8-K

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): January 24, 2005

CHAMPION ENTERPRISES, INC.

(Exact name of registrant as specified in its charter)

Michigan	1-9751	38-2743168
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2701 Cambridge Court, Suite 300
Auburn Hills, Michigan 48326

(Address of principal executive offices)

Registrant’s telephone number, including area code: (248) 340-9090

N/A

(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 140.14a-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

Second Amendment dated January 24, 2005

Item 1.01. Entry Into Material Agreements.

     On January 24, 2005, Champion Enterprises, Inc. entered into the Second Amendment (“The Second Amendment”) to the Loan and Security Agreement dated January 17, 2003 by and among Congress Financial Corporation (Central), as Agent, Wachovia Bank, National Association, as Documentation Agent, the financial institutions from time to time party thereto, as Lenders, and Champion Home Builders Co., as Borrower (“Loan Agreement”.) The Second Amendment amends the definition of “Applicable Margin” in order to reduce the interest rates for Eurodollar Rate Loans and the Letter of Credit Accommodations (as defined in the Loan Agreement.) The Second Amendment is filed as Exhibit 99.1 to this Report and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

     Exhibits.

Exhibit
Number
	99.1	Second Amendment dated January 24, 2005

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.

CHAMPION ENTERPRISES, INC.
 

/s/ Phyllis A. Knight  

Phyllis A. Knight, 

Executive Vice President and
Chief Financial Officer 

Date: January 24, 2005

INDEX TO EXHIBITS

Exhibit No.	Description
99.1	Second Amendment dated January 24, 2005

EX-99.1

Exhibit 99.1

AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of January 24, 2005, is entered into between Champion Home Builders Co., a Michigan corporation (“Borrower”), Congress Financial Corporation (Central), an Illinois corporation, in its capacity as agent for Lenders (in such capacity, “Agent”), and the Lenders listed on the signature pages hereto.

W I T N E S S E T H:

WHEREAS, the parties hereto are parties to that certain Loan and Security Agreement dated as of January 17, 2003 (as amended, modified or supplemented from time to time, “Loan Agreement”) and certain other agreements and documents executed or delivered in connection therewith. Capitalized terms used herein without definition shall have the meanings ascribed to such terms in the Loan Agreement; and

WHEREAS, the parties hereto desire to amend the definition of “Applicable Margin” in the Loan Agreement.

NOW, THEREFORE, in consideration of the premises, the mutual covenants herein contained and other good and valuable consideration (the receipt, adequacy and sufficiency of which are hereby acknowledged), the parties hereto, intending legally to be bound, hereby agree as follows:

1. Amendment to Loan Agreement. The definition of “Applicable Margin” in Section 1 of the Loan Agreement is hereby amended and restated in its entirety to read as follows:

“Applicable Margin” shall mean, at any time, as to the Interest Rate for Prime Rate Loans, Eurodollar Rate Loans and Letter of Credit Accommodations, the applicable row of percentages set forth below if the Gross Excess Availability as of the last Business Day of the immediately preceding fiscal month is at or within the amounts indicated for such row:

		Applicable
	Applicable Margin	Margin for
	for Prime	Eurodollar	Letter of Credit
Gross Excess Availability	Rate Loans	Rate Loans	Accommodations
(a) $70,000,000 or more	0.00%	2.00%	1.75%
(b) Greater than or equal to $35,000,000 and less than $70,000,000	0.25%	2.25%	2.00%
(c) Less than $35,000,000	0.50%	2.50%	2.25%

provided, that, the Applicable Margin shall be calculated and established on the first Business Day following the end of each fiscal month in accordance with the definition of “Interest Rate,” commencing with the first Business Day of June, 2003.

2. Effective Date of this Amendment. This Amendment shall become effective upon the fulfillment of each of the following conditions (including the conditions to the satisfaction of Agent):

          (a) All of Borrower’s representations and warranties contained in the Loan Agreement and any other agreement executed in connection therewith (other than the representations and warranties that are expressly made as of a certain date, which shall be true and correct in all material respects on and as of such date) shall be true and correct in all material respects;

          (b) Agent shall have received from Borrower and the Required Lenders fully executed counterparts to this Amendment signed by duly authorized officers of Borrower and the Required Lenders, respectively, and Agent shall have delivered to Borrower a fully executed counterpart to this Amendment signed by a duly authorized officer of Agent; and

          (c) Agent shall have received from each of the Parent and each Restricted Subsidiary fully executed counterparts to the Acknowledgment and Reaffirmation in the form of Exhibit A attached hereto reaffirming its obligations under each of the Collateral Agreements to which it is a party.

3. Absence of Waiver or Setoff.

3.1. No Waiver. Agent, Required Lenders and Borrower agree that the amendment set forth in Section 1 hereof shall be limited precisely as written and except as expressly set forth in Section 1 of this Amendment, shall not be deemed to be a consent to any waiver or modification of any other term or condition of the Loan Agreement or any Financing Agreements.

3.2. Acknowledgment of Liabilities. Borrower hereby acknowledges and agrees that there is no defense, setoff or counterclaim of any kind, nature or description to the Obligations or the payment thereof when due.

4. Representations. Borrower hereby represents and warrants to Agent and Lenders that:

          (a) Borrower is a corporation duly organized, validly existing, and in good standing under the laws of the state of its incorporation;

          (b) the execution, delivery and performance of this Amendment by Borrower are within its corporate powers and have been duly authorized by all necessary corporate action; and

          (c) this Amendment is a legal, valid, and binding obligation of Borrower, enforceable against Borrower in accordance with its terms.

5. References in Other Documents. References to the Loan Agreement in any Financing Agreement shall be deemed to be a reference to the Loan Agreement as amended hereby, whether or not reference is made to this Amendment.

6. Miscellaneous.

          (a) Section headings used in this Amendment are for convenience of reference only and shall not affect the construction of this Amendment.

          (b) This Amendment may be delivered by facsimile and executed in one or more counterparts and by different parties in separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all of which counterparts taken together shall constitute but one and the same agreement.

          (c) This Amendment shall be a contract made under and governed by the laws of the State of Illinois, without giving effect to principles of conflicts of laws.

          (d) All obligations of Borrower and rights of Agent and Lenders that are expressed herein, shall be in addition to and not in limitation of those provided by applicable law.

          (e) Whenever possible, each provision of this Amendment shall be interpreted in such manner as to be effective and valid under applicable law; but if any provision of this Amendment shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Amendment.

          (f) This Amendment shall be binding upon Borrower, Agent and Lenders and their respective successors and assigns, and shall inure to the benefit of Borrower, Agent and Lenders and the successors and assigns of Borrower, Agent and Lenders.

[NEXT PAGE IS SIGNATURE PAGE]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written.

CHAMPION HOME BUILDERS CO., as Borrower
By:	/s/ JIMMY PAUL
Name: Title:	Jimmy Paul Asst. Treasurer
CONGRESS FINANCIAL CORPORATION
(CENTRAL), as Agent and Lender
By:	/s/ VICKY GEIST
Name: Title:	Vicky Geist Vice President

WELLSFARGO FOOTHILL, INC., as a Lender
By:	/s/ MIKE BARANOWSKI
Name: Title:	Mike Baranowski Vice President

MADELEINE L.L.C, as a Lender
By:	/s/ KEVIN GENDA
Name: Title:	Kevin Genda Senior Vice President

EXHIBIT A

Acknowledgment and Reaffirmation

Each of the undersigned hereby acknowledges receipt of the attached Amendment and consents to the execution and performance thereof by Champion Home Builders Co. Each of the undersigned hereby also reaffirms that its obligations under each of the Collateral Agreements to which it is a party remain in full force and effect and acknowledges and agrees that there is no defense, setoff or counterclaim of any kind, nature or description to the obligations arising under such Collateral Agreements.

EACH PERSON LISTED ON SCHEDULE I ATTACHED HERETO1
By:	/s/ JIMMY PAUL
Name:	Jimmy Paul
Title:	Asst. Treasurer

1 Schedule I to list Parent and each Restricted Subsidiary of Borrower.

Schedule I
A-1 Champion GP, Inc.
A-1 Homes Group, L.P.
Alpine Homes, Inc.
AT Liquidating Corp. (f/k/a American Transport, Inc.)
Art Richter Insurance, Inc.
Builders Credit Corporation
CAC Funding Corporation
Care Free Homes, Inc.
Champion Enterprises, Inc.
Champion Enterprises Management Co.
Champion Financial Corporation
Champion GP, Inc.
Champion Homes of Boaz, Inc. (f/k/a Chandeleur Homes, Inc. and Homes of Legend,
Inc.)
Champion Motor Coach, Inc.
Champion Retail, Inc.
CHI, Inc. (f/k/a Carnival Homes, Inc.)
CRH Liquidating Corp. (f/k/a Crest Ridge Homes, Inc.)
Dutch Housing, Inc.
FHA Liquidating Corp. (f/k/a Factory Homes Outlet, Inc.)
Fleming County Industries, Inc.
Gateway Acceptance Corp.
Genesis Home Centers, Limited Partnership
GM Liquidating Corp. (f/k/a Grand Manor, Inc.)
HH Liquidating L.P. (f/k/a Heartland Homes, L.P.)
HAF Liquidating Corp. (f/k/a Homes America Finance, Inc.)
HAA Liquidating Corp. (f/k/a Homes America of Arizona, Inc.)
HAC Liquidating Corp. (f/k/a Homes America of California, Inc.)
HAO Liquidating Corp. (f/k/a Homes America of Oklahoma, Inc.)
HAU Liquidating Corp. (f/k/a Homes America of Utah, Inc.)
HAW Liquidating Corp. (f/k/a Homes America of Wyoming, Inc.)
Homes of Kentuckiana, L.L.C.
Homes of Merit, Inc.
I.D.A., Incorporated
Iseman Corp.
Lamplighter Homes, Inc.
Lamplighter Homes (Oregon), Inc.
Moduline Industries (Canada), Ltd.
Moduline International, Inc.
Prairie Ridge, Inc.
Redman Homes, Inc.
Redman Industries, Inc.
San Jose Advantage Homes, Inc.
Service Contract Corporation
Southern Showcase Finance, Inc.
Southern Showcase Housing, Inc.
Star Fleet, Inc.
Trading Post Mobile Homes, Inc.
USAMH Liquidating Corp. (f/k/a U.S.A. Mobile Homes, Incorporated)
Victory Investment Co.
Western Homes Corporation
WM Liquidating Corp. (f/k/a Whitworth Management, Inc.)