UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
SCHEDULE
14A
(Rule
14a-101)
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
(Amendment
No. ____ )
Filed by
the Registrant
x
Filed by
a Party other than the Registrant
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Check the
appropriate box:
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x
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Preliminary
Proxy Statement
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Confidential,
for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
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Definitive
Proxy Statement
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Definitive
Additional Materials
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Soliciting
Material Pursuant to § 240.14a-12
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CAVALIER
HOMES, INC.
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(Name
of Registrant as Specified In Its Charter)
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(Name
of Person(s) Filing Proxy Statement, if other than the
Registrant)
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Payment
of Filing Fee (Check the appropriate box):
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x
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No
fee required.
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¨
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
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(1)Title
of each class of securities to which transaction applies:
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(2)Aggregate
number of securities to which transaction applies:
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(3)Per
unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4)Proposed
maximum aggregate value of transaction:
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(5)Total
fee paid:
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Fee
paid previously with preliminary materials.
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Check
box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
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(1)Amount
Previously Paid:
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(2)Form,
Schedule or Registration Statement No.:
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(3)Filing
Party:
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(4)Date
Filed:
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April
[6], 2009
Dear
Stockholder:
You are
cordially invited to join us at our 2009 Annual Meeting of Stockholders to be
held on Tuesday, May 19, 2009, beginning at 11:00 A.M., Central Daylight Time,
at the Company’s office at 32 Wilson Boulevard 100, Addison, Alabama 35540. At
the meeting, we will consider the election of directors, the selection by the
Board of Directors of Carr, Riggs & Ingram, LLC as the independent
registered public accounting firm for us and any other business as may properly
come before the Annual Meeting.
This
year’s Annual Meeting is a particularly important one and YOUR vote is extremely
important.
As you
may be aware, earlier this year Legacy Housing, LTD. (“
Legacy
”) notified us
of its intent to nominate and, together with Curtis D. Hodgson (“
Mr. Hodgson
”),
Shipley Brothers, LTD. (“
Shipley
”) and certain
of their affiliates (collectively with Legacy, Mr. Hodgson and Shipley, the
“
Legacy
Group
”), solicit proxies for the election of three candidates to our
Board of Directors at the Annual Meeting in opposition to the eight nominees
that our Board of Directors and our Nominating and Governance Committee have
selected.
Your Board of
Directors has not approved or endorsed the nominees of the Legacy Group and
strongly urges you not to sign or return any proxy card that the Legacy Group
may send to you. Your Board of Directors unanimously recommends that you vote
FOR the Board’s eight nominees, Thomas A. Broughton, III, Barry B. Donnell, Lee
Roy Jordan, Jonathan B. Lowe, Kenneth J. Smith, Bobby Tesney, Carl S. Thigpen
and J. Don Williams, using the enclosed WHITE proxy card.
Our
stockholders who are unable to attend the Annual Meeting may vote by proxy. The
enclosed Notice and Proxy Statement contain important information concerning the
matters to be considered, and we urge you to review them carefully. You will
also find enclosed a copy of our Annual Report for the year ended December 31,
2008, which we encourage you to read.
Our Board of Directors unanimously
recommends that you vote FOR the Board’s eight nominees using the enclosed WHITE
proxy card. We strongly urge you not to sign or return any proxy card that the
Legacy Group may send to you.
Even if you have previously signed and
returned a proxy card sent to you by the Legacy Group, you may revoke it by
signing, dating and returning the enclosed WHITE proxy card with the
instructions in the enclosed proxy statement.
It is
important that your shares be voted at the meeting. Accordingly, whether or not
you plan to attend the Annual Meeting, please complete, sign, date and return
the enclosed WHITE proxy card promptly so that we may be assured of the presence
of a quorum. If you attend the meeting and wish to vote your shares personally,
you may revoke your proxy.
We look
forward to seeing you on May 19
th
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Sincerely
yours,
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CAVALIER
HOMES, INC.
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Bobby
Tesney
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Barry
B. Donnell
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President
and Chief Executive Officer
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Chairman
of the Board of Directors
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CAVALIER
HOMES, INC.
_____________________
Notice
of Annual Meeting of Stockholders
To
be held May 19, 2009
_____________________
TO THE
STOCKHOLDERS OF CAVALIER HOMES, INC.:
The
Annual Meeting of Stockholders of Cavalier Homes, Inc., a Delaware corporation
(“
we
,” “
us
,” “
our
,” the “
Company
” or “
Cavalier
”), will be
held at the Company’s office at 32 Wilson Boulevard 100, Addison, Alabama 35540
on Tuesday, May 19, 2009, at 11:00 A.M., Central Daylight Time, for the
following purposes:
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(1)
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To
elect eight directors;
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(2)
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To
consider the ratification and approval of the appointment by the Board of
Directors of Carr, Riggs & Ingram, LLC as the independent registered
public accounting firm for the Company;
and
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(3)
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To
transact such other business as may properly come before the
meeting.
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Details
respecting these matters are set forth in the accompanying Proxy
Statement.
Our
Board of Directors unanimously recommends that you vote FOR the Board’s eight
nominees and FOR the ratification of Carr, Riggs & Ingram, LLC as the
Company’s independent registered public accounting firm using the enclosed WHITE
proxy card.
Holders
of record of our common stock at the close of business on March 27, 2009, are
entitled to notice of and to vote at the Annual Meeting. A list of our
stockholders who are entitled to vote at the Annual Meeting will be available
for inspection for a period of ten days prior to the Annual Meeting at 32 Wilson
Boulevard 100, Addison, Alabama, and at the Annual Meeting, for any purpose
germane to the meeting. The meeting may be adjourned from time to time without
notice other than such notice as may be given at the meeting or any adjournment
thereof, and any business for which notice is hereby given may be transacted at
any such adjourned meeting.
Important
Notice Regarding the Availability of Proxy Materials
For
the Annual Meeting to be Held on May 19, 2009
Cavalier’s
Proxy Statement on Schedule 14A, form of proxy card, and 2008 Annual Report
(including the 2008 Annual Report on Form 10-K) are available at
http://phx.corporate-ir.net/phoenix.zhtml?c=114068&p=irol-proxy.
You are
cordially invited to attend the Annual Meeting of the Stockholders of Cavalier,
and we hope you will be present at the meeting.
Whether
you plan to attend or not, please sign and return the enclosed WHITE proxy so
that we may be assured of the presence of a quorum at the Annual Meeting. A
postage-paid envelope is enclosed for your convenience in returning your proxy
to us.
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BY
ORDER OF THE BOARD OF DIRECTORS
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Michael
R. Murphy
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Secretary
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Post
Office Box 540
32 Wilson
Boulevard 100
Addison,
Alabama 35540
April
[6], 2009
CAVALIER
HOMES, INC.
POST
OFFICE BOX 540
32
WILSON BOULEVARD 100
ADDISON,
ALABAMA 35540
____________________
Proxy
Statement
For
The Annual Meeting of Stockholders
To
be held May 19, 2009
The
accompanying proxy is solicited on behalf of the Board of Directors of Cavalier
Homes, Inc., a Delaware corporation, for use at the Annual Meeting of
Stockholders and any adjournments thereof (the “
Annual Meeting
”) to
be held at the Company’s office at 32 Wilson Boulevard 100, Addison, Alabama
35540, on Tuesday, May 19, 2009, at 11:00 A.M., Central Daylight Time. This
Proxy Statement and the enclosed form of proxy are first being mailed or given
to our stockholders on or about April [6], 2009.
On
February 5, 2009, Legacy Housing, LTD. (“
Legacy
”) notified us
of its intent to nominate and, together with Curtis D. Hodgson (“
Mr. Hodgson
”),
Shipley Brothers, LTD. (“
Shipley
”) and certain
of their affiliates (collectively with Legacy, Mr. Hodgson and Shipley, the
“
Legacy
Group
”), solicit proxies for the election of three candidates to our
Board of Directors at the Annual Meeting in opposition to the eight nominees
that your Board of Directors and your Nominating and Governance Committee have
selected.
Your
Board of Directors has not approved or endorsed the nominees of the Legacy Group
and strongly urges you not to sign or return any proxy card that the Legacy
Group may send to you. Your Board of Directors unanimously recommends
that you vote FOR the Board’s eight nominees, Thomas A. Broughton, III, Barry B.
Donnell, Lee Roy Jordan, Jonathan B. Lowe, Kenneth J. Smith, Bobby Tesney, Carl
S. Thigpen and J. Don Williams, using the enclosed WHITE proxy
card.
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General
Information
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Who
is entitled to vote at the Annual Meeting?
Holders
of record of our common stock outstanding at the close of business on
March 27, 2009 are entitled to notice of, and to vote at, the Annual
Meeting. A total of _______ shares of common stock were outstanding on
such date and will be entitled to vote at the Annual Meeting. Each holder
of shares of our common stock entitled to vote has the right to one vote
for each share held of record on the record date for each matter to be
voted upon.
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What
am I voting on?
You
will be voting to elect eight Directors of Cavalier Homes, Inc. Each
Director will hold office until the next Annual Meeting of Stockholders or
until a successor is appointed and qualified. You are also voting to
ratify the action taken by the Audit Committee of the Board of Directors
in selecting Carr, Riggs & Ingram, LLC as our independent registered
public accounting firm.
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How
does the Board of Directors recommend that I vote?
The
Board of Directors unanimously recommends a vote FOR the election of
Thomas A. Broughton, III, Barry B. Donnell, Lee Roy Jordan, Jonathan B.
Lowe, Kenneth J. Smith, Bobby Tesney, Carl S. Thigpen and J. Don Williams
and FOR the ratification of the appointment of Carr, Riggs & Ingram,
LLC to serve as the Company’s independent registered public accounting
firm for the year ending December 31, 2009.
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How
do I vote?
Whether
you plan to attend the Annual Meeting or not, we urge you to vote by
proxy. Voting by proxy will not affect your right to attend the Annual
Meeting. If you are a registered stockholder, that is your shares are
registered directly in your name through our stock transfer agent, or you
have stock certificates, you may vote:
·
By mail.
Please sign,
date and mail the enclosed WHITE proxy card in the enclosed postage
prepaid envelope. Your proxy will be voted in accordance with your
instructions. If you sign the proxy card but do not specify how
you want your shares voted, they will be voted as recommended by our Board
of Directors.
·
In person at the
meeting.
If you attend the Annual Meeting, you may deliver your
completed WHITE proxy card in person or you may vote by completing a
ballot, which will be available at the Annual Meeting.
If
your shares are held in “street name” (held in the name of a bank, broker
or other nominee), you must provide the bank, broker or other nominee with
instructions on how to vote your shares. You may vote as
follows:
·
By Internet or
telephone.
Follow the instructions you receive from your broker to
vote by Internet or telephone.
·
By mail.
You will
receive instructions from your broker or other nominee explaining how to
vote your shares.
·
In person at the
meeting.
Contact the broker or other nominee who holds your shares
to obtain a legal proxy from the broker or other nominee and bring it with
you to the meeting. You will not be able to vote at the meeting unless you
have a legal proxy. You will also need to sign and submit a ballot in
order to have your vote counted.
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How
does the enclosed WHITE proxy card work?
The
enclosed WHITE proxy card permits voting for or withholding of votes as to
each of our nominees for director and votes for, against, or in abstention
with respect to the ratification of the appointment of Carr, Riggs &
Ingram, LLC. If the enclosed WHITE proxy card is properly
executed, returned, and not revoked, it will be voted in accordance with
the specifications, if any, made by the stockholder on the WHITE proxy
card and, if specifications are not made, will be voted FOR our nominees
named in this Proxy Statement and FOR ratification of the appointment of
Carr, Riggs & Ingram, LLC as the Company’s independent registered
public accounting firm.
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How
many votes must be present to hold the meeting?
The
presence, in person or by proxy, of a majority of the outstanding shares
of our common stock entitled to vote, consisting of at least _______
shares, is necessary to constitute a quorum at the Annual Meeting. Shares
of common stock represented by a properly executed proxy will be treated
as present at the Annual Meeting for purposes of determining the presence
or absence of a quorum without regard to whether the proxy is marked as
casting a vote for or against or abstaining with respect to a particular
matter. In addition, shares of common stock represented by “broker
non-votes” will be treated as present for purposes of determining a
quorum.
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How
are abstentions and broker non-votes treated for purposes of
voting?
Abstentions
will be included for purposes of determining whether the requisite number
of affirmative votes have been cast with respect to the ratification of
the selection of our independent auditors and approval of any other
matters coming before the stockholders meeting; and, accordingly, will
have the same effect as a negative vote. Broker non-votes will have no
effect on the voting with respect to any proposal.
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How
many votes are needed to elect the eight proposed directors and ratify the
proposed independent registered public accounting firm?
In
accordance with our Amended and Restated By-laws, as amended (the “
By-laws
”), the
eight nominees receiving the highest vote totals will be elected as our
directors. Accordingly, assuming the presence of a quorum, abstentions and
broker non-votes will not affect the outcome of the election of directors
at the Annual Meeting.
The
affirmative vote of the holders of a majority of the outstanding shares of
our common stock present in person or represented by proxy at the Annual
Meeting and entitled to vote thereon is required for the approval and
ratification of the selection of our independent registered public
accounting firm and for approval of all other matters.
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May
I revoke my proxy after it is sent?
If
your shares are held in your name, you may revoke a proxy by notice in
writing delivered to our Secretary, Michael R. Murphy, at any time before
it is exercised, or by attending the Annual Meeting and voting in person.
The presence of a stockholder at the Annual Meeting, however, will not
automatically revoke a proxy previously given to us.
If
your shares are held in street name, you may revoke your earlier proxy by
re-voting by mail, Internet or by telephone as instructed by your broker;
only your latest vote will be counted.
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What
does it mean if I receive more than one WHITE proxy card?
If
you receive more than one WHITE proxy card, it means that you have
multiple accounts with brokers and/or our transfer agent. Please vote all
of these shares by executing each proxy card. We recommend that you
contact your broker and/or our transfer agent to consolidate as many
accounts as possible under the same name and address. Our transfer agent
is BNY Mellon Shareowner Services, and you may reach them by telephone at
800-851-9677.
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What
should I do if I receive a proxy card from the Legacy Group?
We
strongly urge you NOT to sign or return any proxy card that the Legacy
Group or its affiliates may send you. Even if you have
previously signed and returned a proxy card sent to you by the Legacy
Group, you can revoke it by signing, dating and returning the enclosed
WHITE proxy card in accordance with the instructions in this Proxy
Statement. Only your latest dated proxy will be counted at the Annual
Meeting.
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Can
my broker vote my shares for me?
If
the Legacy Group pursues its contested solicitation and you hold your
shares in “street name,” but you do not provide voting instructions to
your broker, your broker may not be able to vote on your behalf without
your specific instructions. Due to this possibility, we strongly
encourage you to provide your broker, bank or nominee with specific voting
instructions to ensure that your shares are properly voted on your
behalf. If there is no contested election, and you do not provide
voting instructions to your broker, your broker may vote your shares in
its discretion as to routine matters. Under the rules of the NYSE
Alternext US, the uncontested election of directors and the ratification
of Carr, Riggs & Ingram, LLC as the Company’s independent registered
public accounting firm for 2009 are considered routine matters for which
brokerage firms may vote without specific instructions.
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Can
my shares be voted on matters other than those described in this Proxy
Statement?
As
of the date of this Proxy Statement, the Board of Directors knows of no
business to be presented for consideration or action at the Annual Meeting
other than the matters stated above. If any other matters properly come
before the meeting, however, it is the intention of the persons named in
the enclosed form of proxy to vote in accordance with their best judgment
on such matters.
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When
are stockholder proposals due for the 2010 Annual Meeting?
Stockholder
proposals submitted for consideration at the 2010 Annual Meeting of
Stockholders must be received by us no later than December 7, 2009, to be
considered for inclusion in the 2010 proxy materials. According to our
By-laws, for a stockholder proposal to be properly brought before the 2010
Annual Meeting of Stockholders (other than a proposal to be considered for
inclusion in the 2010 proxy materials), it must be a proper matter for
stockholder action and must be delivered to the our secretary no earlier
than January 6, 2010 and no later than February 5,
2010.
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Who
will bear the cost of the solicitation of proxies?
The
cost of soliciting proxies on behalf of the Board of Directors of the
Company, including the preparation, printing and mailing of this Proxy
Statement, will be borne by the Company. We may reimburse banks, brokers
and other nominees for their reasonable expenses incurred in obtaining
voting instructions from beneficial owners of common stock held of record
by such investment bankers, brokers and other nominees; however, we have
not entered into any written contract or arrangement for such repayment of
expenses. We estimate that our expenses related to the solicitation in
excess of those normally spent for an Annual Meeting as a result of the
proxy contest and excluding the salaries and wages of our regular
employees and officers will be approximately $______, of which
approximately $______ has been incurred to date.
In
addition, proxies may be solicited by directors, officers or other
employees of the Company in person or by telephone, facsimile or mail, or
by postings to our Web site. We will not pay these persons any additional
compensation for their efforts in soliciting proxies.
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How
else may proxies be solicited?
In
addition to the use of mails, proxies may be solicited by personal
interview, telephone or facsimile machine by the directors, our officers
and employees, without additional compensation. Appendix A sets forth
certain information relating to our directors, officers and certain
employees who are “participants” in our solicitation of proxies for the
Annual Meeting under the rules of the Securities and Exchange Commission.
We have also engaged Morrow & Co., LLC (“
Morrow
”) to
assist in the solicitation of proxies for a fee of up to $________ plus
reimbursement of reasonable out-of-pocket expenses. All other expenses of
soliciting proxies will be borne by us.
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Who
can answer my questions?
If
you have questions about your shares or status as a stockholder, or if you
have questions about this Proxy Statement or the Annual Meeting, you
should contact:
Cavalier
Homes, Inc.
Post
Office Box 540
32
Wilson Boulevard 100
Addison,
Alabama 35540
Attention:
Michael R. Murphy
Telephone:
(256) 747-9800
Fax:
(256) 747-3044
If
you have any questions regarding voting, or need assistance with voting,
please contact Morrow, our proxy solicitor:
Stockholders
call: (800) 662-5200
Brokers
or Banks call: (203) 658-9400
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What
are the directions to the Annual Meeting?
The
Annual Meeting is being held at our corporate office in Addison, Alabama.
Directions to our office from Birmingham, Alabama are:
Go
north on I-65 toward Huntsville for approximately 47 miles and take the
US-278 exit, Exit 308. Turn left onto US-278W and drive approximately 21
miles to Addison. Turn right in Addison at the first red light and take
County Road 41 north for approximately 1.5 miles and turn left onto 32
Wilson Blvd. Our corporate office is located on the immediate right in the
brick building with the green roof.
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Election
of
Directors
General
Our
By-laws provide for a Board of Directors of not less than one nor more than ten
members, the exact number to be determined by resolution of the Board of
Directors. The present Board of Directors has fixed the number of directors at
eight members and proposes the election of the eight persons listed below, each
of whom has consented to being named and to serving in such capacity as
directors until the next Annual Meeting of Stockholders and until their
successors are duly elected and shall have qualified. Proxies may not be voted
for more than eight persons. Unless otherwise directed, it is intended that
shares of common stock represented by all proxies received by the Board of
Directors will be voted in favor of the nominees listed below. Should any such
nominee become unable or decline to accept election, which is not anticipated,
it is intended that such shares of common stock will be voted for the election
of such person or persons as the Board of Directors may recommend.
YOUR
BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE NOMINEES LISTED
BELOW.
The
following table sets forth certain information concerning each nominee, each of
whom is currently serving as a director:
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Name
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Age
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Principal
Occupation
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Director
Since
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Thomas
A. Broughton, III
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53
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President
and Chief Executive Officer of ServisFirst Bank
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1986
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Barry
B. Donnell
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69
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Chairman
of the Board of Directors of Cavalier
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1986
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Lee
Roy Jordan
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67
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Retired
President of Lee Roy Jordan Redwood Lumber Company, a lumber supply
business
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1993
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Jonathan
B. Lowe
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39
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Partner,
Lowe, Mobley & Lowe, a law firm
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2009
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Kenneth
J. Smith
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40
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Retired
President and Chief Operating Officer of HM Operating, Inc., d/b/a Harden
Manufacturing Company, a furniture manufacturing company
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2009
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Bobby
Tesney
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64
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Our
President and Chief Executive Officer
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2003
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Carl
S. Thigpen
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52
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Executive
Vice President and Chief Investment Officer of Protective Life
Corporation, a diversified life insurance and financial services
company
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2009
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J.
Don Williams
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59
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Owner,
J.D. Williams & Associates, LLC, a management consulting
company
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2003
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Background
and Experience of Our Board Members
The
following is a brief description of the business experience and educational
background of each of the Board’s nominees for director.
Thomas A. Broughton, III
has
served as a member of the Board of Directors since 1986. 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
has served
as Chairman of the Board of Directors since 1986. Mr. Donnell was employed by
the Company from 1986 until December 31, 2004.
Lee Roy Jordan
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
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 J. Smith
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
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
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
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.
Required
Vote
In this
contested election of directors, the nominees receiving the greatest number of
votes shall be elected, even if such votes do not constitute a majority. This
means that the eight persons receiving the highest number of “for” votes at the
Annual Meeting will be elected.
Recommendation
of the Board of Directors
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE ELECTION OF EACH OF
THOMAS A. BROUGHTON, III, BARRY B. DONNELL, LEE ROY JORDAN, JONATHAN B. LOWE,
KENNETH J. SMITH, BOBBY TESNEY, CARL S. THIGPEN AND J. DON WILLIAMS. UNLESS
AUTHORITY TO DO SO IS WITHHELD, THE PROXY HOLDERS NAMED IN EACH WHITE PROXY CARD
WILL VOTE THE SHARES REPRESENTED THEREBY FOR THE ELECTION OF EACH OF THESE
NOMINEES.
Corporate
Governance
Code
of Ethics
We have
adopted a Code of Ethics, which applies to all our employees, including our
Chief Executive Officer, Chief Financial Officer and our Board of Directors. A
copy of our Code of Ethics is posted on our website (
www.cavhomesinc.com
).
We intend to post amendments to and waivers from our Code of Ethics (to the
extent applicable to our directors or executive officers) on our website and
will also file a Current Report on Form 8-K with the Securities and Exchange
Commission disclosing any such amendments or waivers.
Director
Attendance
During
2008, our Board of Directors held seven
meetings. Each director
attended at least seventy-five percent (75%) of the aggregate of the number of
meetings of the Board of Directors and the number of meetings of all committees
on which he served in 2008. We encourage all members of the Board of Directors
to attend the Annual Meeting of Stockholders, and in 2008, all members of the
Board of Directors were in attendance at the Annual Meeting. Jonathan B. Lowe,
Kenneth J. Smith and Carl S. Thigpen were appointed to the Board of Directors on
February 26, 2009 and thus were not included in the attendance figures for
2008.
Committees
of the Board of Directors
The Board
of Directors has four standing committees: the Executive Committee, the
Compensation Committee, the Nominating and Governance Committee and the Audit
Committee. The Executive Committee is currently composed of Bobby Tesney, Barry
B. Donnell and Thomas A. Broughton, III and is authorized to act in place of the
full Board of Directors in certain circumstances. Mr. David A. Roberson served
on the Executive Committee until his resignation in August 2008, and Mr. John W
Lowe served on this committee until his retirement from the Board of Directors
in May 2008.
Compensation
Committee
The
Compensation Committee held five meetings in 2008. During 2008, the Compensation
Committee was composed of Thomas A. Broughton, III (Chair), Lee Roy Jordan and
Barry B. Donnell. Kenneth J. Smith was appointed to the Committee on February
26, 2009. The Compensation Committee administers our stock incentive plans and
sets the compensation of our executive officers. The Compensation Committee
operates under a charter approved by the Board of Directors. The charter is
posted on our website at
www.cavhomesinc.com
.
All of
the members of the Compensation Committee are independent within the meaning of
the listing standards of the NYSE Alternext US. Each of Mr. Broughton and Mr.
Jordan were appointed to the Compensation Committee on May 20, 2008. On August
15, 2008, Mr. Donnell replaced Mr. Tesney on the Compensation Committee when Mr.
Tesney was appointed as our President and Chief Executive Officer.
Nominating
and Governance Committee
The
Nominating and Governance Committee held one meeting in 2008. During 2008, the
Nominating and Governance Committee was composed of Lee Roy Jordan (Chair), J.
Don Williams and Thomas A. Broughton, III. The Nominating and Governance
Committee is charged with developing and recommending to the Board of Directors
corporate governance principles appropriate for us, in accordance with the
guidelines and requirements established by the Securities and Exchange
Commission (“
SEC
”). The Nominating
and Governance Committee operates under a charter approved by the Board of
Directors. The charter is posted on our website at
www.cavhomesinc.com
.
The Board
of Directors appointed Messrs. Jordan, Williams and Broughton as members of the
Nominating and Governance Committee on May 20, 2008. Each of Messrs. Jordan,
Williams and Broughton, as members of the Nominating and Governance Committee,
are independent within the meaning of the listing standards of the NYSE
Alternext US.
Audit
Committee
The Audit
Committee held nine meetings during 2008. The Audit Committee is currently
composed of J. Don Williams (Chair), Thomas A. Broughton, III, Barry B. Donnell
and Carl S. Thigpen. Carl S. Thigpen did not attend the meetings of the Audit
Committee in 2008, as he was not appointed to the Board of Directors until
February 26, 2009. The Audit Committee, among other things, exercises sole
authority over the selection each year of our independent registered public
accounting firm, pre-approves all audit and non-audit services to be provided by
our independent registered public accounting firm, reviews and evaluates the
performance of our independent registered public accounting firm, reviews the
external and internal audit procedures, scope and controls practiced by our
independent registered public accounting firm and our internal accounting
personnel, and evaluates the services performed and fees charged by our
independent registered public accounting firm to determine, among other things,
that the non-audit services performed by such independent public accounting firm
do not compromise their independence. The Audit Committee also approves all
related party transactions.
The Board
of Directors appointed the members of the Audit Committee on May 20, 2008,
except for Mr. Donnell and Mr. Thigpen. Mr. Tesney served as the Chair of the
Audit Committee until his appointment as our President and Chief Executive
Officer on August 15, 2008, at which time Mr. Donnell was appointed to replace
Mr. Tesney on the Audit Committee, and Mr. Williams was appointed Chair. All of
the members of the Audit Committee are independent within the meaning of SEC
regulations and the listing standards of the NYSE Alternext US. Mr. Williams,
the chair of the Audit Committee, is qualified as an audit committee financial
expert within the meaning of SEC regulations and the Board of Directors has
determined that he has accounting and related financial management expertise
within the meaning of the listing standards of the NYSE Alternext
US.
Director
Independence
Our Board
of Directors has adopted independence standards consistent with the listing
standards adopted by the NYSE Alternext US. A Director will be considered
“independent” and found to have no material relationship with us if during the
prior three years:
|
|
·
|
The
Director has not been an employee of Cavalier or any of our
subsidiaries;
|
|
|
·
|
No
immediate family member of the Director has been an executive officer of
Cavalier;
|
|
|
·
|
Neither
the Director nor an immediate family member of the Director has received
any compensation from us other than director and committee fees,
compensation for service as an interim executive officer and pension or
other forms of direct compensation for prior service (provided such
compensation is not contingent in any way on future
service);
|
|
|
·
|
Neither
the Director nor an immediate family member of the Director has been
affiliated with or employed by a present or former internal or external
auditor for us;
|
|
|
·
|
Neither
the Director nor an immediate family member of the Director has been
employed as an executive officer of another company where any of our
present executives serve on such other company’s compensation
committee;
|
|
|
·
|
The
Director has not been a partner, controlling shareholder, executive
officer or employee, and no immediate family member of the Director has
been a partner, controlling shareholder or executive officer, of a company
that makes payments to or receives payments from us for property or
services in an amount which, in any single fiscal year, exceeded the
greater of $200,000 or 5% of such company’s consolidated gross
revenues.
|
The Board
of Directors has determined that each of the following directors are independent
of us in that such directors have no material relationship with us either
directly or indirectly as a partner, shareholder or affiliate of an organization
that has a relationship with us:
|
|
·
|
Thomas
A. Broughton, III
|
The Board
of Directors reexamines each director’s independence annually. Neither Mr.
Tesney nor Mr. Lowe is considered independent. Mr. Tesney currently serves as an
executive officer for Cavalier, and Mr. Lowe is the son of John W Lowe, a former
director and one of the original founders of the Company. Additionally, Mr.
Lowe’s law firm provided $237,000 in services to Cavalier in 2008. The Board of
Directors considered the Company’s prior transactions with Door Components, LLC,
in which Mr. Smith has an indirect interest via his 50% ownership of an entity
that holds a 25% interest in Door Components, LLC, when evaluating Mr. Smith’s
independence and determined that such transactions did not affect Mr. Smith’s
independence. The Board of Directors did not consider any other relationships or
transactions when determining the independence of the directors listed
above.
Nomination
of Directors
The
Nominating and Governance Committee considers candidates for Board of Directors
membership suggested by our members, other Board members and stockholders. A
stockholder who wishes to recommend a prospective nominee for the Board of
Directors should notify our Chairman of the Board of Directors or any member of
the Nominating and Governance Committee in writing at Post Office Box 5003, 719
Scott Avenue, Suite 414, Wichita Falls, Texas 76301 with whatever supporting
material the stockholder considers appropriate. Once the Nominating and
Governance Committee has identified a prospective nominee, the Nominating and
Governance Committee makes an initial determination as to whether to conduct a
full evaluation of the candidate. This preliminary determination is based
primarily on the need for additional Board members to fill vacancies or expand
the size of the Board of Directors and the likelihood that the prospective
nominee can satisfy certain criteria set by the Board of Directors and detailed
below. If the Nominating and Governance Committee determines, in consultation
with the Chairman of the Board of Directors and other Board members as
appropriate, that additional consideration is warranted, it may gather
background information with respect to professional, educational and community
activities, interview the candidate, determine the candidate’s willingness to
serve, and review with the candidate the time requirement involved. It may also
recommend and provide the opportunity for the prospective member to meet with
our Board members (individually or as a group) and our management (individually
or as a group). Candidates are selected for their good character, judgment and
willingness to devote adequate time to Board duties. Assessment of potential
candidates includes issues of diversity, age and skills in the context of an
assessment of the perceived needs of the Board of Directors at that time.
Directors may not serve on the boards of more than three public companies,
including our Board of Directors, and may not serve past the age of
70.
Consideration
of Dissident Nominees
On
January 21, 2009, Mr. Hodgson, a member of the Legacy Group, sent our Chairman,
Barry B. Donnell, an email indicating that Mr. Hodgson intended to nominate
three individuals for election to our Board of Directors. Mr. Donnell notified
the members of the Board of Directors about Mr. Hodgson’s letter, and the Board
of Directors convened a meeting on January 22, 2009 to discuss the letter. The
Board of Directors discussed the fact that the proxy materials for our 2008
Annual Meeting specified that for proposals to be considered for inclusion in
our 2009 proxy materials, they were to have been received no later than December
8, 2008. Mr. Barry Donnell also relayed to the Board certain prior
conversations, correspondence and meetings that Mr. Donnell and other members of
the Board of Directors and senior management had with members of the Legacy
Group during 2008 and early 2009. Mr. Donnell indicated that members of the
Legacy Group had, among other things, criticized our decision to sell CIS
Financial Services, Inc. Mr. Donnell and John W Lowe, our general counsel, also
discussed prior business interactions with members of the Legacy Group. Both Mr.
Donnell and Mr. Lowe reminded the Board that we had sold our Ft. Worth, Texas
plant to members of the Legacy Group. As a result of these prior dealings, Mr.
Donnell and Mr. Lowe had developed familiarity with the business operations of
the Legacy Group. Mr. Donnell felt that the business practices followed by
members of the Legacy Group would not be compatible either with our current
business practices or with our status as a public company. Mr. Donnell also
reminded the Board of Directors that one or more members of the Legacy Group had
contacted Mr. Donnell regarding a potential business transaction during 2008
that would have involved our possible purchase of the business operations of the
Legacy Group carried on at our former Ft. Worth facility.
During
the January 2009 Board meeting, our Board members discussed the information
provided by Mr. Donnell and Mr. Lowe and reviewed the information provided by
the Legacy Group with respect to each of the three
dissident
nominees. As a result of these discussions, our Board of Directors concluded
that the dissident nominees did not satisfy the criteria established by the
Board for director nominees, and the Board of Directors determined to neither
accept nor endorse the nominees of the Legacy Group. Following the Board
meeting, the Legacy Group notified us that it intends to solicit proxies for
three dissident nominees in opposition to the nominees the Board of Directors
and the Nominating and Governance Committee have selected.
Other
than as described above, no candidates for director nominations were submitted
to the Nominating and Governance Committee by any stockholder in connection with
the election of directors at the Annual Meeting.
Communication
with Board of Directors
Stockholders
interested in communicating directly with the Board of Directors, or specified
individual directors, may do so by writing the Chairman of the Board of
Directors at Post Office Box 5003, 719 Scott Avenue, Suite 414, Wichita Falls,
Texas 76301. The Chairman will review all such correspondence and will regularly
forward to the Board of Directors copies of all such correspondence that, in the
opinion of the Chairman, deals with the functions of the Board of Directors or
committees thereof or that he otherwise determines requires their attention.
Concerns relating to accounting, internal controls or auditing matters will
immediately be brought to the attention of the Audit Committee.
Non-Employee
Director Compensation
The
following table reflects the basis for compensation paid to each non-employee
director.
|
|
|
|
|
|
|
|
|
|
|
Committees
|
|
Title
|
|
Attendance
|
|
Board
|
|
Executive
|
|
Compensation
|
|
Nominating
and Governance
|
|
Audit
|
|
Chairman,
Board or Committees
|
|
|
Annual
retainer
|
|
|
$
|
5,000
|
|
|
$
|
—
|
|
|
$
|
4,000
|
|
|
$
|
4,000
|
|
|
$
|
12,000
|
|
|
Director
|
|
|
Annual
retainer
|
|
|
|
12,000
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Director
|
|
|
In
person
|
|
|
|
2,000
|
|
|
|
—
|
|
|
|
1,000
|
|
|
|
1,000
|
|
|
|
2,000
|
|
|
Director
|
|
|
Via
telephone
|
|
|
|
500
|
|
|
|
—
|
|
|
|
500
|
|
|
|
500
|
|
|
|
500
|
|
Directors
who attend committee meetings on the same dates as Board meetings are
compensated for attending both the Board meeting and the committee meeting.
Directors who are also our employees do not receive additional compensation for
Board service. All directors are reimbursed for travel and out-of-pocket
expenses incurred in connection with attending Board and committee
meetings.
Director
Compensation Table
The
following summary compensation table sets forth information concerning
compensation for services in all capacities, including cash and non-cash
compensation, awarded to, earned by or paid to all current non-employee members
of our Board of Directors in 2008. Information with respect to compensation paid
to Bobby Tesney prior to his being named our President and Chief Executive
Officer is included in the Summary Compensation Table on page [__].
|
Name
|
|
Fees
Earned or Paid in Cash
|
|
|
Stock
Awards
|
|
|
Option
Awards
|
|
|
Non-Equity
Incentive Plan Compensation
|
|
|
Nonqualified
Deferred Compensation Earnings
|
|
|
All
Other Compensation
|
|
|
Total
|
|
|
|
|
($)
(1)
|
|
|
($)
|
|
|
($)
(2)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
Thomas
A. Broughton, III
|
|
|
34,500
|
|
|
|
—
|
|
|
|
4,710
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
39,210
|
|
|
Barry
B. Donnell
|
|
|
28,500
|
|
|
|
—
|
|
|
|
4,710
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
33,210
|
|
|
Lee
Roy Jordan
|
|
|
26,500
|
|
|
|
—
|
|
|
|
4,710
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
31,210
|
|
|
J.
Don Williams
|
|
|
38,925
|
|
|
|
—
|
|
|
|
4,710
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
43,635
|
|
|
(1)
|
All
fees earned during the year were paid in
cash.
|
|
(2)
|
Option
awards to purchase 5,000 shares of our common stock were granted to each
director on January 2, 2008 pursuant to our 2005 Non-Employee Directors
Stock Option Plan (the “
2005 Non-Employee
Directors Plan
”). These option awards, with a fair value of $0.94
on the date of grant, vested at the rate of 1/12
th
of the shares subject to the option award on each monthly anniversary of
the date of grant. Mr. Lowe forfeited 3,333 non-vested option shares from
the 2008 grant in connection with his retirement from the Board of
Directors in May 2008. Information regarding assumptions used in
determining the grant date fair value is contained in Note 9 to Notes to
Consolidated Financial Statements included in our Form 10-K for the year
ended December 31, 2008. Options outstanding as of December 31, 2008 for
each non-employee director were:
|
|
Thomas A. Broughton, III
|
|
|
39,893
|
|
|
Barry B. Donnell
|
|
|
30,000
|
|
|
Lee Roy Jordan
|
|
|
20,000
|
|
|
J. Don Williams
|
|
|
45,000
|
|
Stockholders
approved the 2005 Non-Employee Directors Plan adopted by the Board of Directors
on April 5, 2005. Pursuant to the terms of the 2005 Non-Employee Directors Plan,
each non-employee director receives an option to purchase 5,000 shares of common
stock at fair market value upon first being elected to the Board of Directors.
Additionally, annually on January 2, each non-employee director who has served
as our director during the calendar year immediately preceding such date
receives an option to purchase 5,000 shares of common stock at fair market
value. Options granted under the 2005 Non-Employee Directors Plan generally have
a term of ten years, and become exercisable as to one-twelfth of the shares of
common stock subject to the grant on each monthly anniversary of the date of
grant, as long as the director remains our director during the vesting
period.
Audit
Committee Report
In
compliance with the requirements of the NYSE Alternext US, the Audit Committee
of Cavalier adopted a formal written charter approved by the Board of Directors
which outlines the Audit Committee’s responsibilities and how it carries out
those responsibilities. The Amended and Restated Audit Committee Charter is
available on Cavalier’s website at
www.cavhomesinc.com
under the heading “Investor Relations” and the subheading “Corporate
Governance.” In connection with the performance of its responsibilities under
its charter, the Audit Committee has:
|
|
·
|
Reviewed
and discussed the audited financial statements with
management;
|
|
|
·
|
Discussed
with the independent auditors the matters required to be discussed by
Statement on Auditing Standards No. 61 (required communication by external
auditors with audit committees);
|
|
|
·
|
Received
from the independent auditors disclosures regarding the auditors’
independence required by PCAOB Rule 3526, Communications with Audit
Committees Concerning Independence, and discussed with the auditors the
auditors’ independence; and
|
|
|
·
|
Recommended,
based on the review and discussion noted above, to the Board of Directors
that the audited financial statements be included in our Annual Report on
Form 10-K for the year ended December 31, 2008 for filing with the
Securities and Exchange Commission.
|
|
|
AUDIT
COMMITTEE
|
|
|
J.
Don Williams (Chair)
Thomas
A. Broughton, III
Barry
B. Donnell
|
Ratification
and Approval of Appointment
of
Independent Registered Public Accountants
At the
direction of the Audit Committee, our Board of Directors has unanimously
selected, subject to ratification by the Company’s stockholders, the accounting
firm of Carr, Riggs & Ingram, LLC as our independent registered public
accounting firm for fiscal year 2009. Carr, Riggs & Ingram, LLC has served
as our independent auditor since September 15, 2005. Ratification of the
selection of auditors is being submitted to our stockholders because the Board
of Directors believes it is an important corporate decision in which
stockholders should participate. If the stockholders do not ratify the selection
of Carr, Riggs & Ingram, LLC, if Carr, Riggs & Ingram, LLC shall decline
to act, resign or otherwise become incapable of acting, or if our engagement is
otherwise discontinued, the Audit Committee will select other auditors for the
period remaining until the 2010 Annual Meeting of Stockholders when engagement
of auditors is expected again to be subject to ratification by the stockholders
at such meeting.
Representatives
of Carr, Riggs & Ingram, LLC will be in attendance at the Annual Meeting and
will be provided an opportunity to address the meeting and to respond to
appropriate questions from stockholders.
Fee
Disclosure
The
following table presents fees for professional services rendered by Carr, Riggs
& Ingram, LLC for the audit of our annual financial statements for 2008 and
2007 and fees billed for audit-related services, tax services and all other
services rendered by Carr, Riggs & Ingram, LLC for 2008 and
2007.
|
|
|
2008
|
|
2007
|
|
Audit
fees
(a)
|
|
$
|
341,779
|
|
|
$
|
583,200
|
|
|
Audit-related
fees
|
|
|
—
|
|
|
|
—
|
|
|
Tax
fees
|
|
|
—
|
|
|
|
—
|
|
|
All
other fees
|
|
|
—
|
|
|
|
—
|
|
|
(a)
|
Fees
for the audit of our annual financial statements, the audit of the
effectiveness of our internal controls over financial reporting (as
required by Section 404 of Sarbanes Oxley in 2007 but not required in
2008), the audit of a stand-alone subsidiary, and quarterly reviews.
Includes amounts for expenses incurred during the
audit.
|
Upon
effectiveness of final rules promulgated by the Securities and Exchange
Commission relating to approval of non-audit services in May 2003, our Audit
Committee began pre-approving all audit-related services, tax services and other
services provided by our independent auditor. In connection with such
pre-approval, our Audit Committee concluded that the provision of such services
by Carr, Riggs & Ingram, LLC was compatible with the maintenance of that
firm’s independence in the conduct of our auditing functions.
The
Chairman of the Audit Committee, Mr. Williams, has authority to approve
engagement of our independent registered public accountants for accounting
projects of up to $20,000 per project, as long as such pre-approvals are brought
to the attention of the Audit Committee at our next committee meeting. Any
engagement of our independent registered public accountants for accounting
projects that involve fees in excess of $20,000 must have full Audit Committee
approval.
THE
BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE PROPOSAL TO
RATIFY AND APPROVE THE APPOINTMENT OF CARR, RIGGS & INGRAM, LLC AS THE
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR CAVALIER HOMES,
INC.
Executive
Officers and Principal Stockholders
Executive
Officers
The
following table sets forth certain information concerning our executive
officers, who are elected annually by the Board of Directors:
|
Name
|
|
Age
|
|
Position
|
|
Bobby
Tesney
|
|
64
|
|
President
and Chief Executive Officer
|
|
Michael
R. Murphy
|
|
63
|
|
Vice
President, CFO and Secretary-Treasurer
|
|
Barry
Mixon
|
|
61
|
|
Executive
Vice President
|
Mr. Tesney
has served as our
President and Chief Executive Officer since August 15, 2008. Mr. Tesney served
as President and Chief Executive Officer of WinsLoew Furniture, Inc. from
October 1994 until January 2002. After Mr. Tesney’s 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.
Mr. Murphy
has served as our
Chief Financial Officer and Secretary-Treasurer since 1996.
Mr. Mixon
has served as our
Executive Vice President since August 18, 2008. He previously retired from
Cavalier on December 31, 2007, following 24 years with us in various capacities,
including his position as a Division President at retirement.
Ownership
of Equity Securities
Set forth
below is information as of March 27, 2009, with respect to the beneficial
ownership of our common stock by (a) each of our directors (which directors also
constitute the nominees for election as directors at the Annual Meeting), (b)
each Named Executive Officer in the Summary Compensation Table below (see
“Executive Compensation”), and (c) all of our current directors and executive
officers as a group.
|
Name
of Individual or Persons in Group
|
|
Number of Shares Beneficially
Owned
(
1)
|
|
Percent of Class Beneficially
Owned
(1)
|
|
Thomas
A. Broughton, III
|
|
|
79,326
|
(2)
|
|
|
*
|
|
|
Barry
B. Donnell
|
|
|
941,666
|
(3)
|
|
|
5.34
|
%
|
|
Lee
Roy Jordan
|
|
|
21,166
|
(4)
|
|
|
*
|
|
|
Jonathan
B. Lowe
|
|
|
62,250
|
(5)
|
|
|
*
|
|
|
Barry
Mixon
|
|
|
32,500
|
|
|
|
*
|
|
|
Michael
R. Murphy
|
|
|
125,234
|
(6)
|
|
|
*
|
|
|
David
A. Roberson
|
|
|
324,677
|
(7)
|
|
|
1.83
|
%
|
|
Kenneth
J. Smith
|
|
|
3,250
|
(8)
|
|
|
*
|
|
|
Bobby
Tesney
|
|
|
35,200
|
(9)
|
|
|
*
|
|
|
Carl
S. Thigpen
|
|
|
1,250
|
(10)
|
|
|
*
|
|
|
J.
Don Williams
|
|
|
51,666
|
(11)
|
|
|
*
|
|
|
All
current directors and executive officers (10 persons)
|
|
|
1,353,508
|
(12)
|
|
|
7.60
|
%
|
The
following persons have reported ownership in Cavalier at a level greater than
5%, according to statements on Schedule 13D or 13G as filed by such persons with
the Securities and Exchange Commission:
|
Name
and Address of Beneficial Owner
|
|
Number of Shares Beneficially
Owned
(1)
|
|
Percent of Class Beneficially
Owned
(1)
|
|
Dimensional
Fund Advisors LP
Palisades
West, Building One, 6300 Bee Cave Rd,
Austin, TX 78746
|
|
|
1,464,630
|
(13)
|
|
|
8.32
|
%
|
|
Name
and Address of Beneficial Owner
|
|
Number of Shares Beneficially
Owned
(1)
|
|
Percent of Class Beneficially
Owned
(1)
|
|
GAMCO
Investors, Inc.
One
Corporate Center, Rye, NY 10580-1435
|
|
|
3,270,699
|
(14)
|
|
|
18.59
|
%
|
|
Legacy
Housing, LTD.
15400
Knoll Trail, Suite 101, Box 25, Dallas, TX 75248
|
|
|
1,690,692
|
(15)
|
|
|
9.61
|
%
|
|
T.
Rowe Price Associates, Inc./T. Rowe Price Small-Cap Value Fund,
Inc.
100
E. Pratt Street, Baltimore, MD 21202
|
|
|
1,602,900
|
(16)
|
|
|
9.11
|
%
|
* Represents
beneficial ownership of less than 1% of the outstanding shares of our common
stock.
(1)
Beneficial
ownership in the foregoing table is based upon information furnished by the
persons listed. For purposes of this table, a person or group of persons is
deemed to have “beneficial ownership” of any shares as of March 27, 2009, that
such person or group has the right to acquire within 60 days after such date, or
with respect to which such person otherwise has or shares voting or investment
power. For purposes of computing beneficial ownership and the percentages of
outstanding shares held by each person or group of persons on a given date,
shares which such person or group has the right to acquire within 60 days after
such date are shares for which such person has beneficial ownership and are
deemed to be outstanding for purposes of computing the percentage for such
person, but are not deemed to be outstanding for the purpose of computing the
percentage of any other person. Except as otherwise indicated in these notes to
the foregoing table, the beneficial owners named in the table have sole voting
and investment power with respect to the shares of common stock reflected and
the address of each of the persons is as follows: c/o Cavalier Homes, Inc., 32
Wilson Blvd 100, Addison, AL 35540.
(2)
Includes
16,477 shares beneficially owned in an Individual Retirement Account.
Includes 36,559 shares issuable pursuant to stock options presently exercisable
as of March 27, 2009, or within 60 days thereafter.
(3)
Includes
21,666 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter, 100,000 shares held by the Donnell
Foundation, of which Mr. Donnell is co-trustees and 100,000 shares beneficially
owned in an Individual Retirement Account. Mr. Donnell has voting and investment
power with respect to the shares held by the Donnell Foundation. Also includes
13,000 shares held in his wife's Individual Retirement Account and 7,000 shares
owned directly by his wife. Also includes 100,000 shares held by the Sam Donnell
Family Limited Partnership, 1% of which is held by a limited liability company
in which Mr. Donnell holds 51% of the limited liability company interests. Mr.
Donnell disclaims beneficial ownership of the shares held directly by his wife
and the shares held in his wife's Individual Retirement Account. The address for
Mr. Donnell is 719 Scott Avenue, Suite 414 Wichita Falls, TX 76301.
(4)
Includes
16,666 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter.
(5)
Includes
1,250 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter.
(6)
Includes
60,000 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter, 4,700 shares held in Mr. Murphy’s
Individual Retirement Account and 3,700 shares held in his wife’s Individual
Retirement Account. Includes 6,666 shares of restricted stock which has not yet
fully vested, but over which Mr. Murphy may exercise voting rights. Mr. Murphy
disclaims beneficial ownership of the shares held in his wife’s Individual
Retirement Account.
(7)
Includes
6,510 shares beneficially owned in an Individual Retirement Account and 1,874
shares held in his wife’s Individual Retirement Account. Includes 18,272 shares
held by a family limited partnership of which Mr. Roberson is the general
partner. Includes 115,000 shares issuable pursuant to stock options presently
exercisable as of March 27, 2009, or within 60 days thereafter. Mr. Roberson
disclaims beneficial ownership of the shares held in his wife’s Individual
Retirement Account.
(8)
Includes
1,250 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter, and 2,000 shares held by a limited
liability company of which Mr. Smith is a 50% owner.
(9)
Includes
20,000 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter.
(10)
Includes
1,250 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter.
(11)
Includes
46,666 shares issuable pursuant to stock options presently exercisable as of
March 27, 2009, or within 60 days thereafter.
(12)
See
notes 1-6 and 8-11 above.
(13)
In
a Schedule 13G filed on February 9, 2009, Dimensional Fund Advisors LP (“
Dimensional
”), an
investment advisor registered under Section 203 of the Investment Advisors Act
of 1940, reported having sole voting and dispositive power of 1,464,630 shares.
Dimensional furnishes investment advice to four investment companies registered
under the Investment Company Act of 1940, and serves as investment manager to
certain other commingled group trusts and separate accounts. These investment
companies, trusts and accounts are the “
Funds
.” In its role
as investment adviser or manager, Dimensional possesses voting and/or investment
power over the securities of the issuers described in the schedule that are
owned by the Funds. Dimensional disclaims beneficial ownership of such
securities. All information in this footnote was obtained from the Schedule 13G
filed by Dimensional.
(14)
In
a Schedule 13D filed March 9, 2009, Mario J. Gabelli, and various entities which
he directly or indirectly controls or for which he acts as chief investment
officer (“Gabelli”), reported having shared power to vote or dispose of
3,270,699 shares of common stock. Included in the Schedule 13D is GGCP, Inc.,
MJG Associates, Inc., Gabelli Foundation, Inc., Mario Gabelli, LICT Corporation,
GAMCO Investors, Inc. (“GBL”), a public company listed on the New York Stock
Exchange, and the following entities of which GBL is the parent company: GAMCO
Asset Management, Inc., Gabelli Funds, LLC, Gabelli Securities, Inc., Gabelli
& Company, Inc. and Teton Advisors, Inc. All information in this footnote
was obtained from the Schedule 13D filed by Gabelli.
(15)
In
a Schedule 13D/A filed February 6, 2009, Legacy Housing, LTD and certain
affiliated persons jointly reported having shared power to vote or dispose of
1,690,692 shares of common stock. Included in the Schedule 13D/A are: (a) Legacy
Housing, LTD., a Texas limited partnership (“
Legacy
”), (b) GPLH,
LC, a Texas limited liability company which serves as the general partner of
Legacy (“
GPLH
”), (c) Shipley
Brothers, LTD, a Texas limited partnership which serves as a manager of GPLH
(“
Shipley
LTD
”), (d) K-Shipley, LLC, a Texas limited liability company which serves
as a general partner of Shipley LTD (“
K-Shipley
”), (e)
D-Shipley, LLC, a Texas limited liability company which serves as a general
partner of Shipley LTD (“
D-Shipley
”), (f)
B-Shipley, LLC, a Texas limited liability company which serves as a general
partner of Shipley LTD (“
B-Shipley
”), (g)
Federal Investors Servicing, LTD., a Texas limited partnership (“
Federal Servicing
”),
(h) Federal Investors Management, L.C., a Texas limited liability company which
serves as the general partner of Federal Servicing (“
Federal Management
”),
(i) Kenneth E. Shipley, the president and assistant secretary of GPLH, the
president and sole member of K-Shipley and the president and manager of Federal
Management and a citizen of the United States, (j) Curtis D. Hodgson, the
vice president, secretary and manager of GPLH and a citizen of the United
States, (k) Douglas M. Shipley, the president and sole member of D-Shipley
and the secretary of Federal Management and a citizen of the United States, (l)
Billy J. Shipley, the president and sole member of B-Shipley and the vice
president of Federal Management and a citizen of the United States, and (m)
Michael R. O’Connor, a citizen of the United States. All information in this
footnote was obtained or derived from the Schedule 13D/A filed by
Legacy.
(16)
In
a Schedule 13G filed February 12, 2009, T. Rowe Price Associates, Inc. (“
T. Rowe Price
”) and
T. Rowe Price Small-Cap Value Fund, Inc. (“
Small-Cap Fund
”)
jointly reported having sole power to vote or dispose of 1,602,900 shares of
common stock. These securities are owned by various individual and institutional
investors, including the Small-Cap Fund, which T. Rowe Price serves as an
investment advisor with power to direct investments and/or sole power to vote
the securities. For purposes of the reporting requirements of the Securities
Exchange Act of 1934, T. Rowe Price is deemed to be a beneficial owner of such
securities; however, T. Rowe Price expressly disclaims that it is, in fact, the
beneficial owner of such securities. All information in this footnote was
obtained from the Schedule 13G and cover letter we received from T. Rowe Price
and Small-Cap Fund.
Executive
Compensation
The
following tables, graphs and other information provide details concerning
executive compensation.
Summary
Compensation Table
The
following summary compensation table sets forth information concerning
compensation for services in all capacities, including cash and non-cash
compensation, awarded to, earned by or paid to (i) our current Chief Executive
Officer, (ii) our former Chief Executive Officer, and (iii) our two other
executive officers who were serving as such as of December 31, 2008,
(collectively, the “Named Executive Officers”), as well as the total
compensation paid to each Named Executive Officer for the previous year, if
applicable.
|
Name
and Principal Position
|
|
Year
|
|
Salary
|
|
Bonus
|
|
Stock Awards
(1)
|
|
Option Awards
(2)
|
|
Non-Equity
Incentive Plan Compensation
|
|
Nonqualified
Deferred Compensation Earnings
|
|
All
Other
Compensation
|
|
Total
|
|
|
|
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
Bobby
Tesney
|
|
2008
|
|
93,462
|
|
80,000
|
|
—
|
|
4,710
|
|
—
|
|
—
|
|
28,337
|
(5)
|
206,509
|
|
President
and Chief
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive
Officer
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
David
A. Roberson
|
|
2008
|
|
181,538
|
|
—
|
|
79,248
|
|
—
|
|
—
|
|
—
|
|
542,180
|
(5)
|
802,966
|
|
former
President and
|
|
2007
|
|
350,000
|
|
—
|
|
66,040
|
|
—
|
|
—
|
|
—
|
|
44,276
|
(6)
|
460,316
|
|
CEO
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael
R. Murphy
|
|
2008
|
|
210,192
|
|
119,245
|
|
44,147
|
|
—
|
|
—
|
|
—
|
|
4,880
|
(5)
|
378,464
|
|
VP,
CFO and
|
|
2007
|
|
225,000
|
|
—
|
|
44,026
|
|
—
|
|
—
|
|
—
|
|
5,065
|
(6)
|
274,091
|
|
Secretary-Treasurer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barry
Mixon
|
|
2008
|
|
79,615
|
|
60,000
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
139,615
|
|
Executive
Vice
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
President
(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Stock
awards were granted in March 2006 pursuant to our 2005 Incentive
Compensation Plan. Information regarding assumptions used in determining
the grant date fair value is contained in Note 9 to Notes to Consolidated
Financial Statements included in our Form 10-K for the year ended December
31, 2008. The amounts reflected above represent the portion of the grant
date fair value amortized to expense in 2008 and
2007.
|
|
(2)
|
Option
awards were granted to Mr. Tesney in his capacity as a non-employee Board
member in January 2008 pursuant to our 2005 Non-employee Directors Stock
Option Plan. Information regarding assumptions used in determining the
grant date fair value is contained in Note 9 to Notes to Consolidated
Financial Statements included in our Form 10-K for the year ended December
31, 2008. The amounts reflected above represent the portion of the grant
date fair value amortized to expense in
2008.
|
|
(3)
|
Mr.
Tesney was appointed President and Chief Executive Officer by our Board of
Directors on August 15, 2008. Prior to this date, Mr. Tesney was one of
our non-employee directors.
|
|
(4)
|
Mr.
Roberson resigned as our President and Chief Executive Officer on August
15, 2008.
|
|
(5)
|
Includes
the following: (i) for Mr. Tesney, fees earned and paid in cash in the
amount of $25,575 in his capacity as a non-employee director and $2,762
for personal use of a company vehicle, (ii) for Mr. Roberson, severance of
$475,000 to be paid in 26 bi-weekly payments beginning August 29, 2008, of
which $164,423 was paid as of December 31, 2008, payment for attorney’s
fees totaling $22,717, a total of $4,354 for health insurance coverage for
the period through August 2009, premiums on life insurance policies
totaling $20,940, taxes on life insurance totaling $9,060, $6,344 for
personal use of a company vehicle, and matching contributions made by us
to our 401(k) plan during 2008 on behalf of Mr. Roberson in the amount of
$3,765, and (iii) for Mr. Murphy, matching contributions made by us to our
401(k) plan during 2008 on behalf of Mr. Murphy in the amount of $3,670
and $1,211 for car allowances.
|
|
(6)
|
Includes
the following: (i) matching contributions made by us to our 401(k) plan
during 2007 on behalf of Mr. Roberson in the amount of $5,189 and on
behalf of Mr. Murphy in the amount of $5,065, and (ii) $18,385 paid to Mr.
Roberson for premiums on life insurance policies, $11,244 for taxes on
life insurance premiums, and $9,458 for personal use of a company
vehicle.
|
|
(7)
|
Mr.
Mixon was appointed Executive Vice President by our Board of Directors on
August 18, 2008.
|
Outstanding
Equity Awards at Fiscal Year-end
|
|
|
Option
Awards
|
|
Stock
Awards
|
|
Name
|
|
Number
of Securities Underlying Unexercised Options Exercisable
|
|
Number
of Securities Underlying Unexercised Options Unexercisable
|
|
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised
Unearned Options
|
|
Options
Exercise Price
|
|
Option
Expiration Date
|
|
Number
of Shares or Units of Stock That Have Not Vested
|
|
Market
Value of Shares or Units of Stock That Have Not Vested
|
|
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights
That Have Not Vested
|
|
Equity
Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or
Other Rights That Have Not Vested
|
|
|
|
(#)
|
|
(#)
|
|
(#)
|
|
($)
|
|
|
|
(#)
|
|
($)
|
|
(#)
|
|
($)
|
|
Bobby
Tesney
|
|
5,000
|
|
|
|
|
|
1.93
|
|
01/02/18
|
|
|
|
|
|
|
|
|
|
|
|
5,000
|
|
|
|
|
|
4.16
|
|
01/02/17
|
|
|
|
|
|
|
|
|
|
|
|
5,000
|
|
|
|
|
|
6.45
|
|
01/02/16
|
|
|
|
|
|
|
|
|
|
|
|
5,000
|
|
|
|
|
|
5.51
|
|
01/03/15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
David
A. Roberson
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100,000
|
|
|
|
|
|
3.40
|
|
01/29/12
|
|
|
|
|
|
|
|
|
|
|
|
15,000
|
|
|
|
|
|
3.94
|
|
01/26/10
|
|
|
|
|
|
|
|
|
|
|
|
10,000
|
|
|
|
|
|
9.66
|
|
01/25/09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael
R. Murphy
|
|
|
|
|
|
|
|
|
|
|
|
6,666
(1)
|
|
7,133
|
|
|
|
|
|
|
|
50,000
|
|
|
|
|
|
3.40
|
|
01/29/12
|
|
|
|
|
|
|
|
|
|
|
|
10,000
|
|
|
|
|
|
3.94
|
|
01/26/10
|
|
|
|
|
|
|
|
|
|
|
|
7,500
|
|
|
|
|
|
9.66
|
|
01/25/09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barry
Mixon
|
|
none
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The
unvested stock award vested on
03/13/09.
|
Pension
Benefits in Fiscal 2008
We do not
provide pension benefits.
Nonqualified
Deferred Compensation in Fiscal 2008
We do not
have nonqualified deferred compensation plans.
Potential
Payments on Termination
The Named
Executive Officers, with the exception of David A. Roberson, do not have
employment, severance or change in control agreements with us. The information
below describes and quantifies certain compensation that would become payable
under existing plans and arrangements if the Named Executive’s employment
terminated on December 31, 2008. These benefits are in addition to benefits
available generally to salaried employees, such as distributions under our
401(k) plan and accrued vacation pay. Mr. Roberson’s existing Severance
Agreement and Release is discussed below.
Equity
Awards
.
Under
the Stock Grant Agreements we have entered into with our Named Executive
Officers, termination for any reason other than death, disability or a change in
control results in the forfeiture of any outstanding restricted stock grants
which are unvested on the date of termination. If one of our Named Executive
Officers were to die or become disabled, any unvested restricted stock grants
would become vested in full as of the date of the death or disability. For these
purposes, our 2005 Incentive Compensation Plan defines “disability” as
a
condition (a) which prevents a Named Executive Officer
from engaging in any
gainful activity and
which is expected to result in death or to last for a continuous period of at
least 12 months or (b) resulted in the Named Executive Officer receiving income
replacement benefits for a period of not less than three months under any
a
c
cident or health plan covering our employees. Unvested
restricted stock grants would also vest immediately upon a change in
control.
Our 2005 Incentive Compensation Plan defines
“
change in control”
as the occurrence of any of the following: (a) a
person, o
ther than the Company, a
subsidiary or an employee benefit plan, becoming the beneficial owner of twenty
percent (20%) or more of our outstanding voting securities; (b) any transaction
or event which would trigger disclosure under Item 6(e) of Schedule
14
A
promulgated under the Exchange Act; (c) during any two consecutive year period,
current Board members cease to constitute a majority of our Board of Directors
(unless the election of new Board members was approved by at least two-thirds of
our current Bo
a
rd members); or (d) any transaction requiring the
approval of our stockholders for the acquisition of the Company, whether by a
purchase of assets, merger or otherwise.
The
following table provides the intrinsic value (that is, the value based on the
price of our common stock as of December 31, 2008) of equity awards that would
vest if a Named Executive Officer had died, became disabled or we experienced a
change in control as of December 31, 2008.
|
Name
of Executive
|
|
Intrinsic
Value of Equity Awards If Vested
|
|
Bobby
Tesney
|
|
$
|
—
|
|
|
Michael
R. Murphy
|
|
|
7,133
|
|
|
Barry
Mixon
|
|
|
—
|
|
Severance
Agreement with David A. Roberson
. On August 15, 2008, Cavalier entered
into a Severance Agreement and Release with Mr. Roberson, under which he will be
entitled to receive (1) $475,000.00, payable over 12 months in 26 consecutive
pay periods, (2) continued health insurance coverage, including coverage under
any ancillary benefit plans, such as dental insurance, that Mr. Roberson
currently has deducted from his salary, (3) accelerated vesting of his remaining
outstanding restricted stock awards and extension of the exercise period of his
outstanding stock options, and (4) directors’ and officers’ liability insurance
coverage. Pursuant to the Severance Agreement and Release, Mr. Roberson has
agreed, among other things, to be bound by a one-year covenant not to compete, a
one-year covenant not to solicit our employees and a covenant regarding
protection of our confidential information. Both Mr. Roberson and Cavalier have
entered into non-disparagement covenants.
Certain
Relationships and Related Transactions
We
purchased raw materials of approximately $11,564,000, $14,474,000 and
$14,698,000 from MSR Forest Products, LLC (“
MSR
”) during 2008,
2007, and 2006, respectively. Cavalier owns a minority interest in this company.
Jonathan B. Lowe (a member of our Board of Directors) and Michael P. Lowe, sons
of John W Lowe (a former member of our Board of Directors and one of the
original founders of the Company), have a minority ownership interest in MSR,
and Richard Roberson (our former President and Chief Executive Officer’s
brother), also has a minority ownership interest in and is an executive officer
of MSR. We believe that the payments made for the products purchased from MSR
were reasonable compared to amounts that would have been paid to unaffiliated
entities for similar products.
We
purchased components of approximately $156,117, $375,077 and $995,475 from Door
Components, LLC (“
Door
Components
”) during 2008, 2007 and 2006, respectively. Kenneth J. Smith,
a member of our Board of Directors, has an indirect interest via his 50%
ownership of an entity that holds a 25% interest in Door Components. We believe
that the payments made for the products purchased from Door Components were
reasonable compared to amounts that would have been paid to unaffiliated
entities for similar products. Following the appointment of Mr. Smith to the
Board of Directors on February 26, 2009, we determined to cease future purchases
from and sales to Door Components.
We used
the services of a law firm, Lowe, Mobley & Lowe, a partner of which, Mr.
John W Lowe, served as one of our directors until May 2008 and continues to
serve as our general counsel. Mr. Jonathan B. Lowe, another partner in the law
firm, currently serves as one of our directors. We paid legal fees to this firm
for Messrs. Lowe’s services as general counsel and the firm’s defense of
litigation against us in the sums of $237,000 (2008), $212,000 (2007), and
$292,000 (2006).
Related Party
Transaction Policy
: Our Board of Directors recognizes that a Related
Party Transaction presents a potential risk of conflict of interest and,
therefore, has adopted a policy that is followed in connection with all Related
Party Transactions involving us. As a general matter, it is the preference of
the Board of Directors to avoid Related Party Transactions. However, the Board
of Directors recognizes that there may be situations where a Related Party
Transaction may be consistent with our best interests and the best interests of
our shareholders.
Our Audit
Committee charter requires that all Related Party Transactions must be submitted
to the Audit Committee for review and approval or disapproval (or ratification).
In determining whether to approve or disapprove a Related Party Transaction, the
Audit Committee will take into account, among other factors it deems
appropriate, whether the Related Party Transaction is on terms no less favorable
than terms generally available to an unaffiliated third-party under the similar
circumstances. The Audit Committee will also take into account the extent of the
Related Party’s interest in the transaction and whether the transaction is in
our best interests and our shareholders. The Chairperson of the Audit Committee
may approve or ratify a Related Party Transaction in between Committee meetings.
While our Audit Committee charter is in writing, our policy governing review and
approval of Related Party Transactions is simply an element of our routine Audit
Committee function and is not a formally written policy. Given the size of our
Company and the relatively small number of Related Party Transactions that our
Audit Committee reviews, our Board of Directors did not draft an additional set
of guidelines to be used by the Audit Committee in reviewing Related Party
Transactions. Our quarterly disclosure committee review process also includes a
review of any Related Party Transactions.
For this
section, a “Related Party” is: (1) any of our executive officers or directors,
(2) any nominee for election as a director, (3) any greater than 5 percent
beneficial owner of our common stock, (4) any immediate family member of any of
the foregoing, or (5) any entity which is owned or controlled by any of the
persons listed in (1), (2), (3) or (4) above.
A
“Related Party Transaction” is any transaction, arrangement or relationship (or
series of transactions, arrangements or relationships) in which Cavalier
(including subsidiaries) was, is or will be a participant, and in which any
Related Party had, has or will have a direct or indirect
interest.
The
Company had no new Related Party Transactions in 2008. As noted above, we had
transactions in 2008 with Related Parties for relationships that began in prior
years. Due to the significance of the purchases from MSR, our Audit Committee
reviews and approves the overall pricing of products we purchase from MSR on an
annual basis. The Audit Committee does not review the other on-going Related
Party relationships noted above on an annual basis unless the nature, or
significance, of the relationship changes.
Section
16(a) Beneficial Ownership Reporting compliance
Our
executive officers, directors and beneficial owners of more than 10% of our
common stock are required under the Exchange Act to file reports of ownership
and changes in ownership with the Securities and Exchange Commission and the
NYSE Alternext US. Copies of these reports must also be furnished to us. We
believe that during 2008 all applicable filing requirements were complied with
in a timely manner except for a Form 4 filed one day late on December 15, 2008
for Mr. Tesney due to an oversight.
Other
Matters
The Board
of Directors does not know of any other business to be presented for
consideration at the Annual Meeting. If other matters properly come before the
Annual Meeting, the persons named in the accompanying form of proxy will vote
thereon in their best judgment.
|
|
CAVALIER
HOMES, INC.
|
|
|
|
|
|
Michael
R. Murphy
|
|
|
Secretary
|
Addison,
Alabama
April
[6], 2009
Appendix
A
Information
Concerning Persons who are Participants
in
the Company’s Solicitation of Proxies
Information
Regarding Participants
The
Company, its directors and certain of its officers and employees may be deemed
to be participants in a solicitation of proxies in connection with the Annual
Meeting. Each of the directors of the Company and each of the officers and
employees of the Company who are or may be deemed to be participants in the
solicitation is listed below, together with the number of equity securities of
the Company beneficially owned by each of these persons as of March 27, 2009,
including the number of shares for which beneficial ownership can be acquired
within 60 days of March 27, 2009. None of the persons listed below owned any
equity securities of the Company of record that such person does not own
beneficially. The business address of each participant is Cavalier Homes, Inc.,
32 Wilson Boulevard 100, Addison, Alabama 35540.
|
Name
|
|
Occupation
Information
|
|
Shares
of Common Stock Owned
|
|
Thomas
A. Broughton, III
|
|
Director
|
|
42,767
|
|
|
Barry
B. Donnell
|
|
Chairman
of the Board of Directors
|
|
920,000
|
(1)
|
|
Lee
Roy Jordan
|
|
Director
|
|
4,500
|
|
|
Jonathan
B. Lowe
|
|
Director
|
|
61,000
|
(2)
|
|
Michael
R. Murphy
|
|
Vice
President, CFO and Secretary-Treasurer
|
|
65,234
|
(3)
|
|
Kenneth
J. Smith
|
|
Director
|
|
—
|
|
|
Bobby
Tesney
|
|
Director,
President and Chief Executive Officer
|
|
15,200
|
(4)
|
|
Carl
S. Thigpen
|
|
Director
|
|
—
|
|
|
J.
Don Williams
|
|
Director
|
|
5,000
|
|
|
(1)
|
Mr.
Donnell directly owns 700,000 shares, the Donnell Foundation of which he
is a co-trustee owns 100,000 shares, a partnership in which Mr. Donnell is
a partner owns 100,000 shares, and Mr. Donnell’s spouse owns 20,000
shares.
|
|
(2)
|
Mr.
Jonathan B. Lowe directly owns 11,000 shares, and the Jonathan B. Lowe
2008 GST Trust, of which Mr. Lowe serves as trustee, owns 50,000
shares.
|
|
(3)
|
Mr.
Murphy directly owns 61,534 shares, and his spouse owns 3,700
shares.
|
|
(4)
|
Mr.
Tesney directly owns 5,200 shares, and his spouse owns 10,000
shares.
|
Information
Regarding Transactions in our Securities by Participants
The
following table sets forth information regarding purchases and sales during the
past two years of shares of our common stock by persons who, under the rules of
the Securities and Exchange Commission, are or may be deemed “participants” in
our solicitation of proxies in connection with the Annual
Meeting. Except as set forth below or as otherwise disclosed in this
Proxy Statement, none of the purchase price or market value of those shares is
represented by funds borrowed or otherwise obtained for the purpose of acquiring
or holding such securities. To the extent that any part of the
purchase price or market value of any of those shares is represented by funds
borrowed or otherwise obtained for the purpose of acquiring or holding such
securities, the amount of the indebtedness as of the latest practicable date is
set forth below. If those funds were borrowed or obtained otherwise
than pursuant to a margin account or bank loan in the regular course of business
of a bank, broker or dealer, a description of the transaction and the parties is
set forth below.
|
Name
|
|
Date
|
|
Number
of Shares
|
|
Transaction
Footnote
|
|
Thomas
A. Broughton, III
|
|
|
|
—
|
|
|
|
Barry
B. Donnell
|
|
12/09/2008
|
|
4,200
|
|
(1)
|
|
|
|
12/08/2008
|
|
15,475
|
|
(1)
|
|
|
|
12/08/2008
|
|
10,900
|
|
(1)
|
|
Name
|
|
Date
|
|
Number
of Shares
|
|
Transaction
Footnote
|
|
Lee
Roy Jordan
|
|
|
|
—
|
|
|
|
Jonathan
B. Lowe
|
|
01/29/2009
|
|
5,000
|
|
(1)
|
|
|
|
01/28/2009
|
|
6,000
|
|
(1)
|
|
|
|
09/30/2008
|
|
50,000
|
|
(2)
|
|
Michael
R. Murphy
|
|
03/13/2009
|
|
6,666
|
|
(3)
|
|
|
|
03/13/2008
|
|
6,667
|
|
(3)
|
|
|
|
03/13/2007
|
|
6,667
|
|
(3)
|
|
Kenneth
J. Smith
|
|
|
|
—
|
|
|
|
Bobby
Tesney
|
|
12/10/2008
|
|
10,000
|
|
(4)
|
|
Carl
S. Thigpen
|
|
|
|
—
|
|
|
|
J.
Don Williams
|
|
|
|
—
|
|
|
|
(1)
|
Open
market purchase of common stock
|
|
(3)
|
Restricted
Stock Award
|
|
(4)
|
Open
market purchase of common stock by
spouse
|
Miscellaneous
Information Regarding Participants
Except as
described in this Appendix A or the attached Proxy Statement, to the best of our
knowledge (i) none of the participants identified above is or was within the
past year a party to any contract, arrangement or understanding with any person
with respect to any securities of the Company, including, but not limited to,
joint ventures, loan or option arrangements, puts or calls, guarantees against
loss or guarantees of profit, division of losses or profits, or the giving or
withholding of proxies, and (ii) no “associate” of any of the participants
identified beneficially owns, directly or indirectly, any shares or other
securities of the Company.
Except as
described in this Appendix A or the attached Proxy Statement, to the best of our
knowledge, none of the participants identified above nor any of their associates
(i) has had or will have a direct or indirect material interest in any
transaction or series of similar transactions since the beginning of the
Company’s last fiscal year or any currently proposed transactions, or series of
similar transactions, to which the Company or any of its subsidiaries was or is
to be a party in which the amount involved exceeds $120,000, or (ii) has any
arrangements or understandings with any person with respect to any future
employment by the Company or its affiliates or with respect to any future
transactions to which the Company or any of its affiliates will or may be a
party.
Except as
described in this Appendix A or the attached Proxy Statement, none of the
participants identified above has any substantial interests, direct or indirect,
by security holding or otherwise, in any matter to be acted upon at the Annual
Meeting.
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 19,
2009, beginning at 11:00 A.M., Central Daylight Time, at the Company’s office at
32 Wilson Boulevard 100, Addison, Alabama 35540 and at any adjournment or
postponement thereof, in the following manner:
|
1.
|
ELECTION
OF DIRECTORS
|
|
|
¨
|
FOR
all nominees listed below
(except
as otherwise instructed below)
|
¨
|
AUTHORITY
WITHHELD
to
vote for all nominees listed below
|
|
|
Thomas A. Broughton, III, Barry B. Donnell, Lee Roy Jordan, Jonathan B.
Lowe,
Kenneth J. Smith, Bobby Tesney, Carl S. Thigpen and J. Don
Williams
|
|
|
To
withhold authority to vote for any nominee, write that nominee's name in
the space provided below.
|
|
2.
|
PROPOSAL
TO RATIFY AND APPROVE THE APPOINTMENT OF CARR, RIGGS & INGRAM, LLC AS
THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR CAVALIER HOMES,
INC.
|
|
|
¨
FOR
|
¨
AGAINST
|
¨
ABSTAIN
|
|
3.
|
TO
TRANSACT ANY OTHER BUSINESS THAT MAY PROPERLY COME BEFORE THE ANNUAL
MEETING OR ANY ADJOURNMENT OR POSTPONEMENTS THEREOF.
|
(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 PREVIOUS PAGE, 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
.
|
|
Dated:
________________________________, 2009
|
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Signature
|
|
|
|
|
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Signature
(if held jointly)
|
|
|
|
|
|
Title
|
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.
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