AMENDMENT NO. 1 TO AGREEMENT
AND PLAN OF MERGER BY AND AMONG
CAVALIER HOMES, INC.,
CRIMSON ACQUISITION CORP. AND
BELMONT HOMES, INC.
This Amendment No. 1 to Agreement and Plan of Merger (this
Amendment) is made and entered into as of the 19th day of September, 1997, by
and among Cavalier Homes, Inc., a Delaware corporation (Parent), Crimson
Acquisition Corp., a Mississippi corporation and a wholly owned subsidiary of
Parent (Sub), and Belmont Homes, Inc., a Mississippi corporation (the Company).
W I T N E S S E T H:
WHEREAS, Parent, Sub and the Company entered into an Agreement
and Plan of Merger dated as of August 14, 1997 (the Merger Agreement); and
WHEREAS, Parent, Sub and the Company desire to amend the
Merger Agreement to reflect the intention of the parties to the Merger Agreement
that in order to effect the assumption of the Belmont 1994 Incentive Stock Plan,
as amended (the Belmont Stock Plan), by Parent and the continuing availability
following the Merger (as defined in the Merger Agreement) of the number of
shares reserved for issuance thereunder under Cavalier's 1996 Key Employee Stock
Incentive Plan, as amended (the Cavalier Stock Plan), Parent will use reasonable
efforts to cause the Cavalier Stock Plan to be amended effective upon the
Effective Time of the Merger to provide that shares of Parent Common Stock equal
to the number of shares of Company Common Stock which are reserved for issuance
under the Belmont Stock Plan pursuant to options not yet granted under such plan
as of the Effective Time, plus any number of shares subject to outstanding
options under the Belmont Stock Plan which, pursuant to the express terms of
such options and the plan under which they were granted and not pursuant to any
action by Parent, Sub or the Company not consented to by the applicable
optionee, lapse, expire, terminate or are cancelled after the Effective Time,
will be available for issuance under the Cavalier Stock Plan, with such numbers
in each case being multiplied by the Exchange Ratio;
NOW, THEREFORE, in consideration of the foregoing premises,
and the mutual and dependent covenants and agreements hereinafter set forth, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Parent, Sub, and the Company hereby agree as follows:
1. Capitalized Terms. Capitalized terms used but not
defined herein shall have the respective meanings ascribed to them in the
Merger Agreement.
2. Amendment. The Merger Agreement is hereby amended
by adding the following sentence at the end of Section 2.4(a) of the Merger
Agreement:
Prior to the Effective Time, Parent shall use reasonable
efforts to cause the 1996 Key Employee Stock Incentive Plan of
Cavalier Homes, Inc., as amended (the Cavalier Stock Plan), to
be amended to provide that shares of Parent Common Stock equal
to the number of shares of Company Common Stock which are
reserved for issuance under the Belmont 1994 Incentive Stock
Plan, as amended (the Belmont Stock Plan), pursuant to options
not yet granted under such plan as of the Effective Time, plus
any number of shares subject to outstanding options under the
Belmont Stock Plan which, pursuant to the express terms of
such options and the plan under which they were granted and
not pursuant to any action by Parent, Sub or the Company not
consented to by the applicable optionee, lapse, expire,
terminate, or are cancelled after the Effective Time, will be
available for issuance under the Cavalier Stock Plan, with
such numbers in each case being multiplied by the Exchange
Ratio, and shall use reasonable efforts to take such other and
further action as may be necessary to effectuate the purposes
of the foregoing.
3. No Other Amendment. Except as amended hereby, the
Merger Agreement shall remain in
full force and effect according to its original tenor.
IN WITNESS WHEREOF, Parent, Sub and the Company have executed
and delivered this Amendment No. 1 to the Agreement and Plan of Merger on the
date first written above.
CAVALIER HOMES, INC.
By /s/ Xxxxxxx X. Xxxxxx
Its Chief Financial Officer/Secretary-Treasurer
CRIMSON ACQUISITION CORP.
By /s/ Xxxxxxx X. Xxxxxx
Its Vice President
BELMONT HOMES, INC.
By /s/ X.X. Xxxxx
Its President
