar Aerospace SARL, to borrow up to $5 million under the
Revolver. Additionally, mandatory principal pay downs of outstanding borrowings
under the Revolver are $15 million in 2000 and $35 million in 2001. Certain
conditions precedent to the effectiveness of this amendment have not been 
completed.

                                    Page 32

<PAGE>

10.       QUARTERLY FINANCIAL DATA (UNAUDITED):

     The following quarterly financial data has been prepared from the financial
records of the Company without audit, and reflects all adjustments which, in the
opinion of management, were of a normal recurring nature and necessary for a
fair presentation of the results of operations for the interim periods presented
(in thousands, except per share amounts):

                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1998

<TABLE>
<CAPTION>

                                                                QUARTER ENDED
                                          ------------------------------------------------------------
                                          DEC. 31,        MARCH 30,           JUNE 30,        SEP. 30,
                                            1997             1998              1998             1998
                                          ---------      -----------        ----------       ---------
<S>                                      <C>            <C>                <C>              <C>
Net sales ...............................  $42,635          $45,768          $49,158          $48,384
Gross profit ............................   13,219           14,770           15,702           15,882
Operating income ........................    6,825            7,663            7,211            8,444
Net income ..............................    3,522            3,975            3,571            4,715
Basic earnings per common share .........  $  0.21          $  0.24          $  0.21          $  0.28
Diluted earnings per common share .......  $  0.19          $  0.22          $  0.20          $  0.26

</TABLE>

                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1997

<TABLE>
<CAPTION>

                                                                 QUARTER ENDED
                                          ------------------------------------------------------------
                                           DEC. 31,         MARCH 30,        JUNE 30,         SEP. 30,
                                            1996              1997             1997            1997
                                          ---------      -----------        ----------       ---------
<S>                                      <C>            <C>                <C>              <C>
Net sales ...............................  $30,966          $34,531          $36,238          $38,984
Gross profit ............................    9,958           10,731           11,659           11,978
Operating income ........................    5,511            5,708            6,159            5,900
Net income ..............................    2,444            2,748            3,056            3,355
Basic earnings per common share .........  $  0.16          $  0.18          $  0.19          $  0.20
Diluted earnings per common share .......  $  0.16          $  0.18          $  0.19          $  0.19

</TABLE>


                                    Page 33

<PAGE>


                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



To the Board of Directors and Stockholders
of TriStar Aerospace Co.:

     We have audited the accompanying consolidated balance sheets of TriStar
Aerospace Co. (a Delaware corporation) and subsidiaries as of September 30, 1998
and 1997, and the related consolidated statements of operations, stockholders'
equity and cash flows for the years ended September 30, 1998 and 1997, and the
period from inception (August 21, 1996) to September 30, 1996. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

     We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of TriStar Aerospace Co. and
subsidiaries as of September 30, 1998 and 1997, and the results of their
operations and their cash flows for the years ended September 30, 1998 and 1997,
and the period from inception to September 30, 1996, in conformity with
generally accepted accounting principles.



                                           ARTHUR ANDERSEN LLP


Tulsa, Oklahoma
November 17, 1998



                                    Page 34

<PAGE>

                     TRI-STAR AEROSPACE, INC. AND SUBSIDIARY

                        COMBINED STATEMENT OF OPERATIONS
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                                    PERIOD FROM
                                                                    JANUARY 1, TO
                                                                    SEPTEMBER 19,
                                                                         1996
                                                                    --------------
<S>                                                                <C>
REVENUES.......................................................         $55,186
COST OF GOODS SOLD.............................................          39,490
                                                                        -------
   Gross profit................................................          15,696
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES...................           8,897
                                                                        -------
   Operating income............................................           6,799
INTEREST EXPENSE...............................................           1,512
OTHER INCOME...................................................             (19)
                                                                        -------
   Net income..................................................          $5,306
                                                                        -------
                                                                        -------

</TABLE>

         The accompanying notes are an integral part of this statement.


                                    Page 35

<PAGE>

                     TRI-STAR AEROSPACE, INC. AND SUBSIDIARY

                        COMBINED STATEMENT OF CASH FLOWS
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                                                                      PERIOD FROM
                                                                                                     JANUARY 1, TO
                                                                                                     SEPTEMBER 19,
                                                                                                         1996
                                                                                                     --------------
 <S>                                                                                                <C>
  CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income..............................................................................              $5,306
  Adjustments to reconcile net income to net cash provided by operating activities:
      Depreciation and amortization........................................................                 356
      Provision for excess and obsolete inventories........................................               1,961
      Payment of dividends to minority interest owners.....................................                (272)
  Changes in operating assets and liabilities:
      Increase in accounts receivable......................................................                (499)
      Increase in inventories..............................................................                (541)
      Increase in prepaid expenses and other...............................................                (163)
      Increase in trade accounts payable...................................................               1,991
      Increase in integrated supply program contract payable...............................                 625
      Increase in accrued liabilities......................................................                 292
                                                                                                        -------
           Net cash provided by operating activities.......................................               9,056
                                                                                                        -------
  CASH FLOWS FROM INVESTING ACTIVITIES:
   Repayment of notes receivable...........................................................                 121
   Capital expenditures....................................................................                (190)
                                                                                                        -------
           Net cash used in investing activities...........................................                 (69)
                                                                                                        -------
  CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from borrowings................................................................              18,754
   Payments on debt........................................................................             (23,294)
   Distributions to stockholders...........................................................              (3,832)
                                                                                                        -------
           Net cash used in financing activities...........................................              (8,372)
                                                                                                        -------
   NET INCREASE  IN CASH...................................................................                 615
   CASH, beginning of period...............................................................                 131
                                                                                                        -------
   CASH, end of period.....................................................................                $746
                                                                                                        -------
                                                                                                        -------
  SUPPLEMENTAL CASH FLOW INFORMATION
   Cash paid for interest..................................................................              $1,646

</TABLE>

         The accompanying notes are an integral part of this statement.

                                    Page 36

<PAGE>

                     TRI-STAR AEROSPACE, INC. AND SUBSIDIARY

                     NOTES TO COMBINED FINANCIAL STATEMENTS


1.   ORGANIZATION AND BUSINESS:

     Tri-Star Aerospace, Inc. and subsidiary (the "Company") is a single-source
distributor of aerospace fasteners, fittings, and other related hardware. The
Company's major products include fasteners (bolts, nuts, pins, washers, screws,
rivets), fluid and hydraulic systems parts (fittings, couplings, valves),
bearings and related aerospace hardware. The Company has over 2,000 customers
which include original equipment manufacturers of aircraft and aircraft
components, commercial airlines and aircraft maintenance, repair and overhaul
facilities.

     The Company owns 73.8 percent of Tri-Star International, Inc. (an inactive
Interest Charge Domestic International Sales Corporation). Included in the
combined financial statements of the Company is Tri-Star Inventory Management
Services, Inc. (TIMS), a company under the common ownership and control of the
Company's stockholders.

         The Company's central distribution facility is located in Tulsa,
Oklahoma. The Company has eight additional sales offices and six regional
warehouses located within the United States, Canada and the United Kingdom.


2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:


BASIS OF PRESENTATION

     The combined financial statements include accounts of Tri-Star Aerospace,
Inc., Tri-Star International, Inc. and Tri-Star Inventory Management Services,
Inc. Intercompany transactions have been eliminated.

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at 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.

REVENUE RECOGNITION

     Revenues are recognized at the time of shipment.

INCOME TAXES

     The Company's stockholders have elected to be taxed under the S corporation
provisions of the Internal Revenue Code of 1986, as amended. As an S
corporation, the earnings of the Company are taxable to the individual
stockholders. Therefore, the Company does not record deferred tax assets or
liabilities or income tax expense.

                                    Page 37

<PAGE>

3.   CONCENTRATION OF BUSINESS RISK:


     The Company serves the aerospace industry and grants unsecured credit to
its customers. Management's periodic evaluation of the adequacy of the allowance
for doubtful accounts is based on management's estimates of the creditworthiness
of its customers, the Company's past loss experience, known and inherent risks
in the customer base, adverse situations that may affect the customer's ability
to repay and current economic conditions. These estimates are reviewed
periodically and as adjustments become necessary, they are reported in earnings
in the periods in which they become known.

     The Company also provides a reserve for potentially excess and obsolete
inventory. This reserve is based on management's estimates of future sales
projections in the aerospace industry and its place in the industry, sales
price, available customers and age of the inventory. This reserve is reviewed
periodically and as adjustments become necessary, they are reported in earnings
in the periods in which they become known.

     During the period from January 1 to September 19, 1996, the Company had
three customers that individually accounted for more than ten percent of
revenues.


4.   COMMITMENTS AND CONTINGENCIES:


OPERATING LEASES

     The Company leases office and warehouse facilities and certain computer
equipment under operating leases expiring from September 1996, to November 2000.
Future minimum annual lease commitments (September 30 year-end) at September 19,
1996, are approximately as follows (in thousands):

<TABLE>

  <S>                                                         <C>
   1997....................................................      $617
   1998....................................................       611
   1999....................................................       411
   2000....................................................       171
   2001....................................................        14
                                                               ------
                                                               $1,824
                                                               ------
                                                               ------

</TABLE>

SALES AND PURCHASE CONTRACTS

     The Company is a party to various sales contracts with airlines that
require the Company to provide certain parts at fixed prices. The contracts
generally have a two-year life. Generally, vendor purchases are made under
distributorship agreements which are cancelable upon 30 days' notice.

EMPLOYEE BENEFIT PLANS

     The Company has an employee savings and investment plan (the "Plan") which
is qualified under Section 401(k) of the Internal Revenue Code. The Plan is a
defined contribution plan covering all employees of the Company. All employees
hired as of the first day of the year may contribute, on a pre-tax basis, up to
the maximum amount allowable by law. The Company may, at the discretion of the
Board of Directors, make a contribution to the Plan up to 10 percent of the
employee's base earnings. Only employees who worked a minimum of 1,000 hours in
the previous year are eligible for the Company's contribution. The Company
expensed $45,000 in 1996, related to the Company's contributions.

                                    Page 38

<PAGE>

     The Company has an employees' welfare benefit plan which is subject to the
provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The
Plan provides death benefits covering substantially all employees of the
Company. The Plan requires the Company to contribute to the trust such amounts
as the Board of Directors determines necessary to properly fund the benefits
payable under the Plan.

LITIGATION

     The Company is the defendant in two separate lawsuits for purchase of a
former employee's stock in the Company and the rescission of a certificate for
stock in the Company. While the amount of the lawsuits is significant in the
aggregate, management believes that the Company's ultimate liability, if any,
will not be material to its combined financial position or results of combined
operations. The stockholders of the Company have indemnified TriStar Aerospace
Co. by accepting contingent consideration for a portion of the sales price (see
Note 5).


5.   SUBSEQUENT EVENT:


     On September 19, 1996, the Company was acquired by TriStar Aerospace Co. 
("TriStar," formerly Maple Leaf Aerospace, Inc.) through a series of 
transactions for approximately $31.8 million, including $3 million of 
contingent consideration and assumption of $20.6 million in debt. Such 
contingent consideration was placed in escrow and is payable to the former 
shareholders of the Company on September 19, 1999, to the extent that such 
amount is not due TriStar to satisfy certain indemnifications given TriStar 
by the former shareholders.

                                    Page 39

<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Board of Directors and Stockholders
of TriStar Aerospace Co.:

     We have audited the accompanying combined statement of operations and cash
flows of Tri-Star Aerospace, Inc. (a Florida corporation) and subsidiary and
affiliate for the period from January 1, 1996, to September 19, 1996. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

     We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the results of operations and cash flows of Tri-Star
Aerospace, Inc. and subsidiary and affiliate for the period from January 1,
1996, to September 19, 1996, in conformity with generally accepted accounting
principles.



                                          ARTHUR ANDERSEN LLP

Tulsa, Oklahoma
January 24, 1997


                                    Page 40

<PAGE>

                 AVIALL AEROSPACE BUSINESS UNIT OF AVIALL, INC.

                          STATEMENT OF OPERATING INCOME
                                 (In Thousands)

<TABLE>
<CAPTION>
                                                                                                   PERIOD FROM
                                                                                                  JANUARY 1, TO
                                                                                                   SEPTEMBER 19,
                                                                                                       1996
                                                                                                 ----------------
<S>                                                                                             <C>
REVENUES..................................................................................            $23,085
COST OF GOODS SOLD........................................................................             18,050
                                                                                                      -------
   Gross profit...........................................................................              5,035
                                                                                                      -------
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:
   Third-party expenses...................................................................              3,541
   Intercompany allocations...............................................................              1,189
                                                                                                      -------
                                                                                                        4,730
                                                                                                      -------
Operating income .........................................................................               $305
                                                                                                      -------
                                                                                                      -------
</TABLE>

         The accompanying notes are an integral part of this statement.


                 AVIALL AEROSPACE BUSINESS UNIT OF AVIALL, INC.

                             STATEMENT OF CASH FLOWS
                                 (In Thousands)

<TABLE>
<CAPTION>
                                                                                            PERIOD FROM
                                                                                           JANUARY 1, TO
                                                                                           SEPTEMBER 19,
                                                                                               1996
                                                                                          --------------
<S>                                                                                       <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Operating income ...................................................................      $305
     Adjustments to reconcile operating income (loss) to net cash used in operating
      activities:
     Depreciation........................................................................       304
     Loss on sale of fixed assets........................................................         2
     Provision for excess and obsolete inventories.......................................     1,072
     Changes in assets and liabilities:
            Decrease in accounts receivable..............................................       607
            Increase in inventories......................................................    (5,164)
            Increase in prepaid expenses and other.......................................       (21)
            Decrease in accounts payable.................................................    (1,947)
            Decrease in accrued liabilities..............................................        (3)
                                                                                             ------
                 Net cash used in operating activities...................................    (4,845)
                                                                                             ------
CASH FLOWS FROM INVESTING ACTIVITIES:
      Capital expenditures...............................................................      (245)
                                                                                             ------
CASH FLOWS FROM FINANCING ACTIVITIES:
      Net intercompany borrowings........................................................     5,090
                                                                                             ------
NET INCREASE IN CASH.....................................................................       -
CASH, beginning of period................................................................        22
                                                                                             ------
CASH, end of period......................................................................       $22
                                                                                             ------
                                                                                             ------
</TABLE>

         The accompanying notes are an integral part of this statement.

                                    Page 41
<PAGE>

                 AVIALL AEROSPACE BUSINESS UNIT OF AVIALL, INC.

                          NOTES TO FINANCIAL STATEMENTS

1.   ORGANIZATION AND BUSINESS:

     Aviall, Inc.'s ("Aviall") aerospace business unit ("Aviall Aerospace") 
is engaged in the distribution of aerospace fasteners to major aircraft 
original equipment manufacturers and their subcontractors, primarily in the 
United States and Canada. Aviall Aerospace's principal location is a facility 
in Dallas, Texas, with additional stocking locations in Toronto, Montreal, 
Long Beach and St. Louis. Prior to the sale of Aviall Aerospace, discussed in 
Note 6, the U.S. operations were a portion of Aviall Services, Inc., a U.S. 
wholly owned subsidiary of Aviall, and the stocking locations in Toronto and 
Montreal, Canada were a portion of Aviall Ltd., a wholly owned foreign 
subsidiary of Aviall.

2.   BASIS OF PRESENTATION:

     The accompanying statement of operating income is intended to present the
results of Aviall Aerospace including allocations for corporate level expenses
(see Note 5) incurred by Aviall and allocated to Aviall Aerospace. The statement
is not intended to be a complete presentation of Aviall Aerospace's results of
operations. The results of Aviall Aerospace were included in Aviall's
consolidated corporate tax return. No provision for income taxes has been
recorded in the statement of operating income.

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at 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.

3.   CONCENTRATION OF BUSINESS RISK:

     Aviall Aerospace serves the aerospace industry and grants unsecured credit
to its customers. Management's periodic evaluation of the adequacy of the
allowance for doubtful accounts is based on management's estimates of the
creditworthiness of its customers, Aviall Aerospace's past loss experience,
known and inherent risks in the customer base, adverse situations that may
affect the customer's ability to repay and current economic conditions. These
estimates are reviewed periodically and as adjustments become necessary, they
are reported in earnings in the periods in which they become known.

     Aviall Aerospace also provides a reserve for potentially excess or obsolete
inventory. This reserve is based on management's estimates of future sales
projections in the aerospace industry and its place in the industry, sales
price, available customers and age of the inventory. This reserve is reviewed
periodically and as adjustments become necessary, they are reported in earnings
in the periods in which they become known.

     During the period from January 1, to September 19, 1996, Aviall Aerospace
had two customers that individually accounted for more than ten percent of
revenues.

4.   COMMITMENTS:

     Aviall Aerospace is a party to various sales contracts with airlines that
require Aviall Aerospace to provide certain parts at fixed prices. The contracts
generally have a two-year life. Generally, vendor purchases are made under
distributorship agreements that are cancelable upon 30 days' notice.

                                    Page 42

<PAGE>

5.   TRANSACTIONS WITH AFFILIATES:

     Aviall Aerospace had sales of $1,254,000 in 1996, to Aviall affiliates.
Corporate level expenses of $1,189,000 were allocated to Aviall Aerospace in
1996. These corporate allocations include general corporate expenses such as
telephone, rent, utilities, maintenance, supplies, accounting, management
salaries and marketing.

6.   SUBSEQUENT EVENT:

     On September 19, 1996, certain net assets of Aviall Aerospace were
purchased by TriStar Aerospace Co. (formerly Maple Leaf Aerospace, Inc.) for
approximately $18.6 million and assumption of $3.2 million of accounts payable.







                                    Page 43

<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Board of Directors and Stockholders
of TriStar Aerospace Co.:

     We have audited the accompanying statements of operating income and cash
flows of the Aviall Aerospace Business Unit of Aviall, Inc. (a Delaware
corporation) for the period from January 1, 1996, to September 19, 1996. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

     We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the results of operations and cash flows of the Aviall
Aerospace Business Unit of Aviall, Inc. for the period from January 1, 1996, to
September 19, 1996, in conformity with generally accepted accounting principles.




                                        ARTHUR ANDERSEN LLP

Tulsa, Oklahoma
May 9, 1997



                                    Page 44

<PAGE>

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

     None.

                                    PART III

ITEM 10.  DIRECTORS EXECUTIVE OFFICERS OF THE RESTRAINT

     The information set forth under the captions "Management" and "Section
16(a) Beneficial Ownership Reporting Compliance" in the Company's definitive
Proxy Statement to be filed in connection with the 1999 Annual Meeting of the
Stockholders to be held on January 22, 1999 is incorporated herein by reference.

ITEM 11.  EXECUTIVE COMPENSATION

     The information set forth under the caption "Compensation of Executive
Officers" in the Company's definitive Proxy Statement to be filed in connection
with the 1999 Annual Meeting of the Stockholders to be held on January 22, 1999
is incorporated herein by reference.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information set forth under the caption "Security Ownership of Certain
Beneficial Owners and Management" in the Company's definitive Proxy Statement to
be filed in connection with the 1999 Annual Meeting of the Stockholders to be
held on January 22, 1999 is incorporated herein by reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information set forth under the caption "Certain Related Party
Transactions" in the Company's definitive proxy Statement to be filed in
connection with the 1999 Annual Meeting of the Stockholders to be held on
January 22, 1999 is incorporated herein by reference.

                                     PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENTS SCHEDULES AND REPORTS ON FORM 8-K

     (a)  Exhibits.

<TABLE>
<CAPTION>

        EXHIBIT                        DESCRIPTION
        NUMBER
        <C>        <S>
          2.1       Agreement and Plan of Merger, dated as of August 28, 1996,
                    by and among Maple Leaf Aerospace, Inc., Aerospace
                    Acquisition Corp., Aerospace Merger Sub I, Inc., Tri-Star
                    Aerospace Inc., and certain stockholders is incorporated
                    herein by reference to Exhibit 2.1 included in the
                    Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          2.2       Asset Purchase Agreement, dated September 5, 1996, by and
                    among Aviall (Canada) Ltd., Aviall Services, Inc. and Maple
                    Leaf Aerospace, Inc. is incorporated herein by reference to
                    Exhibit 2.2 included in the 

                                    Page 45

<PAGE>

                    Registration Statement Number 333-46335 on Form S-1 
                    effective April 29, 1998.

          3.1       Certificate of Amended and Restated Incorporation of the
                    Company, filed May 5, 1998 (1).

          3.2       Amended and Restated Bylaws of the Company approved 
                    February 11, 1998 (1)

          4.1       Form of Common Stock Certificate is incorporated herein by
                    reference to Exhibit 4.1 included in the Registration
                    Statement Number 333-463356 on Form S-1 effective April 29,
                    1998.

          10.1      Credit Agreement, dated as of September 19, 1998, among the
                    Company and Bankers Trust Company, as agent, is incorporated
                    herein by reference to Exhibit 10.1 included in the
                    Registration Statement Number 333-463335 on Form S-1
                    effective April 29, 1998.

          10.2      First Amendment to Credit Agreement, dated as of April,
                    1997, among the Company and Bankers Trust Company, as agent,
                    is incorporated herein by reference to Exhibit 10.2 included
                    in the Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          10.3      Second Amendment to the Credit Agreement, dated as of August
                    4, 1997, among the Company and Bankers Trust Company, as
                    agent, is incorporated herein by reference to Exhibit 10.3
                    included in the Registration Statement Number 333-46335 on
                    Form S-1 effective April 29, 1998.

          10.4      Third Amendment to the Credit Agreement, dated as of
                    November 7, 1997, among the Company and Bankers Trust
                    Company, as agent, is incorporated herein by reference to
                    Exhibit 10.4 included in the Registration Statement Number
                    333-46335 on Form S-1 effective April 29, 1998.

          10.5      Fourth Amendment to the Credit Agreement, dated as of
                    February 9, 1998, among the Company and Bankers Trust
                    Company, as agent, is incorporated herein by reference to
                    Exhibit 10.33 included in the quarterly report on Form 10-Q
                    dated June 12, 1998.

          10.6      Fifth Amendment to the Credit Agreement, dated as of June
                    30, 1998, among the Company and Bankers Trust Company, as
                    agent, is incorporated herein by reference to Exhibit 10.34
                    included in the quarterly report on Form 10-Q dated August
                    13, 1998.

          10.7      Form of Sixth Amendment to the Credit Agreement, dated as of
                    December 4, 1998, among the Company and Bankers Trust
                    Company, as agent. (1)

          10.8      Security Agreement, dated as of September 19, 1996, among
                    the Company and Bankers Trust Company, as agent, is
                    incorporated herein by reference to Exhibit 10.5 included in
                    the Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

                                     Page 46

<PAGE>

          10.9      Pledge Agreement, dated as of September 19, 1996, among the
                    Company and Bankers Trust Company, as agent, is incorporated
                    herein by reference to Exhibit 10.6 included in the
                    Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          10.10     Lease Agreement, dated as of July 12, 1990, among the
                    Company and Robert L. Zeligson Trust, is incorporated herein
                    by reference to Exhibit 10.7 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.11     Lease Agreement, dated as of December 4, 1990, among the
                    Company and Robert L. Zeligson Trust, is incorporated herein
                    by reference to Exhibit 10.8 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.12     Lease Agreement, dated as of May 31, 1991, among the Company
                    and Robert L. Zeligson Trust, is incorporated herein by
                    reference to Exhibit 10.9 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.13     Build and Lease Agreement, dated as of April 30, 1993, among
                    the Company and Robert L. Zeligson Trust, is incorporated
                    herein by reference to Exhibit 10.10 included in the
                    Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          10.14     Sublease, dated as of September 19, 1996, among the Company
                    and Aviall Services, Inc., together with First Amendment to
                    Sublease, dated as of September 19, 1996, among the Company
                    and Aviall Services, Inc., is incorporated herein by
                    reference to Exhibit 10.11 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.15     Lease Agreement, dated as of January 28, 1997, among the
                    Company and Robert L. Zeligson Trust, is incorporated herein
                    by reference to Exhibit 10.12 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.16     Lease Agreement, dated as of September 16, 1997, among the
                    Company and William Weinberg, is incorporated herein by
                    reference to Exhibit 10.13 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.17     Amended and Restated Management Stockholders' and
                    Optionholders' Agreement, dated as of May 15, 1997, among
                    the Company, Odyssey Partners, L.P., B.T. Investment
                    Partners, Inc. and certain Stockholders, is incorporated
                    herein by reference to Exhibit 10.15 included in the
                    Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          10.18     Maple Leaf Aerospace, Inc. 1996 Stock Option Plan, is
                    incorporated herein by reference to Exhibit 10.16 included
                    in the Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

                                     Page 47

<PAGE>

          10.19     Employment Agreement, dated as of September 19, 1996,
                    between the Company and Quentin Bourjeaurd, is incorporated
                    herein by reference to Exhibit 10.18 included in the
                    Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          10.20     Employment Agreement, dated as of February 1, 1997, between
                    the Company and Charles Balchunas, is incorporated herein by
                    reference to Exhibit 10.19 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.21     Employment Agreement, dated as of January 15, 1998, between
                    the Company and Douglas E. Childress. (1)

          10.22     Employment Agreement, dated as of December 8, 1997, between
                    the Company and Denny Barge. (1)

          10.23     Employment Agreement, dated as of August 1, 1998, between
                    the Company and Trevor Wright. (1)

          10.24     Letter Agreement, dated as of May 15, 1997, between the
                    Company and John R. King, Jr. (1)

          10.25     Promissory Note, dated as of September 19, 1996, from
                    Quentin Bourjeaurd in favor of the Company, is incorporated
                    herein by reference to Exhibit 10.22 included in the
                    Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          10.26     Promissory Note, dated as of April 15, 1996, from Quentin
                    Bourjeaurd in favor of the Company, is incorporated herein
                    by reference to Exhibit 10.23 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.27     Promissory Note, dated as of May 30, 1997, from Charles
                    Balchunas in favor of the Company, is incorporated herein by
                    reference to Exhibit 10.24 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

          10.28     TriStar Aerospace Co. 1998 Stock Option Plan, is
                    incorporated herein by reference to Exhibit 10.26 included
                    in the Registration Statement Number 333-46335 on Form S-1
                    effective April 29, 1998.

          10.29     TriStar Aerospace Co. Executive and Key Employee Incentive
                    Plan, is incorporated herein by reference to Exhibit 10.27
                    included in the Registration Statement Number 333-46335 on
                    Form S-1 effective April 29, 1998.

          10.30     Letter Agreement, dated as of September 19, 1996, between
                    the Company and Quentin Bourjeaurd, is incorporated herein
                    by reference to Exhibit 10.28 included in the Registration
                    Statement Number 333-46335 on Form S-1 effective April 29,
                    1998.

                                     Page 48

<PAGE>

          10.31     Amended and Restated Maple Leaf Aerospace, Inc. 1996 Stock
                    Option Plan, is incorporated herein by reference to Exhibit
                    10.31 included in the Registration Statement Number 
                    333-46335 on Form S-1 effective April 29, 1998.

          21.1      Subsidiaries of the Registrant. (1)

          23.1      Consent of Arthur Andersen LLP. (1)

          24.1      Powers of Attorney of directors and officers of the
                    Registrant (included on page 50).

          27.1      Financial Data Schedule.

</TABLE>


(1)  Filed herewith.


     (b)  Financial Statement Schedules

          Financial Statement Schedules have been omitted because the required
          information is not applicable or because such information is included
          in the financial statements and notes thereto included in this Annual
          Report filed on Form 10-K.

     (c)  Reports on Form 8-K

     No Reports on Form 8-K were filed during the fiscal year ended September
     30, 1998.





                                     Page 49

<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.

     Date: December 10, 1998           TRISTAR AEROSPACE CO.



                                       By: /s/ DOUGLAS E. CHILDRESS
                                           ------------------------------------
                                                Douglas E. Childress
                                                Executive Vice President and
                                                Chief Financial Officer
                                                (Principal Financial 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.

<TABLE>


<S>                               <C>                                     <C>
By: /s/ P. QUENTIN BOURJEAURD      Chairman, President and Chief           Date: December 10, 1998
    --------------------------     Executive Officer
      P. Quentin Bourjeaurd        (Principal Executive Officer)

                                     
By: /s/ DOUGLAS E. CHILDRESS       Executive Vice President, Chief         Date: December 10, 1998
    --------------------------     Financial Officer, and Director
       Douglas E. Childress        (Principal Financial Officer)
                              

By: /s/ CHARLES BALCHUNAS          Executive Vice President, Chief         Date: December 10, 1998
    --------------------------     Operating Officer and Director
        Charles Balchunas

By: /s/ BRIAN E. BARENTS           Director                                Date: December 10, 1998
    --------------------------
         Brian E. Barents


By: /s/ CINDY B. BROWN             Director                                Date: December 10, 1998
    --------------------------
         Cindy B. Brown


By: /s/ JAMES L. HERSMA            Director                                Date: December 10, 1998
    --------------------------
         James L. Hersma

</TABLE>

                                    Page 50