THIRD AMENDMENT TO AMENDED AND RESTATED
                          CREDIT AND SECURITY AGREEMENT

     This third  Amendment  to the  Amended  and  Restated  Credit and  Security
Agreement ("Third  Amendment") is dated effective January 1, 1998, and is by and
between the following identified parties:  Featherlite Mfg., Inc., a corporation
duly  organized  and validly  exising  under the laws of the State of Minnesota,
with  its  principal  place of  business  at Hwy.  63 & 9,  Cresco,  Iowa  52136
("Borrower");  Conrad Clement, Larry Clement, Kathy Clement,  residents of Iowa,
and Tracy Clement and Nancy Clement,  residents of Minnesota  (the  "Clements");
and FirstarBank Iowa, N.A., a national banking institution ("Bank").

RECITALS

     A. Borrower,  Clements and Bank entered into an Amended and Restated Credit
and Security  Agreement  dated as of December 30, 1996  ("Restated  Agreement"),
which  was  amended  by a First  Amendment  dated  June 18,  1997,  and a Second
Amendment dated July 31, 1997.

     B. Borrower has requested  that the Bank amend certain terms and conditions
in the Restated Agreement, and waive certain financial covenants

     C. Bank is willing to grant the request  subject to the terms of this Third
Amendment.

     The parties agree:

     1. Amended Negative Covenants.

     (a) Section 9, Negative Covenants,  subpart (b) (iv) is amended to allow up
to $10,000,000 in floor plan financing for the Vantare Division.

     (b)  Section  9,  Negative  Covenants,  subpart  (f ) is amended to add the
following at the end of the sentence, "provided, however, Borrower may invest up
$200,000 in Featherlite/GMR Sports Group, L.L.C."

     2.  Representations and Warranties.  All the representations and warranties
of Borrower as set forth in the Restated  Agreement  are true and correct in all
material respects as of the date of this Third Amendment.

     3.  Acknowledgment of Receipt.  By their execution of this Third Amendment,
the parties acknowledge receipt of a copy of this document.


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     4. Savings.  All other terms and conditions of the Restated Agreement,  not
specifically  modified by this Third  Amendment,  shall remain in full force and
effect.

     5.  Representation.  The Borrower  represents  that no Event of Default has
occurred and is  continuing  under the Restated  Agreement,  as amended,  and no
event or  circumstance  has occurred and is continuing  that, with the giving of
notice, the passage of time, or both, would constitute an Event of Default under
the Restated Agreement,  as amended.  Further,  the Borrower represents that the
representations  and  warranties  as  contained in the  Restated  Agreement,  as
amended, continue to be true.

     6.  Counterparts.  This Third  Amendment  may be  executed in any number of
counterparts,  each of which shall be deemed to be an original, but all of which
together shall constitute but one and the same instrument.

IMPORTANT:  READ  BEFORE  SIGNING.  THE TERMS OF THIS  AMENDMENT  SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR
ORAL  PROMISES  NOT  CONTAINED IN THIS  WRITTEN  AGREEMENT  (EXCEPT THE RESTATED
AGREEMENT  AS  PREVIOUSLY  AMENDED AND  DOCUMENTS  REFERRED  TO IN THE  RESTATED
AGREEMENT AS  PREVIOUSLY  AMENDED) MAY BE LEGALLY  ENFORCED.  YOU MAY CHANGE THE
TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.

FEATHERLILTE MFG., INC.

BY: /s/ Conrad Clement
Conrad Clement, President

BY: /s/ Tracy J. Clement
Tracy J. Clement, Executive Vice President

FIRSTAR BANK IOWA, N.A.

BY: /s/ Mitch McElree
Mitch McElree, Vice President