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                                                                    Exhibit 10.1
                                                                    ------------

               THE 1988 FILENE'S BASEMENT CORP. STOCK OPTION PLAN
                          (As Amended October 3, 1996)

1. PURPOSE
   -------

   The purpose of the 1988 Filene's Basement Corp. Stock Option Plan (the
("Plan") is to advance the interests of Filene's Basement Corp. (the "Company")
by enhancing the ability of the Company (a) to attract and retain employees who
are in a position to make significant contributions to the success of the
Company; (b) to reward employees for such contributions; and (c) to encourage
employees to take into account the long-term interests of the Company through
ownership of shares of the Company's common stock (the "Stock").

   Options granted pursuant to the Plan may be incentive stock options as
defined in section 422 of the Internal Revenue Code of 1986 (as from time to
time amended, the "Code") (any option that is intended so to qualify as an
incentive stock option being referred to herein as an "incentive option"), or
options that are not incentive options, or both.

2. ADMINISTRATION
   --------------

   The Plan shall be administered by the Board of Directors (the "Board") of the
Company. The Board shall have authority, not inconsistent with the express
provisions of the Plan, (a) to grant options to such eligible employees as the
Board may select; (b) to determine the time or times when options shall be
granted and the number of shares of Stock subject to each option; (c) to
determine which options are, and which options are not, incentive options; (d)
to determine the terms and conditions of each option; (e) to prescribe the form
or forms of instruments evidencing options and any other instruments required
under the Plan and to change such forms from time to time; (f) to adopt, amend
and rescind rules and regulations for the administration of the Plan; and (g) to
interpret the Plan and to decide any questions and settle all controversies and
disputes that may arise in connection with the Plan. Such determinations of the
Board shall be conclusive and shall bind all parties. Subject to Section 8 the
Board shall also have the authority, both generally and in particular instances,
to waive compliance by an employee with any obligation to be performed by him
under an option and to waive any condition or provision of an option, except
that the Board may not, in the case of an incentive option, other than in
accordance with Section 4(c), (i) increase the total number of shares covered by
the option, (ii) extend the term of the option to more than ten years (five
years, in the case of an incentive option granted to a "ten-percent shareholder"
as defined in


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section 6(b) below), or (iii) unless the optionee consents, reduce the option
exercise price per share or otherwise cause a modification, extension or renewal
(within the meaning of section 424(h) of the Code) of the option.

   The Board may, in its discretion, delegate its powers with respect to the
Plan to a committee (the "Committee"), in which event all references to the
Board hereunder shall be deemed to refer to the Committee. The Committee shall
consist of at least two directors. A majority of the members of the Committee
shall constitute a quorum, and all determinations of the Committee shall be made
by a majority of its members. Any determination of the Committee under the Plan
may be made without notice or meeting of the Committee by a writing signed by a
majority of the Committee members. Following registration of the Stock under the
Securities Exchange Act of 1934, the Committee shall consist of the minimum
number of directors required under Rule 16b-3 under the Act, all of whom shall
be "disinterested persons" within the meaning of that Rule.

3. EFFECTIVE DATE AND TERM OF PLAN
   -------------------------------

   The Plan shall become effective on the date on which the Plan is approved by
the shareholders of the Company. Grants of options under the Plan may be made
prior to that date (but after Board adoption of the Plan), subject to approval
of the Plan by such shareholders.

   No option shall be granted under the Plan after the completion of ten years
from the date on which the Plan was adopted by the Board, but options previously
granted may extend beyond that date.

4. SHARES SUBJECT TO THE PLAN
   --------------------------

   (a) NUMBER OF SHARES. Subject to adjustment as provided in section 4(c), the
aggregate number of shares of Stock that may be delivered upon the exercise of
options granted under the Plan shall be 2,106,786. (1) If any option granted 
under the Plan terminates without having been exercised in full, the number 
of shares of Stock as to which such option was not exercised shall be available
for future grants within the limits set forth in this Section 4(a).

   (b) SHARES TO BE DELIVERED. Shares delivered under the Plan shall be
authorized but unissued Stock or, if the Board so decides in its sole
discretion, previously issued Stock acquired by the Company and held in
treasury. No fractional shares of Stock shall be delivered under the Plan.

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(1) Reflects stock splits through April 1991. 

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   (c) CHANGES IN STOCK. In the event of a stock dividend, stock split or
combination of shares, recapitalization or other change in the Company's capital
stock, the number and kind of shares of stock or securities of the Company
subject to options then outstanding or subsequently granted under the Plan, the
maximum number of shares or securities that may be delivered under the Plan, the
exercise price, and other relevant provisions shall be appropriately adjusted by
the Board, whose determination shall be binding on all persons.

   The Board may also adjust the number of shares subject to outstanding
options, the exercise price of outstanding options and the terms of outstanding
options, to take into consideration material changes in accounting practices or
principles, consolidations or mergers (except those described in Section 6(i)),
acquisitions or dispositions of stock or property or any other event if it is
determined by the Board that such adjustment is appropriate to avoid distortion
in the operation of the Plan, provided that no such adjustment shall be made in
the case of an incentive option if it would constitute a modification, extension
or renewal of the option within the meaning of section 424(h) of the Code.

5. ELIGIBILITY FOR OPTIONS
   -----------------------

   Employees eligible to receive options under the Plan shall be those employees
of the Company and its subsidiaries who, in the opinion of the Board, are in a
position to make a significant contribution to the success of the Company or
such subsidiaries. A subsidiary for purposes of the Plan shall be a corporation
in which the Company owns, directly or indirectly, stock possessing 50% or more
of the total combined voting power of all classes of stock.

   Directors who are not employees shall not be eligible to participate in the
Plan. Incentive options shall be granted only to "employees" as defined in the
provisions of the Code or regulations thereunder applicable to incentive stock
options. Receipt of options under the Plan or of awards under any other employee
benefit plan of the Company or any of its subsidiaries shall not preclude an
employee from receiving options or additional options under the Plan.

6. TERMS AND CONDITIONS OF OPTIONS
   -------------------------------

   (a) SPECIAL RULE FOR INCENTIVE OPTIONS. Consistent with section 422 of the
Code and any associated regulations, notices or other official pronouncements of
general applicability, to the extent the aggregate fair market value (determined
as of the time the option is granted) of the shares of Stock with respect to
which incentive options are exercisable for the first time by the

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optionee during any calendar year (under all plans of his employer corporation
and its parent and subsidiary corporations) exceeds $100,000, such options shall
not be treated as incentive options. Nothing in this special rule shall be
construed as limiting the exercisability of any option, unless the Board
expressly provides for such a limitation at time of grant.

   (b) EXERCISE PRICE. The exercise price of each option shall be determined by
the Board but shall not be less, in the case of an incentive option, than 100%
(110%, in the case of an incentive option granted to a ten-percent shareholder)
of the fair market value per share of the Stock at the time the option is
granted, nor less than 50% of such fair market value in the case of an option
other than an incentive option; nor shall the exercise price be less, in the
case of an original issue of authorized stock, than par value per share. For
this purpose, "fair market value" in the case of incentive options shall have
the same meaning as it does in the provisions of the Code and the regulations
thereunder applicable to incentive options; and "ten-percent shareholder" shall
mean any employee who at the time of grant owns directly, or is deemed to own by
reason of the attribution rules set forth in section 424(d) of the Code, stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or of any of its parent or subsidiary corporations.

   (c) DURATION OF OPTIONS. An option shall be exercisable during such period or
periods as the Board may specify. The latest date on which an option may be
exercised (the "Final Exercise Date") shall be the date which is ten years (five
years, in the case of an incentive option granted to a "ten-percent shareholder"
as defined in (b) above) from the date the option was granted or such earlier
date as may be specified by the Board at the time the option is granted.

   (d) Exercise of Options.
       -------------------

   (1) Unless the Board at the time of grant otherwise specifies in the case of
       a particular option or options, each option shall become exercisable in
       the following installments, which shall be cumulative:

       (a) Beginning with the second anniversary of the date of grant of the
           option, the option will be exercisable as to 25% of the shares.

       (b) Upon each of the third, fourth and fifth anniversaries of the date of
           grant, the option will be exercisable for an additional 25% of the
           shares.

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       In the case of an option not immediately exercisable in full, the Board
       may at any time accelerate the time at which all or any part of the
       option may be exercised.

   (2) The award forms or other instruments evidencing incentive options shall
       contain such provisions relating to exercise and other matters as are
       required of incentive options under the applicable provisions of the Code
       and the regulations thereunder, as from time to time in effect.

   (3) Any exercise of an option shall be in writing, signed by the proper
       person and delivered or mailed to the Company, accompanied by (a) the
       option certificate and any other documents required by the Board and (b)
       payment in full for the number of shares for which the option is
       exercised.

   (4) In the case of an option that is not an incentive option, the Board shall
       have the right to require that the individual exercising the option remit
       to the Company an amount sufficient to satisfy any federal, state, or
       local withholding tax requirements (or make other arrangements
       satisfactory to the Company with regard to such taxes) prior to the
       delivery of any Stock pursuant to the exercise of the option. In the case
       of an incentive option, if at the time the option is exercised the Board
       determines that under applicable law and regulations the Company could be
       liable for the withholding of any federal or state tax with respect to a
       disposition of the Stock received upon exercise, the Board may require as
       a condition of exercise that the individual exercising the option agree
       (i) to inform the Company promptly of any disposition (within the meaning
       of section 424(c) of the Code and the regulations thereunder) of Stock
       received upon exercise, and (ii) to give such security as the Board deems
       adequate to meet the potential liability of the Company for the
       withholding of tax, and to augment such security from time to time in any
       amount reasonably deemed necessary by the Board to preserve the adequacy
       of such security.

   (5) If an option is exercised by the executor or administrator of a deceased
       employee, or by the person or persons to whom the option has been
       transferred by the employee's will or the applicable laws of descent and
       distribution, the Company shall be under no obligation to deliver Stock
       pursuant to such exercise until the Company is satisfied as to the
       authority of the person or persons exercising the option.

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   (e) PAYMENT FOR AND DELIVERY OF STOCK. Stock purchased under the Plan shall
be paid for as follows: (i) in cash or by certified check, bank draft or money
order payable to the order of the Company or (ii) if so permitted by the Board
(not later than the time of grant, in the case of an incentive option), (A)
through the delivery of shares of Stock having a fair market value on the last
business day preceding the date of exercise equal to the purchase price or (B)
by a combination of cash and Stock as provided in clauses (i) and (ii) (A) above
or (C) by delivery of a promissory note of the option holder to the Company,
such note to be payable, in the case of an incentive option, on such terms as
are specified in the option (except that, in lieu of a stated rate of interest,
an incentive option may provide that the rate of interest on the note will be
such rate as is sufficient, at the time the note is given, to avoid the
imputation of interest under the applicable provisions of the Code), or by a
combination of cash (or cash and Stock) and the option holder's promissory note;
PROVIDED, that if the Stock delivered upon exercise of the option is an original
issue of authorized Stock, at least so much of the exercise price as represents
the par value of such Stock shall be paid in cash or by a combination of cash
and Stock.

   An option holder shall not have the rights of a shareholder with regard to
awards under the Plan except as to Stock actually received by him under the
Plan. 

   The Company shall not be obligated to deliver any shares of Stock (a) until,
in the opinion of the Company's counsel, all applicable federal and state laws
and regulations have been complied with, and (b) if the outstanding Stock is at
the time listed on any stock exchange, until the shares to be delivered have
been listed or authorized to be listed on such exchange upon official notice of
issuance, and (c) until all other legal matters in connection with the issuance
and delivery of such shares have been approved by the Company's counsel. If the
sale of Stock has not been registered under the Securities Act of 1933, as
amended, the Company may require, as a condition to exercise of the option, such
representations or agreements as counsel for the Company may consider
appropriate to avoid violation of such Act and may require that the certificates
evidencing such Stock bear an appropriate legend restricting-transfer.

   (f) NONTRANSFERABILITY OF OPTIONS. No option may be transferred other than by
will or by the laws of descent and distribution, and during an employee's
lifetime an option may be exercised only by him.

   (g) DEATH. If an employee's employment with the Company and its subsidiaries
terminates by reason of death, each option held by the employee immediately
prior to death may be exercised, 

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to the extent the option was exercisable immediately prior to death or, if
greater, to the extent of one-half the shares for which the option was granted,
by his executor or administrator, or by the person or persons to whom the option
is transferred by will or the applicable laws of descent and distribution, at
any time within the twenty-four month period beginning on the day of death
(subject, however, to the limitations of Section 6(c) regarding the maximum
exercise period for such option). Other than as provided above, upon the death
of any person granted options under this Plan all options then held by such
person shall terminate.

   (h) OTHER TERMINATION OF EMPLOYMENT. If an employee's employment with the
Company and its subsidiaries terminates for any reason other than death, all
options held by the employee that are not then exercisable shall terminate.
Options that are exercisable on the date of termination shall continue to be
exercisable for a period of thirty days (subject to Section 6(c) and the last
sentence of Section 6(g)) unless the employee was discharged for cause which in
the opinion of the Board casts such discredit on him as to justify termination
of his options. After completion of that thirty-day period such options shall
terminate to the extent not previously exercised, expired or terminated. For
purposes of this Section 6(h), employment shall not be considered terminated (i)
in the case of sick leave or other bona fide leave of absence approved for
purposes of the Plan by the Board, so long as the employee's right to
reemployment is guaranteed either by statute or by contract, or (ii) in the case
of a transfer of employment between the Company and a subsidiary or between
subsidiaries, or to the employment of a corporation (or a parent or subsidiary
corporation of such corporation) issuing or assuming an option in a transaction
to which section 424(a) of the Code applies.

   (i) MERGERS, ETC. OTHER CHANGES IN CONTROL. In the event of a consolidation
or merger in which the Company is not the surviving corporation or which results
in the acquisition of substantially all the Company's outstanding Stock by a
single person or entity or by a group of persons and/or entities acting in
concert, or in the event of the sale or transfer of substantially all the
Company's assets, all outstanding options shall thereupon terminate, provided
that each option then outstanding, to the extent not already exercisable, shall
become exercisable in full 20 days prior to the effective date of any such
merger, consolidation or sale of assets; and provided further, that if there is
a surviving or acquiring corporation, the Board shall use its best efforts to
arrange, subject to consummation of the merger, consolidation or sale of assets,
to have the surviving or acquiring corporation or an affiliate thereof grant to
employees replacement options which in the case of incentive options satisfy, in
the determination of the Board, the requirements of section 424(a) of the Code.
In the event of

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any other event which constitutes a change in control (as defined in Exhibit A)
of the Company, all outstanding options then held by an individual who has held
such options (or any other options under this Plan or any other stock option
plan of the Company) for at least one year shall become exercisable in full.

   The Board may grant options under the Plan in substitution for options held
by employees of another corporation who concurrently become employees of the
Company or a subsidiary of the Company as the result of a merger or
consolidation of the employing corporation with the Company or a subsidiary of
the Company, or as the result of the acquisition by the Company or one of its
subsidiaries of property or stock of the employing corporation. The Company may
direct that substitute awards be granted on such terms and conditions as the
Board considers appropriate in the circumstances.

   (j) RESTRICTIONS ON STOCK. The Board may provide that shares of Stock
purchased through the exercise of options under the Plan be subject to such
restrictions on resale, including restrictions requiring resale to the Company
at or below fair market value, or such other restrictions, as the Board in its
sole discretion shall determine, and shall take such steps as it deems necessary
or appropriate to carry out the purposes of any such restriction.

7. PAYMENT RIGHTS
   --------------

   Neither the adoption of the Plan nor the grant of options shall confer upon
any employee any right to continued employment with the company or any parent or
subsidiary or affect in any way the right of the Company or parent or subsidiary
to terminate the employment of an employee at any time. Except as specifically
provided by the Board in any particular case, the loss of existing or potential
profit in options granted under this Plan shall not constitute an element of
damages in the event of termination of the employment of an employee even if the
termination is in violation of an obligation of the Company to the employee by
contract or otherwise.

8. EFFECT, DISCONTINUANCE, CANCELLATION, AMENDMENT AND TERMINATION
   ---------------------------------------------------------------

   Neither adoption of the Plan nor the grant of options to an employee shall
affect the Company's right to grant to such employee options that are not
subject to the Plan, to issue to such employees Stock as a bonus or otherwise,
or to adopt other plans or arrangements under which Stock may be issued to
employees.

   The Board may at any time discontinue granting options under the plan. With
the consent of the employee, the Board may at any

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time cancel an existing option in whole or in part and grant the employee
another option for such number of shares as the Board specifies. The Board may
at any time or times amend the Plan or any outstanding option for the purpose of
satisfying the requirement of section 422 of the Code or of any changes in
applicable laws or regulations or for any other purpose which may at the time be
permitted by law, or day at any time terminate the Plan as to any further grants
of options, provided that (except to the extent expressly required or permitted
herein above) no such amendment shall, without the approval of the shareholders
of the Company, (a) increase the maximum number of shares available under the
Plan, (b) change the group of employees eligible to receive options under the
Plan, (c) reduce the price at which incentive options may be granted (d) extend
the time within which options may be granted, (e) alter the Plan in such a way
that incentive options already granted hereunder would not be considered
incentive stock options under section 422 of the Code, or (f) amend the
provisions of this Section 8, and no such amendment shall adversely affect the
rights of any employee (without his consent) under any option previously
granted.

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                                    EXHIBIT A
                                    ---------

                         Definition of Change in Control
                         -------------------------------

     "Change in Control" shall mean the occurrence of any one of the following
events:

       (a) any 'person' as such term is used in Sections 13(d) and 14(d) of the
   Securities Exchange Act of 1934, as amended (the "1934 Act") (other than (i)
   the Company, (ii) any subsidiary of the Company, (iii) any trustee or other
   fiduciary holding securities under an employee benefit plan of the Company or
   of any subsidiary of the Company, or (iv) any company owned, directly or
   indirectly, by the stockholders of the Company in substantially the same
   proportions as their ownership of stock of the Company), becomes the
   'beneficial owner' (as defined in Section 13(d) of the 1934 Act), together
   with all Affiliates and Associates (as such terms are used in Rule 12b-2 of
   the General Rules and Regulations under the 1934 Act) of such person,
   directly or indirectly, of securities of the Company representing 35% or more
   of the combined voting power of the Company's then outstanding securities;

       (b) the stockholders of the Company approve a merger or consolidation of
   the Company with any other company, other than (1) a merger or consolidation
   which would result in the voting securities of the Company outstanding
   immediately prior thereto continuing to represent (either by remaining
   outstanding or by being converted into voting securities of the surviving
   entity), in combination with the ownership of any trustee or other fiduciary
   holding securities under an employee benefit plan of the Company or any
   subsidiary of the Company, at least 65% of the combined voting securities of
   the Company or such surviving entity outstanding immediately after such
   merger or consolidation or (2) a merger or consolidation effected to
   implement a recapitalization of the Company (or similar transaction) in which
   no 'person' (with the exception given and the method of determining
   'beneficial ownership' used in clause (a) of this definition) acquires more
   than 50% of the combined voting power of the Company's then outstanding
   securities;

       (c) during any period of two consecutive years (not including any period
   prior to the execution of this Agreement), individuals who at the beginning
   of such period constitute the Board, and any new director (other than a
   director designated by a person who has entered into an agreement with the
   Company to effect a transaction described in clause (a), (b) or (d) of this
   definition) whose election

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   by the Company's stockholders was approved by a vote of at least two-thirds
   (2/3) of the directors then still in office who either were directors at the
   beginning of the period or whose election or nomination for election was
   previously so approved cease for any reason to constitute at least a majority
   thereof; or

       (d) the stockholders of the Company approve a plan of complete
   liquidation of the Company or an agreement for the sale or disposition by the
   Company of all or substantially all of the Company's assets.

In no event shall a Change in Control be deemed to have occurred if prior
thereto the Board by unanimous vote of its members present and voting, including
at least two (2) such members who are employees of the Company (whose assent
shall not be unreasonably withheld), so determine; PROVIDED, that no such
determination shall be effective after an initial public offering of the
Company's Stock. No Change in Control shall be deemed to have occurred solely by
reason of an initial public offering of the Company's Stock.

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                             FILENE'S BASEMENT CORP.

                    AMENDMENT TO 1988 FILENE'S BASEMENT CORP.
                                STOCK OPITON PLAN


     Pursuant to a vote of the Board of Directors of Filene's Basement Corp.
(the "Company") on October 3, 1996, the 1988 Filene's Basement Corp. Stock
Option Plan (the "Plan") has been amended as follows:

1.   Paragraph 2 of Section 2 of the Plan is amended and restated in its 
entirety to read as follows:

     "The Board may, in its discretion, delegate its powers with respect to the
     Plan to a Committee (the "Committee"), in which event all references to the
     Board hereunder shall be deemed to refer to the Committee. The Committee
     shall be composed solely of at least two individuals who are Non-Employee
     Directors, as such term is defined in Rule 16b-3, and Outside Directors, as
     such term is defined in the Internal Revenue Code of 1986, as amended. A
     majority of the members of the Committee shall constitute a quorum, and all
     determinations of the Committee shall be made by a majority of its members.
     Any determination of the Committee under the Plan may be made without
     notice or meeting of the Committee by a writing signed by a majority of the
     Committee members."