AMENDMENT NO. 1 TO

SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (THE "EXCHANGE ACT")

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

PALM HARBOR HOMES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
Not Applicable
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.

(1) Title of each class of securities to which transaction
applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how it
was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid: $

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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:

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(2) Form, Schedule or Registration Statement no.:

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(3) Filing Party:

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(4) Date Filed:

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PALM HARBOR HOMES, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
JULY 23, 2003

To Our Shareholders:

You are invited to attend the annual meeting of shareholders of Palm
Harbor Homes, Inc. which will be held at the Colonnade Conference Center, 15303
Dallas Parkway, Addison, Texas, on July 23, 2003, at 10:00 a.m., Dallas time.
The purpose of the meeting is to vote on the following proposals:

PROPOSAL 1: To elect eight directors to serve for a one year
term, and until their successors are duly elected and
qualified.

PROPOSAL 2: To ratify the selection of Ernst & Young LLP as
independent auditors for the fiscal year ending March
26, 2004.

PROPOSAL 3: To take action upon any other business that may
properly be brought before the annual meeting.

The board of directors has fixed the close of business on June 2, 2003
as the record date for determining shareholders entitled to receive notice of
and to vote at the annual meeting. A form of proxy card and a copy of our Annual
Report to Shareholders for the fiscal year ended March 28, 2003 are enclosed
with this notice of annual meeting and proxy statement. You may also vote by
phone or via the Internet by following the steps detailed on the proxy card.

YOUR VOTE IS IMPORTANT. ACCORDINGLY, YOU ARE ASKED TO COMPLETE, DATE,
SIGN AND RETURN THE ACCOMPANYING PROXY, OR VOTE BY PHONE OR VIA THE INTERNET,
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. IF YOU PLAN TO ATTEND THE
ANNUAL MEETING TO VOTE IN PERSON AND YOUR SHARES ARE REGISTERED WITH OUR
TRANSFER AGENT, AMERICAN STOCK TRANSFER & TRUST COMPANY, IN THE NAME OF A BROKER
OR BANK, YOU MUST SECURE A PROXY FROM THE BROKER OR BANK ASSIGNING VOTING RIGHTS
TO YOU FOR YOUR SHARES.

BY ORDER OF THE BOARD OF DIRECTORS

Kelly Tacke,
Chief Financial Officer,
Vice President - Finance and Secretary

June 15, 2003
Addison, Texas

PROXY STATEMENT

----------

ANNUAL MEETING OF SHAREHOLDERS
JULY 23, 2003

----------

PALM HARBOR HOMES, INC.
15303 DALLAS PARKWAY, SUITE 800
ADDISON, TEXAS 75001

The board of directors is soliciting proxies to be used at the 2002
annual meeting of shareholders to be held at the Colonnade Conference Center,
15303 Dallas Parkway, Addison, Texas, on Wednesday, July 23, 2003, at 10:00
a.m., Dallas time. This proxy statement, accompanying proxy and annual report to
shareholders for the fiscal year ended March 28, 2003 are first being mailed to
shareholders on or about June 18, 2003. Although the annual report is being
mailed to shareholders with this proxy statement, it does not constitute part of
this proxy statement.

WHO CAN VOTE

Only shareholders of record as of the close of business on June 2, 2003
are entitled to notice of and to vote at the annual meeting. As of June 2, 2003,
we had 22,863,396 outstanding shares of common stock, our only outstanding
voting security. Each shareholder of record of our common stock on the record
date is entitled to one vote on each matter properly brought before the annual
meeting for each share of common stock held. IF YOU HOLD SHARES OF OUR COMMON
STOCK THROUGH ANY OF OUR STOCK PURCHASE OR SAVINGS PLANS, YOU WILL RECEIVE
VOTING INSTRUCTIONS FROM THE PLANS' ADMINISTRATOR. PLEASE SIGN AND RETURN THOSE
INSTRUCTIONS PROMPTLY TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE ANNUAL
MEETING.

In accordance with our bylaws, a list of shareholders entitled to vote
at the annual meeting will be available at the annual meeting and for 10 days
prior to the annual meeting, between the hours of 9:00 a.m. and 4:00 p.m. local
time at our offices located at 15303 Dallas Parkway, Suite 800, Addison, Texas.

HOW YOU CAN VOTE

Shareholders cannot vote at the annual meeting unless they are present
in person or represented by proxy. After you have reviewed the information
contained in this proxy statement, please take a moment to read the instructions
and choose the way to vote that you find most convenient and cast your vote as
soon as possible. You may vote by completing and returning the enclosed proxy.
Your proxy will be voted in accordance with your instructions. Alternatively, if
you are a shareholder of record (that is, if your stock is registered with the
company in your own name), you may vote by telephone or electronically through
the Internet by following the instructions set forth on your proxy. The deadline
for voting by telephone or electronically through the Internet as a shareholder
of record is 3:00 p.m., Dallas time, on July 23, 2003. Valid proxies will be
voted at the annual meeting and at any adjournments of the annual meeting as you
direct in the proxy.

You may revoke your proxy or otherwise change your vote at any time
before it is exercised by:

o delivering a written notice of revocation to our Secretary, Kelly
Tacke, at Palm Harbor Homes, Inc., 15303 Dallas Parkway, Suite
800, Addison, Texas 75001;

o timely delivering a properly executed, later-dated proxy;

o submitting a later-dated vote by telephone or via the Internet; or

o voting in person at the annual meeting.

Voting by proxy or via the Internet will in no way limit your right to
vote at the annual meeting if you later decide to attend in person. If your
shares are held in the name of a bank, broker or other holder of record, you
must obtain a proxy, executed in your favor, to be able to vote at the annual
meeting. If you submit a proxy and no direction is given and the proxy is
validly executed, the shares represented by the proxy will be voted in favor of
proposals one and two. The persons authorized under the proxies will vote upon
any other business that may properly come before the annual meeting according to
their best judgment. As of the date of mailing of this proxy statement, we did
not anticipate that any other matters will be raised at the annual meeting.

REQUIRED VOTE

The presence, in person or represented by proxy, of the holders of a
majority of our outstanding common stock (11,431,699 shares) entitled to vote at
the annual meeting is necessary to constitute a quorum at the annual meeting.
However, if a quorum is not present at the annual meeting, the shareholders,
present in person or represented by proxy, have the power to adjourn the annual
meeting until a quorum is present or represented. Abstentions and broker
"non-votes" are counted as present and entitled to vote for purposes of
determining a quorum at the annual meeting. A broker "non-vote" occurs when a
nominee holding common shares for a beneficial owner does not vote on a
particular proposal because the nominee does not have discretionary voting power
with respect to that item and has not received instructions from the beneficial
owner.

A plurality of the votes duly cast is required for the election of
directors (i.e., the nominees receiving the greatest number of votes will be
elected). Abstentions and broker non-votes are not counted for purposes of the
election of directors. All of the nominees for director, served as our directors
during the fiscal year ended March 28, 2003.

COST OF PROXY SOLICITATION

The cost of soliciting proxies will be borne by us. Proxies may be
solicited on our behalf by our directors, officers or employees in person, by
telephone, facsimile or by other electronic means. They will not be separately
compensated for their services.

In accordance with SEC regulations and the regulations of The Nasdaq
Stock Market, we will also reimburse brokerage firms and other custodians,
nominees and fiduciaries for their expenses incurred in sending proxies and
proxy materials to the beneficial owners of shares of our common stock and
soliciting proxies from them.

GOVERNANCE OF THE COMPANY

Pursuant to the Florida Business Corporation Act, our articles of
incorporation and our bylaws, our business, property and affairs are managed
under the direction of the board of directors. During the fiscal year ended
March 28, 2003, the board of directors held four meetings. No director attended
less than 75% of the total number of board meetings and meetings of committees
on which he served that were held while the director was a committee member.

COMMITTEES OF THE BOARD OF DIRECTORS

<Table>
<Caption>
COMPENSATION
NAME BOARD AUDIT COMMITTEE COMMITTEE
- ------------------------------------- ----------- ----------------- --------------------

Lee Posey x*
Larry H. Keener x
Walter D. Rosenberg, Jr. x
William R. Thomas x x*
Frederick R. Meyer x x x
John H. Wilson x x
A. Gary Shilling x
Jerry D. Mallonee x x*
</Table>

- ----------

* Chairman

During the fiscal year ended March 28, 2003, the board of directors had
two ongoing committees: an audit committee and a compensation committee. The
board of directors does not have a nominating committee.

The audit committee consists of three "independent directors" as
required by the Sarbanes-Oxley Act of 2002 and The Nasdaq National Market listed
requirements. Our board has adopted a written charter for the audit committee
setting forth the duties and responsibilities of the committee. The charter has
been submitted to our board of directors for approval. A copy of the audit
committee charter that was submitted to the board is attached to this proxy
statement as Appendix A.

The audit committee assists the board with its oversight
responsibilities to shareholders by monitoring (1) the quality and integrity of
the financial statements of the company; (2) the independence, qualification and
performance of the company's independent auditors; (3) the company's accounting
and financial reporting processes; and (4) audits of the company's financial
statements. The committee has the responsibility for selecting the company's
independent auditors and pre-approving audit and non-audit services. The audit
committee met four times during the fiscal year ended March 28, 2003.

The compensation committee consists of two non-employee directors. The
functions of the compensation committee include establishing the compensation of
executive officers and administering management incentive compensation plans.
The compensation committee met once during the fiscal year ended March 28, 2003.

COMPENSATION OF DIRECTORS

During the fiscal year ended March 28, 2003, our non-employee directors
received compensation as follows:

<Table>

Annual retainer fee ...................................................................... $8,000
Fee for each board meeting attended (other than telephonic) .............................. $2,000
Fee for each committee meeting (other than those on the same day as board meeting) ....... $ 500
</Table>

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of our executive officers served as a member of the compensation
committee of our board of directors. None of our executive officers served as a
director of any other entity whose executive officer served as a member of our
compensation committee.

REPORT OF THE COMPENSATION COMMITTEE

Decisions on compensation of our executive officers are made by the two
member compensation committee of the board of directors. Each member of the
compensation committee is an outside director. None of the members of the
compensation committee has ever been an officer or employee of Palm Harbor or
any of its subsidiaries. The compensation committee, in consultation with the
Chairman of the Board, is responsible for establishing the policies that govern
compensation of executive officers and key employees at the corporate level.

The goals of our compensation program are to attract, retain and
motivate competent executive officers and key employees who have the experience
and ability to contribute materially to our long-term success. Our compensation
philosophy for our executive officers and key employees is predicated on base
salaries which are in most instances below salaries for comparable industry
positions and potential bonuses which, depending on our earnings performance in
relation to pre-established base levels, may be relatively high or relatively
low in comparison with bonus payments by companies of comparable size and type.

Base salaries are determined by our compensation committee for each of
the executive officers on an individual basis, taking into consideration the
level of responsibility, individual contributions to our performance, length of
tenure with us, compensation levels of comparable positions and internal
equities among positions. In most instances, base salaries are set at
subjectively-determined levels below base salaries paid to executives in similar
positions in companies of comparable size in the same industry or similar
industries. Bonuses are determined from year to year by the compensation
committee based in part on our earnings performance and in part on the
recommendation of the Chairman of the Board and the Chief Executive Officer who
do not offer recommendations regarding their own compensation. The base salary
of our President and the Chief Executive Officer, Larry H. Keener, was $200,000
for the fiscal year ended March 28, 2003, and is currently set at an annual rate
of $200,000 for the fiscal year ending March 26, 2004. Mr. Keener's bonus of
$200,000 for the fiscal year ended March 28, 2003 was determined by the
compensation committee on a discretionary basis.

Effective March 27, 1999, the annual base salary of Lee Posey, our
Chairman of the Board, was set at $400,000 for three years and $300,000
thereafter pursuant to a compensation agreement which among other things
specified that Mr. Posey would provide a minimum of 100 days of service in each
of the first three years of the agreement and 75 days of service during the last
five years of the agreement. Mr. Posey is not a participant in the corporate
bonus plan or the long-term incentive plan. The agreement has been amended to
reflect that Mr. Posey shall be paid $400,000 in any year in which he provides a
minimum of 100 days of service. Because of the number of days of service
provided by Mr. Posey for the fiscal year ended March 28, 2003, Mr. Posey
received a salary of $400,000.

For the past four fiscal years, commencing in fiscal 2000, Palm Harbor
has provided a long-term incentive plan for its officers and key employees
(excluding Mr. Posey and Mr. Keener). Plan participants have been awarded shares
in an amount equivalent to 10% of their cash compensation,

but not in excess of $40,000. Shares awarded under the plan do not vest for
three years. For fiscal 2003, approximately 145,000 shares having a value of
$2,987,310 on the date of issue were awarded under the plan. No long-term
incentive plan has been established for fiscal 2004.

We do not have a stock option plan for our key employees and executive
officers and have not had a stock option plan since our company was founded.

COMPENSATION COMMITTEE

William R. Thomas, Chairman
Frederick R. Meyer

REPORT OF THE AUDIT COMMITTEE

The audit committee is composed of three independent directors and
operates under a written charter adopted by the board of directors. The board
has determined that each committee member is independent as defied by the
Sarbanes-Oxley Act of 2002 and the Nasdaq listing standards as currently in
effect.

Pursuant to the audit committee charter that has been submitted to the
board for approval, the audit committee will assist the board of directors in
monitoring (1) the integrity of the financial statements of the company, (2) the
independence, qualifications, performance of the company independent auditors,
(3) the company's accounting and financial reporting process; and (4) audits of
the company's financial statements. Management has the primary responsibility
for the financial statements and the reporting process including the systems of
internal controls. The audit committee reviewed the audited annual financial
statements with management including a discussion of the quality, not just the
acceptability, of the accounting principles, the reasonableness of significant
judgments, and the clarity of disclosures in the financial statements.

The audit committee reviewed the audited annual financial statements
with Ernst & Young LLP, the company's independent auditors, who are responsible
for expressing an opinion on the conformity of the company's audited financial
statements with generally accepted accounting principles, their judgment as to
the quality, not just the acceptability, of the company's accounting principles
and such other matters as are required to be discussed with the audit committee
under generally accepted auditing standards, including the Statement on Auditing
Standards No. 61, as amended, "Communication with Audit Committees." The
committee also discussed with management and Ernst & Young LLP the process used
to support certifications by the company's Chief Executive Officer and Chief
Financial Officer that are required by the SEC and the Sarbanes-Oxley Act of
2002 to accompany the company's periodic filings with the SEC. In discharging
its oversight responsibility as to the audit process, the audit committee
obtained from the independent auditors a formal written statement describing all
relationships between the auditors and the company that might bear on Ernst &
Young LLP's independence consistent with Independent Standards Board Standard
No. 1, "Independence Discussions with Audit Committees," discussed with the
auditors any relationships that may impact their objectivity and independence
and satisfied itself as to the auditors' independence.

The committee reviewed with Ernst & Young LLP the overall scope and
plans for their audit. The committee met with the independent auditors, with and
without management present, to discuss the results of their examination, their
evaluations of the company's internal controls, and the overall quality of the
company's financial reporting. The committee held three meetings relating to the
fiscal 2003 audit and financial statements.

In reliance on the reviews and discussions referred to above, the audit
committee recommended to the board of directors (and the board of directors has
approved) that the audited financial statements be included in the Annual Report
on Form 10-K for the year ended March 28, 2003 for filing with the SEC. The
audit committee, subject to shareholder ratification, recommended to the board
the selection of Ernst & Young LLP as independent auditors for the fiscal year
ending March 26, 2004.

The full responsibilities of the audit committee are set forth in the
audit committee's charter. A copy of the audit committee charter that has been
submitted to the board for approval, is included as Appendix A to this proxy
statement.

AUDIT COMMITTEE

Jerry D. Mallonee, Chairman
Frederick R. Meyer
John H. Wilson

SHARE OWNERSHIP OF PRINCIPAL SHAREHOLDERS,
DIRECTORS AND MANAGEMENT

The following table sets forth certain information regarding the
beneficial ownership of our shares of common stock as of June 2, 2003 by (1)
each person known by us to own beneficially more than 5% of our outstanding
common stock, (2) each current director, (3) each named executive officer, and
(4) all current directors and named executive officers as a group. Unless
otherwise indicated, the shares listed in the table are owned directly by the
individual or entity, or by both the individual and the individual's spouse.
Except as otherwise noted, the individual or entity had sole voting and
investment power as to shares shown or, in the case of the individual, the
voting power is shared with the individual's spouse.

Certain of the shares listed below are deemed to be owned beneficially
by more than one shareholder under SEC rules.

<Table>
<Caption>
AMOUNT AND NATURE OF
NAME BENEFICIAL OWNERSHIP(1) PERCENT OF CLASS
- ------------------------------------------------------ --------------------------------- ----------------------

Lee Posey
15303 Dallas Parkway
Suite 800
Addison, Texas 75001 4,354,185 19.04%

Capital Southwest Corporation and
Capital Southwest Venture Corporation(2)
12900 Preston Road
Suite 700
Dallas, Texas 75230 7,855,121 34.36%

Larry H. Kenner(3) 437,760 1.91%

Kelly Tacke(4) 55,121 *

W.D. Rosenberg, Jr. 213,624 *

William R. Thomas(2)(5) 250,331 1.09%

Frederick R. Meyer(6) 105,116 *

John H. Wilson(2) 1,250 *

Jerry D. Mallonee 6,000 *

A. Gary Shilling(7) 51,832 *

All directors and executive officers as a group (10
persons)(2)(3)(4)(5)(6)(7) 5,475,219 23.95%
</Table>

- ----------

* Beneficial ownership of less than 1% of the class is omitted.

(1) The information contained in this table with respect to common stock
ownership reflects "beneficial ownership" as defined in Rule 13d-3
under the Securities Exchange Act of 1934.

(2) Mr. Thomas is President and Chairman of the Board of Capital Southwest
Corporation and Capital Southwest Venture Corporation, both of which
are our principal shareholders. Mr. Wilson

is a member of the board of directors of Capital Southwest Corporation
and Capital Southwest Venture Corporation. Mr. Thomas and Mr. Wilson
may be deemed to share voting and investment power with respect to the
shares of common stock beneficially owned by Capital Southwest
Corporation and Capital Southwest Venture Corporation. Mr. Thomas and
Mr. Wilson each have disclaimed beneficial ownership of such shares.

(3) Includes an aggregate of 122,270 shares owned by Mr. Keener's spouse
and three daughters, over which shares he exercises voting and
investment power.

(4) Includes 2,720 restricted shares received under the Fiscal Year 2003
and 2002 Long Term Incentive Plans, 1,361 shares of which are
restricted until April 2, 2004, and 1,359 shares of which are
restricted until April 1, 2005. All 2,720 shares may be currently voted
by Ms. Tacke.

(5) Mr. Thomas has sole voting and investment power with respect to 113,282
shares personally held by Mr. Thomas. Mr. Thomas also has sole voting
and investment power with respect to 80,674 shares held by a family
partnership. Mr. Thomas is a trustee of certain trusts pursuant to
employee stock ownership plans for employees of Capital Southwest
Corporation and its wholly-owned portfolio companies owning 56,375
shares, with the power as one of two trustees to participate in the
voting of such shares. Under the rules and regulations of the SEC, Mr.
Thomas is deemed to be the beneficial owner of such 59,416 shares which
are included in the shares owned by Mr. Thomas.

(6) Includes 48,829 shares owned by a family partnership over which Mr.
Meyer exercises voting and investment power.

(7) Dr. Shilling is one of five members of an investment committee to
participate in the voting and investment decisions relating to 25,794
shares owned by clients of A. Gary Shilling & Co., Inc. Under the rules
and regulations of the SEC, Dr. Shilling is deemed to be the beneficial
owner of 25,794 shares which are included in the shares owned by Dr.
Shilling.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires our
directors and executive officers, and persons who own more than 10% of our
common stock, to file reports of holdings and transactions in our securities
with the SEC and to furnish us with copies of all such reports. Based solely
upon a review of the reports furnished to us with respect to the fiscal year
ended March 28, 2003, we believe that all SEC filing requirements applicable to
our directors and executive officers were satisfied.

PROPOSAL ONE: ELECTION OF DIRECTORS

At the annual meeting, eight directors will be elected by the
shareholders to serve until their successors have been duly elected and
qualified, or until the earliest of their death, resignation or retirement.

The persons named in the enclosed proxy will vote your shares as you
specify on the enclosed proxy. If you return your properly executed proxy but
fail to specify how you want your shares voted, the shares will be voted in
favor of the nominees listed below. The non-employee directors have proposed the
following nominees for election as directors at the annual meeting. Each of the
nominees is currently a member of the board of directors.

NOMINEES

LARRY H. KEENER, Director since 1995. Chief Executive Officer since
June 1997 and President since June 1994. Chief Operating Officer from June 1994
to June 1997. Division President from June 1989 to May 1994. Director from 1980
to May 1994. Age: 53.

JERRY D. MALLONEE. Retired from Arthur Andersen & Co. in December 1998
as the Tax Managing Partner of Pacific Northwest. Mr. Mallonee had been employed
by Arthur Andersen from February 1967 until his retirement. Mr. Mallonee is a
financial advisor for Carter Financial Management. Age: 62.

FREDERICK R. MEYER, Director since 1994. Chairman of the Board of
Aladdin Industries LLC since July 1985. President and Chief Executive Officer of
Aladdin Industries LLC from October 1995 to May 1999 and from May 1987 to
September 1994. President of Tyler Technologies, Inc. from July 1983 to December
1986. Director of SWS Group, Inc. and Westwood Holding Group. Age: 75.

LEE POSEY, Chairman of the board of directors since December 1977.
Chief Executive Officer from December 1977 to June 1997. President from December
1977 to December 1993. President of Redman Industries, Inc. from 1967 to 1977.
Age: 67.

WALTER D. ROSENBERG, JR., Director since 1977. Managed his personal
portfolio since June 1991. Chairman of the Board and Chief Executive Officer of
Duro Metal Manufacturing Company, Inc. from December 1957 to June 1991. Age: 76.

A. GARY SHILLING, Director since 1995. President of A. Gary Shilling &
Co., Inc. since 1978. Senior Vice President and Chief Economist of White, Weld &
Co., Inc. from 1972 to 1978. Director of Heartland Funds. Age: 66.

WILLIAM R. THOMAS, Director since 1982 pursuant to an agreement among
us, Capital Southwest Corporation and Capital Southwest Venture Corporation.
Chairman of the Board since 1982 and President since 1980 of Capital Southwest
Corporation. President of Capital Southwest Venture Corporation since 1980.
Director of Alamo Group, Inc. and Encore Wire Corporation. Age: 74.

JOHN H. WILSON, Director since 1994. President of U.S. Equity
Corporation since 1983. Director of Capital Southwest Corporation and Encore
Wire Corporation. Age: 60.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE
ELECTION OF DIRECTORS AS SET FORTH IN PROPOSAL ONE.

EXECUTIVE OFFICERS

Our executive officers serve at the discretion of the board of
directors and are appointed annually by the board of directors. Set forth below
are the names, ages and positions of our executive officers.

<Table>
<Caption>
NAME AGE POSITION
---- --- --------

Lee Posey 68 Chairman of the Board and Director
Larry H. Keener 53 President, Chief Executive Officer and Director
Kelly Tacke 45 Chief Financial Officer, Vice President-Finance and Secretary
</Table>

Information concerning the business experience of Messrs. Posey and
Keener is provided in "Proposal One: Election of Directors." Set forth below is
a description of the background of Ms. Tacke. There is no family relationship
between any of our directors or executive officers.

KELLY TACKE has served as Vice President-Finance and Chief Financial
Officer since October 1993, and as Secretary since March 1997. From August 1979
through September 1993, Ms. Tacke was employed by PriceWaterhouseCoopers LLP
where she most recently served as a Senior Audit Manager.

COMPENSATION OF EXECUTIVE OFFICERS

The following table summarizes the compensation paid by us for the
fiscal years ended March 28, 2003, March 29, 2002 and March 30, 2001 to the
Chief Executive Officer and the executive officers who received a total annual
salary and bonus in excess of $100,000 in fiscal year ended March 28, 2003.

SUMMARY COMPENSATION TABLE

<Table>
<Caption>
Long Term All Other
Annual Compensation(1) Compensation Compensation
-------------------------------- ------------ ------------
Name and Fiscal Restricted
Principal Location Year Salary Bonus Stock Awards
------------------ ------ ------ ----- ------------

Lee Posey 2003 $400,000 $ 0 -- $ 8,269
Chairman of the Board 2002 400,000 0 -- 6,624(2)
2001 400,000 0 -- 6,774(2)

Larry H. Keener 2003 200,000 200,000 -- 11,500(3)
President and Chief 2002 200,000 496,831 -- 11,100(3)
Executive Officer 2001 200,000 432,431 -- 11,250(3)

Kelly Tacke 2003 120,000 158,224 -- 5,500(5)
Chief Financial Officer, 2002 100,000 215,486 $27,888(4) 5,100(5)
Vice President-Finance 2001 100,000 123,552 20,671(4) 5,250(5)
and Secretary
</Table>

- ----------

(1) The named executive officers did not receive any annual compensation
not properly categorized as salary or bonus, except for certain
perquisites and other personal benefits which are not shown because the
aggregate incremental costs of these benefits to us for each officer
did not exceed the lesser of either $50,000 or 10% of the total of
annual salary and bonus reported for each such officer.

(2) Includes $5,500, $5,100 and $5,250 contributed in fiscal year 2003,
2002 and 2001, respectively, by us pursuant to the employee savings
plan and $2,769, $1,524 and $1,524 paid in fiscal year 2003, 2002 and
2001, respectively, by us as a car allowance.

(3) Includes $5,550, $5,100 and $5,250 contributed in fiscal year 2003,
2002 and 2001, respectively, by us pursuant to the employee savings
plan and $6,000 paid in fiscal year 2003, 2002 and 2001 by us as a car
allowance.

(4) Represents an aggregate of 2,720 restricted shares of common stock as
of March 28, 2003.

(5) Represents contributions by us pursuant to the employee savings plan.

COMPENSATION ARRANGEMENTS

Pursuant to the compensation agreement we entered into with Lee Posey,
our Chairman of the Board, if Mr. Posey provides a minimum of 100 days of
service per year, he will receive $400,000 per year for his services. If he
provides a minimum of 75 days of service, but less than 100 days of service, per
year, he will receive $300,000 per year for his services. In fiscal 2003, Mr.
Posey worked more than 100 days for the Company, and, accordingly, he received a
salary of $400,000. If the agreement terminates for any reason prior to March
27, 2007, Mr. Posey or his estate, as applicable, is entitled to receive a
payment equal to the lesser of (1) $1,000,000 or (2) $16,667 multiplied by the
remainder of 96 minus the number of months Mr. Posey provided services as an
employee under the agreement.

Section 162(m) of the Internal Revenue Code of 1986, as amended,
enacted in 1993, precludes a public corporation from taking a deduction in 1994
or subsequent years for compensation in excess of $1 million paid to its chief
executive officer or any of its four other highest-paid officers unless such
compensation is performance-based compensation as defined in Section 162(m) of
the Code. Our corporate bonus plan is a performance-based plan.

INDEMNIFICATION AGREEMENTS

We have entered into indemnification agreements with certain of our
officers and each of our directors, requiring us to indemnify such persons
against judgments, claims, damages, losses and expenses incurred as a result of
the fact that such officer or director, in his or her capacity as such, is made
or threatened to be made a party to any suit or proceeding, to the maximum
extent permitted by Florida law. The indemnification agreements provide for the
advancement of expenses to such officers and directors in connection with any
such suit or proceeding.

LONG-TERM INCENTIVE PLAN - AWARDS IN LAST FISCAL YEAR

Effective the 2000 fiscal year, we adopted a long term incentive plan.
We have also adopted such a plan for fiscal 2001, 2002 and 2003. Each plan has a
term of one year. All key employees and executive officers (excluding the
Chairman and the President) are eligible for consideration for grants under the
plan. Subject to their continued employment, the 2001-2003 plans provide that
plan participants are entitled to receive shares of our common stock in an
amount equivalent to 10% of the cash compensation that each participant received
during the applicable fiscal year, but not in excess of $40,000. The shares do
not vest for three years, but the recipients of stock grants under this plan
have the right to currently vote such shares. Accordingly, a total of 97.206
shares awarded under the fiscal year 2000 plan have vested at the end of fiscal
2003. For fiscal 2001, 2002 and 2003, shares awarded under the plan were
approximately 187,000. 214,000 and 145,000, respectively. If participants do not
meet the

vesting requirements because their employment is terminated, shares granted to
them will be forfeited and returned to us.

We have not adopted a long term incentive plan for fiscal 2004.

The following table shows the number of shares awarded under the Plan
during the two preceding fiscal years to the only corporate officer who was a
plan participant.

<Table>
<Caption>
PERFORMANCE
NUMBER OF SHARES OR OTHER PERIOD UNTIL
NAME OF COMMON STOCK MATURATION OR PAYOUT
- ----------------------------------------- --------------------------------- -----------------------------------

Kelly Tacke 1,361 April 2, 2004 (1)
Chief Financial Officer, Vice 1,359 April 1, 2005 (1)
President-Finance and Secretary
</Table>

PERFORMANCE GRAPH

The following graph shows a comparison of cumulative total returns for
us, the Standard & Poor's MidCap 400 Composite Stock Index and our peer group,
assuming the investment of $100 on July 31, 1995 (the date our common stock
began trading) and the reinvestment of dividends. The companies in our peer
group are as follows: Cavalier Homes, Inc., Champion Enterprises, Inc., Clayton
Homes, Inc., Fleetwood Enterprises, Inc., Liberty Homes, Inc., Oakwood Homes
Corporation and Skyline Corporation.

(PERFORMANCE GRAPH)

<Table>
<Caption>
- -------------------------------------------------------------------------------------
1998 1999 2000 2001 2002 2003
- -------------------------------------------------------------------------------------

Palm Harbor Homes, Inc. 100 74 52 51 71 48
S & P MidCap 400 Index 100 100 139 129 153 117
Custom Peer Group 100 63 37 36 54 31
</Table>

The foregoing price performance comparisons shall not be deemed
incorporated by reference by any general statement incorporation by reference of
this proxy statement into any filing under the Securities Act or Securities
Exchange Act, except to the extent that we specifically incorporate this graph
by reference, and shall not otherwise be deemed filed under those Acts.

There can be no assurance that our share performance will continue into
the future with the same or similar trends depicted in the graph above. We will
not make or endorse any predictions as to future share performance.

PROPOSAL TWO: RATIFICATION OF INDEPENDENT AUDITORS

The shareholders are urged to ratify the appointment by the board of
directors of Ernst & Young LLP as independent auditors for the fiscal year
ending March 26, 2004. Ernst & Young LLP has served as our independent auditors
since our inception and is familiar with our affairs and financial procedures.

Aggregate Ernst & Young fees for the fiscal year ended March 29, 2002
and March 28, 2003 were:

<Table>
<Caption>
Fiscal 2002 Fiscal 2003
----------- -----------

Audit Fees............................................................. $290,000 $365,000
Audit Related Fees..................................................... $ 49,979 $ 46,147
Tax Fees............................................................... $ 22,887 $ 20,068
All Other Fees......................................................... $ 5,825(1) $ 0
</Table>

- ----------

(1) Business impact assessment.

The audit committee has considered whether the provision of these
services by Ernst & Young LLP is compatible with maintaining the principal
accountant's independence and has determined that such services have not
adversely affected Ernst & Young, LLP's independence.

A representative of Ernst & Young is expected to be present at the
annual meeting and will have an opportunity to make a statement, if he desires
to do so, and to respond to appropriate questions from shareholders.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THIS
PROPOSAL.

SHAREHOLDER PROPOSALS

Any shareholder who intends to present a proposal at the annual meeting
in the year 2004, and who wishes to have the proposal included in our proxy
statement and proxy for that meeting, must deliver the proposal to our corporate
secretary, Kelly Tacke, at 15303 Dallas Parkway, Suite 800, Addison, Texas 75001
by February 19, 2004. All proposals must meet the requirements set forth in the
rules and regulations of the SEC in order to be eligible for inclusion in the
proxy statement for that meeting.

Any shareholder who intends to bring business before the annual meeting
in the year 2004 in a form other than a shareholder proposal in accordance with
the preceding paragraph must give written notice to our corporate secretary at
the address set forth in the preceding paragraph on or before May 4, 2004.

ANNUAL REPORT

We have provided without charge a copy of the annual report to
shareholders for fiscal year ended March 28, 2003 to each person being solicited
by this proxy statement. UPON THE WRITTEN REQUEST BY ANY PERSON BEING SOLICITED
BY THIS PROXY STATEMENT, WE WILL PROVIDE WITHOUT CHARGE A COPY OF THE ANNUAL
REPORT ON FORM 10-K AS FILED WITH THE SEC (EXCLUDING EXHIBITS, FOR WHICH A
REASONABLE CHARGE SHALL BE IMPOSED). All requests should be directed to: Kelly
Tacke, Chief Financial Officer, Vice-President Finance and Secretary, at Palm
Harbor Homes, Inc., 15303 Dallas Parkway, Suite 800, Addison, Texas 75001. This
information is also available via the Internet at our world wide web site
(www.palmharbor.com) and the EDGAR version of such report (with exhibits) is
available at the SEC's world wide web site (www.sec.gov).

PALM HARBOR HOMES, INC.

AUDIT COMMITTEE CHARTER

PURPOSE

The Audit Committee (the "Audit Committee" or the "Committee") shall assist the
Board of Directors (the "Board") in fulfilling its oversight responsibilities to
shareholders, the investment community and others for monitoring (1) the quality
and integrity of the financial statements of the Company; (2) the independence,
qualification and performance of the Company's independent auditors; (3) the
Company's accounting and financial reporting processes; and (4) audits of the
Company's financial statements. The Audit Committee shall have the authority to
retain special legal, accounting or other consultants to advise the Audit
Committee. The Audit Committee may request any officer or employee of the
Company or the Company's outside counsel or independent auditors to attend a
meeting of the Audit Committee or to meet with any members of, or consultants
to, the Audit Committee.

ORGANIZATION

This charter governs the operations of the Audit Committee. The Audit Committee
shall review and reassess the adequacy of this charter annually and recommend
any proposed changes to the charter to the Board for approval. The Board will
appoint Committee members annually. The Board may remove Committee members at
any time with or without cause, by a majority vote. The Board will fill any
vacancy on the Committee. The Audit Committee shall be comprised of at least
three outside directors, each of whom is independent as determined in accordance
with the requirements of the Sarbanes-Oxley Act of 2002 ("Sarbanes"), NASDAQ,
the Securities Exchange Act of 1934, as amended, and the rules and regulations
of the Securities and Exchange Commission ("SEC"). Members of the Audit
Committee may not receive any compensation from the Company other than
directors' fees. All members of the Audit Committee must be financially
literate, and at least one member must be an "audit committee financial expert"
pursuant to Sarbanes and any SEC rules promulgated relating thereto. No
committee member may serve on the audit committee of more than two other public
companies without Board approval. The Audit Committee shall maintain minutes of
its meetings and report to the Board.

RESPONSIBILITIES AND PROCESSES

While the Audit Committee has the responsibilities and powers set forth in this
charter, it is not the duty of the Audit Committee to plan or conduct audits or
to determine that the Company's financial statements are complete and accurate
and are in accordance with generally accepted accounting principles. Management
is responsible for preparing the Company's financial statements and the
Company's independent auditors are responsible for auditing the annual financial
statements and for reviewing the unaudited interim financial statements. It is
also not the duty of the Audit Committee to conduct investigations to assure
compliance with laws and regulations and the Company's Code of Conduct and
Ethics.

The Audit Committee, in carrying out its responsibilities, believes this charter
should be reviewed periodically, in order to best react to changing conditions
and circumstances. The Audit Committee should take appropriate actions to ensure
a management environment for quality financial reporting, sound business risk
practices, and ethical behavior. The following shall be the principal duties and

responsibilities of the Audit Committee. These are set forth as a guide with the
understanding that the Audit Committee may supplement them as appropriate.

In carrying out its responsibilities, the Audit Committee shall:

1. Retain, subject to shareholder ratification, the independent auditors of the
Company to conduct the examination of the books and records of the Company and
its affiliates, and terminate any such engagement if circumstances warrant. The
independent auditors are ultimately accountable to, and shall report directly
to, the Audit Committee. The Audit Committee shall provide oversight of the work
of the independent auditors, including resolution of disagreements between
management and the independent auditors regarding financial reporting.

2. Pre-approve all audit services and, to the extent permitted by law, all
non-audit services provided by the independent auditors, as well as the fees and
terms for providing such services. The Audit Committee may delegate pre-approval
authority to a member of the Audit Committee. The decisions of any Audit
Committee member to whom pre-approval authority is delegated must be presented
to the full Audit Committee at its next scheduled meeting. However, pre-approval
of non-audit services is not required if (i) the aggregate amount of non-audit
services is less than 5% of the total amount paid by the Company to the auditor
during the fiscal year in which the non-audit services are provided; (ii) such
services were not recognized by the Company as non-audit services at the time of
the engagement; and (iii) such services are promptly brought to the attention of
the Committee and, prior to completion of the audit, are approved by the
Committee or by one or more Committee members who have been delegated authority
to grant approvals.

3. At least annually, obtain and review a report by the independent auditors
describing: (i) the firm's internal quality-control procedures; (ii) any
material issues raised by the most recent internal quality-control review, or
peer review, of the firm, or by any inquiry or investigation by governmental or
professional authorities, within the preceding five years, respecting any
independent audits carried out by the firm and any steps taken to deal with any
such items; and (iii) all relationships between the independent auditor and the
Company.

4. Evaluate the performance of the Company's independent auditors and lead audit
partner, and report its conclusions to the full Board.

5. Meet with the Company's independent auditors and management to review the
scope of the proposed annual audit (and related quarterly reviews), the key
audit procedures to be followed and, at the conclusion of the audit, review the
principal audit findings including any comments or recommendations of the
Company's independent auditors.

6. Obtain assurance from the Company's independent auditors that it has complied
with its obligation to report fraud that has come to their attention in
connection with its audit of the financial statements of the Company.

7. Discuss the Company's annual audited financial statements and unaudited
quarterly financial statements with management and the independent auditors,
including management's discussion and analysis of financial condition and
results of operations. Discuss other matters with the Company's independent
auditors as required by the SEC and, if the financial statements are acceptable,
recommend that the audited financial statements be included in the Company's
Form 10-K.

8. While the fundamental responsibility for the Company's financial statements
and disclosures rests with management and the independent auditors, the
Committee will review: (i) major issues

regarding accounting principles and financial statement presentations, including
any significant changes in the Company's selection or application of accounting
principles, and major issues as to the adequacy of the Company's internal
controls and any special audit steps adopted in light of material control
deficiencies; (ii) analyses prepared by management or the independent auditors
setting forth significant financial reporting issues and judgments made in
connection with the preparation of the financial statements, including analyses
of the effects of alternative GAAP methods on the financial statements and the
treatment preferred by the independent auditors; (iii) the effect of regulatory
and accounting initiatives, as well as off-balance sheet structures, on the
financial statements of the Company; and (iv) earnings press releases (paying
particular attention to any use of pro-forma information and non-GAAP
information).

9. Approve the content of the report of the Audit Committee required by the SEC
to be included in the Company's annual proxy statement.

10. Meet, at least annually, with management to discuss, as appropriate,
significant accounting accruals, estimates and reserves; litigation matters;
management's representations to the independent auditors; new or proposed
regulatory accounting and reporting rules; any significant off-balance sheet
transactions and special purpose entities; and any significant financial
reporting issues or judgments disputed with the Company's independent auditors.

11. At least annually, receive from and discuss with the independent auditors
and management, separately or together as determined by the Committee, a report
on (i) all critical accounting policies and practices to be used; (ii) all
alternative treatments of financial information within generally accepted
accounting principles that have been discussed with management of the Company,
the ramifications of the use of such alternative disclosures and treatments, and
the treatment preferred by the independent auditors; and (iii) other material
written communications between the independent auditors and management of the
Company, such as any management letter or schedule of unadjusted audit
differences.

12. Review quarterly with the Company's CEO and CFO (i) any significant
deficiencies in the design or operation of internal controls which could
adversely affect the Company's ability to record, process, summarize and report
financial data; (ii) any material weakness in the Company's internal controls;
and (iii) any fraud, whether or not material, involving management or other
employees who have a significant role in the Company's internal controls.

13. Review annually with management and the independent auditors (i) the
internal control report contained in the Company's Annual Report on Form 10-K
regarding management's assessment of the effectiveness of the internal control
structure and procedures of the Company for financial reporting; and (ii) the
attestation and report of the independent auditors regarding management's
assessment of internal controls.

14. Discuss with the Company's independent auditors and management information
relating to the auditors' judgments about the quality, not just the
acceptability, of the Company's accounting principles. Also, the Committee shall
discuss the results of the annual audit and any other matters that may be
required to be communicated to the Audit Committee by the Company's independent
auditors under generally accepted auditing standards.

15. At least quarterly, discuss separately with the Company's independent
auditors and management the adequacy and effectiveness of the Company's internal
accounting and financial controls, and elicit any recommendations for
improvement.

16. Review major changes to the Company's accounting principles and practices as
suggested by the independent auditors, internal auditors or management.

17. At least annually, receive reports from the Company's independent auditors
regarding the auditors' independence from management and the Company (including
the identification of all relationships between the independent auditors and the
Company), discuss such reports with the independent auditors, consider whether
the provision of non-audit services by the independent auditors is compatible
with the auditors' independence, and, if determined by the Audit Committee,
recommend that the Board take action to satisfy itself of the independence of
the auditors.

18. The Company may not hire employees and former employees of the independent
auditors without Committee consent. The Committee will review all requests for
waiver of such policy.

19. Provide sufficient opportunity at its meetings to meet separately in
executive session with the Company's independent auditors and members of
management. Among the items to be discussed with the Company's independent
auditors are (i) the independent auditors' evaluation of the Company's financial
and accounting personnel; (ii) the cooperation that the independent auditors
received during the course of its audit; (iii) any management letter provided by
the independent auditors and management's response; and (iv) any other matters
the Audit Committee may determine from time to time.

20. Report regularly to the Board.

21. Establish procedures for (i) the receipt, retention, and treatment of
complaints received by the Company regarding accounting, internal accounting
controls, or auditing matters; and (ii) the confidential, anonymous submission
by employees of the Company of concerns regarding questionable accounting or
auditing matters.

22. As Committee determines necessary to carry out its duties, obtain advice and
assistance from outside advisors, including the Company's legal, accounting or
other advisors.

ANNUAL MEETING OF SHAREHOLDERS OF

PALM HARBOR HOMES, INC.

JULY 23, 2003

PROOF # 1

Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.

o Please detach and mail in the envelope provided. o

- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS AND
"FOR" PROPOSAL 2.

PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR
VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
- --------------------------------------------------------------------------------

1. Election of Directors:

NOMINEES:
[ ] FOR ALL NOMINEES O Larry H. Keener
O Jerry D. Mallonee
[ ] WITHHOLD AUTHORITY O Frederick R. Meyer
FOR ALL NOMINEES O Lee Posey
O Walter D. Rosenberg, Jr.
[ ] FOR ALL EXCEPT O A. Gary Shilling
(See instructions O William R. Thomas
below) O John H. Wilson

INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark
"FOR ALL EXCEPT" and fill in the circle next to each nominee you
wish to withhold, as shown here: [X]
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

To change the address on your account, please check the box at right and
indicate your new address in the address space above. Please note that changes
to the registered name(s) on the account may not be submitted via this
method.[ ]
- --------------------------------------------------------------------------------
FOR AGAINST ABSTAIN

2. RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP [ ] [ ] [ ]
AS THE INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING
MARCH 26, 2004.

3. In their discretion, the Proxies are authorized to vote
upon such other matters as may properly come before the
meeting or any adjournments thereof.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND WILL BE VOTED IN
ACCORDANCE WITH THE SPECIFICATIONS MADE ABOVE. IF A CHOICE IS NOT INDICATED WITH
RESPECT TO ITEMS (1) AND (2) ABOVE, THIS PROXY WILL BE VOTED "FOR" SUCH
PROPOSALS. THIS PROXY IS REVOCABLE AT ANY TIME BEFORE IT IS EXERCISED.

PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.

Signature of Shareholder ____________ Date: ____________

NOTE: Please sign exactly as your name or names appear on this Proxy. When
shares are held jointly, each holder should sign. When signing as
executor, administrator, attorney, trustee or guardian, please give
full title as such. If the signer is a corporation, please sign full
corporate name by duly authorized officer, giving full title as such.
If signer is a partnership, please sign in partnership name by
authorized person.

PROOF # 1

PALM HARBOR HOMES, INC.

The undersigned shareholder of Palm Harbor Homes, Inc. does hereby nominate,
constitute and appoint Kelly Tacke and Colleen Rogers, or either one of them, as
Proxies, each with full power to appoint her substitute, to represent and vote
all of the shares of Common Stock of Palm Harbor Homes, Inc. held of record by
the undersigned at the Annual Meeting of shareholders to be held at 10:00 a.m.
Dallas time on July 23, 2003 at the Company Headquarters, 15303 Dallas Parkway,
Suite 900, Addison, Texas, 75001, and at any adjournments thereof, as follows:

(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)

ANNUAL MEETING OF SHAREHOLDERS OF

PALM HARBOR HOMES, INC.

JULY 23, 2003

PROOF # 2
-------------------------
PROXY VOTING INSTRUCTIONS
-------------------------

MAIL - Date, sign and mail your proxy card in the
envelope provided as soon as possible.
------------------------
- OR - COMPANY NUMBER
------------------------
TELEPHONE - Call toll-free 1-800-PROXIES (776-9437) ACCOUNT NUMBER
from any touch-tone telephone and follow the ------------------------
instructions. Have your control number and proxy CONTROL NUMBER
card available when you call. ------------------------

- OR -

INTERNET - Access "WWW.VOTEPROXY.COM" and follow the
on-screen instructions. Have your control number
available when you access the web page.

o Please detach and mail in the envelope provided IF you are not voting via o
telephone or the Internet.

- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS AND
"FOR" PROPOSAL 2.

PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR
VOTE IN BLUE OR BLACK INK AS SHOWN HERE [x]
- --------------------------------------------------------------------------------

1. Election of Directors:

INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark
"FOR ALL EXCEPT" and fill in the circle next to each nominee you wish to
withhold, as shown here: [X]
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
To change the address on your account, please check the box at right and
indicate your new address in the address space above. Please note that changes
to the registered name(s) on the account may not be submitted via this
method. [ ]

- --------------------------------------------------------------------------------
FOR AGAINST ABSTAIN
2. RATIFICATION OF THE APPOINTMENT OF ERNST & [ ] [ ] [ ]
YOUNG LLP AS THE INDEPENDENT AUDITORS FOR THE
FISCAL YEAR ENDING MARCH 26, 2004.

3. In their discretion, the Proxies are authorized to vote upon such other
matters as may properly come before the meeting or any adjournments thereof.

PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY IN
THE ENCLOSED ENVELOPE.

Signature of Shareholder ____________ Date: ____________