[ALIXPARTNERS LLC LETTERHEAD]

June 30, 2003

The Board of Directors
Champion Enterprises, Inc.
2701 Cambridge Court
Suite 300
Auburn Hills, MI 48326

Re: Financial and Operational Consulting Services

To The Board of Directors:

We appreciate the time that you spent with us describing the situation and
your objectives for Champion, and are pleased to present this proposal to
provide assistance.

This letter outlines the understanding between AlixPartners, LLC, a
Delaware limited liability company, ("AlixPartners") and Champion
Enterprises, Inc. (The "Company" or "Champion") of the work product and
fees for the engagement of AlixPartners to provide operational and
financial consulting services for inventory reduction to the Company.

ALIXPARTNERS ROLE

Based on your direction at our meeting we discussed the highest priority
focus for the organization in three main areas: Operations (manufacturing
and purchasing), financial/cash management, and strategy (retail and
financing). More specifically, you have asked several questions:

- How can Champion accelerate known cost reductions and identify
new ones?
- How can it improve manufacturing performance, including rapid
implementation of lean manufacturing concepts and improved
sourcing?
- How can it maintain and enhance liquidity, and what are the best
uses of its cash?
- What is the appropriate approach to retailing, and how can it be
accelerated?
- What is the appropriate approach to financing the product for
retailers and customers, and how can it be accelerated?

These questions will be addressed in a QuickStrike(TM) assessment of the
situation over a four to six week period that can be communicated to all of the
relevant stakeholder groups and executed rapidly. The objective of the
QuickStrike(TM) is to conduct a review of the Company through meetings with key
employees, on-site reviews and analysis

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The Board of Directors
June 30, 2003
Page 2

of existing improvement plans and financial and other information to gain a
working knowledge of the Company. We will explore a number of areas of the
Company's operations, working capital management, processes, and
infrastructure, with the goal of identifying profit and liquidity
enhancement opportunities and setting priorities. From the beginning our
efforts will be focused on delivering measurable results to Champion.

There are five initial areas in which we will focus our work:

MANUFACTURING BUSINESS RETAIL BUSINESS FINANCE BUSINESS LIQUIDITY COMPANY GENERAL
---------------------- --------------- ---------------- --------- ---------------

- - Plant and - Franchise - Current - Cash model - Full income
Brand Agreements contract and statement
Locations terms

- - Capacity and - Market and - Loan scale - Debt - Cost
utilization customer agreements vs. instruments breakouts for
studies collateralized COGS,
SG&A, etc.

- - Purchasing - Profit and - Past financial - Covenants - IT plan and
Spend Loss for relationships costs
channel and
brand

- - Plant Cost - Locations and - Warehousing - Board update
Structures markets facilities packages
served

- - Distribution/ - Promotion - Floor - Performance
Logistic programs planning Metrics
models/ costs Facilities

- - Cycle times - Competitive - Cap X budget
and lead time analysis and
strategies

- - Inventory - Current
levels improvement
project
review

- - P&L - Financial
model

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The Board of Directors
June 30, 2003
Page 3

There is a set of activities that we will want to perform during the first
week to begin the process of better understanding the details of the
Champion business. They include:

- Current financial and performance metric review
- Current improvement project reviews
- Plant visits
- Retail site visits
- Interviews/discussions with critical internal and external
decision makers

As we discussed, we will not perform these analyses from scratch. Rather,
we build upon work already done by the Company or its advisors.

The objective for this phase of the work will be the development of a
description of the plans to achieve the opportunities, timing and benefit
target. If feasible, we will integrate these benefits with the Company's
existing income and cash forecasts to determine their impact on the
Company's financial structure.

We will also work with you to establish a financial performance baseline
against which the success of this program will be measured.

STAFFING

John Hoffecker will be the Principal responsible for the overall
engagement. He will be assisted by a staff of 3-4 consultants at various
levels, all of whom have a wide range of skills and abilities related to
this type of assignment. In addition, we have relationships with and
periodically retain independent contractors with specialized skills and
abilities to assist us.

TIMING, FEES AND EXPENSES

We estimate the time for completion to be four to six weeks, depending upon
the availability of management, key personnel, and data. We are prepared to
commence Phase I of this engagement immediately upon receipt of Company
approval in the form of a signed copy of this letter and the retainer.

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The Board of Directors
June 30, 2003
Page 4

This engagement will be staffed with professionals at various levels, as
the tasks require. For purposes of monthly billings, our fees will be based
on the hours charged at our hourly rates, which are:

Principals $540 - $670
Senior Associates $430 - $495
Associates $300 - $390
Consultants $225 - $280

For the QuickStrike(TM) phase, we agree not to exceed $500,000 in
professional fees without your written approval. Because it is anticipated
that Albert A. Koch, by separate agreement with the Company and AP
Services, LLC will become chairman of the board and interim president and
chief executive officer of the Company, we agree that any such
authorization will need to come from the disinterested members of the Board
of Directors. We will require a retainer of $100,000 to be applied against
the time charges and expenses specific to the engagement. We also
acknowledge that, notwithstanding Section 10 of the General Terms and
Conditions referred to herein, there is no Contingent Success Fee that is a
part of our agreement and that the Company's only obligation is to pay the
hourly rates for time actually worked by personnel as described above.

The terms and conditions set out in the attached General Terms and
Conditions form part of and are incorporated by reference herein to this
agreement.

We acknowledge that the Company has no obligation to retain our services
beyond the QuickStrike(TM) assessment and that the Company may retain and
use the services of other consultants before, during, and after this
engagement.

If these terms meet with your approval, please sign and return the enclosed
copy of this agreement and wire transfer the amount to establish the
retainer.

[ALIXPARTNERS LLC LOGO]

The Board of Directors
June 30, 2003
Page 5

Thank you for the opportunity to assist you in this key effort. We look
forward to working with you.

Sincerely yours,
ALIXPARTNERS, LLC

/s/ John F. Hoffecker
------------------------------------
John F. Hoffecker
Principal

Acknowledged and Agreed to:

CHAMPION ENTERPRISES, INC.

By: /s/ John J. Collins, Jr.
------------------------------------------------------
Its: Senior Vice President, General Counsel and Secretary
------------------------------------------------------
Dated: June 30, 2003
------------------------------------------------------

ALIXPARTNERS, LLC
GENERAL TERMS AND CONDITIONS

These General Terms and Conditions ("Terms") shall govern the services provided
by AlixPartners, LLC ("AlixPartners") as set forth in the letter agreement
executed by the Company and AlixPartners to which these Terms are attached.

SECTION 1. COMPANY RESPONSIBILITIES

COMPANY WILL UNDERTAKE RESPONSIBILITIES AS SET FORTH BELOW:

1. Provide reliable and accurate detailed information, materials,
documentation, and
2. Make decisions and take future actions, as the Company determines in
its sole discretion, on any recommendations made by AlixPartners in
connection with the tasks or deliverables under this Agreement.

AlixPartners' delivery of the services and the fees charged are dependent on (i)
Company's timely and effective completion of its responsibilities; and (ii)
timely decisions and approvals made by the Company's management. Company shall
be responsible for any delays, additional costs, or other deficiencies caused by
not completing its responsibilities.

SECTION 2. TIMING, FEES, AND EXPENSES.

The engagement will commence immediately upon receipt of a signed engagement
letter and a retainer.

HOURLY FEES. For purposes of monthly billings, our fees will be based on the
hours charged at our hourly rates as set forth in the letter agreement. We
review and revise our hourly billing rates effective January l of each year.

CONTINGENT SUCCESS FEES. As described in the attached agreement.

OUT-OF-POCKET EXPENSES. In addition to hourly fees as defined in the letter
agreement, the Company shall pay directly or reimburse AlixPartners upon receipt
of periodic billings for all reasonable out-of-pocket expenses incurred in
connection with this assignment such as travel, lodging, postage, and a
communications charge of $4.00 per billable hour to cover telephone and
facsimile charges.

RETAINER. We require a retainer to be applied against the time charges and
expenses specific to the engagement. We will submit monthly invoices for
services rendered and expenses incurred as described above, and will offset such
invoices against the retainer. Payment will be due upon receipt of the invoices
to replenish the retainer to the agreed-upon amount. Any unearned portion of the
retainer will be returned to you at the termination of the engagement.

SECTION 3. RELATIONSHIP OF THE PARTIES.

The parties intend that an independent contractor relationship will be created
by this Agreement. AlixPartners is not to be considered an employee or agent of
the Company and the employees of AlixPartners are not entitled to any of the
benefits that the Company provides for the Company's employees.

The Company also agrees not to solicit, recruit, or hire any employees or agents
of AlixPartners for a period of two years subsequent to the completion and/or
termination of the letter agreement.

SECTION 4. CONFIDENTIALITY.

AlixPartners agrees to keep confidential all information obtained from the
Company. AlixPartners agrees that neither it nor its directors, officers,
principals, employees, agents or attorneys will disclose to any other person or
entity, or use for any purpose other than specified herein, any information
pertaining to the Company or any affiliate thereof which is either non-public,
confidential or proprietary in nature ("Information") which it obtains or is
given access to during the performance of the services provided hereunder. The
foregoing is not to be construed as prohibiting AlixPartners from disclosure
pursuant to a valid subpoena or court order, but AlixPartners will not
encourage, suggest, invite or request, or assist in securing, any such subpoena
or court order, and it shall immediately give notice of any such subpoena or
court order by fax transmission to the Company. AlixPartners may make reasonable
disclosures of Information to third parties in connection with their performance
of their obligations and assignments hereunder. In addition, AlixPartners will
have the right to disclose to others in the normal course of business that the
Company has retained its services.

Information includes data, plans, reports, schedules, drawings, accounts,
records, calculations, specifications, flow sheets, computer programs, source or
object codes, results, models, or any work product relating to the business of
the Company, its subsidiaries, distributors, affiliates, vendors, customers,
employees, contractors, and consultants.

The Company acknowledges that all advice (written or oral) given by AlixPartners
to the Company in connection with AlixPartners' engagement is intended solely
for the benefit and use of the Company (limited to its management and Board of
Directors) in considering the services to which it relates. Such advice will be
considered Work Product and will be subject to the restrictions on disclosure
contained in Section 5.

SECTION 5. INTELLECTUAL PROPERTY.

Company shall own and retain all right, title, and interest in and to all of the
work product AlixPartners produces or has produced in connection with, or
related to, its performance under this agreement (collectively, the "Work
Product"). The Work Product includes, without limitation:

(i) Patents, patent applications, copyrights, trademarks, trade secrets, and
other intellectual property rights;

(ii) Works of authorship (which shall be considered "works made for hire" under
relevant copyright law); and

(iii) Methodologies, processes, techniques, ideas, concepts, and know-how

AlixPartners hereby transfers and assigns to the Company all right, title, and
interest in the Work Product. AlixPartners will execute and deliver all
documents and perform all acts that the Company reasonably deems necessary to
perfect the Company's rights in the Work Product.

ALIXPARTNERS, LLC
GENERAL TERMS AND CONDITIONS

When disclosing any Work Product to any third party, the Company shall not,
without AlixPartners' prior consent (which shall not be unreasonably withheld),
identify AlixPartners as the source of, or a contributor to, such Work Product
unless so required by a rule of law.

The Company hereby grants to AlixPartners a limited, non-exclusive license to
use such of the Work Product as constitutes generic templates and plans with
application to business enterprises generally, except that:

(i) No such Work Product may contain any Information;

(ii) No such Work Product may identify the Company in any way; and

(ii) AlixPartners may not use any Work Product for or on behalf of any
competitor of the Company or for any purpose that would constitute or aid
competition with the Company or adversely affect the Company's reputation
or interests.

AlixPartners owns, and will continue to own (and the Work Product will not
include), any methodologies, processes techniques, ideas, concepts and know-how
AlixPartners supplies in connection with this agreement and developed
independently of its performance in connection with this agreement and without
reference to any Information ("AlixPartners' IP"), except that the Company will
have a perpetual, non-exclusive, worldwide, royalty-free license to use and have
used for the Company's own business purposes such of the AlixPartners' IP as is
incorporated into any Work Product.

SECTION 6. FRAMEWORK OF THE ENGAGEMENT.

The Company acknowledges that it is hiring AlixPartners purely to assist and
advise the Company business planning and restructuring services. AlixPartners'
engagement shall not constitute an audit, review, or compilation, or any other
type of financial statement reporting or consulting engagement that is subject
to the rules of the AICPA, the SSCS or other such state and national
professional bodies.

SECTION 7. INDEMNIFICATION

In engagements of this nature, it is our practice to receive indemnification.
Accordingly, in consideration of our agreement to act on your behalf in
connection with this engagement, you will indemnify, hold harmless, and defend
us (including our principals, employees, and agents) from and against all
third-party claims, liabilities, losses, damages and reasonable expenses as they
are incurred, including reasonable legal fees and disbursements of counsel, and
the costs of our professional time (our professional time will be reimbursed at
our actual direct costs without overhead allocation when such future time is
required) (collectively, "Losses"), relating to or arising out of the
engagement, including any legal proceeding in which we may be required, or
agree, to participate, but in which we are not a party. We, our principals,
employees, and agents may, but are not required to, engage a single firm of
separate counsel of our choice at our cost in connection with any of the matters
to which this indemnification agreement relates. This indemnification agreement
does not apply to Losses resulting from actions taken or omitted to be taken by
us in bad faith, our gross negligence, or our willful misconduct.

AlixPartners is not responsible for any third-party products or services. The
Company's sole and exclusive rights and remedies with respect to any third party
products or services, are against the third party vendor and not against
AlixPartners.

SECTION 8. DISCLOSURES.

We know of no fact or situation, other than those disclosed in the letter
agreement, which would represent a conflict of interest for us with regard to
the Company.

While we are not aware of any relationships, other than those disclosed in the
letter agreement, that connect us to any party in interest, because AlixPartners
is a consulting firm that serves clients on a national basis in numerous cases,
it is possible that AlixPartners may have rendered services to or have business
associations with other entities which had or have relationships with the
Company. AlixPartners has not and will not represent the interests of any of
these aforementioned entities in this case, involving the Company.

SECTION 9. GOVERNING LAW

This letter agreement is governed by and construed in accordance with the laws
of the State of Michigan with respect to contracts made and to be performed
entirely therein and without regard to choice of law or principles thereof.

If we have any dispute arising between us, including any dispute with respect to
the letter agreement, its interpretation, performance or breach, and are unable
to agree on a mutually satisfactory resolution within 30 days, either party may
require the matter to be settled by binding arbitration. If such arbitration
shall occur, it shall be in the city of Southfield, Michigan. We shall attempt
for two weeks to agree on a single arbitrator. If that effort shall fail, each
party shall appoint one arbitrator. The two arbitrators so chosen shall attempt
for two weeks to select a third. If they are unable to agree, the American
Arbitration Association in Southfield, MI shall choose the third. The
arbitration shall occur using the rules and procedures of the American
Arbitration Association. The decision of the arbitrator(s) shall be final,
binding, and non-appealable.

SECTION 10. TERMINATION AND SURVIVAL.

The letter agreement may be terminated at any time by written notice by one
party to the other; provided, however, that notwithstanding such termination,
AlixPartners will be entitled to any fees and expenses due under the provisions
of the agreement. Such payment obligation shall inure to the benefit of any
successor or assignee of AlixPartners.

Additionally, unless AlixPartners is terminated by the Company for cause (as
defined below) or due to circumstances described in the Contingent Success Fee
provision in the letter agreement, AlixPartners shall remain entitled to the
Contingent Success Fee(s) that otherwise would be payable for the greater of 12
months from the date of termination or the period of time that that has elapsed
from the date of this letter to the date of termination. Cause shall mean a
AlixPartners representative acting in good faith on behalf of the Company is
convicted of a felony or it is determined in good faith by the Board of
Directors of the Company, and after thirty (30) days notice and opportunity to
cure either (i) an AlixPartners representative engages in misconduct injurious
to the Company, or (ii) an AlixPartners representative breaches any of his or
its material obligations under this Agreement; or (iii) an AlixPartners
representative willfully disobeys a lawful direction of the Board of Directors
or senior management of the Company.

Sections 2, 4, 5, 7, 9, 10, and 11 shall survive the expiration or termination
of the letter agreement.

SECTION 11. GENERAL.

ALIXPARTNERS, LLC
GENERAL TERMS AND CONDITIONS

SEVERABILITY. If any portion of the letter agreement shall be determined to be
invalid or unenforceable, we each agree that the remainder shall be valid and
enforceable to the maximum extent possible.

ENTIRE AGREEMENT. The Terms and the attached letter agreement contain the entire
understanding of the parties relating to the services to be rendered by
AlixPartners and may not be amended or modified in any respect except in writing
signed by the parties. AlixPartners will not be responsible for performing any
services not specifically described in this letter or in a subsequent writing
signed by the parties. If there is a conflict between these Terms and the letter
agreement, these Terms shall govern.

NOTICES. All notices required or permitted to be delivered under this letter
agreement shall be sent, if to AlixPartners, to the address set forth in the
letter agreement, to the attention of Mr. Melvin R. Christiansen, and if to
Company, to the address set forth in the letter agreement, to the attention of
your General Counsel, or to such other name or address as may be given in
writing to the other party. All notices under the letter agreement shall be
sufficient if delivered by facsimile or overnight mail. Any notice shall be
deemed to be given only upon actual receipt.

SECURITIES. Except as specifically agreed with Al Koch personally in connection
with his options or otherwise, neither AlixPartners nor any of its affiliates
will, during the term of the engagement under this agreement or for a year
thereafter, purchase any of the common stock of the Company or any security
convertible into or exchangeable for the common stock of the Company in open
market transactions, privately negotiated transactions, or otherwise. The term
"affiliates" has the meaning ascribed to it in the context of the securities
laws of the United States.