American Homestar Corporation Announces Senior Management Changes.

Business Editors

HOUSTON--(BUSINESS WIRE)--Aug. 21, 2000

American Homestar Corporation (Nasdaq/NM:HSTR) announced today the resignation of Laurence A. Dawson, Jr., as Chief Executive Officer, President and a Director of the Company. The Company also announced that Finis F. Teeter will remain as the non-executive Chairman of the Board of the Company, but will cease to have any operating responsibilities.

The Company further announced that Dale V. Kesler, a current director of the Company, will serve as interim Chief Executive Officer and President of the Company until such time as a successor is selected. The Company has retained the executive search firm of Spencer Stuart to identify potential Chief Executive Officer/President candidates, and the Board of Directors of the Company has formed a Search Committee to evaluate such candidates.

Commenting on these developments, Jack McDonald, a director of the Company and spokesman for the Board, said, "Lad Dawson and Buck Teeter have provided focused and effective leadership during a period of unprecedented growth for the Company and have worked with great intensity to posture the Company for success during admittedly challenging times for the entire industry. We wish Mr. Dawson the best in his future pursuits, and look forward to Mr. Teeter's continued involvement as the non-executive Chairman of the Board of the Company."

Also commenting, interim Chief Executive Officer and President Dale Kesler said, "I have worked closely with the senior management team of this Company since becoming a director and can say that they and I are committed to returning the Company to profitability in the shortest possible time frame. We have already taken many definitive steps in that regard and will take whatever further actions are necessary in a prudent and timely fashion."

American Homestar is one of the leading vertically integrated manufactured housing companies. The Company currently operates 10 manufacturing plants, 109 Company-owned retail sales centers, 11 joint venture retail sales centers and serves 60 retail franchisees and over 300 independent retail locations in 28 states. The Company also provides retail financing through its new finance affiliate, Homestar 21, LLC and provides insurance and transportation services to its customers.

This press release may contain certain forward-looking statements and information based on the beliefs of the Company's management as well as assumptions made by, and information currently available to, the Company's management. Words like "anticipate," "believe," "estimate," "should," "expect," and similar expressions used in this press release are intended to identify forward-looking statements. Such statements reflect the current views of the Company with respect to future events and are subject to certain risks, uncertainties, and assumptions, including the risk factors described in the Company's most recently filed registration statement and Form 10-K. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual events or results may vary from those described herein as anticipated, expected, believed, or estimated.

For more information about the Company, visit its Website at www.americanhomestar.com