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Filed Pursuant to Rule 424(b)(3) and 424(c)
Registration No. 333-41319
SUPPLEMENT TO THE JOINT PROXY STATEMENT AND PROSPECTUS
OF CAVALIER HOMES, INC. AND BELMONT HOMES, INC.
DATED DECEMBER 2, 1997
AND REGARDING THE PROPOSED MERGER OF BELMONT HOMES, INC.
WITH A WHOLLY OWNED SUBSIDIARY OF CAVALIER HOMES, INC.
The following information should be inserted at p. 21 of the Joint Proxy
Statement and Prospectus as a new second paragraph under the heading "RISK
FACTORS -- Litigation" and at p. 83 of the Joint Proxy Statement and Prospectus
as a new second paragraph under the heading "CERTAIN INFORMATION CONCERNING THE
BUSINESS OF BELMONT -- Legal Proceedings."
On December 4, 1997, Belmont received notice of a suit filed on December 1,
1997 by three former shareholders (the "Plaintiffs") of Belmont Homes, Inc., an
Alabama corporation which originally owned the initial Belmont manufacturing
facility ("BHIA"), in the Circuit Court of Madison County, Alabama (Case Number
CV 97-2297) against BHIA, Belmont (as a successor in interest of BHIA), certain
other corporate entities (the "Other Corporations"), the Estate of Jerold
Kennedy (the former President and Chief Executive Officer of Belmont), J.M.
Page, and certain other unnamed and unidentified individual officers, employees,
agents and directors of BHIA, Belmont and the Other Corporations, alleging
breach of fiduciary duties, misrepresentation, deceit, suppression and civil
conspiracy. The Plaintiffs state that they owned a majority of the stock in BHIA
and sold such stock in February of 1989. In addition to certain other
allegations, the Plaintiffs claim that Mr. Kennedy, along with others who
allegedly conspired with him, misrepresented and omitted certain facts to them
regarding his attempts to hire a production manager, that Belmont later hired
the production manager, and that the Plaintiffs would not have sold their stock
in BHIA in the absence of these alleged misrepresentations and omissions. In
their complaint, the Plaintiffs request an unspecified amount of compensatory
and punitive damages and/or equitable relief, including a constructive trust.
Belmont is aware that these same plaintiffs have also filed a separate claim
against the Estate of Mr. Kennedy in the Probate Court of Franklin County,
Alabama (Case Number 97-051), alleging essentially the same facts and seeking
substantial compensatory damages and punitive damages and a constructive trust
over the stock in the various Belmont entities owned by Mr. Kennedy's estate.
Belmont believes that the Plaintiffs' claims against it are without merit and
intends to vigorously contest such claims. The outcome of this litigation and
its effect on Belmont cannot presently be determined, however, and the
possibility exists for an adverse resolution of the litigation which could have
a material adverse effect on the results of operations and financial condition
of Belmont, or the combined company following the Merger, in the quarter and
year in which any such adverse resolution occurs.
Date of Supplement: December 10, 1997
