Exhibit 10.1
SUPPORT AGREEMENT
     SUPPORT AGREEMENT (the “Agreement”) dated as of August 17, 2006, between
BARRON CAPITAL ADVISORS, LLC, a Delaware limited liability company (“Barron”),
and CROWN CRAFTS, INC., a Delaware corporation (the “Company”).
     WHEREAS, the Barron Group (as hereinafter defined) currently owns an
aggregate of 223,900 shares of the Company’s Series A Common Stock, par value
$1.00 per share (such class of common stock being referred to herein as “Common
Stock”);
     WHEREAS, the Barron Group wishes to acquire additional shares of Common
Stock without triggering the operation of the Company’s Shareholder Rights Plan
(the “Rights Plan”), as set forth in that certain Amended and Restated Rights
Agreement dated as of August 6, 2003 between the Company and Computershare
Investor Services, LLC (as successor to SunTrust Bank), as amended, and the
Company is willing to permit Barron to do so as long as the Company can be
assured of a constructive and mutually beneficial relationship between it and
Barron; and
     WHEREAS, in order to assure this type of relationship, the Company and
Barron wish to enter into this Agreement;
     NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises, representations, warranties, covenants and agreements set forth
herein, the parties, intending to be legally bound, hereby agree as follows:
1.    TERM OF AGREEMENT
     The respective covenants and agreements of Barron and the Company contained
in this Agreement will continue in full force and effect until September 1, 2011
(the “Termination Date”), unless earlier terminated pursuant to paragraph 5 or
subparagraph 6(b) hereof or pursuant to the mutual written consent of Barron and
the Company.
2.    COVENANTS OF BARRON
     Prior to the Termination Date or earlier termination of this Agreement and
subject to the further provisions hereof:
     (a)      Neither Barron nor any person “controlled by” (within the meaning
of Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) Barron (collectively and together with Barron, the “Barron
Group”) will, directly or indirectly, acquire any Voting Securities (as
hereinafter defined) (except by way of stock dividends or other distributions or
offerings made available to holders of Voting Securities generally) if the
effect of such acquisition would be to increase the aggregate voting power of
all Voting Securities then owned by all members of the Barron Group to greater
than 9.9% of such total combined voting power of all Voting Securities then
outstanding; provided that this subparagraph shall not apply if and to the
extent that such aggregate percentage ownership is increased as a result of a
recapitalization or reincorporation of the Company, any redemption of Voting
Securities by the

 

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Company, or any other action taken by the Company or its affiliates (as
hereinafter defined) other than the Barron Group.
     (b)      Barron shall take such action as may be required so that all
Voting Securities owned by any member of the Barron Group are voted (whether by
proxy or otherwise) in favor of management’s nominees to the Board of Directors
of the Company (the “Board”) and, unless the Company otherwise consents in
writing, on all other matters to be voted on by the holders of Voting Securities
in the same proportion as the votes cast by the other holders of Voting
Securities other than any holder who is a member of a Prohibited Stockholder
Group (as hereinafter defined). The members of the Barron Group, as holders of
Voting Securities, shall be present, in person or by proxy, at all meetings of
stockholders of the Company called with respect to the foregoing and of which
the Barron Group has received due notice, so that all Voting Securities
beneficially owned by them may be counted for the purpose of determining the
presence of a quorum at such meetings.
     (c)      No member of the Barron Group shall deposit any Voting Securities
in a voting trust or subject any Voting Securities to any arrangement or
agreement (other than this Agreement) with respect to the voting of such Voting
Securities to which any of the following persons (collectively, the “Prohibited
Stockholder Group”) is a party: (i) any holder of 5% or more of all Voting
Securities then outstanding (a “Prohibited Stockholder”) or any person who any
member of the Barron Group knows to be an affiliate, associate (as hereinafter
defined) or relative of any Prohibited Stockholder or any 13D Group (as
hereinafter defined) of any Prohibited Stockholder; or (ii) any person who, to
the knowledge of any member of the Barron Group, is casting votes in respect of
Voting Securities beneficially owned by a Prohibited Stockholder.
Notwithstanding the foregoing, no officer or director of the Company who holds
5% or more of any Voting Securities shall be deemed a Prohibited Stockholder for
purposes of this Agreement.
     (d)      No member of the Barron Group shall solicit proxies or become a
“participant” in a “solicitation” (as such terms are defined in Regulation 14A
under the Exchange Act) made by any member of a Prohibited Stockholder Group or
that is otherwise in opposition to the recommendation of the majority of the
directors of the Company with respect to any matter.
     (e)      No member of the Barron Group shall, for the purpose of, or in
connection with, acquiring, holding, voting or disposing of Voting Securities:
(i) join a partnership, limited partnership, syndicate or other group of which,
to its knowledge, any member of a Prohibited Stockholder Group is, directly or
indirectly, a partner, member or participant; (ii) otherwise act in concert with
any person who it knows to be a member of a Prohibited Stockholder Group; or
(iii) otherwise become, together with any person who it knows to be a member of
a Prohibited Stockholder Group, a “person” within the meaning of
Section 13(d)(3) of the Exchange Act (in each case other than solely with
members of the Barron Group).
     (f)      No member of the Barron Group shall, directly or indirectly,
offer, sell or transfer any Voting Securities to any person who it knows to be a
member of a Prohibited Stockholder Group; provided, however, that nothing herein
shall restrict any member of the Barron Group from selling (in open market
transactions or otherwise) any Voting Securities to any person who it does not
know to be a member of a Prohibited Stockholder Group.

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     (g)      No member of the Barron Group shall otherwise seek to control the
management or policies of the Company, including taking any action to seek to
obtain representation on the Board.
3.    REPRESENTATIONS AND WARRANTIES
     (a)      The Company hereby represents and warrants to Barron as follows:
     (i) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware.
     (ii) The Company has full legal right, power and authority to enter into
and perform this Agreement, and the execution and delivery of this Agreement by
the Company and the consummation of the transactions contemplated hereby have
been duly authorized by the Board.
     (iii) This Agreement constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except
that (A) such enforcement may be subject to applicable bankruptcy, insolvency or
other similar laws, now or hereafter in effect, affecting creditors’ rights
generally, and (B) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
     (b)      Barron hereby represents and warrants to the Company as follows:
     (i)      Barron is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of Delaware.
     (ii)      Barron has full legal right, power and authority to enter into
and perform this Agreement, and the execution and delivery of this Agreement by
Barron and the consummation by Barron of the transactions contemplated hereby
have been duly authorized by the managers of Barron.
     (iii)      This Agreement constitutes a valid and binding agreement of
Barron, enforceable against Barron in accordance with its terms, except that
(A) such enforcement may be subject to applicable bankruptcy, insolvency or
other similar laws, now or hereafter in effect, affecting creditors’ rights
generally, and (B) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
     (iv)      As of the date hereof, the Barron Group owns of record and
beneficially an aggregate of 223,900 shares of Common Stock (the “Existing
Shares”), and the Existing Shares constitute all of the shares of the Company’s
capital stock owned of record or beneficially by the Barron Group. There are no
outstanding options or other rights to acquire from Barron, or obligations of
Barron to sell or to acquire, any shares of the Company’s capital stock. Barron
has, directly or indirectly, the voting power, power

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of disposition and power to agree to all of the matters set forth in this
Agreement, in each case with respect to all of the Existing Shares with no
limitations, qualifications or restrictions of any kind whatsoever, subject to
applicable securities laws and the terms of this Agreement.
4.    CERTAIN DEFINITIONS
     For purposes of this Agreement, unless the context otherwise requires:
                (a)      “affiliate” and “associate” shall each have the meaning
set forth with respect thereto in Rule 12b-2 under the Exchange Act;
                (b)      “beneficially own”, “beneficial ownership” and
“beneficial owner” with respect to any securities means having “beneficial
ownership” of such securities, as determined pursuant to Rule 13d-3 under the
Exchange Act, without duplicative counting of the same securities by the same
holder (it being understood that securities beneficially owned by a person
include securities beneficially owned by all other persons with whom such person
would constitute a “13D Group” with respect to securities of the same issuer);
                (c)      “person” shall mean any individual, partnership,
corporation, limited liability company, trust or other entity or association;
                (d)      “13D Group” shall mean any group of persons formed for
the purpose of acquiring, holding, voting or disposing of Voting Securities
which would be required under Section 13(d) of the Exchange Act and the rules
and regulations thereunder (as now in effect and based on present legal
interpretations thereof) to file a statement on Schedule 13D with the Securities
and Exchange Commission as a “person” within the meaning of Section 13(d)(3) of
the Exchange Act if such group beneficially owned Voting Securities representing
more than 5% of the total combined voting power of all Voting Securities then
outstanding; and
                (e)      “Voting Securities” shall mean all classes of capital
stock of the Company entitled to vote generally in the election of directors.
5.    TERMINATION
     Notwithstanding any other provision of this Agreement, either party may
terminate this Agreement, in its sole discretion, if the members of the Barron
Group own, in the aggregate, Voting Securities representing less than 1% of all
outstanding Voting Securities.
6.    MISCELLANEOUS
     (a)      Barron, on the one hand, and the Company, on the other,
acknowledge and agree that irreparable damage would occur in the event any of
the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to prevent breaches of
the provisions of this Agreement and to enforce specifically the terms and
provisions hereof in any court of the United States or any state thereof having
jurisdiction, in addition to any other remedy to which they may be entitled at
law or equity.

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     (b)      If any provision of this Agreement is in violation of any statute,
rule, regulation, order or decree of any governmental authority, court or
agency, or subjects any member of the Barron Group to governmental regulation to
which it is not now subject, which violation or regulation would have a material
adverse impact on the operations of the Barron Group taken as a whole, then such
member of the Barron Group shall be relieved of its obligations under such
provision to the minimum extent necessary to cure such violation or eliminate
the applicability of such regulation; provided that this subparagraph shall not
apply to any such violation or regulation resulting from activities or
operations of any member of the Barron Group other than its ownership of Voting
Securities and the consummation of the transactions contemplated by this
Agreement; and provided further that in the event any member of the Barron Group
is relieved of its obligations under any provision of this Agreement pursuant to
this subparagraph, the Company may terminate this Agreement in its sole
discretion.
     (c)      This Agreement contains the entire understanding of the parties
with respect to the transactions contemplated hereby, and this Agreement may be
amended only by an agreement in writing executed by the parties hereto.
     (d)      Descriptive headings are for convenience only and shall not
control or affect the meaning or construction of any provision of this
Agreement.
     (e)      For the convenience of the parties, any number of counterparts of
this Agreement may be executed by the parties hereto and each such executed
counterpart shall be, and shall he deemed to be, an original instrument.
Executed counterparts may be delivered by facsimile transmission or other
electronic medium.
     (f)      All notices, consents, requests, instructions, approvals and other
communications provided for herein and all legal process in regard hereto shall
be in writing and shall be deemed given upon (i) transmitter’s confirmation of a
receipt of a facsimile transmission, (ii) confirmed delivery by a standard
overnight carrier or when delivered by hand, or (iii) the expiration of five
(5) business days after the day when mailed by certified or registered mail,
postage prepaid, addressed at the following addresses (or at such other address
for a party as shall be specified by like notice):

      THE COMPANY:
 
   
 
  Crown Crafts, Inc.
 
  P.O. Box 1028
 
  Gonzales, Louisiana 70707-1028
 
  Attn: E. Randall Chestnut
 
  Facsimile No.: (225) 647-9112
 
    BARRON:
 
   
 
  Barron Capital Advisors, LLC
 
  730 Fifth Avenue, 25th Floor
 
  New York, New York 10019
 
  Attn: Andrew B. Worden
 
  Facsimile No.: (212) 359-0222

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     (g)      This Agreement will be binding upon, inure to the benefit of and
be enforceable by the parties and their respective successors and assigns.
     (h)      In the event of any stock split, stock dividend, merger,
recapitalization, reorganization or other change in the capital structure of the
Company affecting the Common Stock, this Agreement and the obligations hereunder
shall attach to any additional shares of Common Stock issued to Barron in
connection therewith.
     (i)      From and after the Termination Date or earlier termination of this
Agreement in accordance with the terms hereof, the covenants of the parties set
forth herein shall be of no further force or effect, and the parties shall be
under no further obligation with respect thereto.
     (j)      This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Delaware applicable to contracts made
and to be performed therein.
     (k)      This Agreement shall become effective as of the day first above
written.
     IN WITNESS WHEREOF, Barron and the Company have caused this Agreement to be
duly executed by their respective officers, each of whom is duly authorized, all
as of the day and year first above written.

            CROWN CRAFTS, INC.
      By:   /s/ E. Randall Chestnut         E. Randall Chestnut, President     
  and Chief Executive Officer     

            BARRON CAPITAL ADVISORS, LLC
      By:   /s/ Andrew Barron Worden         Name:   Andrew Barron Worden       
Title:   Managing Partner     

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