Use python or perl script to extract "name" from blast hits, assign name to your sequences.

Does this what you want?

AutoFACT is an old software with many bugs (no problem if you know perl, they are easy to debug), but it is still useful for me. Autofact gathers blast hits descriptions against several protein databases and try to find a consensus annotation, prioritizing curated databases such as Swissprot, discarding uninformative hits and so on. For unassigned proteins (no informative hits), I often try to get some informative result from InterproScan and write something like "DOMAIN XYZ containing protein" if it has good hits to know domains or "Putative secreted protein" if it has a signal peptide. If you have expression data, you could annotate them as "Unknown potein expressed in tissue X"

For the others I annotate them as "hypothetical protein" (no hits, no information from anywhere) or "conserved hypothetical protein" (many hits against hypothetical proteins.

@Xiangfu: I really don't trust on blast much when it comes to use it for protein annotation transfer.

@Gustavo Costa - its nice one. I set-up all the db required for autofact. Do you/someone has kegg fasta and pathways file? It will help me a lot.