EXHIBIT 10.5

SPARTAN MOTORS, INC.
STOCK OPTION AND RESTRICTED STOCK PLAN OF 2003

PLAN DESCRIPTION

January 13, 2004

          The Spartan Motors, Inc. Stock Option and Restricted Stock Plan of
2003 (the "Plan") permits the grant and award of stock options and restricted
stock to directors, officers and key employees of Spartan Motors, Inc. and its
subsidiaries. The Plan's purposes are to provide Plan participants with an
increased incentive to contribute to the long-term performance and growth of
Spartan Motors and its subsidiaries, to join the interests of participants with
the interests of Spartan Motors' shareholders through the opportunity for
increased stock ownership and to attract and retain directors, officers and key
employees. The Plan is further intended to provide flexibility to Spartan Motors
in structuring long-term incentive compensation to best promote the foregoing
objectives.

This document constitutes part of a prospectus covering
Securities that have been registered under the Securities Act of 1933.
 

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Note:  This plan description is designed to assist you in understanding the
provisions of the Plan. The description in this booklet is qualified in its
entirety by the Plan, which is attached as Exhibit A. This booklet is not
intended to provide tax or legal advice or to substitute for professional or
investment advice. You are encouraged to consult your professional advisers on
all financial, legal and tax matters.

GENERAL PLAN INFORMATION

          The Plan permits the grant and award of stock options and restricted
stock (collectively, the "incentive awards") to directors, officers and key
employees (collectively, "participants") of Spartan Motors, Inc. and its
subsidiaries. Spartan Motors' board of directors believes that aligning the
interests of participants with the interests of Spartan Motors' shareholders
best advances the company's long-term interests. In addition, the board of
directors recognizes participants' importance to Spartan Motors' long-term
performance and growth. Accordingly, the issuance of incentive awards as part of
a comprehensive compensation program provides them with an incentive to continue
their directorship or employment with Spartan Motors, while further aligning
their interests with those of Spartan Motors' shareholders.

          A total of 1,000,000 shares of Spartan Motors common stock, $.01 par
value, may be granted or awarded under the Plan. However, the number of shares
may be adjusted in the future to reflect stock dividends and other changes in
Spartan Motors' capitalization. Shares deliverable on the exercise or grant of
an incentive award under the Plan will be authorized and unissued shares or
shares repurchased by Spartan Motors, including shares purchased on the open
market. No participant may be granted, during any calendar year, incentive
awards with respect to more than 125,000 shares of Spartan Motors common stock
(subject to certain capital adjustments) made available for incentive awards
under the Plan.

          The Plan is not subject to any provisions of the Employee Retirement
Income Security Act of 1974 (ERISA) and is not qualified under Section 401(a) of
the Internal Revenue Code of 1986. The Plan took effect, subject to shareholder
approval, on April 22, 2003. Spartan Motors' shareholders approved the Plan on
May 28, 2003. Incentive awards can be made under the Plan until April 21, 2013.

ADMINISTRATION OF THE PLAN

          The compensation committee of Spartan Motors' board of directors (the
"committee") administers the Plan. Each member of the committee is appointed by
and serves at the pleasure of the board of directors. The Plan requires the
committee to consist of at least two members of Spartan Motors' board of
directors, and all of its members to be "non-employee directors" as defined in
Rule 16b-3 under the Securities Exchange Act of 1934 and "outside directors" as
defined in the regulations under Section 162(m) of the Internal Revenue Code.

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          The committee will determine, subject to the terms of the Plan, (1)
who will participate in the Plan, (2) the nature and extent of incentive awards
to be granted to each participant, (3) the time of each grant, (4) the duration
of and restrictions applicable to each incentive award, and (5) all other
matters necessary or advisable for administration of the Plan. The committee may
amend the terms of the incentive awards granted under the Plan from time to time
in any manner, subject to the limitations specified in the Plan.

STOCK OPTIONS

          Grant.  Except as discussed in the following paragraph, the committee
will select the participants who will receive stock options and will determine
the terms and conditions of stock options granted under the Plan. The committee
may vary, among participants and among stock options granted to the same
participant, any and all of the terms and conditions of the stock options
granted under the Plan. If you are granted a stock option under the Plan, then
it will be evidenced by either a stock option agreement or a certificate of
award, or both (collectively, a "stock option agreement"). You should carefully
read your stock option agreement(s) and the Plan to understand the specific
terms of your option(s). In addition, the committee may designate whether a
stock option is to be considered an "incentive stock option" as defined in
Section 422(b) of the Internal Revenue Code; however, no stock option granted to
a director who is not an employee of Spartan Motors or its subsidiaries may be
an incentive stock option.

          Option Grants to Non-employee Directors.  Notwithstanding the
foregoing, the Plan provides that, to the extent not granted under the Stock
Option and Restricted Stock Plan of 1998, a stock option to purchase 3,500
(7,500 for a non-employee director who is also Chairman of the Board) shares of
Spartan Motors common stock (subject to adjustment in the event of a stock
split, stock dividend, recapitalization, etc.) will automatically be granted to
each non-employee director on June 30 and December 31 of each year during the
life of the Plan.

          Stock Option Price.  The committee will determine the per-share
exercise price of any stock options granted under the Plan, provided that the
per-share exercise price of options must be equal to or greater than 100% of the
fair market value of Spartan Motors common stock on the grant date. Furthermore,
if you own more than 10% of the total combined voting power of all classes of
company stock (as determined under Section 424(d) of the Internal Revenue Code),
then stock options granted to you will not be incentive stock options, unless
those options have a per-share exercise price equal to at least 110% of the
market price on the grant date.

          Exercise Period.  Each stock option granted under the Plan may be
exercised in whole or in part from time to time during the period that is
specified in the stock option agreement governing that option. You cannot
exercise a stock option later than ten years after the option is granted to you.
However, if you own more than 10% of the total combined voting power of all
classes of company stock (as determined under Section 424(d) of the Internal
Revenue Code), then no option granted to you will be an incentive stock option
unless the option must be exercised within five years of the date of grant. In
addition, the committee may require you to continue service with Spartan Motors
for a specified period of time before stock options become

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exercisable and/or may require you to represent that your shares are being
acquired for investment purposes only.

          Payment of Option Price.  When exercising your stock options, you must
pay Spartan Motors the exercise price in cash or, if the committee consents or
provides in your stock option agreement, in shares of Spartan Motors common
stock that were held by you for at least six months ("mature shares") or other
consideration substantially equivalent to cash.

          Restrictions on Transferability.  Unless the committee consents or
your stock option agreement provides otherwise, you may not sell, exchange,
transfer, pledge, assign or otherwise alienate or hypothecate your stock
options, except by will or the laws of descent and distribution. If a transfer
is permitted, the transferee must execute a written agreement permitting Spartan
Motors to withhold a number of shares to be received upon the exercise of the
stock option to pay for any federal, state or local withholding or other taxes
associated with or resulting from the exercise of the stock option. The
committee may also impose other restrictions on shares of stock acquired
pursuant to the exercise of options.

          Termination of Employment, Directorship or Officer Status.  Unless the
committee consents or your stock option agreement provides otherwise, if you
cease to be a director of Spartan Motors or cease to be employed by or an
officer of Spartan Motors or one of its subsidiaries for any reason other than
death, disability, retirement (as defined in the Plan) or termination for cause,
then you may exercise your stock options in accordance with their terms for
three months after your termination, but only to the extent that your stock
options could have been exercised on the date of your termination. However,
stock options may not be exercised after their expiration dates.

          Death.  Unless the committee consents or your stock option agreement
provides otherwise, if you die while you are a director of Spartan Motors or an
employee or officer of Spartan Motors or one of its subsidiaries, or after your
directorship or employment is terminated, other than for cause, during the time
when you could have exercised your stock options, your personal representative
or other successor may exercise your stock options in accordance with their
terms for one year after your death. However, only stock options that could have
been exercised on the date of death or the date of termination of employment or
directorship (whichever happened first) may be exercised, unless the committee
consents to a different time period or your stock option agreement provides
otherwise. However, in no event may stock options be exercised after their
expiration dates.

          Disability.  Unless the committee consents or your stock option
agreement provides otherwise, if you cease to be a director of Spartan Motors or
an employee or officer of Spartan Motors or one of its subsidiaries due to a
disability, then you may exercise your stock options in accordance with their
terms for one year following your termination of employment or directorship.
Only stock options that could have been exercised on the date of termination may
be exercised, unless the committee consents to different time period or your
stock option

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agreement provides otherwise. However, in no event may stock options be
exercised after their expiration dates.

          Retirement.  Unless the committee consents or your stock option
agreement provides otherwise, if you retire (as set forth in the Plan), stock
options granted to you under the Plan may be exercised in accordance with their
terms before their expiration dates.

          Termination for Cause; Competition.  If you are terminated for cause,
then you will have no further right to exercise any stock options. For purposes
of the Plan the committee or officers designated by the committee will have
absolute discretion to determine whether a termination is for cause. The
committee may also provide by resolution or through a stock option agreement
that you will have no further right to exercise stock options after termination
of employment or directorship if the committee determines that you have entered
into competition (as defined in the Plan) with Spartan Motors.

RESTRICTED STOCK

          Grant.  The Plan provides that the committee may award restricted
stock, but not more than 50% of the shares authorized for issuance under the
Plan may be issued as restricted stock. The committee, consistent with the Plan,
will select the recipients (if any) of restricted stock awards and determine the
terms and conditions of those awards.

          Restricted Stock Agreements.  The Plan provides that each award of
restricted stock will be evidenced by a restricted stock agreement or a
certificate of award (collectively, a "restricted stock agreement"). You should
carefully read your restricted stock agreement(s) and the Plan to understand the
specific terms of your restricted stock award(s).

          Restrictions on Transferability.  Unless the committee consents or
your restricted stock agreement provides otherwise, you may not sell, exchange,
transfer, pledge, assign or otherwise alienate or hypothecate your restricted
stock, except by will or the laws of descent and distribution during the
"restricted period" (the period before the restrictions on the restricted stock
lapse and the restricted stock vests). In addition, only you, your guardian or
legal representative may exercise rights with respect to your restricted stock
during your lifetime.

          Termination of Employment or Directorship.  Unless the committee
consents or your restricted stock agreement provides otherwise, if you cease to
be a director, employee or officer before your restricted stock vests for any
reason other than death, disability, retirement (as defined in the Plan) or
termination for cause, then any shares that are still subject to restrictions at
that time will be automatically forfeited and returned to Spartan Motors.

          Death, Retirement or Disability.  Unless the committee consents or
your restricted stock agreement provides otherwise, if your employment or
directorship is terminated because of death, disability or retirement (as
defined in the Plan) during the restricted period, then the restrictions
applicable to your shares of restricted stock will terminate automatically with
respect

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to that number of shares (rounded to the nearest whole number) equal to the
total number of shares of restricted stock granted to you, multiplied by the
number of full months that have elapsed since the date of grant, divided by the
total number of full months in the restricted period. All remaining shares will
be forfeited and returned to Spartan Motors; provided, that the committee may,
in its sole discretion, waive the restrictions remaining on any or all such
shares of restricted stock either before or after your death, disability or
retirement.

          Termination for Cause.  If you are terminated for cause, then you will
have no further right to exercise or receive any restricted stock and all
restricted stock still subject to restrictions as of the date of termination
will be automatically forfeited and returned to Spartan Motors. The committee or
officers designated by the committee will have absolute discretion to determine
whether a termination is for cause.

          Rights as a Shareholder.  During the restricted period, subject to the
transfer restrictions, risk of forfeiture and other terms of the Plan, you will
have all rights as a shareholder with respect to your restricted stock,
including the right to vote, the right to receive without restriction all cash
dividends paid on those shares of restricted stock and the right to participate
in any stock dividend, stock split, recapitalization or other adjustment in
Spartan Motors common stock. Unless the committee otherwise determines or the
terms of your restricted stock agreement provide otherwise, any non-cash
dividends or distributions paid with respect to shares of unvested restricted
stock will be subject to the same restrictions as the shares to which such
dividends or distributions relate.

CHANGE IN CONTROL

          General.  If a change in control (as defined in the Plan) of Spartan
Motors occurs, then, unless the committee or the board of directors determines
otherwise, all of your unvested stock options will become immediately
exercisable in full and will remain exercisable during the remaining term. All
other outstanding incentive awards will become fully vested, exercisable and
nonforfeitable.

          Cash Payment for Options.  If a change of control occurs, then the
committee, in its sole discretion and without your consent, may choose to redeem
some or all of your unexercised stock options for cash in accordance with
Section 7.2 of the Plan.

NO RIGHT TO EMPLOYMENT OR AWARDS

          You do not have any claim to be granted an incentive award under the
Plan and there is no obligation of unity of treatment under the Plan. The grant
of an incentive award does not give you a right to remain in the employ or
directorship of Spartan Motors or any of its subsidiaries. Spartan Motors or any
of its subsidiaries may at any time dismiss you from employment or terminate
your directorship, free from any liability or any claim under the Plan, unless
otherwise expressly provided in the Plan or in any written agreement with you.
Spartan Motors may also suspend your rights under any incentive award (including
your right to exercise stock options)

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for a period of up to 60 days while the termination for cause of your employment
or directorship is under consideration.

TAX WITHHOLDING

          Spartan Motors has the right to (1) withhold and deduct from your
future wages (or from other amounts that may be due and owing to you from
Spartan Motors or a subsidiary), or make arrangements for the collection of, all
legally required amounts necessary to satisfy federal, state, local and foreign
withholding and employment-related tax requirements attributable to an incentive
award, or (2) require you to promptly remit the amount of such withholding to
Spartan Motors before taking any action with respect to an incentive award.
Unless the committee determines otherwise, withholding may be satisfied (but
only to the extent required to satisfy the minimum amount required to be
withheld by law or regulation) by withholding common stock to be received in
connection with an incentive award or by delivering to Spartan Motors previously
owned shares of Spartan Motors common stock.

AMENDMENT AND TERMINATION

          Spartan Motors' board of directors may amend or terminate the Plan at
any time, provided that no such amendment or termination, except where
explicitly permitted by the Plan or by the terms of an incentive award, may
impair any of your outstanding incentive awards without your written consent.

FEDERAL INCOME TAX CONSEQUENCES

Stock Options

          Incentive Stock Options.  Options for Spartan Motors common stock
granted to employees of Spartan Motors or one of its subsidiaries with a value
of not more than $100,000 as of the date of grant which are first exercisable by
a participant in any one year may be treated as incentive stock options under
the Internal Revenue Code. There is no limit on the aggregate value of
underlying shares for options that are not incentive stock options. If you
receive options that qualify under Section 422 of the Internal Revenue Code as
incentive stock options, then the following tax consequences apply.

          You will recognize no income when you are granted or exercise your
option to purchase shares and recognition of gain or loss is deferred until you
subsequently sell the stock, provided that the following conditions are
satisfied:

 

1.

You do not dispose of the stock within two years of the date of grant of the
option;

       

2.

You do not dispose of the stock within one year after the exercise of the
option; and

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3.

The option is exercised not later than three months after the termination of
employment (one year in the event of disability).

Special rules apply when you own an option at the time of your death.

          If you meet the above conditions, there are no federal tax
consequences to Spartan Motors upon the grant or exercise of an incentive stock
option. The difference between the market value and the exercise price is,
however, a tax preference item for the purpose of calculating your alternative
minimum tax.

          If you fail to meet any of the above conditions, you will recognize
compensation income at the time you exercise the option (as in (3) above) or
make the disqualifying disposition (as in (1) or (2) above). The ordinary income
would be the difference between the option price and the market value of the
stock at the time of exercise, but not more than the excess of the amount
recognized on the disqualifying disposition over the adjusted basis in the stock
acquired upon the exercise of the option (generally, the difference between the
option price and the price at which you sell the stock in the disqualifying
disposition). Additional gain, if any, will be capital gain, long-term or
short-term, depending on your holding period. Spartan Motors is entitled to a
deduction for federal income tax purposes at the same time and in the same
amount as you are considered to have recognized compensation income.

          Proposed Treas. Reg. §1.422-5 provides that where an option is
exercised through payment with shares of stock, the basis and holding period of
the shares received are adjusted. If you use mature shares to pay the exercise
price of an option, then you will not recognize gain at the time of exercise on
any appreciation in value of the mature shares that were used to exercise the
option, unless the mature shares were acquired under an incentive stock option
and did not meet the holding period requirements discussed above. A number of
shares received, equal to the number of shares used for payment, have the same
basis and holding period as the shares used for payment, increased, where
applicable, by an amount included as compensation income as a result of such
exercise. Your basis in any additional shares will be the sum of the amount of
cash paid to exercise the option and the gain that you recognized on the
exercise. Whenever shares of stock acquired through the exercise of an option
are used as payment in the exercise of an option before satisfying the holding
periods described above, the shares with the lowest basis will be considered a
disqualifying disposition first in determining the amount of compensation income
to be taxed to the optionee.

          Except in cases of substitute basis resulting from payment of the
exercise price with shares of stock as provided above, the basis of the shares
will be the option exercise price plus any income recognized on a disqualifying
disposition. Upon a sale, you will recognize long- or short-term capital gain or
loss on the transaction depending upon your holding period and the basis and the
amount of the proceeds.

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          Non-Incentive Stock Options.  If you receive options that do not
qualify as "incentive stock options" under Section 422 of the Internal Revenue
Code, then the following tax consequences apply:

          You will not recognize any income when the option is granted. You will
recognize compensation income on the day you exercise the option in an amount
equal to the excess of the market value of the shares on the exercise date over
the amount paid for the shares. Spartan Motors is entitled to a deduction for
this same amount. Tax withholding applies and may be satisfied out of other
compensation or shares of Spartan Motors common stock, either those received on
exercise or other shares. Social Security Tax and Unemployment Tax (FICA and
FUTA) apply to non-incentive stock options on the same date income is
recognized.

          If you use previously owned shares of Spartan Motors common stock as
consideration to purchase the shares pursuant to the option (if the committee
consents or your stock option agreement so allows), then you will not recognize
gain at the time of exercise on any appreciation in value of the Spartan Motors
common stock that you used to exercise the option. Your tax basis in the
aggregate number of shares will be the basis in the shares exchanged plus the
income recognized on exercise as provided above, plus any cash consideration
used to pay the option price.

          Upon the sale of the shares, the transaction will be a sale or
exchange of property resulting in long- or short-term capital gain or loss,
depending upon your holding period and the basis and amount of proceeds.

Restricted Stock

          Generally, you only recognize income on the restricted stock once it
vests (when the restrictions lapse). Once vested, you will recognize
compensation income on the difference between the fair market value of the
restricted stock and the amount you paid for the stock, if any. Spartan Motors
would receive a corresponding deduction in the same amount. Before the
restricted stock vests, any dividends paid on the restricted stock will be
treated as compensation income to you, with Spartan Motors receiving a
corresponding deduction.

          Under Section 83(b) of the Internal Revenue Code, you may elect to
report compensation income for the tax year in which you receive a grant of
restricted stock. Again, Spartan Motors would be entitled to take a
corresponding deduction for federal income tax purposes. If you make such an
election, the amount of compensation income is the value of the restricted stock
at the time of grant. Any later appreciation in the value of the restricted
stock is treated as capital gain and recognized only upon a sale of the
restricted stock. Dividends received after such an election is made are taxable
as dividends and not treated as additional compensation income. However, if the
restricted stock is forfeited after you make a Section 83(b) election, you will
not be allowed any deduction for the amount that you earlier took into income.
Because a Section 83(b) election is irrevocable and has both benefits and risks,
you should consult tax counsel at

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the time you receive a grant of restricted stock to determine the most
advantageous course in your individual circumstances.

          Upon the sale of restricted stock (subject to any terms imposed by
Spartan Motors to ensure compliance with federal or state securities laws), you
will recognize capital gain or loss in the amount of the difference between the
sale price and the value of the stock that you previously reported as
compensation income.

          The federal income tax provisions applicable to incentive awards are
complex and are subject to change. Spartan Motors encourages you to seek tax
counsel before accepting incentive awards under the Plan.

INFORMATION AVAILABLE TO PARTICIPANTS

          General.  Spartan Motors' latest Form 10-K Annual Report, all reports
and documents that Spartan Motors has filed pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act since the end of the fiscal year covered by the
latest Form 10-K Annual Report and the description of Spartan Motors' stock
contained in its Registration Statement filed under the Securities Exchange Act,
including any amendment or report filed for the purpose of updating such
description, and all documents filed by Spartan Motors pursuant to Sections
13(a), 13(c), 14, and 15(d) of the Securities Exchange Act of 1934 after the
registration on Form S-8 of shares to be issued under the Plan and before the
filing of a post-effective amendment that indicates that all securities offered
under the Plan have been sold or that deregisters all securities then remaining
unsold are incorporated by reference in this Plan Description.

          You may obtain this information without charge by making written or
oral requests to James W. Knapp, Spartan Motors' Chief Financial Officer,
Secretary and Treasurer. Employees may obtain additional information regarding
the Plan or the administration of the Plan by making written or oral requests to
Spartan Motors at 1000 Reynolds Road, Post Office Box 440, Charlotte, Michigan
48813, telephone number (517) 543-6400. Spartan Motors does not intend to
provide you with regular statements regarding your incentive awards. You may,
however, obtain information regarding your incentive awards by contacting
Spartan Motors at the address or telephone number set forth above.

          Annual Report.  A copy of Spartan Motors' annual report for the year
ended December 31, 2002 is included with this Plan Description.

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EXHIBIT A

SPARTAN MOTORS, INC.

STOCK OPTION AND RESTRICTED STOCK PLAN OF 2003

(As Amended October 21, 2003)

SECTION 1

Establishment of Plan; Purpose of Plan

          1.1          Establishment of Plan.  The Company hereby establishes
the STOCK OPTION AND RESTRICTED STOCK PLAN OF 2003 (the "Plan") for its
directors, corporate, divisional and Subsidiary officers and other key
employees. The Plan permits the grant and award of Stock Options and Restricted
Stock.

          1.2          Purpose of Plan.  The purpose of the Plan is to provide
directors, officers and key management employees of the Company, its divisions
and its Subsidiaries with an increased incentive to contribute to the long-term
performance and growth of the Company and its Subsidiaries, to join the
interests of directors, officers and key employees with the interests of the
Company's shareholders through the opportunity for increased stock ownership and
to attract and retain directors, officers and key employees. The Plan is further
intended to provide flexibility to the Company in structuring long-term
incentive compensation to best promote the foregoing objectives. Within that
context, it is intended that most awards of Stock Options under the Plan are to
provide performance-based compensation under Section 162(m) of the Code and the
Plan shall be interpreted, administered and amended if necessary to achieve that
purpose.

SECTION 2

Definitions

          The following words have the following meanings unless a different
meaning plainly is required by the context:

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

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

Exhibit A - Page 1

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          2.3          "Change in Control," unless otherwise defined in an
Incentive Award, means (a) the failure of the Continuing Directors at any time
to constitute at least a majority of the members of the Board; (b) the
acquisition by any Person other than an Excluded Holder of beneficial ownership
(within the meaning of Rule 13d-3 issued under the Act) of 20% or more of the
outstanding Common Stock or the combined voting power of the Company's
outstanding securities entitled to vote generally in the election of directors;
(c) the approval by the shareholders of the Company of a reorganization, merger
or consolidation, unless with or into a Permitted Successor; or (d) the approval
by the shareholders of the Company of a complete liquidation or dissolution of
the Company or the sale or disposition of all or substantially all of the assets
of the Company other than to a Permitted Successor.

          2.4          "Code" means the Internal Revenue Code of 1986, as
amended.

          2.5          "Committee" means the Compensation Committee of the
Board. The Committee shall consist of at least two members of the Board and all
of its members shall be Non-employee Directors and "outside directors" as
defined in the regulations issued under Section 162(m) of the Code.

          2.6          "Common Stock" means the Common Stock, $.01 par value, of
the Company.

          2.7          "Company" means Spartan Motors, Inc., a Michigan
corporation, and its successors and assigns.

          2.8          "Competition" means participation, directly or
indirectly, in the ownership, management, financing or control of any business
that is the same as or similar to the present or future businesses of the
Company or any Subsidiary. Such participation may be by way of employment,
consulting services, directorship or officership. Ownership of less than 3% of
the shares of any corporation whose shares are traded publicly on any national
or regional stock exchange or over the counter shall not be deemed Competition.

          2.9          "Continuing Directors" mean the individuals constituting
the Board as of the date this Plan was adopted and any subsequent directors
whose election or nomination for election by the Company's shareholders was
approved by a vote of three-quarters (3/4) of the individuals who are then
Continuing Directors, but specifically excluding any individual whose initial
assumption of office occurs as a result of either an actual or threatened
solicitation subject to Rule 14a-12(c) of Regulation 14A issued under the Act or
other actual or threatened solicitation of proxies or consents by or on behalf
of a Person other than the Board.

          2.10          "Employee Benefit Plan" means any plan or program
established by the Company or a Subsidiary for the compensation or benefit of
employees of the Company or any of its Subsidiaries.

          2.11          "Excluded Holder" means (a) any Person who at the time
this Plan was adopted was the beneficial owner of 10% or more of the outstanding
Common Stock; or (b) the

Exhibit A - Page 2

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Company, a Subsidiary or any Employee Benefit Plan of the Company or a
Subsidiary or any trust holding Common Stock or other securities pursuant to the
terms of an Employee Benefit Plan.

          2.12          "Incentive Award" means the award or grant of a Stock
Option or Restricted Stock to a Participant pursuant to the Plan.

          2.13          "Market Value" shall equal the last reported sales price
of shares of Common Stock on The Nasdaq Stock Market (or any successor exchange
that is the primary stock exchange for trading of Common Stock) on the date of
grant, or if The Nasdaq Stock Market (or any such successor) is closed on that
date, the last preceding date on which The Nasdaq Stock Market (or any such
successor) was open for trading and on which shares of Common Stock were traded.
If the Company's Common Stock is not listed on Nasdaq or another quotation
system or stock exchange on the date in question, the Market Value shall be
determined by any means deemed fair and reasonable by the Committee, which
determination shall be final and binding on all parties.

          2.14          "Mature Shares" means shares of Common Stock that a
Participant has owned for at least six months.

          2.15          "Non-employee Director" shall have the meaning set forth
in Rule 16b-3 under the Act as in effect from time to time.

          2.16          "Participant" means a director, corporate officer,
divisional officer or any key employee of the Company, its divisions or its
Subsidiaries who is granted an Incentive Award under the Plan.

          2.17          "Permitted Successor" means a company that, immediately
following the consummation of a transaction specified in clauses (c) and (d) of
the definition of "Change in Control" above, satisfies each of the following
criteria: (a) 50% or more of the outstanding common stock of the company and the
combined voting power of the outstanding securities of the company entitled to
vote generally in the election of directors (in each case determined immediately
following the consummation of the applicable transaction) is beneficially owned,
directly or indirectly, by all or substantially all of the Persons who were the
beneficial owners of the Company's outstanding Common Stock and outstanding
securities entitled to vote generally in the election of directors
(respectively) immediately prior to the applicable transaction; (b) no Person
other than an Excluded Holder beneficially owns, directly or indirectly, 20% or
more of the outstanding common stock of the company or the combined voting power
of the outstanding securities of the company entitled to vote generally in the
election of directors (for these purposes the term Excluded Holder shall include
the company, any subsidiary of the company and any employee benefit plan of the
company or any such subsidiary or any trust holding common stock or other
securities of the company pursuant to the terms of any such employee benefit
plan); and (c) at least a majority of the board of directors of the company is
comprised of Continuing Directors.

Exhibit A - Page 3

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          2.18          "Person" has the same meaning as set forth in Sections
13(d) and 14(d)(2) of the Act.

          2.19          "Restricted Period" means the period of time during
which Restricted Stock awarded under the Plan is subject to restrictions. The
Restricted Period may differ among Participants and may have different
expiration dates with respect to shares of Common Stock covered by the same
Incentive Award.

          2.20          "Restricted Stock" means Common Stock awarded to a
Participant pursuant to Section 6 of the Plan.

          2.21          "Retirement" means the voluntary termination of all
employment by a Participant or the fulfillment of the term for which a director
of the Company was elected followed by that director not standing for
re-election (as applicable) after the Participant has attained 62 years of age,
or such other age as shall be determined by the Committee in its sole discretion
or as otherwise may be set forth in the Incentive Award agreement or other grant
document with respect to a Participant and a particular Incentive Award.

          2.22          "Stock Option" means the right to purchase Common Stock
at a stated price for a specified period of time. For purposes of the Plan, a
Stock Option may be either an incentive stock option within the meaning of
Section 422(b) of the Code or a nonqualified stock option.

          2.23          "Subsidiary" means any corporation or other entity of
which 50% or more of the outstanding voting stock or voting ownership interest
is directly or indirectly owned or controlled by the Company or by one or more
Subsidiaries of the Company.

SECTION 3

Administration

          3.1          Power and Authority. The Committee shall administer the
Plan. The Committee may delegate record keeping, calculation, payment and other
ministerial administrative functions to individuals designated by the Committee,
who may be officers or employees of the Company or its Subsidiaries. Except as
limited in this Plan or as may be necessary to ensure that this Plan provides
performance-based compensation under Section 162(m) of the Code, the Committee
shall have all of the express and implied powers and duties set forth in the
Bylaws of the Company and this Plan, shall have full power and authority to
interpret the provisions of the Plan and Incentive Awards granted under the Plan
and shall have full power and authority to supervise the administration of the
Plan and Incentive Awards granted under the Plan and to make all other
determinations considered necessary or advisable for the administration of the
Plan. All determinations, interpretations and selections made by the Committee
regarding the Plan shall be final and conclusive. The Committee shall hold its
meetings at such times and

Exhibit A - Page 4

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places as it considers advisable. Action may be taken by a written instrument
signed by all of the members of the Committee and any action so taken shall be
fully as effective as if it had been taken at a meeting duly called and held.
The Committee shall make such rules and regulations for the conduct of its
business as it considers advisable.

          3.2          Grants or Awards to Participants. In accordance with and
subject to the provisions of the Plan, the Committee shall have the authority to
determine all provisions of Incentive Awards as the Committee may consider
necessary or desirable and as are consistent with the terms of the Plan,
including, without limitation, the following: (a) the persons who shall be
selected as Participants; (b) the nature and, subject to the limitations set
forth in Sections 4.1 and 4.2 of the Plan, extent of the Incentive Awards to be
made to each Participant (including the number of shares of Common Stock to be
subject to each Incentive Award, any exercise price, the manner in which an
Incentive Award will vest or become exercisable and the form of payment for the
Incentive Award); (c) the time or times when Incentive Awards will be granted;
(d) the duration of each Incentive Award; and (e) the restrictions and other
conditions to which payment or vesting of Incentive Awards may be subject.

          3.3          Amendments or Modifications of Awards. The Committee
shall have the authority to amend or modify the terms of any outstanding
Incentive Award in any manner, provided that the amended or modified terms are
not prohibited by the Plan as then in effect, including, without limitation, the
authority to: (a) modify the number of shares or other terms and conditions of
an Incentive Award; (b) extend the term of an Incentive Award; (c) accelerate
the exercisability or vesting or otherwise terminate, waive or modify any
restrictions relating to an Incentive Award; (d) accept the surrender of any
outstanding Incentive Award; and (e) to the extent not previously exercised or
vested, authorize the grant of new Incentive Awards in substitution for
surrendered Incentive Awards; provided, that Incentive Awards issued under the
Plan may not be repriced, replaced, regranted through cancellation or modified
without shareholder approval if the effect of such repricing, replacement,
regrant or modification would be to reduce the exercise price of then
outstanding Incentive Awards to the same Participants.

          3.4          Indemnification of Committee Members. Neither any member
nor former member of the Committee nor any individual to whom authority is or
has been delegated shall be personally responsible or liable for any act or
omission in connection with the performance of powers or duties or the exercise
of discretion or judgment in the administration and implementation of the Plan.
Each person who is or shall have been a member of the Committee shall be
indemnified and held harmless by the Company from and against any cost,
liability or expense imposed or incurred in connection with such person's or the
Committee's taking or failing to take any action under the Plan. Each such
person shall be justified in relying on information furnished in connection with
the Plan's administration by any appropriate person or persons.

Exhibit A - Page 5

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SECTION 4

Shares Subject to the Plan

          4.1          Number of Shares. Subject to adjustment as provided in
Section 4.3 of the Plan, the total number of shares of Common Stock available
for Incentive Awards under the Plan shall be 1,000,000 shares of Common Stock;
plus shares subject to Incentive Awards that are canceled, surrendered,
modified, exchanged for substitute Incentive Awards or expire or terminate prior
to the exercise or vesting of the Incentive Award in full and shares that are
surrendered to the Company in connection with the exercise or vesting of an
Incentive Award, whether previously owned or otherwise subject to such Incentive
Award; provided, that not more than 50% of the shares authorized for issuance
under the Plan pursuant to this Section 4.1 may be issued as Restricted Stock.
Such shares shall be authorized and may be unissued shares, shares issued and
reacquired by the Company or shares bought on the market.

          4.2          Limitation Upon Incentive Awards. No Participant shall be
granted, during any calendar year, Incentive Awards with respect to more than
125,000 shares of Common Stock, subject to adjustment as provided in Section 4.3
of the Plan. The purpose of this Section 4.2 is to ensure that the Plan may
provide performance-based compensation under Section 162(m) of the Code and this
Section 4.2 shall be interpreted, administered and amended if necessary to
achieve that purpose.

          4.3          Adjustments.

          (a)          Stock Dividends and Distributions. If the number of
shares of Common Stock outstanding changes by reason of a stock dividend, stock
split, recapitalization or other general distribution of Common Stock or other
securities to holders of Common Stock, the number and kind of securities subject
to Incentive Awards and reserved for issuance under the Plan, together with
applicable exercise prices, as well as the number of shares available for
issuance under the Plan and the limitation provided in Section 4.2, shall be
adjusted appropriately. No fractional shares shall be issued pursuant to the
Plan and any fractional shares resulting from such adjustments shall be
eliminated from the respective Incentive Awards.

          (b)          Other Actions Affecting Common Stock. If there occurs,
other than as described in the preceding subsection, any merger, business
combination, recapitalization, reclassification, subdivision or combination
approved by the Board that would result in the Persons who were shareholders of
the Company immediately prior to the effective time of any such transaction
owning or holding, in lieu of or in addition to shares of Common Stock, other
securities, money and/or property (or the right to receive other securities,
money and/or property) immediately after the effective time of such transaction,
then the outstanding Incentive Awards (including exercise prices) and reserves
for Incentive Awards under this Plan shall be adjusted in such manner and at
such time as shall be equitable under the circumstances. It is intended that in
the event of

Exhibit A - Page 6

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any such transaction, Incentive Awards under this Plan shall entitle the holder
of each Incentive Award to receive (upon exercise in the case of Stock Options),
in lieu of or in addition to shares of Common Stock, any other securities, money
and/or property receivable upon consummation of any such transaction by holders
of Common Stock with respect to each share of Common Stock outstanding
immediately prior to the effective time of such transaction; upon any such
adjustment, holders of Incentive Awards under this Plan shall have only the
right to receive in lieu of or in addition to shares of Common Stock such other
securities, money and/or other property as provided by the adjustment. If the
agreement, resolution or other document approved by the Board to effect any such
transaction provides for the adjustment of Incentive Awards under the Plan in
connection with such transaction, then the adjustment provisions contained in
such agreement, resolution or other document shall be final and conclusive.

SECTION 5

Stock Options

          5.1          Grant.

          (a)          Officers and Employees. Except as set forth below for
Non-employee Directors, a Participant may be granted one or more Stock Options
under the Plan. The Committee, in its discretion, may provide in the initial
grant of a Stock Option or other Incentive Award for the subsequent automatic
grant of additional Stock Options for the number of Mature Shares, if any, that
are surrendered to the Company in connection with the exercise or vesting of the
initial or any subsequently granted Stock Option or other Incentive Award. Stock
Options shall be subject to such terms and conditions, consistent with the other
provisions of the Plan, as may be determined by the Committee in its sole
discretion. In addition, the Committee may vary, among Participants and among
Stock Options granted to the same Participant, any and all of the terms and
conditions of the Stock Options granted under the Plan. Subject to the
limitation imposed by Section 4.2 of the Plan, the Committee shall have complete
discretion in determining the number of Stock Options granted to each
Participant. The Committee may designate whether or not a Stock Option is to be
considered an incentive stock option as defined in Section 422(b) of the Code;
provided, that the number of shares of Common Stock that may be designated as
subject to incentive stock options for any given Participant shall be limited to
that number of shares that become exercisable for the first time by the
Participant during any calendar year (under all plans of the Company and its
Subsidiaries) and have an aggregate Market Value less than or equal to $100,000
(or such other amount as may be set forth in the Code) and all shares subject to
an Incentive Award that have a Market Value in excess of such aggregate amount
shall automatically be subject to Stock Options that are not incentive stock
options.

Exhibit A - Page 7

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          (b)          Non-employee Directors. Subject to the limitation imposed
by Section 4.2 and the adjustments imposed by Section 4.3 and to the extent not
granted under the Spartan Motors, Inc. Stock Option and Restricted Stock Plan of
1998, an Option to purchase 3,500 shares of Common Stock shall be granted
automatically on June 30 and December 31 of each year, to each director of the
Company who is, at the time of such grant, a Non-employee Director; provided,
however, that if any Non-employee Director is at the time of grant the Chairman
of the Board, the number of shares subject to the Option granted to that
Non-employee Director shall be 7,500. Options shall be granted at an option
price to be determined by the Committee, subject to the condition that such
price will be equal to or greater than 85 percent of the fair market value of
the Common Stock at the date of grant of the Option. Options granted to
Non-employee Directors shall not be treated as incentive stock options under
Section 422(b) of the Code.

          5.2          Stock Option Agreements. Stock Options shall be evidenced
by stock option agreements and/or certificates of award containing the terms and
conditions applicable to such Stock Options. To the extent not covered by the
stock option agreement, the terms and conditions of this Section 5 shall govern.

          5.3          Stock Option Price. The per share Stock Option price
shall be determined by the Committee, but shall be a price that is equal to or
greater than 100% of the Market Value on the date of grant. The date of grant of
a Stock Option shall be the date the Stock Option is authorized by the Committee
or a future date specified by the Committee as the date for issuing the Stock
Option.

          5.4          Medium and Time of Payment. The exercise price for each
share purchased pursuant to a Stock Option granted under the Plan shall be
payable in cash or, if the Committee consents or provides in the applicable
stock option agreement or grant, in Mature Shares or other consideration
substantially equivalent to cash. The time and terms of payment may be amended
with the consent of a Participant before or after exercise of a Stock Option.
The Committee may implement a program for the broker-assisted cashless exercise
of Stock Options.

          5.5          Stock Options Granted to 10% Shareholders. No Stock
Option granted to any Participant who at the time of such grant owns, together
with stock attributed to such Participant under Section 424(d) of the Code, more
than 10% of the total combined voting power of all classes of stock of the
Company or any of its Subsidiaries may be designated as an incentive stock
option, unless such Stock Option provides an exercise price equal to at least
110% of the Market Value of the Common Stock on the date of grant and the
exercise of the Stock Option after the expiration of five years from the date of
grant of the Stock Option is prohibited by its terms.

          5.6          Limits on Exercisability. Except as set forth in Section
5.5, Stock Options shall be exercisable for such periods, not to exceed 10 years
from the date of grant, as may be fixed by the Committee. At the time of
exercise of a Stock Option, the holder of the Stock Option, if

Exhibit A - Page 8

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requested by the Committee, must represent to the Company that the shares are
being acquired for investment and not with a view to the distribution thereof.
The Committee may in its discretion require a Participant to continue the
Participant's service with the Company and its Subsidiaries for a certain length
of time prior to a Stock Option becoming exercisable and may eliminate such
delayed vesting provisions.

          5.7          Restrictions on Transferability.

          (a)          General. Unless the Committee otherwise consents or
permits (before or after the option grant) or unless the stock option agreement
or grant provides otherwise, Stock Options granted under the Plan may not be
sold, exchanged, transferred, pledged, assigned or otherwise alienated or
hypothecated except by will or the laws of descent and distribution, and, as a
condition to any transfer permitted by the Committee or the terms of the stock
option agreement or grant, the transferee must execute a written agreement
permitting the Company to withhold from the shares subject to the Stock Option a
number of shares having a Market Value at least equal to the amount of any
federal, state or local withholding or other taxes associated with or resulting
from the exercise of a Stock Option. All provisions of a Stock Option that are
determined with reference to the Participant, including without limitation those
that refer to the Participant's employment with the Company or its Subsidiaries,
shall continue to be determined with reference to the Participant after any
transfer of a Stock Option.

          (b)          Other Restrictions. The Committee may impose other
restrictions on any shares of Common Stock acquired pursuant to the exercise of
a Stock Option under the Plan as the Committee deems advisable, including,
without limitation, restrictions under applicable federal or state securities
laws.

          5.8          Termination of Employment, Directorship or Officer
Status. Unless the Committee otherwise consents or permits (before or after the
option grant) or unless the stock option agreement or grant provides otherwise:

          (a)          General. If a Participant ceases to be a director of the
Company or ceases to be employed by or an officer of the Company or one of its
Subsidiaries for any reason other than the Participant's death, disability,
Retirement or termination for cause, the Participant may exercise his or her
Stock Options in accordance with their terms for a period of 3 months after such
termination of employment, directorship or officer status, but only to the
extent the Participant was entitled to exercise the Stock Options on the date of
termination unless the Committee otherwise consents or the terms of the Option
agreement provide otherwise, and not beyond the original terms of the Stock
Options. For purposes of the Plan, the following shall not be considered a
termination of employment, or, where applicable, directorship or officer status:
(i) a transfer of an employee from the Company to any Subsidiary; (ii) a leave
of absence, duly authorized in writing by the Company, for military service or
for any other purpose approved by the Company if the period of such leave does
not exceed 90 days; (iii) a leave of absence in

Exhibit A - Page 9

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excess of 90 days, duly authorized in writing by the Company, provided that the
employee's right to re-employment is guaranteed by statute, contract or written
policy of the Company; (iv) a termination of employment with continued service
as an officer or director; or (v) a termination of a directorship with continued
service as an employee or officer. For purposes of the Plan, termination of
employment shall be considered to occur on the date on which the employee is no
longer obligated to perform services for the Company or any of its Subsidiaries
and the employee's right to re-employment is not guaranteed by statute, contract
or written policy of the Company, regardless of whether the employee continues
to receive compensation from the Company or any of its Subsidiaries after such
date.

          (b)          Death. If a Participant dies either while a director of
the Company or an employee or officer of the Company or one of its Subsidiaries
or after the termination of employment or directorship other than for cause but
during the time when the Participant could have exercised a Stock Option, the
Stock Options issued to such Participant shall be exercisable in accordance with
their terms by the personal representative of such Participant or other
successor to the interest of the Participant for one year after the
Participant's death, but only to the extent that the Participant was entitled to
exercise the Stock Options on the date of death or termination of employment or
directorship, whichever first occurred, and not beyond the original terms of the
Stock Options.

          (c)          Disability. If a Participant ceases to be a director of
the Company or ceases to be an employee or officer of the Company or one of its
Subsidiaries due to the Participant's disability, the Participant may exercise
his or her Stock Options in accordance with their terms for one year following
such termination of employment or directorship, but only to the extent that the
Participant was entitled to exercise the Stock Options on the date of such event
and not beyond the original terms of the Stock Options.

          (d)          Participant Retirement. If a Participant Retires as a
director of the Company or an employee or officer of the Company or one of its
Subsidiaries, Stock Options granted under the Plan may be exercised in
accordance with their terms during the remaining terms of the Stock Options.

          (e)          Termination for Cause. If a Participant is terminated for
cause, the Participant shall have no further right to exercise any Stock Options
previously granted. For purposes of the Plan, the Committee or officers
designated by the Committee shall have absolute discretion to determine whether
a termination is for cause.

          (f)          Additional Provisions in Stock Option Agreements. The
Committee may, in its sole discretion, provide by resolution or by including
provisions in any Stock Option agreement entered into with a Participant that
the Participant shall have no further right to exercise any Stock Options after
termination of employment or directorship if the Committee determines the
Participant has entered into Competition with the Company.

Exhibit A - Page 10

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SECTION 6

Restricted Stock

          6.1          Grant. Subject to the limitations set forth in Sections
4.1 and 4.2 of the Plan, a Participant may be granted Restricted Stock under the
Plan. Restricted Stock shall be subject to such terms and conditions, consistent
with the other provisions of the Plan, as shall be determined by the Committee
in its sole discretion. The Committee may impose such restrictions or
conditions, consistent with the provisions of the Plan, to the vesting of
Restricted Stock as it considers appropriate. The Committee may also require
that certificates representing shares of Restricted Stock be retained and held
in escrow by a designated employee or agent of the Company or any Subsidiary
until any restrictions applicable to shares of Restricted Stock so retained have
been satisfied or lapsed.

          6.2          Restricted Stock Agreements. Awards of Restricted Stock
shall be evidenced by restricted stock agreements or certificates of award
containing such terms and conditions, consistent with the provisions of the
Plan, as the Committee shall from time to time determine. Unless a restricted
stock agreement or certificate provides otherwise, Restricted Stock awards shall
be subject to the terms and conditions set forth in this Section 6.

          6.3          Termination of Employment, Directorship or Officer
Status. Unless the Committee otherwise consents or permits (before or after the
grant of Restricted Stock) or unless the restricted stock agreement or grant
provides otherwise:

          (a)          General. In the event of termination of employment,
directorship or officer status during the Restricted Period for any reason other
than death, disability, Retirement or termination for cause, any shares of
Restricted Stock still subject to restrictions at the date of such termination
shall automatically be forfeited and returned to the Company. For purposes of
the Plan, the following shall not be considered a termination of employment, or,
where applicable, directorship or officer status: (i) a transfer of an employee
from the Company to any Subsidiary; (ii) a leave of absence, duly authorized in
writing by the Company, for military service or for any other purpose approved
by the Company if the period of such leave does not exceed 90 days; (iii) a
leave of absence in excess of 90 days duly authorized in writing by the Company,
provided that the employee's right to re-employment is guaranteed by statute,
contract or written policy of the Company; (iv) a termination of employment with
continued service as an officer or director; or (v) a termination of a
directorship with continued service as an employee or officer. For purposes of
the Plan, termination of employment shall be considered to occur on the date on
which the employee is no longer obligated to perform services for the Company or
any of its Subsidiaries and the employee's right to re-employment is not
guaranteed by statute, contract or written policy of the Company,

Exhibit A - Page 11

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regardless of whether the employee continues to receive compensation from the
Company or any of its Subsidiaries after such date.

          (b)          Death, Retirement or Disability. In the event a
Participant terminates his or her employment or directorship with the Company
because of death, disability or Retirement during the Restricted Period, the
restrictions applicable to the shares of Restricted Stock shall terminate
automatically with respect to that number of shares (rounded to the nearest
whole number) equal to the total number of shares of Restricted Stock granted to
such Participant multiplied by the number of full months that have elapsed since
the date of grant divided by the total number of full months in the Restricted
Period. All remaining shares shall be forfeited and returned to the Company;
provided, that the Committee may, in its sole discretion, waive the restrictions
remaining on any or all such remaining shares of Restricted Stock either before
or after the death, disability or Retirement of the Participant.

          (c)          Termination for Cause. If a Participant's employment or
directorship is terminated for cause, the Participant shall have no further
right to exercise or receive any Restricted Stock and all Restricted Stock still
subject to restrictions at the date of such termination shall automatically be
forfeited and returned to the Company. For purposes of the Plan, the Committee
or officers designated by the Committee shall have absolute discretion to
determine whether a termination is for cause.

          6.4          Restrictions on Transferability.

          (a)          General. Unless the Committee otherwise consents or
permits or unless the terms of the restricted stock agreement or grant provide
otherwise: (i) shares of Restricted Stock shall not be sold, exchanged,
transferred, pledged, assigned or otherwise alienated or hypothecated during the
Restricted Period except by will or the laws of descent and distribution; and
(ii) all rights with respect to Restricted Stock granted to a Participant under
the Plan shall be exercisable during the Participant's lifetime only by such
Participant, his or her guardian or legal representative.

          (b)          Other Restrictions. The Committee may impose other
restrictions on any shares of Common Stock acquired pursuant to an award of
Restricted Stock under the Plan as the Committee considers advisable, including,
without limitation, restrictions under applicable federal or state securities
laws.

          6.5          Legending of Restricted Stock. Any certificates
evidencing shares of Restricted Stock awarded pursuant to the Plan shall bear
the following legend:

> The shares represented by this certificate were issued subject to certain
> restrictions under the Spartan Motors, Inc. Stock Option and Restricted Stock
> Plan of 2003 (the "Plan"). This certificate is held subject to the terms and
> conditions contained in a restricted stock agreement that includes a
> prohibition

Exhibit A - Page 12

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> against the sale or transfer of the stock represented by this certificate
> except in compliance with that agreement and that provides for forfeiture upon
> certain events. Copies of the Plan and the restricted stock agreement are on
> file in the office of the Secretary of the Company.

          6.6          Rights as a Shareholder. A Participant shall have all
voting, dividend, liquidation and other rights with respect to Restricted Stock
held of record by such Participant as if the Participant held unrestricted
Common Stock; provided, that the unvested portion of any award of Restricted
Stock shall be subject to any restrictions on transferability or risks of
forfeiture imposed pursuant to Sections 6.1, 6.3 and 6.4 of the Plan. Unless the
Committee otherwise determines or unless the terms of the restricted stock
agreement or grant provide otherwise, any noncash dividends or distributions
paid with respect to shares of unvested Restricted Stock shall be subject to the
same restrictions as the shares to which such dividends or distributions relate.

SECTION 7

Change in Control

          7.1          Acceleration of Vesting. If a Change in Control of the
Company shall occur, then, unless the Committee or the Board otherwise
determines with respect to one or more Incentive Awards, without action by the
Committee or the Board: (a) all outstanding Stock Options shall become
immediately exercisable in full and shall remain exercisable during the
remaining terms thereof, regardless of whether the Participants to whom such
Stock Options have been granted remain in the employ or service of the Company
or any Subsidiary; and (b) all other outstanding Incentive Awards shall become
immediately fully vested and exercisable and nonforfeitable.

          7.2          Cash Payment for Stock Options. If a Change in Control of
the Company shall occur, then the Committee, in its sole discretion, and without
the consent of any Participant affected thereby, may determine that some or all
Participants holding outstanding Stock Options shall receive, with respect to
some or all of the shares of Common Stock subject to such Stock Options, as of
the effective date of any such Change in Control of the Company, cash in an
amount equal to the greater of the excess of (a) the highest sales price of the
shares on Nasdaq on the date immediately prior to the effective date of such
Change in Control of the Company or (b) the highest price per share actually
paid in connection with any Change in Control of the Company over the exercise
price per share of such Stock Options.

Exhibit A - Page 13

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SECTION 8

General Provisions

          8.1          No Rights to Awards. No Participant or other person shall
have any claim to be granted any Incentive Award under the Plan and there is no
obligation of uniformity of treatment of Participants or holders or
beneficiaries of Incentive Awards under the Plan. The terms and conditions of
Incentive Awards of the same type and the determination of the Committee to
grant a waiver or modification of any Incentive Award and the terms and
conditions thereof need not be the same with respect to each Participant or the
same Participant.

          8.2          Withholding. The Company or a Subsidiary shall be
entitled to: (a) withhold and deduct from future wages of a Participant (or from
other amounts that may be due and owing to a Participant from the Company or a
Subsidiary), or make other arrangements for the collection of, all legally
required amounts necessary to satisfy any and all federal, state, local and
foreign withholding and employment-related tax requirements attributable to an
Incentive Award, including, without limitation, the grant, exercise or vesting
of, or payment of dividends with respect to, an Incentive Award or a
disqualifying disposition of Common Stock received upon exercise of an incentive
stock option; or (b) require a Participant promptly to remit the amount of such
withholding to the Company before taking any action with respect to an Incentive
Award. Unless the Committee determines otherwise, withholding may be satisfied
(but only to the extent required to satisfy the minimum amount required to be
withheld by law or regulation) by withholding Common Stock to be received upon
exercise or vesting of an Incentive Award or by delivery to the Company of
previously owned Common Stock.

          8.3          Compliance With Laws; Listing and Registration of Shares.
All Incentive Awards granted under the Plan (and all issuances of Common Stock
or other securities under the Plan) shall be subject to all applicable laws,
rules and regulations, and to the requirement that if at any time the Committee
shall determine, in its discretion, that the listing, registration or
qualification of the shares covered thereby upon any securities exchange or
under any state or federal law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in connection
with, the grant of such Incentive Award or the issue or purchase of shares
thereunder, such Incentive Award may not be exercised in whole or in part, or
the restrictions on such Incentive Award shall not lapse, unless and until such
listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Committee.

          8.4          No Limit on Other Compensation Arrangements. Nothing
contained in the Plan shall prevent the Company or any Subsidiary from adopting
or continuing in effect other or additional compensation arrangements, including
the grant of stock options and other stock-based awards, and such arrangements
may be either generally applicable or applicable only in specific cases.

Exhibit A - Page 14

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          8.5          No Right to Employment. The grant of an Incentive Award
shall not be construed as giving a Participant the right to be retained in the
employ or directorship of the Company or any Subsidiary. The Company or any
Subsidiary may at any time dismiss a Participant from employment and a
directorship may be terminated consistent with the Company's Restated Articles
of Incorporation and Bylaws, free from any liability or any claim under the
Plan, unless otherwise expressly provided in the Plan or in any written
agreement with a Participant.

          8.6          Suspension of Rights under Incentive Awards. The Company,
by notice to a Participant, may suspend a Participant's and any transferee's
rights under any Incentive Award for a period not to exceed 60 days while the
termination for cause of that Participant's employment or directorship with the
Company and its Subsidiaries is under consideration.

          8.7          Governing Law. The validity, construction and effect of
the Plan and any rules and regulations relating to the Plan shall be determined
in accordance with the laws of the State of Michigan and applicable federal law.

          8.8          Severability. In the event any provision of the Plan
shall be held illegal or invalid for any reason, the illegality or invalidity
shall not affect the remaining provisions of the Plan and the Plan shall be
construed and enforced as if the illegal or invalid provision had not been
included, unless such construction would cause the Plan to fail in its essential
purposes.

SECTION 9

Termination and Amendment

          The Board may terminate the Plan at any time or may from time to time
amend the Plan as it considers proper and in the best interests of the Company,
provided that no such amendment may impair any outstanding Incentive Award
without the consent of the Participant, except according to the terms of the
Plan or the Incentive Award. No termination, amendment or modification of the
Plan shall become effective with respect to any Incentive Award previously
granted under the Plan without the prior written consent of the Participant
holding such Incentive Award unless such amendment or modification operates
solely to the benefit of the Participant.

SECTION 10

Effective Date and Duration of the Plan

          This Plan shall take effect April 22, 2003, subject to approval by the
shareholders at the 2003 Annual Meeting of Shareholders or any adjournment
thereof or at a Special Meeting of Shareholders. Unless earlier terminated by
the Board of Directors, no Incentive Award shall be granted under the Plan after
April 21, 2013.

Exhibit A - Page 15

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