Document:

<PAGE>   1
                  AMENDMENT NO. 4 TO REVOLVING CREDIT AGREEMENT

         THIS AMENDMENT NO. 4 TO REVOLVING CREDIT AGREEMENT (this "Amendment")
is dated effective as of August 31, 2000, among CROWN CRAFTS, INC. (the
"Borrower") and WACHOVIA BANK, N.A. (the "Lender");

                              W I T N E S S E T H:

         WHEREAS, the Borrower and the Lender executed and delivered that
certain Credit Agreement, dated as of August 9, 1999, as amended by Amendment
No. 1 to Revolving Credit Agreement dated as of February 23, 2000, Amendment No.
2 to Revolving Credit Agreement dated as of March 13, 2000 and Amendment No. 3
to Revolving Credit Agreement dated as of June 4, 2000 (as so amended, the
"Credit Agreement");

         WHEREAS, the Borrower has requested and the Lender has agreed to
certain amendments to certain provisions in the Credit Agreement, subject to the
terms and conditions hereof;

         NOW, THEREFORE, for and in consideration of the above premises and
other good and valuable consideration, the receipt and sufficiency of which
hereby is acknowledged by the parties hereto, the Borrower and the Lender hereby
covenant and agree as follows:

         1. Definitions. Unless otherwise specifically defined herein, each term
used herein which is defined in the Credit Agreement shall have the meaning
assigned to such term in the Credit Agreement. Each reference to "hereof",
"hereunder", "herein" and "hereby" and each other similar reference and each
reference to "this Agreement" and each other similar reference contained in the
Credit Agreement shall from and after the date hereof refer to the Credit
Agreement as amended hereby.

         2. Amendments to Credit Agreement.

         (a) Each of the following definitions contained in Section 1.1 of the
Credit Agreement is amended and restated in its entirety, and the definitions
which appear below and which have not previously been contained in Section 1.1
of the Credit Agreement hereby are added thereto, in alphabetical order as
follows:

                  "Applicable Interest Addition" means, from and after the
         Fourth Amendment Effective Date, 2.00%; provided that (i) if on January
         1, 2001, the aggregate principal amount of the Senior Debt has not been
         reduced below $85,000,000, additional interest in the amount of 2% (the
         "Contingent Interest") shall be added to and become a part of the
         Applicable Interest Addition and accrue on the Loans from and after
         January 1, 2001, but will not be payable until the Revolving A Credit
         Termination Date and Term Loan Maturity Date, (ii) if on February 15,
         2001, the aggregate principal amount of the Senior Debt has been
         reduced below $65,000,000, Contingent Interest shall not accrue on the
         Loans

<PAGE>   2

         after February 15, 2001 and shall no longer be a part of the Applicable
         Interest Addition thereafter and (iii) if on March 31, 2001 the
         aggregate principal amount of the Senior Debt has been reduced below
         $60,000,000, the entire claim for Contingent Interest on the Loans
         shall be waived.

                  "Borrowing Base" means, as determined by the most recent
         Borrowing Base Certificate, or, in the event such Borrowing Base
         Certificate is not timely delivered, based upon the Lender's good faith
         estimate thereof for such period to be reported on the date such
         Borrowing Base Certificate was due, an amount equal to the sum of the
         following:

                           (a)      all Net Receivables multiplied by 85%, less
         the amount of all Factor Advances which have been received from the
         applicable Permitted Factor; plus

                           (b)      the lesser of the book value (net of all
         reserves) or market value of all Inventory (excluding Mascioni
         Inventory), multiplied by 50% (and calculated in the Borrowing Base
         Certificate pursuant to the provisions of Section 7.1(g)); plus

                           (c)      the Applicable Property Value multiplied by
         80%; plus

                           (d)      the Overadvance Amount.

                  "Consolidated EBITDA" means, with respect to the Borrower and
         its Subsidiaries for any measurement period ending on the date of
         computation thereof, the sum of, without duplication, (i) Consolidated
         Net Income, (ii) Consolidated Interest Expense, (iii) taxes on income,
         (iv) amortization and (v) depreciation, all determined on a
         consolidated basis in accordance with GAAP applied on a Consistent
         Basis, but excluding one-time charges associated with divestitures,
         plant closures, severance, asset write-offs, employee retention and
         fees and expenses incurred by the Borrower in connection with the
         August 2000 Transaction Document Amendments (as defined in Section 32
         of the Intercreditor Agreement).

                  "Daily Borrowing Base Certificate" has the meaning set forth
         in Section 7.1(g).

                  "Daily Inventory Component Amount" has the meaning set forth
         in Section 7.1(g).

                  "Fourth Amendment Effective Date" means August 31, 2000.

                  "Inventory Component" has the meaning set forth in Section
         7.1(g).

                  "Mandatory Senior Debt Payments" has the meaning set forth in
         Section 2.8(b).

                                       2
<PAGE>   3

                  "Month End Inventory Component Amount" has the meaning set
         forth in Section 7.1(g).

                  "Month End Borrowing Base Certificate" has the meaning set
         forth in Section 7.1(g).

                  "Net Proceeds" means (a) in connection with any Restricted
         Asset Disposition, the proceeds thereof in the form of cash and cash
         equivalents (including any such proceeds received by way of deferred
         payment of principal pursuant to a note or installment receivable or
         purchase price adjustment receivable or otherwise, but only as and when
         received) of such Restricted Asset Disposition, after deducting
         therefrom, as applicable, (i) attorneys' fees, accountants' fees,
         investment banking fees, survey costs, title insurance premiums, and
         related search and recording charges, transfer taxes, deed or mortgage
         recording taxes, amounts required to be applied to the repayment of
         Indebtedness secured by a Lien on any asset which is the subject of
         such Restricted Asset Disposition and other customary fees and expenses
         actually incurred in connection therewith, (ii) taxes paid or
         reasonably estimated by the Borrower to be payable as a result thereof
         (including withholding taxes incurred in connection with cross-border
         transactions, if applicable), (iii) appropriate amounts to be provided
         by the Borrower or any Subsidiary, as the case may be, as a reserve
         required in accordance with GAAP against any liabilities associated
         with such Restricted Asset Disposition and retained by the Borrower or
         any Subsidiary, as the case may be, after such Restricted Asset
         Disposition, including, without limitation, pension and other
         post-employment benefit liabilities and liabilities under any
         indemnification obligations associated with such Restricted Asset
         Disposition, and (iv) amounts agreed upon by the Secured Parties in
         writing for employee retention and severance, (b) in connection with
         any Capital Market Transactions (but not including in "Net Proceeds"
         any replacements, refundings or refinancings of existing Indebtedness),
         the cash proceeds received from such issuance or incurrence, net of
         attorneys' fees, investment banking fees, accountants' fees,
         underwriting discounts and commissions and other customary fees and
         expenses actually incurred in connection therewith and (c) in
         connection with any Asset Disposition means cash payments received by
         the Borrower therefrom (including any cash payments received pursuant
         to any note or other debt security received in connection with any
         Asset Disposition) as and when received, net of (i) all legal fees and
         expenses and other fees and expenses paid to third parties and incurred
         in connection therewith, (ii) all taxes required to be paid or accrued
         as a consequence of such disposition, (iii) all amounts applied to
         repayment of Indebtedness (other than the Senior Debt) secured by a
         Lien on the asset or property disposed.

                  "Overadvance Amount" means, for the purposes of each
         calculation of the Borrowing Base, an amount equal to the following
         amounts for the corresponding period, provided, that the amounts set
         forth below are subject to adjustment satisfactory to the Lender and
         the Borrower following any material asset

                                       3
<PAGE>   4

         divestiture, to the extent necessary to take into account the effect
         thereon of any such divestiture:

<TABLE>
<CAPTION>
                                                                               Maximum Overadvance
                           Period                                                    Amount
                           ------                                              -------------------
                           <S>                                                 <C>
                           August 31, 2000 through September 4, 2000             $ 44,000,000
                           September 5, 2000 through September 11, 2000          $ 44,000,000
                           September 12, 2000 through September 18, 2000         $ 44,000,000
                           September 19, 2000 through September 25, 2000         $ 44,000,000
                           September 26, 2000 through October 2, 2000            $ 44,000,000
                           October 3, 2000 through October 9, 2000               $ 44,000,000
                           October 10, 2000 through October 16, 2000             $ 43,000,000
                           October 17, 2000 through October 23, 2000             $ 42,000,000
                           October 24, 2000 through October 30, 2000             $ 41,000,000
                           October 31, 2000 through November 6, 2000             $ 40,000,000
                           November 7, 2000 through November 13, 2000            $ 39,000,000
                           November 14, 2000 through November 20, 2000           $ 38,000,000
                           November 21, 2000 through  November 27, 2000          $ 37,000,000
                           November 28 ,2000 through December 3, 2000            $ 36,000,000
                           December 4, 2000 through December 10, 2000            $ 35,000,000
                           December 11, 2000 through December 17, 2000           $ 34,000,000
                           December 18, 2000 through December 24, 2000           $ 33,000,000
                           December 25, 2000 through December 31, 2000           $ 31,000,000
                           January 1, 2001 through February 4, 2001              $ 30,000,000
                           February 5, 2001 through March 4, 2001                $ 28,000,000
                           March 5, 2001 through April 1, 2001                   $ 27,000,000.
</TABLE>

                           "Restricted Asset Dispositions" means (i) any
                  Subsidiary Disposition and (ii) any Asset Dispositions (other
                  than an Asset Disposition referred to in clauses (a), (f) or
                  (g) of the definition of "Permitted Asset Dispositions",
                  provided that the proceeds therefrom shall be applied as
                  provided in Section 2.8(a).

                           "Revolving A Credit Termination Date" means (i) April
                  3, 2001 or (ii) such earlier date of the acceleration of any
                  Loans pursuant to Section 9.1 upon the occurrence of an Event
                  of Default, or (iii) such date as the Borrower may permanently
                  terminate the Revolving A Credit Facility by payment in full
                  of all Revolving A Credit Outstandings.

                           "Term Loan Maturity Date" means the earlier of (i)
                  April 3, 2001, or (ii) such earlier date of the acceleration
                  of any Loans pursuant to Section 9.1 upon the occurrence of an
                  Event of Default.

                           "Wachovia LC's" has the meaning set forth in Section
                  8.18.

                           "Warrants" has the meaning set forth in Section 8.17.

                                       4
<PAGE>   5

(b) Section 2.1(a) hereby is amended and restated in its entirety, as follows:

                  (a) No Further Commitments. The Borrower hereby acknowledges
         and agrees that the Lender no longer has any commitments to make
         further Advances hereunder, such commitments having been terminated,
         and any Loans by the Lender made after the Fourth Amendment Effective
         Date shall be made solely in the absolute discretion of the Lender, and
         shall constitute "Discretionary Loans" as defined in, and be made
         pursuant and subject to the terms and conditions of, the Intercreditor
         Agreement.

(c)      Section 2.3 hereby is amended and restated in its entirety, as follows:

                           2.3      .INTENTIONALLY OMITTED..

(d)      Section 2.8 hereby is amended and restated in its entirety, as follows:

                           2.8      Mandatory Prepayment.

                           (a)      The Borrower shall make, or shall cause each
                  applicable Subsidiary to make, a prepayment of Revolving
                  Credit Outstandings and the Term Loan from the Net Proceeds of
                  each Restricted Asset Disposition and each Capital Market
                  Transaction, except that such Net Proceeds shall (i) be
                  payable to the Collateral Agent as and when the aggregate
                  amount thereof since the last such payment of Net Proceeds
                  pursuant hereto is equal to or in excess of $50,000, and (ii)
                  be applied to reduce the amount of Mandatory Senior Debt
                  Payments required to be made pursuant to Section 2.8(b), with
                  such applications being applied in the order of maturity of
                  the Payment Dates set forth in Section 2.8(b). Such amounts
                  paid to the Collateral Agent shall be held by the Collateral
                  Agent, for the ratable benefit of the Secured Parties, and
                  distributed to the Secured Parties as and when the aggregate
                  amount held by it is at least equal to $250,000, or at such
                  earlier time as the Secured Parties may agree upon, all
                  pursuant to the provisions of Section 32 of the Intercreditor
                  Agreement.

                           (b)      The Borrower shall make payments of
                  principal outstanding on the Senior Debt to the Secured
                  Parties, prorata (calculated as provided in Section 32(c) of
                  the Intercreditor Agreement), in the following amounts on or
                  before the dates set forth below (the "Mandatory Senior Debt
                  Payments"):

<TABLE>
<CAPTION>
                           Payment Date                              Payment Amount
                           <S>                                         <C>
                           December 8, 2000                            $ 7,000,000
                           December 31, 2000                           $ 4,000,000
                           February 4, 2001                            $ 3,000,000
                           March 4, 2001                               $ 2,000,000
                           April 1, 2001                               $ 3,000,000
                                                                       -----------
                                    Total                              $19,000,000
</TABLE>

                                       5
<PAGE>   6

         (e) Section 7.1 hereby is amended amending and restating paragraphs (c)
and (g), thereof, and adding thereto new paragraphs (i) and (j), as follows:

                           (c)      Monthly Reporting. As soon as practicable
                  and in any event within 40 days (except for the Borrowing Base
                  Certificate pursuant to clause (ii) below, which shall be
                  delivered within 35 days) after the end of each month
                  beginning with the fiscal month ended July 31, 2000, deliver
                  to the Lender (i) a balance sheet of the Borrower and its
                  Subsidiaries as at the end of such month and the related
                  statements of income, stockholders' equity and cash flows for
                  such month, and accompanied by a certificate of an Authorized
                  Representative to the effect that such financial statements
                  present fairly in all material respects the financial position
                  of the Borrower and its Subsidiaries as of the end of such
                  month and the results of their operations and the changes in
                  their financial position for such month, in conformity with
                  GAAP applied on a Consistent Basis, subject to normal year-end
                  audit adjustments and the absence of footnotes, (ii) a
                  Borrowing Base Certificate (calculated showing the "Month End
                  Inventory Amount", as defined in and pursuant to the
                  provisions of Section 7.1(g)) and (iii) a certificate of an
                  Authorized Representative demonstrating compliance with
                  Sections 8.1(a) and 8.1(b) hereof, which certificate shall be
                  in the form attached hereto as Exhibit J hereto;

                           (g)      Updates of Borrowing Base Certificates. On
                  each Business Day, an uncertified, good faith estimated update
                  (a "Daily Borrowing Base Certificate") of the most recently
                  furnished monthly Borrowing Base Certificate furnished
                  pursuant to Section 7.1(c) (a "Month End Borrowing Base
                  Certificate") as to the information under the heading
                  "Accounts Receivable" pertaining to "Factored Accounts" and
                  "Factor Advances"; and the information under the heading
                  "Senior Debt". The Month End Borrowing Base Certificate shall
                  show, for the final line item under the heading INVENTORY
                  contained therein (the "Inventory Component"), the actual
                  Inventory Component calculated for such fiscal month (the
                  "Month End Inventory Component Amount"). The Inventory
                  Component shown on each Daily Borrowing Base Certificate (the
                  "Daily Inventory Component Amount") shall show the lesser of
                  (i) the Month End Inventory Component Amount for the most
                  recently furnished Month End Borrowing Base Certificate and
                  (ii) the Inventory Component amount for the relevant fiscal
                  month set forth below, provided, that the amounts set forth
                  below are subject to adjustment satisfactory to the Lender and
                  the Borrower following any material asset divestiture, to the
                  extent necessary to take into account the effect thereon of
                  any such divestiture:

<TABLE>
<CAPTION>
                           Fiscal Month Ended:                  Inventory Component Amount:
                           -------------------                  ---------------------------
                           <S>                                  <C>
                           September 3, 2000                           $32,000,000
                           October 1, 2000                             $29,000,000
                           November 5, 2000                            $27,000,000
                           December 3, 2000                            $26,000,000
                           December 31, 2000 and thereafter            $25,000,000
</TABLE>

                                       6
<PAGE>   7

                  The Month End Inventory Component Amount shown in a Month End
         Borrowing Base Certificate shall be used solely for purposes of
         calculating the Daily Inventory Component Amount on Daily Borrowing
         Base Certificates delivered thereafter pursuant to the foregoing until
         the delivery of the next Month End Borrowing Base Certificate, and the
         Inventory Component for purposes of calculating the Borrowing Base
         shall be the Daily Inventory Component Amount set forth in each Daily
         Borrowing Base Certificate.

                  (i)      Updates of Initiatives Summary. With respect to
         Initiatives Summary (as defined in the letter agreement among the
         Borrower and the Secured Parties dated as of June 27, 2000), the
         Borrower shall furnish to the Lender (i) on Thursday of each week, a
         weekly update of the Initiative Summary as to strategic initiatives and
         (ii) on the 7th Business Day of each month, a monthly update as to all
         other aspects of the Initiatives Summary.

                  (j)      Delivery of Outstanding Items. The items described on
         Appendix 1 hereto, which were to have been furnished to the Lender
         pursuant to Section 10(a) of Amendment No. 1 to Revolving Credit
         Agreement between the parties hereto, but have not yet been delivered,
         shall be delivered to the Lender (i) on or before November 30, 2000,
         with respect to the title policies described on Appendix 1 and (ii) on
         or before October 31, 2000, with respect to all other items.

(f) Section 8.1 is amended and restated in its entirety as follows:

                  8.1      Financial Covenants.

                  (a)      Capital Expenditures. Permit Capital Expenditures
         during the period from April 2, 2000 through the Term Loan Maturity
         Date to exceed $4,400,000.

                  (b)      Consolidated EBITDA. Permit cumulative Consolidated
         EBITDA as of the end of any fiscal month set forth below to be less
         than the amount set forth below opposite such date, provided, that the
         amounts set forth below are subject to adjustment satisfactory to the
         Lender and the Borrower following any material asset divestiture, to
         the extent necessary to take into account the effect thereon of any
         such divestiture:

<TABLE>
<CAPTION>
                                                                         Minimum
                                                                       Consolidated
                  Fiscal Month-End                                        EBITDA
                  ----------------                                      ----------
                  <S>                                                   <C>
                  July 2, 2000 (3 months)                               (4,750,000)
                  August 6, 2000                                        (5,700,000)
                  September 3, 2000                                     (4,100,000)
                  October 1, 2000                                         (750,000)
</TABLE>

                                       7
<PAGE>   8

<TABLE>
                  <S>                                                   <C>
                  November 5, 2000                                       2,750,000(1)
                  December 3, 2000                                       4,500,000
                  December 31, 2000                                      6,500,000
                  February 2, 2001                                       7,500,000
                  March 3, 2001                                         10,000,000
                  April 1, 2001                                         14,500,000
</TABLE>

         (g) Section 8.15 hereby is amended and restated in its entirety as
follows:

                  8.15     Factor Advances. Permit to exist any Factor Advances,
         other than Factor Advances from a Permitted Factor in an aggregate
         amount not exceeding the amount set forth below during the periods set
         forth below, provided, that the amounts set forth below are subject to
         adjustment satisfactory to the Lender and the Borrower following any
         material asset divestiture, to the extent necessary to take into
         account the effect thereon of any such divestiture:

<TABLE>
<CAPTION>
                                Month-End Date                       Factor Adv. Limit
                                --------------                       -----------------
                  <S>                                                <C>
                  August 31, 2000 through September 4, 2000             27,500,000
                  September 5, 2000 through September 11, 2000          28,000,000
                  September 12, 2000 through September 18, 2000         33,000,000
                  September 19, 2000 through September 25, 2000         34,000,000
                  September 26, 2000 through October 2, 2000            36,000,000
                  October 3, 2000 through October 9, 2000               36,000,000
                  October 10, 2000 through October 16, 2000             34,000,000
                  October 17, 2000 through October 23, 2000             32,000,000
                  October 24, 2000 through October 30, 2000             31,000,000
                  October 31, 2000 through November 6, 2000             27,000,000
                  November 7, 2000 through November 13, 2000            25,000,000
                  November 14, 2000 and thereafter                      24,000,000.
</TABLE>

         (h) Section 8.16 hereby is amended and restated in its entirety as
follows:

                           8.16 Prorata Payments to Secured Parties. Except as
                  to any Discretionary Loans (as defined in the Intercreditor
                  Agreement), notwithstanding any provision to the contrary
                  contained in any of the Senior Debt Documents or the
                  Intercreditor Agreement, the Borrower may not make any
                  principal payments to any of Secured Parties other than
                  pro-rata principal payments, and each Secured Party's pro-rata
                  share shall be calculated as provided in Section 32 of the
                  Intercreditor Agreement.

         (i) A new Section 8.17 hereby is added to the Credit Agreement as
follows:

---------------
         (1) This amount assumes receipt of the New York showroom rental income
in the amount of $1,021,000 during the fiscal month ending November 5. If such
amount is not received in such fiscal month, the Minimum Consolidated EBITDA for
the fiscal month ending November 5 will be decreased by such amount.

                                       8
<PAGE>   9

                  8.17     Warrants. By October 2, 2000, the Lender (or its
         affiliate designee) shall receive, together with the other Secured
         Parties (or their affiliate designees) without any further
         consideration payable, warrants, exercisable at nominal cost for the
         Borrower's common stock such that upon issuance the Secured Parties,
         collectively, shall own 10% (divided among the Secured Parties pro
         rata, without taking into account any outstanding Wachovia LC's so long
         as, on the issuance date, cash collateral required to have been
         provided for such Wachovia LC's as of such date pursuant to Section
         8.18 has been provided) of the Borrower's then issued and outstanding
         common stock exercisable any time after issuance, but not later than
         December 31, 2005. Such warrants (the "Warrants") shall be accompanied
         by a warrant holders rights agreement providing the Lender and the
         other Secured Parties with customary registration "call," "put,"
         "clawback", antidilution provisions (including with respect to the
         exercise of options outstanding on the Fourth Amendment Effective Date)
         and similar rights acceptable to the Lender and the other Secured
         Parties. However, the Lender agrees, and the other Secured Parties have
         agreed (by amendments to their Senior Debt Documents), on a pro rata
         basis, to extinguish (return) the Warrants, unexercised, at a rate
         equal to 2% of such outstanding Warrants (to the extent not previously
         exercised) for each 1% of the amount by which the principal balance of
         the Senior Debt outstanding on the Fourth Amendment Effective Date is
         reduced by principal payments made after such date.

         (j) A new Section 8.18 hereby is added to the Credit Agreement as
follows:

                  8.18     Wachovia LC's. With respect to all letters of credit
         issued by Wachovia for the account of the Borrower, whether outstanding
         on the Fourth Amendment Effective Date or thereafter issued (the
         "Wachovia LC's"): (i) on or before 2:00 P.M., E.D.T. on September 1,
         2000, the Borrower will either cause to be surrendered to the Lender
         for cancellation the Wachovia LC issued in connection with worker's
         compensation claims (the "Worker's Comp LC") in the stated amount of
         $795,842 or provide to the Lender cash collateral in an amount equal to
         such stated amount; and (ii) as to all other Wachovia LC's (the "Other
         LC's"), (x) those which currently expire prior to October 31, 2000
         shall be permitted to expire, and (y) as to those which have not
         expired by October 31, 2000, on such date, and as to those issued after
         the Fourth Amendment Effective Date, on the date of issuance, the
         Borrower shall either cause to be surrendered to the Lender for
         cancellation such unexpired Other LC's or provide to the Lender cash
         collateral in an amount equal to the lesser of (x) the maximum amount
         available to be drawn thereunder and (y) an amount which, together with
         the amount of cash collateral provided for the Worker's Comp LC
         pursuant to clause (i) above, does not exceed $2,700,000 (the "Cash
         Collateral Amount"), and the aggregate stated amount of all Wachovia
         LC's for which cash collateral is required pursuant to the foregoing
         shall not exceed the Cash Collateral Amount.

         (k) Section 9.1 hereby is amended by amending and restating the
remedies portion thereof (the final, unlettered paragraph thereof, immediately
following paragraph (m)) as follows:

                                       9
<PAGE>   10

                  then, and in any such event and at any time thereafter, if
                  such Event of Default or any other Event of Default shall have
                  not been waived,

                           (A)      the Lender may, at its option, declare by
                           notice to the Borrower any or all of the Obligations
                           to be immediately due and payable, and the same,
                           including all interest accrued thereon and all other
                           obligations of the Borrower to the Lender shall
                           forthwith become immediately due and payable without
                           presentment, demand, protest, notice or other
                           formality of any kind, all of which are hereby
                           expressly waived, anything contained herein or in any
                           instrument evidencing the Obligations to the contrary
                           notwithstanding; and

                           (B)      the Lender shall have all of the rights and
                           remedies available under the Loan Documents or under
                           any applicable law.

         (l) Exhibit J to the Credit Agreement hereby is deleted and Exhibit J
attached hereto is substituted therefor.

         3. Restatement of Representations and Warranties. The Borrower hereby
restates and renews each and every representation and warranty heretofore made
by it in the Credit Agreement (as amended and modified hereby) and the other
Loan Documents as fully as if made on the date hereof and with specific
reference to this Amendment and all other loan documents executed and/or
delivered in connection herewith, and further represents and warrants that no
material adverse change in the business, properties, prospects, operations or
condition, financial or otherwise, of the Borrower and its Subsidiaries, taken
as a whole, has occurred since March 28, 1999, except any which arise out of
events which have been disclosed to the Lender.

         4. Effect of Amendment. Except as set forth expressly hereinabove, all
terms of the Credit Agreement and the other Loan Documents shall be and remain
in full force and effect, and shall constitute the legal, valid, binding and
enforceable obligations of the Borrower. The agreements contained herein shall
be deemed to have prospective application only, unless otherwise specifically
stated herein.

         5. Ratification. The Borrower hereby restates, ratifies and reaffirms
each and every term, covenant and condition set forth in the Credit Agreement
and the other Loan Documents effective as of the date hereof and agrees that
this Amendment is one of the Loan Documents.

         6. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which may be delivered by facsimile and which (including counterparts delivered
by facsimile) when so executed and delivered shall be deemed to be an original
and all of which counterparts, taken together, shall constitute but one and the
same instrument.

         7. Section References. Section titles and references used in this
Amendment shall be without substantive meaning or content of any kind whatsoever
and are not a part of the agreements among the parties hereto evidenced hereby.

                                       10
<PAGE>   11

         8. No Default or Claims. To induce the Lender to enter into this
Amendment and to continue to make advances pursuant to the Credit Agreement, the
Borrower hereby acknowledges and agrees that, as of the date hereof, and after
giving effect to the terms hereof, (i) no Default or Event of Default exists,
(ii) no right of offset, recoupment, defense, counterclaim, claim or objection
exists in favor of the Borrower arising out of or with respect to any of the
Loans or other obligations of the Borrower owed to the Lenders under the Credit
Agreement, and (iii) the Bank has acted in good faith and has conducted its
relationships with the Borrower in a commercially reasonable manner in
connection with the negotiations, execution and delivery of this Amendment and
in all respects in connection with the Credit Agreement, the Borrower hereby
waiving and releasing any such claims to the contrary that may exist as of the
date of this Amendment.

         9. Governing Law. This Amendment shall be governed by and construed and
interpreted in accordance with, the laws of the State of Georgia.

         10. Conditions Precedent. This Amendment shall become effective only
upon satisfaction of each of the following conditions:

                  (i) No Default or Event of Default shall be in existence
         (giving effect to this Amendment);

                  (ii) The Lender shall have received copies of all documents
         evidencing all governmental approvals, if any, with respect to this
         Amendment and the matters contemplated hereby and thereby;

                  (iii) The Lender shall have received a certificate of the
         Secretary or an Assistant Secretary of the Borrower certifying the
         names and true signatures of the officers authorized to sign this
         Amendment on behalf of the Borrower and any other documents to be
         delivered by the Borrower hereunder;

                  (iv) delivery to Christopher L. Carson, at facsimile
         404-581-8868, of: (1) this Amendment, executed by each of the parties
         hereto; (2) the Consent and Reaffirmation of Guarantors at the end
         hereof, executed by each of the Guarantors; (3) a Global Amendment No.
         2 to Intercreditor Agreements in form and substance satisfactory to the
         Lender, by each of the "Companies", the "Collateral Agent" and each of
         the "Secured Parties" (as those terms are defined in the Intercreditor
         Agreement); (4) a copy of amendments, satisfactory to the Lender in all
         respects, to each of the Bank of America Credit Agreement and the
         Prudential Note Agreement, extending maturities thereunder to April 3,
         2001, and amending other sections thereof to be consistent with the
         amendments to the Credit Agreement contained herein, in each case
         executed by the parties thereto, with all conditions to the
         effectiveness thereof having been satisfied;

                  (v) The Borrower shall have paid to the Lender and the other
         Secured Parties, on a pro-rata basis a fully-earned non-refundable
         amendment fee in an amount equal to 0.25% of the total principal amount
         outstanding of the Senior Debt; and

                  (vi) Payment of Collateral Agent and Lenders' fees and
         reimbursement of expenses due at closing:

                                       11
<PAGE>   12

                  1)       Collateral Agent Fees- $1,425 (6/4/00 - 8/31/00 @
                           $500/month)

                  2)       Field Audit Expenses of the Collateral Agent - (For
                           Core Crown Crafts, CCIP, and Hamco) as set forth in a
                           statement submitted to the Borrower.

                  3)       Legal Fees--Payment of unpaid legal fees and expenses
                           of Jones, Day, Reavis & Pogue, King & Spalding and
                           Smith, Helms, Mullis & Moore, LLP, counsel to the
                           respective Lenders, through the effective date of the
                           Amendment, pursuant to statements submitted to the
                           Borrower (which statements may include estimates of
                           time and expenses to be incurred on and after the
                           dates of posting of actual time and expenses set
                           forth therein, which estimated amounts shall be
                           subject to subsequent adjustment to reflect actual
                           time and expenses subsequently posted).

                  4)       Consulting Fees--Payment of fees and expenses of the
                           Lender's consultant incurred in connection with the
                           review of the Borrower's proposed employee retention
                           plan.

         11. Extension of the Time for Delivery of Certain Reports. The Lender
hereby agrees that the time for delivery of the reports and other items required
to be furnished pursuant to (i) Section 7.1(a) of the Credit Agreement for the
Fiscal Year ended April 2, 2000, and (ii) Section 7.1(b) for the fiscal quarter
ended July 2, 2000, hereby is extended to September 15, 2000.

                       [SIGNATURES CONTAINED ON NEXT PAGE]

                                       12
<PAGE>   13

         IN WITNESS WHEREOF, the Borrower and the Lender have caused this
Amendment to be duly executed, under seal, by their duly authorized officers as
of the day and year first above written.

                                             CROWN CRAFTS, INC.         (SEAL)

                                             By:
                                                --------------------------------
                                                 Title:

                                             WACHOVIA BANK, N.A.        (SEAL)

                                             By:
                                                 ----------------------------
                                                 Title:

                                       13
<PAGE>   14

                     CONSENT AND REAFFIRMATION OF GUARANTORS

         Each of the undersigned (i) acknowledges receipt of the foregoing
Amendment No. 3 to Revolving Credit Agreement (the "Amendment"), (ii) consents
to the execution and delivery of the Amendment by the parties thereto, and (iii)
reaffirms all of its obligations and covenants under that certain Subsidiary
Guaranty Agreement dated as of August 9, 1999, and agrees that none of such
obligations and covenants shall be affected by the execution and delivery of the
Amendment. This Consent and Reaffirmation may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which counterparts, taken together, shall constitute but one and the same
instrument.

                                             GUARANTORS:

                                             CHURCHILL WEAVERS, INC.
                                             CROWN CRAFTS DESIGNER, INC.
                                             CROWN CRAFTS FURNISHINGS, INC.
                                             CROWN CRAFTS FURNISHINGS OF
                                               ILLINOIS, INC.
                                             G.W. STORES, INC.
                                             HAMCO, INC.
                                             CROWN CRAFTS INFANT PRODUCTS,
                                             INC. (as successor to Noel
                                             Joanna, Inc. and the Red
                                             Calliope and Associates, Inc.)

                                             By:
                                                --------------------------------
                                                Title:

                                       14
<PAGE>   15

                                   APPENDIX 1

                                OUTSTANDING ITEMS
                                  Crown Crafts

         Title Insurance Policy for property located in Person County, North
Carolina (see comments to title commitment set forth in letter to George
Jackson, Esq. dated 12/14/99 and letter to Mary Delehant dated 7/20/00)

         Title Insurance Policy for property located in Gordon County, Georgia
(see comments to title commitment set forth in letter to Mary Delehant dated
7/20/00)

         Title Insurance Policy for property located in Whitfield County,
Georgia (see comments to title commitment set forth in letter to Mary Delehant
dated 7/20/00)

         Title Insurance Commitments for property located in Watauga County,
North Carolina (Parcel 1 only) (see comments to title commitment set forth in
letter to Mary Delehant dated 7/20/00)

         Opinion Letter from Crown Crafts, Inc.

         Surveys for all properties

                                       15
<PAGE>   16

                                    EXHIBIT J
                       Form of Borrowing Base Certificate
                             As of _________, 2000

Wachovia Bank, N.A.
191 Peachtree Street, N.E.
Atlanta, Georgia 30303
Telephone: (404) 332-1383
Telefacsimile: (404) 332-6920

This Borrowing Base Certificate is furnished pursuant to the Revolving Credit
Agreement between Crown Crafts, Inc., as Borrower, and Wachovia Bank, N.A., as
Lender, dated as of August 9, 1999, as amended as of the date hereof (the
"Credit Agreement"). Terms which are defined in the Credit Agreement and which
are used herein without definition have the meanings given them in the Credit
Agreement). This is a (check one of the following, and complete the date, as
applicable):

                  _______ Month End Borrowing Base Certificate, as the last day
                              of the fiscal month ended
                              ____________________, 200_.
                  _______ Daily Borrowing Base Certificate, as of ______,
                              200_.

<TABLE>
<CAPTION>
<S>                                                   <C>                        <C>
ACCOUNTS RECEIVABLE

Factored Accounts                                     $
                                                      ---------------
Other Accounts
                                                      ---------------
Reserves
                                                      ---------------
Net Accounts Receivable
                                                      ---------------
Recoverable Income Taxes
                                                      ---------------
Eligible Accounts Receivable
                                                      ---------------
Advance Rate                                                   85%               $
                                                                                 ---------------
Accounts Receivable Component
                                                                                 ---------------
Factor Advances
                                                                                 ---------------
Net Accounts Receivable Component
                                                                                 ---------------

INVENTORY
---------

Raw Materials                                         $
                                                      ---------------
Finished Goods
                                                      ---------------
Reserves
                                                      ---------------
Less Mascioni Inventory
                                                      ---------------
Net Inventory
                                                      ---------------

Advance Rate                                                   50%               $
                                                                                 ---------------(1)
Inventory Component
                                                                                 ---------------
</TABLE>

---------------
(1)      Pursuant to Section 7.1(g) of the Credit Agreement, if this is (i) a
Month End Borrowing Base Certificate, insert the Month End Inventory Component,
which is the actual Inventory Component for such fiscal

                                       16
<PAGE>   17

<TABLE>
<S>                                                   <C>                        <C>
PROPERTY PLANT AND EQUIPMENT

Orderly Liquidation Value of Equipment
                                                      ---------------
Fair Market Value of Real Property
                                                      ---------------
Total (Applicable Property Value)
                                                      ---------------
Advance Rate                                                   80%
                                                                                 ---------------
Property Plant and Equipment Component
                                                                                 ---------------

OVERADVANCE AMOUNT

Initial Overadvance Amount                            $
                                                      ---------------
Less Post March 31, 2000 Inventory Adjustment
                                                      ---------------
Final Overadvance Amount                                                         $
                                                                                 ---------------
BORROWING BASE                                                                   $
                                                                                 ---------------

SENIOR DEBT

Bank of America                                       $
                                                      ---------------
Letter of Credit Outstandings(2)
                                                               ---------------
Prudential
                                                      ---------------
Wachovia
                                                      ---------------
Total Senior Debt                                                                $
                                                                                 ---------------
COMPLIANCE
                                                                                 ===============
</TABLE>

         The undersigned Authorized Officer hereby certifies that the
information set forth above is true, correct and complete as of the date hereof.

         IN WITNESS WHEREOF, I have executed this Certificate this _____ day of
_______, 200__.

                                                      CROWN CRAFTS, INC.

                                                      By:
                                                         -----------------------
                                                           Authorized Officer

---------------
(continued...)

month, and (ii) a Daily Borrowing Base Certificate, insert the Daily Inventory
Component, which is the lesser of the Month End Inventory Component set forth in
the most recent Month End Borrowing Base Certificate, and the Inventory
Component Amount for the current fiscal month set forth in Section 7.1(g), as it
may have been adjusted pursuant thereto.

(2)      Excluding Wachovia LC's which have been cash collateralized pursuant to
Section 8.18 of the Credit Agreement.

                                       17<PAGE>   1

                     AMENDMENT NO. 5 OF 1995 NOTE AGREEMENT

         This Amendment, entered into as of August 31, 2000, by and between
CROWN CRAFTS, INC. (the "Company") and THE PRUDENTIAL INSURANCE COMPANY OF
AMERICA ("Noteholder").

         WHEREAS, the parties hereto have executed and delivered that certain
Note Purchase and Private Shelf Facility dated as of October 12, 1995 (as
previously amended and as it may be further amended, modified or supplemented,
the "Note Agreement");

         WHEREAS, the Company has requested a modification of certain covenants
under the Note Agreement;

         WHEREAS, Noteholder is willing to enter into this Amendment subject to
the satisfaction of conditions and terms set forth herein;

         WHEREAS, capitalized terms used herein and not otherwise defined shall
have the meanings set forth in the Note Agreement; and

         NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

         1.       AMENDMENTS TO PARAGRAPH 4A OF THE NOTE AGREEMENT.

         1A.      Paragraph 4A hereby is amended and restated in its entirety as
follows:

                  4A.      REQUIRED PREPAYMENTS OF SERIES A NOTES.

                  (i)      The Company shall make, or shall cause each
         applicable Subsidiary to make, a prepayment from the Net Proceeds of
         each Restricted Asset Disposition and each Capital Market Transaction,
         except that such Net Proceeds shall be (a) payable to the Collateral
         Agent as and when the aggregate amount thereof since the last such
         payment of Net Proceeds pursuant hereto is equal to or exceeds $50,000,
         and (b) applied to reduce the amount of Mandatory Senior Debt Payments
         required to be made pursuant to clause 4A(iii), with such applications
         being applied in the order of maturity of the Payment Dates set forth
         in clause 4A(iii). Such amounts paid to the Collateral Agent shall be
         held by the Collateral Agent, for the ratable benefit of the Secured
         Parties, and distributed to the Secured Parties as and when the
         aggregate amount held by it is at least equal to $250,000, or at such
         earlier time as the Secured Parties may agree upon, all pursuant to the
         provisions of Section 32 of the Intercreditor Agreement.
<PAGE>   2

                                                                               2

                  (ii)     The Company shall make payments of principal
         outstanding on the Senior Debt to the Secured Parties, pro rata
         (calculated as provided in Section 32(c) of the Intercreditor
         Agreement), in the following amounts on or before the dates set forth
         below (the "MANDATORY SENIOR DEBT PAYMENTS"):

<TABLE>
<CAPTION>
                           Payment Date                      Payment Amount
                           ------------                      --------------
                           <S>                               <C>
                           December 8, 2000                   $ 7,000,000
                           December 31, 2000                  $ 4,000,000
                           February 4, 2001                   $ 3,000,000
                           March 4, 2001                      $ 2,000,000
                           April 1, 2001                      $ 3,000,000
                                                              -----------
                                         Total                $19,000,000
</TABLE>

                  (iii)    The Notes of each Series shall be subject to
         prepayment in whole or in part pursuant to this paragraph 4A at 100% of
         the principal amount so prepaid plus interest thereon to the prepayment
         date and Yield-Maintenance Amount, if any, subject to clause (v) below,
         with respect to each such Note.

                  (iv)     The Notes of each Series shall be due and payable on
         April 3, 2001 at 100% of the principal amount plus interest thereon to
         the payment date and Yield-Maintenance Amount.

                  (v)      Yield-Maintenance Amount shall not be payable on any
         prepayments of principal that are in the aggregate less than or equal
         to $7,142,856 and made after August 30, 2000. For any prepayment of
         principal in excess of an aggregate of $7,142,856, Yield-Maintenance
         Amount shall be due and payable on the payment date with respect to
         such prepayment. The calculation of the Yield-Maintenance Amount shall
         be made using the mandatory prepayment schedule applicable to the Notes
         as originally issued (annual prepayments equal to $3,571,428 with a
         maturity date of October 12, 2005) and the interest rate as set forth
         in the originally executed Notes (Series A Note equal to 7.27% per
         annum; Series B Note equal to 6.56% per annum).

         2.       AMENDMENTS TO PARAGRAPH 5 OF THE NOTE AGREEMENT.

         2A.      Paragraph 5A(l)(vii) hereby is amended and restated in its
entirety as follows:

                  (vii)    as soon as available, such other information relating
         to the business, operations, affairs and financial condition of the
         Company or any of its Subsidiaries from time to time delivered by the
         Company pursuant to the Bank of America Credit Agreement or the
         Wachovia Bank Credit Agreement, including, without limitation,

                           (A)      as soon as practicable and in any event
                  within 40 days (except for the borrowing base certificate
                  pursuant to clause (y) below, which shall be delivered within
                  35 days) after the end of each month beginning with the fiscal
                  month ended July 31, 2000, (x) a balance sheet of the Company
                  and its Subsidiaries as at the end of such month and the
                  related statements of income,

<PAGE>   3

                                                                               3

                  stockholders' equity and cash flows for such month, and
                  accompanied by a certificate of an Authorized Officer to the
                  effect that such financial statements present fairly in all
                  material respects the financial position of the Company and
                  its Subsidiaries as of the end of such month and the results
                  of their operations and the changes in their financial
                  position for such month, in conformity with GAAP applied on a
                  Consistent Basis, subject to normal year-end audit adjustments
                  and the absence of footnotes, (y) a borrowing base certificate
                  (calculated showing the Month End Inventory Amount, as defined
                  in and pursuant to the provisions of clause (B) below) and (z)
                  a certificate of an Authorized Officer demonstrating
                  compliance with Paragraph 6A hereof, which certificate shall
                  be in the form attached to the Wachovia Bank Credit Agreement
                  as Exhibit J, and

                           (B)      on each Business Day, an uncertified, good
                  faith estimated update (a "DAILY BORROWING BASE CERTIFICATE")
                  of the most recently furnished monthly borrowing base
                  certificate (a "MONTH END BORROWING BASE CERTIFICATE") as to
                  the information under the heading "Accounts Receivable"
                  pertaining to "Factored Accounts" and "Factor Advances"; and
                  the information under the heading "Senior Debt". The Month End
                  Borrowing Base Certificate shall show, for the final line item
                  under the heading INVENTORY contained therein (the "INVENTORY
                  COMPONENT"), the actual Inventory Component calculated for
                  such fiscal month (the "MONTH END INVENTORY COMPONENT
                  AMOUNT"). The Inventory Component shown on each Daily
                  Borrowing Base Certificate (the "DAILY INVENTORY COMPONENT
                  AMOUNT") shall show the lesser of (i) the Month End Inventory
                  Component Amount for the most recently furnished Month End
                  Borrowing Base Certificate and (ii) the Inventory Component
                  amount for the relevant fiscal month set forth below,
                  provided, that the amounts set forth below are subject to
                  adjustment satisfactory to the Noteholder and the Company
                  following any material asset divestiture, to the extent
                  necessary to take into account the effect thereon of any such
                  divestiture:

<TABLE>
<CAPTION>

                           Fiscal Month Ended:                         Inventory Component Amount:
                           -------------------                         ---------------------------
                           <S>                                         <C>
                           September 3, 2000                                     $32,000,000
                           October 1, 2000                                       $29,000,000
                           November 5, 2000                                      $27,000,000
                           December 3, 2000                                      $26,000,000
                           December 31, 2000 and thereafter                      $25,000,000
</TABLE>

                           The Month End Inventory Component Amount shown in a
                  Month End Borrowing Base Certificate shall be used solely for
                  purposes of calculating the Daily Inventory Component Amount
                  on Daily Borrowing Base Certificates delivered thereafter
                  pursuant to the foregoing until the delivery of the next Month
                  End Borrowing Base Certificate, and the Inventory Component
                  for purposes of calculating the Borrowing Base (as defined in
                  the Wachovia Credit Agreement) shall be the Daily Inventory
                  Component Amount set forth in each Daily Borrowing Base
                  Certificate; and
<PAGE>   4

                                                                               4

         2B.      Paragraph 5A(1) hereby is amended by adding new paragraphs
(viii) and (ix) thereto as follows:

                  (viii)   UPDATES OF INITIATIVES SUMMARY. With respect to
         Initiatives Summary (as defined in the letter agreement among the
         Company and the Secured Parties dated as of June 27, 2000), the Company
         shall furnish to the Noteholder (i) on Thursday of each week, a weekly
         update of the Initiative Summary as to strategic initiatives and (ii)
         on the 7th Business Day of each month, a monthly update as to all other
         aspects of the Initiatives Summary; and

                  (ix)     DELIVERY OF OUTSTANDING ITEMS. The items described on
         Appendix 1 hereto, which were to have been furnished to Wachovia Bank
         pursuant to Section 10(a) of Amendment No. 1 to the Wachovia Bank
         Credit Agreement, but have not yet been delivered, shall be delivered
         to the Noteholder (i) on or before November 30, 2000, with respect to
         the title policies described on Appendix 1 and (ii) on or before
         October 31, 2000, with respect to all other items.

         2C.      Paragraph 5 is amended by the addition of a new paragraph, as
follows:

                  5G.      WARRANTS. By October 2, 2000, the Company shall issue
         to the Noteholder (or its affiliate designee), together with each of
         the other Secured Parties (or their affiliate designees) without any
         further consideration payable, warrants (the "WARRANTS"), exercisable
         at nominal cost for the Company's common stock such that upon issuance
         the Secured Parties, collectively, shall own 10% of the Company's then
         issued and outstanding common stock exercisable any time after
         issuance, but not later than December 31, 2005; provided, however, that
         the Warrants shall be reduced, to the extent not previously exercised,
         at a rate equal to 2% of such outstanding Warrants for each 1% of the
         amount by which the principal balance of the Senior Debt outstanding on
         August 31, 2000 is permanently reduced by principal payments made after
         such date. The Warrants shall be accompanied by a warrant holders
         rights agreement providing the Noteholder and the other Secured Parties
         with customary registration, "call," "put," "clawback", antidilution
         provisions (including with respect to the exercise of options
         outstanding on August 31, 2000) and similar rights acceptable to the
         Noteholder, in its sole discretion. The Warrants shall be divided among
         the Secured Parties pro rata, without taking into account any
         outstanding Wachovia LC's (as defined in the Wachovia Credit Agreement)
         so long as, on the issuance date, cash collateral required to have been
         provided for such Wachovia LC's as of such date pursuant to the
         Wachovia Credit Agreement has been provided by the Company.

         3.       AMENDMENTS TO PARAGRAPH 6 OF THE NOTE AGREEMENT.

         3A.      Paragraph 6A hereby is amended and restated in its entirety as
follows:

                  6A.      FINANCIAL COVENANTS. The Company covenants that it
         will not at any time:
<PAGE>   5

                                                                               5

                  (i)      CAPITAL EXPENDITURES. Permit Capital Expenditures
         during the period from April 2, 2000 through April 3, 2001 to exceed
         $4,400,000.

                  (ii)     CONSOLIDATED EBITDA. Permit cumulative Consolidated
         EBITDA as of the end of any fiscal month set forth below to be less
         than the amount set forth below opposite such date, provided, that the
         amounts set forth below are subject to adjustment satisfactory to the
         Noteholder and the Company following any material asset divestiture, to
         the extent necessary to take into account the effect thereon of any
         such divestiture:

<TABLE>
<CAPTION>

                                                                 Minimum Consolidated
                  Fiscal Month-End                                      EBITDA
                  ----------------                               --------------------
                  <S>                                            <C>
                  July 2, 2000 (3 months)                             (4,750,000)
                  August 6, 2000                                      (5,700,000)
                  September 3, 2000                                   (4,100,000)
                  October 1, 2000                                       (750,000)
                  November 5, 2000                                     2,750,000(1)
                  December 3, 2000                                     4,500,000
                  December 31, 2000                                    6,500,000
                  February 2, 2001                                     7,500,000
                  March 3, 2001                                       10,000,000
                  April 1, 2001                                       14,500,000
</TABLE>

         3B.      Paragraph 6N hereby is amended and restated in its entirety as
follows:

                  6N.      FACTOR ADVANCES. Permit to exist any Factor Advances,
         other than Factor Advances from a Permitted Factor in an aggregate
         amount not exceeding the amount set forth below during the periods set
         forth below, provided, that the amounts set forth below are subject to
         adjustment satisfactory to the Noteholder and the Company following any
         material asset divestiture, to the extent necessary to take into
         account the effect thereon of any such divestiture:

<TABLE>
<CAPTION>

                  Month-End Date                                                 Factor Adv. Limit
                  --------------                                                 -----------------
                  <S>                                                            <C>
                  August 31, 2000 through September 4, 2000                             27,500,000
                  September 5, 2000 through September 11, 2000                          28,000,000
                  September 12, 2000 through September 18, 2000                         33,000,000
                  September 19, 2000 through September 25, 2000                         34,000,000
                  September 26, 2000 through October 2, 2000                            36,000,000
                  October 3, 2000 through October 9, 2000                               36,000,000
                  October 10, 2000 through October 16, 2000                             34,000,000
                  October 17, 2000 through October 23, 2000                             32,000,000
                  October 24, 2000 through October 30, 2000                             31,000,000
                  October 31, 2000 through November 6, 2000                             27,000,000
</TABLE>

------------------

         (1)      This amount assumes receipt of the New York showroom rental
income in the amount of $1,021,000 during the fiscal month ending November 5. If
such amount is not received in such fiscal month, the Minimum Consolidated
EBITDA for the fiscal month ending November 5 will be decreased by such amount.
<PAGE>   6

                                                                               6

<TABLE>
                  <S>                                                                   <C>
                  November 7, 2000 through November 13, 2000                            25,000,000
                  November 14, 2000 and thereafter                                      24,000,000
</TABLE>

         3C.      Paragraph 6 hereby is amended by adding new paragraph 6O as
follows:

                  6O.      PRORATA PAYMENTS TO SECURED PARTIES. Except as to any
         Discretionary Loans (as defined in the Intercreditor Agreement),
         notwithstanding any provision to the contrary contained in any of the
         Senior Debt Documents or the Intercreditor Agreement, the Company may
         not make any principal payments to any of the Secured Parties other
         than prorata principal payments, and each Secured Party's prorata share
         shall be calculated as provided in Section 32 of the Intercreditor
         Agreement.

         4.       AMENDMENT TO PARAGRAPH 7 OF THE NOTE AGREEMENT. Paragraph 7 is
amended by deleting clause (v) thereof and substituting the following therefor:

                  (v)      the Company fails to perform of observe any agreement
         contained in paragraphs 5E,  5F, 5G or 6; or

         5.       AMENDMENTS TO PARAGRAPH 10 OF THE NOTE AGREEMENT.

         5A.      Paragraph 10A is hereby amended by adding the following
         sentence at the of each of the following defined terms, "Discounted
         Value", "Reinvestment Yield", "Remaining Average Life", "Remaining
         Scheduled Payments" and "Yield-Maintenance Amount":

                  For purposes of this calculation for any Note, it is agreed
                  that the mandatory prepayment schedule applicable to the Notes
                  as originally issued (annual prepayments equal to $3,571,428
                  with a maturity date of October 12, 2005) and the interest
                  rate as set forth in the originally executed Notes (Series A
                  Note equal to 7.27% per annum; Series B Note equal to 6.56%
                  per annum) shall be used.

         5B.      Paragraph 10B is hereby amended as follows:

                  (i)      By deleting the definitions of "Consolidated EBITDA"
         and "Restricted Asset Dispositions" and replacing the following
         definitions of "Consolidated EBITDA" and "Restricted Asset
         Dispositions" in lieu thereof:

                  "CONSOLIDATED EBITDA" means, with respect to the Company and
         its Subsidiaries for any measurement period ending on the date of
         computation thereof, the sum of, without duplication, (i) Consolidated
         Net Income, (ii) Consolidated Interest Expense, (iii) taxes on income,
         (iv) amortization and (v) depreciation, all determined on a
         consolidated basis in accordance with GAAP applied on a Consistent
         Basis, but excluding one-time charges associated with divestitures,
         plant closures, severance, asset write-offs, employee retention and
         fees and expenses incurred by the Company in connection with the August
         2000 Transaction Document Amendments (as defined in Section 32 of the
         Intercreditor Agreement).
<PAGE>   7

                                                                               7

                  "RESTRICTED ASSET DISPOSITIONS" means (i) any Subsidiary
         Disposition and (ii) any Asset Dispositions (other than an Asset
         Disposition referred to in clauses (a), (f) or (g) of the definition of
         "Permitted Asset Dispositions", provided that the proceeds therefrom
         shall be applied as provided in Paragraph 4A(ii).

                  (ii)     By inserting the following definition of the term
         "Net Proceeds" in the appropriate alphabetical order:

                  "NET PROCEEDS" means (a) in connection with any Restricted
         Asset Disposition, the proceeds thereof in the form of cash and cash
         equivalents (including any such proceeds received by way of deferred
         payment of principal pursuant to a note or installment receivable or
         purchase price adjustment receivable or otherwise, but only as and when
         received) of such Restricted Asset Disposition, after deducting
         therefrom, as applicable, (i) attorneys' fees, accountants' fees,
         investment banking fees, survey costs, title insurance premiums, and
         related search and recording charges, transfer taxes, deed or mortgage
         recording taxes, amounts required to be applied to the repayment of
         Indebtedness secured by a Lien on any asset which is the subject of
         such Restricted Asset Disposition and other customary fees and expenses
         actually incurred in connection therewith, (ii) taxes paid or
         reasonably estimated by the Company to be payable as a result thereof
         (including withholding taxes incurred in connection with cross-border
         transactions, if applicable), (iii) appropriate amounts to be provided
         by the Company or any Subsidiary, as the case may be, as a reserve
         required in accordance with GAAP against any liabilities associated
         with such Restricted Asset Disposition and retained by the Company or
         any Subsidiary, as the case may be, after such Restricted Asset
         Disposition, including, without limitation, pension and other
         post-employment benefit liabilities and liabilities under any
         indemnification obligations associated with such Restricted Asset
         Disposition, and (iv) amounts agreed upon by the Secured Parties in
         writing for employee retention and severance, (b) in connection with
         any Capital Market Transactions (but not including in "Net Proceeds"
         any replacements, refundings or refinancings of existing Indebtedness),
         the cash proceeds received from such issuance or incurrence, net of
         attorneys' fees, investment banking fees, accountants' fees,
         underwriting discounts and commissions and other customary fees and
         expenses actually incurred in connection therewith and (c) in
         connection with any Asset Disposition, means cash payments received by
         the Company therefrom (including any cash payments received pursuant to
         any note or other debt security received in connection with any Asset
         Disposition) as and when received, net of (i) all legal fees and
         expenses and other fees and expenses paid to third parties and incurred
         in connection therewith, (ii) all taxes required to be paid or accrued
         as a consequence of such disposition and (iii) all amounts applied to
         repayment of Indebtedness (other than the Senior Debt) secured by a
         Lien on the asset or property disposed.
<PAGE>   8

                                                                               8

         6.       AMENDMENT TO EXHIBIT A. Exhibit A to the Note Agreement shall
be deleted in its entirety and Exhibit A attached hereto shall be substituted
therefor.

         7.       CONDITIONS OF EFFECTIVENESS. This Amendment shall become
effective when, and only upon the satisfaction of each of the following
conditions, such satisfaction to occur on or prior to August 31, 2000:

         (a)      No Default or Event of Default shall be in existence after
giving effect to this Amendment;

         (b)      the Noteholder shall have received executed originals of this
Amendment and all of the following documents, each (unless otherwise indicated)
being dated the date hereof, in form and substance satisfactory to the
Noteholder:

                  (i)      The Notes;

                  (ii)     Copies of all documents evidencing all governmental
         approvals, if any, with respect to this Amendment and the matters
         contemplated hereby and thereby;

                  (iii)    A certificate of the Secretary or an Assistant
         Secretary of the Company certifying the names and true signatures of
         the officers authorized to sign this Amendment on behalf of the Company
         and any other documents to be delivered by the Company hereunder;

                  (iv)     The Consent and Reaffirmation of the Facility
         Guarantors attached hereto by each of the Guarantors;

                  (v)      A duly executed Amendment No. 4, satisfactory to the
         Required Holders in all respects, to the Wachovia Bank Credit
         Agreement;

                  (vi)     A duly executed Amendment No. 4, satisfactory to the
         Required Holders in all respects, to the Bank of America Credit
         Agreement;

                  (vii)    A duly executed Global Amendment No. 2 to
         Intercreditor Agreements in form and substance satisfactory to
         Noteholder;

                  (viii)   A legal opinion of counsel to Company, as to such
         matters as the Noteholder may request; and

                  (ix)     Such other documents, instruments, approvals or
         opinions as the Noteholder may reasonably request.

         (c)      The Company shall have paid to the Noteholder and the other
Secured Parties, on a pro rata basis a fully-earned, non-refundable amendment
fee in an amount equal to 0.25% of the total principal amount outstanding of the
Senior Debt;
<PAGE>   9

                                                                               9

         (d)      Payment to the Person indicated below of the following amounts
in immediately available funds:

                  (i)      to the Collateral Agent, Collateral Agent Fees in an
         amount equal to $1,425;

                  (ii)     to the Collateral Agent for Field Audit Expenses of
         the Collateral Agent with respect to Core Crown Crafts, CCIP, and
         Hamco, in the amount as set forth in a statement submitted to the
         Company;

                  (iii)    to the appropriate Secured Party, legal fees and
         expenses of Jones, Day, Reavis & Pogue; King & Spalding; and Smith,
         Helms, Mullis & Moore, LLP, counsel to the respective Secured Parties,
         through the effective date of the Amendment, pursuant to statements
         submitted to the Company (which statements may include estimates of
         time and expenses to be incurred on and after the dates of posting of
         actual time and expenses set forth therein, which estimated amounts
         shall be subject to subsequent adjustment to reflect actual time and
         expenses subsequently posted; and

                  (iv)     to the appropriate Secured Party, fees and expenses
         of consultants to the respective Secured Parties incurred in connection
         with the review of the Company's proposed employee retention plan.

         8.       REPRESENTATIONS AND WARRANTIES.

         (a)      The Company hereby repeats and confirms each of the
representations and warranties made by it in the Note Agreement, as amended
hereby, as though made on and as of the date hereof, with each reference therein
to "this Agreement", "hereof", "hereunder", "thereof", "thereunder" and words of
like import being deemed to be a reference to the Note Agreement as amended
hereby.

         (b)      The Company further represents and warrants as follows:

                  (i)      The execution, delivery and performance by the
         Company of this Amendment and the Notes are within its corporate
         powers, have been duly authorized by all necessary corporate action and
         do not contravene (A) its charter or by-laws, (B) law or (C) any legal
         or contractual restriction binding on or affecting the Company; and
         such execution, delivery and performance do not or will not result in
         or require the creation of any Lien upon or with respect to any of its
         properties.

                  (ii)     No governmental approval is required for the due
         execution, delivery and performance by the Company of this Amendment
         and the Notes, except for such governmental approvals as have been duly
         obtained or made and which are in full force and effect on the date
         hereof and not subject to appeal.
<PAGE>   10

                                                                              10

                  (iii)    This Amendment and the Notes constitute the legal,
         valid and binding obligations of the Company enforceable against the
         Company in accordance with its terms.

                  (iv)     There are no pending or threatened actions, suits or
         proceedings affecting the Company or any of its Subsidiaries or the
         properties of the Company or any of its Subsidiaries before any court,
         governmental agency or arbitrator, that may, if adversely determined,
         materially adversely affect the financial condition, properties,
         business, operations or prospects of the Company and it Subsidiaries,
         considered as a whole, or affect the legality, validity or
         enforceability of the Note Agreement as amended by this Amendment.

                  (v)      No material adverse change in the business,
         properties, prospects, operations or condition, financial or otherwise,
         of the Company and its Subsidiaries, taken as a whole, has occurred
         since March 28, 1999, except any which arise out of events which have
         been disclosed to the Noteholder.

         9.       MISCELLANEOUS.

         9A.      REFERENCE TO AND EFFECT ON THE NOTE AGREEMENT.

         (a)      Upon the effectiveness of this Amendment, on and after the
date hereof each reference in the Note Agreement to "this Agreement",
"hereunder", "hereof" or words of like import referring to the Note Agreement,
and each reference in any other document to "the Note Agreement", "thereunder",
"thereof" or words of like import referring to the Note Agreement, shall mean
and be a reference to the Note Agreement, as amended hereby and each reference
to the Notes shall mean and be a reference to the Notes issued in connection
with this Amendment.

         (b)      Except as specifically amended above, the Note Agreement and
the Notes, and all other related documents, are and shall continue to be in full
force and effect and are hereby in all respects ratified and confirmed.

         (c)      The execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of any holder of a Note under the Note Agreement or the
Notes, nor constitute a waiver of any provision of any of the foregoing.

         9B.      COSTS AND EXPENSES. The Company agrees to pay on demand all
costs and expenses incurred by any holder of a Note in connection with the
preparation, execution and delivery of this Amendment, including, without
limitation, the reasonable fees and out-of-pocket expenses of counsel. The
Company further agrees to pay on demand all costs and expenses, if any
(including, without limitation, reasonable counsel fees and expenses of
counsel), incurred by any holder of a Note in connection with the enforcement
(whether through negotiations, legal proceedings or otherwise) of this
Amendment, including, without limitation, counsel fees and expenses in
connection with the enforcement of rights under this paragraph 9B.
<PAGE>   11

                                                                              11

         9C.      EXECUTION IN COUNTERPARTS. This Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute but one and the
same instrument.

         9D.      GOVERNING LAW. This Amendment shall be governed by, and
construed in accordance  with, the laws of the State of New York.

         9E.      NO DEFAULT OR CLAIMS. To induce the Noteholder to enter into
this Amendment, the Company hereby acknowledges and agrees that, as of the date
hereof, and after giving effect to the terms hereof, (i) no Default or Event of
Default exists, (ii) no right of offset, recoupment, defense, counterclaim,
claim or objection exists in favor of the Company arising out of or with respect
to any of the Notes or other obligations of the Company owed to any holder of a
Note, and (iii) the Noteholder has acted in good faith and has conducted its
relationships with the Company in a commercially reasonable manner in connection
with the negotiations, execution and delivery of this Amendment and in all
respects in connection with the Note Agreement, the Company hereby waiving and
releasing any such claims to the contrary that may exist as of the date of this
Amendment.

         9F.      Extension of the Time for Delivery of Certain Reports. The
Noteholder hereby agrees the time for delivery of the reports and other items
required to be furnished pursuant to (i) Paragraph 5A(1)(i) of the Note
Agreement for the Fiscal Year ended April 2, 2000, and (ii) Paragraph 5A(1)(ii)
for the fiscal quarter ended July 2, 2000, hereby is extended to September 15,
2000.

<PAGE>   12

                                                                              12

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.

                                               CROWN CRAFTS, INC.

                                               By
                                                 -------------------------------
                                                 Title:

                                               THE PRUDENTIAL INSURANCE
                                                   COMPANY OF AMERICA

                                               By
                                                 -------------------------------
                                                 Title:

<PAGE>   13

                CONSENT AND REAFFIRMATION OF FACILITY GUARANTORS

         Each of the undersigned (i) acknowledges receipt of the foregoing
Amendment of 1995 Note Agreement (the "AMENDMENT"), (ii) consents to the
execution and delivery of the Amendment by the parties thereto, and (iii)
reaffirms all of its obligations and covenants under that certain Subsidiary
Guaranty Agreement dated as of August 9, 1999, and agrees that none of such
obligations and covenants shall be affected by the execution and delivery of the
Amendment. This Consent and Reaffirmation may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which counterparts, taken together, shall constitute but one and the same
instrument.

                                     FACILITY GUARANTORS:

                                     CHURCHILL WEAVERS, INC.
                                     CROWN CRAFTS DESIGNER, INC.
                                     CROWN CRAFTS FURNISHINGS, INC.
                                     CROWN CRAFTS FURNISHINGS OF
                                       ILLINOIS, INC.
                                     G.W. STORES, INC.
                                     HAMCO, INC.
                                     CROWN CRAFTS INFANT PRODUCTS, INC.
                                         (as successor to Noel Joanna, Inc. and
                                         The Red Calliope and Associates, Inc.)

                                     By:
                                        --------------------------------------
                                     Name:
                                          ------------------------------------
                                     Title:
                                           -----------------------------------

<PAGE>   14

                                   APPENDIX 1

                                OUTSTANDING ITEMS
                                  Crown Crafts

         Title Insurance Policy for property located in Person County, North
Carolina (see comments to title commitment set forth in letter to George
Jackson, Esq. dated 12/14/99 and letter to Mary Delehant dated 7/20/00)

         Title Insurance Policy for property located in Gordon County, Georgia
(see comments to title commitment set forth in letter to Mary Delehant dated
7/20/00)

         Title Insurance Policy for property located in Whitfield County,
Georgia (see comments to title commitment set forth in letter to Mary Delehant
dated 7/20/00)

         Title Insurance Commitments for property located in Watauga County,
North Carolina (Parcel 1 only) (see comments to title commitment set forth in
letter to Mary Delehant dated 7/20/00)

         Opinion Letter from Crown Crafts, Inc.

         Surveys for all properties

<PAGE>   15

                                                                       EXHIBIT A

         THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND
         MAY NOT BE OFFERED OR SOLD IN VIOLATION OF SUCH ACT.

         THIS NOTE IS GIVEN SUBSTITUTION AND WITHOUT NOVATION OF A PROMISSORY
         NOTE DATED [OCTOBER 12, 1995] [JANUARY 25, 1996] ISSUED BY CROWN
         CRAFTS, INC.

                               CROWN CRAFTS, INC.

                       SENIOR SERIES [A] [B] NOTE DUE 2001

No. R-                                                           August 31, 2000
$_________

         FOR VALUE RECEIVED, the undersigned, CROWN CRAFTS, INC. (herein called
the "COMPANY"), a corporation organized and existing under the laws of the State
of Georgia, hereby promises to pay to ___________________ or registered assigns,
the principal sum of _________________ DOLLARS on April 3, 2001 with (a)
interest (computed on the basis of a 360-day year-30-day month) (i) on the
unpaid balance thereof at the Applicable Rate (as defined below) from the date
hereof, payable monthly on the 12th day of each calendar month in each year,
commencing with September 12, 2000, until the principal hereof shall have become
due and payable, and (ii) on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of Yield Maintenance Amount and
any overdue payment of interest, payable monthly as aforesaid (or, at the option
of the registered holder hereof, on demand), at a rate per annum from time to
time equal to the greater of (x) the Applicable Rate or (y) 2% over the rate of
interest publicly announced by Bank of New York from time to time in New York
City as its Prime Rate and (b) the accrued interest from July 12, 2000 through
the date hereof payable on September 12, 2000. "APPLICABLE RATE" shall mean and
equal 11.77% per annum plus if prior to or on January 1, 2001, the aggregate
principal amount of Senior Debt has not been reduced below $85,000,000, an
additional 2% per annum ("ADDITIONAL AMOUNT") commencing January 2, 2001,
provided, however, that if the aggregate principal amount of Senior Debt has
been reduced permanently to less than $65,000,000 prior to or on February 15,
2001, such Additional Amount shall cease to accrue commencing February 15, 2001;
and provided further that if prior to or on March 31, 2001, the aggregate
principal amount of Senior Debt has been reduced permanently to less than
$60,000,000, the Applicable Rate shall be reduced to and equal 11.77% per annum.

         Payments of principal, Yield Maintenance Amount, if any, and interest
are to be made at the main office of Bank of New York in New York City or at
such other place as the holder

                                       A-1
<PAGE>   16

hereof shall designate to the Company in writing, in lawful money of the United
States of America.

         This Note is one of a series of Senior Notes (as amended or
substituted, the "NOTES") issued pursuant to a Note Purchase and Private Shelf
Agreement, dated as of October 12, 1995 (as it has been and may be amended, the
"AGREEMENT"), between the Company and The Prudential Insurance Company of
America and each Prudential Affiliate which becomes party thereto, on the other
hand, and is entitled to the benefits thereof. As provided in the Agreement,
this Note is subject to prepayment, in whole or from time to time in part, with
the Yield Maintenance Amount as specified in the Agreement.

         This Note is a registered Note and, as provided in the Agreement, upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new Note
for the then outstanding principal amount will be issued to, and registered in
the name of, the transferee. Prior to due presentment for registration of
transfer, the Company may treat the person in whose name this Note is registered
as the owner hereof for the purpose of receiving payment and for all other
purposes, and the Company shall not be affected by any notice to the contrary.

         In case an Event of Default shall occur and be continuing, the
principal of this Note may be declared or otherwise become due and payable in
the manner and with the effect provided in the Agreement.

         Capitalized terms used and not otherwise defined herein shall have the
meanings (if any) provided in the Agreement.

         THIS NOTE IS INTENDED TO BE PERFORMED IN THE STATE OF NEW YORK AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAW OF SUCH
STATE.

                                               CROWN CRAFTS, INC.

                                               By:
                                                  -------------------------
                                               Title:
                                                     ----------------------

                                       A-2

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