EXHIBIT 10.20 Distribution and Indemnity Agreement dated as of November 23,
1993 between Ryder System, Inc. and Aviall, Inc.
2

DISTRIBUTION AND INDEMNITY AGREEMENT

BETWEEN

RYDER SYSTEM, INC.

and

AVIALL, INC.

DISTRIBUTION AND INDEMNITY AGREEMENT

TABLE OF CONTENTS

ARTICLE I. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Section 1.01 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE II. THE DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Section 2.01 The Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.02 Cooperation Prior to the
Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.03 Conditions to Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.04 Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

ARTICLE III. TRANSACTIONS RELATING TO
THE DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Section 3.01 Intercorporate Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.02 Repayment of Intercompany
Indebtedness and Payment
of Dividend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 3.03 Distribution Statement
and Settlement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 3.04 Tax Sharing Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 3.05 Employee Benefits Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 3.06 Services Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 3.07 The Aviall Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 3.08 Aviall Charter and Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 3.09 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 3.10 Use of Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.11 Disposition of Businesses Held for
Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 3.12 Release of Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

ARTICLE IV. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Section 4.01 Indemnification by Ryder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 4.02 Indemnification by Aviall . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 4.03 Limitations on Indemnification
Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 4.04 Procedures for Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 4.05 Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 4.06 Survival of Indemnities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

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ARTICLE V. ACCESS TO INFORMATION; SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Section 5.01 Provision of Corporate Records . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 5.02 Access to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.03 Production of Witnesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.04 Retention of Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.05 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 5.06 Provision of Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

ARTICLE VI. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Section 6.01 Complete Agreement; Construction . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.02 Survival of Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.03 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.04 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.05 Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 6.06 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 6.07 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 6.08 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 6.09 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.10 No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.11 Titles and Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.12 Legal Enforceability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

SCHEDULE 3.01 Subsidiaries
SCHEDULE 4.01 Ryder Indemnification
SCHEDULE 4.02 Aviall Indemnification

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DISTRIBUTION AND INDEMNITY AGREEMENT

DISTRIBUTION AND INDEMNITY AGREEMENT (this "Agreement"), dated as of
November 23, 1993, between RYDER SYSTEM, INC., a Florida corporation ("Ryder")
and AVIALL, INC., a Delaware corporation and, as of the date hereof, a wholly
owned subsidiary of Ryder ("Aviall").

WHEREAS, the Ryder Board has determined that it is appropriate and
desirable to transfer to a single corporation the aviation services businesses
previously conducted by certain direct and indirect Subsidiaries (as defined
below) of Ryder and to distribute to the stockholders of Ryder on a pro rata
basis all of Ryder's interest in such corporation; and

WHEREAS, such distribution is intended to qualify as a tax-free
spin-off under Section 355 of the Internal Revenue Code of 1986, as amended;
and

WHEREAS, Ryder and Aviall have determined that it is appropriate and
desirable to set forth the principal corporate transactions required to effect
such distribution and certain other agreements that will govern certain matters
relating to such distribution;

NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained in this Agreement, the parties hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 General. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):

Action: any action, suit, arbitration, inquiry, proceeding or
investigation by or before any court, any governmental or other regulatory or
administrative agency or commission or any arbitration tribunal.

Affiliate: as defined in Rule 12b-2 under the Exchange Act, including
with respect to Aviall any Aviall Subsidiary and with respect to Ryder any
Ryder Subsidiary.

Agent: The First National Bank of Boston, as distribution agent.

Aviall Common Stock: the Common Stock, par value $.01 per share, of
Aviall.

Aviall Subsidiary: any Subsidiary of Ryder or Aviall that will be a
Subsidiary of Aviall immediately following the Distribution Date, and any other
Subsidiary of Aviall which thereafter may be organized or acquired.

Code: the Internal Revenue Code of 1986, as amended.

Commission: the Securities and Exchange Commission.

Distribution: the distribution to holders of Ryder Stock of the shares
of Aviall Common Stock owned by Ryder on the Distribution Date.

Distribution Date: the date determined by the Ryder Board on which the
Distribution shall be effected.

Employee Benefit Plan: an employee welfare benefit plan or an employee
pension benefit plan as defined in Sections 3(1) and 3(2) of ERISA or a plan
which is both an employee welfare benefit plan and an employee pension benefit
plan.

Employee Benefits Agreement: the Employee Benefits Agreement between
Ryder and Aviall, the form of which is attached hereto as Annex A.

ERISA: the Employee Retirement Income Security Act of 1974, as
amended, or any successor legislation.

Exchange Act: the Securities Exchange Act of 1934, as amended.

Form 10: the registration statement on Form 10 filed by Aviall with
the Commission to effect the registration of the Aviall Common Stock pursuant
to the Exchange Act.

Information Statement: the information statement to be sent to the
holders of Ryder Stock in connection with the Distribution.

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Insurance Proceeds: those monies (i) received by an insured from an
insurance carrier or (ii) paid by an insurance carrier on behalf of the
insured, in either case net of any applicable premium adjustments (including
reserves) or retrospectively rated premium adjustments.

IRS: the Internal Revenue Service.

Liabilities: any and all debts, liabilities and obligations, absolute
or contingent, matured or unmatured, liquidated or unliquidated, accrued or
unaccrued, known or unknown, whenever arising (unless otherwise specified in
this Agreement), including all costs and expenses relating thereto, and
including, without limitation, those debts, liabilities and obligations arising
under any law, rule, regulation, Action, threatened Action, order or consent
decree of any governmental entity or any award of any arbitrator of any kind,
and those arising under any contract, commitment or undertaking including those
arising under this Agreement.

Losses: any and all losses, Liabilities, claims, damages, obligations,
payments, costs and expenses, matured or unmatured, absolute or contingent,
accrued or unaccrued, liquidated or unliquidated, known or unknown (including,
without limitation, the costs and expenses of any and all Actions, threatened
Actions, demands, assessments, judgments, settlements and compromises relating
thereto and attorneys' fees and any and all expenses whatsoever reasonably
incurred in investigating, preparing or defending against any such Actions or
threatened Actions).

Record Date: the close of business on the date to be determined by the
Ryder Board as the record date for the Distribution.

Ryder Board: the Board of Directors of Ryder.

Ryder Stock: the Common Stock, $.50 par value, of Ryder.

Ryder Subsidiary: any Subsidiary of Ryder other than Aviall or any
Aviall Subsidiary, including any Subsidiary of Ryder following the Distribution
Date and any other Subsidiary of Ryder which thereafter may be organized or
acquired.

Separated Employee: any individual who, on or prior to the
Distribution Date, was employed by Ryder or any of its Subsidiaries (including,
without limitation, Aviall or

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any Aviall Subsidiaries) and who, on or after the Distribution Date, or
otherwise in connection with the Distribution, remains or, within 60 days after
the Distribution Date, becomes, as the case may be, employed by Aviall or any
Aviall Subsidiary, including any beneficiary or dependent of such individual,
as applicable.

Services Agreement: the Services Agreement between Ryder and Aviall,
the form of which is attached hereto as Annex B.

Subsidiaries: the term "Subsidiaries" as used herein with respect to
any entity shall, unless otherwise indicated, be deemed to refer to both direct
and indirect subsidiaries of such entity.

Tax Sharing Agreement: the Tax Sharing Agreement between Ryder and
Aviall, the form of which is attached hereto as Annex C.

ARTICLE II

THE DISTRIBUTION

Section 2.01 The Distribution. Subject to Section 2.03 hereof, on or
prior to the Distribution Date, Ryder will deliver to the Agent for the benefit
of holders of record of Ryder Stock on the Record Date, a single stock
certificate, endorsed by Ryder in blank, representing all of the then
outstanding shares of Aviall Common Stock owned by Ryder, and shall cause the
transfer agent for the Ryder Stock to instruct the Agent to distribute on the
Distribution Date (or as soon as practicable thereafter) the appropriate number
of such shares of Aviall Common Stock to each such holder or designated
transferee or transferees of such holder. The Distribution shall be effective
as of 5:00 P.M., New York City time, on the Distribution Date. Aviall will
provide to the Agent all share certificates and any information required in
order to complete the Distribution on the basis of one share of Aviall Common
Stock for each four shares of Ryder Stock outstanding on the Record Date,
subject to Section 2.04 hereof.

Section 2.02 Cooperation Prior to the Distribution.

(a) Ryder and Aviall have prepared, and Ryder shall mail, prior to
the Distribution Date, to the holders of Ryder Stock, the Information
Statement, which shall set forth

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appropriate disclosure concerning Aviall, the Distribution and other matters.
Ryder and Aviall have prepared, and Aviall has filed with the Commission, the
Form 10, which includes or incorporates by reference the Information Statement.
Ryder and Aviall shall use reasonable efforts to cause the Form 10 to become
effective under the Exchange Act as soon as practicable.

(b) Ryder and Aviall shall cooperate in preparing, filing with the
Commission and causing to become effective any registration statements or
amendments thereof which are required to reflect the establishment of, or
amendments to, any employee benefit and other plans contemplated by the
Distribution and this Agreement.

(c) Ryder and Aviall shall take all such action as may be
necessary or appropriate under the securities or blue sky laws of states or
other political subdivisions of the United States, in connection with the
transactions contemplated by this Agreement.

(d) Ryder and Aviall have prepared, and Aviall has filed in
preliminary form and shall seek to make effective, an application to permit the
listing of the Aviall Common Stock on the New York Stock Exchange (the
"Exchange").

Section 2.03 Conditions to Distribution. This Agreement and the
consummation of each of the transactions provided for herein shall be subject
to approval of the Ryder Board in its discretion. The Ryder Board shall in its
discretion establish the Record Date and the Distribution Date and all
appropriate procedures in connection with the Distribution, but in no event
shall the Distribution Date occur prior to such time as each of the following
have occurred or have been waived by the Ryder Board in its discretion: (i)
the regulatory approvals and all other material consents which are required to
effect the Distribution shall have been received; (ii) the Ryder Board shall
have formally approved the Distribution; (iii) the Form 10 shall have been
declared effective by the Commission; (iv) Ryder shall have received a
favorable response from the Staff of the Commission to its request for a
no-action letter concerning, among other matters, whether the Distribution may
be effected without registration of the Aviall Common Stock under the
Securities Act of 1933; (v) the Ryder Board shall have received an opinion of
counsel satisfactory to it that the Distribution will be a tax-free "spin-off"
under Section 355 of the Code; (vi) the Board of Directors of Aviall, comprised
as contemplated by Section 3.07, shall have been duly elected, and the
Certificate of Incorporation and the Bylaws of Aviall, as described

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in Section 3.08, shall have been adopted and be in effect; (vii) the Aviall
Common Stock shall have been accepted for listing by the Exchange; (viii) the
transactions contemplated by Sections 3.01 and 3.02 shall have been consummated
in all material respects; and (ix) Aviall shall have arranged for a bank credit
facility which provides funding for the transactions contemplated by Section
3.02 and for Aviall's working capital needs following the Distribution;
provided that the satisfaction of such conditions shall not create any
obligation on the part of Ryder or any other party hereto to effect the
Distribution or in any way limit Ryder's power of termination set forth in
Section 6.09 or alter the consequences of any such termination from those
specified in such Section.

Section 2.04 Fractional Shares. The parties agree that the Agent
shall be directed as soon as practicable after the Distribution Date to
determine the number of whole shares and fractional shares of Aviall Common
Stock allocable to each holder of record of Ryder Stock as of the Record Date,
to aggregate all such fractional shares and sell the whole shares obtained
thereby at then prevailing prices and to cause to be distributed to each such
holder to which a fractional share shall be allocable such holder's ratable
share of the proceeds of such sale, after making appropriate deductions of the
amount required to be withheld for federal income tax purposes and after
deducting an amount equal to all brokerage charges, commissions and transfer
taxes attributed to such sale.

ARTICLE III

TRANSACTIONS RELATING TO THE DISTRIBUTION

Section 3.01 Intercorporate Reorganization.

(a) Immediately prior to the Distribution, Ryder shall transfer,
directly and indirectly, all of the outstanding capital stock of the direct and
indirect Subsidiaries of Ryder listed on Schedule 3.01 hereto to Aviall as a
contribution to the capital of Aviall. The transfer of capital stock shall be
effected by means of delivery of stock certificates duly endorsed or
accompanied by duly executed stock powers and notation on the stock records
books of the corporation or other legal entities involved and, to the extent
required by applicable law, by notation on appropriate registries.

(b) Prior to the Distribution Date, Ryder and Aviall shall take all
steps necessary to increase the outstanding shares of Aviall Common Stock so
that immediately

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prior to the Distribution, Ryder will hold a number of shares of Aviall Common
Stock equal to one-quarter of the number of shares of Ryder Stock outstanding
on the Record Date.

Section 3.02 Repayment of Intercompany Indebtedness and Payment of
Dividend.

(a) Immediately prior to the Distribution, all net intercompany
indebtedness, including accrued interest in respect thereof (including, without
limitation, (i) any amounts advanced to Aviall by Ryder pursuant to subsection
(c) of this Section 3.02 and (ii) any adjustments to such net intercompany
indebtedness to be made pursuant to Sections 3.03(b) and (c) hereof) owing
between Ryder and the Ryder Subsidiaries, on the one hand, and Aviall and the
Aviall Subsidiaries, on the other hand, as of the close of business on the last
day of the month immediately preceding the month in which the Distribution Date
occurs (the "Prior Month End"), as reflected in the Distribution Statement (as
defined in Section 3.03(a)), shall be paid in full (the "Debt Repayment").

(b) Prior to the Distribution, and subject to subsection (e) of this
Section 3.02, the Aviall Subsidiaries shall pay cash dividends (the "Special
Dividends" and, together with the Debt Repayment, the "Ryder Payments") to
Ryder. The Special Dividend Amount shall equal the amount, if any, by which
(i) Ryder's Investment (as defined below) in Aviall and the Aviall Subsidiaries
as of the Prior Month End, as reflected in the Distribution Statement (which
shall include the after tax earnings of Aviall's foreign Subsidiaries for the
month ending on the Prior Month End) exceeds (ii) Aviall's Projected Net Book
Value (as defined below). Projected Net Book Value shall equal $314 million
reduced (or increased) by the product of (x) the net after-tax income (losses)
projected for Aviall and the Aviall Subsidiaries for the month in which the
Distribution Date occurs, as reflected in Schedule 3.03(a) and (y) a fraction,
the numerator of which is the number of calendar days from and including the
day immediately following the Prior Month End through and including the
Distribution Date, and the denominator of which is the total number of calendar
days in the month in which the Distribution Date occurs. Ryder's Investment
means the book value of the consolidated assets of Aviall and the Aviall
Subsidiaries less the book value of the consolidated liabilities of Aviall and
the Aviall Subsidiaries.

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(c) If requested by Aviall, Ryder will provide advances to Aviall, or
accept repayment of advances from Aviall, during the period from the Prior
Month End to the day prior to the Distribution Date.

(d) The parties agree and acknowledge that as of the Distribution Date
and other than as expressly contemplated by this Agreement and other than
charges for goods and services actually rendered, exclusive of the management
fee payable to Ryder, Aviall and the Aviall Subsidiaries shall cease making
payments to Ryder or any Ryder Subsidiary and Ryder and the Ryder Subsidiaries
shall cease making loans or advances to or investments in Aviall or any Aviall
Subsidiary.

(e) The parties further agree and acknowledge that
in no event shall the aggregate amount of the Ryder Payments exceed $450
million.

Section 3.03 Distribution Statement and Settlement.

(a) Ryder shall deliver to Aviall, no later than three business days
prior to the Distribution Date, a statement of the Ryder Payments (the
"Distribution Statement"). The Distribution Statement shall be prepared from
the consolidated financial statements of Ryder, which financial statements will
be in accordance with generally accepted accounting principles ("GAAP"),
applied consistently in all material respects with Ryder's accounting policies
and practices in effect as of the Distribution Date, except for the inclusion
of the after tax earnings of Aviall's foreign Subsidiaries for the month ending
on the Prior Month End and except as shall be adjusted to reflect the
transactions to be effected in connection with the Distribution which are set
forth in Schedule 3.03(a) hereto. The Distribution Statement shall not reflect
decisions or actions of management of Aviall after the Distribution Date,
including without limitation discontinuance of lines of business, dispositions
of assets and facility closings. Aviall agrees to fully cooperate with Ryder
by providing to Ryder as promptly as practicable all information requested by
Ryder to prepare the Distribution Statement.

(b) For purposes of Section 3.02(a), the intercompany indebtedness
owed to Ryder by Aviall as of the Prior Month End shall be deemed to be
adjusted to reflect the transactions to be effected in connection with the
Distribution which are set forth in Schedule 3.03(a).

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(c) If there are any items related to the Distribution Statement which
are in dispute, then such items shall be submitted to KPMG Peat Marwick ("Peat
Marwick") for resolution. For purposes of dispute resolution, the accounting
policies followed by Ryder up to and including the Distribution Date with
respect to the businesses to be transferred to Aviall shall prevail, so long as
such policies comply with GAAP. All fees and expenses, if any, for dispute
resolution work to be performed by Peat Marwick shall be borne equally by Ryder
and Aviall. Peat Marwick shall act as an arbitrator to determine, based solely
on presentations by Ryder and Aviall, and not by independent review, only those
issues still in dispute.

Section 3.04 Tax Sharing Agreement. On or prior to the Distribution
Date, (i) Ryder and Aviall will execute and deliver the Tax Sharing Agreement
and (ii) Aviall and the Aviall Subsidiaries will transfer to Ryder all income
tax reserves relating to non-temporary items for which Ryder has assumed
responsibility under the Tax Sharing Agreement.

Section 3.05 Employee Benefits Agreement. On or prior to the
Distribution Date, Ryder and Aviall will execute and deliver the Employee
Benefits Agreement.

Section 3.06 Services Agreement. On or prior to the Distribution
Date, Ryder and Aviall will execute and deliver the Services Agreement.

Section 3.07 The Aviall Board. Aviall and Ryder shall take all
actions which may be required to elect or otherwise appoint as directors of
Aviall, on or prior to the Distribution Date, the persons named in the Form 10
to constitute the Board of Directors of Aviall on the Distribution Date.

Section 3.08 Aviall Charter and Bylaws. Prior to the Distribution
Date, (a) Ryder shall cause the Certificate of Incorporation of Aviall,
substantially in the form of Annex C to the Form 10, to be filed with the
Secretary of State of the State of Delaware and to be in effect on the
Distribution Date, and (b) the Board of Directors of Aviall shall adopt the
Bylaws of Aviall substantially in the form of Annex D to the Form 10.

Section 3.09 Insurance.

(a) Ryder has historically provided insurance coverage to Aviall and
Aviall Subsidiaries through various policies maintained by Ryder for the
benefit of itself and its

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Subsidiaries for workers' compensation, general liability, fire and other types
of losses. Aviall and Aviall Subsidiaries have made payments to Ryder to
reimburse Ryder for their pro rata share of any premiums paid to third parties
by Ryder to provide such insurance, with deductibles, and for varying limits of
liability. Ryder will use reasonable efforts to continue to provide such
coverage in accordance with its past practice to Aviall and Aviall Subsidiaries
from the date such coverage first commenced until 5:00 P.M. on the Distribution
Date or such later date as may be agreed to in writing by Ryder and Aviall and
accepted by the relevant insurers, and Aviall shall make payments to Ryder to
reimburse Ryder for its pro rata share of any premiums for such coverage in
accordance with the past practice established by Ryder and Aviall and Aviall
Subsidiaries. To the extent that losses by Aviall are not covered by such
third-party insurers, Ryder will not be required to reimburse Aviall for such
losses.

(b) Ryder shall use reasonable efforts to assist Aviall and Aviall
Subsidiaries in obtaining initial insurance coverage for Aviall and Aviall
Subsidiaries from and after the Distribution Date in such amounts as are agreed
upon by the parties. Following the Distribution Date, each of the parties
shall cooperate with and assist the other party in the prevention of conflicts
or gaps in insurance coverage and/or collection of proceeds. The parties
acknowledge that Ryder is the named insured on the aviation liability policies
which cover claims made in respect of services rendered to or products sold to
customers of Aviall and Aviall Subsidiaries, and the parties agree to use
reasonable efforts to assign such policies to Aviall effective as of the
Distribution Date and to have Aviall become the named insured under such
policies, with Ryder being an additional insured thereunder.

(c) Ryder and Aviall agree that (i) Aviall shall have the right to
present claims to Ryder or Ryder's insurers under all policies of insurance
placed by Ryder on Aviall's and Aviall Subsidiaries' behalf, or which include
Aviall or Aviall Subsidiaries within them, and (ii) Ryder shall submit such
claims to Ryder's insurers on a timely basis or shall assist Aviall in the
submission of such claims to such insurers. The parties agree that certain
policies are written on an "occurrence" basis and may provide coverage to
Aviall and Aviall Subsidiaries for incidents occurring prior to the
Distribution Date even though the claim was first made after the Distribution
Date and that other policies are written on a "claims made" rather than
"occurrence" basis and that such policies may not provide coverage to Aviall
and

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Aviall Subsidiaries for incidents occurring prior to the Distribution Date but
which are first reported after the Distribution Date.

(d) With respect to any insured Losses or retroactive premium
adjustments relating to assets and/or operations of Aviall and/or Aviall
Subsidiaries prior to the Distribution Date or such later date as may be agreed
to pursuant to Section 3.09(a) hereof: Ryder shall pay over to Aviall any
Insurance Proceeds (or, in the case of workers' compensation insurance,
Aviall's pro rata share of such proceeds) it receives on account of such
Losses, net of the amount of any applicable premium adjustments,
retrospectively-rated premium adjustments or other costs which are paid or
estimated by Ryder to be paid by Ryder in the ordinary course of business and
any costs incurred by Ryder in collecting such proceeds. If Ryder's estimate
of such adjustments or other costs proves to be too small or too great, the
difference between the estimate and the actual adjustments and other costs
shall be paid back to Ryder or over to Aviall, respectively, within one year
after the initial payment of insurance proceeds is made.

(e) Ryder and Aviall agree that each was insured for workers'
compensation in the state of Texas under a retrospective rating program during
the twelve-month periods beginning on October 1, 1987 and October 1, 1988 by
Transportation Insurance Company under policies 001602763 and 001606338. These
policies will require ongoing premium adjustments until such time as all claims
are closed and Ryder and Transportation Insurance Company agree to a final
settlement. Ryder's Risk Management Department will continue to reconcile any
retrospective or other premium calculations in accordance with the
retrospective rating formula and past practices and will provide Aviall with
data supporting the allocation of premiums between Aviall and Ryder.

Section 3.10 Use Of Name.

(a) Use of RYDER Name and Mark. Aviall acknowledges that Ryder owns
all rights in the RYDER name and mark and that within six months after the
Distribution Date, Aviall and any Aviall subsidiary will cease all use of the
RYDER name and mark as part of any corporate name, trade name, and/or trademark
or service mark, including, without limitation, on any signs, letterhead,
business cards, invoices and other business forms, telephone directory
listings, and advertising and promotional materials. During the six-month
period after the Distribution Date in which any use of the RYDER name or mark
is used by Aviall on

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preexisting signs and printed materials, Ryder will rely on Aviall to maintain
the same standards of quality as previously exercised by Aviall.

(b) Use of AVIALL Name and Mark. Ryder acknowledges that Aviall owns
all rights in the AVIALL name and mark and that within six-months after the
Distribution Date, Ryder and any Ryder subsidiary will cease all use of the
AVIALL name and mark as part of any corporate name, trade name, and/or
trademark or service mark, including, without limitation, on any signs,
letterhead, business cards, invoices and other business forms, telephone
directory listings, and advertising and promotional materials. During the six
month period after the Distribution Date in which any use of the AVIALL name or
mark is used by Ryder on preexisting signs or printed materials, Aviall will
rely on Ryder to maintain the same standards of quality as previously exercised
by Ryder.

Section 3.11 Disposition of Businesses Held for Sale.

(a) Upon the closing of the sale of all of the Businesses Held for
Sale (as defined below) and the collection or sale of the accounts receivable
retained by Aviall following the closing of the sale of any such Businesses and
related thereto, or otherwise pursuant to subsections (d) and (e) hereof, and
upon satisfaction of the conditions set forth in subsection (b) hereof, but in
no event later than September 30, 1994, Aviall (i) shall pay to Ryder the first
$25 million of the Proceeds (as defined below) attributable to such sale(s) in
excess of the aggregate book value of the assets so sold (excluding deferred
accumulated income taxes) of the Businesses Held for Sale (determined in
accordance with generally accepted accounting principles, consistently applied
and consistent with the presentation in the Aviall financial statements
included in the Form 10), with the book value of such assets of each such
Business determined as of the date of disposition of each such Business; (ii)
shall retain the next $10 million of the Proceeds exceeding such aggregate book
value; and (iii) shall pay to Ryder 80% of the Proceeds to the extent exceeding
such aggregate book value by more than $35 million (the amounts referred to in
clauses (i) and (iii) of this subsection (a) being referred to herein as the
"Proceeds Payment"); provided, however, that if the Proceeds Payment pursuant
to this Section 3.11 would exceed an aggregate of $50 million, then Aviall
shall pay to Ryder the sum of $50 million and in no event shall the Proceeds
Payment exceed such amount.

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(b) Any Proceeds Payment made pursuant to this Section 3.11 shall be
conditioned upon (i) there being Proceeds attributable to the sale of the
Businesses Held for Sale, plus cash collections in respect of, or sales of,
accounts receivable retained by Aviall following the closing of the sale of any
such Businesses and related to such Businesses, in an amount exceeding an
aggregate of $177 million, as adjusted for any increases or decreases as of the
date of the disposition of each such Business in the assets of such Businesses
from an aggregate asset value of all of the assets included in the Businesses
Held for Sale of $177 million; (ii) the repayment pursuant to Section 3.4(b) of
the Credit Agreement (the "Credit Agreement") governing Aviall's senior secured
credit facilities (the "Credit Facilities"), on or prior to the date the
Proceeds Payment is made, of not less than $135 million of principal
indebtedness incurred by Aviall on or prior to the Distribution Date under
Tranche A of the Credit Facilities; and (iii) there not being any Default or
Potential Default (as defined in the Credit Agreement), including any Default
or Potential Default that would arise as a result of the Proceeds Payment, as
of the date of the Proceeds Payment, which shall remain uncured and unwaived
from the time of any such Potential Default through and including the date of
the Proceeds Payment. To the extent that the aggregate liabilities assumed by
the buyer(s) of the Businesses Held for Sale are greater than $42 million,
Aviall will borrow up to an amount equal to the amount by which such
liabilities exceed $42 million (as increased or decreased by an amount equal to
the increase or decrease, as the case may be, referred to in clause (i) of this
subsection (b) adjusting the $177 million proceeds threshold for changes in
total asset levels) under the Revolving Credit Facility (as defined in the
Credit Agreement) to satisfy its obligations pursuant to clause (ii) of this
subsection (b).

(c) Aviall agrees that 100% of the purchase price paid for any
Business(es) Held for Sale shall be paid in cash and shall make provision with
any buyer(s) of such Businesses for such cash payment.

(d) Subject to the limitation set forth in the next sentence of this
subsection (d) and to the satisfaction of the conditions set forth in
subsection (b), at any time on or prior to September 30, 1994, Ryder shall have
the option, in its sole discretion, to elect to receive the Proceeds Payment
(as adjusted pursuant to the penultimate sentence of this subsection (d)) prior
to the consummation of the sale of all the Businesses Held for Sale (the
"Prepayment Election"). Ryder shall not be permitted to exercise the
Prepayment

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Election if the aggregate book value of the assets included in the Business(es)
Held for Sale (excluding deferred accumulated income taxes) with respect to
which a sale shall not have been consummated as of the date Ryder proposes to
make the Prepayment Election is greater than $15 million, with the book value
of each category of assets which have not been sold as of the date of the
proposed Prepayment Election being equal to the lesser of (x) the book value of
such unsold assets as of September 30, 1993 and (y) the book value of such
unsold assets on the date of the Prepayment Election. If Ryder makes a
Prepayment Election, the amount of the Proceeds Payment shall be calculated by
subtracting from the Proceeds attributable to sales of all Businesses Held for
Sale which are sold on or prior to the date of the Prepayment Election, the
book value of the assets which are so sold. In the event of any Prepayment
Election, Ryder shall not be entitled to any further payment from Aviall with
respect to any Business(es) Held for Sale which have not been sold at the time
of the Prepayment Election.

(e) If at September 30, 1994 or such earlier time as the Proceeds
Payment is made, any amount of Sale Proceeds is held in escrow or subject to a
deferred payment mechanism ("Deferred Proceeds"), then the Proceeds Payment
shall then be calculated on the basis of the Sale Proceeds which have
theretofore been received, and if the Proceeds Payment is made before the
disposition of the Deferred Proceeds is resolved, Aviall shall make
arrangements which are reasonably satisfactory to Ryder to provide for the
payment to Ryder, when and if the disposition of the Deferred Proceeds is
resolved, of an amount equal to Ryder's proportionate share of the Deferred
Proceeds, as determined pursuant to subsection (a). If the disposition of any
of the Businesses Held for Sale includes the payment of Deferred Proceeds, then
Aviall shall structure the payment of any such Deferred Proceeds such that
Ryder shall be a direct beneficiary of any escrow or similar deferred payment
mechanism.

(f) If post-closing adjustments (other than post-closing payments
arising as a result of the parties' indemnification obligations, excluding
indemnification obligations with respect to which payments are made on or prior
to September 30, 1994) are made (other than Deferred Proceeds paid pursuant to
subsection (e) above) pursuant to the purchase agreement(s) with respect to the
Businesses Held for Sale which, had they been taken into account at the
consummation of the transactions contemplated by such agreement(s), would
result in a change in the amount of the Proceeds Payment, then Ryder shall make
a payment to Aviall or Aviall shall make a payment to Ryder, as appropriate, to

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adjust the Proceeds Payment to the amount which would apply had such
post-closing adjustments been taken into account at the applicable consummation
of the transactions contemplated by such agreement(s).

(g) At any time on or prior to the earlier of the date on which Ryder
makes a Prepayment Election and September 30, 1994, Ryder shall have the
option, exercisable in its sole discretion, to purchase from Aviall all
accounts receivable retained by Aviall following the closing of the sale of any
of the Businesses Held for Sale and related to such Businesses. The purchase
price to be paid to Aviall for such accounts receivable shall be the book value
of such accounts on the date that Ryder exercises its option to purchase
pursuant to this subsection (g).

(h) Aviall covenants and agrees to use its best efforts to consummate
the sale(s) of the Businesses Held for Sale on or prior to September 30, 1994
and not to take any actions which would be inconsistent with a consummation on
or prior to such date, or which would result in depriving Ryder of the Proceeds
Payment. Aviall further covenants that, from and after the date hereof, Aviall
shall afford Ryder and its designated representatives full access to all
records, books, contracts, instruments, computer data and other data within
Aviall's and Aviall's accountants' and advisors' possession relating directly
or indirectly to any of the Businesses Held for Sale and shall make available
to Ryder, at Ryder's request and in Ryder's sole discretion, all personnel of
Aviall and of Aviall's accountants and advisors having information relating to
the Businesses Held for Sale or the sale process with respect to such
Businesses. Any information to which Ryder shall have had access pursuant to
this subsection (h) shall be treated as confidential pursuant to Section 5.05
of this Agreement.

(i) "Proceeds" shall mean the aggregate proceeds (the "Sale Proceeds")
received by Aviall, plus any liabilities assumed by the buyer in connection
with the sale of any assets of the Businesses Held for Sale, plus any amounts
arising pursuant to subsection (j), net of reasonable transaction costs and
expenses incurred in connection with the sale of any of the Businesses Held for
Sale to the extent such costs were not charged against an accrual related to
the Businesses Held for Sale.

(j) For purposes of determining the amount of the Proceeds Payment,
any accruals by Aviall attributable to the Businesses Held for Sale (as
described in the "Businesses Held for Sale and Restructuring Charges" note to
the Aviall

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Combined Financial Statements for the three years ended December 31, 1992 and
the nine months ended September 30, 1993) which are reversed or are to be
reversed (in either case, in whole or in part) in connection with the sale of
one or more of the Businesses Held for Sale and the transactions related
thereto shall increase, on a dollar-for-dollar basis, the Proceeds received by
Aviall for purposes of determining the allocation of such Proceeds pursuant to
this Section 3.11; provided, further, that, in determining the amount of such
Proceeds and the allocation thereof, the aggregate amount of all accruals
reversed (in whole or in part) by Aviall shall not be deemed to exceed an
aggregate of $10 million for purposes of increasing the amount of Proceeds.
Any net increases in reserves or in accruals after the Distribution Date, or
any new reserves or accruals established after the Distribution Date, shall be
disregarded and shall not be deemed to reduce the Proceeds attributable to the
Businesses Held for Sale for purposes of determining the amount of such
Proceeds and the allocation thereof pursuant to this Section 3.11.

(k) Aviall shall perform its obligations under Section 3.4(b) of the
Credit Agreement, and any subsequent amendment or waiver of such provision, or
of the defined terms used therein, from the provisions of such Section 3.4(b)
as in effect on the date hereof shall not be given effect for purposes of this
Section 3.11.

(l) For purposes of this Section 3.11, "Businesses Held for Sale"
shall mean Aviall's (i) Business Aviation/Forest Park Facility (including
Allison distribution rights); (ii) Burbank Facility; (iii) Allison 501 Program
Assets; (iv) Dallas/Love Field Fixed Base Operation; and (v) Aviation Sales
Unit.

(m) Aviall shall provide to Ryder, on a monthly basis, the following
schedules related to the status of the Businesses Held for Sale: (i) a
consolidating balance sheet showing in reasonable detail all of the assets and
liabilities of each of the Businesses Held for Sale; (ii) a consolidating
statement of operations showing in reasonable detail all of the revenues and
expenses of the Businesses Held for Sale (regardless of the fact that these
revenues and expenses are not included in Aviall's total results of
operations); (iii) a schedule of the accruals originally included in the $177.7
million loss on planned disposal of Businesses Held for Sale, which schedule
shall show the original June 30, 1993 accrual balances and the usage of each of
these accruals by month with reasonable explanation of each individual charge
against each of such accruals; and

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(iv) a schedule which reconciles the Proceeds received by Aviall on an interim
basis for any of the Businesses Held for Sale to the Proceeds Payment due Ryder
upon resolution of criteria listed in subsections (b) and (d), with all amounts
of Deferred Proceeds separately identified on such schedule. Any information
provided to Ryder under this subsection (m) shall be treated confidential
pursuant to Section 5.05 of this Agreement.

(n) In the event of any dispute between Ryder and Aviall regarding the
amount of the Proceeds Payment and if, at the time of such dispute, Peat
Marwick are the independent auditors for both Ryder and Aviall, Peat Marwick
shall review the calculations of the Proceeds Payment submitted by each of
Ryder and Aviall and shall act as arbitrator of any such dispute. If, at the
time of such dispute, Peat Marwick are not the independent auditors for both
Ryder and Aviall, then the parties shall select another nationally recognized
certified public accounting firm, which does not serve as independent auditors
for either Ryder or Aviall, to resolve any such dispute. All decisions of Peat
Marwick or such other firm shall be final, conclusive and legally binding on
Ryder and Aviall with respect to the amount of the Proceeds Payment. Each of
Ryder and Aviall shall pay one-half of the fees and expenses of Peat Marwick or
such other firm.

Section 3.12 Release of Guaranty.

(a) In addition to any other payment required to be made by Aviall to
Ryder in connection with the Distribution, and subject to subsection (b) of
this Section 3.12, on the Distribution Date and quarterly on the last day of
each quarter following the Distribution Date (each, a "Guaranty Payment Date"),
commencing on March 31, 1994, Aviall agrees to pay to Ryder an annual amount
equal to 2-3/4% of the aggregate principal amount of the Indebtedness (as
defined below) outstanding on any such Guaranty Payment Date (the "Guaranty
Fee"). The Guaranty Fee shall be payable in consideration of Ryder's
continuing guaranty (the "Guaranty") pursuant to the Guarantee Agreement dated
as of December 6, 1988 between European Investment Bank ("EIB") and Ryder
relating to certain indebtedness of Ryder Airline Services Limited (formerly
Caledonian Airmotive Limited) to EIB (the "Indebtedness"). As of the date
hereof, the aggregate principal amount of the Indebtedness was approximately
$25 million.

(b) The Guaranty Fee shall cease to be due and payable commencing on
the last day of the quarter in which the Guaranty shall have been released
pursuant to this Section 3.12.

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(c) Aviall covenants and agrees that it will cause itself or one or
more of its Affiliates to be substituted in all respects for Ryder, effective
on or prior to November 1, 1994, in respect of all obligations of Ryder under
the Guaranty. If Aviall is unable to effect such a substitution with respect
to the Guaranty after using its best efforts to do so, Aviall shall obtain
letters of credit, on terms and from financial institutions satisfactory to
Ryder and EIB, with respect to the Indebtedness covered by the Guaranty. As a
result of the substitution contemplated by the first sentence of this
subsection (c) or the letter or letters of credit contemplated by the second
sentence hereof, Ryder shall cease to have any obligation whatsoever arising
from or in connection with the Guaranty.

ARTICLE IV

INDEMNIFICATION

Section 4.01 Indemnification by Ryder. Except with respect to
employee benefits or other Liabilities to employees, which shall be governed by
the Employee Benefits Agreement, and except with respect to claims for which
Insurance Proceeds or other amounts are received, which shall be governed by
Sections 3.09(d) and 4.03 hereof, Ryder shall indemnify, defend and hold
harmless Aviall, each Affiliate of Aviall and each of their respective
directors, officers and employees and each of the heirs, executors, successors
and assigns of any of the foregoing (the "Aviall Indemnitees") from and against
any and all Losses of the Aviall Indemnitees arising out of or due to the
failure or alleged failure of Ryder or any of its Affiliates to pay, perform or
otherwise discharge any item set forth on Schedule 4.01 hereto. Anything in
this Section 4.01 to the contrary notwithstanding, neither Ryder nor any Ryder
Subsidiary shall have any liability whatsoever to either Aviall or any Aviall
Subsidiary in respect of any Tax (as such term is defined in the Tax Sharing
Agreement), except as otherwise provided in the Tax Sharing Agreement.

Section 4.02 Indemnification by Aviall. Except with respect to
employee benefits or other Liabilities to employees, which shall be governed by
the Employee Benefits Agreement, and except with respect to claims for which
Insurance Proceeds or other amounts are received, which shall be governed by
Sections 3.09(d) and 4.03 hereof, Aviall shall indemnify, defend and hold
harmless Ryder, each Affiliate of Ryder and each of their respective directors,
officers and employees and each of the heirs, executors, successors and

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assigns of any of the foregoing (the "Ryder Indemnitees") from and against any
and all Losses of the Ryder Indemnitees arising out of or due to the failure or
alleged failure of Aviall or any of its Affiliates to pay, perform or otherwise
discharge any item set forth on Schedule 4.02 hereto. Anything in this Section
4.02 to the contrary notwithstanding, neither Aviall nor any Aviall Subsidiary
shall have any liability whatsoever to either Ryder or any Ryder Subsidiary in
respect of any Tax, except as otherwise provided in the Tax Sharing Agreement.

Section 4.03 Limitations on Indemnification Obligations. The amount
which any party (an "Indemnifying Party") is or may be required to pay to any
other party (an "Indemnitee") pursuant to Section 4.01 or Section 4.02 shall be
reduced (including, without limitation, retroactively) by any Insurance
Proceeds or other amounts actually recovered by or on behalf of such
Indemnitee, in reduction of the related Loss. If an Indemnitee shall have
received the payment required by this Agreement from an Indemnifying Party in
respect of any Loss and shall subsequently actually receive Insurance Proceeds
or other amounts in respect of such Loss, then such Indemnitee shall pay to
such Indemnifying Party a sum equal to the amount of such Insurance Proceeds or
other amounts actually received (up to but not in excess of the amount of any
indemnity payment made hereunder). An insurer who would otherwise be obligated
to pay any claim shall not be relieved of the responsibility with respect
thereto, or, solely by virtue of the indemnification provisions hereof, have
any subrogation rights with respect thereto, it being expressly understood and
agreed that no insurer or any other third party shall be entitled to a
"windfall" (i.e., a benefit they would not be entitled to receive in the
absence of the indemnification provisions) by virtue of the indemnification
provisions hereof.

Section 4.04 Procedures for Indemnification.

Procedures for Indemnification of Third Party Claims. Procedures for
Indemnification of Third Party Claims shall be as follows:

(a) If an Indemnitee shall receive notice or otherwise learn of the
assertion by a Person (including, without limitation, any governmental entity)
who is not a party to this Agreement (or any Affiliate of either party) or to
the Tax Sharing Agreement of any claim or of the commencement by any such
person of any Action (a "Third Party Claim") with respect to which an
Indemnifying Party may be obligated to provide indemnification pursuant to
Section 4.01, 4.02 or any

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other Section of this Agreement, such Indemnitee shall give such Indemnifying
Party written notice thereof promptly after becoming aware of such Third Party
Claim; provided that the failure of any Indemnitee to give notice as provided
in this Section 4.04(a) shall not relieve the related Indemnifying Party of its
obligations under this Article IV, except to the extent that such Indemnifying
Party is prejudiced by such failure to give notice. Such notice shall describe
the Third Party Claim in reasonable detail.

(b) An Indemnifying Party may elect to defend or to seek to settle or
compromise, at such Indemnifying Party's own expense and by such Indemnifying
Party's own counsel, any Third Party Claim. Within 30 days of the receipt of
notice from an Indemnitee in accordance with Section 4.04(a) (or sooner, if the
nature of such Third Party Claim so requires), the Indemnifying Party shall
notify the Indemnitee of its election whether the Indemnifying Party will
assume responsibility for defending such Third Party Claim, which election
shall specify any reservations or exceptions. After notice from an
Indemnifying Party to an Indemnitee of its election to assume the defense of a
Third Party Claim, such Indemnifying Party shall not be liable to such
Indemnitee under this Article IV for any legal or other expenses (except
expenses approved in advance by the Indemnifying Party) subsequently incurred
by such Indemnitee in connection with the defense thereof; provided that if the
defendants with respect to any such Claim include both the Indemnifying Party
and one or more Indemnitees and in any Indemnitee's reasonable judgment a
conflict of interest between one or more of such Indemnitees and such
Indemnifying Party exists in respect of such claim or if the Indemnifying Party
shall have assumed responsibility for such claim with any reservations or
exceptions, such Indemnitees shall have the right to employ separate counsel to
represent such Indemnitees and in that event the reasonable fees and expenses
of such separate counsel (but not more than one separate counsel reasonably
satisfactory to the Indemnifying Party) shall be paid by such Indemnifying
Party. If an Indemnifying Party elects not to assume responsibility for
defending a Third Party Claim, or fails to notify an Indemnitee of its election
as provided in this Section 4.04(b), such Indemnitee may defend or (subject to
the remainder of this Section 4.04(b)) seek to compromise or settle such Third
Party Claim. Notwithstanding the foregoing, neither an Indemnifying Party nor
an Indemnitee may settle or compromise any claim over the objection of the
other; provided, however, that consent to settlement or compromise shall not be
unreasonably withheld. Neither an Indemnifying Party nor an Indemnitee shall
consent to entry of any judgment or enter into any settlement of any Third
Party

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Claim which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such Indemnitee, in the case of a consent or
settlement by an Indemnifying Party, or to the Indemnifying Party, in the case
of a consent or settlement by the Indemnitee, of a written release from all
liability in respect to such Third Party Claim.

(c) If an Indemnifying Party chooses to defend or to seek to
compromise or settle any Third Party Claim, the related Indemnitee shall make
available to such Indemnifying Party any personnel or any books, records or
other documents within its control or which it otherwise has the ability to
make available that are necessary or appropriate for such defense, settlement
or compromise, and shall otherwise cooperate in the defense, settlement or
compromise of such Third Party Claims.

(d) Notwithstanding anything else in this Section 4.04 to the
contrary, if an Indemnifying Party notifies the related Indemnitee in writing
of such Indemnifying Party's desire to settle or compromise a Third Party Claim
on the basis set forth in such notice (provided that such settlement or
compromise includes as an unconditional term thereof the giving by the claimant
or plaintiff of a written release of the Indemnitee from all liability in
respect thereof) and the Indemnitee shall notify the Indemnifying Party in
writing that such Indemnitee declines to accept any such settlement or
compromise, such Indemnitee may continue to contest such Third Party Claim,
free of any participation by such Indemnifying Party, at such Indemnitee's sole
expense. In such event, the obligation of such Indemnifying Party to such
Indemnitee with respect to such Third Party Claim shall be equal to (i) the
costs and expenses of such Indemnitee prior to the date such Indemnifying Party
notifies such Indemnitee of the offer to settle or compromise (to the extent
such costs and expenses are otherwise indemnifiable hereunder) plus (ii) the
lesser of (A) the amount of any offer of settlement or compromise which such
Indemnitee declined to accept and (B) the actual out-of-pocket amount such
Indemnitee is obligated to pay subsequent to such date as a result of such
Indemnitee's continuing to pursue such Third Party Claim.

(e) Any claim on account of a Loss which does not result from a Third
Party Claim shall be asserted by written notice given by the Indemnitee to the
related Indemnifying Party. Such Indemnifying Party shall have a period of 30
days after the receipt of such notice within which to respond thereto. If such
Indemnifying Party does not respond within such 30 day period, such
Indemnifying Party shall be deemed

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to have refused to accept responsibility to make payment. If such Indemnifying
Party does not respond within such 30 day period or rejects such claim in whole
or in part, such Indemnitee shall be free to pursue such remedies as may be
available to such party under this Agreement or under applicable law.

(f) In addition to any adjustments required pursuant to Section 4.03,
if the amount of any Loss shall, at any time subsequent to the payment required
by this Agreement, be reduced by recovery, settlement or otherwise, the amount
of such reduction, less any expenses incurred in connection therewith, shall
promptly be repaid by the Indemnitee to the Indemnifying Party.

(g) In the event of payment by an Indemnifying Party to any Indemnitee
in connection with any Third Party Claim, such Indemnifying Party shall be
subrogated to and shall stand in the place of such Indemnitee as to any events
or circumstances in respect of which such Indemnitee may have any right or
claim relating to such Third Party Claim against any claimant or plaintiff
asserting such Third Party Claim or against any other person. Such Indemnitee
shall cooperate with such Indemnifying Party in a reasonable manner, and at the
cost and expense of such Indemnifying Party, in prosecuting any subrogated
right or claim.

Section 4.05 Remedies Cumulative. The remedies provided in this
Article IV shall be cumulative and shall not preclude assertion by any
Indemnitee of any other rights or the seeking of any and all other remedies
against any Indemnifying Party.

Section 4.06 Survival of Indemnities. The obligations of each of
Ryder and Aviall under this Article IV shall survive the sale or other transfer
by it of any assets or businesses or the assignment by it of any Liabilities,
with respect to any Loss of the other related to such assets, businesses or
Liabilities.

ARTICLE V

ACCESS TO INFORMATION; SERVICES

Section 5.01 Provision of Corporate Records. As soon as practicable
after the date of this Agreement, Ryder shall deliver to Aviall all books and
records of the businesses conducted or to be conducted by Aviall and the Aviall
Subsidiaries. Such books and records shall be the property

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of Aviall, but shall be retained in accordance with the provisions of Section
5.04.

Section 5.02 Access to Information. From and after the Distribution
Date, Ryder shall afford to Aviall and its authorized accountants, counsel and
other designated representatives (collectively, "Representatives") reasonable
access (including using reasonable efforts to give access to persons or firms
possessing information) and duplicating rights during normal business hours to
all records, books, contracts, instruments, computer data and other data and
information (collectively, "Information") within Ryder's possession relating to
Aviall or any Aviall Subsidiary, insofar as such access is reasonably required
by Aviall or any Aviall Subsidiary. Similarly, Aviall shall afford to Ryder
and its Representatives reasonable access (including using reasonable efforts
to give access to persons or firms possessing information) and duplicating
rights during normal business hours to Information within Aviall's possession
relating to Aviall and any Aviall Subsidiary or Ryder or any Ryder Subsidiary,
insofar as such access is reasonably required by Ryder or any Ryder Subsidiary.
Information may be requested under this Article V for, without limitation,
audit, accounting, claims, litigation and tax purposes, as well as for purposes
of fulfilling disclosure and reporting obligations and for performing this
Agreement and the transactions contemplated hereby.

Section 5.03 Production of Witnesses. After the Distribution Date,
each of Ryder and Aviall and its respective Subsidiaries shall use reasonable
efforts to make available to the other party and its Subsidiaries, upon written
request, its directors, officers, employees and agents as witnesses to the
extent that any such person may reasonably be required (giving consideration to
business demands of such Representatives) in connection with any legal,
administrative or other proceedings in which the requesting party may from time
to time be involved.

Section 5.04 Retention of Records. Except as otherwise required by
law or agreed to in writing, each of Ryder and Aviall shall retain, and shall
cause its Subsidiaries to retain following the Distribution Date, for a period
consistent with the document retention policies then in effect at Ryder, Aviall
and Aviall Subsidiaries, respectively, all significant Information relating to
the business of the other and the other's Subsidiaries. In addition, after the
expiration of the applicable document retention periods, such Information shall
not be destroyed or otherwise disposed of at any time, unless, prior to such
destruction or disposal, (a) the party proposing to destroy or otherwise
dispose of

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such Information shall provide no less than 30 days' prior written notice to
the other, specifying in reasonable detail the Information proposed to be
destroyed or disposed of and (b) if a recipient of such notice shall request in
writing prior to the scheduled date for such destruction or disposal that any
of the Information proposed to be destroyed or disposed of be delivered to such
requesting party, the party proposing the destruction or disposal shall
promptly arrange for the delivery of such of the Information as was requested
at the expense of the party requesting such Information.

Section 5.05 Confidentiality. Each of Ryder and the Ryder
Subsidiaries on the one hand, and Aviall and the Aviall Subsidiaries on the
other hand, shall hold, and shall cause its Representatives to hold, in strict
confidence, all Information concerning the other in its possession or furnished
by the other or the other's Representatives pursuant to either this Agreement
or the Tax Sharing Agreement (except to the extent that such Information has
been (a) in the public domain through no fault of such party or (b) later
lawfully acquired from other sources by such party), and each party shall not
release or disclose such Information to any other person, except its auditors,
attorneys, financial advisors, bankers and other consultants and advisors,
unless compelled to disclose by judicial or administrative process or, as
advised by its counsel, by other requirements of law.

Section 5.06 Provision of Services.

(a) Ryder shall make available to Aviall, during normal business hours
and in a manner that will not unreasonably interfere with Ryder's business, its
tax, internal audit, accounting, legal and similar staff and services upon the
terms and subject to the conditions set forth in the Services Agreement.

(b) Aviall shall make available to Ryder, during normal business hours
and in a manner that will not unreasonably interfere with Aviall's business,
its tax, internal audit, accounting, legal and similar staff and services
(collectively "Aviall Services") whenever and to the extent that they may be
reasonably required in connection with the preparation of tax returns, audits,
claims or litigation, and otherwise to assist in effecting an orderly
transition following the Distribution. Aviall shall be entitled to receive
from Ryder, upon the presentation of invoices therefor, reimbursement for all
fully allocated direct costs of providing the Aviall Services, but without any
profit to Aviall.

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ARTICLE VI

MISCELLANEOUS

Section 6.01 Complete Agreement; Construction. This Agreement, the
Employee Benefits Agreement, the Tax Sharing Agreement and the Services
Agreement, including any schedules and exhibits hereto or thereto, and other
agreements and documents referred to herein, shall constitute the entire
agreement between the parties with respect to the subject matter hereof and
shall supersede all previous negotiations, commitments and writings with
respect to such subject matter. Notwithstanding any other provisions in this
Agreement to the contrary, in the event and to the extent that there shall be a
conflict between the provisions of this Agreement and the provisions of the Tax
Sharing Agreement, the provisions of the Tax Sharing Agreement shall control.

Section 6.02 Survival of Agreements. Except as otherwise contemplated
by this Agreement, all covenants and agreements of the parties contained in
this Agreement shall survive the Distribution Date.

Section 6.03 Expenses. Except as otherwise set forth in this
Agreement, the Employee Benefits Agreement or the Tax Sharing Agreement, all
costs and expenses arising on or prior to the Distribution Date (whether or not
then payable) in connection with the Distribution (other than (i) costs
incurred in connection with any financing arrangements entered into by Aviall
or any of its Subsidiaries, (ii) listing fees of any national securities
exchange incurred with respect to listing the Aviall Common Stock, (iii) any
fees charged by the rating agencies for rating Aviall securities, (iv) the fees
and expenses of any outside consultant or counsel retained by Aviall, (v) costs
incurred in engraving and printing the stock certificates of Aviall, (vi)
one-half of the cost of printing and distributing the Form 10 and Information
Statement and (vii) costs (including attorneys' fees) of establishing any new
employee benefit or compensation plans of Aviall, which shall be paid by
Aviall) shall be paid by Ryder to the extent that appropriate documentation
concerning such costs and expenses shall be provided to Ryder.

Section 6.04 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to the principles of conflicts of laws thereof.

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Section 6.05 Consent to Jurisdiction. Ryder and Aviall consent to and
hereby submit to the exclusive jurisdiction of any state or federal court
located in the state of New York solely for the purpose of all legal
proceedings arising out of or relating to this Agreement or the transactions
contemplated hereby. The exclusive venue for adjudication of any dispute or
proceeding arising out of this Agreement or the transactions contemplated
hereby shall be the state or federal courts located in the State of New York
and each of the parties hereto irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any
claim that any such proceeding brought in such a court has been brought in an
inconvenient forum.

Section 6.06 Notices. All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be delivered by
hand, mailed by registered or certified mail (return receipt requested), or
sent by cable, telegram, telex or telecopy (confirmed by regular, first-class
mail), to the parties at the following addresses (or at such other addresses
for a party as shall be specified by like notice) and shall be deemed given on
the date on which such notice is received:

if to Ryder:

Ryder System, Inc.
3600 NW 82 Avenue
Miami, Florida 33166
Attention: General Counsel

if to Aviall:
Aviall, Inc.
9311 Reeves Street
Dallas, Texas 75235
Attention: General Counsel

Section 6.07 Amendments. This Agreement may not be modified or
amended except by an agreement in writing signed by the parties.

Section 6.08 Successors and Assigns. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
and their respective successors and permitted assigns.

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Section 6.09 Termination. This Agreement may be terminated and the
Distribution abandoned at any time prior to the Distribution Date by and in the
sole discretion of the Ryder Board without the approval of Aviall or Ryder's
shareholders. In the event of such termination, no party shall have any
liability of any kind to any other party on account of such termination except
that expenses incurred in connection with the transactions contemplated hereby
shall be paid as provided in Section 6.03.

Section 6.10 No Third Party Beneficiaries. Except for the provisions
of Article IV relating to Indemnitees, this Agreement is solely for the benefit
of the parties hereto and their respective Affiliates and should not be deemed
to confer upon third parties (including any employee of Ryder or Aviall or any
Ryder or Aviall Subsidiary) any remedy, claim, reimbursement, cause of action
or other right in excess of those existing without reference to this Agreement.

Section 6.11 Titles and Headings. Titles and headings to sections
herein are inserted for the convenience of reference only and are not intended
to be part of or to affect the meaning or interpretation of this Agreement.

Section 6.12 Legal Enforceability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction. Without
prejudice to any rights or remedies otherwise available to any party hereto,
each party hereto acknowledges that damages would be an inadequate remedy for
any breach of the provisions of this Agreement and agrees that the obligations
of the parties hereunder shall be specifically enforceable.

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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.

RYDER SYSTEM, INC.

By:
----------------------------

AVIALL, INC.

By:
----------------------------

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SCHEDULE 3.01

Aeronautical Improvements Corporation (Florida)

Ryder Airline, Inc. (Delaware)
APS Technical Specialties, Inc. (California)
Ryder Airline Services, Inc. (Delaware)
Ryder Aviation Leasing & Sales Corporation (Barbados)
Ryder Aviation Sales International, Inc. (Florida)
Aviation Sales Leasing Company, Inc. (Florida)

Ryder Airline Services Limited (Scotland)

Aviall (UK) Limited (England)

Inventory Locator Service, Inc. (Tennessee)

Ryder Aviall, Inc. (Florida)
Airplane Things, Inc. (Texas)
Aviall Far East, Inc. (Florida)
Ryder Aviall Aviation Pte. Ltd. (Singapore)
Aviall Foreign Sales Corporation (Barbados)
Airstocks Limited (Hong Kong)
Aviall AB (Sweden)
Aviall (Canada) Ltd. (Ontario)
Aviall De Mexico S.A. DE C.V. (Mexico)
Aviall of Texas GMBH (Germany)
Aviall S.A.R.L. (France)
Ryder Aviation AG (Switzerland)
Ryder Aviation Export AG (Switzerland)
Ryder Aviall Austr. Pty. Ltd. (Australia)
Mulay Pty. Ltd. (Australia)
Van Dusen Aircraft Supplies Ltd. (Australia)
Ryder Aviall New Zealand Limited (New Zealand)

SCHEDULE 4.01

Items with respect to which Ryder will indemnify the Aviall Indemnitees
in accordance with Section 4.01 of the Agreement:

(1) All Losses arising out of the businesses conducted (formerly or
currently) or to be conducted by Ryder (whether directly or through a
Subsidiary or Affiliate of Ryder) or any Ryder Subsidiary or any previously
owned division, Subsidiary or Affiliate of Ryder, whether such Losses relate to
events, occurrences or circumstances occurring or existing, or whether such
Losses are asserted, before or after the Distribution Date, excluding the
businesses conducted (formerly or currently) or to be conducted by Aviall
(whether directly or through a Subsidiary or Affiliate of Aviall), the Aviall
Subsidiaries and any previously owned division, Subsidiary or Affiliate of
Aviall, but including all Losses arising out of Ryder's discontinued aircraft
leasing operations.

(2) All Losses arising out of or based upon any untrue statement or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, with respect to the following sections of
the Information Statement or any preliminary or final Form 10 or any amendment
thereto: "Introduction"; "The Distribution"; "Arrangements Between Ryder and
Aviall Relating to the Distribution"; "Summary of Certain Information" (only to
the extent that such summary includes information also contained in the
foregoing sections); any letter to shareholders from an executive officer of
Ryder (other than one who is to become a Separated Employee).

SCHEDULE 4.02

Items with respect to which Aviall will indemnify the Ryder Indemnitees
in accordance with Section 4.02 of the Agreement:

(1) All Losses arising out of any guarantees or obligations to third
parties on the part of Ryder or any Ryder Subsidiary with respect to any
obligations or Liabilities of Aviall or any Aviall Subsidiary to such third
parties, including, without limitation, the Guaranty.

(2) All Losses arising out of the businesses conducted (formerly or
currently) or to be conducted by Aviall (whether directly or through a
Subsidiary or Affiliate of Aviall), the Aviall Subsidiaries and any previously
owned division, Subsidiary or Affiliate of Aviall, whether such Losses relate
to events, occurrences or circumstances occurring or existing, or whether such
Losses are asserted, before or after the Distribution Date.

(3) All Losses arising out of or based upon any untrue statement or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, with respect to all information contained in
the Information Statement or any preliminary or final Form 10 or any amendment
thereto; provided, however, that such indemnification shall not apply to any
Losses that arise out of or are based upon any statement or omission or alleged
statement or omission made in any of the sections of the Information Statement
or Form 10 that are listed in paragraph (2) of Schedule 4.01.