Hanover Direct, Inc. and Chelsey Direct, LLC Execute Recapitalization Agreement and Announce Reconstituted Board of Directors an

Hanover Direct, Inc. and Chelsey Direct, LLC Execute Recapitalization Agreement
and Announce Reconstituted Board of Directors and Board Committees 


EDGEWATER, N.J., Nov. 19  /PRNewswire-FirstCall/ -- Hanover Direct, Inc.
announced today that the Company entered into a binding Recapitalization
Agreement with Chelsey Direct, LLC as contemplated by the Memorandum of
Understanding executed last week. The closing of the transactions contemplated
by the Recapitalization Agreement will occur as promptly as practicable
following the execution of the Recapitalization Agreement and will require the
approval of Congress Financial Corporation, the Company's lender, and the
American Stock Exchange.

The Recapitalization Agreement has been unanimously approved by the Transactions
Committee, composed of independent directors of the Board of Directors of the
Company, which has received a fairness opinion from independent financial
advisors stating that the terms of the Recapitalization are fair to the holders
of Common Stock of the Company (other than Chelsey Direct, LLC and its
affiliates) from a financial point of view.  Subsequent to the approval and
recommendation of the Transactions Committee, the Recapitalization Agreement was
unanimously approved by Hanover's Board of Directors.

Coincident with the execution of the Recapitalization Agreement, the Board of
Directors of Hanover Direct, Inc. has been reconstituted.  Messrs. Jeffrey
Sonnenfeld, Ken Krushel and Pen James have resigned from the Board and Messrs.
Stuart Feldman and William Wachtel have joined the Board.  The Company will be
filing with the Securities and Exchange Commission and distributing to all of
its shareholders an information statement regarding the anticipated change in a
majority of the Board of Directors pursuant to Rule 14f-1 promulgated under the
Securities Exchange Act of 1934, as amended, and upon expiration of the ten (10)
day waiting period required by Rule 14f-1, Mr. Donald Hecht will also be
appointed to the Board.

Mr. Wachtel has been a managing partner of Wachtel & Masyr, or its predecessor
law firm, Gold & Wachtel, LLP, since its founding in August 1984. He is the
co-founder of the Drum Major Institute, a not-for-profit organization carrying
forth the legacy of Dr. Martin Luther King.

Stuart Feldman has been a principal of Chelsey Capital, LLC, a private hedge
fund, for the past ten years. Donald Hecht has managed Hecht & Company, an
accounting firm, since 1966.

"First, we want to thank Jeffrey Sonnenfeld, Ken Krushel and Pen James for their
exemplary service on the Board and their many, many contributions to the
continued turnaround of the Company including their deliberations leading to
this transaction," said Tom Shull, Hanover Direct's Chairman, President and
Chief Executive Officer. "Second, the Company welcomes Stuart Feldman and
William Wachtel to the Board."

Simultaneously with the execution of the Recapitalization Agreement, the
Committees of the Board of Directors were also reconstituted as follows: the
members of the Executive Committee are Stuart Feldman (Chairman), Martin Edelman
and Basil Regan; the members of the Audit Committee are Robert Masson
(Chairman), Wayne Garten and David Brown (Donald Hecht will be added to the
Audit Committee at the same time he is added to the Board of Directors); the
members of the Stock Option and Executive Compensation Committee are David Brown
(Chairman), Wayne Garten and Stuart Feldman; the members of the Nominating
Committee are William Wachtel (Chairman), Wayne Garten and Thomas Shull; and the
members of the Transactions Committee are Martin Edelman (Chairman), David Brown
and Basil Regan.

About Hanover Direct, Inc.

Hanover Direct, Inc. (AMEX:HNV) and its business units provide quality, branded
merchandise through a portfolio of catalogs and e-commerce platforms to
consumers, as well as a comprehensive range of Internet, e-commerce, and
fulfillment services to businesses. The Company's catalog and Internet portfolio
of home fashions, apparel and gift brands include Domestications, The Company
Store, Company Kids, Silhouettes, International Male, Scandia Down, and Gump's
By Mail. The Company owns Gump's, a retail store based in San Francisco. Each
brand can be accessed on the Internet individually by name. Keystone Internet
Services, LLC (http://www.keystoneinternet.com/), the Company's third party
fulfillment operation, also provides the logistical, IT and fulfillment needs of
the Company's catalogs and web sites.  Information on Hanover Direct, including
each of its subsidiaries, can be accessed on the Internet at
http://www.hanoverdirect.com/. 

DATASOURCE: Hanover Direct, Inc.



CONTACT:  Charles E. Blue, SVP & Chief Financial Officer of Hanover

Direct, Inc., [phone]; or Rich Tauberman of The MWW Group,

[phone], for Hanover Direct, Inc. 



Web site:  http://www.hanoverdirect.com/

http://www.keystoneinternet.com/ 

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