Hanover Direct, Inc. Transaction Bonus Letter Agreement with Executive

Summary

This agreement between Hanover Direct, Inc. and an executive employee confirms that the employee will receive a transaction bonus equal to a specified percentage of their annual base salary if a Change of Control occurs, as defined in the company's compensation plan. The bonus is paid in a lump sum at closing, provided the employee is still actively employed at that time. If the employee resigns or is terminated for cause before the Change of Control, the bonus is forfeited. Any disputes will be resolved through binding arbitration.

EX-10.86 11 y84434exv10w86.txt FORM OF TRANSACTION BONUS LETTER EXHIBIT 10.86 FORM OF TRANSACTION BONUS LETTER To: [Name] From: Thomas C. Shull Date: November __, 2002 Dear _____, This is to confirm that you shall be granted a transaction bonus equal to __% of your annualized base salary upon the occurrence of a Change of Control. "Change of Control" is defined in the Hanover Direct, Inc. Key Executive Eighteen Month Compensation Continuation Plan effective as of April 25, 2001, as amended (the "Plan"). This bonus, payable in one lump sum on the date of closing of any transaction which constitutes a Change of Control, will be paid to you only if you are actively employed by the Company on the date the Change of Control occurs. Your voluntary termination or an involuntary termination for cause will cancel this obligation, the transaction bonus becoming null and void. Any dispute arising from this Agreement will be settled through binding arbitration, by an arbitrator mutually acceptable to the parties. HANOVER DIRECT, INC. Accepted by: By:_________________________________ _________________________ Thomas C. Shull, Chairman, [Name] President and Chief Executive Officer