<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------------------------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): AUGUST 24, 2000
---------------
HANOVER DIRECT, INC.
-------------------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
1-12082
----------------------------------
(COMMISSION FILE NUMBER)
<TABLE>
<S> <C>
DELAWARE 13-0853260
----------------------------------- -----------------------------
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION) IDENTIFICATION NUMBER)
1500 HARBOR BOULEVARD
WEEHAWKEN, NEW JERSEY 07087
----------------------------------- --------------
(ADDRESS OF PRINCIPAL (ZIP CODE)
EXECUTIVE OFFICES)
</TABLE>
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (201) 863-7300
--------------
------------------------------------------------------------------------------
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
<PAGE> 2
ITEM 5. OTHER EVENTS.
On August 22, 2000, Hanover Direct, Inc., a Delaware corporation (the
"Company"), filed with the Secretary of State of the State of Delaware a
Certificate of Designations, Powers, Preferences and Rights of Series A
Cumulative Participating Preferred Stock, creating a series of Series A
Cumulative Participating Preferred Stock consisting of 2,345,000 shares, par
value $0.01 per share (the "Series A Preferred Stock.")
On August 24, 2000, the Company and Richemont Finance S.A., the
Company's largest shareholder owning approximately 48.2% of the Company's Common
Stock ("Richemont"), completed the purchase by Richemont from the Company of
1,400,000 shares of Series A Preferred Stock for a purchase price of $70.0
million pursuant to a Securities Purchase Agreement dated as of August 23, 2000
between the parties. The net proceeds of such sale were approximately $68.5
million, of which approximately $30.8 million was used to repay and retire all
amounts outstanding under the $10.0 million Line of Credit and the $25.0 million
Line of Credit provided by Richemont during March 2000. The remainder of the net
proceeds, amounting to approximately $37.7 million, will be used for development
of the Company's fulfillment and distribution centers and for working capital
and general corporate purposes. Pending such uses, the net proceeds will be used
to reduce amounts outstanding to Congress Financial Corporation ("Congress
Financial") under the revolving line of credit provided to the Company by
Congress Financial.
The Series A Preferred Stock sold to Richemont bears a dividend at the
annual rate of 15% payable quarterly in cash or in kind, has a liquidation
preference equal to its purchase price (plus accrued and unpaid dividends), has
only such voting rights as are required by law (except in the case of certain
defaults in the payment of dividends) and will be redeemable on the fifth
anniversary of the date of issuance or earlier under certain circumstances
involving a change of control, asset disposition or equity sale (all as defined
therein). The sale and issuance of the Series A Preferred Stock was approved by
the Company's Transactions Committee and its independent Directors, as well as
by Congress Financial.
The Company and Richemont have also entered into a Registration Rights
Agreement dated as of August 23, 2000 providing Richemont with certain
registration rights related to the securities of the Company owned by
Richemont, including the Series A Preferred Stock.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
Exhibit 3.1 Certificate of Designations, Powers, Preferences and
Rights of Series A Cumulative Participating Preferred Stock
Exhibit 4.1 Registration Rights Agreement between the Company
and Richemont dated as of August 23, 2000
Exhibit 10.1 Securities Purchase Agreement between the Company
and Richemont dated as of August 23, 2000
<PAGE> 3
Exhibit 20.1 Press Release dated August 25, 2000 in regard to the
sale and issuance of the Series A Preferred Stock.
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
HANOVER DIRECT, INC.
---------------------------------
(Registrant)
August 30, 2000 By: /s/Rakesh K. Kaul
---------------------------------
Name: Rakesh K. Kaul
Title: President & Chief
Executive Officer
