Exhibit (10)(k)

                                  AMENDMENT TO
                              CAVALIER HOMES, INC.
                     1996 KEY EMPLOYEE STOCK INCENTIVE PLAN

                  As directed by the Board of Directors of Cavalier Homes,  Inc.
(the  "Company") at its meeting held on January 23, 1998, the Company's 1996 Key
Employee Stock  Incentive  Plan, as amended from time to time, is hereby further
amended in order to provide for the first  paragraph of Section 4.1 and Sections
4.1.1 through a new Section 4.1.4 thereof to read as follows:

                  4.1  Number of Shares  Available  for  Grants.  The  number of
                  Shares  reserved  for grants of Awards under the Plan shall be
                  equal to the sum of:

                  4.1.1  Six Hundred Thousand (600,000) Shares; and

                  4.1.2  one  and  one-half   percent  (1.5%)  of   the   Shares
                  outstanding   as  of  January  1,  1997  and  each  January  1
                  thereafter;  provided, however, that following the addition of
                  Shares  under this  provision  that occurs on January 1, 2001,
                  this  provision  shall not  thereafter  permit the addition of
                  Shares  to the  Plan  for the  purpose  of  making  Awards  of
                  Options; and

                  4.1.3  such  number  of  Shares  reserved  for  issuance under
                  the  Prior  Plans  in  excess  of  the  number of Shares as to
                  which options have been awarded thereunder as of the Effective
                  Date  including  any  Shares  subject  to  options  previously
                  granted  under the Prior Plans which  hereafter  shall  lapse,
                  expire, terminate or be canceled; and

                  4.1.4  such  number  of  Shares  as  equals  (i)   the  number
                  of  shares  of  the  common  stock  of  Belmont  Homes,  Inc.,
                  ("Belmont   Shares")  reserved  at  the  effective  time  (the
                  "Effective  Time") of the  merger  (the  "Merger")  of Crimson
                  Acquisition  Corp.  ("Crimson")  with and into Belmont  Homes,
                  Inc.  ("Belmont") for issuance  pursuant to ungranted  options
                  under the Belmont  1994  Incentive  Stock Plant (the  "Belmont
                  Stock Plan"),  plus (ii) the number of Belmont  Shares subject
                  to  outstanding  options  under the  Belmont  Stock Plan which
                  lapse,  terminate,   expire  or  are  canceled  following  the
                  Effective  Time  (pursuant to the express terms of the options
                  and the Belmont  Stock Plan and not  pursuant to any action by
                  the Company,  Belmont or  Crimson),  with each such numbers of
                  Belmont  Shares in each case being  multiplied by the exchange
                  ratio in the Merger of 0.80.


                                                       /s/ BARRY B. DONNELL
                                                   -----------------------------
                                                           Barry B. Donnell