ISS Proxy Advisory Services Recommends Stockholders Vote for Wynnefielda?s Nominees

NEW YORK--([ BUSINESS WIRE ])--The Wynnefield Group, the largest stockholder in Crown Crafts Inc. (NASDAQ: CRWS), today announced that leading independent proxy voting and corporate governance advisory firms ISS Proxy Advisory Services and PROXY Governance, Inc. have recommended that Crown Crafts stockholders vote Wynnefielda�s GOLD proxy card in connection with the Companya�s August 10, 2010 Annual Meeting of Stockholders.

"CRWS board may benefit from the addition of experienced directors having specific strategic, governance and transaction related expertise to face growth and business challenges going forward."

ISS recommended that Crown Crafts stockholders vote on Wynnefielda�s GOLD proxy card for both Wynnefield nominees a" Jon C. Biro and Melvin L. Keating. ISS noted that aboth dissident nominees are seasoned executives that have a high degree of finance acumen and multiple public board experiencea (emphasis added).

In determining that change is warranted at Crown Crafts, ISS wrote of the management-endorsed Board majority that, aWe have also noted a history of problematic compensation and governance practices which seem poorly aligned with the long-term interests of shareholdersa (emphasis added).

In its recommendation for Wynnefielda�s nominees, ISS pointed to several factors, including:

Lavish Employment and Severance Agreements. ISS criticized the Companya�s employment agreements and golden parachutes, stating that, aThe provisions associated with these executivesa� change in control agreements are misaligned with maximizing shareholder return and best corporate governance practices. It appears that these provisions seem to accentuate the control that Mr. Chestnut has over the company.a
Crown Craftsa� Valuation Lags Peers. ISS wrote that, aCRWS trades at a material discount to its peers and the discount has widened in the last year.a
Lackluster Financial Performance. The analysis concluded that from 2006 to 2010 aa it appears that organic revenues have declined from $72.6 million to $69.8 million (a negative 1.0 percent compounded annual growth rate). This supports Wynnefielda�s argument that CRWS management has failed to grow the organic business.a

aThe anemic revenue growth of the total company, even with [the recent] acquisitions, also supports the dissidenta�s contention that the organic business has been stagnant at best.a
Questionable Corporate Governance Motivations. Of the Boarda�s recent announcements regarding its apoison pilla, ISS wrote, aIn part in response to the dissidenta�s concerns about the companya�s governance provisions, the board determined this week to terminate as of July 31, 2010, the shareholders rights plan (apoison pilla)a While we commend the board for taking this action, the time and reactive nature of the boarda�s action calls into question the boarda�s motivations.a

ISS concluded its analysis by noting that ait appears dissident activism may have been largely responsible for triggering the strategic review process as well as the announcements about the dissolution of the longstanding poison pill, the focus on growing international revenues and managementa�s intentions to broaden awareness of the company by actively engage (sic) in investor/industry conferencesa and further said that the aCRWS board may benefit from the addition of experienced directors having specific strategic, governance and transaction related expertise to face growth and business challenges going forward.a

Of Wynnefielda�s nominees, ISS wrote that, aMr. Biro has demonstrated a sense of urgency addressing shareholder unfriendly corporate governance issues,a highlighting that awithin the first years while serving as director and interim CEO at ICO, Mr. Biro was part of a management team that successfully acceleratedathe expiration of the poison pill.a It also notes that Mr. Keating ahas experience serving on and leading committees including: audit (chair) and strategic alternative review committee at Infologix and the audit and operations committee at White Electronic Designs Corp.a

In its report recommending that stockholders vote on Wynnefielda�s GOLD card, PROXY Governance pointed to the ainward-looking board culture, which, together with the formal governance structure, handicaps its ability to take full-stock of the strategic challengesa (emphasis added). The report goes on to state that, aTo this end, we favor further changes to the board and the creation of a standing Strategic Review Committee which is empowered to retain an independent consultanta (emphasis added).

The firm adds that it has doubts aover the boarda�s ability to objectively review [the Companya�s] challenges and strategic optionsa (emphasis added) and is aconcerned about [Crown Craftsa�] ability to drive long-term value.a PROXY Governance states that, aa as a percentage of pre-tax income, [Crown Craftsa� executive severance] payouts are excessive. Further, we disagree as a matter of principle with the gross-up provisions that are provided under the agreementsa (emphasis added).*

These independent reports validate Wynnefielda�s critique of Crown Craftsa� business performance, lack of a strategic plan and sub-standard corporate governance.

VOTE THE GOLD PROXY CARD FOR STOCKHOLDER VALUE

For additional information, Crown Crafts stockholders should contact Wynnefielda�s proxy solicitor Okapi Partners at (877) 285-5990 (Toll-Free) or (212) 297-0720 (Call Collect).

*Permission to use quotations was neither sought nor obtained.

ABOUT THE WYNNEFIELD GROUP

The Wynnefield Group is Crown Craftsa� largest stockholder, holding approximately 17% of the Companya�s outstanding common stock. Established in 1992, the Wynnefield Group includes several affiliates of Wynnefield Capital, Inc., a value investor specializing in U.S. small cap situations that have company- or industry-specific catalysts.

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ISS Proxy Advisory Services Recommends Stockholders Vote for Wynnefielda?s Nominees