EXHIBIT 10.2
THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Third Amendment") is
dated as of the 10th day of February, 2003 among CROWN CRAFTS, INC., ▇▇▇▇▇▇▇▇▇
WEAVERS, INC., HAMCO, INC. and CROWN CRAFTS INFANT PRODUCTS, INC. (collectively,
the "Borrowers"), WACHOVIA BANK, NATIONAL ASSOCIATION (successor by merger to
Wachovia Bank, N.A.), as Agent (the "Agent") and WACHOVIA BANK, NATIONAL
ASSOCIATION (successor by merger to Wachovia Bank, N.A.), BANC OF AMERICA
STRATEGIC SOLUTIONS, INC. (assignee of Bank of America, N.A.) and THE PRUDENTIAL
INSURANCE COMPANY OF AMERICA, as Lenders (collectively, the "Lenders");
W I T N E S S E T H :
WHEREAS, the Borrowers, the Agent and the Lenders executed and
delivered that certain Credit Agreement, dated as of July 23, 2001, as amended
by First Amendment to Credit Agreement dated as of September 28, 2001 and Second
Amendment to Credit Agreement dated as of November 25, 2002 (as so amended, the
"Credit Agreement");
WHEREAS, the Borrowers, the Agent and the Lenders have agreed to
certain amendments to 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 Borrowers, the Agent and the
Lenders 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 SECTION 1.01. SECTION 1.01 of the Credit Agreement
hereby is amended by deleting the definitions of "Consolidated Available Free
Cash Flow" and "Consolidated EBITDA", and substituting therefor the following
new definitions of such terms:
"Consolidated Available Free Cash Flow" means, for each Annual
Period, an amount equal to 85% of Consolidated Free Cash Flow for such
Annual Period.
"Consolidated EBITDA" means the sum of the following,
calculated on a consolidated basis in accordance with GAAP for the
Parent and its Consolidated Subsidiaries, for the relevant fiscal
period: (i) Consolidated Net Income; plus (ii) depreciation and
amortization expenses; plus (iii) Consolidated Interest Expense; plus
(iv) income tax expense included in Consolidated Net Income; plus (v)
for the following Fiscal Quarters only, a before-tax reserve related to
the closing of the operations of Burgundy
Interamericana SA de CV, not exceeding the following amounts for the
following Fiscal Quarters (1) for the Fiscal Quarter ending December
29, 2002, $1,775,000, (2) for the Fiscal Quarter ending March 30, 2003,
$225,000 and (3) for the Fiscal Quarter ending June 29, 2003, $275,000.
3. Amendment to SECTION 5.20(a). SECTION 5.20(a) hereby is deleted in
its entirety, and the following is substituted therefor:
(a) Minimum EBITDA. Consolidated EBITDA shall not be less
than, for each Fiscal Quarter set forth below and the 3 immediately
preceding Fiscal Quarters, the amount set forth below corresponding to
such Fiscal Quarter:
---------------------------------------- -------------------------------------
FISCAL QUARTER ENDING MINIMUM EBITDA
---------------------------------------- -------------------------------------
December 29, 2002 through March 30, 2004 $6,885,000
---------------------------------------- -------------------------------------
June 29, 2004 and each Fiscal Quarter An amount to be agreed upon in
thereafter writing by the parties, not to
exceed $8,725,000 (which amount
shall be applicable if no other
amount has been agreed upon in
writing)
---------------------------------------- -------------------------------------
4. Amendment to SECTION 5.20(b). SECTION 5.20(b) hereby is deleted in
its entirety, and the following is substituted therefor:
(b) Debt/EBITDA Ratio. The Debt/EBITDA Ratio will not exceed,
at the end of each Fiscal Quarter set forth below, calculated as to
Debt as of such Fiscal Quarter and calculated as to Consolidated EBITDA
for such Fiscal Quarter and the 3 immediately preceding Fiscal
Quarters, the ratio set forth below corresponding to such Fiscal
Quarter:
-------------------------------------------- ------------------------------------------
FISCAL QUARTER ENDING MAXIMUM DEBT/EBITDA RATIO
------------------------------------------ ------------------------------------------
December 29, 2002 through March 30, 2004 4.75 to 1.0
------------------------------------------ ------------------------------------------
June 29, 2004 and each Fiscal Quarter A ratio to be agreed upon in writing by
thereafter the parties, not to exceed 3.00 to 1.0
(which ratio shall be applicable if no
other ratio has been agreed upon in
writing)
------------------------------------------ ------------------------------------------
5. Amendment to Exhibit G (Compliance Certificate). Exhibit G to the
Credit Agreement hereby is deleted in its entirety, and Exhibit G attached
hereto is substituted therefor.
6. Amendment to Exhibit R (Consolidated Excess Cash Flow Certificate).
Exhibit R to the Credit Agreement hereby is deleted in its entirety, and Exhibit
R attached hereto is substituted therefor.
7. Consent to Discontinuance of Operations and Disposition of Assets.
The Borrowers have informed the Agent and the Lenders that they desire to
discontinue the operations of Burgundy Interamericana SA de CV and dispose of
the assets thereof, having a net book value of
2
approximately $1,015,835 and a resale value of approximately $343,483. Pursuant
to the provisions of SECTION 5.05(b) of the Credit Agreement, the Agent and the
Lenders hereby consent to such discontinuance and also to the sale of such
assets, and acknowledge and agree that the foregoing shall not be deemed to be
an Event of Default; provided that (i) the aggregate gross sales price thereof
is not less than $300,000 and (ii) the Net Cash Proceeds, if any, from such sale
are paid to the Agent for application to Term Loans pursuant to SECTION 2.10(c)
of the Credit Agreement.
8. Restatement of Representations and Warranties. The Borrowers hereby
restate and renew each and every representation and warranty heretofore made by
them in the Credit Agreement and the other Loan Documents as fully as if made on
the date hereof (except where reference is expressly made to a specific date)
and with specific reference to this Third Amendment and all other loan documents
executed and/or delivered in connection herewith.
9. 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 Borrowers. The amendments contained herein shall
be deemed to have prospective application only, unless otherwise specifically
stated herein.
10. Ratification. The Borrowers hereby restate, ratify and reaffirm
each and every term, covenant and condition set forth in the Credit Agreement
and the other Loan Documents effective as of the date hereof.
11. Counterparts. This Third 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 counterparts, taken together, shall constitute but one and the same
instrument.
12. Section References. Section titles and references used in this
Third 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.
13. No Default. To induce the Agent and the Lenders to enter into this
Third Amendment and to continue to make advances pursuant to the Credit
Agreement, the Borrowers hereby acknowledge and agree that, as of the date
hereof, and after giving effect to the terms hereof, (i) there exists no Default
or Event of Default, (ii) there exists no right of offset, defense,
counterclaim, claim or objection in favor of the Borrowers arising out of or
with respect to any of the Loans or other obligations of the Borrowers owed to
the Lenders under the Credit Agreement and (iii) the Agent and each Lender has
acted in good faith and has conducted its relationships with the Borrowers in a
commercially reasonable manner in connection with the negotiations, execution
and delivery of this Third Amendment and in all respects in connection with the
Credit Agreement, each of the Borrowers hereby waiving and releasing any such
claims to the contrary that may exist as of the date of this Third Amendment.
14. Further Assurances. The Borrowers agree to take such further
actions as the Agent shall reasonably request in connection herewith to evidence
the amendments herein contained.
3
15. Governing Law. This Third Amendment shall be governed by and
construed and interpreted in accordance with, the laws of the State of Georgia.
16. Conditions Precedent. This Third Amendment shall become effective
only upon (i) payment to the Agent, for the ratable account of the Lenders, of
an amendment fee equal to $25,000, (ii) execution and delivery of this Third
Amendment by each of the parties hereto and (iii) execution and delivery by all
parties thereto of a Second Amendment of Subordinated Note and Warrant Purchase
Agreement in form and substance satisfactory to the Agent and the Lenders,
amending the Senior Subordinated Notes Purchase Agreement to conform it to the
changes contained in Sections 2, 3, 4 and 5 hereof, and consenting to the
discontinuance of the operations of Burgundy Interamericana SA de CV and
disposal of the assets thereof described in Section 8 hereof.
[SIGNATURES COMMENCE ON NEXT PAGE]
4
IN WITNESS WHEREOF, each of the Borrowers, the Agent and each of the
Lenders has caused this Third Amendment to be duly executed, under seal, by its
duly authorized officer as of the day and year first above written.
CROWN CRAFTS, INC., (SEAL)
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
______________________________
Name: ▇▇▇ ▇▇▇▇▇▇▇ Samson
________________________
Title: Vice President,
Chief Financial Officer
_______________________
▇▇▇▇▇▇▇▇▇ WEAVERS, INC.,
HAMCO, INC.
CROWN CRAFTS INFANT
PRODUCTS, INC. (SEAL)
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇ Samson
______________________________
Name: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
________________________
Title: Vice President
_______________________
WACHOVIA BANK, NATIONAL
ASSOCIATION (successor by merger
to Wachovia Bank, N.A.), (SEAL)
as Agent and as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
______________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
________________________
Title: Vice President
_______________________
5
BANC OF AMERICA STRATEGIC SOLUTIONS,
INC. (assignee of Bank of America, N.A.), (SEAL)
as a Lender
By: /s/ ▇▇▇▇ ▇. Register
________________________________
Name: ▇▇▇▇ ▇. Register
__________________________
Title: Principal
_________________________
THE PRUDENTIAL INSURANCE (SEAL)
COMPANY OF AMERICA, as a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
__________________________
Title: Vice President
_________________________
6
EXHIBIT G
COMPLIANCE CERTIFICATE
Reference is made to the Credit Agreement dated as of July 23, 2001, as
amended by First Amendment to Credit Agreement dated as of September 28, 2001,
Second Amendment to Credit Agreement dated as of November 25, 2002 and Third
Amendment to Credit Agreement dated as of February 10, 2003 (as so amended and
as thereafter modified and supplemented and in effect from time to time, the
"Credit Agreement") by and among Crown Crafts, Inc., ▇▇▇▇▇▇▇▇▇ Weavers, Inc.,
Hamco, Inc. and Crown Crafts Infant Products, Inc. (collectively or
individually, as the context shall require, the "Borrowers"), the Lenders from
time to time parties thereto, and Wachovia Bank, National Association (successor
by merger to Wachovia Bank, N.A.), as Agent. Capitalized terms used herein shall
have the meanings ascribed thereto in the Credit Agreement.
Pursuant to SECTION 5.01(c) of the Credit Agreement, ________________,
the duly authorized ______________ of the Borrowers, hereby certifies to the
Agent and the Lenders that, as of the date hereof, (i) the information contained
in the Compliance Certificate attached hereto is true, accurate and complete in
all material respects and (ii) no Default is in existence.
CROWN CRAFTS, INC. ▇▇▇▇▇▇▇▇▇ WEAVERS, INC.
HAMCO, INC.
CROWN CRAFTS INFANT PRODUCTS, INC.
BY: ___________________ (SEAL) BY: ___________________ (SEAL)
NAME: NAME:
TITLE: TITLE:
7
CROWN CRAFTS, INC.
COMPLIANCE CHECKLIST
1. Minimum EBITDA (Section 5.20(a))
Consolidated EBITDA shall not be less than, for each Fiscal Quarter set
forth below and the 3 immediately preceding Fiscal Quarters, the amount set
forth below corresponding to such Fiscal Quarter:
---------------------------------------- -------------------------------------
FISCAL QUARTER ENDING MINIMUM EBITDA
---------------------------------------- -------------------------------------
December 29, 2002 through March 30, 2004 $ 6,885,000
---------------------------------------- -------------------------------------
June 29, 2004 and each Fiscal Quarter An amount to be agreed upon in
thereafter writing by the parties, not to
exceed $8,725,000 (which amount
shall be applicable if no other
amount has been agreed upon in
writing)
---------------------------------------- -------------------------------------
(a) Consolidated EBITDA Schedule 1 $___________
Minimum Consolidated EBITDA [$6,885,000]
[$8,725,000]
[other agreed
amount]]
2. Debt/EBITDA Ratio (Section 5.20(b))
The Debt/EBITDA Ratio will not exceed, at the end of each Fiscal
Quarter set forth below, calculated as to Debt as of such Fiscal Quarter and
calculated as to Consolidated EBITDA for such Fiscal Quarter and the 3
immediately preceding Fiscal Quarters, the ratio set forth below corresponding
to such Fiscal Quarter:
----------------------------------------- -----------------------------------
FISCAL QUARTER ENDING MAXIMUM DEBT/EBITDA RATIO
----------------------------------------- -----------------------------------
December 29, 2002 through March 30, 2004 4.75 to 1.0
----------------------------------------- -----------------------------------
June 29, 2004 and thereafter A ratio to be agreed upon in
writing by the parties, not to
exceed 3.00 to 1.0 (which ratio
shall be applicable if no other
ratio has been agreed upon in
writing)
----------------------------------------- -----------------------------------
(a) Consolidated Debt Schedule 2 $___________
8
(b) Consolidated EBITDA Schedule 1 $___________
(c) actual ratio of (a) to (b) ___ to 1.00
Limitation: (c) may not exceed [4.75 to 1.0]
[3.00 to 1.0]
[other agreed ratio]
3. Senior Debt/EBITDA Ratio (Section 5.20(c))
The Senior Debt/EBITDA Ratio will not exceed, at the end of each Fiscal Quarter
set forth below, calculated as to Senior Debt as of such Fiscal Quarter and
calculated as to Consolidated EBITDA for such Fiscal Quarter and the 3
immediately preceding Fiscal Quarters (except that for the Fiscal Quarter ending
March 31, 2002, such calculation shall be for such Fiscal Quarter and the 2
immediately preceding Fiscal Quarters), the ratio set forth below corresponding
to such Fiscal Quarter:
---------------------------------------- ---------------------------------
FISCAL QUARTER ENDING MAXIMUM SENIOR DEBT/EBITDA
RATIO
---------------------------------------- ---------------------------------
March 31, 2002 4.80 to 1.0
---------------------------------------- --------------------------------
June 30, 2002 3.50 to 1.0
--------------------------------------- --------------------------------
September 29, 2002 3.25 to 1.0
---------------------------------------- --------------------------------
December 29, 2002 3.00 to 1.0
---------------------------------------- --------------------------------
March 30, 2003 2.75 to 1.0
---------------------------------------- --------------------------------
June 29, 2003 and September 28, 2.50 to 1.0
2003
---------------------------------------- --------------------------------
December 28, 2003 2.25 to 1.0
---------------------------------------- --------------------------------
March 28, 2004 through 2.00 to 1.0
September 26, 2004
---------------------------------------- --------------------------------
December 26, 2004 1.75 to 1.0
---------------------------------------- --------------------------------
March 27, 2005 and thereafter 1.50 to 1.00
---------------------------------------- --------------------------------
(a) Consolidated Senior Debt Schedule 2 $___________
(b) Consolidated EBITDA Schedule 1 $___________
9
(c) actual ratio of (a) to (b) ___ to 1.00
Limitation: (c) may not exceed [4.80 to 1.0]
[3.50 to 1.0]
[3.25 to 1.0]
[3.00 to 1.0]
[2.75 to 1.0]
[2.50 to 1.0]
[2.25 to 1.0]
[2.00 to 1.0]
[1.75 to 1.0]
[1.50 to 1.0]
4. EBITDA/Cash Interest Ratio (Section 5.20(d))
The EBITDA/Cash Interest Ratio will not be less than, at the end of each Fiscal
Quarter set forth below, for such Fiscal Quarter and the 3 immediately preceding
Fiscal Quarters (except that for the Fiscal Quarter ending March 31, 2002, such
calculation shall be for such Fiscal Quarter and the 2 immediately preceding
Fiscal Quarters), the amount set forth below corresponding to such Fiscal
Quarter:
---------------------------------------- -------------------------------------
FISCAL QUARTER ENDING MINIMUM EBITDA/CASH INTEREST RATIO
---------------------------------------- -------------------------------------
March 31, 2002 1.60 to 1.0
---------------------------------------- -------------------------------------
June 30, 2002 1.65 to 1.0
---------------------------------------- -------------------------------------
September 29, 2002 1.80 to 1.0
---------------------------------------- -------------------------------------
December 29, 2002 2.00 to 1.0
---------------------------------------- -------------------------------------
March 30, 2003 2.20 to 1.0
---------------------------------------- -------------------------------------
June 29, 2003 through 2.25 to 1.0
December 28, 2003
---------------------------------------- -------------------------------------
March 28, 2004 through 2.50 to 1.0
December 26, 2004
---------------------------------------- -------------------------------------
March 27, 2005 through 2.75 to 1.0
December 25, 2005
---------------------------------------- -------------------------------------
April 2, 2006 3.00 to 1.00
---------------------------------------- -------------------------------------
(a) Consolidated EBITDA Schedule 1 $___________
10
(b) Cash Interest Schedule 3 $___________
(c) actual ratio of (a) to (b) ___ to 1.00
Limitation: (c) may not exceed [1.60 to 1.0]
[1.65 to 1.0]
[1.80 to 1.0]
[2.00 to 1.0]
[2.20 to 1.0]
[2.25 to 1.0]
[2.50 to 1.0]
[2.75 to 1.0]
[3.00 to 1.0]
5. Minimum Stockholders' Equity (Section 5.20(e))
As of the end of each Fiscal Quarter, Stockholders' Equity will not be less than
the sum of (i) Stockholders' Equity as of the Closing Date (after giving effect
to the sale of its adult bedding line of business to its former management) plus
(ii) 75% of the cumulative (since the Closing Date) Reported Net Income
(excluding any Fiscal Quarter during which Reported Net Income is less than
$0.00) of the Parent and the Subsidiaries.
(a) Stockholders' Equity $___________
(b) Cumulative positive Reported Net Income since
the Closing Date $___________
(c) 75% of (b) $___________
(d) sum of (c) and $___________(1) $___________
Limitation: (a) must not be less than (d)
6. Capital Expenditures (Section 5.20(f))
No Borrower shall, nor shall it permit any Subsidiary to, make any expenditures
(including obligations incurred under any lease) in any Fiscal Year that are
required to be capitalized under GAAP in the aggregate for any Borrower and the
Subsidiaries, on a consolidated basis, exceeding $500,000.
(a) aggregate Capital Expenditures made to date in current
Fiscal Year $____________
Limitation: (a) may not exceed $500,000
----------------------
(1) Insert amount of Stockholders' Equity as of the Closing Date
11
7. Operating Leases (Section 5.20(g))
No Borrower shall, nor shall it permit any Subsidiary to, enter into or remain
or become liable upon any lease (other than intercompany leases between the
Borrower and its Subsidiaries) which would be characterized as an operating
lease under GAAP if the aggregate amount of all consolidated rents paid by the
Borrower and its Subsidiaries under all such leases would exceed $3,000,000 in
the first Fiscal Year following the Closing Date, with such amount increasing
each Fiscal Year thereafter by an additional 5% of the amount in effect at the
end of the preceding Fiscal Year.
(a) aggregate amount of consolidated rents payable in current
Fiscal Year $___________
Limitation: (a) may not exceed [$3,000,000](2)
----------------------------
(2) Increase after the first Fiscal Year by an additional 5% of the amount in
effect at the end of the preceding Fiscal Year
12
Schedule 1
CONSOLIDATED EBITDA
(a) Consolidated Net Income for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
(b) depreciation and amortization expenses for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
(c) Consolidated Interest Expense for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
(d) income tax expense included in Consolidated Net
Income for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
13
(e) before-tax reserve related to the closing of the
operations of Burgundy Interamericana SA de CV for:(3)
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
--------------------
(3) Include only for the following Fiscal Quarters, not exceeding following
amounts for such Fiscal Quarters: (1) for the Fiscal Quarter ending December 29,
2002, $1,775,000, (2) for the Fiscal Quarter ending March 30, 2003, $225,000 and
(3) for the Fiscal Quarter ending June 29, 2003, $275,000
14
Schedule 2
CONSOLIDATED DEBT AND CONSOLIDATED SENIOR DEBT
CONSOLIDATED DEBT(4)
(a) obligations for borrowed money $__________
(b) payment obligations evidenced by bonds, debentures notes or $__________
other similar instruments
(c) obligations to pay the deferred purchase price of property or $__________
services, except trade accounts payable and accrued expenses
arising in the ordinary course of business
(d) obligations as lessee under capital leases or leases for $__________
which the Borrowers Person retain tax ownership of the
property subject to a lease
(e) obligations to reimburse any bank or other Person in respect $__________
of amounts payable under a banker's acceptance
(f) Redeemable Preferred Stock $__________
(g) obligations to reimburse any bank or other Person in respect $__________
of amounts paid or undrawn amounts available to be paid under
a letter of credit or similar instrument
(h) Debt of others secured by a Lien on any asset of any $__________
Borrower, whether or not such Debt is assumed by such Borrower
(i) obligations with respect to interest rate protection $__________
agreements, foreign currency exchange agreements or other
hedging arrangements, other than commodity hedging agreements
entered into as risk protection rather than as an investment
(each valued as the termination value thereof computed in
accordance with a method approved by the International Swap
Dealers Association and agreed to in the applicable
agreement, if any)
----------------------------
(4) Exclude Contingent Interest and amounts payable pursuant to SECTION 2.06(a)
of the Senior Subordinated Notes Purchase Agreement
15
(j) Debt of others Guaranteed by any Borrower $__________
(k) CONSOLIDATED DEBT (sum of (a) through (i)) $__________
CONSOLIDATED SENIOR DEBT
(l) Subordinated Debt $__________
(m) CONSOLIDATED SENIOR DEBT ((j) less (k)) $__________
16
Schedule 3
CASH INTEREST
(a) interest on Revolving Loans $___________
(b) interest on Term Loans at Cash Contract Rate $___________
(c) interest on Senior Subordinated Debt $___________
(d) CASH INTEREST (sum of (a), plus (b), plus (c)) $___________
17
EXHIBIT R
CONSOLIDATED EXCESS CASH FLOW CERTIFICATE
Reference is made to the Credit Agreement dated as of July 23, 2001 ,
as amended by First Amendment to Credit Agreement dated as of September 28,
2001, Second Amendment to Credit Agreement dated as of November 25, 2002 and
Third Amendment to Credit Agreement dated as of February 10, 2003 (as so amended
and as thereafter modified and supplemented and in effect from time to time, the
"Credit Agreement") by and among Crown Crafts, Inc., ▇▇▇▇▇▇▇▇▇ Weavers, Inc.,
Hamco, Inc. and Crown Crafts Infant Products, Inc. (collectively or
individually, as the context shall require, the "Borrowers"), the Lenders from
time to time parties thereto, and Wachovia Bank, National Association (successor
by merger to Wachovia Bank, N.A.), as Agent. Capitalized terms used herein shall
have the meanings ascribed thereto in the Credit Agreement.
Pursuant to SECTION 2.01(c) of the Credit Agreement, ________________,
the duly authorized ____________________ of the Parent, hereby certifies to the
Agent and the Lenders that, as of the last day of the Annual Period ended
___________, 200__, the information contained in the Consolidated Excess Cash
Flow Certificate attached hereto is true, accurate and complete in all material
respects.
CROWN CRAFTS, INC.
By: ___________________ (SEAL)
Name:
Title:
18
CROWN CRAFTS
CALCULATION OF CONSOLIDATED EXCESS CASH FLOW
FOR ANNUAL PERIOD ENDED __________, 200__
(a) Consolidated EBITDA Schedule 1 $___________
(b) Capital Expenditures $___________
(c) taxes paid $___________
(d) Consolidated Free Cash Flow (sum of (a), less (b), less (c)) $___________
(e) Consolidated Available Free Cash Flow (85% of (d)) $___________
(f) Cash Interest paid Schedule 2 $___________
(g) aggregate of Minimum Principal Reduction Amounts paid $___________
(h) CONSOLIDATED EXCESS CASH FLOW
(sum of (e), less (f), less (g) $___________
19
Schedule 1
CONSOLIDATED EBITDA
(a) Consolidated Net Income for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
(b) depreciation and amortization expenses for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
(c) Consolidated Interest Expense for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
(d) income tax expense included in Consolidated Net
Income for:
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
20
(e) before-tax reserve related to the closing of
the operations of Burgundy Interamericana SA
de CV for:(5)
____ quarter ____ $___________
____ quarter ____ $___________
____ quarter ____ $___________
-------------------
(5) Include only for the following Fiscal Quarters, not exceeding following
amounts for such Fiscal Quarters: (1) for the Fiscal Quarter ending December 29,
2002, $1,775,000, (2) for the Fiscal Quarter ending March 30, 2003, $225,000 and
(3) for the Fiscal Quarter ending June 29, 2003, $275,000
21
Schedule 2
CASH INTEREST
(a) interest on Revolving Loans $_____________
(b) interest on Term Loans at Cash Contract Rate $_____________
(c) interest on Senior Subordinated Debt $_____________
(d) CASH INTEREST (sum of (a), plus (b), plus (c)) $_____________
22
