##### 



Exhibit 10.3

(CHAMPION LOGO)

| |  |  | Champion Enterprises, Inc.
2701 Cambridge Court, Suite 300
Auburn Hills, Michigan 48326
| |  |  | ---------------------------------------------------------------------------------------

August 27, 2003

Mr. Walter R. Young
2701 Cambridge Court, Suite 300
Auburn Hills, Michigan 48326

Re: Resignation, Release, and Settlement Agreement

Dear Mr. Young:

This letter will serve as a resignation, release, and settlement agreement
(the Agreement) between you and Champion Enterprises, Inc., a Michigan
corporation (together with its successors and assigns, the Company).

This letter discusses several dates. Two of those dates come up
frequently. They are June 30, 2003, the date of termination of your employment
with the Company (the Termination Date), and August 27, 2003, the date of
this Agreement (the Agreement Date).

In consideration of the covenants undertaken and the releases contained in
this Agreement, you and the Company agree as follows.



|1. |  | Resignation. Effective on the Agreement Date and to the extent that your
tenure in any such positions has not already terminated, you resign all
positions you hold with the Company and every subsidiary or affiliate of
the Company, including, without limitation, the office of director of the
Company. You will sign individual resignations as the Company may
reasonably deem necessary to document your resignation in the books and
records of the Company and its subsidiaries and affiliates.  
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Termination of Employment Agreement. The employment agreement in letter
form dated April 27, 1990, as amended by subsequent letters dated May 7,
1990 and August 31, 1995 (the Employment Agreement) is terminated as of
the Termination Date.                                                                                                                                                                                                                                                           
|  
|3. |  | Return of Company Records. To the extent you have not already done so,
you will, by August 30, 2003, deliver to the Company all records, data and
memoranda of every kind and character relating to the Company and its
affiliates, including all copies thereof, that are in your possession or
control. Such records, data, and memoranda include, without limitation,
lists of customers, prices, costs, suppliers, engineering plans and
similar confidential and proprietary materials or information.





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|4. |  | Confidentiality; Non-Competition.
|-- |  | ---------------------------------



| | (a) |  | Confidentiality.
| | --- |  | ----------------



| | (i)  |  | Confidential Information Defined. Confidential
Information means any and all nonpublic information and
documentation relating to the Company and its Subsidiaries
(where Subsidiaries has the meaning ascribed to that term by
Section 424(f) of the Internal Revenue Code of 1986, as
amended), including, but not limited to, information relating
to operations, services, trade secrets, dealer, distributor,
and customer lists, promotion and pricing practices,
operational methods, market plans, studies, and forecasts,
product development plans, acquisition plans, design and
design projects, inventions and research projects,
compensation information, procurement and sales activities and
procedures, the existence or substance of any agreements
between the Company (or any Subsidiary) and any third party,
and any and all other information and documentation relating
to the plans and operations of the Company or its
Subsidiaries.                                                                                                                                                                                                                                                       
| | ---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (ii) |  | Confidentiality. Except with the prior written
consent of the Company, you have not since the Termination
Date disclosed, published, or in any other manner revealed
(other than in connection with your services as a director of
the Company), and you will not at any time hereafter disclose,
publish or in any other manner reveal, to any third party any
Confidential Information relating to the business or assets of
the Company or its Subsidiaries or make use of any
Confidential Information for your own purposes, or for the
benefit of any person or entity other than the Company and its
Subsidiaries. Anything herein to the contrary
notwithstanding, the provisions of this paragraph shall not
apply (A) when disclosure is required by law, (B) with respect
to litigation, arbitration or mediation involving this
Agreement or any other agreement between you and the Company,
including, but not limited to, the enforcement of such
agreements, (C) with respect to any cooperation provided by
you pursuant to Section 16 hereof or (D) as to Confidential
Information that becomes generally known to the public or
within the industry other than due to your violation of this
paragraph.



| | (b) |  | Non-Competition.
| | --- |  | ----------------



| | (i) |  | Prohibitions. Since the Termination Date you
have not and for all time periods hereafter until July 1, 2005
you will not:
| | --- |  | -------------------------------------------------------------------------------------------------------------------------



| | (A) |  | directly or indirectly (other than on
behalf of the Company), as owner, partner, joint
venturer, employee, broker, agent, principal, trustee,
corporate officer, licensor, consultant, or in any
capacity whatsoever, engage in, become financially
interested in, or have any connection with, any business
located in the United States or Canada engaged in the
production, sales, financing, insuring, or
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2



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| |     |  | marketing of manufactured homes or the development of
manufactured housing parks; provided that it shall not
be a breach of this provision for you to own not more
than two percent (2%) of any private or public entity;                         
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (B) |  | supply any competing products or
provide any competing services to any customer with whom
the Company or its Subsidiaries have done any business
during your employment with the Company; and                                                     
|
| | (C) |  | directly or indirectly, induce any
employee of the Company or its affiliates to engage in
any activity prohibited to you by this Section 4, or
directly induce any such employee to terminate their
employment with the Company or its affiliates.



| | (ii) |  | Acknowledgement and Enforcement.
| | ---- |  | --------------------------------



| | (A) |  | You acknowledge that the business of
the Company and its Subsidiaries is highly competitive.                                                                                                                                                                                                                                                                                                                                                     
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (B) |  | If any one or more of the terms
contained in this Section 4 is for any reason held to be
excessively broad with regard to time, duration,
geographic scope, or activity, that term shall be
construed in a manner to enable it to be enforced to the
maximum extent compatible with applicable law, provided,
that in no event shall such time, duration, geographic
scope or activity be broader than as originally set
forth in this Section 4.



| | (c) |  | The confidentiality (and requirement to return Company
records), non-competition, non-solicitation, non-disparagement and
cooperation covenants in Section 3, this Section 4 and in Sections
13, 16 and 17 hereof replace in their entirety any other
confidentiality (and requirement to return Company records),
non-competition, non-solicitation, non-disparagement or cooperation
covenants contained in any other Company plan, policy, program,
arrangement or other agreement, including, but not limited to, any
stock option agreement
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|5. |  | Compensation and Other Benefits. The Company will provide to you the
following things.
|-- |  | --------------------------------------------------------------------------------------



| | (a) |  | Salary. Your salary (but not incentive compensation or
benefits) for what would have been the remaining term of the
Employment Agreement. In particular, this includes the following
amounts (less withholding for applicable employment and payroll
taxes) for the following periods.
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (i) |  | Your salary and other amounts due through the
Termination Date.
| | --- |  | ---------------------------------------------------------------

3



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| | (ii)  |  | One years salary ($550,000.00) paid in lump sum
by August 29, 2003. This amount is attributable to the period
beginning July 1, 2003 and ending June 30, 2004.                                                             
| | ----- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (iii) |  | The remainder of the salary according to the
timing of salary payments for other officers of the Company.
Such payments will apply for the following dates and will be
calculated according to the following salary amounts.



| | (A) |  | July 1, 2003 through June 30, 2004 
No payment due.                                                                                                                       
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (B) |  | July 1, 2004 through December 31,
2004  Salary at the rate of $550,000 per year according
to the timing for payroll payment then in effect for
officers of the Company.   
|
| | (C) |  | January 1, 2005 through December 31,
2005  Salary at the rate of $600,000 per year according
to the timing for payroll payment then in effect for
officers of the Company.
|
| | (D) |  | January 1, 2006 through April 30,
2006  Salary at the rate of $600,000 per year according
to the timing for payroll payment then in effect for
officers of the Company.   



| | (iv) |  | The Company waives any right to reduction in the
payments due under this Section 5(a) on account of any
compensation you earn from another source.
| | ---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) |  | Health and Dental Insurance. The Company will provide to you
and to your spouse healthcare and dental coverage that is
substantially similar to the coverage the Company from time to time
provides to its executive officers, it being understood that such
coverage for executive officers may change from time to time.
Without limiting this obligation, the Company may elect to provide
part or all of this coverage for applicable periods by paying your
premiums for benefits under the Consolidated Omnibus Budget
Reconciliation Act of 1986 (COBRA), and you will facilitate this
method of providing that portion of your benefits by making the
appropriate elections under COBRA if the Company requests that you
do so. The Company will provide such healthcare and dental coverage
to you and to your spouse until the earlier to occur of your
65th
birthday or the date upon which you first become eligible for
substantially similar or better coverage in connection with an
employment or similar relationship with another organization. You
will timely notify the Company of your eligibility for such coverage
so that the Company may cease providing coverage under this
Agreement. If the coverage for which you become eligible is
substantially similar to, or better than, the benefits provided for
in this Agreement with regard to part, but not all, of such
benefits, the Company may elect to continue benefits under this
Agreement only to the extent that the benefits for which you become
eligible are not substantially similar to, or better than, the
benefits under this Agreement.
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4



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| | (c) |  | Options. Except as specifically stated in this Agreement,
your options continue to be governed by the specific option
agreements and the plan under which each option is granted.
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (i) |  | Exercise.
| | --- |  | ---------



| | (A) |  | Generally. You may exercise all or a
part of your options according to the terms of the
option grants and the plans under which such options
were granted.                                                                                                                                                                                                                                                                                                                                                                                                              
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (B) |  | Options Granted January 2001. With
regard to the 600,000 options granted in the Stock
Option Agreement between you and the Company dated
January 2, 2001 (the January 2001 Option Agreement),
and no other options, all such options shall vest
immediately as of the Agreement Date and you may
exercise such options at any time on or before January
2, 2008, notwithstanding any vesting requirements or
exercise limitations set forth in the January 2001
Option Agreement or in the 1995 Stock Option and
Incentive Plan, as amended, or any successor thereto.



| | (ii) |  | Cash-Out. As an alternative to exercise under
Section 5(c)(i)(B) above, you may cash out any options granted
under the January 2001 Option Agreement until September 28,
2003, in which case the Company will pay to you in cash for
each option the amount by which the market value of the
Companys common stock exceeds the option price on the date
you elect to cash out.
| | ---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) |  | Deferrals under Corporate Officer Stock Purchase Plan. You
have deferred portions of your compensation under the Companys
Corporate Officer Stock Purchase Plan. You will receive your Vested
Account Balance in shares of stock in accordance with the plan and
your election of July 30, 2003.
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (e) |  | Performance Shares. The measurements described in the
performance share award presently in effect have not been met and
you are due no payment or other benefit in connection with
performance shares.                                                                                           
|
| | (f) |  | Deferred Compensation Plan (Fidelity). You have previously
received all payments and other benefits to which you are entitled
under the Companys Deferred Compensation Plan and you are due no
other payment or other benefit thereunder.                                                       



|6. |  | Denial of Violation. The Company and you expressly deny any violation by
it or you of any of the Companys policies, procedures, state, or federal
laws or regulations. Accordingly, while this Agreement resolves all issues
between you and the Company relating to any alleged violation by the
Company or you of the Companys policies or procedures or any state or
federal law or regulation, this Agreement does not constitute an
adjudication or finding on the merits and it is not, and shall not be
construed as, an
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5



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|   |  | admission by the Company or you, as the case may be, of any violation of
the Companys policies or procedures, or state or federal laws or
regulations.                                                                                                                                                                                                                                                                                                                                 
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|7. |  | Settlement in Compromise. It is expressly understood by the parties that
this Agreement is a compromise and settlement of doubtful and disputed
claims and that payment or provision by the Company of the amounts or
items hereunder is not, nor is it to be construed as, an admission of
liability or wrongdoing on the part of the Company. Similarly, your
entering into this Agreement is not, nor is it to be construed as, an
admission of liability or wrongdoing on your part.
|  
|8. |  | Releases. Except for the provisions of this Agreement, which are not
affected by any releases, each of the parties releases the other party as
follows.                                                                                                                                                                                                                                                                                                                                 



| | (a) |  | Your Release of the Company. You (for yourself and your
family, heirs, executors, administrators, personal representatives,
legal representatives, agents, successors and assigns) hereby
forever and fully release, acquit, and discharge the Company (and
its subsidiaries, and affiliates, and their officers, directors,
agents, employees, attorneys, successors and assigns, each a
Company Releasee) of and from any and all claims, causes of
action, agreements, or any other liability of any nature whatsoever,
whether known or unknown, foreseen or unforeseen, arising out of any
matter or event occurring on or prior to the Agreement Date,
including, but not limited to, the terms of your Employment
Agreement, wrongful discharge, negligent or intentional infliction
of emotional distress, defamation, age discrimination, or any other
form of discrimination, breach of contract, claims for unused
vacation pay, or claims for any other employee benefit, and any and
all other claims of any nature arising out of or in any way relating
to your employment with the Company or the termination of your
employment or of your employment agreement, including any and all
claims under any federal, state, or local laws, regulations, rules
or ordinances, including, but not limited to, any claims under the
Age Discrimination in Employment Act of 1967, as amended, Title VII
of the Civil Rights Act of 1964, the Americans with Disabilities
Act, the Family and Medical Leave Act, the Elliott-Larsen Civil
Rights Act, the Michigan Whistle Blowers Act, the Michigan Persons
with Disabilities Civil Rights Act, or the Employee Retirement
Income Security Act of 1974, as amended. Anything to the contrary
notwithstanding in this Agreement, nothing herein shall release any
Company Releasee from any claims or damages based on (i) any right
or claim that arises after the Agreement Date, (ii) any right you
may have under this Agreement, (iii) your eligibility for
indemnification in accordance with applicable laws or the articles
of incorporation or by-laws of the Company, or under any applicable
insurance policy with respect to any liability you incur or have
incurred as a director, officer, employee or agent of the Company or
any affiliate, or (iv) any right you may have to obtain contribution
as permitted by law in the event of entry of judgment against you as
a result of any act or failure to act for which you and the Company
are jointly liable.
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | The Companys Release of You. The Company, on behalf of
itself and any other Company Releasee hereby forever and fully
releases, acquits, and discharges you                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

6



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| |  |  | (and your family, heirs, executors, administrators, personal
representatives, legal representatives, successors and assigns)
(each an Executive Releasee) of and from any and all claims,
causes of action, agreements, or any other liability of any nature
whatsoever, whether known or unknown, foreseen or unforeseen,
arising out of any matter or event occurring on or prior to the
Agreement Date, including, but not limited to, the terms of your
Employment Agreement and any and all other claims of any nature
arising out of or in any way relating to your employment with the
Company or the termination of your employment or of your employment
agreement, including any and all claims under any federal, state,
or local laws, regulations, rules or ordinances. Anything to the
contrary notwithstanding in this Agreement, nothing herein shall
release any Executive Releasee from any claims or damages based on
(i) any right or claim that arises after the Agreement Date, (ii)
any right the Company may have under this Agreement, or (iii) any
right the Company may have to obtain contribution as permitted by
law in the event of entry of judgment against the Company as a
result of any act or failure to act for which you and the Company
are jointly liable.
| |  |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|9.  |  | Unknown Damages or Injuries. You and the Company expressly understand
and agree that, except as specifically stated otherwise in this Agreement,
this is a full and final general release of all matters whatsoever and
that this general release is intended to, and does, embrace not only all
known and anticipated damages and injury, but also all unknown and
unanticipated damages, injuries or complications that may later develop or
be discovered, including all effects and consequences thereof, relating to
any claim released herein by you or the Company, as the case may be.                                 
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|10. |  | No Effect on 401(k) Plan. This Agreement will not affect your rights
under the terms of the Companys 401(k) plan (if any). The terms of the
401(k) Plan will remain effective as to you during the existence of such
plan.                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|11. |  | Lawsuit Forever Barred. It is the intention of the parties, and you
understand, that this Agreement will forever and for all time bar any
action, claim or administrative proceeding whatsoever that arose or that
might arise in the future from any acts, omissions, agreements or other
occurrences on or prior to the Agreement Date that relate to the claims
released by the parties herein, and that no lawsuit ever will be asserted
against any person or entity hereby released for any injury or damage,
whether known or unknown, sustained or to be sustained, with respect to
any claim released herein.         
|   
|12. |  | Advice of Counsel. You acknowledge that the Company has advised you to
seek the assistance of qualified legal counsel to advise you regarding
this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|13. |  | Confidentiality of the Terms of this Agreement. Unless and until the
Company publicly discloses this Agreement, you agree that the terms and
conditions of this Agreement constitute Confidential Information and will
remain confidential as between the parties and you will not disclose them
to any other person except your immediate family, your accountants or
financial advisors, your attorneys, or to any prospective employer (but
only to the extent necessary to inform such employer concerning any
restrictions, or lack thereof, on your ability to perform services for
such employer) or as required by law.

7



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|    |  | Without limiting the generality of the foregoing, unless required by law,
you will not respond to, or in any way participate in or contribute to,
any public discussion or other publicity concerning the execution of this
Agreement or the negotiations regarding its execution. In all events,
you shall be entitled to disclose the terms and conditions of this
Agreement in the manner provided inSection 4(a)(ii)(A)-(D) hereof.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|14. |  | Governing Law. This Agreement shall be interpreted in accordance with
the laws of the State of Michigan without regard for its conflict of law
rules.                                                                                                                                                                                                                                                                                  
|   
|15. |  | Severability. If any of this Agreement or the application thereof is
held invalid by a court of competent jurisdiction or an arbitrator, the
invalidity shall not affect other provisions or applications of the
Agreement which can be given effect without such invalid provisions or
applications and to this end the provisions of this Agreement are declared
to be severable.                                                    
|   
|16. |  | Cooperation and Additional Documentation.                                                                                                                                                                                                                                                                                                                                                                                              



| | (a) |  | If the Company reasonably requires your assistance in
connection with any litigation or other matter of which you have
knowledge on account of your employment with the Company, you will,
subject to your other personal and business commitments, make all
reasonable efforts to render reasonable assistance to the Company by
providing information, meeting with counsel and other professionals,
being available to be deposed and to testify, and as otherwise
reasonably necessary. The Company agrees to reimburse you for
reasonable expenses (including travel and meals) necessarily
incurred by you in providing any such assistance and you and the
Company will negotiate in good faith to establish your compensation
for such services.
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | The parties agree to cooperate fully and to execute any and
all supplementary documents and to take all additional actions that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        



| | (i)  |  | Are necessary or appropriate to give full force
and effect to the terms and intent of this Agreement; and
| | ---- |  | ---------------------------------------------------------------------------------------------------------
|
| | (ii) |  | Are not inconsistent with the terms of this
Agreement.                                                   



|17. |  | Non-Disparagement. Neither you nor any representative of the Company
will make or publish, or cause to be made or published, any disparaging,
defamatory, libelous, slanderous, or disruptive statements about the other
and/or, in the case of the Company, its officers, directors, and/or
products or services, or intentionally interfere with the contracts or
business relationships of the other. A breach of this provision may
constitute irreparable harm to the non-breaching party, and any party
aggrieved by a breach may bring an action for appropriate injunctive
relief to prohibit any further breach, as well as for all other available
legal and equitable remedies. Notwithstanding the foregoing, nothing in
this Section 17 shall prevent any party from (a) making a truthful
statement to respond publicly to incorrect, disparaging or derogatory
public statements made by the other party to the extent reasonably
necessary to correct or refute such public statement or (b) making any
truthful statement to the extent (i) necessary with respect to any
litigation,
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

8



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|    |  | arbitration or mediation involving this Agreement or any stock option
agreement, including, but not limited to, the enforcement of such
agreements, (ii) required by law, or (iii) necessary with respect to any
cooperation provided by you pursuant to Section 16 hereof. The Company
acknowledges that your engagement in the activities described in Section
4(b)(i) after July 1, 2005 would not constitute a breach of this Section
17.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|18. |  | Remedies. The parties acknowledge and agree that the injury from the
breach of the confidentiality and non-competition provisions of this
Agreement will be incalculable and irremediable and that it will be
extremely difficult, if not impossible, to accurately measure the damage
from any such breach. Accordingly, the parties agree that upon any breach
of such provisions of this Agreement, remedies at law may be inadequate.
The parties further agree that the nonbreaching party shall be entitled,
in addition to any other rights or remedies available to it, as a matter
of right, to obtain equitable and legal relief. Anything herein to the
contrary notwithstanding, the Companys obligation to make any payment or
provide any benefit or entitlement pursuant hereto shall not be affected
by any claim that the Company or any affiliate may have against you,
unless and until the following occurs: the Companys Board of Directors
makes a good faith determination that you materially breached this
Agreement resulting in demonstrable harm to the Company and provides you
with written notice describing the alleged breach and a period of 15 days
to cure, and if you fail to cure, the Company files a lawsuit against you
alleging such breach and harm (provided such suit is not dismissed and
proceeds to trial).                                                                                                                                  
|   
|19. |  | No Waiver. No failure by a party to exercise any right, power or remedy
hereunder or under applicable law shall affect such right, power or
remedy, nor shall any single or partial exercise thereof preclude any
further exercise thereof or the exercise of any other right, power or
remedy hereunder or under applicable law. The rights and remedies of the
parties are cumulative to all rights and remedies under applicable law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|20. |  | Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the parties and their respective successors, heirs (in
the case of you) and assigns. No rights or obligations of the Company
under this Agreement may be assigned or transferred by the Company without
you prior written consent, except that such rights or obligations may be
assigned or transferred pursuant to a merger or consolidation in which the
Company is not the continuing entity, or a sale, liquidation or other
disposition of all or substantially all of the assets of the Company,
provided that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and assumes the
liabilities, obligations and duties of the Company under this Agreement,
either contractually or as a matter of law. Your rights or obligations
under this Agreement may not be assigned or transferred by you, without
the Companys prior written consent, other than your rights to
compensation and benefits, which may be transferred only by will,
operation of law or as provided in this Section 20 or in an applicable
plan, program, grant or agreement of the Company. In the event of your
death or a judicial determination of your incompetence, references in this
Agreement to you shall be deemed to refer, where appropriate, to your
surviving spouse, legal representative or, where appropriate, to your
beneficiary or beneficiaries.
|   
|21. |  | Representations and Warranties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

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| | (a) |  | The Company represents and warrants that (i) the execution,
delivery and performance of this Agreement by the Company has been
fully and validly authorized by all necessary corporate action
(including any action required by the board of directors of the
Company (the Board) or any committee of the Board, including the
committee administering the 1995 Stock Option and Incentive Plan, as
amended), (ii) the officer signing this Agreement on behalf of the
Company is duly authorized to do so, (iii) the execution, delivery
and performance of this Agreement does not violate any applicable
law, regulation, order, judgment or decree or any agreement, plan or
corporate governance document to which the Company is a party or by
which it is bound and (iv) upon execution and delivery of this
Agreement by the parties, it shall be a valid and binding obligation
of the Company enforceable against it in accordance with its terms,
except to the extent that enforceability may be limited by
applicable bankruptcy, insolvency or similar laws affecting the
enforcement of creditors rights generally.
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (b) |  | You represent and warrant that (i) your execution, delivery
and performance of this Agreement does not violate any applicable
law, regulation, order, judgment or decree or any agreement, plan or
document to which the you are a party or by which you are bound and
(ii) upon execution and delivery of this Agreement by the parties,
it shall be a valid and binding obligation of yours enforceable
against you in accordance with its terms, except to the extent that
enforceability may be limited by applicable bankruptcy, insolvency
or similar laws affecting the enforcement of creditors rights
generally.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           



|22. |  | Notices. Any notice, request or other communication given in connection
with this Agreement shall be in writing and shall be deemed to have been
given (a) when personally delivered to the recipient or (b) provided that
a written acknowledgement of receipt is obtained, three days after being
sent by prepaid certified or registered mail, or two days after being sent
by a nationally recognized overnight courier, to the address specified in
this Section 22 (or such other address as the recipient shall have
specified by ten (10) days advance written notice given in accordance
with this Section 22). Such communication shall be addressed to you at
your home address and to the Company at its corporate headquarters (unless
such address is changed in accordance with this Section 22).
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|23. |  | Indemnification; D&O Liability Insurance. The Company agrees to continue
and maintain a directors and officers liability policy or policies
covering you at a level, and on terms and conditions, no less favorable to
you than the coverage the Company provides its current directors and/or
senior executives until such time as suits against you are no longer
permitted by law. Nothing in this Agreement shall be construed as
reducing or waiving any right to indemnification, or advancement of
expenses, you would otherwise have under the Companys articles of
incorporation or by-laws or under applicable law.                                                                                                                                                                                 

10



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##### 





|24. |  | Entire Agreement.
|--- |  | -----------------



| | (a) |  | The following items constitute and contain the entire
agreement and understanding between the parties concerning their
subject matter.
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------



| | (i)   |  | This instrument;                                                                                                                                                                                        
| | ----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (ii)  |  | The January 2001 Option Agreement (as modified
herein);                                                                                                                                                 
|
| | (iii) |  | The Stock Option Agreement between the Company
and you dated September 4 2001 (as modified herein);                                                                                                     
|
| | (iv)  |  | Such other option agreements as govern any
options you now hold (as modified herein);                                                                                                                   
|
| | (v)   |  | The Champion Enterprises, Inc. 1995 Stock Option
and Incentive Plan as amended and restated (or any successor
plan), to the extent that it applies to any awards or grants
in your favor under the plan;
|
| | (vi)  |  | The Companys Corporate Officer Stock Purchase
Plan, to the extent that it applies to any awards or grants in
your favor under the plan or to your participation in the
plan; and                       
|
| | (vii) |  | Such other benefit plans of the Company that
apply to any awards or grants in your favor under the plans or
to your participation in the plans.                                                         



| | (b) |  | This Agreement, including the items in Section 20(a) above,
supersedes and replaces all prior negotiations and agreements
between the parties with regard to the subject matter of such items,
proposed or otherwise, whether written or oral. This is an
integrated document.                                                                                                                                                                                                                
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (c) |  | Any amendment or modification to this Agreement must be in
writing and signed you and the Company. Any waiver of any provision
of this Agreement to be effective must be in writing specifically
referring to the provision being so waived and signed by the party
against whom enforcement is sought. No waiver of any provision of
this Agreement shall be effective as to any other provision of this
Agreement except to the extent specifically provided in an effective
written waiver.
|
| | (d) |  | This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument. Signatures
delivered by facsimile shall be effective for all purposes.                                                                                                                                                                                                                                    

[Signatures appear on the next page]

11



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##### 



Signature Page to

Resignation, Release, and Settlement Agreement

Sincerely,
and to evidence the Companys agreement,

Champion Enterprises, Inc.

|    |  |                    
|--- |  | -------------------
|By: |  | /s/ JOHN J. COLLINS
|    |  |                    
|    |  | (Signature)        

| |                    
| | -------------------
| | /s/ JOHN J. COLLINS
| |                    
| | (Printed name)     

|     |  |                                                         
|---- |  | --------------------------------------------------------
|Its: |  | /s/ Senior Vice President, Secretary and General Counsel
|     |  |                                                         
|     |  | (Title)                                                 

I have read the foregoing Agreement and I accept and agree to the provisions it
contains and hereby execute it voluntarily with full understanding of its
consequences.

EXECUTED as of the Agreement Date.

|                                    
|------------------------------------
|/s/ WALTER R. YOUNG

Walter R. Young

12