e8vk

Table of Contents

Table of Contents

Table of Contents

Table of Contents

0000950124-04-005052.txt : 20041025 0000950124-04-005052.hdr.sgml : 20041025 20041025161205 ACCESSION NUMBER: 0000950124-04-005052 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20041025 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041025 DATE AS OF CHANGE: 20041025 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CAVCO INDUSTRIES INC CENTRAL INDEX KEY: 0000278166 STANDARD INDUSTRIAL CLASSIFICATION: MOBILE HOMES [2451] IRS NUMBER: 860214910 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-08822 FILM NUMBER: 041094184 BUSINESS ADDRESS: STREET 1: 2728 N HARWOOD CITY: DALLAS STATE: TX ZIP: 75201-1516 BUSINESS PHONE: 2149815000 MAIL ADDRESS: STREET 1: 2728 N HARWOOD CITY: DALLAS STATE: AZ ZIP: 75201-1516 8-K 1 p69757e8vk.htm 8-K e8vk

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 25, 2004

Cavco Industries, Inc.

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation)


000-08822		56-2405642
(Commission File Number)		(IRS Employer Identification No.)

1001 North Central Avenue, Suite 800
Phoenix, Arizona		85004
(Address of principal executive offices)		(Zip Code)

(602) 256-6263
(Registrant’s telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2 (b))

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))

TABLE OF CONTENTS


Item 1.01. Entry Into A Material Definitive Agreement
Item 2.02. Results of Operations and Financial Condition
Item 9.01. Financial Statements and Exhibits
SIGNATURES
EXHIBIT INDEX
EX-10.1 Amendment to Credit Agreement dated as of October 22, 2004
EX-99.1 Press Release
EX-10.1
Ex-99.1

Item 1.01. Entry Into A Material Definitive Agreement

On October 22, 2004, Cavco Industries, Inc., a Delaware corporation (the “Corporation”), entered into an amendment of its credit agreement with Bank One N.A. The amendment to the credit agreement eliminated the borrowing base provision which previously limited the amount of credit available. Under the amendment, the entire $15 million line amount is available. The amendment also eliminated certain covenants which restricted repurchase of the Corporation’s capital stock and payment of dividends and limited capital expenditures. In addition, the covenant requiring the Corporation to meet a defined debt service coverage ratio was replaced with a covenant requiring a defined fixed charge coverage ratio. The amendment also reduces the rate on outstanding borrowings from the London Interbank Offered Rate (“LIBOR”) plus 2.25% to LIBOR plus 1.75% and provides for a lower non-usage fee. A copy of the Corporation’s press release announcing this event is attached as Exhibit 99.1 and the amendment to the credit agreement is attached as Exhibit 10.1.

Item 2.02. Results of Operations and Financial Condition

On October 25, 2004, Cavco Industries, Inc. a Delaware corporation (the “Corporation”), announced its financial results for its fiscal second quarter and six months ended September 30, 2004. A copy of the Corporation’s press release announcing these financial results is attached as Exhibit 99.1 hereto and incorporated by reference

Item 9.01. Financial Statements and Exhibits


Exhibit
Number		Description
10.1		Amendment to Credit Agreement dated as of October 22, 2004

99.1		Press Release dated October 25, 2004

Page 2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 25, 2004

Page 3

EXHIBIT INDEX


Exhibit
Number		Description
10.1		Amendment to Credit Agreement dated as of October 22, 2004

99.1		Press Release dated October 25, 2004

Page 4

EX-10.1 2 p69757exv10w1.htm EX-10.1 exv10w1

Exhibit 10.1

(BANK1ONE LOGO)

Amendment to Credit Agreement

This agreement is dated as of October 22, 2004, by and between Cavco Industries, Inc. (the “Borrower”) and Bank One, NA, with its main office in Chicago, IL (the “Bank”), and its successors and assigns. The provisions of this agreement are effective on the date that this agreement has been executed by all of the signers and delivered to the Bank (the “Effective Date”).

WHEREAS, the Borrower and the Bank entered into a credit agreement dated September 17, 2003, as amended (if applicable) (the “Credit Agreement”); and

WHEREAS, the Borrower has requested and the Bank has agreed to amend the Credit Agreement as set forth below;

NOW, THEREFORE, in mutual consideration of the agreements contained herein and for other good and valuable consideration, the parties agree as follows:

1. DEFINED TERMS. Capitalized terms not defined herein shall have the meaning ascribed in the Credit Agreement.

2. MODIFICATION OF CREDIT AGREEMENT. The Credit Agreement is hereby amended as follows:

2.1 From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports A. is hereby amended as follows: the portion of the provision now reading “Within thirty (30) days after the end of each calendar month in which as of the last day of such month, there is an outstanding advance under Facility A” is hereby replaced with the following:

Within thirty (30) days after the end of each calendar month in which there was an outstanding advance of principal or an outstanding letter of credit under Facility A on the last day of such month in the amount of $5,000,000.00 or greater,

2.2 From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports B. is hereby amended and restated as follows:

B.     A borrowing base certificate, in form and detail satisfactory to the Bank, along with such supporting documentation as the Bank may request, at the following times: (A) within thirty (30) days after and as of the end of each calendar month in which there was an outstanding advance of principal or an outstanding letter of credit under Facility A on the last day of such month in the amount of $5,000,000.00 or greater, and (B) if no borrowing base certificate has been provided or is otherwise due as of the end of the immediately preceding month, with any request of an advance under the Credit Facilities or for the issuance of a letter of credit.

2.3 From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports C. is hereby amended and restated as follows:

C.     Via either the EDGAR System or its Home Page, within ninety (90) days after the filing of its Annual Report on Form 10-K for the fiscal year then ended with the Securities Exchange Commission, the financial statements for such fiscal year as contained in such Annual Report on Form 10-K and, as soon as it shall become available, the annual report to shareholders of the Borrower for the fiscal year then ended.

2.4 From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports D. is hereby amended and restated as follows:

D.     For each fiscal quarter other than the last fiscal quarter of each fiscal year, via either the EDGAR System or its Home Page, within forty-five (45) days after the timely filing of its Quarterly Report on Form

10-Q for the fiscal quarter then ended with the Securities Exchange Commission, copies of financial statements for such fiscal quarter as contained in such Quarterly Report on Form 10-Q.

2.5 From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports E. is hereby amended as follows: the portion of the provision now reading “Via either the EDGAR System or its Home Page, promptly after the same become publicly available,” is hereby replaced with the following:

Via either the EDGAR System or its Home Page, within forty-five (45) days after the same become publicly available,

2.6 From and after the Effective Date, the following provision is hereby added to the Credit Agreement to section 5. Negative Covenants as 5.2 M:

M. Fixed Charge Coverage Ratio. Permit as of each fiscal quarter end, its ratio of net income before taxes, plus amortization, depreciation, interest expense, rent and operating lease payments minus any Distributions and Capital Expenditures, for the twelve month period then ending, to prior period current maturities of long term debt and capital leases, interest expense, taxes, rent and operating lease payments for the same such period, to be less than 1.50 to 1.00.

2.7 From and after the Effective Date, the following provisions are hereby deleted in their entirety from the Credit Agreement: 5.2 A. Dividends; 5.2 K. Capital Expenditures; and 5.2 L. Debt Service Coverage Ratio.

2.8 From and after the Effective Date, the following is hereby added to the Credit Agreement:

5.3 Without the Bank’s consent, the Borrower may:

A. Acquisitions. Purchase or acquire any securities, limited liability company interest or partnership interest (or warrants or other options or rights to acquire the same) of, or make any loans or advances to, any person, firm, limited liability company, partnership or corporation, except for a purchase, acquisition, loan or advance, where (i) the Borrower has provided to the Bank pro forma statements demonstrating to the Bank that such purchase, acquisition, loan or advance will not result in the Borrower being out of compliance with any financial or other covenant contained herein, (ii) such purchase, acquisition, loan or advance does not exceed $5,000,000.00, and (iii) such purchase, acquisition, loan or advance and all other such purchases, acquisitions, loans and advances do not exceed $7,500,000.00 in the aggregate for the then current fiscal year.

3. RATIFICATION. The Borrower ratifies and reaffirms the Credit Agreement and the Credit Agreement shall remain in full force and effect as modified herein.

4. BORROWER REPRESENTATIONS AND WARRANTIES. The Borrower represents and warrants that (a) the representations and warranties contained in the Credit Agreement are true and correct in all material respects as of the date of this agreement, (b) no condition, act or event which could constitute an event of default under the Credit Agreement or any promissory note or credit facility executed in reference to the Credit Agreement exists, and (c) no condition, event, act or omission has occurred, which, with the giving of notice or passage of time, would constitute an event of default under the Credit Agreement or any promissory note or credit facility executed in reference to the Credit Agreement.

5. FEES AND EXPENSES. The Borrower agrees to pay all fees and out-of-pocket disbursements incurred by the Bank in connection with this agreement, including legal fees incurred by the Bank in the preparation, consummation, administration and enforcement of this agreement.

6. EXECUTION AND DELIVERY. This agreement shall become effective only after it is fully executed by the Borrower and the Bank, and the Bank shall have received from the Borrower the following documents: Note Modification Agreement.

7. ACKNOWLEDGEMENTS OF BORROWER. The Borrower acknowledges that as of the date of this agreement it has no offsets with respect to all amounts owed by the Borrower to the Bank arising under or related to the Credit Agreement on or prior to the date of this agreement. The Borrower fully, finally and forever releases and discharges the Bank and its successors, assigns, directors, officers, employees, agents and representatives from any and all claims, causes of action, debts and liabilities, of whatever kind or nature, in law or in equity, of the Borrower, whether now known or unknown to the Borrower, which may have arisen in connection with the Credit Agreement or the actions or omissions of the Bank related to the Credit Agreement on or prior to the date hereof. The Borrower acknowledges and agrees that this agreement is limited to the terms outlined above, and shall not be construed as an agreement to change any other terms or provisions of the Credit Agreement. This agreement shall not establish a course of dealing or be construed as evidence of any willingness on the Bank’s part to grant other or future agreements, should any be requested.

8. NOT A NOVATION. This agreement is a modification only and not a novation. Except for the above-quoted modification(s), the Credit Agreement, any loan agreements, credit agreements, reimbursement agreements, security agreements, mortgages, deeds of trust, pledge agreements, assignments, guaranties, instruments or documents executed in connection with the Credit Agreement, and all the terms and conditions thereof, shall be and remain in full force and effect with the changes herein deemed to be incorporated therein. This agreement is to be considered attached to the Credit Agreement and made a part thereof. This agreement shall not release or affect the liability of any guarantor of any promissory note or credit facility executed in reference to the Credit Agreement or release any owner of collateral granted as security for the Credit Agreement. The validity, priority and enforceability of the Credit Agreement shall not be impaired hereby. To the extent that any provision of this agreement conflicts with any term or condition set forth in the Credit Agreement, or any document executed in conjunction therewith, the provisions of this agreement shall supersede and control. The Bank expressly reserves all rights against all parties to the Credit Agreement.


Borrower:

Cavco Industries, Inc.

By:	/s/ Sean K. Nolen


	Sean K. Nolen	V.P. & CFO

	Printed Name	Title

Date Signed: October 22, 2004

Bank:

Bank One, NA, with its main office in Chicago, IL

By:	/s/ Sanat B. Patel


	Sanat B. Patel	Vice President

	Printed Name	Title

Date Signed: October 22, 2004

Christy Murphy AZ000001011857172
Non-Standard

EX-99.1 3 p69757exv99w1.htm EX-99.1 exv99w1

Exhibit 99.1


		*For additional information, contact:* Joseph Stegmayer Chairman and CEO Phone: 602.256.6263 joes@cavco.com

N e w s R e l e a s e		On the Internet: www.cavco.com

FOR IMMEDIATE RELEASE

CAVCO INDUSTRIES REPORTS SECOND QUARTER RESULTS
Sales increase 25% to $38.6 million
Income from continuing operations up 75% to $2.0 million

PHOENIX, AZ - (October 25, 2004) – Cavco Industries, Inc. (NASDAQ: CVCO) today announced financial results for the second quarter and first six months of fiscal 2005 ended September 30, 2004.

Net sales for the second quarter of fiscal 2005 rose 25% to $38,635,000 from $30,820,000 last year. Net income for the second quarter increased to $2,131,000 compared with $1,133,000 in the same period one year ago.

Net income per share for the second quarter of this year was $0.68 based on basic weighted average shares outstanding and $0.66 per share based on diluted weighted average shares versus $0.36 for the second quarter of last year.

Pre-tax income from continuing operations for the second quarter of the current year was $3,301,000 compared with $1,888,000 for the second quarter of last year. After-tax income from continuing operations increased 75% to $1,981,000 or $0.61 per share versus $1,133,000 or $0.36 per share for last year’s second quarter.

For the first six months of fiscal 2005, net sales climbed 24% to $74,572,000 from $60,335,000 last year. Net income for the first six months of this year increased to $3,838,000 versus $2,075,000 for the comparable prior year period including a proforma tax provision.

Net income per share for the first six months of fiscal 2005 was $1.22 based on basic weighted average shares outstanding and $1.18 per share based on diluted weighted average shares versus $0.67 for the same period in the prior year including a proforma tax provision.

Pre-tax Income from continuing operations was $6,145,000 for the first six months of this year compared with $3,531,000 for the same period last year. After-tax income from continuing operations increased 74% to $3,688,000 or $1.13 per share versus $2,119,000 or $0.68 per share for the same period last year assuming a proforma income tax provision.

Commenting on the results, Joseph Stegmayer, President and Chief Executive Officer, said, “We are pleased to report improved sales and earnings for the quarter. While total industry shipments of new homes continue to be weak across most of the nation, we did benefit from strong demand for homes in the California market. Our products have also been well received in Arizona and surrounding states although industry shipments continue to be very soft throughout the Southwest.”

(more)

Mr. Stegmayer continued, “From a manufacturing standpoint, higher volume and an improved product mix enabled us to increase productivity and efficiency in our plants which had a positive impact on profit margins. Offsetting these efficiencies were the increased raw material prices that we experienced during the quarter. We see no signs of relief from escalating raw material and purchased component prices and remain concerned about the adverse impact such cost increases may have on operating results in the months ahead.”

Cavco also announced that it has amended its revolving credit facility with Bank One N. A. The amendment eliminates the borrowing base requirement which makes available the entire $15 million line.

Addressing Cavco’s financial position, Sean Nolen, Vice President and Chief Financial Officer, said, “Cavco continues to build its financial strength with this quarter’s earnings pushing us above $100 million in stockholders’ equity. Our balance sheet liquidity, positive cash flow and available line of credit give us the financial wherewithal to pursue future growth opportunities that may present themselves.”

Cavco’s senior management will hold a conference call to review these results tomorrow, October 26, 2004, at 1:00 p.m. (Eastern Time). Interested parties can access a live webcast of the conference call on the Internet at http://phx.corporate-ir.net/playerlink.zhtml?c=145386&s=wm&e=956581. An archive of the webcast and presentation will be available for 90 days at this website.

Cavco Industries, Inc., headquartered in Phoenix, is the largest producer of manufactured homes in Arizona, based on wholesale shipments. The company is also a leading producer of park model homes in the United States.

Certain statements contained in this release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. In general, all statements that are not historical in nature are forward-looking. Forward-looking statements are typically included, for example, in discussions regarding the manufactured housing industry; our financial performance and operating results; and the expected effect of certain risks and uncertainties on our business, financial condition and results of operations. All forward-looking statements are subject to risks and uncertainties, many of which are beyond our control. As a result, our actual results or performance may differ materially from anticipated results or performance. Factors that could cause such differences to occur include, but are not limited to, adverse industry conditions, the cyclical nature of our business, limitations on our ability to raise capital, curtailment of available financing in the manufactured housing industry, competition, our ability to maintain relationships with retailers, pricing and availability of raw materials and our lack of recent operating history as an independent public company, together with all of the other risks described in our filings with the Securities and Exchange Commission. Cavco expressly disclaims any obligation to update any forward-looking statements contained in this release whether as a result of new information, future events or otherwise. Investors should not place any reliance on any such forward-looking statements.

(more)

CAVCO INDUSTRIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)


	September 30,			March 31,
	2004			2004
	(Unaudited)
ASSETS
Current assets
Cash	$	35,783		$	30,775
Restricted cash		1,281			827
Accounts receivable		7,201			6,479
Inventories		9,742			7,995
Prepaid expenses and other current assets		1,031			1,701
Deferred income taxes		3,680			3,570
Retail assets held for sale		1,347			2,941

Total current assets		60,065			54,288

Property, plant and equipment, at cost:
Land		2,330			2,330
Buildings and improvements		5,058			5,043
Machinery and equipment		6,334			6,216

		13,722			13,589
Accumulated depreciation		(6,103	)		(5,369	)

		7,619			8,220

Goodwill		67,346			67,346

Total assets	$	135,030		$	129,854

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	5,290		$	6,105
Accrued liabilities		19,934			18,986

Total current liabilities		25,224			25,091

Deferred income taxes		7,910			6,830
Commitments and contingencies
Stockholders’ equity
Preferred Stock, $.01 par value, 1,000,000 shares authorized; No shares issued or outstanding		—			—
Common Stock, $.01 par value; 10,000,000 shares authorized; Outstanding 3,144,365 shares		31			31
Additional paid-in capital		120,030			120,030
Unamortized value of restricted stock		(438	)		(563	)
Accumulated deficit		(17,727	)		(21,565	)

Total stockholders’ equity		101,896			97,933

Total liabilities and stockholders’ equity	$	135,030		$	129,854

(more)

CAVCO INDUSTRIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
(Unaudited)


	Three Months Ended						Six Months Ended
	September 30,						September 30,
	2004			2003			2004			2003
Net sales	$	38,635		$	30,820		$	74,572		$	60,335
Cost of sales		31,366			25,526			61,210			49,740

Gross profit		7,269			5,294			13,362			10,595
Selling, general and administrative expenses		4,068			3,454			7,418			7,139

Income from operations		3,201			1,840			5,944			3,456
Interest income		100			48			201			75

Income from continuing operations before income taxes		3,301			1,888			6,145			3,531
Income tax expense		(1,320	)		(755	)		(2,457	)		(755	)

Income from continuing operations		1,981			1,133			3,688			2,776
Income (loss) from discontinued retail operations less income taxes of $100 in 2004		150			—			150			(73	)

Net Income	$	2,131		$	1,133		$	3,838		$	2,703

Net income per share (basic):
Continuing operations	$	0.63		$	0.36		$	1.17
Discontinued retail operations		0.05			—			0.05

Net Income	$	0.68		$	0.36		$	1.22

Net income per share (diluted):
Continuing operations	$	0.61		$	0.36		$	1.13
Discontinued retail operations		0.05			—			0.05

Net Income	$	0.66		$	0.36		$	1.18

Weighted average shares outstanding:
Basic		3,144,365			3,146,495			3,144,365

Diluted		3,260,264			3,146,495			3,261,089

Proforma financial information:
Income from continuing operations before income taxes										$	3,531
Proforma income tax expense											(1,412	)

Proforma income from continuing operations											2,119
Proforma loss from discontinued operations, net of proforma taxes											(44	)

Proforma net income										$	2,075

Proforma net income (loss) per share — Basic and Diluted:
Continuing operations										$	0.68
Discontinued operations											(0.01	)

Net income										$	0.67

Proforma weighted average shares outstanding — Basic and Diluted											3,118,947

(more)

CAVCO INDUSTRIES, INC. AND SUBSIDIARY
Other Operating Data – Continuing Operations
(Dollars in thousands)


	Three Months Ended						Six Months Ended
	September 30,						September 30,
	2004			2003			2004			2003
Net sales
Manufacturing	$	38,338		$	28,756		$	73,283		$	57,377
Retail		2,204			4,421			4,935			8,450
Less: Intercompany		(1,907	)		(2,357	)		(3,646	)		(5,492	)

Net Sales	$	38,635		$	30,820		$	74,572		$	60,335

Floor shipments - manufacturing		1,730			1,482			3,375			3,001

Average sales price per floor - manufacturing	$	22,161		$	19,404		$	21,713		$	19,119

Home shipments - manufacturing		1,008			850			1,942			1,734

Average sales price per home - manufacturing	$	38,034		$	33,831		$	37,736		$	33,089

Home shipments - retail		33			60			71			112

Average sales price per home - retail	$	66,788		$	73,683		$	69,507		$	75,446

Capital expenditures	$	37		$	118		$	216		$	145

Depreciation	$	272		$	300		$	547		$	604

Explanatory Notes

(1) Effective June 30, 2003, Cavco Industries, LLC (“Cavco LLC”) was merged into Cavco Industries, Inc. (“Cavco Inc.”) and 100% of the outstanding shares of common stock of Cavco Inc. were distributed to the stockholders of Centex Corporation (“Centex”), Cavco LLC’s parent company. Subsequent to this distribution, Cavco Inc. became a separate public company.

(2) Prior to June 30, 2003, Cavco LLC was incorporated into the consolidated Federal income tax returns of Centex. Therefore, income taxes are not provided for prior to June 30, 2003. Proforma income tax expense is calculated assuming a 40% effective tax rate. In anticipation of the distribution described above, proforma tax amounts have been presented on the face of the consolidated statement of operations as if Cavco Inc. was a stand-alone taxable entity for the periods prior to June 30, 2003.

###

GRAPHIC 4 p69757p6975701.gif GRAPHIC begin 644 p69757p6975701.gif M1TE&.#EAV@`E`/<````8>P@8>P@A>Q`A>Q`AA!`IA!@IA!@QA"$QA"$QC"$Y MC"DQC"DYC"E"C#$YC#%"C#%"E#%*E#E"E#E*C#E*E#E2E#EKI4)*E$)2E$)2 MG$):G$)SI4I2G$I:G$ISI4I[I4I[K5):G%):I5)CG%)CI5)KI5)[K5*$K5*$ MM5ICI5IKI5ISI5I[K5J$K5J$M6-CK6-KI6-KK6-SK6.$M6.,M6MSK6MSM6M[ MK6M[M6N,M6N4M6N4O7-[K7-[M7.$M7.,M7.,O7.4O7.Y\[>[];6Y];>Y];>[];G[][>[][G[][G]][O[^?G M[^?G]^?O[^?O]^_O]^_W]^_W__?W]_?W__?____W____________________ M____________________________________________________________ M____________________________________________________________ M____________________________________________________________ M____________________________________________________________ M____________________________________________________________ M____________________________________________________________ M_____________________RP`````V@`E```(_@`Y"1Q(L*#!@P@3*ES(L*'# MAQ`C2IQ(L:+%BQ@S:MS(L:/'CR!#BAQ)LJ3)DRA3CL1$D&5%39L&PG3H,J$F M3C$YW1R8\V9.@SMCWJRID&C"3)B2)LU$L^',@49U_GPJE>#.C8[LK(GSABL; M.%RYKL$3J%+4@Y78=%7[!D\DA)K^;.T:AXNAJP(QS=DJ-H[`38'FBOU3$)/< ML&+'&&(Z4%&?0(/\0);LIQ+"2'AZ<'B0`,$#%50"G178*$[8-6_8'`QL^LT: M.6\Y.5+;FG;7U+>]IG'T,^,8!`P:!&?P8'@#!P<8$.>1:&&F'@(0'&=PX`$> MA(.P$"'V`/__@S8SJ``!X&5&!@HW@`!@BT$*SUQ+SQX=Q7-!^HY\>&# MAQ;]^>>!(P9%0@4%P$U``0454(`<`B_T<181R1$G70!]!`0XH5\`#@7"" M2171#>>`<"B>.-P#!AA`V$:6-/'`@@I24*.-"S*((`*&*!3(C#E2,.,:"/W1 M`9`Y/D!(06DPD.,$#QA!&I`*/J#!BYQ,(F.0"CI@1$V8F&%""SG,0,,,,Y1) M0PZ%_:'!`4$&B0$&%#"`P!.4&'2#!#=><``1!5'"0(T*IC`))Y40P0"=-Q+Z M)(T7@)=1(S`X>8&-EU)PZ045;$H!!@B,D%`EVGE*)P7P'10'!1(T>"FH_E40 M=0..ER)`AT!V&*!I@Q3`T(A`CBBJ8*:MC@'F'$%`<8444#`K!;-0N-$2&\I= M,&RG&'":J8T/4&$)09&0`"2G.1;T!P(+9LH#L"D@F:ZF.69ZZ0,PY+E1("G4 MF&D$4-*([:<(2DK0&D[2:;"-2^`UT!8*&GP!!@V$8-E`^<(KI"(X6='`JT+6 M\&TCPB[8X`0=R*%P1'&@"S"Y4/*KZ:D-4(`E)WU8"W"V%1APW4!E''#J@E0( M9(C-.,=I=`4(&#&Q1GOP>NJ<'63000<BJ(`T7B,J,7")1)I0=+T`0GC=PPZ()T2I`"_I:81&(((XTH8H@C@Q=.N"(U M$4(H$^,GD1PXM=._]]]Y[,+$E[>Z*HPQX-#))(UL<>?,#'>3'"1$V M/GTIE`39_*GSAX@XQJ(`FP`)B$#``AK0!SP8GD8JP;O?"J0"=/+4@#LQ,('W8S,'P1H$13&P+@\K`!##`@%0I8@'#PD#PV-"$N^UO M`CT`CR7TX+T9G&`&_CW\G@EH,)`]J.QG-?@55*XP@4QE@$XOJH0*@+0Y!.TL M$NB:W`12<)-$*4!>$$C522@%0+Q]L`\AP!T#8&"03,A@4;[C0`6:6($'8,`. M!HE#%7_&@!!Q8E8K7!`"[H"K+.;(G.@;`!7:;"6D$`,G:@#`3`%"1&M@Z+:VQBD^G10!!-U()M(0T7DUKP%4P@`$>$`@ M@U@!`;ND@(3@1J<'\.!;%VS7]1Y'K@LPP!!\:-Z'AK:1(7-52&7"";0OJ`($8Z(!. M!O!TIH.25#5""=Z=BH.F,]L(QM`;3D3">@MB8R5N`,["JD")`ME#!]1HA#4P M"@,*,((6:,0!!$'0$(/B6-58-H:%Z,$$8XIO"T[`@@^P22!P"Q*@#I*(*6I+ M2'B,A`HPE;=`0#.`A9@`-VU$`H%$`@8S(JK1+$:!#"`S(XM8`0,"BSI6/:!A MA5T`D3JG@$#:*$,,+-@%(-"!)0UD521$`!?"]:X.C(!+#,`8)]Y@R)R24(8Q MP.Y!YD"#'R2!!D$(@@Z,((06M(%B`"QL/PUBX`C3*$.).-+U.L`)']"153#` M*076)1L9WNQZ.9HC_@55T->-%"($#Q`G!4)@A;YP(<,(.&P98!(@:@0>,^`_CNC2- M3JH@!/@`G1FIV;"$)`.!&5A!CZX3ED9@*:]68`Q^2P07"H8W34?B!@]8:X^\ MFV=K3D`$`QG!4,G9@2<<>*:;18@E,)&)>2=EWI9`K$`Z@+=A31E<534?`V#* M"8:1D`'MQ<2/:ZF@)6&""U8%V`-2,(8X;`4U:MF*8I`J$4Q0\ZK)0S;Y_MSE M`-5PH@R`_=D%'E>"%*3QMV&XH+I/2X)?*4++';11>1$`!?20;H,1"(%;B&!E M,T/0((;HPA64W@4N8,'I7)`"05(091OMMR!SP!$%.,#"-<2$!Q`P,0,*'?!R MXLZK'QF=7-8JP'@03"AE[%0-XYL8=TN:H!!#<(&X#(^19PW@3W%4@1-GRV6!>$ M$#+5%OR:\V!2WN\!L6%>3H&>`@>7[[B:-HDBA$I4#&RA$'\(?A_&,&`;/?H" M"/B5HG)TO(<%MK"(%\@:+._8N,*AFJBVD0.4_HAR.O$;>R[Y-K=/1?>"7"&( MW0/B!TQ>R$\]&DHRZ,,D++&(-XC+?$+**B<*X;Y3A:`F/D8N%.!VBN!57X8! M-[`%5+"`#,B`33`&R'81AK!=ZM4!'*`!&/!$6@*`O#<(`-]!F`Y$(DA$(?F`(DS$( M\AC,0C,)\6D`0_HZP`NMV/Q10:!4Q:=*C*3/2/`TC4!R`!SMQ(`>W!E=A MAIBB*=LT`3V""5<097%H(XTF@A/``%`P,9&`.!;A<47G/".T>!3D2GC@`';D MA*/6B^H4"#5`2LSG%X$@+I,S<$*6!GTB2%*'*'?#;S8R!P4A!U3$*0P0?8UA M!F3P!68`!MW8C5<@+6*C`AN&:JSD0)JB`)=8$SP089L4Q&&0`$#H!P*H!S`82?*D1P/`$XUT`>6000& MX!X/<``',`$!"154$!T/4@"`,FGNH1P"P`5&H0+K`9<((`!*1`7CP2(L`E0$ ML0EIA0!C:2<%``,ZQ@E7\`'P]0$LP`(GX`$?8`%F%`)=B"=5!`%4$`%%T8S1@`%50">2^!VG+`&1)`$SJD%Y8F3 M5V"=T$D%TJE$>N$&9<`&=%`&;L`&;C`'9J"2+>$(6U`#,B0=SG,#9=`(44$( M5)">TTD$<6`4E9`L6@"@2-`$^:$(2W"=U%D%TSF?-FH%3V"C2[`&$U,)?1`' MC7`R#Z$)2H$42$%OF$"D1;I22[$41=&D2!$32'JD9Z&D10HF2#JE"`&E2M$2 M2*&D5LIQ(F()E0!/94H)](805+JD!J$4;NJE3)JG>KJG B?-JG?OJG@!JH@CJH$X1:J(9ZJ(B:J(JZJ(S:J"`1$```.S\_ ` end GRAPHIC 5 p69757p6975700.gif GRAPHIC begin 644 p69757p6975700.gif M1TE&.#EAZ@!+`/<``````(````"``("`````@(``@`"`@,#`P,#/CX^KJZO'Q\?CX^/_[\*"@I("`@/\```#_ M`/__````__\`_P#______RP`````Z@!+```(_@#_"1Q(L*#!@P@3*ES(L*'# MAQ`C2IQ(L:+%BQ@S:MS(L:/'CR!#BAQ)LJ3)DQ_E;="P81[*ES!CRFQ(1X7- MFSASYEQB<]+,GT"#7M1)M*C-)4A7:A#*M*G3IU"C2IU*M:I5D_,RY:0SR>75 MKV`5TJ-3TZA.=P/=F5U[,U/8MT#IL9V+4V!9NDCS+J&SH1[M< MSC.![URB83KUD6.U_A.=.6E2)O.9W,%SYTZ#<;)+Z]&C-\_K=]&TS7:]S[^B M>)U(]?=7+8L4:*"!D0Q43X$)7K34/_:I*1`!^!DVRX8%J8='9(O7H$)U+X@G<$IVQV1.@&T4B MZ*`%[D56>>;QA-1[QFTUU6[;/Q_E//73:% MFN&N!%E+Z#_:&HJBMHM45J9`X"["RZ?%-M0Y4[B+R6HMGG'*J M@`^&9$'Y#R1(TKJMF?%>Y(Z:!,&3X;BA4GDFPO\H#'&Z`U-L("1:P9LB@-`V MQUNH-JDJ48;VU3LQCUL^O`@ML59L<8$.\Y(O3OAVJ!FIAE%K%,A.1J3NR[*V M/'&V09MLL\9*9LBRRBZK!L\&G/F%6\E&-VU0>#NG##2]3)M::M$")7N@$JVB M^>V!)`KMM9$%_Y-Q;RNF3:[66W/=LMH%MJ2<_JYS#]UWBI3)Y@=@^M$CL.\Z+D,PI,XAWT:T7=7K58)?8MGN;B^HO\`PF7GB!D`R4;-=> MIZGZ3LKSQS-=[AI_T_)V;YU0Z6NOC7SW"_W._4`;E(<34I-T[)KY"(G_C]@( M[IZDTG.O6SWTP0^$^\;_^1-3Z($_I,HT$U>MX@)<>5*$L/0N+YS0P`6Q140_-G_#,?#^V&H M02K+(02!AL6">*8KS)K*C]:W!`Y^KWHZS%VM'+7"'0K$S*1"5=^92YZH=8D,B@XB-!/C@;!W=+*9R!C+H06!YJF M0Z:H38FL$B_NX(PU.P*CG$QBG.AZB7;TDJ>]X*PB]"@G<#Z4SHC4XYLC_C*C M4$J3%Z*0Z47>@I(^GX-'%0@P,.X(:)#JR9%YZ.PHEVO*E8AEGERBIR50VP`P M"8G"&D@@AWI!Z61+R+:),Y@*J5HGV M#SFRK'M@FI_I>FHW1^UJIZ#JXE5U*I!$WC%/_Q!1E$0&F&8]M"CO3%)!PJK2 MK=918-DB")AXE"VR@K";A15L]^IXD`#](YQZ4:A--.".]%26LG"YJW8:4L>B M996O,R5(,Q>K6&[AM*=N#2UC;QHM\N`:&[$%6M_2=*LRW05N5AM;UC"WN="-KG2G2UW5!`0``#L_ ` end

CAVCO INDUSTRIES, INC.
(Registrant)

/s/ Sean K. Nolen

Sean K. Nolen

Vice President, Chief Financial Officer,
Treasurer and Secretary

1.		DEFINED TERMS. Capitalized terms not defined herein shall have the meaning ascribed in the Credit Agreement.

2.		MODIFICATION OF CREDIT AGREEMENT. The Credit Agreement is hereby amended as follows:

2.1		From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports A. is hereby amended as follows: the portion of the provision now reading “Within thirty (30) days after the end of each calendar month in which as of the last day of such month, there is an outstanding advance under Facility A” is hereby replaced with the following:

		Within thirty (30) days after the end of each calendar month in which there was an outstanding advance of principal or an outstanding letter of credit under Facility A on the last day of such month in the amount of $5,000,000.00 or greater,

2.2		From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports B. is hereby amended and restated as follows:

		B. A borrowing base certificate, in form and detail satisfactory to the Bank, along with such supporting documentation as the Bank may request, at the following times: (A) within thirty (30) days after and as of the end of each calendar month in which there was an outstanding advance of principal or an outstanding letter of credit under Facility A on the last day of such month in the amount of $5,000,000.00 or greater, and (B) if no borrowing base certificate has been provided or is otherwise due as of the end of the immediately preceding month, with any request of an advance under the Credit Facilities or for the issuance of a letter of credit.

2.3		From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports C. is hereby amended and restated as follows:

		C. Via either the EDGAR System or its Home Page, within ninety (90) days after the filing of its Annual Report on Form 10-K for the fiscal year then ended with the Securities Exchange Commission, the financial statements for such fiscal year as contained in such Annual Report on Form 10-K and, as soon as it shall become available, the annual report to shareholders of the Borrower for the fiscal year then ended.

2.4		From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports D. is hereby amended and restated as follows:

		D. For each fiscal quarter other than the last fiscal quarter of each fiscal year, via either the EDGAR System or its Home Page, within forty-five (45) days after the timely filing of its Quarterly Report on Form

		10-Q for the fiscal quarter then ended with the Securities Exchange Commission, copies of financial statements for such fiscal quarter as contained in such Quarterly Report on Form 10-Q.

2.5		From and after the Effective Date, the provision in the Credit Agreement captioned Financial Reports E. is hereby amended as follows: the portion of the provision now reading “Via either the EDGAR System or its Home Page, promptly after the same become publicly available,” is hereby replaced with the following:

		Via either the EDGAR System or its Home Page, within forty-five (45) days after the same become publicly available,

2.6		From and after the Effective Date, the following provision is hereby added to the Credit Agreement to section 5. Negative Covenants as 5.2 M:

		M. Fixed Charge Coverage Ratio. Permit as of each fiscal quarter end, its ratio of net income before taxes, plus amortization, depreciation, interest expense, rent and operating lease payments minus any Distributions and Capital Expenditures, for the twelve month period then ending, to prior period current maturities of long term debt and capital leases, interest expense, taxes, rent and operating lease payments for the same such period, to be less than 1.50 to 1.00.

2.7		From and after the Effective Date, the following provisions are hereby deleted in their entirety from the Credit Agreement: 5.2 A. Dividends; 5.2 K. Capital Expenditures; and 5.2 L. Debt Service Coverage Ratio.

2.8		From and after the Effective Date, the following is hereby added to the Credit Agreement:

5.3		Without the Bank’s consent, the Borrower may:

A.		Acquisitions. Purchase or acquire any securities, limited liability company interest or partnership interest (or warrants or other options or rights to acquire the same) of, or make any loans or advances to, any person, firm, limited liability company, partnership or corporation, except for a purchase, acquisition, loan or advance, where (i) the Borrower has provided to the Bank pro forma statements demonstrating to the Bank that such purchase, acquisition, loan or advance will not result in the Borrower being out of compliance with any financial or other covenant contained herein, (ii) such purchase, acquisition, loan or advance does not exceed $5,000,000.00, and (iii) such purchase, acquisition, loan or advance and all other such purchases, acquisitions, loans and advances do not exceed $7,500,000.00 in the aggregate for the then current fiscal year.

3.		RATIFICATION. The Borrower ratifies and reaffirms the Credit Agreement and the Credit Agreement shall remain in full force and effect as modified herein.

4.		BORROWER REPRESENTATIONS AND WARRANTIES. The Borrower represents and warrants that (a) the representations and warranties contained in the Credit Agreement are true and correct in all material respects as of the date of this agreement, (b) no condition, act or event which could constitute an event of default under the Credit Agreement or any promissory note or credit facility executed in reference to the Credit Agreement exists, and (c) no condition, event, act or omission has occurred, which, with the giving of notice or passage of time, would constitute an event of default under the Credit Agreement or any promissory note or credit facility executed in reference to the Credit Agreement.

5.		FEES AND EXPENSES. The Borrower agrees to pay all fees and out-of-pocket disbursements incurred by the Bank in connection with this agreement, including legal fees incurred by the Bank in the preparation, consummation, administration and enforcement of this agreement.

6.		EXECUTION AND DELIVERY. This agreement shall become effective only after it is fully executed by the Borrower and the Bank, and the Bank shall have received from the Borrower the following documents: Note Modification Agreement.

7.		ACKNOWLEDGEMENTS OF BORROWER. The Borrower acknowledges that as of the date of this agreement it has no offsets with respect to all amounts owed by the Borrower to the Bank arising under or related to the Credit Agreement on or prior to the date of this agreement. The Borrower fully, finally and forever releases and discharges the Bank and its successors, assigns, directors, officers, employees, agents and representatives from any and all claims, causes of action, debts and liabilities, of whatever kind or nature, in law or in equity, of the Borrower, whether now known or unknown to the Borrower, which may have arisen in connection with the Credit Agreement or the actions or omissions of the Bank related to the Credit Agreement on or prior to the date hereof. The Borrower acknowledges and agrees that this agreement is limited to the terms outlined above, and shall not be construed as an agreement to change any other terms or provisions of the Credit Agreement. This agreement shall not establish a course of dealing or be construed as evidence of any willingness on the Bank’s part to grant other or future agreements, should any be requested.

8.		NOT A NOVATION. This agreement is a modification only and not a novation. Except for the above-quoted modification(s), the Credit Agreement, any loan agreements, credit agreements, reimbursement agreements, security agreements, mortgages, deeds of trust, pledge agreements, assignments, guaranties, instruments or documents executed in connection with the Credit Agreement, and all the terms and conditions thereof, shall be and remain in full force and effect with the changes herein deemed to be incorporated therein. This agreement is to be considered attached to the Credit Agreement and made a part thereof. This agreement shall not release or affect the liability of any guarantor of any promissory note or credit facility executed in reference to the Credit Agreement or release any owner of collateral granted as security for the Credit Agreement. The validity, priority and enforceability of the Credit Agreement shall not be impaired hereby. To the extent that any provision of this agreement conflicts with any term or condition set forth in the Credit Agreement, or any document executed in conjunction therewith, the provisions of this agreement shall supersede and control. The Bank expressly reserves all rights against all parties to the Credit Agreement.

(1)		Effective June 30, 2003, Cavco Industries, LLC (“Cavco LLC”) was merged into Cavco Industries, Inc. (“Cavco Inc.”) and 100% of the outstanding shares of common stock of Cavco Inc. were distributed to the stockholders of Centex Corporation (“Centex”), Cavco LLC’s parent company. Subsequent to this distribution, Cavco Inc. became a separate public company.

(2)		Prior to June 30, 2003, Cavco LLC was incorporated into the consolidated Federal income tax returns of Centex. Therefore, income taxes are not provided for prior to June 30, 2003. Proforma income tax expense is calculated assuming a 40% effective tax rate. In anticipation of the distribution described above, proforma tax amounts have been presented on the face of the consolidated statement of operations as if Cavco Inc. was a stand-alone taxable entity for the periods prior to June 30, 2003.