Unassociated Document

0001144204-07-039192.txt : 20070731 0001144204-07-039192.hdr.sgml : 20070731 20070731130259 ACCESSION NUMBER: 0001144204-07-039192 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20070731 DATE AS OF CHANGE: 20070731 GROUP MEMBERS: CHANNEL PARTNERSHIP II, L.P. GROUP MEMBERS: JOSHUA LANDES GROUP MEMBERS: NELSON OBUS GROUP MEMBERS: WYNNEFIELD CAPITAL MANAGEMENT, LLC GROUP MEMBERS: WYNNEFIELD CAPITAL, INC. GROUP MEMBERS: WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P. I GROUP MEMBERS: WYNNEFIELD SMALL CAP VALUE OFFSHORE FUND, LTD. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CROWN CRAFTS INC CENTRAL INDEX KEY: 0000025895 STANDARD INDUSTRIAL CLASSIFICATION: BROADWOVEN FABRIC MILLS, COTTON [2211] IRS NUMBER: 580678148 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-17391 FILM NUMBER: 071011944 BUSINESS ADDRESS: STREET 1: 916 SOUTH BURNSIDE AVENUE CITY: GONZALES STATE: LA ZIP: 70737 BUSINESS PHONE: 225-647-9100 MAIL ADDRESS: STREET 1: PO BOX 1028 CITY: GONZALES STATE: LA ZIP: 70707 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: WYNNEFIELD PARTNERS SMALL CAP VALUE LP CENTRAL INDEX KEY: 0000899083 IRS NUMBER: 133688497 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: ONE PENN PLAZA STREET 2: SUITE 4720 CITY: NEW YORK STATE: NY ZIP: 10119 BUSINESS PHONE: 2127600814 MAIL ADDRESS: STREET 1: ONE PENN PLAZA STREET 2: SUITE 4720 CITY: NEW YORK STATE: NY ZIP: 10119 SC 13D/A 1 v082373_sc13da.htm Unassociated Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Amendment No. 5)

Under the Securities Exchange Act of 1934

Crown Crafts, Inc.

(Name of Issuer)

Common Stock, $0.01 par value per share

(Title of Class of Securities)

228309100

(CUSIP Number)

Wynnefield Partners Small Cap Value, L.P.

450 Seventh Avenue, Suite 509

New York, New York 10123

Attention: Mr. Nelson Obus

Copy to:

Jeffrey S. Tullman, Esq.

Kane Kessler, P.C.

1350 Avenue of the Americas, 26^th Floor

New York, New York 10019

(212) 541-6222

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

July 30, 2007

(Date of Event which requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o.

CUSIP No. 228309100

13D/A

Page 2 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Wynnefield Partners Small Cap Value, L.P. 13-3688497
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 522,600 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 522,600 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 522,600 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.9 %
14	TYPE OF REPORTING PERSON (See Instructions) PN

CUSIP No. 228309100

13D/A

Page 3 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Wynnefield Partners Small Cap Value, L.P. I 13-3953291
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 594,000 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 594,000 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 594,000 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.9 %
14	TYPE OF REPORTING PERSON (See Instructions) PN

CUSIP No. 228309100

13D/A

Page 4 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Wynnefield Small Cap Value Offshore Fund, Ltd. (No IRS Identification No.)
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 335,135 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 335,135 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 335,135 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.3 %
14	TYPE OF REPORTING PERSON (See Instructions) CO

CUSIP No. 228309100

13D/A

Page 5 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Wynnefield Capital Management, LLC 13-4018186
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION New York
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 1,116,600 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 1,116,600 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,116,600 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 11.2 %
14	TYPE OF REPORTING PERSON (See Instructions) OO (Limited Liability Company)

CUSIP No. 228309100

13D/A

Page 6 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Wynnefield Capital, Inc. 13-3688495
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 335,135 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 335,135 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 335,135 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.4 %
14	TYPE OF REPORTING PERSON (See Instructions) CO

CUSIP No. 228309100

13D/A

Page 7 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Channel Partnership II, L.P. 22-3215653
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION New York
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 11,600 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 11,600 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 11,600 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.1 %
14	TYPE OF REPORTING PERSON (See Instructions) PN

CUSIP No. 228309100

13D/A

Page 8 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Nelson Obus
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) N/A
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 1,463,335 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 1,463,335 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,463,335 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 14.6%
14	TYPE OF REPORTING PERSON (See Instructions) IN

CUSIP No. 228309100

13D/A

Page 9 of 11 Pages

1	NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only) Joshua Landes
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ࿇ (b)࿇
3	SEC USE ONLY
4	SOURCE OF FUNDS (See Instructions) N/A
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) ࿇
6	CITIZENSHIP OR PLACE OF ORGANIZATION United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER 1,451,735 (See Item 5)
		8	SHARED VOTING POWER 0
		9	SOLE DISPOSITIVE POWER 1,451,735 (See Item 5)
		10	SHARED DISPOSITIVE POWER 0
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,451,735 (See Item 5)
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions) ࿇
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 14.5%
14	TYPE OF REPORTING PERSON (See Instructions) IN

CUSIP No. 228309100

13D/A

Page 10 of 11 Pages

This Amendment No. 5 (the “Amendment”) amends the Statement of Beneficial Ownership on Schedule 13D originally filed with the Securities and Exchange Commission on May 17, 2002, as further amended by Amendment No. 1 filed on January 28, 2003, and as further amended by Amendment No. 2 filed on February 20, 2003, and as further amended by Amendment No. 3 filed on May 12, 2003 and as further amended by Amendment No. 4 filed on June 28, 2007 (collectively, the “Schedule 13D”) by the Wynnefield Reporting Persons with respect to shares of common stock, par value $1.00 (the “Common Shares”) of Crown Crafts, Inc. (the “Issuer”), whose principal executive offices are located at 916 South Burnside Avenue, Gonzales, Louisiana 70737. Unless specifically amended hereby, the disclosures set forth in the Schedule 13D shall remain unchanged. Capitalized terms used but not otherwise defined herein shall have the meanings set forth in the Schedule 13D.

Item 4. Purpose of Transaction.

Item 4 of the Schedule 13D is hereby amended by the addition of the following:

On July 30, 2007, the Wynnefield Reporting Persons issued a press release (the “Press Release”) containing a letter sent to the Issuer’s board of directors (the “Board”), offering a compromise agreement allowing for an amicable resolution of the proxy contest currently underway.

Under the proposal delivered to the Board, the Wynnefield Reporting Persons have offered to withdraw its proxy campaign to replace two of the seven incumbent directors, upon the conditions that the Issuer:

·	Expand the Board from seven members to nine members;

·	Elect the Wynnefield Reporting Persons’ nominees, Messrs. Wasserman and Obus (the “Nominees”), to fill the two new seats;

·	Pay non-employee directors half of their current cash compensation, which averages more than $40,000 per director, in restricted stock;

·	Form a nominating and governance committee immediately, with one of the Nominees as a member;

Form a strategic planning committee immediately, with E. Randall Chestnut as one of its members and one of the Nominees as another member, with the intent to hire a qualified independent consultant to assist management and the Board in determining a future strategic plan and aligning future capital allocations to fulfill the agreed upon strategic plan; and

·	Commit to putting to a stockholder vote at the 2008 Annual Meeting, and support a binding resolution to de-classify the Board.

Should the Issuer reject the Wynnefield Reporting Persons’ compromise agreement, the Wynnefield Reporting Persons’ shall vigorously press its campaign to elect the Nominees at the Issuer’s annual meeting of stockholders and let the Issuer’s stockholders determine the outcome.

A copy of the Press Release is filed herewith and attached hereto as Exhibit 4 and is incorporated herein by reference. Any descriptions herein of the Press Release and the Wynnefield Reporting Persons’ letter dated July 30, 2007 are qualified in their entirety by reference to the attached Exhibit 4.

Other than as set forth in this Item 4, the Wynnefield Reporting Persons do not have any current plans, proposals or negotiations that relate to or would result in any of the matters referred to in paragraphs (a) through (j) of Item 4 of the Schedule 13D. The Wynnefield Reporting Persons intend to review their investment in the Issuer on a continuing basis, and to the extent permitted by law, may seek to engage in discussions with other stockholders and/or with management and the board of directors of the Issuer concerning the business, operations or future plans of the Issuer. Depending on various factors including, without limitation, the Issuer’s financial position, the price levels of the Common Shares, conditions in the securities markets and general economic and industry conditions, the Wynnefield Reporting Persons may, in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, purchasing additional Common Shares, selling Common Shares, engaging in short selling of or any hedging or similar transaction with respect to the Common Shares, taking any other action with respect to the Issuer or any of its securities in any manner permitted by law or changing its intention with respect to any and all matters referred to in paragraphs (a) through (j) of Item 4.

Item 7. Material to be Filed as Exhibits.

Item 7 of the Schedule 13D is hereby amended to including the following:

Exhibit 4

Press Release dated July 30, 2007

CUSIP No. 228309100

13D/A

Page 11 of 11 Pages

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Schedule 13D is true, complete and correct.

Date: July 30, 2007


	WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P.

	By:	Wynnefield Capital Management, LLC, General Partner

	By:	/s/ Nelson Obus
		Nelson Obus, Co-Managing Member


	WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P. I

	By:	Wynnefield Capital Management, LLC, General Partner

	By:	/s/ Nelson Obus
		Nelson Obus, Co-Managing Member


	WYNNEFIELD SMALL CAP VALUE OFFSHORE FUND, LTD.

	By:	Wynnefield Capital, Inc.

	By:	/s/ Nelson Obus
		Nelson Obus, President


	CHANNEL PARTNERSHIP II, L.P.

	By:	/s/ Nelson Obus
		Nelson Obus, General Partner


	WYNNEFIELD CAPITAL MANAGEMENT, LLC

	By:	/s/ Nelson Obus
		Nelson Obus, Co-Managing Member


	WYNNEFIELD CAPITAL, INC.

	By:	/s/ Nelson Obus
		Nelson Obus, President


		/s/ Nelson Obus
		Nelson Obus, Individually


		/s/ Joshua H. Landes
		Joshua H. Landes, Individually

EX-99.4 2 v082373_ex99-4.htm Unassociated Document

PRESS RELEASE

FOR IMMEDIATE RELEASE

CONTACT:

Eric Berman

Joseph Kuo

of Kekst and Company

212-521-4800

WYNNEFIELD GROUP OFFERS COMPROMISE AGREEMENT

TO CROWN CRAFTS BOARD FOR AMICABLE RESOLUTION OF PROXY CONTEST

-- Largest Stockholder in Crown Crafts Reiterates Commitment to Create Shareholder Value --

NEW YORK, NY, July 30, 2007 - The Wynnefield Group, the largest shareholder in Crown Crafts Inc. (NASDAQ: CRWS), today released a letter sent to the Board of Directors of Crown Crafts, offering a compromise agreement allowing for an amicable resolution of the proxy contest currently underway.

Wynnefield, a long-term investor in Crown Crafts, also reiterated its commitment to continue its campaign to elect two of its nominees to the Board, should this offer of a compromise agreement be rejected. Full text of Wynnefield’s letter follows:

July 30, 2007

VIA FACSIMILE AND FEDERAL EXPRESS

Board of Directors

c/o E. Randall Chestnut, Chairman, President

and Chief Executive Officer

Crown Crafts, Inc.

916 South Burnside Avenue

Gonzales, Louisiana 70737

Re: Crown Crafts, Inc. (the “Company”) 2007 Annual Meeting

Gentlemen:

As you know, the Wynnefield Group, as Crown Crafts’s largest stockholder, has long sought full voting representation on the Company’s Board of Directors (“Board”) in order to provide the shareholders’ point of view in developing a long-term strategic vision for the Company. The Board’s steadfast refusal to honor our request left the Wynnefield Group with no alternative but to commence its current proxy solicitation to elect two members to Crown Crafts Board. The election of our nominees, Messrs. Nelson Obus and Frederick G. Wasserman, will provide the Board and the Company’s stockholders experienced, independent Board members who serve with distinction on other boards and are committed to working constructively with the other Board members to develop a long-term strategic and business plan and implement best practices of corporate governance in order to enhance shareholder value.

A number of the Company’s significant shareholders who support our efforts have indicated that they would prefer to see this matter resolved amicably, if possible. In that spirit, and consistent with our history of cooperation and support of the Company, we submit to the Board an offer of compromise to end the proxy contest, which we never sought, but were compelled to undertake because of the Board’s refusal to work cooperatively with us to address the critical issues facing Crown Crafts today.

We will agree to drop our opposition to the re-election of William T. Deyo, Jr. and Steven E. Fox as directors of the Company, provided that the Company agrees to:

(i) immediately increase the size of the current Board from seven (7) members to nine (9) members;

(ii) elect Nelson Obus and Frederick G. Wasserman as directors to fill the vacancies thereby created;

(iii) form a nominating and governance committee immediately, with either Nelson Obus or Frederick G. Wasserman as one of the members;

(iv) form a strategic planning committee immediately, with E. Randall Chestnut as one of the members and either Nelson Obus or Frederick G. Wasserman as one of other members, with the intention of hiring a qualified independent consultant to assist management and the Board in determining a future strategic path and aligning future capital allocations to fulfill the agreed upon strategic plan;

(v) commit to putting to a stockholder vote at the 2008 Annual Meeting of stockholders, and supporting, a binding resolution to de-classify the Board; and

(vi) amend the non-employee director fee structure to provide that the cash fees paid to non-employee directors, which currently consist of payments of $20,000 per year, plus $2,500 for each Board meeting attended, $2,000 for each committee meeting held not in conjunction with a Board meeting, plus $2,500 for travel time, be paid 50% in cash and 50% in restricted stock of the Company.

We believe that these changes reflect current best practice in the area of corporate governance. Furthermore, amending the nature of the cash portion of the non-employee director fee structure will not only more than offset the cash cost of two additional directors, it will more closely align the financial interests of directors with those of the shareholders in accordance with best practice in director compensation. Our nominees have accepted and are committed to implementing this compensation arrangement, if our proposal is accepted by the Company.

We believe this proposal to be in the best interests of all concerned parties. The Company would gain the benefit of new directors, who are highly qualified, experienced, effective businessmen who have a history of successful service on other boards and whose background and skills and fresh view point will be an enormous asset to the Company. Stockholders would gain two members of the Board directly representing their interests. As we have demonstrated in our past dealings with the Company, we are confident that our nominees will be able to work constructively with the other Board members to address the many challenges facing the Company. Upon Frederick G. Wasserman’s election to the Board, he will resign one of his other public board memberships in order to devote the attention necessary to fulfill his duties and responsibilities to Crown Crafts.

We urge your serious consideration of our offer and look forward to your prompt response. However, please do not misconstrue the good faith intent of our initiative or under-estimate our resolve in this matter. Should the Company reject our proposal, we shall vigorously press our campaign to elect our nominees at the Company’s annual meeting of stockholders and let the Company’s shareholders determine the outcome.

Sincerely,

Wynnefield Partners Small Cap Value, L.P.,

By: Wynnefield Capital Management, LLC, its

General Partner

/s/ Nelson Obus

By: Nelson Obus, Co-Managing Member

ADDITIONAL INFORMATION:

Shareholders are advised to read the Wynnefield Group's definitive proxy statement, which contains important information. Shareholders may obtain a free copy of the proxy statement and other documents filed by the Wynnefield Group with the SEC at the SEC’s Internet website at www.sec.gov. The proxy statement, a proxy card, and other documents may also be obtained free of charge from the Wynnefield Group's proxy solicitor or from the Wynnefield Group by request to:

Lawrence E. Dennedy

Daniel M. Sullivan

MacKenzie Partners, Inc.

105 Madison Avenue

New York, NY 10016

Phone: (800) 322-2885

Nelson Obus

The Wynnefield Group

450 Seventh Avenue, Suite 509

Phone: (212) 760-0134

If you have lost your proxy card from the Wynnefield Group, or did not receive one, you may obtain another proxy statement and card by contacting MacKenzie Partners, Inc. or The Wynnefield Group at the phone numbers listed above.

ABOUT THE WYNNEFIELD GROUP:

The Wynnefield Group is Crown Crafts’ largest shareholder, holding 14.6% of the company’s outstanding common stock. Wynnefield is a long-term investor in Crown Crafts, having first invested in the company about eight years ago. The Wynnefield Group includes several affiliates of Wynnefield Capital, Inc. (WCI), a value investor specializing in U.S. small cap situations that have company- or industry-specific catalysts. WCI was established in 1992. Its founding partners, Nelson Obus and Joshua Landes, held senior research and institutional equity positions at Lazard Freres & Co. during the 1980s, and the initial Wynnefield investors included many of their colleagues at Lazard. The fund has grown to approximately $450 million under management. Nelson Obus currently serves on the board of directors of Layne Christensen Company (NASDAQ: LAYN), serving on its audit committee and compensation committee.

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