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                                                                    EXHIBIT 10.5


                             BLUE RHINO CORPORATION

                     AMENDED AND RESTATED STOCK OPTION PLAN
                           FOR NON-EMPLOYEE DIRECTORS
               (AS AMENDED AND RESTATED THROUGH OCTOBER 31, 2001)
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                             BLUE RHINO CORPORATION

                     AMENDED AND RESTATED STOCK OPTION PLAN
                           FOR NON-EMPLOYEE DIRECTORS
               (AS AMENDED AND RESTATED THROUGH OCTOBER 31, 2001)


      This Amended and Restated Stock Option Plan for Non-Employee Directors
amends and restates in its entirety as of October 31, 2001, that certain Stock
Option Plan for Non-Employee Directors of Blue Rhino Corporation, which was
originally effective on May 18, 1998 and previously amended and restated as of
December 30, 1998 and May 17, 2001.

      SECTION 1. PURPOSE. The purpose of the Stock Option Plan for Non-Employee
Directors (the "Plan") is to attract and retain persons of exceptional ability
to serve as members of the Board of Directors of Blue Rhino Corporation (the
"Company"), and to align the interests of the Company's non-employee directors
with that of the stockholders in enhancing the value of the Company's capital
stock. This purpose will be carried out through the granting of nonqualified
stock options (individually, an "option," and collectively, "options") to
eligible non-employee directors of the Company.

      SECTION 2. ADMINISTRATION.

            (a) The Plan shall be administered by the Board of Directors of the
      Company (the "Board" or the "Board of Directors"), unless the Board
      delegates all or part of its discretion to administer the Plan to the
      Compensation Committee of the Board or such successor committee of the
      Board that is designated by the Board to administer the Plan
      (collectively, the "Committee"). The Committee shall be comprised of such
      number of "non-employee directors," as such term is defined in Rule 16b-3
      adopted under the Securities Exchange Act of 1934, as amended (the
      "Exchange Act"), as may be necessary to comply with Rule 16b-3, unless
      otherwise determined by the Board. For the purposes herein, the Board,
      and, upon delegation of authority to the Committee, the Committee, shall
      be referred to herein collectively as the "Administrator."

            (b) Any action of the Administrator may be taken by a written
      instrument signed by all of the members of the Board or the Committee, as
      the case may be, and any action so taken by written consent shall be as
      fully effective as if it had been taken by a majority of the members at a
      meeting duly held and called. Subject to the provisions of the Plan, the
      Administrator shall have full and final authority, in its discretion, to
      establish, amend and rescind rules and regulations for the administration
      of the Plan; to construe and interpret the Plan, the rules and
      regulations, and the agreements evidencing options granted under the Plan;
      and to make all other determinations deemed necessary or advisable for
      administering the Plan. Notwithstanding any other provision herein, (i)
      the Administrator also shall have authority, in its discretion, to
      accelerate the date that any option which was not otherwise exercisable or
      vested shall become exercisable or vested in whole or in part, and (ii)
      the Administrator shall also have authority, in its discretion, to extend
      the period during which an option may be exercised. To the extent, if any,
      necessary to comply with Rule 16b-3, provisions in SECTION 6 of the Plan
      relating to the grant of options following the annual meeting of
      stockholders of the Company, and
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      the amount, price and timing of such options, shall not be subject to the
      discretion of the Administrator or any other person. No member of the
      Administrator shall be liable for any action or determination made in good
      faith with respect to the Plan. The Administrator may delegate to an
      officer or officers of the Company the authorization to execute and
      deliver on behalf of the Company any document or instrument required to be
      delivered under this Plan.

      SECTION 3. TYPE OF OPTIONS. Options granted pursuant to the Plan shall be
nonstatutory options which are not intended to meet the requirements of SECTION
422 of the Internal Revenue Code of 1986, as amended (the "Code").

      SECTION 4. ELIGIBILITY. Directors of the Company who, at the time of
grant, are not employees or officers of the Company ("Eligible Directors") shall
be eligible to participate in the Plan. Each Eligible Director to whom options
are granted shall be referred to herein as a "Participant" in the Plan.

      SECTION 5. SHARES AVAILABLE UNDER THE PLAN. Subject to adjustment as
provided in SECTION 10 below, an aggregate of 400,000 shares of the Company's
Common Stock, par value $0.001 (the "Common Stock"), shall be available for
issuance pursuant to the provisions of the Plan. Such shares may be authorized
and unissued shares or may be shares issued and thereafter acquired by the
Company. If an option granted under the Plan shall expire or terminate for any
reason without having been exercised in whole or in part, the unpurchased shares
subject to such option shall again be available for subsequent option grants
under the Plan.

      SECTION 6. AUTOMATIC GRANT OF OPTIONS.

            (a)   Annual Grants.

                  (i) On December 30, 1998 each Eligible Director shall receive
            an option to purchase 8,000 shares of Common Stock. During the
            period commencing with the first annual meeting of stockholders to
            occur after December 30, 1998 and ending October 30, 2001, each
            Eligible Director of the Company shall receive an annual option
            grant to purchase 4,000 shares of Common Stock. Commencing October
            31, 2001, and thereafter, each Eligible Director shall receive an
            annual option grant to purchase 12,000 shares of Common Stock. The
            date of grant of an option (the "Grant Date") shall be December 30,
            1998 with respect to the options granted on that date and the first
            business day after each subsequent annual meeting of the
            stockholders with respect to the options granted on such subsequent
            dates.

                  (ii) Notwithstanding the provisions of SECTION 6(a) herein, in
            the event that a Participant fails to attend four Board meetings
            between the Grant Date and the date of the next annual meeting of
            the stockholders of the Company, the Participant shall forfeit
            options to purchase one-fourth (1/4) of the shares subject to the
            particular option for each meeting less than four which the
            Participant attends during such period; provided, however, that in
            the event the Participant fails to attend at least two Board
            meetings between the Grant Date and the date of the next annual
            meeting, the Participant shall forfeit all options granted

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            to him or her on the previous Grant Date. Participation by
            conference telephone or by other telecommunications equipment will
            be deemed attendance at a Board meeting for the purpose of receiving
            options under this SECTION 6(a).

            (b) Committee Meeting Grants. Commencing with the date of the 2001
Annual Meeting of Stockholders, and thereafter, each Eligible Director who
serves on the Board's Executive Committee, Audit Committee and/or Compensation
Committee (each, a "Committee"), shall receive an option for 1,000 shares of
Common Stock for each meeting of the respective Committee(s) on which the
Eligible Director serves at which such Eligible Director is in attendance. The
Grant Date for each such option shall be the date on which the corresponding
Committee meeting was held (or the first day of each Committee meeting if the
meeting extends more than one day). Participation by telephone conference or by
other telecommunications equipment will be deemed attendance at a Committee
meeting for the purpose of receiving options under this SECTION 6(b). Options
granted pursuant to SECTION 6(b) shall not be subject to the forfeiture
provisions of SECTION 6(a)(ii).

      SECTION 7. TERMS AND CONDITIONS OF OPTIONS.

      7.1 Exercise and Term of Options.

            (a) Each option granted under the Plan shall be exercisable at the
      rate of one-third (1/3) per year commencing on the first anniversary of
      the Grant Date, such that the option shall become exercisable in full on
      the third anniversary of each Grant Date, subject to the provisions of
      SECTION 7.1(b) and SECTION 9 hereof. Options granted under the Plan shall
      expire ten years from the date on which the option is granted, unless
      terminated earlier in accordance with the Plan.

            (b) Notwithstanding the provisions of SECTION 7.1(a) above, an
      option granted to any Participant shall become immediately exercisable in
      full upon the first to occur of:

                  (i) The death of the Participant, in which case the option may
            be exercised by the Participant's executor or administrator, or if
            not so exercised, by the legatees or distributees of his or her
            estate or by such other person or persons to whom the Participant's
            rights under the option shall pass by will or by the applicable laws
            of descent and distribution;

                  (ii)  Such time as the Participant ceases to be a director
            of the Company by reason of his or her permanent disability (as
            determined by the Administrator);

                  (iii) Such time as the Participant ceases to be a director of
            the Company as a result of retirement from the Board of Directors on
            or after attaining age 65; or

                  (iv) Such time as a Participant ceases to be eligible to
            participate in this Plan by reason of his or her becoming an
            employee of the Company or any of its subsidiaries.

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            (c) In the event a Participant ceases to be a director of the
      Company by reason of death as described in SECTION 7.1(b)(i), any option
      granted to such Participant hereunder shall expire 90 days from the date
      the Participant ceases to be a director of the Company, but in no event
      later than the day preceding the tenth anniversary of the Grant Date of
      such option.

            (d) In the event that the Participant ceases to be a director of the
      Company due to disability, retirement or becoming an employee of the
      Company or a subsidiary as described in SECTIONS 7.1(b)(ii) through (iv),
      and after his or her option has become exercisable in whole or in part,
      such option shall remain exercisable in whole or in part, as the case may
      be, in accordance with the terms hereof for a period of 30 days from the
      date the Participant ceases to be a director, but in no event later than
      the day preceding the tenth anniversary of the Grant Date of such option.

            (e) In the event that the services of a Participant as a director of
      the Company terminate for a reason other than due to death, disability,
      retirement or becoming an employee of the Company as provided in SECTION
      7.1(b)(i) through (iv) above, then his options shall terminate at the time
      of his termination of service; provided, however, that no portion of the
      option may be exercised later than the day preceding the tenth anniversary
      of the Grant Date of such option.

      7.2 Exercise Price. The exercise price of each share of Common Stock
subject to an option shall be the "Fair Market Value" of a share of Common Stock
on the Grant Date of the option. "Fair Market Value" means the value determined
on the basis of the good faith determination of the Administrator, without
regard to whether the Common Stock is restricted or represents a minority
interest, pursuant to the applicable method described below:

            (a) If the Common Stock is listed on a national securities exchange
      or quoted on The NASDAQ Stock Market ("NASDAQ"), the "Fair Market Value"
      shall be the closing price per share of the Common Stock on the date on
      which the option is granted or other determination is made (each, a
      "valuation date") or the most recent trading date preceding the valuation
      date for which such information is available, as reported by the principal
      national exchange on which such shares are traded (in the case of an
      exchange) or by the NASDAQ, as the case may be;

            (b) If the Common Stock is not listed on a national securities
      exchange or quoted on the NASDAQ, but is actively traded in the
      over-the-counter market, the "Fair Market Value" shall be the average of
      the closing bid and asked prices for the Common Stock on the valuation
      date, or the most recent trading date preceding the valuation date for
      which such quotations are reported; and

            (c) If, on the relevant date, the Common Stock is not publicly
      traded or reported as described in SECTION 7.2(a) or (b) herein, the "Fair
      Market Value" shall be determined in good faith by the Administrator.

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      7.3 Payment of Exercise Price; Tax Withholding.

            (a) Subject to the terms and conditions of the Plan, an option
      granted hereunder shall, to the extent then exercisable, be exercisable in
      whole or in part by giving written notice to the Company's Secretary
      stating the number of shares with respect to which the option is being
      exercised, accompanied by payment in full for such shares.

            (b) An option may be exercised by providing payment (i) in cash or
      check and (ii) if approved by the Administrator, payment in full or in
      part may also be made (A) by delivering Common Stock already owned by the
      Participant having a total Fair Market Value on the date of such delivery
      equal to the Option Price; (B) by authorizing the Company to retain shares
      of Common Stock which would otherwise be issuable upon exercise of the
      Option having a total Fair Market Value on the date of delivery equal to
      the Option Price; (C) by the delivery of cash by a broker-dealer to whom
      the Participant has submitted a notice of exercise (in accordance with
      Part 220, Chapter II, Title 12 of the Code of Federal Regulations,
      so-called "cashless" exercise); or (D) by any combination of the
      foregoing. No shares of Common Stock will be issued until full payment
      therefor has been made.

            (c) The Participant shall pay the Company an amount sufficient to
      cover withholding required by law for any federal, state, local or foreign
      taxes, if any, in connection with an exercise of options herewith. A
      Participant may elect in lieu of paying cash to deliver shares of Common
      Stock or direct the Company that shares of Common Stock be withheld to
      satisfy required tax withholding and such shares shall be valued at the
      Fair Market Value as of the exercise date and the Administrator shall
      determine the timing and other terms and conditions in which the use of
      shares of Common Stock to satisfy tax withholding may take place.

      7.4 Rights as a Stockholder. No person will have any rights of a
stockholder as to shares of Common Stock subject to an option until, after
proper exercise of the option or other action required, such shares have been
recorded on the Company's official stockholder records as having been issued or
transferred. Upon exercise of the option or any portion thereof, the Company
will have thirty (30) days in which to issue the shares, and the Participant
will not be treated as a stockholder for any purpose whatsoever prior to such
issuance. No adjustment will be made for cash dividends or other rights for
which the record date is prior to the date such shares are recorded as issued or
transferred in the Company's official stockholder records, except as provided
herein or in an option agreement.

      7.5 Documentation of Option Grants. Option grants shall be evidenced by
written instruments prescribed by the Administrator from time to time. The
instruments may be in the form of agreements to be executed by both the
Participant and the president or any vice president of the Company or in the
form of certificates, letters or similar instruments, which need not be executed
by the Participant but acceptance of which will evidence agreement to the terms
of the grant.

      7.6 Nontransferability of Options. Except as otherwise provided in this
SECTION 7.6, no option granted under the Plan shall be assignable or
transferable by the Participant to

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whom it is granted, either voluntarily or by operation of law, except (a) by
will or the laws of descent and distribution or (b) to the extent permitted by
the Administrator in a manner consistent with the registration provisions of the
Securities Act of 1933, as amended (the "Securities Act"), during the lifetime
of the Participant, to (i) the spouse or lineal descendants of the Participant
("Immediate Family Members"), (ii) a trust or trusts maintained for the
exclusive benefit of the Participant and/or such Immediate Family Members, or
(iii) a limited partnership or limited liability company in which the only
partners or members are the Participant and/or such Immediate Family Members,
formed for estate planning purposes; provided, that (y) the stock option
agreement or any amendment thereto executed by the Administrator pursuant to
which such option is granted must expressly provide for the transferability in a
manner consistent with this SECTION, and (z) subsequent transfers of a
transferred option shall be prohibited (except as otherwise provided in this
SECTION 7.6), and except that distributions may be made to the Participant
and/or such Immediate Family members from trusts, family limited partnerships or
family limited liability companies described herein). Following a transfer
permitted herein, any such option shall continue to be subject to the same terms
and conditions as were applicable immediately prior to transfer, provided, that
for the purposes of SECTIONS 7.3 and 7.4 of this Plan, the term "Participant"
shall be deemed to refer to the permitted transferee with respect of the options
so transferred. The events contained in SECTIONS 7.1(b), 7.1(c) 7.1(d) and
7.1(e) shall continue to be applied with respect to the original Participant,
and transferred options shall expire at or after the date the original
Participant ceases to be a director of the Company as provided in SECTIONS
7.1(c), 7.1(d) and 7.1(e) and shall otherwise be exercisable by the transferee
only to the extent and for the periods specified in SECTIONS 7.1 and 7.3.

      7.7 Approvals. The effectiveness of the Plan and any options granted
hereunder are subject to the approval of the Plan by affirmative vote of a
majority of the shares of the Common Stock present in person or by proxy and
entitled to vote at an annual or special meeting of the stockholders or by
written consent as provided in the Company's charter or by-laws. In the event
that the Plan is not approved by the stockholders, the Plan and any options
granted hereunder shall be void as of no effect.

      The Company's obligation to sell and deliver shares of Common Stock under
the Plan is subject to the approval of any governmental authority required in
connection with the authorization, issuance or sale of the Common Stock.

      SECTION 8. REGULATORY COMPLIANCE AND LISTING. The issuance or delivery of
any shares of stock subject to exercisable options hereunder may be postponed by
the Administrator for such period as may be required to comply with any
applicable requirements under federal securities laws, any applicable listing
requirements of any national securities exchange or similar organization or any
requirements under any law or regulation applicable to the issuance or delivery
of such shares. The Company shall not be obligated to issue or deliver any such
shares if the issuance or delivery thereof would constitute a violation of any
provision of any law or of any regulation of any governmental authority or any
rule of any national securities exchange or similar organization.

      SECTION 9. CHANGE IN CONTROL. Notwithstanding anything to the contrary in
the Plan, the following shall apply to all outstanding options granted under the
Plan:

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      9.1 Definitions. The following definitions shall apply to this SECTION 9:

            (a)   A "Change in Control" shall mean:

                  (i) The acquisition by any individual entity or group (within
            the meaning of SECTION 13(d)(3) or 14(d)(2) of the 1934 Act) or
            beneficial ownership (within the meaning of Rule 13d-3 promulgated
            under the 1934 Act) of 50% or more of the combined voting power of
            the then outstanding voting securities of the Company entitled to
            vote generally in the election of directors (the "Outstanding Voting
            Securities"); provided, however, that the following acquisitions
            shall not constitute a Change of Control: (A) any acquisition
            directly from the Company or any of its subsidiaries, (B) any
            acquisition by the Company or any of its subsidiaries, (C) any
            acquisition by any employee benefit plan (or related trust)
            sponsored or maintained by the Company or any of its subsidiaries,
            (D) any acquisition by any corporation with respect to which,
            following such acquisition, more than 50% of, respectively, the then
            outstanding shares of common stock of such corporation and the
            combined voting power of the then outstanding voting securities of
            such corporation entitled to vote generally in the election of
            directors is then beneficially owned, directly or indirectly, by
            individuals, entities or groups who were the beneficial owners,
            respectively, of at least 50% of the Outstanding Voting Securities
            immediately prior to such acquisition in substantially the same
            proportions as their ownership, immediately prior to such
            acquisition, of the Outstanding Voting Securities, or (E) the
            acquisition by any individual, entity or group which on the date
            this Plan was adopted by the Board owned 50% or more of the
            Outstanding Voting Securities.

                  (ii) Approval by the stockholders of the Company of a
            reorganization, merger or consolidation, in each case, with respect
            to which all or substantially all of the individuals and entities
            who were the beneficial owners, respectively, of the Outstanding
            Voting Securities immediately prior to such reorganization, merger
            or consolidation do not, following such reorganization, merger or
            consolidation, beneficially own, directly or indirectly, more than
            50% of the combined voting power of the then outstanding voting
            securities entitled to vote generally in the election of directors,
            as the case may be, of the corporation resulting from such
            reorganization, merger or consolidation in substantially the same
            proportions as their ownership, immediately prior to such
            reorganization, merger or consolidation, of the Outstanding Voting
            Securities; or

                  (iii) Approval by the stockholders of the Company of (A) a
            complete liquidation or dissolution of the Company or (B) the sale
            or other disposition of all or substantially all of the assets of
            the Company other than to a corporation, with respect to which
            following such sale or other disposition, more than 50% of,
            respectively, the then outstanding shares of common stock of such
            corporation and the combined voting power for the then outstanding
            voting securities of such corporation entitled to vote generally in
            the election of directors is then beneficially owned, directly or
            indirectly, by all or substantially all of the individuals and
            entities who were the beneficial owners, respectively, of the
            Outstanding Voting Securities immediately prior to such sale or
            other disposition

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            in substantially the same proportion as their ownership, immediately
            prior to such sale or other disposition, of the Outstanding Voting
            Securities.

            (b) "CIC Price" shall mean the higher of (i) the highest price paid
      for a share of Common Stock in the transaction or series of transactions
      pursuant to which a Change in Control of the Company shall have occurred,
      or (ii) the highest reported sales price of a share of Common Stock during
      the 60-day period immediately preceding the date upon which the event
      constituting a Change in Control shall have occurred.

      9.2 Acceleration of Vesting and Payment of Stock Options.

            (a) Upon the occurrence of an event constituting a Change in
      Control, all options outstanding on such date shall become 100% vested and
      exercisable and shall be repurchased by the Company by making a cash
      payment to the Participant for such options as soon as may be practicable.
      Upon such payment, such stock options shall be canceled.

            (b) The amount of cash to be paid to a Participant shall be
      determined by multiplying the number of shares subject to the
      Participant's outstanding options by the difference between the exercise
      price per share and the CIC Price, if higher.

            (c) Notwithstanding SECTION 9.2(a) and 9.2(b) herein, if the
      exercise price of options held by a Participant exceeds the CIC Price or
      the Fair Market Value on the date on which the first event constituting a
      Change in Control (as defined in SECTION 9.1 herein) occurs, as the case
      may be, such option shall be 100% vested and exercisable but shall not be
      canceled.

      SECTION 10. ADJUSTMENT IN EVENT OF CHANGES IN CAPITALIZATION. In the event
of a stock dividend, stock split or combination of shares, recapitalization or
other change in the Company's capitalization, or other distribution with respect
to holders of the Common Stock (other than normal cash dividends), automatic
adjustment shall be made in the number and kind of shares as to which
outstanding options or portions thereof then unexercised shall be exercisable
and in the available shares set forth in SECTION 5 hereof, to the end that the
proportionate interest of the option holder shall be maintained as before the
occurrence of such event. Such adjustment in outstanding options shall be made
without change in the total price applicable to the unexercised portion of such
options and with a corresponding adjustment in the option price per share.
Automatic adjustment shall also be made in the number and kind of shares subject
to options subsequently granted under the Plan.

      SECTION 11. NO RIGHT TO REELECTION. Nothing in the Plan shall be deemed to
create any obligation on the part of the Board to nominate any non-employee
director for reelection by the Company's stockholders, nor confer upon any
non-employee director the right to remain a member of the Board for any period
of time or at any particular rate of compensation.

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      SECTION 12. AMENDMENT AND TERMINATION.

            (a) The Board may amend, modify or terminate the Plan at any time
      and from time to time; provided, however, that unless required by law, no
      such amendment or modification shall (i) materially adversely affect any
      right or obligation with respect to any outstanding option without the
      consent of the holder of the option, or (ii) unless previously approved by
      the stockholders, increase the number of shares of Common Stock available
      for grants as provided in SECTION 5 hereof other than an adjustment
      pursuant to SECTION 10 hereof. In addition, no such amendment shall,
      unless previously approved by the stockholders (where such approval is
      necessary to satisfy then applicable requirements of federal securities
      laws, the Code or rules of any stock exchange on which the Company's
      Common Stock is listed) (i) in any manner affect the eligibility
      requirements set forth in SECTION 4 hereof, (ii) increase the number of
      shares of Common Stock subject to any option, (iii) change the purchase
      price of the shares of Common Stock subject to any option, (iv) extend the
      period during which options may be granted under the Plan, or (v)
      materially increase the benefits to Participants under the Plan.

            (b) Unless earlier terminated by the Board of Directors, or the
      shares reserved under the Plan shall have all been committed for options
      granted pursuant to the Plan, the Plan shall terminate on December 31,
      2008; provided, however, that options which are granted on or before this
      date shall remain exercisable in accordance with their respective terms
      after the termination of the Plan.

      SECTION 13. SUCCESSORS AND ASSIGNS. The Plan shall be binding on all
successors and permitted assigns of a Participant, including but not limited to,
the estate of such Participant and the executor, administrator or trustee of
such estate, the guardian or legal representative of the Participant.

      SECTION 14. GOVERNING LAW. The validity, construction and effect of the
Plan and any action taken or relating to the Plan shall be determined in
accordance with the laws of the State of Delaware, without regard to the
principles of conflicts of laws, and applicable federal law.

      SECTION 15. SECTION 16(B) COMPLIANCE. It is the intention of the Company
that transactions by Eligible Directors under the Plan shall comply with Rule
16b-3 under the Exchange Act. If any Plan provision is later found not to be in
compliance with SECTION 16 of the Exchange Act, then, unless the Administrator
shall determine otherwise, the provision shall be deemed null and void or
otherwise construed in such a manner as to enable transactions under the Plan to
meet the requirements of Rule 16b-3 or any successor rule.

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      IN WITNESS WHEREOF, this Amended and Restated Stock Option Plan for
Non-Employee Directors, as further amended and restated effective as of October
31, 2001, has been executed in behalf of the Company.

                                   BLUE RHINO CORPORATION


                                   By: /s/ Billy D. Prim
                                       --------------------------------------
                                           Billy D. Prim
                                           President and Chief Executive Officer
Attest:


/s/ Mark Castaneda
------------------------
Mark Castaneda
Secretary

[Corporate Seal]


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