Exhibit 10.2
Warehousing Agreement
Between
Springs Global US, Inc.
And
Crown Crafts Infant Products, Inc.
November 5, 2007

 

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TABLE OF CONTENTS

              ARTICLE 1     4  
 
            TERM OF AGREEMENT     4  
 
            ARTICLE 2     4  
 
            WAREHOUSEMAN’S RESPONSIBILITIES     4  
 
           
2.1
  Services     4  
2.2
  Warehouse Operations     5  
2.3
  Transfer of Products     5  
 
            ARTICLE 3     5  
 
            CROWN CRAFTS’ RESPONSIBILITIES     5  
 
           
3.1
  Delivery and Shipments; Packaging     5  
3.2
  Product Characteristics/Refusal to Accept Products     5  
3.3
  Prohibition of Consignment     6  
3.4
  Warehouseman Compensation     6  
 
            ARTICLE 4     6  
 
            TERMS OF PAYMENT     6  
 
            ARTICLE 5     7  
 
            LIABILITIES AND INDEMNIFICATION     7  
 
           
5.1
  General - Warehouse     7  
5.2
  Demurrage; Detention     8  
5.3
  Shrinkage/Damage Allowance     8  
5.4
  Insurance     8  
 
            ARTICLE 6     8  
 
            PHYSICAL INVENTORIES AND ADJUSTMENTS     8  
 
           
6.1
  Physical Inventories     8  
6.2
  Inventory Adjustments     9  
6.3
  Reconciliation of Inventory Records     9  

 

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              ARTICLE 7     10  
 
            FORCE MAJEURE     10  
 
            ARTICLE 8     10  
 
            DEFAULT     10  
 
           
8.1
  Automatic Default     10  
8.2
  General Default; Right to Cure     10  
8.3
  Effect of Termination     11  

 

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ARTICLE 9
    11  
 
       
RECORDS
    11  
 
       
ARTICLE 10
    11  
 
       
INDEPENDENT CONTRACTOR
    11  
 
       
ARTICLE 11
    11  
 
       
COMPLIANCE
    11  
 
       
ARTICLE 12
    12  
 
       
SUCCESSORSHIP
    12  
 
       
ARTICLE 13
    12  
 
       
APPLICABLE LAW; SEVERABILITY; SAVINGS
    12  
 
       
ARTICLE 14
    12  
 
       
ENTIRE AGREEMENT; AMENDMENT; CAPTIONS
    12  
 
       
ARTICLE 15
    12  
 
       
NOTICES
    12  
 
       
ARTICLE 16
    13  
 
       
WAIVER
    13  
 
       
ARTICLE 17
    14  
 
       
EXECUTION IN COUNTERPARTS; FACSIMILE SIGNATURES
    14  

SCHEDULES
Schedule A — Description of Services
Schedule B — Rate Schedule
Schedule C — Insurance Schedule

 

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WAREHOUSING AGREEMENT
     This WAREHOUSING AGREEMENT (as amended, restated, supplemented or otherwise
modified from time to time, this “Agreement”) is made and entered into as of the
5th day of November, 2007, by and between SPRINGS GLOBAL US, INC., a Delaware
corporation (“Warehouseman”), and CROWN CRAFTS INFANT PRODUCTS, INC., a Delaware
corporation (“Crown Crafts”). Warehouseman and Crown Crafts are each referred to
herein as a “Party” and collectively as the “Parties.”
WITNESSETH:
     WHEREAS, the Parties have entered into an Asset Purchase Agreement dated as
of the date hereof (the “Asset Purchase Agreement”) pursuant to which Springs
Global has agreed to sell, and Crown Crafts has agreed to buy, certain of the
assets of Springs Global’s baby product line; and
     WHEREAS, in connection with the transactions contemplated by the Asset
Purchase Agreement, Crown Crafts desires that Springs Global provide, or cause
to be provided, to Crown Crafts, and Springs Global is willing to provide, or
cause to be provided, to Crown Crafts, certain warehousing services in
connection with its warehouse located at 1495 East Locust Street, Ontario,
California 91761 (the “Warehouse”);
     NOW, THEREFORE, for and in consideration of the mutual agreements herein
contained, it is hereby mutually agreed as follows:
ARTICLE 1
TERM OF AGREEMENT
     The term of this Agreement shall commence on November 5, 2007, and continue
in effect until the close of business on May 5, 2008 (“Term”).
ARTICLE 2
WAREHOUSEMAN’S RESPONSIBILITIES
     2.1 Services. During the Term, Warehouseman agrees to provide for Crown
Crafts certain warehousing services described in Schedule A attached hereto and
incorporated herein by this reference (the “Services”) at the Warehouse. As part
of the Services, Warehouseman shall accept and keep in a safe, neat and orderly
condition such goods as from time to time may be tendered by Crown Crafts for
warehousing or handling in accordance with the terms of this Agreement (the
“Products”). Warehouseman further agrees to furnish and/or obtain sufficient
personnel, equipment, and other accessories necessary to perform the Services in
accordance with this Agreement.

 

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     2.2 Warehouse Operations. The Parties agree that, except as specifically
modified herein, Warehouseman will be a warehouseman as described in Article 7
of the Uniform Commercial Code (“UCC”) as enacted in the state where the
Warehouse is located and is entitled to all rights and subject to all
obligations described therein. Warehouseman shall perform the Services with
substantially the same degree of care, skill, diligence and compliance with
applicable law and in substantially the same manner as performed immediately
prior to the date hereof.
     The Warehouse space will be utilized by Warehouseman as efficiently as
practicable without creating inefficiencies in handling operations. All Products
shall be segregated by stock keeping unit and physical location in the same
manner as similar products of Warehouseman were segregated prior to the date
hereof or as otherwise agreed upon by the Parties (a “stock keeping unit” being
the lowest level for which inventory material handling records are maintained
for purposes of this Agreement). Crown Crafts shall notify Warehouseman of
stocking limitations, Products to be accounted for separately and any other
Product peculiarities in writing prior to delivery of such Products to the
Warehouse.
     Crown Crafts may have certain employees working at the Warehouse during the
Term, subject to the terms and conditions herein. Prior to any employee of Crown
Crafts entering the Warehouse, Crown Crafts shall notify Warehouseman of (i) the
name of such employee, (ii) the length of time such employee will be working at
the Warehouse, and (iii) the duties to be performed by such employee.
Warehouseman shall have the right at any time to remove any employee or other
invitee of Crown Crafts from the premises if Warehouseman determines, in its
reasonable discretion, that such employee or invitee presents a risk to
Warehouseman, Warehouseman’s employees or assets or any other person or asset
located at the Warehouse.
     2.3 Transfer of Products. No Products shall be delivered or transferred
except upon receipt by Warehouseman of completed shipping documents from Crown
Crafts. Instructions to transfer Products on the books of Warehouseman shall not
be effective until said instructions are delivered to Warehouseman. All charges
relating to Warehouseman’s Services to Crown Crafts, including the receipt,
storage, servicing, handling and transfer of the Products, shall be chargeable
to Crown Crafts as set forth in Schedule B attached hereto and incorporated
herein by this reference.
ARTICLE 3
CROWN CRAFTS’ RESPONSIBILITIES
     3.1 Delivery and Shipments; Packaging. Crown Crafts will advise
Warehouseman of its warehousing needs in sufficient time to allow Warehouseman
to make necessary preparations for such warehousing. Crown Crafts will also
provide Warehouseman with instructions for shipments from the Warehouse, which
information will constitute Crown Crafts’ instructions for shipment of Products.
All Products tendered for warehousing will be properly marked and packaged for
handling.
     3.2 Product Characteristics/Refusal to Accept Products. Crown Crafts shall
promptly notify Warehouseman of the characteristics of any Products that require
special

 

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handling instructions, material, equipment or precautions. No Products shall be
delivered to Warehouseman that (a) may be hazardous or dangerous to
Warehouseman’s employees, subcontractors or agents, whether by handling or
exposure; (b) are defined as hazardous materials under any federal, state or
local law or regulation governing the environment, including, but not limited,
to The Resource Conservation and Recovery Act (RCRA), The Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended
(CERCLA), or Department of Transportation Research and Special Programs
Administration (RSPA including IATA, ICAO and IMDG); or (c) are or should be
reasonably believed or known to be likely to cause damage to Warehouseman’s
premises or equipment, the Products, or other goods that may be stored by
Warehouseman at the Warehouse. Warehouseman may refuse to accept any Products
that are identified as coming within the immediately preceding categories or
that reasonably might cause infestation, contamination or damage to other goods
in its custody. Warehouseman shall promptly notify Crown Crafts of such refusal
and shall have no liability for any demurrage, detention, transportation or
other charges by virtue of such refusal.
     3.3 Prohibition of Consignment. Crown Crafts agrees not to ship Products to
Warehouseman as the named consignee. If, in violation of this Agreement,
Products are to be shipped to Warehouseman as named consignee, Crown Crafts
agrees to notify the applicable carrier, in writing and prior to such shipment,
that Warehouseman named as consignee is a warehouseman under law and has no
beneficial title or interest in such Products. Crown Crafts will also deliver a
copy of such notice to Warehouseman prior to such shipment.
     3.4 Warehouseman Compensation. Crown Crafts shall pay Warehouseman
compensation for the Services provided by Warehouseman and the charges made by
Warehouseman in accordance with Schedule B.
ARTICLE 4
TERMS OF PAYMENT
     Except as may otherwise be specifically stated in any of the applicable
schedules hereto, Warehouseman shall invoice Crown Crafts promptly after the end
of each month for all Services performed, and costs incurred by Warehouseman,
under this Agreement during the preceding month. Crown Crafts shall pay the
amount invoiced within thirty (30) days from the date of such invoice. Payment
shall be considered made when payments have been received by Warehouseman.
     In the event Crown Crafts disputes any invoices (or any part thereof),
Crown Crafts shall provide Warehouseman with written notice of such dispute
within thirty (30) days of receipt of such invoice. Crown Crafts shall, however,
pay that portion of the invoice not in dispute. Any such amount not in dispute
and not paid within forty-five (45) days shall bear interest at a rate of 0.5%
per month (the “Default Rate”) from the date such amount was due. Crown Crafts
further agrees that it will pay all charges which are invoiced and that are not
expressly disputed without offset or counterclaim of any kind.
     Additionally, if any disputed portion of such invoice is later paid by
Crown Crafts, or is determined subsequently to be due and owing to Warehouseman,
Crown Crafts shall also pay

 

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Warehouseman interest on such amount from the original due date at the Default
Rate. Crown Crafts agrees to pay, in the event its account becomes delinquent
and is turned over to any attorney for collection, reasonable attorneys’ fees,
plus all consultant fees, court costs, and attendant collection costs actually
incurred.
ARTICLE 5
LIABILITIES AND INDEMNIFICATION
     5.1 General — Warehouse. Warehouseman shall be responsible for loss or
damage to all Products under its care, custody and control in the Warehouse as
provided in the UCC, subject to the provisions of this Article 5; provided that
Warehouseman shall have no liability to Crown Crafts for any loss or damage to
Products to the extent such loss or damage is caused by Crown Crafts or any of
its employees, agents or invitees.
     Warehouseman agrees to indemnify, save harmless, and defend Crown Crafts
from and against any and all claims for loss, damage or injury (including court
costs and reasonable attorneys’ fees) and from and against any suits, actions,
or legal proceedings brought against Crown Crafts for or on account of any loss
or damage to the tangible property of Crown Crafts or third parties, or for or
on account of any injuries received or sustained by any person, including, but
not limited to, employees of Warehouseman and employees and agents of Crown
Crafts, caused by, or arising out of, any intentional, reckless or grossly
negligent act or omission of Warehouseman or its employees, agents or invitees
in performing the Services, except to the extent such claim arises from the
gross negligence, recklessness or intentional act of Crown Crafts, its
employees, agents or servants.
     Crown Crafts shall indemnify and hold harmless Warehouseman from (i) any
and all claims for unpaid transportation charges, including undercharges,
demurrage and detention, in connection with Products shipped to or from the
Warehouse, except for such claims caused by Warehouseman’s failure to exercise
the standard of care set forth in Section 2.2 above, and (ii) any injury
(including death at anytime resulting therefrom) incurred by Crown Crafts’
employees, agents or invitees while such person is present at the Warehouse,
other than any such injury arising from the gross negligence, recklessness or
intentional act of Warehouseman, its employees, agents or servants.
     In addition, Crown Crafts agrees to indemnify, save harmless, and defend
Warehouseman from and against any and all claims for loss, damage or injury
(including court costs and reasonable attorneys’ fees) and from and against any
suits, actions, or legal proceedings brought against Warehouseman for or on
account of any loss or damage to the tangible property of Warehouseman or third
parties, or for or on account of any injuries received or sustained by any
person, including, but not limited, to employees of Crown Crafts and employees
and agents of Warehouseman, caused by, or arising out of, any intentional,
reckless or grossly negligent act or omission of Crown Crafts or its employees,
agents or invitees, as well as from any claims, expenses or demands of any kind
made by Crown Crafts’ employees, agents, servants or contractors while at the
Warehouse in connection with the performance of this Agreement, except to the
extent such claim arises from the gross negligence, recklessness or intentional
act of Warehouseman, its employees, agents or servants. Further, Crown Crafts
agrees to secure a

 

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waiver of subrogation from Crown Crafts’ workers’ compensation insurance carrier
in support of the above.
     5.2 Demurrage; Detention. Warehouseman shall not be liable for demurrage,
detention or delays in obtaining and loading cars or vehicles for outbound
shipments unless Warehouseman has failed to exercise the standard of care set
forth in Section 2.2 above. If detention occurs for which Warehouseman is
liable, payment of such detention shall be made by Warehouseman to the carrier.
     5.3 Shrinkage/Damage Allowance. Crown Crafts agrees to a damage and
inventory shrinkage allowance (applied over the Term) of 0.25% of the value of
the Products stored, for which, in the case of loss or damage to Products for
any reason or mysterious disappearance, however caused, Warehouseman shall not
be liable.
     5.4 Insurance. Warehouseman shall maintain at all times during the life of
this Agreement a policy or policies of insurance in full force and effect with
companies and in amounts identified on Schedule C attached hereto and
incorporated herein by this reference, covering warehouse legal liability for
loss or damage to Products due to the negligence of Warehouseman. Warehouseman
does not otherwise insure the Products. Warehouseman shall not be held liable
for any actions related to shipment of Products and will not carry insurance
coverage related to shipping transactions to or from the Warehouse. Warehouseman
agrees to furnish, at Crown Crafts’ request, certificates of all policies of
applicable insurance, such certificates to name Crown Crafts as certificate
holder. Warehouseman shall be responsible for insuring any physical assets that
it owns or leases and that are used in the Warehouse. Further, Warehouseman
agrees to secure a waiver of subrogation from Warehouseman’s insurance carrier
in support of the above.
     Crown Crafts agrees to maintain general comprehensive, unimpaired liability
insurance in an amount of not less than one million dollars ($1,000,000) per
occurrence, including contractual liability endorsement specifically covering
this Agreement, and statutory workers’ compensation insurance. This insurance
will be primary. Crown Crafts agrees to furnish, at Warehouseman’s request,
certificates of all policies of applicable insurance, such certificates to name
Warehouseman as an additional insured. Further, Crown Crafts agrees to secure a
waiver of subrogation from Crown Crafts’ insurance carrier in support of the
foregoing.
ARTICLE 6
PHYSICAL INVENTORIES AND ADJUSTMENTS
     6.1 Physical Inventories. A physical inventory shall be performed
reasonably promptly following the execution of this Agreement. Subsequently,
joint Crown Crafts/Warehouseman physical inventories shall be performed upon
mutual agreement by Crown Crafts and Warehouseman, but at least once at the end
of the Term. All shipping, receiving and inventory transaction processing will
be terminated during the period of the physical inventory to insure a
simultaneous cut-off of all activity. Charges for hourly warehouse personnel
will be as set forth on Schedule B.

 

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     6.2 Inventory Adjustments. If stock differences are found in any count,
Warehouseman and Crown Crafts will list gains as receipts, and losses as
deductions, thus reconciling the book record with the actual stock on hand.
Those changes will be based upon counts agreed to and signed by Crown Crafts’
representative and Warehouseman’s representative.
     (A) For purposes of determining the net balance of physical units on
Warehouseman’s account, all shortages and overages for the period, after taking
account of the shrinkage allowance set forth in Section 5.3, shall be reconciled
by stock keeping unit.
     (B) If there is a shortage for the period covered, after netting across
stock keeping units, the dollar amount (number of units of each stock keeping
unit multiplied by Crown Crafts’ respective standard costs, less allowances
provided for in Section 5.3 above, all of which shall be subject to the
provisions of subsection 6.2(D) below) shall be payable to Crown Crafts by
Warehouseman. If there is an overage on the account, adjustments will be made to
inventory book records and no claim will be filed by Warehouseman. The period
covered by the physical inventory will be closed to future netting routines
except under the following conditions:
     (i) proven miscount in physical inventory;
     (ii) proven clerical error by Crown Crafts;
     (iii) located or recovered lost shipment;
     (iv) proven packing or case marking error by Crown Crafts’ supplier; or
     (v) a shortage in a subsequent inventory matches an overage in a previous
inventory.
     (C) If the net inventory variance calculated during the physical inventory
is an overage and Warehouseman paid for a shortage in connection with the
preceding physical inventory, Crown Crafts will pay a refund to Warehouseman
based on the overage, but only to the extent that it does not exceed the
shortage for which Warehouseman has paid.
     (D) The dollar values used to determine the amounts of money owed by
Warehouseman in the event a physical inventory reveals a shortage shall be Crown
Crafts’ standard cost of said Products.
     6.3 Reconciliation of Inventory Records. If at any time discrepancies exist
between Crown Crafts’ records and the physical inventory, Warehouseman and Crown
Crafts shall provide to each other their records of all inventory adjustments
from the time of the previous reconciliation to the time of the inventory count
in which the discrepancy was found.

 

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ARTICLE 7
FORCE MAJEURE
     A Party shall not be responsible for delay or non performance hereunder if
performance is prevented or delayed by any cause or event beyond such Party’s
reasonable control. Without limiting the generality of the foregoing, such
causes or events shall include, directly or indirectly, without limitation, Acts
of God or elements of nature, fire, floods, other catastrophes, war, public
enemies, seizure under legal process (not resulting from action or inaction of
the non-performing Party), strikes, lockouts, labor disorders, riots, sabotage,
explosion, acts of terrorism, civil commotions, closing of public highways,
governmental interference or regulations, embargo, accident, derailment,
epidemics or quarantine restrictions, the act or default of the other Party, or
any other reason of a similar or dissimilar nature beyond such Party’s
reasonable control.
     In the event there is a default or delay due to Force Majeure per the
above, the non-performing Party shall be excused from further performance (other
than payment of previously accrued charges) or observance of the obligation(s)
so affected for as long as such circumstances prevail, provided such Party
continues to use its commercially reasonable efforts to recommence its
performance or observance whenever and to whatever extent possible without
delay. Warehouseman shall use its commercially reasonable efforts to protect the
Products that are in the Warehouse during the Force Majeure event. The Party
claiming a Force Majeure event will notify the other Party as soon as
practicable regarding the existence, nature and approximate duration of the
Force Majeure event, and will promptly give further notice when the Force
Majeure event ceases, whereupon its duty to perform shall resume.
ARTICLE 8
DEFAULT
     8.1 Automatic Default. In the event bankruptcy, receivership, insolvency,
reorganization, dissolution, liquidation or other similar proceeding is
instituted by or against either Party under the United States Bankruptcy Code or
other law of the United States or any state, then this Agreement shall be deemed
to be automatically terminated by the other Party, without notice or demand, and
such other Party may exercise all rights granted under applicable law and this
Agreement.
     8.2 General Default; Right to Cure. Except for reasons provided in
Article 7 and Section 8.1 above, in the event either Party fails, in any
material respect, to perform its obligations under this Agreement, then the
other Party may terminate this Agreement upon sixty (60) days prior written
notice to the other; provided, however, that such notice shall specify all such
failures to perform and allow the Party in default no less than thirty (30) days
to correct such failures. However, Warehouseman and Crown Crafts agree that
breach of payment terms in Article 4 shall constitute a default, which shall
give Warehouseman the right to terminate this Agreement by written notice to
Crown Crafts if such default is not remedied within five (5) days of such
notice.

 

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     8.3 Effect of Termination. Termination under this provision, or under any
other provision of this Agreement, shall not relieve or release either Party
from any liability or obligation, which accrued prior to the date of such
termination.
ARTICLE 9
RECORDS
     Warehouseman shall at all times keep accurate and complete books and
records with regard to receipt, transfer, and other handling of Products (the
“Crown Crafts Files”) and shall maintain the Crown Crafts Files for a period of
two (2) years. Subject to maintaining the confidentiality of records of any
customers other than Crown Crafts, Crown Crafts and its authorized
representatives shall have the right, at its own cost and expense, to inspect
and audit the Crown Crafts Files at any reasonable time. Crown Crafts’ right to
audit the Crown Crafts Files shall survive expiration or termination of this
Agreement. Crown Crafts shall have the right to enter upon the Warehouse at all
reasonable times for the purpose of inspecting Products; provided that any such
inspection by Crown Crafts or its agents or employees shall be conducted in such
a manner so as not to interfere with the normal operations of the Warehouseman.
ARTICLE 10
INDEPENDENT CONTRACTOR
     It is agreed and understood that Warehouseman is entering into this
Agreement as an independent contractor, that all of Warehouseman’s personnel
engaged in work under this Agreement are to be considered for all purposes as
employees of Warehouseman, and that all of Crown Craft’s personnel engaged in
work at the Warehouse are to be considered for all purposes as employees of
Crown Crafts. Under no circumstances shall employees of Warehouseman be
construed or considered to be employees of Crown Crafts or employees of Crown
Crafts be construed or considered to be employees of Warehouseman. Each party
hereto agrees to furnish, at the other party’s request, evidence of such party’s
workers’ compensation insurance with respect to its employees as then in effect.
Crown Crafts will not be responsible for acts or omissions of any of
Warehouseman’s employees or agents. The relationship between the Parties will
be, at all times, that of independent contractors, which status governs all
relationships between Warehouseman, Crown Crafts and other third parties.
ARTICLE 11
COMPLIANCE
     Warehouseman shall at all times comply, in all material respects, with all
applicable federal, state and municipal laws and the regulations of the
respective regulatory bodies having jurisdiction over Warehouseman. Warehouseman
will procure and maintain all necessary and applicable operating authorities,
permits and licenses.

 

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ARTICLE 12
SUCCESSORSHIP
     This Agreement shall inure to the benefit of and be binding upon the
Parties hereto and their successors and assigns, provided neither Party to this
Agreement shall assign or sublet its interest or obligations herein without the
prior written consent of the other Party. Notwithstanding the foregoing, either
Party has the right to assign or subcontract part or all of the obligations
hereunder without the consent of the other Party so long as the assignee or
subcontractor is, and remains throughout the Term, a parent, affiliate or
subsidiary of such Party.
ARTICLE 13
APPLICABLE LAW; SEVERABILITY; SAVINGS
     Warehouseman and Crown Crafts understand and agree that the law of the
State of Delaware, without regard to principles of conflicts of law, shall
govern this Agreement. If any provision of this Agreement shall be held to be
invalid or unenforceable for any reason, the remaining provisions shall continue
to be valid and enforceable. If a court finds that any provision of this
Agreement is invalid or unenforceable, but that by limiting such provision it
would become valid and enforceable, then such provision shall be deemed to be
written, construed, and enforced as so limited.
ARTICLE 14
ENTIRE AGREEMENT; AMENDMENT; CAPTIONS
     This Agreement, together with all schedules and attachments, constitutes
the entire agreement between the Parties with respect to the subject matter
hereof and may not be amended or changed except by written agreement signed by
Warehouseman and Crown Crafts. To the extent that the terms of any warehouse
receipts, acknowledgment forms, order forms, bills of lading, invoices, or
similar documents sent and/or signed by one or both Parties conflict with or are
inconsistent with the terms of this Agreement, the terms of this Agreement shall
control. The captions herein are for convenience only and shall not be construed
as interpretive or as a substantive part of this Agreement.
ARTICLE 15
NOTICES
     Any notice or demand required or permitted hereunder shall be given in
writing addressed to Crown Crafts or Warehouseman as listed below or to such
other address as may be specified in writing to the other Party. All such
communications shall be deemed given if (a) delivered by hand, (b) mailed by
registered or certified mail (return receipt requested), (c) by deposit with a
nationally recognized courier for next business day delivery, or (d) faxed and
immediately confirmed both orally and in writing, to the parties at the
following addresses (or at such other addresses for a party as shall be
specified by like notice) and shall be deemed given

 

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on the date on which so hand-delivered or so telecommunicated or the next
business day following deposit with such courier or on the third business day
following the date on which so mailed, if deposited in a regularly-maintained
receptacle for United States mail:
For notices to Warehouseman:
Springs Global US, Inc.
205 North White Street
Fort Mill, South Carolina 29715
Attn: Mr. Tom O’Connor
Fax: (803) 547-1688
     With a copy to (which shall not constitute notice to Warehouseman):
Springs Global US, Inc.
205 North White Street
Fort Mill, South Carolina 29715
Attn: Legal Department
Fax: (803) 547-3766
For notices to Crown Crafts:
Crown Crafts Infant Products, Inc.
916 S. Burnside Avenue
Gonzales, Louisiana 70737
Attn: Mr. E. Randall Chestnut
Fax: (225) 647-9112
     With a copy to (which shall not constitute notice to Crown Crafts):
Rogers & Hardin LLP
2700 International Tower
229 Peachtree Street, NE
Atlanta, Georgia 30303
Attn: Steven E. Fox, Esq.
Fax: (404) 525-2224
ARTICLE 16
WAIVER
     Compliance with the provisions of this Agreement may be waived only by a
written document signed by the Party granting the waiver. The failure of either
Party at any time to require performance by the other Party of any provision
hereof shall in no way affect the full right to require such performance at any
time thereafter. Neither shall the waiver by any Party of a breach of any
provision hereof be taken or held to be a waiver of any succeeding breach of
such provision or as a waiver of the provision itself.

 

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ARTICLE 17
EXECUTION IN COUNTERPARTS; FACSIMILE SIGNATURES
     This Agreement may be executed in one or more counterparts, all of which
shall be considered one and the same agreement, and shall become a binding
agreement when one or more counterparts have been signed by each party and
delivered to the other parties. A signature to this Agreement delivered by
telecopy or other electronic communication shall be deemed an original signature
for all purposes hereunder.
[Signature page follows.]

 

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     IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized representatives as of the date first set
forth above.

             
 
                SPRINGS GLOBAL US, INC.
 
           
 
  By:   /s/ Flavio R. Barbosa      
 
  Name:   Flavio R. Barbosa      
 
  Title:   EVP & CFO      
 
  Date:   11/5/07      
 
                CROWN CRAFTS INFANT PRODUCTS, INC.
 
           
 
  By:   /s/ E. Randall Chestnut      
 
  Name:   E. Randall Chestnut      
 
  Title:   Vice President    
 
           
 
  Date:   11/5/07      

[Signature page for Warehousing Agreement—SGUS/Crown Crafts]

 

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EXECUTION COPY
SCHEDULE A
Description of Services

(1)   Location(s): 1495 East Locust Street, Ontario, California 91761   (2)  
Warehouse Services to Include: (All Services will be in accordance with
Warehouseman standard warehouse operating procedures and standards unless
specifically modified in this Agreement or any Schedule):

  A.   Warehouse Services to include:  

  (1)   receipt of Product into Warehouseman warehouse inventory system,     (2)
  forward receipt information to Crown Crafts for entry into Crown Crafts
inventory system     (3)   devanning containers,     (4)   unloading,     (5)  
sorting,     (6)   storing,     (7)   pick orders according to Crown Crafts pick
ticket instructions,     (8)   pick and pack according to Crown Crafts pick
ticket instructions,     (9)   palletizing,     (10)   inspecting in a manner
consistent with Warehouseman’s existing quality control process that existed
prior to the Closing Date (as defined in the Asset Purchase Agreement),     (11)
  labeling according to Crown Crafts instructions,     (12)   handling,     (13)
  repacking,     (14)   rehandling inventory according to Crown Crafts
instructions     (15)   consolidating,     (16)   routing,     (17)   staging,  
  (18)   loading on outbound trailer     (19)   adjusting inventory out of
Warehouseman warehouse inventory system     (20)   provide Crown Crafts with
completed pick tickets for entry into Crown Crafts inventory system     (21)  
set up new SKU’s in Warehouseman warehouse inventory system     (22)   provide
daily or, if agreed by the Parties, less frequent reporting of ending inventory
and periodic activity by transaction code to Crown Crafts for reconciliation
with Crown Crafts’ inventory system, and     (23)   cycle counting according to
Crown Crafts instructions

(3)   Normal Workday Operating Hours: 5:00 AM PST to 1:30 PM PST

 

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Normal Workday Operating Hours to exclude the following holidays: New Years Day,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day, the day after
Thanksgiving, Christmas Eve, Christmas Day.

 

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SCHEDULE B
Rate Schedule

  (1)   Rates for Warehouse Services:

                  Regular   Overtime   Holidays
Hourly:
           
 
           
Quality Reinspectors,
  $11.00 per hour   1.5 times the Regular   Approx 2.0 times the
Order Fillers & Lift
      Rate   Regular Rate
Truck Operators
           
A-3 Inventory Clerk
  $11.83 per hour   1.5 times the Regular   Approx 2.0 times the
 
      Rate   Regular Rate
A-5 Inventory Clerk
  $14.14 per hour   1.5 times the Regular   Approx 2.0 times the
 
      Rate   Regular Rate  
Salary:
             
Baby Supervisor
  $4,693 per 4 week
month, $5,866 per 5
week month          
Allocated DC Manager,
Industrial Engineer and
Second Shift Supervisor
  $7,676 per 4 week
month, $9,595 per 5
week month        

Hourly rates are exclusive of Warehouseman fringe benefits. Fringe benefits will
be charged to Crown Crafts at a fixed rate of 40% of the Regular Hourly charges
incurred each month. Temporary labor, if necessary, will be billed to Crown
Crafts at the actual cost billed to Warehouseman. Crown Crafts will only be
responsible for Hourly and Salary charges to the extent Warehouse Services are
provided to Crown Crafts during any month in the Term.

  (2)   Rates for Distribution Materials, Office Supplies or Special Supplies
used for Crown Crafts:         Actual cost.     (3)   Utilities, Taxes,
Maintenance and Insurance;

     Any charges for Utilities, Taxes, Maintenance and Insurance shall be passed
through to Crown Crafts on a prorated basis each month throughout the Term. Such
additional charges may include, but are not limited to Warehouseman’s actual
costs for gas, oil, propane, diesel fuel, electricity, water, sewer, telephone,
security, property taxes, property insurance, business insurance and building
maintenance. Crown Crafts’ prorated share of such total expense shall be
commensurate with Crown Crafts’ portion of the square footage for the entire
Warehouse.

 

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  (4)   Lease Costs;

     Warehouseman’s actual warehouse lease costs (currently $58,041 per month)
will be passed through to Crown Crafts on a prorated basis each month throughout
the Term. Crown Crafts prorated share of such total expenses will be based on
the percentage calculated by dividing the square footage of the Warehouse that
was allocated to Warehouseman’s baby products line prior to the date hereof into
the total square footage of the Warehouse.
     Warehouseman’s actual costs throughout the Term for leased equipment
including lift trucks, handling equipment, copiers, faxes and other office
equipment dedicated to Warehouseman’s baby products line prior to the date
hereof (currently $2,852 per month) will be passed through to Crown Crafts.

 

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SCHEDULE C
Insurance Schedule
A Certificate of Insurance naming Crown Crafts as Certificate Holder is attached
hereto as Attachment C-1.
A Certificate of Insurance naming Warehouseman as Certificate Holder is attached
hereto as Attachment C-2.