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                                                                    EXHIBIT 10.7

                                                 As amended through May 27, 1999



                           BJ'S WHOLESALE CLUB, INC.
                        1997 DIRECTOR STOCK OPTION PLAN

1.   PURPOSE

     The purpose of this 1997 Director Stock Option Plan (the "Plan") of BJ's
Wholesale Club, Inc. (the "Company") is to encourage ownership in the Company by
non-employee directors of the Company whose continued services are considered
essential to the Company's future progress and to provide them with a further
incentive to remain as directors of the Company.

2.   ADMINISTRATION

     The Board of Directors shall supervise and administer the Plan.  Grants of
stock options under the Plan and the amount and nature of the awards to be
granted shall be automatic in accordance with Section 5.  However, all questions
of interpretation of the Plan or of any options issued under it shall be
determined by the Board of Directors and such determination shall be final and
binding upon all persons having an interest in the Plan.  The Board of Directors
may, to the full extent permitted by or consistent with applicable laws or
regulations, delegate any or all of its powers under the Plan to a committee
appointed by the Board of Directors, and if a committee is so appointed, all
references to the Board of Directors in the Plan shall mean and relate to such
committee.

3.   PARTICIPATION IN THE PLAN

     Directors of the Company who are not employees of the Company or any
subsidiary of the Company shall be eligible to participate in the Plan.

4.   STOCK SUBJECT TO THE PLAN

     (a) The maximum number of shares which may be issued under the Plan shall
be 150,000 shares of the Company's Common Stock, par value $0.01 per share
("Common Stock"), subject to adjustment as provided in Section 8 of the Plan.

     (b) If any outstanding option under the Plan for any reason expires or is
terminated without having been exercised in full, the shares allocable to the
unexercised portion of such option shall again become available for grant
pursuant to the Plan.

     (c) All options granted under the Plan shall be non-statutory options not
entitled to special tax treatment under Section 422 of the Internal Revenue Code
of 1986, as amended to date and as it may be amended from time to time (the
"Code").

     (d) Shares issued under the Plan may consist in whole or in part of
authorized but unissued shares or treasury shares.
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5.   TERMS, CONDITIONS AND FORM OF OPTIONS

     Each option granted under the Plan shall be evidenced by a written
agreement in such form as the Board of Directors shall from time to time
approve, which agreements shall comply with and be subject to the following
terms and conditions:

     (a) Option Grant Dates and Number of Options.
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         (1)  Annual Grants.  Upon the date of each annual meeting of the
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stockholders of the Company held after the Distribution Date (as defined in
Section 6(a)), the Company shall grant (i) to each eligible director elected as
a director for the first time at such meeting (other than persons who were
directors of Waban Inc. immediately prior to the Distribution Date) an option
for 5,000 shares of Common Stock and (ii) to each other eligible director
continuing in office after, or elected at, such meeting (including, without
limitation, any directors of Waban Inc. who became directors of the Company on
or prior to the Distribution Date) an option for 2,500 shares of Common Stock.
For purposes of this paragraph, and subject to the parenthetical in clause (i)
in the previous sentence, each eligible director initially elected (other than
at an annual meeting of stockholders or within six months after an annual
meeting of stockholders) shall be deemed to have been elected as a director for
the first time at the next annual meeting of stockholders following his or her
election as a director (provided such person is serving as a director on the
date of such annual meeting).  The Company shall grant to each eligible director
first elected as a director within six months after an annual meeting of
stockholders an option for 5,000 shares of Common Stock, effective upon such
election.

         (2)  Replacement Options.
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              (A)  General.  Following the Distribution Date, the Company will
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grant options under the Plan in replacement or adjustment of options previously
granted under the Waban Inc. 1995 Director Stock Option Plan (the "Waban Plan").
Except as provided below, the vesting schedule and other terms of such options
shall be substantially similar to those of the applicable Waban option. For
purposes of this section, the term "Stock Value Ratio" means the number
determined by dividing the Waban Common Stock Value by the BJI Common Stock
Value, where (i) the "Waban Common Stock Value" equals the average of the
closing prices of Waban Common Stock on the NYSE during the ten trading days
immediately preceding the Distribution Date and (ii) the "BJI Common Stock
Value" equals the average of the closing prices of BJI Common Stock on the NYSE
during the ten trading days immediately following the Distribution Date.

              (B)  For Eligible Directors of BJI Who Will Not Be Waban
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Directors. The Company shall grant a replacement option to each eligible
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director who is no longer serving as a director of Waban immediately after the
Distribution Date, upon the cancellation, forfeiture or other expiration of each
unexercised option under the Waban Plan held by such eligible director. Each
such replacement option shall (i) be for the number of shares of Common Stock
determined by multiplying the number of shares of Waban Common Stock subject to
the

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applicable Waban option by the Stock Value Ratio (rounded down to the nearest
whole share) and (ii) have an exercise price determined by dividing the per
share exercise price of the applicable Waban option by the Stock Value Ratio
(rounded up to the next higher cent).

              (C)  For Eligible Directors of BJI Who Will Also Be Waban
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Directors. The Company shall grant an adjustment option to each eligible
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director who is continuing to serve as a director of Waban immediately after the
Distribution Date. Such adjustment option shall (i) be for the same aggregate
number of shares of Common Stock as the unexercised portion of the applicable
Waban option and (ii) have an exercise price determined by dividing the per
share exercise price of the applicable Waban option by the Stock Value Ratio
(rounded up to the next higher cent).

     (b) Option Exercise Price.  Except as set forth in Section 5(a)(2) with
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respect to replacement options, the option exercise price per share for each
option granted under the Plan shall equal the closing sale price per share of
the Common Stock on the New York Stock Exchange on the date of grant (or if no
such price is reported on such date such price as reported on the nearest
preceding day) as reported in The Wall Street Journal (Eastern Edition).  If the
Common Stock is instead listed on another nationally recognized securities
exchange on the date of grant, the option exercise price per share for each
option granted under the Plan shall equal the reported closing sale price per
share of the Common Stock by such exchange on the date of grant or if the Common
Stock is traded on the Nasdaq National Market or another automated quotation
system, the last reported sale price per share of the Company's Common Stock on
such system on the date of grant (or if no such price is reported on such date,
such price as reported on the nearest preceding day) as reported in The Wall
Street Journal (Eastern Edition).  If the Common Stock is not listed on an
exchange or reported in an automated quotation system, the fair market value per
share on the date of grant shall be determined by the Board of Directors.

     (c) Transferability of Options.  Except as the Board may otherwise
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determine or provide in an option granted under the Plan, options shall not be
sold, assigned, transferred, pledged or otherwise encumbered by the person to
whom they are granted, either voluntarily or by operation of law, except by will
or the laws of descent and distribution, and, during the life of the
Participant, shall be exercisable only by the Participant.  References to a
Participant, to the extent relevant in the context, shall include references to
authorized transferees.

     (d) Exercise Period.  Except as set forth in Section 5(a)(2) with respect
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to replacement options, each option shall become exercisable on a cumulative
basis as to one-third of the shares subject to the option on each of the first
day of the month of the first three anniversaries of the date of grant of such
option.  In the event an optionee ceases to serve as a director, each such
option may be exercised by the optionee (or, in the event of the optionee's
death, by the optionee's administrator, executor or heirs), at any time within
12 months after the optionee ceases to serve as a director, to the extent such
option was exercisable at the time of such cessation of service.
Notwithstanding the foregoing, no option shall be exercisable after the
expiration of ten years from the date of grant.

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     (e) Exercise Procedure.  Options may be exercised only by written notice to
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the Company at its principal office accompanied by (i) payment in cash or by
certified or bank check of the full consideration for the shares as to which
they are exercised, (ii) delivery of outstanding shares of the Company's Common
Stock (which, in the case of shares acquired from the Company, have been
outstanding for at least six months) having a fair market value on the last
business day preceding the date of exercise equal to the option exercise price,
or (iii) an irrevocable undertaking by a broker (who is a member of the New York
Stock Exchange) to deliver promptly to the Company sufficient funds to pay the
exercise price or delivery of irrevocable instructions to a broker (who is a
member of the New York Stock Exchange) to deliver promptly to the Company cash
or a check sufficient to pay the exercise price.

6.   EFFECTIVE DATE AND TERMINATION

     (a) The effective date of the Plan is the date on which Waban Inc.
distributes to its stockholders, on a pro-rata basis, all of the then
outstanding shares of common stock of the Company (the "Distribution Date").

     (b) Unless sooner terminated in accordance with its terms, the Plan shall
terminate on the day following the date of the Company's annual meeting of
stockholders for the year 2002.  Options outstanding on such date shall continue
to have force and effect in accordance with the provisions of the instruments
evidencing such options.

7.  LIMITATION OF RIGHTS

     (a) No Right to Continue as a Director.  Neither the Plan, nor the granting
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of an option nor any other action taken pursuant to the Plan, shall constitute
or be evidence of any agreement or understanding, express or implied, that the
Company will retain a director for any period of time.

     (b) No Stockholders' Rights for Options.  An optionee shall have no rights
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as a stockholder with respect to the shares covered by such optionee's options
until the date of the issuance to such optionee of a stock certificate therefor,
and no adjustment will be made for dividends or other rights (except as provided
in Section 8) for which the record date is prior to the date such certificate is
issued.

     (c) Compliance with Securities Laws.  Each option shall be subject to the
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requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification of the shares subject to such option
upon any securities exchange or under any state or federal law, or the consent
or approval of any governmental or regulatory body, or the disclosure of non-
public information or the satisfaction of any other condition is necessary as a
condition of, or in connection with, the issuance or purchase of shares
thereunder, such option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, or satisfaction of
such condition shall have been effected or obtained on conditions acceptable to
the Board of Directors. Nothing herein shall be deemed to

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require the Company to apply for or to obtain such listing, registration or
qualification, or to satisfy such condition.

8.   CHANGES IN COMMON STOCK

     (a) Subject to paragraph (b) below, if the outstanding shares of Common
Stock are increased, decreased or exchanged for a different number or kind of
shares or other securities, or if additional shares or new or different shares
or other securities are distributed with respect to such shares of Common Stock
or other securities, through merger, consolidation, sale of all or substantially
all of the assets of the Company, reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or other
distribution with respect to such shares of Common Stock, or other securities,
an appropriate and proportionate adjustment will be made in (i) the maximum
number and kind of shares reserved for issuance under the Plan, (ii) the number
and kind of shares or other securities subject to then outstanding options under
the Plan, and (iii) the price for each share subject to any then outstanding
options under the Plan, without changing the aggregate purchase price as to
which such options remain exercisable.  No fractional shares will be issued
under the Plan on account of any such adjustments.

     (b) In the event that the Company is merged or consolidated into or with
another corporation (in which consolidation or merger the stockholders of the
Company receive distributions of cash or securities of another issuer as a
result thereof), or in the event that all or substantially all of the assets of
the Company are acquired by any other person or entity, or in the event of a
reorganization or liquidation of the Company, all unexercised options will
become exercisable in full beginning 20 days prior to the consummation of such
merger, consolidation, acquisition, reorganization or liquidation and, to the
extent not exercised, shall terminate effective immediately after the
consummation of such merger, consolidation, acquisition, reorganization or
liquidation.

9.   AMENDMENT OF THE PLAN

     The Board of Directors may suspend or discontinue the Plan or amend it in
any respect whatsoever; provided, however, that without approval of the
stockholders of the Company no revision or amendment shall change the number of
shares subject to the Plan (except as provided in Section 8).

10.  NOTICE

     Any written notice to the Company required by any of the provisions of the
Plan shall be addressed to the Treasurer of the Company and shall become
effective when it is received.

11.  GOVERNING LAW

     The Plan and all determinations made and actions taken pursuant hereto
shall be governed by the internal laws of the Commonwealth of Massachusetts
(without regard to any applicable conflicts of law).

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