##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 27, 2009
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from _____ to _____
 Commission File No. 1-7604
 CROWN CRAFTS, INC.
  Delaware
    
    58-0678148(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 916 South Burnside Avenue, Gonzales, Louisiana 70737
 (Registrants telephone number, including area code)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-Accelerated filer o
    
    Smaller Reporting Company þ(Do not check if a smaller reporting company)
 o þ




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TABLE OF CONTENTS  PART I  FINANCIAL INFORMATIONITEM 1. FINANCIAL STATEMENTSITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 4T. CONTROLS AND PROCEDURESPART II  OTHER INFORMATIONITEM 1. LEGAL PROCEEDINGSITEM 1A. RISK FACTORSITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDSITEM 3. DEFAULTS UPON SENIOR SECURITIESITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSITEM 5. OTHER INFORMATIONITEM 6. EXHIBITSSIGNATUREIndex to ExhibitsExhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2    Table of Contents  
 
  
 
  
 September 27, 2009
    
    
    March 29, 2009(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    11,967
    
    
    $
    15,249Accounts receivable (net of allowances of
$1,378 at September 27, 2009 and $1,581 at
March 29, 2009):Due from factor
    
    
    13,322
    
    
    
    17,341Other
    
    
    1,568
    
    
    
    1,613Inventories, net
    
    
    13,428
    
    
    
    11,751Prepaid expenses
    
    
    946
    
    
    
    1,070Temporary investments  restricted
    
    
    502
    
    
    
    Assets held for sale
    
    
    550
    
    
    
    550Deferred income taxes
    
    
    787
    
    
    
    921Total current assets
    
    
    43,070
    
    
    
    48,495Property, plant and equipment  at cost:Vehicles
    
    
    58
    
    
    
    44Land, buildings and improvements
    
    
    206
    
    
    
    205Machinery and equipment
    
    
    2,579
    
    
    
    2,476Furniture and fixtures
    
    
    779
    
    
    
    7653,622
    
    
    
    3,490Less accumulated depreciation
    
    
    2,995
    
    
    
    2,816Property, plant and equipment  net
    
    
    627
    
    
    
    674Other assets:Goodwill
    
    
    864
    
    
    
    Intangible assets, net
    
    
    7,096
    
    
    
    5,515Deferred income taxes
    
    
    1,809
    
    
    
    1,655Other
    
    
    113
    
    
    
    188Total other assets
    
    
    9,882
    
    
    
    7,358Total Assets
    
    $
    53,579
    
    
    $
    56,527LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    4,315
    
    
    $
    6,118Accrued wages and benefits
    
    
    568
    
    
    
    894Accrued royalties
    
    
    1,475
    
    
    
    1,056Other accrued liabilities
    
    
    192
    
    
    
    813Current maturities of long-term debt
    
    
    21,320
    
    
    
    1,667Total current liabilities
    
    
    27,870
    
    
    
    10,548Non-current liabilities:Long-term debt
    
    
    1,752
    
    
    
    23,568Commitments and contingencies
    
    
    
    
    
    
    Shareholders equity:Preferred stock  $0.01 par value per share;
Authorized 1,000,000 shares; No shares issued
at September 27, 2009 and March 29, 2009
    
    
    
    
    
    
    Common stock  $0.01 par value per share;
Authorized 74,000,000 shares; Issued
10,136,940 shares at September 27, 2009 and
10,098,441 shares at March 29, 2009
    
    
    101
    
    
    
    101Additional paid-in capital
    
    
    40,477
    
    
    
    39,995Treasury stock  at cost - 981,971 shares at
September 27, 2009 and 889,051 shares at
March 29, 2009
    
    
    (3,333
    )
    
    
    (3,056
    )Accumulated deficit
    
    
    (13,288
    )
    
    
    (14,629
    )Total shareholders equity
    
    
    23,957
    
    
    
    22,411Total Liabilities and Shareholders Equity
    
    $
    53,579
    
    
    $
    56,527
 See notes to unaudited condensed consolidated financial statements.
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##### Table of Contents



Three Months Ended
    
    
    Six Months EndedSeptember 27, 2009
    
    
    September 28, 2008
    
    
    September 27, 2009
    
    
    September 28, 2008Net sales
    
    $
    21,713
    
    
    $
    23,759
    
    
    $
    39,448
    
    
    $
    43,514Cost of products sold
    
    
    17,205
    
    
    
    18,904
    
    
    
    30,965
    
    
    
    34,421Gross profit
    
    
    4,508
    
    
    
    4,855
    
    
    
    8,483
    
    
    
    9,093Marketing and administrative expenses
    
    
    2,993
    
    
    
    2,973
    
    
    
    5,879
    
    
    
    5,879Income from operations
    
    
    1,515
    
    
    
    1,882
    
    
    
    2,604
    
    
    
    3,214Other income (expense):Interest and amortization of debt discount and expense
    
    
    (204
    )
    
    
    (308
    )
    
    
    (400
    )
    
    
    (635
    )Other  net
    
    
    (45
    )
    
    
    38
    
    
    
    (39
    )
    
    
    50Income before income tax expense
    
    
    1,266
    
    
    
    1,612
    
    
    
    2,165
    
    
    
    2,629Income tax expense
    
    
    471
    
    
    
    614
    
    
    
    811
    
    
    
    1,006Income from continuing operations
    
    
    795
    
    
    
    998
    
    
    
    1,354
    
    
    
    1,623Income (loss) from discontinued operations  net of income taxes
    
    
    8
    
    
    
    37
    
    
    
    (13
    )
    
    
    31Net income
    
    $
    803
    
    
    $
    1,035
    
    
    $
    1,341
    
    
    $
    1,654Weighted average shares outstanding  basic
    
    
    9,182
    
    
    
    9,379
    
    
    
    9,196
    
    
    
    9,397Weighted average shares outstanding  diluted
    
    
    9,384
    
    
    
    9,650
    
    
    
    9,381
    
    
    
    9,670Basic earnings per share:Income from continuing operations
    
    $
    0.09
    
    
    $
    0.11
    
    
    $
    0.15
    
    
    $
    0.18Income (loss) from discontinued operations  net of income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total basic earnings per share
    
    $
    0.09
    
    
    $
    0.11
    
    
    $
    0.15
    
    
    $
    0.18Diluted earnings per share:Income from continuing operations
    
    $
    0.08
    
    
    $
    0.11
    
    
    $
    0.14
    
    
    $
    0.17Income (loss) from discontinued operations  net of income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total diluted earnings per share
    
    $
    0.08
    
    
    $
    0.11
    
    
    $
    0.14
    
    
    $
    0.17
 See notes to unaudited condensed consolidated financial statements.
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Six Months EndedSeptember
27, 2009
    
    
    September 28, 2008Operating activities:Net income
    
    $
    1,341
    
    
    $
    1,654Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation of property, plant and equipment
    
    
    148
    
    
    
    161Amortization of intangibles
    
    
    919
    
    
    
    877Deferred income taxes
    
    
    (20
    )
    
    
    (197
    )Gain on sale of property, plant and equipment
    
    
    
    
    
    
    (66
    )Discount accretion
    
    
    129
    
    
    
    120Stock-based compensation
    
    
    476
    
    
    
    382Changes in assets and liabilities:Accounts receivable
    
    
    4,901
    
    
    
    (191
    )Inventories, net
    
    
    (1,129
    )
    
    
    (1,106
    )Prepaid expenses
    
    
    176
    
    
    
    245Temporary investments  restricted
    
    
    (2
    )
    
    
    Other assets
    
    
    45
    
    
    
    (70
    )Accounts payable
    
    
    (2,152
    )
    
    
    74Accrued liabilities
    
    
    (528
    )
    
    
    165Net cash provided by operating activities
    
    
    4,304
    
    
    
    2,048Investing activities:Capital expenditures
    
    
    (89
    )
    
    
    (135
    )Purchase of temporary investments
    
    
    (500
    )
    
    
    Proceeds from disposition of assets
    
    
    
    
    
    
    86Payment to acquire the assets of Neat Solutions, Inc., net of liabilities assumed
    
    
    (4,434
    )
    
    
    Net cash used in investing activities
    
    
    (5,023
    )
    
    
    (49
    )Financing activities:Payments on long-term debt
    
    
    (1,250
    )
    
    
    (1,254
    )(Repayments) borrowings under revolving line of credit, net
    
    
    (1,042
    )
    
    
    3,837Purchase of treasury stock
    
    
    (277
    )
    
    
    (422
    )Issuance of common stock
    
    
    6
    
    
    
    6Net cash (used in) provided by financing activities
    
    
    (2,563
    )
    
    
    2,167Net (decrease) increase in cash and cash equivalents
    
    
    (3,282
    )
    
    
    4,166Cash and cash equivalents at beginning of period
    
    
    15,249
    
    
    
    7,930Cash and cash equivalents at end of period
    
    $
    11,967
    
    
    $
    12,096Supplemental cash flow information:Income taxes paid
    
    $
    1,843
    
    
    $
    1,218Interest paid
    
    
    257
    
    
    
    439Noncash investing activity:Adjustment to purchase price of Springs Baby Products
from resolution of 
pre-acquisition contingency
    
    
    
    
    
    
    (58
    )
 See notes to unaudited condensed consolidated financial statements.
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Note 1  Summary of Significant Accounting Policies
 Basis of Presentation: FASB Accounting Standards Codification )
 Use of Estimates:
 Cash and Cash Equivalents:
 Financial Instruments:
 
    
    Cash and cash equivalents, accounts receivable and accounts payable  For those
short-term instruments, the carrying value is a reasonable estimate of fair value.
 
    
    Long-term debt  The carrying value of the Companys long-term debt approximates
fair value because interest rates under the Companys borrowings are variable, based on
prevailing market rates.
 Provisions for Income Taxes: Income Taxes
   4




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Segment and Related Information:
 Revenue Recognition:
 Allowances Against Accounts Receivable
    Depreciation and Amortization:
 Valuation of Long-lived and Identifiable Intangible Assets:
 Royalty Payments:
 Earnings Per Share: Earnings per Share
  5




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Three-Months Ended
    
    
    Six-Months EndedSeptember 27, 2009
    
    
    September 28, 2008
    
    
    September 27, 2009
    
    
    September 28, 2008(Amounts in thousands, except per share data)Income from continuing operations
    
    $
    795
    
    
    $
    998
    
    
    $
    1,354
    
    
    $
    1,623Income (loss) from discontinued operations
    
    
    8
    
    
    
    37
    
    
    
    (13
    )
    
    
    31Net income
    
    $
    803
    
    
    $
    1,035
    
    
    $
    1,341
    
    
    $
    1,654Weighted average number of common shares
outstandingBasic
    
    
    9,182
    
    
    
    9,379
    
    
    
    9,196
    
    
    
    9,397Effect of dilutive securities
    
    
    202
    
    
    
    271
    
    
    
    185
    
    
    
    273Diluted
    
    
    9,384
    
    
    
    9,650
    
    
    
    9,381
    
    
    
    9,670Basic earnings per common shareContinuing operations
    
    $
    0.09
    
    
    $
    0.11
    
    
    $
    0.15
    
    
    $
    0.18Discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    $
    0.09
    
    
    $
    0.11
    
    
    $
    0.15
    
    
    $
    0.18Diluted earnings per common shareContinuing operations
    
    $
    0.08
    
    
    $
    0.11
    
    
    $
    0.14
    
    
    $
    0.17Discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    $
    0.08
    
    
    $
    0.11
    
    
    $
    0.14
    
    
    $
    0.17
 Recently Issued Accounting Standards: Fair Value Measurements and Disclosures,
 Financial Instruments
 Business Combinations
 Subsequent Events
  6




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Generally Accepted Accounting Principles
 Note 2  Acquisition
 ® ®
 AmountTangible assets:Accounts receivable
    
    $
    837Inventory
    
    
    548Prepaid expenses
    
    
    52Fixed assets
    
    
    12Other assets
    
    
    2Total tangible assets
    
    
    1,451Amortizable intangible assets:Trademarks
    
    
    892Designs
    
    
    33Non-compete covenant
    
    
    241Customer relationships
    
    
    1,302Total amortizable intangible assets
    
    
    2,468Goodwill
    
    
    864Total acquired assets
    
    
    4,783Liabilities assumed  accounts payable
    
    
    349Net acquisition cost
    
    $
    4,434
 Note 3  Temporary Investments  Restricted
  Note 4  Stock-based Compensation
   7




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Compensation 
Stock Compensation
 Stock Options:
 Weighted-Average
    
    
    Number of OptionsExercise Price
    
    
    OutstandingOutstanding at March 29, 2009
    
    $
    2.54
    
    
    
    819,831Granted
    
    
    3.02
    
    
    
    170,000Exercised
    
    
    (0.77
    )
    
    
    (8,499
    )Forfeited
    
    
    (0.53
    )
    
    
    (3,500
    )Outstanding at September 27, 2009
    
    
    2.64
    
    
    
    977,832Exercisable at September 27, 2009
    
    
    2.42
    
    
    
    707,832
  Options Issued
    
    
    170,000Dividend Yield
    
    
    Expected Volatility
    
    
    50.00
    %Risk free interest rate
    
    
    2.70
    %Expected life in years
    
    
    5.75Forfeiture rate
    
    
    5.00
    %
  Three-month period
    
    
    Six-month periodCost of
    
    
    Marketing &
    
    
    
    
    
    
    Cost of
    
    
    Marketing &Products
    
    
    Administrative
    
    
    Total
    
    
    Products
    
    
    Administrative
    
    
    TotalSold
    
    
    Expenses
    
    
    Expense
    
    
    Sold
    
    
    Expenses
    
    
    ExpenseOptions granted in fiscal year 2008
    
    $
    7
    
    
    $
    19
    
    
    $
    26
    
    
    $
    16
    
    
    $
    41
    
    
    $
    57Options granted in fiscal year 2009
    
    
    11
    
    
    
    34
    
    
    
    45
    
    
    
    26
    
    
    
    78
    
    
    
    104Options granted in fiscal year 2010
    
    
    4
    
    
    
    11
    
    
    
    15
    
    
    
    4
    
    
    
    11
    
    
    
    15Total stock option compensation
    
    $
    22
    
    
    $
    64
    
    
    $
    86
    
    
    $
    46
    
    
    $
    130
    
    
    $
    176
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Three-month period
    
    
    Six-month periodCost of
    
    
    Marketing &
    
    
    
    
    
    
    Cost of
    
    
    Marketing &Products
    
    
    Administrative
    
    
    Total
    
    
    Products
    
    
    Administrative
    
    
    TotalSold
    
    
    Expenses
    
    
    Expense
    
    
    Sold
    
    
    Expenses
    
    
    ExpenseOptions granted in fiscal year 2007
    
    $
    12
    
    
    $
    36
    
    
    $
    48
    
    
    $
    23
    
    
    $
    73
    
    
    $
    96Options granted in fiscal year 2008
    
    
    11
    
    
    
    26
    
    
    
    37
    
    
    
    20
    
    
    
    49
    
    
    
    69Options granted in fiscal year 2009
    
    
    12
    
    
    
    37
    
    
    
    49
    
    
    
    15
    
    
    
    44
    
    
    
    59Unvested Options at April 3, 2006
    
    
    
    
    
    
    (1
    )
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    Total stock option compensation
    
    $
    35
    
    
    $
    98
    
    
    $
    133
    
    
    $
    58
    
    
    $
    166
    
    
    $
    224
 Non-vested Stock:
     Note 5  Inventories
  September 27, 2009
    
    
    March 29, 2009Raw Materials
    
    $
    158
    
    
    $
    30Finished Goods
    
    
    13,270
    
    
    
    11,721Total inventory
    
    $
    13,428
    
    
    $
    11,751
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Note 6  Financing Arrangements
 Factoring Agreements:
 Notes Payable and Other Credit Facilities:
 September 27, 2009
    
    
    March 29, 2009Revolving line of credit
    
    $
    19,020
    
    
    $
    20,062Term loan
    
    
    417
    
    
    
    1,667Non-interest bearing notes
    
    
    4,000
    
    
    
    4,000Original issue discount
    
    
    (365
    )
    
    
    (494
    )23,072
    
    
    
    25,235Less current maturities
    
    
    21,320
    
    
    
    1,667$
    1,752
    
    
    $
    23,568
  Revolving Line of Credit
  Term Loan
 Subordinated Notes
  10




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##### Table of Contents



Fiscal Year
    
    Revolver
    
    
    Term Loan
    
    
    Sub Notes
    
    
    Total2010
    
    $
    
    
    
    $
    417
    
    
    $
    
    
    
    $
    4172011
    
    
    19,020
    
    
    
    
    
    
    
    2,000
    
    
    
    21,0202012
    
    
    
    
    
    
    
    
    
    
    2,000
    
    
    
    2,000Total
    
    $
    19,020
    
    
    $
    417
    
    
    $
    4,000
    
    
    $
    23,437
 Note 7  Goodwill and Other Intangible Assets
 Goodwill: Intangibles  Goodwill and
Other
  Other Intangible Assets:
 Estimated
    
    
    
    
    
    Amortization ExpenseCarrying
    
    
    Useful
    
    Accumulated
    
    
    Three-month periods ended
    
    
    Six-month periods endedAmount
    
    
    Life
    
    Amortization
    
    
    September 27, 2009
    
    
    September 28, 2008
    
    
    September 27, 2009
    
    
    September 28, 2008Kimberly Grant acquisition on December 29, 2006:Tradename
    
    $
    466
    
    
    15 years
    
    $
    85
    
    
    $
    8
    
    
    $
    8
    
    
    $
    16
    
    
    $
    16Existing designs
    
    
    36
    
    
    1 year
    
    
    36
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Non-compete covenant
    
    
    98
    
    
    15 years
    
    
    17
    
    
    
    1
    
    
    
    2
    
    
    
    2
    
    
    
    3Total Kimberly Grant acquisition
    
    
    600
    
    
    
    
    
    138
    
    
    
    9
    
    
    
    10
    
    
    
    18
    
    
    
    19Springs Baby Products acquisition on November 5, 2007:Licenses & existing designs
    
    
    1,655
    
    
    2 years
    
    
    1,586
    
    
    
    207
    
    
    
    207
    
    
    
    414
    
    
    
    414Licenses & future designs
    
    
    1,847
    
    
    4 years
    
    
    885
    
    
    
    116
    
    
    
    116
    
    
    
    231
    
    
    
    231Non-compete covenant
    
    
    115
    
    
    4 years
    
    
    55
    
    
    
    7
    
    
    
    7
    
    
    
    14
    
    
    
    14Customer relationships
    
    
    3,781
    
    
    10 years
    
    
    727
    
    
    
    94
    
    
    
    96
    
    
    
    189
    
    
    
    191Total Springs Baby acquisition
    
    
    7,398
    
    
    
    
    
    3,253
    
    
    
    424
    
    
    
    426
    
    
    
    848
    
    
    
    850Neat Solutions acquisition on July 2, 2009:Trademarks
    
    
    892
    
    
    15 years
    
    
    15
    
    
    
    15
    
    
    
    
    
    
    
    15
    
    
    
    Designs
    
    
    33
    
    
    4 years
    
    
    2
    
    
    
    2
    
    
    
    
    
    
    
    2
    
    
    
    Non-compete covenant
    
    
    241
    
    
    5 years
    
    
    12
    
    
    
    12
    
    
    
    
    
    
    
    12
    
    
    
    Customer relationships
    
    
    1,302
    
    
    16 years
    
    
    20
    
    
    
    20
    
    
    
    
    
    
    
    20
    
    
    
    Total Neat Solutions acquisition
    
    
    2,468
    
    
    
    
    
    49
    
    
    
    49
    
    
    
    
    
    
    
    49
    
    
    
    Internally developed intangible assets
    
    
    91
    
    
    10 years
    
    
    21
    
    
    
    3
    
    
    
    7
    
    
    
    4
    
    
    
    8Total other intangible assets
    
    $
    10,557
    
    
    
    
    $
    3,461
    
    
    $
    485
    
    
    $
    443
    
    
    $
    919
    
    
    $
    877
 Note 8  Discontinued Operations
  Note 9  Subsequent Events
   11




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##### Table of Contents



Three-Month Period Ended
    
    
    
    
    
    
    
    
    
    
    Six-month period endedSeptember 27, 2009
    
    
    September 28, 2008
    
    
    Change
    
    
    Change
    
    
    September 27, 2009
    
    
    September 28, 2008
    
    
    Change
    
    
    ChangeNet sales by categoryBedding, blankets and accessories
    
    $
    16,233
    
    
    $
    20,071
    
    
    $
    (3,838
    )
    
    
    -19.1
    %
    
    $
    30,806
    
    
    $
    36,378
    
    
    $
    (5,572
    )
    
    
    -15.3
    %Bibs and bath
    
    
    5,480
    
    
    
    3,688
    
    
    
    1,792
    
    
    
    48.6
    %
    
    
    8,642
    
    
    
    7,136
    
    
    
    1,506
    
    
    
    21.1
    %Total net sales
    
    
    21,713
    
    
    
    23,759
    
    
    
    (2,046
    )
    
    
    -8.6
    %
    
    
    39,448
    
    
    
    43,514
    
    
    
    (4,066
    )
    
    
    -9.3
    %Cost of products sold
    
    
    17,205
    
    
    
    18,904
    
    
    
    (1,699
    )
    
    
    -9.0
    %
    
    
    30,965
    
    
    
    34,421
    
    
    
    (3,456
    )
    
    
    -10.0
    %Gross profit
    
    
    4,508
    
    
    
    4,855
    
    
    
    (347
    )
    
    
    -7.1
    %
    
    
    8,483
    
    
    
    9,093
    
    
    
    (610
    )
    
    
    -6.7
    %% of net sales
    
    
    20.8
    %
    
    
    20.4
    %
    
    
    
    
    
    
    
    
    
    
    21.5
    %
    
    
    20.9
    %Marketing and administrative expenses
    
    
    2,993
    
    
    
    2,973
    
    
    
    20
    
    
    
    0.7
    %
    
    
    5,879
    
    
    
    5,879
    
    
    
    0
    
    
    
    0.0
    %% of net sales
    
    
    13.8
    %
    
    
    12.5
    %
    
    
    
    
    
    
    
    
    
    
    14.9
    %
    
    
    13.5
    %Interest expense
    
    
    204
    
    
    
    308
    
    
    
    (104
    )
    
    
    -33.8
    %
    
    
    400
    
    
    
    635
    
    
    
    (235
    )
    
    
    -37.0
    %Other income (expense)
    
    
    (45
    )
    
    
    38
    
    
    
    (83
    )
    
    
    -218.4
    %
    
    
    (39
    )
    
    
    50
    
    
    
    (89
    )
    
    
    -178.0
    %Income tax expense
    
    
    471
    
    
    
    614
    
    
    
    (143
    )
    
    
    -23.3
    %
    
    
    811
    
    
    
    1,006
    
    
    
    (195
    )
    
    
    -19.4
    %Income from continuing operations after taxes
    
    
    795
    
    
    
    998
    
    
    
    (203
    )
    
    
    -20.3
    %
    
    
    1,354
    
    
    
    1,623
    
    
    
    (269
    )
    
    
    -16.6
    %Discontinued operations  net of taxes
    
    
    8
    
    
    
    37
    
    
    
    (29
    )
    
    
    -78.4
    %
    
    
    (13
    )
    
    
    31
    
    
    
    (44
    )
    
    
    -141.9
    %Net income
    
    
    803
    
    
    
    1,035
    
    
    
    (232
    )
    
    
    -22.4
    %
    
    
    1,341
    
    
    
    1,654
    
    
    
    (313
    )
    
    
    -18.9
    %% of net sales
    
    
    3.7
    %
    
    
    4.4
    %
    
    
    
    
    
    
    
    
    
    
    3.4
    %
    
    
    3.8
    %
  12




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##### Table of Contents



Net Sales:
    Gross Profit:
  Marketing and Administrative Expenses:
 Interest
Expense:
     13




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##### Table of Contents



14




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##### Table of Contents



The parent companies of the Companys factor and primary lender have filed voluntary
petitions for relief under Chapter 11 of the United States Bankruptcy Code.
   15




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##### Table of Contents



Approximate DollarTotal Number of
    
    
    Value of Shares ThatShares Purchased as
    
    
    May Yet beTotal Number of
    
    
    
    
    
    
    Part of Publicly
    
    
    PurchasedShares
    
    
    Average Price
    
    
    Announced Plans or
    
    
    Under the Plans orPeriod
    
    Purchased (1)
    
    
    Paid Per Share (2)
    
    
    Programs (3)
    
    
    Programs (3)June 29, 2009
through August 2,
2009
    
    
    0
    
    
    $
    0
    
    
    
    0
    
    
    $
    2,000,000August 3, 2009
through August 30,
2009
    
    
    92,920
    
    
    $
    2.98
    
    
    
    25,000
    
    
    $
    1,928,000August 31, 2009
through September
27, 2009
    
    
    0
    
    
    $
    0
    
    
    
    0
    
    
    $
    1,928,000Total
    
    
    92,920
    
    
    $
    2.98
    
    
    
    25,000
    
    
    $
    1,928,000
 (1)
    
    The shares purchased from August 3, 2009 through August 30, 2009 include 67,920 shares of
common stock surrendered to the Company to satisfy income tax withholding obligations in
connection with the vesting of shares of restricted stock.(2)
    
    Includes a broker fee of $0.03 per share paid to acquire 25,000 of the total 92,920 shares.(3)
    
    In July 2009, the Board of Directors of the Company authorized a share repurchase program,
pursuant to which the Company may spend up to $2.0 million in the aggregate to repurchase
from its stockholders shares of the outstanding common stock of the Company between July
7, 2009 and December 31, 2009; and further authorized the Company to determine the terms
and conditions under which any such repurchases would be made. During the three-month
period ended September 27, 2009, 25,000 shares were repurchased under the terms of the
share repurchase program at a price per share, including broker fees, of $2.88. 
 
   
 
   1.
    
    Election of two members to the board of directors to hold office for a three-year
term. The results of the voting were as follows:
 Director Nominee
    
    For
    
    
    Authority WithheldSidney Kirschner
    
    
    8,070,222
    
    
    
    101,288Zenon S. Nie
    
    
    8,060,066
    
    
    
    111,444
  16




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##### Table of Contents



Director
    
    Year Term ExpiringE. Randall Chestnut
    
    
    2010William T. Deyo, Jr
    
    
    2010Frederick G. Wasserman
    
    
    2010Donald Ratajczak
    
    
    2011Joseph Kling
    
    
    2011
 2.
    
    Approval of an amendment to the Companys 2006 Omnibus Incentive Plan to increase
the aggregate number of shares of Crown Crafts, Inc. Series A common stock subject to
award thereunder from 1,200,000 to 1,925,000. The results of the voting were as
follows:
 For
    
    Against
    
    
    Abstain
    
    
    Broker non-votes4,962,955
    
    
    1,169,480
    
    
    
    52,373
    
    
    
    1,986,702
 3.
    
    Transaction of such other matters as may properly come before the annual meeting
or any adjournment or postponement thereof. The results of the voting were as follows:
 For
    
    Against
    
    
    Abstain7,336,951
    
    
    687,253
    
    
    
    147,306
  
 
   
 
   ExhibitNo.
    
    Exhibit2.1
    
    
    Asset Purchase Agreement dated as of July 2, 2009 by and among Hamco., Inc., Neat
Solutions, Inc. and each of the shareholders of Neat Solutions, Inc. (1)10.1
    
    
    Third Amendment to Financing Agreement dated as of July 2, 2009 by and among the
Company, Churchill Weavers, Inc., Hamco, Inc., Crown Crafts Infant Products, Inc.
and The CIT Group/Commercial Services, Inc. (1)31.1
    
    
    Rule 13a-14(a)/15d-14(a) Certification by the Companys Chief Executive Officer (2)31.2
    
    
    Rule 13a-14(a)/15d-14(a) Certification by the Companys Chief Financial Officer (2)32.1
    
    
    Section 1350 Certification by the Companys Chief Executive Officer (2)32.2
    
    
    Section 1350 Certification by the Companys Chief Financial Officer (2)
 (1)
    
    Incorporated herein by reference to Registrants Current Report on Form 8-K
dated July 6, 2009.(2)
    
    Filed herewith.  17




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##### Table of Contents



CROWN CRAFTS, INC.Date:  November 10, 2009
    /s/ Olivia W. ElliottOLIVIA W. ELLIOTTChief Financial Officer
(Principal Financial Officer and 
Principal Accounting Officer) 
 
 Index to Exhibits
 ExhibitNo.
    
    Exhibit2.1
    
    
    Asset Purchase Agreement dated as of July 2, 2009 by and among Hamco., Inc., Neat
Solutions, Inc. and each of the shareholders of Neat Solutions, Inc. (1)10.1
    
    
    Third Amendment to Financing Agreement dated as of July 2, 2009 by and among the
Company, Churchill Weavers, Inc., Hamco, Inc., Crown Crafts Infant Products, Inc.
and The CIT Group/Commercial Services, Inc. (1)31.1
    
    
    Rule 13a-14(a)/15d-14(a) Certification by the Companys Chief Executive Officer (2)31.2
    
    
    Rule 13a-14(a)/15d-14(a) Certification by the Companys Chief Financial Officer (2)32.1
    
    
    Section 1350 Certification by the Companys Chief Executive Officer (2)32.2
    
    
    Section 1350 Certification by the Companys Chief Financial Officer (2)
 (1)
    
    Incorporated herein by reference to Registrants Current Report on Form 8-K
dated July 6, 2009.(2)
    
    Filed herewith.  18