WEEHAWKEN, NJ, December 13, 1999 - Hanover Direct, Inc. (AMEX: HNV) today announced that its Web Services Division has been named erizon. This is a strategic move designed to hone the focus of the division and to reflect the company's push towards the future.

"The naming of erizon formalizes Hanover Direct's ongoing metamorphoses into a leading provider of e-commerce services and branded merchandise," stated Rakesh K. Kaul, President and Chief Executive Officer of Hanover Direct, Inc. "The name crystallizes the identity of Hanover's business to business e-commerce activities and the future of those activities. erizon is derived from three motivators: the concept of the Internet, represented by the e; the promise of rising and becoming an industry leader; and the limitless future of this division as represented by the horizon. erizon's mission is to be the leading end-to-end e-commerce and i builder solutions provider."

Hanover Direct, Inc. recognized very early on the potential of e-commerce and of the Internet and the need to continuously evolve to keep ahead of the competition and to maintain Ôfirst-mover advantage' in this ever-emerging space. Hanover Direct was one of the first companies to see the value of a dynamic, flexible and scalable platform. It has forged significant IT alliances in an effort to provide the latest in technology for its platform.

erizon is comprised of Keystone Internet Services, Hanover's third party, end-to-end, fulfillment, logistics and e-care provider and Desius, Hanover's Joint Venture with RS Software India, Limited, offering 24/7-web shop services and e-commerce systems development. These strategic business units function together to offer third party clients a complete end-to-end solution for back-office needs. erizon will also service the logistical, IT and fulfillment needs of the captive Hanover brands themselves.

"erizon possesses significant, formidable assets, " stated Michael Lutz, Chief Operating Officer of Hanover Direct, Inc. "These assets include a 1999 projected revenue base of $130 million, a dedicated employee base of 1,500 worldwide, 18 Keystone Internet Services third party clients and 14 Desius third party clients. More importantly, erizon operates off a world-class technology platform providing a solid basis from which to meet the demands of clients in the future and to rise to the top of the industry. erizon not only has a vision for the future, it has the resources to make it a reality."

Ralph Bulle, Senior Vice President of Human Resources for Hanover Direct, Inc. added, "The Company has retained Heidrick & Struggles, Inc. to conduct a search for the President of erizon. This individual will have a leadership opportunity to build an anchor business in the new retail economy of general merchandise e-commerce."

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 Hanover Brands division is comprised of the Company's catalog and e-commerce web site portfolio of home fashions, apparel and gift brands, including Domestications, The Company Store, Turiya, Domestications Kitchen & Garden, Kitchen & Home, Encore, Improvements, The Safety Zone, Silhouettes, Tweeds, International Male, Undergear, and Gump's By Mail. Hanover Direct is the exclusive distributor of the Compagnie de la Chine brand in North America; the Company owns Gump's, a retail store based in San Francisco; and, the Company has a majority equity stake in Always In Style®. Each brand can be accessed on the Internet individually by name. The Web Services division is comprised of the Company's Internet marketing services group, systems platform, fulfillment and telemarketing and third party fulfillment service vendor, Keystone Internet Services, Inc.
(www.keystoneinternet.com). Information on Hanover Direct, including each of its divisions, can be accessed on the Internet at www.hanoverdirect.com.

Forward Looking Statements

"The naming of erizon formalizes Hanover Direct's ongoing metamorphoses into a leading provider of e-commerce services and branded merchandise."

"erizon's mission is to be the leading end-to-end e-commerce and i builder solutions provider."

"These assets include a 1999 projected revenue base of $130 million, a dedicated employee base of 1,500 worldwide, 18 Keystone Internet Services third party clients and 14 Desius third party clients. More importantly, erizon operates off a world-class technology platform providing a solid basis from which to meet the demands of clients in the future and to rise to the top of the industry. erizon not only has a vision for the future, it has the resources to make it a reality."

Cautionary Statements

The following material identifies important factors, which could cause actual results to differ materially from those in the forward looking statements identified above or elsewhere in this press release:

A general deterioration of economic conditions in the United States leading to increased competitive activity, including a business failure of a substantial size company in the retail industry, a reduction in consumer spending generally, or specifically with reference to the types of merchandise the Company or its third party clients offers in its catalogs. The failure of the Internet generally to achieve the projections made for it with respect to growth of e-commerce or otherwise.

The ability of the Company's computer systems to connect with the systems of others, and to be able to serve the others' fulfillment needs.

The Company has a history of operating losses. Continuation or reemergence of the operating losses may prevent the Company from making the investments in e-commerce that are required to be made to achieve a position of leadership in serving the e-commerce needs of companies doing business, or desiring to do business, on the Internet. Also acquisitions may be prevented by the continuation of operating losses.

The ability of the Company to fund or accommodate its planned growth.

The ability of the Company to attract management with the requisite experience in e-commerce or in Internet businesses and to develop a culture that is consistent with the manner in which e-commerce is managed.

The ability of the Company to service the customers of its Keystone Internet Services subsidiary satisfactorily during the important holiday selling season.

The emergence of one or more strong competitors to the Company's Web Services division with greater resources than the Company.

The failure of the holiday selling season to provide expected sales for the Company's brands, third party clients or retailers generally.  

CONTACT:
AGG International, Public Relations
Paula Zwerdling
Managing Director
(212) 869-8230

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