##### 



SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-K/A

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

For the fiscal year ended December 31, 2002Commission File No. 1-11775

TIMCO AVIATION SERVICES, INC.

(Exact name of registrant as specified in its charter)

|                                                                        |  |                                               
|----------------------------------------------------------------------- |  | ----------------------------------------------
|DELAWARE
(State or other jurisdiction of
incorporation or organization) |  | 65-0665658
(I.R.S Employer Identification No.)
|                                                                       
|623 Radar Road
Greensboro, NC
(Address of principal executive offices)  |  | 27410
(Zip Code)                              

(336) 668-4410
(Registrants telephone number)

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

|                         |  |                                              
|------------------------ |  | ---------------------------------------------
|TITLE OF EACH CLASS
None |  | NAME OF EACH EXCHANGE
ON WHICH REGISTERED
N/A

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

Common Stock, par value $.001 per share

Indicate by check mark whether the registrant (1) 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 periods 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 o





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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/A or any amendment to
this Form 10-K/A.   o

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act, Rule 12b-2).   
Yes o   
No x

Purpose

This Form 10-K/A to the 2002 Form 10-K of TIMCO Aviation Services, Inc. (the
Company) is being filed to report the information required by Items 10, 11,
12 and 13 of Part III of Form 10-K. All share information contained in this
Form 10-K/A reflects completion of the one-share-for-ten-shares reverse
stock split that became effective on February 28, 2002.

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PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

Board of Directors

Our certificate of incorporation and bylaws presently provide for a board of
directors divided into three classes, as equal in size as possible, with
staggered terms of three years. At the date of this Form 10-K, the current
members of the board and the expiration of their terms as directors are as
follows:

|                   |  |     |    |          |  |                                                   |  |  |      | 
|------------------ |  | --- | -- | -------- |  | ------------------------------------------------- |  |  | ---- | 
|Name               |  | Age |    | Position |  | Term Expires                                     
|                   |  |     |    |          |  |                                                  
|Roy T. Rimmer, Jr. |  |     | 61 |          |  | Chairman of the Board and Chief Executive Officer |  |  | 2004 | 
|Stephen E. Gorman  |  |     | 47 |          |  | Director                                          |  |  | 2003 | 
|Steven L. Gerard   |  |     | 58 |          |  | Director                                          |  |  | 2003 | 
|Jack J. Hersch     |  |     | 45 |          |  | Director                                          |  |  | 2003 | 
|Philip B. Schwartz |  |     | 49 |          |  | Director and Corporate Secretary                  |  |  | 2003 | 

Business Experience

Roy T. Rimmer, Jr. has been our Chairman and Chief Executive Officer since June
2001 and has been a director since January 2000. Prior to becoming our
Chairman and Chief Executive Officer, for more than the last five years Mr.
Rimmer was a private investor and the operator of a private company in the
business of transporting crude oil and natural gas. Mr. Rimmer serves on our
board as a representative of Lacy J. Harber, our principal stockholder.

Steven L. Gerard has been the Chairman and Chief Executive Officer of Century
Business Services Inc. (CBIZ), a diversified services company providing
professional outsourced business services, since October 2002. Prior thereto,
from October 2000, Mr. Gerard was CEO and a director of CBIZ. Before joining CBIZ, from 1997 to October 2000 Mr. Gerard was the Chairman and Chief Executive
Officer of Great Point Capital, Inc., a provider of operational and advisory
services, and from 1991 to 1997 Mr. Gerard was Chairman and Chief Executive
Officer of Triangle Wire and Cable, Inc. and its successor, Ocean View Capital,
Inc., a manufacturer of insulated wire and cable. Mr. Gerards prior
experience includes 16 years in various senior corporate finance and banking
positions with Citibank, N.A. and seven years with the American Stock Exchange.
Mr. Gerard has been a director since September 2000 and also serves on the
boards of directors of Fairchild Company, Inc., Lennar Corporation and Joy
Global, Inc.

Stephen E. Gorman has recently been named the President and Chief Executive
Officer of Greyhound Lines, Inc. Prior to joining Greyhound in July 2003, from
August 2001 to June 2003 Mr. Gorman was the President, North America for Krispy
Kreme Doughnuts, Inc. responsible for all store operations in North America.
Prior to joining Krispy Kreme, Mr. Gorman spent five years with Northwest
Airlines, Inc. at which he most recently held the position of Executive Vice
President of Technical Operations and Flight Operations, with responsibility
for all aircraft maintenance operations, pilot operations, operations planning
and control, dispatch and flight simulator operations. Prior to joining
Northwest Airlines in 1996, Mr. Gorman held a variety of senior executive
positions over nine years with Aviall, Inc., a major provider of third party
aviation services. Mr. Gorman is also on the board of directors of Rohn
Industries, Inc., an infrastructure provider in the telecommunications
industry. Mr. Gorman has been a director since October 2001.

Jack J. Hersch is a private investor. From 2000 to January 2003, Mr. Hersch
was a partner at Cypress Management, LP, a hedge fund. Prior to joining
Cypress, from 1996 to 2000 Mr. Hersch was a partner of Scoggin Capital
Management, LP, and from 1994 to 1996 Mr. Hersch was a Senior Vice President of
Donaldson, Lufkin & Jenrette. Over the last few years, Mr. Hersch has been
actively involved in investing in the securities of several aviation and
aviation services businesses, including TIMCO Aviation Services. Mr. Hersch
joined our board on February 28, 2002 and serves on our board as a
representative of the holders of our 8% senior subordinated convertible PIK
notes due 2006 (Senior Notes).

Philip B. Schwartz is an attorney with the law firm of Akerman, Senterfitt &
Eidson, P.A. Mr. Schwartz is a member of The Florida Bar and the American Bar
Association and a former Chair of the Business Law Section of The Florida Bar.
Akerman Senterfitt performs legal services for TIMCO Aviation Services. Mr.
Schwartz has been a director since June 1998 and Corporate Secretary since
March 1999.

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Compensation of Directors

Each director who is not an employee of ours receives an annual retainer fee at
the rate of $25,000 per year for serving in such capacity, and meeting fees of
$2,000 for each regular meeting and $1,000 for each special meeting of the
board and committees. Directors also receive quarterly option grants to
purchase 6,250 shares of common stock.

Executive Officers

The following list reflects our executive officers, as of the date of this Form
10-K, the capacity in which they serve us, and when they assumed office:

|                   |  |     |    |          |  |                                                         |  |               
|------------------ |  | --- | -- | -------- |  | ------------------------------------------------------- |  | --------------
|Name               |  | Age |    | Position |  | Executive Officer Since                                
|                   |  |     |    |          |  |                                                        
|Roy T. Rimmer, Jr. |  |     | 61 |          |  | Chairman and Chief Executive Officer                    |  | June 2001     
|Gil West           |  |     | 41 |          |  | President and Chief Operating Officer                   |  | September 2001
|C. Robert Campbell |  |     | 58 |          |  | Executive Vice President and Chief Financial Officer    |  | January 2002  
|Jack M. Arehart    |  |     | 48 |          |  | Senior Vice President of Business Development           |  | February 2002 
|Fritz Baumgartner  |  |     | 41 |          |  | Vice President, Controller and Chief Accounting Officer |  | February 2002 

Business Experience

The business experience of Roy T. Rimmer, Jr. is included above under Business
Experience of the Board of Directors.

Gil West is our President and Chief Operating Officer. Mr. West joined us in
September 2001 as our Executive Vice President and Chief Operating Officer, and
in January 2002 Mr. West was appointed to serve as our President. Prior to
joining us, Mr. West served as an executive at Northwest Airlines since 1996.
In his most recent position as Northwests Vice President of Engine and
Component Technical Operations, Mr. West managed over 2,000 Northwest
maintenance employees in Northwests Minneapolis and Atlanta maintenance
facilities, as well as managing outside vendor maintenance operations. Prior
to joining Northwest, Mr. West served in various managerial positions with
United Airlines, Rohr Industries, Sundstrand Corporation and Boeing Commercial
Aircraft.

C. Robert Campbell joined us in January 2002 as our Executive Vice President
and Chief Financial Officer. Mr. Campbell has over 20 years of senior
financial management experience. Most recently, from 1998 to 2000, Mr.
Campbell was the President and Chief Executive Officer of BAX Global, Inc., a
provider of air freight, ocean freight and supply chain management services,
and from 1995 to 1998, Mr. Campbell was the Executive Vice President, Finance
and Chief Financial Officer of Advantica Restaurant Group, Inc., a food
services company. Prior to joining Advantica, Mr. Campbell held various senior
management positions with Ryder System, Inc., a transportation and logistics
company, including CFO of its Vehicle Leasing and Services Division.

Jack M. Arehart joined us in February 2002 as our Senior Vice President of
Business Development, responsible for all of our sales, marketing and new
business development efforts. Prior to joining us, Mr. Arehart spent 14 years with The
Nordam Group, a large aviation manufacturing and MR&O services company, where,
since 1996, Mr. Arehart held the position of Vice President, Program
Development.

Fritz Baumgartner joined us in February 2002 and is our Vice President,
Controller and Chief Accounting Officer. Mr. Baumgartner was previously the
Chief Financial Officer and Vice President, Finance of Vitafoam, Inc., a
manufacturer of cellular polymers and non-woven fiber products. Prior to
joining Vitafoam, from 1990 to 1999, Mr. Baumgartner held various management
positions including Controller, Treasurer & Director of Reporting, MIS Director
and Vice President of Sales Operations with two Clayton, Dubilier & Rice
holdings (Remington Arms, Inc. and Pilliod Furniture, Inc.). From 1983 to 1990
Mr. Baumgartner was with Ernst & Young LLP, most recently as an audit manager.

Family Relationships

There are no family relationships between or among any of the directors and/or
executive officers.

Section 16(A) Beneficial Ownership Reporting Compliance

Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to
us pursuant to Rule 16a-3(e) under the Securities Exchange Act of 1934, as
amended, during our fiscal year ended December 31, 2002, and any Form 5 and
amendments thereto furnished to us with respect to our most recent fiscal year,
and any written representations referred to in subparagraph (b) (2) (i) of Item
405 of Regulation S-K, except as set forth below, to our knowledge, no person
who at any time during the fiscal year ended December 31, 2002 was our
director, officer or, to our knowledge, a beneficial owner of more than 10% of
any class of our equity securities registered pursuant to Section 12 of the
Exchange Act failed to file on a timely basis, as disclosed in Forms 3, 4 and
5, reports required by Section 16 (a) of the Exchange Act during

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the fiscal year ended December 31, 2002 with the following exception: each filing required by each director
and executive officer relating to 2002 was filed late.

ITEM 11. EXECUTIVE COMPENSATION.

The following Summary Compensation Table sets forth information about the
compensation paid or accrued during 2002, 2001 and 2000 to our Chief Executive
Officer and to each of our four other most highly compensated executive
officers whose aggregate direct compensation exceeded $100,000:

|                               |  |             |      |        |  |                     |         |                        |  |        |         |              |  |                  |   |                       |  |        |   |         |  |  |         |     |  |  |   |  |  |  |   | 
|------------------------------ |  | ----------- | ---- | ------ |  | ------------------- | ------- | ---------------------- |  | ------ | ------- | ------------ |  | ---------------- | - | --------------------- |  | ------ | - | ------- |  |  | ------- | --- |  |  | - |  |  |  | - | 
|                               |  |             |      |        |  | Annual
Compensation |         | Long
Term Compensation |  |        |         |             
|                               |  |             |      |        |  |                     |         |                        |  |        |         |             
|                               |  |             |      |        |  |                     |         |                        |  |        |         |              |  |                  |   |                       |  | Awards |   |         |  |  |         |    
|                               |  |             |      |        |  |                     |         |                        |  |        |         |              |  |                  |   |                       |  |        |   | Payouts |  |  |         |    
|Name and                       |  | Fiscal Year |      |        |  |                     |         |                        |  |        |         | Other Annual |  | Restricted Stock |   | Securities Underlying |  | LTIP   |   |         |  | 
|Principal Position             |  | Ending      |      | Salary |  | Bonus               |         | Compensation           |  | Awards |         | Options/SARs |  | Payouts          |   | Other                
|                               |  |             |      |        |  |                     |         |                        |  |        |         |              |  |                  |   |                      
|Roy T. Rimmer, Jr. (1)         |  |             | 2002 |        |  |                     | 441,346 |                        |  |        |        |              |  |                  |  |                       |  |        |  |         |  |  | 800,000 | (3) |  |  |  |  |  |  |  | 
|Chairman and CEO               |  |             | 2001 |        |  |                     | 156,154 |                        |  |        | 500,000 | (2)          |  |                  |  |                       |  |        |  |         |  |  |        |     |  |  |  |  |  |  |  | 
|                              
|C. Robert Campbell (4)         |  |             | 2002 |        |  |                     | 236,365 |                        |  |        | 201,655 |              |  |                  |  |                       |  |        |  |         |  |  | 200,000 |     |  |  |  |  |  |  |  | 
|Chief Financial Officer        |  |             |      |        |  |                     |         |                        |  |        |         |              |  |                  |   |                       |  |        |   |         |  |  |         |     |  |  |   |  |  |  |   | 
|                              
|Gil West (5)                   |  |             | 2002 |        |  |                     | 335,422 |                        |  |        |        |              |  |                  |  |                       |  |        |  |         |  |  | 600,000 |     |  |  |  |  |  |  |  | 
|President and COO              |  |             | 2001 |        |  |                     | 114,266 |                        |  |        | 371,406 |              |  |                  |  |                       |  |        |  |         |  |  |        |     |  |  |  |  |  |  |  | 
|                              
|Jack M. Arehart (6)            |  |             | 2002 |        |  |                     | 302,182 |                        |  |        |        |              |  |                  |  |                       |  |        |  |         |  |  | 500,000 |     |  |  |  |  |  |  |  | 
|Sr. VP of Business Development |  |             |      |        |  |                     |         |                        |  |        |         |              |  |                  |   |                       |  |        |   |         |  |  |         |     |  |  |   |  |  |  |   | 
|                              
|Michael C. Brant (7)           |  |             | 2002 |        |  |                     | 69,185  |                        |  |        | 187,500 |              |  |                  |  |                       |  |        |  |         |  |  |        |     |  |  |  |  |  |  |  | 
|Former CFO                     |  |             | 2001 |        |  |                     | 216,461 |                        |  |        | 62,500  |              |  |                  |  |                       |  |        |  |         |  |  |        |     |  |  |  |  |  |  |  | 
|                               |  |             | 2000 |        |  |                     | 232,667 |                        |  |        | 120,000 |              |  |                  |  |                       |  |        |  |         |  |  | 10,000  |     |  |  |  |  |  |  |  | 



| | (1) |  | Mr. Rimmer became our Chairman and Chief Executive Officer in June
2001. In March 2002, we and Mr. Rimmer entered into a three-year
employment agreement. See Employment Agreements below.                                                                                                                                                                                                  
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (2) |  | Bonus was granted to Mr. Rimmer in March 2002 for 2001 services
relating to our restructuring.                                                                                                                                                                                                                                                                                                
|
| | (3) |  | Mr. Rimmer received this option grant pursuant to his employment
agreement.                                                                                                                                                                                                                                                                                                                   
|
| | (4) |  | Mr. Campbell joined us in January 2002. Mr. Campbell has an
employment agreement with us. Pursuant thereto, Mr. Campbell received a
signing bonus, which is the bonus reflected in the table. Mr. Campbell
also received an option grant under his employment agreement that,
pursuant to his agreement, was issued at the completion of our
restructuring. See Employment Agreements below.
|
| | (5) |  | Mr. West joined us in August 2001. Mr. West has an employment
agreement with us. Pursuant thereto, Mr. West received a signing bonus,
which is the bonus reflected in the table. Mr. West also received an
option grant under his employment agreement that, pursuant to his
agreement, was issued at the completion of our restructuring. See
Employment Agreements below.                 
|
| | (6) |  | Mr. Arehart joined us in February 2002. Mr. Arehart has an
employment agreement with us. Pursuant thereto, Mr. Arehart received an
option grant under his employment agreement that, pursuant to his
agreement, was issued at the completion of our restructuring. See
Employment Agreements below.                                                                                         
|
| | (7) |  | Mr. Brant resigned as our Chief Financial Officer in January 2001.
Mr. Brant was granted a retention bonus in connection with the fall 2001
move of our corporate headquarters to Greensboro, N.C., a portion of
which ($62,500) was paid in 2001 and the balance of which ($187,500) was
paid in March 2002.                                                                                 

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Option Grants During Last Fiscal Year

The following table sets forth information concerning options to purchase
shares of common stock granted during the fiscal year ended December 31, 2002
to the current employees named in the Summary Compensation Table above.

|                   |  |                    |         |                     |  |                    |      |                 |  |        |      |         |  |                                 |         |                                     |  |                               |         |  |  |  |         | 
|------------------ |  | ------------------ | ------- | ------------------- |  | ------------------ | ---- | --------------- |  | ------ | ---- | ------- |  | ------------------------------- | ------- | ----------------------------------- |  | ----------------------------- | ------- |  |  |  | ------- | 
|                   |  |                    |         |                     |  |                    |      |                 |  |        |      |         |  |                                 |         |                                     |  | Potential Realizable Value at
|                   |  |                    |         |                     |  | % of Total Options |      |                 |  |        |      |         |  |                                 |         | Assumed Annual Rates of Stock Price
|                   |  | Number of Shares   |         | Granted to          |  |                    |      |                 |  |        |      |         |  | Appreciation for Option Term(1)
|                   |  | Underlying Options |         | Employees in Fiscal |  | Exercise Price     |      |                 |  |        |      |        
|Name               |  | Granted            |         | Year                |  | ($/Share)          |      | Expiration Date |  | 5% ($) |      | 10% ($)
|                   |  |                    |         |                     |  |                    |      |                 |  |        |      |        
|Roy T. Rimmer      |  |                    | 800,000 |                     |  |                    | 26.8 | %               |  |        | 1.02 |         |  |                                 | 3/20/07 |                                     |  |                               | 225,446 |  |  |  | 498,176 | 
|C. Robert Campbell |  |                    | 200,000 |                     |  |                    | 6.7  | %               |  |        | 0.83 |         |  |                                 | 2/28/07 |                                     |  |                               | 45,863  |  |  |  | 101,345 | 
|Gil West           |  |                    | 600,000 |                     |  |                    | 20.1 | %               |  |        | 0.83 |         |  |                                 | 2/28/07 |                                     |  |                               | 137,588 |  |  |  | 304,034 | 
|Jack M. Arehart    |  |                    | 500,000 |                     |  |                    | 16.7 | %               |  |        | 0.83 |         |  |                                 | 2/28/07 |                                     |  |                               | 114,657 |  |  |  | 253,362 | 



---

| | (1) |  | These amounts represent assumed rates of appreciation in the price of
common stock during the term of the options in accordance with rates
specified in applicable federal securities regulations. Actual gains,
if any, on stock option exercises will depend on the future price of
common stock and overall stock market conditions. There is no
representation that the rates of appreciation reflected in the table
will be achieved.
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Aggregate Option Exercises During Fiscal 2002 and Fiscal Year End Option Values

The following table sets forth information concerning the exercise of stock
options to purchase common stock during the 2002 fiscal year and the value of
unexercised stock options to purchase common stock at the end of the 2002
fiscal year for the current employees named in the Summary Compensation Table.

|                   |  |                      |   |          |  |                        |   |                            |  |                  |         |                      |  |  |     | 
|------------------ |  | -------------------- | - | -------- |  | ---------------------- | - | -------------------------- |  | ---------------- | ------- | -------------------- |  |  | --- | 
|                   |  |                      |   |          |  |                        |   |                            |  | Number of Shares |         | Value of Unexercised
|                   |  | Number of            |   | Value    |  | Underlying Unexercised |   | In-The-Money Options      
|                   |  | Shares               |   | Realized |  | Options at Fiscal      |   | At Fiscal Year-End($)     
|Name               |  | Acquired on Exercise |   | ($)      |  | Year-End               |   | Exercisable/Unexercisable*
|                   |  |                      |   |          |  |                        |   |                           
|Roy T. Rimmer, Jr. |  |                      |  |          |  |                        |  |                            |  |                  | 266,667 |                      |  |  | 0/0 | 
|C. Robert Campbell |  |                      |  |          |  |                        |  |                            |  |                  | 66,667  |                      |  |  | 0/0 | 
|Gil West           |  |                      |  |          |  |                        |  |                            |  |                  | 400,000 |                      |  |  | 0/0 | 
|Jack M. Arehart    |  |                      |  |          |  |                        |  |                            |  |                  | 166,667 |                      |  |  | 0/0 | 



---

| | * |  | Computed based upon the difference between the closing price of common stock
at December 31, 2002 and the exercise price. All options were out-of-the-money
on December 31, 2002, and no value has been assigned to options that are
out-of-the-money.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Employment Agreements

We have employment agreements with our executive officers. Each provides for
the payment of a base salary (Rimmer  $425,000; West  $300,000; Arehart
 $300,000; Campbell  $240,000) plus bonus compensation (a percentage of their
base compensation) based on the Company meeting an objective performance
standard established annually by the Board. Each employment agreement also
provides for a stock option grant vesting 1/3 upon issuance, 1/3 on the first
anniversary of the respective employment agreement and 1/3 on the second
anniversary of the respective employment agreement. Each employment agreement
also contains a change of control severance arrangement if the employee is
not retained in our employment after a change of control.

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Stock Option Plans

Our board of directors and stockholders adopted a new stock option plan in
February 2002 (the 2001 stock option plan). Since the approval of the 2001
stock option plan, no new options were granted under our 1996 stock option plan
and our 1996 director stock option plan, and any shares of common stock
reserved for issuance upon the exercise of options that were not issued under
such plans were cancelled. However, the terms of any option issued under the
1996 stock option plan and the 1996 director stock option plan will continue to
be governed by such plans and by the option agreements currently in effect for
such options.

Pursuant to the 2001 stock option plan, an aggregate amount of 2.4 million
shares of our common stock are reserved for issuance upon exercise of options
granted thereunder. The option price per share of common stock may be any
price determined by the 2001 stock option plan administrators, except that
incentive stock option grants may not be less than fair market value per share
of common stock on the date of grant (or not less than 110% of the fair market
value for stockholders who own more than 10% of the companys stock).

The compensation committee administers our stock option plan. The compensation
committee determines which persons will receive options and the number of
options to be granted to such persons. The compensation committee also
interprets the provisions of the stock option plan and makes all other
determinations that it deems necessary or advisable for the administration of
the stock option plan.

Pursuant to the 2001 stock option plan we may grant incentive stock options as
defined in Section 422(b) of the Internal Revenue Code of 1986, as amended,
(the Code), and non-qualified stock options, not intended to qualify under
Section 422(b) of the Code. The price at which our common stock may be
purchased upon the exercise of options granted under the 2001 stock option plan
will be required to be at least equal to the per share fair market value of the
common stock on the date the particular options are granted. Options granted
under the 2001 stock option plan may have maximum terms of not more than 10
years and are not transferable, except by will or the laws of descent and
distribution. None of the incentive stock options under the stock option plan
may be granted to an individual owning more than 10% of the total combined
voting power
of all classes of stock issued by us unless the purchase price of the common
stock under such option is at least 110% of the fair market value of the shares
issuable on exercise of the option determined as of the date the option is
granted, and such option is not exercisable more than five years after the
grant date.

Generally, options granted under the 2001 stock option plan may remain
outstanding and may be exercised at any time up to three months after the
person to whom such options were granted is no longer employed or retained by
us or serving on our board of directors.

Pursuant to the 2001 stock option plan, unless otherwise determined by the
compensation committee, one-third of the options granted to an individual are
exercisable on the first anniversary of such grant, one-third are exercisable on
the second anniversary of such grant and the final one-third are exercisable on
the third anniversary of such grant. However, our board has the discretion to
make appropriate adjustments, including accelerating the vesting, to the
outstanding options granted under the 2001 stock option plan if we undergo a
change of control. A change in control of
TIMCO is generally deemed to
occur when (a) any person (other than our majority-owned subsidiary, our
compensation plan or any person (other than our majority-owned subsidiary, our
compensation plan or Lacy Harber and his affiliates) becomes the beneficial
owner of or acquires voting control with respect to more than 20% of the common
stock; (b) a change occurs in the composition of a majority of our board of
directors during a two-year period, provided that a change with respect to a
member of our board of directors shall be deemed not to have occurred if the
appointment of a member of our board of directors is approved by a vote of at
least 75% of the individuals who constitute the then existing board of
directors; or (c) our stockholders approve the sale of all or substantially all
of our assets.

Incentive stock options granted under the 2001 stock option plan are subject to
the restriction that the aggregate fair market value (determined as of the date
of grant) of options, which first become exercisable in any calendar year
cannot exceed $100,000 per individual.

The 2001 stock option plan provides for appropriate adjustment to the number
and type of shares covered by such options granted thereunder in the event of
any reorganization, merger, recapitalization or certain other transactions
involving us.

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As of May 31, 2003, options to purchase 2,393,750 shares had been granted under
the 2001 Stock Option Plan (1,562,500 of which are currently vested), 1,300,000
of which had been granted to our executive officers (866,667 of which are
currently vested). Additionally, options to purchase 800,000 shares had been
granted to one of our executive officers outside of the 2001 Stock Option Plan,
533,333 of which are currently vested. Further options to purchase 273,236
shares remain outstanding under previous option plans and agreements.

Compensation Committee Interlocks and Insider Participation

During the fiscal 2002, no members of our compensation committee is or was a
current or former employee. Except as set forth in Item 13. Certain
Relationships and Related Transactions, during the last fiscal year there were
no material transactions between the Company and any of the members of the
Compensation Committee.

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

At May 31, 2003, we had 31,640,994 shares of our common stock outstanding. The
following table sets forth certain information regarding the shares of common
stock owned of record or beneficially by (i) each person who owns beneficially
more then 5% of our outstanding common stock; (ii) each of our directors and
current executive officers; and (iii) all directors and executive officers as a
group.

|                                                                 |  |                               |            |            |  |  |      |  
|---------------------------------------------------------------- |  | ----------------------------- | ---------- | ---------- |  |  | ---- | -
|                                                                 |  | Shares Beneficially Owned (1)
|                                                                 |  |                              
|Name                                                             |  | Number                        |            | Percentage
|                                                                 |  |                               |            |           
|Lacy J. Harber (2)                                               |  |                               | 34,068,355 |            |  |  | 72.2 | %
|Roy T. Rimmer, Jr. (3)                                           |  |                               | 34,763,688 |            |  |  | 72.9 | %
|Steven L. Gerard (4)                                             |  |                               | 32,750     |            |  |  | *    |  
|Stephen E. Gorman (4)                                            |  |                               | 32,250     |            |  |  | *    |  
|Jack Hersch (5)                                                  |  |                               | 35,250     |            |  |  | *    |  
|Philip B. Schwartz (6)                                           |  |                               | 52,900     |            |  |  | *    |  
|Gil West (7)                                                     |  |                               | 400,000    |            |  |  | 1.3  |  
|Jack Arehart (8)                                                 |  |                               | 333,333    |            |  |  | 1.1  |  
|C. Robert Campbell (9)                                           |  |                               | 133,333    |            |  |  | *    |  
|All directors and executive officers as a group  9
persons (10) |  |                               | 35,783,504 |            |  |  | 73.6 | %



|
|
|
|
|
|
|

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| | (3)  |  | Mr. Rimmer shares the power to vote the securities owned by LJH
Corporation (by virtue of a proxy) and has certain
rights to participate in the proceeds of certain sales of LJHs shares.
Also includes 106,250 shares owned by an entity controlled by Mr.
Rimmer and vested warrants and options to purchase an aggregate of
589,083
shares (533,333 shares at an exercise price of $1.02 per share, 6,250
shares at an exercise price of $.8325 per share, 6,250 shares at an
exercise price of $1.83 per share, 6,250 shares at an exercise price of
$0.91 per share, 6,250 shares at an exercise price of $0.70 per share,
6,250 shares at an exercise price of $0.56 per share, 12,500 shares at an
exercise price of $5.16 per share and 12,000 shares at exercise prices
ranging from $17.00 per share to $153.13 per share). Excludes unvested
options to purchase 266,667 shares at an exercise price of $1.02 per share.
| | ---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (4)  |  | Consists of vested options to purchase shares of common stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (5)  |  | Mr. Hersch owns 4,000 shares individually and holds warrants to
purchase an additional 31,250 shares at an exercise
price ranging from $0.56 per share to $1.83 per share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| | (6)  |  | Mr. Schwartz owns 12,870 shares and holds options and warrants to
purchase an additional 40,030 shares (31,250
shares at exercise prices ranging from $0.56 to $1.83 and the balance at
exercise prices ranging from $5.16 per share
to $395 per share).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | (7)  |  | Vested options to purchase 400,000 shares at an exercise price of
$.8325 per share. Excludes unvested options to
purchase 200,000 shares at an exercise price of $.8325 per share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | (8)  |  | Vested options to purchase 333,333 shares at an exercise price of
$.8325 per share. Excludes unvested options to
purchase 166,667 shares at an exercise price of $.8325 per share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | (9)  |  | Vested options to purchase 133,333 shares at an exercise price of
$.8325 per share. Excludes unvested options to
purchase 66,667 shares at an exercise price of $.8325 per share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | (10) |  | Includes vested options to
purchase an aggregate of 17,106,919 shares.
Excludes unvested options to purchase an
aggregate of 700,001 shares of common stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

Equity Compensation Plans

The following table summarizes information, as of December 31, 2002,
relating to our equity compensation plans pursuant to which grants of options,
restricted stock, restricted stock units or other rights to acquire shares may
be granted from time to time.

|                                                              |  |                              |           |                              |  |                                      |       |                                |  |           |       | 
|------------------------------------------------------------- |  | ---------------------------- | --------- | ---------------------------- |  | ------------------------------------ | ----- | ------------------------------ |  | --------- | ----- | 
|                                                              |  |                              |           |                              |  |                                      |       |                                |  | Number of
|                                                              |  | Number of securities         |           |                              |  |                                      |       | securities remaining available
|                                                              |  | to be issued upon            |           | Weighted-average exercise    |  | for future issuance under           
|                                                              |  | exercise of outstanding      |           | price of outstanding         |  | equity compensation plans (excluding
|Plan category                                                 |  | options, warrants and rights |           | options, warrants and rights |  | securities reflected in column (a)) 
|                                                              |  |                              |           |                              |  |                                     
|                                                              |  | (a)                          |           | (b)                          |  | (c)                                 
|Equity compensation
plans approved by securityholders         |  |                              | 2,666,986 |                              |  | $                                    | 22.29 |                                |  |           | 6,250 | 
|Equity compensation
plans not approved
by security holders(1) |  |                              | 800,000   |                              |  |                                      | 0.25  |                                |  |           | 0     | 
|                                                              |  |                              |           |                              |  |                                      |       |                                |  |           |       | 
|Total                                                         |  |                              | 3,466,986 |                              |  | $                                    | 22.54 |                                |  |           | 6,250 | 



---

| | (1) |  | Options granted outside of any plan to our Chief Executive Officer.
| | --- |  | -------------------------------------------------------------------

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##### 



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

As of December 2, 1994, we entered into a 20-year lease with Aviation
Properties, a Delaware general partnership (Aviation Properties), pursuant to
which we leased our corporate headquarters and warehouse in Miami, Florida (the
Miami Property). We were obligated to make annual payments under such lease
in the amount of approximately $893,000. Aviation Properties was an entity
controlled by Robert Alpert, a former principal stockholder and director of
TIMCO. In connection with the purchase of the Miami Property, we loaned
Aviation Properties $2.5 million and the loan was being repaid with interest at
the rate of 8% per annum. In January 2001, we sold the loan to Lacy Harber, our
principal stockholder, for 90% of the then outstanding balance of $2.0 million.
In connection with his purchase of the loan, Mr. Harber received a warrant to
purchase 2,500 shares at an exercise price of $36.25 per share. In March 2001,
the Miami Property was sold and we were relieved of our remaining obligation
under the lease agreement.

During 2000, 2001 and 2002, we leased certain real property from entities
controlled by one of our former directors and executive officers, Ben Quevedo.
These facilities were previously utilized as the headquarters of two of our
MR&O operations. We have subsequently moved out of these facilities, although
we remain liable on the leases. We recently subleased one of these facilities
and are currently taking actions to defray our obligations under the second
lease. During 2000, 2001 and 2002, we also utilized aircraft owned by an entity
controlled by Mr. Quevedo. Payments for all of these items were approximately
$2.7 million in 2000, $400,000 in 2001, and $300,000 in 2002.

In February 2001, we obtained a term loan from a financial institution. In
connection with obtaining the term loan, four individuals provided credit
support to the financial institution that advanced the loan. In return for
providing credit support, each of these individuals (or entities under their
control) were granted warrants to purchase 25,000 shares of our common stock at
an exercise price of $40.00 per share. Those providing credit support to the
financial institution were Ben Quevedo, a former executive officer and director of our company, Robert
Alpert, a former director and principal stockholder of our company, Don A. Sanders and Lacy
Harber, our majority stockholder.

In April and May 2001, Messrs. Harber and Alpert provided credit support to us
relating to our tax retention operating lease financing and with respect to a
short-term increase in the above-described term loan. In return for providing
such credit support, Mr. Alpert received a warrant to purchase 5,000 shares at
an exercise price of $17.50 per share and Mr. Harber received warrants to
purchase 5,000 shares and 33,333 shares at exercise prices of $17.50 and $14.00
per share, respectively.

We utilize an aircraft owned by Roy T. Rimmer, Jr., our Chairman and Chief
Executive Officer. Total expenses incurred in relation to this utilization
during 2002 was $311,000.

In July 2002, Mr. Harber and Don Sanders provided credit support to us
relating to our restructured $5.0 million Bank of America Term Loan. In return
for providing such credit support, each of these parties received a warrant to
purchase 750,000 (1.5 million in the aggregate) shares at an exercise price of
$1.05 per share.

In October 2002, we completed the purchase of the outstanding stock of Brice
Manufacturing Company (Brice) for the purchase price of $1.272 million and
the assumption of approximately $1.385 million of liabilities. We financed
the purchase of Brice through a loan of $1.3 million from Mr. Harber. The
note to Mr. Harber was unsecured, bore interest at LIBOR plus 5.5% and was due
on the earlier of January 31, 2004 or the termination of the revolving credit
facility. Additionally, Mr. Harber agreed to loan the Company additional
amounts equal to the Companys costs relating to the Brice acquisition and
amount required to fund any monthly shortfalls of earnings before interest,
taxes, depreciation and amortization (EBITDA) from Brices operations. From
the date of acquisition through December 31, 2002, there has been approximately
$60,000 of funding requirements. The terms of this loan were modified
in May
2003 (see below).

Also in October 2002, we sold our real estate and fixtures located at our
Aircraft Interior Design, Inc. (AID) operation in Dallas, Texas, to Mr. Harber.
The gross sales price for these assets was approximately $2.4 million, which
was the estimated fair market value, based on a third party appraisal, on the
sale date. Simultaneous with the sale, we entered into a lease agreement with
Mr. Harber for substantially all of these assets. The term of this lease is
ten years. Annual rental payments are approximately $300,000 per year, with
the Company being responsible for, among other things, taxes, insurance and
utilities.

10



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##### 



In December 2002, Mr. Harber purchased the operating
assets of Aviation Management Systems, Inc. (AMS) located in Phoenix,
Arizona. Additionally, Mr. Harber assumed a lease with the City of Phoenix
for facilities previously leased by AMS at Goodyear Airport. We have entered
into an operating sublease agreement with Mr. Harber to operate the business in
the facilities that were previously leased to AMS. The term of the sublease is
for three years with rental payments of $432,000 annually. Under the
sublease agreement, we are also responsible for insurance, taxes and charges
leaved by the City of Phoenix.

In May 2003, we entered into an agreement with Mr. Harber pursuant to which he
agreed to loan the Company $6.0 million. The new note has a three-year
maturity, is secured debt, and bears a 16% PIK interest coupon. In connection
with the new loan, we issued a warrant to Mr. Harber to acquire, for nominal
consideration, 30% of the Companys outstanding common stock (on a
fully-diluted basis) as of the day the warrant is exercised. The warrant is
exercisable until January 31, 2007. Further, the $1.3 million loan received
from Mr. Harber in connection with the Brice acquisition has been added to this
$6.0 million new loan, and the Keepwell agreement, which, among other matters,
Mr. Harber had issued to the Companys senior lenders in connection with the
Brice acquisition and required monthly funding of any EBITDA losses, was
eliminated. Finally, the note relating to this new loan has been increased by
$850,000 reflecting our purchase from Mr. Harber of the aircraft parts
inventory located at the Goodyear facility (which inventory was acquired by Mr.
Harber in the AMS bankruptcy proceeding). The purchase price of the inventory
that we purchased from Mr. Harber was less than the fair market value of such
inventory (based on a third party appraisal).

Mr. Schwartz is a stockholder in Akerman, Senterfitt & Eidson, P.A., which has
in the past and continues to perform significant legal services for us. The
fees paid by us to Akerman, Senterfitt & Eidson, P.A. for legal services
rendered are no greater than those that would be charged to us by an unrelated
third party law firm.

We believe that the terms of the above-described related party transactions
were no less favorable than could be obtained from unaffiliated third parties.

11



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##### 



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.

|                             |  |                                                          |  |              
|---------------------------- |  | -------------------------------------------------------- |  | -------------
|TIMCO AVIATION SERVICES, INC |  |                                                         
|(Registrant)                 |  |                                                         
|                             |  |                                                          |  |              
|BY:                          |  | /s/ Roy T. Rimmer, Jr.                                   |  | July 17, 2003
|                             |  |                                                          |  |              
|                             |  | Roy T. Rimmer, Jr., Chairman and Chief Executive 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.

|                                                                                                  |  |              
|------------------------------------------------------------------------------------------------- |  | -------------
|SIGNATURE AND TITLE:                                                                              |  | DATE:        
|                                                                                                  |  |              
|/s/ Roy T. Rimmer, Jr.                                                                            |  | July 17, 2003
|                                                                                                  |  |              
|Roy T. Rimmer, Jr.                                                                                |  |              
|Chairman and Chief Executive Officer
(Principal Executive Officer)                                |  |              
|                                                                                                  |  |              
|/s/ Gil West                                                                                      |  | July 17, 2003
|                                                                                                  |  |              
|Gil West                                                                                          |  |              
|President (Principal Operating Officer)                                                           |  |              
|                                                                                                  |  |              
|/s/ C. Robert Campbell                                                                            |  | July 17, 2003
|                                                                                                  |  |              
|C. Robert Campbell                                                                                |  |              
|Executive Vice President and
Chief Financial Officer
(Principal Financial and Accounting Officer) |  |              

12



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##### 



|                       |  |              
|---------------------- |  | -------------
|SIGNATURE AND TITLE:   |  | DATE:        
|                       |  |              
|/s/ Jack Hersch        |  | July 17, 2003
|                       |  |              
|Jack Hersch            |  |              
|Director               |  |              
|                       |  |              
|/s/ Philip B. Schwartz |  | July 17, 2003
|                       |  |              
|Philip B. Schwartz     |  |              
|Director               |  |              
|                       |  |              
|/s/ Steven L. Gerard   |  | July 17, 2003
|                       |  |              
|Steven L. Gerard       |  |              
|Director               |  |              
|                       |  |              
|/s/ Stephen E. Gorman  |  | July 17, 2003
|                       |  |              
|Stephen E. Gorman      |  |              
|Director               |  |              

13