Summary of Permitted Indebtedness, Commitments from Banks,
                       and Availability at March 31, 2000
                                 (in thousands)


Capitalized  terms not  otherwise  defined in this summary are defined as in the
Indenture.

Pursuant to Section 4.10 of the  Indenture  between  International  Knife & Saw,
Inc.  (the  "Company")  and United  States Trust Company of New York as Trustee,
dated  November 6, 1996,  the Company shall not incur directly or indirectly any
Indebtedness  unless  certain  cash flow  coverage  ratios  are  achieved.  This
limitation, however, does not apply to Permitted Indebtedness.

Permitted  Indebtedness  includes  Indebtedness of the Company arising under the
Senior  Credit  Facility  and  Indebtedness  of IKS  Klingelnberg  GmbH  and its
Subsidiaries  arising under the German  Subsidiary  Facilities,  in an aggregate
principal  amount  not to  exceed at any time  outstanding  the  greater  of (x)
$30,000,  less any permanent  reduction in commitments  thereunder,  and (y) the
sum, at such time,  of (i) 85% of the  consolidated  book value of net  accounts
receivable of the Company and the  Restricted  Subsidiaries  and (ii) 60% of the
consolidated  book  value  of  inventory  of  the  Company  and  the  Restricted
Subsidiaries.

According to the formula referred to above,  Permitted Indebtedness at March 31,
2000 is equal to $42,884.  The Company has commitments  from banks in the amount
of $40,002. These commitments are broken down as follows:

Deutsche Bank AG has provided a $13,000 line of credit to International  Knife &
Saw, Inc. under the Senior Credit Facility. This facility was initially $20,000,
but was modified and partially  replaced with the unsecured  line of credit from
the Fifth Third Bank of Northern Kentucky,  Inc. As of March 31, 2000, $2,859 of
the Senior Credit Facility was used and $10,141 was unused.  Collateral for this
facility  includes  inventories  and  accounts  receivable.  Covenants  for this
facility  are  described in the letter  agreement  with  Deutsche  Bank AG dated
October 8, 1996.  This letter  agreement was filed by the Company in its Amended
Registration  Statement  on Form S-4  filed  with the  Securities  and  Exchange
Commission on January 28, 1997.

Fifth Third Bank of Northern  Kentucky,  Inc. has  provided an unsecured  $1,500
line of credit to  International  Knife & Saw,  Inc.  This  facility  replaced a
portion  of the  Senior  Credit  Facility.  As of March 31,  2000,  $775 of this
facility was used and $725 was unused.

Deutsche  Bank AG has  provided  a DEM  68,000  ($33,275)  line of credit to IKS
Klingelnberg  GmbH  ("GmbH")  under  the  German  Subsidiary  facilities.  These
facilities  encompass  a) a guarantee by Deutsche  Bank AG of GmbH's  promissory
note in the  amount  of DEM  3,599  ($1,761)  to a former  owner of the  Diacarb
company (this debt has been incurred  pursuant to section  4.10(b)(xiii)  of the
Indenture);  b) assumed debt, for


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which GmbH serves as guarantor,  in the amount of ATS 44,000  (approximately DEM
5,718 or $2,798) on the books of and in connection  with GmbH's  acquisition  of
Boehler Miller Messer und Saegen GmbH in January 2000; c)  Indebtedness  of GmbH
which was outstanding on the Issue Date in the amount of approximately DEM 6,566
($3,213); and d) a general line of credit in the amount of DEM 52,117 ($25,503).
Of this  general  line of credit in the  amount of DEM 52,117  ($25,503),  as of
March 31,  2000,  DEM 35,826  ($17,531)  of the facility was used and DEM 16,291
($7,972) was unused. Collateral and covenants for this facility are described in
the letter  agreement  with Deutsche Bank AG dated October 8, 1996.  This letter
agreement was filed by the Company in its Amended Registration Statement on Form
S-4 filed with the Securities and Exchange Commission on January 28, 1997.


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