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
Filed
by
the registrant o
Filed
by
a party other than the registrant x
Check
the
appropriate box:
o Preliminary
proxy
statement.
o
Confidential, for use of the Commission
only (as permitted by Rule 14a-6(e)(2)).
o
Definitive proxy statement.
x
Definitive additional
materials.
o
Soliciting material under Rule
14a-12.
CROWN
CRAFTS, INC.
(Name
of
Registrant as Specified in its Charter)
WYNNEFIELD
PARTNERS SMALL CAP VALUE, L.P.
WYNNEFIELD
PARTNERS SMALL CAP VALUE, L.P. I
WYNNEFIELD
SMALL CAP VALUE OFFSHORE FUND, LTD.
WYNNEFIELD
CAPITAL MANAGEMENT, LLC
WYNNEFIELD
CAPITAL, INC.
CHANNEL
PARTNERSHIP II, L.P.
NELSON
OBUS
JOSHUA
H.
LANDES
(Name
of
Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment
of filing fee (check the appropriate box):
x
No fee required.
o
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:
(2)
Aggregate number of securities to which transaction applies:
(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):
(4)
Proposed maximum aggregate value of transaction:
(5)
Total
fee paid:
o
Fee paid previously with preliminary
materials.
o
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:
(2)
Form,
Schedule or Registration Statement No.:
(3)
Filing Party:
(4)
Date
Filed:
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
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
|
or |
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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