<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 13, 2000
-----------------------------
Crown Crafts, Inc.
- ------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Georgia 1-7604 58-0678148
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(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) Number)
1600 RiverEdge Parkway, Suite 200, Atlanta, Georgia 30328
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (770) 644-6400
---------------------------
<PAGE> 2
Item 5. Other Events.
Crown Crafts, Inc. (the "Company") announced today that it has entered
into amendments (collectively, the "Amendments") to its credit agreements with
its lenders which, among other things, extend the maturity dates of its bank
facilities through June 4, 2000.
The description of the Amendments contained herein is qualified in its
entirety by reference to the terms of the Amendments, forms of which are
attached hereto as Exhibits 10.1, 10.2 and 10.3 and incorporated herein by this
reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits. The following is a list of the Exhibits attached
hereto:
Exhibit No. 10.1 Amendment No. 2 to Bank of America Revolving
Credit Agreement
Exhibit No. 10.2 Amendment No. 2 to Wachovia Bank Revolving
Credit Agreement
Exhibit No. 10.3 Amendment of The Prudential Insurance Company
of America 1995 Note Agreement
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CROWN CRAFTS, INC.
By: /s/ David S. Fraser
------------------------------------------------
Name: David S. Fraser
-----------------------------------------
Title: Vice President, Chief Financial Officer
----------------------------------------
Dated: March 13, 2000
<PAGE> 1
EXHIBIT 10.1
AMENDMENT NO. 2 TO REVOLVING CREDIT AGREEMENT
THIS AMENDMENT NO. 2 TO REVOLVING CREDIT AGREEMENT (this "Amendment")
is dated effective as of March 13, 2000, among CROWN CRAFTS, INC. (the
"Borrower") and BANK OF AMERICA, N.A. (the "Lender");
W I T N E S S E T H:
WHEREAS, the Borrower and the Lender executed and delivered that
certain Revolving Credit Agreement, dated as of August 9, 1999, as amended by
Amendment No. 1 to Revolving Credit Agreement dated as of February 23, 2000 (as
so amended, the "Credit Agreement");
WHEREAS, the Borrower has requested and the Lender has agreed to
certain amendments to certain provisions in the Credit Agreement, subject to the
terms and conditions hereof;
NOW, THEREFORE, for and in consideration of the above premises and
other good and valuable consideration, the receipt and sufficiency of which
hereby is acknowledged by the parties hereto, the Borrower and the Lender hereby
covenant and agree as follows:
1. Definitions. Unless otherwise specifically defined herein,
each term used herein which is defined in the Credit Agreement shall have the
meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall from and after the date hereof refer to
the Credit Agreement as amended hereby.
2. Amendments to Credit Agreement.
(a) Each of the following definitions contained in Section 1.1 of
the Credit Agreement is amended and restated in its entirety in alphabetical
order as follows:
"Revolving A Credit Termination Date" means (i) June
4, 2000 or (ii) such earlier date of termination of Lender's
obligations pursuant to Section 9.1 upon the occurrence of an
Event of Default, or (iii) such date as the Borrower may
permanently terminate the Revolving A Credit Facility by
payment in full of all Revolving A Credit Outstandings and
cancellation of the Revolving A Credit Commitment pursuant to
Section 2.3 hereof.
"Revolving B Credit Termination Date" means (i) June
4, 2000 or (ii) such earlier date of termination of Lender's
obligations pursuant to Section 9.1 upon the occurrence of an
Event of Default, or (iii) such date as the Borrower may
<PAGE> 2
permanently terminate the Revolving B Credit Facility by
payment in full of all Revolving B Credit Outstandings and
cancellation of the Revolving B Credit Commitment pursuant to
Section 2.3 hereof.
(b) Section 8.1(a) is amended and restated in its entirety as
follows:
(a) Consolidated Net Worth. Permit Consolidated Net Worth
at any time to be less than (i) $75,000,000 from the Closing
Date through the end of the fiscal month of the Borrower
ending February 27, 2000; (ii) $70,000,000 from February 28,
2000 to the last day of the fiscal quarter of the Borrower
ending April 2, 2000 and (iii) as at the last day of each
succeeding fiscal quarter of the Borrower after the fiscal
quarter of the Borrower ending April 2, 2000 and until (but
excluding) the last day of the next following fiscal quarter
of the Borrower, the sum of (A) the amount of Consolidated Net
Worth required to be maintained pursuant to this Section
8.1(a) as at the end of the immediately preceding fiscal
quarter, plus (B) 75% of Consolidated Net Income (with no
reduction for net losses during any period) for the fiscal
quarter of the Borrower ending on such day (including within
"Consolidated Net Income" certain items otherwise excluded, as
provided for in the definition of "Consolidated Net Income"),
plus (C) 100% of the aggregate amount of all increases in the
stated capital and additional paid-in capital accounts of the
Borrower resulting from any Capital Markets Transactions.
(c) Section 8.1(b) is amended and restated in its entirety as
follows:
(b) Consolidated EBITDA. Permit Consolidated EBITDA as of
the end of any fiscal month for any Twelve Month Period ending on or
about the dates indicated below to be less than the amount set forth
below opposite such date:
<TABLE>
<CAPTION>
Minimum
Twelve Month Period Ending Date Consolidated
EBITDA
------------------------------- ------------
<S> <C>
December 26, 1999 $14,500,000
January 30, 2000 $10,000,000
February 27, 2000 $ 8,500,000
April 2, 2000 $ 7,500,000
May 7, 2000 $ 8,000,000
June 4, 2000 $ 8,500,000
</TABLE>
<PAGE> 3
3. Restatement of Representations and Warranties. The Borrower
hereby restates and renews each and every representation and warranty heretofore
made by it in the Credit Agreement (as amended and modified hereby) and the
other Loan Documents as fully as if made on the date hereof and with specific
reference to this Amendment and all other loan documents executed and/or
delivered in connection herewith.
4. Effect of Amendment. Except as set forth expressly
hereinabove, all terms of the Credit Agreement and the other Loan Documents
shall be and remain in full force and effect, and shall constitute the legal,
valid, binding and enforceable obligations of the Borrower. The agreements
contained herein shall be deemed to have prospective application only, unless
otherwise specifically stated herein.
5. Ratification. The Borrower hereby restates, ratifies and
reaffirms each and every term, covenant and condition set forth in the Credit
Agreement and the other Loan Documents effective as of the date hereof and
agrees that this Amendment is one of the Loan Documents.
6. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which may be delivered by facsimile and which (including counterparts delivered
by facsimile) when so executed and delivered shall be deemed to be an original
and all of which counterparts, taken together, shall constitute but one and the
same instrument.
7. Section References. Section titles and references used in this
Amendment shall be without substantive meaning or content of any kind whatsoever
and are not a part of the agreements among the parties hereto evidenced hereby.
8. No Default or Claims. To induce the Lender to enter into this
Amendment and to continue to make advances pursuant to the Credit Agreement, the
Borrower hereby acknowledges and agrees that, as of the date hereof, and after
giving effect to the terms hereof, (i) no Default or Event of Default exists,
(ii) no right of offset, recoupment, defense, counterclaim, claim or objection
exists in favor of the Borrower arising out of or with respect to any of the
Loans or other obligations of the Borrower owed to the Lenders under the Credit
Agreement, and (iii) the Bank has acted in good faith and has conducted its
relationships with the Borrower in a commercially reasonable manner in
connection with the negotiations, execution and delivery of this Amendment and
in all respects in connection with the Credit Agreement, the Borrower hereby
waiving and releasing any such claims to the contrary that may exist as of the
date of this Amendment.
9. Governing Law. This Amendment shall be governed by and
construed and interpreted in accordance with, the laws of the State of Georgia.
3
<PAGE> 4
10. Conditions Precedent.. This Amendment shall become effective
only upon delivery to Wade M. Kennedy, at facsimile 704-334-8467, of: (i) this
Amendment, executed by each of the parties hereto; (ii) the Consent and
Reaffirmation of Guarantors at the end hereof, executed by each of the
Guarantors; (iii) the letter agreement of even date herewith by the Borrower and
each of the Secured Parties executed by all parties thereto; (iv) a copy of an
amendment, satisfactory to the Lender in all respects, to the Wachovia Credit
Agreement, extending maturities thereunder to June 4, 2000, and amending Section
8.1(a) and (b) thereof to be consistent with Section 8.1(a) and (b) hereof after
giving effect to this Amendment, executed by the parties thereto; and (v) a copy
of an amendment, satisfactory to the Lender in all respects, to the Prudential
Note Agreement, amending Section 6A(i) and (ii) thereof to be consistent with
Section 8.1(a) and (b) hereof after giving effect to this Amendment, executed by
the parties thereto.
4
<PAGE> 5
IN WITNESS WHEREOF, the Borrower and the Lender have caused this
Amendment to be duly executed, under seal, by their duly authorized officers as
of the day and year first above written.
CROWN CRAFTS, INC. (SEAL)
By: /s/ David S. Fraser
---------------------------------------
Name: David S. Fraser
-------------------------------------
Title: Vice President, CFO
------------------------------------
BANK OF AMERICA, N.A. (SEAL)
By: /s/ John F. Register
---------------------------------------
Name: John F. Register
-------------------------------------
Title: Principal
------------------------------------
5
<PAGE> 6
CONSENT AND REAFFIRMATION OF GUARANTORS
Each of the undersigned (i) acknowledges receipt of the foregoing
Amendment No. 2 to Revolving Credit Agreement (the "Amendment"), (ii) consents
to the execution and delivery of the Amendment by the parties thereto, and (iii)
reaffirms all of its obligations and covenants under that certain Subsidiary
Guaranty Agreement dated as of August 9, 1999, and agrees that none of such
obligations and covenants shall be affected by the execution and delivery of the
Amendment. This Consent and Reaffirmation may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which counterparts, taken together, shall constitute but one and the same
instrument.
GUARANTORS:
CHURCHILL WEAVERS, INC.
CROWN CRAFTS DESIGNER, INC.
CROWN CRAFTS FURNISHINGS, INC.
CROWN CRAFTS FURNISHINGS OF
ILLINOIS, INC.
G.W. STORES, INC.
HAMCO, INC.
CROWN CRAFTS INFANT PRODUCTS, INC.
(as successor to Noel Joanna, Inc. and
The Red Calliope and Associates, Inc.)
By: /s/ David S. Fraser
---------------------------------------
Name: David S. Fraser
-------------------------------------
Title: Vice President
------------------------------------
6
<PAGE> 1
EXHIBIT 10.2
AMENDMENT NO. 2 TO REVOLVING CREDIT AGREEMENT
THIS AMENDMENT NO. 2 TO REVOLVING CREDIT AGREEMENT (this "Amendment")
is dated effective as of March 13, 2000, among CROWN CRAFTS, INC. (the
"Borrower") and WACHOVIA BANK, N.A. (the "Lender");
W I T N E S S E T H:
WHEREAS, the Borrower and the Lender executed and delivered that
certain Credit Agreement, dated as of August 9, 1999, as amended by Amendment
No. 1 to Revolving Credit Agreement dated as of February 23, 2000 (as so
amended, the "Credit Agreement");
WHEREAS, the Borrower has requested and the Lender has agreed to
certain amendments to certain provisions in the Credit Agreement, subject to
the terms and conditions hereof;
NOW, THEREFORE, for and in consideration of the above premises and
other good and valuable consideration, the receipt and sufficiency of which
hereby is acknowledged by the parties hereto, the Borrower and the Lender
hereby covenant and agree as follows:
1. Definitions. Unless otherwise specifically defined herein,
each term used herein which is defined in the Credit Agreement shall have the
meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall from and after the date hereof refer to
the Credit Agreement as amended hereby.
2. Amendments to Credit Agreement.
(a) Each of the following definitions contained in Section 1.1 of
the Credit Agreement is amended and restated in its entirety in alphabetical
order as follows:
"Revolving A Credit Termination Date" means (i) June
4, 2000 or (ii) such earlier date of termination of Lender's
obligations pursuant to Section 9.1 upon the occurrence of an
Event of Default, or (iii) such date as the Borrower may
permanently terminate the Revolving A Credit Facility by
payment in full of all
<PAGE> 2
Revolving A Credit Outstandings and cancellation of the
Revolving A Credit Commitment pursuant to Section 2.3 hereof.
"Term Loan Maturity Date" means the earlier of (i)
June 4, 2000, or (ii) such earlier date of termination of the
Lender's obligations pursuant to Section 9.1 or the
acceleration of any Loans upon the occurrence of an Event of
Default.
(b) Section 8.1(a) is amended and restated in its entirety as
follows:
(a) Consolidated Net Worth. Permit Consolidated
Net Worth at any time to be less than (i) $75,000,000 from
the Closing Date through the end of the fiscal month of the
Borrower ending February 27, 2000; (ii) $70,000,000 from
February 28, 2000 to the last day of the fiscal quarter of
the Borrower ending April 2, 2000 and (iii) as at the last
day of each succeeding fiscal quarter of the Borrower after
the fiscal quarter of the Borrower ending April 2, 2000 and
until (but excluding) the last day of the next following
fiscal quarter of the Borrower, the sum of (A) the amount of
Consolidated Net Worth required to be maintained pursuant to
this Section 8.1(a) as at the end of the immediately
preceding fiscal quarter, plus (B) 75% of Consolidated Net
Income (with no reduction for net losses during any period)
for the fiscal quarter of the Borrower ending on such day
(including within "Consolidated Net Income" certain items
otherwise excluded, as provided for in the definition of
"Consolidated Net Income"), plus (C) 100% of the aggregate
amount of all increases in the stated capital and additional
paid-in capital accounts of the Borrower resulting from any
Capital Markets Transactions.
(c) Section 8.1(b) is amended and restated in its entirety as
follows:
(b) Consolidated EBITDA. Permit Consolidated EBITDA as
of the end of any fiscal month for any Twelve Month Period
ending on or about the dates indicated below to be less than
the amount set forth below opposite such date:
<TABLE>
<CAPTION>
Twelve Month Period Ending Date Minimum
------------------------------- Consolidated
EBITDA
------
<S> <C>
December 26, 1999 $14,500,000
January 30, 2000 $10,000,000
February 27, 2000 $ 8,500,000
April 2, 2000 $ 7,500,000
May 7, 2000 $ 8,000,000
June 4, 2000 $ 8,500,000
</TABLE>
<PAGE> 3
3. Restatement of Representations and Warranties. The Borrower
hereby restates and renews each and every representation and warranty
heretofore made by it in the Credit Agreement (as amended and modified hereby)
and the other Loan Documents as fully as if made on the date hereof and with
specific reference to this Amendment and all other loan documents executed
and/or delivered in connection herewith.
4. Effect of Amendment. Except as set forth expressly
hereinabove, all terms of the Credit Agreement and the other Loan Documents
shall be and remain in full force and effect, and shall constitute the legal,
valid, binding and enforceable obligations of the Borrower. The agreements
contained herein shall be deemed to have prospective application only, unless
otherwise specifically stated herein.
5. Ratification. The Borrower hereby restates, ratifies and
reaffirms each and every term, covenant and condition set forth in the Credit
Agreement and the other Loan Documents effective as of the date hereof and
agrees that this Amendment is one of the Loan Documents.
6. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which may be delivered by facsimile and which (including counterparts delivered
by facsimile) when so executed and delivered shall be deemed to be an original
and all of which counterparts, taken together, shall constitute but one and the
same instrument.
7. Section References. Section titles and references used in
this Amendment shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreements among the parties hereto
evidenced hereby.
8. No Default or Claims. To induce the Lender to enter into this
Amendment and to continue to make advances pursuant to the Credit Agreement,
the Borrower hereby acknowledges and agrees that, as of the date hereof, and
after giving effect to the terms hereof, (i) no Default or Event of Default
exists, (ii) no right of offset, recoupment, defense, counterclaim, claim or
objection exists in favor of the Borrower arising out of or with respect to any
of the Loans or other obligations of the Borrower owed to the Lenders under the
Credit Agreement, and (iii) the Bank has acted in good faith and has conducted
its relationships with the Borrower in a commercially reasonable manner in
connection with the negotiations, execution and delivery of this Amendment and
in all respects in connection with the Credit Agreement, the Borrower hereby
waiving and releasing any such claims to the contrary that may exist as of the
date of this Amendment.
9. Governing Law. This Amendment shall be governed by and
construed and interpreted in accordance with, the laws of the State of Georgia.
10. Conditions Precedent. This Amendment shall become effective
only upon delivery to Christopher L. Carson, at facsimile 404-581-8868, of: (i)
this Amendment, executed
3
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by each of the parties hereto; (ii) the Consent and Reaffirmation of Guarantors
at the end hereof, executed by each of the Guarantors; (iii) the letter
agreement of even date herewith by the Borrower and each of the Secured Parties
executed by all parties thereto; (iv) a copy of an amendment, satisfactory to
the Lender in all respects, to the Bank of America Credit Agreement, extending
maturities thereunder to June 4, 2000, and amending Section 8.1(a) and (b)
thereof to be consistent with Section 8.1(a) and (b) hereof after giving effect
to this Amendment, executed by the parties thereto; and (v) a copy of an
amendment, satisfactory to the Lender in all respects, to the Prudential Note
Agreement, amending Section 6A(i) and (ii) thereof to be consistent with
Section 8.1(a) and (b) hereof after giving effect to this Amendment, executed
by the parties thereto.
[SIGNATURES CONTAINED ON NEXT PAGE]
4
<PAGE> 5
IN WITNESS WHEREOF, the Borrower and the Lender have caused this Amendment to
be duly executed, under seal, by their duly authorized officers as of the day
and year first above written.
CROWN CRAFTS, INC. (SEAL)
By: /s/ David S. Fraser
-------------------------------
Title: Vice President, CFO
WACHOVIA BANK, N.A. (SEAL)
By: /s/ R.E.S. Bowen
-------------------------------
Title: Vice President
5
<PAGE> 6
CONSENT AND REAFFIRMATION OF GUARANTORS
Each of the undersigned (i) acknowledges receipt of the foregoing
Amendment No. 2 to Revolving Credit Agreement (the "Amendment"), (ii) consents
to the execution and delivery of the Amendment by the parties thereto, and
(iii) reaffirms all of its obligations and covenants under that certain
Subsidiary Guaranty Agreement dated as of August 9, 1999, and agrees that none
of such obligations and covenants shall be affected by the execution and
delivery of the Amendment. This Consent and Reaffirmation may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original and all of which counterparts, taken together, shall constitute
but one and the same instrument.
GUARANTORS:
CHURCHILL WEAVERS, INC.
CROWN CRAFTS DESIGNER, INC.
CROWN CRAFTS FURNISHINGS, INC.
CROWN CRAFTS FURNISHINGS OF
ILLINOIS, INC.
G.W. STORES, INC.
HAMCO, INC.
CROWN CRAFTS INFANT PRODUCTS,
INC. (as successor to Noel Joanna, Inc. and
the Red Calliope and Associates, Inc.)
By: /s/ David S. Fraser
----------------------------------------
Title: Vice President
6
<PAGE> 1
AMENDMENT OF 1995 NOTE AGREEMENT
This Amendment, entered into as of March 13, 2000, by and between CROWN
CRAFTS, INC. (the "COMPANY") and THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
("NOTEHOLDER").
WHEREAS, the parties hereto have executed and delivered that certain
Note Purchase and Private Shelf Facility dated as of October 12, 1995 (as
previously amended and as it may be further amended, modified or supplemented,
the "NOTE AGREEMENT");
WHEREAS, the Company has requested a modification of certain covenants
under the Note Agreement;
WHEREAS, Noteholder is willing to enter into this Amendment subject to
the satisfaction of conditions and terms set forth herein;
WHEREAS, capitalized terms used herein and not otherwise defined shall
have the meanings set forth in the Note Agreement; and
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. AMENDMENTS TO PARAGRAPH 6A OF THE NOTE AGREEMENT.
1A. Paragraph 6A(i) shall be amended in its entirety to read as
follows
(a) CONSOLIDATED NET WORTH. Permit Consolidated Net Worth
at any time to be less than (i) $75,000,000 from the Effective Date
through the end of the fiscal month of the Company ending February 27,
2000; (ii) $70,000,000 from February 28, 2000 to the last day of the
fiscal quarter of the Company ending April 2, 2000 and (iii) as at the
last day of each succeeding fiscal quarter of the Company after the
fiscal quarter of the Company ending April 2, 2000 and until (but
excluding) the last day of the next following fiscal quarter of the
Company, the sum of (A) the amount of Consolidated Net Worth required
to be maintained pursuant to this paragraph 6A(i) as at the end of the
immediately preceding fiscal quarter, plus (b) 75% of Consolidated Net
Income (with no reduction for net losses during any period) for the
fiscal quarter of the Company ending on such day (including within
"Consolidated Net Income" certain items otherwise excluded, as provided
for in the definition of "Consolidated Net Income"), plus (C) 100%
<PAGE> 2
of the aggregate amount of all increases in the stated capital and
additional paid in capital accounts of the Company resulting from any
Capital Markets Transactions.
1B. Paragraph 6A(ii) shall be amended by inserting the following in
the appropriate order:
<TABLE>
<CAPTION>
Minimum
Twelve Month Period Ending Date Consolidated EBITDA
------------------------------- -------------------
<S> <C>
May 7, 2000 $8,000,000
June 4, 2000 $8,500,000
</TABLE>
2. Conditions of Effectiveness. This Amendment shall become
effective when, and only when:
(a) the Noteholder shall have received executed originals of this
Amendment and all of the following documents, each (unless otherwise indicated)
being dated the date hereof, in form and substance satisfactory to the
Noteholder:
(i) Copies of (A) all documents evidencing all requisite
corporate action of the Company (including any and all resolutions of
the Board of Directors of the Company) authorizing the execution,
delivery and performance of this Amendment and the matters
contemplated hereby and thereby, and (B) all documents evidencing all
governmental approvals, if any, with respect to this Amendment and the
matters contemplated hereby and thereby:
(ii) A certificate of the Secretary or an Assistant Secretary
of the Company certifying the names and true signatures of the
officers authorized to sign this Amendment on behalf of the Company
and any other documents to be delivered by the Company hereunder;
(iii) the Consent and Reaffirmation of the Facility
Guarantors attached hereto as Exhibit A by each of the Guarantors;
(iv) A duly executed Amendment No. 2, satisfactory to the
Required Holders in all respects, to the Wachovia Bank Credit
Agreement;
(v) A duly executed Amendment No. 2, satisfactory to the
Required Holders in all respects, to the Bank of America Credit
Agreement;
(vi) A letter agreement duly executed by all the parties
thereto, substantially in the form attached hereto as Exhibit B;
(vii) Such other documents, instruments, approvals or opinions
as the Purchasers may reasonably request; and
<PAGE> 3
(b) The representations and warranties contained herein shall be true
on and as of the date hereof, there shall exist on the date hereof, no Event of
Default or Default; there shall exist no material adverse change in the
financial condition, business operation or prospects of the Company or its
Subsidiaries since March 28, 1999 other than as reported by the Company in its
quarterly reports on Form 10-Q filed with the Securities and Exchange
Commission for quarterly periods subsequent to March 28, 1999; and the Company
shall have delivered to the Purchasers an Officer's Certificate to such effect;
and
(c) The Company shall have paid all costs and expenses (including
legal fees) incurred by any Purchaser.
3. Representations and Warranties.
(a) The Company hereby repeats and confirms each of the
representations and warranties made by it in the Note Agreement, as amended
hereby, as though made on and as of the date hereof, with each reference
therein to "this Agreement", "hereof", "hereunder", "thereof", "thereunder" and
words of like import being deemed to be a reference to the Note Agreement as
amended hereby.
(b) The Company further represents and warrants as follows:
(i) The execution, delivery and performance by the Company
of this Amendment is within its corporate powers, have been duly
authorized by all necessary corporate action and do not contravene (A)
its charter or by-laws, (B) law or (C) any legal or contractual
restriction binding on or affecting the Company; and such execution,
delivery and performance do not or will not result in or require the
creation of any Lien upon or with respect to any of its properties.
(ii) No governmental approval is required for the due
execution, delivery and performance by the Company of this Amendment,
except for such governmental approvals as have been duly obtained or
made and which are in full force and effect on the date hereof and not
subject to appeal.
(iii) This Amendment constitutes the legal, valid and
binding obligations of the Company enforceable against the Company in
accordance with its terms.
(iv) There are no pending or threatened actions, suits or
proceedings affecting the Company or any of its Subsidiaries or the
properties of the Company or any of its Subsidiaries before any court,
governmental agency or arbitrator, that amy, if adversely determined,
materially adversely affect the financial condition, properties,
business, operations or prospects of the Company and its Subsidiaries,
considered as a whole, or affect the legality, validity or
enforceability of the Note Agreement as amended by this Amendment.
<PAGE> 4
(v) No material adverse change in the financial condition,
business operation or prospects of the Company or its Subsidiaries has
occurred since March 28, 1999.
(vi) No Event of Default or Default has occurred and in
continuing.
4. Miscellaneous.
4A. Reference to and Effect on the Note Agreement.
(a) Upon the effectiveness of this Amendment, on and after the
date hereof each reference in the Note Agreement to "this Agreement",
"hereunder", "hereof" or words of like import referring to the Note
Agreement, and each reference in any other document to "the Note
Agreement", "thereunder", "thereof" or words of like import referring
to the Note Agreement, shall mean and be a reference to the Note
Agreement, as amended hereby.
(b) Except as specifically amended above, the Note Agreement
and the Notes, and all other related documents, are and shall continue
to be in full force and effect and are hereby in all respects ratified
and confirmed.
(c) The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate as a
waiver of any right, power or remedy of any holder of a Note under the
Note Agreement or the Notes, nor constitute a waiver of any provision
of any of the foregoing.
4B. Costs and Expenses. The Company agrees to pay on demand
all costs and expenses incurred by any holder of a Note in connection
with the preparation, execution and delivery of this Amendment,
including, without limitation, the reasonable fees and out-of-pocket
expenses of counsel. The Company further agrees to pay on demand all
costs and expenses, if any (including, without limitation, reasonable
counsel fees and expenses of counsel), incurred by any holder of a Note
in connection with the enforcement (whether through negotiations, legal
proceedings or otherwise) of this Amendment, including, without
limitation, counsel fees and expenses in connection with the
enforcement of rights under this paragraph 4B.
4C. Execution in Counterparts. This Amendment may be executed
in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered
shall be deemed to be an original and all of which taken together shall
constitute but one and the same instrument.
4D. Governing Law. This Amendment shall be governed by, and
construed in accordance with the laws of the State of New York.
4E. No Default or Claims. To induce the Noteholder to enter
into this Amendment, the Company hereby acknowledges and agrees that,
as of the date hereof, and after giving effect to the terms hereof, (i)
no Default or Event of Default exists, (ii) no right of offset,
recoupment, defense, counterclaim, claim or objection exists in favor
of the Company arising out of or with
<PAGE> 5
5
respect to any of the Notes or other obligations of the Company owed to any
holder of a Note, and (iii) the Noteholder has acted in good faith and has
conducted its relationships with the Company in a commercially reasonable
manner in connection with the negotiations, execution and delivery of this
Amendment and in all respects in connection with the Note Agreement, the
Company hereby waiving and releasing any such claims to the contrary that may
exist as of the date of this Amendment.
[Signatures on Next Page.]
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
CROWN CRAFTS, INC.
By /s/ David S. Fraser
------------------------------
Title: Vice President, CFO
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By /s/ Robert R. Derrick
------------------------------
Title: Vice President
<PAGE> 7
CONSENT AND REAFFIRMATION OF FACILITY GUARANTORS
Each of the undersigned (i) acknowledges receipt of the foregoing
Amendment of 1995 Note Agreement (the "Amendment"), (ii) consents to the
execution and delivery of the Amendment by the parties thereto, and (iii)
reaffirms all of its obligations and covenants under that certain Subsidiary
Guaranty Agreement dated as of August 9, 1999, and agrees that none of such
obligations and covenants shall be affected by the execution and delivery of the
Amendment. This Consent and Reaffirmation may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which counterparts, taken together, shall constitute but one and the same
instrument.
FACILITY GUARANTORS:
CHURCHILL WEAVERS, INC.
CROWN CRAFTS DESIGNER, INC.
CROWN CRAFTS FURNISHINGS, INC.
CROWN CRAFTS FURNISHINGS OF
ILLINOIS, INC.
G.W. STORES, INC.
HAMCO, INC.
CROWN CRAFTS INFANT PRODUCTS, INC.
(as successor to Noel Joanna, Inc. and
The Red Calliope and Associates, Inc.)
By: /s/ David S. Fraser
-----------------------------------------
Name: David S. Fraser
---------------------------------------
Title: Vice President
---------------------------------------
