<PAGE>
                                                                   EXHIBIT 10.91

















                              HANOVER DIRECT, INC.

                                       AND

                                  SUBSIDIARIES

                            CORPORATE CODE OF CONDUCT
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<S>     <C>                                                                        <C>
I.      CITIZENSHIP AND PUBLIC RESPONSIBILITY........................................3
   1.   COMPLIANCE WITH LAWS, RULES AND REGULATIONS..................................3
   2.   RELATIONS WITH CUSTOMERS.....................................................3
   3.   STATEMENTS IN ADVERTISING....................................................4
   4.   COMPETITION..................................................................4
   5.   PROPER ACCOUNTING AND FINANCIAL INTEGRITY....................................5
   6.   ACCURATE PERIODIC REPORTS....................................................5
II.     USE OF COMPANY ASSETS, FACILITIES AND SERVICES...............................6
   1.   IMPROPER PAYMENTS............................................................6
   2.   POLITICAL CONTRIBUTIONS......................................................6
   3.   SAFEGUARDING ASSETS..........................................................7
III.    SELECTION OF VENDORS AND SUPPLIERS OF GOODS AND SERVICES.....................7
IV.     CONFLICT OF INTEREST; CORPORATE OPPORTUNITY..................................7
V.      SECURITIES TRADING...........................................................8
   1.   INSIDE INFORMATION...........................................................8
   2.   TRADING GUIDELINES...........................................................9
   3.   REPORTING AND OTHER OBLIGATIONS.............................................10
VI.     ENVIRONMENT, HEALTH AND SAFETY..............................................10
VII.    EMPLOYMENT ISSUES...........................................................10
   1.   EQUAL OPPORTUNITY...........................................................10
   2.   HARASSMENT AND DISCRIMINATION...............................................10
   3.   DRUG AND ALCOHOL ABUSE......................................................12
   4.   DISABILITY..................................................................13
VIII.   INFORMATION SYSTEM USE......................................................13
   1.   INFORMATION SYSTEM..........................................................13
   2.   BUSINESS RECORDS & DOCUMENTATION............................................13
   3.   USING THE INFORMATION SYSTEM................................................13
   4.   OBTAINING SECURITY ACCESS...................................................13
   5.   INTERNET USE................................................................14
   6.   RESTRICTED INFORMATION......................................................14
   7.   PROTECTION OF COMPANY ELECTRONIC DATA AND INFORMATION
         PASSWORDS/VIRUSES/DATA SECURITY............................................14
   8.   NON-STANDARD SOFTWARE.......................................................15
   9.   REMOTE ACCESS...............................................................15
   10.  UNACCEPTABLE ACTIVITIES.....................................................15
   11.  REPORTING SECURITY PROBLEMS.................................................16
IX.     CONFIDENTIAL INFORMATION....................................................16
X.      DUTY TO RETURN CONFIDENTIAL INFORMATION AND COMPANY PROPERTY UPON
         SEPARATION FROM THE COMPANY................................................17
XI.     INTERNAL COMMUNICATION AND ENFORCEMENT OF POLICY............................17
XII.    REPORTING OF ANY ILLEGAL OR UNETHICAL BEHAVIOR..............................17
XIII.   AMENDMENTS TO AND WAIVERS OF THE CODE OF CONDUCT............................18
XIV.    COMPLIANCE PROCEDURES.......................................................18
XV.     INTERPRETATION OF CODE OF CONDUCT AND EFFECTS OF FAILURE TO COMPLY..........18
XVI.    STATEMENT NOT A CONTRACT OF EMPLOYMENT......................................18
XVII.   NAMES AND NUMBERS...........................................................19
</TABLE>
<PAGE>
                              HANOVER DIRECT, INC.
                                       AND
                                  SUBSIDIARIES

                            CORPORATE CODE OF CONDUCT

This Corporate Code of Conduct (the "Code of Conduct") has been unanimously
adopted by the Board of Directors of Hanover Direct, Inc. (the "Company") and is
intended to apply to all business activities conducted on behalf of the Company.
References in this Code of Conduct to the Company means the Company or any of
its subsidiaries. (March 1, 2003)

I.    CITIZENSHIP AND PUBLIC RESPONSIBILITY

The success of the Company is predicated on conducting business affairs in a way
that is socially responsible while seeking to promote that most important
dynamic of private enterprise: earning the profits which make possible the
continued existence and growth of the enterprise, the satisfaction of investors'
expectations of a fair return on their investment, the providing of jobs for
employees, and a contribution to the well-being of our various communities.

1.    COMPLIANCE WITH LAWS, RULES AND REGULATIONS

Recognition of the public interest must be a permanent commitment of the Company
in the conduct of its affairs. The activities of the Company and all of its
employees, officers and directors ("employees"), acting on its behalf must
always be in full compliance with both the letter and spirit of all laws, rules
and regulations applicable to our business. Furthermore, no employee should
assist any third party in violating any applicable law, rule or regulation. This
principle applies whether or not such assistance is, itself, unlawful. All
employees must respect and obey the laws of the cities, states and countries in
which we operate and avoid even the appearance of impropriety. When there is a
doubt as to the lawfulness of any proposed activity, advice must be sought from
the Executive Vice President - Human Resources & Legal.

Violation of applicable laws, rules or regulations may subject the Company, as
well as any employees involved, to severe adverse consequences, including
imposition of injunctions, monetary damages (which could far exceed the value of
any gain realized as a result of the violation, and which may be tripled in
certain cases), fines and criminal penalties, including imprisonment. In
addition, actual or apparent violations of applicable laws, rules and
regulations by the Company or its employees can undermine the confidence of the
Company's customers, investors, creditors and bankers, as well as that of the
general public. Employees who fail to comply with this Code of Conduct and
applicable laws will be subject to disciplinary measures up to and including
termination of employment from the Company.

2.    RELATIONS WITH CUSTOMERS

It shall be part of the Company's fundamental and unswerving objectives and
policies:

      to provide customers with quality merchandise and service at fair prices;

      to deal with customers fairly, honestly and courteously;

      to attempt in good faith to ascertain and satisfy the needs of customers;
      and

      to live up to its obligations to customers and to satisfy customers'
      legitimate complaints fairly and with dispatch, forever mindful of the
      fact that a satisfied customer is one of the Company's most valued assets.


                                       3
<PAGE>
3.    STATEMENTS IN ADVERTISING

The Company's reputation for integrity is a priceless asset and the product of
continuous effort by all of us. Our promotional literature, such as catalogs and
web sites, must protect and enhance this reputation by providing complete and
unambiguous performance characterizations of our products. Advertising must
avoid deliberately misleading statements regarding our products or those of
competitors. Statements about the Company's products and comparisons with
competitive offerings shall be based on factual data.

4.    COMPETITION

The purpose of the U.S. antitrust laws is to preserve our free enterprise
system. Antitrust policy is founded on the belief that the public interest is
best served by vigorous and fair competition -- that is, competition free from
collusive agreements among competitors. The management of the Company is
committed to those philosophies. While the Company will compete aggressively and
creatively in its business activities, its efforts in the marketplace shall be
conducted in a fair and ethical manner in strict accordance with the letter and
spirit of applicable antitrust and trade practice laws.

Company employees should also be aware of the serious criminal and civil
consequences of violations of those laws. First, violation of the antitrust laws
may be prosecuted as a felony, and conviction may result in very heavy corporate
and individual fines, and substantial prison sentences. Second, court
injunctions obtained by the U.S. Department of Justice or a State Attorney
General, or orders by the Federal Trade Commission ("FTC"), may place severe
restrictions on Company operations. Violation of a court injunction is
punishable by fine or imprisonment; and violation of an FTC order can result in
substantial monetary penalties. Finally, persons injured by reason of violations
of certain of the antitrust laws may sue and recover triple the amount of their
actual damages.

The antitrust laws forbid collusion between competitors to restrain trade, as
well as attempts or conspiracies to monopolize by means of predatory or unfair
tactics; and prohibits certain restrictive arrangements with customers,
particularly those that fix resale prices, or otherwise unreasonably restrain
customers' sales or purchases of merchandise. Any agreement, mutual consent or
understanding, whether express or implied, oral or written, may be sufficient to
establish collusion. It would be flatly illegal to collude with competitors to:

-     raise, lower, maintain, stabilize or otherwise fix prices, discounts,
      allowances, credit terms or any other element of price;

-     fix the price at which merchandise will be purchased from suppliers and
      vendors or resold by customers and concessionaires;

-     limit or control production or sales;

-     allocate customers, or divide markets or marketing territories; or

-     boycott suppliers, vendors, concessionaires or customers.

Obviously, no Company employee shall participate in any such collusive
arrangement or practice with a competitor. Nor may any employee engage in any
predatory or unfair conduct designed to exclude competition; enter into, or
discuss, any arrangement with a customer to fix resale prices; or, except with
the prior approval of the Company's Executive Vice President - Human Resources &
Legal, enter into any arrangement with a customer otherwise restricting its
ability to purchase or sell merchandise. Whenever there is a question as to
whether an act or practice may violate the antitrust laws, the Executive Vice
President - Human Resources & Legal must be contacted.

It is equally important to avoid contacts and dealings with competitors that
might lead to an inference of collusion. Accordingly, no Company employee shall
discuss, or remain present while anyone else


                                       4
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discusses, with a competitor any of the above topics, including prices (past,
present or future), pricing procedures, profit levels, selection of resources,
merchandising plans or other competitive business information. If a simple
refusal to participate is not sufficient to end the discussion, a Company
employee should walk out of the meeting or gathering and promptly report the
incident to the Executive Vice President - Human Resources & Legal.

Trade associations, trade shows and similar activities are particularly
sensitive because they provide an opportunity for gatherings of competitors. The
Company will support only those trade associations and activities that perform
useful and legitimate functions in the industry. Employees should attend
activities of trade associations at which competitors are present only with the
advance approval of management. In any such attendance, Company employees must
always be cautious and wary of informal get-togethers, and avoid any discussions
of prohibited topics.

5.    PROPER ACCOUNTING AND FINANCIAL INTEGRITY

All transactions must be executed only in accordance with management's general
or specific authorization. The Company's books, records and accounts must
reflect, accurately and fairly and within the Company's regular system of
accountability, all of the Company's transactions and the acquisition and
disposition of its assets. All transactions shall be accurately recorded to
permit the preparation of financial statements in conformity with generally
accepted accounting principles consistently applied and other applicable rules,
regulations and criteria, and to insure full accountability for all assets and
activities of the Company. Under no circumstances shall there be any unrecorded
funds or assets of the Company, regardless of the purposes for which such fund
or asset may have been intended, or any improper or inaccurate entry, knowingly
made on the books and records of the Company. No payment on behalf of the
Company shall be approved or made with the intention or understanding that any
part of such payment is to be used for a purpose other than that described by
the documents supporting the payment.

All employees must cooperate fully with the Company's internal audit staff,
independent auditors and counsel to enable them to discharge their
responsibilities to the fullest extent.

6.    ACCURATE PERIODIC REPORTS

As you are aware, full, fair, accurate, timely and understandable disclosure in
our periodic reports filed with the SEC and Amex is required by SEC and Amex
rules and is essential to our continued success. Please exercise the highest
standard of care in preparing such reports in accordance with the guidelines set
forth below, including, without limitation, the following:

-     All Company accounting records, as well as reports produced from those
      records, must be kept and presented in accordance with the laws of each
      applicable jurisdiction.

-     All records must fairly and accurately reflect the transactions or
      occurrences to which they relate.

-     All records must fairly and accurately reflect in reasonable detail the
      Company's assets, liabilities, revenues and expenses.

-     The Company's accounting records must not contain any intentionally false
      or intentionally misleading entries.

-     No transaction may be intentionally misclassified as to accounts,
      departments or accounting periods.

-     All transactions must be supported by accurate documentation in reasonable
      detail and recorded in the proper account and in the proper accounting
      period.

-     No information may be concealed from the internal auditors or the
      independent auditors (or the Audit Committee or Board of Directors).


                                       5
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-     Compliance with Generally Accepted Accounting Principles and the Company's
      system of internal accounting controls is required at all times.

II.   USE OF COMPANY ASSETS, FACILITIES AND SERVICES

The use of Company assets, including proprietary information, facilities or
services for any unlawful, improper or unauthorized purposes is strictly
prohibited.

Employees shall not make any expenditures or otherwise make any commitments
affecting the Company's assets unless they have been properly authorized to do
so.

1.    IMPROPER PAYMENTS

No payments or gifts of anything of value (in money, property, discounts,
services, rebates or otherwise), regardless of form, shall be made or offered,
directly or indirectly, in the conduct of the Company's affairs:

-     to any domestic or foreign governments, agencies, officials, employees or
      agents, for purposes other than the satisfaction of lawful obligations; or

-     to any private party, involving the use of the Company's funds, assets or
      resources, except in the ordinary course of business.

Such payments or gifts, whether or not called gratuities and whether or not
expressly or impliedly in exchange for certain conduct, may be perceived to be
bribery or otherwise improper and are prohibited.

Payments to Domestic and Foreign Officials

Employees must comply with all laws prohibiting improper payments to domestic
and foreign officials, including the U.S. Foreign Corrupt Practices Act of 1977
(the "Act").

The Act prohibits an offer, payment, promise of payment or authorization of the
payment of any money or gift to a foreign official, foreign political party,
official of a foreign political party or candidate for political office to
influence any act or decision of such person or party to obtain or retain
business. The Act also prohibits a payment to any person with the intention that
all or a portion of that payment will be offered or given, directly or
indirectly, to any such political person for any such purpose. Although
so-called "grease" payments may not be illegal, the Company's policy is to avoid
such payments. If any employee finds that adherence to the Company's policy
would cause a substantial, adverse effect on operations, that fact should be
reported to the Company's Executive Vice President - Human Resources & Legal who
will determine whether an exception may lawfully be authorized. If the
facilitating payment is made, such payment must be properly entered and
identified on the books of the Company and all appropriate disclosures made.

The Act further requires compliance with generally accepted accounting
principles. The Company must continue to maintain financial records that, in
reasonable detail, accurately and fairly reflect transactions. In particular,
all bank accounts that receive or disburse funds on behalf of the Company shall
be properly authorized and any such transactions recorded on the official books
and records of the Company.

Violation of the Act is a criminal offense, subjecting the Company to
substantial fines and penalties and any officer, director, employee or
stockholder acting on behalf of the Company to imprisonment and fines. The Act
prohibits the Company from paying, directly or indirectly, a fine imposed upon
an individual pursuant to the Act.

2.    POLITICAL CONTRIBUTIONS

No contributions of Company funds, assets, services or use of facilities,
regardless of form, may be made or offered, directly or indirectly, by any
employee to any political party or any candidate for, or holder of,


                                       6
<PAGE>
political office, either domestic or foreign. Furthermore, employees shall
refrain from applying any pressure to or harassing other employees in political
matters.

The foregoing is in no way intended to prohibit or discourage employees from
making personal contributions to political candidates or parties of their choice
or to participate in the political process, purely for the employees' own
account and on their own time. The Company will not reimburse personal
contributions by employees, directly or indirectly.

3.    SAFEGUARDING ASSETS

The Company's assets must be safeguarded against inadvertent loss as well as
against intentional misappropriation. Assets include not only cash, fixtures,
furniture and equipment, but also merchandise, business and product plans, trade
secrets, information technology and records and other proprietary or
confidential information and related matters.

III.  SELECTION OF VENDORS AND SUPPLIERS OF GOODS AND SERVICES

The selection of a vendor or other supplier of goods and services to the Company
must be based on quality, need, performance and cost.

In dealing with vendors, it is the responsibility of all employees to actively
promote the best interests of the Company, within legal limits, through
aggressive attention to opportunities and the obtaining of fair terms and
treatment for the Company.

IV.   CONFLICT OF INTEREST; CORPORATE OPPORTUNITY

No employee shall, directly or indirectly, engage or participate in, or
authorize, any transactions or arrangements involving, or raising questions of,
possible conflict, whether ethical or legal, between the interests of the
Company and the personal interests of the employee or his or her family. No
employee shall take for himself or herself personally any opportunity that
arises through the use of corporate property, information or position or shall
use corporate property, information or position for personal gain.

No employee or any member of his or her family shall, directly or indirectly,
acquire or hold any beneficial interest of any kind in any firm or entity that
does, or in the recent past did, business with the Company, or in any firm or
entity which is currently or prospectively competing in any manner with the
Company. This prohibition shall not apply to the acquisition or holding of any
security through a mutual fund or of any interest not in excess of 1% of any
class of securities listed on a national securities exchange or traded in an
established over-the-counter securities market. Activities and holdings that
have the appearance of impropriety are also to be avoided.

For purposes of this policy, a member of an employee's family shall include a
spouse, parents, stepparents, in-laws, siblings, children, stepchildren and any
other person residing in the employee's residence.

No employee or any member of his or her family shall, directly or indirectly,
seek, accept or retain gifts or other personal or business favors from any
vendor, supplier or customer of the Company or from any individual or
organization seeking to do business with the Company. A personal benefit means
any type of gift, gratuity, use of facilities, favor, entertainment, service,
loan, fee or compensation or anything of monetary value. Specific exceptions to
this prohibition will be made if there is no reasonable likelihood of improper
influence in the performance of duties on the part of the employee on behalf of
the Company and if the personal benefit falls into one of the following
categories:

-     normal business courtesies, such as meals, involving no more than ordinary
      amenities;

-     paid trips or guest accommodations in connection with proper Company
      business and with the prior approval of the Chief Financial Officer or the
      Executive Vice President - Human Resources & Legal;


                                       7
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-     fees or other compensation received from any organization in which
      membership or an official position is held only if approved by the Chief
      Financial Officer or the Executive Vice President - Human Resources &
      Legal;

-     loans from financial institutions made in the ordinary course of their
      business on customary terms and at prevailing rates; or

-     gifts of nominal value (less than $200) during the holiday season.

No employee at the Vice President level or above or any member of his or her
family may compete with the Company. No employee at the Vice President level or
above or any member of his or her family may serve as a director, officer,
employee of or consultant to a competitor, vendor, supplier or other business
partner of the Company without the prior written approval of the Executive Vice
President - Human Resources & Legal.

No employee or any member of his or her family who directly or indirectly owns a
financial interest in, or has an obligation to, a competitor, supplier, customer
or other business partner of the Company, which interest or obligation is
significant to such employee or family member may conduct business with such
entity or person without the prior written approval of the Executive Vice
President - Human Resources & Legal.

No employee or any member of his or her family may act as a broker, finder or
other intermediary for his or her benefit or for the benefit of any third party
in a transaction involving the Company without the prior written approval of the
Executive Vice President - Human Resources & Legal.

Gifts or entertainment that have an aggregate value in any year in excess of
$200 are generally considered to be excessive and shall not be accepted by the
employee. This prohibition would also apply to common courtesies and
hospitalities if their scale or nature would in any way appear to affect the
impartiality of the employee or imply a conflict of interest. However, this
prohibition is not meant to preclude an employee's acceptance of business
entertainment that is not intended to influence loyalty of the employee to the
Company and, that is reasonable in nature, frequency and cost; for example, a
lunch, dinner or occasional athletic, social or cultural event, or participation
in corporate promotional events.

An employee should make every effort to refuse to accept, or to return, any gift
or gifts from a supplier, customer or other business partner exceeding $200 in
value. If the employee determines that the donor would be insulted or
embarrassed if the gift is refused or returned, a conflict can nevertheless be
avoided by promptly reporting the gift to the employee's supervisor and
delivering to the employee's supervisor the gift or a check payable to the
Company for the fair value of the gift (which the Company will donate to
charity).

V.    SECURITIES TRADING

1.    INSIDE INFORMATION

If an employee of the Company has material nonpublic (i.e., "inside")
information relating to the Company, it is our policy that neither that person
nor any related person:

-     may buy or sell securities of the Company (other than pursuant to a
      prearranged trading plan that complies with Rule 10b5-1 under the
      Securities Exchange Act of 1934, as amended, or engage in any other action
      to take advantage of that information, or

-     may pass that information on to any person outside the Company or suggest
      or otherwise recommend that any such person outside the Company buy or
      sell securities of the Company or engage in any other action to take
      advantage of that information.


                                       8
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This policy continues to apply after termination of employment to the extent
that a former employee is in possession of material nonpublic information at the
time of termination. In such case, no trading may take place until the
information becomes public or ceases to be material.

This policy also applies to information, obtained in the course of employment
with, or by serving as a director or officer of the Company, relating to any
other company, including: our customers or suppliers, any company with which we
may be negotiating a major transaction or business combination, or any company
as to which we have an indirect or direct control relationship or a designee on
the board of directors. No employee may effect transactions in the securities of
any such other company while in possession of material nonpublic information
concerning such company that was obtained in the course of employment with, or
service as a director of, the Company.

Transactions that may be necessary or justifiable for independent reasons (such
as the need to raise money for an emergency expenditure) are no exception. Even
the appearance of an improper transaction must be avoided to preserve our
reputation for adhering to the highest standards of conduct.

What is "material"? Material information has been defined as any information
that a reasonable investor would consider important in a decision to buy, hold
or sell stock. In short, any information that could reasonably affect the price
of our stock. Either positive or negative information may be material. Common
examples of information that will frequently be regarded as material are:
projections of future earnings or losses, or other guidance concerning earnings;
a pending or proposed merger, joint venture, acquisition or tender offer; a
significant sale of assets or the disposition of a subsidiary or business unit;
changes in dividend policies or the declaration of a stock split or the offering
of additional securities; changes in senior management or other key employees;
significant legal or regulatory exposure due to a pending or threatened lawsuit
or investigation; impending bankruptcy or other financial liquidity problems;
and the gain or loss of a substantial customer or supplier.

Obviously, it is sometimes most difficult to determine materiality, particularly
on a prospective basis, and the facts in each case should be carefully weighed.
Remember, if your securities transactions become the subject of scrutiny, they
will be viewed after-the-fact with the benefit of hindsight. As a result, before
engaging in any transaction, you should carefully consider how regulators and
others might view your transaction in hindsight. Whenever there is a question
concerning materiality, the employee should either refrain from trading or
consult the Executive Vice President - Human Resources & Legal.What is
"non-public"? Information should be considered non-public if it has not been
broadly disclosed to the marketplace, such as through a press release or SEC
filing, and until the marketplace has had time to absorb the information. It
should be noted that the mere existence of widespread rumors or unconfirmed
press speculation concerning the information does not mean that the information
is adequately disseminated to the public.

2.    TRADING GUIDELINES

Investment by employees of the Company in the Company's stock is generally
desirable and not to be discouraged. However, such investments should be made
with caution, and with recognition of the legal prohibitions concerning the use
by corporate "insiders" of confidential information for their own profit.
Guidelines to aid employees in determining when trading in the Company's stock
is appropriate are set forth in the Company's "Policy on Trading in Company
Securities," updated and published annually, which is incorporated herein by
reference.

You generally may not trade, without prior permission, during any period which
the Executive Vice President - Human Resources & Legal has designated as a
blackout period for the Company, whether or not you possess any material inside
information about the Company. While the reasons for a blackout period will
generally not be given, the Executive Vice President - Human Resources & Legal
will attempt to limit such restrictions to those reasonably necessary in the
best interests of the Company.


                                       9
<PAGE>
You generally may trade if no limitation on trading has been declared and you do
not possess any material information about the Company that has not been
publicly disclosed. The Executive Vice President - Human Resources & Legal has
established certain "safe trading windows" during which employees may trade
Company securities.

For further guidance, please refer to the Company's "Policy on Trading in
Company Securities" and the accompanying memorandum entitled "Blackout Periods
and Safe Trading Windows Under Securities Trading Policy," updated and published
annually, which are incorporated herein by reference.

If you have any questions as to whether it is appropriate to trade in a given
circumstance, contact the Executive Vice President - Human Resources & Legal for
advice prior to trading.

3.    REPORTING AND OTHER OBLIGATIONS

Executive officers, directors and significant beneficial owners of the Company
are also subject to specific reporting and other requirements under federal and
state securities laws. The Company will endeavor to assist each affected
individual in compliance with such laws. In order for the Company to do so, it
is incumbent upon such individuals to provide information to the Company
regarding share ownership and related matters promptly, fully and accurately. In
addition, each person who is or becomes a beneficial owner of more than 10% of
any class of the Company's equity securities must comply with the reporting
requirements of Section 16 of the Securities Exchange Act of 1934, as amended.

VI.   ENVIRONMENT, HEALTH AND SAFETY

The Company is committed to environmental, health and safety protection for its
employees, customers, neighbors and others who may be affected by its products
or activities. The laws and regulations in this area are complex, and violations
can result in severe criminal and civil penalties for the Company and
responsible employees. If you are faced with an environmental, health or safety
issue, you should promptly contact the Executive Vice President - Human
Resources & Legal to discuss the matter.

VII.  EMPLOYMENT ISSUES

1.    EQUAL OPPORTUNITY

The Company affords equal opportunity for employment, including equal treatment
in hiring, promotion, training, compensation, termination and disciplinary
action, to all individuals regardless of race, color, religion, national origin,
sex, sexual preference, marital status, veteran status or physical or mental
disability. Unlawful discrimination can expose the Company to substantial
damages and unfavorable publicity. All employees are required to conduct their
business activities with due regard for this policy.

2.    HARASSMENT AND DISCRIMINATION

The Company strives to maintain an atmosphere that is free from illegal
discrimination or harassment of any kind, including discrimination or harassment
on the basis of an individual's race, color, religion, sex (including
pregnancy), age, disability, religion, marital status, sexual orientation,
national origin, veteran status, or any other characteristic protected by
federal, state or local law.

The Company has a complaint procedure that employees should follow in the event
any employee feels that he or she has been the subject of any type of unlawful
harassment, including sexual harassment, or discrimination. Any employee found
to have violated this policy will be subject to such disciplinary action, as the
Company deems appropriate, up to and including immediate termination of
employment.

Sexual Harassment

It is the Company's policy to maintain a working environment free from sexual
harassment or conduct that might reasonably be perceived as constituting sexual
harassment. Sexual harassment means any unwelcome sexual advances or requests
for sexual favors or any conduct of a sexual nature when:


                                       10
<PAGE>
-     Submission to such conduct is made either explicitly or implicitly a term
      or condition of an individual's employment;

-     Submission to or rejection of such conduct by an individual is used as the
      basis for an employment decision affecting such individual; or

-     Such conduct has the purpose or effect of substantially interfering with
      an individual's work performance or creating an intimidating, hostile or
      offensive working environment.

Although it would be impossible to list all conduct that would violate this
policy, the following are examples of conduct that the Company absolutely
prohibits:

-     Offensive comments, jokes or other sexually oriented statements or
      depictions;

-     Unwelcome sexual advances or flirtations;

-     Making unwelcome comments about a person's clothing, body, or personal
      life;

-     Unwanted hugs, touches, kisses or other physical contact;

-     Requests for sexual favors;

-     Derogatory, offensive or pornographic posters, signs, cartoons or
      drawings;

-     Transmitting, viewing or forwarding e-mails containing offensive,
      suggestive or lewd attachments, statements or jokes;

-     Uploading or downloading of inappropriate pictures or material onto
      Company computer systems; or

-     Retaliating against an employee for making a complaint or participating in
      an investigation concerning harassment or discrimination.

The above list is only illustrative of types of conduct that would violate this
policy and, as such, by no means represents an exclusive list of conduct or
types of conduct that could lead to disciplinary action, up to and including
termination of employment. Offensive and inappropriate behavior need not rise to
the level of sexual harassment within the meaning of applicable state and
federal law to be deemed a violation of this policy.

All employees must comply with this policy and take appropriate measures to
ensure that such conduct does not occur.

Individuals who engage in acts of sexual harassment may be subject to civil and
criminal penalties.

Harassment on Account of Other Protected Class Status

In addition to sexual harassment, it is a violation of the Company's policies to
engage in conduct that is harassing or disparaging of another on account of that
employee's race, color, religion, sex (including pregnancy), age, disability,
religion, marital status, sexual orientation, national origin, veteran status,
or any other characteristic protected by federal, state or local law. All
employees must comply with this policy and take appropriate measures to ensure
that such conduct does not occur. Employees who engage in such conduct will be
subject to discipline, up to and including termination, and may be subject to
civil and criminal penalties.

Discrimination


                                       11
<PAGE>
It is also a violation of the Company's policies to discriminate or to treat an
employee less favorably on account of that employee's race, color, religion, sex
(including pregnancy), age, disability, religion, marital status, sexual
orientation, national origin, veteran status, or any other characteristic
protected by federal, state or local law. All employees must comply with this
policy and take appropriate measures to ensure that such conduct does not occur.
Employees who engage in such conduct will be subject to discipline, up to and
including termination, and may be subject to civil penalties.

Complaint Procedure

Employees who believe they have been subject to conduct in violation of this
policy should report such conduct immediately to his or her supervisor, a Human
Resources representative or the senior manager of his or her unit or facility.
Similarly, an employee who witnesses conduct that violates this policy should
report it immediately to his or her supervisor or to a Human Resources
representative or the senior manager of his or her unit or facility.

If for any reason an employee is uncomfortable approaching his or her supervisor
(for example, if the supervisor is the person the employee feels is engaging in
the offensive conduct), or if the employee feels that the matter is not being
addressed adequately, he or she should promptly bring it to the attention of the
next level of management, a Human Resources representative, or another member of
management with whom the employee feels comfortable.

Supervisors or managers who receive complaints of harassment or discrimination
from an employee are required to forward them immediately to a Human Resources
representative.

The Company will promptly conduct an investigation in response to specific
reported instances of violations of this policy. Upon request, employees are
required to cooperate fully in any investigation of specific reported instances
of violations of this policy. Retaliation or reprisal against an employee who
reports an alleged violation of this policy, or who provides information in any
investigation related thereto, is strictly prohibited and shall constitute a
violation of this policy.

Although the Company cannot guarantee complete confidentiality in matters of
harassment and discrimination, it will conduct its investigation in as
confidential a manner as possible under the circumstances.

If the investigation confirms that harassment, discrimination or other conduct
in violation of this policy has occurred, the Company will take prompt and
effective action to ensure that the offending conduct or act(s) do not continue.

Any employee found to have engaged in conduct prohibited by this policy will be
subject to discipline, up to and including termination. The Company does not
consider conduct in violation of this policy to be within the course and scope
of employment or the direct consequence of the discharge of one's duties.
Accordingly, to the extent permitted by law, the Company reserves the right not
to provide a defense or pay damages assessed against employees for conduct in
violation of this policy.

3.    DRUG AND ALCOHOL ABUSE

All Company entities will abide by applicable laws and regulations relative to
the possession or use of alcohol and drugs. Company policy prohibits the illegal
use, sale, purchase, transfer or possession of drugs by employees, or the
presence in one's system of alcohol or illegal drugs, while on Company premises.

Similarly, Company policy prohibits the use, sale, purchase, transfer or
possession of alcoholic beverages by employees while on Company premises, except
as authorized by the Company.


                                       12
<PAGE>
4.    DISABILITY

The Company is required to, and does, make reasonable accommodations to the
known physical or mental limitations of a qualified employee or applicant with a
disability if, with these accommodations, the person can perform the essential
functions of the job. The Company may be excused from making a reasonable
accommodation if the accommodation would impose an "undue hardship" on the
operation of its business.

VIII. INFORMATION SYSTEM USE

This policy is meant to govern the behavior of employees, contractors, vendors,
and third party agents of the Company with regard to the Company's Information
System, including Company records, software, e-mail, voice-mail, Internet,
electronic data, confidential information and third party consultants.

1.    INFORMATION SYSTEM

The Company's Information System is comprised of:

-     All of the computer hardware, software, computer networks, telephones,
      facsimile machines, voice-mail and e-mail systems, and Internet and
      Intranet sites which the Company owns, leases or maintains; and

-     Any files or business records that are created or stored on the system.

2.    BUSINESS RECORDS & DOCUMENTATION

-     Employees must keep private those business records or other documentation
      that are not generally available to the public or that the Company
      otherwise deems confidential.

-     Employees are generally prohibited from copying or distributing software
      that is owned by a third-party and licensed to the Company.

3.    USING THE INFORMATION SYSTEM

-     Each component of the Company's Information System, including any off-site
      use, should be used for purposes of the Company's business.

-     Privacy

      1)    Employees should not have any expectation of privacy with regard to
            use of the Company's Information System, including in their
            communications, computer files or workspaces. The Company reserves
            the right to review e-mail, voice-mail, facsimile messages, Internet
            or other electronic information systems. All such observations or
            examinations will be conducted in accord with federal and state
            regulations.

      2)    Any inappropriate or unauthorized use of the Company's Information
            System may be grounds for disciplinary action, up to and including
            termination of employment.

4.    OBTAINING SECURITY ACCESS

The confidentiality and integrity of data stored on the Company's computer
systems must be protected by access controls to ensure that only authorized
employees or third parties have access. This access shall be restricted to only
those capabilities that are appropriate to perform each employee's job duties.


                                       13
<PAGE>
5.    INTERNET USE

-     As a general rule, unless Internet access is directly related to an
      employee's job duties, employees should only access the Internet with
      their supervisor's approval. Widespread Internet access by employees can
      cause a strain on the Company's computer networks.

-     All Internet usage will be monitored and recorded. Non-work related sites
      may be restricted as determined by management. Excessive/ inappropriate
      "surfing" may result in removal of Internet access.

-     Employees are prohibited from copying or downloading software from the
      Internet. Such software could contain viruses or bugs that might damage
      the Company's computer systems, and the use of such software may require a
      fee charged to the employee or the Company.

6.    RESTRICTED INFORMATION

-     Employees are strictly prohibited from attempting to access any portion of
      the Company's Information System to which he or she is ordinarily denied
      access.

-     Any use by an employee of a password assigned to another party is strictly
      prohibited and may be grounds for dismissal.

7.    PROTECTION OF COMPANY ELECTRONIC DATA AND INFORMATION
      PASSWORDS/VIRUSES/DATA SECURITY

-     Passwords

      1)    Employees should memorize their password rather than write it down.

      2)    If employees disclose their password to a co-worker or a third
            party, they should change it promptly.

      3)    If the computer network permits, employees should change their
            passwords at least every 30 days.

-     Viruses

      1)    Always run the corporate standard, supported anti-virus software.
            Check the software often to make sure the virus definitions remain
            current.

      2)    NEVER open any files or macros attached to an email from an unknown,
            suspicious or untrustworthy source. Delete these attachments
            immediately, then "double delete" them by emptying your computer's
            Trash folder.

      3)    Because of virus exploits of email systems, you should be wary of
            any unexpected attachments from known and trustworthy sources as
            well. Contact the sender for verification before opening the file.

      4)    Never download files from unknown or suspicious sources. All
            downloaded files should be scanned with virus software prior to
            being opened or run.

-     Disks with confidential information should be kept in a secure place. They
      should not be left where they can be exposed to magnets or where beverages
      or other liquids can spill on them.

-     All PCs, laptops, and workstations should be secured with a
      password-protected screensaver with the automatic activation feature set
      at 10 minutes or less, or by logging-off when the host will be unattended.

-     Employees may not accept, use or share programs or data from unauthorized
      sources.


                                       14
<PAGE>
8.    NON-STANDARD SOFTWARE

-     Employees should refrain from installing any non-standard software on
      their PCs without permission of I.T. Network Management.

9.    REMOTE ACCESS

Remote access policy applies to all Company employees, contractors, vendors, and
agents with a Company-owned or personally-owned computer or workstations used to
connect to the Company network. It also applies to remote access connections
used to do work on behalf of the Company, including reading or sending email and
viewing the intranet web resources.

-     It is the responsibility of each individual with remote access privileges
      to ensure that their remote access connection is given the same
      consideration as the user's on-site connection.

-     At no time should login or password information be supplied to
      non-authorized users, not even family members. The authorized individual
      is responsible to ensure that non-authorized users do not violate any
      Company policies, do not perform illegal activities, and do not use the
      access for outside business interests.

-     All hosts connected to Company internal networks via remote access must
      use the most up-to-date anti-virus software. This includes personal
      computers.

-     The individual bears responsibility for any consequences should remote
      access be misused.

-     Remote access must be requested via the Help Desk following the procedures
      in the Obtaining Security Access section.

-     Remote access accounts will be monitored. If an account is not used for a
      period of six months, the account will expire and will no longer function.
      If remote access is subsequently required, the individual must request a
      new account as described above.

10.   UNACCEPTABLE ACTIVITIES

The following activities are strictly prohibited:

-     Introduction of malicious programs into the network or server (e.g.
      viruses, worms, trojan horses, e-mail bombs, etc.).

-     Effecting security breaches or disruptions of network communication.
      Security breaches include, but are not limited to, accessing data of which
      the employee is not an intended recipient or logging into a server or
      account that the employee is not expressly authorized to access, unless
      these duties are within the scope of regular duties. Disruption includes,
      but is not limited to, network sniffing, pinged floods, packet spoofing,
      denial of service, and forged routing information for malicious purposes.

-     Port scanning or security/password scanning is expressly prohibited unless
      prior approval is received from the Security Manager.

-     Executing any type of network monitoring which will intercept data not
      intended for the employee's host, unless this activity is part of the
      employee's normal job/duty and approved by the Security Manager.

-     Circumventing user authentication or security of any host, network, or
      account.


                                       15
<PAGE>
-     Using any program/script/command, or sending messages of any kind, with
      the intent to interfere with, or disable, a user's terminal session, via
      any means, locally or via the

11.   REPORTING SECURITY PROBLEMS

-     If sensitive Company information is lost, disclosed to unauthorized
      parties, or suspected of being lost or disclosed to unauthorized parties,
      the Security Manager must be notified immediately.

-     If any unauthorized use of the Company's information systems has taken
      place, or is suspected of taking place, whenever passwords or other system
      access control mechanisms are lost, stolen, or disclosed, or are suspected
      of being lost, stolen, or disclosed, the Security Manager must be notified
      immediately.

-     Because it may indicate a computer virus infection or similar security
      problem, all unusual systems behavior, such as missing files, frequent
      system crashes, misrouted messages, and the like must also be immediately
      reported. The specifics of security problems should not be discussed
      widely but should instead be shared on a need-to-know basis.

-     Employees must not "test the doors" (probe) security mechanisms unless
      they have first obtained permission from the Security Manager. If users
      probe security mechanisms, alarms will be triggered and resources will
      needlessly be spent tracking the activity.

IX.   CONFIDENTIAL INFORMATION

Safeguarding the confidential nature of information concerning the Company, its
present and prospective business, and its customers, suppliers and investors is
essential to the successful conduct of its business.

Confidential information is any non-public information or materials, whether in
verbal, paper, or electronic form, such as materials describing or relating to
computer software or systems, business and financial affairs, personnel matters,
operating procedures, marketing matters, and policies and procedures of the
Company or its employees, customers, vendors or other third parties.

Confidential information includes, but is not limited to, vendors, suppliers,
mailing lists and other customer information including credit or charge card
numbers, price and mark-up determinations, sales or sales trends of catalogs,
advertisements or particular items, cost of products or services paid by the
Company, budgets, and business and marketing plans. It includes any data that
could be used to infer information about the business activities of the Company
and its customers.

All information developed within the Company with respect to its business is
confidential and should not be disclosed to any person who is not a Company
employee. Nor should confidential information be left out in the open,
carelessly discarded or discussed in public (e.g., in an elevator where
unauthorized persons may have access to it).

All external communications intended for the general public, the financial
community or the press must be approved in writing by the Company's Chief
Executive Officer or the Executive Vice President - Human Resources & Legal in
advance.

No employee may use any confidential information relating to the Company,
regardless of the source of such information or the method of its acquisition,
for the purpose of furthering any private interest or as a means of realizing
any personal gain, directly or indirectly.

-     Confidential information will only be made available to employees if it is
      needed to perform their job responsibilities.

-     Employees must refrain from publicizing, disclosing, or allowing
      disclosure of any Company information without prior written authorization
      from the appropriate supervisor.


                                       16
<PAGE>
-     In order to safeguard the Company's confidential electronic data and
      information, employees should:

      1)    NOT discuss the affairs of the Company with or in the presence or
            persons (including other Company employees) who do not have a need
            to know the information.

      2)    Safeguard confidential material whether in the office or at home,
            and dispose of material with special care.

      3)    Control access to confidential systems and data.

X.    DUTY TO RETURN CONFIDENTIAL INFORMATION AND COMPANY PROPERTY UPON
      SEPARATION FROM THE COMPANY

Upon separation from the Company for any reason, employees and directors must
immediately deliver to the Company (and must not keep in their possession,
recreate, copy or deliver to anyone else) all Confidential Information and other
documents, materials, information or any other Company property developed in
part or in whole by the employee or director or otherwise belonging to the
Company, including but not limited to paper and electronic files, customer
lists, pricing lists, marketing materials, financial materials (including but
not limited to budgets, forecasts, projections, capital expenditure requests and
projects, and contingency plans), computer equipment, technology hardware and/or
software plans, software, ID badges, cell phones, company credit cards, beepers,
keys and key cards.

The duty of employees and directors to deliver to the Company all Confidential
Information and all other Company property upon separation from the Company is
absolute and is not contingent in any manner upon any verbal or written request
for the delivery of such material by the Company at the time of separation. The
Company's right to these materials is absolute and no one other than the Board
of Directors has the authority to waive this right and any such waiver must be
in writing.

XI.   INTERNAL COMMUNICATION AND ENFORCEMENT OF POLICY

Communication of the policies contained in this Code of Conduct will be made to
all employees of the Company who will be required to sign the attached
Acknowledgement of Receipt and Understanding at least annually.

It is important that each employee comply not only with the letter but, equally
importantly, the spirit of these policies. If you believe that one of the
Company's employees is acting in a manner that is not in compliance with this
policy, or that you have been requested to so act in such a manner, you should
immediately bring this matter to the attention of the Executive Vice President -
Human Resources & Legal or your supervisor or as set for in Section XV. In order
to encourage uninhibited communication of such matters, such communications will
be treated confidentially to the fullest extent possible and no disciplinary or
other retaliatory action will be taken against an employee who communicates such
matters.

XII.  REPORTING OF ANY ILLEGAL OR UNETHICAL BEHAVIOR

We have a strong commitment to conduct our business in a lawful and ethical
manner. Employees are encouraged to talk to supervisors, managers or other
appropriate personnel when in doubt about the best course of action in a
particular situation and to report violations of laws, rules, regulations or
this Code of Conduct. We prohibit retaliatory action against any employee who,
in good faith, reports a possible violation. It is unacceptable to file a report
knowing it to be false.

The Sarbanes-Oxley Act (the "Act") requires all publicly traded companies to
establish procedures for the receipt and treatment of complaints regarding
accounting, internal accounting controls or auditing matters. The Act also
requires employees to confidentially and anonymously report concerns regarding
questionable accounting or auditing matters. This includes any circumstances
where it is believed that fraud or other irregularities may be occurring within
the Company.


                                       17
<PAGE>
Any persons wishing to report such accounting issues can be assured the
situation will be handled with the highest level of anonymity and
confidentiality. In addition, there is a high level of protection granted under
the Act to persons reporting incidents. The Act states that the Company may not
discharge, harass or in any manner discriminate against any individual providing
information.

We encourage anyone with information regarding these matters to contact the
Internal Audit Director or the Chairman of the Company's Audit Committee, and
have established the confidential Employee Fraud Hotline to facilitate
communication. If you wish to provide information anonymously, please mail it in
a sealed envelope [addressed to "Audit Committee - Complaints" and place it in a
second envelope] addressed to the Internal Audit Director or the Chairman of the
Company's Audit Committee or leave a voice-mail at 1-800-429-1577.

XIII. AMENDMENTS TO AND WAIVERS OF THE CODE OF CONDUCT

Any amendment to and waiver of this Code of Conduct for executive officers or
directors will be made only by the Board of Directors and notified in writing
and will be promptly disclosed as required by law or stock exchange regulation.

XIV.  COMPLIANCE PROCEDURES

This Code cannot, and is not intended to, address all of the situations you may
encounter. There will be occasions where you are confronted by circumstances not
covered by policy or procedure and where you must make a judgment as to the
appropriate course of action. In those circumstances we encourage you to use
your common sense, and to contact your supervisor, manager or a member of human
resources for guidance.

If you do not feel comfortable discussing the matter with your supervisor,
manager or human resources, please call the Company's ombudsman who is Director
of Internal Audit or Chairman of the Audit Committee. The ombudsman provides
information, advice and suggestions regarding the topics addressed in this Code
of Conduct. We strive to ensure that all questions or concerns are handled
fairly, discreetly and thoroughly. You need not identify yourself.

XV.   INTERPRETATION OF CODE OF CONDUCT AND EFFECTS OF FAILURE TO COMPLY

Any questions regarding this Code of Conduct or its application should be
discussed with the Executive Vice President - Human Resources & Legal.

Conduct violative of this Code of Conduct is expressly outside the employee's
scope of employment. Any employee whose conduct violates this Code of Conduct
will be subject to disciplinary action by the Company, including, in the
Company's discretion, discharge and/or forfeiture of any benefits or rights
(including contractual rights) which, under applicable law, are forfeitable upon
discharge for cause, and to the enforcement of such other remedies as the
Company may have under applicable law.

The summaries of laws and regulations contained in this policy are brief and
necessarily omit many subtleties and variations that exist in such laws and
regulations, as well as many other laws and regulations that may impose
requirements upon the Company and its employees depending upon applicable
circumstances from time to time. In addition, the laws and regulations that
affect the Company may be supplemented, amended or repealed from time to time.
Therefore, you should request prior advice from Company legal counsel in case of
any question or uncertainty concerning the impact of applicable laws and
regulations upon your business activities.

XVI.  STATEMENT NOT A CONTRACT OF EMPLOYMENT

This statement sets forth a code of conduct to which employees are expected to
adhere. It is not a contract of employment and the Company retains all of its
rights in connection with the employment, discipline and/or termination of its
employees.


                                       18
<PAGE>
                              DIRECTOR'S STATEMENT

The Company is committed to maintaining the highest standards of personal and
professional conduct in the performance of its business activities. The
publication of this Code of Conduct is intended to reaffirm and formalize the
Company's established policies and to provide employees of the Company with
appropriate guidelines to help assure their understanding and compliance. The
Company and its affiliates have maintained a tradition of sound business
practices of which we are proud. We pledge to continue this tradition in a
manner that is in keeping with both the letter and spirit of the law and the
highest ethical standards.

THOMAS C. SHULL

For the Board of Directors of Hanover Direct, Inc.


XVII. NAMES AND NUMBERS

<TABLE>
<S>                                                                             <C>
     Chairman/President/Chief Executive Officer
     Thomas C. Shull............................................................(201) 272-3106

     Executive Vice President /Chief Financial Officer
     Edward M. Lambert..........................................................(201) 272-3325

     Executive Vice President/ Human Resources & Legal
     Brian C. Harriss...........................................................(201) 272-3224
</TABLE>


                                       19
<PAGE>
                  Acknowledgement of Receipt and Understanding
                            of Hanover Direct, Inc.'s
                            Corporate Code of Conduct

I hereby acknowledge that I have been provided with Hanover Direct, Inc.'s
Corporate Code of Conduct. I further acknowledge that I have read the Code of
Conduct in its entirety and that I understand it. I agree to observe the
policies and procedures contained in the Code of Conduct and have been advised
that, if I have any questions or concerns related to such policies and
procedures, I should discuss them with my supervisor or the Human Resources
Department. I understand that failing to abide by Hanover Direct, Inc.'s Code of
Conduct could lead to disciplinary action up to and including termination of
employment. I also understand that no one other than the Board of Directors has
the authority to waive any provision of this Code of Conduct and that any waiver
must be in writing.

My signature below indicates my understanding of Hanover Direct, Inc.'s Code of
Conduct and my agreement to abide by the policies and procedures contained
therein.

--------------------------------            --------------------------------
Employee Signature                                        Date



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