BLOUNT INC, DEF 14A, 1994-05-16

BLOUNT INC
DEF 14A, 1994-05-16
GENERAL BLDG CONTRACTORS - NONRESIDENTIAL BLDGS

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<PAGE> 1

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant /X/

Filed by a Party other than the Registrant / /

Check the appropriate box:

/ / Preliminary Proxy Statement

/X/ Definitive Proxy Statement

/ / Definitive Additional Materials

/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12

Blount, Inc.
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified in Charter)

Blount, Inc.
- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):

/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(j)(2).

/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).

/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

(2) Aggregate number of securities to which transaction applies:

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:

(4) Proposed maximum aggregate value of transaction:

Set forth the amount on which the filing fee is calculated and state how it
was determined.

/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

(2) Form, Schedule or Registration Statement No.:

(3) Filing Party:

(4) Date Filed:
<PAGE> 2

BLOUNT (LOGO)

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

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD JUNE 27, 1994
---------------------

TO THE STOCKHOLDERS OF BLOUNT, INC.:

The Annual Meeting of Stockholders of Blount, Inc. will be held at 10:00
A.M., C.D.T., on Monday, June 27, 1994 in the Wilson Auditorium of the
Montgomery Museum of Fine Arts, One Museum Drive, Montgomery, Alabama 36117, for
the following purposes:

1. To elect a Board of Directors to serve until the next Annual Meeting of
Stockholders or until their successors have been elected and qualified;

2. To consider and act upon a proposal to approve the 1994 Blount
Executive Stock Option Plan;

3. To consider and act upon a proposal to approve the Executive Management
Target Incentive Plan;

4. To consider and act upon a proposal to ratify the appointment of
Coopers & Lybrand as independent auditors for the Corporation for the
fiscal year ending February 28, 1995; and

5. To transact such other business as may properly come before the meeting
or any adjournment thereof.

The Board of Directors has fixed the close of business on Friday, April
29, 1994, as the record date for determining the stockholders entitled to notice
of and to vote at the Meeting or any adjournment thereof.

IF YOU OWN SHARES OF CLASS A COMMON STOCK AND CLASS B COMMON STOCK, YOU
MUST RETURN BOTH PROXY FORMS IN ORDER TO VOTE FOR ALL DIRECTORS.

ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING. TO ASSURE
YOUR REPRESENTATION AT THE MEETING, YOU ARE REQUESTED TO COMPLETE, DATE AND SIGN
THE ACCOMPANYING FORM OR FORMS OF PROXY AND RETURN THEM PROMPTLY IN THE ENCLOSED
ENVELOPE.

By Order of the Board of Directors,

D. JOSEPH McINNES
Senior Vice President -- Administration
and Secretary

4520 Executive Park Drive
Montgomery, Alabama 36116-1602
May 18, 1994
<PAGE> 3

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<PAGE> 4

BLOUNT, INC.

4520 EXECUTIVE PARK DRIVE

MONTGOMERY, ALABAMA 36116-1602

(205) 244-4000

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

PROXY STATEMENT
FOR THE
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD
JUNE 27, 1994

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

This Proxy Statement is furnished in connection with the solicitation on
behalf of the Board of Directors (the "Board") of Blount, Inc., a Delaware
corporation (the "Corporation"), of your proxy or proxies for use at the Annual
Meeting of Stockholders to be held on June 27, 1994, or at any adjournment
thereof (the "Meeting"). It is anticipated that this Proxy Statement and the
accompanying form or forms of proxy will be mailed to stockholders on or about
May 18, 1994.

Shares represented by each properly signed proxy on the accompanying form
or forms received by the Corporation in time to permit its use at the Meeting or
any adjournment thereof will be voted at the Meeting, but such proxy may be
revoked at any time prior to the actual voting thereof by giving notice in
writing to the Secretary of the Corporation or by voting a subsequently dated
proxy. If a proxy is signed but no specification is made on the proxy, the
shares represented by the proxy will be voted as recommended by the Board. If a
specification is made, the shares will be voted in accordance with the
specification. The presence of a stockholder at the Meeting does not revoke his
or her proxy; however, a stockholder may revoke his or her proxy and vote in
person if he or she so requests.

VOTING SECURITIES

RECORD DATE, CLASSES OF STOCK ENTITLED TO VOTE, AND VOTE REQUIRED

The Board has fixed the close of business on Friday, April 29, 1994, as the
record date for determining stockholders entitled to notice of and to vote at
the Meeting. Holders of shares of Class A Common Stock and Class B Common Stock
are entitled to vote at the Meeting. As of such date, the Corporation had issued
and outstanding 8,297,015 shares of Class A Common Stock and 4,178,175 shares of
Class B Common Stock. There are no cumulative voting or preemptive rights.

The holders of Class A Common Stock will be entitled to elect 25% (rounded
up to the nearest whole number) of the directors and will be entitled to 1/10 of
1 vote per share with respect to other matters. The holders of Class B Common
Stock will be entitled to elect the remaining directors and will be entitled to
1 vote per share with respect to other matters.

Directors are elected by the affirmative vote of a majority of the shares
of the appropriate class of common stock, voting as a single class, cast in the
election. The affirmative vote of a majority of the voting power of the shares
of both classes of common stock, voting together, cast in the election is
required to approve any other proposal presented at the Meeting.

1
<PAGE> 5

PRINCIPAL STOCKHOLDERS

The following table sets forth as of April 29, 1994, to the best knowledge
of the Corporation, information as to (a) beneficial ownership of more than 5%
of the Class A Common Stock and Class B Common Stock of the Corporation by
certain persons (other than director nominees); and (b) beneficial ownership of
Class A Common Stock and Class B Common Stock of the Corporation by (i) each
director nominee, (ii) each executive officer named in the Summary Compensation
Table other than director nominees, and (iii) all director nominees and
executive officers of the Corporation as a group. Except as otherwise indicated,
all beneficial ownership stated in the table represents sole voting and
investment power.

<TABLE>
<CAPTION>
PERCENT
SHARES PERCENT OF
NAME AND ADDRESS OF BENEFICIALLY OF TOTAL
BENEFICIAL OWNERS TITLE OF CLASS OWNED CLASS VOTES(1)
----------------------------------- --------------------- -------------- ------ ------
<S> <C> <C> <C> <C> <C> <C>
(a) Holders of more than 5% of Class A
Common Stock and Class B Common
Stock (other than director nominees
and executive officers named in the
Summary Compensation Table)
-----------------------------------
HBC, Incorporated Class A Common Stock 2,075,048 (2) 25.01% 4.14%
4520 Executive Park Drive Class B Common Stock 2,803,232 (2) 67.09% 55.98%
Montgomery, Alabama 36116
United States Trust Company Class A Common Stock 1,082,938 (3) 13.05% 2.16%
of New York Class B Common Stock None
114 West 47th Street
New York, New York 10036
(b)(i) Nominees -- Class A Common Stock
-----------------------------------
Herbert J. Dickson Class A Common Stock 3,932 * *
Class B Common Stock None
James W. Hargrove Class A Common Stock 4,000 * *
Class B Common Stock None
Mary D. Nelson Class A Common Stock 2,000 * *
Class B Common Stock None
Nominees -- Class B Common Stock
-----------------------------------
Winton M. Blount Class A Common Stock 2,095,193 (4) 25.25% 4.18%
Class B Common Stock 3,410,578 (4) 81.63% 68.10%
W. Houston Blount Class A Common Stock 2,909 * *
Class B Common Stock 1,332 * *
C. Todd Conover Class A Common Stock 1,000 * *
Class B Common Stock None
H. Corbin Day Class A Common Stock 8,304 * *
Class B Common Stock None
Alfred M. Gleason Class A Common Stock 600 * *
Class B Common Stock None
John M. Panettiere Class A Common Stock 24,803 (5) * *
Class B Common Stock None
Arthur P. Ronan Class A Common Stock None
Class B Common Stock None
Joab L. Thomas Class A Common Stock 2,086 * *
Class B Common Stock None
</TABLE>

2
<PAGE> 6

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

* Less than .50% of class or total votes.
(1) Percent of total votes on all matters other than the election of directors.
(2) HBC, Incorporated is a corporation of which Winton M. Blount is the
controlling stockholder, owning 53.99% of its voting stock. For further
information, see Certain Transactions and Other Matters on page 21.
(3) United States Trust Company of New York serves as the Master Trustee for the
Corporation's 401(k) Retirement Savings Plan. The shares listed are held
for the benefit of the participants in that plan. Under the terms of the
Plan, as amended, and the Trust, the Trustee is to vote the allocated
shares held by the Plan in accordance with the instructions received from
Plan participants and to dispose of the allocated shares in connection with
tender offers in accordance with directions received from Plan
participants. If no voting instructions or invalid voting instructions are
received with respect to allocated shares, the Trustee is to vote such
shares in the same manner and in the same proportions as the allocated
shares with respect to which the Trustee received valid voting instructions
are voted. Also, with respect to allocated shares, if no directions or
invalid directions are received in connection with tendering shares, the
Trustee is to treat such allocated shares as if Plan participants
instructed the Trustee not to dispose of such shares. With respect to
unallocated shares, the Trustee is to vote such shares, or dispose of such
shares in connection with tender offers, in the same manner and in the same
proportion as the allocated shares with respect to which the Trustee
received valid voting instructions or directions are voted or disposed.
United States Trust Company of New York, as Trustee, expressly denies
beneficial ownership in the shares listed.
(4) - Excludes 320,094 shares of Class A Common Stock (3.86% of class, .64% of
total votes) and 517,449 shares of Class B Common Stock (12.38% of class,
10.33% of total votes) owned beneficially by children, step-children,
their spouses, and grandchildren of Winton M. Blount and Carolyn S.
Blount. Winton M. Blount and his wife, Carolyn S. Blount, do not have or
share voting or dispositive power with respect to, and disclaim any
beneficial ownership in, such shares.
- Includes 906 shares of Class A Common Stock (less than .50% of class and
total votes) and 906 shares of Class B Common Stock (less than .50% of
class and total votes) owned by Winton M. Blount's wife.
- Includes 1,966 shares of Class A Common Stock (less than .50% of class
and total votes) and 1,966 shares of Class B Common Stock (less than .50%
of class and total votes) held by Winton M. Blount or Trustee of a trust
for the benefit of his sister. Winton M. Blount disclaims any beneficial
ownership in such shares.
- Includes the 2,075,048 shares of Class A Common Stock (25.01% of class,
4.14% of total votes) and 2,803,232 shares of Class B Common Stock (67.09%
of class, 55.98% of total votes) shown in the table as owned by HBC,
Incorporated. (See Note 2 above.)
(5) Includes 12,213 shares of Class A Common Stock (less than .50% of class and
total votes) which are subject to a right to acquire beneficial ownership
within 60 days under the 1992 Blount Incentive Stock Option Plan.
(6) Includes 4,000 shares of Class A Common Stock (less than .50% of class and
total votes) which are subject to a right to acquire beneficial ownership
within 60 days under the 1992 Blount Incentive Stock Option Plan.
(7) Includes 8,000 shares of Class A Common Stock (less than .50% of class and
total votes) which are subject to a right to acquire beneficial ownership
within 60 days under the 1992 Blount Incentive Stock Option Plan.
(8) Includes 24,213 shares of Class A Common Stock (less than .50% of class and
total votes) which are subject to a right to acquire beneficial ownership
within 60 days under the 1992 Blount Incentive Stock Option Plan.

3
<PAGE> 7

ELECTION OF DIRECTORS

PROPOSAL 1

DIRECTORS

The By-laws of the Corporation, which may be amended by the Board,
presently provide that the number of directors which shall constitute the whole
Board shall be not less than 3 nor more than 14, with the exact number to be
determined from time to time by resolution of the Board. The Board set the exact
number at 11 effective June 27, 1994, with 3 members to be elected by the
holders of Class A Common Stock and 8 members to be elected by the holders of
Class B Common Stock. Class A Common Stock proxies may not be voted for more
than 3 persons, and the Class B Common Stock proxies may not be voted for more
than 8 persons.

The Board intends to nominate and, unless contrary instructions are
specified, to vote, as appropriate, all proxies received by the Board FOR the
election of the persons named below as directors of the Corporation.

Each director to be elected shall hold office until the next Annual Meeting
of Stockholders of the Corporation or until his or her successor is elected and
qualified or until his or her earlier resignation or removal. Should any nominee
fail to accept election, it is expected that the Board will cast all proxies, as
appropriate, received by it in favor of the election of such other person for
the office of director as the Board may recommend. The Board has no reason to
believe that any of the persons named below will fail to accept election as a
director.

BIOGRAPHICAL INFORMATION

The following biographical information is furnished with respect to each
nominee for election as director at the Meeting:

<TABLE>
<S> <C>
NOMINEES -- CLASS A COMMON STOCK
- - ---------------------- HERBERT J. DICKSON, Age 68.
- - ---------------------- Director since July 1966(1); Chairman of the Finance Committee and member of the
- - ---------------------- Compensation and Management Development Committee.
- - ---------------------- Financial consultant since March 1993; formerly Chairman of the Board and Chief
- - ---------------------- Executive Officer of Fortune Financial Services, Inc., Atlanta, Georgia (a finance
- - ---------------------- company) throughout the 5 years preceding March 1993.
- - ---------------------- Mr. Dickson is also a director of American Business Products, Inc., Atlanta,
- - ---------------------- Georgia; and Martin Industries, Inc., Florence, Alabama.
- - ----------------------
- - ----------------------
- - ---------------------- JAMES W. HARGROVE, Age 71.
- - ---------------------- Director since June 1975, except from February 1976 through March 1977 during which
- - ---------------------- period he served as U.S. Ambassador to Australia; Chairman of the Audit Committee
- - ---------------------- and member of the Finance Committee.
- - ---------------------- Financial counselor throughout the past 5 years and Chairman of the Board of Entrix,
- - ---------------------- Inc., Houston, Texas (environmental consultants) since December 1988.
- - ----------------------
- - ----------------------
- - ----------------------
- - ----------------------
- - ---------------------- MARY D. NELSON, Age 61.
- - ---------------------- Director since June 1986; member of the Audit Committee and the Finance Committee.
- - ---------------------- President of Nelson & Co., Cincinnati, Ohio (consulting actuaries) throughout the
- - ---------------------- past 5 years.
- - ----------------------
- - ----------------------
- - ----------------------
- - ----------------------
- - ----------------------
- - ----------------------
</TABLE>

4
<PAGE> 8

<TABLE>
<S> <C>
NOMINEES -- CLASS B COMMON STOCK
- - ---------------------- WINTON M. BLOUNT, Age 73.
- - ---------------------- Director since September 1949(1), except from January 1969 through October 1971
- - ---------------------- during which period he served as Postmaster General of the United States; Chairman
- - ---------------------- of the Executive Committee.
- - ---------------------- Chairman of the Board since June 1993; Chairman of the Board and Chief Executive
- - ---------------------- Officer of the Corporation throughout the 5 years preceding June 1993 except from
- - ---------------------- December 1990 to October 1991 during which period he served as Chairman of the
- - ---------------------- Board.
- - ---------------------- Mr. Blount is the brother of W. Houston Blount.
- - ---------------------- Mr. Blount is also a director of the Alabama Shakespeare Festival, Montgomery,
Alabama; Montgomery Museum of Fine Arts, Montgomery, Alabama; National Actors
Theatre, New York, New York; Chairman of the Advisory Committee of the National
Postal Museum, Washington, DC; Life Trustee of Rhodes College, Memphis, Tennessee;
Trustee of the National Symphony Orchestra, Washington, DC; and Governor of the
Royal Shakespeare Company, London, England.
- - ---------------------- W. HOUSTON BLOUNT, Age 72.
- - ---------------------- Director since September 1949(1); Chairman of the Acquisition Committee, member of
- - ---------------------- the Executive Committee and the Compensation and Management Development Committee.
- - ---------------------- Chairman of the Board Emeritus since May 1992; Chairman of the Board from May 1986
- - ---------------------- of Vulcan Materials Company, Birmingham, Alabama (crushed stone and chemicals).
- - ---------------------- Mr. Blount is the brother of Winton M. Blount.
- - ---------------------- Mr. Blount is also a director of VF Corporation, Reading, Pennsylvania.
- - ----------------------
- - ----------------------
- - ----------------------
- - ---------------------- C. TODD CONOVER, Age 54.
- - ---------------------- Director since September 1992; member of the Audit Committee and the Finance
- - ---------------------- Committee.
- - ---------------------- General Manager of the Finance Industry Group of Tandem Computers Incorporated,
- - ---------------------- Cupertino, California since January 1994; formerly President and Chief Executive
- - ---------------------- Officer of The Vantage Company, Denver, Colorado (management services) from July
- - ---------------------- 1992; President and Chief Executive Officer of Central Bancorporation, Denver,
- - ---------------------- Colorado (bank holding company) from July 1991; National Director with KPMG Peat
- - ---------------------- Marwick, San Francisco, California and New York, New York (bank consulting) from
- - ---------------------- September 1988. He served as Comptroller of the Currency of the United States from
December 1981 through May 1985.
Mr. Conover is also a Director of PacifiCorp, Portland, Oregon.
- - ---------------------- H. CORBIN DAY, Age 56.
- - ---------------------- Director since June 1992; member of the Audit Committee, the Finance Committee, the
- - ---------------------- Compensation and Management Development Committee and the Acquisition Committee.
- - ---------------------- Limited partner of Goldman, Sachs & Co., New York, New York (investment bankers)
- - ---------------------- throughout the past 5 years, and Chairman from May 1988 of Jemison Investment Co.,
- - ---------------------- Inc., Birmingham, Alabama (investment bankers).
- - ---------------------- Mr. Day is also a director of Jemison Investment Co., Inc. and its affiliated
- - ---------------------- companies, Birmingham, Alabama; Altec Industries, Inc., Birmingham, Alabama;
- - ---------------------- American Heritage Life Insurance Company, Jacksonville, Florida; and trustee of
- - ---------------------- Birmingham Museum of Art, Birmingham, Alabama.
</TABLE>

5
<PAGE> 9

<TABLE>
<S> <C>
- - ---------------------- ALFRED M. GLEASON, Age 64.
- - ---------------------- Director since February 1985; Chairman of the Compensation and Management
- - ---------------------- Development Committee and member of the Executive Committee.
- - ---------------------- Vice Chairman since February 1994, President and Chief Executive Officer from
- - ---------------------- January 1989, President from January 1985 of PacifiCorp, Portland, Oregon
- - ---------------------- (diversified utility).
- - ---------------------- Mr. Gleason is also a director of PacifiCorp, Portland, Oregon; Fred Meyer, Inc.,
- - ---------------------- Portland, Oregon; Comdial Corporation, Charlottesville, Virginia; PacifiCorp
- - ---------------------- Financial Services, Inc., Portland, Oregon; Tektronix, Inc., Beaverton, Oregon;
- - ---------------------- Legacy Health System, Portland, Oregon; trustee of Willamette University, Salem,
Oregon; and Commissioner of the Port of Portland, Portland, Oregon.
- - ---------------------- JOHN M. PANETTIERE, Age 56.
- - ---------------------- Director since May 1992.
- - ---------------------- President and Chief Executive Officer since June 1993, President and Chief Operating
- - ---------------------- Officer from May 1992 of the Corporation; formerly Chairman, President and Chief
- - ---------------------- Executive Officer from January 1990, President and Chief Executive Officer from
- - ---------------------- January 1988, Senior Executive Vice President and Chief Operating Officer from
- - ---------------------- August 1986 of Grove Worldwide Company, Shady Grove, Pennsylvania (manufacturer of
- - ---------------------- mobile hydraulic cranes and aerial work platforms).
- - ---------------------- Mr. Panettiere is also a director and Past Chairman of the Construction Industry
- - ---------------------- Manufacturers Association, Milwaukee, Wisconsin.
- - ---------------------- ARTHUR P. RONAN, Age 64.
- - ---------------------- Director since June 1993; member of the Audit Committee and the Acquisition
- - ---------------------- Committee.
- - ---------------------- Retired since February 1992; formerly Corporate Vice President from 1982 and
- - ---------------------- President from June 1985 of the Automotive Operations of Rockwell International
- - ---------------------- Corporation, Troy, Michigan (manufacturer of automotive components).
- - ---------------------- Mr. Ronan was Chairman and President of Western Highway Institute, Bruno, California
- - ---------------------- from 1991 to 1993; Vice Chairman of Highway Users Federation, Washington, D.C.
- - ---------------------- from 1990 to 1992; Trustee of General Motors Institute, Flint, Michigan from 1984
- - ---------------------- to 1992; member of the Board of Advisors of Oakland University, Rochester,
Michigan from 1984 to 1992; and Trustee of Marygrove College, Detroit, Michigan
from 1975 to 1979.
- - ---------------------- JOAB L. THOMAS, Age 61.
- - ---------------------- Director since June 1981; member of the Finance Committee.
- - ---------------------- President, Pennsylvania State University, College Park, Pennsylvania since September
- - ---------------------- 1990; formerly Professor from September 1988 and President from July 1981 of the
- - ---------------------- University of Alabama, Tuscaloosa, Alabama.
- - ---------------------- Dr. Thomas is also a director of Lukens, Inc., Coatesville, Pennsylvania; and Mellon
- - ---------------------- Bank, Pittsburgh, Pennsylvania.
- - ----------------------
- - ----------------------
- - ----------------------
</TABLE>

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

(1) Includes the period for which the person served as a director of Blount
Brothers Corporation. The Corporation was organized in February 1971, and
on March 1, 1971, the stockholders of Blount Brothers Corporation exchanged
their stock in Blount Brothers Corporation for stock in the Corporation.
Blount Brothers Corporation was merged into the Corporation on February 29,
1988.

6
<PAGE> 10

THE BOARD AND ITS COMMITTEES

The property, affairs and business of the Corporation are managed under the
direction of the Board. The Board has standing Executive, Audit, Finance,
Acquisition and Compensation and Management Development Committees whose
principal functions are described below. The Corporation does not have a
Nominating Committee. During the fiscal year ended February 28, 1994 ("Fiscal
1994"), the Board held 5 regular meetings and took action 3 times by written
consent in lieu of a meeting. Average attendance by directors at Board and
Committee meetings was 93%. All directors attended 75% or more of the meetings
of the Board and the Committees on which they serve.

Executive Committee -- The Executive Committee consists of 4 members, 2 of
whom are non-employee directors. The Chairman of the Board of the Corporation is
Chairman of the Committee. The Committee may exercise all of the authority and
powers of the Board, to the extent permitted by law, during the intervals
between Board meetings. The Committee held no regular meetings during Fiscal
1994. The present members of the Committee are Winton M. Blount, W. Houston
Blount, Alfred M. Gleason and John M. Panettiere.

Audit Committee -- The Audit Committee consists of 6 members, all of whom
are non-employee directors. The functions of the Committee include (i)
recommending annually to the Board the appointment of the Corporation's
independent auditors, (ii) reviewing the professional services, proposed fees
and independence of such auditors, (iii) reviewing the annual audit plans of
such auditors and the internal audit staff, (iv) monitoring the activities of
the independent auditors and internal audit staff, and (v) reporting on such
activities to the Board. The Committee held 2 regular meetings and had 1
telephone conference meeting during Fiscal 1994. The present members of the
Committee are C. Todd Conover, H. Corbin Day, James W. Hargrove, Mary D. Nelson,
Oscar J. Reak and Arthur P. Ronan.

Finance Committee -- The Finance Committee (name changed from Investment
Committee in November 1993) consists of 6 members, all of whom are non-employee
directors. The functions of the Committee include (i) approving the
Corporation's funding policy for its retirement plans, (ii) approving actuarial
assumptions for the retirement plans, (iii) approving the selection and
termination of investment managers, trustees, independent auditors and actuaries
for the retirement plans, (iv) approving the investment policy asset allocation
guidelines, objectives, constraints, and restrictions, as appropriate, issued to
investment managers and trustees, (v) approving operating procedures and
safeguards as required to prohibit transactions not authorized under the
Employee Retirement Income Security Act, (vi) approving the consolidation,
merger, or transfer of retirement plan assets or liabilities to or from one plan
to another, (vii) approving reports with regard to retirement plans prepared by
the trustees, the independent auditors, investment managers or consultants, and
the actuaries, and (viii) reporting on such activities to the Board. The
Committee held 3 regular meetings during Fiscal 1994. The present members of the
Committee are C. Todd Conover, H. Corbin Day, Herbert J. Dickson, James W.
Hargrove, Mary D. Nelson and Joab L. Thomas.

Compensation and Management Development Committee -- The Compensation and
Management Development Committee consists of 4 members, all of whom are
non-employee directors. The functions of the Committee include (i) approving
compensation philosophy and guidelines for the Corporation's executive and
managerial employees, (ii) establishing a total compensation range for the
Chairman of the Board and the President and Chief Executive Officer ("CEO") and
appraising the performance of said officers on a timely basis, (iii) approving
salaries and changes in salaries of officers of the Corporation and presidents
of its divisions and subsidiaries or other executives as the Committee may deem
appropriate, (iv) approving the participants, annual financial or other targets,
and amounts to be paid under the Corporation's Target Incentive Plans, (v)
approving all payments made under the Corporation's Long-term Performance Share
Plan, (vi) reviewing and recommending to the Board any new excutive incentive or
stock option plans or additions to or revisions of such existing plans and
approving any awards or options granted under such plan(s), (vii) reviewing from
time to time the Corporation's management resources and executive personnel
planning, development and selection processes, and (viii) reporting on such
activities to the Board. The Committee held 4 regular meetings and had 2
telephone conference meetings and took action 2 times by written consent in lieu
of a meeting during Fiscal 1994. The present members of the Committee are W.
Houston Blount, H. Corbin Day, Herbert J. Dickson and Alfred M. Gleason.

Acquisition Committee -- The Acquisition Committee consists of 3 members,
all of whom are non-employee directors. The functions of the Committee are to
review and approve any acquisition proposed by management and report on such
activities to the Board. The Committee was established in January 1994 and it
did not hold any regular meeting in Fiscal 1994. The present members of the
Committee are W. Houston Blount, H. Corbin Day, and Arthur P. Ronan.

COMPENSATION OF DIRECTORS

Non-employee directors received a retainer fee of $4,750 ($4,000 prior to
July 1993) per quarter plus a fee of $1,000 ($800 prior to July 1993) for each
Board Meeting attended in person or by telephone conference, an additional
$1,000 ($800 prior to July 1993) for each Board Committee Meeting attended in
person or by telephone conference, and an additional $800 for each consent
action in lieu of a meeting that they executed prior to July 1993. No fee for
execution of consent actions is paid after July 1993.

7
<PAGE> 11

Persons serving as Chairmen of Committees of the Board, who were not employees
of the Corporation, received an additional retainer fee of $750 ($500 prior to
July 1993) per quarter for their services. The directors were reimbursed for
travel and other expenses and were provided travel insurance when traveling on
Corporation business, liability insurance coverage and participation in a
charitable contributions matching gift program. Participation in the
Corporation's group medical and dental plans was available to the non-employee
directors on the same basis as offered to all employees of the Corporation. In
addition, each nonemployee director was provided $50,000 of life insurance under
the Corporation's group life insurance plan. Directors who are employees of the
Corporation do not receive any additional compensation for their services as
directors.

In January 1983, the Board approved a Directors' Fee Deferral Plan under
which directors may defer receipt of directors' fees until their retirement or
other termination of status as a director. Deferred amounts bear interest,
adjusted quarterly, based on the prime rate set by a New York bank. Such
accumulated fees, together with the income accrued thereon, are payable in cash
to the director or his or her estate in accordance with the option selected by
the director at the time he or she elected to participate in this plan. The
Director's Fee Deferral Plan is unfunded and amounts due the participants
covered thereby are general obligations of the Corporation. One director has
chosen to defer his director's fees.

In May 1991, the Board approved and in April 1994 amended the Advisory
Directors' Recognition Plan. Each member of the Board who has served as a
director for at least 5 consecutive years and who has not been an employee
vested in any employee benefits sponsored by the Corporation during his or her
service on the Board and (a) who is serving at the attainment of age 72, or (b)
who becomes permanently and totally disabled at any time prior to age 72, shall
become an advisory director. No advisory director and no other director, except
the co-founders of the Corporation, shall be eligible to stand for reelection to
the Board who, after July 1, 1991, is or reaches age 72. Under this plan, a
director who is or becomes eligible for advisory director status after July 1,
1991, shall, at the end of his or her current term, be paid a quarterly benefit
for life equal to the quarterly cash retainer, exclusive of committee chairman
fees, then being paid to the director. An advisory director who attains that
status due to disability shall be paid a quarterly disability benefit equal to
the quarterly cash retainer then being paid to directors for the shorter of (a)
such advisory director's life, or (b) the number of the advisory director's full
years of service as a director. A director who has been an employee vested in
employee benefits sponsored by the Corporation is eligible to become an advisory
director, but shall not be entitled to the retainer paid to advisory directors.
When their views on a matter are sought, advisory directors are expected to
consult with management or directors of the Corporation. The status of advisory
director may be terminated upon request by the advisory director or by the Board
if it determines that an advisory director becomes a director, officer, employee
or consultant of or to another company that competes with the Corporation or any
of its divisions or subsidiaries. The Advisory Directors' Recognition Plan does
not apply to Winton M. Blount, a co-founder of the Corporation and it does not
apply to W. Houston Blount, a co-founder of the Corporation until he ceases to
be a member of the Board of Directors regardless of his age at the time of such
cessation. The Advisory Directors' Recognition Plan is unfunded and amounts due
the participants covered thereby are general obligations of the Corporation.
There is presently 1 participant under this plan.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The following members of the Board served as members of the Compensation
and Management Development Committee during the last completed fiscal year or
for the portion of the year stated:

W. Houston Blount, Chairman of the Board Emeritus of Vulcan Materials
Company.

H. Corbin Day, Limited Partner of Goldman, Sachs & Co., and Chairman
of Jemison Investments Co., Inc. began service on April 1, 1993.

Herbert J. Dickson, Financial Consultant and formerly Chairman of the
Board of Fortune Financial Services.

Alfred M. Gleason, Vice Chairman of the Board of PacifiCorp.

There were no relationships with respect to Compensation Committee
interlocks and insider participation in compensation decisions during the last
completed fiscal year.

8
<PAGE> 12

COMPENSATION AND MANAGEMENT DEVELOPMENT COMMITTEE
REPORT ON EXECUTIVE COMPENSATION

OVERALL OBJECTIVES OF THE EXECUTIVE COMPENSATION PROGRAM

The Corporation's executive compensation program is designed to help the
Corporation attract, motivate and retain the executive resources that the
Corporation needs in order to maximize its return to shareholders.

Toward that end, the Corporation's executive compensation program attempts
to provide:

- levels of compensation that are competitive with those provided in the
various markets in which the Corporation competes for its executive
resources;

- incentive compensation that varies in a manner consistent with the
financial performance of the Corporation; and

- incentive compensation that effectively rewards corporate and individual
performance.

In designing and administering its executive compensation program, the
Corporation attempts to maintain an appropriate balance among these various
objectives, each of which is discussed in greater detail below.

PROVIDING COMPETITIVE LEVELS OF COMPENSATION

The Corporation attempts to provide its executives with a total
compensation package that, at expected levels of performance, is competitive
with total compensation provided to executives who hold comparable positions or
have similar qualifications in other organizations of similar size and scope
with which the Corporation competes.

The Corporation projects an executive's competitive level of compensation
based on information drawn from a variety of sources, including proxy
statements, special surveys, and compensation consultants. This information is
used in creating the basic structure of the Corporation's program. The market
data used in establishing the Corporation's executive compensation levels
reflect a blending of general industry and manufacturing industry companies
comparable to the Corporation's size, including many of the industry peer
companies covered by the total shareholder return graph. However, the Committee
has not defined the Corporation's compensation comparative group to be identical
to the companies included in the graph for a variety of reasons, including the
need to adjust for differences in company size and scope.

It should be noted that the value of an executive's compensation package
will vary significantly based on performance. So while the expected value of an
executive's compensation package may be competitive, its actual value can exceed
or fall below competitive levels depending on performance.

ENSURING THAT INCENTIVE COMPENSATION VARIES WITH FINANCIAL PERFORMANCE

The Corporation's incentive plans are designed to ensure that the incentive
compensation varies in a manner consistent with the financial performance of the
Corporation and its various business units. The specific corporate performance
factors for Fiscal 1994 are discussed in other sections of this report.

All operating segments, with the exception of the discontinued construction
segment, were profitable and performed above budgeted expectations for Fiscal
1994.

REWARDING INDIVIDUAL PERFORMANCE

The Corporation believes that effectively rewarding individual performance
will ultimately serve to enhance the financial performance of the Corporation
and its various business units. While the Corporation's incentive plans provide
compensation that varies with financial performance, they also provide for
individual awards that are based on qualitative assessments of Corporation,
business unit and individual performance.

DESCRIPTION OF THE EXECUTIVE COMPENSATION PROGRAM

This section describes each of the principal elements of the Corporation's
executive compensation program.

BASE SALARY PROGRAM

The objective of the Corporation's base salary program for senior executive
management positions is to provide base salaries that are approximately between
the 65th and 80th percentile of the competitive market norms for companies in
the Corporation's business lines and similar in size to the Corporation. The
Committee believes it is crucial to provide competitive salaries in order to
attract and retain managers who are highly talented. The specific competitive
markets considered depend on the nature and level of the positions in question
and the markets from which qualified individuals are recruited.

9
<PAGE> 13

Base salary levels are also dependent on the performance of each individual
employee. Thus, employees with higher levels of sustained performance will be
paid correspondingly higher salaries.

Annual salary reviews are based on three factors: general levels of market
salary increases, individual performance, and the Corporation's overall
financial results. All base salary increases are based on a philosophy of
pay-for-performance and perceptions of an individual's long-term value to the
Corporation.

THE MANAGEMENT INCENTIVE PLAN

The objectives of the Annual Target Incentive Plan are to motivate and
reward the accomplishment of annual corporate objectives; reinforce a strong
performance orientation with differentiation and variability in individual
awards based on contributions to business results; and provide a fully
competitive compensation package which will attract, reward and retain
individuals of the highest quality. As a pay-for-performance plan, cash bonus
awards are paid upon the achievement of specific performance objectives
established for the fiscal year.

Targeted bonus award levels are determined for eligible positions each year
using data obtained from independent consultants and surveys. The target bonus
levels reflect competitive market norms for companies similar in size to the
Corporation and the Corporation's philosophy of providing competitive total
annual compensation opportunities.

A bonus program is established each year based on the Corporation's
budgeted performance against measures approved by the Committee. In Fiscal 1994,
the key performance measures considered were pre-tax income, return on capital
employed, net income and for all positions other than the Chairman of the Board
and the President and Chief Executive Officer, individual key base objectives
were established. The weighting of these measures differ among each of the
Corporation's operating units and range from a 60% to 70% weighting factor for
pre-tax income, 15% to 25% for return on capital employed and 15% for attainment
of individual performance objectives.

For the corporate staff and senior corporate officers, 60% of bonus
attainment is based on the Corporation's net income targets and 40% of the bonus
is determined by attainment of individual key base objectives. The bonus
attainment for the Chairman of the Board and for the President and Chief
Executive Officer is based 100% on the Corporation's net income targets.

Target bonuses for Incentive Plan participants range from 5% to 65% of the
participants' base pay. Participants can earn from 80% (minimum threshold) to
200% (maximum bonus) of a target bonus. The actual bonus is determined by the
extent to which performance objectives have been accomplished.

LONG-TERM INCENTIVES

The Corporation's approach to long-term incentives for employees is focused
on the Corporation's stock option plans. The Corporation uses stock options to
align the interests of employees and shareholders by providing value to the
employee when the stock price increases. Options are granted at 100% of the
market value of the stock on the date of grant.

All options granted have terms of 10 years and are generally exercisable
within 5 years of the date of the grant. The exercise price is payable in cash.
No option holder has any rights as a shareholder for any shares subject to an
option until the exercise price has been paid and the shares have been issued to
the employee.

The Corporation's stock option grant levels are established by considering
competitive market data on grant levels and the level of shares reserved for
such plans. Individual option grants are based on the responsibility level of
each participant in the Corporation, individual performance, and the amounts of
previous grants.

The Executive Compensation Program is reviewed annually by the Compensation
and Management Development Committee to provide an appropriate mix of base
salary, annual bonus, and long-term rewards within the philosophy of providing
competitive total direct compensation opportunities.

The Chairman of the Board, as the majority shareholder of the Corporation,
does not participate in the Stock Option Plan. Stock options granted to the
named executives in Fiscal 1994 are shown in the Option Grant Table on page 14.

10
<PAGE> 14

FISCAL 1994 CHAIRMAN OF THE BOARD AND THE PRESIDENT AND CHIEF EXECUTIVE OFFICER
PAY

As described above, the Corporation determines its pay for all executives,
including the Chairman of the Board and the President and Chief Executive
Officer, considering both a pay-for-performance philosophy and market rates of
compensation for the job. Specific actions taken by the Committee regarding the
Chairman of the Board and the President and Chief Executive Officer's
compensation are summarized below:

Base Salary -- The Chairman of the Board and Chief Executive Officer, Mr.
Winton Blount, received a merit increase of 7.6% in March 1993 based on
competitive data and performance. The President and Chief Operating
Officer, Mr. John Panettiere, received an 8% merit increase in March 1993
based on competitive data and performance. In June 1993, Mr. Panettiere was
promoted to President and Chief Executive Officer and a 15.75% promotion
increase was granted in September 1993 based on competitive data.

Annual Bonus -- The Corporation's Fiscal 1994 performance significantly
exceeded targeted net income objectives. All continuing operating segments
were profitable and performed well above budgeted targets for return on
capital employed and pre-tax income more than offsetting results in the now
discontinued construction segment. As a result, an annual incentive funding
pool was created for Fiscal 1994 performance and awards were made to
certain key executives named in the compensation table at levels exceeding
target bonus objectives.

The bonus for Fiscal 1994 generated by the Management Incentive Plan
formula for Mr. Winton Blount, Chairman of the Board, and for Mr. John
Panettiere, President and Chief Executive Officer, was based on the
Corporation's attainment of the net income objective established in March 1993.
The Corporation's performance significantly exceeded that objective thus bonuses
equal to 150% of the 65% target for Mr. Winton Blount and 150% of the 60% target
for Mr. John Panettiere were earned for Fiscal 1994.

An Executive Management Target Incentive Plan is being implemented for the
fiscal year beginning March 1, 1994. The plan, which covers the Chairman of the
Board and the President and Chief Executive Officer, is a performance based plan
that provides for the payment of bonuses if the Corporation achieves specified
net income levels. Assuming the shareholders approve the plan at the 1994 Annual
Meeting, the Compensation and Management Development Committee anticipates that
the plan will meet the requirements so that payments under the plan will be
deductible under Section 162(m) of the Internal Revenue Code.

Alfred M. Gleason, Chairman
W. Houston Blount
H. Corbin Day
Herbert J. Dickson

EXECUTIVE OFFICERS

The executive officers of the Corporation, in addition to those who are
also Director nominees, as of April 29, 1994 are:

<TABLE>
<CAPTION>
YEAR FIRST
ELECTED TO FAMILY
NAME OFFICE SUCH OFFICE AGE RELATIONSHIP
- - ------------------- ------------------------------------------------------ ----------- --- ------------
<S> <C> <C> <C> <C>
K. O. Dixon President of Dixon Industries, Inc. 1973 55 None
Thomas J. Fruechtel President of the Sporting Equipment Division of the 1993 43 None
Corporation
Bernell Jiles President of Gear Products, Inc. 1984 60 None
Harold E. Layman Senior Vice President and Chief Financial Officer of 1993 47 None
the Corporation
Frank H. McFadden Executive Vice President and General Counsel of the 1991and 68 None
Corporation 1993
D. Joseph McInnes Senior Vice President -- Administration and Secretary 1991,and 51 None
of the Corporation and President and of The Blount 1994
Foundation, Inc. 1982
James S. Osterman President of the Oregon Cutting Systems Division of 1987 56 None
the Corporation
Donald B. Zorn President of the Forestry and Industrial Equipment 1994 57 None
Division of the Corporation
</TABLE>

11
<PAGE> 15

Each of these executive officers serves at the pleasure of the Board. There
were no arrangements or understandings with any other person pursuant to which
any officer was elected. The executive officers of the Corporation may also be
directors or officers of divisions or subsidiaries of the Corporation.

K. O. Dixon was elected President of Dixon Industries, Inc. (manufacturer
of riding lawn mowers) in 1973. Dixon Industries, Inc. was acquired by the
Corporation in March 1990.

Thomas J. Fruechtel was appointed President of the Sporting Equipment
Division of the Corporation in March 1993. Prior to that date, Mr. Fruechtel
served as Executive Vice President from October 1992 and Director of Marketing
from August 1987 of the Sporting Equipment Division.

Bernell Jiles was elected President of Gear Products, Inc. (designer and
manufacturer of rotation bearings and mechanical power transmission components)
in January 1984. Gear Products, Inc. was acquired by the Corporation in March
1991.

Harold E. Layman was elected Senior Vice President and Chief Financial
Officer of the Corporation in January 1993. Prior to that date, he served as
Senior Vice President Finance and Administration and was a member of the
Executive Committee of VME Group, N.V., The Netherlands from September 1988
(manufacturer of automotive components and industrial equipment); and Senior
Vice President Finance and Administration of VME Americas Inc., Cleveland, Ohio
from August 1986.

Frank H. McFadden was elected Executive Vice President and General Counsel
of the Corporation in June 1993. Prior to that date, he served as Executive Vice
President -- Legal Affairs of the Corporation from October 1991, Executive Vice
President -- Government Affairs of the Corporation from April 1991 and Senior
Vice President and General Counsel of the Corporation from January 1982. In
addition, he served as Chairman of the Board and Chief Executive Officer of
Blount Energy Resource Corp. (former energy resource subsidiary of the
Corporation) from January 1983 until March 1987 and Chairman of the Board until
June 1988. He also served as Chief Financial Officer and Treasurer of the
Corporation from May 1985 until November 1985 and Chief Financial Officer until
March 1986.

D. Joseph McInnes was elected Senior Vice President -- Administration and
Secretary of the Corporation in May 1994. Prior to that date, he served as
Senior Vice President -- Administration of the Corporation from October 1991,
and Vice President -- Human Resources of the Corporation from March 1983. In
addition, he was elected President of The Blount Foundation, Inc. (a charitable
foundation funded by the Corporation) in April 1982.

James S. Osterman was appointed President of the Oregon Cutting Systems
Division of the Corporation in January 1987.

Donald B. Zorn was appointed President of the Forestry and Industrial
Equipment Division of the Corporation in January 1994. Prior to that date, he
served as President and Chief Operating Officer of Grove Cranes, a division of
Grove Worldwide Company, Shady Grove, Pennsylaania (manufacturer of mobile
hydraulic cranes and aerial work platforms) from March 1988.

12
<PAGE> 16

EXECUTIVE COMPENSATION

The following table summarizes, for the fiscal years ended the last day of
February 1992, 1993 and 1994, all plan and non-plan compensation awarded to,
earned by, or paid to (i) the CEO and (ii) the four most highly compensated
executive officers other than the CEO of the Corporation (the "Named Executive
Officers") at the end of Fiscal 1994 in all capacities in which they served:

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
---------------------------------------
AWARDS PAYOUTS
ANNUAL COMPENSATION ------------------------- -----------
--------------------------------------------- SECURITIES LONG-TERM
NAME AND OTHER RESTRICTED UNDERLYING INCENTIVE ALL
PRINCIPAL SALARY BONUS ANNUAL STOCK OPTIONS PLAN OTHER
POSITION YEAR ($) ($) COMPENSATION($) AWARD(S)($) (#) PAYOUTS($) COMPENSATION($)
- - ---------------------- ----- -------- -------- --------------- ------------ ---------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Winton M. Blount 1994 635,000 619,125 30,569(1) 0 0 0 33,261(5)
Chairman and CEO to 1993 590,000 355,000 13,538 0 0 0 25,701
June 1993, Chairman 1992 590,000 0 -- 0 0 0 --
thereafter
John M. Panettiere 1994 461,379 450,000 26,807(2) 0 100,000 0 72,900(6)
President & COO to 1993 332,051 225,000 34,273 0 100,000 0 193,774
June 1993, President 1992 -- -- -- -- -- -- --
and CEO thereafter
James S. Osterman 1994 200,000 180,000 0 0 50,000 0 12,445(7)
President of the 1993 178,969 158,334 0 0 0 0 11,341
Oregon Cutting 1992 162,600 73,170 -- 0 25,000 0 --
Systems Division
Harold E. Layman 1994 220,000 148,500 6,319(3) 0 50,000 0 17,557(8)
Senior Vice 1993 36,667 16,506 0 0 20,000 0 31,673
President and Chief 1992 -- -- -- -- -- -- --
Financial Officer
D. Joseph McInnes 1994 219,450 148,129 5,785(4) 0 50,000 0 13,799(9)
Senior Vice 1993 201,027 100,000 2,266 0 0 0 713
President -- 1992 157,055 0 -- 0 20,000 0 --
Administration
</TABLE>

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

(1) Tax gross-up on club dues, personal use of the Corporation's property, and
premiums on life insurance policies.
(2) Tax gross-up on club dues, personal use of the Corporation's property,
premiums on life insurance policy, and relocation expenses.
(3) Tax gross-up on club dues and personal use of the Corporation's property.
(4) Tax gross-up on club dues, personal use of the Corporation's property and
premiums on life insurance policies.
(5) Amount is comprised of $4,497 matching contribution to employee's 401(k)
account and $28,764 attributable to the personal portion of the premiums on
life insurance policies under the Executive Benefit Life Insurance and
Supplemental Retirement Plan.
(6) Amount is comprised of $29,824 matching contribution to employee's 401(k)
and excess 401(k) accounts and $43,076 premiums on a life insurance policy
under the Executive Life Insurance Plan.
(7) Amount is comprised of $5,913 matching contribution to employee's 401(k) and
excess 401(k) accounts and $6,532 accrued pursuant to the Omark Salary
Continuation Plan.
(8) Amount is comprised of $4,127 relocation expenses and $13,430 premiums on a
life insurance policy under the Executive Life Insurance Plan.
(9) Amount is comprised of $12,896 matching contribution to employee's 401(k)
and excess 401(k) accounts and $903 attributable to the personal portion of
the premiums on life insurance policies under the Executive Benefit Life
Insurance and Supplemental Retirement Plan.

13
<PAGE> 17

OPTION GRANTS

The following table summarizes pertinent information concerning individual
grants of stock options, including the potential realizable dollar value of
grants of options made during Fiscal 1994 to each Named Executive Officer,
assuming that the market value of the underlying security appreciates in value,
from the date of grant to the end of the option term, at the rates indicated in
the following table:

OPTION GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
-------------------------------------------------- VALUE AT
NUMBER OF % OF TOTAL ASSUMED ANNUAL RATES OF
SECURITIES OPTIONS STOCK PRICE APPRECIATION
UNDERLYING GRANTED TO EXERCISE EXPIRATION FOR OPTION TERM(1)
OPTIONS EMPLOYEES IN PRICE DATE -------------------------
NAME GRANTED(#) FISCAL YEAR ($/SHARE) (MMDDYY) 5% ($) 10% ($)
---------------------- ----------- ------------ --------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Winton M. Blount 0 0 0 -- 0 0
John M. Panettiere 100,000 25.42% 28.50 01-23-04 1,792,000 4,542,000
James S. Osterman 50,000 12.71% 28.50 01-23-04 896,000 2,271,000
Harold E. Layman 50,000 12.71% 28.50 01-23-04 896,000 2,271,000
D. Joseph McInnes 50,000 12.71% 28.50 01-23-04 896,000 2,271,000
</TABLE>

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

(1) The amounts under these columns are the result of calculations at 5% and 10%
rates which were established by rules adopted by the Securities and
Exchange Commission and therefore are not intended to forecast possible
future appreciation, if any, in the price of the Corporation's Class A
Common Stock. The Corporation did not use an alternative formula for grant
date valuation since management is not aware of any forumla that will
determine with reasonable accuracy the present value of options granted
based on future unknown or volatile factors.

OPTION EXERCISES AND YEAR-END OPTION VALUES

The following table summarizes pertinent information concerning the
exercise of stock options during Fiscal 1994 by each of the Named Executive
Officers and the fiscal year-end value of unexercised options:

AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT OPTIONS AT
ACQUIRED ON FISCAL YEAR END (#) FISCAL YEAR END ($)
EXERCISE VALUE ----------------------------- -----------------------------
NAME (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------------------- ----------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Winton M. Blount 0 0 0 0 0 0
John M. Panettiere 12,213 71,751 0 187,787 0 2,041,381
James S. Osterman 9,000 151,750 0 65,000 0 402,500
Harold E. Layman 0 0 4,000 66,000 67,750 331,750
D. Joseph McInnes 0 0 8,000 62,000 178,000 335,750
</TABLE>

14
<PAGE> 18

PENSION PLANS

Assuming continuance of the Blount Retirement Plan in its present form,
estimated annual benefits payable to eligible employees (including executive
officers) in specific classifications following retirement at age 65 (normal
retirement age), after continuous years of credited service, are shown below:

PENSION PLAN TABLE

<TABLE>
<CAPTION>
ESTIMATED ANNUAL BENEFITS FOR
FIVE-YEAR AVERAGE SPECIFIED YEARS OF CREDITED SERVICE(1), (2)
EARNINGS AT ----------------------------------------------------------------------------------------
RETIREMENT(3) 10 15 20 25 30 35 40 OR MORE
<S> <C> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------------------------------------
$ 100,000 $ 20,000 $ 30,000 $ 40,000 $ 50,000 $ 52,500 $ 55,000 $ 57,500
150,000 30,000 45,000 60,000 75,000 78,750 82,500 86,250
200,000 40,000 60,000 80,000 100,000 105,000 110,000 115,000
250,000 50,000 75,000 100,000 125,000 131,250 137,500 143,750
300,000 60,000 90,000 120,000 150,000 157,500 165,000 172,500
350,000 70,000 105,000 140,000 175,000 183,750 192,500 201,250
400,000 80,000 120,000 160,000 200,000 210,000 220,000 230,000
450,000 90,000 135,000 180,000 225,000 236,250 247,500 258,750
500,000 100,000 150,000 200,000 250,000 262,500 275,000 287,500
550,000 110,000 165,000 220,000 275,000 288,750 302,500 316,250
600,000 120,000 180,000 240,000 300,000 315,000 330,000 345,000
650,000 130,000 195,000 260,000 325,000 341,250 357,500 373,750
700,000 140,000 210,000 280,000 350,000 367,500 385,000 402,500
</TABLE>

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

(1) The amounts set out above are based on the benefits under a straight life
annuity to a participant retiring at age 65 on March 1, 1994. The amounts
shown are to be reduced for offsetting amounts to be paid as social
security benefits and benefits payable under Master Annuity Contracts
(purchased upon termination of prior Retirement Plans).
(2) Under Section 415(b) of the Internal Revenue Code, as amended, the maximum
benefit payable under the Master Annuity Contracts (purchased upon
termination of prior Retirement Plans) and the Blount Retirement Plan to an
employee retiring at age 65 in 1994 is $118,800 ($115,641 for 1993), an
amount which may change each year in accordance with a determination made
by the Commissioner of the Internal Revenue Service. In addition, Section
401(a)(17) of the Internal Revenue Code, as amended, limits the amount of
an employee's compensation which may be taken into account under the Blount
Retirement Plan to $150,000 for 1994 ($235,840 for 1993), an amount which
also may change each year in accordance with a similar determination. These
limitations have been disregarded for the purposes of this table since the
amount of the benefit payable in excess of the limitation is covered by the
Blount, Inc. and Subsidiaries Supplemental Retirement Benefit Plan (the
"Excess Benefit Plan").
(3) Earnings covered by the Blount Retirement Plan are based on the
participant's base salary or wages.

The years of benefit service used to determine benefits under the Blount
Retirement Plan and the Master Annuity Contracts (purchased upon termination of
prior Retirement Plans) as of February 28, 1994, for the persons named in the
Summary Compensation Table are: Mr. Blount -- 48 years; Mr. Panettiere -- 2
years; Mr. Osterman -- 24 years; Mr. Layman -- 1 year; and Mr. McInnes -- 20
years.

EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND
CHANGE-IN-CONTROL ARRANGEMENTS

EXECUTIVE BENEFIT LIFE INSURANCE AND SUPPLEMENTAL RETIREMENT PLAN

On September 22, 1980, the Board adopted, effective August 1, 1980, an
Executive Benefit Life Insurance and Supplemental Retirement Plan (the "Keyman
Insurance Plan") for key executive officers of the Corporation and its divisions
and subsidiaries. Eligibility is determined by the Compensation and Management
Development Committee of the Board. Each participating executive officer has the
opportunity to obtain life insurance that will pay to the named beneficiary in
the event of the executive officer's death while employed by the Corporation or
one of its divisions or subsidiaries as a fulltime permanent employee, an amount
equal to 2 1/2 times the executive officer's annual compensation (base salary as
of August 1 of each year plus the amount of the most recent bonus, if any, paid
under the Corporation's Annual Target Incentive Plan) at the time of the
executive officer's death (the "Death Benefit"). The excess of the face amount
of the policy over the Death Benefit is paid to the Corporation. The Corporation
has ownership rights in the policy, except that the executive officer has the
right to change the beneficiary designation for the amount of the Death Benefit.
All dividends declared on the policy shall be applied at the option of the
Corporation to

15
<PAGE> 19

purchase additional paid-up insurance on the life of the executive officer or to
reduce the premiums on the policy. The Corporation pays all premiums due on the
policies.

If the executive officer retires directly from permanent full-time
employment with the Corporation or one of its divisions or subsidiaries, under
certain circumstances and subject to the election by the executive officer, the
Corporation, after withdrawing the cash value, will assign its rights in the
policy to the executive officer. In lieu of the Corporation's assignment of its
rights in the policy, the executive officer may elect to receive an optional
supplemental retirement benefit payable by the Corporation instead of all or a
portion of any interest the executive officer or his beneficiary or
beneficiaries may otherwise be entitled to under the policy, and the Death
Benefit will terminate. If the executive officer retires prior to age 65, he or
she may elect a supplemental retirement benefit commencing upon such retirement
date, but the benefit will be reduced based on a formula.

Should the executive officer upon retirement at age 65 elect to receive a
supplemental retirement benefit under the Keyman Insurance Plan and based on the
amount of life insurance in force at the end of Fiscal 1994, the persons named
in the Summary Compensation Table would receive the following annual payments
from the Corporation for 15 years in addition to the benefits payable under the
Master Annuity Contract, the Excess Benefit Plan and any Supplemental Executive
Retirement Plan: Mr. Blount -- $280,000; and Mr. McInnes -- $89,460. Messrs.
Layman, Osterman and Panettiere do not participate in the Keyman Insurance Plan.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS

The Corporation has a Supplemental Executive Retirement Plan for Winton M.
Blount effective January 1, 1989, that provides him with (i) a normal retirement
benefit from the Master Annuity Contract (purchased upon termination of the
prior Retirement Plan) and the Blount Retirement Plan, including future
amendments or restatements adopted and effective during the employment of Mr.
Blount, if such plans did not contain the limitation on compensation imposed by
Section 401(a)(17) and the limitation on benefits imposed by Section 415(b) of
the Internal Revenue Code, as amended, less any retirement benefit payable under
the Master Annuity Contract, the Blount Retirement Plan and the Excess Benefit
Plan, and (ii) a pre-retirement death benefit payable to Mr. Blount's designated
beneficiary under the Master Annuity Contract and the Blount Retirement Plan if
such plans did not contain the limitation on compensation imposed by Section
401(a)(17) and the limitation on benefits imposed by Section 415(b) of the
Internal Revenue Code, as amended, less any pre-retirement death benefit that
Mr. Blount's designated beneficiary receives under the Master Annuity Contract,
the Blount Retirement Plan and the Excess Benefit Plan. This Plan is
administered by the Board or, at its discretion, the Compensation and Management
Development Committee of the Board. This Plan may be amended from time to time
in any respect with the consent of the other party, but it cannot be terminated
without the consent of the Board or its designated committee and Mr. Blount. No
benefits are projected to be payable to Mr. Blount under this Plan.

The Corporation has a Supplemental Executive Retirement Plan for John M.
Panettiere effective May 1, 1992, that provides him with a retirement benefit
equal to the benefit guaranteed to a vested employee calculated under the
provisions of the Blount Retirement Plan in effect on January 1, 1992 (excluding
the limitation on compensation imposed by Section 401(a)(17) of the Internal
Revenue Code, as amended) including any future amendments or restatements
adopted and effective during the period of employment of Mr. Panettiere, on the
earlier of Mr. Panettiere's normal retirement date or termination date based on
the schedule of years of benefit service granted to him under this Plan on that
date less any retirement benefits payable under the Blount Retirement Plan, the
Excess Benefit Plan and the retirement income actually paid to Mr. Panettiere
under any pension plan maintained by a former employer of Mr. Panettiere. This
Plan is administered by the Board or, at its discretion, the Compensation and
Management Development Committee of the Board. This Plan may be amended from
time to time in any respect with the consent of the other party, but it cannot
be terminated without the consent of the Board or its designated committee and
Mr. Panettiere. At the discretion of the Board and after timely notice to Mr.
Panettiere, rights to receive any benefits under this Plan may be forfeited,
suspended, reduced or terminated by the Board if it determines in good faith
that good cause as defined in this Plan has been shown. The projected annual
benefit payable to Mr. Panettiere under this Plan, in addition to the benefits
payable under the Blount Retirement Plan, the Excess Benefit Plan and the
retirement income payable under any pension plan maintained by a former employer
of Mr. Panettiere, is $164,067.

OMARK SUPPLEMENTAL RETIREMENT PLAN

The Corporation sponsors a Supplemental Retirement Plan for the key
management employees of its Oregon Cutting Systems Division, Sporting Equipment
Division, and Forestry and Industrial Equipment Division (the "Omark
Supplemental Retirement Plan"), which was originally adopted by a predecessor
corporation, effective July 1, 1979. The Omark Supplemental Retirement Plan
provides a supplemental retirement benefit to participants equal to the excess,
if any, of (i) 50% of the participant's highest 5-year average base salary
during the last 10 years of employment before age 65, over (ii) the aggregate
amount available to the participant under the other benefit plans of the
divisions and one-half the primary social security benefit. The Omark
Supplemental Retirement Plan provides for retirement at an earlier age at
reduced benefits. The Omark Supplemental

16
<PAGE> 20

Retirement Plan may be revised or terminated by the Board. Mr. Osterman named in
the Summary Compensation Table participates in the Omark Supplemental Retirement
Plan. No benefits are projected to be payable under this Plan.

OMARK RETIREMENT PROTECTION PLAN

The Corporation sponsors a Retirement Protection Plan (the "Omark
Protection Plan") for the employees of its Oregon Cutting Systems Division,
Sporting Equipment Division, and Forestry and Industrial Equipment Division,
which was originally adopted by a predecessor corporation, effective November 1,
1983. Participation in the Omark Protection Plan is automatic if the amount of
an individual's benefit under the Omark Retirement Plan, which was funded by the
Corporation prior to its termination on July 27, 1985, is reduced as a result of
any deferral of compensation pursuant to the Omark Deferred Plan, which was
terminated effective December 31, 1986. Benefits under the Omark Protection Plan
are limited to the amount of any reduction of benefits under the Master Annuity
Contracts (purchased upon termination of the Omark Retirement Plan) or the
Pre-1992 Omark Retirement Plan as a result of any deferral of compensation
pursuant to the Omark Deferred Plan prior to its termination. If the benefits
that are actually due under the Master Annuity Contracts or the Blount
Retirement Plan are not reduced, then no benefits are due under the Omark
Protection Plan. The Board may terminate or amend the Omark Protection Plan on
the first day of any month by giving notice to the participants. Such
termination shall not affect the rights of participants under the Omark
Protection Plan as of such date of termination. The Omark Protection Plan is
unfunded and amounts due the participants covered thereby are general
obligations of the Corporation. Mr. Osterman named in the Summary Compensation
Table participates in the Omark Protection Plan. No benefits are projected to be
payable under this Plan.

OMARK SALARY CONTINUATION PLAN

The Corporation sponsors a Salary Continuation Plan for the employees of
its Oregon Cutting Systems Division, Sporting Equipment Division, and Forestry
and Industrial Equipment Division, who participated in the former Management
Award Plan of the divisions, which was originally adopted by a predecessor
corporation, effective January 1, 1985. The Salary Continuation Plan provides
the beneficiaries of the participants with a continuation of 2 years of annual
salary when death occurs. The Board may at any time terminate or amend the
Salary Continuation Plan. Participation in the Salary Continuation Plan was
frozen effective February 28, 1990. The Salary Continuation Plan is unfunded and
amounts due the beneficiaries of the participants covered thereby are general
obligations of the Corporation. Mr. Osterman named in the Summary Compensation
Table participates in the Salary Continuation Plan.

SUPPLEMENTAL RETIREMENT AND DISABILITY PLAN

The Corporation has a Supplemental Retirement and Disability Plan (the
"Retirement and Disability Plan") for the employees of the Corporation's
corporate office effective as of January 1, 1992 (adopted by the Board on
November 25, 1991). Each person who was an eligible employee of the corporate
office on December 31, 1991 and whose annual earnings were at least $90,000,
became a participant in the Retirement and Disability Plan on January 1, 1992 or
will become a participant on the first day thereafter on which he or she becomes
an eligible employee of the corporate office. The Retirement and Disability Plan
provides that, at the time a participant ceases to be an eligible employee, if
his or her retirement benefit under the Blount Retirement Plan is less than the
retirement benefit to which such participant would have been entitled at the
time he or she ceased to be an eligible employee if the Pre-1992 Blount
Retirement Plan had continued in effect without amendment, then such participant
shall be entitled to a supplemental retirement benefit under the Retirement and
Disability Plan which has an actuarial value equal to the excess, if any, of (i)
the actuarial value of the retirement benefit to which the participant would
have been entitled had the Pre-1992 Blount Retirement Plan continued in effect
over (ii) the actuarial value of his or her retirement benefit under the Blount
Retirement Plan, as amended and in effect at the time he or she ceases to be an
eligible employee. If such participant dies under circumstances entitling his or
her spouse to a benefit under the Blount Retirement Plan, as in effect at the
date of his or her death, such spouse shall be entitled to receive a benefit
having the actuarial value equal to the excess, if any, of (i) the actuarial
value of the benefit to which such spouse would have been entitled had the
Pre-1992 Blount Retirement Plan continued in effect over (ii) the actuarial
value of the benefit to which such spouse is entitled under the Blount
Retirement Plan, as in effect at the date of the participant's death. Payment of
any supplemental retirement benefit hereunder shall be made in the same form as
is payment of the corresponding benefit under the Blount Retirement Plan.

The Retirement and Disability Plan also provides that a participant who
ceases active work as a result of his or her inability to perform the duties of
his or her occupation because of disease or accidental bodily injury while an
eligible employee shall be entitled to receive a monthly disability benefit on
the 1st day of the 7th month following the month during which the participant
ceased to be an active eligible employee and terminating on the earlier of the
1st day of the calendar month in which the participant dies or the 1st day of
the 29th calendar month following the calendar month in which the participant
ceases to be an active eligible employee. The amount of each such monthly
payment during this period shall be equal to (i) 40% of the sum of the
participant's earnings less 50% of the participant's monthly social security
disability benefit, less (ii) the monthly benefit payable to the participant
under the long-term disability component of the Blount, Inc. Welfare Benefit
Plan. If a participant becomes

17
<PAGE> 21

disabled while an active eligible employee, he or she shall be entitled to
receive a long-term disability supplement commencing on the 1st day of the 30th
month following the month in which the participant ceases to be an active
eligible employee and terminating on the 1st day of the calendar month in which
the participant dies. No such supplement shall be payable during any month
ending prior to the participant's normal retirement date during which the
participant does not receive a social security disability benefit. The payment
is based on a formula set forth in this plan. The Retirement and Disability Plan
may be amended, suspended, or terminated in whole or in part at any time by
action of the Board without affecting prior rights accrued under this Plan.
Messrs. Blount, Layman, McInnes and Panettiere named in the Summary Compensation
Table participate in the Retirement and Disability Plan. No benefits are
projected to be payable under this Plan.

EMPLOYMENT CONTRACTS AND CHANGE-IN-CONTROL ARRANGEMENTS

The Corporation has an Employment Agreement with John M. Panettiere,
President and Chief Executive Officer, effective May 1, 1992. Pursuant to the
terms of the Employment Agreement, Mr. Panettiere is entitled to receive an
initial annual base salary of $400,000; participate in the Corporation's Annual
Target Incentive Plan with a guaranteed bonus of not less than $150,000 for
Fiscal 1993 and Fiscal 1994; and be provided an option to purchase 100,000
shares of the Corporation's Class A Common Stock. He is entitled to participate
in the Corporation's Executive Life Insurance Program and all other health and
welfare benefits generally available to executive officers of the Corporation.
Upon retirement at age 65, he is entitled to receive a retirement benefit of 50%
of his final average earnings less any benefits payable under the Blount
Retirement Plan, the Excess Benefit Plan, and the retirement income payable
under any pension plan maintained by a former employer.

The term of the Employment Agreement is for 5 years and will be extended 1
day for each day Mr. Panettiere is employed until he attains age 60. If Mr.
Panettiere's employment is terminated by the Corporation for any reason except
for Cause, as defined in the Employment Agreement, the Corporation will pay his
base salary and benefits for 36 months offset by any salary and benefits earned
in subsequent employment during the 36-month payment period. In the event of a
Change of Control (as defined in the Employment Agreement) or change in
ownership of the Corporation or upon the death of Winton M. Blount, Chairman of
the Board, a severance payment may be exercised at Mr. Panettiere's option
within 24 months of the date of the event giving rise to such severance payment
and be equal to 3 times Mr. Panettiere's average base salary received for the
immediately preceding 5 years payable in a lump sum within 30 days of the
severance event or in such manner as the Corporation and Mr. Panettiere may
agree. Mr. Panettiere is prohibited from entering into or engaging in the
design, manufacture, or marketing of any products similar to those produced or
offered by the Corporation for a period of 5 years after the date of termination
of his employment under the Employment Agreement and he is prohibited from
disclosing any confidential or proprietary information of the Corporation
following his termination of employment without the prior written consent of the
Chairman of the Board of the Corporation.

The Corporation has an Employment Agreement with Harold E. Layman, Senior
Vice President and Chief Financial Officer, effective January 1, 1994. Pursuant
to the terms of the Employment Agreement, Mr. Layman is entitled to the
compensation in effect on the effective date of the Employment Agreement and as
may be adjusted from time to time by the President and Chief Executive Officer
and approved by the Compensation and Management Development Committee of the
Board. Mr. Layman is entitled to the benefits in effect on the effective date of
the Employment Agreement generally provided by the Corporation to its similarly
situated Executives and as may be adjusted or eliminated at management's
discretion.

The term of the Employment Agreement shall be for a period beginning on the
effective date and ending 2 years prior to Mr. Layman's 65th birthday. The
Employment Agreement may be terminated by Mr. Layman or the Corporation upon 30
days written notice. If Mr. Layman's employment is terminated by the Corporation
for reasons other than normal retirement, death, total disability, Cause (as
defined in the Employment Agreement) or voluntary termination, the Corporation
will make payments to him equal to 2 times his base salary during the preceeding
12 months. The payments will be made in 24 equal monthly payments following the
termination date and will be forfeited if Mr. Layman accepts employment with a
competitor or its affiliated entities during the severance payment period. After
age 55, any severance payments due Mr. Layman under the Employment Agreement
will be offset by any consulting fees paid by the Corporation after his
termination and any retirement income payable under the Blount Retirement Plan
and the Excess Benefit Plan. In the event of a Change of Control (as defined in
the Employment Agreement), Mr. Layman may, at his option, decide to leave the
Corporation and be paid severance pay as though he were terminated by the
Corporation.

Mr. Layman is prohibited, during the period beginning on the effective date
of the Employment Agreement and ending 2 years following his termination of
employment, from hiring or soliciting any employees of the Corporation or any of
its affiliates to work for any person or company then in competition with the
Corporation or any of its affiliates, or, directly or indirectly, soliciting or
attempting in any manner to persuade or influence any present, future or
prospective customer or client of the Corporation or any of its affilitates to
divert his or its purchases of products or services from the Corporation or any
of its affilitates to any person or company then in competition with the
Corporation or any of its affiliates. Mr. Layman is prohibited from disclosing
or furnishing information about the Corporation's business to any third party
except as specifically authorized by

18
<PAGE> 22

management of the Corporation or as may reasonably be necessary to carry out his
duties or as demanded by a subpoena duly served.

The Corporation has an Employment Agreement with D. Joseph McInnes, Senior
Vice President -- Administration and Secretary, effective March 31, 1992.
Pursuant to the terms of the Employment Agreement, Mr. McInnes is entitled to
the compensation in effect on the effective date of the Employment Agreement and
as may be adjusted from time to time by the President and Chief Executive
Officer and approved by the Compensation and Management Development Committee of
the Board. Mr. McInnes is entitled to the benefits in effect on the effective
date of the Employment Agreement generally provided by the Corporation to its
similarly situated Executives and as may be adjusted or eliminated at
management's discretion.

The term of the Employment Agreement is for 5 years and shall be extended 1
day for each day Mr. McInnes is employed until he attains age 60. The Employment
Agreement may be terminated by Mr. McInnes or the Corporation upon 30 days
written notice. If Mr. McInnes' employment is terminated by the Corporation for
reasons other than normal retirement, death, total disability, Cause (as defined
in the Employment Agreement), or voluntary termination, the Corporation will
make payments to him equal to 3 times his base salary during the preceeding 12
months. The payments will be made in 36 equal monthly payments following the
termination date and may be terminated if Mr. McInnes accepts employment with a
competitor or its affiliated entities during the severance payment period. All
benefits and perquisites in effect on the effective date of the Employment
Agreement and as improved or increased from time to time shall continue during
any severance period.

In the event of a Change of Control (as defined in the Employment
Agreement), a severance payment may be exercised at the option of Mr. McInnes
and shall be an amount equal to the lesser of the following less one dollar: (i)
3 times the average base salary Mr. McInnes received for the immediate preceding
5 calendar years or (ii) the maximum amount which may be paid to Mr. McInnes
without constituting an Excess Parachute Payment as defined in Section 280G of
the Internal Revenue Code, as amended. The severance payment shall be paid in a
single lump sum to Mr. McInnes not later than 30 days after the termination
occurs or it may be paid in any other manner in which the Corporation and Mr.
McInnes agree.

Mr. McInnes is prohibited, during the period beginning on the effective
date of the Employment Agreement and ending 3 years following his termination of
employment, from hiring or soliciting any employees of the Corporation or any of
its affiliates to work for any person or company then in competition with the
Corporation or any of its affiliates, or, directly or indirectly, soliciting or
attempting in any manner to persuade or influence any present, future or
prospective customer or client of the Corporation or any of its affiliates to
divert his or its purchases of products or services from the Corporation or any
of its affiliates to any person or company then in competition with the
Corporation or any of its affiliates. Mr. McInnes is prohibited from disclosing
or furnishing information about the Corporation's business to any third party
except as specifically authorized by management of the Corporation or as may
reasonably be necessay to carry out his duties or as demanded by a subpoena duly
served.

19
<PAGE> 23

PERFORMANCE GRAPH

Rules adopted by the Securities and Exchange Commission require that the
Corporation include in the proxy statement a line-graph presentation comparing
cumulative, five-year shareholder returns on an indexed basis with the
cumulative return of a broad equity market index that includes companies whose
equity securities are traded on the same exchange and either a published
industry index or an index of peer companies selected by the Corporation. Since
the Corporation is not included in the Standard and Poor's 500 Stock Index and
its equity securities are traded on the American Stock Exchange, the American
Stock Exchange Market Value Index was selected as the broad equity market index.
Last year, the Corporation chose a group of 18 construction and manufacturing
companies that have operations in those industries in which the Corporation
competes as its peer group for purposes of this performance comparison. A list
of these companies ("Prior Peer Group") follows the graph below. During Fiscal
1994 the Corporation discontinued its construction operations and the financial
results from such operations are included in the Corporation's Financial
Statements as discontinued operations. As a result, the Corporation deleted the
8 construction related companies from the Prior Peer Group to form a New Peer
Group of 10 manufacturing companies that have operations in those industries in
which the Corporation competes for purposes of this performance comparison. A
list of the companies in the New Peer Group follows the graph below. The
Cumulative Total Return for both peer groups are included in the graph for
comparative purposes.

COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN AMONG
BLOUNT, INC., AMERICAN STOCK EXCHANGE MARKET VALUE INDEX,
PRIOR PEER GROUP AND A NEW PEER GROUP

<TABLE>
<CAPTION>
MEASUREMENT PERIOD BLOUNT, INC., ASE MKT. VAL. PRIOR PEER NEW PEER GRO
(FISCAL YEAR COVERED) CLASS A INDEX GROUP UP
<S> <C> <C> <C> <C>
1989 100.00 100.00 100.00 100.00
1990 93.04 112.29 121.98 112.20
1991 116.67 114.35 119.02 96.34
1992 70.56 128.45 102.44 94.97
1993 132.05 122.50 113.02 102.96
1994 289.68 142.70 166.39 174.04
</TABLE>

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

(1) The companies in the Prior Peer Group are as follows: Actava Group, Inc.
(formerly Fuqua Industries, Inc.), Guy F. Atkison Company, Caterpillar,
Inc., Clark Equipment Co., Deere & Co., Foster Wheeler Corp., Halliburton
Co., Jacobs Engineering Group, Inc., Kaydon Corp., Kennametal Inc.,
Morrison-Knudsen Corp., Navistar International Corp., Perini Corp., Regal-
Beloit Corp., Stone & Webster Inc., Terex Corp., The Toro Co., and Turner
Corp.
(2) The companies in the New Peer Group are as follows: Actava Group, Inc.,
Caterpillar, Inc., Clark Equipment Co., Deere & Co., Kaydon Corp.,
Kennametal Inc., Navistar International Corp., Regal-Beloit Corp., Terex
Corp., and the Toro Co.
(3) The comparison of total return on investment (change in year-end stock price
plus reinvested dividends) for each of the periods assumes that $100 was
invested on February 28, 1989 in each of Blount, Inc., the ASE Market Value
Index, the Prior Peer Group, and the New Peer Group, with investment
weighted on the basis of market capitalization.

20
<PAGE> 24

INDEBTEDNESS OF MANAGEMENT

In connection with the employment of Harold E. Layman as Senior Vice
President and Chief Financial Officer of the Corporation in January 1993, the
Corporation made an interest-free loan to him in December 1992 for the purchase
of a home in Montgomery, Alabama pending sale of his home in another city. The
largest aggregate amount of such indebtedness outstanding at any time in Fiscal
1994 was $414,030. The loan was paid in August 1993.

FILING DISCLOSURE

Section 16(a) of the Securities Exchange Act of 1934 and the rules
thereunder require the Corporation's directors, executive officers and persons
who beneficially own more than 10% of any class of equity securities of the
Corporation to file reports of ownership and changes in ownership with the
Securities and Exchange Commission and the American Stock Exchange and to
furnish the Corporation with copies.

Based on the review of copies of such forms received by it, or written
representations from certain reporting persons, the Corporation believes that,
during the last fiscal year all filing requirements applicable to its directors,
officers and greater than 10% beneficial owners were complied with except as
follows:

(a) Joseph W. Blount, a director of HBC, Incorporated which is a
greater than 10% beneficial owner, failed, due to his being out of the
country, to timely file his Form 4 for February 1994. The report was mailed
to the SEC on March 21, 1994.

(b) Thomas J. Fruechtel, President of the Sporting Equipment Division
of the Corporation, failed, due to administrative oversight, to timely file
a Form 3 for his appointment as President of the Division on March 1, 1993.
The Form 3 was mailed to the SEC on April 27, 1993. Mr. Fruechtel also
failed, due to administrative oversight, to timely file his Form 4 for June
1993. The Form 4 was mailed to the SEC on July 13, 1993.

(c) Donald B. Zorn, President of the Forestry and Industrial Equipment
Division of the Corporation, failed, due to administrative oversight, to
timely file a Form 3 for his appointment as President of the Division on
January 12, 1994. The Form 3 was mailed to the SEC on January 24, 1994.

CERTAIN TRANSACTIONS AND OTHER MATTERS

During Fiscal 1994, the Corporation made cash contributions of $566,000 to
The Blount Foundation, Inc., a charitable foundation. D. Joseph McInnes is
President and a director; Katherine Blount Miles is Vice President, Treasurer
and a director; and Winton M. Blount is a director of The Blount Foundation,
Inc.

To secure certain personal indebtedness, Winton M. Blount has pledged to
banks the controlling shares of HBC, Incorporated ("HBC") stock and certain
shares of Class A and Class B Common Stock of the Corporation. In the event of
default in certain of Mr. Blount's personal indebtedness, a change in control of
the Corporation could occur. Mr. Blount has advised the Corporation that he
believes the likelihood of a change in control under such circumstances is
remote.

APPROVAL OF THE 1994 BLOUNT EXECUTIVE STOCK OPTION PLAN

PROPOSAL 2

The Board adopted, subject to approval by the stockholders of the
Corporation, a new stock option plan entitled the 1994 Blount Executive Stock
Option Plan (the "1994 ESO Plan"), the full text of which is set forth in
Exhibit A hereto. The 1994 ESO Plan became effective upon its approval by the
Board on January 24, 1994, subject to the approval by the stockholders.

The 1994 ESO Plan contemplates the grant of the right to purchase shares of
Class A Common Stock of the Corporation under Stock Option Agreements
("Options"). Subject to the usual antidilution provisions of stock splits, stock
dividends, etc., the number of shares of Class A Common Stock which may be
issued under the 1994 ESO Plan may not exceed 400,000 shares. The 1994 ESO Plan
will be administered by the Compensation and Management Development Committee of
the Board (the "Committee"), no member of which is eligible to participate in
the 1994 ESO Plan. Those employees eligible to participate are any officer or
other key management employee (approximately 100 persons) of the Corporation and
its divisions and subsidiaries. The Committee will have sole discretion to
determine from among eligible employees those to whom and the time or times at
which Options may be granted, the number of shares of Class A Common Stock to be
subject to each Option and the period for the exercise of such Options.

The per share exercise price of the Class A Common Stock subject to each
Option may not be less than the fair market value of such stock on the date the
Option is granted. The market value of the Class A Common Stock was $35.4375 on
April 29, 1994.

21
<PAGE> 25

Options must be granted within 10 years from the effective date of the 1994 ESO
Plan, and the period for the exercise of each Option cannot exceed 10 years from
the date of grant.

No Option may be exercised unless and until the optionee has remained in
the employ of the Corporation or its divisions and subsidiaries for 1 year from
the date of grant, except in the case of death, as described below. No Option
will be transferable by an optionee other than by will or the laws of descent
and distribution. During the lifetime of an optionee, the Option will be
exercisable only by the optionee.

In the event an optionee's employment is terminated with or without cause,
or by the act of the optionee including death, before his or her Option has been
in effect for 1 year, the optionee's right to exercise such Incentive Option
shall terminate and all rights thereunder shall cease. In the event an
optionee's employment is terminated with or without cause, or by the act of the
optionee including death, after his or her Option has been in effect for 1 year,
the optionee will have 3 months, except in the case of death as described below,
after such termination within which to exercise such Option to the extent it was
exercisable at the date of such termination.

In the event of the death of an optionee, the executor or administrator of
the estate of the optionee or the person or persons to whom the Option shall
have been validly transferred by the executor or the administrator pursuant to a
will or the laws of descent and distribution shall have the right for 1 year
following the date of death to exercise the optionee's Option to the extent it
was exercisable at the date of death, but not to exceed the original expiration
date of the Option.

During Fiscal 1994, Options to purchase 358,333 shares of Class A Common
Stock of the Corporation were granted, subject to approval of the 1994 ESO Plan
by the stockholders of the Corporation, to 7 key management employees of the
Corporation and its divisions and subsidiaries as follows:

1994 BLOUNT EXECUTIVE STOCK OPTION PLAN

<TABLE>
<CAPTION>
NUMBER OF
NAME AND POSITION OPTIONS(1)
------------------------------------------------------------------------------------------ ----------
<S> <C>
PERSONS NAMED IN THE SUMMARY COMPENSATION TABLE
Winton M. Blount, Chairman and CEO to June 1993, Chairman thereafter 0
John M. Panettiere, President and COO to June 1993, President and CEO thereafter 100,000
James S. Osterman, President of the Oregon Cutting Systems Division 50,000
Harold E. Layman, Senior Vice President and Chief Financial Officer 50,000
D. Joseph McInnes, Senior Vice President -- Administration and Secretary 50,000
OTHER PERSONS WHO RECEIVED 5% OR MORE OF SUCH OPTIONS
Thomas J. Fruechtel, President of the Sporting Equipment Division 50,000
Frank H. McFadden, Executive Vice President and General Counsel 33,333
K. O. Dixon, president of Dixon Industries, Inc., a Subsidiary 25,000
Executive Officers as a Group 358,333
Directors who are not Executive Officers as a Group 0
All Employees, including Officers who are not Executive Officers as a Group 0
</TABLE>

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

(1) See the schedule of Options Granted in Last Fiscal Year on page 14 for
additional information regarding these options.

FEDERAL INCOME TAX CONSEQUENCES

Options granted under the 1994 ESO Plan are not intended to qualify as
"incentive stock options" within the meaning of Section 422A of the U.S.
Internal Revenue Code, as amended.

Under current federal tax law, there are no tax consequences to either the
Corporation or the optionee upon grant of the Option. Upon exercise of the
Option, the excess of the fair market value of the Class A Common Stock acquired
over the option price is taxable to the optionee as compensation income and
deductible by the Corporation. The tax basis for the stock acquired by the
optionee is the option price plus such taxable excess. When an optionee disposes
of shares acquired upon exercise of the option, any amount received in excess of
the tax basis of the shares will be treated as capital gain and will either be
long-term or short-term, depending on the holding period of the shares. The
holding period commences on the date of exercise of the option. If the amount
received on sale is less than the tax basis of the shares, the loss will be
treated as long-term or short-term capital loss, depending upon the holding
period of the shares.

22
<PAGE> 26

MANAGEMENT RECOMMENDATION

By affording key management employees of the Corporation and its divisions
and subsidiaries an opportunity to acquire or increase their equity interest in
the Corporation and by thus encouraging such employees to become owners of the
Corporation's Class A Common Stock, the Corporation seeks to motivate, retain
and attract those highly competent individuals upon whose judgment, initiative,
leadership and continued efforts the success of the Corporation in large measure
depends. For this reason, the management of the Corporation recommends to the
stockholders of the Corporation that they vote FOR approval of the 1994 ESO
Plan.

VOTE REQUIRED

The affirmative vote of the majority of the stock having voting power
present in person or represented by proxy at the Annual Meeting of Stockholders
is required for approval of the 1994 ESO Plan. Proxies solicited hereby will be
voted FOR the proposal unless a vote against the proposal or abstention is
specifically indicated.

APPROVAL OF THE EXECUTIVE MANAGEMENT TARGET INCENTIVE PLAN

PROPOSAL 3

The Board adopted, subject to approval by the stockholders of the
Corporation, a new performance based incentive plan for senior executive
officers entitled the Executive Management Target Incentive Plan (the "Executive
Incentive Plan"), the full text of which is set forth in Exhibit B hereto. The
Executive Incentive Plan became effective as of March 1, 1994 upon its approval
by the Board on April 13, 1994, but no payments may be made under the Executive
Incentive Plan unless it is approved by the stockholders.

The Executive Incentive Plan provides for the payment of a monetary award
("Target Award") to participants based upon the achievement of a targeted
performance goal set by the Compensation and Management Development Committee of
the Board (the "Committee") and communicated annually to participants before the
beginning of the fiscal year of the Corporation, except that the performance
goal for the fiscal year beginning March 1, 1994 was communicated to
participants prior to March 31, 1994. The Executive Incentive Plan will be
administered by the Committee, no member of which is eligible to participate in
the Executive Incentive Plan. Participation in the Executive Incentive Plan is
limited to the Chairman of the Board and the President and Chief Executive
Officer of the Corporation (2 persons).

The Executive Incentive Plan provides that the Corporation's income after
income taxes but before extraordinary items, discontinued operations and the
cumulative effect of accounting changes as reported each year in the Annual
Report to Shareholders shall be the performance goal used to determine if a
Target Award is earned under the Executive Incentive Plan. The performance goal
established by the Committee will be expressed in terms of a minimum performance
goal, targeted performance goal and maximum performance goal.

Target Awards are stated in terms of a percent ("Target Bonus Percent")
times a participant's annual base salary paid during a fiscal year of the
Corporation. The Target Bonus Percent for the Chairman of the Board and for the
President and Chief Executive Officer is 65% of base salary. Participants can
earn from 80% (minimum threshold) to 200% (maximum award) of a Target Award
based on the percent of the targeted performance goal achieved for the fiscal
year. No Target Award is payable under the Executive Incentive Plan if actual
income as defined above for a given fiscal year is less than 80% of the targeted
performance goal established by the Committee. The maximum payment to all
participants in any fiscal year of the Corporation cannot exceed $2 million
divided equally among the participants. The Committee shall determine that the
performance goal that warrants payment under the Executive Incentive Plan has
been met and approve any payment due.

Assuming all other Award requirements are met and subject to approval by
the Committee, pro rata Target Awards for any fiscal year will be made to
participants who are (i) appointed to participate after the beginning of a
fiscal year; (ii) placed on unpaid leave of absence because of disability or for
personal reasons after the beginning of a fiscal year; (iii) demoted or removed
as a participant after the beginning of a fiscal year; (iv) transferred to a
position which does not qualify as a participant after the beginning of a fiscal
year; or (v) retired after the beginning of a fiscal year.

In the event of death of a participant during a fiscal year, a pro rata
award will be paid to the participant's beneficiary if all other Target Award
requirements are met. No Target Award, pro rata or complete, will be paid to a
participant who is discharged for cause or voluntarily leaves the Corporation
prior to the end of a fiscal year. The Executive Incentive Plan shall remain in
effect for a period of 5 years from March 1, 1994 unless terminated earlier by
the Committee.

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<PAGE> 27

The potential Target Awards for the 2 participants in the Executive
Incentive Plan for the fiscal year beginning March 1, 1994 based on the annual
salary then in effect and assuming the targeted performance goal for the year is
met are as follows:

EXECUTIVE MANAGEMENT TARGET INCENTIVE PLAN

<TABLE>
<CAPTION>
NAME AND POSITION TARGET AWARD($)
--------------------------------------------------------------------------------------- ---------------
<S> <C>
PERSONS NAMED IN THE SUMMARY COMPENSATION TABLE
Winton M. Blount, Chairman of the Board 442,000
John M. Panettiere, President and CEO 357,500
</TABLE>

MANAGEMENT RECOMMENDATION

By affording the Chairman of the Board and the President and CEO who, by
the nature of their duties, are in a position to contribute to the successful
annual performance of the Corporation an opportunity to receive monetary awards
for the achievement of annual performance goals, the Corporation seeks to
enhance the interest of its executive management, provide competitive incentive
compensation consistent with targeted performance goals, and to grow and build
shareholder value as a result of achieving desired financial and other strategic
goals and growth rates above the average of the Corporation's peer group. For
these reasons, the management of the Corporation recommends to the stockholders
of the Corporation that they vote FOR approval of the Executive Incentive Plan.

VOTE REQUIRED

The affirmative vote of the majority of the stock having voting power
present in person or represented by proxy at the Annual Meeting of Stockholders
is required for approval of the Executive Incentive Plan. Proxies solicited
hereby will be voted FOR the proposal unless a vote against the proposal or
abstention is specifically indicated.

RATIFY THE APPOINTMENT OF INDEPENDENT AUDITORS

PROPOSAL 4

Upon recommendation of the Audit Committee, the Board has appointed the
firm of Coopers & Lybrand as its independent auditors for the fiscal year ending
February 28, 1995. Although stockholder ratification is not required, the Board
has determined that it would be desirable to request an expression from the
stockholders as to whether or not they concur in the foregoing appointment.

Coopers & Lybrand has served as auditors of the consolidated financial
statements of the Corporation and its divisions and subsidiaries from year to
year since 1972. The Corporation has been advised by Coopers & Lybrand that they
do not have any direct financial interest or any material indirect financial
interest in the Corporation or any of its divisions or subsidiaries, and that
during the above time, Coopers & Lybrand has not had any connection with the
Corporation or its divisions or subsidiaries in the capacity of promoter,
underwriter, voting trustee, director, officer or employee.

Representatives of Coopers & Lybrand and of the Audit Committee of the
Board will be present at the Meeting and will have the opportunity to make a
statement if they desire to do so. Those representatives will also be available
to respond to appropriate questions.

The Audit Committee of the Board approved all non-audit services rendered
by Coopers & Lybrand during Fiscal 1994 and concluded that such services did not
affect the independence of the auditors. The audit services provided by Coopers
& Lybrand included the audit of the consolidated financial statements of the
Corporation for Fiscal 1994, audit of certain subsidiary financial statements
for Fiscal 1994, review of various filings with the Securities and Exchange
Commission, and performance of such other appropriate auditing services as were
required by management or the Board. The non-audit services include, among other
things, tax services and special services regarding accounting issues.

Coopers & Lybrand has advised that all professional services were provided
at customary rates and terms.

The Board recommends a vote FOR ratification of the appointment of Coopers
& Lybrand as independent auditors for the Corporation for the fiscal year ending
February 28, 1995. If the stockholders should not ratify the appointment of
Coopers & Lybrand, the Board will reconsider the appointment.

24
<PAGE> 28

STOCKHOLDERS' PROPOSALS FOR 1995 ANNUAL MEETING

Stockholders may present proposals which may be proper subjects for
inclusion in the Proxy Statement and for consideration at the Annual Meeting of
Stockholders. In order to be considered, proposals must be submitted on a timely
basis. Proposals for the 1995 Annual Meeting of Stockholders must be received by
the Corporation no later than February 1, 1995. Any such proposals, as well as
any questions related thereto, should be directed to the Secretary of the
Corporation.

GENERAL INFORMATION

The Board does not presently know of any other business to be presented at
the Meeting. However, if any other matters properly come before the Meeting, the
persons whose names appear on the enclosed form or forms of proxy will vote
thereon in accordance with their best judgment.

The expenses of soliciting proxies will be paid by the Corporation. In
addition to the use of the mails, proxies may be solicited personally, or by
telephone or facsimile, by directors, officers and regular employees of the
Corporation and its divisions and subsidiaries, who, except for normal overtime
pay in certain instances, will not receive additional compensation therefor.
Arrangements will also be made with brokerage firms and other custodians,
nominees and fiduciaries for the forwarding of proxy soliciting materials to
beneficial owners of the Corporation's Class A Common Stock and Class B Common
Stock, and the Corporation will reimburse such brokerage firms, custodians,
nominees and fiduciaries for reasonable out-of-pocket expenses incurred by them
in connection therewith.

By Order of the Board of Directors,

D. Joseph McInnes
Senior Vice President -- Administration
and Secretary

Montgomery, Alabama
May 18, 1994

25
<PAGE> 29

EXHIBIT A

BLOUNT, INC.
1994 BLOUNT EXECUTIVE STOCK OPTION PLAN

ARTICLE I
DEFINITIONS

SEC. 1.1 DEFINITIONS

As used herein, the following terms shall have the meanings hereinafter set
forth unless the context clearly indicates to the contrary:

(a) "Company" shall mean Blount, Inc., a Delaware corporation.

(b) "Board" shall mean the Board of Directors of the Company.

(d) "Covered Employee" shall mean any individual who, as of the last
day of the Company's taxable year, is either the Chief Executive Officer of
the Company or is acting in such capacity, or is among the four highest
compensated officers of the Company other than the Chief Executive Officer.

(e) "Committee" shall mean the Compensation and Management Development
Committee of the Board consisting of two (2) or more persons.

(f) "Stock," with respect to each share to which that term refers,
shall mean one (1) share of Class A Common Stock of the Company, par value
$1.00 per share.

(g) "Fair Market Value" shall mean the average of the highest price
and the lowest price per share at which the Stock is sold in the regular
way on the American Stock Exchange on the day an Option is granted
hereunder or, in the absence of any reported sales on such day, the first
preceding day on which there were such sales.

(h) "Fundamental Change" shall mean any of the following events:

(i) the sale by the Company of substantially all of its assets to a
single purchaser or a group of associated or affiliated purchasers;

(ii) the sale, exchange, or other disposition, in one transaction
to an entity or entities not affiliated with the Company, of more than
fifty percent (50%) of the outstanding common stock of the Company other
than a sale, exchange, or disposition of the common stock of the Company
resulting from a public or private offering of common stock or other
security convertible into common stock of the Company which offering is
sponsored or initiated by the Company and approved by the Board;

(iii) the merger or consolidation of the Company in a transaction
in which the stockholders of the Company receive less than fifty percent
(50%) of the outstanding voting stock of the new or continuing entity;
or

(iv) a change in control of the Board as constituted on the date
this is adopted by the Board.

(i) "Option" shall mean an option to purchase Stock granted pursuant
to the provisions of Article VI hereof.

(j) "Optionee" shall mean an employee to whom an Option has been
granted hereunder.

(k) "Plan" shall mean the 1994 Blount Executive Stock Option Plan, the
terms of which are set forth herein.

(l) "Stock Option Agreement" shall mean the agreement between the
Company and the Optionee under which the Optionee may purchase Stock
hereunder.

(m) "Subsidiary" shall mean any corporation, the majority of the
outstanding capital stock of which is owned, directly or indirectly, by the
Company.

A-1
<PAGE> 30

ARTICLE II
THE PLAN

SEC. 2.1 NAME

This plan shall be known as the "1994 Blount Executive Stock Option Plan".

SEC. 2.2 PURPOSE

The purpose of the Plan is to advance the interests of the Company and its
stockholders by affording to key management employees of the Company and its
subsidiaries an opportunity to acquire or increase their proprietary interest in
the Company and to allow such employees to benefit directly from improved
performance of the Company by the grant to such employees of Options under the
terms set forth herein. By thus encouraging such employees to become owners of
the Company stock and allowing them to benefit directly from improved
performance of the Company, the Company seeks to motivate, retain and attract
those highly competent individuals upon whose judgment, initiative, leadership
and continued efforts the success of the Company in large measure depends. The
Options granted under this Plan are not intended to qualify as incentive stock
options under Section 422 of the Code.

SEC. 2.3 EFFECTIVE DATE

The Plan shall be deemed adopted and shall become effective upon its
approval by the Board subject to its subsequent approval within 12 months of
adoption by the Board by the stockholders of the Company at an annual or special
meeting of the stockholders of the Company. No option granted hereunder may
become exercisable unless and until such approval is obtained. Any subsequent
amendments to the Plan requiring the consent of the stockholders of the Company
shall become effective upon approval of such amendments by the Board and by the
affirmative vote of the majority of the outstanding shares of Stock of the
Company at any annual or special meeting of the stockholders of the Company and,
if necessary, upon the filing of appropriate certificates of amendment to the
Certificate of Incorporation of the Company with the appropriate authorities in
the State of Delaware.

ARTICLE III
PARTICIPANTS

SEC. 3.1 ELIGIBILITY

Any officer or other key management employee of the Company or its
subsidiaries shall be eligible to participate in the Plan; provided, however,
that no member of the Committee shall be eligible to receive equity securities
or options of the Company under the Plan or equity securities or options of the
Company under any other plan of the Company while serving on the Committee or
for a period of one year prior to serving on the Committee, except to the extent
permitted and still retain qualification of the Plan for exemption from the
provisions of Section 16(b) of the Securities Exchange Act of 1934 under Rule
16(b)(3) under the Securities Exchange Act of 1934. The Committee may grant
Options to any eligible employee in accordance with such determinations as the
Committee from time to time in its sole discretion shall make.

ARTICLE IV
ADMINISTRATION

SEC. 4.1 DUTIES AND POWERS OF COMMITTEE

The Plan shall be administered by the Committee. Subject to the express
provisions of the Plan, the Committee shall have sole discretion and authority
to determine from among eligible employees those to whom and the time or times
at which Options may be granted, the number of shares of Stock to be subject to
each Option, and the period for the exercise of such Option which need not be
the same for each grant hereunder. Subject to the express provisions of the
Plan, the Committee shall also have complete authority to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to it, to determine
the details and provisions of each Stock Option Agreement, and to make all other
determinations necessary or advisable in the administration of the Plan.

SEC. 4.2 MAJORITY RULE

A majority of the members of the Committee shall constitute a quorum, and
any action taken by a majority present at a meeting at which a quorum is present
or any action taken without a meeting evidenced by a writing executed by a
majority of the whole Committee shall constitute the action of the Committee.

A-2
<PAGE> 31

SEC. 4.3 COMPANY ASSISTANCE

The Company shall supply full and timely information to the Committee on
all matters relating to eligible employees, their employment, death, or other
termination of employment, and such other pertinent facts as the Committee may
require. The Company shall furnish the Committee with such clerical and other
assistance as is necessary in the performance of its duties.

ARTICLE V
SHARES OF STOCK SUBJECT TO PLAN

SEC. 5.1 LIMITATIONS

Subject to adjustment pursuant to the provisions of Section 5.3 hereof, the
number of shares of Stock which may be issued and sold hereunder shall not
exceed 400,000 shares of Stock. Such shares may be either authorized and
unissued shares or shares issued and thereafter acquired by the Company. The
maximum number of shares with respect to which Options may be granted to any
individual who has been a Covered Employee at any time during the term of the
Plan is 100,000.

SEC. 5.2 OPTIONS GRANTED UNDER PLAN

Shares of Stock with respect to which an Option granted hereunder shall
have been exercised shall not again be available for grant hereunder. If Options
granted hereunder shall expire, terminate or be canceled for any reason without
being wholly exercised, new Options may be granted hereunder covering the number
of shares to which such Option expiration, termination or cancellation relates.

SEC. 5.3 ANTIDILUTION AND FUNDAMENTAL CHANGE

In the event that the outstanding shares of Stock hereafter are changed
into or exchanged for a different number or kind of shares or other securities
of the Company or of another corporation by reason of merger, consolidation,
other reorganization, recapitalization, reclassification, combination of shares,
stock split-up or stock dividend:

(a) the aggregate number and kind of shares subject to Options which
may be granted hereunder shall be adjusted appropriately;

(b) rights under outstanding Options granted hereunder, both as to the
number of subject shares and the Option price, shall be adjusted
appropriately;

(c) where dissolution or liquidation of the Company is involved, each
outstanding Option granted hereunder shall terminate, but the Optionee
shall have the right, subject to the other provisions of the Plan, for
thirty (30) days prior to such dissolution or liquidation, to exercise his
Option in full, without regard to any installment exercise provisions, to
the extent that it shall not have been exercised;

The foregoing adjustments and the manner of application of the foregoing
provisions shall be determined solely by the Committee, and any such adjustment
shall provide for the elimination of fractional share interests.

In the event of a Fundamental Change, every Option outstanding shall
terminate, provided that for a period of thirty (30) days prior to the effective
date of such Fundamental Change and subject to the other provisions of the Plan,
except for Section 6.4(a) which shall not apply, Optionee shall have the right
to exercise his Option in full, without regard to any installment exercise
provisions, to the extent that it shall not have been exercised.

ARTICLE VI
OPTIONS

SEC. 6.1 OPTION GRANT AND AGREEMENT

Each Option granted hereunder shall be evidenced by minutes of a meeting or
the written consent of the Committee and by a Stock Option Agreement dated as of
the date of grant and executed by the Company and the Optionee, which Agreement
shall set forth such terms and conditions as may be determined by the Committee
consistent with the Plan. Such Agreement shall bind the Optionee to provide
written notice to the Company in the event that the Optionee shall make an
election under Section 83(b) of the Code with respect to any Stock purchased
through exercise of an Option under this Plan; such written notice shall be
presented to the Company no later than ten (10) days following the filing of
such election.

A-3
<PAGE> 32

SEC. 6.2 OPTION PRICE

The per share price of the Stock subject to each Option shall be determined
by the Committee, but said per share price shall not be less than the Fair
Market Value of the Stock on the date the Option is granted.

SEC. 6.3 OPTION PERIOD

Each Option granted hereunder must be granted within ten years from the
effective date of the Plan. The period for the exercise of each Option shall be
determined by the Committee, but in no instance shall such period exceed ten
years from the date of grant of the Option.

SEC. 6.4 OPTION EXERCISE

(a) No Option granted hereunder shall be exercisable unless and until the
Optionee shall have been or remained in the employ of the Company or its
subsidiaries for one year from and after the date such Option was granted,
except as otherwise provided in Section 6.6 hereof.

(b) Options may be exercised with respect to whole shares only, for such
shares of Stock and within the period permitted by the exercise thereof as
determined by the Committee, and shall be exercised by written notice of intent
to exercise the Option with respect to a specified number of shares delivered to
the Company at its principal office in the State of Alabama, and payment in full
in cash to the Company at said office of the amount of the Option price for the
number of shares of Stock with respect to which the Option is then being
exercised. If and to the extent that the Company is required to withhold on
account of any present or future tax imposed by any taxing authority with
respect to such exercise, the notice of exercise shall be accompanied by a check
to the order of the Company in payment of the amount of such withholding, as
determined by the Company in its sole discretion.

(c) No Option granted hereunder shall be exercisable unless at all times
during the period beginning on the date of the granting of such Option and
ending on the day which is three months before the date of exercise (or ending
on the day which is twelve months before the date of exercise in case of the
death of the Optionee) the Optionee was an employee of either the Company or a
parent or Subsidiary of the Company, or a corporation (or parent or subsidiary
of such corporation) issuing or assuming such Option.

SEC. 6.5 NONTRANSFERABILITY OF OPTION

No Option shall be transferred by an Optionee otherwise than by will or the
laws of descent and distribution. During the lifetime of an Optionee the Option
shall be exercisable only by the Optionee.

SEC. 6.6 EFFECT OF DEATH OR OTHER TERMINATION OF EMPLOYMENT

(a) If, prior to a date one year from the date an Option shall have been
granted, the Optionee's employment with the Company or its subsidiaries shall be
terminated by the Company or Subsidiary with or without cause, or by the act of
the Optionee including death, the Optionee's right to exercise such Option shall
terminate and all rights thereunder shall cease.

(b) If on or subsequent to a date one year from the date an Option shall
have been granted, the Optionee's employment with the Company or its
subsidiaries shall be terminated by the Company or subsidiaries with or without
cause, or by the act of the Optionee including death, the Optionee's right to
exercise such Option shall extend only to the number of shares under the Option
which such Optionee has on such date a fully vested right to exercise the Option
with respect thereto. The Option with respect to all remaining shares shall
terminate, and except as set forth in this Plan all rights under the Option
shall cease.

(c) In the event of the death of an Optionee, the executor or administrator
of the estate of the Optionee or the person or persons to whom an Option granted
hereunder shall have been validly transferred by the executor or the
administrator pursuant to will or the laws of descent and distribution shall
have the right to exercise the Optionee's Option for one year following the date
of death (but not to exceed the original expiration date of the Option).

(d) No transfer of an Option by the Optionee by will or by the laws of
descent and distribution shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and an
authenticated copy of the will and/or such other evidence as the Committee may
deem necessary to establish the validity of the transfer and the acceptance by
the transferee or transferees of the terms and conditions of such Option.

SEC. 6.7 RIGHTS AS STOCKHOLDER

An Optionee or a transferee of an Option shall have no rights as a
stockholder with respect to any shares subject to such Option prior to the
purchase of such shares by exercise of such Option as provided herein.

A-4
<PAGE> 33

ARTICLE VII
STOCK CERTIFICATES

SEC. 7.1 STOCK CERTIFICATES

The Company shall not be required to issue or deliver any certificate for
shares of Stock purchased upon the exercise of any Option granted hereunder or
any portion thereof, prior to fulfillment of all of the following conditions:

(a) the admission of such shares to listing on all stock exchanges on
which the Stock is then listed;

(b) the completion of any registration or other qualification of such
shares under any federal or state law or under the rulings or regulations
of the U.S. Securities and Exchange Commission or any other governmental
regulatory body, which the Committee shall in its sole discretion deem
necessary or advisable;

(c) the obtaining of any approval or other clearance from any federal
or state governmental agency which the Committee shall in its sole
discretion determine to be necessary or advisable; and

(d) the lapse of such reasonable period of time following the exercise
of the Option as the Committee from time to time may establish for reasons
of administrative convenience.

ARTICLE VIII
TERMINATION, AMENDMENT AND MODIFICATION OF THE PLAN

SEC. 8.1 TERMINATION, AMENDMENT AND MODIFICATION OF THE PLAN

The Board may at any time terminate, and may at any time and from time to
time and in any respect amend or modify, the Plan; provided, however, that no
such action of the Board without approval of the stockholders of the Company
may:

(a) increase the total number of shares of Stock subject to the Plan
except as contemplated in Section 5.3 hereof;

(b) change the manner of determining the Option price;

(d) permit any person while a member of the Committee to be eligible
to receive an Option under the Plan; and

provided further, that no termination, amendment or modification of the Plan
shall in any manner affect any Stock Option Agreement theretofore granted
pursuant to the Plan without the consent of the Optionee or transferee of the
Option and provided further that any amendment which if not approved by
Stockholders of the Company would adversely affect the qualification of the Plan
for exemption from the provisions of Section 16(b) of Securities Exchange Act of
1934 under Rule 16(b)(3) under the Securities Exchange Action of 1934 will
require approval of the Stockholders of the Company.

ARTICLE IX
MISCELLANEOUS

SEC. 9.1 EMPLOYMENT

Nothing in the Plan or in any Option granted hereunder or in any Stock
Option Agreement relating thereto shall confer upon any employee the right to
continue in the employ of the Company or any Subsidiary.

SEC. 9.2 OTHER COMPENSATION PLANS

The adoption of the Plan shall not affect any other stock option or
incentive or other compensation plans in effect for the Company or any
Subsidiary, nor shall the Plan preclude the Company from establishing any other
forms of incentive or other compensation for employees of the Company or any
Subsidiary.

SEC. 9.3 PLAN BINDING ON SUCCESSORS

The Plan shall be binding upon the successors and assigns of the Company.

SEC. 9.4 SINGULAR, PLURAL; GENDER

Whenever used herein, nouns in the singular shall include the plural, and
the masculine pronoun shall include the feminine gender.

SEC. 9.5 HEADINGS, ETC., NO PART OF PLAN

Headings of Articles and Sections hereof are inserted for convenience and
reference; they constitute no part of the Plan.

A-5
<PAGE> 34

EXHIBIT B
BLOUNT, INC.
EXECUTIVE MANAGEMENT TARGET INCENTIVE PLAN

I. DEFINITIONS

As used herein, the following terms shall have the meanings hereinafter set
forth unless the context clearly indicates to the contrary:

(a) "Board" shall mean the Board of Directors of the Company.

(b) "Company" shall mean Blount, Inc., a Delaware corporation.

(c) "Committee" shall mean the Compensation Management Development
Committee of the Board. This Committee is appointed by the Blount, Inc.
Board from those of its members not eligible for awards under the
provisions of this Plan. It is comprised of not less than 3 outside
Directors of the Board (a simple majority of whom will constitute a quorum)
and has primary responsibility for interpretation of the terms and
provision of the Plan.

(d) "Plan" shall mean the Executive Management Target Incentive Plan,
effective as of March 1, 1994.

(e) "Net Income" shall mean income after taxes but before
extraordinary items, discontinued operations and the cumulative effect of
accounting changes as reported each year in the Company's Annual Report to
shareholders.

II. PLAN OBJECTIVES

The Plan is designed to address the following corporate-wide objectives:

(a) To enhance the interests of Blount executive management by
providing monetary awards for achievement of annual performance goals and
as an incentive to retain outstanding executive employees.

(b) To provide competitive incentive compensation consistent with
targeted performance goals.

(c) To grow and build shareholder value as a result of achieving
desired financial and other strategic goals at growth rates above the
average of the Company's peer group.

III. PLAN ADMINISTRATION

The Committee has primary responsibility for interpretation and
administration of the terms and provisions of the Plan. Such responsibility
includes, but is not limited to setting performance targets, conducting
consultations with officers and other executives of the Company as needed to
perform the Committee's duties, promulgating necessary rules, guidelines, and
procedures for administration of the Plan, and engaging or employing counsel,
advisors, or consultants, and any other persons as it may deem necessary or
expedient for the performance of its responsibilities under the Plan.

The Senior Vice President, Administration and Secretary of the Company will
serve the Committee as the chief personnel resource for matters relating to the
Plan. While the Committee is free to delegate any duties and responsibilities it
deems appropriate, all decisions regarding participation, performance and
payments under the Plan will be made solely by the Committee. All decisions,
determinations and interpretations of the Committee with respect to the Plan
will be binding upon all persons.

No member of the Committee shall be liable by reason of contract or other
instrument executed by him or on his behalf in his capacity as a member of such
committee nor for any mistake of judgment made in good faith.

IV. PLAN PARTICIPATION

Participation in the Plan is limited to the Chairman of the Board of the
Company and the President and Chief Executive Officer of the Company who, by the
nature of their duties, are in a position to contribute to the successful annual
performance of the Company.

V. CALCULATION OF AWARDS

Target Awards -- Each potential Target Award is stated in terms of a Target
Bonus Percent times a participant's Annual Base Salary paid during a fiscal
year. This is the amount that will be earned and paid if the performance measure
is met during the fiscal year. The participant's Target Award is based on the
Net Income (as defined in Section I) of the Company. The Target Bonus Percent
for the Chairman of the Board and for the President and Chief Executive Officer
is 65% of base salary. Participants can earn from 80% (minimum threshold) to
200% (maximum bonus) of a Target Award. No Target Award is payable if the Net
Income is less than 80% of the Net Income goal established by the Committee. The
maximum payment to all participants covered by the Plan in any fiscal year
cannot exceed $2 million (divided equally among the participants).

Plan Funding -- Payment under the Plan is determined by the cumulative
profitability of the Company's divisions and subsidiaries. As a result, for any
awards to be paid, the appropriate Net Income goal must be equaled or exceeded.

B-1
<PAGE> 35

Performance Measures -- During the annual planning and budgeting process by
the Corporation the Committee will develop the Net Income goal for each upcoming
fiscal year. The measure will be expressed in terms of a minimum performance
goal, targeted performance goal, and maximum performance goal. For the fiscal
year beginning on or after March 1, 1995, the approved performance goal will be
communicated annually (and not later than the first business day of the subject
fiscal year) to the Plan participants as a means of motivating such participants
to achieve common corporate goals. For the fiscal year ending February 28, 1995,
the approved performance goal will be communicated no later than March 31, 1994.

VI. PAYMENT OF AWARDS

Earned awards will be paid as soon as practical after final determination
that the performance goals that warrant payment have been met. Final
determinations will be reviewed and approved by the Committee prior to payment.
No payment can be made under this Plan until it is approved by the shareholders
of the Company.

VII. SPECIAL SITUATIONS AFFECTING AWARDS

Assuming all other award requirements are met, pro rata awards for any
fiscal year, subject to the Committee's approval, will be made to participants
who are:

(a) appointed to participation in the Plan after the beginning of a
Plan fiscal year;

(b) placed on unpaid leave of absence because of disability or for
personal reasons after the beginning of a Plan fiscal year;

(d) transferred to a position which does not qualify for membership in
the Plan after the beginning of a Plan fiscal year; or

(e) retired after the beginning of a Plan fiscal year.

Assuming all other award requirements are met, in the event of the death of
a participant during a Plan fiscal year, a pro rata award will be paid to the
participant's beneficiary.

No awards, pro rata or complete, will be paid to participants who:

(a) are discharged for cause; or

(b) voluntarily leave the Company prior to the end of a Plan fiscal
year.

VIII. GENERAL RESTRICTIONS, OBLIGATIONS AND RIGHTS

No Employment Rights or Participation Guarantees -- Participation in the
Plan during a Plan fiscal year does not ensure an award payment, participation
in future Plan years, or the right to continue employment with the Company.
Nothing in the Plan shall interfere with the right of the Company to terminate a
participant's employment at any time.

Plan Document -- Each participant in the Plan will be provided with a copy
of the Plan. All Plan awards are subject to all the terms and provisions of the
Plan. No officer or other individual is entitled to make any representation or
commitment contrary or in addition to those appearing in the Plan.

Binding Upon Successors -- The obligations of the Company under the Plan
shall be binding upon any successor or other organization which shall succeed to
substantially all of the assets and business of the Company and the term
"Company," whenever used in the Plan, shall mean and include any such
corporation or organization after such succession. If the business conducted by
the Company shall be discontinued, any unpaid installments under the Plan shall
become payable in a lump sum to the person or persons then entitled to such
payments.

IX. PLAN REVISIONS OR TERMINATION

The Committee reserves the right to revise or terminate the Plan in the
event of a major reorganization of all or a portion of the Company. If the Plan
is terminated during a Plan fiscal year, any incentive payments will be
determined by using the appropriate fiscal year-end figures and prorating those
figures for that portion of the year the Plan was in effect. For the purpose of
determining individual awards in the event of Plan termination or revision, base
salary paid during the period the Plan was in effect will be used.

X. TERMS

The Plan shall remain in effect for a period of five years from March 1,
1994 unless terminated under Section IX.

B-2
<PAGE> 36

BLOUNT, INC.
4520 EXECUTIVE PARK DRIVE BLOUNT [LOGO]
MONTGOMERY, ALABAMA 36116-1602

PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS CLASS A COMMON STOCK
FOR THE ANNUAL MEETING OF STOCKHOLDERS ON JUNE 27, 1994

The undersigned, revoking previous proxies, if any, relating to these shares,
hereby acknowledges receipt of the Notice and Proxy Statement dated May 18, 1994
in connection with the Annual Meeting of Stockholders to be held at 10:00 A.M.,
C.D.T., on Monday, June 27, 1994, in the Wilson Auditorium of the Montgomery
Museum of Fine Arts, One Museum Drive, Montgomery, Alabama 36117, and hereby
appoints HAROLD E. LAYMAN, D. JOSEPH McINNES and FRANK H. McFADDEN, or either
one of them acting in the absence of the other, the proxies of the undersigned,
with power of substitution to each, to represent and vote, as designated below,
all shares of Class A Common Stock of Blount, Inc. registered in the name
provided herein as of April 29, 1994 which the undersigned is entitled to vote
at the 1994 Annual Meeting of Stockholders, and at any adjournment thereof, with
all the powers the undersigned would have if personally present.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS NUMBERED 1, 2, 3,
AND 4.

<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS. / / FOR nominees listed below / / WITHHOLD AUTHORITY
(Except as marked to the contrary to vote for all nominees listed below
below)

Nominees: Herbert J. Dickson, James W. Hargrove and Mary D. Nelson
Instruction: To withhold authority to vote for any individual, write that nominee's name here:____________________________________

2. APPROVE THE 1994 BLOUNT EXECUTIVE STOCK OPTION PLAN. / / FOR / / AGAINST / / ABSTAIN
3. APPROVE THE EXECUTIVE MANAGEMENT TARGET INCENTIVE PLAN. / / FOR / / AGAINST / / ABSTAIN
4. RATIFY THE APPOINTMENT OF COOPERS & LYBRAND as the independent auditors / / FOR / / AGAINST / / ABSTAIN
for the Corporation for the fiscal year ending February 28, 1995.
5. In their discretion on such other business as may properly come before / / FOR / / AGAINST / / ABSTAIN
the meeting.
</TABLE>

This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. IF NO DIRECTION IS GIVEN, THIS PROXY WILL
BE VOTED "FOR" PROPOSALS NUMBERED 1, 2, 3, AND 4.

<TABLE>
<S> <C> <C>
________________________________ _____________________________________ Dated:__________________________________,1994
Signature of Stockholder Signature of Stockholder
</TABLE>

Please mark, sign exactly as your name is printed hereon and return in the
enclosed envelope. If the stock is held jointly, each joint owner must sign.
When signing as Attorney, Executor, Administrator, Trustee, Guardian or in any
other representative capacity, please give full title.
<PAGE> 37

BLOUNT, INC.
4520 EXECUTIVE PARK DRIVE [LOGO]
MONTGOMERY, ALABAMA 36116-1602

PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS CLASS B COMMON STOCK
FOR THE ANNUAL MEETING OF STOCKHOLDERS ON JUNE 27, 1994

The undersigned, revoking previous proxies, if any, relating to these shares,
hereby acknowledges receipt of the Notice and Proxy Statement dated May 18, 1994
in connection with the Annual Meeting of Stockholders to be held at 10:00 A.M.,
C.D.T., on Monday, June 27, 1994, in the Wilson Auditorium of the Montgomery
Museum of Fine Arts, One Museum Drive, Montgomery, Alabama 36117, and hereby
appoints HAROLD E. LAYMAN, D. JOSEPH McINNES and FRANK H. McFADDEN, or either
one of them acting in the absence of the other, the proxies of the undersigned,
with power of substitution to each, to represent and vote, as designated below,
all shares of Class B Common Stock of Blount, Inc. registered in the name
provided herein as of April 29, 1994 which the undersigned is entitled to vote
at the 1994 Annual Meeting of Stockholders, and at any adjournment thereof, with
all the powers the undersigned would have if personally present.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS NUMBERED 1, 2, 3,
AND 4.

<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS. / / FOR nominees listed below / / WITHHOLD AUTHORITY
(Except as marked to the contrary to vote for all nominees listed below
below)
Nominees: Winton M. Blount, W. Houston Blount, C. Todd Conover, H. Corbin Day, Alfred M. Gleason, John M. Panettiere,
Arthur P. Ronan and Joab L. Thomas
Instruction: To withhold authority to vote for any individual, write that nominee's name here:____________________________________

<TABLE>
<S> <C> <C>
______________________________ _________________________________ Dated:______________________________,1994
Signature of Stockholder Signature of Stockholder
</TABLE>