FOUNTAIN POWERBOAT INDUSTRIES INC
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>fountain901exhibit.txt
<TEXT>
STATE OF NORTH CAROLINA
COUNTY OF BEAUFORT

                                           STOCK OPTION AGREEMENT

          THIS  STOCK OPTION AGREEMENT (the "Agreement") is made as of this
  day  of  February,  2001 (the "Date of Grant"), by and  between  FOUNTAIN
POWERBOAT INDUSTRIES, INC., a Nevada corporation (the "Company"), and DAVID
L. WOODS, a resident of Counce, Tennessee  (the "Optionee").

          WHEREAS, the Company's Board of Directors has approved the  grant
to  the  Optionee  of an option to purchase shares of the Company's  common
stock  ("Common  Stock")  and  desires to  enter  into  this  Stock  Option
Agreement to set forth the terms and conditions of that option.

          NOW,  THEREFORE,  in  consideration  of  the  premises  and   the
agreements of the parties set forth herein, and for valuable consideration,
the receipt of which hereby is acknowledged by the Company, the Company and
the Optionee hereby agree as follow:

     1.    Grant  of  Option.  Pursuant to and subject  to  the  terms  and
conditions  contained in this Agreement, the Company hereby grants  to  the
Optionee  the right and option (the "Option") to purchase from the  Company
all  or  any number of an aggregate of TWENTY-FIVE THOUSAND (25,000) shares
of  Common Stock (the "Option Stock") which may be authorized but  unissued
shares  or shares acquired by the Company on the open market or in  private
transactions.

     2.    Date  of  Grant of Option.  For purposes of this Agreement,  the
Option is granted effective as of the date of this Agreement (the "Date  of
Grant").

     3.    Exercise  Price.  The price to be paid by the Optionee  for  the
purchase of the Option Stock upon exercise of the Option shall be  ONE  AND
344/1000s DOLLARS ($1.344) per share (the "Exercise Price").

     4.   Exercise Schedule.  Subject to any further restrictions contained
in  this  Agreement, the Option will become exercisable  on  the  following
dates as to the indicated number of shares of the Option Stock:

                                        Option Stock
                      Date          Available For Exercise

             December 31, 2001          12,500 shares

             December 31, 2002          12,500 shares

     Notwithstanding anything contained herein to the contrary, the  Option
may not be exercised at any time as to a fractional share.

     5.    Method of Exercise.  To exercise the Option in whole or in part,
the  Optionee  must deliver written notice of such exercise (a  "Notice  of
Exercise")  to  the  President or Secretary of the Company.   Such  written
notice shall be substantially in the form attached hereto as Exhibit A  and
shall  specify  the number of shares of Option Stock to  be  purchased.   A
Notice  of Exercise shall not be effective (and the Company shall  have  no
obligation  to  sell  any  Option Stock to the Optionee  pursuant  to  such
Notice)  unless  it  satisfies the terms and conditions contained  in  this
Agreement  and actually is received by the Company prior to its  expiration
or earlier termination as specified herein.

          Notwithstanding  anything contained herein to the  contrary,  the
Optionee  may  not  exercise the Option to purchase less than  one  hundred
(100) shares, unless the Company's Board of Directors otherwise approves or
unless  the  partial exercise is for all remaining shares of  Option  Stock
available under the Option.  As soon as practicable following receipt  from
the  Optionee of a valid and effective Notice of Exercise and full  payment
of  the  Exercise Price relating to a number of the shares of Option  Stock
being  purchased,  a stock certificate representing that number  of  shares
shall  be  issued  and delivered by the Company to the Optionee;  provided,
however,  that the Company shall have the right and discretion to hold  any
shares  purchased upon exercise of the Option in escrow for a period ending
on  the  date  one year following the date of  issuance of the  stock  upon
exercise of the Option.  During any such escrow period, the Optionee  shall
have  all  rights  of  a  shareholder with  respect  to  the  Option  Stock
purchased,  including but not limited to the right to vote and  to  receive
dividends on such stock.

     6.   Payment.  The Exercise Price of Option Stock being purchased upon
an  exercise  of  the Option (in part or in whole) shall  be  paid  by  the
Optionee in full at the time of such exercise.  Such payment shall be  made
in  the form of cash, or in such other manner as shall be acceptable to the
Company, and shall accompany the Notice of Exercise.  The Option shall  not
be  considered to have been properly exercised as to any Option Stock,  and
no  Option  Stock shall be issued or delivered, until full payment  of  the
Exercise Price therefor has been made.

     7.    Expiration of Option.  Notwithstanding anything contained herein
to  the  contrary, to the extent the Option shall not previously have  been
exercised in the manner required by or otherwise terminated as provided  in
this Agreement, it shall expire and terminate at 5:00 P.M. on December  12,
2007 (the "Expiration Date").  Upon the expiration of all or any portion of
the  Option,  it  shall,  without any further act by  the  Company  or  the
Optionee, no longer be exercisable or of any force or effect and  shall  no
longer  confer any rights to any person to purchase shares of Common  Stock
under this Agreement.

     8.    Effect  of  Agreement  on Service as a Director.   Neither  this
Agreement  nor the grant of the Option is intended or shall  be  deemed  or
interpreted  to  confer upon the Optionee any right to  be renominated  for
election  as  a  director  of the Company or to  continue  to  serve  as  a
director.

     9.    Rights  as  a Shareholder.  Neither the Optionee nor  any  other
person shall have any rights as a stockholder with respect to any shares of
Option  Stock  until the Option has been validly exercised  in  the  manner
described  in this Agreement, full payment of the Exercise Price  has  been
made for such shares, and a stock certificate representing the Option Stock
purchased  upon  such exercise has been registered on the  Company's  stock
records  in  the  name  of and delivered to the Optionee  or  other  person
entitled thereto.  Except to the extent of adjustments made as described in
this  Agreement, no adjustment on behalf of the Optionee shall be made  for
dividends (ordinary or extraordinary, whether in cash, securities or  other
property),  distributions or other rights for which  the  record  date  for
determining the shareholders entitled to receive the same is prior  to  the
date  of registration and delivery of the stock certificate(s) representing
the Option Stock.

     10.  Adjustment of Options.

          (a)   Changes in Capitalization; Stock Splits and Dividends.   In
the  event  of (i) any dividend payable by the Company in shares of  Common
Stock,   or   (ii)   any   recapitalization,  reclassification,   split-up,
consolidation or combination of, or other change in or offering  of  rights
to  the  holders of, Common Stock, or (iii) an exchange of the  outstanding
shares  of Common Stock for a different number or class of shares of  stock
or   other  securities  of  the  Company  in  connection  with  a   merger,
consolidation or other reorganization of or involving the Company (provided
the  Company  shall be the surviving or resulting corporation in  any  such
merger  or  consolidation), then, to the extent that it, in its discretion,
shall  determine an adjustment to be appropriate in order to  reflect  such
event  or  transaction,  and in such manner as it  shall  determine  to  be
appropriate,  the Board of Directors shall adjust the number and  class  or
kind  of  shares  which  may  be issued under this  Agreement  and  of  the
securities  which shall be subject to the Option and/or the Exercise  Price
applicable  to  the Option, all computed on a basis prior  to  such  event.
However,  in  no  event  shall  any such adjustment  change  the  aggregate
Exercise  Price for Option Stock to be purchased upon the exercise  of  the
Option.

          Any such adjustments made shall be consistent with changes in the
Company's  outstanding Common Stock resulting from the  above  events  and,
when  made,  shall  be  final,  conclusive  and  binding  on  all  persons,
including,  without  limitation,  the Company,  its  shareholders  and  the
Optionee  or  other person having any interest in the Option  so  adjusted.
Any  fractional  shares  resulting  from  any  such  adjustment  shall   be
eliminated.

          (b)   Dissolution; Merger or Consolidation; Sale of  Assets.   In
the  event  of  a dissolution or liquidation of the Company,  the  sale  of
substantially  all the Company's assets, a merger or consolidation  of  the
Company with or into any other corporation or entity, or a statutory  share
exchange  in  which the Company's outstanding shares are  acquired  by  any
other   corporation  in  exchange  for  its  shares  (or  any  other   such
reorganization  or  similar transaction) in which the Company  is  not  the
surviving or resulting corporation, and if a provision is not made in  such
transaction for the continuance of this Agreement or the assumption of  the
Option  by  any  successor to the Company or for the substitution  for  the
Option  of a new option covering shares of any successor corporation  or  a
parent  or  subsidiary thereof, then, in such event, and to the extent  the
Option  has  not  previously been exercised, all  rights  of  the  Optionee
pursuant  to  this  Agreement shall terminate and be of no  further  effect
immediately  prior to the effective time of such dissolution,  liquidation,
sale, merger, consolidation, share exchange or other reorganization (or  at
such other time and pursuant to such rules and regulations as the Board  of
Directors shall determine and promulgate to the Optionee).  However, to the
extent   the   Option  shall  not  previously  have  been  exercised,   and
notwithstanding  any  provisions of this Agreement  to  the  contrary,  the
Option  shall become exercisable, and may be exercised, in full immediately
prior  to  the  effective time of any such event.  The Board  of  Directors
shall  give the Optionee at least thirty (30) days prior written notice  of
the  effective  time of an event which gives rise to an immediate  purchase
right under this Paragraph 10.

          (c)  Miscellaneous.  The grant of the Option shall not affect  in
any  way the right or power of the Company to (i) enter into or effect  any
adjustment, recapitalization, reclassification, reorganization or any other
change in the Company's capital or business structure or its business, (ii)
to merge or consolidate, or to dissolve, liquidate, sell or transfer all or
any  part  of  its business or assets, or (iii) to issue bonds, debentures,
preferred or other preference stock ahead of or affecting Common  Stock  or
the rights thereof.

     11.   Legal Restrictions on Exercise and Resale of Option Stock.   The
Optionee, by his acceptance of the Option, represents, covenants and agrees
that:  (i) the Option, and the Option Stock issuable upon exercise  of  the
Option, are being acquired for investment purposes only and not with a view
to  the  sale or distribution hereof;  (ii) he is knowledgeable  about  the
business and affairs of the Company and has been given, or given access to,
such  information regarding the Company as he considers necessary in  order
to  make an informed decision regarding a purchase of the Option Stock upon
exercise of the Option; (iii) that the Option Stock has not been registered
under  the Securities Act of 1933 (the "Act") and that, absent an effective
registration statement under the Act covering the Option Stock issued  upon
exercise  of the Option, or an available exemption from registration,  that
stock  will  be  "restricted stock" under the Act  and  may  not  be  sold,
transferred,  assigned,  hypothecated  or  otherwise  disposed  of  by  the
Optionee.

          At the Company's discretion, certificates evidencing Option Stock
issued  to Optionee upon the exercise of the Option may bear a legend  with
respect  to the restricted nature of those shares in the following form  or
in such other form as the Company may specify:

     THESE  SECURITIES HAVE NOT BEEN REGISTERED WITH THE UNITED STATES
     SECURITIES  AND EXCHANGE COMMISSION OR THE SECURITIES  COMMISSION
     OF  ANY  STATE  BECAUSE  THEY  ARE BELIEVED  TO  BE  EXEMPT  FROM
     REGISTRATION  UNDER SECTION 4(2) OF THE ACT.  THE SECURITIES  ARE
     "RESTRICTED"  AND  MAY  NOT BE RESOLD OR  TRANSFERRED  EXCEPT  AS
     PERMITTED  UNDER THE ACT PURSUANT TO REGISTRATION OR AN AVAILABLE
     EXEMPTION FROM REGISTRATION.

          As  a  condition of the exercise of the Option, the  Company  may
require that the Optionee execute one or more undertakings in such form  as
it  shall  prescribe to the effect that such shares are being acquired  for
investment purposes only and not with a view to the distribution or  resale
thereof  and  that the Optionee understands the restricted  nature  of  the
shares  and  will comply with the transfer restrictions applicable  to  the
shares.

          If  in  the opinion of legal counsel for the Company the issuance
or sale of any shares of Option Stock upon the exercise of the Option would
not  be  lawful  without registration under the Act or without  some  other
action being taken or for any other reason, or would require the Company to
obtain  approval from any governmental authority or regulatory body  having
jurisdiction  deemed by such counsel to be necessary to  such  issuance  or
sale,  then the Company shall not be obligated to issue or sell any  Option
Stock  to the Optionee or any other authorized person unless a registration
statement that complies with the provisions of the Act in respect  of  such
shares  is  in  effect  at  the time thereof,  or  all  other  required  or
appropriate  action  has been taken under and pursuant  to  the  terms  and
provisions  of  the  Act or other applicable law, or the  Company  receives
evidence  satisfactory to such counsel that the issuance and sale  of  such
shares,  in  the  absence of an effective registration statement  or  other
action,  would  not constitute a violation of the Act or  other  applicable
law,  or  unless any such required approval shall have been obtained.   The
Company  is  in no event obligated to register any such shares,  to  comply
with  any  exemption from registration requirements or to  take  any  other
action which may be required in order to permit, or to remedy or remove any
prohibition  or limitation on, the issuance or sale of such shares  to  the
Optionee or other authorized person.

     12.   Payment  of  Taxes.  The Optionee shall be responsible  for  all
federal,  state,  local or other taxes of any nature as  shall  be  imposed
pursuant  to any law or governmental regulation or ruling on the Option  or
the  exercise  thereof  or on any income which the Optionee  is  deemed  to
recognize in connection with the Option.  If the Company shall determine to
its reasonable satisfaction that the Company is required to pay or withhold
the whole or any part of any estate, inheritance, income, or other tax with
respect to or in connection with the Option or the exercise thereof, or  on
the Optionee=s resale of any shares of Option Stock, then the Company shall
have  the full power and authority to withhold and pay such tax out of  any
shares  of  Option Stock being purchased by the Optionee or from any  other
funds otherwise payable to the Optionee, or, prior to and as a condition of
exercising such Option, the Company may require that the Optionee pay to it
in  cash  the amount of any such tax which it, in good faith, deems  itself
required to withhold.

     13.   Nontransferability.   The Option  shall  not  be  assignable  or
transferable  except  by will or by the laws of descent  and  distribution,
and,  during the lifetime of the Optionee, may be exercised only by him  or
her.   More  particularly,  but  without limiting  the  generality  of  the
foregoing,  the  Option may not be sold, assigned, transferred  (except  as
noted  herein), pledged or hypothecated in any way and shall not be subject
to execution, attachment or similar process.

     14.   Notices.  Except as otherwise provided herein, any notice  which
the  Company  or the Optionee may be required or permitted to give  to  the
other  under  this Agreement shall be in writing and shall be  deemed  duly
given  when  delivered personally or deposited in the United  States  mail,
first  class postage prepaid, and properly addressed.  Notice,  if  to  the
Company,  shall  be sent to its President at the address of  the  Company=s
then current corporate  office.  Any notice sent by mail by the Company  to
the  Optionee shall be sent to the most current address of the Optionee  as
reflected on the records of the Company or its Subsidiaries as of the  time
said  notice is required.  If the Optionee has died, any such notice  shall
be  given  to the Optionee's personal representative if such representative
has  delivered to the Company evidence satisfactory to the Company of  such
representative's status as such and has informed the Company of the address
of such representative by notice pursuant to this Paragraph 14.

          Notwithstanding  anything contained herein  to  the  contrary,  a
Notice  of Exercise shall be effective only upon actual receipt thereof  by
the Company as provided in Paragraph 5 above.

     15.    Severability.   Whenever  possible,  each  provision  of   this
Agreement  shall  be  interpreted in such a  manner  as  to  be  valid  and
enforceable  under  applicable law, but, in the event  that  any  provision
hereof  shall  be  held  to  be  invalid or  unenforceable,  the  remaining
provisions shall continue to be in full force and effect and this Agreement
shall  continue to be binding on the parties hereto as if such  invalid  or
unenforceable provision or part hereof had not been included herein.

     16.   Modification of Agreement; Waiver.  Except as otherwise provided
herein,  this Agreement may be modified, amended, suspended, or terminated,
and  any  terms or conditions may be waived, but only by written instrument
signed by each of the parties hereto.  No waiver hereunder shall constitute
a  waiver  with  respect to any subsequent occurrence or other  transaction
hereunder or of any other provision hereof.

     17.  Captions and Headings; Gender and Number.  Captions and paragraph
headings used herein are for convenience only, do not modify or affect  the
meaning of any provision herein, are not a part hereof, and shall not serve
as  a  basis  for interpretation or in construction of this Agreement.   As
used  herein, the masculine gender shall include the feminine  and  neuter,
the  singular number the plural, and vice versa, whenever such meanings are
appropriate.

     18.    Governing   Law;   Venue  and  Jurisdiction.    The   validity,
interpretation and administration of this Agreement, and the rights of  any
and all persons having or claiming to have any interest hereunder, shall be
determined exclusively in accordance with the laws of the State of  Nevada.
Without  limiting the generality of the foregoing, the period within  which
any  action  in connection with this Agreement must be commenced  shall  be
governed  by the laws of the State of Nevada, without regard to  the  place
where  the act or omission complained of took place, the residence  of  any
party  to  such  action, or the place where the action may  be  brought  or
maintained.   The parties hereto agree that any suit or action relating  to
this Agreement shall be instituted and prosecuted in the courts of Beaufort
County,  North  Carolina, and each party hereby does  waive  any  right  or
defense relating to such jurisdiction and venue.

     19.   Binding Effect.  This Agreement shall be binding upon and  shall
inure  to the benefit of the Company, its successors and assigns, and shall
be  binding  upon  and  inure to the benefit of the  Optionee,  his  heirs,
legatees, personal representatives, executors, and administrators.

     20.   Entire  Agreement.  This Agreement constitutes and embodies  the
entire  understanding and agreement of the parties hereto with  respect  to
the  Option.   Except as otherwise provided hereunder, there are  no  other
agreements  or  understandings, written or  oral,  in  effect  between  the
parties hereto relating to the matters addressed herein.

     21.   Counterparts.  This Agreement may be executed in any  number  of
counterparts, each of which when executed and delivered shall be deemed  an
original, but all of which taken together shall constitute one and the same
instrument.

     IN  WITNESS  WHEREOF,  the Company has caused this  instrument  to  be
executed  in  its  corporate name by its President,  or  one  of  its  Vice
Presidents,  and  attested  by  its  Secretary  or  one  of  its  Assistant
Secretaries, and its corporate seal to be hereto affixed, all by  authority
of  its  Board of Directors first duly given, and the Optionee has hereunto
set  his  or  her hand and adopted as his or her seal the typewritten  word
"SEAL"  appearing beside his or her name, all done this the  day  and  year
first above written.


                                   FOUNTAIN POWERBOAT INDUSTRIES, INC.

     [CORPORATE SEAL]

                              By: _________________________________
ATTEST:                       President and Chief Executive Officer

_______________________
Secretary

                                   OPTIONEE:

                                   _________________________(SEAL)
                                        David L. Woods









                           EXHIBIT A







                     NOTICE OF EXERCISE OF
                          STOCK OPTION




To:  The Board of Directors of Fountain Powerboat Industries, Inc.


     The  undersigned hereby elects to purchase shares of Common  Stock  of
Fountain Powerboat Industries, Inc. (the "Company") pursuant to the  Option
granted  to the undersigned and that certain Stock Option Agreement between
the Company and the undersigned dated_____________________, 2001.

     The undersigned elects to purchase____________________whole shares  of
Common Stock having an aggregate Exercise Price of $ which is tendered
herewith:

     [    ]    in cash in the amount of $__________________;

     [    ]    by bank check or money order in the amount of $____________;

     [    ]    ___________________________________________________________.

              This the day of _____________________,______________________.





                                     ________________________________
                                             Optionee




</TEXT>
</DOCUMENT>
