May 14,
2009
Dear
Stockholder:
We are
pleased to advise you that Cavalier Homes, Inc. (the “Company”) and the members
of the Cavalier Homes Committee for Change (the “Committee”) including Legacy
Housing, LTD., GPLH, LC, Shipley Brothers, LTD., K-Shipley, LLC, D-Shipley, LLC,
B-Shipley, LLC, Federal Investors Servicing, LTD., Federal Investors Management,
L.C., Kenneth E. Shipley, Curtis D. Hodgson, Douglas M. Shipley, Billy G.
Shipley and Michael R. O’Connor (each, a “Committee Member” and collectively,
the “Committee Members”) recently entered into an agreement (the “Settlement
Agreement”) to settle the proxy contest pertaining to the election of directors
to the Company’s Board of Directors (the “Board”) at the Company’s 2009 annual
meeting of stockholders (the “Annual Meeting”), which is now scheduled for
Tuesday, May 26, 2009.
Under the
Settlement Agreement, which is described in the accompanying supplement (the
“Supplement”) to the Company’s proxy statement dated April 7, 2009, the
Committee terminated its solicitation of proxies in support of its three Board
nominees, the Company agreed to expand the Board to ten members and name both
Curtis D. Hodgson and Kenneth E. Shipley to the Board effective May 13, 2009 and
the Company agreed to propose both Mr. Hodgson and Mr. Shipley as nominees for
election as directors at the Company’s 2009 Annual Meeting.
The
Board’s nominees for election as directors at the Annual Meeting are: Thomas A.
Broughton, III, Barry B. Donnell, Curtis D. Hodgson, Lee Roy Jordan, Jonathan B.
Lowe, Kenneth E. Shipley, Kenneth J. Smith, Bobby Tesney, Carl S. Thigpen and J.
Don Williams.
The Board of
Directors urges you to elect the ten nominees recommended by the Board by voting
on the enclosed WHITE proxy card.
The WHITE proxy card enclosed with this
Supplement differs from the white proxy card previously furnished to you by the
Company in that the enclosed WHITE proxy card includes the names of all ten (10)
nominees for director.
Due to
the timing of the Settlement, the Company will delay the date of the Annual
Meeting to Tuesday, May 26, 2009 at 2 p.m. local time. The location of the
Annual Meeting has been moved to The Summit Club, 1901 6
th
Avenue
North, Suite 3100, Birmingham, Alabama.
Please
review the Supplement, regardless of whether you voted on a card previously
supplied by the Company or the Committee. The Board of Directors of the Company
and the Committee join in supporting the slate of nominees set forth in the
Supplement.
In order to cast
your vote for these nominees, please sign, date and mail the enclosed WHITE
proxy card.
If
you have questions about voting your shares, please call Morrow & Co., LLC
toll-free at
(800) 607-0088.
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Sincerely
yours,
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/s/ BARRY
B. DONNELL
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/s/ BOBBY
TESNEY
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Barry
B. Donnell
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Bobby
Tesney
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Chairman of the
Board
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Chief
Executive Officer
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YOUR
VOTE IS IMPORTANT. TO ASSURE YOUR REPRESENTATION AT THE ANNUAL
MEETING, PLEASE SIGN AND DATE THE ENCLOSED WHITE PROXY CARD AND RETURN IT
TODAY IN THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID ENVELOPE.
CAVALIER
HOMES, INC.
POST
OFFICE BOX 540
32
WILSON BOULEVARD 100
ADDISON,
ALABAMA 35540
___________________
Supplement
To Proxy Statement
Annual
Meeting of Stockholders
To
be held on May 26, 2009
at
The
Summit Club
1901
6
th
Avenue North
Suite
3100
Birmingham,
Alabama
This
supplement (the “Supplement”) supplements and amends the proxy statement dated
April 7, 2009 (the “Proxy Statement”) of Cavalier Homes, Inc. (the “Company”)
furnished to holders of the Company’s common stock (the “Common Stock”) in
connection with the solicitation of proxies on behalf of the Board of Directors
of the Company (the “Board of Directors” or the “Board”) for use at the Annual
Meeting of Stockholders (the “Annual Meeting”) to be held on May 26, 2009 at 2
p.m., local time, or any adjournment or postponement thereof. The Annual Meeting
location has been changed to The Summit Club, 1901 6
th
Avenue
North, Suite 3100, Birmingham, Alabama. The record date for the determination of
the holders of Common Stock who are entitled to notice of and to vote at the
Annual Meeting is March 27, 2009, which is the same record date specified in the
Proxy Statement. This Supplement, which should be read in conjunction with the
Proxy Statement, is first being mailed to stockholders on or about May 14,
2009.
On May
13, 2009, the Company and the members of the Cavalier Homes Committee for Change
(the “Committee”) including Legacy Housing, LTD., GPLH, LC, Shipley Brothers,
LTD., K-Shipley, LLC, D-Shipley, LLC, B-Shipley, LLC, Federal Investors
Servicing LTD., Federal Investors Management, L.C., Kenneth E. Shipley, Curtis
D. Hodgson, Douglas M. Shipley, Billy G. Shipley and Michael R. O’Connor (each,
a “Committee Member” and collectively, the “Committee Members”), entered into an
agreement (the “Settlement Agreement”) to settle the proxy contest pertaining to
the election of directors to the Board at the Annual Meeting.
Under the
Settlement Agreement, the Committee terminated its solicitation of proxies in
support of its three Board nominees, the Company agreed to expand the Board to
ten members and name both Curtis D. Hodgson and Kenneth E. Shipley to the Board
effective May 13, 2009 and the Company agreed to propose both Mr. Hodgson and
Mr. Shipley as nominees for election as directors at the Company’s 2009 Annual
Meeting. For additional information regarding the Settlement Agreement refer to
the section below captioned “Background.”
The
Board’s nominees for election as directors at the Annual Meeting are: Thomas A.
Broughton, III, Barry B. Donnell, Curtis D. Hodgson, Lee Roy Jordan, Jonathan B.
Lowe, Kenneth E. Shipley, Kenneth J. Smith, Bobby Tesney, Carl S. Thigpen and J.
Don Williams.
The Board of
Directors and the Committee urge you to elect the ten nominees recommended by
the Board by voting on the enclosed WHITE proxy card.
The revised WHITE
proxy card enclosed with this Supplement differs from the white proxy card
previously furnished to you by the Company in that the enclosed WHITE proxy card
includes the names of Messers. Hodgson and Shipley in addition to the Board’s
original eight (8) nominees. The Company and the Committee request that you NOT
vote on any proxy cards previously supplied by the Company or the Committee. If
you have already voted on a proxy card previously supplied by the Company or the
Committee, we request that you
SUBMIT A
NEW
VOTE USING THE ENCLOSED WHITE PROXY
CARD
.
The Board
unanimously recommends that you vote FOR each of the nominees.
In
addition, stockholders are being asked to vote at the Annual Meeting “FOR” the
ratification of the appointment of Carr, Riggs & Ingram, LLC as our
independent registered public accounting firm (Proposal No. 2), as more fully
described in the Proxy Statement.
If you
submit a revised WHITE proxy card, and do not revoke your proxy before it is
voted at the Annual Meeting, your shares will be voted as indicated on that
proxy card.
In all
matters other than the election of directors, abstentions have the same effect
as votes “AGAINST” a matter. Due to the fact that the solicitation for the
Annual Meeting was previously contested, a broker may not be entitled to vote
shares held for a beneficial owner absent instructions from the beneficial
owners of such shares. Thus, if you do not give your broker specific
instructions, your shares may not be voted and, in such event, your shares will
not be counted in determining the number of shares necessary for
approval.
Stockholders
are urged to vote promptly using the enclosed revised WHITE proxy card. You may
change your vote or revoke your proxy at any time before your proxy is voted at
the Annual Meeting. If you are a stockholder of record, you may change your vote
or revoke your proxy by: (1) delivering to Michael R. Murphy, Secretary, at the
address on the first page of this Supplement a written notice of revocation of
your proxy; (2) delivering an authorized proxy bearing a later date; or (3)
attending the Annual Meeting and voting in person. Attendance at the meeting in
and of itself, without voting in person at the meeting, will not cause your
previously granted proxy to be revoked. For shares you hold in street name, you
may change your vote by submitting new voting instructions to your broker, bank
or other nominee or, if you have obtained a legal proxy from your broker, bank
or other nominee giving you the right to vote your shares at the Annual Meeting,
by attending the meeting and voting in person.
For
additional information regarding voting of your shares, refer to the section
below captioned “Voting of Proxies.”
Background
On
January 21, 2009, Curtis D. Hodgson formally notified the Company of his
intention to nominate three nominees for election at the Annual Meeting: Curtis
D. Hodgson, Kenneth E. Shipley and Michael R. O’Connor.
On May
13, 2009, as stated above, the Company and the Committee entered into the
Settlement Agreement. Pursuant to the Settlement Agreement, among other
things:
·
The
Company has agreed (i) to increase the number of seats on its Board to ten, (ii)
to appoint Curtis D. Hodgson and Kenneth E. Shipley (the “Committee Directors”)
to serve as directors of the Company until the 2009 Annual Meeting or until
their successors are duly elected and qualified, and (iii) to nominate the
Committee Directors for election as directors of the Company for terms expiring
at the Company’s 2010 annual meeting of stockholders or until their successors
are duly elected and qualified, subject to the terms of the Settlement
Agreement.
·
The
Company further has agreed not to increase the size of the Board to more than
ten (10) directors at any time prior to the 2010 annual meeting unless approved
by a majority of the independent directors and at least one of the Committee
Directors. The Company and the Committee have agreed that, for a period of two
(2) years, if any non-Committee Director retires from the Board due to reaching
the age of seventy (70), any such vacancy on the Board shall not be
filled.
·
In
the event any Committee Director leaves the Board prior to the 2010 annual
meeting, the Committee shall be entitled to recommend to the Board replacement
director(s), and the Board shall not unreasonably withhold acceptance of any
such replacement director(s).
·
Curtis
D. Hodgson has irrevocably withdrawn his notice to the Company of his intention
to nominate Michael R. O’Connor at the Annual Meeting and the Committee has
agreed to immediately cease all efforts related to its own proxy
solicitation.
·
Within
five (5) business days of receiving reasonable documentation with respect to
such expenses, the Company shall reimburse the Committee an amount equal to the
Committee’s actual out-of-pocket expenses incurred prior to the date of the
Settlement Agreement in connection with the proxy contest, including
the
preparation
of related filings with the Securities and Exchange Commission (the “SEC”) and
the fees and disbursements of counsel and other advisors, up to a maximum
reimbursement of $200,000.
·
Each
Committee Member will cause or instruct the record owner to cause all shares of
the Company’s common stock beneficially owned by them to be present and voted
for all of the directors nominated by the Board for election at the Annual
Meeting.
·
So
long as any of the Committee Directors or their designated replacements are
members of the Board, each of the Committee and each Committee Member agree that
neither they nor any of their respective affiliates will, without consent of the
Board:
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·
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effect,
seek, offer or propose to effect, or cause or participate in, facilitate
or finance, or in any way assist any other person to effect, seek, offer
or propose to effect or participate in any “solicitation” of “proxies” (as
such terms are used in the proxy rules of the SEC) or consent to vote any
voting securities of the Company or conduct any nonbinding referendum with
respect to the Company’s common stock, or make, or in any way participate
in, any “solicitation” of any “proxy” within the meaning of Rule 14a-1
promulgated by the SEC under the Securities Exchange Act of
1934;
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·
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seek
to advise or influence any person with respect to the voting of any
securities of the Company;
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·
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form
or join in a partnership, limited partnership, syndicate or other group,
including without limitation a group as defined under Section 13(d) of the
Securities Exchange Act of 1934, with respect to the Company’s common
stock; and
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·
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initiate,
propose or otherwise “solicit” (as such term is used in the proxy rules of
the SEC) the Company’s stockholders for the approval of stockholder
proposals whether made pursuant to Rule 14a-8 or Rule 14a-4 under the
Exchange Act or otherwise.
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·
The
Committee and the Company agreed to a mutual release of claims arising in
respect of, or in connection with, the nomination and election of directors at
the Annual Meeting.
·
Each
Committee Director agreed that, while serving as directors of the Company and
for a period of one (1) year following his resignation or departure from the
Board, he would not use any confidential information learned in his capacity as
a Board member in any way that would be competitive with the
Company.
The
Company filed a complete copy of the Settlement Agreement with the SEC on May
14, 2009 as Exhibit 10.1 to its Current Report on Form 8-K. The foregoing
description of the Settlement Agreement is qualified in its entirety by
reference to the full text of the Settlement Agreement.
Nominees
Certain
information concerning each of the nominees for director is set forth
below:
Thomas A. Broughton, III,
53,
has served as a member of the Board of Directors since 1986 and serves as
Chairman of the Board’s Compensation Committee. Mr. Broughton currently serves
as President and Chief Executive Officer of ServisFirst Bank and has held that
position since May 2006. Mr. Broughton previously worked at First Commercial
Bank beginning in 1985 and served as its Chairman until August
2005.
Barry B. Donnell,
69,
has served as Chairman
of the Board of Directors since 1986. Mr. Donnell was employed by the Company
from 1986 until December 31, 2004.
Curtis D. Hodgson,
54, was
appointed to the Board of Directors in 2009. Mr. Hodgson (i)
co-founded Legacy Housing, LTD. (“Legacy”) in May 2005, (ii) has served as vice
president and secretary of GLPH, LC (“GLPH”), the general partner of Legacy,
since May 2005 and (iii) has been the sole stockholder and president
of
Cusach,
Inc., a wholesaler and retailer of manufactured homes, since
1980. Mr. Hodgson has a Bachelor of Science degree from the
University of Michigan and received his J.D. from the University of
Texas.
Lee Roy Jordan,
67, has
served as a member of the Board of Directors since 1993. Mr. Jordan was
President of Lee Roy Jordan Redwood Lumber Company, a lumber supply business,
from 1977 until January 2009. He is now retired.
Jonathan B. Lowe,
39, was
appointed to the Board of Directors in 2009 to fill the vacancy created by the
resignation of David A. Roberson in August 2008. Mr. Lowe, a partner with the
law firm of Lowe, Mobley & Lowe, joined the firm in 1994. He graduated from
the University of Alabama with a degree in Accounting and received his J.D. from
Cumberland School of Law. Mr. Lowe also serves as President of the Winston
County Bar Association and is a member of the Alabama State Bar Leadership
Forum.
Kenneth E. Shipley,
50, was
appointed to the Board of Directors in 2009. Mr. Shipley (i)
co-founded Legacy in May 2005, (ii) has served as manager, president and
assistant secretary of GLPH since May 2005, (iii) has served as manager and
president of K-Shipley, the general partner of Shipley Brothers, LTD., since
March 2001, (iv) has served as manager of Federal Investors Management, L.C.,
the general partner of Federal Investors Servicing, LTD., a company that
primarily engages in the business of mobile home financing, since 1990, and (v)
has been the owner and operator of Bell Mobile Homes, a wholesaler and retailer
of manufactured homes in Levelland, Texas, since 1981.
Kenneth J. Smith,
40, was
appointed to the Board of Directors in 2009. Mr. Smith served as President and
Chief Operating Officer of HM Operating, Inc., d/b/a Harden Manufacturing
Company, a furniture manufacturing company, from 2000 until August 2008. He
began his career with Harden Manufacturing Company in 1987 and is currently
retired.
Bobby Tesney,
64, has served
on the Board of Directors since 2003. Mr. Tesney currently serves as our
President and Chief Executive Officer, a position to which he was appointed on
August 15, 2008 following the resignation of David A. Roberson. Mr. Tesney
formerly served as President and Chief Executive Officer of WinsLoew Furniture,
Inc. from October 1994 until January 2002. Following his retirement from
WinsLoew Furniture, Inc., he served as Vice Chairman and Director of Brown
Jordan International, Inc., the successor to WinsLoew Furniture, Inc. until
October 2006.
Carl S. Thigpen
,
52,
was appointed to the
Board of Directors in 2009. Mr. Thigpen has served as Executive Vice President
and Chief Investment Officer of Protective Life Corporation since June 2007.
From January 2002 until June 2007, Mr. Thigpen served as Senior Vice President
and Chief Mortgage and Real Estate Officer of Protective Life Corporation. He
has been employed by Protective Life Corporation since 1984.
J. Don Williams,
59, has
served on the Board of Directors since 2003. Mr. Williams is the owner of J.D.
Williams & Associates, LLC, a management consulting company. Mr. Williams
served as an executive of Altec Industries, Inc., a mobile equipment
manufacturer, from April 1984 until December 2008.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” ALL OF THE ABOVE
NOMINEES.
Annual
Meeting Date and Location
Due to
the timing of the Settlement, the Board of Directors delayed the date of the
Annual Meeting to Tuesday, May 26, 2009 at 2 p.m., local time. The location of
the Annual Meeting has been changed to The Summit Club, 1901 6
th
Avenue
North, Birmingham, Alabama.
Voting of Proxies
If you
wish to vote for the ten nominees listed above, you must do so by voting on the
revised WHITE proxy card enclosed with this Supplement. If you have already
submitted the white proxy card included with the Company’s original Proxy
Statement, or the gold proxy card included with the Committee proxy statement,
you may
revoke it
by subsequently executing the WHITE proxy card enclosed with this Supplement and
returning it in the enclosed pre-addressed postage-paid envelope.
For
shares you hold in street name, you may change your vote by submitting new
voting instructions to your broker, bank or other nominee or, if you have
obtained a legal proxy from your broker, bank or other nominee giving you the
right to vote your shares at the Annual Meeting, by attending the meeting and
voting in person.
If you
submitted or submit an unrevoked WHITE proxy card included with the Company’s
original Proxy Statement, or an unrevoked GOLD proxy card included with the
Committee proxy statement, your shares will not be included in determining
whether or not a quorum is present and will not be counted in tabulating the
number of votes cast on the election of directors or the ratification of the
selection of an independent registered public accounting firm. In that case,
your vote on the WHITE proxy card included with the Company’s original proxy
statement or the GOLD proxy card included with the Committee’s proxy statement
will have no effect on the outcome of the voting.
The Board
of Directors has not received valid notice of any other business that will be
acted upon at the Annual Meeting. If any other business is properly brought
before the Annual Meeting, proxies in the enclosed form will be voted in respect
thereof as the proxy holders deem advisable.
By Order
of the Board of Directors
/s/ MICHAEL R. MURPHY
Michael
R. Murphy
Secretary
May 14,
2009
CAVALIER
HOMES, INC. PROXY
WHITE
PROXY CARD
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The
Board of Directors recommends a vote “FOR” the listed nominees and “FOR” the
following proposal. Please sign, date and return today in the enclosed envelope.
Please mark your vote in blue or black ink.
KNOW ALL MEN BY THESE
PRESENTS
, that the undersigned hereby appoints Bobby Tesney and Michael
R. Murphy, or either of them, proxies of the undersigned, with full power of
substitution, to represent and to vote all shares of common stock of Cavalier
Homes, Inc. which the undersigned would be entitled to vote at the Annual
Meeting of Stockholders of Cavalier Homes, Inc., to be held on Tuesday, May 26,
2009, beginning at 2:00 P.M., Central Daylight Time, at The Summit Club of
Birmingham at the Regions-Harbert Plaza, 1901 6th Avenue North, Suite 3100,
Birmingham, Alabama 35203, in the following manner:
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1.
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ELECTION
OF DIRECTORS
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¨
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FOR
all nominees listed below
(except
as otherwise instructed below)
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¨
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AUTHORITY
WITHHELD
to
vote for all nominees listed below
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Thomas
A. Broughton, III, Barry B. Donnell, Curtis D. Hodgson, Lee Roy Jordan,
Jonathan B. Lowe, Kenneth E. Shipley, Kenneth J. Smith, Bobby Tesney,
Carl S. Thigpen and J. Don Williams
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To
withhold authority to vote for any nominee, write that nominee's name in
the space provided below.
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2.
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PROPOSAL
TO RATIFY AND APPROVE THE APPOINTMENT OF CARR, RIGGS & INGRAM, LLC AS
THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR CAVALIER HOMES,
INC.
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¨
FOR
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¨
AGAINST
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¨
ABSTAIN
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3.
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To
transact any other business that may properly come before the Annual
Meeting.
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(Sign on
the following page)
THIS PROXY WHEN PROPERLY EXECUTED
WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF
NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES
FOR DIRECTOR LISTED ON THE REVERSE SIDE, FOR ITEM 2 AND IN THE DISCRETION OF THE
PERSONS APPOINTED HEREIN UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE
MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF
.
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Dated:
________________________________, 2009
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Signature
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Signature
(if held jointly)
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Title
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Please
sign this proxy exactly as your name appears hereon. In case of joint owners,
each joint owner should sign. When signing as executor, administrator, trustee,
or guardian, please give full title as such. If the signer is a corporation,
please sign full corporate name by duly authorized officer, giving full title as
such. If signer is a partnership, please sign in partnership name by authorized
person.
Please
Date, Sign and Return TODAY in the Enclosed Envelope.
No
Postage Required if Mailed in the United States.