Bernard Chaus, Inc. Makes Announcement.

NEW YORK--(BUSINESS WIRE)--Dec. 21, 1998--Bernard Chaus, Inc. (NYSE: CHS) today announced that its Board of Directors has terminated the employment of Andrew Grossman, Chief Executive Officer. Josephine Chaus, Chairwoman of the Company, will assume the Chief Executive position, effective immediately.

Mrs. Chaus co-founded the Company in 1976 and has played an active role in managing it since that time. In addition to serving as Chairwoman since 1991, she held the positions of Chief Executive Officer from 1991 through 1994; member of the two-person Office of the Chairman from 1994 to the present; and President from 1980 through 1993. She currently owns 69.5% of the common shares outstanding.

Following the implementation of a restructuring plan launched in September 1997, Chaus reported a return to profitability for its fiscal year ended June 30, 1998 as well as a 70.1% increase in net income for its fiscal first quarter ended September 30, 1998.

Mrs. Chaus commented, "We would like to thank Andy for his contributions and wish him well. As a result of the many steps we have taken to strengthen Chaus' business and financial position and with the strong management team we have in place, I am confident we are well-positioned to report continued improvements in our performance in fiscal 1999."

Bernard Chaus, Inc. designs, sources and markets an extensive range of women's career and casual sportswear, principally under the Chaus(R) and Chaus Sport(R) trademarks. The Company's products are sold nationwide through department store chains, specialty retailers and other outlets.

This press release contains forward-looking statements which are based upon current expectations and involve a number of uncertainties, including retail market conditions, and the continuation of the current favorable trend in sales. Further information on potential factors which could affect the Company's financial results are included in the Company's Form 10-K for the year ended June 30, 1998 and Form 10-Q for the periods ended September 30, 1998, March 31, 1998 and December 31, 1997, and the Company's rights offering prospectus dated December 10, 1997.