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                                                              EXHIBIT (10)(B)(3)

                               THIRD AMENDMENT TO
                                CREDIT AGREEMENT

    THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Third Amendment") is dated
as of December 15, 1997, and is entered into by and among K2 Inc., a Delaware
corporation (the "Borrower"), the financial institutions listed on the signature
pages hereto (the "Banks"), Bank of America National Trust and Savings
Association, as Issuing Bank (in such capacity, the "Issuing Bank"), Bank of
America National Trust and Savings Association, as Swing Line Bank (in such
capacity, the "Swing Line Bank"), and Bank of America National Trust and Savings
Association, as the agent for the Banks (in such capacity, the "Agent") and
amends that certain Credit Agreement dated as of May 21, 1996 among the
Borrower, the Banks, the Issuing Bank, the Swing Line Bank and the Agent, as
amended by a First Amendment to Credit Agreement dated as of March 10, 1997 and
a Second Amendment to Credit Agreement dated as of April 18, 1997 (as so
amended, the "Agreement").

                                    RECITAL

    The Borrower has requested, and the Banks, the Issuing Bank, the Swing Line
Bank and the Agent are willing, to amend the Agreement on the terms and
conditions set forth herein.

    NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereby agree as follows:

    1.  TERMS.  All terms used herein shall have the same meanings as in the
Agreement unless otherwise defined herein. All references to the Agreement shall
mean the Agreement as hereby amended.

    2.  AMENDMENTS TO AGREEMENT.  The Borrower, the Banks, the Issuing Bank, the
Swing Line Bank and the Agent hereby agree that the Agreement is amended as
follows:

    2.1 Section 9.14(a)(5) of the Agreement is amended by deleting "$30,000,000"
and inserting "$50,000,000" in lieu thereof.

    2.2 Section 9.12 of the Agreement is amended by deleting ".50 to 1.00" and
inserting ".55 to $1.00" in lieu thereof.

    3.  REPRESENTATIONS AND WARRANTIES.  The Borrower represents and warrants to
Banks, the Issuing Bank, the Swing Line Bank and Agent that, on and as of the
date hereof, after giving effect to this Third amendment.

    3.1  AUTHORIZATION.  The execution, delivery and performance of this Third
Amendment have been duly authorized by all necessary corporate action by the
Borrower and this Third Amendment has been duly executed and delivered by the
Borrower.

    3.2  BINDING OBLIGATION.  This Third Amendment is the legal, valid and
binding obligation of Borrower, enforceable against the Borrower in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally or by equitable principles relating to enforceability.

    3.3  NO LEGAL OBSTACLE TO AMENDMENT.  The execution, delivery and
performance of this Third Amendment will not (a) contravene the terms of the
Borrower's certificate of incorporation, by-laws or other organization document;
(b) conflict with or result in any breach or contravention of the provisions of
any contract to which the Borrower is a party, or the violation of any law,
judgment, decree or governmental order, rule or regulation applicable to
Borrower, or result in the creation under any agreement or instrument of any
security interest, lien, charge, or encumbrance upon any of the assets of the
Borrower. No approval or authorization of any governmental authority is required
to permit the execution, delivery or performance by the Borrower of this Third
Amendment, or the transactions contemplated hereby.

    3.4  INCORPORATION OF CERTAIN REPRESENTATIONS.  The representations and
warranties of the Borrower set forth in Section 7 of the Agreement are true and
correct in all respects on and as of the date hereof as
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though made on and as of the date hereof, except as to such representations made
as of an earlier specified date.

    3.5  DEFAULT.  No default or Event of Default under the Agreement has
occurred and is continuing.

    4.  MISCELLANEOUS.

    4.1  EFFECTIVENESS OF AGREEMENT.  Except as hereby expressly amended, the
Agreement and each other Loan Document shall each remain in full force and
effect, and are hereby ratified and confirmed in all respects on and as of the
date hereof.

    4.2  WAIVERS.  This Third Amendment is specific in time and in intent and
does not constitute, nor should it be construed as, a waiver of any other right,
power or privilege under the Loan Documents, or under any agreement, contract,
indenture, document or instrument mentioned in the Loan Document; nor does it
preclude any exercise thereof or the exercise of any other right, power or
privilege, nor shall any future waiver of any right, power, privilege or default
hereunder, or under any agreement, contract, indenture, document or instrument
mentioned in the Loan Documents, constitute a waiver of any other default of the
same or of any other term or provision.

    4.3  COUNTERPARTS.  This Third Amendment may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument. This Third Amendment shall not become
effective until the Borrower, the Banks, the Issuing Bank, the Swing Line Bank
and the Agent shall have signed a copy hereof, whether the same or counterparts,
and the same shall have been delivered to the Agent.

    4.4  JURISDICTION.  This Third Amendment shall be governed by and construed
under the laws of the State of California.

    IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to
be duly executed and delivered as of the date first written above.

                                          K2 INC.

                                          /s/ JOHN J. RANGEL
                                          --------------------------------------
                                          By John J. Rangel
                                          Senior Vice President-Finance

                                          BANK OF AMERICA NATIONAL
                                          TRUST AND SAVINGS ASSOCIATION,
                                          as Agent

                                          BANK OF AMERICA NATIONAL
                                          TRUST AND SAVINGS ASSOCIATION,
                                          as Swing Line Bank, Issuing Bank and
                                          Bank

                                          /s/ THERESE FONTAINE
                                          --------------------------------------
                                          Therese Fontaine
                                          Vice President

                                          NATIONSBANK OF TEXAS, N.A.