EXHIBIT 10.3

TAX SHARING AGREEMENT

BY AND AMONG

CENTEX CORPORATION

AND ITS AFFILIATES

AND

CAVCO INDUSTRIES, INC.

Dated                     

     This TAX SHARING AGREEMENT (the “Agreement”) dated as of                      , by and among Centex Corporation (“Centex”), a Nevada corporation and each Centex Affiliate (as defined below), and Cavco Industries, Inc. (“Cavco”), a newly formed Delaware corporation and indirect, wholly owned subsidiary of Centex, is entered into in connection with the Distribution (as defined below).

RECITALS

     WHEREAS, the Centex Board of Directors has determined, subject to certain conditions, that it is appropriate and desirable to make a pro rata distribution of one hundred percent (100%) of the stock of Cavco to its common shareholders, with cash distributed in lieu of any fractional shares of Cavco, on the Distribution Date, as defined below (the “Public Distribution”); and

     WHEREAS, in order to consummate the Public Distribution, it is necessary and desirable for AAA Holdings, Inc. (“AAA”), a Delaware corporation and currently the direct parent of Cavco Industries, LLC (“Cavco LLC”) to form Cavco and to then merge Cavco LLC with and into Cavco (the “Merger”); and

     WHEREAS, in order to consummate the Public Distribution, it is necessary and desirable for AAA to make a pro rata distribution of one hundred percent (100%) of the stock of Cavco to its sole shareholder, Centex Real Estate Corporation (“CREC”) (the “Internal Distribution 1”); and

     WHEREAS, in order to consummate the Public Distribution, it is necessary and desirable for CREC to make a pro rata distribution of one hundred percent (100%) of the stock of Cavco to its sole shareholder, Centex International, Inc. (“International”) (the “Internal Distribution 2”); and

     WHEREAS, in order to consummate the Public Distribution, it is necessary and desirable for International to make a pro rata distribution of one hundred percent (100%) of the stock of Cavco to its sole shareholder, Centex (the “Internal Distribution 3”); and

     WHEREAS, the Merger is intended to qualify as a reorganization under section 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the “Code”), and the Public Distribution and Internal Distributions 1 through 3 (collectively the “Internal Distributions”) are intended to qualify as tax free distributions under Code section 355; and

     WHEREAS, it is appropriate and desirable to set forth the principles and responsibilities of the parties to this Agreement regarding the allocation of Tax (as defined below) and other related liabilities and adjustments with respect to Taxes, Tax contests and other related Tax matters; and

     WHEREAS, to that end, the parties wish to enter into this Tax Sharing Agreement;

AGREEMENT

     NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

ARTICLE 1
DEFINITIONS

     “Audit” includes any audit, assessment of Taxes, other examination by any Tax Authority, proceeding, or appeal of such a proceeding relating to Taxes, whether administrative or judicial.

     “Centex Affiliate” means any corporation or other entity directly or indirectly controlled by Centex, excluding Cavco.

     “Centex Group” means the affiliated group of corporations as defined in Section 1504 (a) of the Code, or similar group of entities as defined under corresponding provisions of the laws of other jurisdictions, of which Centex is the common parent, and any corporation or other entity which may be, may have been or may become a member of such group from time to time, but excluding Cavco.

     “Combined Group” means a group of corporations or other entities that files a Combined Return.

     “Combined Return” means any Tax Return with respect to Non-Federal Taxes filed on a consolidated, combined (including nexus combination, worldwide combination, domestic combination, line of business combination or any other form of combination) or unitary basis wherein Cavco joins in the filing of such Tax Return (for any taxable period or portion thereof) with Centex or one or more Centex Affiliates.

     “Consolidated Group” means an affiliated group of corporations within the meaning of Section 1504 (a) of the Code that files a Consolidated Return.

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     “Consolidated Return” means any Tax Return with respect to Federal Income Taxes filed on a consolidated basis wherein Cavco joins in the filing of such Tax Return (for any taxable period or portion thereof) with Centex or one or more Centex Affiliates.

     “Distribution” means the Internal Distributions and/or the Public Distribution.

     “Distribution Date” means the close of business on the date on which the Public Distribution is effected.

     “Federal Income Tax” means any Tax imposed under Subtitle A of the Code (including the Taxes imposed by Sections 11, 55, 59A, and 1201(a) of the Code), and any interest, additions to Tax or penalties applicable or related thereto, and any other income-based United States federal Tax which is hereinafter imposed upon corporations.

     “Federal Tax” means any Tax imposed or required to be withheld by any Tax Authority of the United States.

     “Final Determination” means any of (a) the final resolution of any Tax (or other matter) for a taxable period, including related interest or penalties, that, under applicable law, is not subject to further appeal, review or modification through proceedings or otherwise, including (1) by the expiration of a statute of limitations or a period for the filing of claims for refunds, amending Tax Returns, appealing from adverse determinations, or recovering any refund (including by offset), (2) by a decision, judgment, decree, or other order by a court of competent jurisdiction, which has become final and unappealable, (3) by a closing agreement or an accepted offer in compromise under Section 7121 or 7122 of the Code, or comparable agreements under laws of other jurisdictions, (4) by execution of an Internal Revenue Service Form 870 or 870AD, or by a comparable form under the laws of other jurisdictions (excluding, however, with respect to a particular Tax Item for a particular taxable period any such form that reserves (whether by its terms or by operation of law) the right of the taxpayer to file a claim for refund and/or the right of the Tax Authority to assert a further deficiency with respect to such Tax Item for such period), or (5) by any allowance of a refund or credit, but only after the expiration of all periods during which such refund or credit may be recovered (including by way of offset), or (b) the payment of Tax by any member of the Consolidated Group or Combined Group with respect to any Tax Item disallowed or adjusted by a Tax Authority provided that Centex determines that no action should be taken to recoup such payment.

     “Income Taxes” means (a) any Tax based upon, measured by, or calculated with respect to (1) net income or profits (including any capital gains Tax, minimum Tax and any Tax on items of Tax preference, but not including sales, use, real or personal property, gross or net receipts, transfer or similar Taxes) or (2) multiple bases if one or more of the bases upon which such Tax may be based, measured by, or calculated with respect to, is described in clause (1) above, or (b) any U.S. state or local franchise Tax.

     “Interest Accrual Period” has the meaning set forth in Section 6.4 of this Agreement.

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     “Non-Federal Combined Tax” means any Non-Federal Tax with respect to which a Combined Return is filed.

     “Non-Federal Separate Tax” means any Non-Federal Tax other than a Non-Federal Combined Tax.

     “Non-Federal Tax” means any Tax other than a Federal Tax.

     “Payment Period” has the meaning set forth in Section 5.3 of this Agreement.

     “Post-Distribution Period” means a taxable period beginning after the Distribution Date.

     “Pre-Distribution Period” means a taxable period beginning on or before the Distribution Date.

     “Privilege” means any privilege that may be asserted under applicable law including, any privilege arising under or relating to the attorney-client relationship (including the attorney-client and work product privileges), the accountant-client privilege, and any privilege relating to internal evaluation processes.

     “Restructuring Tax” means any Tax imposed upon Centex or a Centex Affiliate and reasonable professional fees that are attributable to, or result from, the failure of the Distribution to qualify under Section 355 of the Code (including any Tax attributable to the application of Section 355(e) or Section 355(f) of the Code to the Distribution) or corresponding provisions of the laws of other jurisdictions. Each Tax referred to in the preceding sentence shall be determined using the highest marginal corporate Tax rate for the relevant taxable period (or any portion thereof). For the avoidance of doubt, Restructuring Tax does not include an amount described in this paragraph that is imposed upon a shareholder of Centex in its capacity as a shareholder of Centex.

     “Ruling Documents” means (a) the request for a ruling under Section 355 and various other sections of the Code, filed with the Service on November 5, 2002, together with any supplemental filings or ruling requests or other materials subsequently submitted on behalf of Centex, its subsidiaries and shareholders to the Service, the appendices and exhibits thereto, and any rulings issued by the Service to Centex (or any Centex Affiliate) in connection with the Distribution or (b) any similar filings submitted to, or rulings issued by, any other Tax Authority in connection with the Distribution.

     “Separate Return” means any Tax Return with respect to Non-Federal Separate Taxes filed by Centex, Cavco, or any of their respective affiliates.

     “Service” means the Internal Revenue Service.

     “Tax” means any charges, fees, levies, imposts, duties, or other assessments of a similar nature, including income, alternative or add-on minimum, gross receipts, profits, lease, service, service use, wage, wage withholding, employment, workers compensation, business occupation,

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occupation, premiums, environmental, estimated, excise, employment, sales, use, transfer, license, payroll, franchise, severance, stamp, occupation, windfall profits, withholding, social security, unemployment, disability, ad valorem, estimated, highway use, commercial rent, capital stock, paid up capital, recording, registration, property, real property gains, value added, business license, custom duties, or other tax or governmental fee of any kind whatsoever, imposed or required to be withheld by any Tax Authority including any interest, additions to tax, or penalties applicable or related thereto.

     “Tax Authority” means governmental authority or any subdivision, agency, commission or authority thereof or any quasi-governmental or private body having jurisdiction over the assessment, determination, collection or imposition of any Tax (including the Service).

     “Tax Item” means any item of income, gain, loss, deduction or credit, or other attribute that may have the effect of increasing or decreasing any Tax.

     “Tax Return” means any return, report, certificate, form or similar statement or document (including, any related or supporting information or schedule attached thereto and any information return, amended tax return, claim for refund or declaration of estimated tax) required to be supplied to, or filed with, a Tax Authority in connection with the determination, assessment or collection of any Tax or the administration of any laws, regulations or administrative requirements relating to any Tax.

ARTICLE 2
PREPARATION AND FILING OF TAX RETURNS

2.1 In General.

	(a)		Centex shall have the sole and exclusive responsibility for the preparation and filing of the following Tax Returns: (1) all Consolidated Returns for any Pre-Distribution Period, (2) all Combined Returns for any Pre-Distribution Period, and (3) any Separate Return for any Pre-Distribution Period beginning before and ending on or before the Distribution Date (specifically including, but not limited to, any Texas franchise tax returns for the fiscal year ending March 31, 2003).
	(b)		Except as provided in Section 2.1(a) of this Agreement, Cavco shall have the sole and exclusive responsibility for the preparation and filing of all other Tax Returns for Cavco (or which relate to its businesses, assets or activities) which are required to be filed for any Pre-Distribution Period (including (i) any Pre-Distribution Period beginning before and ending on or before the Distribution Date and (ii) any Pre-Distribution Period beginning before and ending after the Distribution Date) and any Post-Distribution Period.

2.2 Manner of Filing Tax Returns.

(a)

All Tax Returns filed after the date of this Agreement by Centex, any Centex Affiliate, or Cavco shall be

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	(1)		prepared in a manner that is consistent with the Ruling Documents, and
	(2)		filed on a timely basis (including extensions) by the party responsible for such filing under Section 2.1 of this Agreement.

	(b)		Centex and Cavco agree to file all Tax Returns for any Pre-Distribution Period, as provided for in Section 2.1, and to take all other actions in a manner consistent with the position that Cavco is part of any Consolidated Group and any Combined Group for all days through and including the Distribution Date.
	(c)		Except as otherwise provided in this Section 2.2, Centex shall have the exclusive right, in its sole discretion, with respect to any Tax Return described in Section 2.1(a) of this Agreement to determine:

	(1)		the manner in which such Tax Return shall be prepared and filed, including the elections, methods of accounting, positions, conventions and principles of taxation to be used and the manner in which any Tax Item shall be reported;
	(2)		whether any extensions may be requested;
	(3)		the elections that will be made by Centex, any Centex Affiliate, and Cavco in such Tax Return;
	(4)		whether any amended Tax Returns shall be filed;
	(5)		whether any claims for refund shall be made;
	(6)		whether any refunds shall be paid by way of refund or credited against any liability for the related Tax; and
	(7)		whether to retain outside specialists to prepare such Tax Return, whom to retain for such purpose and the scope of any such retainer.

	(d)		In the event that a Tax Item is includable in a Tax Return described in Section 2.1(a) of this Agreement and also in a Tax Return described in Section 2.1(b) of this Agreement that is filed after the date of this Agreement, Cavco preparing, or causing the preparation of, such Tax Return under Section 2.1(b) of this Agreement shall conform the treatment of such Tax Item in such Tax Return described in Section 2.1(b) of this Agreement to the treatment of such Tax Item in the applicable Tax Return described in Section 2.1(a) of this Agreement.
	(e)		Any Tax Return described in (1) Section 2.1(a) of this Agreement (but only with respect to Tax Items of Cavco) or (2) Section 2.1(b) of this Agreement, in either case which Tax Return is filed after the date of this Agreement, shall be prepared on

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a basis consistent with the elections, methods of accounting, positions, conventions and principles of taxation and the manner in which any Tax Item or other information is reported as reflected on the most recently filed Tax Returns involving similar matters. The preceding sentence shall not apply (1) to the extent otherwise required by Section 2.2(a)(1) of this Agreement or (2) if (i) Cavco obtains Centex’s prior written consent (which consent shall not be unreasonably withheld), (ii) there has been a controlling change in law or circumstances, or (iii) the failure to be consistent will not result in an increased Tax liability to, or reduction in a Tax Asset of, Centex or any Centex Affiliate with respect to a Pre-Distribution Period, not fully compensated by Cavco. For purposes of this Section 2.2(e), a controlling change in law or circumstances includes, with respect to Post-Distribution Periods (but not Pre-Distribution Periods), permission to change a method of accounting granted by the relevant Tax Authority.

2.3

Agent. Cavco hereby irrevocably designates Centex as its sole and exclusive agent and attorney-in-fact to take such action (including execution of documents) as Centex, in its sole discretion, may deem appropriate in any and all matters (including Audits) relating to any Tax Return described in Section 2.1(a) of this Agreement.

2.4 Provision of Tax Return Information.

	(a)		Both Cavco and Centex agree to provide all documents and information, and to make available their employees and officers, as may be reasonably requested by either party to prepare any Tax Return described in Section 2.1 of this Agreement.
	(b)		In the case of any Tax Return described in Section 2.1(a) that is filed after the date of this Agreement, Centex shall, upon request of Cavco, provide Cavco a copy of each such Tax Return and all related Tax accounting work papers to the extent that they relate to Cavco.
	(c)		In the case of any Tax Return in Centex’s possession that was filed before the date of this Agreement, Centex shall, upon request of Cavco, provide Cavco a copy of each such Tax Return and all related Tax accounting work papers to the extent that they relate to Cavco.
	(d)		Notwithstanding any other provision of this Agreement, no member of the Centex Group shall be required to provide Cavco access to or copies of:

	(1)		any information that relates to any member of the Centex Group,
	(2)		any information as to which any member of the Centex Group is entitled to assert the protection of any Privilege, or
	(3)		any information as to which any member of the Centex Group is subject to an obligation to maintain the confidentiality of such information.

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	Centex shall use reasonable efforts to separate any such information from any other information to which Cavco is entitled to access or to which Cavco is entitled to copy under this Agreement, to the extent consistent with preserving its rights under this Section 2.4(d).

ARTICLE 3
TAX SHARING AND PAYMENT OF TAXES

3.1		Cavco Liability for Payment of Taxes. Cavco shall pay to the appropriate Tax Authorities all Taxes due and payable for all Pre-Distribution Periods and all Post-Distribution Periods for which it is responsible for filing any Tax Return pursuant to Section 2.1(b). Cavco shall also provide Centex a check made payable to the appropriate Tax Authority for all Taxes due and payable for any Pre-Distribution Period for which Centex is responsible for filing any Separate Return pursuant to Section 2.1(a)(3). Cavco shall deliver such check to Centex within 5 days of Centex’s request for such payment.
3.2		Centex Liability for Payment of Taxes. Except as provided in Section 3.1 (with respect to Cavco’s payment of any Tax that may be due of a Separate Return filed by Centex pursuant to Section 2.1(a)(3)), Centex shall pay to the appropriate Tax Authorities all Taxes due and payable for all Pre-Distribution Periods for which it is responsible for filing any Tax Return pursuant to Section 2.1.
3.3		Additional Liability Allocation. Except with respect to any Restructuring Tax, Cavco shall have no further liability to Centex for any Taxes for any Pre-Distribution Period for which Centex is responsible for filing any Tax Return pursuant to Section 2.1(a)(1) and 2.1(a)(2).

ARTICLE 4
DECONSOLIDATION

4.1 Distribution Related Items.

(a)

Restrictions on Certain Post-Distribution Actions .

(1)

Cavco Restrictions. Cavco covenants to Centex that it will not take or fail to take any action where such action or failure to act would cause the Merger and Distribution to fail to qualify under Sections 355(a) and 368(a)(1)(D) of the Code or any corresponding provisions of state or local law. Without limiting the foregoing, Cavco covenants to Centex that: (i) during the two-year period following the Distribution Date, Cavco will not liquidate, merge or consolidate with any other person; (ii) during the two-year period following the Distribution Date, Cavco will not sell, exchange, or distribute or otherwise dispose of all or a substantial portion of its assets except in the ordinary course of business; (iii) during the two-year period following the Distribution Date, Cavco will continue the active conduct of the historic business as transferred to it in the Merger; (iv) Cavco will not take any action inconsistent with the information and representations in the Ruling

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	Documents; (v) Cavco will not repurchase stock of Cavco in a manner contrary to the requirements of Section 4.05(1)(b) of Revenue Procedure 96-30 or in a manner contrary to the representations made in the Ruling Documents; and (vi) Cavco will not enter into any negotiations, agreements or arrangements with respect to any of the foregoing.

(2)

Centex Restrictions. Centex covenants to Cavco that it will not take or fail to take any action where such action or failure to act would cause the Merger and Distribution to fail to qualify under Sections 355(a) and 368(a)(1)(D) of the Code or any corresponding provisions of state or local law.

(b)

Liability for Undertaking Certain Actions .

	(1)		Cavco Liability. Cavco shall be responsible for one hundred percent (100%) of any Restructuring Taxes that are attributable to, or result from, any act or failure to act described in Section 4.1(a)(1) of this Agreement by Cavco. Cavco shall indemnify Centex, each Centex Affiliate and their directors, officers and employees and hold them harmless from and against any such Restructuring Taxes.
	(2)		Centex Liability. Centex and each Centex Affiliate shall be responsible for one hundred percent (100%) of any Restructuring Taxes that are attributable to, or result from, any act or failure to act described in Section 4.1(a)(2) of this Agreement by Centex or any Centex Affiliate. Centex and each Centex Affiliate shall jointly and severally indemnify Cavco and their directors, officers and employees and hold them harmless from and against any such Restructuring Tax.

	(c)		Information . Centex has provided Cavco with copies of the Ruling Documents submitted on or prior to the date hereof, and shall provide Cavco with copies of any additional Ruling Documents prepared after the date hereof prior to the submission of such Ruling Documents to a Tax Authority.
	(d)		Liability for Breach of Representation . Each of Centex and Cavco hereby represents that (1) it has read the Ruling Documents submitted on or prior to the date hereof, (2) all information contained in such Ruling Documents that concerns or relates to such party or any affiliate of such party, other than information which is provided by an external expert, is true, correct and complete in all material respects, and (3) except to the extent that such party shall have notified the other party in writing to the contrary and with reasonable specificity prior to the Distribution Date, all such information that concerns or relates to such party or any affiliate of such party, other than information which is provided by an external expert, is and will be true, correct and complete in all material respects as of the Distribution Date.

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	Cavco acknowledges and agrees that the term “Ruling Documents,” whenever used in this Agreement, includes all filings or ruling requests or other materials, appendices and exhibits submitted after the date hereof to the Service or any Tax Authority in connection with the Distribution and provided by Centex to Cavco under Section 4.1 of this Agreement.

If any Tax Authority withdraws any portion of a ruling issued to Centex in connection with the Distribution because of a breach by Cavco of a representation made in this Section 4.1, Cavco shall be responsible for one hundred percent (100%) of any Restructuring Taxes. In such event, Cavco shall indemnify Centex, each Centex Affiliate and their directors, officers and employees and hold them harmless from and against any Restructuring Taxes. If any Tax Authority withdraws any portion of a ruling issued to Centex in connection with the Distribution because of a breach by Centex or any Centex Affiliate of a representation made in this Section 4.1, Centex and each Centex Affiliate shall be responsible for one hundred percent (100%) of any Restructuring Taxes. In such event, Centex and each Centex Affiliate shall jointly and severally indemnify Cavco and its directors, officers and employees and hold them harmless from and against any Restructuring Taxes.

(e)

Payment . Cavco shall make or cause to be made all payments for which it may be liable under this Section 4.1. Such payments shall be made to Centex or to the appropriate Tax Authority as specified by Centex no later than five (5) days after delivery by Centex to Cavco of written notice of a payment by or liability of Centex (or a Centex Affiliate or a director, officer or employee) based on a Final Determination, together with a computation of the amounts due.

4.2		Information for Shareholders. Centex shall provide each shareholder that receives stock of Cavco pursuant to the Public Distribution with the information necessary for such shareholder to comply with the requirements of Section 355 of the Code and the Treasury regulations thereunder with respect to statements that such shareholders must file with their Federal Income Tax Returns demonstrating the applicability of Section 355 of the Code to the Public Distribution.
4.3		Special Indemnification. Centex expressly agrees to indemnify Cavco for any Federal Income Tax with respect to any Consolidated Return for which Centex is responsible for filing pursuant to Section 2.1(a)(1) in the event that Cavco is liable to the Service for any such Federal Income Tax pursuant to Treasury Regulation section 1.1502-6.

ARTICLE 5
ADDITIONAL OBLIGATIONS

5.1 Provision of Information.

(a)

Cavco shall furnish to Centex in a timely manner such information and documents as Centex may reasonably request for purposes of (1) preparing any Tax Return for

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	which Centex has filing responsibility under this Agreement, (2) contesting or defending any Audit, and (3) making any determination or computation necessary or appropriate under this Agreement.

	(b)		Cavco shall make its employees available to provide explanations of documents and other materials and such other information as Centex may reasonably request in connection with any of the foregoing.
	(c)		Cavco shall cooperate in any Audit of any Consolidated Return or Combined Return.
	(d)		Cavco shall retain and provide on demand books, records, documentation or other information relating to any Tax Return until the later of (1) the expiration of the applicable statute of limitations (giving effect to any extension, waiver, or mitigation thereof) and (2) in the event any claim is made under this Agreement for which such information is relevant, until a Final Determination with respect to such claim.
	(e)		Cavco shall take such action as Centex may reasonably deem appropriate in connection with the provision of information under this Section 5.1.

5.2 Indemnification.

	(a)		Failure to Pay . Centex and each Centex Affiliate shall jointly and severally indemnify Cavco and its respective directors, officers and employees, and hold them harmless from and against any loss, cost, damage or expense, including reasonable attorneys’ fees and costs, that is attributable to, or results from the failure of Centex, any Centex Affiliate or any director, officer or employee to make any payment required to be made under this Agreement. Cavco shall indemnify Centex, each Centex Affiliate and their respective directors, officers and employees, and hold them harmless from and against any loss, cost, damage or expense, including reasonable attorneys’ fees and costs, that is attributable to, or results from, the failure of Cavco or any director, officer or employee to make any payment required to be made under this Agreement.
	(b)		Inaccurate or Incomplete Information . Centex and each Centex Affiliate shall jointly and severally indemnify Cavco and their respective directors, officers and employees, and hold them harmless from and against any cost, fine, penalty, or other expense of any kind attributable to the negligence of Centex or any Centex Affiliate in supplying Cavco with inaccurate or incomplete information, in connection with the preparation of any Tax Return. Cavco shall indemnify Centex, each Centex Affiliate and their respective directors, officers and employees, and hold them harmless from and against any cost, fine, penalty, or other expenses of any kind attributable to the negligence of Cavco in supplying Centex or any Centex Affiliate with inaccurate or incomplete information, in connection with the preparation of any Tax Return.

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5.3

Interest. Payments pursuant to this Agreement that are not made within the period prescribed in this Agreement or, if no period is prescribed, within thirty (30) days after demand for payment is made (the “Payment Period”) shall bear interest for the period from and including the date immediately following the last date of the Payment Period through and including the date of payment (the “Interest Accrual Period”) at a per annum rate equal to Cavco’s weighted average interest rate for debt capital for each year, or part thereof, included in the Interest Accrual Period plus 50 basis points. Such interest will be payable at the same time as the payment to which it relates and shall be calculated on the basis of a year of 365 days and the actual number of days for which due.

ARTICLE 6
AUDITS

6.1 In General.

	(a)		Centex shall have the exclusive right, in its sole discretion, to control, contest, and represent the interests of Centex, any Centex Affiliate, or Cavco in any Audit relating to any Tax Return described in Section 2.1(a)(1) or 2.1(a)(2) of this Agreement and to resolve, settle or agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Audit.
	(b)		Cavco shall have the exclusive right, in its sole discretion, to control, contest, and represent the interests of Cavco in any Audit relating to any Tax Return described in Section 2.1(b) or Section 2.1(a)(3) of this Agreement and to resolve, settle, or agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Audit.
	(c)		After the Distribution Date, Centex and Cavco shall cooperate in order to transfer to Cavco the exclusive right to control, contest and represent the interests of Cavco in any Audit and to resolve, settle, or agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Audit in each case relating to all Separate Returns of Cavco relating to Non-Federal Separate Taxes.

6.2

Notice. If, after the Distribution Date, Centex or any member of the Centex Group receives written notice of, or relating to, an Audit from a Tax Authority that asserts, proposes or recommends a deficiency, claim or adjustment that, if sustained, would result in any Restructuring Taxes for which Cavco could be responsible under this Agreement, Centex shall notify Cavco in writing of such deficiency, claim or adjustment within ten (10) days of its receipt. If Cavco receives written notice of or relating to an audit from a Tax Authority with respect to a Tax Return described in Section 2.1(a)(1) or 2.1(a)(2) of this Agreement, Cavco shall provide a copy of such notice to Centex within ten (10) days of receiving such notice of such Audit, but in no case later than thirty (30) days before a response is required to be provided to the relevant Tax Authority.

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6.3 Participation Rights.

	(a)		If a Tax Authority asserts, proposes or recommends a deficiency, claim or adjustment that, if sustained, would result in Restructuring Taxes for which Cavco could be responsible under this Agreement, and Cavco acknowledges in writing to Centex that, as between Cavco and Centex, Cavco shall be responsible for one hundred percent (100%) of any such Restructuring Taxes that are determined pursuant to a Final Determination, then (1) Centex shall take all actions requested by Cavco to contest such deficiency, claim or adjustment, including administrative and judicial proceedings; (2) Cavco shall have the right to fully participate with respect to such deficiency, claim or adjustment and related proceedings and Centex shall accept all reasonable suggestions by Cavco in connection with the management and substance of such proceedings, and (3) in no event shall Centex settle or compromise any such deficiency, claim or adjustment without the written consent of Cavco.
	(b)		If a Tax Authority asserts, proposes or recommends a deficiency, claim or adjustment that, if sustained, would result in Restructuring Taxes for which Cavco could be responsible under this Agreement and has not admitted liability for such Restructuring Taxes pursuant to Section 6.3(a):

	(1)		Centex shall keep Cavco informed in a timely manner of all material actions taken or proposed to be taken by Centex in connection with such deficiency, claim or adjustment;
	(2)		Centex shall reasonably consider any comments that Cavco makes with respect to the handling of the case and provide Cavco an opportunity to attend any meetings with the Tax Authority; and
	(3)		Centex shall have no obligation to appeal a determination of any Tax Authority in any judicial forum.

6.4

Failure to Notify, Etc. The failure of Centex promptly to notify Cavco of any matter relating to a particular Tax for a taxable period or to take any action specified in Section 6.3 of this Agreement shall not relieve Cavco of any liability and/or obligation which it may have to Centex or any Centex Affiliate under this Agreement with respect to such Restructuring Taxes except to the extent that Cavco’s rights hereunder are materially prejudiced by such failure and in no event shall such failure relieve Cavco of any other liability and/or obligation which it may have to Centex or any Centex Affiliate.

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ARTICLE 7
DISPUTE RESOLUTION

7.1

Governed by Distribution Agreement. Any dispute arising out of or relating to this Agreement, including the breach or termination hereof, shall be resolved in accordance with the procedures specified in Article 8 of that certain Distribution Agreement between Centex and Cavco dated as of                                                          to which this Agreement is attached as an exhibit.

ARTICLE 8
MISCELLANEOUS

8.1		Effectiveness. This Agreement shall become effective upon execution by both parties hereto.
8.2		Notices. Any notice, request, instruction or other document to be given or delivered under this Agreement by any party to another party shall be in writing and shall be deemed to have been duly given or delivered when (1) delivered in person, (2) sent by facsimile, (3) deposited in the United States mail, postage prepaid and sent certified mail, return receipt requested, or (4) delivered to Federal Express or similar service for overnight delivery to the address of the party set forth below.

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	Any party may, by written notice to the other parties, change the address or the party to which any notice, request, instruction or other document (or any copy thereof) is to be delivered.

8.3		Changes in Law. Any reference to a provision of the Code or a law of another jurisdiction shall include a reference to any applicable successor provision or law.
8.4		Confidentiality. Each party shall hold and cause its directors, officers, employees, advisors and consultants to hold in strict confidence, unless compelled to disclose by judicial or administrative process or, in the opinion of its counsel, by other requirements of law, all information (other than any such information relating solely to the business or affairs of such party) concerning the other parties hereto furnished it by such other party or its representatives pursuant to this Agreement (except to the extent that such information can be shown to have been (1) previously known by the party to which it was furnished, (2) in the public domain through no fault of such party, or (3) later lawfully acquired from other sources not under a duty of confidentiality by the party to which it was furnished), and each party shall not release or disclose such information to any other person, except its directors, officers, employees, auditors, attorneys, financial advisors, bankers and other consultants who shall be advised of and agree to be bound by the provisions of this Section 9.4. Each party shall be deemed to have satisfied its obligation to hold confidential information concerning or supplied by the other party if it exercises the same care as it takes to preserve confidentiality for its own similar information.
8.5		Successors. This Agreement shall be binding on and inure to the benefit of any successor, by merger, acquisition of assets or otherwise, to any of the parties hereto, to the same extent as if such successor had been an original party.
8.6		Affiliates. Centex shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein to be performed by a Centex Affiliate; provided, however, that if a Centex Affiliate ceases to be a Centex Affiliate as a result of a transfer of its stock or other ownership interests to a third party in exchange for consideration in an amount approximately equal to the fair market value of the stock or other ownership interests transferred and such consideration is not distributed outside of the Centex Group to the shareholders of Centex then Cavco shall, upon request, execute a release of such Centex Affiliate from its obligations under this Agreement upon such transfer provided that such Centex Affiliate shall have executed a release of any rights it may have against Cavco or any Cavco Affiliate by reason of this Agreement.
8.7		Authorization, Etc. Each of the parties hereto hereby represents and warrants that it has the power and authority to execute, deliver and perform this Agreement, that this Agreement has been duly authorized by all necessary corporate action on the part of such party, that this Agreement constitutes a legal, valid and binding obligation of each such party and that the execution, delivery and performance of this Agreement by such party does not contravene or conflict with any provision of law or of its charter or bylaws or any agreement, instrument or order binding on such party.

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8.8		Entire Agreement. This Agreement contains the entire agreement among the parties hereto with respect to the subject matter hereof and amends and restates all prior Tax sharing agreements between Centex or any Centex Affiliate and Cavco and such prior tax sharing agreements shall have no further force and effect.
8.9		Section Captions. Section captions used in this Agreement are for convenience and reference only and shall not affect the construction of this Agreement.
8.10		Governing Law. This Agreement shall be governed by and construed in accordance with laws of the State of Texas without giving effect to laws and principles relating to conflicts of law.
8.11		Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement.
8.12		Severability. If any term, provision, covenant, or restriction of this Agreement is held by a court of competent jurisdiction (or an arbitrator or arbitration panel) to be invalid, void, or unenforceable, the remainder of the terms, provisions, covenants, and restrictions set forth herein shall remain in full force and effect, and shall in no way be affected, impaired, or invalidated. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants, and restrictions without including any of such which may be hereafter declared invalid, void, or unenforceable. In the event that any such term, provision, covenant or restriction is held to be invalid, void or unenforceable, the parties hereto shall use their best efforts to find and employ an alternate means to achieve the same or substantially the same result as that contemplated by such terms, provisions, covenant, or restriction.
8.13		No Third Party Beneficiaries. This Agreement is solely for the benefit of Centex, the Centex Affiliates, and Cavco. This Agreement should not be deemed to confer upon third parties any remedy, claim, liability, reimbursement, cause of action or other rights in excess of those existing without this Agreement.
8.14		Waivers, Etc. No failure or delay on the part of the parties in exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, preclude any other or further exercise thereof or the exercise of any other right or power. No modification or waiver of any provision of this Agreement nor consent to any departure by the parties therefrom shall in any event be effective unless the same shall be in writing, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.
8.15		Setoff. All payments to be made by any party under this Agreement shall be made without setoff, counterclaim, or withholding, all of which are expressly waived.

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8.16

Change of Law. If, due to any change in applicable law or regulations or their interpretation by any court of law or other governing body having jurisdiction subsequent to the date of this Agreement, performance of any provision of this Agreement or any transaction contemplated thereby shall become impracticable or impossible, the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such provision.

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed by a duly authorized officer as of the date first above written.

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EXHIBIT 10.4

AGREEMENT TO ASSIGN TRADEMARK RIGHTS
AND LIMITED CONSENT TO USE CENTEX TRADEMARKS

     THIS AGREEMENT (this “Agreement”) is entered into as of                   , 2003 (the “Effective Date”) by and between Centex Corporation, a corporation organized under the laws of the State of Nevada (“Centex”), and Cavco Industries, Inc., a corporation organized under the laws of the State of Delaware (“Cavco”). Centex and Cavco are hereinafter referred to as the “Parties.”

     WHEREAS, the Parties have entered into a Distribution Agreement dated as of                        , 2003 (the “Distribution Agreement”); and

     WHEREAS, as part of the consideration of the Distribution Agreement, Centex desires to assign, and Cavco desires to acquire, all right, title, and interest in and to a number of trademarks that are owned by Centex.

     NOW, THEREFORE, for and in consideration of the mutual covenants contained herein, and for other good and valuable consideration, receipt of which each party hereby acknowledges, the Parties hereby agree as follows:

1. DEFINITIONS

     1.1 “Assigned Marks” means the trademarks listed in Exhibit 1 and all Intellectual Property Rights therein.

     1.2 “Intellectual Property Rights” means copyrights, patents (including patent improvements), patent applications, trade secrets, trademarks, trade names or service marks, pending trademark applications or existing trademark registrations with the United States Patent and Trademark Office, or other intellectual property rights (including common law rights) under applicable law.

2. GRANT OF RIGHTS

     2.1 Centex agrees to assign all of Centex’s right, title and interest in the Assigned Marks to Cavco as set forth in this Agreement. In order to perfect such ownership transfer, contemporaneously with the execution of this Agreement, Centex has executed a separate assignment document to be recorded with the United States Patent and Trademark Office. Centex shall reasonably cooperate with Cavco in the filing and prosecution of the Assigned Marks if necessary.

     2.2 Centex promptly shall deliver to Cavco all documentation pertaining to the Assigned Marks, including copies of all correspondence to or from examining authorities regarding such Assigned Marks, trademark searches pertaining to such Assigned Marks, and all correspondence with any attorney involved in the preparation and/or prosecution of the Assigned Marks.

3. LIMITED CONSENT TO USE CENTEX TRADEMARK

     3.1 As soon as practicable, and in any event within six (6) months after the Effective Date, Cavco, at Cavco’s expense, shall remove any and all exterior and interior signs and identifiers which refer or pertain to Centex. After such period, Cavco shall not use or display the name “Centex” or variations thereof, or other trademarks, tradenames, logos or identifiers using such name or otherwise owned by or licensed to Centex which have not been assigned or licensed to Cavco (collectively, the “Centex Trademarks”), without the prior written consent of Centex. However, nothing contained in this Agreement shall prevent Cavco from using the Centex name in public filings with governmental authorities, materials intended for distribution to Cavco stockholders, or any other communication in any medium which describes the relationship between the Parties.

     3.2 Cavco shall have the right to use existing products, supplies and documents (including, but not limited to, purchase orders, forms, labels, shipping materials, catalogues, sales brochures, operating manuals, instructional documents and similar materials, and advertising material) being transferred to it which have imprinted thereon or otherwise use a Centex Trademark, for a period not to exceed six (6) months following the Effective Date. However, Cavco agrees (i) to use only such supplies and documents existing in inventory as of the Effective Date and (ii) not to order or utilize in any manner any additional supplies and documents which have imprinted thereon or otherwise use a Centex Trademark.

     3.3 Cavco acknowledges and agrees that Centex does not consent to any use of the Centex Trademarks by Cavco other than as provided above, and that no license to use the Centex Trademarks has been granted to Cavco by Centex by this Section 3. The provisions of this Section 3 provide only a limited consent from Centex to Cavco to continue to display the Centex Trademarks on existing signage and other items until the earlier of (i) six months from the date of this Agreement; or (ii) the date Cavco fully complies with the provisions of Section 3.1, and for no other reason.

4. WARRANTIES

     4.1 Centex represents and warrants that: (a) it is a corporation duly organized, validly existing, and in good standing under the laws of the State of Nevada and has full power and authority to enter into this Agreement and perform its obligations hereunder; (b) immediately prior to the execution of this Agreement, Centex owns all right, title and interest in and to the Assigned Marks; and (c) it has the legal right to grant all the rights it purports to grant and to convey all the rights it purports to convey pursuant to Section 2.1 above.

     4.2 Cavco represents and warrants that: (a) it is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and has full power and authority to enter into this Agreement and perform its obligations hereunder.

5. GENERAL

     5.1 Entire Agreement. This Agreement constitutes the entire agreement of the Parties with respect to the subject matter hereof, and to the extent that this agreement is inconsistent with any prior agreement(s) between the Parties, the terms of this agreement are to control.

     5.2 Amendment. This Agreement shall not be amended or otherwise modified except by a written agreement dated subsequent to the date of this Agreement and signed on behalf of Centex and Cavco by their respective duly authorized representatives.

     5.3 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

     5.4 Assignment. This Agreement shall be binding upon and inure to the benefit of the Parties hereto and the Parties’ respective successors and assigns.

     5.5 No Waiver. No waiver of any breach of any provision of this Agreement shall constitute a waiver of any prior, concurrent or subsequent breach of the same or any other provisions hereof, and no waiver shall be effective unless made in writing and signed by an authorized representative of the waiving party.

     5.6 Savings Clause. If any provision of this Agreement shall be held by a court of competent jurisdiction to be illegal, invalid or unenforceable, the remaining provisions shall remain in full force and effect.

     5.7 Further Assurances. The Parties agree to take such further action and execute, deliver and/or file such documents or instruments as are necessary to carry out the terms and purposes of this Agreement.

     5.8 Section Headings. The section headings used in this Agreement are intended for convenience only and shall not be deemed to supersede or modify any provisions.

     IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.

EXHIBIT 1

ASSIGNED MARKS

CAVCO
CAVCO HOMES
SUNBUILT
VILLAGER
SUN VILLA
CEDAR COURT
WESTCOURT
WINROCK
CATALINA
CAVCO GOLD KEY GUARANTEE
SAGUARA
ELITE
DESERT ROSE
SUNBURST
CAVCO CABINS
AAA HOMES
CAVCO HOME CENTER

     EXHIBIT 10.5

EMPLOYMENT AGREEMENT

     This EMPLOYMENT AGREEMENT (“Agreement”) is entered into as                             , 2003 by and between CAVCO INDUSTRIES, INC., a Delaware corporation (the “Company”), and JOSEPH H. STEGMAYER (the “Executive”).

WITNESSETH:

     WHEREAS, the Board of Directors of Centex Corporation (“Centex”) has determined that it would be advisable and in the best interests of Centex for Centex to organize the Company, and to transfer substantially all of the business, operations, assets and liabilities related to Cavco Industries, LLC to the Company; and

     WHEREAS, the Company has agreed to assume substantially all of the business, operations, assets and liabilities related to Cavco Industries, LLC; and

     WHEREAS, the Board of Directors of Centex has also determined that it would be advisable and in the best interests of Centex for Centex to distribute on a pro-rata basis to the holders of record of Centex common stock, par value $0.25 per share (the “Centex Common Stock”), without any consideration being paid by such holders, all of the outstanding shares of the Company’s common stock, par value $.01 per share (the “Cavco Common Stock”), owned by Centex (the “Distribution”); and

     WHEREAS, for United States federal income tax purposes, the Distribution is intended to qualify as a tax-free spin-off within the meaning of Sections 355 and 368(a)(1)(D) of the United States Internal Revenue Code of 1986, as amended (the “Code”); and

     WHEREAS, from and after the date (the “Effective Date”) upon which the Distribution is effectuated, the Company desires to employ the Executive, and the Executive is willing to accept such employment, all upon the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the premises, the terms and provisions set forth herein, the mutual benefits to be gained by the performance thereof and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and subject to the Distribution being effectuated on or before June 30, 2003, the parties hereto agree as follows:

     SECTION 1. Definitions . For purposes of this Agreement, the following definitions shall apply:

	“Average Bonus” shall mean the result obtained by dividing by two the sum of the bonuses, if any, paid to the Executive pursuant to Subsection 5(b) below in

	respect of the two (2) fiscal years next preceding the fiscal year in which the Average Bonus is due. If the employment of the Executive is terminated prior to the conclusion of two (2) fiscal years under the Term of this Agreement, and payment of the Average Bonus is due to Employee, then the amount paid will be $                   .
	“Board” shall mean the Board of Directors of the Company.
	“Breach” shall mean a breach by either the Executive or the Company, as the case may be, of a term of this Agreement which breach remains uncured for 15 days after written notice is received by the party in breach from the party asserting the breach.
	“Change in Control” shall be deemed to have occurred if, subsequent to the Distribution: (i) the Company merges or consolidates with any other corporation (other than a wholly-owned subsidiary) and is not the surviving corporation (or survives only as a subsidiary of another corporation), (ii) the Company sells all or substantially all of its assets to any other person or entity (other than a wholly-owned subsidiary), (iii) the Company is dissolved, or (iv) a third person, including a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, becomes the beneficial owner of shares of Cavco Common Stock having 50% or more of the total number of votes that may be cast for the election of directors of the Company; or as a result of, or in connection with, a contested election for directors, the persons who were directors of the Company before such election shall cease to constitute a majority of the Board of the Company. Notwithstanding any provision of this paragraph, an event, transaction, or corporate action described in this Subsection which would otherwise be deemed a Change in Control, will not be deemed a Change in Control if: it is a management led or supported transaction by persons who were the directors of the Company and persons who were the executive officers of the Company as of six months prior to such event; and if immediately after such event such persons constitute a majority of the directors and constitute a majority of executive officers for, and own in the aggregate at least fifteen percent of the voting securities or interest of, the Company or the surviving or resulting corporation or the parent of the resulting corporation.
	“Common Stock” means the common stock of the Company, par value $.01.
	“Disability” shall mean the Executive’s inability, by reason of a mental or physical impairment, to perform his duties and responsibilities, as set forth in Section 4, below for a period of at least six (6) consecutive months.
	“Termination for Cause” shall mean the Company’s termination of the Executive’s employment pursuant to a determination by the Board, in its sole and absolute discretion, but acting in good faith, that the Executive is guilty of engaging in acts

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	during the Term of this Agreement that constitute theft, dishonesty, fraud, or embezzlement, or that constitute willful and repeated insubordination.
	“Termination Without Cause” shall mean the Company’s termination of the Executive’s employment other than a Termination for Cause. In addition, if the Board alters the Executive’s duties so that he no longer renders such services of an executive and administrative character to the Company as are usual and customary in the case of the chief executive officer of an entity such as the Company, and the Executive thereafter terminates employment with the Company, such termination by the Executive shall be deemed not a voluntary termination of employment by the Executive but a Termination Without Cause.

     All other defined terms set forth in the text of this Agreement will have the meaning assigned to them in this Agreement.

     SECTION 2. Employment . From and after the Effective Date, the Company will employ the Executive upon the terms and conditions set forth herein.

     SECTION 3. Term . Subject to the terms and conditions set forth herein, the Executive shall be employed for a term commencing on the Effective Date and ending on the third anniversary thereof (the “Initial Term”), unless earlier terminated as provided in this Agreement. Thereafter, the term of this Agreement shall automatically be extended for successive one (1) year periods (“Renewal Terms”) unless either the Board or the Executive gives written notice to the other at least ninety (90) days prior to the end of the Initial Term or any Renewal Term, as the case may be, of its or his intention not to renew the term of this Agreement. The Initial Term and any Renewal Terms of this Agreement shall be collectively referred to as the “Term.”

     SECTION 4. Duties and Responsibilities .

     (a)  The Executive shall initially serve in the capacity of Chairman of the Board, President and Chief Executive Officer of the Company, subject to the direction of the Board of Directors of the Company. The Executive’s duties under this Agreement shall consist of the performance of such services as are consistent with the responsibilities of said office and such other services commensurate with his position as a senior executive of the Company as may be assigned to him from time to time by the Board. Such duties shall be performed within the policies and guidelines established from time to time by the Board, subject at all times to the ultimate control and direction of the Board.

     (b)  At all times during the Term, the Executive shall devote substantially all of his business time, attention and energies to the performance of his duties under this Agreement, and shall not undertake or be engaged in any other activities, whether or not pursued for gain, profit or other pecuniary advantage, which could impair his ability to fulfill his duties to the Company under this Agreement, without the prior written consent

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of the Board. Notwithstanding the foregoing, the Company agrees that it shall not be a violation of this paragraph for the Executive to provide services as a part-time employee-consultant to Centex through March 31, 2005.

     (c)  The Executive shall perform his duties under this Agreement with fidelity and loyalty, to the best of his ability, experience and talent and in a manner consistent with his fiduciary responsibilities.

     SECTION 5. Compensation .

     (a)  Base Salary . During the Term, the Company shall pay a salary (the “Base Salary”) of $225,000 per annum to the Executive, payable in accordance with the general payroll practices of the Company in effect from time to time. The Company shall review the Base Salary then being paid to the Executive at such times as the Company regularly reviews the compensation being paid to its executives generally (but no less frequently than once each year). Upon completion of such review, the Company may in its sole discretion adjust the Executive’s then current Base Salary; provided, however, that the Company may not decrease the Executive’s then current Base Salary without the prior written consent of the Executive.

     (b)  Bonus . In addition to the payment of Base Salary, for each fiscal year of the Company during the Term, the Executive shall be awarded a bonus in an amount equal to (i) three percent (3%) of the first $2.5 million of pretax income of the Company, plus (ii) 6% of the pretax income of the Company above $2.5 million (if any). For purposes of this paragraph, the amount of pretax income of the Company for the relevant time periods shall be determined by the Board of Directors of the Company.

     (c)  Stock Options . In connection with the Distribution, the Company has established or will establish a stock incentive plan (the “Plan”). As soon as reasonably practicable following the Effective Date, the Company shall reserve a sufficient number of shares to grant to the Executive the following stock options in accordance with the Plan:

	(i) Initial Grant . As soon as reasonably practicable following the Effective Date, the Company will grant the Executive an initial non-qualified option to purchase a number of shares of Cavco Common Stock equal to 6% of all then issued and outstanding Cavco Common Stock. The Initial Grant shall be subject to pro rata vesting over a three-year period (i.e., 25% on the grant date, with the remainder becoming vested in cumulative 25% increments on each of the first through third anniversaries of the grant date).
	(ii) First Anniversary Grant . As soon as reasonably practicable following the first anniversary of the Distribution, the Company will grant the Executive a non-qualified option to purchase a number of shares of Cavco Common Stock not less than 1% of the then issued and outstanding Cavco

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	Common Stock. The vesting schedule of this option grant will match the vesting schedule of the initial grant.
	(iii) Second Anniversary Grant . As soon as reasonably practicable following the second anniversary of the Distribution, the Company will grant the Executive an additional non-qualified option to purchase a number of shares of Cavco Common Stock not less than 1% of the then issued and outstanding Cavco Common Stock. The vesting schedule of this option grant will match the vesting schedule of the initial grant.

     Each such option grant shall be memorialized in a written agreement. The per share exercise price will be equal to the fair market value of Cavco Common Stock on the date of the grant, as determined in accordance with the Plan. When calculating the number of outstanding shares of Cavco Common Stock for purposes of the Initial, First Anniversary and Second Anniversary Grants, the Restricted Stock awarded to the Executive in accordance with Subsection 5(d) below shall be included in the total number of outstanding shares of Cavco Common Stock.

     (d)  Restricted Stock . As soon as reasonably practicable, the Company shall reserve a sufficient number of shares to grant to the Executive following the Effective Date a number of shares of Cavco Common Stock (the “Restricted Stock”) having a fair market value on the date of the grant equal to the sum of One Million ($1,000,000) Dollars. Upon receipt of the required approval by the Company’s Board, the Executive will receive said grant of Restricted Stock, which shall be reflected in a written agreement. The Restricted Stock shall be ratably released from restriction (or “vested”) over a three-year period (i.e., 25% on the grant date, with the remainder becoming vested in cumulative 25% increments on each of the first through third anniversaries of the grant date). Except as provided herein, vesting of this award is dependent on the Executive’s continued employment with the Company.

     (e)  Expense Reimbursement . During the Term, the Executive shall be entitled to receive prompt reimbursement for all reasonable out-of-pocket expenses incurred in the reasonable discretion of the Executive in connection with the due and proper performance of his duties hereunder in accordance with the Company’s regular practices with respect to other similarly situated executives of the Company.

     (f) Incentive, Savings and Retirement Plans . During the Term, the Executive shall be entitled to participate in all incentive, savings and retirement plans (whether or not qualified under the Code) as amended, established or adopted and maintained by the Company from time to time, in accordance with the Company’s regular practices applicable to other similarly situated executives of the Company. The provisions of this paragraph (f) shall not affect in any way the rights of the Company to amend or terminate any such incentive, savings or retirement plans in accordance with the terms of such plans and the provisions of applicable law.

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     (g)  Group Benefit Plans . During the Term, the Executive shall be entitled to participate in all group benefit plans (including, but not limited to, disability, accident, medical, life insurance and hospitalization plans) established or adopted and maintained by the Company from time to time, in accordance with the Company’s regular practices applicable to other similarly situated executives of the Company. The provisions of this paragraph (g) shall not affect in any way the rights of the Company to amend or terminate any such group benefit plans in accordance with the terms of such plans and the provisions of applicable law.

     (h)  Vacation . The Executive shall be entitled to such vacation, holidays and other paid or unpaid leaves of absence as are consistent with the Company’s normal policies or as are otherwise approved by the Company.

     (i)  Automobile Allowance . The Company will provide the Executive with an automobile allowance consistent with the terms of the Company’s policies as from time to time in effect.

     SECTION 6. Termination and Resignation . The Company shall have the right to terminate the Executive’s employment hereunder at any time and for any reason, and upon any such termination the Executive shall be entitled to receive from the Company prompt payment of the amount determined pursuant to the applicable Subsection of Section 7 below. The Executive shall have the right to terminate his employment hereunder at any time by resignation, and thereupon the Executive will be entitled to receive from the Company prompt payment of the amount determined pursuant to the applicable Subsection of Section 7 below.

     SECTION 7. Payments Upon Termination and Resignation .

     (a)  Pro Rata Payment . If the Company terminates the Executive’s employment for Cause, or if the Executive voluntarily resigns prior to the occurrence of a Change in Control of the Company at a time when there is no uncured Breach by the Company of this Agreement, then in either case the Executive shall be entitled to receive only his then current Base Salary on a pro rata basis to the date of such termination or resignation.

     (b)  Base Salary Payment . If the Executive dies, or becomes Disabled, or if the Company terminates the Executive’s employment Without Cause prior to the occurrence of a Change in Control, or if the Executive resigns because of a Breach by the Company of this Agreement, then in each case the Executive (or his heirs or executors) shall continue to receive his Base Salary for each fiscal year under the remaining Term of this Agreement and the Average Bonus for such year(s), plus an additional year of Base Salary, an Average Bonus and health insurance for such additional year.

     (c)  Multiple Base Salary and Bonus Payment . If within two (2) years after the occurrence of a Change in Control of the Company, (a) the Company terminates the

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Executive’s employment hereunder for any reason other than for Cause, or (b) the Executive voluntarily resigns his employment hereunder for any reason, then in each case the Company will pay to the Executive a lump sum termination payment equal to two times the sum of the Executive’s then current Base Salary and Average Bonus.

     SECTION 8. Confidentiality . The Executive recognizes and acknowledges that the names of the Company’s customers, the Company’s methods of operation, sales, engineering and other trade secrets, as they may exist from time to time, are valuable, special and unique assets of the Company. The Executive shall not, during or after the term of his employment under this Agreement, disclose any such names or other trade secrets, or any part thereof, that he becomes aware of during his employment, to any person, firm, corporation, association or other entity.

     SECTION 9. Competitive Activity .

     (a)  The Executive recognizes and acknowledges that the relationship created by this Agreement is one of trust, and the Executive agrees that, while he is employed by the Company or is being paid under this Agreement following a Termination Without Cause, the Executive shall not (whether acting alone or through any affiliate) or in any other capacity whatsoever and whether by investing in, or holding securities of, any corporation or other entity, advancing or lending any funds to, making available any facilities, equipment or other assets to any entity or other person, engage in any of the following activities:

	(i) except in connection with the due and proper performance of his duties hereunder, engage in the business of designing, manufacturing or selling manufactured housing;
	(ii) except in connection with the due and proper performance of his duties hereunder, solicit or contact (with respect to the manufactured housing industry) retailers, dealers, suppliers, customers or potential customers on behalf of any corporation or other entity or any other person engaged in the business of designing, manufacturing and selling manufactured housing;
	(iii) solicit or otherwise induce any employee of the Company or any of its subsidiaries to terminate his or her service with the Company or any such subsidiary or hire any person who was an employee of the Company or any such subsidiary at any time during the 12-month period immediately prior to the date of termination or expiration of the Executive’s employment hereunder.

     (c) Notwithstanding anything to the contrary in this Section 9, the Company agrees that it shall not be a violation of this Agreement for the Executive to provide services as a part-time employee-consultant to Centex through March 31, 2005.

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     (d)  Notwithstanding anything to the contrary in this Section 9, the Executive may own, for investment purposes only, up to three percent of the stock of any publicly-held corporation that engages in the business of designing, manufacturing and selling manufactured housing or that otherwise directly or indirectly competes with the Company if the stock of such corporation is either listed on a national securities exchange or traded on the NASDAQ National Market and if the Executive is not an employee or consultant of, and is not otherwise affiliated with, such corporation.

     (e)  It is hereby agreed by and between the Executive and the Company that if (notwithstanding the provisions of paragraph (d) below) the non-competition covenants contained in this Agreement should be held by any court or other constituted legal authority to be void or unenforceable in any particular area or jurisdiction, then the parties hereto shall consider this Agreement to be amended and modified so as to eliminate therefrom that particular area or jurisdiction as to which the non-competition covenants are held to be void or otherwise unenforceable, and as to all other areas and jurisdictions covered by this Agreement, the terms and provisions hereof shall remain in full force and effect as originally written.

     (f)  It is further agreed that if the non-competition covenants contained in this Agreement should be held by any court or other constituted legal authority to be effective in any particular area or jurisdiction only if said covenants are modified to limit their duration or scope, then the parties hereto shall consider such non-competition covenants to be amended and modified with respect to that particular area or jurisdiction so as to comply with the order of any court or other constituted legal authority, and as to all other areas and jurisdictions, the non-competition covenants contained herein shall remain in full force and effect as originally written.

     (g)  The Executive and the Company agree that the covenants set forth herein are appropriate and reasonable when considered in light of the nature and extent of the business of designing, manufacturing and selling manufactured housing as conducted by the Company and its subsidiaries. The Executive acknowledges that (i) the Company has a legitimate interest in protecting its business, (ii) the covenants set forth herein are not oppressive to the Executive and contain such reasonable limitations as to time, scope, geographical area and activity, (iii) the covenants do not harm in any manner whatsoever the public interest, and (iv) the Executive has received and will receive substantial consideration for agreeing to such covenants.

     SECTION 10. Miscellaneous .

     (a)  Reimbursement of Legal Expenses . If at any time the Executive (or his beneficiary or beneficiaries, or his estate, as the case may be) shall commence any legal action to enforce any of the terms or provisions of this Agreement, including, without limitation, any term or provision requiring the payment of compensation to the Executive hereunder, whether in installments or in a lump sum, or the payment of the severance benefit hereunder, and such legal action results in a decision favorable to the person so

8

commencing such action, the Company agrees to reimburse such person for all costs and expenses of such action, including reasonable attorney’s fees, incurred by such person in connection therewith.

     (b)  Succession . This Agreement shall inure to the benefit of and be binding upon the Company, its successors and assigns, including without limitation, any person, partnership or corporation which may acquire all or substantially all or a majority of the Company’s assets and business, or with or into which the Company may be consolidated or merged, and this provision shall apply in the event of any subsequent mergers, consolidations, and transfers, and shall be binding upon the Executive, his heirs and personal representatives.

     (c)  No Waiver . The failure of either party to insist, in any one or more instances, upon performance of any of the terms or conditions of this Agreement shall not be construed as a waiver or a relinquishment of any right granted hereunder or of the future performance of any such term or condition, but the obligation of the other party with respect thereto shall continue in full force and effect.

     (d)  Notice . Any notice to be given to the Company hereunder shall be deemed sufficient if addressed to the Company in writing and personally delivered or mailed by certified mail to its office at 1001 N. Central Avenue, 8th Floor, Phoenix, Arizona 85004, Attn: Secretary. Any notice to be given to the Executive hereunder shall be deemed sufficient if addressed to the Executive in writing and personally delivered or mailed by certified mail to 1001 N. Central Avenue, 8th Floor, Phoenix, Arizona 85004. Either party may, by notice as aforesaid, designate a different address or addresses.

     (e)  Severability . In any event any provision of this Agreement shall be held to be illegal, invalid or unenforceable for any reason, the illegality, invalidity, or unenforceability shall not affect the remaining provisions hereof, but such illegal, invalid or unenforceable provision shall be fully severable and this Agreement shall be construed and enforced as if the illegal, invalid or unenforceable provision had never been included herein.

     (f)  Headings . The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof.

     (g)  Word Usage . Words used in the masculine shall apply in the feminine where applicable, and wherever the context of this Agreement dictates, the plural shall be read as the singular and the singular as the plural.

     (h)  Governing Law . This Agreement shall be governed in all respects by the laws of the State of Arizona.

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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

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EXHIBIT 10.6

CAVCO INDUSTRIES, INC. STOCK INCENTIVE PLAN

(Effective June   ,  2003)

1.		Objectives . The Cavco Industries, Inc. Stock Incentive Plan (the “Plan”) is designed to retain selected Directors of Cavco Industries, Inc. and employees of Cavco Industries, Inc. and all subsidiaries, partnerships and affiliates with regard to which Cavco Industries, Inc. owns, directly or indirectly, at least 80% of the ownership interest therein, and reward them for making significant contributions to the success of Cavco Industries, Inc. These objectives are to be accomplished by making awards under the Plan and thereby providing Participants with a financial interest in the growth and performance of the Company. The Plan shall not constitute a “qualified plan” subject to the limitations of Section 401(a) of the Code, nor shall it constitute a “funded plan” for purposes of such requirements. This Plan shall be exempt from the participation, vesting, funding requirements and the fiduciary requirements of the Employee Retirement Income Security Act of 1974 , as amended (“ERISA”).
2.		Definitions . As used herein, the terms set forth below shall have the following respective meanings:

			" Act ” means the Securities Exchange Act of 1934, as amended.
			" Administrator ” means the Compensation Committee of the Board which will be comprised of two or more nonemployee Directors.
			" Affiliate ” means any direct or indirect subsidiary or parent of Cavco Industries and any partnership, joint venture, limited liability company or other business venture or entity in which Cavco Industries owns directly or indirectly at least 80% of the ownership interest in such entity, as determined by the Administrator in its sole and absolute discretion (such determination by the Administrator to be conclusively established by the grant of an Award by the Administrator to an officer or employee of such an entity).
			" Award ” means a Cash Award, Option, Restricted Stock Award, or Restricted Stock Unit Award.
			“Award Agreement” means an agreement between Cavco Industries and a Participant that sets forth the terms, conditions and limitations applicable to an Award.
			" Beneficiary ” means such person or persons, or the trustee of an inter vivos trust for the benefit of natural persons, designated by the Participant in a written election filed with the Administrator as entitled to receive the Participant’s Award(s) in the event of the Participant’s death, or if no such

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election shall have been so filed, or if no designated Beneficiary survives the Participant or can be located by the Administrator, the person or persons entitled thereto under the last will of such deceased Participant, or if such decedent left no will, to the legal heirs of such decedent determined in accordance with the laws of intestate succession of the state of the decedent’s domicile.

			" Board ” means the Board of Directors of Cavco Industries, as the same may be constituted from time to time.
			“Cash Award” means an award denominated in cash.
			" Cavco Industries ” means Cavco Industries, Inc., a Delaware corporation, or any successor thereto.
			“Change in Control” unless otherwise defined by the Committee, means a change in control of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended, whether or not the Cavco Industries is then subject to such reporting requirement; provided, that, without limitation, such a change in control shall be deemed to have occurred if:
			(i) a third person, including a “Group” as defined in Section 13(d)(3) of the Act, becomes the beneficial owner of Shares having fifty (50) percent or more of total number of votes that may be cast for the election of Directors; or
			(ii) as a result of, or in connection with, a contested election for Directors, persons who were Directors immediately before such election shall cease to constitute a majority of the Board.
			" Code ” means the Internal Revenue Code of 1986, as amended.
			" Company ” means each of Cavco Industries, Inc. and its Affiliates.
			“Director” means an individual who is a member of the Board.
			" Disability ” means a disability that entitles the Participant to benefits under the long-term disability plan sponsored or adopted by a Company that covers the Participant.

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			" Employment ” means employment with a Company.
			" Expiration Date ” means, as to an Award, that date which is seven years from the Grant Date of such Award or such other period (not beyond seven years) as the Administrator may determine.
			" Fair Market Value ” means the closing price per Share as of a particular date reported on the consolidated transaction reporting system for The Nasdaq Stock Market, Inc. or, if there shall have been no such sale so reported on that date, on the last preceding date on which such a sale was reported.
			" Grant Date ” means the date an Award is made to a Participant hereunder.
			“Grant Price” means the Fair Market Value on the Grant Date.
			“Option” means a non-qualified Option to purchase one more Shares granted under and pursuant to the Plan. A non-qualified Option does not satisfy the requirements of Section 422 of the Code, or any successor provision.
			" Participant ” means an employee or a nonemployee Director of a Company to whom an Award has been made under this Plan.
			" Payout ” means the issuance or delivery of shares that were the subject of a Restricted Stock Award or Restricted Stock Unit Award without restrictions.
			" Payout Date ” means the date a Award becomes payable pursuant to subsection 7(c)(iii).
			" Plan ” means this Cavco Industries, Inc. Stock Incentive Plan, as set forth herein and as may be amended from time to time.
			" Restricted Stock ” means a right to receive at Payout the number of Shares covered by an Award, subject to the terms of this Plan and the applicable Award Agreement. Restricted Stock does not represent any actual legal or beneficial interest in Cavco Industries.
			“Restricted Stock Award” means an award of Restricted Stock granted to a Participant pursuant to any applicable terms, conditions and limitations as the Administrator may establish in order to fulfill the objectives of the Plan.
			“Restricted Stock Unit” means a unit equal to one Share subject to the terms of the Plan and the applicable Award Agreement.
			“Restricted Stock Unit Award” means an award of Restricted Stock Units

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granted to a Participant pursuant to any applicable terms, conditions and limitations as the Administrator may establish in order to fulfill the objectives of the Plan.

			" Retirement ” means the termination of a Participant’s Employment due to retirement on or after age 62 provided that the Participant has at least ten years of service with one or more Companies.
			" Share ” means a share of Cavco Industries common stock, par value $ .01, and any share or shares of capital stock or other securities of Cavco Industries hereafter issued or issuable upon, in respect of or in substitution or in exchange for each present share. Such shares may be unissued or reacquired shares, as the Board, in its sole and absolute discretion, shall from time to time determine.
			" Termination Date ” means the last date on which the Participant is carried on a Company’s payroll as an employee.

3.		Eligibility . Certain officers, Directors, and key employees of the Company and individuals who have agreed to become employees of the Company and are expected to become such employees within the following six months are eligible for Awards under this Plan, as determined in the sole discretion of the Administrator. The Administrator shall select the Participants in the Plan from time to time as evidenced by the grant of Awards under the Plan.
4.		Plan Administration. The Plan shall be administered by the Administrator, which shall have full and exclusive power to interpret this Plan and to adopt such rules, regulations and guidelines for carrying out this Plan as it may deem necessary or appropriate in its sole discretion. The Administrator shall determine all terms and conditions of the Awards. The Administrator may, in its discretion, provide for the extension of the exercisability of an Option, accelerate the vesting, exercisability, or Payout of an Award, eliminate or make less restrictive any restrictions contained in an Award Agreement, waive any restriction or other provision of this Plan or an Award Agreement or otherwise amend so as to reduce the exercise price thereof, or modify an Award in any manner that is either (i) not adverse to the Participant holding the Award or (ii) consented to by such Participant, provided, however, that except for adjustments described in Section 11, the Grant Price of any Option shall not be amended, and no option may be granted in exchange for a previously granted option if the exercise price of the previously granted option is greater than the exercise price of the replacement option. The Administrator may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any Award in the manner and to the extent the Administrator deems necessary or desirable to further the purposes of the Plan. Any decision of the Administrator in the interpretation and administration of the Plan is final, conclusive and binding on all parties concerned.

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5.		Delegation of Authority . The Administrator may delegate to one or more employees of the Company the performance of non-discretionary functions under this Plan.
6.		Shares Available for Awards . Subject to Section 11 below, the maximum number of Shares that may be awarded under this Plan is 450,000, provided that no more than 200,000 of such Shares will be subject to awards of Restricted Stock or Restricted Stock Units . Shares covered by Options that terminate or are canceled prior to exercise and Shares of Restricted Stock or Shares covered by Restricted Stock Units returned to the Company will again be available for grants of Options, Restricted Stock Awards, and Restricted Stock Unit Awards. Also, if the Option price or any applicable tax withholding obligation payable upon exercise of an Option is satisfied by the tender or withholding of Shares, the number of Shares so tendered or withheld will be eligible for grants of Options, Restricted Stock Awards, and Restricted Stock Unit Awards under this Plan. The Administrator may from time to time adopt and observe such procedures concerning the counting of Shares against the Plan maximum as it may deem appropriate. The Board and the appropriate officers of the Company shall from time to time take whatever actions are necessary to file any required documents with governmental authorities, stock exchanges and transaction reporting systems to ensure that Shares are available for issuance pursuant to Awards.
7.		Awards . The granting of Awards under this Plan shall be entirely discretionary, and nothing in this Plan shall be deemed to give any employee of the Company any right to participate in this Plan or to be granted an Award. Awards shall be granted to Participants at such times and subject to Section 6 above, in such amounts as the Administrator, in its sole and absolute discretion, shall determine.
		(a)   Cash Award. An Award to an officer or key employee of the Company may be in the form of a Cash Award. The terms, conditions and limitations applicable to any Cash Awards granted pursuant to this Plan shall be determined by the Administrator in order to fulfill the objectives of the Plan.
		(b)   Option . An Award to an officer, key employee, or Director of the Company may be in the form of an Option. The Grant Price of an Option shall be not less than 100% of the Fair Market Value of the Shares subject to such Option on the Grant Date. Subject to the foregoing provisions, the terms, conditions and limitations applicable to any Options awarded pursuant to this Plan, including the Grant Price, the term of the Options and the date or dates upon which they become exercisable, shall be determined by the Administrator.

	(i) Option Period. Options will become exercisable at such time or times not more than seven (7) years from the Grant Date as may       be provided by the

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	applicable Award Agreement, subject to the following limits:

			(A) Except as is otherwise provided in the Award Agreement and as provided below in this subsection (A), all rights to exercise an Option shall terminate within four (4) months after the date the optionee ceases to be an employee of the Company, or ceases to be a Director, whichever may occur later, for any reason other than death or Disability (but in no event later than the end of the original period of the Option). In the event of an optionee’s death, an Option will terminate fifteen (15) months thereafter. In the event of an optionee’s Disability and resulting termination of Employment, an Option will terminate six (6) months after such optionee’s Employment Termination Date. However, if an Option is held by a Director who, on the date he or she ceases to be a Director (and, if also an employee, ceases to be an employee), has at least ten (10) years of service as a Director, then all Shares subject to such Option will vest on the date the Director ceases to be a Director, and all rights to exercise such Option will terminate three (3) years thereafter. Also, if an Option is held by a Director who, on the date he or she ceases to be a Director (and, if also an employee, ceases to be an employee), has less than ten (10) years of service as a Director, then all rights to exercise such Options will terminate three (3) months after he or she ceases to be a Director.
			(B) The Administrator may, in its discretion, grant a new Option or amend an outstanding Option to provide an extended period of time during which an optionee can exercise such Option to the maximum permissible exercise period (seven (7) years from the original Grant Date) for which such Option would have been exercisable in the absence of the optionee’s ceasing to be an employee of the Company or ceasing to be a Director. In no case may any Option be exercised later than seven years from the Grant Date. If the Employment of the optionee or the optionee’s service as a Director is terminated for cause, the Option shall thereafter be null and void for all purposes.

	(ii) Payment of Option/Exercise Price . The exercise price of an Option may be paid in cash, by check or wire transfer or, with the       consent of the Administrator, by delivery of Shares, including actual or deemed multiple exchanges of Shares.

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(c)   Restricted Stock Award/Restricted Stock Unit Award . An Award to an officer, key employee, or Director of the Company may be in the form of a Restricted Stock Award or Restricted Stock Unit Award. The term of a Restricted Stock Award or Restricted Stock Unit Award shall run from the Grant Date to the Expiration Date, subject to early Payout or forfeiture as described below. Credit for cash dividends on Restricted Stock or Restricted Stock Unit may be allowed (or accrued) prior to Payout.

			(i) Vesting of Awards.

			(A) Unless different terms are set by the Administrator, a Restricted Stock Award or Restricted Stock Unit Award shall be immediately 25% vested on its Grant Date and shall become vested in cumulative 25% increments on each of the first through third anniversaries of such Grant Date, so that on the third anniversary of the Grant Date the Award will be 100% vested; provided, however, that the Participant must be in continuous Employment from the Grant Date through the date of the applicable anniversary in order for the Restricted Stock Award or Restricted Stock Unit Award to vest.
			(B) A Participant’s Restricted Stock Award or Restricted Stock Unit Award shall be fully vested, irrespective of the limitations set forth in subparagraph (A) above, in the event of (i) a Change in Control, as provided for in Section 8 below, provided that the Participant has been in continuous Employment from the Grant Date until the date of such Change in Control or (ii) Retirement of the Participant.

			(ii) Forfeiture of Restricted Stock Awards or Restricted Stock Unit Awards . Except as otherwise provided in subsection (i) above and the applicable Award Agreement, if a Participant’s Employment is terminated for any reason, the Participant shall forfeit his or her Restricted Stock Award(s) or Restricted Stock Unit Award(s) with respect to any portion that is not vested as of such Participant’s Termination Date and such portion will be transferred at no cost to Cavco Industries unless otherwise determined by the Administrator.
			(iii) Payouts of Restricted Stock Awards and Restricted Stock Unit Awards . Payouts will occur as follows:

			(A) Automatic Payout on Expiration Date . When a Participant’s Restricted Stock Award or Restricted Stock Unit Award has vested, such Award shall have an automatic Payout on the Expiration Date of such Restricted Stock Award or Restricted Stock Unit Award.
			(B) Early Payouts . In addition to automatic Payout on the Expiration Date, there may be an early Payout of the vested portion of an Restricted Stock Award or Restricted Stock Unit Award as follows:

(1) Termination of Employment (whether voluntary or involuntary). The vested portion of each Restricted Stock Award or Restricted Stock Unit Award shall have an automatic Payout on the

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Participant’s Termination Date.

			(2) Death . If a Participant dies prior to the Expiration Date, such Participant’s Restricted Stock Award or Restricted Stock Unit Award , to the extent vested, shall have an automatic Payout as of the date of the Participant’s death and be made to the Participant’s Beneficiary.
			(3) Disability . Prior to the Expiration Date, a Restricted Stock Award or Restricted Stock Unit Award, with the approval of the Administrator, shall both be fully vested and have an automatic Payout on the date selected by the Administrator on or after the date the Participant satisfies the definition of Disability.
			(4) Early Payout Request . A Participant may request that the Administrator consider an early Payout to him or her with respect to any vested portion of a Restricted Stock Award or Restricted Stock Unit Award. The Administrator will consider such request at such time as it deems appropriate and determine in its sole and absolute discretion whether to allow such early Payout, and then notify the Participant of its decision.

			(iv) Form of Payout . As soon as practicable following a determination that Payout of a Participant’s Restricted Stock Award or Restricted Stock Unit Award shall be made as described in paragraph (iii), but not later than five (5) business days after the required Payout Date, Cavco Industries shall make a Payout to the Participant. All Payouts shall be made in Shares except that no fractional Shares will be issued and in lieu thereof cash will be paid to the Participant.
			(v) Delivery of Share Certificates . As promptly as may be practicable following a Payout, Cavco Industries shall make delivery of one or more Share certificates, either by delivery of a physical certificate or an electronic transfer to a broker, for the appropriate number of Shares.

(d) Performance Award. The Administrator may determine that an Award will be subject to restriction until one or more pre-established, objective performance goals established by the Administrator have been achieved. With respect to any such Award, the restrictions will lapse and the Award will vest only upon achievement of the goals. A performance goal may be based on one or more business criteria that apply to the recipient, one or more business units of Cavco Industries or Cavco Industries and its Affiliates as a whole, and may include one or more of the following criteria: operating income, operating margin, earnings before interest, taxes, depreciation and amortization (EBITDA), pre-tax income, net income, net earnings per Share, net earnings per Share

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growth, return on beginning stockholders’ equity, return on average net assets, total Shareholder return relative to other companies in a relevant industry group, debt/capitalization ratio and customer satisfaction. A performance goal need not be based upon an increase or positive result under a particular business criterion but may include, for example, maintaining the status quo or limiting economic losses, as measured by reference to such criterion. Performance goals must be established prior to the earlier to occur of ninety (90) days after the commencement of the period of service to which the goals relate and the lapse of twenty-five (25) percent of the period of service. Prior to the lapse of any applicable restrictions and the vesting of any Award based on the achievement of performance goals, the Administrator must determine that the applicable performance goals were, in fact, satisfied.

(e) Notwithstanding anything contrary contained in this Plan, the following limitations shall apply to any Awards made hereunder:

			(i) No individual may be awarded Options (including Options awarded as Performance Awards) that are exercisable for more than 450,000 Shares in any one-year period;
			(ii) No individual may be awarded a Restricted Stock Award or Restricted Stock Unit Award subject to performance goals designed to comply with Section 162(m) of the Code on more than $1,000,000 in any one-year period (the limitation set forth in this clause (ii), together with the limitation set forth in clause (i) above, being hereinafter referred to as the “Stock Based Awards Limitations”); and
			(iii) No individual may be awarded a Cash Award subject to performance goals designed to comply with Section 162(m) of the Code having a value of more than $1,000,000 in any one-year period.

8.

Change in Control. Notwithstanding the provisions of Section 7 hereof, unless otherwise expressly provided in the applicable Award Agreement, or as otherwise specified in the terms of an Award, in the event of a Change in Control during a Participant’s employment (or service as a nonemployee Director) with the Company or one of its Affiliates, each Award granted under this Plan to the Participant shall become immediately vested and fully exercisable, with performance-based awards vested at target level (regardless of the otherwise applicable vesting or exercise schedules or performance goals provided for under the Award Agreement or the terms of the Award); provided however, that this Section 8 shall not apply with respect to Awards that have expired or been terminated, canceled or forfeited.

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9.		Tax Withholding . Cavco Industries may satisfy withholding obligations with respect to any Award or Payout by retaining at the time of Award or Payout, as appropriate, a number of Shares, based on the Fair Market Value on such date, for payment of taxes required by law.
10.		Non-Assignability . Unless otherwise determined by the Administrator and provided in the applicable Award Agreement, no Award or Payout or any other benefit under this Plan shall be assignable or otherwise transferable except to a Beneficiary or by will, the laws of descent and distribution or a domestic relations order, and during the lifetime of the optionee the Option may be exercised only by the optionee or the optionee’s guardian or legal representative. The Administrator may prescribe other restrictions on transfer. Any attempted assignment of an Award or any other benefit under this Plan in violation of this Section 11 shall be null and void.

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11.		Changes in Shares and Certain Corporate Transactions.
		(a) The existence of outstanding Awards shall not affect in any manner the right or power of Cavco Industries or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the capital stock of Cavco Industries or its business or any merger or consolidation of Cavco Industries, or any issue of bonds, debentures, preferred or prior preference stock (whether or not such issue is prior to, on a parity with or junior to the existing Shares) or the dissolution or liquidation of Cavco Industries, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding of any kind, whether or not of a character similar to that of the acts or proceedings enumerated above.
		(b) In the event of any subdivision or consolidation of outstanding Shares, declaration of a dividend payable in Shares or other stock split, then (i) the number of Shares reserved under this Plan, (ii) the number of Shares covered by outstanding Awards, (iii) the Grant Price or other price in respect of such Awards, (iv) the appropriate Fair Market Value and other price determinations for such Awards, and (v) the Stock Based Awards Limitations shall each be proportionately adjusted by the Board as appropriate to reflect such transaction. In the event of any other recapitalization or capital reorganization of Cavco Industries, any consolidation or merger of Cavco Industries with another corporation or entity, the adoption by Cavco Industries of any plan of exchange affecting Shares or any distribution to holders of Shares of securities or property (other than normal cash dividends or dividends payable in Shares), the Board shall make appropriate adjustments to (x) the number of Shares reserved under this Plan and (y)(i) the number of Shares covered by Awards, (ii) the Grant Price or other price in respect of such Awards, (iii) the appropriate Fair Market Value and other price determinations for such Awards, and (iv) the Stock Based Awards Limitations to reflect such transaction; provided that such adjustments shall only be such as are necessary to maintain the proportionate interest of the holders of the Awards and preserve, without increasing, the value of such Awards. In the event of a merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation, the Administrator shall be authorized (x) to issue new Awards in substitution for previously issued compensatory awards, including Awards, as deemed appropriate by the Board or (y) to reflect the assumption of, any other compensatory award (including Awards), whether or not awarded under the Plan.
12.		Requirements of Law . Notwithstanding anything herein to the contrary, Cavco Industries shall not be required to issue Shares under any Restricted Stock Award or Restricted Stock Unit Award if the issuance thereof would constitute a violation by the Participant or Cavco Industries of any provisions of any law or regulation of any governmental authority or any national securities exchange, automated quotation system or other self regulated organization, and as a condition of any issuance of Shares under any Restricted Stock Award or Restricted Stock Unit Award, Cavco Industries may require such agreements or undertakings, if any, as Cavco Industries may

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deem necessary or advisable to ensure compliance with any such law or regulation.

13.		Amendment, Suspension or Termination . The Board may amend, suspend or terminate this Plan for the purpose of meeting or addressing any changes in legal requirements or for any other purpose permitted by law, except that (i) no amendment or alteration that would adversely affect the rights of any Participant under any Award previously granted to such Participant shall be made without the consent of such Participant, (ii) no amendment or alteration shall be effective prior to its approval by the stockholders of Cavco Industries to the extent such approval is required by applicable legal requirements or the requirements of the securities exchange on which Cavco Industries’s stock is listed or automated quotation system or other self regulated organization to which such stock is admitted for trading and (iii) after the Plan has been approved by the stockholders of Cavco Industries, the Board may not, except pursuant to Section 12 hereof, amend the Plan to increase the maximum number of Shares subject hereto or decrease the option Price below 100% of the fair market value at the time of grant.
14.		Unfunded Plan . This Plan shall be unfunded. Although bookkeeping accounts may be established with respect to Participants representing Awards, any such accounts shall be used merely as a bookkeeping convenience. Cavco Industries shall not be required to segregate any assets that may at any time be represented by Awards, nor shall this Plan be construed as providing for such segregation, nor shall Cavco Industries, the Board or the Administrator be deemed to be a trustee of any Awards to be granted under this Plan. Any liability or obligation of Cavco Industries to any Participant with respect to a grant of Awards under this Plan shall be based solely upon any contractual obligations that may be created under this Plan, and no such liability or obligation of Cavco Industries shall be deemed to be secured by any pledge or other encumbrance on any property of Cavco Industries. None of Cavco Industries or any other Company, the Board or the Administrator shall be required to give any security or bond for the performance of any obligation that may be created by this Plan.
		Notwithstanding the foregoing, upon the occurrence of a Change in Control, each Company whose employees are Participants shall, as soon as possible, but in no event longer than 15 days following the Change in Control, make an irrevocable contribution to a trust established by Cavco Industries in an amount sufficient to fully pay the entire benefit to which each Participant employed by such company would be entitled pursuant to the terms of this Plan as of the date on which such Change in Control occurs. In its sole discretion, Cavco Industries may establish such a trust at any time prior to a Change in Control and may make contributions to such trust in Shares or in cash which would be used to acquire Shares to transfer to Participant. Any such trust shall be designed to assist Cavco Industries in satisfying its obligations under this Plan; but it shall remain subject to the claims of its creditors.

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     EXHIBIT 10.7

EMPLOYMENT AGREEMENT

     This EMPLOYMENT AGREEMENT (“Agreement”) is entered into as of                      , 2003 by and between CAVCO INDUSTRIES, INC., a Delaware corporation (the “Company”), and SEAN K. NOLEN (the “Executive”).

WITNESSETH:

     WHEREAS, the Board of Directors of Centex Corporation (“Centex”) has determined that it would be advisable and in the best interests of Centex and its stockholders for Centex to organize the Company, and to transfer substantially all of the business, operations, assets and liabilities related to Cavco Industries, LLC to the Company; and

     WHEREAS, the Company has agreed to assume substantially all of the business, operations, assets and liabilities related to Cavco Industries, LLC; and

     WHEREAS, the Board of Directors of Centex has also determined that it would be advisable and in the best interests of Centex and its stockholders for Centex to distribute on a pro-rata basis to the holders of record of Centex common stock, par value $0.25 per share (the “Centex Common Stock”), without any consideration being paid by such holders, all of the outstanding shares of the Company’s common stock, par value $.01 per share (the “Cavco Common Stock”), owned by Centex (the “Distribution”); and

     WHEREAS, for United States federal income tax purposes, the Distribution is intended to qualify as a tax-free spin-off within the meaning of Sections 355 and 368(a)(1)(D) of the United States Internal Revenue Code of 1986, as amended (the “Code”); and

     WHEREAS, from and after the date (the “Effective Date”) upon which the Distribution is effectuated, the Company desires to employ the Executive, and the Executive is willing to accept such employment, all upon the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the premises, the terms and provisions set forth herein, the mutual benefits to be gained by the performance thereof and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and subject to the Distribution being effectuated on or before June 30, 2003, the parties hereto agree as follows:

     SECTION 1. Definitions . For purposes of this Agreement, the following definitions shall apply:

1