Document:

KINDERCARE LEARNING CENTERS, INC.

                                 RESTATED BYLAWS

                                    ARTICLE I

                            MEETINGS OF STOCKHOLDERS

          Section 1. Place of Meeting and Notice. Meetings of the stockholders
of the Corporation shall be held at such place either within or without the
State of Delaware as the Board of Directors may determine, or, in the sole
discretion of the Board of Directors, shall not be held at any place, but may
instead be held solely by means of remote communication as authorized by
Delaware General Corporation Law.

          Section 2. Annual and Special Meetings. Annual meetings of
stockholders shall be held at a date, time, place, if any, and by means of
remote communications if any, by which stockholders and proxy holders may be
deemed to be present in person and vote at such meeting as fixed by the Board of
Directors and stated in the notice of meeting, to elect a Board of Directors and
to transact such other business as may properly come before the meeting. Special
meetings of the stockholders may be called by the Board of Directors or Chief
Executive Officer for any purpose and shall be called by the Chief Executive
Officer or Secretary if directed by the Board of Directors or requested in
writing by the holders of not less than 25% of the capital stock of the Company.
Each such stockholder request shall state the purpose of the proposed meeting.

          Section 3. Notice. Except as otherwise provided by law, at least 10
and not more than 60 days before each meeting of stockholders, written notice,
or electronic transmission of notice if consented to by a stockholder entitled
to notice, of the time, date and place (or means of remote communication if
applicable) of the meeting, and, in the case of a special meeting, the purpose
or purposes for which the meeting is called, shall be given to each stockholder.
Any previously scheduled annual or special meeting of the stockholders may be
postponed or canceled by resolution of the Board of Directors upon public notice
given prior to the time previously scheduled for such meeting of stockholders.

          Section 4. Waiver of Notice. Whenever notice is required to be given
to stockholders under any provision of the Delaware General Corporation Law, the
Certificate of Incorporation or the Bylaws, a written waiver, signed by the
stockholder entitled to notice, or a waiver by electronic transmission by the
person entitled to notice, whether before or after the time stated therein,
shall be deemed equivalent to notice. Attendance of a stockholder at a
stockholders meeting shall constitute a waiver of notice of such meeting, except
when the stockholder attends a meeting for the express purpose of objecting at
the beginning of the meeting to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the
stockholders need by specified in any written or electronic transmission waiver
of notice.

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          Section 5. Fixing of Record Date.

          (a) Record Date Fixed by Board of Directors. In order that the
Corporation may determine the stockholders entitled to notice of or to vote at
any meeting of the stockholders or any adjournment thereof, or entitled to
receive payment of any dividend or other distribution or allotment of any
rights, or entitled to exercise any rights in respect of any change, conversion
or exchange of stock or for the purpose of any other lawful action, the Board of
Directors may fix a record date, which shall not (i) precede the date upon which
the resolution fixing the record date is adopted by the Board of Directors, (ii)
be more than 60 nor less than 10 days before the date of such meeting, or (iii)
be more than 60 days prior to any action other than a meeting.

          (b) Record Date Not Fixed by Board of Directors. If no record date is
fixed by the Board of Directors:

               (i) The record date for determining stockholders entitled to
notice of or to vote at a meeting of the stockholders shall be the close of
business on the day next preceding the day on which notice is given or, if
notice is waived, at the close of business on the day next preceding the day on
which the meeting is held.

               (ii) The record date for determining stockholders for any other
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto.

          (c) Record Date for Stockholder Consent. In order that the Corporation
may determine the stockholders entitled to consent to corporate action in
writing without a meeting, the Board of Directors may fix a record date, which
record date shall not precede the date upon which the resolution fixing the
record date is adopted by the Board of Directors, and which date shall not be
more than ten days after the date upon which the resolution fixing the record
date is adopted by the Board of Directors. If no record date has been fixed by
the Board of Directors, the record date for determining stockholders entitled to
consent to corporate action in writing without a meeting, when no prior action
by the Board of Directors is required by the Delaware General Corporation Law,
shall be the first date on which a signed written consent setting forth the
action taken or proposed to be taken is delivered to the Corporation by delivery
to its registered office in Delaware, its principal place of business, or an
officer or agent of the Corporation having custody of the book in which
proceedings of meetings of stockholders are recorded. Delivery made to the
Corporation's registered office shall be by hand or by certified or registered
mail, return receipt requested. If no record date has been fixed by the Board of
Directors and prior action by the Board of Directors is required by the Delaware
General Corporation Law, the record date for determining stockholders entitled
to consent to corporate action in writing without a meeting shall be at the
close of business on the day on which the Board of Directors adopts the
resolution taking such prior action.

          (d) Adjourned Meetings. A determination of stockholders of record
entitled to notice of or to vote at a meeting of the stockholders shall apply to
any adjournment of the meeting, provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.

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          Section 6. List of Stockholders for Meeting. After a record date for a
meeting of the stockholders is fixed and at least 10 days before any such
meeting, the Corporation shall prepare an alphabetical list of all stockholders
entitled to vote at the meeting of the stockholders showing the address of each
stockholder and the number of shares registered in the name of each stockholder,
but need not include electronic mail addresses or other electronic contact
information on such list. Such list shall be open to examination of any
stockholder, for any purpose germane to the meeting for a period of at least 10
days prior to the meeting: (i) on a reasonably accessible electronic network,
provided that the information required to gain access to such list is provided
with the notice of the meeting, or (ii) during ordinary business hours, at the
principal place of business of the Corporation. In the event that the
Corporation determines to make the list available on an electronic network, the
Corporation may take reasonable steps to ensure that such information is
available only to stockholders of the Corporation. If the meeting is to be held
at a place, then the list shall be produced and kept at the time and place of
the meeting during the whole time thereof, and may be inspected by any
stockholder who is present. If the meeting is to be held solely by means of
remote communication, then the list shall also be open to the examination of any
stockholder during the whole time of the meeting on a reasonably accessible
electronic network, and the information required to access such list shall be
provided with the notice of meeting. Refusal or failure to prepare or make
available the list of stockholders does not affect the validity of action taken
at the meeting except that upon the willful neglect or refusal of the Directors
to produce such a list at any meeting, held at a place, or to open such a list
to reasonable examination on a reasonably accessible electronic network during
any meeting for the election of directors held solely by means of remote
communication, they shall be ineligible for election to any office at such
meeting.

          Section 7. Quorum; Adjournment.

          (a) Quorum. At any meeting of stockholders, the holders of record,
present in person or by proxy, of a majority of the Corporation's issued and
outstanding capital stock shall constitute a quorum for the transaction of
business, except as otherwise provided by law. Once a share is represented for
any purpose at a meeting, it shall be present for quorum purposes for the
remainder of the meeting and for any adjournment of that meeting unless a new
record date is set for the adjourned meeting.

          (b) Adjournment. Any annual or special meeting of stockholders may be
adjourned by the chairman of the meeting from time to time. If the meeting is to
be reconvened at another time or place, if any, or means of remote
communication, if any, notice need not be given of any such adjourned meeting if
the time, date and place, if any, and the means of remote communications, if
any, by which stockholders and proxy holders may be deemed to be present in
person and vote at such adjourned meeting are announced at the meeting at which
the adjournment is taken. The stockholders present at a meeting shall not have
authority to adjourn the meeting. At the adjourned meeting at which a quorum is
present, the stockholders may transact any business which might have been
transacted at the original meeting. If the adjournment is for more than 30 days,
or if after the adjournment a new record date is fixed for the adjourned
meeting, notice of the adjourned meeting shall be given to each stockholder of
record entitled to vote at the meeting.

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          Section 8. Voting. If a quorum exists, action by the stockholders on a
matter, other than the election of Directors, is approved by the affirmative
vote of a majority of the shares present in person or represented by proxy at
the meeting and entitled to vote on the matter. Unless otherwise provided in the
Certificate of Incorporation, Directors are elected by a plurality of the votes
of the shares present in person or represented by proxy at the meeting and
entitled to vote in the election at a meeting at which a quorum is present.

          Section 9. Proxies. Each stockholder entitled to vote at a meeting of
stockholders may vote shares in person or by proxy. A stockholder may appoint a
proxy either by personally executing an appointment form or by causing the
stockholder's agent or attorney-in-fact to execute such form, or by such other
means as is specifically authorized by Delaware General Corporation Law. An
appointment of a proxy is effective when received by the Secretary or other
officer of the Corporation authorized to tabulate votes, but no proxy shall be
voted or acted upon after three years from its date, unless the proxy provides
for a longer period. An appointment is revocable by the stockholder unless the
appointment form conspicuously states that it is irrevocable and the appointment
is coupled with an interest sufficient in law to support an irrevocable power.

          Section 10. Conduct of Meetings. Meetings of stockholders shall be
presided over by the Chairman of the Board of Directors or such other person
designated by the Board of Directors. The date and time of the opening and the
closing of the polls for each matter upon which the stockholders will vote at a
meeting shall be determined by the chairman of the meeting and announced at the
meeting. The Board of Directors may adopt by resolution such rules and
regulations for the conduct of the meeting of stockholders as it shall deem
appropriate and as are consistent with applicable law. Except to the extent
inconsistent with such rules and regulations as adopted by the Board of
Directors, the chairman of any meeting of stockholders shall have the exclusive
right and authority to prescribe such rules, regulations and procedures and to
do all such acts as, in the judgment of such chairman, are appropriate for the
proper conduct of the meeting. Such rules, regulations or procedures, whether
adopted by the Board of Directors or prescribed by the chairman of the meeting,
may include, without limitation, the following: (a) the establishment of an
agenda or order of business for the meeting; (b) rules and procedures for
maintaining order at the meeting and the safety of those present; (c)
limitations on attendance at or participation in the meeting to stockholders of
the Corporation, their duly authorized and constituted proxies or such other
persons as the chairman of the meeting shall determine; (d) restrictions on
entry to the meeting after the time fixed for the commencement thereof; and (e)
limitations on the time allotted to questions or comments by participants.
Unless and to the extent determined by the Board of Directors or the chairman of
the meeting, meetings of stockholders shall not be required to be held in
accordance with the rules of parliamentary procedure.

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                                   ARTICLE II

                                    DIRECTORS

          Section 1. Number, Election and Removal of Directors; Chairman of the
Board. The number of Directors that shall constitute the Board of Directors
shall not be less than one or more than fifteen. Within the limits specified
above, the number of Directors shall be determined by the Board of Directors.
The Directors shall be elected by stockholders at their annual meeting.
Vacancies and newly created directorships resulting from any increase in the
number of Directors may be filled by a majority of the Directors then in office,
although less than a quorum, by the sole remaining Director or by the
stockholders. A Director may be removed with or without cause by the
stockholders. The Directors shall elect a Chairman of the Board.

          Section 2. Regular Meetings. A regular meeting of the Board of
Directors may be held without notice immediately after, and at the same place
as, the annual meeting of the stockholders. Regular meetings of the Board of
Directors shall be held at such times and places as may be from time to time
fixed by the Board of Directors. Notice need not be given of regular meetings of
the Board of Directors.

          Section 3. Special Meetings. Special meetings of the Board of
Directors may be called at any time by the Chairman of the Board, the Chief
Executive Officer or a majority of the Directors then serving and shall be
called by the Chairman of the Board, the Chief Executive Officer or the
Secretary upon direction by the Board of Directors.

          Section 4. Notice. Notice of the date, time and place of any special
meeting of the Board of Directors shall be given at least 24 hours prior to the
meeting by notice communicated in person, by telephone, email, facsimile
transmission, other form of wire or wireless communication, mail or courier
service sent to Director's business or home address. If mailed, notice shall be
effective at the earliest of (a) when received, (b) five days after its deposit
in the United States mail, as evidenced by the postmark, if mailed postpaid and
correctly addressed, (c) on the date shown on the return receipt, if sent by
registered or certified mail, return receipt requested and the receipt is signed
by or on behalf of the addressees, (d) if given by facsimile or email upon
transmission of the message, or (e) if given by overnight mail or courier, one
day after delivery to the overnight mail or courier service company. Notice by
all other means shall be deemed effective when received by or on behalf of the
Director. Notice of any regular or special meeting need not describe the
purposes of, or the business to be transacted at, the meeting unless required by
law or the Certificate of Incorporation.

          Section 5. Waiver of Notice. Whenever notice to directors is required
to be given under any provision of the Delaware General Corporation Law, the
Certificate of Incorporation or the Bylaws, a written waiver, signed by the
director entitled to notice, whether before or after the time stated therein,
shall be deemed equivalent to notice. Attendance of a director at a meeting
shall constitute a waiver of notice of such meeting, except when the director
attends a meeting for the express purpose of objecting at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully
called or convened. Neither the business to

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be transacted at, nor the purpose of, any regular or special meeting of the
directors, or members of a committee of directors need be specified in any
written waiver of notice.

          Section 6. Quorum. One-third of the total number of Directors shall
constitute a quorum for the transaction of business. If a quorum is not present
at any meeting of the Board of Directors, the Directors present may adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until such a quorum is present. Except as otherwise provided by law,
the Certificate of Incorporation of the Corporation, these Bylaws or any
contract or agreement to which the Corporation is a party, the act of a majority
of the Directors present at any meeting at which there is a quorum shall be the
act of the Board of Directors.

          Section 7. Meeting by Telephone Conference; Action Without Meeting.

          (a) Telephone Conference Call. Directors may participate in a regular
or special meeting of the Board, or any meeting of a committee designated by the
Board by, or conduct such meeting through, use of any means of communications by
which all directors participating may simultaneously hear each other during the
meeting. Participation in a meeting by this means shall constitute presence in
person at such meeting.

          (b) Action Without Meeting. Any action that is required or permitted
to be taken at a meeting of the Board of Directors, or any committee thereof,
may be taken without a meeting if one or more written consents describing the
action taken are signed by all of the Directors entitled to vote on the matter
and included in the minutes of proceedings of the Board of Directors or the
committee thereof. The action shall be effective when the last Director signs
the consent, unless the consent specifies an earlier or later effective date.

          Section 8. Committees. The Board of Directors may, by resolution
adopted by a majority of the whole Board, designate one or more committees,
including, without limitation, an Executive Committee, to have and exercise such
power and authority as the Board of Directors shall specify, subject to
limitations imposed by the Delaware General Corporation Law, and appoint one or
more Directors to serve on them. In the absence or disqualification of a member
of a committee, the member or members thereof present at any meeting and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another Director to act at the meeting in the place of any
such absent or disqualified member. Subject to the provisions of the Delaware
General Corporation Law, the Board of Directors shall have the power at any time
to change the number of committee members, fill committee vacancies, change any
committee members and change the functions and terminate the existence of a
committee. Unless otherwise determined by the Board of Directors, each committee
shall conduct its meetings in accordance with the applicable provisions of these
Bylaws relating to meetings and action without meetings of the Board of
Directors. By resolution dated August 1, 2001, adopted by a majority of the
whole Board, the Corporation has elected to be governed by paragraph (2) of
Section 141(c) of the Delaware General Corporation Law.

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                                   ARTICLE III

                                    OFFICERS

          The officers of the Corporation shall consist of a Chief Executive
Officer, a Secretary, and such other additional officers with such titles as the
Board of Directors shall determine, all of which shall be chosen by and shall
serve at the pleasure of the Board of Directors. Such officers shall have the
usual powers and shall perform all the usual duties incident to their respective
offices. All officers shall be subject to the supervision and direction of the
Board of Directors. The authority, duties or responsibilities of any officer of
the Corporation may be suspended by the Chief Executive Officer with or without
cause, and the Chief Executive Officer may terminate the employment of any
officer with or without cause. Any officer elected or appointed by the Board of
Directors may be removed by the Board of Directors with or without cause.

                                   ARTICLE IV

                                 INDEMNIFICATION

          The Corporation shall indemnify Directors and officers (as such terms
are defined in the Certificate of Incorporation) of the Corporation as specified
in the Certificate of Incorporation. In addition, to the fullest extent
permitted by the Delaware General Corporation Law, the Corporation shall
indemnify any current or former Director or officer of the Corporation and may,
at the discretion of the Board of Directors, indemnify any current or former
employee or agent of the Corporation against all expenses, judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with any threatened, pending or completed action, suit or proceeding brought by
or in the right of the Corporation or otherwise, to which he was or is a party
by reason of his current or former position with the Corporation or by reason of
the fact that he is or was serving, at the request of the Corporation, as a
Director, officer, partner, trustee, employee or agent of another Corporation,
partnership, joint venture, trust or other enterprise.

          Expenses incurred by a person who is or was a Director or officer of
the Corporation in appearing at, participating in or defending any such action,
suit or proceeding shall be paid by the Corporation at reasonable intervals in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of the Director or officer to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Corporation as authorized by this Article. If a claim under
this Article is not paid in full by the Corporation within ninety days after a
written claim has been received by the Corporation, the claimant may at any time
thereafter bring suit against the Corporation to recover the unpaid amount of
the claim and, if successful in whole or in part, the claimant shall be paid
also the expense of prosecuting such claim. It shall be a defense to any such
action (other than an action brought to enforce a claim for expenses incurred in
defending any proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the Corporation) that the
claimant has not met the standards of conduct which make it permissible under
the Delaware General Corporation Law or other applicable law for the

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Corporation to indemnify the claimant for the amount claimed, but the burden of
proving such defense shall be on the Corporation. Neither the failure of the
Corporation (including its board of directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the circumstances
because he has met the applicable standard of conduct set forth in the Delaware
General Corporation Law or other applicable law, nor an actual determination by
the Corporation (including its board of directors, independent legal counsel, or
its stockholders) that the claimant has not met the applicable standard of
conduct, shall be a defense to the action or create a presumption that the
claimant has not met the applicable standard of conduct.

                                    ARTICLE V

                               GENERAL PROVISIONS

          Section 1. Notices. Whenever any statute, the Certificate of
Incorporation or these Bylaws require notice to be given to any stockholder,
such notice may be given in writing by mail, addressed to such stockholder at
his, her or its address as it appears in the records of the Corporation, with
postage thereon prepaid, or in a form of electronic transmission consented to by
the stockholder to whom notice is given in accordance with Delaware General
Corporation Law. Such notice shall be deemed to have been given when, if mailed,
it is deposited in the United States mail or, if sent by electronic
transmission, when directed to an electronic address or number at which the
stockholder has consented to receive notice or such other means as permitted by
Delaware General Corporation Law.

          Section 2. Fiscal Year. The fiscal year of the Corporation shall be
fixed by the Board of Directors.

          Section 3. Amendments. These Bylaws may be amended or repealed and new
Bylaws may be adopted by the Board of Directors or the stockholders of the
Corporation.

Restated Bylaws adopted by the Board of Directors on September 1, 2001.

                                       8RESTATED

                        KINDERCARE LEARNING CENTERS, INC.

                     NONQUALIFIED DEFERRED COMPENSATION PLAN

                                 January 1, 1999

KinderCare Learning Centers, Inc.
a Delaware corporation
650 NE Holladay, Suite 1400
Portland, OR  97232                                                      Company

<PAGE>
                                TABLE OF CONTENTS

Section                                                                     Page

1.   Purposes; Administration; Plan Year....................................

2.   Eligibility............................................................

3.   Compensation Deferral..................................................

4.   Deferred Compensation Account..........................................

5.   Irrevocable Trust......................................................

6.   Time and Manner of Payment.............................................

7.   Withdrawals............................................................

8.   Death, Disability and Change in Control................................

9.   Termination; Amendment.................................................

10.  Claims Procedure.......................................................

11.  General Provisions.....................................................

12.  Effective Date.........................................................

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                                 INDEX OF TERMS

Term                                                   Section             Page

Committee                                                1.2                1
Company                                                Preamble             1
Company Match                                            3.3                3

Deferral election                                        3.1                2
Deferred compensation account                            4.1                3
Disabled                                                 8.6                9

Eligible employee                                        2.1                1
Employer                                                 1.1                1

Guideline fund                                           5.2                4

Participant                                              2.3                2
Payment Date                                             6.2                5
Plan Year                                                1.3                1

Unforseen emergency                                      7.2                7

Vesting                                                  6.1                5

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                                    RESTATED

                        KINDERCARE LEARNING CENTERS, INC.

                     NONQUALIFIED DEFERRED COMPENSATION PLAN

                                 January 1, 1999

KinderCare Learning Centers, Inc.
a Delaware corporation
650 NE Holladay, Suite 1400
Portland, OR  97232                                                      Company

          The Company adopted and maintains the Restated KinderCare Learning
Centers, Inc. Nonqualified Deferred Compensation Plan, effective August 1, 1996.
The Company adopts this Amendment and Restatement to add a Company Match,
provide a schedule for vesting of the Company Match, provide for limited
withdrawals and implement editorial and administrative changes.

     1.   Purposes; Administration; Plan Year

          1.1 This plan is adopted to permit eligible employees of Employers to
defer all or a portion of what would otherwise be current compensation. The plan
shall apply to the Company and affiliates of the Company designated by the
Committee under 6.7. The term "Employer" refers to the Company and all
designated affiliates.

          1.2 This plan shall be administered by an Administrative Committee
(Committee) appointed by the Compensation Committee of the Board of Directors of
the Company. The Committee shall interpret the plan and make determinations
about participation and benefits. Any decision by the Committee within its
authority shall be final and binding on all parties. The Committee may delegate
all or part of its authority.

          1.3 The Plan Year shall be a calendar year.

     2.   Eligibility

          2.1 An employee of an Employer shall be eligible to participate for a
Plan Year if the employee is designated by the Committee to participate in the
plan. Participation shall be restricted to a select group of management or
highly compensated employees as designated by the Committee

          2.2 An employee eligible under 2.1 may participate in elective
deferrals by filing a deferral election as follows:

               (a) An employee who is eligible on the effective date of the plan
          or who later becomes eligible during a year may participate with
          respect to future compensation by filing an election within 30 days
          after being notified of eligibility by the Committee.

               (b) Except as provided in (a), an election for a year must be
          filed before the start of the year.

          2.3 A person having an account under the plan shall be known as a
participant.

     3.   Compensation Deferral

          3.1 An eligible employee may elect for each Plan Year (or part Plan
Year under 2.2(a)) to defer a portion of regular or bonus compensation or
severance pay paid for the year or part year as follows:

               (a) The amount deferred may be expressed as a dollar amount, a
          percentage of regular salary, bonus or severance pay or a percentage
          of bonus over a certain dollar amount.

               (b) An expressed percentage shall apply to any pay changes in the
          year. A stated dollar amount shall not be affected by pay changes.
          Separate percentages or dollar amounts may be stated for salary,
          bonuses and severance pay.

               (c) A bonus deferral shall be governed by the election for the
          year for which the bonus is earned, not the year in which the bonus is
          paid.

          3.2 Deferral elections under the plan shall be made in writing to the
Committee on a form provided for that purpose. Elections shall be effective as
follows:

               (a) An election by a person first becoming eligible for
          participation shall be effective for the year the participant becomes
          eligible if made within 30 days after notice of eligibility.

               (b) Except as provided in (a), an election shall be effective for
          the Plan Year starting after the Plan Year in which the election is
          received by the Committee. An election shall be irrevocable for the
          first Plan Year for which it is effective.

               (c) An election may be effective indefinitely or for one or more
          years as specified in the election. A new election is required to
          continue deferrals after an election expires. A continuing election
          may be revoked or changed by a new election under (b).

          3.3 The Company shall match the amount deferred by each eligible
employee under 3.1 for each year as follows:

               (a) The Company's Match shall be 20 percent of the eligible
          employee's matchable deferrals under (b) for the year.

               (b) For (a), an eligible employee's deferrals shall be ignored
          for purposes of the Match to the extent they exceed 5 percent of the
          eligible employee's compensation.

     4.   Deferred Compensation and Matching Contribution Accounts

          4.1 Amounts of deferred compensation and the Company Match shall be
credited by Employer on its books to Deferred Compensation Accounts and Matching
Contribution Accounts.

               (a) The Committee shall adjust all accounts in accordance with
          the elected guidelines at reasonable times determined by the
          Committee.

               (b) When an account is in pay status, the Committee may require
          use of a cash equivalent guideline fund to the extent necessary to
          allow more frequent adjustments to coincide with the timing of pay
          distributions.

               (c) At any time when the Committee has established no guideline
          investment funds, each participant's accounts shall accrue interest at
          the Federal overnight funds rate.

          4.2 Employer shall make guideline investment credits to each
participant's accounts, until the account have been entirely paid out, as
follows:

               (a) The Committee shall establish guideline investment funds with
          investment objectives fixed by the Committee. The guideline funds may
          parallel the investment funds available under any irrevocable trust
          established under Section 5, below.

               (b) Each participant shall, under procedures established by the
          Committee, elect the guideline fund or funds for the participant's
          accounts under this plan. In the absence of a proper election, a
          balanced guideline fund will be used. Participant elections may be
          changed at such times and subject to such limits as may be fixed by
          the Committee.

          4.3 Each participant's accounts shall be maintained on the books of
the Employer until full payment has been made to the participant or
beneficiaries under Sections 7, 8 and 9 and the following shall apply subject to
5.3:

               (a) Employer shall not be obligated to set aside or earmark any
          funds for the accounts, which shall be purely a bookkeeping device.

               (b) All amounts of deferred compensation under this plan shall
          remain at all times the unrestricted assets of Employer, and the
          promise to pay the deferred amounts shall at all times remain unfunded
          as to the participants.

     5.   Irrevocable Trust

          5.1 Employer may but shall not be required to establish an irrevocable
trust to assume the liabilities to participants in certain circumstances, and
may transfer cash to such a trust.

          5.2 If Employer creates a trust under 5.1, assets transferred to the
trust shall be invested as follows:

               (a) Investment of such assets shall be at the absolute discretion
          of the Committee, the trustee, or both on a shared basis, as provided
          in the trust.

               (b) The guideline investment funds under 4.3 shall be purely for
          measuring the amount of time-value credits.

               (c) Neither employer nor the trustee shall be required to invest
          in such funds in accordance with participants' elections. Employer and
          the trustee may, however, choose, in their discretion, to invest in
          the elected guideline funds in accordance with the elections, and
          shall incur no liability for doing so.

          5.3 The trust under 5.1 shall be a grantor's trust and all assets held
in trust shall be assets of Employer subject to the trust terms. All assets of
the trust shall at all times be subject to the claims of creditors of Employer
in circumstances described in the trust. Participants will not receive a vested
priority interest in the trust assets ahead of such creditors. Participants'
interests in the trust will be governed by the trust terms at all times.

     6.   Time and Manner of Payment

          6.1 Deferred Compensation Accounts and Matching Contribution Accounts
shall become vested as follows:

               (a) The Matching Contribution Account shall be vested according
          to the eligible employee's Years of Service under the KinderCare
          Learning Centers, Inc. Savings and Investment Plan (Savings and
          Investment Plan) as follows:

               Years of Service                       Percent Vested

                 Less than 1                               -0-
                      1                                    20%
                      2                                    40%
                      3                                    60%
                      4                                    80%
                  5 or more                               100%

               (b) An eligible employee who, while employed by Employer, dies,
          becomes disabled as defined in the Savings and Investment Plan or
          reaches age 65 shall be fully vested.

               (c) Deferred Compensation Accounts shall be fully vested at all
          times.

          6.2 Subject to 6.5, 7.1 and 8, a participant's Payment Date shall be
one of the following as selected under 6.5:

               (a) The date the participant terminates employment under 6.7 for
          any reason.

               (b) The date the participant has terminated employment under 6.7
          and has reached an age up to 70 specified in the deferral election.

               (c) A specified date that is not earlier than one year after the
          close of the Plan Year to which the deferral election applies.

          6.3 A participant whose employment terminates before attainment of age
65 for any reason other than disability or death shall receive only the Deferred
Compensation Account and the vested portion of the Matching Contribution Account
under 6.1.

          6.4 A participant's vested accounts shall be paid in one of the
following ways as selected under 6.5 and 6.6:

               (a) In a lump sum within 30 days after the Payment Date.

               (b) In a lump sum within 30 days after the January 1 following
          the Payment Date.

               (c) In installments under 6.4 over a period up to 15 years
          starting the first of the month after the Payment Date.

               (d) In installments under 6.4 over a period up to 15 years
          starting the January 1 following the Payment Date.

          6.5 In the deferral election a participant shall select the Payment
Date under 6.2 and the form of payment under 6.4 for Deferred Compensation and
Matching Contribution Accounts, as follows:

               (a) Subject to (b), the selection shall be made in the deferral
          election.

               (b) If a participant has selected a lump sum under 6.4 (a) or
          (b), the selection may be changed to installment payments under 6.4
          (a) or (b) by a later irrevocable election made at least one year
          before the lump sum otherwise would have been payable.

               (c) Except as provided in (b), the selection shall be irrevocable
          for the portion of both accounts attributable to amounts subject to
          the deferral election.

               (d) If different selections are made in deferral elections
          applicable to different years, the accounts shall be appropriately
          divided for distribution.

          6.6 If installments are selected, the payout period shall be specified
in the deferral election. The installment size shall be fixed on the benefit
starting date and each later January 1 as though equal installments were to be
paid for the balance of the payment period including investment guideline
credits at a rate estimated as of the date of calculation. Installments may be
monthly, quarterly or annually, as elected by the participant before payments
start. If a participant fails to make an election within 30 days after
notification that an election must be made, installment payments shall
automatically be made on an annual basis.

          6.7 A participant terminates employment when no longer employed by an
Employer or an affiliate of an Employer. An affiliate is a corporation or other
entity that has been designated an affiliate for this purpose by the Committee.

          6.8 The Employer may withhold from any payments any income tax or
other amounts as required by law. Payments are generally not subject to FICA or
FUTA tax or related withholding.

     7.   Withdrawals

          7.1 Before the Payment Date, upon approval of the Committee, a
participant may withdraw up to 100 percent of the amount of the vested interest
under 6.1, as follows:

               (a) The amount reasonably necessary to meet an unforeseen
          emergency under 7.2, as determined by the Committee.

               (b) At the participant's option, up to 100 percent of the amount
          of the vested interest less a forfeiture of 10 percent of the amount
          withdrawn.

          7.2 "Unforseen emergency" means a participant's severe financial
hardship that cannot be met from other reasonably available resources and is
caused by one or more of the following:

               (a) Illness or accident of the participant or a dependent under
          Internal Revenue Code section 152(a).

               (b) Loss of the participant's property due to casualty.

               (c) Other similar extraordinary and unforeseeable circumstances
          arising as a result of events beyond the control of the participant.

          7.3 Other resources are reasonably available if assets can be
liquidated without that itself creating severe financial hardship, if insurance
or other reimbursement is available or if deferrals under this plan can be
stopped.

          7.4 The Committee shall establish guidelines and procedures for
implementing withdrawals. An application for withdrawal shall be written, shall
be signed by the participant and shall include a statement of the facts causing
the financial hardship and any other facts as may be required by the Committee.

          7.5 The withdrawal date shall be fixed by the Committee. The Committee
may require a minimum advance notice and may limit the amount, time and
frequency of withdrawals.

     8.   Death, Disability and Change in Control

          8.1 A Participant's accounts shall be payable under this Section as
follows, regardless of the provisions of Section 6:

               (a) In the event of the participant's death or disability.

               (b) If selected in the participant's deferral election, in the
          event of a change in control under 8.8.

          8.2 On death the accounts shall be paid under 8.3 within 30 days as
follows:

               (a) If the recipient is the surviving spouse and the participant
          had selected installment payout, by installments in accordance with
          the selection.

               (b) In all other cases, by a lump sum.

          8.3 An amount payable on death of a participant shall be paid to the
participant's beneficiary in the following order of priority:

               (a) To the surviving beneficiaries designated by the participant
          in writing to the Committee.

               (b) To the surviving beneficiaries designated by the participant
          to receive death benefits under any retirement plan maintained by the
          Company in which the participant participates.

               (c) To the participant's surviving spouse.

               (d) To the participant's surviving children in equal shares.

               (e) To the participant's estate.

          8.4 If a surviving spouse is receiving installments and dies when a
balance remains, the balance shall be paid in a lump sum to the spouse's estate.

          8.5 If a participant is temporarily disabled while employed or is
receiving long-term disability benefits under a plan described in 8.6 the
following shall apply:

               (a) The participant shall be treated as employed until age 65,
          and no payments will be made from the accounts before age 65 except as
          provided below.

               (b) If disability benefits stop and disability continues, the
          accounts shall be paid in accordance with the election under Section
          6.

               (c) If the participant dies, the provisions applicable to death
          shall be followed.

               (d) If the participant ceases to be disabled and does not resume
          employment, the provisions applicable to termination shall be
          followed.

          8.6 A participant is disabled if the Committee determines that either
of the following applies:

               (a) The participant is eligible to receive long-term disability
          benefits under a plan maintained by Employer or an affiliate or would
          have been eligible if covered by the plan.

               (b) In the absence of a plan under (a), the participant is
          permanently and totally disabled on the basis of criteria established
          by the Committee.

          8.7 In the event of a change in control, all unpaid deferred
compensation represented by both the Deferred Compensation Accounts and the
Matching Contribution Accounts, including deferred compensation being paid in
installments, shall be paid as soon as administratively feasible after the date
of the change in control.

          8.8 For 8.7, a change in control is the acquisition after August 1,
1997 by any person (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities and Exchange Act of 1934, as amended), together with affiliates and
associates of such person, whether by purchase, tender offer, exchange,
reclassification, recapitalization, merger or otherwise, of a sufficient number
of shares of the voting securities of the Company to provide such person with 50
percent or more of the combined voting power of the Company's then outstanding
voting securities.

     9.   Termination; Amendment

          9.1 The Company may terminate this plan effective the first day of any
month after notice to the participants or earlier as provided in 11.4. On
termination the following shall apply except as provided in 9.3:

               (a) Amounts deferred through the last month before the effective
          date of termination shall remain deferred and be credited to the
          accounts in accordance with the plan.

               (b) Deferral elections shall terminate as of the effective date
          of termination, and no further deferrals shall be allowed.

               (c) Amounts in an account shall remain to the credit of the
          account, shall continue to receive investment guideline credits and
          shall be paid out in accordance with Sections 6, 7 and 8.

          9.2 The Company may amend this plan effective the first day of any
month by notice to the participants. An amendment may be retroactive within the
Plan Year in which notice is given except that the right of participants to
defer compensation may not be reduced for the portion of the Plan Year through
the month in which the notice is given.

          9.3 If the Internal Revenue Service issues a final ruling that any
amounts deferred under this plan will be subject to current income tax, all
amounts to which the ruling is applicable shall be paid to the participants
within 30 days.

     10.  Claims Procedure

          10.1 Any person claiming a benefit, requesting an interpretation or
ruling under the plan, or requesting information under the plan shall present
the request in writing to the Committee, which shall respond in writing as soon
as practicable.

          10.2 If the claim or request is denied, the written notice of denial
shall state:

               (a) The reasons for denial, with specific reference to the plan
          provisions on which the denial is based.

               (b) A description of any additional materials or information
          required and an explanation of why it is necessary.

          10.3 The initial notice of denial shall normally be given within 90
days after receipt of the claim. If special circumstances require an extension
of time, the claimant shall be so notified and the time limit shall be 180 days.

          10.4 Any person whose claim or request is denied or who has not
received a response within 30 days may request review by notice in writing to
the Committee. The original decision shall be reviewed by the Committee which
may, but shall not be required to, grant the claimant a hearing. On review,
whether or not there is a hearing, the claimant may have representation, examine
pertinent documents and submit issues and comments in writing.

          10.5 The decision on review shall ordinarily be made within 60 days.
If an extension of time is required for a hearing or other special
circumstances, the claimant shall be notified and the time limit shall be 120
days. The decision shall be in writing and shall state the reasons and the
relevant plan provisions. Subject to 10.6, all decisions on review shall be
final and bind all parties concerned.

          10.6 If Employer creates a trust under 5.1, a decision of the
Committee shall be subject to review by the Trustee to the extent provided for
under the trust.

     11.  General Provisions

          11.1 If suit or action is instituted to enforce any rights under this
plan, the prevailing party may recover from the other party reasonable
attorneys' fees at trial and on any appeal.

          11.2 Any notice or directions under this plan shall be in writing and
shall be effective when actually delivered or, if mailed, when deposited postage
prepaid as first class. Mail shall be directed to the Company at the address
stated in this plan, to the participant at the address stated in the deferral
election or to such other address as a party may specify by notice to the other
parties. Notices to an Employer or the Committee shall be sent to the Company's
address.

          11.3 The rights of a participant under this plan are personal. Except
for the limited provisions of 8.3 and 11.5, no interest of a participant or any
beneficiary or representative of a participant may be directly or indirectly
transferred, encumbered, seized by legal process or in any other way subjected
to the claims of any creditor.

          11.4 If an Employer merges, consolidates, or otherwise reorganizes or
if its assets or business are acquired by another company, this plan shall
continue with respect to those eligible employees who continue in the employ of
the successor company. The transition of Employers shall not be considered a
termination of employment for purposes of this plan. In such an event, however,
a successor corporation may terminate this plan as to its employees on the
effective date of the succession by notice to eligible employees within 30 days
after the succession.

          11.5 The Committee may decide that because of the mental or physical
condition of a person entitled to payments, or because of other relevant
factors, it is in the person's best interest to make payments to others for the
benefit of the person entitled to payment. In that event the Committee may in
its discretion direct that payments be made to one or more of the following:

               (a) To a parent or spouse or a child of legal age.

               (b) To a legal guardian.

               (c) To one furnishing maintenance, support, or hospitalization.

     12.  Effective Date

          This plan Restatement shall be effective as of January 1, 1999.

                        KinderCare Learning Centers, Inc.

                                            By EDWARD L. BREWINGTON
                                               ---------------------------------
                                            Executed: February 11, 1999

                                       9

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