EXHIBIT 10.1

                                                                  EXECUTION COPY

================================================================================


                           EIGHTH AMENDMENT AGREEMENT

                           DATED AS OF JANUARY 3, 2003

                                      AMONG

                           LILLIAN VERNON CORPORATION,

                                  AS BORROWER,

                   LILLIAN VERNON FULFILLMENT SERVICES, INC.,

                           LVC RETAIL CORPORATION AND

                       LILLIAN VERNON INTERNATIONAL, LTD.

                                 AS GUARANTORS,

                               JPMORGAN CHASE BANK
                  (FORMERLY KNOWN AS THE CHASE MANHATTAN BANK),

                                    AS AGENT,

                                       AND

                             THE BANKS NAMED HEREIN

                            ------------------------

               TO THE CREDIT AGREEMENT DATED AS OF AUGUST 19, 1996

                            -------------------------


================================================================================


<PAGE>


     THIS EIGHTH AMENDMENT AGREEMENT, dated as of January 3, 2003 (this
"Amendment"), among LILLIAN VERNON CORPORATION, a Delaware corporation (the
"Borrower"), LILLIAN VERNON FULFILLMENT SERVICES, a Virginia corporation
("LVFS"), LVC RETAIL CORPORATION, a Delaware corporation ("LVC"), and LILLIAN
VERNON INTERNATIONAL, LTD., a New York corporation ("LVI Inc.", and together
with LVFS and LVC, the "Guarantors"), the several banks from time to time
parties to the Agreement (as defined below) (the "Banks") and JPMORGAN CHASE
BANK (formerly known as The Chase Manhattan Bank), a New York banking
corporation, as agent for the Banks hereunder (in such capacity, the "Agent");


                              W I T N E S S E T H :

     WHEREAS, the parties hereto have entered into a Revolving Credit Agreement
dated as of August 19, 1996 (as amended, restated, supplemented or otherwise
modified from time to time, the "Agreement");

     WHEREAS, the Borrower has requested the Banks reduce the amount of the
credit facility and amend certain financial covenants of the Borrower, effective
as of the date hereof (the "Amendment Effective Date"); and

     WHEREAS, the Borrower and Guarantors desire, and each Bank and the Agent
are willing, on the terms and conditions set forth below, to modify certain
terms of the Agreement as set forth below;

     NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto hereby agree as follows:

     SECTION 1. DEFINED TERMS. Capitalized terms used herein and not defined
herein shall have the meanings specified in the Agreement.

     SECTION 2. AMENDMENT TO THE AGREEMENT.

     (a) Schedule 2.01 to the Agreement is hereby amended by deleting such
schedule in its entirety and inserting in lieu thereof the Schedule 2.01
attached to this Amendment.

     (b) Section 6.11 of the Agreement is hereby amended by deleting such
Section in its entirety and inserting in lieu thereof the following:

          SECTION 6.11. Consolidated Net Income. Permit Consolidated Net Income
     to be less than zero for any fiscal year, calculated in accordance with
     GAAP; provided that for the fiscal periods set forth below the Borrower may
     have a net loss of up to but not exceeding the Permitted Net Loss set forth
     opposite such period as follows:

                Fiscal Period                               Permitted Net Loss
                -------------                               ------------------

                Fiscal Year 2002 ...........................    $10,000,000
                Fiscal Year 2003,
                  first quarter ............................    $ 6,000,000
                  first two quarters, year to date .........    $11,000,000
                  first three quarters, year to date .......    $15,300,000
                  four quarters, year to date ..............    $ 6,750,000


<PAGE>


     (c) Section 6.14 of the Agreement is hereby amended by deleting such
Section in its entirety and inserting in lieu thereof the following:

          SECTION 6.14. Consolidated Tangible Net worth Plus Subordinated Debt.
     With respect to each fiscal period set forth below, at any time permit the
     sum of Consolidated Tangible Net Worth plus Subordinated Debt to be less
     than the amount set forth opposite such period as follows:

       Fiscal Period      Consolidated Tangible Net Worth plus Subordinated Debt
       -------------      ------------------------------------------------------

     4th Quarter 2002                          $85,000,000
     1st Quarter 2003                          $80,000,000
     2nd Quarter 2003                          $75,000,000
     3rd Quarter 2003                          $74,500,000
     4th Quarter 2003                          $80,000,000
     1st Quarter 2004                          $78,000,000
     2nd Quarter 2004                          $75,000,000
     3rd Quarter 2004                          $80,000,000
     4th Quarter 2004                          $80,000,000
     1st Quarter 2005                          $80,000,000
     2nd Quarter 2005                          $75,000,000
     3rd Quarter 2005                          $80,000,000
     4th Quarter 2005                          $80,000,000

     SECTION 3. CONDITIONS TO EFFECTIVENESS. This Amendment shall become
effective only upon the satisfaction or waiver of all of the following
conditions precedent:

     (A) The parties hereto shall have duly executed and delivered this
Amendment.

     (B) The Agent shall have received certificates of the Secretary or
Assistant Secretary of the Borrower and each of the Guarantors dated as of the
Amendment Effective Date, certifying: (i) that its respective By-laws either are
attached to such certificate, or to the extent not attached have not been
amended since the Closing Date, (ii) that its respective charter or certificate,
as the case may be, either is attached to such certificate or to the extent not
attached has not been amended since the Closing Date, and (iii) as to the
incumbency and signatures of each of its respective officers executing this
Amendment and any other documents to which it is a party.


                                       2
<PAGE>


     (C) The Agent shall have received from the Borrower the fees and expense
reimbursements referred to under Section 7 hereof.

     SECTION 4. REPRESENTATIONS AND WARRANTIES. In order to induce the Banks and
Agent to enter into this Amendment, the Borrower and the Guarantors hereby
jointly and severally represent and warrant to the Agent: (i) that the
representations and warranties contained in the Agreement are true and correct
on and as of the Amendment Effective Date as though made on and as of such date,
except for changes which have occurred and which were not prohibited by the
terms of the Agreement; (ii) that no Default or Event of Default has occurred
and is continuing, or would result from the execution, delivery and performance
by the Borrower and the Guarantors, of this Amendment or the Agreement (as
amended by this Amendment); (iii) that the Borrower and the Guarantors have full
power, right and legal authority to execute, deliver and perform its obligations
under this Amendment; (iv) that the Borrower and Guarantors have taken all
action necessary to authorize the execution and delivery of, and the performance
of its obligations under this Amendment; and (v) that this Amendment constitutes
a legal, valid and binding obligation of the Borrower and the Guarantors
enforceable against each of them in accordance with its terms, subject to the
effect of any applicable bankruptcy, insolvency, reorganization or moratorium or
similar laws affecting the rights of creditors generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law).

     SECTION 5. GUARANTY. The Guarantors each acknowledge receipt of a copy of
this Amendment Agreement and hereby ratify and affirm their guaranty of the
Obligations of the Borrower under the Agreement as amended hereby.

     SECTION 6. REFERENCE TO AND EFFECT ON THE DOCUMENTS. Each reference in the
Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like
import, and each reference to the Agreement in documents related to the
Agreement, shall mean and be a reference to the Agreement as amended hereby.
Except as specifically amended hereby, the Agreement and all such related
documents, and all other documents, agreements, instruments or writings entered
into in connection therewith, shall remain in full force and effect and are
hereby ratified, confirmed and acknowledged by the Borrower.

     SECTION 7. FEES AND EXPENSES. The Borrower agrees to pay or reimburse the
Agent, as stated in Section 10.05 of the Agreement (as amended hereby), for its
reasonable out-of-pocket costs and expenses, including, without limitation, the
reasonable fees and disbursements of counsel to the Agent incurred by the Agent
in connection with the preparation, reproduction, execution and delivery of this
Amendment and any other instruments and documents to be delivered hereunder.

     SECTION 8. GOVERNING LAW. This Amendment and the rights and obligations of
the parties hereunder shall be governed by and construed and interpreted in
accordance with the substantive laws of the State of New York, without regard to
its conflict of laws principles.

     SECTION 9. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any party hereto may execute this Amendment by signing any such
counterpart.


                                       3
<PAGE>


     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.

                                             JPMORGAN CHASE BANK,
                                             As Bank and as Agent,

                                             By: /s/ MARGARET NOLAN
                                                ---------------------------
                                                 Name:  Margaret Nolan
                                                 Title: Vice President



                                             SUNTRUST BANK

                                             By: /s/ VERNON M. TOWLER
                                                 ---------------------------
                                                   Name:  Vernon M. Towler
                                                   Title: Senior Vice President


                                       4
<PAGE>


                       SIGNATURE PAGE TO EIGHTH AMENDMENT
                       TO LILLIAN VERNON CREDIT AGREEMENT


                                             LILLIAN VERNON CORPORATION


                                             By: /s/ RICHARD P. RANDALL
                                                 ---------------------------
                                                 Name:  Richard P. Randall
                                                 Title: Executive Vice President
                                                        Chief Operating Officer
                                                        Chief Financial Officer



                                             LILLIAN VERNON FULFILLMENT
                                             SERVICES, INC.


                                             By: /s/ SUSAN C. HANDLER
                                                 ---------------------------
                                                 Name:  Susan C. Handler
                                                 Title: Secretary



                                             LVC RETAIL CORPORATION


                                             By: /s/ HARRIET KRAYNIK
                                                 ---------------------------
                                                 Name:  Harriet Kraynik
                                                 Title: Secretary-Treasurer




                                           LILLIAN VERNON INTERNATIONAL, INC.


                                             By: /s/ Susan C. Handler
                                                 ---------------------------
                                                 Name:  Susan C. Handler
                                                 Title: Secretary


                                       5
<PAGE>


                                  SCHEDULE 2.01

                          COMMITMENTS

                           TRANCHE 1

                                                     TRANCHE 1
                                                     COMMITMENT AMOUNT FOR
TRANCHE 1                                            FIRST AND SECOND QUARTERS
BANK                                                 OF BORROWER'S FISCAL YEAR
---------                                            -------------------------

JPMORGAN CHASE BANK                                       $ 5,000,000
SUNTRUST BANK                                             $ 5,000,000
                                                          -----------
TOTAL (for 1st and 2nd quarters)                          $10,000,000

                                                     TRANCHE 1
                                                     COMMITMENT AMOUNT FOR
TRANCHE 1                                            THIRD AND FOURTH QUARTERS
BANK                                                 OF BORROWER'S FISCAL YEAR
---------                                            -------------------------

JPMORGAN CHASE BANK                                       $ 7,500,000
SUNTRUST BANK                                             $ 7,500,000
                                                          -----------
TOTAL (for 3rd and 4th quarters)                          $15,000,000


                                        TRANCHE 2

TRANCHE 2                                            TRANCHE 2
BANK                                                 COMMITMENT AMOUNT
---------                                            -----------------

JPMORGAN CHASE BANK                                       $12,000,000
                                                          -----------
TOTAL                                                     $12,000,000


                                       6