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Contact:
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Mike
Murphy
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Chief
Financial Officer
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(256)
747-9800
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CAVALIER
HOMES AND CAVALIER HOMES COMMITTEE FOR CHANGE SETTLE PROXY CONTEST
CURTIS
D. HODGSON AND KENNETH E. SHIPLEY SELECTED TO JOIN
THE
COMPANY'S BOARD OF DIRECTORS
2009
ANNUAL MEETING DATE RESET FOR MAY 26, 2009
Addison,
Ala. (May 14, 2009) – Cavalier Homes, Inc. (NYSE Amex: CAV) and the members of
the Cavalier Homes Committee for Change including Legacy Housing, LTD., Shipley
Brothers, LTD., Curtis D. Hodgson, Kenneth E. Shipley, and certain of their
affiliates, which beneficially own approximately 9.6% of Cavalier's outstanding
shares of common stock, today announced that they have reached an agreement to
settle the proxy contest relating to Cavalier's 2009 Annual Meeting of
Stockholders.
Under the
terms of the agreement, Cavalier has increased the size of its Board from eight
to 10 directors and appointed Curtis D. Hodgson and Kenneth E. Shipley to serve
as directors of the Company for a term to end no earlier than the Company's 2009
Annual Meeting of Stockholders. Cavalier also has agreed that at its
2009 Annual Meeting, the Company will nominate Hodgson and Shipley, along with
the other members of its Board of Directors, for election as directors of the
Company for terms expiring at the Company's 2010 Annual Meeting or until their
successors are duly elected and qualified.
As a
condition of the agreement, the members of the Committee will end their efforts
to elect Michael R. O'Connor to the Board and have agreed to immediately cease
all efforts related to their own proxy solicitation.
In
addition, Cavalier has agreed to reimburse the members of the Committee for its
actual out-of-pocket expenditures relating to the proxy contest, up to a maximum
reimbursable amount of $200,000. Both Cavalier and the members of the
Committee also have agreed to a mutual release of claims in connection with the
proxy contest.
In order
to allow adequate time for the Company to notify its stockholders of its newly
proposed slate of 10 directors, Cavalier has postponed the 2009 Annual Meeting
of Stockholders until May 26, 2009, beginning at 2:00 P.M., Central
Daylight Time, at The Summit Club at the Regions-Harbert Plaza, 1901 6
th
Avenue
North, Suite 3100, Birmingham, Alabama 35203.
CAV
Settles Proxy Contest
Page
2
May 14,
2009
"We are
pleased to announce this mutually beneficial compromise with the Cavalier Homes
Committee for Change," said Barry B. Donnell, Chairman of the Board of Directors
of Cavalier. "This solution allows us to retain experienced and
dedicated board members that we believe have contributed to our past success,
and who will continue to play an important role in guiding Cavalier in the
challenging times ahead. At the same time, it provides for the
inclusion of differing viewpoints and alternative thinking put forward by
capable and experienced members of the Committee, which we think is a healthy
part of our corporate governance objectives."
Curtis D.
Hodgson endorsed the settlement as well, saying, "We are very pleased with this
settlement. It is time to end this proxy contest and redirect all of
our efforts to creating value for stockholders. We believe numerous
opportunities exist to unlock value in Cavalier shares. We look
forward to working closely with the other members of the Board and believe our
direct industry experience will significantly strengthen the
Board."
Cavalier
Homes, Inc. and its subsidiaries produce and sell manufactured
housing. The Company markets its homes primarily through independent
dealers, including exclusive dealers that carry only Cavalier
products.
Important
Information
Cavalier
has filed a proxy statement in connection with its 2009 Annual Meeting of
Stockholders. The Company's stockholders are strongly advised to read the
proxy statement and the accompanying WHITE proxy card, as they contain important
information, including information relating to the participants in such proxy
solicitation. Stockholders can obtain this proxy statement, any
amendments or supplements to the proxy statement and other documents filed by
Cavalier with the SEC for free at the internet website maintained by the SEC at
www.sec.gov
and
Cavalier's website at
www.cavhomesinc.com
.
With the
exception of historical information, the statements made in this press release,
including those containing the words "expects," "anticipates," "thinks" and
"believes," and words of similar import, and those relating to industry trends
and conditions, Cavalier's expectations for its results of operations during the
most recent fiscal quarter and in future periods, acceptance of Cavalier's new
product initiatives and the effect of these and other steps taken in the last
several years on Cavalier's future sales and earnings, the use of Cavalier's
cash to fund inventory financing programs, and Cavalier's plans and expectations
for addressing current and future industry and business conditions, constitute
forward-looking statements, are based upon current expectations, and are made
pursuant to the "Safe Harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements involve certain known and
unknown assumptions, risks and uncertainties that could cause actual results to
differ materially from those included in or contemplated by the statements,
including among other matters, significant competitive activity, including
promotional and price competition; interest rates; increases in raw material and
energy costs; changes in customer demand for Cavalier's products; inherent risks
in the market place associated with new products and new product lines; the
impact to Cavalier and the industry from changes in lending programs or the
termination of lending programs by national lenders, and other risk factors
listed from time to time in Cavalier's reports filed with the Securities and
Exchange Commission, including, but not limited to, those discussed or indicated
in Cavalier's Annual Report on Form 10-K for the period ended December 31,
2008, under the heading "Item 1A. Risk Factors," and its Quarterly Report on
Form 10-Q for the period ended March 28, 2009, under the heading "Cautionary
Factors That May Affect Future Results," as filed with the Securities and
Exchange Commission. Cavalier disclaims any obligation to update any
forward-looking statements as a result of developments occurring after the
issuance of this press release.
-END-