Document:

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                                                                   Exhibit 10.28

                               SIXTH AMENDMENT TO
                                CREDIT AGREEMENT

     THIS SIXTH AMENDMENT TO CREDIT AGREEMENT (this "Sixth Amendment") is made
effective as of March 28, 2001, except as otherwise set forth herein, by and
among BED BATH & BEYOND INC., a New York corporation (the "Company"), and
BED-N-BATH STORES INC., a New Jersey corporation a/k/a BED 'N BATH STORES INC.
("BNBS"), BED BATH & BEYOND OF CALIFORNIA LIMITED LIABILITY COMPANY, a Delaware
limited liability company ("Calco"), and BBBY MANAGEMENT CORPORATION, a New
Jersey corporation ("BBBY", and together with BNBS, BBBL and Calco,
collectively, the "Guarantors" and individually, a "Guarantor," and the
Guarantors together with the Company, collectively, the "Credit Parties"); THE
CHASE MANHATTAN BANK, a New York banking corporation (the "Bank"); and BED BATH
& BEYOND PROCUREMENT CO. INC., a New York corporation ("Procurement Co.").

                              W I T N E S S E T H:

     WHEREAS, the Credit Parties (and BBBL, Inc., a Delaware corporation and an
original Guarantor and Credit Party, which as of March 31, 2001 shall be merged
with and into the Company with the Company continuing as the surviving
corporation) and the Bank are parties to that certain Credit Agreement, dated as
of October 26, 1994, as amended by that certain First Amendment, dated as of
October 1, 1995, as further amended by that certain Second Amendment, dated as
of February 24, 1997, that certain Third Amendment, dated as of September 11,
1997, that certain Fourth Amendment, dated as of September 19, 1997, and that
certain Fifth Amendment, dated as of October 26, 1998 (such Credit Agreement, as
amended by the First Amendment, the Second Amendment, the Third Amendment, the
Fourth Amendment, and the Fifth Amendment shall hereafter be known as, the
"Credit Agreement"); and

     WHEREAS, the Credit Parties and the Bank have agreed to further amend the
Credit Agreement to: (i) decrease the Revolving Credit Commitment to an
aggregate maximum principal amount of not to exceed at any time outstanding,
$25,000,000, (ii) effective March 31, 2001, add Bed Bath & Beyond Procurement
Co. Inc., a New York corporation and wholly-owned Subsidiary of the Company, as
a Guarantor and a Credit Party thereunder and an account party for Letters of
Credit as set forth therein, and (iii) otherwise modify certain of the terms and
provisions thereof;

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

     1.   MODIFICATION OF THE CREDIT AGREEMENT. The Credit Agreement is hereby
          amended in the following particulars:

          (A)  (i) Effective as of March 31, 2001, all references to the "Credit
               Parties" in the Credit Agreement are deemed to mean,
               collectively, the Company, BNBS, Calco, BBBY, and Procurement
               Co., as defined in this Sixth Amendment; and

               (ii) Effective as of March 31, 2001, all references to the
               "Guarantors" in the Credit Agreement are deemed to mean,
               collectively, BNBS, Calco, BBBY, and Procurement Co., as defined
               in this Sixth Amendment;

               (iii) All references to the "Agreement" or "this Agreement" in
               the Credit Agreement are deemed to mean the Credit Agreement, as
               amended by this Sixth Amendment; and all references to the "Loan
               Documents" in the Credit Agreement are deemed to mean the Credit

<PAGE>   2

               Agreement and the other Loan Documents, as amended by this Sixth
               Amendment;

               (iv) The aggregate maximum principal amount outstanding at any
               one time under the Revolving Credit Commitment is set forth
               opposite the Bank's name on the signature page of this Sixth
               Amendment;

               (v) All references to a "Responsible Officer" in the Credit
               Agreement with respect to financial matters are deemed to include
               the Vice President of Finance of the Company or any Guarantor, as
               well as the chief financial officer thereof; and

               (vi) All references to the "Revolving Credit Note(s)" or the
               "Notes(s)" in the Credit Agreement are deemed to mean that
               certain Third Amended and Restated Revolving Credit Note, dated
               as of March 28, 2001, as attached to this Sixth Amendment as
               EXHIBIT A (the "2001 Note"); and all references to the
               "Obligations" in the Credit Agreement are deemed to include,
               along with the other obligations set forth therein, all
               obligations of the Credit Parties (as re-defined in this Sixth
               Amendment) to the Bank under the 2001 Note.

          (B) Procurement Co. has requested that going forward the Bank issue
     Letters of Credit for its behalf (as well as for the account of Company).
     Procurement Co. shall execute and deliver to the Bank an Application. From
     and after March 31, 2001, upon receipt of such Application and in
     accordance with and subject to the terms of Section 3 of the Credit
     Agreement, the Bank hereby agrees to issue Letters of Credit for either or
     both of the Company and Procurement Co. Henceforth, all references to "the
     Company" throughout Section 3 of the Credit Agreement are deemed to mean
     the Company and/or Procurement Co., as an account party.

          (C) Section 14.2 of the Credit Agreement (Notices) is hereby amended
     so that notices to the Bank read as follows:

               "The Bank:                   The Chase Manhattan Bank
                                            695 Route 46 West
                                            Fairfield, New Jersey  07004
                                            Attention:  Andrea M. Johnson, VP
                                            Telecopy:  (973) 439-5017/18"

               Notices to the Bank's attorneys remain the same.

     2.   ESTOPPEL. To induce the Company, BNBS, Calco, and BBBY to enter into
          this Sixth Amendment, each of the Company, BNBS, Calco, and BBBY
          hereby represents and warrants to the Bank that:

          (A) As of March 28, 2001, there is currently $-0- of principal,
          together with accrued interest thereon, outstanding under the
          Revolving Credit Loan; and to the best of the Company's knowledge, the
          Company has no defenses, offsets or counterclaims regarding the same.

          (B) As of March 28, 2001, there is currently the amount set forth in
          SCHEDULE I to this Sixth Amendment of L/C Obligations outstanding
          under the Credit Agreement, and to the best of the Company's
          knowledge, the Company has no defenses, offsets or counterclaims
          regarding the same.

          (C) As of March 28, 2001, the Company has no defenses, offsets or
          counterclaims regarding its other Obligations to the Bank under the
          Credit Agreement.

          (D) As of March 28, 2001, each of BNBS, Calco, and BBBY has no
          defenses, offsets or counterclaims regarding its Obligations to the
          Bank under the Credit Agreement.

<PAGE>   3

     3.   ADDITION OF PROCUREMENT CO. AS A CREDIT PARTY AND A GUARANTOR. From
          and after March 31, 2001, Procurement Co. shall be considered a Credit
          Party and Guarantor under the Credit Agreement and the other Loan
          Documents and shall be bound by the terms and conditions thereof.

     4.   CONDITIONS PRECEDENT. The agreement of the Bank to amend the Credit
          Agreement as set forth in this Sixth Amendment shall not become
          effective unless the Bank shall have received, in form and substance
          reasonably satisfactory to the Bank and its counsel, the following:

          (A) This Sixth Amendment, duly executed and delivered by the parties
          hereto;

          (B) The 2001 Note, duly executed and delivered by the Company;

          (C) (i) True and complete copies (including all amendments) of the
          charter and bylaws of Procurement Co., certified by the corporate
          secretary of Procurement Co. to be in full force and effect as of
          March 31, 2001; and (ii) a corporate resolution of Procurement Co.,
          certified by its corporate secretary as of March 31, 2001 and in full
          force and effect authorizing: (x) the consummation of the transactions
          contemplated by this Sixth Amendment, and (y) specific officers to
          execute and deliver this Sixth Amendment and such other instruments
          and documents as may be executed in connection herewith;

          (D) A certificate of the corporate secretary of Procurement Co.
          certifying the names of the officers authorized to execute this Sixth
          Amendment and such other instruments and documents as may be executed
          in connection herewith, together with the true and genuine signatures
          of each of such officers;

          (E) Good standing certificates of the appropriate Governmental
          Authorities, dated the most recent practicable date on or about March
          31, 2001, showing Procurement Co. to be in good standing in its state
          of incorporation and such states in which such entity is authorized to
          do business;

          (F) Evidence of the merger of BBBL, Inc. with and into the Company,
          and the Company's continuance as the surviving corporation;

          (G) Payment of all reasonable fees and expenses incurred by the Bank
          in connection with this Sixth Amendment, including, but not limited
          to, reasonable fees and expenses of counsel to the Bank; and

          (H) Such other documents, certificates, opinions, affidavits, etc. as
          the Bank may reasonably request.

          Notwithstanding anything contained in Section 3 to the contrary, the
          items set forth in paragraphs (c) and (D) may be delivered by March
          31, 2001, and the items set forth in paragraph (E) of this Section 3
          may be delivered by April 16, 2001. The failure to deliver such items
          within such time period will constitute an Event of Default.

     5.   REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. Procurement Co.
          hereby makes the representations and warranties, and each of Company
          and the other Credit Parties hereby reaffirms the representations and
          warranties made by it, in the Credit Agreement and all of the other
          Loan Documents as fully and completely as if set forth herein at
          length. All of such representations and warranties are true, correct
          and complete as of March 31, 2001 (except as to such representations
          and warranties, which are made as of a specified date, in which case
          such representations and warranties remain true as of such date). In
          addition, each of Company and the other Credit Parties (including

<PAGE>   4

          Procurement Co.) represents and warrants to the Bank that:

          (A) Each of the Company and the other Credit Parties has the power and
          authority to enter into this Sixth Amendment;

          (B) The execution, delivery and performance of this Sixth Amendment
          and the instruments and documents executed and delivered by the
          Company and the other Credit Parties in connection herewith have been
          duly authorized by all requisite corporate or other action, and this
          Sixth Amendment and the instruments and documents executed and
          delivered in connection herewith constitute the legal, valid, and
          binding obligations of the Company and the other Credit Parties,
          enforceable against each of them (to the extent each is a party
          thereto), in accordance with their terms; and

          (C) No Event of Default has occurred and is continuing.

          (D) The execution and delivery of this Sixth Amendment and the
          instruments and documents executed and delivered in connection
          herewith, the consummation of the transactions contemplated hereunder
          and the fulfillment of or compliance with the terms and conditions
          contained herein by the Credit Parties are not prevented, or limited
          by, and do not result in the breach of, any terms, conditions or
          provisions of any requirements of law or any contractual obligations
          of the Credit Parties in any respect which could have a Material
          Adverse Effect.

          Each of the Company and the Credit Parties other than Procurement Co.
          represents and warrants to the Bank that there have been no amendments
          to its corporate/limited liability organizational documents since
          October 26, 1998 other than in connection with the merger of BBBL,
          Inc. with and into the Company, and that such organization documents
          remain in full force and effect as of March 31, 2001.

     6.   REAFFIRMATION OF COVENANTS. Procurement Co. hereby covenants and
          agrees to abide by the affirmative and negative covenants, and each of
          the Company and the other Credit Parties hereby reaffirms the
          affirmative and negative covenants, set forth in the Credit Agreement
          and the other Loan Documents fully and completely as if set forth
          herein at length, and agrees that such covenants shall remain in full
          force and effect until payment in full of the Obligations.

     7.   MISCELLANEOUS.

          (A) EFFECT OF AMENDMENT. Except as amended by this Sixth Amendment,
          all terms and provisions of the Credit Agreement and the other Loan
          Documents, and all rights of the Bank and obligations of the Company
          and the other Credit Parties thereunder, remain unchanged and in full
          force and effect, and are hereby ratified, adopted and confirmed in
          all respects. This Sixth Amendment is incorporated by reference in the
          Credit Agreement and the other Loan Documents. This Sixth Amendment is
          given as a modification of the Company's and the other Credit Parties'
          obligations to the Bank under the Credit Agreement and is not give in
          substitution therefor or extinguishment thereof and is not intended to
          be a novation.

          (B) COSTS AND EXPENSES. Each of the Company and the other Credit
          Parties agrees to pay all reasonable costs and expenses (including,
          without limitation, reasonable attorneys' fees and expenses) incurred
          by the Bank in connection with the preparation, execution, delivery
          and administration of this Sixth Amendment and the documents executed
          and delivered in connection herewith.

          (C) COUNTERPARTS. This Sixth Amendment may be executed in any number
          of counterparts, each of which when so executed shall be deemed to be
          an original and all of which when taken together
<PAGE>   5

          shall constitute one and the same agreement.

          (D) GOVERNING LAW. This Sixth Amendment shall be governed by and
          construed in accordance with the internal laws (and not the law of
          conflicts) of the State of New York.

                          (SIGNATURES ON THE NEXT PAGE)

<PAGE>   6

         IN WITNESS WHEREOF, the parties hereto have caused this Sixth Amendment
to be duly executed and delivered by their respective officers/members duly
authorized as of the effective date(s) set forth above.

                                        BED BATH & BEYOND INC.

                                        By:    /s/ Leonard Feinstein
                                               ---------------------------------
                                               Name: Leonard Feinstein
                                               Title: Co-Chief Executive Officer

                                        BED-N-BATH STORES INC.

                                        By:    /s/  Leonard Feinstein
                                               ---------------------------------
                                               Name: Leonard Feinstein
                                               Title: President

                                        BED BATH & BEYOND OF CALIFORNIA
                                               LIMITED LIABILITY COMPANY

                                        By:  BED BATH & BEYOND
                                               PROCUREMENT CO. INC.,
                                                sole member

                                        By:    /s/ Leonard Feinstein
                                               ---------------------------------
                                               Name: Leonard Feinstein
                                               Title: President

                                        BBBY MANAGEMENT CORPORATION

                                        By:    /s/ Leonard Feinstein
                                               ---------------------------------
                                               Name: Leonard Feinstein
                                               Title: Vice President

                                        BED BATH & BEYOND PROCUREMENT
                                         CO. INC.

                                        By:    /s/ Leonard Feinstein
                                               ---------------------------------
                                               Name: Leonard Feinstein
                                               Title: President

<PAGE>   7

REVOLVING LOAN COMMITMENT:                    THE CHASE MANHATTAN BANK
$25,000,000 (EFFECTIVE 3/28/01)

                                                  By:  /s/  Andrea M. Johnson
                                                       ----------------------
                                                       Name:   Andrea M. Johnson
                                                       Title:  Vice President<PAGE>   1
                                                                   Exhibit 10.29

                            BED BATH AND BEYOND INC.

                             2001 STOCK OPTION PLAN

     1 Purpose.

     The purpose of the Bed Bath & Beyond Inc. 2001 Stock Option Plan (the
"Plan") is to encourage and enable key employees (which term, as used herein,
shall include officers), and directors of Bed Bath & Beyond Inc. or a parent (if
any) or subsidiaries thereof (collectively, unless the context otherwise
requires, the "Company"), consultants, and advisors to the Company, and other
persons or entities providing goods or services to the Company to acquire a
proprietary interest in the Company. (Such directors, members, consultants,
advisors, and other persons or entities providing goods or services to the
Company and entitled to receive options hereunder being collectively referred to
as the "Associates," and the relationship of the Associates to the Company being
referred to as "association with" the Company.) Such ownership will provide such
employees and Associates with a more direct stake in the future welfare of the
Company and encourage them to remain employed by or associated with the Company.
It is also expected that the Plan will encourage qualified persons to seek and
accept employment or association with the Company.

     2 Effective Date and Term of Plan.

     (a) The effective date of the Plan shall be February 28, 2001, the date the
Plan was adopted by the Board of Directors of the Company (the "Board").

     (b) No option shall be granted under the Plan on or after the tenth
anniversary of the effective date of the Plan, but options previously granted
may extend beyond that date.

     3 Administration.

     (a) The Plan shall be administered by one or more committees appointed from
time to time by the Board (each such committee being referred to as a
"Committee"). In the event that more than one Committee is appointed by the
Board, the Board shall specify with respect to each Committee the group of
employees and Associates with respect to which such Committee shall have the
power to grant options. In the event that more than one Committee is appointed
by the Board, then each reference in the Plan to "the Committee" shall be deemed
a reference to each such Committee (subject to the last sentence of this
paragraph); provided, however, that each such Committee may only exercise the
power and authority granted to "the Committee" by the Plan with respect to those
employees and Associates that it has the power to grant options to as specified
in the resolution of the Board appointing such Committee. Each Committee shall
be comprised of two or more directors. A majority of the members of each
Committee shall constitute a quorum, and all determinations of the Committee
shall be made by a majority of its members. Any determination of any 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. All members of each
Committee shall be "non-employee directors" within the meaning of Rule 16(b)-3
under the Securities Act of 1933, as amended (the "Act"); provided, however,
that the foregoing shall not apply to any Committee that does not have the power
to grant options to officers or directors of the Company or otherwise make any
decisions with respect to the timing or the pricing of any options granted to
such officers and directors. If pursuant to the preceding sentence a Committee
is required to be comprised of "non-employee directors," then the members of
such Committee shall not be eligible to receive options under the Plan. In the
event that more than one Committee is appointed by the Board, the power to amend
the Plan granted by Section 9(b) hereof may only be
<PAGE>   2

exercised by a Committee all of whose members are "non-employee directors"
within the meaning of Rule 16(b)-3 under the Act.

     (b) The Committee shall have authority, not inconsistent with the express
provisions of the Plan, (i) to grant options which are not intended to be
incentive stock options as defined in Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code") to such eligible employees and Associates of
the Company as the Committee may select; provided, however, that (a) the maximum
number of options that may be granted under this Plan to any employee or
Associate of the Company over the term of the Plan shall not exceed 1,000,000
shares (subject to any adjustment in accordance with Section 7(b)), and (b)
options shall only be granted to directors and officers (as defined in Rule
16(a)-1(f) under the Securities Exchange Act of 1934, as amended) of the Company
to the extent permitted by the rules of the National Association of Securities
Dealers, for so long as the Stock is quoted through the NASDAQ (as defined
below), and/or the rules and regulations of such other automated quotation
systems or securities exchanges on which the Stock (as defined below) may
hereafter be listed; (ii) to determine the time or times when options shall be
granted and the number of Shares subject to each option; (iii) to determine the
terms and conditions of each option; (iv) 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; (v) to adopt, amend and rescind
rules and regulations for the administration of the Plan; and (vi) to interpret
the Plan and to decide any questions and settle all controversies and disputes
that may arise in connection with the Plan. Any determination, decision or
action of the Committee in connection with the construction, interpretation,
administration or application of the Plan shall be final and conclusive on all
persons participating in the Plan.

     4 Shares Subject to the Plan.

     (a) Number of Shares.

     Subject to adjustment as provided in Section 7, the aggregate number of
shares of the Company's common stock (the "Shares" or "Stock") that may be
delivered upon the exercise of options granted under the Plan shall be
10,000,000. If any option granted under the Plan terminates without having been
exercised in full, the number of Shares 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 Committee 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.

     5 Eligibility for Options.

     Employees and Associates of the Company eligible to receive options under
the Plan shall be those employees and Associates who, in the opinion of the
Committee, are in a position to make a significant contribution to the success
of the Company. In addition, directors and officers (as defined in Rule
16(a)-1(f) under the Securities Exchange Act of 1934, as amended) of the Company
shall only be eligible to receive options under the Plan to the extent permitted
by the rules of the National Association of Securities Dealers, for so long as
the Stock is quoted through the NASDAQ (as defined below), and/or the rules and
regulations of such other automated quotation systems or securities exchanges on
which the Stock may hereafter be listed. Receipt of options under the Plan or of
awards under any other employee benefit plan of the Company shall not preclude
an employee from receiving options or additional options under the Plan.

<PAGE>   3

     6 Terms and Conditions of Options.

     (a) Exercise Price. The exercise price of each option shall be determined
by the Committee which may be based on the fair market value per share of Stock
at the time the option is granted. The fair market value of a share of Stock as
of any date shall be determined for purposes of the Plan by such method as the
Committee determines to be reasonable.

     (b) Duration of Options. An option shall be exercisable during such period
or periods as the Committee may specify. The latest date on which an option may
be exercised (the "Final Exercise Date") shall be the date which is ten years
from the date the option was granted or such earlier date as may be specified by
the Committee at the time the option is granted.

     (c) Exercise of Options.

     (1)  At the time of the grant of an option, the Committee shall specify
          whether the option shall be exercisable in full at any time prior to
          the Final Exercise Date or in installments (which may be cumulative or
          noncumulative). In the case of an option not immediately exercisable
          in full, the Committee 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 options shall contain
          such provisions relating to exercise and other matters as the
          Committee may determine.

     (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 Committee
          and (b) payment in full for the number of Shares for which the option
          is exercised.

     (4)  The Committee 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.

     (5)  If an option is exercised by the executor or administrator of a
          deceased employee or Associate, or by the person or persons to whom
          the option has been transferred by the employee or Associate, 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.

     (d)  Termination of Employment.

     An employee's options shall terminate immediately upon the termination of
his employment with the Company, subject to the following exceptions: (i) if the
termination is by reason of the death or disability of the employee, the
unexercised portion of such options shall continue to be exercisable for 12
months after such termination and (ii) if the termination is for any other
reason, excluding termination for cause, the unexercised portion of such options
shall continue to be exercisable for three months after such termination.
Notwithstanding the foregoing, the Committee in its discretion in any particular
case may provide that upon termination of an employee's employment with the
Company, the unexercised portion of his options shall continue to be exercisable
for a longer or shorter period than the period provided for in the preceding
sentence; provided, however, that the Committee may not provide for a shorter
period after the option is granted. For purposes of this Section 6(d),
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
Committee, 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

<PAGE>   4

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.

     (e) Payment for 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 Committee (not later than the time of
grant, in the case of an incentive option), (A) through the delivery of shares
of Stock (including shares acquired under the option then being exercised)
having a fair market value (determined as provided in Section 6(a)) on 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.

     (f) Delivery of 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 or quoted through the National
Association of Securities Dealers Automatic Quotation ("NASDAQ") National Market
System, until the shares to be delivered have been listed or authorized to be
listed on such exchange or System 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 Act, 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 the Act and may require
that the certificates evidencing such Stock bear an appropriate legend
restricting transfer.

     (g) Nontransferability of Options.

     In the case of an option which is not an incentive stock option, the
Committee may provide that options may be transferred to the extent and subject
to such limitations as the Committee may specify.

     (h) Restrictions on Stock.

     The Committee 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 Committee 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 Mergers, Recapitalizations, etc.

     (a) In the event of a consolidation or merger in which the Company is not
the surviving corporation or in the event of any transaction that results in the
acquisition of substantially all of 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 of the Company's
assets (all the foregoing being referred to as "Acquisition Events"), then the

<PAGE>   5

Committee may in its discretion terminate all outstanding options by delivering
notice of termination to each option holder; provided, however, that, during the
20-day period following the date on which such notice of termination is
delivered, each option holder shall have the right to exercise in full all of
his options that are then outstanding (without regard to limitations on exercise
otherwise contained in the options). If an Acquisition Event occurs and the
Committee does not terminate the outstanding options pursuant to the preceding
sentence, then the provisions of Section 7(b) shall apply.

     (b) 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 of 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 Committee. The
Committee 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 any other event (including, without limitation,
accounting changes) if the Committee determines that such adjustment is
appropriate to avoid distortion in the operation of the Plan. All determinations
and adjustments made by the Committee pursuant to this Section 7(b) shall be
binding on all persons.

     (c) The Committee 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 of
property or stock of the employing corporation. The Company may direct that
substitute awards be granted on such terms and conditions as the Committee
considers appropriate in the circumstances.

     8 Limitation on 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 affect in any
way the right of the Company to terminate the employment of an employee at any
time. Except as specifically provided by the Committee 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.

     9 Effect, Discontinuance, Cancellation, Amendment and Termination.

     (a) 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.

     (b) The Committee may at any time discontinue granting options under the
Plan. With the consent of the option holder, the Committee may at any time
cancel an existing option in whole or in part and grant the option holder
another option for such number of shares as the Committee specifies The
Committee may at any time or times amend the Plan or any outstanding option for
the purpose of satisfying any changes in applicable laws or regulations or for
any other purpose which may at the time be permitted by law, or at any time
terminate the Plan as to any further grants of options, provided that (except to
the extent expressly required or permitted above) no such amendment shall,
without the approval of the Board, (a) increase the maximum number of shares
available under the Plan, (b) change the group of employees or Associates
eligible to receive options under the Plan, (c) extend the time within which
options may be granted, or (d) amend the provisions of this Section 9, and no
such amendment shall adversely affect the rights of any option holder (without
such holder's consent) under any option previously granted.

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