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
CROWN
CRAFTS’ BOARD REJECTS WYNNEFIELD’S SETTLEMENT PROPOSAL
--
Incumbent Board Denies Largest Stockholder ‘Seat at the Table’
--
NEW
YORK, NY, August 1, 2007 - The
Wynnefield Group, the largest stockholder in Crown Crafts Inc. (NASDAQ: CRWS),
said today that the Company’s rejection of its amicable compromise offer
demonstrates the entrenchment of Crown Crafts’ current directors and management,
which has harmed shareholder value and put the Company’s prospects at
risk.
Wynnefield
is Crown Crafts’ largest stockholder (holding some 14.6% of the outstanding
shares) and a long-term investor in the Company.
In
its
place, the Company offered a “fig-leaf” proposal to elect its two director
nominees in exchange for the election of a single director unaffiliated with
the
Company’s single largest stockholder by 2008.
“These
guys don’t get it; this is too little, too late. The stockholders are the owners
of this company, and outside stockholders need a voice on the Board now. This
isn’t about expanding the Board for the sake of expanding the Board,” said
Nelson Obus and Frederick Wasserman, Wynnefield’s nominees to the Crown Crafts
Board of Directors, in a statement.
“Despite
Crown Crafts’ faltering performance and lack of strategic vision, the entrenched
Company directors and management apparently will resist even amicable compromise
efforts to provide outside stockholders with real Board
representation.
“For
years, we have tried to find a way to work with the current Board and management
to address some of the stiff challenges facing this company. At this point,
the
only alternative left for outside stockholders is to elect two truly independent
directors to the Board - vote for the Wynnefield nominees on the GOLD card,”
Wasserman and Obus concluded.
Wynnefield
is conducting a proxy solicitation campaign to elect two truly independent
outside directors to the Board - in opposition to two Company nominees, William
Deyo and Steven Fox - in order to enhance value for all Crown Crafts
stockholders. Wynnefield undertook the proxy campaign reluctantly as a last
resort only after long concern with Crown Crafts’ failure to generate long-term
growth and stockholder value (including its failure to develop a strategic
plan
or an announced succession plan), and repeated refusals to improve its corporate
governance (including the elimination of apparent conflicts-of-interest) or
grant Wynnefield Board representation.
Crown
Crafts’ Board Rejects Wynnefield’s Settlement Proposal -
continued
Earlier
this week, Wynnefield announced an offer to withdraw its proxy contest to elect
its two nominees if the Company agreed to make a series of important
enhancements to its corporate governance and director compensation. Those
proposed enhancements included:
| ·
|
increasing
the size of the current Board from seven to nine members;
|
| ·
|
electing
Obus and Wasserman as directors to fill the vacancies thereby created;
|
| ·
|
form
a nominating and governance committee immediately, with either Obus
or
Wasserman as one of the members;
|
| ·
|
form
a strategic planning committee immediately, with current CEO E. Randall
Chestnut as one of the members and either Obus or 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;
|
| ·
|
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
|
| ·
|
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.
|
Messrs.
Wasserman and Obus would bring to the Board substantial business experience
and
capability, as well as a commitment to work to enhance stockholder value and
to
work cooperatively with the Board to implement a strategic plan to achieve
those
results. Mr. Wasserman previously served as a non-voting observer to the Crown
Crafts’ Board.
Mr.
Obus
has more than thirty-five years of experience in the investment community,
including his role as President of Wynnefield Capital, Inc. since 1992, Director
of Research at Schafer Capital Management for two years and eight years at
Lazard Freres & co. as an analyst, account executive and research director
in its institutional sales department. Previously, Mr. Obus worked as an
educator and land manager in the environmental field. He currently serves on
the
board of directors of Layne Christensen Company and is also a member of its
Compensation Committee and Audit Committee of the board of directors. Mr. Obus
has been nominated to serve as a member of the board of directors of Gilman
+
Ciocia, Inc., a regional tax preparation and investment advisory company subject
to approval by that company’s stockholders of a pending financing transaction.
He previously served as a director of Sylvan Food Holdings, Inc.
Mr.
Wasserman, currently a financial management consultant, was the Chief
Operating/Financial Officer for Mitchell & Ness Nostalgia Co., a
privately-held manufacturer and distributor of licensed sportswear and authentic
team apparel. He has also served as the President of Goebel of North America,
a
U.S. subsidiary of the German specialty gift maker, from 2001 to 2005; several
positions, including Chief Financial Officer and President with Goebel of North
America in 2001; and several other positions, including Interim President and
full-time Chief Financial Officer with Papel Giftware from 1995 to 2001. He
has
also served in senior executive and managerial roles at both Chelsea Marketing
and Sales and The Score Board, Inc. Mr. Wasserman spent the first 13 years
of
his career in the public accounting profession, serving at Most, Horowitz &
Company; Coopers & Lybrand; and Richard A. Eisner & Company. He also
serves as a director of Acme Communications, Inc., Allied Defense Group, Inc.,
and Teamstaff, Inc. and has been nominated to serve as a member of the board
of
directors of Gilman + Ciocia, Inc., a regional tax preparation and investment
advisory company subject to approval by that company’s stockholders of a pending
financing transaction.
Crown
Crafts’ Board Rejects Wynnefield’s Settlement Proposal -
continued
The
Annual Meeting of Crown Crafts Stockholders will be held on August 14, 2007
at
10:00 a.m. Central Daylight Time at the Company’s executive offices, located at
916 South Burnside Avenue, Third Floor, Gonzales, Louisiana
70737offices.
The
Wynnefield Group urges stockholders to sign, date and return the GOLD
proxy
card voting FOR the election of Frederick Wasserman and Nelson Obus as
directors. If you have already voted a white proxy card and wish to change
your
vote, you have every legal right to do so. Simply vote the GOLD proxy promptly
by telephone, internet or mail. Only the last dated vote will count. For more
information, stockholders can call MacKenzie Partners at (800)
322-2885.
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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