AGREEMENT AND PLAN OF REORGANIZATION
                                

      THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement")
is  made and entered into as of October 11, 1996, and is  by  and
between  Fountain  Powerboat Industries, Inc.  ("Industries"),  a
Nevada  corporation, Fountain Powerboats, Inc.  ("Powerboats",  a
North  Carolina  corporation  and a wholly  owned  subsidiary  of
Industries,  Fountain  Power, Inc. ("Power"),  a  North  Carolina
corporation and a wholly owned subsidiary of Powerboats, and Mach
Performance, Inc. ("Mach"), a Florida corporation.

                         R E C I T A L S

      WHEREAS, the Boards of Directors of Industries, Powerboats,
Power  and  Mach deem it advisable and in the best  interests  of
Industries,  Powerboats,  Power and  Mach  and  their  respective
shareholders that Power and Mach combine; and

     WHEREAS, Industries is a public company; and

      WHEREAS,  Industries is the owner of  all  the  outstanding
shares  Powerboats, which, in turn, is the owner of  all  of  the
outstanding shares of Power; and

      WHEREAS, the Boards of Directors of Industries, Powerboats,
Power  and  Mach  deem  it  advisable  that  the  acquisition  by
Industries  of Mach be effected through the merger of  Power  and
Mach  (the  "Merger") pursuant to this Agreement and an Agreement
of Merger; and

       WHEREAS,  Industries  desires  to  acquire  all   of   the
outstanding Mach shares for Eighty-five Thousand (85,000)  shares
of  voting Common Stock of Industries, which common shares  shall
be restricted from sale, transfer, or hypothecation, as follows:

      Twenty-eight   Thousand  Three  Hundred  and   Thirty-three
      (28,333)  shares  shall  be restricted  until  October  11,
      1998, and
      
      Twenty-eight   Thousand  Three  Hundred  and   Thirty-three
      (28,333)  shares  shall  be restricted  until  October  11,
      1999, and
      
      Twenty-eight   Thousand  Three  Hundred   and   Thirty-four
      (28,334)  shares  shall  be restricted  until  October  11,
      2000.
      
      The foregoing shares shall bear appropriate legends on  the
share  certificates restricting that shares from sale,  transfer,
or  hypothecation, in a transaction that qualifies under  Section
368(a)(2)(D)  of Internal Revenue Code of 1986, as  amended  (the
"Code"); and

<PAGE>

     In the event of any merger, consolidation, reorganization or
liquidation of Industries with one or more corporations in  which
Industries  is not the surviving corporation, or the transfer  of
substantially all of Industries assets, or the transfer  of  more
than fifty percent (50%) of the then outstanding shares of Common
Stock  of  Industries  to  any person, persons,  or  corporations
("change  of  control"), then in that event Industries  Board  of
Directors shall authorize the termination of the foregoing common
stock restrictions, and

      WHEREAS,  the Board of Directors of Industries, Powerboats,
Power   and   Mach   intend   that  the   Merger   constitute   a
"reorganization" under Sections 268 (a)(2)(D) and  368  (a)(2)(E)
of  the  Internal Revenue Code of 1986, as amended (the  "Code"),
and  the  rules  and regulations of the Internal Revenue  Service
(the  "IRS")  promulgated thereunder, have approved  and  adopted
this  Agreement as a "plan of reorganization" within the  meaning
of  Section 368 of the Code, and the rules and regulations of the
IRS promulgated thereunder, and intend that the Merger be treated
as a tax free merger under the Code and the rules and regulations
of the IRS promulgated thereunder.

      NOW,  THEREFORE, in consideration of the mutual  agreements
hereinafter  set  forth,  the parties  hereto,  intending  to  be
legally bound, hereby agree as follows:

I.   MERGER

      1.01  Merger.  Power and Mach shall merger pursuant to  the
North  Carolina  General Corporation Law (the  "Merger")  and  in
accordance   with  the  Agreement  of  merger  among  Industries,
Powerboats, Power and Mach (the "Agreement of Merger"), a copy of
which  is  attached hereto as Exhibit 1.01.  The Merger shall  be
effective  on  the date on which the Agreement of  Merger,  or  a
conformed copy thereof, in substantially the form annexed  hereto
as  Exhibit  1.01, is filed with the Secretary of  the  State  of
North Carolina, which filing shall take place upon Closing.

      1.02  Closing.  The Closing of the transaction contemplated
by  this  Agreement (the "Closing") shall take place as  soon  as
practicable, but is expected to take place prior to December  31,
1996.   At Closing, and pursuant to the Agreement of Merger,  all
outstanding shares of Common Stock of Mach shall be cancelled and
in  lieu  thereof shareholders of Mach common stock shall receive
an   aggregate  of  Eighty-five  Thousand  (85,000)   shares   of
Industries  Common  Stock, which stock will  be  restricted  from
sale,  transfer, or hypothecation as provided above.  At Closing,
Industries,   Powerboats,  Power  and  Mach  shall  deliver   the
following documents:

            1.02(a).   Each of Industries, Powerboats, Power  and
Mach  shall  deliver  an  officer's  certificate  signed  by  its
president  or  chief  financial  officer,  certifying  that   the
representations  and warranties given by Industries,  Powerboats,
Power  and  Mach, respectively, are true and correct  as  of  the
Closing.

                              - 2 -
<PAGE>

            1.02(b).   Mach shall deliver to Industries certified
copies  of  resolutions  of  the Company's  Board  of  Directors,
electing  the  following persons as members of  Mach's  Board  of
Directors and the following persons as directors and officers  of
Mach:

          Reginald M Fountain, Jr.      - Chairman of the Board
          Gary D. Garbrecht             - Director
          Gary E. Mazza, III            - Director
          Federico Pignatelli           - Director
          Mark L. Spencer               - Director
          Reginald M. Fountain, Jr.     - Chief Executive Officer
          Gary D. Garbrecht             - President
          Allan L. Krehbiel             - Vice President and Chief
                                          Financial Officer
          Blanche C. Williams           - Secretary & Treasurer
          Carol J. Price                - Assistant Secretary

            1.02(c).   Industries, Powerboats,  and  Power  shall
deliver to Mach certified resolutions of their respective  Boards
of   Directors   authorizing  the  Merger  and  the  transactions
contemplated by this Agreement.

             1.02(d).    Mach   shall  deliver   to   Industries,
Powerboats,  and  Power certified resolutions  of  its  board  of
Directors  and  shareholders  authorizing  the  Merger  and   the
transactions contemplated by this Agreement.

           1.02(e).  Industries' subsidiary, Powerboats, and Gary
D. Garbrecht shall enter into an Employment Agreement in the form
attached hereto as Exhibit 1.02.

II.  REPRESENTATIONS AND WARRANTIES OF MACH

      Mach represents and warrants to Industries, Powerboats, and
Power as follows, as of the date of this Agreement and as of  the
Closing:

     2.01.  Organization.

          2.01(a).  Mach is a corporation duly organized, validly
existing  and  in good standing under the laws of  the  State  of
Florida;  Mach has the corporate poser and authority to carry  on
its business as presently conducted; and Mach is qualified to  do
business  in  all  jurisdictions  where  the  failure  to  be  so
qualified would have a material adverse effect on its business.

           2.01(b).   The copies of the Articles of Incorporation
and  all amendments thereto of Mach as certified by the Secretary
of  State of Florida, and the copy of the Bylaws as certified  by
the  Secretary of Mach, which have heretofore been  delivered  to
Industries, are complete and correct copies of such Articles of

                              - 3 -

<PAGE>

Incorporation as amended and in effect on the date hereof.  All
minutes and actions in writing without a meeting of the Board of
Directors and shareholders of Mach are contained in the minute
book of Mach heretofore delivered to Industries for examination,
and no minutes or actions in writing have been included in such
minute book since delivery to Industries that have not also been
delivered to Industries.

     2.02.  Capitalization.

           2.02(a).  The authorized capital stock and the  issued
and  outstanding  shares  of Mach are as  set  forth  on  Exhibit
2.02(a).   All of the issued and outstanding shares of  Mach  are
duly authorized, validly issued, fully paid and nonassessable.

           2.02(b).  Except as set forth in Exhibit 2.02(b) there
are  no outstanding options, warrants, or rights to purchase  any
securities of Mach.

      2.03.  Subsidiaries and Investments.  Mach does not own any
capital   stock   or  have  any  interest  in  any   corporation,
partnership  or  other form of business organization,  except  as
described in Exhibit 2.03 hereto.

       2.04.   Financial  Statements.   The  unaudited  financial
statements  of  Mach as of June 30, 1996 and for  the  two  years
ended  December  31, 1995 and 1994, including  unaudited  balance
sheets  and  the  related  unaudited  statements  of  operations,
retained earnings, and cash flows for the periods then ended  and
the  audited financial statements of Mach as of August  31,  1996
and  for  the eight months ended August 31, 1996 (the  "Financial
Statements") present fairly the financial positions  and  results
of operations of Mach, on a consistent basis.

      2.05.  No Undisclosed Liabilities.  Other than as described
in  Exhibit  2.05  hereto, Mach is not subject  to  any  material
liability or obligation of any nature, whether absolute, accrued,
contingent, or otherwise and whether due or to become due,  which
is not reflected or reserved against in the Financial Statements,
except those incurred in the normal course of business.

      2.06.   Absence of Material Changes.  Since June 30,  1996,
except  as  described in any Exhibit hereto  or  as  required  or
permitted under this Agreement, there has not been:

            2.06(a).   any  material  change  in  the   condition
(financial  or otherwise) of the properties, assets,  liabilities
or  business  of Mach, except changes in the ordinary  course  of
business which, individually and in the aggregate, have not  been
materially adverse:

                              - 4 -

<PAGE>

          2.06(b).  any redemption, purchase or other acquisition
of  any  shares of the capital stock of Mach, or any issuance  of
any shares of capital stock or the granting, issuance or exercise
of  any rights, warrants, options or commitments by Mach relating
to their authorized or issued capital stock; or

           2.06(c).   any change or amendment to the Articles  of
Incorporation of Mach.

      2.07.   Litigation.  Except as set forth  in  Exhibit  2.07
attached   hereto,   there  is  no  litigation,   proceeding   or
investigation pending or threatened against Mach affecting any of
its  properties  or  assets  against any  officer,  director,  or
stockholder of Mach that might result, either in any case  or  in
the  aggregate, in any material adverse change in  the  business,
operations,  affairs or condition of Mach or  its  properties  or
assets,  or  that might call into question the validity  of  this
Agreement, or any action taken or to be taken pursuant hereto.

      2.08.  Title To Assets.  Mach has good and marketable title
to  all  of  its assets and properties now carried on  its  books
including those reflected in the balance sheets contained in  the
Financial  Statements,  free  and  clear  f  all  liens,  claims,
charges,  security  interests or other  encumbrances,  except  as
described in Exhibit 2.08 attached hereto or any other Exhibit.

      2.09.   Real  Estate.  There is set forth on  Exhibit  2.09
attached hereto a brief description of all real estate (including
building and improvements) owned and held by Mach, together  with
a  legal  description of such real estate.   Mach  has  good  and
marketable title to such real estate in fee simple and  clear  of
any  encumbrances  whatsoever except as  shown  on  Exhibit  2.09
hereto.

      2.10.  Contracts and Undertakings.  Mach is not in material
default, or alleged to be in material default, under any contact,
agreement,  lease, license commitment, instrument  or  obligation
and  no  other party to any contract, agreement, lease,  license,
commitment, instrument or obligation to which Mach is a party  is
in default thereunder nor does there exist any condition or event
which, after notice or lapse of time or both, would constitute  a
default  by  any  party to any such contract,  agreement,  lease,
license,  commitment, instrument or obligation.  These  contracts
and undertakings shall be delivered at Closing.

      2.11.   Underlying  Documents.   Copies  of  all  documents
described  in  any exhibit attached hereto (or a summary  of  any
such  contract, agreement or commitment, if oral) have been  made
available to Industries and are complete and correct and  include
al amendments, supplements or modifications thereto.


                              - 5 -

<PAGE>

       2.12.    Transactions  with  Affiliates,   Directors   and
Shareholders.  Except as set forth in Exhibit 2.12 hereto,  there
are and have been no contracts, agreements, arrangements or other
transactions  between  Mach on the one  hand,  and  any  officer,
director,  or  shareholder of Mach, or any corporation  or  other
entity controlled by them.

      2.13.   No  Conflict.  The execution and delivery  of  this
Agreement  and the consummation of the transactions  contemplated
hereby  will not conflict with or result in a breach of any  term
or  provision of, or constitute a default under, the Articles  of
Incorporation  or Bylaws of Mach, or any agreement,  contract  or
instrument to which Mach is a party or by which it or any of  its
assets are bound.

      2.14. Ownership of Intellectual Property Rights.  Mach owns
or  has  valid  right  or license to sue on all  patents,  patent
rights, trade secrets, trademarks, trademark rights, trade names,
trade  name  rights,  copyrights and other intellectual  property
rights   (collectively  referred  to  as  "Intellectual  property
Rights")  which  are  necessary to operate its  business  as  now
proposed  to  be operated.  Mach does not have any obligation  to
compensate any person, firm, corporation, or other entity for the
use  of  any  such  Intellectual Property Rights,  nor  has  Mach
granted  to  any  person, firm, corporation or other  entity  any
license  or  other  rights to use in any manner,  or  waived  its
rights with respect to any Intellectual Property Rights of Mach.

     2.15.  Disclosure.  To the actual knowledge of Mach, neither
this Agreement, the Financial Statements nor any other agreement,
document,  certificate or written or oral statement furnished  to
Industries  by  or  on  behalf of Mach  in  connection  with  the
transactions  contemplated hereby, contains any untrue  statement
of  a material fact which when taken as a whole omits to state  a
material fact necessary in order to make the statements contained
herein or therein not misleading.

      2.16.   Authority.  Mach has full Power  and  authority  to
enter  into  this  Agreement and to carry  out  the  transactions
contemplated  herein.   The  execution  and  delivery   of   this
Agreement  and the consummation of the transactions  contemplated
hereby,  have been duly authorized and approved by the  Board  of
Directors of Mach and no other corporate proceedings on the  part
of  Mach  are  necessary  to authorize  this  Agreement  and  the
transactions contemplated hereby.

III.  REPRESENTATIONS  AND WARRANTIES OF INDUSTRIES,  POWERBOATS,
AND POWER

      Each  of Industries, Powerboats and Power hereby represents
and warrants to Mach as follows, as of the date of this Agreement
and as of the Closing:


                              - 6 -
<PAGE>

     3.01. Organization.

           3.01(a).  Each of Industries, Powerboats, and Power is
a  corporation  duly  organized, validly existing,  and  in  good
standing  under the laws of its state of incorporation;  has  the
corporate  Power  and  authority to  carry  on  its  business  as
presently  conducted;  and is qualified to  do  business  in  all
jurisdictions were the failure to be so qualified  would  have  a
material   adverse   effect  on  the  business   of   Industries,
Powerboats, or Power.

           3.01(b).   The  copies  of the charter  documents,  of
Industries, Powerboats, and Power, as certified by the  Secretary
of  Industries,  Powerboats, and Power are complete  and  correct
copies  of  such documents as amended and in effect on  the  date
hereof. All minutes of meetings and actions in writing without  a
meeting   of   the  Boards  of  Directors  and  shareholders   of
Industries,   Powerboats  and  Power  are  contained   in   their
respective  minute  books and no minutes or  actions  in  writing
without  a  meeting have been included in such minute book  since
such delivery to Mach that have not also been delivered to Mach.

      3.02.  Capitalization.   The authorized  capital  stock  of
Industries  consists of 200,000 000 shares of common  stock,  par
value  $.01  per share, of which 3,044,072 shares are outstanding
including 10,000 shares owned by Fountain Powerboats,  Inc.   the
outstanding capital stock of Power consists of 10,000  shares  of
common  stock, par value of $1.00, all of which are  outstanding.
All outstanding shares are duly authorized, validly issued, fully
paid and non-assessable.

      3.03.   Reporting Documents.  Industries has  delivered  to
Mach  copies of its Annual Report on Form 10-K for the year ended
June  30, 1996 (the "10-K") and its quarterly report on Form 10-Q
for  the quarter ended September 30, 1996 (the "10-Q").  The 10-K
and 10-Q comply in all material respects with the requirements of
the Securities Exchange Act of 1934 (the "Exchange Act').

     3.04.  Authority.  Each of Industries, Powerboats, and Power
has full power and authority to enter into this Agreement and  to
carry  out  the transactions contemplated herein.  The  execution
and  delivery of this Agreement and the Agreement of  merger  and
the  consummation of the transactions contemplated  hereby,  have
been  duly  authorized and approved by the respective  Boards  of
Directors of Industries, Powerboats, and Power.

      3.05.   No  Conflict.  The execution and delivery  of  this
Agreement  and the consummation of the transactions  contemplated
hereby  will not conflict with or result in a breach of any  term
or  provision  of,  or constitute a default  under,  the  charter
documents or Bylaws of Industries, Powerboats, or Power,  or  any
agreement,   contract   or  instrument   to   which   Industries,
Powerboats,  or Power is a party or by which it  or  any  of  its
assets are bound.


                              - 7 -
<PAGE>

      3.06.   Disclosure.  To the actual knowledge of Industries,
Powerboats, or Power, neither this Agreement, the 10-K or the 10-
Q  nor  any other agreement, document, certificate or written  or
oral  statement furnished to Mach by or on behalf of  Industries,
Powerboats,   or  Power  in  connection  with  the   transactions
contemplated hereby, contains any untrue statement of a  material
fact  or  when  taken as a whole omits to state a  material  fact
necessary  in  order to make the statements contained  herein  or
therein not misleading.

      3.07.   Absence of Material Changes.  Since  September  30,
1996, except as described in any Exhibit hereto or as required or
permitted under this Agreement, there has not been:

            3.07(a)    any  material  change  in  the   condition
(financial  or otherwise) of the properties, assets,  liabilities
or  business of Industries, Powerboats, or Power, except  changes
in the ordinary course of business which, individually and in the
aggregate, have not been materially adverse.

           3.07(b)  any redemption, purchase or other acquisition
of  any shares of the capital stock of Industries, Powerboats, or
Power,  or  any issuance of any shares of capital  stock  or  the
granting,  issuance or exercise of any rights, warrants,  options
or  commitments by Industries, Powerboats, or Power  relating  to
their authorized or issued capital stock.

            3.07(c)    any   amendment  to  the  Certificate   of
Incorporation  of  Industries  or Articles  of  Incorporation  of
Powerboats or power.

IV.  SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS

      4.01.   All  representations, warranties and  covenants  of
Industries,  Powerboats, Power and Mach  contained  herein  shall
survive the consummation of the transactions contemplated  herein
and remain in full force and effect.

V.  CERTAIN UNDERSTANDINGS AND AGREEMENTS

       5.01   Audit  and  Appraisal.   Upon  execution  of   this
Agreement, Mach shall cooperate fully with the accounting firm of
Pritchett, Siler & Hardy to perform an audit of Mach's  financial
statements as of and for the period ending August 31,  1996  (the
"Audit").   Mach shall also cooperate fully with an appraiser  to
be  selected  by industries for the purpose of appraising  Mach's
assets as of August 31, 1996 (the "Appraisal").  the cost of  the
Audit and the Appraisal shall be borne by Industries.


                              - 8 -

<PAGE>

VI.  CONDITIONS TO CLOSING

     6.01  Conditions to Obligations of Mach.  The obligations of
Mach  under  this  Agreement shall be  subject  to  each  of  the
following conditions:

           6.01(a)  Representations and Warranties of Industries,
Powerboats,  and  Power  to  be True.   The  representations  and
warranties of Industries, Powerboats, and Power herein  contained
shall  be  true in all material respects at the Closing with  the
same  effect as though made at such time.  Industries, Powerboats
and  Power  shall  have  performed in all material  respects  all
obligations  and  complied  in all material  respects,  to  their
actual  knowledge, with all covenants and conditions required  by
this  Agreement to be performed or complied with by  them  at  or
prior to the Closing.

           6.01(b)   No  legal  Proceedings.   No  injunction  or
restraining order shall be in effect, and no action or proceeding
shall have been instituted and, at what would otherwise have been
the  Closing,  remain  pending before  a  court  to  restrain  or
prohibit the transactions contemplated by this Agreement.

            6.01(c)    Statutory  Requirements.   All   statutory
requirements   for   the   valid  consummation   by   Industries,
Powerboats,  and Power of the transactions contemplated  by  this
Agreement   shall   have  been  fulfilled.   All  authorizations,
consents  and  approvals  of all governments  and  other  persons
required  to  be  obtained  in order to  permit  consummation  by
Industries,   Powerboats,   and   Power   of   the   transactions
contemplated by this Agreement and to continue unimpaired in  all
material  respects immediately following the Closing  shall  have
been obtained.

           6.01(d)   Closing Documents.  Industries,  Powerboats,
and  Power  shall  have  executed  and  delivered  all  documents
required  to be executed and delivered by Industries, Powerboats,
and Power pursuant to this Agreement.

      6.02   Conditions to Obligations of Industries, Powerboats,
and  Power.  The obligations of Industries, Powerboats, and Power
under   this   Agreement  shall  be  subject  to  the   following
conditions:

           6.02(a)  Representations and Warranties of Mach to  be
True.    The  representations  and  warranties  of  Mach   herein
contained  shall  be  true in all material  respects  as  of  the
Closing,  and shall have the same effect as though  made  at  the
Closing;  Mach shall have performed in all material respects  all
obligations and complied in all material respects, to its  actual
knowledge,  with  all covenants and conditions required  by  this
Agreement  to  be performed or complied with by it prior  to  the
Closing.


                              - 9 -

<PAGE>

           6.02(b)   No  Legal  Proceedings.   No  injunction  or
restraining order shall be in effect prohibiting this  Agreement,
and  no  action or proceeding shall have been instituted and,  at
what would otherwise have been the Closing, remain pending before
a  court to restrain or prohibit the transactions contemplated by
this Agreement.

            6.02(c)   Statutory  and  Other  Requirements.    All
statutory requirements for the valid consummation by Mach of  the
transactions  contemplated  by this  Agreement  shall  have  been
fulfilled;  all  authorizations, consents and  approvals  of  all
Governmental agencies and authorities to be obtained in order  to
permit  consummation by Mach of the transactions contemplated  by
this Agreement shall have been obtained.

          6.02(d)  The audited Balance Sheet of Mach as of August
31,  1996  shall  reflect  net worth  (total  assets  less  total
liabilities)   of  Mach to be no less than  Six  Hundred  Thirty-
Thousand  and Forty Dollars ($630,040) after adjustment  for  the
appraised  value  of the machinery and equipment  and  after  the
reclassification of Ninety-four Thousand and Ninety-four  Dollars
($94,094) and Three Hundred and Thirty-one Thousand Seven Hundred
and  Sixty-three  Dollars  ($331,763) from  debt  owing  to  Mach
shareholders  to  equity of Mach shareholders.  It  is  expressly
understood  that  Industries, Powerboats,  and  Power  shall  not
assume  the  aforementioned indebtednesses to Mach  shareholders,
but rather, that these indebtednesses will be treated as part  of
the equity of Mach in this transaction.

VII.  TERMINATION  OF  OBLIGATIONS  AND  WAIVERS  OF  CONDITIONS;
PAYMENT OF EXPENSES

      7.01  Termination  of Agreement.  Anything  herein  to  the
contrary notwithstanding, this Agreement may be terminated at any
time before the Closing as follows and in no other manner;

            7.01(a)   Mutual  Consent.   By  mutual  consent   of
Industries, Powerboats, Power and Mach.

            7.01(b)   Expiration  Date.   By  either  Industries,
Powerboats,  Power and Mach if the Closing shall not  have  taken
place  by December 31, 1996, which date may be extended by mutual
agreement of Industries, Powerboats, Power and Mach.

      7.02.   Payment of Expenses; Waiver of Conditions.  In  the
event that this Agreement shall be terminated pursuant to Section
7.01  all  obligations of the parties under this Agreement  shall
terminate  and there shall be no liability of any  party  to  the
other.   Each  party  hereto  will pay  all  costs  and  expenses
incident to its negotiation and preparation of this Agreement and
performance of and compliance with all agreements and  conditions
contained  herein  or  therein on its part  to  be  performed  or
complied with, including the fees, expenses and disbursements  of
counsel.

                             - 10 -
<PAGE>

If any of the conditions specified in Section 6.01 hereof has not
been  satisfied,  Mach may nevertheless a the  election  of  Mach
proceed with the transactions contemplated hereby and if  any  of
the  conditions  specified in Section 6.02 hereof  has  not  been
satisfied, Industries, Powerboats, and Power may nevertheless  at
their  joint  election proceed with the transactions contemplated
hereby.  In the event that the Closing shall be consummated, each
party hereto will pay all of its costs and expenses in connection
therewith.


XIII. MISCELLANEOUS

      8.01   Finder's  Fees,  Investment Banking  Fees.   Neither
Industries, Powerboats, Power nor Mach have retained or used  the
services of any person, firm or corporation in such manner as  to
require  the payment of any compensation as a finder or a  broker
in connection with the transactions contemplated herein.

     8.02  Tax Treatment.  The transaction contemplated hereby is
intended  to  qualify  as  a so-called "tax-free"  reorganization
under the provisions of Section 368 of the Internal Revenue Code.
Industries, Powerboats, Power and Mach acknowledge, however, that
they  each  have  been represented by their own tax  advisors  in
connection  with this transaction; that they have  not  made  any
representations or warranties to the others with respect  to  the
tax  treatment  of such transaction or the effect  thereof  under
applicable tax laws, regulations, or interpretations; and that no
attorney's  opinion or private revenue ruling has  been  obtained
with  respect  to the effects thereof under the Internal  Revenue
Code of 1986, as amended.

      8.03   Further Assurances.  From time to time, at the other
party's  request and without further consideration, each  of  the
parties will execute and deliver to the others such documents and
take  such  action as the other party may reasonably  request  in
order   to   consummate   more   effectively   the   transactions
contemplated hereby.

      8.04   Parties in Interest.   Except as otherwise expressly
provided  herein, all the terms and provisions of this  Agreement
shall be binding upon, shall inure to the benefit of and shall be
enforceable by the respective heirs, beneficiaries, personal  and
legal  representatives,  successors and assigns  of  the  parties
hereto.

       8.05    Entire  Agreement;  Amendments.   This  Agreement,
including  the  schedules,  Exhibits  and  other  documents   and
writings  referred to herein or delivered pursuant hereto,  which
form  a  part  hereof, contains the entire understanding  of  the
parties  with  respect  to this subject  matter.   There  are  no
restrictions,  agreements,  promises,  warranties,  covenants  or
undertakings other than those


                             - 11 -
<PAGE>

expressly set forth herein or therein.  This Agreement supersedes
all  prior agreements and understandings between the parties with
respect  to  this subject matter.  This Agreement may be  amended
only  by  a  written instrument duly executed by the  parties  or
their respective successors or assigns.

      8.06   Headings,  Etc.  The section and paragraph  headings
contained in this Agreement are for reference purposes  only  and
shall  not  affect  in any way the meaning or interpretations  of
this Agreement.

      8.07   Pronouns.   All pronouns and any variations  thereof
shall  be  deemed to refer to the masculine, feminine or  neuter,
singular  or  plural,  as the identity of  the  person,  persons,
entity or entities may require.

      8.08   Counterparts.  this Agreement  may  be  executed  in
several  counterparts, each of which shall be deemed an  original
but  all  of  which together shall constitute one  and  the  same
instrument.

      8.09   Governing Law.  This Agreement shall be governed  by
the  laws  of the State of North Carolina applicable to contracts
to be performed in the State of North Carolina.

      IN  WITNESS WHEREOF, this Agreement has been duly  executed
and  delivered  by  the parties hereto as the  date  first  above
written.

FOUNTAIN POWERBOAT                MACH PERFORMANCE, INC.
  INDUSTRIES, INC.
FOUNTAIN POWERBOATS, INC.




/S/REGINALD M. FOUNTAIN, JR.      /S/GARY D. GARBRECHT
Reginald M. Fountain, Jr.         Gary D. Garbrecht
Chairman, President               Chairman, President, and
Chief Executive officer,          Chief Executive Officer
and Chief Operating Officer


FOUNTAIN POWER, INC.



/S/GARY D. GARBRECHT
Gary D. Garbrecht
President and Chief
Operating Officer

                             - 12 -
<PAGE>

      I  HEREBY  CERTIFY that I am the duly elected and qualified
secretary  of  MACH PERFORMANCE, INC., a Florida corporation  and
the keeper of the records and corporate seal of said corporation;
that  the following is a resolution duly adopted at a meeting  of
the  Board of Directors thereof held in accordance with  its  by-
laws at its offices at Lake Hamilton, Florida on the _____ day of
________, 1996, and that the same are now in full force.

                           Resolution

       "BE   IT   RESOLVED,   That   the   President   and   Vice
President/Secretary/Treasurer of this  corporation,  as  well  as
Gary  Garbrecht, individually and Marcia Garbrecht,  individually
the owners of all the shares of the corporation, hereby agree  to
the   merger   of   this  corporation  with  Fountain   Powerboat
Industries, Inc.

      I HEREBY CERTIFY that the following named persons have been
duly  elected to the offices set opposite their respective names,
that they continue to hold these offices at the present time, and
that  the  signatures appearing hereon are the genuine,  original
signatures of each respectively:



GARY GARBRECHT
President/                          /S/GARY D. GARBRECHT
Shareholder                        (signature)


MARCIA GARBRECHT
Vice President
Secretary/Treasurer/                /S/MARCIA GARBRECHT
Shareholder                        (signature)

      IN  WITNESS  WHEREOF, I have hereunto affixed  by  name  as
secretary  and have caused the corporate seal of said corporation
to be hereto affixed this 19th day of March, 1997.


                                   /S/MARCIA GARBRECHT
                                   MARCIA GARBRECHT
                                   Secretary
fountain\cooperative.cr

<PAGE>

CORPORATE RESOLUTION
                                
      I  HEREBY  CERTIFY that I am the duly elected and qualified
secretary  of  MACH PERFORMANCE, INC., A Florida corporation  and
the keeper of the records and corporate seal of said corporation;
that  the following is a resolution duly adopted at a meeting  of
the  Board of Directors thereof held in accordance with  its  by-
laws at its offices at Lake Hamilton, Florida on the ____ day  of
_____, 1996, and that the same are now in full force.

                           Resolution
                                
      "BE  IT  RESOLVED,  That the Board  of  Directors  of  Mach
Performance,  Inc.  and its shareholders  have  duly  elected  as
members  of  Mach  Performance, Inc.'s  Board  of  Directors  the
following person as directors and officers:

          Reginald M Fountain, Jr.      - Chairman of the Board
          Gary D. Garbrecht             - Director
          Gary E. Mazza, III            - Director
          Federico Pignatelli           - Director
          Mark L. Spencer               - Director
          Reginald M. Fountain, Jr.     - Chief Executive Officer
          Gary D. Garbrecht             - President
          Allan L. Krehbiel             - Vice President and Chief
                                          Financial Officer
          Blanche C. Williams           - Secretary & Treasurer
          Carol J. Price                - Assistant Secretary

      I HEREBY CERTIFY that the following named persons have been
duly  elected to the offices set opposite their respective names,
that they continue to hold these offices at the present time, and
that  the  signatures appearing hereon are the  genuine  original
signatures of each respectively:


GARY GARBRECHT
President                          /S/GARY GARBRECHT
                                   (signature)

MARCIA GARBRECHT
Vice President
Secretary/Treasurer                /S/MARCIA GARBRECHT
                                   (signature)

      IN  WITNESS  WHEREOF, I have hereunto affixed  by  name  as
secretary  and have caused the corporate seal of said corporation
to be hereto affixed this 19th day of March, 1997.


                                   /S/MARCIA GARBRECHT
                                   MARCIA GARBRECHT
                                   Secretary

fountain\cooperative.cr2


<PAGE>
                          EXHIBIT 1.01
                                
                       ARTICLES OF MERGER

      THESE ARTICLES OF MERGER, dated as of October 11, 1996, are
entered  into by and between Mach Performance, Inc.  ("Mach"),  a
Florida  corporation,  Fountain Power, Inc.  ("Power"),  a  North
Carolina corporation, Fountain Powerboats, Inc. ("Powerboats"), a
North  Carolina  corporation, and Fountain Powerboat  Industries,
Inc.  ("Industries"),  a  Nevada Corporation,  such  corporations
being  hereinafter collectively referred to as  the  "Constituent
Corporations."  Power is sometimes hereinafter referred to as the
"Surviving Corporation."  These Articles of Merger set forth  the
Plan  of  Merger  described  in Section  55-11-01  of  the  North
Carolina Business Corporation act.

                            RECITALS

      A.   Industries is a Nevada corporation authorized to issue
200,000,000   shares  of  common  stock  $.01  par   value   (the
"Industries Common Stock"), of which 3,044,072 shares are  issued
and outstanding at the date hereof.

     B.  Mach is a Florida corporation authorized to issue 10,000
shares  of  common  stock,  $1.00 par  value  (the  "Mach  Common
Stock"), of which 5,465 shares are issued and outstanding  as  of
the date hereof.

      C.  Industries owns all of the capital stock of Powerboats,
which, in turn, owns all of the capital stock of Power.

      D.   The  respective Boards of Directors  of  each  of  the
Constituent  Corporation  deem  it  advisable  and  in  the  best
interests  of  the  respective corporations and their  respective
shareholders that Mach be merged with and into Power on the terms
and  conditions  hereinafter set forth  in  accordance  with  the
provisions   of  Sections  55-11-01  and  55-11-03  to   55-11-05
inclusive of the North Carolina Business Corporation Act.

      E.   On  October 11, 1996, the Board of Directors of  Power
adopted  the following resolution, which resolution has not  been
amended or revoked and is in full force and effect as of the date
hereof,  and  which resolution constitutes all approval  required
for  the merger of Mach with and into Power under Sections 55-11-
01  and  55-11-03  to  55-11-05 inclusive of the  North  Carolina
Business Corporation Act:

      RESOLVED,  That Power merge with and into Mach  with  Power
being  the surviving corporation, pursuant to Articles of  Merger
to be executed and acknowledged by Power.

     F.  The merger of Mach into Power was approved by Industries
and   Powerboats,  and  Powerboats  holds  all  of   the   10,000
outstanding shares of Power common stock, which is the only class
of stock outstanding, acting by consent action in accordance with
Section 55-7-04 of the North Carolina Business Corporation Act.


                             - 13 -
<PAGE>

      G.   By execution these Articles of merger, then merger  of
Mach  with  and into Power has been approved, in accordance  with
Section 55-11-03(b0(2) of the North Carolina Business Corporation
Act.

      H.   On  October 11, 1996, the Board of Directors  of  Mach
adopted  the following resolution, which resolution has not  been
amended or revoked and is in full force and effect as of the date
hereof.

      RESOLVED,  that Mach merge with and into Power, with  Power
being  the surviving corporation, pursuant to Articles of  Merger
to be executed and acknowledged by Mach.

       I.   The  merger  of  Mach  into  Power  was  approved  by
shareholders holding all of the outstanding shares of Mach common
stock,  which is the only class of stock outstanding,  acting  by
consent  action in accordance with Section 55-7-04 of  the  North
Carolina business Corporation Act.

      J.   By  execution and acknowledgment of these Articles  of
Merger,  the merger of Mach with and into Power has been approved
in accordance with the North Carolina Business Corporation Act.

      NOW,  THEREFORE, in order to prescribe (a)  the  terms  and
conditions of the Merger; (b) to method of carrying the same into
effect; (c) the manner and basis of converting and exchanging the
shares  of  Mach's Common Stock into shares of  Common  Stock  of
Industries;  and  (d) such other details and  provisions  as  are
deemed  necessary  or  desirable; and  in  consideration  of  the
foregoing  recitals and the agreements, provisions and  covenants
herein  contained, Industries, Powerboats, Power and Mach  hereby
agree as follows:

      1.  Effective Date.  The Merger shall become effective upon
the  filing  of  a  copy of these Articles  of  Merger  with  the
Secretary of State of North Carolina, as required by Section  55-
11-05  of the North Carolina Business Corporation Act.  The  date
and  time  on  which the Merger becomes effective is  hereinafter
referred to as the "Effective Date."

      2.   Merger.  At the Effective Date, Mach shall merger with
and  into  Power with Power being  the Surviving Corporation  and
the  separate  corporate  existence of  Mach  shall  cease.   The
corporate  identity,  existence,  purposes,  franchises,  powers,
rights  and  immunities of Mach at the Effective  Date  shall  be
merged  into Power which shall be fully vested therewith.   Power
shall  be subject to all of the debts and liabilities of Mach  as
if power had itself incurred them and all rights of creditors and
all  liens  upon the property of each of Mach and Power  shall  e
preserved unimpaired, provided that such liens, if any, upon  the
property  of  Power  shall be limited to  the  property  affected
thereby immediately prior to the Effective Date.


                             - 14 -
<PAGE>

      3.   Articles of Incorporation.  At the Effective Date, the
Articles  of  Incorporation of Power shall  be  the  Articles  of
Incorporation of the Surviving Corporation.

     4.  Effect of Merger on Outstanding Shares.

          (a)  Surviving Corporation.  Each share of Power Common
Stock  issued and outstanding immediately prior to the  Effective
Date of the Merger shall continue to be outstanding.

           (b)  Disappearing Corporation.  At the Effective Date,
each  issued and outstanding share of Mach Common Stock shall  be
cancelled.

      5.   Surrender of Share Certificates.  After the  Effective
Date,  each holder of an outstanding certificate which  prior  to
the  Effective  Date evidenced Mach Common Stock shall  surrender
the  same,  duly endorsed as Power may require, to Industries  or
its   designated   agent   for   cancellation.    Thereupon   the
shareholders  of  Mach shall receive in exchange therefor  85,000
restricted  common  shares  of  Industries  as  provided  in  the
Agreement and Plan of Reorganization of October 11, 1996.

     6.  Status of Power Common Stock After the Effective Date.

           (a)   After  the Effective Date, until surrendered  in
accordance  with  Section 5 hereof, each outstanding  certificate
which  prior  to  the Effective Date represented shares  of  Mach
Common Stock, shall be deemed for all corporate purposes (subject
to  the further provision of this Section 6(a) to evidence  Power
Common  Stock  in accordance with the terms of this Agreement  of
merger.   After  the Effective Date, there shall  be  no  further
registry  of  transfers  on  the records  of  Mach  common  Stock
outstanding  immediately  prior to the Effective  Date,  and,  if
certificates representing such shares are presented to  Power  or
Industries,  as the successor of Mach, they shall  be  cancelled,
and  the  holder thereof shall be entitled to receive  Industries
Common  Stock  in accordance with the terms of the Agreement  and
plan  of  Reorganization of October 11, 1996.   No  dividends  or
distributions  will  be  paid  to  persons  entitled  to  receive
certificates  for  shares of Industries Common Stock  until  such
persons   shall   have  surrendered  their  Mach   Common   Stock
certificates  in  accordance  with Section  5  hereof;  provided,
however,  that  when  such  certificates  shall  have   been   so
surrendered  in exchange for shares of Industries  Common  Stock,
there  shall be paid to the holders thereof, but without interest
thereon  all dividends and other distributions payable subsequent
to  and  in respect of a record date after the Effective Date  on
the shares of Industries Common Stock for which such certificates
shall have been so exchanged.  Holders of certificates for shares
of  Mach  Common Stock shall not be entitled, as such, to receive
any   dividends  unless  and  until  they  have  exchanged  those
certificates  representing shares of Industries Common  Stock  as
provided herein.

                             - 15 -
<PAGE>

           (b)  If any certificates of Industries Common Stock is
to  be  issued in a name other than that in which the certificate
for  the Mach Common Stock surrendered in exchange is registered,
it  shall be a condition of such exchange that the certificate so
surrendered  shall be properly endorsed and otherwise  in  proper
form  for  transfer and that the person requesting such  exchange
shall  (i) pay any transfer or other taxes required by reason  of
the  issuance of such Industries Common Stock in any  name  other
than that of the registered holder of the certificate surrendered
or (ii) establish to the satisfaction of Power or Industries that
such tax has been paid or is not applicable.

     7.  Other Provisions.

           (a)   Governing Law; Entire Agreement.  These Articles
of  Merger shall be governed by and construed in accordance  with
the  laws  of  the  State of North Carolina.  These  Articles  of
Merger  contain the entire agreement of the parties  hereto,  and
supersede  any  prior  written or oral  agreements  between  them
concerning the subject matter contained herein.

           (b)   Counterparts.  These Articles of merger  may  be
executed in any number of counter parts and each such counterpart
shall  be  deemed to be an original instrument, but all  of  such
counterparts together shall constitute but one agreement.

           (c)  Further Assurances.  Each Constituent Corporation
shall from time to time upon the request of the other Constituent
Corporation,  execute and deliver and file and  record  all  such
documents and instruments and take all such other actions as such
corporation may request in order to vest or evidence the  vesting
in  Power  of  title to and possession of all rights, properties,
assets  and  business of Power to the extent provided herein,  or
otherwise  to  carry  out the full intent and  purpose  of  these
Articles of Merger.

           IN  WITNESS  WHEREOF, the parties hereto  have  caused
these  Articles  of  merger  to be  executed  on  behalf  of  the
Constituent  Corporations as of the date  and  year  first  above
written.

MACH PERFORMANCE, INC.             FOUNTAIN POWER, INC.



/S/GARY D. GARBRECHT               /S/GARY D. GARBRECHT
Gary D. Garbrecht                  Gary D. Garbrecht
President                          President

FOUNTAIN POWERBOAT INDUSTRIES, INC.
FOUNTAIN POWERBOATS, INC.


/S/REGINALD M. FOUNTAIN, JR.
Reginald M. Fountain, Jr.
President
                             - 16 -

<PAGE>
                          Exhibit 1.02
                                
                      EMPLOYMENT AGREEMENT


      This Employment Agreement ("Agreement") is entered into  as
of  October 11, 1996, between Fountain Powerboats, Inc., a  North
Carolina   corporation   ("Company")  and   Gary   D.   Garbrecht
("Employee").

                      W I T N E S S E T H:

     WHEREAS, Employee possess unique talents of unusual value to
Company; and

      WHEREAS, concurrently with the execution of this Agreement,
Fountain   Powerboat  Industries,  Inc.,  Company's  parent,   is
acquiring  all  of  the capital stock of Mach  Performance,  Inc.
("Mach")  by  merger of Mach into Company's subsidiary,  Fountain
Power, Inc.; and

      WHEREAS,  Company recognizes that Employee's  services  are
peculiarly  valuable  to  Company and  therefore  is  willing  to
provide  Employee  with  the  rights, benefits  and  compensation
provided for herein so as to secure the services of Employee  for
the duration of this Agreement on the terms provided herein;

     NOW THEREFORE, the parties hereto agree as follows:

      1.   Employment.  Company hereby hires Employee to  perform
the  duties and render the services hereinafter set forth  for  a
period of four (4) years from the date of this Agreement, subject
to  earlier  termination as herein provided, and Employee  hereby
accepts  such  employment and agrees faithfully to  perform  such
services during the term of this Agreement.

       2.   Duties.   Employee  agrees  as  President  and  Chief
Operating Officer of Company's subsidiary, Fountain Power,  Inc.,
and  to perform such duties as may be reasonably required of  him
in such capacity with Company.

      3.  Exclusive Service.  Employee agrees that he will devote
all  of his time and efforts to this employment and apply all  of
his  skill  and experience to the performance of his duties,  and
that  during the term of this Agreement, except with the  written
approval  of Company, Employee will not engage in, or be employed
in, any other business except as a passive investor, and Employee
will otherwise do nothing inconsistent with his duties hereunder.

     4.  Compensation.  In consideration of the foregoing and for
all  the  services  to be rendered by Employee pursuant  thereto,
Employee shall receive a salary of Ten Thousand Dollars ($10,000)
per   month,  payable  weekly  in  accordance  with  the  payroll
practices


                             - 17 -
<PAGE>

of  Company which may be in effect from time to time, and subject
to  such withholding as is required by law.  In addition, Company
shall  reimburse  Employee  for  all  reasonable  and  documented
business expenses.   As an employee of Company, Employee will  be
entitled  to  participate in all benefit plans  as  they  may  be
offered  from  time  to time by company to  its  other  executive
employees.   Employee shall be entitled to all other compensation
increases,  perquisites, and benefits as may be  determined  from
time  to  time by the Board of Directors.  Employee shall receive
an  annual  bonus  equal to one percent (1%) of the  consolidated
pretax  net  income of Fountain Powerboats, Inc.  payable  within
ninety  days  after  the fiscal year-end.   Employee  shall  also
receive  a  Seven  Hundred Dollars ($700)  per  month  automobile
allowance  after  the auto lease assumed in the Mach  acquisition
expires.   A  monthly housing allowance incident  to   Employee's
relocation to North Carolina will be paid for up to one year from
the  date  of  this  Agreement or until  the  Employee's  Florida
residence  is  sold,  whichever come sooner,  equivalent  to  the
Employee's  current  monthly  home mortgage  payment  amount,  or
$4,030.72.   Employee shall also be granted the  following  stock
options under the Employee Incentive Stock Option Plan of 1986:

     October 11, 1997 - 5,000 shares at $12.25 per share, and
     October 11, 1998 - 5,000 shares at $12.25 per share, and
     October 11, 1999 - 5,000 shares at $12.25 per share, and
     October 11, 2000 - 5,000 shares at $12.25 per share,

The  foregoing options shall be exercisable in whole or  in  part
for  a  period  of  ten  years from the  date  of  grant  and  be
immediately vested to the Employee and exercisable b him  whether
or  not  he  is  an employee at the time of the exercise  of  the
option.

     5.  Termination.  This Agreement shall terminate immediately
upon  termination  for  cause  or  the  death  or  disability  of
Employee.   For purpose of this Agreement, the term  "disability"
shall  mean the inability of Employee, due to mental or  physical
illness or injury, to perform his duty as an employee of Company,
and  the  term "termination for cause" shall mean termination  of
Employee  by the Board of Directors on account of his refusal  to
perform  duties  assigned to him, or breach by  Employee  of  the
covenant  contained  in Section 6 hereof.  This  Agreement  shall
also  terminate  immediately upon any  voluntary  resignation  of
Employee.

     6.  Non-Competition.  During the term of this Agreement, and
for  one year after termination of this Agreement, Employee shall
not,  either  directly  or indirectly,  either  as  an  employee,
employer,  consultant,  agent, principal,  partner,  stockholder,
officer  or  director, engage or participate in any  business  in
competition with that of Company.


                             - 18 -
<PAGE>

      7.   Disclosure of Information.  Employee agrees not at any
time (during or after the term of this Agreement) to disclose  or
use,  except  in  pursuit of the business of Company  or  of  any
affiliate  of Company, an Proprietary Information of Company,  or
of  any  affiliate of Company, acquired during the term  of  this
Agreement.     For   purposes  of  this  Agreement   the   phrase
(Proprietary Information: means all information which is known or
intended  to  be known only to Employee or employees of  Company,
except in pursuit of the business of Company any document, record
or  other  information of company, or others  in  a  confidential
relationship  with  Company, and  relates  to  specific  business
matters  such  as  patents, patent applications,  trade  secrets,
secret processes, proprietary know-how, information  relating the
Company's  business, and identity of suppliers  or  customers  or
accounting procedures of Company, or relates to other business of
Company,  Employee  agrees not to remove  from  the  premises  of
Company, except in pursuit of the business of company, or of  any
affiliate  of Company, any document, record or other  information
of Company.  Employee recognizes that all such documents, records
or other information, whether developed by Employee or by someone
else for company, are the exclusive property of company.

       8.    Proprietary   Information   of   Others.    Employee
acknowledges that from time to time Company may do business  with
suppliers  or customers who will supply Company with  information
of a confidential nature, and that Company may have a contractual
obligation  to  preserve  the confidential  nature  of  any  such
information.   Employee agrees to treat any information  received
from  suppliers or customers as confidential, and as if  it  were
the  Proprietary Information of Company, unless advised otherwise
by the Chief Executive Officer of Company.

      9.   Remedies.   In  addition to any other  remedies  which
Company  may  have by virtue of this Agreement,  Employee  agrees
that in the event a breach of the obligations of confidence under
this  Agreement  are  threatened, Company shall  be  entitled  to
obtain  a  temporary restraining order and preliminary injunction
against Employee to restrain any breach of confidence or covenant
not to compete under this Agreement.

      10.  Term; Renewal.  This Agreement shall automatically  be
renewed for successive terms of one (1) year at the expiration of
the  term set forth in Section 1 hereof, unless either the  Board
of  Directors or Employee shall give written notice to the  other
of  its  or  his intention not to renew this Agreement  at  least
ninety  (90) days prior to the expiration of such term or renewed
term.

      11.  Assignment.  This Agreement shall inure to the benefit
of  and  shall be binding upon the successors and the assigns  of
Company.  since this Agreement is based upon the unique abilities
and  personal confidence in Employee, he shall have no  right  to
assign this Agreement or any of the rights hereunder.


                             - 19 -
<PAGE>

      12.   Prior  Contracts.   Any prior contract  or  agreement
between  Company  and  Employee regarding  employment  is  hereby
cancelled and shall be of no further force and effect.

     13.  Severability.  If any provision of this Agreement shall
be  found  invalid  by any court of competent jurisdiction,  such
findings  shall  not affect the validity of the other  provisions
hereof  and the invalid provisions shall be deemed to  have  been
severed herefrom.

     14.  Waiver of Breach.  The waiver by company or Employee of
the  breach of any provision of this Agreement by the other party
or  the  failure to exercise by company or Employee of any  right
granted hereunder shall not operate or be construed as the waiver
of any subsequent breach by the other party not the waiver of the
right to exercise any such right.

      15.  Entire Agreement.  This instrument contains the entire
agreement of the parties, and may be amended only by an agreement
in writing signed by the parties.

      16.   Notice.  Any notice required or permitted to be given
under  this  Agreement shall be sufficient if in writing  and  if
sent  by  certified mail to his residence, in  the  case  of  the
Employee, or to its principal office, in the case of the Company.

      17.   Governing  Law.  This Agreement is entered  into  and
executed in the State of North Carolina and shall be governed  by
the  laws of such state.  In the event of any proceeding  brought
to enforce the provisions of this Agreement, the prevailing party
shall  be  entitled  to  costs of suit and  attorneys'  fees,  in
addition to other remedies available.

      IN  WITNESS  WHEREOF, the parties hereto have hereunto  set
their hands as of the day and year first above written.


FOUNTAIN POWERBOATS, INC.          EMPLOYEE




/S/R.M. FOUNTAIN, JR.              /S/GARY D. GARBRECHT
R.M. Fountain, Jr.                 Gary D. Garbrecht
Chairman, President, Chief
Executive Officer, and Chief
Operating Officer



                             - 20 -

<PAGE>

                        Mach Exhibit 2.03
                                
                  Subsidiaries and Investments
                                
                                
                                
                                
                              None
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                             - 21 -

<PAGE>
                      Mach Exhibit 2.02(a)
                                
                         Capitalization
                                
                                
                                
Class                 Authorized                  Outstanding


Common             10,000 shares                  5,465 shares













































                             - 22 -
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                      Mach Exhibit 2.02(b)
                                
                      Options and Warrants
                                
                                
                                
                                
                              None
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                             - 23 -
<PAGE>

                        Mach Exhibit 2.05
                                
                     Undisclosed Liabilities
                                
                                
                                
                                
                              None
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                             - 24 -
<PAGE>

                        Mach Exhibit 2.07
                                
                           Litigation
                                
                                
                                
                                
                              None
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                             - 25 -

<PAGE>
                        Mach Exhibit 2.08
                                
                         Title to Assets
                                
                                
                                
                                
                              None
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                             - 26 -

<PAGE>
                        Mach Exhibit 2.09
                                
                           Real Estate
                                
                                
                                
                                
                              None
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                             - 27 -

<PAGE>
                        Mach Exhibit 2.12
                                
                     Interested Transactions
                                
                                
                                
                                
                              None
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                             - 28 -

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