FLOW INTERNATIONAL CORP, DEF 14A, 1995-07-31

FLOW INTERNATIONAL CORP
DEF 14A, 1995-07-31
GENERAL INDUSTRIAL MACHINERY & EQUIPMENT, NEC

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<PAGE> 1

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934

Filed by the Registrant /X/

Filed by a Party other than the Registrant / /

Check the appropriate box:

<TABLE>
<S> <C>
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>

FLOW INTERNATIONAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

FLOW INTERNATIONAL CORPORATION
- --------------------------------------------------------------------------------
(Name of Person Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):

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

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

N/A
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1

N/A
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(4) Proposed maximum aggregate value of transaction:

N/A
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(5) Total fee paid:

N/A
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1 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:

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

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(3) Filing Party:

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(4) Date Filed:

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<PAGE> 2
PROXY STATEMENT

[FLOW INTERNATIONAL CORPORATION LOGO]

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
AUGUST 30, 1995

To the Stockholders of Flow International Corporation:

NOTICE IS HEREBY GIVEN that the Annual Meeting of the Stockholders of Flow
International Corporation, a Delaware Corporation, will be held on Wednesday,
August 30, 1995, at 10:00 a.m., Pacific Daylight Time, at the Washington
Athletic Club, 1325 Sixth Avenue, Seattle, Washington 98111, for the following
purposes as described in the attached Proxy Statement:

1. To elect three directors to hold office for three-year terms ending at
the 1998 Meeting of Stockholders and one director to hold office for a
one-year term ending at the 1996 Meeting of Stockholders or until their
respective successors are elected and qualified;

2. To approve the Company's 1995 Long-Term Incentive Compensation Plan;

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

Pursuant to the By-Laws, the Board of Directors has fixed the close of
business on July 17, 1995, as the record date for determination of stockholders
of the Company entitled to receive notice of and to vote at the Annual Meeting.

So far as Management is aware, no business will properly come before the
Annual Meeting other than the matters set forth above.

IF YOU CANNOT BE PRESENT AT THE MEETING, YOU ARE REQUESTED TO SIGN, DATE,
AND RETURN THE ENCLOSED PROXY CARD APPOINTING RONALD W. TARRANT, THOMAS A. CROSS
AND JOHN S. LENESS, AND EACH OF THEM, AS YOUR PROXIES.

John S. Leness
Secretary

KENT, WASHINGTON
July 27, 1995

It is Important That Your Stock be Voted

<PAGE> 3

PROXY STATEMENT

FLOW INTERNATIONAL CORPORATION
23500 - 64TH AVENUE SOUTH
KENT, WASHINGTON 98032

PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD AUGUST 30, 1995

The following proxy statement is made in connection with solicitation by
the Board of Directors of Flow International Corporation (the "Company") of the
enclosed proxy for use at the Annual Meeting of Stockholders.

Shares presented by properly executed proxy in the accompanying form will
be voted at the meeting and, where instructions have been given by the
stockholder, will be voted in accordance with such instructions. As stated in
the proxy, if no instructions are given, the stockholder's shares will be voted
according to the recommendations of the Board of Directors. The proxy may be
revoked at any time before its exercise by sending written notice of revocation
to the Secretary of the Company, or by signing and delivering a proxy which is
dated later, or, if the stockholder attends the meeting in person, by giving
notice of revocation to the meeting judge.

At the date of this statement, the only matters that Management intends to
present are the election of directors and the approval of the 1995 Long-Term
Incentive Plan. If any other matters are properly brought before the meeting,
the enclosed proxy gives discretionary authority to the persons named in such
proxy to vote the shares in their best judgment.

The 1995 Annual Report of the Company is enclosed herewith. The approximate
mailing date of this proxy material is July 27, 1995.

OUTSTANDING SECURITIES AND VOTING RIGHTS

The Company has only one class of capital stock outstanding entitled to be
voted at the Annual Meeting: Common Stock with voting rights. On July 17, 1995,
the record date for determining the stockholders entitled to vote at the Annual
Meeting, there were 14,373,744 shares of Common Stock outstanding and entitled
to vote.

The last sale on the record date of the Company's Common Stock, as reported
by NASDAQ, was $9.75 per share. Each share entitles the holder to one vote on
all matters presented for stockholder approval including one vote for each
director. There are no cumulative voting rights. Under Delaware law and the
Company's Certificate of Incorporation, the election of directors requires the
vote of the plurality of shares present in person or represented by proxy at the
meeting and entitled to vote. Accordingly, the indication of an abstention on a
proxy or the failure to vote either by proxy or in person will be treated as
neither a vote "for" nor "against" the election of any director. Each of the
other matters must be approved by the affirmative vote of the majority of shares
present in person or represented by proxy at the meeting and entitled to vote.
Abstention from voting will have the practical effect of voting against these
matters since it is one less vote for approval. Broker nonvotes, shares held by
brokers or nominees for the accounts of others as to which voting instructions
have not been given, will be treated as shares that are present for determining
a quorum. Brokers and nominees, under applicable law, may vote shares for which
no instructions have been given in their discretion in the election of
directors.

<PAGE> 4

PROXY STATEMENT

ELECTION OF DIRECTORS
(Proxy Proposal Number 1)

According to the Certificate of Incorporation, the Board of Directors shall
be composed of no less than five directors (except in the case of unfilled
vacancies) and no more than nine directors who, beginning with the 1984 election
of directors, were divided (as closely as possible) into three equal classes.
The By-Laws provide that the number of directors shall be nine. The Certificate
of Incorporation and the By-Laws also provide that the outside directors are to
be represented as closely as possible in equal numbers among the three classes.

At the meeting three directors will be elected to serve for three-year
terms expiring on the date of the 1998 Annual Meeting of Stockholders and one
director will be elected to serve for a one-year term expiring on the date of
the 1996 Annual Meeting of Stockholders. Of the remaining directors, two are
serving terms that will not expire until the 1996 Annual Meeting of Stockholders
and three are serving terms that will not expire until the 1997 Annual Meeting
of Stockholders. Two of the current directors are retiring. Each director
elected will continue in office until his or her successor has been elected, or
until his or her resignation or removal in the manner provided by the
Certificate of Incorporation and the By-Laws of the Company.

The names of those persons nominated by the Board of Directors for the
position of director of the Company and the names of the directors of the
Company whose terms will continue after the Annual Meeting are listed below,
accompanied by brief biographies. Shares represented by a properly executed
proxy in the accompanying form will be voted for such nominees. Discretionary
authority is reserved to vote such shares in the best judgment of the persons
named in the proxy in the event that any person or persons other than the
nominees listed below are to be voted upon at the meeting due to the
unavailability of any nominee so listed.

There are no family relationships between any nominee, director, or
executive officer of the Company.

The affirmative vote of a plurality of the votes cast by stockholders
present in person or by proxy and entitled to vote at the meeting, a quorum
being present, is required to elect the nominees listed below.

The names of the nominees for directors and the continuing directors,
together with certain information regarding them, are as follows:

NOMINEES (FOR TERMS OF THREE YEARS):

RON D. BARBARO (age 63) was President of The Prudential Insurance Company
of America, responsible for world-wide operations, and he retired in 1992. He
was responsible for Prudential's Canadian operation from 1985 to 1990. Mr.
Barbaro serves on the Boards of: The Thomson Corporation, Equifax, Inc., The
Prudential Life Insurance Company (Canada), The Prudential Insurance Company of
America Mutual Funds, Canbra Foods Limited, Clairvest Group, Inc., Addiction
Management Systems and Ronald McDonald Children's Charities.

ARLEN I. PRENTICE (age 57) is Co-Chairperson and Principal of Kibble &
Prentice, Inc., which provides insurance and financial consulting services. He
has served as a director of the Company since 1993. Mr. Prentice was elected in
1993 to a term expiring with the 1996 Annual Meeting, but he is standing for
election for a term expiring in 1998 in order to balance the distribution of
directors among the three classes. He has been Chairman or President of Kibble &
Prentice for the past twenty-three years. Mr. Prentice serves as a director of
Northland Telecommunications Corporation; Western Drug Distributors, Inc.;
Starbucks Coffee Company and Percon, Inc.

DR. J. MICHAEL RIBAUDO (age 53) is Executive Vice President of Healthsouth,
a provider of rehabilitation services, and President of its St. Louis division.
Dr. Ribaudo joined Healthsouth in January of 1995 when Outpatient Surgery
Center, a chain of free-standing ambulatory surgery centers he had founded in
1985, was merged with Healthsouth. He also serves as director of Foot
Technology, the Mary Institute and St. Louis County Day School. Dr. Ribaudo
graduated from Louisiana State University in 1963 and Louisiana State Medical
School in 1967 and has had post graduate training at Emory University,
Washington University and New York University.

NOMINEE (FOR TERM OF ONE YEAR):

JOHN S. CARGILL (age 42) is Vice Chairman of Cargill Detroit Corporation
("Cargill Detroit"). He was appointed Director following the acquisition of the
ASI Robotic Systems Division of Cargill Detroit in 1995. Mr. Cargill joined
Cargill Detroit in 1972 and was appointed Vice President

3
<PAGE> 5

PROXY STATEMENT

of Manufacturing in 1983, and Vice Chairman in 1988. He served as President of
the ASI Robotic Systems Division from 1990 to 1995. Mr. Cargill has served on
the management committees of numerous organizations, including the Board of
Directors for Henry Ford Hospital in Detroit and on the Government Relations
Board for the National Machine Tool Builders' Association. He is currently on
the Board of Directors of The National Center for Manufacturing Sciences (NCMS).

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE ABOVE NOMINEES
FOR THE BOARD OF DIRECTORS

CONTINUING DIRECTORS:

DANIEL J. EVANS (age 69) has been Chairman of Daniel J. Evans Associates, a
consulting firm in Seattle, since 1989. Mr. Evans was appointed to the Company's
Board of Directors in 1991, and his current term expires with the 1997 Annual
Meeting. From 1965 through 1977 Mr. Evans was Governor of the State of
Washington. From 1977 through 1983 he was President of The Evergreen State
College. In 1983 he was appointed to the United States Senate to fill the seat
of the late Senator Henry M. Jackson and won a special election to serve the
remaining five years of the term. He did not seek a second term. Mr. Evans
chaired the National Academy of Sciences Commission on Policy Options for Global
Warming, is co-chair of the Washington Wildlife and Recreation Coalition and
provides political analysis on KIRO Radio and Television in Seattle. Mr. Evans
serves as director of Washington Mutual Savings Bank, Burlington Northern Inc.,
Tera Computer Company, Heart Technology, Inc. and Puget Sound Power & Light Co.,
and as trustee for The Evergreen State College Foundation and Childrens Hospital
Foundation. Mr. Evans also serves on the Board of Regents of the University of
Washington. Mr. Evans received a B.S. in 1948, and an M.S. in 1949, in civil
engineering from the University of Washington.

RITA A. O'BRIEN (age 53) is President of H.O. Sports, a manufacturer of
water skis, ski boards and kneeboards. Ms. O'Brien has served as a director of
the Company since 1993. Her term expires with the 1996 Annual Meeting. Before
becoming president of H.O. Sports, Ms. O'Brien had spent twenty-five years with
the Bell System companies, concluding as Chief Executive Officer for the
telephone company serving Rhode Island. Ms. O'Brien served for ten years as a
trustee of Massachusetts Institute of Technology and for ten years as a trustee
of Whitman College. She received a B.A. from Whitman College in 1963, a Masters
of Science in Operations Research from Stanford University in 1968 and a Masters
of Science in Business from M.I.T. in 1977.

KENNETH M. ROBERTS (age 48) is President and Chief Investment Officer of
Ken Roberts Investment Management, Inc., an investment advisory firm. Mr.
Roberts is also President and Chief Executive Officer of Ken Roberts Financial
Services, Inc. Mr. Roberts was, until November 1994, President and Chief
Investment Officer of Ken Roberts Advisory Group, an investment advisory firm
and subsidiary of the Spokane, Washington, office of Smith Barney Shearson, Inc.
Mr. Roberts was appointed to the Company's Board of Directors in 1991, and his
current term expires with the 1997 Annual Meeting. From 1981 to 1991 he was Vice
President of Shearson Asset Management and Foster & Marshall Management,
investment advisors, and President of Shearson Lehman Fundamental Value Fund, a
registered investment company. From 1987 to 1991, Mr. Roberts was also a
director of Shearson Lehman Fundamental Value Fund. Mr. Roberts received a B.A.
from Whitworth College in 1968 and an M.B.A. from the Harvard Graduate School of
Business in 1971.

RONALD W. TARRANT (age 58) assumed the position of President and Chief
Executive Officer in 1991. Mr. Tarrant succeeded Mr. Andrews as Chairman
following the 1994 Annual Meeting of Stockholders. Mr. Tarrant was appointed to
the Board in 1991, and his current term expires with the 1997 Annual Meeting. He
came to the Company from Augat, Inc., a New York Stock Exchange listed company,
where, since 1987, he had been a corporate officer and Division Vice President
of the Augat Communications Division, a manufacturer of equipment for the cable
television and telecommunications industries. Mr. Tarrant was President of
Telzon, Inc., prior to Augat's purchase of Telzon in 1984, and President of the
subsidiary from 1984 to 1986. Mr. Tarrant received a B.A. from Asbury College in
1959.

<PAGE> 6

PROXY STATEMENT

DEAN D. THORNTON (age 66) retired from The Boeing Company in 1994 where he
had been executive vice president, a member of the executive council, and since
1985, President of Boeing Commercial Airplane Group. Mr. Thornton has served as
a director of the Company since 1993. His term expires with the 1996 Annual
Meeting. Mr. Thornton joined Boeing in 1963 as Assistant Treasurer and was
elected Treasurer in 1966. He served in a variety of executive assignments
including Vice President of Finance, contracts and international operations for
the commercial airplane company and Vice President - General Manager of the 767
Division. Mr. Thornton serves on the Boards of Directors of Principal Financial
Group of Des Moines, Iowa; Seattle-First National Bank and Seafirst Corporation.
He is also a member of the Board of Trustees of the Seattle Art Museum. Mr.
Thornton received a B.S. in business from the University of Idaho in 1952.

RETIRING DIRECTORS:

DR. LOUIS J. ALPINIERI (age 58) has served as a director of the Company
since 1983. Dr. Alpinieri's term expires with the 1995 Annual Meeting, and he is
retiring from the Board upon the expiration of his term. Since 1980, Dr.
Alpinieri has been the President of Vantage Associates, Inc., a company he
founded, which manufactures aerospace composite structures in San Diego,
California. He also served on the Boards of Flow Industries, Inc., the Company's
original parent, and FloWind Corporation, a wind energy company. He received a
Ph.D. in Aeronautical Engineering from the Brooklyn Polytechnic Institute in
1963.

LLOYD J. ANDREWS (age 74) has served as a director of the Company since
1983, and as Chairman from July 1991, when Dr. Y. H. (Michael) Pao resigned as
Chairman, President, Chief Executive Officer and Treasurer, until the 1994
Annual Meeting, when Mr. Tarrant became Chairman. Mr. Andrews has served as
Chairman Emeritus since the 1994 Annual Meeting, and following the 1995 Annual
Meeting, when he has announced that he plans to retire, has agreed to serve as a
nonvoting Director Emeritus. Mr. Andrews is a founder, and served from 1980 to
his retirement in 1986 as Vice Chairman of the Board of Chem-Nuclear Systems,
Inc., in Bellevue, Washington. Chem-Nuclear Systems, Inc. specializes in the
management of nuclear and chemical wastes. Mr. Andrews also serves on the boards
of North Coast Life Insurance Company and Smith Barney Shearson/Lehman
Fundamental Value Fund. He received a B.S. degree in agriculture chemistry and
soil sciences from Washington State University in 1942.

The Board of Directors held six meetings during the fiscal year ended April
30, 1995. All directors attended at least 75% of all Board and committee
meetings. The numbers of meetings of each Committee of the Board are described
below. All members of each Committee attended all meetings.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company has an Audit Committee, a Compensation and Plan Administrator
Committee, a Mergers and Acquisitions Committee and a Nominating Committee.

AUDIT COMMITTEE

The function of the Audit Committee is to monitor the effectiveness of the
audit effort and the Company's financial and accounting organization and
financial reporting and to select a firm of certified public accountants whose
duty it is to audit the books and accounts of the Company for the fiscal year
for which they are appointed. The members of the Audit Committee are Dr.
Alpinieri, Mr. Thornton and Mr. Roberts. The Audit Committee held four meetings
in the fiscal year ended April 30, 1995.

COMPENSATION AND PLAN ADMINISTRATOR COMMITTEE

The function of the Compensation and Plan Administrator Committee is to
structure the Company's executive compensation program, to set compensation
guidelines for officers and management of the Company and to review and approve
compensation for the Chairman and the Chief Executive Officer. The Committee
also acts as Administrator of the Company's stock option plans, determining the
terms, amounts and recipients of stock option grants. The members are Mr.
Prentice, Mr. Evans and Mr. Thornton. There were five meetings of the
Compensation Committee during the fiscal year ended April 30, 1995.

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<PAGE> 7

PROXY STATEMENT

MERGERS AND ACQUISITIONS COMMITTEE

The function of the Mergers and Acquisitions Committee is to review
potential opportunities for acquisitions, mergers or similar transactions. The
members of the Mergers and Acquisitions Committee are Ms. O'Brien, Mr. Tarrant
and Mr. Roberts. There were two meetings of the Mergers and Acquisitions
Committee during the fiscal year ended April 30, 1995.

NOMINATING COMMITTEE

The function of the Nominating Committee is to recommend to the Board
individuals to fill Board vacancies and to consider issues of Board composition
and organization. Mr. Andrews, Mr. Evans and Mr. Prentice serve on the
Nominating Committee. The Nominating Committee met once during the fiscal year
ended April 30, 1995.

The Company pays directors who are not employees of the Company an annual
retainer of $6,000, $1,000 for each Board and Committee meeting attended in
person or $500 for each Committee or telephonic meeting, up to a maximum of one
Board and one Committee fee per day, and $600 per day or $300 per half-day or
part thereof, for time spent on business of the Company at the request of the
Chairman of the Board of Directors, and reimburses them for related
out-of-pocket travel and other expenses. Committee chairmen are paid $750 per
Committee meeting in lieu of the regular $500 fee. Directors also receive grants
of options under the 1987 Stock Option Plan for Nonemployee Directors. The
Company has adopted a retirement policy providing that directors will receive,
following their retirement, annual amounts equal to the annual retainer paid to
them at the time of retirement, for a period equal to the director's years of
service on the Board, up to a maximum of nine years. The Company also pays Mr.
Andrews, following his retirement as Chairman, an annual sum of $20,000, for a
period equal to Mr. Andrews' years of service as a director.

MANAGEMENT

EXECUTIVE OFFICERS
THE EXECUTIVE OFFICERS OF THE COMPANY ARE:

<TABLE>
<CAPTION>
NAME AGE POSITION
- --------------------------------------------------------------------------------------
<S> <C> <C>
Lee M. Andrews 43 Vice President and Chief Financial Officer
Janice L. Cannon 47 Vice President of Human Resources
Thomas A. Cross 37 Executive Vice President and Chief Operating Officer
William A. Keadle 49 Senior Vice President of Sales
John S. Leness 35 General Counsel and Secretary
Thomas J. Stefanik 53 Senior Vice President of Product Marketing & Engineering
Ronald W. Tarrant 58 Chairman, President and Chief Executive Officer
Edmund Y. Ting 41 Vice President of Research and Technology
</TABLE>

Each executive officer of the Company is elected or appointed annually by the
Board of Directors.

LEE M. ANDREWS joined the Company in July 1994 as Vice President and Chief
Financial Officer. Mr. Andrews is a chartered accountant (United Kingdom),
having worked for Coopers & Lybrand internationally from 1973 to 1986, with
assignments in the United Kingdom, South Africa and New York. Mr. Andrews was
Assistant Controller of NL Industries, Inc. from 1986 to 1987 and Treasurer of
Vernitron Corporation from 1987 to 1991. From 1991 until he joined the Company
Mr. Andrews consulted to law firms on financial management issues.

JANICE L. CANNON joined the Company in August of 1994 as Vice President of
Human Resources. Ms. Cannon headed a human resources consulting firm from 1990
to 1994, serving clients that included Microsoft Corporation, Intel Corporation,
Immunex Corporation and Cell Therapeutics. Ms. Cannon served as Director of
Operations for the Arizona Asthma and Allergy Institute, in Phoenix, Arizona,
from 1986 to 1990.

<PAGE> 8

PROXY STATEMENT

THOMAS A. CROSS joined the Company in June 1991 as Vice President of
Finance, Chief Financial Officer and Treasurer and became Chief Operating
Officer in January 1993. He had been Group Finance Director of Augat
Communications Group, a manufacturer of equipment for the cable television and
telecommunications industries and a wholly-owned subsidiary of Augat, Inc., a
New York Stock Exchange listed company, since 1986. Mr. Cross was Finance
Director of CIGNA Healthplan of Washington, a health maintenance organization,
in 1985-1986, and was Controller of Telzon Inc., the predecessor of Augat
Communications Group, from 1981 to 1985.

WILLIAM A. KEADLE joined the Company in February 1993 as Senior Vice
President, construction Products and Services. Mr. Keadle had been Vice
President, Sales and Marketing for Icom America, a manufacturer of electronics
products, since February of 1991. From 1981 to 1991, Mr. Keadle was with Bank
and Office Interiors, a capital equipment provider of specialty interiors, and
was President for the last five years.

JOHN S. LENESS joined the Company in June 1990 as its Corporate Counsel,
became General Counsel in December 1990, was appointed Assistant Secretary in
January 1991 and Secretary in February 1991. Prior to joining the Company, Mr.
Leness had been associated since 1986 with the Perkins Coie law firm.

THOMAS J. STEFANIK joined the Company in November of 1983 as eastern
regional sales manager. He became national sales manager in 1990 and Vice
President, Sales in 1992. Mr. Stefanik moved to the Company's headquarters and
became Senior Vice President, Product Marketing and Engineering in the fall of
1993. Before joining the Company Mr. Stefanik had been with United States Robots
and ASEA, Inc., manufacturers of factory automation equipment and robotics.

RONALD W. TARRANT (Biographical information for Mr. Tarrant appears above).

EDMUND Y. TING joined the Company in June 1990 as Director of Technology
and was appointed Vice President of Technology and Engineering on July 15, 1991,
and became Vice President of Research and Technology in May of 1992. Dr. Ting
joined Grumman Corporation in 1984 and, prior to leaving to join the Company,
headed the Structural Materials Laboratory.

STOCK OWNERSHIP OF MANAGEMENT AND OF PRINCIPAL STOCKHOLDERS

The following table sets forth information as of July 17, 1995, with
respect to each stockholder known by the Company to be the beneficial owner of
more than five percent (5%) of any class of voting securities of the Company,
each director, those executive officers listed in the Summary Compensation Table
below and all directors and executive officers of the Company as a group.
Currently, the Company's sole class of voting securities outstanding is Common
Stock. Except as noted below, each person has sole voting and investment powers
with respect to the shares shown. The address for each of the persons listed
below, is 23500 64th Avenue South, Kent, Washington 98032.

<TABLE>
<CAPTION>
NAME AND POSITION NUMBER OF SHARES PERCENT OF OUTSTANDING SHARES
- --------------------------------------------------------------------------------------------------------
<S> <C> <C>
Dr. Louis J. Alpinieri, Director 133,266(1) 1.0%
Mr. Lloyd J. Andrews, Director 92,595(2) *
Mr. Daniel J. Evans, Director 55,000(3) *
Mr. John S. Cargill, Director 3,500(4) *
Ms. Rita A. O'Brien, Director 14,500(5) *
Mr. Arlen I. Prentice, Director 57,579(5) *
Mr. Kenneth M. Roberts, Director 73,000(3) *
Mr. Ronald W. Tarrant, Director 295,118(6) 2.1%
Mr. Dean D. Thornton, Director 16,000(7) *
Mr. Thomas A. Cross, Executive Officer 111,377(8) *
Mr. William A. Keadle, Executive Officer 18,993(9) *
Mr. Thomas J. Stefanik, Executive Officer 35,028(10) *
</TABLE>

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<PAGE> 9

PROXY STATEMENT

<TABLE>
<CAPTION>
NAME AND POSITION NUMBER OF SHARES PERCENT OF OUTSTANDING SHARES
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Dr. Edmund Y. Ting, Executive Officer 35,734(11) *
All directors and officers -- as a group (16 persons) 1,016,536(12) 7.07%
- ----------------
</TABLE>

* Less than 1% beneficial ownership of Company Common Stock.

(1) Includes options exercisable within 60 days for 60,000 shares of Company
Common Stock.

(2) Includes options exercisable within 60 days for 80,000 shares of Company
Common Stock.

(3) Includes options exercisable within 60 days for 31,000 shares of Company
Common Stock.

(4) Does not include 445,000 shares owned by Cargill Detroit Corporation.

(5) Includes options exercisable within 60 days for 14,000 shares of Company
Common Stock.

(6) Includes options exercisable within 60 days for 280,000 shares of Company
Common Stock.

(7) Includes options exercisable within 60 days for 6,000 shares of Company
Common Stock.

(8) Includes options exercisable within 60 days for 91,250 shares of Company
Common Stock.

(9) Includes options exercisable within 60 days for 18,750 shares of Company
Common Stock.

(10) Includes options exercisable within 60 days for 22,750 shares of Company
Common Stock.

(11) Includes options exercisable within 60 days for 33,750 shares of Company
Common Stock.

(12) Includes options exercisable within 60 days for 750,500 shares of Company
Common Stock.

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than 10% of a
registered class of the Company's equity securities, to file with the Securities
and Exchange Commission initial reports of ownership and reports of changes in
ownership of Common Stock. Officers, directors and greater-than-ten percent
shareholders are required by SEC regulations to furnish the Company with copies
of all Section 16(a) forms they file. To the Company's knowledge, based solely
on review of the copies of such reports furnished to the Company and
representations that no other reports were required, during the fiscal year
ended April 30, 1995, all Section 16(a) filing requirements were complied with.

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table sets forth information for the years ended April 30,
1995, 1994 and 1993, with respect to the Chief Executive Officer and each of the
four other highest paid executive officers of the Company whose aggregate cash
compensation in fiscal 1995 exceeded $100,000.

<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION ------------
NAME AND PRINCIPAL ------------------------ NUMBER OF ALL OTHER
POSITION YEAR SALARY BONUS STOCK OPTIONS COMPENSATION*
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Ronald W. Tarrant 1995 $285,582 $140,300 10,000 $12,022
Chairman, President and 1994 241,508 16,301 75,000 15,803
Chief Executive Officer 1993 233,468 80,500 95,000 44,639(1)
Thomas A. Cross 1995 $170,302 $ 84,790 0 $10,335
Executive Vice President 1994 143,853 9,710 45,000 11,622
and Chief Operating 1993 116,662 42,145 20,000 6,030
Officer
Thomas J. Stefanik 1995 $120,856 $ 50,268 0 $ 8,680
Senior Vice President 1994 99,242 35,998(2) 17,500 9,226
of Product Marketing 1993 63,252 82,514(2) 1,500 4,246
& Engineering
William A. Keadle 1995 $144,019 $ 55,236 0 $ 8,265
Senior Vice President 1994 137,010 9,248 12,500 6,596
of Sales 1993 36,887 5,138 10,000 1,500
</TABLE>

8
<PAGE> 10
PROXY STATEMENT

LONG TERM
COMPENSATION
ANNUAL COMPENSATION -------------
NAME AND PRINCIPAL ------------------------ NUMBER OF ALL OTHER
POSITION YEAR SALARY BONUS STOCK OPTIONS COMPENSATION*
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Edmund Y. Ting 1995 $100,006 $46,500 0 $ 3,717
Vice President of 1994 91,166 6,153 12,500 3,306
Technology and 1993 92,211 18,520 0 3,158
Engineering
</TABLE>
- -------------------------
* Includes company contributions to the 401(k) Plan.
(1) Includes amounts paid to Mr. Tarrant in connection with credit provided
for the purchase of Company stock and other matters at the time of Mr.
Tarrant's employment by the Company.
(2) Includes amounts paid as commissions in prior position.

OPTION GRANTS TABLE

FISCAL 1995

The following table sets forth certain information regarding options
granted to the Company's chief executive officer and each of the individuals
named in the Summary Compensation table during the fiscal year ended April 30,
1995.

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
--------------------------------------------------- --------------------------------
PERCENT OF VALUE AT ASSUMED ANNUAL RATES OF
TOTAL OPTIONS STOCK PRICE
NUMBER GRANTED TO EXERCISE APPRECIATION FOR OPTION
OF OPTIONS EMPLOYEES IN PRICE EXPIRATION TERM (10 YEARS)
NAME GRANTED FISCAL YEAR ($/SHARE) DATE 5% 10%
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
All FLOW Stockholders* $193,270,942 $307,751,675
Ronald W. Tarrant 5,000 3.92% $7.00 08/31/04(1) 22,050 55,650
5,000 3.92% $6.50 12/20/04(1) 20,475 51,675
Thomas A. Cross 0 -- -- -- -- --
William Keadle 0 -- -- -- -- --
Thomas J. Stefanik 0 -- -- -- -- --
Edmund Y. Ting 0 -- -- -- -- --
</TABLE>
- -------------------------
* Based on a total value of the Company's outstanding common stock at
April 30, 1995, 1995, of $118,651,593 million.

(1) The options vest 50% annually.

AGGREGATED OPTION EXERCISES IN FISCAL 1995 AND FISCAL YEAR-END OPTION VALUES

The following table sets forth certain information regarding options
exercised during the year ended April 30, 1995, by the Company's Chief Executive
Officer and each of the individuals named in the Summary Compensation Table.

<TABLE>
<CAPTION>
TOTAL NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS
SHARES FISCAL YEAR-END AT FISCAL YEAR-END(1)
ACQUIRED ON VALUE -------------------------- ---------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Ronald W. Tarrant 0 -- 280,000 25,000 $1,030,000 $58,125
Thomas A. Cross 0 -- 101,250 13,750 $ 322,188 $34,375
William A. Keadle 0 -- 18,750 3,750 $ 38,750 $ 9,375
Thomas J. Stefanik 0 -- 24,625 3,750 $ 88,203 $ 9,375
Edmund Y. Ting 0 -- 31,750 5,750 $ 157,125 $ 9,375
</TABLE>
- -------------------------
(1) Calculated using $8.125, the closing price of the Company's common stock
as reported by NASDAQ on April 30, 1995.

9
<PAGE> 11

PROXY STATEMENT

COMPENSATION COMMITTEE REPORT

The Compensation and Plan Administrator Committee has adopted the following
philosophy statement:

Flow International believes that the purpose of compensation is to attract,
motivate, and retain excellently performing employees throughout the
company. Furthermore, Flow also believes that pay programs, especially
those for top executives, should be designed in a manner that aligns
employee interests with those of the stockholders. In view of these two
beliefs, executive compensation programs at Flow International will be
designed to meet the following objectives:

- Base salaries will be targeted at the 75th percentile of competitive
practice.

- Bonus or incentive compensation will be based on individual, unit, and/or
total company performance. At least 50% of executive bonuses will be tied
directly to overall company results.

- Stock options will be granted, as appropriate, by the Board in accordance
with the current stock compensation plan.

- To more closely align executive interests with those of the stockholders,
executives will be required to achieve established stock ownership goals
in accordance with the Stock Ownership Plan.

The administration of the compensation programs will be directed toward
ensuring that the executives are paid fairly and competitively while
maintaining a strong relationship between the overall performance of Flow
International and the level of compensation.

In order to implement this philosophy, the Committee has implemented an
executive compensation program with the following elements:

BASE SALARY

Consistent with the Committee's philosophy, base salaries for fiscal 1996
have been set based on comparisons to salary levels at comparable companies with
the goal of setting levels at the seventy-fifth percentile. In its review, the
Committee relied on data compiled by the Company's Human Resources group for
each Company executive and on data compiled by Milliman & Robertson, Inc., an
outside consultant, retained by the Committee for the President and Chief
Executive Officer. Salary adjustments for individual executives were made to
bring compensation levels into line with such comparable companies. The
Committee's decisions are presented to and are subject to final approval by the
Board of Directors.

BONUS PROGRAM

The Committee believes that shareholder return in the short term will be
maximized by ensuring that the Company achieves good operating results. The
Committee has structured the Company's executive bonus program so that annual
bonuses are payable based on achievement of target levels for operating income
and return on managed assets (or cash, inventories and accounts receivable),
which the Committee believes are the best measures of the Company's financial
performance. Bonuses are also payable based on achievement of individual goals,
set by an executive's supervisor or, in the case of the President and Chairman,
the Committee.

STOCK OPTIONS

In order to provide management with incentives to maximize long-term
shareholder returns, the Committee, as administrator of the Company's stock
option plans, grants stock options to management. The Committee believes that
such grants will encourage management to pursue long-term strategies that will
increase the price of the Company's shares. The grants are made at prevailing
market prices at the time of grant and are generally subject to a two-year
vesting schedule. The options will only have value if the value of the Company's
stock increases, and an executive will only be able to benefit from the options
if he or she remains with the Company. The grants are generally made annually at
the time of the Committee's annual review of executive compensation. For fiscal
1996, the Committee evaluated each executive's holdings of options to ensure
that the levels were consistent with the overall compensation package and with
such executive's performance and stock ownership goals (described below) before
making annual grants.

STOCK OWNERSHIP

Because the Committee believes that executives who share the same risks as
the Company's stock-

10
<PAGE> 12

PROXY STATEMENT

holders will be more likely to manage the Company to maximize stockholder value,
the Committee implemented in fiscal 1994, for the Company's most senior
officers, a plan requiring stock ownership by each officer. The plan requires
that executives acquire and maintain minimum holdings of the Company's stock.
The Committee intends that the plan encourage executives to hold at least five
percent of the Company's outstanding common stock. Stock ownership goals have
been established for each executive officer based on individual responsibilities
and salary level and range from 150,000 shares to 45,000 shares. Executives are
given five years to reach their goals. The Committee will reduce future stock
option awards to those executives who fail to meet their ownership goals.

The Committee specifically reviews the performance of the Chairman,
President and Chief Executive Officer in the course of its review of the
Company's executive compensation program. The Committee's evaluation of the
compensation for the President, Chairman and Chief Executive Officer is based
not only on the Company's financial performance during the fiscal year, but also
on achievement of long-term strategic goals. During the course of the year the
Committee monitors the Company's performance and meets both with and without
management to evaluate the Company's results. For fiscal 1996, the Committee's
adjustment to the President's base compensation was based on data provided by
Milliman & Robertson, Inc., and was intended to bring it into line with
compensation paid to chief executive officers of comparable companies.

In August of 1993 the Internal Revenue Code was amended to impose a
limitation on the deductibility of nonperformance based annual executive
compensation in excess of $1.0 million. The Compensation Committee presently
anticipates that the Company's executive compensation will either be below such
levels or will be structured to qualify as "performance based compensation"
which is exempt from such limitation.

This report is submitted by the members of the Compensation and Plan
Administrator Committee. This report shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, and shall not be deemed filed under
such acts.

Compensation and Plan
Administrator Committee
Arlen I. Prentice - Chairman
Daniel J. Evans
Dean D. Thornton

COMPENSATION COMMITTEE MEMBERSHIP

The Compensation and Plan Administration Committee is composed of
independent outside directors, none of whom serve on boards of companies whose
boards include Company executives.

11
<PAGE> 13

PROXY STATEMENT

STOCK PERFORMANCE GRAPH

The following graph sets forth the cumulative total stockholder return
(assuming reinvestment of dividends) to the Company's stockholders during the
five-year period ending April 30, 1995, as well as overall stock market index
(NASDAQ) and for those peer group indices selected for each of the Company's
product lines (S & P Machine Tools, Dow Jones Factory Equipment and Dow Jones
Heavy Construction). The Company has paid no dividends on its common stock.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG FLOW INTERNATIONAL CORPORATION...
FISCAL YEAR ENDING APRIL 30

<TABLE>
<CAPTION>
4/90 4/91 4/92 4/93 4/94 4/95
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
FLOW INTERNATIONAL CORPORATION 100 73 129 165 148 216
NASDAQ STOCK MRKT - US 100 119 144 166 184 214
S & P MACHINE TOOLS 100 66 106 112 108 106
D J FACTORY EQUIPMENT 100 96 124 134 138 136
D J HEAVY CONSTRUCTION 100 114 107 102 133 123
</TABLE>

* $100 INVESTED ON 04/30/90 IN STOCK OR INDEX--INCLUDING REINVESTMENT OF
DIVIDENDS, FISCAL YEAR ENDING APRIL 30.

APPROVAL OF THE 1995 LONG-TERM INCENTIVE PLAN
(Proxy Proposal Number 2)

The 1995 Long-Term Incentive Plan (the "1995 Plan") was adopted by the
Company's Board of Directors on June 6, 1995, subject to approval by the
Company's stockholders at the Annual Meeting. The 1995 Plan is the successor to
the Company's existing 1991 Stock Option Plan (the "1991 Plan") and the 1984
Restated Stock Option Plan (the "1984 Plan"). Upon approval by the stockholders,
the 1995 Plan will supersede the 1991 Plan and the 1984 Plan and no further
grants will be made under the 1991 Plan or the 1984 Plan. A copy of the 1995
Plan is attached to this Proxy Statement as Exhibit A. The following description
of the 1995 Plan is a summary and does not purport to be fully descriptive.
Reference is made to Exhibit A for more detailed information.

INTRODUCTION

Although the 1995 Plan includes provisions for the same kinds of option
awards that could have been made under the 1991 Plan or the 1984 Plan, the 1995
Plan gives the Company greater flexibility. Like the 1991 Plan and the 1984
Plan, the purpose of the 1995 Plan is to enhance the long-term profitability and
stockholder value of the Company by offering incentives and rewards to those
employees, consultants, advisors, and agents of the Company and its subsidiaries
who are key to the Company's growth and success, and to encourage them to remain
in the service of the Company and its subsidiaries and to acquire and maintain
stock ownership in the Company. The following are certain of the more
significant differences between the 1995 Plan and the 1991 Plan:

(1) The 1995 Plan provides for the grant of stock appreciation rights,
stock awards (including restricted stock), other stock-based awards and
dividend equivalent rights, in addition to the incentive stock options
and the nonqualified stock options authorized under the 1991 Plan and
the 1984 Plan.

12
<PAGE> 14

PROXY STATEMENT

(2) The 1995 Plan extends the exercise period of stock options after the
recipient's employment or services are terminated by the Company due to
the recipient's retirement, early retirement at the Company's request,
disability or death.

(3) The 1995 Plan permits the plan administrator to authorize loans, loan
guarantees or installment payments to assist recipients in acquiring
shares pursuant to awards and contains certain limitations imposed by
recent tax limitations.

AWARDS

The 1995 Plan provides for grants of stock options, stock appreciation
rights, stock awards (including restricted stock), other stock-based awards and
dividend equivalent rights. Awards may be made singly, in combination or in
tandem so that the settlement or payment of one automatically reduces or cancels
the other. Awards may also be made in combination or in tandem with, in
replacement of, as alternatives to, or as the payment form for, grants or rights
under any other employee or compensation plan of the Company or in substitution
for, or by the assumption of, awards issued under plans of an acquired entity.

STOCK SUBJECT TO THE 1995 PLAN

Subject to adjustment from time to time as provided in the 1995 Plan, a
maximum of 750,000 shares of Common Stock will be available for issuance under
the 1995 Plan, except that any shares remaining available for issuance under the
1991 Plan or the 1984 Plan on the date the Company's stockholders approve the
1995 Plan, or that become available for issuance in accordance with the terms of
the 1991 Plan or the 1984 Plan as in effect on such date, will be added to the
number of shares available for issuance under the 1995 Plan. As of July 17,
1995, 1,022,700 shares were subject to outstanding option awards and 71,825
shares were available for the grant of new awards, under the 1991 Plan and the
1984 Plan. As of July 1, 1995, 284,000 stock option awards had been granted
under the 1995 Plan, including 25,000 shares each to Messrs. Tarrant, Cross and
Keadle and 10,000 shares each to Messrs. Ting and Stefanik, subject to the
approval of the stockholders of the 1995 Plan. No more than 250,000 shares may
be issued as stock awards (including restricted stock) or other stock-based
awards under the 1995 Plan. Shares issued pursuant to the 1995 Plan will be
drawn from authorized and unissued shares or shares now held or subsequently
acquired by the Company.

Subject to adjustment from time to time as provided in the 1995 Plan, not
more than 250,000 shares of Common Stock may be subject to grants of options or
stock appreciation rights under the 1995 Plan to any participant in any one
fiscal year of the Company, to the extent required for compliance with certain
exemptive provisions of Section 162(m) of the Code, which precludes the Company
from taking a tax deduction for compensation payments to executives in excess of
$1 million, unless such payments qualify for the "performance-based" exemption
from the $1 million limitation.

Any shares of Common Stock that have been made subject to an award that
cease to be subject to the award (other than by reason of exercise or payment of
the award to the extent it is exercised for or settled in shares), including,
without limitation, in connection with the cancellation of an award and the
grant of a replacement award, will be available for issuance in connection with
future grants of awards under the 1995 Plan.

ELIGIBILITY TO RECEIVE AWARDS

Awards may be granted under the 1995 Plan to those officers and key
employees (including directors who are also employees) of the Company and its
subsidiaries as the plan administrator from time to time selects. Awards may
also be made to consultants, advisors and agents who provide services to the
Company and its subsidiaries.

TERMS AND CONDITIONS OF STOCK OPTION GRANTS

Options granted under the 1995 Plan may be "incentive stock options" (as
defined in Section 422 of the Code) or "nonqualified stock options." The option
price for each option granted under the 1995 Stock Option Plan will be
determined by the plan administrator, but will not be less than 100% of the
Common Stock's fair market value on the date of grant with respect to incentive
stock options. For purposes of the 1995 Stock Option Plan, "fair market value"
means the closing price of the Common Stock as reported by Nasdaq National
Market for a single trading day.

13
<PAGE> 15
PROXY STATEMENT

The exercise price for shares purchased upon exercise of options must be
paid in cash, except that the plan administrator may authorize payment in cash
and/or already owned Common Stock, a promissory note, delivery of a properly
executed exercise notice, together with irrevocable instructions to a broker, or
such other consideration as the plan administrator may specify. The optionee
must pay to the Company applicable withholding taxes upon exercise of the option
as a condition to receiving the stock certificates. The withholding tax may be
paid in cash or by the withholding or delivery of Company Common Stock.

The option term will be fixed by the plan administrator and, if not so
fixed, will be ten years. Each option will be exercisable pursuant to a vesting
schedule determined by the plan administrator. If not so determined, each option
will be exercisable in two equal annual installments beginning one year after
the date of grant. The plan administrator will also determine the circumstances
under which an option will be exercisable in the event the optionee ceases to
provide services to the Company or one of its subsidiaries. If not so
established, options generally will be exercisable for three years after
termination of services as a result of retirement, early retirement at the
Company's request, disability or death and for three months after all other
terminations. An option will not be exercisable if the optionee's services are
terminated for cause, as defined in the 1995 Plan.

STOCK APPRECIATION RIGHTS

A stock appreciation right gives its holder the right to receive an
appreciation distribution from the Company equal to the difference between the
value of the Common Stock subject to the right at the time of exercise and the
exercise price of the right. For stock appreciation rights granted in tandem
with options, the exercise price will be the same as the option exercise price.
For other stock appreciation rights, the exercise price will be as determined by
the plan administrator. The appreciation distribution will be paid in shares of
Common Stock or cash or any combination of shares and cash, as the plan
administrator may determine. Unless otherwise provided by the plan
administrator, the provisions of the 1995 Plan regarding exercisability of
options after the termination of a holder's services shall apply equally, to the
extent applicable, to stock appreciation rights.

STOCK AWARDS

The plan administrator is authorized to make awards of Common Stock to
participants on such terms and conditions and subject to such restrictions, if
any (whether based on performance standards, periods of services or otherwise),
as the plan administrator may determine. Restrictions may include repurchase or
forfeiture rights in favor of the Company.

OTHER STOCK-BASED AWARDS

The plan administrator may grant other stock-based awards under the 1995
Stock Option Plan pursuant to which shares of Common Stock are or may in the
future be acquired, or awards denominated in stock units, including awards
valued using measures other than market value. Such other stock-based awards may
be granted alone or in addition to or in tandem with any award of any type
granted under the 1995 Plan and must be consistent with the 1995 Plan's purpose.

DIVIDEND EQUIVALENT RIGHTS

Any awards under the 1995 Plan may, in the plan administrator's discretion,
earn dividend equivalent rights that entitle the holder to be credited with an
amount equal to the cash or stock dividends or other distributions that would
have been paid on the shares of Common Stock covered by such award had such
covered shares been issued and outstanding on such dividend record date. The
plan administrator may establish such rules and procedures governing the
crediting of dividend equivalent rights, including the timing, form of payment
and payment contingencies, as it deems are appropriate or necessary.

LOANS, LOAN GUARANTEES AND INSTALLMENT PAYMENTS

To assist a holder (including a holder who is an officer or director of the
Company) in acquiring shares of Common Stock pursuant to an award granted under
the 1995 Plan, the plan administrator may authorize (a) the extension of a loan
to the holder by the Company, (b) the payment by the holder of the purchase
price, if any, of the Common Stock in installments, or (c) the guarantee by the
Company of a loan obtained by the grantee from a third party. The terms of any
loans, installment

14
<PAGE> 16
PROXY STATEMENT

payments or guarantees, including the interest rate and terms of repayment, will
be subject to the plan administrator's discretion, and may be granted with or
without security.

TRANSFERABILITY

No option, stock appreciation right, other stock-based award or dividend
equivalent right will be assignable or otherwise transferable by the holder
other than by will or the laws of descent and distribution and, during the
holder's lifetime, may be exercised only by the holder, except, in the plan
administrator's sole discretion, to the extent permitted by Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or Section 422
of the Code.

ADJUSTMENT OF SHARES

In the event of any changes in the outstanding stock of the Company by
reason of stock dividends, stock splits, spin-offs, combinations or exchanges of
shares, recapitalizations, mergers, consolidations, distributions to
stockholders other than a normal cash dividend, or other changes in the
Company's corporate or capital structure, the plan administrator, in its sole
discretion, shall make any equitable adjustments as it deems appropriate in (a)
the maximum number of and class of securities subject to the 1995 Plan, (b) the
maximum number and class of securities that may be made subject to awards to any
participant, and (c) the number and class of securities that are subject to any
outstanding award and the per share price of such securities, without any change
in the aggregate price to be paid therefor.

CORPORATE TRANSACTION

In the event of certain mergers or consolidations or a sale of
substantially all the assets or a liquidation of the Company, each option, stock
appreciation right or restricted stock award that is at the time outstanding
will automatically accelerate so that each such award shall, immediately prior
to such corporate transaction, become 100% vested, except that such acceleration
will not occur if in the opinion of the Company's accountants it would render
unavailable "pooling of interest" accounting for a transaction that would
otherwise qualify for such accounting treatment. The successor corporation or
its parent corporation may elect to convert all such options or awards into
comparable rights to purchase shares of the capital stock of the successor
corporation or its parent corporation.

FURTHER ADJUSTMENT OF AWARDS

The plan administrator shall have the discretion, exercisable at any time
before a sale, merger, consolidation, reorganization, liquidation or change in
control of the Company, as defined by the plan administrator, to take such
further action as it determines to be necessary or advisable, and fair and
equitable to holders, with respect to awards. Such authorized action may include
(but is not limited to) establishing, amending or waiving the type, terms,
conditions or duration of, or restrictions on, awards so as to provide for
earlier, later, extended or additional time for exercise, payment or settlement
or lifting restrictions, differing methods for calculating payments or
settlements, alternate forms and amounts of payments and settlements and other
modifications, and the plan administrator may take such actions with respect to
all holders, to certain categories of holders or only to individual holders. The
plan administrator may take such actions before or after granting awards to
which the action relates and before or after any public announcement with
respect to such sale, merger, consolidation, reorganization, liquidation or
change in control that is the reason for such action.

ADMINISTRATION

The 1995 Plan will be administered by a committee or committees appointed
by, and consisting of one or more members of, the Company's Board of Directors.
The Board may delegate the responsibility for administering the 1995 Plan with
respect to designated classes of eligible participants to different committees,
subject to such limitations as the Board deems appropriate. Committee members
will serve for such term as the Board may determine, subject to removal by the
Board at any time. The composition of any committee responsible for
administering the 1995 Plan with respect to officers and directors of the
Company who are subject to Section 16 of the Exchange Act with respect to
securities of the Company will comply with the requirements of Rule 16b-3
promulgated under Section 16(b) of the Exchange Act, or any successor provision.

15
<PAGE> 17
PROXY STATEMENT

AMENDMENT AND TERMINATION

The 1995 Plan may be terminated, modified or amended by the stockholders of
the Company. The Company's Board of Directors may also terminate the 1995 Plan,
or modify or amend it, subject to stockholder approval in certain instances, as
set forth in the 1995 Plan. No incentive stock options may be granted under the
1995 Stock Option Plan 10 years after the date the 1995 Plan is adopted by the
Board.

FEDERAL INCOME TAX CONSEQUENCES

The federal income tax consequences to the Company and to any person
granted an award of options or stock appreciation rights under the 1995 Plan
under the existing applicable provisions of the Code and the regulations
thereunder are substantially as follows. Under present law and regulations, no
income will be recognized by a participant upon the grant of stock options or
stock appreciation rights.

On the exercise of a nonqualified stock option, the optionee will recognize
taxable ordinary income in an amount equal to the excess of the fair market
value of the shares acquired over the option price. Upon a later sale of those
shares, the optionee will have short-term or long-term capital gain or loss, as
the case may be, in an amount equal to the difference between the amount
realized on such sale and the tax basis of the shares sold. If payment of the
option price is made entirely in cash, the tax basis of the shares will be equal
to their fair market value on the exercise date (but not less than the option
price), and the shares' holding period will begin on the day after the exercise
date.

If the optionee uses already-owned shares to exercise an option in whole or
in part, the transaction will not be considered to be a taxable disposition of
the already-owned shares. The optionee's tax basis and holding period of the
already-owned shares will be carried over to the equivalent number of shares
received upon exercise. The tax basis of the additional shares received upon
exercise will be the fair market value of the shares on the exercise date (but
not less than the amount of cash, if any, used in payment), and the holding
period for such additional shares will begin on the day after the exercise date.

The same rules apply to an incentive stock option that is exercised more
than three months after the optionee's termination of employment (or more than
12 months thereafter in the case of permanent and total disability, as defined
in the Code).

Upon the exercise of an incentive stock option during employment or within
three months after the optionee's termination of employment (12 months in the
case of permanent and total disability, as defined in the Code), for regular tax
purposes the optionee will recognize no income at the time of exercise (although
the optionee will have income for alternative minimum income tax purposes at
that time as if the option were a nonqualified stock option) and no deduction
will be allowed to the Company for federal income tax purposes in connection
with the grant or exercise of the option. If the acquired shares are sold or
exchanged after the later of (a) one year from the date of exercise of the
option and (b) two years from the date of grant of the option, the difference
between the amount realized by the optionee on that sale or exchange and the
option price will be taxed to the optionee as a long-term capital gain or loss.
If the shares are disposed of before such holding period requirements are
satisfied, then the optionee will recognize taxable ordinary income in the year
of disposition in an amount equal to the excess, on the date of exercise of the
option, of the fair market value of the shares received over the option price
paid (or generally, if less, the excess of the amount realized on the sale of
the shares over the option price), and the optionee will have capital gain or
loss, long-term or short-term, as the case may be, in an amount equal to the
difference between (i) the amount realized by the optionee upon that disposition
of the shares, and (ii) the option price paid by the optionee increased by the
amount of ordinary income, if any, so recognized by the optionee.

Upon payment to a participant in settlement of a stock option or pursuant
to the exercise of stock appreciation rights or pursuant to another stock-based
award or a performance award, the participant will recognize taxable ordinary
income in an amount equal to the cash and the fair market value of the Common
Stock received.

Special rules apply to a director or officer subject to liability under
Section 16(b) of the Exchange Act.

In all the foregoing cases the Company will be entitled to a deduction at
the same time and in the same amount as the participant recognizes ordinary

16
<PAGE> 18
PROXY STATEMENT

income, subject to the following limitations. Under Section 162(m) of the Code,
certain compensation payments in excess of $1 million are subject to a
limitation on deductibility for the Company. The limitation on deductibility
applies with respect to that portion of a compensation payment for a taxable
year in excess of $1 million to either the Company's Chief Executive Officer or
any one of the other four most highly compensated executive officers. Certain
performance-based compensation is not subject to the limitation on
deductibility. Options and stock appreciation rights can qualify for this
performance-based exception, but only if they are granted at fair market value,
the total number of shares that can be granted to an executive for any period is
stated, and stockholder and Board approval is obtained. Restricted stock does
not satisfy the definition of performance-based compensation unless the lapse of
the restriction period is based on the attainment of specified performance goals
approved by the issuer's stockholders. Restricted stock grants under the 1995
Plan will not satisfy the performance-based criteria. The option and stock
appreciation right portions of the 1995 Plan have been drafted to allow
compliance with those performance-based criteria.

VOTE REQUIRED AND BOARD RECOMMENDATION

The affirmative vote of holders of a majority of the shares of common stock
represented in person or by Proxy and entitled to vote at the Annual Meeting is
required to approve the 1995 Plan. If the 1995 Plan is not approved by the
stockholders, the 1991 Plan and the 1984 Plan, as previously approved, will
continue in effect.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
APPROVAL OF THE 1995 PLAN.

17
<PAGE> 19
PROXY STATEMENT

INDEPENDENT ACCOUNTANTS

The firm of Price Waterhouse has examined the financial statements of the
Company since 1981. It is anticipated that representatives of Price Waterhouse
will be present at the Annual Meeting to answer stockholders' questions and will
have the opportunity to make a statement if they so desire.

FORM 10-K AND FINANCIAL STATEMENTS

The Company's 1995 Annual Report has been mailed to you with this Proxy
Statement. The Annual Report contains the Consolidated Financial Statements of
the Company and its subsidiaries and accompanying notes as of April 30, 1995 and
1994 and the Report thereon by Price Waterhouse.

If any stockholder entitled to vote at this Annual Meeting wishes to
receive a copy of the Company's Annual Report or Form 10-K, the Company will
furnish that person, without charge, copies upon written request. Requests
should be addressed:

John S. Leness, Secretary
Flow International Corporation
23500 64th Avenue South
Kent, Washington 98032

STOCKHOLDER PROPOSALS

To be considered for presentation to the 1996 Annual Meeting of
Stockholders, a stockholder proposal must be received at the offices of the
Company, 23500 64th Avenue South, Kent, Washington 98032, not later than March
29, 1996.

SOLICITATION AND EXPENSES OF SOLICITATION

Proxies may be solicited by officers, directors and regular supervisory and
executive employees of the Company, none of whom will receive any additional
compensation for their services. Proxies may be solicited personally or by mail,
telephone, facsimile or messenger. The Company will also pay persons holding
shares of the Common Stock in their names or in the names of the nominees, but
not owning such shares beneficially, such as brokerage houses, banks and other
fiduciaries, for the expense of forwarding soliciting materials to their
principals. All of the costs of the solicitation of proxies will be paid by the
Company.

OTHER MATTERS

The Board of Directors knows of no other business which will be presented
to the meeting. If any other business is properly brought before the meeting, it
is intended that proxies in the enclosed form will be voted in respect thereof
in accordance with the judgment of the persons voting the proxies.

Whether you intend to be present at this meeting or not, you are urged to
return your proxy promptly.

By order of the Board of Directors.

Ronald W. Tarrant
Chairman of the Board

[FLOW INTERNATIONAL CORPORATION LOGO]

18
<PAGE> 20
EXHIBIT A

FLOW INTERNATIONAL CORPORATION
1995 LONG-TERM INCENTIVE COMPENSATION PLAN

SECTION 1.
PURPOSE

The purpose of the Flow International Corporation 1995 Long-Term Incentive
Compensation Plan (the "Plan") is to enhance the long-term profitability and
stockholder value of Flow International Corporation, a Delaware corporation (the
"Company"), by offering incentives and rewards to those employees, consultants
and agents of the Company and its Subsidiaries (as defined in Section 2 below)
who are key to the Company's growth and success, and to encourage them to remain
in the service of the Company and its Subsidiaries and to acquire and maintain
stock ownership in the Company.

SECTION 2.
DEFINITIONS

For purposes of the Plan, the following terms shall be defined as set forth
below:

2.1 AWARD

"Award" means an award or grant made to a Participant pursuant to the Plan,
including, without limitation, awards or grants of Options, Stock Appreciation
Rights, Stock Awards, Other Stock-Based Awards or any combination of the
foregoing (including any Dividend Equivalent Rights granted in connection with
such Awards).

2.2 BOARD

"Board" means the Board of Directors of the Company.

2.3 CAUSE

"Cause" means dishonesty, fraud, misconduct, unauthorized use or disclosure
of confidential information or trade secrets, or conviction or confession of a
crime punishable by law (except minor violations), in each case as determined by
the Plan Administrator, and its determination shall be conclusive and binding.

2.4 CODE

"Code" means the Internal Revenue Code of 1986, as amended from time to
time.

2.5 COMMON STOCK

"Common Stock" means the common stock, par value $.01 per share, of the
Company.

2.6 CORPORATE TRANSACTION

"Corporate Transaction" means any of the following events:

(a) Approval by the holders of the Common Stock of any merger or
consolidation of the Company in which the Company is not the continuing or
surviving corporation or pursuant to which shares of Common Stock are converted
into cash, securities or other property, other than a merger of the Company in
which the holders of the Common Stock immediately prior to the merger have
substantially the same proportionate ownership of common stock of the surviving
corporation immediately after the merger;

(b) Approval by the holders of the Common Stock of any sale, lease,
exchange or other transfer in one transaction or a series of related
transactions of all or substantially all of the Company's assets other than a
transfer of the Company's assets to a majority-owned subsidiary (as the term
"subsidiary" is defined in Section 8.3 of the Plan) of the Company; or

(c) Approval by the holders of the Common Stock of any plan or proposal
for the liquidation or dissolution of the Company.

2.7 DISABILITY

"Disability" means "disability" as that term is defined for purposes of the
Company's Long Term Disability Income Plan or other similar successor plan
applicable to salaried employees.

2.8 DIVIDEND EQUIVALENT RIGHT

"Dividend Equivalent Right" means an Award granted under Section 12 of the
Plan.

2.9 EARLY RETIREMENT

"Early Retirement" means retirement as that term is defined by the Plan
Administrator from time to time for purposes of the Plan.

1
<PAGE> 21
EXHIBIT A

2.10 EXCHANGE ACT

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

2.11 FAIR MARKET VALUE

"Fair Market Value" means the closing price for the Common Stock as
reported in The Wall Street Journal NASDAQ National Market Issues (or similar
successor transactions reports) for a single trading day.

2.12 GOOD REASON

"Good Reason" means the occurrence of any of the following events or
conditions:

(a) a change in the Holder's status, title, position or responsibilities
(including reporting responsibilities) that, in the Holder's reasonable
judgment, represents a substantial reduction of the status, title, position or
responsibilities as in effect immediately prior thereto; the assignment to the
Holder of any duties or responsibilities that, in the Holder's reasonable
judgment, are inconsistent with such status, title, position or
responsibilities; or any removal of the Holder from or failure to reappoint or
reelect the Holder to any of such positions, except in connection with the
termination of the Holder's employment for Cause, for Disability or as a result
of his or her death, or by the Holder other than for Good Reason;

(b) a reduction in the Holder's annual base salary;

(c) the Company's requiring the Holder (without the Holder's consent) to
be based at any place outside a 35-mile radius of his or her place of employment
prior to a Corporate Transaction, except for reasonably required travel on the
Company's business that is not materially greater than such travel requirements
prior to the Corporate Transaction;

(d) the Company's failure to (i) continue in effect any material
compensation or benefit plan (or the substantial equivalent thereof in which the
Holder was participating at the time of a Corporate Transaction, including, but
not limited to, the Plan, or (ii) provide the Holder with compensation and
benefits at least equal (in terms of benefit levels and/or reward opportunities)
to those provided for under each employee benefit plan, program and practice as
in effect immediately prior to the Corporate Transaction (or as in effect
following the Corporate Transaction, if greater);

(e) any material breach by the Company of any provision of the Plan; or

(f) any purported termination of the Holder's employment or service for
Cause by the Company that does not comply with the terms of the Plan.

2.13 GRANT DATE

"Grant Date" means the date designated in a resolution of the Plan
Administrator as the date an Award is granted. If the Plan Administrator does
not designate a Grant Date in the resolution, the Grant Date shall be the date
the Plan Administrator adopted the resolution.

2.14 HOLDER

"Holder" means the Participant to whom an Award is granted, or the
personal representative of a Holder who has died.

2.15 INCENTIVE STOCK OPTION

"Incentive Stock Option" means an option to purchase Common Stock granted
under Section 7 of the Plan with the intention that it qualify as an "incentive
stock option" as that term is defined in Section 422 of the Code.

2.16 NONQUALIFIED STOCK OPTION

"Nonqualified Stock Option" means an option to purchase Common Stock
granted under Section 7 of the Plan other than an Incentive Stock Option.

2.17 OPTION

"Option" means the right to purchase Common Stock granted under Section 7
of the Plan.

2.18 OTHER STOCK-BASED AWARD

"Other Stock-Based Award" means an Award granted under Section 11 of the
Plan.

2.19 PARTICIPANT

"Participant" means an individual who is a Holder of an Award or, as the
context may require, any employee, consultant or agent of the Company or a
Subsidiary who has been designated by the Plan Administrator as eligible to
participate in the Plan.

2
<PAGE> 22

EXHIBIT A

2.20 PLAN ADMINISTRATOR

"Plan Administrator" means any committee of the Board designated to
administer the Plan under Section 3.1 of the Plan.

2.21 RESTRICTED STOCK

"Restricted Stock" means shares of Common Stock granted under Section 10
of the Plan, the rights of ownership of which are subject to restrictions
prescribed by the Plan Administrator.

2.22 RETIREMENT

"Retirement" means retirement as of the individual's normal retirement
date under the Company's Voluntary Pension and Salary Deferral Plan or other
similar successor plan applicable to salaried employees.

2.23 STOCK APPRECIATION RIGHT

"Stock Appreciation Right" means an Award granted under Section 9 of the
Plan.

2.24 STOCK AWARD

"Stock Award" means an Award granted under Section 10 of the Plan.

2.25 SUBSIDIARY

"Subsidiary," except as expressly provided otherwise, means any entity
that is directly or indirectly controlled by the Company or in which the Company
has a significant ownership interest, as determined by the Plan Administrator,
and any entity that may become a direct or indirect parent of the Company.

2.26 WINDOW PERIOD

"Window Period" means a period of 10 days on which there is trading in the
Common Stock on the NASDAQ National Market, beginning with the second trading
day after disclosure by the Company to the public of its earnings for the fiscal
period just ended and ending with the eleventh such day.

2.27 WINDOW PERIOD FAIR
MARKET VALUE

"Window Period Fair Market Value" means the highest Fair Market Value
during a Window Period.

SECTION 3.
ADMINISTRATION

3.1 PLAN ADMINISTRATOR

The Plan shall be administered by a committee or committees (which term
includes subcommittees) appointed by, and consisting of one or more members of,
the Board. The Board may delegate the responsibility for administering the Plan
with respect to designated classes of eligible Participants to different
committees, subject to such limitations as the Board deems appropriate.
Committee members shall serve for such term as the Board may determine, subject
to removal by the Board at any time. The composition of any committee
responsible for administering the Plan with respect to officers and directors of
the Company who are subject to Section 16 of the Exchange Act with respect to
securities of the Company shall comply with the requirements of Rule 16b-3
promulgated under Section 16(b) of the Exchange Act, or any successor provision.

3.2 ADMINISTRATION AND
INTERPRETATION BY THE PLAN
ADMINISTRATOR

Except for the terms and conditions explicitly set forth in the Plan, the
Plan Administrator shall have exclusive authority, in its discretion, to
determine all matters relating to Awards under the Plan, including the selection
of individuals to be granted Awards, the type of Awards, the number of shares of
Common Stock subject to an Award, all terms, conditions, restrictions and
limitations, if any, of an Award and the terms of any instrument that evidences
the Award. The Plan Administrator shall also have exclusive authority to
interpret the Plan and may from time to time adopt, and change, rules and
regulations of general application for the Plan's administration.

The Plan Administrator's interpretation of the Plan and its rules and
regulations, and all actions taken and determinations made by the Plan
Administrator pursuant to the Plan, shall be conclusive and binding on all
parties involved or affected. The Plan Administrator may delegate administrative
duties to such of the Company's officers as it so determines.

SECTION 4.
STOCK SUBJECT TO THE PLAN

4.1 AUTHORIZED NUMBER OF SHARES

Subject to adjustment from time to time as provided in Section 16.1, a
maximum of 750,000 shares of Common Stock shall be available for issuance under
the Plan, except that any shares of Common Stock that, as of the date the Plan
is approved by the Company's stockholders, are avail-

<PAGE> 23

EXHIBIT A

able for issuance under the Company's 1991 Stock Option Plan and 1984 Restated
Stock Option Plan (or that thereafter become available for issuance under those
plans in accordance with their terms as in effect on such date) and that are not
issued under those plans shall be added to the aggregate number of shares
available for issuance under the Plan. No more than 250,000 shares may be issued
as Stock Awards or Other Stock-Based Awards under the Plan. Shares issued under
the Plan shall be drawn from authorized and unissued shares or shares now held
or subsequently acquired by the Company as treasury shares.

4.2 INDIVIDUAL AWARD LIMIT

Subject to adjustment from time to time as provided in Section 16.1, not
more than 250,000 shares of Common Stock may be made subject to Awards under the
Plan to any Participant in any one fiscal year of the Company, such limitation
to be applied in a manner consistent with the requirements of, and only to the
extent required for compliance with, the exclusion from the limitation on
deductibility of compensation under Section 162(m) of the Code.

4.3 REUSE OF SHARES

Any shares of Common Stock that have been made subject to an Award that
cease to be subject to the Award (other than by reason of exercise or payment of
the Award to the extent it is exercised for or settled in shares), including,
without limitation, in connection with the cancellation of an Award and the
grant of a replacement Award, shall again be available for issuance in
connection with future grants of Awards under the Plan. Shares that are subject
to tandem Awards shall be counted only once.

SECTION 5.
ELIGIBILITY

Awards may be granted under the Plan to those officers and key employees
(including directors who are also employees) of the Company and its Subsidiaries
as the Plan Administrator from time to time selects. Awards may also be made to
consultants and agents who provide services to the Company and its Subsidiaries.

SECTION 6.
AWARDS

6.1 FORM AND GRANT OF AWARDS

The Plan Administrator shall have the authority, in its sole discretion,
to determine the type or types of Awards to be made under the Plan. Such Awards
may include, but are not limited to, Incentive Stock Options, Nonqualified Stock
Options, Stock Appreciation Rights, Stock Awards, Other Stock-Based Awards and
Dividend Equivalent Rights. Awards may be granted singly, in combination or in
tandem so that the settlement or payment of one automatically reduces or cancels
the other. Awards may also be made in combination or in tandem with, in
replacement of, as alternatives to, or as the payment form for, grants or rights
under any other employee or compensation plan of the Company.

6.2 ACQUIRED COMPANY AWARDS

Notwithstanding anything in the Plan to the contrary, the Plan
Administrator may grant Awards under the Plan in substitution for awards issued
under other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of other entities ("Acquired Entities") (or
the parent of the acquired entity) and the new Award is substituted, or the old
award is assumed, by reason of a merger, consolidation, acquisition of property
or of stock, reorganization or liquidation (the "Acquisition Transaction"). In
the event that a written agreement pursuant to which the Acquisition Transaction
is completed is approved by the Board and said agreement sets forth the terms
and conditions of the substitution for or assumption of outstanding awards of
the acquired entity, said terms and conditions shall be deemed to be the action
of the Plan Administrator without any further action by the Plan Administrator,
except as may be required for compliance with Rule 16b-3 under the Exchange Act,
and the persons holding such Awards shall be deemed to be Participants and
Holders.

SECTION 7.
AWARDS OF OPTIONS

7.1 GRANT OF OPTIONS

The Plan Administrator is authorized under the Plan, in its sole
discretion, to issue Options as Incentive Stock Options or as Nonqualified Stock
Options, which shall be appropriately designated.

7.2 OPTION EXERCISE PRICE

The exercise price for shares purchased under an Option shall be as
determined by the Plan Administrator, but shall not be less than 100% of the
Fair Market Value of the Common Stock on the

<PAGE> 24

EXHIBIT A

Grant Date with respect to Incentive Stock Options.

7.3 TERM OF OPTIONS

The term of each Option shall be as established by the Plan Administrator
or, if not so established, shall be 10 years from the Grant Date.

7.4 EXERCISE OF OPTIONS

The Plan Administrator shall establish and set forth in each instrument
that evidences an Option the time at which or the installments in which the
Option shall become exercisable, which provisions may be waived or modified by
the Plan Administrator at any time. If not so established in the instrument
evidencing the Option, the Option will become exercisable according to the
following schedule, which may be waived or modified by the Plan Administrator at
any time:

PERIOD OF HOLDER'S CONTINUOUS
EMPLOYMENT OR SERVICE WITH THE
COMPANY OR ITS SUBSIDIARIES PERCENT OF TOTAL OPTION
FROM THE OPTION GRANT DATE THAT IS EXERCISABLE
- ------------------------------ -----------------------
<S> <C>
after one year 50%

after two years 100%

</TABLE>

To the extent that the right to purchase shares has accrued thereunder, an
Option may be exercised from time to time by written notice to the Company, in
accordance with procedures established by the Plan Administrator, setting forth
the number of shares with respect to which the Option is being exercised and
accompanied by payment in full as described in Section 7.5.

7.5 PAYMENT OF EXERCISE PRICE

The exercise price for shares purchased under an Option shall be paid in
full to the Company by delivery of consideration equal to the product of the
Option exercise price and the number of shares purchased. Such consideration
must be paid in cash, except that the Plan Administrator may, either at the time
the Option is granted or at any time before it is exercised and subject to such
limitations as the Plan Administrator may determine, authorize payment in cash
and/or one or more of the following alternative forms: (i) Common Stock already
owned by the Holder for at least six months (or any shorter period necessary to
avoid a charge to the Company's earnings for financial reporting purposes)
having a Fair Market Value on the day prior to the exercise date equal to the
aggregate Option exercise price;

(ii) a promissory note authorized pursuant to Section 13; (iii) delivery of a
properly executed exercise notice, together with irrevocable instructions, to
(a) a brokerage firm designated by the Company to deliver promptly to the
Company the aggregate amount of sale or loan proceeds to pay the Option exercise
price and any withholding tax obligations that may arise in connection with the
exercise and (b) the Company to deliver the certificates for such purchased
shares directly to such brokerage firm, all in accordance with the regulations
of the Federal Reserve Board; or (iv) such other consideration as the Plan
Administrator may permit.

7.6 POST-TERMINATION EXERCISES

The Plan Administrator shall establish and set forth in each instrument
that evidences an Option whether the Option will continue to be exercisable, and
the terms and conditions of such exercise, if a Holder ceases to be employed by,
or to provide services to, the Company or its Subsidiaries, which provisions may
be waived or modified by the Plan Administrator at any time. If not so
established in the instrument evidencing the Option, the Option will be
exercisable according to the following terms and conditions, which may be waived
or modified by the Plan Administrator at any time. In case of termination of the
Holder's employment or services other than by reason of death or Cause, the
Option shall be exercisable, to the extent of the number of shares purchasable
by the Holder at the date of such termination, only: (i) within three years if
the termination of the Holder's employment or services are coincident with
Retirement, Early Retirement at the Company's request or Disability or (ii)
within three months after the date the Holder ceases to be an employee,
consultant or agent of the Company or a Subsidiary if termination of the
Holder's employment or services is for any reason other than Retirement, Early
Retirement at the Company's request, or Disability, but in no event later than
the remaining term of the Option. Any Option exercisable at the time of the
Holder's death may be exercised, to the extent of the number of shares
purchasable by the Holder at the date of the Holder's death by the personal
representative of the Holder's estate entitled thereto at any time or from time
to time within three years after the date of death, but in no event later than
the remaining term of the Option. In case of termination of the Holder's
employment or services for Cause, the Option shall automatically terminate upon
first notification to

5
<PAGE> 25
EXHIBIT A

the Holder of such termination, unless the Plan Administrator determines
otherwise. If a Holder's employment or services with the Company are suspended
pending an investigation of whether the Holder shall be terminated for Cause,
all the Holder's rights under any Option likewise shall be suspended during the
period of investigation. A transfer of employment or services between or among
the Company and its Subsidiaries shall not be considered a termination of
employment or services. Unless the Plan Administrator determines otherwise, a
leave of absence approved in accordance with Company procedures shall not be
considered a termination of employment or services, except that with respect to
Incentive Stock Options such leave of absence shall be subject to any
requirements of Section 422 of the Code.

SECTION 8.
INCENTIVE STOCK OPTION LIMITATIONS

To the extent required by Section 422 of the Code, Incentive Stock Options
shall be subject to the following additional terms and conditions:

8.1 DOLLAR LIMITATION

To the extent the aggregate Fair Market Value (determined as of the Grant
Date) of Common Stock with respect to which Incentive Stock Options are
exercisable for the first time during any calendar year (under the Plan and all
other stock option plans of the Company) exceeds $100,000, such portion in
excess of $100,000 shall be treated as a Nonqualified Stock Option. In the event
the Participant holds two or more such Options that become exercisable for the
first time in the same calendar year, such limitation shall be applied on the
basis of the order in which such Options are granted.

8.2 10% STOCKHOLDERS

If a Participant owns 10% or more of the total voting power of all classes of
the Company's stock, then the exercise price per share of an Incentive Stock
Option shall not be less than 110% of the Fair Market Value of the Common Stock
on the Grant Date and the Option term shall not exceed five years.

8.3 ELIGIBLE EMPLOYEES

Individuals who are not employees of the Company or one of its parent
corporations or subsidiary corporations may not be granted Incentive Stock
Options. For purposes of this Section 8.3, "parent corporation" and "subsidiary
corporation" shall have the meanings attributed to those terms for purposes of
Section 422 of the Code.

8.4 TERM

The term of an Incentive Stock Option shall not exceed 10 years.

8.5 EXERCISABILITY

An Option designated as an Incentive Stock Option must be exercised within three
months after termination of employment for reasons other than death or one year
after termination of employment or services due to Disability to qualify for
Incentive Stock Option tax treatment.

SECTION 9.
STOCK APPRECIATION RIGHTS

9.1 GRANT OF STOCK APPRECIATION RIGHTS

The Plan Administrator may grant a Stock Appreciation Right separately or in
tandem with a related Option.

9.2 TANDEM STOCK APPRECIATION RIGHTS

A Stock Appreciation Right granted in tandem with a related Option will give
the Holder the right to surrender to the Company all or a portion of the related
Option and to receive an appreciation distribution (in shares of Common Stock or
cash or any combination of shares and cash, as the Plan administrator shall
determine at any time) in an amount equal to the excess of the Fair Market Value
for the Window Period during which the Stock appreciation Right is exercised
over the exercise price per share of the right, which shall be the same as the
exercise price of the related Option, except that if the right is exercised
during a Window Period, the amount will be equal to the excess of the Window
Period Fair Market Value for the Window Period during which the Stock
Appreciation Plight is exercised over the exercise price per share of the right.
A tandem Stock Appreciation Right will have the same other terms and provisions
as the related Option. Upon and to the extent a tandem Stock Appreciation Right
is exercised, the related Option will terminate.

9.3 STAND-ALONE STOCK
APPRECIATION RIGHTS

A Stock Appreciation Right granted separately and not in tandem with an
Option will give the Holder the right to receive an appreciation distribu-

<PAGE> 26
EXHIBIT A

tion in an amount equal to the excess of the Fair Market Value for the date the
Stock Appreciation Right is exercised over the per share exercise price of the
right, except that if the right is exercised during a Window Period, the amount
will be equal to the excess of the Window Period Fair Market Value for the
Window Period during which the right is exercised over the per share exercise
price of the right. A standalone Stock Appreciation Right will have such terms
as the Plan Administrator may determine, except that the term of the right, if
not otherwise established by the Plan Administrator, shall be 10 years from the
Grant Date.

9.4 EXERCISE OF STOCK APPRECIATION RIGHTS

Unless otherwise provided by the Plan Administrator in the instrument that
evidences the Stock Appreciation Right, the provisions of Section 7.6 relating
to the termination of a Holder's employment or services shall apply equally, to
the extent applicable, to the Holder of a Stock Appreciation Right. Stock
Appreciation Rights held by Participants who are subject to Section 16 of the
Exchange Act may be exercised solely in accordance with the requirements for
compliance with Rule 16b-3 under the Exchange Act.

SECTION 10.
STOCK AWARDS

10.1 GRANT OF STOCK AWARDS

The Plan Administrator is authorized to make Awards of Common Stock to
Participants on such terms and conditions and subject to such restrictions, if
any (whether based on performance standards, periods of service or otherwise),
as the Plan Administrator shall determine, which terms, conditions and
restrictions shall be set forth in the instrument evidencing the Award. The
terms, conditions and restrictions that the Plan Administrator shall have the
power to determine shall include, without limitation, the manner in which shares
subject to Stock Awards are held during the periods they are subject to
restrictions and the circumstances under which forfeiture of Restricted Stock
shall occur by reason of termination of the Holder's services.

10.2 ISSUANCE OF SHARES

Upon the satisfaction of any terms, conditions and restrictions prescribed in
respect to a Stock Award, or upon the Holder's release from any terms,
conditions and restrictions of a Stock Award, as determined by the Plan
Administrator, the Company shall deliver, as soon as practicable, to the Holder
or, in the case of the Holder's death, to the personal representative of the
Holder's estate or as the appropriate court directs, a stock certificate for the
appropriate number of shares of Common Stock.

10.3 WAIVER OF RESTRICTIONS

Notwithstanding any other provisions of the Plan, the Plan Administrator may,
in its sole discretion, waive the forfeiture period and any other terms,
conditions or restrictions on any Restricted Stock under such circumstances and
subject to such terms and conditions as the Plan Administrator shall deem
appropriate.

SECTION 11.
OTHER STOCK-BASED AWARDS

The Plan Administrator may grant other Awards under the Plan pursuant to
which shares of Common Stock (which may, but need not, be shares of Restricted
Stock pursuant to Section 10) are or may in the future be acquired, or Awards
denominated in stock units, including ones valued using measures other than
market value. Such Other Stock-Based Awards may be granted alone or in addition
to or in tandem with any Award of any type granted under the Plan and must be
consistent with the Plan's purpose.

SECTION 12.
DIVIDEND EQUIVALENT RIGHTS

Any Awards under the Plan may, in the Plan Administrator's discretion, earn
Dividend Equivalent Rights. In respect of any Award that is outstanding on the
dividend record date for Common Stock, the Participant may be credited with an
amount equal to the cash or stock dividends or other distributions that would
have been paid on the shares of Common Stock covered by such Award had such
covered shares been issued and outstanding on such dividend record date. The
Plan Administrator shall establish such rules and procedures governing the
crediting of Dividend Equivalent Plights, including the timing, form of payment
and payment contingencies of such Dividend Equivalent Rights, as it deems are
appropriate or necessary.

7
<PAGE> 27

EXHIBIT A

SECTION 13.
LOANS, LOAN GUARANTEES AND INSTALLMENT PAYMENTS

To assist a Holder (including a Holder who is an officer or director of the
Company) in acquiring shares of Common Stock pursuant to an Award granted under
the Plan, the Plan Administrator may authorize, either at the Grant Date or at
any time before the acquisition of Common Stock pursuant to the Award, (i) the
extension of a loan to the Holder by the Company, (ii) the payment by the Holder
of the purchase price, if any, of the Common Stock in installments, or (iii) the
guarantee by the Company of a loan obtained by the grantee from a third party.
The terms of any loans, installment payments or guarantees, including the
interest rate and terms of repayment, will be subject to the Plan
Administrator's discretion. Loans, installment payments and guarantees may be
granted with or without security. The maximum credit available is the purchase
price, if any, of the Common Stock acquired plus the maximum federal and state
income and employment tax liability that may be incurred in connection with the
acquisition.

SECTION 14.
ASSIGNABILITY

No Option, Stock Appreciation Right, Other Stock-Based Award or Dividend
Equivalent Right granted under the Plan may be assigned or transferred by the
Holder other than by will or by the laws of descent and distribution, and during
the Holder's lifetime, such Awards may be exercised only by the Holder.
Notwithstanding the foregoing, and to the extent permitted by Rule 16b-3 under
the Exchange Act and Section 422 of the Code, the Plan Administrator, in its
sole discretion, may permit such assignment, transfer and exercisability and may
permit a Holder of such Awards to designate a beneficiary who may exercise the
Award or receive compensation under the Award after the Holder's death.

SECTION 15.
ADJUSTMENTS

15.1 ADJUSTMENT OF SHARES

In the event that at any time or from time to time a stock dividend, stock
split, spin-off, combination or exchange of shares, recapitalization, merger,
consolidation, distribution to stockholders other than a normal cash dividend,
or other change in the Company's corporate or capital structure results in (i)
the outstanding shares, or any securities exchanged therefor or received in
their place, being exchanged for a different number or class of securities of
the Company or of any other corporation or (ii) new, different or additional
securities of the Company or of any other corporation being received by the
holders of shares of Common Stock of the Company, then the Plan Administrator,
in its sole discretion, shall make such equitable adjustments as it shall deem
appropriate in the circumstances in (a) the maximum number of and class of
securities subject to the Plan as set forth in Section 4. 1, (b) the maximum
number and class of securities that may be made subject to Awards to any
individual Participant as set forth in Section 4.2, and (e) the number and class
of securities that are subject to any outstanding Award and the per share price
of such securities, without any change in the aggregate price to be paid
therefor. The determination by the Plan Administrator as to the terms of any of
the foregoing adjustments shall be conclusive and binding.

15.2 CORPORATE TRANSACTION

Except as otherwise provided in the instrument that evidences the Award, in
the event of any Corporate Transaction, each Option, Stock Appreciation Right or
Stock Award that is at the time outstanding shall automatically accelerate so
that each such Award shall, immediately prior to the specified effective date
for the Corporate Transaction, become 100% vested, except that such acceleration
will not occur if in the opinion of the Company's accountants it would render
unavailable "pooling of interest" accounting for a Corporate Transaction that
would otherwise qualify for such accounting treatment. All such Awards shall
terminate and cease to remain outstanding immediately following the consummation
of the Corporate Transaction, except to the extent assumed by the successor
corporation or its parent corporation. Any such Awards that are assumed or
replaced in the Corporate Transaction and do not otherwise accelerate at that
time shall be accelerated in the event the Holder's employment or services
should subsequently terminate within two years following such Corporate
Transaction, unless such employment or services are terminated by the Company
for Cause or by the Holder voluntarily without Good Reason. Notwithstanding the
foregoing, no Incentive Stock

<PAGE> 28
EXHIBIT A

Option shall become exercisable pursuant to this Section 15.2 without the
Holder's consent, if the result would be to cause such Option not to be treated
as an Incentive Stock Option (whether by reason of the annual limitation
described in Section 8.1 or otherwise).

15.3 FURTHER ADJUSTMENT OF AWARDS

Without limiting the preceding Section 15.2, and subject to the limitations
set forth in Section 11, the Plan Administrator shall have the discretion,
exercisable at any time before a sale, merger, consolidation, reorganization,
liquidation or change in control of the Company, as defined by the Plan
Administrator, to take such further action as it determines to be necessary or
advisable, and fair and equitable to Participants, with respect to Awards. Such
authorized action may include (but shall not be limited to) establishing,
amending or waiving the type, terms, conditions or duration of, or restrictions
on, Awards so as to provide for earlier, later, extended or additional time for
exercise, payment or settlement or lifting restrictions, differing methods for
calculating payments or settlements, alternate forms and amounts of payments and
settlements and other modifications, and the Plan Administrator may take such
actions with respect to all Participants, to certain categories of Participants
or only to individual Participants. The Plan Administrator may take such actions
before or after granting Awards to which the action relates and before or after
any public announcement with respect to such sale, merger, consolidation,
reorganization, liquidation or change in control that is the reason for such
action.

15.4 LIMITATIONS

The grant of Awards will in no way affect the Company's right to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.

SECTION 16.
WITHHOLDING OF TAXES

The Company may require the Holder to pay to the Company the amount of any
withholding taxes that the Company is required to withhold with respect to the
grant, exercise, payment or settlement of any Award. In such instances, the Plan
Administrator may, in its discretion and subject to the Plan and applicable law,
permit the Holder to satisfy withholding obligations, in whole or in part, by
paying cash, by electing to have the Company withhold shares of Common Stock or
by transferring shares of Common Stock to the Company, in such amounts as are
equivalent to the Fair Market Value of the withholding obligation.

SECTION 17.
AMENDMENT AND TERMINATION OF PLAN

17.1 AMENDMENT OF PLAN

The Plan may be amended by the stockholders of the Company. The Board may
also amend the Plan in such respects as it shall deem advisable; however, to the
extent required for compliance with Rule 16b-3 under the Exchange Act, Section
422 of the Code or any applicable law or regulation, stockholder approval will
be required for any amendment that will (i) increase the total number of shares
as to which Options may be granted or which may be used in payment of Stock
Appreciation Rights, Performance Awards, Other Stock-Based Awards or Dividend
Equivalent Rights under the Plan or that may be issued as Restricted Stock, (ii)
materially modify the class of persons eligible to receive Awards, (iii)
materially increase the benefits accruing to Participants under the Plan, or
(iv) otherwise require stockholder approval under any applicable law or
regulation.

17.2 TERMINATION OF PLAN

The stockholders or the Board may suspend or terminate the Plan at any time.
The Plan will have no fixed expiration date; provided, however, that no
Incentive Stock Options may be granted more than 10 years after the Plan s
effective date.

17.3 CONSENT OF HOLDER

The amendment or termination of the Plan shall not, without the consent of
the Holder of any Award under the Plan, alter or impair any rights or
obligations under any Award theretofore granted under the Plan.

SECTION 18.
GENERAL

18.1 NOTIFICATION

The Plan Administrator shall promptly notify a Participant of an Award, and a
written grant shall promptly be executed and delivered by or on behalf of the
Company.

<PAGE> 29

EXHIBIT A

18.2 CONTINUED EMPLOYMENT OR SERVICES; RIGHTS IN AWARDS

Neither the Plan, participation in the Plan as a Participant nor any action
of the Plan Administrator taken under the Plan shall be construed as giving any
Participant or employee of the Company any right to be retained in the employ of
the Company or limit the Company's right to terminate the employment or services
of the Participant.

18.3 REGISTRATION; CERTIFICATES FOR SHARES

The Company shall be under no obligation to any Participant to register for
offering or resale under the Securities Act of 1933, as amended, or register or
qualify under state securities laws, any shares of Common Stock, security or
interest in a security paid or issued under, or created by, the Plan. The
Company may issue certificates for shares with such legends and subject to such
restrictions on transfer and stop-transfer instructions as counsel for the
Company deems necessary or desirable for compliance by the Company with federal
and state securities laws.

18.4 NO RIGHTS AS A STOCKHOLDER

No Option, Stock Appreciation Right or Other Stock-Based Award shall entitle
the Holder to any dividend (except to the extent provided in an Award of
Dividend Equivalent Rights), voting or other right of a stockholder unless and
until the date of issuance under the Plan of the shares that are the subject of
such Awards, free of all applicable restrictions.

18.5 COMPLIANCE WITH LAWS AND REGULATIONS

It is the Company's intention that, so long as any of the Company's equity
securities are registered pursuant to Section 12(b) or 12(g) of the Exchange
Act, the Plan shall comply in all respects with Rule 16b-3 under the Exchange
Act and, if any Plan provision is later found not to be in compliance with such
Rule, the provision shall be deemed null and void, and in all events the Plan
shall be construed in favor of its meeting the requirements of Rule 16b-3.
Notwithstanding anything in the Plan to the contrary, the Board, in its sole
discretion, may bifurcate the Plan so as to restrict, limit or condition the use
of any provision of the Plan to Participants who are officers or directors
subject to Section 16 of the Exchange Act without so restricting, limiting or
conditioning the Plan with respect to other Participants. Additionally, in
interpreting and applying the provisions of the Plan, any Option granted as an
Incentive Stock Option pursuant to the Plan shall, to the extent permitted by
law, be construed as an "Incentive stock option" within the meaning of Section
422 of the Code.

18.6 NO TRUST OR FUND

The Plan is intended to constitute an "unfunded" plan. Nothing contained
herein shall require the Company to segregate any monies or other property, or
shares of Common Stock, or to create any trusts, or to make any special deposits
for any immediate or deferred amounts payable to any Participant, and no
Participant shall have any rights that are greater than those of a general
unsecured creditor of the Company.

18.7 GOVERNING LAW

The Plan and all interpretations of its provisions shall be governed by the
laws of the state of Washington and applicable federal laws.

18.8 SEVERABILITY

If any provision of the Plan or any Award is determined to be invalid,
illegal or unenforceable in any jurisdiction, or as to any person, or would
disqualify the Plan or any Award under any law deemed applicable by the Plan
Administrator, such provision shall be construed or deemed amended to conform to
applicable laws, or, if it cannot be so construed or deemed amended without, in
the Plan Administrator's determination, materially altering the intent of the
Plan or the Award, such provision shall be stricken as to such jurisdiction,
person or Award, and the remainder of the Plan and any such Award shall remain
in full force and effect.

SECTION 19.
EFFECTIVE DATE

The Plan's effective date is the date on which it is adopted by the Board, so
long as it is approved by the Company's stockholders at any time within 12
months of such adoption or, if earlier, and to the extent required for
compliance with Rule 16b-3 under the Exchange Act, at the next annual meeting of
the Company's stockholders after adoption of the Plan by the Board.

Adopted by the Board on ______________, 1995 and approved by the Company's
stockholders on _____________, 1995.

<PAGE> 30

PROXY

FLOW INTERNATIONAL CORPORATION

SOLICITED BY THE BOARD OF DIRECTORS

ANNUAL MEETING OF STOCKHOLDERS
AUGUST 30, 1995

The undersigned hereby appoints Ronald W. Tarrant, Thomas A. Cross and
John S. Leness, and each or any of them, with power of substitution, proxies for
the undersigned and authorizes them to represent and vote, as designated, all of
the shares of stock of the Company which the undersigned may be entitled to vote
at the Annual Meeting of the Stockholders to be held at the Washington Athletic
Club, 1325 Sixth Avenue, Seattle, Washington 98111, on August 30, 1995, and at
any adjournment of such meeting, for the following purposes and with
discretionary authority as to any other matters that may properly come before
the meeting, all in accordance with and as described in the Notice and
accompanying Proxy Statement.

If this Proxy is executed by you without indicating a choice regarding the
nominees for director or without indicating a choice regarding Proposal 2, it
will be deemed to grant authority to vote FOR the nominees for director and FOR
Proposal 2.

IMPORTANT -- TO BE SIGNED AND DATED ON REVERSE SIDE
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<PAGE> 31

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTOR.

1. ELECTION OF FOUR DIRECTORS:

FOR the nominees WITHHOLD
listed to the right AUTHORITY
(except as marked to vote for the
to the contrary). nominees listed.

/ / / /

NOMINEES for Three-Year Terms: Ron D. Barbaro, Arlen I. Prentice,
Dr. J. Michael Ribaudo

NOMINEE for One-Year Term: John S. Cargill

(INSTRUCTIONS: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)

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2. APPROVAL OF 1995 LONG-TERM INCENTIVE COMPENSATION PLAN

WITHHOLD
FOR AGAINST AUTHORITY

/ / / / / /

THIS PROXY IS SOLICITED BY MANAGEMENT. A majority of said proxies, including
any substitutes, or if only one of them be present then that one, may exercise
all powers granted hereunder at said meeting or any adjournment thereof. This
proxy revokes any proxy to vote such shares at such meeting or any adjournment
thereof heretofore given by the undersigned to anyone other than those named
above.

Signature must be that of him/herself. If shares are held jointly, each
shareholder named should sign. If the signer is a corporation, please sign the
full corporate name by duly authorized officer. If the signer is a
partnership, please sign partnership name by authorized person. Executors,
administrators, trustees, guardians, attorneys-in-fact, etc., should so
indicate when signing.

Dated: , 1995
--------------------------------
IMPORTANT - PLEASE INSERT

- --------------------------------------------
Signature

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FOLD AND DETACH HERE