<PAGE>


                                      CODE
                                       of
                                BUSINESS CONDUCT
                                       and
                                     ETHICS



                                   THE GREAT
                               ATLANTIC & PACIFIC
                               TEA COMPANY, INC.




To my fellow directors, officers and employees:


                  As our Company continues to move along into the third
millennium, it is important that we work to maintain our reputation for quality,
fairness and honesty. That reputation has been built over many years, and is one
we believe must be preserved at all costs.

                  We reinforced our commitment to our fine reputation by
articulating and publishing our core values. Our core values reflect and guide
the way we do business. Very simply, our core values include integrity, respect
for all and the pursuit of excellence in everything we do.

                  The ethical conduct of companies continues to receive great
attention from the government, the press and the public. We must continue to
conduct our business in an ethical manner and welcome such scrutiny.

                  To assist you in this effort we have set down some guidelines
in this Code of Business Conduct and Ethics. These guidelines apply to many of
our everyday activities, including buying practices, record keeping, safety
practices and the like.

                  Fair and honest behavior is a matter of spirit and attitude,
and no written code of conduct can anticipate every situation that may arise in
a vigorous business environment. We need to put our core values into practice
every day, and the best way to do that is through personal example and by
reporting events which are not in the spirit of our core values.



                               Eric Claus
                               President and Chief Executive Officer
                               The Great Atlantic & Pacific Tea Company, Inc.










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                                TABLE OF CONTENTS
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                                                                                                               Page

      GENERAL STATEMENT.......................................................................................4

      HOW TO REPORT YOUR CONCERNS.............................................................................5

      CONFLICTS OF INTEREST...................................................................................6
         Financial & Business Interests.......................................................................6
         Investments..........................................................................................6
         Corporate Opportunities..............................................................................6
         Protection and Proper Use of Company's Assets .......................................................6
         Company Loans .......................................................................................6
         Relationships with Suppliers.........................................................................7
         Fair Dealing.........................................................................................7
         Premiums and Prizes..................................................................................7
         Samples..............................................................................................7
         Gifts, Gratuities and Entertainment..................................................................7

      REPORTING, RELEASE OF INFORMATION AND CONFIDENTIALITY...................................................8
         Record Keeping.......................................................................................8
         Public Company Reporting.............................................................................8
         Confidentiality......................................................................................8

      RELATIONSHIPS WITH OUTSIDE OFFICIALS....................................................................9
         Political Contributions and Involvement..............................................................9
         Bribes and Undue Influence...........................................................................9

      COMPLIANCE WITH LAWS, RULES AND REGULATIONS.............................................................9
         Antitrust Laws.......................................................................................9
         Accounting Requirements..............................................................................9
         EEO and Discrimination Laws.........................................................................10
         Securities Laws.....................................................................................10
         Intellectual Property...............................................................................10

      PROTECTING OUR ENVIRONMENT.............................................................................10

      SAFETY.................................................................................................10

      AMENDMENT, MODIFICATION AND WAIVER....................................................................11


</TABLE>


<PAGE>



GENERAL STATEMENT

                  The Great Atlantic & Pacific Tea Company, Inc. ("A&P") and its
family of companies (collectively "the Company") is committed to integrity in
the conduct of its business and requires that all directors, officers and
employees (collectively, "representatives" and each, a "representative") perform
their duties in a manner which is legally, ethically and morally unreproachable.
Reflecting our core values, the Company's standards are high: simply complying
with laws or following widespread business practices may be insufficient. It is
therefore crucial that each director, officer and employee read and understand
the information herein presented.

                  It is the responsibility of each director, officer and
employee of the Company to conduct himself or herself in a manner that will
reflect our core values and support and maintain the Company's reputation. As
representatives of the Company, it is essential that the actions of Company
representatives comply with applicable legal requirements and ethical standards.
It is likewise important that no actions taken by Company representatives appear
to others to be inconsistent with that standard. In every case, each director,
officer or employee should ask himself or herself if the conduct being
contemplated would comply with our core values and with Company policies and
would withstand public disclosure and scrutiny. By doing business in this
manner, we can insure the respect of our customers, suppliers, stockholders,
neighbors and government.

                  This Code of Business Conduct and Ethics (the "Code of
Conduct") describes certain ethical principles the Company has set for the
conduct of its business, and outlines certain key legal requirements of which
all Company representatives should be generally aware and with which all must
comply. The principles set forth herein apply to all directors, officers and
employees of the Company and are designed to deter wrongdoing and to promote
honest and ethical conduct. Adherence to the principles set forth herein is a
condition of employment. It is important to note that a violation of the Code of
Conduct may, under certain circumstances, also constitute a criminal act.

                  To assist directors, officers and employees in complying, more
detailed policy statements are available on many of the topics addressed below.
If there is uncertainty as to the applicability of any principle or policy to a
particular situation or the propriety of any contemplated course of action, the
Legal Compliance Officer should be contacted (as noted below) for assistance and
guidance.



<PAGE>


HOW TO REPORT YOUR CONCERNS

                  The Company has established monitoring and auditing systems,
which are designed to ensure compliance with applicable laws, rules, regulations
and the Code of Conduct. The cooperation of each director, officer and employee
is a key element to the successful administration of this Code of Conduct. It is
the duty of each director, officer and employee to report any conduct which he
or she believes violates applicable laws, rules, regulations or the Code of
Conduct, including any transaction or relationship that reasonably could be
expected to give rise to a conflict of interest. Company representatives are
encouraged to talk to the Legal Compliance Officer when in doubt about the best
course of action in a particular situation.

                  IF YOU HAVE INFORMATION OR CONCERNS ABOUT ANY ILLEGAL OR
UNETHICAL CONDUCT OR ANY VIOLATION OF APPLICABLE LAWS, RULES, REGULATIONS OR THE
CODE OF CONDUCT BY (a) ANY DIRECTOR, OFFICER OR EMPLOYEE OF THE COMPANY OR (b)
ANY COMPANY SUPPLIER OR VENDOR OR ANY OTHER PERSON DOING BUSINESS WITH THE
COMPANY, PLEASE PROMPTLY REPORT THE MATTER IN SUFFICIENT DETAIL TO PERMIT
APPROPRIATE INVESTIGATION AND RESPONSE. IF YOU SUSPECT UNETHICAL, IMPROPER OR
ILLEGAL CONDUCT OR PRACTICES, NOTABLY INVOLVING ACCOUNTING PRACTICES, INTERNAL
ACCOUNTING CONTROLS OR FRAUD, YOU MUST PROMPTLY REPORT YOUR CONCERNS TO:

* The Legal Compliance Officer at (201) 571-4401 in Montvale; and/or


* The Chief Internal Auditor of the Company at (201) 571-4148 in Montvale;
  and/or

* The NETWORK HOT LINE AT 1-888-277-3258.

                  Information received will be treated confidentially to the
extent practicable and in no event will any retributive action be taken against
any person who, in good faith, discloses information or reports a violation of
applicable laws, rules, regulations or the Code of Conduct.







<PAGE>


CONFLICTS OF INTEREST

                  Conflicts of interest are to be scrupulously avoided, and if
unavoidable, must be disclosed at the earliest opportunity. A "conflict of
interest" exists when an individual's private interests interfere or conflict in
any way (or even appear to or could interfere or conflict) with the interests of
the Company. A conflict situation can arise when a director, officer or employee
takes actions or has interests that may make it difficult to perform his or her
Company work objectively and effectively. Conflicts of interest also arise when
a director, officer or employee, or member of his or her family, receives or
could receive improper personal benefits as a result of his or her position in
the Company and when a director, officer or employee is, or could reasonably
appear to be, influenced, directly or indirectly, by personal considerations. If
you have any uncertainty, contact the Legal Compliance Officer for guidance.

To prevent conflicts of interest:

                  Financial & Business Interests. Directors, officers and
employees of the Company may not (i) serve as officers, directors, associates or
consultants of any company which either does business or wants to do business or
competes or seeks to compete with the Company, (ii) compete with the Company
when buying or selling property, (iii) work for another company if it is a
customer or competitor of, or if it interferes with such representative's job(s)
with, the Company, or (iv) maintain outside interests which materially interfere
with the time and attention such director, officer or employee should devote to
the Company.

                  Investments. No director, officer or employee of the Company
may invest in, own stock or other securities of, or have any other financial
interest in, any organization doing business with the Company, unless the
securities of such organization are listed on a public exchange, the
representative's interests in the organization are less than 1% and the
Company's purchases or services obtained from that organization are less than 5%
of the organization's total sales.

                  Corporate Opportunities. Directors, officers and employees are
prohibited from (a) taking for themselves personally opportunities that are
discovered through the use of corporate property, information or position, (b)
using corporate property, information (whether or not confidential) or position
for personal purposes or gain, and (c) competing with the Company.

                  Protection and Proper Use of Company's Assets. All Company
assets shall be used for legitimate business purposes. Theft, carelessness and
waste have a direct impact on the Company's profitability. Every director,
officer and employee shall protect the Company's assets and ensure their
efficient use.

                  Company Loans. The Company may not, directly or indirectly,
extend or maintain credit, arrange for the extension of credit or renew an
extension of credit, in the form of a personal loan, to or for any director or
executive officer. Loans to directors or executive officers in furtherance of
the business of the Company are not prohibited but must have the prior approval
of the Legal Compliance Officer.

                  Relationships with Suppliers. The Company encourages good
supplier relations. However, Company representatives may not benefit personally,
whether directly or indirectly, from any purchase of goods or services for or
from the Company. Individuals whose responsibilities include purchasing (be it
merchandise, fixtures, services, real estate or other), or who have contact with
suppliers, must not exploit their position for personal gain. Under no
circumstances may any Company representative receive cash or cash equivalents
from any supplier whether directly or indirectly.

                  Fair Dealing. Each director, officer and employee should
endeavor to deal fairly with the Company's customers, suppliers, competitors and
employees.

                  Premiums and Prizes. Premiums and prizes are occasionally
offered by manufacturers for the sale or purchase of certain quantities of
merchandise. The Company's buying program is not to be influenced by any
premium, prize or cash award to the buyer. Merchandise is to be purchased only
when needed to replenish inventory or when an impartial business decision has
been made to purchase a new item.

                  Samples. It is accepted business practice for vendors to
distribute samples to potential purchasers. Company policy is that, to the
extent necessary to make a reasoned appraisal of products, samples of such
products may be accepted in quantities and by Company representatives as
necessary to the business purpose.

                  Gifts, Gratuities and Entertainment. Gifts of no more than
nominal value are to be accepted by any Company representative or member of
his/her family from existing sources, prospective sources or persons, firms or
corporations with whom the Company does or might do business. Gifts and
entertainment that are acceptable are only those that reflect common courtesies
and responsible business practice. Gifts and entertainment that give the
appearance that the individual's business judgment could be affected must be
avoided and refused. We must always act in a way that reflects our core values
and will withstand close scrutiny by anyone.

See the Code of Vendor Ethics for more detailed information regarding
Relationships with Suppliers; Premiums and Prizes; Samples; and Gifts,
Gratuities and Entertainment.



<PAGE>




REPORTING, RELEASE OF INFORMATION AND CONFIDENTIALITY

                  Record Keeping. All record keeping and reporting of
information must be accurate, complete, honest and timely. The knowing or
deliberate falsification of any documents or data will be the basis for
immediate discharge and may subject such director, officer or employee to civil
and criminal sanctions as well.

                  Public Company Reporting. Dishonest reporting of information
to organizations and people inside or outside the Company, including false or
artificial entries in books and records, is strictly prohibited. It could lead
to civil or criminal liability for the applicable director, officer or employee
of the Company and for the Company itself. This includes not on1y inaccurate
reporting but also organizing or reporting information in a way that is intended
to mislead or misinform.

                  Established Company procedures for the release of information
about the Company must be followed strictly. In personal as well as business
conversation, Company representatives should limit comments about the Company to
information that has been publicly disclosed by the Company in accordance with
Company procedures.

                  Confidentiality. Information is key to our Company's success.
Every director, officer and employee must protect and maintain the
confidentiality of information that is confidential, while working at the
Company and after leaving the Company. Confidential information includes all
information entrusted to directors, officers and employees by the Company or its
customers or suppliers, except when disclosure is authorized or legally
mandated, and all non-public information that might be of use to competitors, or
harmful to the Company or its customers or suppliers, if disclosed. More
specifically, confidential information includes, but is not limited to,
financial documents, earnings estimates, pending sales or acquisitions, pricing
or vendor information, plans for future store locations, corporate developments,
the cost of goods, personnel files, manuals and procedures, computer software,
design documents, videos, memos and all other significant business information
or developments. Information which has been made public by the Company, such as
by press release, advertisement or publicly filed documents, is not considered
confidential information.

                  If a director, officer or employee is unsure whether certain
information is confidential, presume that it is. Therefore, it is important to
be careful about what is said to friends, business associates and family
members, even spouses. Finally, no representative of the Company should attempt
to obtain confidential information which does not relate to his or her
employment duties and responsibilities.

RELATIONSHIPS WITH OUTSIDE OFFICIALS

                  When dealing with public, union or other outside officials,
directors, officers and employees must avoid any activity which is, or is likely
to be perceived as, illegal or unethical, or which reflects a favoritism not
accorded to all. The appearance of impropriety may be as damaging to our Company
as an actual misdeed. Company representatives must exercise caution to prevent
relationships and dealings with public, union or other outside officials from
becoming subject to question.

                  Political Contributions and Involvement. Company
representatives are encouraged to vote and participate fully in the political
process. Such participation shall be entirely personal. The Company, from time
to time, may approve the establishment of a political action committee (PAC)
filed and operated under the laws and rules of the U.S. Federal Election
Commission or the appropriate governmental entity. Participation by Company
personnel representatives in any PAC is entirely voluntary, and any coercion to
contribute is prohibited.

                  Bribes and Undue Influence. Company policy prohibits offering
bribes, payments or gifts in any form, directly or indirectly, to any public,
union or other outside official, government employee or union official.

COMPLIANCE WITH LAWS, RULES AND REGULATIONS

                  Strict compliance with all laws, rules and regulations
affecting the conduct of the Company's business is required. Any questions as to
the applicability of any law, legal requirement or the appropriate manner of
compliance should be directed to the Legal Compliance Officer (See How to Report
Your Concerns on page 5).

                  Antitrust Laws. All directors, officers and employees must
comply with state and federal antitrust laws. The broad purpose of antitrust
laws is to promote fair and honest competition. Antitrust laws prohibit
anti-competitive behavior such as price-fixing, agreements or understandings
among competitors, and discriminatory pricing.

                  Accounting Requirements. The Company follows the accepted
accounting rules and controls as set forth by the Securities and Exchange
Commission and the Financial Accounting Standards Board. All account books,
budgets, project evaluations, expense accounts and other papers utilized in
maintaining business records of the Company must accurately reflect the matters
to which they relate. All assets of the Company must be carefully and properly
accounted for. No payment of funds of the Company shall be approved or made with
the understanding that any part of the funds will be used in a manner contrary
to this principle.

                  The Company's certified public accountants should be given
access to all information necessary for them to conduct audits properly.

                  EEO and Discrimination Laws. The Company requires strict
adherence to its policies and the laws regarding Equal Employment Opportunity
and discrimination in the workplace. Severe penalties may be imposed for
violation. All forms of unlawful harassment are similarly prohibited, including
harassment by vendors or contractors. The term "harassment" includes sexual,
racial, ethnic and other forms of harassment, including, harassment based upon a
disability. Specific Company policies, which are available on the Company's
Intranet and on GAPCOM, set forth the means through which directors, officers
and employees who have witnessed or experienced harassment may report it and
seek appropriate relief.

                  Securities Laws. It is the policy of the Company to comply
with all applicable securities laws, including insider trading laws. No
director, officer or employee may disclose "insider" information (i.e.,
material, non-public information acquired about the Company) to any outside
person or to other Company representatives except on a strict need-to-learn
basis, and no director, officer or employee may take any economic or personal
advantage of insider information, such as buying or selling stock or other
securities of the Company or of any other company to which the insider
information pertains. In addition, directors, officers and other employees of
the Company may not at any time sell Company securities short or buy or sell
"derivatives", such as options, stock appreciation rights, exchange traded
options, put and calls or other securities that relate to or derive their value
from the Company's securities.

                  Intellectual Property. The Company's intellectual property is
a very valuable asset. Intellectual property includes Company trademarks and
service marks, copyright or copyrightable materials, patents and trade secrets.

                  Intellectual property rights of the Company, as well as those
of others, must be respected. It is vital that these are protected and any
infringements reported to the Legal Compliance Officer. The Company owns all
inventions, discoveries, ideas, concepts, written material and trade secrets,
which are created during employment or are produced at the Company's direction
or using Company time or materials. Everyone is urged to cooperate in
documenting Company ownership of all intellectual property.

PROTECTING OUR ENVIRONMENT

                  Our Company is committed to protecting and improving the
environment in all areas of its operations, thereby preserving and enhancing the
quality of life of our representatives, customers and neighbors. This commitment
is a responsibility shared with all by all directors, officers and employees.

SAFETY

                  The Company strives and is committed to provide healthy and
safe workplace environments. The U.S. Occupational Safety and Health Act
regulates both physical safety and exposure to conditions in the workplace that
could harm employees. The place of employment is to be free of recognized
hazards that might cause injury or death as well as be in compliance with
applicable federal, state or provincial safety and health standards.

                  All representatives of the Company have the responsibility to
carry on their duties in a safe and efficient manner. Safety consciousness must
be a key part of each representative's thinking and planning.

                  Company representatives must report any unsafe conditions
immediately.



AMENDMENT, MODIFICATION AND WAIVER

                  Any amendment or modification of this Code of Conduct must be
in writing and approved by the Governance Committee of the Board of Directors.
Any waiver of this Code of Conduct for non-executive officers or employees may
be granted by the Legal Compliance Officer. Any waiver of this Code of Conduct
for directors or executive officers may be granted only by the Governance
Committee of the Board of Directors, subject to the disclosure and other
provisions of the Securities Exchange Act of 1934, the rules promulgated
thereunder and the applicable rules of the New York Stock Exchange.





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This booklet describes broadly the ethical standards by which we conduct our
business. If there is any uncertainty as to the applicability of any of these
standards to a particular situation or the propriety of any contemplated course
of action, the Legal Compliance Officer in Montvale, NJ should be contacted for
assistance and guidance. If you have information or concerns about any illegal
or unethical conduct, promptly make a report to the Legal Compliance Officer at
(201) 571-4401, the Chief Internal Auditor at (201) 571-4148 or the NETWORK
HOTLINE at 1-888-277-3258.
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