Phoenix Footwear Group CEO Cathy Taylor and Chief Financial Officer
Doug Ford stepped down from their positions. The company has also
restructured its operations, eliminating 17
positions for an annual cost savings of approximately $2.5 million.
These reductions are effective today and will result in a charge for
severance during the first quarter of 2009.

The moves follow a review of its strategic alternatives with the
assistance of BB&T Capital Markets, a division of Scott &
Stringfellow, Inc. Besides the management change and job cuts, the
footwera company said it is exploring divesting or exiting certain
operations. To date, no definitive agreements have been reached for
such transactions, nor can any assurances be given that any such
transactions will be approved or consummated.

In the wake of these changes Russell Hall has been named president and
chief executive officer of Phoenix Footwear Group while Dennis Nelson
has been named chief financial officer. Hall has been with the company
since 2000 and most recently has been responsible for its Trotters,
SoftWalk and Chambers divisions. Dennis Nelson has been the company's
controller since June of 2008, prior to which he was Director of
Finance for TaylorMade-adidas Golf Company.

The company expects to be reporting year end results in late March;
however, it does not intend to provide ongoing disclosure with respect
to its strategic efforts until a definitive agreement is approved
unless disclosure is otherwise appropriate.