As filed with the Securities and Exchange Commission on December 19, 1996
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
-------------------------
CAVALIER HOMES, INC.
(Exact name of registrant as specified in its charter)
Delaware 63-0949734
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
-------------------------
Highway 41 North and Cavalier Road
Addison, Alabama 35540
(205) 747-1575
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
-------------------------
Barry B. Donnell
719 Scott Avenue, Suite 600
Wichita Falls, Texas 76307
(817) 723-5523
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-------------------------
Copies to:
Richard B. Goodner, Esq.
LOOPER, REED, MARK & McGRAW
Incorporated
1601 Elm Street, Suite 4100
Dallas, Texas 75201
(214) 954-4135
--------------------------
Approximate date of commencement of proposed sale to the public is as
soon as possible after the effective date of the Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. :|x|
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. |_|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|
If this form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. |_|
CALCULATION OF REGISTRATION FEE
- - --------------------------------------------------------------------------------
Title of each class of Amount to Proposed maximum
securities to be registered be registered offering price per
share(1)
- - --------------------------------------------------------------------------------
Common Stock, par value
$.10 per share... 200,000 shares $11.57
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
Title of each class of Proposed maximum Amount of
securities to be registered aggregate offering registration fee
price(1)
- - --------------------------------------------------------------------------------
Common Stock, par value
$.10 per share... $2,314,000 $701.21
- - --------------------------------------------------------------------------------
(1) Estimated solely for purposes of determining the registration fee pursuant
to Rule 457(c) under the Securities Act. The registration fee has been
calculated on the basis of the average of the high and low prices reported
on December 17, 1996 on the New York Stock Exchange, which price was $11.57
per share.
<PAGE>
PROSPECTUS
CAVALIER HOMES, INC.
Dividend Reinvestment and Stock Purchase Plan
200,000 Shares of Common Stock
This Prospectus relates to 200,000 shares of common stock, par value
$0.10 per share (the "Common Stock"), of Cavalier Homes, Inc., a Delaware
corporation (the "Company"), to be issued pursuant to the Company's Dividend
Reinvestment and Stock Purchase Plan (the "Plan"). The Plan provides holders of
Common Stock with an opportunity to invest cash distributions on shares of
Common Stock and optional cash payments for additional shares of Common Stock
without payment of any brokerage commission or service charge. Shares of Common
Stock for the Plan will be purchased directly from the Company. No open market
purchases of shares of Common Stock are permitted for the Plan. The Plan is
administered by Mellon Securities Trust Company (the "Plan Agent").
Participants in the Plan may purchase additional shares of Common Stock
by (i) having the cash distributions on all, or part, of their shares of Common
Stock automatically reinvested, (ii) by receiving directly, as usual, their cash
distributions, if, as and when declared, on shares of Common Stock registered in
their names and investing in the Plan by making cash payments of not less than
$500 per payment or more than $40,000 per calendar quarter ("optional cash
payments"), or (iii) by investing both their cash distributions and such
optional cash payments.
Stockholders may begin participating in the Plan by completing an
Authorization Card and returning it to the Plan Agent. Participants may
terminate their participation at any time. Stockholders who do not wish to
participate in the Plan need not take any action and will continue to receive
their cash dividends, if, as and when declared, as usual. It is suggested that
this Prospectus be retained for future reference.
The Plan does not represent a change in the Company's dividend policy
or a guarantee of future dividends. Dividends will continue to depend on
earnings, financial requirements and other factors. The Company reserves the
right to terminate the Plan at any time.
The price per share for the additional shares of Common Stock purchased
from the Company with reinvested cash distributions and optional cash payments
will be 95% of the Market Price (as defined in the Plan) on the Investment Date
(as defined in the Plan).
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is December 19, 1996.
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement (of which this Prospectus is a part) on
Form S-3 under the Securities Act with respect to the securities offered hereby.
This Prospectus does not contain all of the information set forth in the
Registration Statement, certain portions of which have been omitted as permitted
by the rules and regulations of the Commission. Statements contained in this
Prospectus as to the content of any contract or other document are not
necessarily complete, and in each instance reference is made to the copy of the
contract or other document filed as an exhibit to the Registration Statement,
each statement being qualified in all respects by that reference and the
exhibits to the Registration Statement. For further information regarding the
Company and the Common Stock offered hereby, reference is hereby made to the
Registration Statement and the exhibits to the Registration Statement which may
be obtained from the Commission at its principal office in Washington, D.C.,
upon payment of fees prescribed by the Commission.
The Company is subject to the information requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports, proxy and information statements and other
information with the Commission. The reports, proxy and information statements,
the Registration Statement and exhibits thereto, and other information filed by
the Company with the Commission can be inspected and copied at the Public
Reference Section of the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the regional offices of the
Commission located at 13th Floor, 7 World Trade Center, New York, New York
10048, and at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511.
Copies of the material can be obtained from the Public Reference Section of the
Commission at Room 1024, Judiciary Plaza,, 450 Fifth Street, N.W., Washington,
D.C. 20549 at prescribed rates. The Commission also maintains a Web site at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding issuers of securities which file electronically with
the Commission. The Company's Common Stock is traded on the New York Stock
Exchange, Inc. (the "NYSE"). The reports, proxy and information statements and
other information can also be inspected at the offices of the NYSE, 20 Broad
Street, New York, New York 10005.
The Company furnishes its stockholders with annual reports containing
financial statements audited by its independent auditors and with quarterly
reports containing unaudited summary financial information for each of the first
three quarters of each fiscal year.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents previously filed by the Company with the
Commission (Commission File No. 1-9792) are incorporated herein by reference:
(i) The Company's Annual Report on Form 10-K for the year
ended December 31, 1995;
(ii) The Company's Quarterly Reports on Form 10-Q for the
quarters ended March 29, 1996, June 28, 1996 and September 27, 1996;
(iii) Current Report on Form 8-K dated October 23, 1996;
(iv) The description of the Common Stock contained in the
Company's Registration Statement on Form 8-A filed with the Commission
under the Exchange Act on December 9, 1987, as amended by the Company's
Form 8 dated December 16, 1987, and as updated (A) in the Registration
Statement on Form S-3, effective June 23, 1993 (Commission File No.
33-63060), to reflect the increase of the number of shares of
authorized Common Stock from 5,000,000 shares to 15,000,000 shares and
(B) by the Registration Statement on Form 8-A filed with the Commission
under the Exchange Act on December 2, 1994, reflecting the listing of
the Common Stock on the NYSE; and
-2-
<PAGE>
(v) The description of the Preferred Stock Purchase Rights
contained in the Company's Registration Statement on Form 8-A filed
with the Commission under the Exchange Act on October 29, 1996, and as
amended by the Company's Form 8-A filed with the Commission on November
12, 1996.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Common Stock made hereby shall
be deemed to be incorporated by reference into this Prospectus.
Any statement contained in a document all or a portion of which is
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of the Registration Statement and this
Prospectus to the extent that a statement contained in the Registration
Statement, this Prospectus, or any other subsequently filed document that is
also incorporated by reference herein modifies or supersedes that statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a Prospectus is delivered, upon written
or oral request of that person, a copy of any document incorporated herein by
reference (other than exhibits to those documents unless the exhibits are
specifically incorporated by reference into the documents that this Prospectus
incorporates by reference). Requests should be directed to Michael G. Brinkley,
Cavalier Homes, Inc., 719 Scott Avenue, Suite 600, Wichita Falls, Texas 76307.
-3-
<PAGE>
THE COMPANY
The Company is a Delaware corporation incorporated in 1985, with its
principal executive offices located at Highway 41 North and Cavalier Road,
Addison, Alabama 35540 (telephone number: (205) 747-1575). The Company also
maintains administrative offices at 719 Scott Avenue, Suite 600, Wichita Falls,
Texas 76301 (telephone number: (817) 723-5523). Unless otherwise indicated by
the context, references to the "Company" or to "Cavalier" include Cavalier
Homes, Inc., its subsidiaries and their respective predecessors, if any.
The Company designs and manufactures a wide range of high quality
manufactured homes and markets its homes primarily in the southeastern United
States, with a focus on serving the low-to medium-price manufactured housing
market. During 1995, approximately 77% of the Company's revenues were generated
from sales in its core markets of Alabama, North Carolina, Mississippi, South
Carolina, Texas, Georgia, Louisiana and Tennessee. The Company, through its
wholly-owned subsidiaries, currently operates 13 manufacturing facilities, seven
of which are located in Alabama, two each in North Carolina and Texas, and one
each in Georgia and Pennsylvania. The Company's facilities have an aggregate
capacity to produce approximately 24,000 floor sections per year.
The Company's homes are sold under the Cavalier, Pacesetter, Brigadier,
Knox, Buccaneer, Challenger, Parkwood, Mansion, Olympic, Plantation, Town and
Country, Astro, Riverchase and various other brand names. As of December 31,
1995, the Company's homes were sold through approximately 500 independent
dealers (including 93 independent exclusive dealers) operating approximately 575
retail sales centers located in 32 states. The Company's homes normally include
furniture and appliances and are comprised of one or more floor sections.
Single-section homes range in size from 550 to 1,248 square feet and are sold at
retail prices ranging from approximately $13,000 to $30,000. Multi-section homes
range in size from 880 to 2,128 square feet and are sold at retail prices
ranging from approximately $20,000 to $75,000.
The Company began offering retail installment sale financing in March
1992 through Cavalier Acceptance Corporation ("CAC"), the Company's wholly-owned
finance subsidiary, for homes sold to qualifying retail customers of the
Company's independent exclusive dealers. The Company believes that it is the one
of the few major manufactured home producers in the United States offering
retail consumer financing through independent dealers. Consumer installment
sales contracts that are originated by the Company's independent exclusive
dealers and conform to the Company's credit policies are purchased by CAC
without recourse to the dealership. CAC currently offers four conventional loan
programs for use by dealerships, which programs require a down payment by the
consumer ranging from 0% to 20% of the purchase price in cash, trade-in value of
a previously owned manufactured home or appraised value of equity in any real
property pledged as collateral. Repayment terms range from 84 to 240 months,
depending upon the amount financed, the amount of the down payment and the
customer's creditworthiness. The loans typically are secured by a purchase money
security interest in the manufactured home and, in certain instances, a mortgage
on real property pledged as additional collateral. Loans purchased by CAC
generally provide a fixed rate of interest with equal monthly payments. At
December 31, 1995, CAC operated in 15 states and served all of the Company's
exclusive dealerships.
DESCRIPTION OF THE PLAN
The following, in question and answer form, is a summary description of
the provisions of the Dividend Reinvestment and Stock Purchase Plan of the
Company. This description should be read in conjunction with, and is qualified
in its entirety by reference to, the Plan, a copy of which is attached to this
Prospectus as Appendix A. Capitalized terms not otherwise defined herein shall
have the meanings ascribed thereto in the Plan.
-4-
<PAGE>
Purpose
1. What is the purpose of the Plan? The purpose of the Plan is to
provide holders of shares of Common Stock with an opportunity to reinvest cash
dividends in additional shares of Common Stock and/or make optional cash
payments for additional shares of Common Stock, without payment of any brokerage
commission, service charge or other expense. Shares of Common Stock for the Plan
will be purchased directly from the Company. No shares of Common Stock will be
purchased for the Plan in the open market. The Company will receive the proceeds
from the sale of shares of Common Stock under the Plan and will use such
proceeds for general corporate purposes. See "Use of Proceeds."
Advantages
2. What are the options available to Stockholders? Participants in the
Plan may purchase additional shares of Common Stock by (i) having the cash
dividends on all, or part, of their shares of Common Stock automatically
reinvested, (ii) by receiving directly, as usual, their cash dividends, if, as
and when declared, on their shares of Common Stock and investing in the Plan by
making cash payments of not less than $500 per payment or more than $40,000 per
calendar quarter, or (iii) by investing both their cash dividends and such
optional cash payments.
3. What are the advantages of the Plan? No brokerage commissions, fees
or service charges are paid by Participants in connection with purchases under
the Plan; provided, however, that if shares of Common Stock are registered in
the name of a nominee or broker, such nominee or broker may charge a commission
or fee. Full investment of dividends is possible under the Plan because the Plan
permits fractional shares, as well as whole shares, of Common Stock, to be
purchased and credited to Participants' account. Regular statements of account
provide simplified record keeping. All purchases, by reinvestment of dividends
or optional cash payments, will be credited to the Participant's Noncertificated
Share account on the records of the Company maintained by the Plan Agent.
The price of shares of Common Stock purchased under the Plan with
reinvested cash dividends and optional cash payments is 95% of the Market Price
(as defined in the Plan) for such shares on the applicable Investment Date (as
hereinafter defined).
Administration
4. Who administers the Plan for Participants? The Plan Agent
administers the Plan for Participants, keeps records, sends statements of
account to Participants and performs other duties relating to the Plan. The
current Plan Agent is Mellon Securities Trust Company. The Plan Agent also
serves as Transfer Agent for the shares of Common Stock. Should the Plan Agent
resign, or be asked to resign, another agent will be asked to serve.
All optional cash payments, requests for withdrawal and all other
communication, including certificates to be deposited to plan accounts, should
be sent to the Plan Agent addressed as follows:
-5-
<PAGE>
Mellon Securities Trust Company
c/o ChaseMellon Shareholder Services
P. O. Box 750
Pittsburgh, Pennsylvania 15230
Participation
5. Who is eligible to participate? All holders of record of shares of
Common Stock are eligible to participate in the Plan. Beneficial owners whose
shares of Common Stock are registered in names other than their own (for
instance, in the name of a broker, bank nominee or other record holder) may
participate only in the dividend reinvestment portion of the Plan by making
arrangements with their broker or bank to participate on their behalf through
the Depository Trust Company Dividend Reinvestment Service. Brokers and nominees
owning shares of Common Stock held at Depository Trust Company may participate
in the Plan through that service. Only holders of record may participate in the
optional cash payment feature of the Plan. The Company reserves the right to
refuse to permit a broker, bank nominee or other record holder to participate in
the Plan if the terms of such participation would, in the Company's sole
judgment, result in excessive cost or burden on the Company. In addition, the
Company may refuse participation in the Plan to stockholders residing in states
whose securities laws do not exempt shares of Common Stock offered pursuant to
the Plan from registration.
6. How does a Stockholder join the Plan? In order to participate in the
Plan, an eligible stockholder must properly complete the Authorization Card
furnished by the Plan Agent and return it to Mellon Securities Trust Company,
c/o ChaseMellon Shareholder Services, P. O. Box 750, Pittsburgh, Pennsylvania
15230. An Authorization Card and postage-paid envelope are enclosed with this
Prospectus and additional cards may be obtained at any time by stockholders by
written or oral request to the Plan Agent at the foregoing address.
Telephone requests or general inquiries may be made by calling (800) 526-0801.
7. What does the Authorization Card provide? The Authorization Card
provides for the purchase by stockholders of additional shares of Common Stock
through the following investment options offered under the Plan:
Full Dividend Reinvestment -- Directs the Plan Agent to reinvest cash
dividends with respect to all shares of Common Stock owned by the
Participant (including whole and fractional shares acquired under the
Plan) and permits a Participant to make optional cash payments for the
purchase of additional shares of Common Stock in accordance with the
Plan.
Partial Dividend Reinvestment -- Directs the Plan Agent to remit cash
dividends on the number of shares of Common Stock specified on the
Authorization Card and to invest in additional shares of Common Stock
any dividends paid on the remaining shares of Common Stock owned by the
Participant. This investment option also permits a Participant to make
optional cash payments for the purchase of additional shares of Common
Stock in accordance with the Plan.
Optional Cash Contributions -- Permits a Participant to make optional
cash payments for the purchase of additional shares of Common Stock in
accordance with the Plan.
Cash dividends on shares of Common Stock credited to the Participant's
account under the Plan are automatically reinvested to purchase additional
shares of Common Stock.
-6-
<PAGE>
Stockholders who do not wish to participate in the Plan will receive
cash dividends as declared, in the usual manner.
8. Is partial participation possible under the Plan? A stockholder who
desires the dividends on only some full shares of Common Stock to be reinvested
under the Plan may indicate such number of shares of Common Stock on the
Authorization Card under the heading "Partial Dividend Reinvestment." Cash
dividends will continue to be paid on the remaining shares of Common Stock.
9. When may a Stockholder join the Plan? If an Authorization Card
specifying "Full Dividend Reinvestment," or "Partial Dividend Reinvestment" is
properly completed and received by the Plan Agent at least five business days
prior to the record date established for the payment of the next dividend,
reinvestment will commence with that dividend payment. The record dates for
dividend payments on the Common Stock are generally on or about the 30th day of
January, April, July and October of each year. If the Authorization Card is
received subsequent to five business days prior to the record date, reinvestment
of the dividends (or designated portion thereof) will not start until payment of
the next following dividend. If the Authorization Card is received in between
any dividend record date and the Investment Date (the date on which a dividend
is paid, which the Company anticipates to be on or about the 15th day of
February, May, August and November each year), that dividend will be paid in
cash and the stockholder's initial dividend reinvestment will begin with the
next dividend. The Investment Date is also the Dividend Payment Date.
Each Participant in the Plan may invest in addition shares of Common
Stock by making optional cash payments at any time. Participants in the Plan
have no obligation to make any optional cash payments. Optional payments may be
made at irregular intervals and the amount of each optional cash payment may
vary, but no optional payments may be less than $500 and the total optional
payments invested by each Participant may not exceed $40,000 per calendar
quarter. An optional cash payment may be made by enclosing a check or money
order with the Authorization Card when enrolling; and thereafter by forwarding a
check or money order attached to each statement of account. Checks and money
orders must be in United States dollars and should be made payable to the Plan
Agent, Mellon Securities Trust Company. No interest will be paid on optional
cash payments held by the Plan Agent pending the purchase of shares of Common
Stock. (See Questions 13, 14 and 16.)
Optional cash payments must be received by the Plan Agent no later than
five (5) business days prior to the Investment Date. Optional cash payments
received by the Plan Agent will be returned to Participants upon written request
received by the Plan Agent at least five (5) business days prior to the
Investment Date.
Costs
10. Are there any expenses to Participants in connection with purchases
under the Plan? No. Participants will incur no brokerage commissions, service or
other charges for purchases made under the Plan. Any costs of administration of
the Plan will be borne by the Company.
-7-
<PAGE>
Purchases
11. How many shares of Common Stock will be purchased for Participants?
The number of shares of Common Stock to be purchased will be determined by the
amount of the Participant's dividends and/or optional cash payments being
reinvested or paid and the price of the shares of Common Stock. Each
Participant's account in the Plan will be credited with the number of shares of
Common Stock, including fractional shares computed to three (3) decimal places,
equal to the amount of the dividends, and/or optional cash to be reinvested or
paid divided by the applicable purchase price of the shares of Common Stock.
12. How will the purchase price of shares of Common Stock be
determined? The officers of the Company will determine the price of shares of
Common Stock to be purchased. It is intended that the price of the shares of
Common Stock to be purchased will be at a 5% discount from the Market Price. The
shares of Common Stock are traded on the NYSE. The officers of the Company will
fix the reinvestment price at a discount price equal to 95% of the Market Price.
The price at which the shares of Common Stock will be purchased will be the
higher of 95% of the average of the daily high and low sale prices of the
Company's Common Stock on the NYSE on the four trading days including and
preceding the Investment Date or 95% of the average of the high and low sale
prices of the Company's Common Stock on the NYSE on the Investment Date. In the
event there is no trading in the shares of Common Stock, or if for any reason
the Company and the Plan Agent have difficulty in determining the price of
shares of Common Stock to be purchased under the Plan, the Company, on
consultation with the Plan Agent, will use such other public reports or sources
as the Company deems appropriate to determine the Market Price and the
appropriate 5% discount. If the reinvestment price involves a fraction, it will
be expressed in one-eighth of a point, with a rounding out to the next higher
one-eighth of a point.
13. When will dividends and/or optional cash payments be invested?
Reinvestment of dividends and investment of optional cash payments will be made
on the date when the dividend becomes payable (the "Investment Date" or
"Dividend Payment Date"). Participants will become owners of shares of Common
Stock purchased under the Plan as of the date of purchase. In order to allow
sufficient time for processing, optional cash payments must be received by the
Plan Agent no later than five (5) business days prior to the Dividend Payment
Date. Optional cash payments received by the Plan Agent subsequent to five (5)
business days prior to a Dividend Payment Date will be applied to the purchase
of shares of Common Stock on the Investment Date falling in the next succeeding
quarter.
14. What is the Investment Date? There is only one Investment Date in
each quarter. The Investment Date will be the Dividend Payment Date. If an
Investment Date falls on a Saturday, Sunday or holiday, the Investment Date will
be the next following business day. If no dividend is paid in a quarter, the
Dividend Payment Date for purposes of optional cash investment will be deemed to
be February 15, May 15, August 15 and November 15.
15. Will certificates be issued to Participants for shares of Common
Stock purchased under the Plan? No certificates for shares of Common Stock
acquired by a Participant under the Plan will be issued, except as described in
Question 18. Shares of Common Stock purchased under the Plan, whether through
dividend reinvestment or optional cash payment, will be credited to a
Participant's Noncertificated Share account and will be shown on a Participant's
statement of account. Certificates for the shares of Common Stock purchased
pursuant to the Plan will be issued to Participants upon their written request,
except that no certificates will be issued for fractional shares of Common
Stock. A Participant requesting a certificate for all the shares of Common Stock
in the Participant's Noncertificated Share account will receive cash for the
fractional shares only if participation in the Plan is terminated. (See Question
18 for how a Participant may obtain certificates.) Cash dividends on all shares
of Common Stock held in the Participant's Noncertificated Share account under
the Plan will be automatically reinvested to purchase additional shares of
Common Stock which will be reflected in the Participant's Noncertificated Share
account.
-8-
<PAGE>
Optional Cash Payments
16. Who is eligible to make optional cash payments? Record owners of
shares of Common Stock who have executed an Authorization Card are eligible to
make optional cash payments of not less than $500 nor more than $40,000 per
calendar quarter. A stockholder may participate in the Plan exclusively by
making an optional cash payment by checking the "Optional Cash Contributions"
box on the Authorization Card. Moreover, even if the "Optional Cash
Contributions" box is checked, all dividends payable on shares of Common Stock
purchased with optional cash payments and retained in the Participant's
Noncertificated Shares account will be automatically reinvested in additional
shares of Common Stock. A beneficial owner of shares of Common Stock who wishes
to make optional cash payments must become the record owner by transferring all
or some of his or her shares into his or her own name. Checks or money orders
should be payable to Mellon Securities Trust Company and mailed to the Plan
Agent, Mellon Securities Trust Company, c/o ChaseMellon Shareholder Services, P.
O. Box 750, Pittsburgh, Pennsylvania 15230. Do not send cash. Payments delivered
to any other address will not constitute valid delivery. No interest is paid on
optional cash payments. Optional cash payments must be received by the Plan
Agent no later than five (5) business days prior to the Investment Date.
Participants can request the return of any optional cash payment which had not
yet been invested, provided such request is received by the Plan Agent at least
five (5) business days prior to the Investment Date. In the event any check or
money order from a bank account is returned unpaid for any reason, the Plan
Agent will consider the request for investment of such money null and void and
shall immediately remove from the Participant's Plan account shares of Common
Stock, if any, purchased upon the prior credit of such money. The Plan Agent
shall thereupon be entitled to sell these shares to satisfy any uncollected
amounts. If the net proceeds of the sale of such shares are insufficient to
satisfy the balance of such uncollected amounts, the Plan Agent shall be
entitled to sell such additional shares from the Participant's Plan account to
satisfy the uncollected balance.
Report to Participants
17. What type of reports will be sent to Participants in the Plan?
Participants will receive a quarterly statement indicating the total dividend
payment, the amount of the dividend payment reinvested, the purchase price per
share of Common Stock, the number of shares of Common Stock purchased and the
number of shares of Common Stock in the Participant's Noncertificated Share
account. These statements are a record of the cost of purchases under the Plan
and should be retained for tax purposes. In addition, each Participant will
receive copies of the Company's annual and quarterly reports to stockholders,
proxy statements and income tax information for reporting dividends. Beneficial
owners whose shares of Common Stock are registered in names other than their own
(for instance, in the name of a broker, bank nominee or other record holder)
must arrange to obtain their copies of such reports from the record holder.
-9-
<PAGE>
Issuance of Certificates
18. How may a Participant obtain certificates for shares of Common
Stock purchased under the Plan? A Participant who has purchased shares of Common
Stock under the Plan may obtain certificates for those shares of Common Stock in
the Participant's Noncertificated Share account at any time by sending a written
request to that effect to the Plan Agent. No certificates will be issued for
fractional shares of Common Stock, but a Participant requesting termination of
participation in the Plan may receive, in cash, the market price of any
fractional shares of Common Stock as well as certificates for all whole shares
of Common Stock held for such terminating participant in the Noncertificated
Share account. This notice should be mailed to the Plan Agent, Mellon Securities
Trust Company, c/o ChaseMellon Shareholder Services, P. O. Box 750, Pittsburgh,
Pennsylvania 15230. The Company, however, reserves the right at any time to
issue certificates to Participants for any shares of Common Stock in their
Noncertificated Share accounts. (See Questions 19 and 21 for information on
termination of participation.)
Modification or Termination by a Participant
19. How does a Participant change or terminate participation in the
Plan? A Participant may change participation from partial to total dividend
reinvestment, from total to partial dividend reinvestment, or may simply change
the number of shares of Common Stock which are enrolled in the Plan by executing
and delivering a new Authorization Card to the Plan Agent, Mellon Securities
Trust Company. Any change concerning the reinvestment of dividends must be
received by the Plan Agent not later than five (5) business days prior to the
record date for a dividend in order for the change to become effective with that
dividend.
A Participant may terminate participation in the Plan by notifying the
Plan Agent in writing at least five (5) business days prior to the record date
for determining the holders entitled to receive the next dividend. Notices will
be effective only upon receipt by the Plan Agent. Notices to change or
discontinue dividend reinvestment received by the Plan Agent at least five (5)
business days prior to any record date for a dividend payment will be effective
as of that date. In order to re-enter the Plan after termination, a stockholder
must complete a new Authorization Card.
20. Can the shares of Common Stock held in the Plan be sold through the
Plan Agent? A Participant can instruct the Plan Agent to sell any or all of the
whole shares of Common Stock held in the Plan. The written notification to the
Plan Agent should include the number of shares of Common Stock that are to be
sold. The Plan Agent will make the sale as soon as practicable following receipt
of a Participant's request through independent securities brokers selected by
the Company or the Plan Agent in its sole discretion. A check for the proceeds
of such sale, less brokerage commission and transfer taxes (if any), will
usually be sent by the Plan Agent on the settlement date, which will be three
(3) business days from the date of sale. No Participant shall have the authority
or power to direct the date or sales price at which shares of Common Stock may
be sold. Requests must indicate the minimum number of shares to be sold and not
the dollar amount to be attained. Any such request that does not clearly
indicate the number of shares of Common Stock to be sold will be returned to the
Participant with no action taken. A withdrawal/termination form is provided on
the reverse side of the account statement for this purpose. This notice should
be addressed to Mellon Securities Trust Company, c/o ChaseMellon Shareholder
Services, P. O. Box 750, Pittsburgh, Pennsylvania 15230.
-10-
<PAGE>
21. What happens to the shares of Common Stock held in the
Noncertificated Share account when a Participant terminates participation in the
Plan? A certificate for the shares of Common Stock held in the account will be
issued to the Participant upon the Participant's written request or upon a
Participant's termination of participation in the Plan. No fractional shares
will be issued. (See Question 15 for information on share certificates and
Question 18 for information on the cash payment for fractional shares in the
account.)
Other Information
22. What happens if the Company issues a stock dividend, declares a
stock split or has a rights offering? Any shares of Common Stock issued in a
stock dividend or stock split with respect to a Participant's shares of Common
Stock which are subject to the Plan will be added to the Participant's
Noncertificated Share account. If the Company has a rights offering in which
separately tradable and exercisable rights are issued to registered holders of
Common Stock, the rights attributable to whole shares of Common Stock in a
Participant's Plan account will be transferred to the Participant as promptly as
practicable after the rights are issued. No partial rights will be issued with
respect to fractional shares of Common Stock in the Participant's account.
23. How will Shares in a Participant's Noncertificated Share account be
voted at a meeting of Stockholders? All of a Participant's shares of Common
Stock, both Certificated and Noncertificated, may be voted by the Participant.
For any meeting of stockholders, the Participant will be sent proxy material for
that meeting covering all of the shares of Common Stock that the Participant
owns on the record date for the meeting. The Participant may vote all of
Participant's shares of Common Stock in person or by proxy.
24. What are the Federal income tax consequences of participation in
the Plan? Under the current provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), the purchase of shares of Common Stock under the Plan will
generally result in the following Federal income tax consequences:
(a) A distribution on the shares of Common Stock will be treated
for Federal income tax purposes as a dividend distribution
received by the Participant notwithstanding that it is used to
purchase additional shares of Common Stock pursuant to the
Plan. The full amount of cash distributions reinvested under
the Plan, plus the 5% purchase discount from the applicable
Market Price, represents dividend distributions to
Participants. As in the case of cash dividend distributions,
the full amount will be taxable income to the extent of the
Company's current and accumulated earnings and profits,
and the excess will be a return of capital which reduces the
basis of the Participant's shares of stock in the Company or
results in gain to the extent it exceeds such stock basis.
(b) For optional cash payments, Participants in the Plan will be
treated as having received a cash dividend on the Investment
Date equal to the excess, if any, of the Market Price of such
shares on the Investment Date over the amount of the optional
cash payment. The tax basis of the shares will be equal to the
sum of the amount of the optional cash payment plus the amount
included in income.
(c) A Participant's tax basis in additional shares of Common Stock
acquired under the Plan will be equal to the full amount
treated as a dividend distribution for Federal income tax
purposes. The Participant's holding period for such shares of
Common Stock will commence on the day after the Investment
Date.
-11-
<PAGE>
(d) A Participant will not realize any taxable income upon the
receipt of a certificate for full shares of Common Stock
credited to the Participant's account. A Participant will
recognize gain or loss when a fractional share interest is
liquidated or when the Participant sells or exchanges shares
of Common Stock received from the Plan. Such gain or loss will
equal the difference between the amount which the Participant
receives for such fractional share interest or such shares and
the tax basis therefor.
In the case of Participants whose distributions are subject to
withholding of Federal income tax, distributions will be reinvested less the
amount of tax required to be withheld.
The above is intended only as a general discussion of the current
Federal income tax consequences of participation in the Plan. Participants
should consult their own tax advisors regarding the Federal and state income tax
consequences (including the effects of any changes in law) of their individual
participation in the Plan.
25. What provision is made for foreign participants subject to income
tax withholding or other Participants subject to back-up withholding? In the
case of both foreign Participants who elect to have their distributions
reinvested and whose distributions are subject to United States income tax
withholding and other Participants who elect to have the distributions
reinvested and who are subject to "backup" withholding under Section 3406(a)(1)
of the Code, the Plan Agent will invest in shares of Common Stock in an amount
equal to the distributions of such Participants less the amount of tax required
to be withheld. The quarterly statements confirming purchases made to such
Participants will indicate the net payment reinvested.
Under Section 3406(a)(1) of the Code, the Company is currently required
to withhold for United States income tax purposes 31% of all distribution
payments to a stockholder if (i) such stockholder has failed to furnish to the
Company his taxpayer identification number ("TIN"), which for an individual is
his social security number, (ii) the Internal Revenue Service (the "Service")
has notified the Company that the TIN furnished by the stockholder is incorrect,
(iii) the Service notifies the Company that back-up withholding should be
commenced because the stockholder has failed to properly report distributions or
(iv) the stockholder has failed to certify, under penalties of perjury, that he
is not subject to back-up withholding. Stockholders have previously been
requested by the Company or their broker to submit all information and
certifications required in order to exempt them from back-up withholding if such
exemption is available to them.
Optional cash payments received from foreign participants must be in
United States dollars and will be invested in the same way as payments from
other Participants.
26. What are the federal income tax consequences of participation in
the Plan by an IRA, Keogh Plan, 401(k) Plan, Simplified Pension Account or any
corporate employer-sponsored retirement plan? The tax consequences of
participation in the Plan by retirement plans differ from those outlined above
for individuals. Since the law and regulations regarding the Federal income tax
consequences of retirement plan participation are complex and subject to change,
those considering such participation should consult with their own retirement
plan trustees, custodians or tax advisors for specific information.
-12-
<PAGE>
27. What is the responsibility of the Company under the Plan? Neither
the Company nor the Plan Agent will be liable for any act done in good faith or
for any good faith omission to act, including, without limitation, any claim of
liability arising out of failure to terminate participation in the Plan upon a
Participant's death. In addition, no stockholder, director, officer, employee,
representative or agent of the Company shall be personally liable for the
satisfaction of the Company's obligations under the Plan and a Participant shall
look solely to the assets of the Company for satisfaction of any claims
thereunder.
Participants should recognize that neither the Company nor the Plan
Agent can provide any assurance of a profit or protection against loss on any
shares of Common Stock purchased under the Plan.
28. May the Plan by changed or discontinued? While the Company hopes to
continue the Plan indefinitely, the Company reserves the right to suspend or
terminate the Plan at any time. It also reserves the right to make modifications
to the Plan and in particular reserves the right to refuse optional cash
payments from any stockholder who, in the sole discretion of the Company, is
attempting to circumvent the intent of the Plan by making excessive optional
cash payments through multiple stockholder accounts. Participants will be
notified of any suspension, termination or modification of the Plan.
The Company could lower or eliminate the discount without prior notice
to Participants if for any reason the Company believes that Participants were
engaging in positioning and other transactions with the intent to purchase
shares of Common Stock under the Plan and then immediately reselling such shares
of Common Stock in order to capture the discount. Any Participants who engage in
such transactions may be deemed to be underwriters within the meaning of Section
2(11) of the Securities Act of 1933.
29. Who answers a Participant's questions or supplies information? Any
inquiries or correspondence about the Plan should be addressed as follows:
Mellon Securities Trust Company, c/o ChaseMellon Shareholder Services, P. O. Box
750, Pittsburgh, Pennsylvania 15230. Telephone inquires to the Plan Agent should
be made to (800) 526-0801.
30. Will the Plan Agent hold certificated shares? The Plan provides a
share deposit feature to eliminate the need for Participants to hold physical
Common Stock certificates. If a Participant currently holds physical Common
Stock certificates and would like to combine these shares with his Plan shares
held in book-entry, the Participant should complete the tear-off section of his
account statement and complete the portion designated for share deposit. The
certificates need not be endorsed. The Participant should ensure that his Common
Stock certificates are sent by registered/insured mail or by some other similar
means as the Participant bears the risk of loss in transit. Participants should
be aware that dividends on the shares so deposited will be automatically
reinvested. Certificates should be sent to the address set forth in response to
Question 4.
USE OF PROCEEDS
The net proceeds from the sale, from time to time, of the shares of
Common Stock by the Company under the Plan will be used by the Company for
general corporate purposes. Pending such uses, net proceeds may be invested
temporarily in short-term or intermediate-term government securities,
obligations of the Government National Mortgage Association, bankers'
acceptances, certificates of deposit of commercial banks and savings and loan
associations which are members of the Federal Deposit Insurance Corporation,
deposits in members of the Federal Home Loan Bank System, time deposits,
commercial paper, other money market instruments, bonds, notes, common and
preferred stock.
-13-
<PAGE>
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be
passed upon for the Company by Looper, Reed, Mark & McGraw Incorporated, Dallas,
Texas.
EXPERTS
The financial statements and the related financial statement schedule
incorporated in this Prospectus by reference from the Company's Annual Report on
Form 10-K for the year ended December 31, 1995, have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their report, which is
incorporated herein by reference, and have been so incorporated in reliance upon
the report of such firm given upon their authority as experts in accounting and
auditing.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law provides for the
indemnification of directors and officers of corporations organized thereunder
in certain circumstances. In addition, Section 145 grants to each such
corporation the power to indemnify its directors and officers against liability
for certain of their acts.
The certificate of incorporation and bylaws, as amended, of the Company
provide for indemnification of directors and officers of the Company to the
fullest extent permitted by the law of the State of Delaware against liability
for certain of their acts. Directors and officers liability insurance has also
been obtained by the Company, the effect of which is to indemnify the directors
and officers of the Company against certain damages and expenses because of
certain claims made against them caused by their negligent act, error or
omission.
Insofar as indemnification for liabilities under the Securities Act of
1933, as amended, may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been informed
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is therefore unenforceable.
-14-
<PAGE>
APPENDIX A
CAVALIER HOMES, INC.
Dividend Reinvestment and Stock Purchase Plan
1. Definitions
The following terms when used herein shall have the following
definitions:
"Authorization Card" means such authorization form as the Plan Agent
may from time to time or upon request furnish Stockholders and which shall be
returned to the Plan Agent to indicate their election to participate in
specified portions of the Plan.
"Certificated Shares" means shares of Stock which are evidenced by
physical certificates.
"Company" means Cavalier Homes, Inc.
"Dividend Payment Date" means the Investment Date.
"Investment Date" means each date on which a dividend is paid on the
shares of Stock, which the Company anticipates to be on or about the 15th day of
February, May, August and November each year. If an Investment Date falls on a
Saturday, Sunday or holiday, the Investment Date will be the next following
business day. If no dividend is paid in a quarter, the Dividend Payment Date for
purposes of optional cash investment will be deemed to be February 15, May 15,
August 15 and November 15.
"Market Price" as of any day means the higher of the average of the
daily high and low sale prices of the Company's Stock on the NYSE on the four
Trading Days including and preceding the Investment Date or the average of the
high and low sale prices of the Company's Stock on the NYSE on the Investment
Date.
"Noncertificated Shares" means shares of Stock which are held by the
Plan Agent in an account for each Participant and for which no physical
certificates are issued.
"NYSE" means the New York Stock Exchange, Inc.
"Participant" means any Stockholder who has returned a properly
completed Authorization Card to the Plan Agent indicating election to
participate in any portion of the Plan and who has been enrolled in that portion
of the Plan by the Plan Agent.
"Plan" means this Dividend Reinvestment and Stock Purchase Plan.
"Plan Agent" means any bank or trust company as from time to time may
be appointed by the Company as agent to administer the Plan. Initially, the Plan
Agent shall be Mellon Securities Trust Company and thereafter shall be the
Company or any successor institution appointed by the Company in substitution
therefor.
"Stockholder" means any holder of shares of Stock.
"Stock" means the common stock, par value $0.10 per share, of the
Company.
-15-
<PAGE>
"Trading Day" means a day on which the NYSE is open for trading.
2. Purpose
The purpose of this Plan is to provide Stockholders with a convenient
and economical method for having all or part of their dividends automatically
reinvested in additional shares of Stock and making voluntary cash investments
in shares of Stock, in either case without payment of any brokerage commission
or service charge. Because shares of Stock will be purchased for the Plan
directly from the Company by the Plan Agent, the Plan will assist the Company in
raising funds for general business purposes. The Plan does not reflect a change
in the Company's dividend policy or a guarantee of future dividends, which will
continue to be determined by the Board of Directors based on the Company's
results of operations, financial condition, regulatory requirements and other
factors.
3. Eligibility for Participation
All Stockholders of record are automatically eligible to participate in
the Plan and may do so by completing and returning to the Plan Agent the
Authorization Card furnished to them by the Plan Agent. Beneficial owners of
shares of Stock which are registered in names other than their own (e.g., in the
name of a broker, bank nominee or other record holder), who want to participate,
may participate only in the dividend reinvestment portion of the Plan by making
arrangements with their broker or bank to participate on their behalf through
the Depository Trust Company Dividend Reinvestment Service. Only record holders
may participate in the optional cash payment feature of the Plan. The Company
reserves the right to refuse to permit a broker, bank nominee or other record
holder to participate in the Plan if the terms of such participation would, in
the Company's sole judgment, result in excessive cost or burden on the Company.
4. Administration of the Plan
The Plan Agent shall administer the Plan and will maintain records and
perform such other duties as may be required. In addition, the Plan Agent will
send each Participant (a) after each dividend reinvestment, a statement which
will indicate the amount of the dividend, the purchase price per share of Stock,
the number of shares of Stock purchased and the total number of Noncertificated
Shares owned by the Participant; (b) upon investment of optional cash payments,
a statement indicating purchase price, number of shares of Stock purchased, and
the total number of Certificated and Noncertificated Shares owned by the
Participant; and (c) annual and quarterly reports to Stockholders, proxy
statements and income tax information for reporting dividends earned. Shares of
Stock purchased by a Participant through reinvested dividends or optional cash
payments will be credited to the Participant's Noncertificated Share Account.
Upon request of a Participant, the Plan Agent will furnish certificates for
shares of Stock in the Participant's Noncertificated Share Account. No
certificates will be issued for fractional shares of Stock, but the market price
thereof will be paid in cash to a requesting Stockholder who is terminating
participation in the Plan. The Plan Agent will have the responsibility for
furnishing certificates for shares of Stock upon request or termination of
participation by the Stockholder.
5. Reinvestment of Dividends
Stockholders may join the Plan at any time. Stockholders may elect to
have dividends on all or part of their shares of Stock automatically reinvested
by completing the Authorization Card provided by the Plan Agent to that effect
and returning it to the Plan Agent. If the Authorization Card is received by the
Plan Agent five (5) business days prior to the record date for the payment of
the next dividend, reinvestment will begin with that dividend. The record dates
for dividend payments on shares of the Stock are generally on or about January
30, April 30, July 30 and October 30. If the Authorization Card is received
subsequent to five (5) business days prior to the record date, that dividend
will be paid in cash and the stockholder's initial dividend reinvestment will
begin with the next dividend. The purchase price per share for shares of Stock
purchased for the Plan with reinvested dividends and/or optional cash payments
shall be 95% of the Market Price. Cash dividends on shares of Stock credited to
the Participant's account will be automatically reinvested to purchase
additional shares of Stock.
-16-
<PAGE>
6. Optional Cash Payments
Each Participant in the Plan may invest in addition shares of Common
Stock by making optional cash payments at any time. Participants in the Plan
have no obligation to make any optional cash payments. Optional payments may be
made at irregular intervals and the amount of each optional cash payment may
vary, but no optional payments may be less than $500 and the total optional
payments invested by each Participant may not exceed $40,000 per calendar
quarter. An optional cash payment may be made by enclosing a check or money
order with the Authorization Card when enrolling; and thereafter by forwarding a
check or money order attached to each statement of account. Checks and money
orders must be in United States dollars and should be made payable to the Plan
Agent, Mellon Securities Trust Company. No interest will be paid on optional
cash payments held by the Plan Agent pending the purchase of shares of Common
Stock.
Optional cash payments must be received by the Plan Agent no later than
five (5) business days prior to the Investment Date. Optional cash payments
received by the Plan Agent will be returned to Participants upon written request
received by the Plan Agent at least five (5) business days prior to the
Investment Date. The purchase price per share for shares of Stock purchase for
the Plan with optional cash payments shall be 95% of the Market Price.
7. Calculation of Shares of Stock Purchased
The number of shares of Stock purchased shall be determined by dividing
the amount of the dividends reinvested and/or optional cash payments made by the
purchase price per share of Stock determined in accordance with Sections 5 and 6
above. Each Participant's account will be credited on each Investment Date with
that number of shares of Stock, plus fractional share interests computed to at
least three (3) decimal points, equal to the total amount of the cash (dividends
and/or optional cash payments) to be invested on behalf of such Participant on
such date divided by the purchase price per share of Stock for that date.
8. Costs
There are no brokerage fees on purchases. All costs of administration
of the Plan are paid by the Company, except that Participants may incur certain
costs in connection with their withdrawal from the Plan if they direct the Plan
Agent to sell their shares of Stock.
9. Source of Stock
Shares of Stock purchased under the Plan come from the legally
authorized but unissued shares of Stock of the Company. Shares of Stock will not
be purchased in the open market.
-17-
<PAGE>
10. Modification or Termination of Participation
Participants may modify their participation in the Plan by notifying
the Plan Agent in writing five (5) business days prior to the record date for
determining the holders of Stock entitled to receive the next dividend that they
wish to reinvest dividends on an increased or decreased number of shares of
Stock specified in such notice. Participants may terminate participation in the
Plan any time by notifying the Plan Agent in writing five (5) business days
prior to the record date for determining the holders of Stock entitled to
receive the next dividend of the Participant's intent to terminate participation
in the Plan. Any notice is effective only upon receipt. If a Participant's
notice of termination or modification is received by the Plan Agent at least
five (5) business days prior to the record date for determining the Stockholders
entitled to receive the next dividend payment, the Plan Agent will modify or
terminate the reinvestment of the Participant's dividends under the Plan as of
that Investment Date. If the notice of termination or modification is received
by the Plan Agent subsequent to five (5) business days prior to the record date
for the next dividend, that dividend will be reinvested in shares of Stock for
the Participant in accordance with the Participant's previous instructions, and
the request for termination or modification will be processed promptly
thereafter. Any optional cash payments sent to the Plan Agent prior to receipt
of the notice of termination or modification will also be invested in shares of
Stock on the next Investment Date unless the Participant requests in writing to
the Plan Agent the return of all or a portion of such optional cash payments at
least five (5) business days prior to the Investment Date. In order to re-enter
the Plan after termination, the Stockholder must complete a new Authorization
Card.
11. Sale of Plan Shares
A Participant can instruct the Plan Agent to sell any or all of the
whole shares of Stock held in the Plan. The written notification to the Plan
Agent should include the number of Shares that are to be sold. The Plan Agent
will make the sale as soon as practicable following receipt of the written
notification and a check for the proceeds less brokerage commission and transfer
taxes (if any) will usually be sent by the Plan Agent to the Participant on the
settlement date, which will be three (3) business days from the date of sale. No
Participant shall have the authority or power to direct the date or sales price
at which shares of Stock may be sold. Requests must indicate the minimum number
of shares of Stock to be sold and not the dollar amount to be attained. Any such
request that does not clearly indicate the number of shares of Stock will be
returned to the Participant with no action taken. A withdrawal/termination form
is provided on the reverse side of the account statement for this purpose. This
notice should be address to Mellon Securities Trust Company, c/o ChaseMellon
Shareholder Services, P. O. Box 750, Pittsburgh, Pennsylvania 15230. Shares of
Stock held in a Participant's account may not be pledged. In order to pledge
such shares, a Participant must request certificates for such shares of Stock.
12. Certificates for Purchased Shares of Stock
No certificates for shares of Stock acquired for a Participant under
the Plan will be issued. Stock purchased under the Plan will be credited to a
Participant's Noncertificated Share account and will be held in the name of the
Plan Agent or its nominee. A Participant who wishes to obtain certificates for
those shares of Stock that he has purchased under the Plan may do so by
notifying the Plan Agent in writing to that effect. No certificate will be
issued for fractional shares of Stock, but the market price of any fractional
shares of Stock will be paid in cash to the Participant requesting a certificate
for all his Noncertificated Shares.
-18-
<PAGE>
13. Stock Splits, Stock Dividends and Rights Offerings
Shares of Stock issued in a stock dividend or stock split with respect
to a Participant's shares of Stock which are subject to the Plan will be
credited to a Participant's Noncertificated Share account. If the Company has a
rights offering in which separately tradable and exercisable rights are issued
to registered holders of Stock, the rights attributable to whole shares of Stock
held in a Participant's Plan account will be transferred to the Participant as
promptly as practicable after the rights are issued. No partial rights will be
issued with respect to fractional shares of Stock in the Participant's account.
14. Voting
All shares of Stock credited to a Participant's Noncertificated Share
account under the Plan may be voted by the Participant. A Participant will
receive a proxy to vote the number of shares of Stock held in his Plan account.
If the Participant returns an executed proxy, it will be voted with respect to
all of Participant's shares of Stock (including any fractional shares of Stock),
or the Participant may vote all of the shares of Stock in person at the meeting.
15. Liability
Neither the Company, nor its duly appointed Plan Agent (if any) in
administering the Plan, shall be liable for any act or failure to act taken in
good faith, including, without limitation, any claim of liability arising out of
failure to terminate a Participant's participation in the Plan upon the
Participant's death. In addition, no Stockholder, director, officer, employee,
representative or agent of the Company shall be personally liable for the
satisfaction of the Company's obligations under this Plan and a Participant
shall look solely to the assets of the Company for satisfaction of any claims
hereunder.
16. Termination, Suspension or Modification
The Company reserves the right to modify, suspend or terminate the Plan
at any time and from time to time, including during the period between the
record date for a dividend payment and the related Investment Date, and in
particular, reserves the right to refuse optional cash payments from any
Stockholder who, in the sole discretion of the Company, is attempting to
circumvent the interest of the Plan by making excessive optional cash payments
through multiple Stockholder accounts.
The Company could lower or eliminate the discount without prior notice
to Participants if for any reason the Company believes that Participants were
engaging in positioning and other transactions with the intent to purchase
shares of Common Stock under the Plan and then immediately reselling such shares
of Common Stock in order to capture the discount. Any Participants who engage in
such transactions may be deemed to be underwriters within the meaning of Section
2(11) of the Securities Act of 1933.
17. Compliance with Applicable Law and Regulations
The Company's obligation to offer, issue or sell shares of Stock
hereunder shall be subject to the Company's obtaining any necessary approval,
authorization and consent from any regulatory authorities having jurisdiction
over the issuance and sale of the shares of Stock. The Company may elect not to
offer or sell its shares of Stock hereunder to Stockholders residing in any
jurisdiction where, in the sole discretion of the Company, the burden or expense
of compliance with applicable blue sky or securities laws make that offer or
sale impracticable or inadvisable.
-19-
<PAGE>
18. Participants Subject to Back-Up Withholding
In the case of both foreign participants who elect to have their
dividends reinvested and whose dividends are subject to United States income tax
withholding and other Participants who elect to have their dividends reinvested
and who are subject to "backup" withholding under Section 3406(a)(1) of the
Internal Revenue Code of 1986, as amended, the Plan Agent shall invest in shares
of Stock in an amount equal to the dividends of such Participants less the
amount of tax required to be withheld.
19. Safekeeping
At a Participant's request, the Plan Agent will receive and hold any
Certificated Shares now held by or for such Participant. A Participant may send
such Certificated Shares to the Plan Agent for credit to such Participant's
account in the Plan. These Certificated Shares will be added to the shares of
Stock in such Participant's account and will appear in subsequent statements in
combination with a Participant's previous Plan shares of Stock and dividends. If
a Participant is interested in having the Plan Agent hold shares of Stock now in
such Participant's possession, write for further information to:
Mellon Securities Trust Company
c/o ChaseMellon Shareholder Services
P. O. Box 750
Pittsburgh, Pennsylvania 15230
-20-
<PAGE>
======================================= =======================================
No person has been authorized
to give any information or to make any
representations other than those
contained herein and, if given or
made, such information or
representations must not be relied
upon as having been authorized by the 200,000 Shares
Company. This Prospectus does not
constitute an offer to sell, or a Cavalier Homes, Inc.
solicitation of an offer to buy, the
securities offered hereby in any
jurisdiction to any person to whom it
is unlawful to make an offer or Common Stock
solicitation. Neither the deliver of Offered by Cavalier Homes, Inc.
this Prospectus nor any sale made to its Stockholders
hereunder shall, under any Solely in Connection with its
circumstances, create an implication Dividend Reinvestment and
that there has not been any change in Stock Purchase Plan
the facts set forth in this Prospectus
or in the affairs of the Company since
the date hereof.
TABLE OF CONTENTS
Page
Available Information............. 2
Incorporation of Certain
Documents by Reference.......... 2 ----------------
The Company....................... 4 PROSPECTUS
Description of the Plan........... 4 ----------------
Use of Proceeds.................. 13
Legal Matters.................... 13
Experts.......................... 13 December 19, 1996
Indemnification of
Directors and Officers......... 13
Dividend Reinvestment
and Stock Purchase
Plan........................... 15
======================================= =======================================
-21-
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
Item................................................... Amount
SEC registration fee...................................$ 693.33
Blue Sky legal fees and expenses....................... 5,000.00
Printing expenses...................................... 5,000.00
Legal fees and expenses................................ 15,000.00
---------
Total..................................................$ 25,693.33
=========
Item 15. Indemnification of Directors and Officers
(a) Article VII of the By-laws of the Registrant provides for
indemnification of directors and officers, in certain
instances. The provisions of said Article are as follows:
SECTION 1. Indemnification in Actions Arising Out of Capacity as
Officer, Director, Employee or Agent. The corporation shall indemnify
any person who was or is a party or is threatened to be made a party to
any threatened, pending, or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an
action by or in the right of the corporation) by reason of the fact
that he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as
a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with
such action, suit or proceeding if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was
unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person
did not act in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had reasonable cause
to believe that his conduct was unlawful.
SECTION 2. Indemnification in Actions by or in Right of Corporation.
The corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense
or settlement of such action or suit if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification shall
be made in respect to any claim, issue or matter as to which such
person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the corporation unless and
only to the extent that the Delaware Court of Chancery or the court in
which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such court shall deem
proper.
II-1
<PAGE>
SECTION 3. Indemnification When Successful on Merits or Otherwise. To
the extent that a director, officer, employee or agent of the
corporation has been successful on the merits or otherwise in defense
of any action, suit or proceeding referred to in Sections 1 and 2 of
this Article VII, or in defense of any claim issue or matter therein,
he shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection therewith.
SECTION 4. Determination of Meeting Applicable Standard. Any
indemnification under Sections I and 2 of this Article VII (unless
ordered by a court) shall be made by the corporation only as authorized
in the specific case upon a determination that indemnification of the
director, officer, employee or agent is proper in the circumstances
because he has met the applicable standard of conduct set forth in
Sections I and 2 of this Article VII. Such determination shall be made
(a) by a majority vote of the directors who were not parties to such
action, suit or proceeding, even though less than a quorum, or (b) if
there are no such directors, or if such directors so direct, by
independent legal counsel in a written opinion, or (c) by the
stockholders.
SECTION 5. Payment of Expenses in Advance of Disposition of Action.
Expenses incurred by an officer or director in defending a civil or
criminal action, suit, or proceeding may be paid by the corporation in
advance of the final disposition of such action, suit, or proceeding as
authorized by the board of directors in the specific case upon receipt
of an undertaking by or on behalf of such director or officer to repay
such amount unless it shall ultimately be determined that he is
entitled to be indemnified by the corporation as authorized in this
Article VII. Such expenses incurred by other employees and agents may
be so paid upon such terms and conditions, if any, as the board of
directors deems appropriate.
SECTION 6. Nonexclusivity of Article. The indemnification provided by
this Article VII shall not be deemed exclusive of any other rights to
which those seeking indemnification may be entitled under any by-law,
agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action
in another capacity while holding such office, and shall continue as to
a person who has ceased to be a director, officer, employee or agent
and shall inure to the benefit of the heirs, executors and
administrators of such a person. The indemnification provided by this
Article VII shall not be exclusive of any powers, rights, agreements or
undertakings which may be legally permissible or authorized by or under
any applicable law but, notwithstanding any other provisions of this
Article VII, the indemnification authorized and provided by this
Article VII shall be applicable only to the extent that such
indemnification shall not duplicate indemnity or reimbursement which
such person has received or shall receive otherwise than under this
Article VII.
II-2
<PAGE>
SECTION 7. Insurance. The corporation may purchase and maintain
insurance on behalf of any person who is or was a director, officer,
employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him and incurred by
him in any such capacity, or arising out of his status as such, whether
or not the corporation would have the power to indemnify him against
such liability under the provisions of this Article VII or otherwise.
SECTION 8. Constituent Corporations. For purposes of this Article VII,
references to "the corporation" shall include, in addition to this
corporation, any constituent corporation (including any constituent of
a constituent) absorbed by this corporation in a consolidation or
merger which, if its separate existence had continued, would have had
power and authority to indemnify its directors, officers, and employees
or agents, so that any person who is or was a director, officer,
employee or agent of such constituent corporation, or is or was serving
at the request of such constituent corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under the
provisions of this Article VII with respect to the resulting or
surviving corporation as he would have with respect to such constituent
corporation if its separate existence had continued.
SECTION 9. Definitions. For purposes of this Article VII, the phrases
"other enterprises," "fines," "serving at the request of the
corporation" and "not opposed to the best interests of the corporation"
shall, in addition to the normal meanings of said phrases, be deemed to
include the meanings ascribed to said phrases in Section 145(i) of the
General Corporation Law of the State of Delaware or any successor
provision thereto.
(b) In addition to the foregoing provisions of the Registrant's
By-laws, directors, officers and controlling persons of the Registrant may be
indemnified by the Registrant pursuant to the provisions of Section 145 of the
Delaware General Corporation Law.
(c) The Registrant maintains officers' and directors' liability
insurance.
Item 16. Exhibits
The following is a list of all exhibits filed as a part of this
Registration Statement, including those which are incorporated herein by
reference.
Exhibit Description
4(c) Specimen Authorization Card
4(d) Letter to Shareholders
5 Opinion of Looper, Reed, Mark & McGraw Incorporated
23(a) Consent of Deloitte & Touche LLP
23(b) Consent of Looper, Reed, Mark & McGraw Incorporated
(included in Exhibit 5)
II-3
<PAGE>
24 Power of Attorney - See Page II-5
Item 17. Undertakings
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement;
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the Prospectus any facts or events
arising after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in this
Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such information in this
Registration Statement;
provided, however, that paragraphs (i) and (ii) above shall not apply if the
information required to be included in a post-effective amendment by such
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in this Registration Statement;
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in this Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-4
<PAGE>
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the undersigned Registrant pursuant to the foregoing provisions, or
otherwise, the undersigned Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Addison, State of Alabama, on December 19, 1996.
CAVALIER HOMES, INC.
By: /s/ David A. Roberson
------------------------------
David A. Roberson
President and Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned Officers and Directors of Cavalier Homes, Inc.,
hereby severally constitute Barry B. Donnell and David A. Roberson, and each of
them singly, our true and lawful attorneys, with full power to them and each of
them to sign for us, and in our names in the capacities indicated below, any and
all registration statements and amendments to registration statements filed with
the Securities and Exchange Commission for the purpose of registering Shares of
Common Stock of Cavalier Homes, Inc. to be issued pursuant to the Cavalier
Homes, Inc. Dividend Reinvestment and Stock Purchase Plan, hereby ratifying and
confirming our signatures as they may be signed by our said attorneys to any and
all said registration statements and amendments to registration statements.
Name Title Date
/s/ Barry B. Donnell Chairman of the Board December 19, 1996
- - ----------------------------- and Director
Barry B. Donnell
/s/ David A. Roberson President, Chief Executive December 19, 1996
- - ----------------------------- Officer and Director
David A. Roberson (Principal executive officer)
/s/ Micheal R. Murphy Secretary-Treasurer and Chief December 19, 1996
- - ----------------------------- Financial Officer
Micheal R. Murphy (Principal financial and
accounting officer)
/s/ Gerald/ W. Moore Director December 19, 1996
- - -----------------------------
Gerald W. Moore
/s/ Thomas A. Broughton, III Director December 19, 1996
- - -----------------------------
Thomas A. Broughton, III
/s/ John W Lowe Director December 19, 1996
- - -----------------------------
John W. Lowe
/s/ Lee Roy Jordan Director December 19, 1996
- - -----------------------------
Lee Roy Jordan
II-6
<PAGE>
EXHIBIT INDEX
Exhibit Description
4(c) Specimen Authorization Card
4(d) Letter to Shareholders
5 Opinion of Looper, Reed, Mark & McGraw Incorporated
23(a) Consent of Deloitte & Touche LLP
23(b) Consent of Looper, Reed, Mark & McGraw Incorporated
(included in Exhibit 5)
24 Power of Attorney - See Page II-5
II-7
EXHIBIT 4(c)
Specimen Authorization Card
CAVALIER HOMES, INC.
Authorization for Dividend Reinvestment and Stock Purchase Plan
To participate in Cavalier Homes, Inc.'s Dividend Reinvestment and Stock
Purchase Plan, all you need to do is complete and sign the reverse side of this
authorization card, and return it in the envelope provided to:
Mellon Securities Trust Company
P. O. Box 750
Pittsburgh, Pennsylvania 15230
This will authorize Cavalier Homes to pay to Mellon Securities Trust Company, as
your agent, all or a portion of the dividends you receive on shares of Cavalier
Homes' Common Stock, to be invested together with any optional cash
contributions you may make in the purchase of additional shares of Cavalier
Homes' Common Stock.
(Please See Reverse Side)
Cavalier Homes, Inc.
Authorization for Dividend Reinvestment and Stock Purchase Plan
Please enroll me in the Cavalier Homes, Inc. Dividend Reinvestment and Stock
Purchase Plan as indicated below:
<TABLE>
<S> <C>
1.|_| Full Dividend Reinvestment 3.|_| Optional Cash Contributions ($500 Minimum/ $40,000
Please apply dividends on all Cavalier Homes, Inc. Maximum per Quarter) Shareholders may participate in
common stock held in my account and any Optional Cash the Optional Cash Contribution feature whether or not
Contributions to the purchase of additional shares of they participate in the Dividend Reinvestment feature
Cavalier Homes, Inc. common stock. for other Cavalier Homes, Inc. shares of common stock
owned by them. Shareholders all of whose shares are
held in nominee or street name may not participate in
the Optional Cash Contribution feature of the Plan.
2.|_| Partial Dividend Reinvestment 4.|_| Safekeeping of Certificates
Please apply dividends on __________ shares of I wish to participate in the Safekeeping service
common stock of Cavalier Homes, Inc. registered in my and I am enclosing certificates representing _______
name and any Optional Cash Contributions to the purchase shares of common stock of Cavalier Homes, Inc. to be
of additional shares of Cavalier Homes, Inc. common stock. deposited with Mellon Securities Trust Company.
ALL PERSONS WHOSE NAMES APPEAR ON THE CERTIFICATE
MUST SIGN.
------------------------------------------
Shareholder's Signature Date
------------------------------------------
Shareholder's Signature Date
</TABLE>
EXHIBIT 4(d)
Form of Letter to Shareholders
December 19, 1996
To our Stockholders:
Cavalier Homes, Inc. announced today the adoption of a Dividend Reinvestment and
Stock Purchase Plan. The Board of Directors has taken this action to allow the
stockholders of the Company to reinvest their dividends in the Company's Common
Stock and to make additional purchases of Common Stock direct from the Company.
The Board feels that this will provide a convenient way for stockholders of the
Company to increase their equity investment without incurring brokerage fees or
commissions. The dividend reinvestment portion of the Plan is open to both
stockholders of record and those who hold their shares in nominee or "street"
(ie., held by a brokerage firm) name. The cash purchase feature of the Plan is
only available to stockholders of record.
Stockholders may invest all or part of their dividends as well as make
additional purchases of Common Stock in amounts of not less than $500 or more
than $40,000 per calendar quarter. The price of shares purchased with reinvested
dividends or additional cash payments will be at 95% of the market price for
such shares at the date invested as defined by the Plan.
The Dividend Reinvestment and Stock Purchase Plan is subject to the filing and
effectiveness of a registration statement with respect to the Common Stock to be
made available under the Plan. The offering of Common Stock pursuant to such
Plan will be made only by means of a prospectus.
To obtain a copy of the prospectus, stockholders should contact Cavalier Homes,
Inc., Attn: Investor Relations, P.O. Box 5003, Wichita Falls, Texas, 76307; or
call (817)723-5523.
By adopting this Dividend Reinvestment and Stock Purchase Plan, the Board of
Directors has expressed its confidence in the continued growth of Cavalier.
Sincerely,
Barry Donnell
Chairman of the Board of Directors
EXHIBIT 5
December 16, 1996
Cavalier Homes, Inc.
Highway 41 North and Cavalier Road
Addison, Alabama 35540
Gentlemen:
We have acted as counsel to Cavalier Homes, Inc. (the "Corporation") in
connection with the Registration Statement of the Corporation on Form S-3 (the
"Registration Statement"), under the Securities Act of 1933, as amended, for the
registration of 200,000 Shares of Common Stock, $.10 par value, of the
Corporation (the "Shares"). The Shares are to be issued under and pursuant to
the provisions of the Corporation's Dividend Reinvestment and Stock Purchase
Plan (the "Plan"). Except as otherwise defined herein, capitalized terms used
herein shall have the same meaning as defined in the Registration Statement.
For purposes of our opinion, we have examined and relied upon:
(a) A copy of the Certificate of Incorporation of the Corporation, as
amended and restated to date (the "Certificate of Incorporation");
(b) A copy of the Bylaws of the Corporation, as amended to date;
(c) A copy of the resolutions adopted by the Board of Directors of the
Corporation at a meeting held on October 23, 1996, authorizing the issuance and
sale of the Shares pursuant to the Plan and related matters; and
(d) The Registration Statement, including the Plan.
Based on the foregoing and subject to the qualifications herein stated,
it is our opinion:
(1) The Corporation has been duly organized and is existing under its
Certificate of Incorporation as an incorporated Delaware corporation and has
made all filings required to be made under Delaware law.
(2) The Shares have been duly authorized and reserved for issuance and,
when issued and paid for in accordance with the Plan, will be validly issued,
fully paid and nonassessable by the Corporation.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement.
Very truly yours,
LOOPER, REED, MARK & MCGRAW
INCORPORATED
By: /s/ Richard B. Goodner
--------------------------
Richard B. Goodner
RBG:mdp
EXHIBIT 23(a)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Cavalier Homes, Inc. on Form S-3 of our report dated March 1, 1996 (March 14,
1996 as to the amendment to the Credit Facility described in Note 5), appearing
in the Annual Report on Form 10-K of Cavalier Homes, Inc. for the year ended
December 31, 1995 and to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.
DELOITTE & TOUCHE LLP
December 19, 1996