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EXHIBIT 99.1
KELLSTROM INDUSTRIES, INC.
FOR IMMEDIATE RELEASE
KELLSTROM ANNOUNCES A $30 MILLION FINANCING FROM KEY PRINCIPAL PARTNERS
Sunrise, FL - November 16, 2000 -- Kellstrom Industries, Inc. [NASDAQ: KELL]
today announced that it has secured a $30 million financing with Key Principal
Partners ("Key"), LLC, a $600 million investment fund and an affiliate of Key
Corporation of Cleveland, Ohio. The financing is in the form of a 7-year
subordinated debt financing and is an important step in the recapitalization of
the Company. The Company will utilize approximately $12.7 million of the
proceeds to repay the subordinated debt currently held by Equitable Life
Assurance Society of the United States, which funded the Company's acquisition
of International Aircraft Support in 1997. The balance initially will be used to
pay down the senior credit facility as well as to finance future growth. This
financing provides for an interest rate of 13% and includes an agreement to
issue warrants, in variable amounts under certain conditions, to purchase shares
of the Company's common stock.
Yoav Stern, Kellstrom's Chairman of the Board noted, "We are pleased to be
joining forces with such supportive, sophisticated investors as Key Principal
Partners. The Key debt maturity extends more than 4 years beyond the maturity of
our existing convertible debentures, which mature in 2 to 3 years. This
transaction is another step the Company is taking to re-align its debt
structure. In addition to providing us with greater financial flexibility to
address the repayment of our convertible debentures, this investment will
augment our ability to fund the planned growth of our business. As previously
announced, this round of financing may fund a portion of the acquisition and
related transaction costs for the parts resale business of Aviation Sales. We
continue to work to satisfy the various conditions to closing the AVS
transaction."
Commenting, Oscar Torres, Kellstrom's CFO, stated, "In connection with prepaying
the Equitable loan, we will record a one-time extraordinary charge in the fourth
quarter of approximately $2.2 million, of which $1.3 million is non-cash. The
non-cash portion of the charge is related to the write-off of unamortized
original transaction costs incurred in January 1997. The $0.9 million cash
portion of the charge represents a prepayment fee pursuant to our original
agreement with Equitable. Overall, this is a very positive move for Kellstrom as
it reinforces the stability of our balance sheet and helps facilitate the future
growth of the Company."
(more)
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Kellstrom Industries, Inc. News Release
Page 2
November 16, 2000
Kellstrom Industries, Inc. is a leader in delivering innovative and value added
nose-to-tail programs in the fields of inventory control and supply chain
management to the international aviation market. This is achieved by uniting
cutting edge information technology with quality assurance methodology. The
Company specializes in providing engines and parts for large turbo-fan engines
manufactured by CFMI, General Electric, Pratt & Whitney and Rolls Royce, in
addition to components for the aircraft they power. Kellstrom is also a leading
inventory management and components provider of engines and parts for large
military transport aircraft, jet fighters and helicopters. The Company is an
approved supplier to an international customer base including major domestic and
international airlines, military air forces, original equipment manufacturers
and engine overhaul shops.
STATEMENTS MADE IN THIS PRESS RELEASE RELATING TO MATTERS THAT ARE NOT
HISTORICAL FACTS, INCLUDING STATEMENTS REGARDING MANAGEMENT'S EXPECTATIONS
CONCERNING THE COMPANY'S ABILITY TO FUND FUTURE GROWTH AND ACQUISITIONS, ARE
FORWARD-LOOKING STATEMENTS. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON MANY
ASSUMPTIONS AND FACTORS, AND ARE SUBJECT TO MANY CONDITIONS, INCLUDING THE
COMPANY'S CONTINUING ABILITY TO EFFECTIVELY INTEGRATE THE ACQUIRED COMPANIES,
ACQUIRE ADEQUATE INVENTORY AND TO OBTAIN FAVORABLE PRICING FOR SUCH INVENTORY,
THE ABILITY TO ARRANGE FOR THE REPAIR OF AIRCRAFT ENGINES BY THIRD-PARTY
CONTRACTORS PRIOR TO RESALE OR LEASE, COMPETITIVE PRICING FOR THE COMPANY'S
PRODUCTS, CUSTOMER CONCENTRATION, DEMAND FOR THE COMPANY'S PRODUCTS WHICH
DEPENDS UPON THE CONDITION OF THE AIRLINE INDUSTRY, ABILITY TO COLLECT
RECEIVABLES, GOVERNMENT REGULATION, THE EFFECTS OF INCREASED INDEBTEDNESS AS A
RESULT OF THE COMPANY'S BUSINESS ACQUISITIONS, THE AVAILABILITY OF CAPITAL TO
FUND CURRENT OPERATIONS, GROWTH AND ACQUISITION STRATEGIES, THE COMPANY'S
ABILITY TO REMAIN IN COMPLIANCE WITH THE TERMS AND COVENANTS CONTAINED IN ITS
FINANCING AGREEMENTS, INCLUDING THE AGREEMENT WITH KEY PRINCIPAL PARTNERS, AND
OTHER RISKS DETAILED FROM TIME TO TIME BY THE COMPANY, INCLUDING THOSE SET FORTH
IN THE COMPANY'S FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE FORM
10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2000, AND OTHER DOCUMENTS FILED BY THE
COMPANY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION. EXCEPT FOR THE
HISTORICAL INFORMATION CONTAINED IN THIS RELEASE, ALL FORWARD-LOOKING
INFORMATION ARE ESTIMATES BY THE COMPANY'S MANAGEMENT AND ARE SUBJECT TO VARIOUS
RISKS AND UNCERTAINTIES THAT MAY BE BEYOND THE COMPANY'S CONTROL AND MAY CAUSE
RESULTS TO DIFFER FROM MANAGEMENT'S CURRENT EXPECTATIONS.
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CONTACT: OR KELL'S INVESTOR RELATIONS COUNSEL:
Kellstrom Industries, Inc. (954) 845-0427 The Equity Group Inc.
Zivi R. Nedivi, Pres. & CEO Linda Latman (212) 836-9609
Michael Shokouhi, Director of Investor Relations Bob Goldstein (212) 371-8660
Oscar Torres, CFO WWW.THEEQUITYGROUP.COM
WWW.KELLSTROM.COM ----------------------
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