Document:

LNT Broad-Based Equity Plan

                           Effective October 12, 2000

                  1. Purpose.  The purpose of this LNT  Broad-Based  Equity Plan
(the  "Plan") is to aid  Linens 'n Things,  Inc.,  a Delaware  corporation  (the
"Company"),  in  attracting,  retaining,  motivating  and  rewarding the regular
full-time   employees  of  the  Company  and  its  subsidiaries  and  affiliates
(expressly excluding any such employees who are "officers" of the Company within
the meaning of Rule 312.04(g) of the New York Stock Exchange Rules), in order to
provide  equitable  and  competitive  compensation  opportunities,  to recognize
individual  contributions  and reward  achievement of Company goals, and promote
the  creation  of  long-term  value for  stockholders  by closely  aligning  the
interests  of  Participants  with  those of  stockholders.  The Plan  authorizes
stock-based and cash-based incentives for Participants.

                  There is being reserved up to a maximum of 4,000,000 shares of
common stock of the Company  (subject to adjustment under Section 11(c)) for use
under  the Plan  from  time to time  over the ten year  term of the  Plan.  Such
available  shares are to be used from time to time under the Plan only if and at
such times as the Compensation Committee of the Board of Directors determines it
to be appropriate.  The Compensation  Committee shall not be required to use all
such  available   shares  under  the  Plan,  shall  administer  the  Plan  as  a
"broad-based  plan"  under Rule 312 of the New York Stock  Exchange  Rules as in
effect on the effective date of the Plan, and shall take into account, in making
Awards  under the Plan,  any equity  awards  granted or to be granted  under the
Linens 'n Things 2000 Stock Award and Incentive Plan.

                  2. Definitions.  In addition to the terms defined in Section 1
above and  elsewhere in the Plan,  the following  capitalized  terms used in the
Plan have the respective meanings set forth in this Section:

                  (a) "Award" means any Option, SAR, Restricted Stock,  Deferred
Stock,  Stock  granted  as a  bonus  or  in  lieu  of  another  award,  Dividend
Equivalent,  Other Stock-Based  Award, or Performance  Award,  together with any
related right or interest, granted to a Participant under the Plan.

                  (b)  "Beneficiary"  means  the  legal  representatives  of the
Participant's estate entitled by will or the laws of descent and distribution to
receive the benefits under a  Participant's  Award upon a  Participant's  death,
provided that, if and to the extent  authorized by the Committee,  a Participant
may be  permitted to designate a  Beneficiary,  in which case the  "Beneficiary"
instead will be the person, persons, trust or trusts (if any are then surviving)
which have been  designated by the Participant in his or her most recent written
beneficiary  designation  filed  with the  Committee  to  receive  the  benefits
specified under the Participant's  Award upon such Participant's  death.  Unless
otherwise  determined by the Committee,  any designation of a Beneficiary  other
than a  Participant's  spouse  shall be subject to the  written  consent of such
spouse.

                  (c) "Board" means the Company's Board of Directors.

                  (d) "Change in Control"  and related  terms have the  meanings
specified in Section 9.

                  (e)  "Code"  means  the  Internal  Revenue  Code of  1986,  as
amended.  References  to any  provision of the Code or  regulation  (including a
proposed  regulation)  thereunder  shall  include any successor  provisions  and
regulations.

                  (f)  "Committee"  means a committee  of two or more  directors
designated  by the  Board to  administer  the  Plan;  provided,  however,  that,
directors appointed or serving as members of a Board committee designated as the
Committee  shall not be employees of the Company or any subsidiary or affiliate.
In appointing members of the Committee, the Board will consider whether a member
is or will be a Qualified Member. The full Board may perform any function of the
Committee  hereunder,  in which  case the term  "Committee"  shall  refer to the
Board.

                  (g) "Deferred  Stock" means a right,  granted to a Participant
under Section 6(e), to receive Stock or other Awards or a combination thereof at
the end of a specified deferral period.

                  (h)  "Dividend   Equivalent"  means  a  right,  granted  to  a
Participant  under Section 6(g), to receive cash,  Stock,  other Awards or other
property equal in value to all or a specified portion of the dividends paid with
respect to a specified number of shares of Stock.

                  (i)  "Effective  Date" means the effective  date  specified in
Section 11(o).

                  (j) "Eligible Person" means each full-time regular employee of
the Company,  except that such term shall not include any  individual  who is an
"officer"  within the meaning of Rule  312.04(g) of the New York Stock  Exchange
Rules.

                  (k) "Fair Market  Value" means the fair market value of Stock,
Awards or other  property as  determined  by the  Committee or under  procedures
established by the Committee.  Unless otherwise determined by the Committee, the
Fair Market  Value of Stock as of any given date shall be the closing sale price
per share of Stock reported on a consolidated basis for securities listed on the
principal  stock  exchange  or market on which Stock is traded on the date as of
which such value is being  determined  or, if there is no sale on that day, then
on the last previous day on which a sale was reported.

                  (l) "Option"  means a right,  granted to a  Participant  under
Section  6(b),  to purchase  Stock or other  Awards at a specified  price during
specified time periods.

                  (m)  "Other  Stock-Based  Awards"  means  Awards  granted to a
Participant under Section 6(h).

                  (n) "Participant" means a person who has been granted an Award
under the Plan which remains outstanding, including a person who is no longer an
Eligible Person.

                  (o) "Performance Award" means a conditional right,  granted to
a Participant  under Sections 6(i) and 7, to receive cash, Stock or other Awards
or payments,  as determined by the Committee,  based upon  performance  criteria
specified by the Committee.

                  (p) "Qualified  Member" means a member of the Committee who is
a  "Non-Employee  Director"  within  the  meaning  of  Rule  16b-3(b)(3)  of the
Securities  Exchange Act of 1934 and an "outside director" within the meaning of
Regulation 1.162-27 under Code Section 162(m).

                  (q)  "Restricted  Stock" means Stock  granted to a Participant
under  Section  6(d) which is subject to certain  restrictions  and to a risk of
forfeiture.

                  (r) "Stock"  means the Company's  Common Stock,  and any other
equity  securities of the Company that may be substituted or  resubstituted  for
Stock pursuant to Section 11(c).

                  (s) "Stock Appreciation Rights" or "SAR" means a right granted
to a Participant under Section 6(c).

                  3.       Administration.

                  (a) Authority of the Committee. The Plan shall be administered
by the  Committee,  which  shall  have  full and final  authority,  in each case
subject to and consistent  with the  provisions of the Plan, to select  Eligible
Persons to become  Participants;  to grant  Awards;  to  determine  the type and
number of Awards,  the dates on which Awards may be  exercised  and on which the
risk of  forfeiture  or  deferral  period  relating  to  Awards  shall  lapse or
terminate, the acceleration of any such dates, the expiration date of any Award,
whether,  to what extent,  and under what circumstances an Award may be settled,
or the exercise price of an Award may be paid, in cash, Stock,  other Awards, or
other  property,  and  other  terms and  conditions  of,  and all other  matters
relating to,  Awards;  to prescribe  documents  evidencing  or setting  terms of
Awards  (such  Award  documents  need not be  identical  for each  Participant),
amendments thereto, and rules and regulations for the administration of the Plan
and amendments  thereto;  to construe and interpret the Plan and Award documents
and correct defects, supply omissions or reconcile  inconsistencies therein; and
to make  all  other  decisions  and  determinations  as the  Committee  may deem
necessary  or advisable  for the  administration  of the Plan.  Decisions of the
Committee  with respect to the  administration  and  interpretation  of the Plan
shall be final, conclusive, and binding upon all persons interested in the Plan,
including Participants, Beneficiaries, transferees under Section 11(b) and other
persons claiming rights from or through a Participant, and stockholders.

                  (b) Manner of Exercise  of  Committee  Authority.  At any time
that a member of the  Committee  is not a  Qualified  Member,  any action of the
Committee relating to an Award may be taken by a subcommittee, designated by the
Committee or the Board,  composed solely of two or more Qualified Members.  Such
action,  authorized  by  such  a  subcommittee  or by  the  Committee  upon  the
abstention or recusal of a non-Qualified  Member(s),  shall be the action of the
Committee for purposes of the Plan.  The express grant of any specific  power to
the  Committee,  and the  taking of any  action by the  Committee,  shall not be
construed as limiting any power or authority of the Committee. The Committee may
delegate to officers or managers of the Company or any  subsidiary or affiliate,
or committees  thereof,  the  authority,  subject to such terms as the Committee
shall determine, to perform such functions as the Committee may determine.

                  (c)  Limitation  of  Liability.  The Committee and each member
thereof, and any person acting pursuant to authority delegated by the Committee,
shall be  entitled,  in good  faith,  to rely or act upon  any  report  or other
information furnished by any executive officer, other officer or employee of the
Company or a  subsidiary  or  affiliate,  the  Company's  independent  auditors,
consultants  or any other agents  assisting in the  administration  of the Plan.
Members of the Committee,  any person acting pursuant to authority  delegated by
the  Committee,  and any officer or employee of the Company or a  subsidiary  or
affiliate  acting at the  direction or on behalf of the  Committee or a delegee,
shall not be personally liable for any action or determination  taken or made in
good faith with respect to the Plan, and shall, to the extent  permitted by law,
be fully  indemnified  and  protected  by the Company  with  respect to any such
action or determination.

                  (d)  NYSE  Compliance.   The  Plan  will  be  administered  in
accordance with the "broad based" plan  requirements of Rule 312 of the New York
Stock Exchange Rules as in effect on the Effective Date.

                  4.       Stock Subject to Plan.

                  (a) Overall Number of Shares  Available for Delivery.  Subject
to adjustment as provided in Section 11(c),  the total number of shares of Stock
reserved and  available  for delivery in  connection  with Awards under the Plan
shall be 4,000,000; provided, however, that the total number of shares which may
be issued and delivered in  connection  with Awards other than Options shall not
exceed  1,000,000  shares  reserved  under the Plan,  subject to  adjustment  as
provided in Section 11(c).  Any shares of Stock  delivered  under the Plan shall
consist of authorized and unissued shares or treasury shares.

                  (b) Share Counting Rides.  The Committee may adopt  reasonable
counting procedures to ensure appropriate  counting,  avoid double counting (as,
for example, in the case of tandem or substitute awards) and make adjustments if
the  number of shares of Stock  actually  delivered  differs  from the number of
shares  previously  counted in connection  with an Award.  Shares  subject to an
Award under the Plan that is canceled,  expired,  forfeited,  settled in cash or
otherwise  terminated without a delivery of shares to the Participant will again
be available for Awards, and shares withheld in payment of the exercise price or
taxes relating to an Award and shares equal to the number surrendered in payment
of any  exercise  price  or  taxes  relating  to an Award  shall  be  deemed  to
constitute  shares not  delivered to the  Participant  and shall be deemed to be
available  for  Awards  under the Plan.  In  addition,  in the case of any Award
granted in  substitution  for an award of a company or business  acquired by the
Company or a subsidiary  or  affiliate,  shares issued or issuable in connection
with such  substitute  Award  shall not be counted  against the number of shares
reserved under the Plan, but shall be available  under the Plan by virtue of the
Company's  assumption  of the plan or  arrangement  of the  acquired  company or
business.

                  5.  Eligibility.  Awards may be granted under the Plan only to
Eligible Persons.

                  6.       Specific Terms of Awards.

                  (a) General. Awards may be granted on the terms and conditions
set forth in this Section 6. In addition,  the Committee may impose on any Award
or the exercise thereof,  at the date of grant or thereafter (subject to Section
11(e)),  such  additional  terms  and  conditions,  not  inconsistent  with  the
provisions  of the Plan,  as the  Committee  shall  determine,  including  terms
requiring  forfeiture  of Awards in the event of  termination  of  employment or
service by the Participant and terms  permitting a Participant to make elections
relating  to his or her  Award.  The  Committee  shall  retain  full  power  and
discretion  with  respect  to any  term or  condition  of an  Award  that is not
mandatory  under the Plan.  The  Committee  shall  require the payment of lawful
consideration  for an Award to the extent  necessary to satisfy the requirements
of the Delaware General  Corporation  Law, and may otherwise  require payment of
consideration for an Award except as limited by the Plan.

                  (b)   Options.   The   Committee   is   authorized   to  grant
non-qualified Options to Participants on the following terms and conditions:

                           (i) Exercise  Price.  The exercise price per share of
         Stock purchasable under an Option shall be determined by the Committee,
         provided  that  such  exercise  price  shall be not less  than the Fair
         Market  Value of a share of Stock on the date of grant of such  Option,
         subject to Sections 6(f) and 8(a).

                           (ii) Option Term;  Time and Method of  Exercise.  The
         Committee shall determine the term of each Option.  The Committee shall
         determine the time or times at which or the  circumstances  under which
         an Option  may be  exercised  in whole or in part  (including  based on
         achievement of performance  goals and/or future service  requirements),
         the  methods by which such  exercise  price may be paid or deemed to be
         paid  and  the  form  of  such  payment  (subject  to  Section  11(j)),
         including,  without  limitation,  cash,  Stock,  other Awards or awards
         granted  under  other  plans  of  the  Company  or  any  subsidiary  or
         affiliate,  or other property  (including  notes and other  contractual
         obligations of Participants  to make payment on a deferred basis,  such
         as through "cashless exercise" arrangements, to the extent permitted by
         applicable  law),  and the  methods by or forms in which  Stock will be
         delivered  or deemed to be  delivered  in  satisfaction  of  Options to
         Participants  (including  deferred delivery of shares  representing the
         Option  "profit," at the election of the  Participant or as mandated by
         the  Committee,  with such  deferred  shares  subject  to any  vesting,
         forfeiture or other terms as the Committee may specify).

                  (c) Stock Appreciation  Rights. The Committee is authorized to
grant SARs to Participants on the following terms and conditions:

                           (i)  Right to  Payment.  A SAR  shall  confer  on the
         Participant  to whom it is granted a right to  receive,  upon  exercise
         thereof,  the excess of (A) the Fair Market Value of one share of Stock
         on the date of exercise  (or, in the case of a "Limited  SAR," the Fair
         Market Value determined by reference to the Change in Control Price, as
         defined  under Section 9(c) hereof) over (B) the grant price of the SAR
         as determined by the Committee.

                           (ii) Other Terms.  The Committee  shall  determine at
         the  date of grant or  thereafter,  the time or times at which  and the
         circumstances  under which a SAR may be  exercised  in whole or in part
         (including  based on  achievement  of  performance  goals and/or future
         service  requirements),  the method of exercise,  method of settlement,
         form of  consideration  payable  in  settlement,  method by or forms in
         which  Stock  will  be   delivered   or  deemed  to  be   delivered  to
         Participants,  and  whether or not a SAR shall be  free-standing  or in
         tandem or combination with any other Award.  Limited SARs that may only
         be exercised in  connection  with a Change in Control or other event as
         specified  by  the  Committee  may  be  granted  on  such  terms,   not
         inconsistent with this Section 6(c), as the Committee may determine.

                  (d)  Restricted  Stock.  The  Committee is authorized to grant
Restricted Stock to Participants on the following terms and conditions:

                           (i) Grant and Restrictions. Restricted Stock shall be
         subject to such restrictions on transferability, risk of forfeiture and
         other  restrictions,  if  any,  as  the  Committee  may  impose,  which
         restrictions  may lapse  separately  or in  combination  at such times,
         under such circumstances (including based on achievement of performance
         goals and/or future  service  requirements),  in such  installments  or
         otherwise  and under  such other  circumstances  as the  Committee  may
         determine  at the date of grant or  thereafter.  Except  to the  extent
         restricted under the terms of the Plan and any Award document  relating
         to the Restricted Stock, a Participant  granted  Restricted Stock shall
         have all of the rights of a  stockholder,  including  the right to vote
         the  Restricted  Stock  and the  right  to  receive  dividends  thereon
         (subject to any mandatory  reinvestment or other requirement imposed by
         the Committee).

                           (ii)  Forfeiture.  Except as otherwise  determined by
         the  Committee,  upon  termination  of employment or service during the
         applicable  restriction  period,  Restricted Stock that is at that time
         subject  to  restrictions  shall be  forfeited  and  reacquired  by the
         Company; provided that the Committee may provide, by rule or regulation
         or in any Award document, or may determine in any individual case, that
         restrictions or forfeiture conditions relating to Restricted Stock will
         lapse  in  whole or in part,  including  in the  event of  terminations
         resulting from specified causes.

                           (iii)   Certificates  for  Stock.   Restricted  Stock
         granted under the Plan may be evidenced in such manner as the Committee
         shall  determine.  If certificates  representing  Restricted  Stock are
         registered  in the name of the  Participant,  the Committee may require
         that such  certificates  bear an  appropriate  legend  referring to the
         terms, conditions and restrictions applicable to such Restricted Stock,
         that the Company retain physical  possession of the  certificates,  and
         that the Participant deliver a stock power to the Company,  endorsed in
         blank, relating to the Restricted Stock.

                           (iv)  Dividends  and Splits.  As a  condition  to the
         grant of an Award of Restricted  Stock,  the Committee may require that
         any dividends  paid on a share of Restricted  Stock shall be either (A)
         paid with respect to such Restricted Stock at the dividend payment date
         in cash, in kind, or in a number of shares of unrestricted Stock having
         a Fair  Market  Value  equal to the  amount of such  dividends,  or (B)
         automatically  reinvested  in  additional  Restricted  Stock or held in
         kind,  which  shall be  subject  to the same  terms as  applied  to the
         original  Restricted  Stock to which it relates,  or (C) deferred as to
         payment,  either as a cash deferral or with the amount or value thereof
         automatically  deemed  reinvested  in shares of Deferred  Stock,  other
         Awards  or other  investment  vehicles,  subject  to such  terms as the
         Committee  shall  determine or permit a  Participant  to elect.  Unless
         otherwise determined by the Committee,  Stock distributed in connection
         with a Stock split or Stock dividend, and other property distributed as
         a dividend,  shall be subject to restrictions  and a risk of forfeiture
         to the same extent as the  Restricted  Stock with respect to which such
         Stock or other property has been distributed.

                  (e)  Deferred  Stock.  The  Committee is  authorized  to grant
Deferred Stock to Participants, which are rights to receive Stock, other Awards,
or a combination  thereof at the end of a specified deferral period,  subject to
the following terms and conditions:

                           (i) Award and  Restrictions.  Issuance  of Stock will
         occur upon expiration of the deferral period  specified for an Award of
         Deferred Stock by the Committee (or, if permitted by the Committee,  as
         elected by the  Participant).  In  addition,  Deferred  Stock  shall be
         subject to such restrictions on transferability, risk of forfeiture and
         other  restrictions,  if  any,  as  the  Committee  may  impose,  which
         restrictions  may lapse at the expiration of the deferral  period or at
         earlier  specified times (including based on achievement of performance
         goals  and/or   future   service   requirements),   separately   or  in
         combination,  in  installments  or  otherwise,  and  under  such  other
         circumstances  as the  Committee  may determine at the date of grant or
         thereafter. Deferred Stock may be satisfied by delivery of Stock, other
         Awards,  or a  combination  thereof  (subject  to  Section  11(j)),  as
         determined by the Committee at the date of grant or thereafter.

                           (ii)  Forfeiture.  Except as otherwise  determined by
         the  Committee,  upon  termination  of employment or service during the
         applicable  deferral  period or  portion  thereof  to which  forfeiture
         conditions  apply (as  provided in the Award  document  evidencing  the
         Deferred  Stock),  all  Deferred  Stock that is at that time subject to
         such  forfeiture  conditions  shall  be  forfeited;  provided  that the
         Committee may provide,  by rule or regulation or in any Award document,
         or  may  determine  in  any  individual  case,  that   restrictions  or
         forfeiture conditions relating to Deferred Stock will lapse in whole or
         in  part,  including  in  the  event  of  terminations  resulting  from
         specified causes.

                           (iii)   Dividend   Equivalents.    Unless   otherwise
         determined  by the  Committee,  Dividend  Equivalents  on the specified
         number of shares of Stock  covered by an Award of Deferred  Stock shall
         be either (A) paid with respect to such Deferred  Stock at the dividend
         payment date in cash or in shares of  unrestricted  Stock having a Fair
         Market  Value equal to the amount of such  dividends,  or (B)  deferred
         with respect to such Deferred Stock,  either as a cash deferral or with
         the  amount  or  value  thereof   automatically  deemed  reinvested  in
         additional  Deferred Stock,  other Awards or other investment  vehicles
         having a Fair Market  Value equal to the amount of such  dividends,  as
         the Committee shall determine or permit a Participant to elect.

                  (f)  Bonus  Stock  and  Awards  in  Lieu of  Obligations.  The
Committee is  authorized  to grant Stock as a bonus,  or to grant Stock or other
Awards in lieu of obligations of the Company or a subsidiary or affiliate to pay
cash  or  deliver  other  property  under  the  Plan or  under  other  plans  or
compensatory  arrangements,  subject to such terms as shall be determined by the
Committee.

                  (g) Dividend Equivalents. The Committee is authorized to grant
Dividend  Equivalents  to a  Participant,  entitling the  Participant to receive
cash, Stock,  other Awards, or other property  equivalent to all or a portion of
the  dividends  paid  with  respect  to a  specified  number of shares of Stock.
Dividend  Equivalents may be awarded on a  free-standing  basis or in connection
with another Award. The Committee may provide that Dividend Equivalents shall be
paid or distributed  when accrued or shall be deemed to have been  reinvested in
additional  Stock,  Awards,  or  other  investment  vehicles,   and  subject  to
restrictions on transferability, risks of forfeiture and such other terms as the
Committee may specify.

                  (h) Other  Stock-Based  Awards.  The Committee is  authorized,
subject to limitations under applicable law, to grant to Participants such other
Awards  that may be  denominated  or payable  in,  valued in whole or in part by
reference  to, or  otherwise  based on, or related to, Stock or factors that may
influence the value of Stock,  including,  without  limitation,  convertible  or
exchangeable  debt  securities,  other rights  convertible or exchangeable  into
Stock,  purchase rights for Stock, Awards with value and payment contingent upon
performance  of the  Company or  business  units  thereof  or any other  factors
designated by the Committee, and Awards valued by reference to the book value of
Stock or the value of securities of or the performance of specified subsidiaries
or affiliates or other business  units.  The Committee shall determine the terms
and  conditions  of such  Awards.  Stock  delivered  pursuant to an Award in the
nature of a purchase  right  granted  under this Section 6(h) shall be purchased
for such  consideration,  paid for at such times,  by such methods,  and in such
forms, including, without limitation, cash, Stock, other Awards, notes, or other
property,  as the Committee shall  determine.  Cash awards,  as an element of or
supplement  to any other Award under the Plan,  may also be granted  pursuant to
this Section 6(h).

                  (i) Performance  Awards.  Performance  Awards,  denominated in
cash or in Stock or other Awards,  may be granted by the Committee in accordance
with Section 7.

                  7. Performance Awards,  Including Annual Incentive Awards. The
Committee is authorized to grant Performance  Awards on the terms and conditions
specified in this Section 7.  Performance  Awards may be  denominated  as a cash
amount,  number of shares of Stock,  or  specified  number of other Awards (or a
combination) which may be earned upon achievement or satisfaction of performance
conditions  specified by the Committee.  In addition,  the Committee may specify
that any other Award shall  constitute a Performance  Award by conditioning  the
right of a Participant to exercise the Award or have it settled,  and the timing
thereof, upon achievement or satisfaction of such performance  conditions as may
be specified by the Committee.  The Committee may use such business criteria and
other  measures of performance as it may deem  appropriate in  establishing  any
performance  conditions,  and may exercise its  discretion to reduce or increase
the amounts payable under any Award subject to performance conditions.

                  8.       Certain Provisions Applicable to Awards.

                  (a) Stand-Alone,  Additional,  Tandem,  and Substitute Awards.
Awards  granted  under the Plan may,  in the  discretion  of the  Committee,  be
granted  either alone or in addition to, in tandem with, or in  substitution  or
exchange  for, any other Award or any award  granted  under  another plan of the
Company,  any subsidiary or affiliate,  or any business entity to be acquired by
the Company or a subsidiary or affiliate, or any other right of a Participant to
receive payment from the Company or any subsidiary or affiliate.  Awards granted
in addition to or in tandem with other Awards or awards may be granted either as
of the same time as or a different  time from the grant of such other  Awards or
awards.  Subject to Section 11(j), the Committee may determine that, in granting
a new Award,  the  in-the-money  value of any surrendered  Award or award may be
applied to reduce the exercise  price of any Option,  grant price of any SAR, or
purchase price of any other Award.

                  (b) Term of Awards.  The term of each Award  shall be for such
period as may be determined by the Committee.

                  (c)  Form and  Timing  of  Payment  under  Awards;  Deferrals.
Subject to the terms of the Plan  (including  Section  11(j)) and any applicable
Award document,  payments to be made by the Company or a subsidiary or affiliate
upon the exercise of an Option or other Award or  settlement  of an Award may be
made  in  such  forms  as the  Committee  shall  determine,  including,  without
limitation,  cash,  Stock,  other Awards or other  property and may be made in a
single  payment  or  transfer,  in  installments,  or on a deferred  basis.  The
settlement  of any Award may be  accelerated,  and cash paid in lieu of Stock in
connection  with such  settlement,  in the  discretion  of the Committee or upon
occurrence  of  one  or  more  specified  events  (subject  to  Section  11(j)).
Installment  or deferred  payments may be required by the Committee  (subject to
Section  11(e)) or  permitted at the  election of the  Participant  on terms and
conditions  established  by  the  Committee.   Payments  may  include,   without
limitation,  provisions for the payment or crediting of reasonable  interest oil
installment  or  deferred  payments  or  the  grant  or  crediting  of  Dividend
Equivalents  or other  amounts in respect of  installment  or deferred  payments
denominated in Stock.

                  (d) Loan  Provisions.  With the consent of the Committee,  and
subject at all times to, and only to the extent, if any,  permitted under and in
accordance  with,  laws  and  regulations  and  other  binding   obligations  or
provisions  applicable  to the  Company,  the  Company may make,  guarantee,  or
arrange for a loan or loans to a Participant with respect to the exercise of any
Option or other payment in connection with any Award, including the payment by a
Participant of any or all federal,  state, or local income or other taxes due in
connection with any Award. Subject to such limitations, the Committee shall have
full  authority  to  decide  whether  to make a loan or loans  hereunder  and to
determine the amount, terms, and provisions of any such loan or loans, including
the interest  rate,  if any, to be charged in respect of any such loan or loans,
whether  the  loan or  loans  are to be with or  without  recourse  against  the
borrower,  the terms on which the loan is to be repaid and  conditions,  if any,
under which the loan or loans may be forgiven.

                  (e) Limitation on Vesting of Certain Awards.  Restricted Stock
will  vest  over a  minimum  period  of three  years  except  in the  event of a
Participant's death, disability,  or retirement,  or in the event of a Change in
Control or other  special  circumstances.  The  foregoing  notwithstanding,  (i)
Restricted  Stock as to which  either the grant or  vesting  is based on,  among
other things,  the achievement of one or more performance  conditions  generally
will  vest  over a  minimum  period  of  one  year  except  in  the  event  of a
Participant's death, disability,  or retirement,  or in the event of a Change in
Control or other special circumstances, and (ii) up to 5% of the shares of Stock
authorized under the Plan may be granted as Restricted Stock without any minimum
vesting  requirements.  For  purposes  of  this  Section  8(e),  vesting  over a
three-year  period or one-year  period will include  periodic  vesting over such
period if the rate of such vesting is proportional throughout such period.

                  9.       Change in Control.

                  (a) Effect of "Change in  Control"  on  Non-Performance  Based
Awards.  In the event of a "Change in Control," the following  provisions  shall
apply to non-performance based Awards,  including Awards as to which performance
conditions  previously have been satisfied or are deemed satisfied under Section
9(b), unless otherwise provided by the Committee in the Award document:

                           (i) All deferral of settlement, forfeiture conditions
         and other  restrictions  applicable  to Awards  granted  under the Plan
         shall  lapse and such Awards  shall be fully  payable as of the time of
         the  Change  in  Control   without   regard  to  deferral  and  vesting
         conditions,  except to the extent of any waiver by the  Participant  or
         other express election to defer beyond it Change in Control and subject
         to applicable restrictions set forth in Section 11(a);

                           (ii) Any Award  carrying a right to exercise that was
         not previously  exercisable  and vested shall become fully  exercisable
         and  vested as of the time of the Change in  Control  and shall  remain
         exercisable and vested for the balance of the stated term of such Award
         without  regard to any  termination  of  employment  or  service by the
         Participant  other than a  termination  for  "cause" (as defined in any
         employment or severance  agreement between the Company or it subsidiary
         or affiliate and the Participant then in effect or, if none, as defined
         by the  Committee  and in effect at the time of the Change in Control),
         subject only to applicable restrictions set forth in Section 11(a); and

                           (iii) The Committee may, in its discretion, determine
         to extend to any  Participant  who holds an Option  the right to elect,
         during the 60-day period  immediately  following the Change in Control,
         in lieu of acquiring  the shares of Stock  covered by such  Option,  to
         receive  in cash the  excess of the  Change in  Control  Price over the
         exercise  price of such Option,  multiplied  by the number of shares of
         Stock  covered by such  Option,  and to extend to any  Participant  who
         holds other types of Awards  denominated  in shares the right to elect,
         during the 60-day period  immediately  following the Change in Control,
         in lieu of  receiving  the shares of Stock  covered by such  Award,  to
         receive in cash the Change in Control Price multiplied by the number of
         shares of Stock covered by such Award.

                  (b) Effect of "Change in Control" on Performance-Based Awards.
In the event of a "Change in  Control,"  with  respect to an  outstanding  Award
subject to achievement of performance  goals and  conditions,  such  performance
goals and conditions  shall be deemed to be met or exceeded if and to the extent
so provided by the Committee in the Award document governing such Award or other
agreement with the Participant.

                  (c)  Definition  of "Change in Control." A "Change in Control"
shall be deemed to have occurred if, after the Effective Date,  there shall have
occurred any of the following:

                           (i) any Person  (other than the Company,  any trustee
         or other fiduciary  holding  securities under any employee benefit plan
         of the Company,  or any company owned,  directly or indirectly,  by the
         stockholders of the Company in  substantially  the same  proportions as
         their  ownership  of the  common  stock  of the  Company)  becomes  the
         beneficial  owner  (except  that a  Person  shall be  deemed  to be the
         beneficial  owner of all shares  that any such  Person has the right to
         acquire  pursuant to any agreement or  arrangement  or upon exercise of
         conversion rights, warrants or options or otherwise,  without regard to
         the sixty day period referred to in Rule 13d-3 under the Exchange Act),
         directly or indirectly, of securities of the Company or any Significant
         Subsidiary (as defined below), representing 30% or more of the combined
         voting power of the  Company's or such  subsidiary's  then  outstanding
         securities;

                           (ii) during any period of two consecutive  years (not
         including  any period prior to the  adoption of the Plan),  individuals
         who at the beginning of such period  constitute the Board,  and any new
         director (other than a director  designated by a person who has entered
         into an agreement with the Company to effect a transaction described in
         clause (i),  (iii),  or (iv) of this  paragraph)  whose election by the
         Board or  nomination  for election by the  Company's  stockholders  was
         approved by a vote of at least  two-thirds of the directors  then still
         in office who either were  directors  at the  beginning of the two-year
         period or whose  election or nomination  for election was previously so
         approved but  excluding  for this  purpose any such new director  whose
         initial  assumption of office occurs as a result of either an actual or
         threatened  election  contest (as such terms are used in Rule 14a-11 of
         Regulation 14A  promulgated  under the Exchange Act) or other actual or
         threatened  solicitation  of proxies or  consents by or on behalf of an
         individual, corporation,  partnership, group, associate or other entity
         or Person other than the Board,  cease for any reason to  constitute at
         least a majority of the Board,

                           (iii) the  consummation of a merger or  consolidation
         of the Company or any subsidiary  owning  directly or indirectly all or
         substantially  all  of  the  consolidated  assets  of  the  Company  (a
         "Significant  Subsidiary")  with any other  corporation,  other  than a
         merger or consolidation  which would result in the voting securities of
         the Company or a Significant Subsidiary  outstanding  immediately prior
         thereto continuing to represent (either by remaining  outstanding or by
         being  converted  into voting  securities of the surviving or resulting
         entity) more than 50% of the combined  voting power of the surviving or
         resulting  entity   outstanding   immediately   after  such  merger  or
         consolidation;

                           (iv) the stockholders of the Company or any affiliate
         approve  a plan or  agreement  for the  sale or  disposition  of all or
         substantially all of the consolidated assets of the Company (other than
         such a sale or disposition  immediately after which such assets will be
         owned  directly or  indirectly  by the  stockholders  of the Company in
         substantially  the same  proportions  as their  ownership of the common
         stock of the Company  immediately prior to such sale or disposition) in
         which case the Board shall  determine the effective  date of the Change
         in Control resulting therefrom; or

                           (v)  any   other   event   occurs   which  the  Board
         determines, in its discretion,  would materially alter the structure of
         the Company or its ownership.

                  (d)  Definition  of "Change in Control  Price." The "Change in
Control  Price" means an amount in cash equal to the higher of (i) the amount of
cash and fair market value of property  that is the highest price per share paid
(including  extraordinary dividends) in any transaction triggering the Change in
Control or any  liquidation  of shares  following  a sale of  substantially  all
assets of the  Company,  or (ii) the highest  Fair Market Value per share at any
time during the 60-day period  preceding and 60-day period  following the Change
in Control.

                  10.      Additional Award Forfeiture Provisions.

                  (a)  Forfeiture of Options and Other Awards and Gains Realized
Upon Prior Option Exercises or Award Settlements. Unless otherwise determined by
the Committee,  each Award granted  hereunder  shall be subject to the following
additional  forfeiture  conditions,  to which the  Participant,  by accepting an
Award hereunder,  agrees.  If any of the events  specified in Section  10(b)(i),
(ii), or (iii) occurs (a "Forfeiture Event"),  all of the following  forfeitures
will result:

                           (i) The unexercised portion of the Option, whether or
         not vested,  and any other Award not then settled  (except for an Award
         that has not been  settled  solely due to an  elective  deferral by the
         Participant  and  otherwise  is not  forfeitable  in the  event  of any
         termination  of  service  of  the  Participant)   will  be  immediately
         forfeited and canceled upon the occurrence of the Forfeiture Event; and

                           (ii) The  Participant  will be  obligated to repay to
         the Company,  in cash,  within five  business days after demand is made
         therefor  by the  Company,  the total  amount of Award Gain (as defined
         herein)  realized by the Participant upon each exercise of an Option or
         settlement  of an Award  (regardless  of any  elective  deferral)  that
         occurred on or after (A) the date that is twenty-four (24) months prior
         to the occurrence of the  Forfeiture  Event,  if the  Forfeiture  Event
         occurred  while  the  Participant  was  employed  by the  Company  or a
         subsidiary  or  affiliate,  or (B) the date  that is  twenty-four  (24)
         months prior to the date the Participant's employment by the Company or
         a subsidiary or affiliate terminated,  if the Forfeiture Event occurred
         after the  Participant  ceased to be so employed.  For purposes of this
         Section,  the term  "Award  Gain"  shall mean (i) in respect of a given
         Option exercise,  the product of (X) the Fair Market Value per share of
         Stock at the date of such exercise  (without  regard to any  subsequent
         change in the market price of shares)  minus the  exercise  price times
         (Y) the number of shares as to which the Option was  exercised  at that
         date,  and (ii) in respect of any other  settlement of an Award granted
         to the Participant,  the Fair Market Value of the cash or Stock paid or
         payable to Participant  (regardless of any elective  deferral) less any
         cash or the Fair Market  Value of any Stock or property  (other than an
         Award or award which would have itself then been forfeitable  hereunder
         and excluding any payment of tax  withholding)  paid by the Participant
         to the Company as a condition of or in connection with such settlement.

                  (b) Events Triggering Forfeiture. The forfeitures specified in
Section 10(a) will be triggered  upon the occurrence of any one of the following
Forfeiture Events at any time during the Participant's employment by the Company
or a subsidiary or affiliate or during the one-year period following termination
of such employment:

                           (i) The  Participant,  acting  alone or with  others,
         directly  or  indirectly,  prior to a Change in Control,  (A)  engages,
         either as employee, employer,  consultant,  advisor, or director, or as
         an owner,  investor,  partner,  or stockholder unless the Participant's
         interest  is  insubstantial,  in any  business  in an area or region in
         which the Company conducts business at the date the event occurs, which
         is  directly  in  competition  with a business  then  conducted  by the
         Company or a  subsidiary  or  affiliate;  (B) induces  any  customer or
         supplier of the Company or a subsidiary or affiliate,  or other company
         with which the  Company or a  subsidiary  or  affiliate  has a business
         relationship, to curtail, cancel, not renew, or not continue his or her
         or its business with the Company or any subsidiary or affiliate; or (C)
         induces, or attempts to influence,  any employee of or service provider
         to  the  Company  or  a  subsidiary  or  affiliate  to  terminate  such
         employment or service.  The Committee shall reasonably  determine which
         lines of business the Company conducts on any particular date and which
         third parties may  reasonably be deemed to be in  competition  with the
         Company.  For  purposes  of  this  Section  10(b)(i),  a  Participant's
         interest as a stockholder is insubstantial if it represents  beneficial
         ownership of less than five percent of the outstanding  class of stock,
         and a  Participant's  interest  as an owner,  investor,  or  partner is
         insubstantial  if  it  represents  ownership,   as  determined  by  the
         Committee  in  its  discretion,  of  less  than  five  percent  of  the
         outstanding equity of the entity;

                           (ii)  The  Participant  discloses,  uses,  sells,  or
         otherwise  transfers,  except in the course of employment with or other
         service to the Company or any subsidiary or affiliate, any confidential
         or  proprietary  information  of  the  Company  or  any  subsidiary  or
         affiliate,  including  but not  limited to  information  regarding  the
         Company's  current and potential  customers,  organization,  employees,
         finances,  and methods of operations and  investments,  so long as such
         information  has not otherwise  been  disclosed to the public or is not
         otherwise in the public  domain,  except as required by law or pursuant
         to   legal   process,   or  the   Participant   makes   statements   or
         representations,  or otherwise communicates, directly or indirectly, in
         writing,  orally,  or  otherwise,  or takes any other action which may,
         directly or indirectly,  disparage or be damaging to the Company or any
         of  its  subsidiaries  or  affiliates  or  their  respective  officers,
         directors,  employees,  advisors, businesses or reputations,  except as
         required by law or pursuant to legal process; or

                           (iii) The  Participant  fails to  cooperate  with the
         Company or any  subsidiary  or affiliate  by making  himself or herself
         available  to testify on behalf of the  Company or such  subsidiary  or
         affiliate in any action, suit, or proceeding,  whether civil, criminal,
         administrative,  or  investigative,  or  otherwise  fails to assist the
         Company or any  subsidiary  or affiliate in any such action,  suit,  or
         proceeding by providing  information  and meeting and  consulting  with
         members of management of, other  representatives of, or counsel to, the
         Company or such subsidiary or affiliate, as reasonably requested.

                  (c)  Agreement   Does  Not  Prohibit   Competition   or  Other
Participant  Activities.  Although the  conditions  set forth in this Section 10
shall be deemed to be  incorporated  into an Award, a Participant is not thereby
prohibited  from  engaging  in  any  activity,  including  but  not  limited  to
competition with the Company and its subsidiaries  and affiliates.  Rather,  the
non-occurrence  of the  Forfeiture  Events  set  forth  in  Section  10(b)  is a
condition to the Participant's right to realize and retain value from his or her
compensatory  Options  and  Awards,  and the  consequence  under the Plan if the
Participant  engages in an activity giving rise to any such Forfeiture Event are
the forfeitures  specified herein.  The Company and the Participant shall not be
precluded by this  provision or otherwise  from entering  into other  agreements
concerning the subject matter of Section 10(a) and 10(b).

                  (d)  Committee   Discretion.   The   Committee   may,  in  its
discretion,  waive in whole or in part the Company's  right to forfeiture  under
this  Section,  but no such waiver  shall be  effective  unless  evidenced  by a
writing signed by a duly  authorized  officer of the Company.  In addition,  the
Committee  may  impose   additional   conditions  on  Awards,  by  inclusion  of
appropriate provisions in the document evidencing or governing any such Award.

                  11.      General Provisions.

                  (a) Compliance with Legal and Other Requirements.  The Company
may, to the extent deemed necessary or advisable by the Committee,  postpone the
issuance or delivery of Stock or payment of other benefits under any Award until
completion of such registration or qualification of such Stock or other required
action  under any  federal or state law,  rule or  regulation,  listing or other
required action with respect to any stock exchange or automated quotation system
upon which the Stock or other securities of the Company are listed or quoted, or
compliance  with any other  obligation  of the  Company,  as the  Committee  may
consider   appropriate,   and  may   require  any   Participant   to  make  such
representations,  furnish such information and comply with or be subject to such
other conditions as it may consider  appropriate in connection with the issuance
or delivery of Stock or payment of other benefits in compliance  with applicable
laws, rules, and regulations,  listing requirements,  or other obligations.  The
foregoing  notwithstanding,  in connection with a Change in Control, the Company
shall  take or cause to be taken no  action,  and shall  undertake  or permit to
arise no legal or  contractual  obligation,  that results or would result in any
postponement  of the issuance or delivery of Stock or payment of benefits  under
any Award or the imposition of any other  conditions on such issuance,  delivery
or  payment,  to the extent  that such  postponement  or other  condition  would
represent  a  greater  burden  on a  Participant  than  existed  on the 90th day
preceding the Change in Control.

                  (b)  Limits  on  Transferability;  Beneficiaries.  No Award or
other  right or  interest  of a  Participant  under the Plan  shall be  pledged,
hypothecated  or  otherwise  encumbered  or subject to any lien,  obligation  or
liability  of such  Participant  to any  party  (other  than  the  Company  or a
subsidiary or affiliate thereof), or assigned or transferred by such Participant
otherwise  than  by  will  or the  laws  of  descent  and  distribution  or to a
Beneficiary upon the death of a Participant,  and such Awards or rights that may
be exercisable shall be exercised during the lifetime of the Participant only by
the  Participant  or his or her  guardian or legal  representative,  except that
Awards and other rights may be transferred to one or more transferees during the
lifetime  of the  Participant,  and  may be  exercised  by such  transferees  in
accordance  with the terms of such  Award,  but only if and to the  extent  such
transfers are permitted by the  Committee,  subject to any terms and  conditions
which the Committee may impose thereon (including  limitations the Committee may
deem  appropriate  in order  that  offers  and  sales  under  the Plan will meet
applicable  requirements of registration  forms under the Securities Act of 1933
specified by the Securities and Exchange Commission). A Beneficiary, transferee,
or other  person  claiming  any  rights  under  the  Plan  from or  through  any
Participant  shall be  subject to all terms and  conditions  of the Plan and any
Award document applicable to such Participant, except as otherwise determined by
the Committee,  and to any additional  terms and conditions  deemed necessary or
appropriate by the Committee.

                  (c)  Adjustments.  In the event  that any large,  special  and
non-recurring  dividend  or other  distribution  (whether in the form of cash or
property other than Stock),  recapitalization,  forward or reverse split,  Stock
dividend,   reorganization,   merger.  consolidation,   spin-off,   combination.
repurchase. share exchange, liquidation.  dissolution or other similar corporate
transaction  or event affects the Stock such that an adjustment is determined by
the Committee to be appropriate  under the Plan,  then the Committee  shall,  in
such  manner as it may deem  equitable,  adjust any or all of (i) the number and
kind of shares of Stock which may be delivered in connection with Awards granted
thereafter,  (ii)  the  number  and  kind  of  shares  of  Stock  subject  to or
deliverable in respect of outstanding Awards and (iii) the exercise price, grant
price or purchase  price  relating to any Award or, if deemed  appropriate,  the
Committee may make  provision for a payment of cash or property to the holder of
an outstanding Option (subject to Section 11(j)). In addition,  the Committee is
authorized to make  adjustments in the terms and conditions of, and the criteria
included in, Awards (including  Performance Awards and performance goals and any
hypothetical  funding  pool  relating  thereto)  in  recognition  of  unusual or
nonrecurring  events  (including,  without  limitation,  events described in the
preceding  sentence,  as well as acquisitions and dispositions of businesses and
assets)  affecting the Company,  any  subsidiary or affiliate or other  business
unit, or the financial statements of the Company or any subsidiary or affiliate,
or  in  response  to  changes  in  applicable  laws.   regulations,   accounting
principles,  tax rates and regulations or business  conditions or in view of the
Committee's  assessment of the business strategy of the Company,  any subsidiary
or affiliate or business unit thereof,  performance of comparable organizations,
economic and business conditions, personal performance of a Participant, and any
other circumstances  deemed relevant;  provided that no such adjustment shall be
authorized or made if and to the extent that the existence of such authority.

                  (d)      Tax Provisions.

                           (i)  Withholding.  The Company and any  subsidiary or
         affiliate is authorized to withhold from any Award granted, any payment
         relating to an Award under the Plan,  including from a distribution  of
         Stock,  or any payroll or other  payment to a  Participant,  amounts of
         withholding  and other taxes due or  potentially  payable in connection
         with any transaction  involving an Award, and to take such other action
         as  the  Committee  may  deem  advisable  to  enable  the  Company  and
         Participants  to satisfy  obligations  for the  payment of  withholding
         taxes and other tax obligations  relating to any Award.  This authority
         shall include  authority to withhold or receive Stock or other property
         and to make cash  payments  in  respect  thereof in  satisfaction  of a
         Participant's  withholding  obligations,   either  on  a  mandatory  or
         elective basis in the discretion of the Committee.  Other provisions of
         the Plan notwithstanding,  only the minimum amount of Stock deliverable
         in connection with an Award necessary to satisfy statutory  withholding
         requirements will be withheld.

                           (ii)  Required  Consent to and  Notification  of Code
         Section 83(b) Election. No election under Section 83(b) of the Code (to
         include in gross income in the year of transfer  the amounts  specified
         in Code  Section  83(b)) or under a similar  provision of the laws of a
         jurisdiction  outside the United  States may be made  unless  expressly
         permitted  by the  terms of the  Award  document  or by  action  of the
         Committee in writing prior to the making of such election.  In any case
         in  which a  Participant  is  permitted  to make  such an  election  in
         connection with an Award,  the Participant  shall notify the Company of
         such election within ten days of filing notice of the election with the
         Internal Revenue Service or other governmental  authority,  in addition
         to any filing and notification  required pursuant to regulations issued
         under Code Section 83(b) or other applicable provision.

                  (e)  Changes  to the Plan.  The Board may  amend,  suspend  or
terminate the Plan or the Committee's  authority to grant Awards under the Plan,
provided  that,  without the consent of an affected  Participant,  no such Board
action may materially and adversely affect the rights of such Participant  under
any outstanding Award. Without the approval of stockholders,  the Committee will
not  amend  or  replace   previously  granted  Options  in  a  transaction  that
constitutes  it  "repricing,"  as such  term is  used in  Instruction  3 to Item
402(b)(2)(iv)  of Regulation  S-K, as promulgated by the Securities and Exchange
Commission.

                  (f)  Right  of  Setoff.  The  Company  or  any  subsidiary  or
affiliate may, to the extent  permitted by applicable  law,  deduct from and set
off against any amounts the Company or it subsidiary or affiliate may owe to the
Participant from time to time,  including amounts payable in connection with any
Award,  owed as  wages,  fringe  benefits,  or  other  compensation  owed to the
Participant.  Such  amounts as may be owed by the  Participant  to the  Company,
including  but not limited to amounts  owed under  Section  10(a),  although the
Participant  shall  remain  liable  for any  part of the  Participant's  payment
obligation  not satisfied  through such  deduction and setoff.  By accepting any
Award granted hereunder, the Participant agrees to any deduction or setoff under
this Section 11(f).

                  (g) Unfunded Status of Awards; Creation of Trusts. The Plan is
intended  to  constitute   an   "unfunded"   plan  for  incentive  and  deferred
compensation.  With  respect to any payments  not yet made to a  Participant  or
obligation to deliver Stock pursuant to an Award,  nothing contained in the Plan
or any Award shall give any such  Participant  any rights that are greater  than
those of a general  creditor of the Company;  provided  that the  Committee  may
authorize the creation of trusts and deposit therein cash,  Stock,  other Awards
or other property,  or make other arrangements to meet the Company's obligations
under the Plan. Such trusts or other  arrangements  shall be consistent with the
"unfunded" status of the Plan unless the Committee otherwise determines with the
consent of each affected Participant.

                  (h)  Nonexclusivity  of the Plan.  Neither the adoption of the
Plan by the Board shall be construed as creating any limitations on the power of
the Board or a  committee  thereof to adopt such other  incentive  arrangements,
apart from the Plan, as it may deem desirable,  and such other  arrangements may
be either applicable generally or only in specific cases.

                  (i) Payments in the Event of Forfeitures;  Fractional  Shares.
Unless otherwise determined by the Committee, in the event of a forfeiture of an
Award  with  respect  to  which  a  Participant  paid  cash  consideration,  the
Participant shall be repaid the amount of such cash consideration. No fractional
shares of Stock shall be issued or delivered  pursuant to the Plan or any Award.
The Committee shall determine whether cash, other Awards or other property shall
be issued or paid in lieu of such  fractional  shares or whether such fractional
shares or any rights thereto shall be forfeited or otherwise eliminated.

                  (j) Certain  Limitations  Relating to Accounting  Treatment of
Awards. Other provisions of the Plan notwithstanding,  the Committee's authority
under the Plan  (including  under Sections 8(c),  11(c) and 11(d)) is limited to
the extent necessary to ensure that any Option or other Award of a type that the
Committee has intended to be subject to fixed accounting with a measurement date
at the date of grant or the date performance  conditions are satisfied under APB
25 shall not become subject to "variable" accounting solely due to the existence
of such authority,  unless the Committee specifically  determines that the Award
shall remain outstanding despite such "variable" accounting.  In addition, other
provisions of the Plan  notwithstanding,  (i) if any right under this Plan would
cause a transaction to be ineligible for  pooling-of-interests  accounting  that
would, but for the right hereunder,  be eligible for such accounting  treatment,
such  right  shall  be  automatically  adjusted  so  that   pooling-of-interests
accounting shall be available,  including by substituting Stock or cash having a
Fair Market Value equal to any cash or Stock otherwise payable in respect of any
right  to  cash  which  would  cause  the   transaction  to  be  ineligible  for
pooling-of-interests  accounting,  and (ii) if the  authority of the  Continuing
Directors to determine that an event shall not constitute a Change in Control or
other  authority  under Section 9(c) would cause a transaction  to be ineligible
for  pooling-of-interests  accounting  that would,  but for such  authority,  be
eligible for such accounting  treatment,  such authority shall be limited to the
extent   necessary   so  that   such   transaction   would   be   eligible   for
pooling-of-interests accounting.

                  (k) Governing Law. The validity,  construction,  and effect of
the Plan, any rules and regulations  relating to the Plan and any Award document
shall be  determined  in  accordance  with the  laws of the  State of  Delaware,
without  giving  effect to  principles  of  conflicts  of laws,  and  applicable
provisions of federal law.

                  (l) Awards to  Participants  Outside  the United  States.  The
Committee  may modify the terms of any Award under the Plan made to or held by a
Participant  who is then  resident or primarily  employed  outside of the United
States in any manner deemed by the Committee to be necessary or  appropriate  in
order that such Award  shall  conform to laws,  regulations,  and customs of the
country in which the Participant is then resident or primarily  employed,  or so
that the value and other benefits of the Award to the  Participant,  as affected
by  foreign  tax laws  and  other  restrictions  applicable  as a result  of the
Participant's residence or employment abroad shall be comparable to the value of
such an Award to a  Participant  who is  resident or  primarily  employed in the
United  States.  An Award may be modified  under this Section  11(l) in a manner
that is  inconsistent  with  the  express  terms  of the  Plan,  so long as such
modifications will not contravene any applicable law or regulation.

                  (m)  Limitation on Rights  Conferred  under Plan.  Neither the
Plan nor any  action  taken  hereunder  shall be  construed  as (i)  giving  any
Eligible  Person or Participant  the right to continue as an Eligible  Person or
Participant  or in the  employ or  service of the  Company  or a  subsidiary  or
affiliate,  (ii)  interfering  in any way with the  right  of the  Company  or a
subsidiary  or  affiliate to terminate  any Eligible  Person's or  Participant's
employment  or  service  at  any  time,  (iii)  giving  an  Eligible  Person  or
Participant  any claim to be granted  any Award  under the Plan or to be treated
uniformly  with  other  Participants  and  employees,  or (iv)  conferring  on a
Participant  any of the rights of a stockholder  of the Company unless and until
the Participant is duly issued or transferred shares of Stock in accordance with
the  terms of an Award or an  Option  is duly  exercised.  Except  as  expressly
provided  in the Plan  and an Award  document,  neither  the Plan nor any  Award
document  shall confer on any person other than the Company and the  Participant
any rights or remedies thereunder.

                  (n) Severability;  Entire Agreement.  If any of the provisions
of this Plan or any Award  document is finally  held to be  invalid,  illegal or
unenforceable  (whether  in whole or in part),  such  provision  shall be deemed
modified to the extent,  but only to the extent, of such invalidity,  illegality
or unenforceability, and the remaining provisions shall not be affected thereby;
provided,  that,  if any of such  provisions  is  finally  held  to be  invalid,
illegal, or unenforceable  because it exceeds the maximum scope determined to be
acceptable to permit such provision to be  enforceable,  such provision shall be
deemed to be modified to the minimum  extent  necessary  to modify such scope in
order to make  such  provision  enforceable  hereunder.  The Plan and any  Award
documents  contain  the entire  agreement  of the  parties  with  respect to the
subject matter thereof and supersede all prior agreements,  promises, covenants,
arrangements,  communications,  representations  and  warranties  between  them,
whether written or oral with respect to the subject matter thereof.

                  (o) Plan  Effective  Date.  The Plan has been  approved by the
Board and is to be effective on and as of October 12, 2000.

                  (p)  Termination.  Unless earlier  terminated by action of the
Board of  Directors,  the Plan will remain in effect until such time as no Stock
remains  available  for  delivery  under the Plan and the Company has no further
rights or obligations  under the Plan with respect to  outstanding  Awards under
the Plan.<PAGE>

                                                                   Exhibit 10.23

                                   TOO, INC.

                          SECOND AMENDED AND RESTATED
               1999 STOCK OPTION AND PERFORMANCE INCENTIVE PLAN
   (Amended by the Board of Directors on May 10, 2000 and February 15, 2001)

                                   ARTICLE 1

                           Establishment and Purpose

     Section 1.1.   Establishment and Effective Date. Too, Inc., a Delaware
corporation (the "Company"), hereby establishes a stock incentive plan to be
known as the "Too, Inc. 1999 Stock Option and Performance Incentive Plan" (the
"Plan"). The Plan shall become effective on the date The Limited, Inc.
distributes (the "Distribution") to its shareholders the Company's common stock,
par value $.01 per share (the "Common Stock").

     Section 1.2.   Purpose.  The Company desires to attract and retain the best
available executive and key management associates for itself and its
subsidiaries and to encourage the highest level of performance by such
associates in order to serve the best interests of the Company and its
shareholders. The Plan is expected to contribute to the attainment of these
objectives by offering eligible associates the opportunity to acquire stock
ownership interests in the Company, and other rights with respect to stock of
the Company, and to thereby provide them with incentives to put forth maximum
efforts for the success of the Company and its subsidiaries.

                                   ARTICLE 2

                                    Awards

     Section 2.1.   Form of Awards.  Awards under the Plan may be granted in any
one or all of the following forms: (i) incentive stock options ("Incentive Stock
Options") meeting the requirements of Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code"); (ii) nonstatutory stock options ("Nonstatutory
Stock Options") (unless otherwise indicated, references in the Plan to "Options"
shall include both Incentive Stock Options and Nonstatutory Stock Options);
(iii) stock appreciation rights ("Stock Appreciation Rights"), as described in
Article 7, which may be awarded either in tandem with Options ("Tandem Stock
Appreciation Rights") or on a stand-alone basis ("Nontandem Stock Appreciation
Rights"); (iv) shares of Common Stock which are restricted as provided in
Article II ("Restricted Shares"); (v) units representing shares of Common Stock,
as described in Article 12 ("Performance Shares"); (vi) units which do not
represent shares of Common Stock but which may be paid in the form of Common
Stock, as described in Article 13 ("Performance Units"); (vii) shares of
unrestricted Common Stock ("Unrestricted Shares"); and (viii) tax offset
payments ("Tax Offset Payments"), as described in Article 15.

     Section 2.2.   Maximum Shares Available.  The maximum aggregate number of
shares of Common Stock available for award under the Plan is 5,150,000 subject
to adjustment pursuant to Article 16. In addition, Tax Offset Payments which may
be awarded under the Plan will not exceed the number of shares available for
issuance under the Plan. Shares of Common Stock issued pursuant to the Plan may
be either authorized but unissued shares or issued shares reacquired  by the
Company. In the event that prior to the end of the period during which Options
may be granted under the Plan, any Option or any Nontandem Stock Appreciation
Right under the Plan expires unexercised or is terminated, surrendered or
canceled (other than in connection with the exercise of a Stock Appreciation
Right) without being exercised in whole or in part for any reason, or any
Restricted Shares, Performance Shares or Performance Units are forfeited, or if
such awards are settled in cash in lieu of shares of Common Stock, then such
shares or units may, at the discretion of the Committee (as defined below) to
the extent permissible under Rule 16b-3 under the Securities Exchange Act of
1934 (the "Act") be made available for subsequent awards under the Plan, upon
such terms as the Committee may determine.
<PAGE>

     Section 2.3.  Return of Prior Awards.  As a condition to any subsequent
award, the Committee shall have the right, at its discretion, to require
associates to return to the Company awards previously granted under this Plan.
Subject to the provisions of this Plan, such new award shall be upon such terms
and conditions as are specified by the Committee at the time the new award is
granted to the extent permitted by Rule 16b-3 under the Act.

                                   ARTICLE 3

                                Administration

     Section 3.1.  Committee.  The Plan shall be administered by a Committee
(the "Committee") appointed by the Board and consisting of not less than two (2)
members of the Board. Each member of the Committee shall be an "outside
director" (within the meaning of Section 162(m) of the Code) and a "non-employee
director" (within the meaning of Rule 16b-3(b)(3)(i) under the Act).

     Section 3.2.  Powers of Committee.  Subject to the express provisions of
the Plan, the Committee shall have the power and authority (i) to grant Options
and to determine the purchase price of the Common Stock covered by each Option,
the term of each Option, the number of shares of Common Stock to be covered by
each Option and any performance objectives or vesting standards applicable to
each Option; (ii) to designate Options as Incentive Stock Options or
Nonstatutory Stock Options and to determine which Options, if any, shall be
accompanied by Tandem Stock Appreciation Rights; (iii) to grant Tandem Stock
Appreciation Rights and Nontandem Stock Appreciation Rights and to determine the
terms and conditions of such rights; (iv) to grant Restricted Shares and to
determine the term of the restricted period and other conditions and
restrictions applicable to such shares; (v) to grant Performance Shares and
Performance Units and to determine the performance objectives, performance
periods and other conditions applicable to such shares or units; (vi) to grant
Unrestricted Shares; (vii) to determine the amount of, and to make, Tax Offset
Payments; and (viii) to determine the associates to whom, and the time or times
at which, Options, Stock Appreciation Rights, Restricted Shares, Performance
Shares, Performance Units and Unrestricted Shares shall be granted.

     Section 3.3.  Delegation.  The Committee may delegate to one or more of its
members or to any other person or persons such ministerial duties as it may deem
advisable; provided, however, that the Committee may not delegate any of its
responsibilities hereunder if such delegation will cause (i) transactions under
the Plan to fail to comply with Section 16 of the Act or (ii) the Committee to
fail to qualify as "outside directors" under Section 162(m) of the Code. The
Committee may also employ attorneys, consultants, accountants or other
professional advisors and shall be entitled to rely upon the advice, opinions or
valuations of any such advisors.

     Section 3.4.  Interpretations.  The Committee shall have sole discretionary
authority to interpret the terms of the Plan, to adopt and revise rules,
regulations and policies to administer the Plan and to make any other factual
determinations which it believes to be necessary or advisable for the
administration of the Plan. All actions taken and interpretations and
determinations made by the Committee in good faith shall be final and binding
upon the Company, all associates who have received awards under the Plan and all
other interested persons.

     Section 3.5.  Liability; Indemnification.  No member of the Committee, nor
any person to whom duties have been delegated, shall be personally liable for
any action, interpretation or determination made with respect to the Plan or
awards made thereunder, and each member of the Committee shall be fully
indemnified and protected by the Company with respect to any liability he or she
may incur with respect to any such action, interpretation or determination, to
the extent permitted by applicable law and to the extent provided in the
Company's Certificate of Incorporation and Bylaws, as amended from time to time.
<PAGE>

                                   ARTICLE 4

                                  Eligibility

     Awards shall be limited to executive and key management associates who are
regular, full-time associates of the Company and its present and future
subsidiaries. In determining the associates to whom awards shall be granted and
the number of shares to be covered by each award, the Committee shall take into
account the nature of the services rendered by such associates, their present
and potential contributions to the success of the Company and its subsidiaries
and such other factors as the Committee in its sole discretion shall deem
relevant. As used in this Plan, the term "subsidiary" shall mean any corporation
which at the time qualifies as a subsidiary of the Company under the definition
of "subsidiary corporation" set forth in Section 424(f) of the Code, or any
successor provision hereafter enacted. No associate may be granted in any
calendar year awards covering more than 1,100,000 shares of Common Stock.

                                   ARTICLE 5

                                 Stock Options

     Section 5.1.  Grant of Options.  Options may be granted under this Plan for
the purchase of shares of Common Stock. Options shall be granted in such form
and upon such terms and conditions, including the satisfaction of corporate or
individual performance objectives and other vesting standards, as the Committee
shall from time to time determine.

     Section 5.2.  Option Price.  The option price of each Option to purchase
Common Stock shall be determined by the Committee at the time of the grant, but
shall not be less than 100 percent of the fair market value of the Common Stock
subject to such Option at the time of grant. The option price so determined
shall also be applicable in connection with the exercise of any Tandem Stock
Appreciation Right granted with respect to such Option. The exercise price of an
option previously granted under the Plan shall not thereafter be reduced other
than pursuant to the provisions of Article 17 or Article 18.

     Section 5.3.  Term of Options.  The term of each Option granted under the
Plan shall not exceed ten (10) years from the date of grant, subject to earlier
termination as provided in Articles 9 and 10, except as otherwise provided in
Section 6.1 with respect to ten (10) percent shareholders of the Company.

     Section 5.4.  Exercise of Options.  An Option may be exercised, in whole or
in part, at such time or times as the Committee shall determine. The Committee
may, in its discretion, accelerate the exercisability of any Option at any time.
Options may be exercised by an associate by giving written notice to the
Committee stating the number of shares of Common Stock with respect to which the
Option is being exercised and tendering payment therefor. Payment for the Common
Stock issuable upon exercise of the Option shall be made in full in cash or by
certified check or, if the Committee, in its sole discretion, permits, in shares
of Common Stock (valued at fair market value on the date of exercise). As soon
as reasonably practicable following such exercise, a certificate representing
the shares of Common Stock purchased, registered in the name of the associate,
shall be delivered to the associate.

     Section 5.5.  Cancellation of Stock Appreciation Rights.  Upon exercise of
all or a portion of an Option, the related Tandem Stock Appreciation Rights
shall be canceled with respect to an equal number of shares of Common Stock.

                                   ARTICLE 6

              Special Rules Applicable to Incentive Stock Options

     Section 6.1.  Ten Percent Stockholder.  Notwithstanding any other provision
of this Plan to the contrary, no associate may receive an Incentive Stock Option
under the Plan if such associate, at the time the award is granted, owns (after
application of the rules contained in Section 424(d) of the Code) stock
possessing more than ten (10) percent of the total combined voting power of all
classes of stock of the Company or its subsidiaries, unless (i) the option price
for such Incentive Stock Option is at
<PAGE>

least 110 percent of the fair market value of the Common Stock subject to such
Incentive Stock Option on the date of grant and (ii) such Option is not
exercisable after the date five (5) years from the date such Incentive Stock
Option is granted.

     Section 6.2.  Limitation on Grants.  The aggregate fair market value
(determined with respect to each Incentive Stock Option at the time such
Incentive Stock Option is granted) of the shares of Common Stock with respect to
which Incentive Stock Options are exercisable for the first time by an associate
during any calendar year (under this Plan or any other plan of the Company or a
subsidiary) shall not exceed $100,000.

     Section 6.3.  Limitations on Time of Grant.  No grant of an Incentive Stock
Option shall be made under this Plan more than ten (10) years after the earlier
of the date of adoption of the Plan by the Board or the date the Plan is
approved by shareholders.

                                   ARTICLE 7

                           Stock Appreciation Rights

     Section 7.1.  Grants of Stock Appreciation Rights.  Tandem Stock
Appreciation Rights may be awarded by the Committee in connection with any
Option granted under the Plan, either at the time the Option is granted or
thereafter at any time prior to the exercise, termination or expiration of the
Option. Nontandem Stock Appreciation Rights may also be granted by the Committee
at any time. At the time of grant of a Nontandem Stock Appreciation Right, the
Committee shall specify the number of shares of Common Stock covered by such
right and the base price of shares of Common Stock to be used in connection with
the calculation described in Section 7.04 below. The base price of a Nontandem
Stock Appreciation Right shall be not less than 100 percent of the fair market
value of a share of Common Stock on the date of grant. Stock Appreciation Rights
shall be subject to such terms and conditions not inconsistent with the other
provisions of this Plan as the Committee shall determine.

     Section 7.2.  Limitations on Exercise.  A Tandem Stock Appreciation Right
shall be exercisable only to the extent that the related Option is exercisable
and shall be exercisable only for such period as the Committee may determine
(which period may expire prior to the expiration date of the related Option).
Upon the exercise of all or a portion of Tandem Stock Appreciation Rights, the
related Option shall be canceled with respect to an equal number of shares of
Common Stock. Shares of Common Stock subject to Options, or portions thereof,
surrendered upon exercise of a Tandem Stock Appreciation Right, shall not be
available for subsequent awards under the Plan. A Nontandem Stock Appreciation
Right shall be exercisable during such period as the Committee shall determine.

     Section 7.3.  Surrender or Exchange of Tandem Stock Appreciation Rights.  A
Tandem Stock Appreciation Right shall entitle the associate to surrender to the
Company unexercised the related option, or any portion thereof, and to receive
from the Company in exchange therefor that number of shares of Common Stock
having an aggregate fair market value equal to (A) the excess of (i) the fair
market value of one (1) share of Common Stock as of the date the Tandem Stock
Appreciation Right is exercised over (ii) the option price per share specified
in such Option, multiplied by (B) the number of shares of Common Stock subject
to the Option, or portion thereof, which is surrendered. Cash shall be delivered
in lieu of any fractional shares.

     Section 7.4.  Exercise of Nontandem Stock Appreciation Rights.  The
exercise of a Nontandem Stock Appreciation Right shall entitle the associate to
receive from the Company that number of shares of Common Stock having an
aggregate fair market value equal to (A) the excess of (i) the fair market value
of one (1) share of Common Stock as of the date on which the Nontandem Stock
Appreciation Right is exercised over (ii) the base price of the shares covered
by the Nontandem Stock Appreciation Right, multiplied by (B) the number of
shares of Common Stock covered by the Nontandem Stock Appreciation Right, or the
portion thereof being exercised. Cash shall be delivered in lieu of any
fractional shares.

     Section 7.5.  Settlement of Stock Appreciation Rights.  As soon as is
reasonably practicable after the exercise of a Stock Appreciation Right, the
Company shall (i) issue, in the name of the associate, stock certificates
representing the total number of full shares of Common Stock to which the
associate is entitled pursuant to Section 7.03 or 7.04 hereof, and cash in an
amount equal to the fair market value, as of the date of exercise, of any
resulting fractional shares, and (ii) if the Committee causes the
<PAGE>

Company to elect to settle all or part of its obligations arising out of the
exercise of the Stock Appreciation Right in cash pursuant to Section 7.06,
deliver to the associate an amount in cash equal to the fair market value, as of
the date of exercise, of the shares of Common Stock it would otherwise be
obligated to deliver.

     Section 7.6.  Cash Settlement.  The Committee, in its discretion, may cause
the Company to settle all or any part of its obligation arising out of the
exercise of a Stock Appreciation Right by the payment of cash in lieu of all or
part of the shares of Common Stock it would otherwise be obligated to deliver in
an amount equal to the fair market value of such shares on the date of exercise.

                                   ARTICLE 8

          Nontransferability of Options and Stock Appreciation Rights

     No Option or Stock Appreciation Right may be transferred, assigned, pledged
or hypothecated (whether by operation of law or otherwise), except as provided
by will or the applicable laws of descent and distribution, and no Option or
Stock Appreciation Right shall be subject to execution, attachment or similar
process. Any attempted assignment, transfer, pledge, hypothecation or other
disposition of an Option or a Stock Appreciation Right not specifically
permitted herein shall be null and void and without effect. An Option or Stock
Appreciation Right may be exercised by an associate only during his or her
lifetime, or following his or her death pursuant to Article 10.

                                   ARTICLE 9

                           Termination of Employment

     Section 9.1.  Exercise after Termination of Employment.  Except as the
Committee may at any time provide, in the event that the employment of an
associate to whom an Option or Stock Appreciation Right has been granted under
the Plan shall be terminated (for reasons other than death or total disability),
such Option or Stock Appreciation Right may be exercised (to the extent that the
associate was entitled to do so at the termination of his employment) at any
time within three (3) months after such termination of employment.

     Section 9.2.  Total Disability.  In the event that an associate to whom an
Option or Stock Appreciation Right has been granted under the Plan shall become
totally disabled, except as the Committee may at anytime provide, such Option or
Stock Appreciation Right may be exercised at any time during the first nine (9)
months that the associate receives benefits under the Company's Long-Term
Disability Plan (the "Disability Plan"). For purposes hereof, "total disability"
shall have the definition set forth in the Disability Plan, which definition is
hereby incorporated by reference.

                                  ARTICLE 10

                              Death of Associate

     If an associate to whom an Option or Stock Appreciation Right has been
granted under the Plan shall die while employed by the Company or one of its
subsidiaries or within three (3) months after the termination of such
employment, except as the Committee may at anytime provide, such Option or Stock
Appreciation Right may be exercised to the extent that the associate was
entitled to do so at the time of his or her death, by the associate's estate or
by the person who acquires the right to exercise such Option or Stock
Appreciation Right upon his or her death by bequest or inheritance. Such
exercise may occur at any time within one (1) year after the date of the
associate's death or such other period as the Committee may at anytime provide,
but in no case later than the date on which the Option or Stock Appreciation
Right terminates.
<PAGE>

                                  ARTICLE 11

                               Restricted Shares

     Section 11.1.  Grant of Restricted Shares.  The Committee may from time to
time cause the Company to grant Restricted Shares under the Plan to associates,
subject to such restrictions, conditions and other terms as the Committee may
determine.

     Section 11.2.  Restrictions.  At the time a grant of Restricted Shares is
made, the Committee shall establish a period of time (the "Restricted Period")
applicable to such Restricted Shares. Each grant of Restricted Shares may be
subject to a different Restricted Period. The Committee may, in its sole
discretion, at the time a grant is made, prescribe restrictions in addition to
or other than the expiration of the Restricted Period, including the
satisfaction of corporate or individual performance objectives, which shall be
applicable to all or any portion of the Restricted Shares. Except with respect
to grants of Restricted Shares intended to qualify as performance based
compensation for purposes of Section 162(m) of the Code, the Committee may also,
in its sole discretion, shorten or terminate the Restricted Period or waive any
other restrictions applicable to all or a portion of such Restricted Shares.
None of the Restricted Shares may be sold, transferred, assigned, pledged or
otherwise encumbered or disposed of during the Restricted Period or prior to the
satisfaction of any other restrictions prescribed by the Committee with respect
to such Restricted Shares.

     Section 11.3.  Restricted Stock Certificates.  If the Committee deems it
necessary or appropriate, the Company may issue, in the name of each associate
to whom Restricted Shares have been granted, stock certificates representing the
total number of Restricted Shares granted to the associate, provided that such
certificates bear an appropriate legend or other restriction on transfer.  The
Secretary of the Company shall hold such certificates, properly endorsed for
transfer, for the associate's benefit until such time as the Restricted Shares
are forfeited to the Company, or the restrictions lapse.

     Section 11.4.  Rights of Holders of Restricted Shares.  Except as
determined by the Committee either at the time Restricted Shares are awarded or
any time thereafter prior to the lapse of the restrictions, holders of
Restricted Shares shall not have the right to vote such shares or the right to
receive any dividends with respect to such shares. All distributions, if any,
received by an associate with respect to Restricted Shares as a result of any
stock split-up, stock distribution, a combination of shares, or other similar
transaction shall be subject to the restrictions of this Article 11.

     Section 11.5.  Forfeiture.  Except as the Committee may at any time
provide, any Restricted Shares granted to an associate pursuant to the Plan
shall be forfeited if the associate terminates employment with the Company or
its subsidiaries prior to the expiration or termination of the Restricted Period
and the satisfaction of any other conditions applicable to such Restricted
Shares. Upon such forfeiture, the Secretary of the Company shall either cancel
or retain in its treasury the Restricted Shares that are forfeited to the
Company.

     Section 11.6.  Delivery of Restricted Shares.  Upon the expiration or
termination of the Restricted Period and the satisfaction of any other
conditions prescribed by the Committee, the restrictions applicable to the
Restricted Shares shall lapse and a stock certificate for the number of
Restricted Shares with respect to which the restrictions have lapsed shall be
delivered, free of all such restrictions, to the associate or the associate's
beneficiary or estate, as the case may be.

     Section 11.7.  Performance-based Objectives.  At the time of the grant of
Restricted Shares to an associate, and prior to the beginning of the performance
period to which performance objectives relate, the Committee may establish
performance objectives based on any one or more of the following: price of
Company Common Stock or the stock of any affiliate, shareholder return, return
on equity, return on investment, return on capital, sales productivity,
comparable store sales growth, economic profit, economic value added, net
income, operating income, gross margin, sales, free cash flow, earnings per
share, operating company contribution or market share. These factors shall have
a minimum performance standard below which, and a maximum performance standard
above which, no payments will be made. These performance goals may be based on
an analysis of historical performance and growth expectations for the business,
financial results of other comparable businesses, and progress towards achieving
the long-range strategic plan for the business. These performance goals and
determination of results shall be
<PAGE>

based entirely on financial measures. The Committee may not use any discretion
to modify award results except as permitted under Section 162(m) of the Code.

                                  ARTICLE 12

                              Performance Shares

     Section 12.1.  Award of Performance Shares.  For each Performance Period
(as defined in Section 12.2), Performance Shares may be granted under the Plan
to such associates of the Company and its subsidiaries as the Committee shall
determine. Each Performance Share shall be deemed to be equivalent to one (1)
share of Common Stock. Performance Shares granted to an associate shall be
credited to an account (a "Performance Share Account") established and
maintained for such associate.

     Section 12.2.  Performance Period.  "Performance Period" shall mean such
period of time as shall be determined by the Committee in its sole discretion.
Different Performance Periods may be established for different associates
receiving Performance Shares. Performance Periods may run consecutively or
concurrently.

     Section 12.3.  Right to Payment of Performance Shares.  With respect to
each award of Performance Shares under this Plan, the Committee shall specify
performance objectives (the "Performance Objectives") which must be satisfied in
order for the associate to vest in the Performance Shares which have been
awarded to him or her for the Performance Period. If the Performance Objectives
established for an associate for the Performance Period are partially but not
fully met, the Committee may, nonetheless, in its sole discretion, determine
that all or a portion of the Performance Shares have vested. If the Performance
Objectives for a Performance Period are exceeded, the Committee may, in its sole
discretion, grant additional, full vested Performance Shares to the associate.
The Committee may also determine, in its sole discretion, that Performance
Shares awarded to an associate shall become partially or fully vested upon the
associate's death, total disability (as defined in Article 9) or retirement, or
upon the termination of the associate's employment prior to the end of the
Performance Period.

     Section 12.4.  Payment for Performance Shares.  As soon as practicable
following the end of a Performance Period, the Committee shall determine whether
the Performance Objectives for the Performance Period have been achieved (or
partially achieved to the extent necessary to permit partial vesting at the
discretion of the Committee pursuant to Section 12.3). If the Performance
Objectives for the Performance Period have been exceeded, the Committee shall
determine whether additional Performance Shares shall be granted to the
associate pursuant to Section 12.3. As soon as reasonably practicable after such
determinations, or at such later date as the Committee shall determine at the
time of grant, the Company shall pay to the associate an amount with respect to
each vested Performance Share equal to the fair market value of a share of
Common Stock on such payment date or, if the Committee shall so specify at the
time of grant, an amount equal to (i) the fair market value of a share of Common
Stock on the payment date less (ii) the fair market value of a share of Common
Stock on the date of grant of the Performance Share. Payment shall be made
entirely in cash, entirely in Common Stock (including Restricted Shares) or in
such combination of cash and Common Stock as the Committee shall determine.

     Section 12.5.  Voting and Dividend Rights.  Except as the Committee may
otherwise provide, no associate shall be entitled to any voting rights, to
receive any dividends, or to have his or her Performance Share Account credited
or increased as a result of any dividends or other distribution with respect to
Common Stock. Notwithstanding the foregoing, within sixty (60) days from the
date of payment of a dividend by the Company on its shares of Common Stock, the
Committee, in its discretion, may credit an associate's Performance Share
Account with additional Performance Shares having an aggregate fair market value
equal to the dividend per share paid on the Common Stock multiplied by the
number of Performance Shares credited to his or her account at the time the
dividend was declared.
<PAGE>

                                  ARTICLE 13

                               Performance Units

     Section 13.1.  Award of Performance Units.  For each Performance Period (as
defined in Section 12.2), Performance Units may be granted under the Plan to
such associates of the Company and its subsidiaries as the Committee shall
determine. The award agreement covering such Performance Units shall specify a
value for each Performance Unit or shall set forth a formula for determining the
value of each Performance Unit at the time of payment (the "Ending Value"). If
necessary to make the calculation of the amount to be paid to the Associate
pursuant to Section 13.3, the Committee shall also state in the award agreement
the initial value of each Performance Unit (the "Initial Value").  Performance
Units granted to an associate shall be credited to an account (a "Performance
Unit Account") established and maintained for such associate.

     Section 13.2.  Right to Payment of Performance Units.  With respect to each
award of Performance Units under this Plan, the Committee shall specify
Performance Objectives which must be satisfied in order for the associate to
vest in the Performance Units which have been awarded to him or her for the
Performance Period. If the Performance Objectives established for an associate
for the Performance Period are partially but not fully met, the Committee may,
nonetheless, in its sole discretion, determine that all or a portion of the
Performance Units have vested. If the Performance Objectives for a Performance
Period are exceeded, the Committee may, in its sole discretion, grant
additional, fully vested Performance Units to the associate. The Committee may
also determine, in its sole discretion, that Performance Units awarded to an
associate shall become partially or fully vested upon the associate's death,
total disability (as defined in Article 9) or retirement, or upon the
termination of employment of the associate by the Company.

     Section 13.3.  Payment for Performance Units.  As soon as practicable
following the end of a Performance Period, the Committee shall determine whether
the Performance Objectives for the Performance Period have been achieved (or
partially achieved to the extent necessary to permit partial vesting at the
discretion of the Committee pursuant to Section 13.2). If the Performance
Objectives for the Performance Period have been exceeded, the Committee shall
determine whether additional Performance Units shall be granted to the associate
pursuant to Section 13.2. As soon as reasonably practicable after such
determinations, or at such later date as the Committee shall determine, the
Company shall pay to the associate an amount with respect to each vested
Performance Unit equal to the Ending Value of the Performance Unit or, if the
Committee shall so specify at the time of grant, an amount equal to (i) the
Ending Value of the Performance Unit less (ii) the Initial Value of the
Performance Unit. Payment shall be made entirely in cash, entirely in Common
Stock (including Restricted Shares) or in such combination of cash and Common
Stock as the Committee shall determine.

                                  ARTICLE 14

                              Unrestricted Shares

     Section 14.1.  Award of Unrestricted Shares.  The Committee may cause the
Company to grant Unrestricted Shares to associates at such time or times, in
such amounts and for such reasons as the Committee, in its sole discretion,
shall determine. No payment shall be required for Unrestricted Shares.

     Section 14.2.  Delivery of Unrestricted Shares.  The Company shall issue,
in the name of each associate to whom Unrestricted Shares have been granted,
stock certificates representing the total number of Unrestricted Shares granted
to the associate, and shall deliver such certificates to the associate as soon
as reasonably practicable after the date of grant or on such later date as the
Committee shall determine at the time of grant.
<PAGE>

                                  ARTICLE 15

                              Tax Offset Payments

     The Committee shall have the authority at the time of any award under this
Plan or anytime thereafter to make Tax Offset Payments to assist associates in
paying income taxes incurred as a result of their participation in this Plan.
The Tax Offset Payments shall be determined by multiplying a percentage
established by the Committee by all or a portion (as the Committee shall
determine) of the taxable income recognized by an associate upon (i) the
exercise of a Nonstatutory Stock Option or a Stock Appreciation Right, (ii) the
disposition of shares received upon exercise of an Incentive Stock Option, (iii)
the lapse of restrictions on Restricted Shares, (iv) the award of Unrestricted
Shares, or (v) payments for Performance Shares or Performance Units. The
percentage shall be established, from time to time, by the Committee at that
rate which the Committee, in its sole discretion, determines to be appropriate
and in the best interests of the Company to assist associates in paying income
taxes incurred as a result of the events described in the preceding sentence.
Tax Offset Payments shall be subject to the restrictions on transferability
applicable to Options and Stock Appreciation Rights under Article 8.

                                  ARTICLE 16

                              Changes in Control

  Upon the occurrence of a Change in Control (as defined below), the following
shall occur:

  (1) Options. At the date of such Change in Control, all outstanding and
unvested stock options granted under the Plan shall immediately and fully vest
and become exercisable.

  (2) Stock Appreciation Rights. At the date of such Change in Control, all
outstanding and unvested Stock Appreciation Rights granted under the Plan shall
immediately vest and become exercisable.

  (3) Restricted Shares. At the date of such Change in Control, Restricted
Shares granted under the Plan shall be deemed to be fully vested and the
Restricted Period shall be deemed to expire.

  (4) Performance Shares and Performance Units. At the date of such Change in
Control, Performance Shares and Performance Units granted under the Plan shall
be deemed to be fully vested and payable.

     "Change in Control" means the occurrence of any of the following:

  (1) Any "Person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) is or becomes
the "Beneficial Owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Corporation representing 25% or
more of the combined voting power of the Corporation's then outstanding
securities (a "25% Shareholder") provided however, that the term 25% Shareholder
shall not include any Person if such Person would not otherwise be a 25%
Shareholder but for a reduction in the number of outstanding voting shares
resulting from a stock repurchase program or other similar plan of the Company
or from a self-tender offer of the Company, which plan or tender offer commenced
on or after the date hereof, provided, however, that the term "25% Shareholder"
shall include such Person from and after the first date upon which (A) such
Person, since the date of the commencement of such plan or tender offer, shall
have acquired Beneficial Ownership of, in the aggregate, a number of voting
shares of the Company equal to 1% or more of the voting shares of the Company
then outstanding, and (B) such Person, together with all affiliates and
associates of such Person, shall Beneficially Own 25% or more of the voting
shares of the Company then outstanding. In calculating the percentage of the
outstanding voting shares that are Beneficially Owned by a Person for purposes
of this subsection (1), voting Shares that are Beneficially Owned by such Person
shall be deemed outstanding, and voting shares that are not Beneficially Owned
by such Person and that are subject to issuance upon the exercise or conversion
of outstanding conversion rights, exchange rights, rights, warrants or options
shall not be deemed outstanding.  Notwithstanding the foregoing, if the Board of
Directors of the Company determines in good faith that a Person that would
otherwise be a 25%
<PAGE>

Shareholder pursuant to the foregoing provisions of this subsection (1) has
become such inadvertently, and such Person (a) promptly notifies the Board of
Directors of such status and (b)as promptly as practicable thereafter, either
divests of a sufficient number of voting shares so that such Person would no
longer be a 25% Shareholder, or causes any other circumstance, such as the
existence of an agreement respecting voting shares, to be eliminated such that
such Person would no longer be a 25% Shareholder as defined pursuant to this
subsection (1), then such Person shall not be deemed to be a 25% Shareholder for
any purposes of this Plan. Any determination made by the Board of Directors of
the Company as to whether any Person is or is not a 25% Shareholder shall be
conclusive and binding; or

  (2) A change in composition of the Board of Directors of the Corporation
occurring any time during a consecutive two-year period as a result of which
fewer than a majority of the Board of Directors are Continuing Directors (for
purposes of this section, the term "Continuing Director" means a director who
was either (A) first elected or appointed as a Director prior to May 10, 2000;
or (B) subsequently elected or appointed as a director if such director was
nominated or appointed by at least a majority of the then Continuing Directors);
or

  (3) Any of the following occurs:

      (A) a merger or consolidation of the Corporation, other than a merger or
  consolidation in which the voting securities of the Corporation immediately
  prior to the merger or consolidation continue to represent (either by
  remaining outstanding or being converted into securities of the surviving
  entity) 60% or more of the combined voting power of the Corporation or
  surviving entity immediately after the merger or consolidation with another
  entity;

      (B) a sale, exchange, or other disposition (in a single transaction or a
  series of related transactions) of all or substantially all of the assets of
  the Corporation which shall include, without limitation, the sale of assets
  aggregating more than 50% of the assets of the Corporation on a consolidated
  basis;

      (C) a liquidation or dissolution of the Corporation;

      (D) a reorganization, reverse stock split, or recapitalization of the
  Corporation which would result in any of the foregoing; or

      (E) a transaction or series of related transactions having, directly or
  indirectly, the same effect as any of the foregoing.

                                  ARTICLE 17

                   Adjustment upon Changes in Capitalization

     Notwithstanding any other provision of the Plan, the Committee may at any
time make or provide for such adjustments to the Plan, to the number and class
of shares available thereunder or to any outstanding Options, Stock Appreciation
Rights, Restricted Shares or Performance Shares as it shall deem appropriate to
prevent dilution or enlargement of fights, including adjustments in the event of
changes in the number of shares of outstanding Common Stock by reason of stock
dividends, extraordinary cash dividends, split-ups, recapitalizations, mergers,
consolidations, combinations or exchanges of shares, separations,
reorganizations, liquidations and the like.

                                  ARTICLE 18

                           Amendment and Termination

     The Board may suspend, terminate, modify or amend the Plan, provided that
any amendment that would (i) materially increase the aggregate number of shares
which may be issued under the Plan or (ii) reduce the exercise price of options
previously
<PAGE>

granted under the Plan shall be subject to the approval of the Company's
shareholders, except that any such increase or modification that may result from
adjustments authorized by Article 16 does not require such approval. If the Plan
is terminated, the terms of the Plan shall, notwithstanding such termination,
continue to apply to awards granted prior to such termination. No suspension,
termination, modification or amendment of the Plan may, without the consent of
the associate to whom an award shall theretofore have been granted, adversely
affect the fights of such associate under such award.

                                  ARTICLE 19

                               Written Agreement

     Each award of Options, Stock Appreciation Rights, Restricted Shares,
Performance Shares, Performance Units, Unrestricted Shares and Tax Offset
Payments shall be evidenced by a written agreement, executed by the associate
and the Company, and containing such restrictions, terms and conditions, if any,
as the Committee may require. In the event of any conflict between a written
agreement and the Plan, the terms of the Plan shall govern.

                                  ARTICLE 20

                           Miscellaneous Provisions

     Section 20.1.  Fair Market Value.  For purposes of this Plan, "fair market
value" will be determined in accordance with procedures established in good
faith by the Committee.

     Section 20.2.  Tax Withholding.  The Company shall have the right to
require associates or their beneficiaries or legal representatives to remit to
the Company an amount sufficient to satisfy federal, state and local withholding
tax requirements, or to deduct from all payments under this Plan, including Tax
Offset Payments, amounts sufficient to satisfy all withholding tax requirements.
Whenever payments under the Plan are to be made to an associate in cash, such
payments shall be net of any amounts sufficient to satisfy all federal, state
and local withholding tax requirements. The Committee may, in its discretion,
permit an associate to satisfy his or her tax withholding obligation either by
(i) surrendering shares owned by the associate or (ii) having the Company
withhold from shares otherwise deliverable to the associate. Shares surrendered
or withheld shall be valued at their fair market value as of the date on which
income is required to be recognized for income tax purposes. In the case of an
award of Incentive Stock Options, the foregoing fight shall be deemed to be
provided to the associate at the time of such award.

     Section 20.3.  Compliance with Section 16(b) and Section 162(m).  In the
case of associates who are or may be subject to Section 16 of the Act, it is the
intent of the corporation that the Plan and any award granted hereunder satisfy
and be interpreted in a manner that satisfies the applicable requirements of
Rule 16b-3, so that such persons will be entitled to the benefits of Rule 16b-3
or other exemptive rules under Section 16 of the Act and will not be subjected
to liability thereunder. If any provision of the Plan or any award would
otherwise conflict with the intent expressed herein, that provision, to the
extent possible, shall be interpreted and deemed amended so as to avoid such
conflict. To the extent of any remainingirreconcilable conflict with such
intent, such provision shall be deemed void as applicable to associates who are
or may be subject to Section 16 of the Act. If any award hereunder is intended
to qualify as performance-based for purposes of Section 162(m) of the Code, the
Committee shall not exercise any discretion to increase the payment under such
award except to the extent permitted by Section 162(m) and the regulations
thereunder.

     Section 20.4.  Successors.  The obligations of the Company under the Plan
shall be binding upon any successor corporation or organization resulting from
the merger, consolidation or other reorganization of the Company, or upon any
successor corporation or organization succeeding to substantially all of the
assets and businesses of the Company. In the event of any of the foregoing, the
Committee may, at its discretion prior to the consummation of the transaction,
cancel, offer to purchase, exchange, adjust or modify any outstanding awards, at
such time and in such manner as the Committee deems appropriate and in
accordance with applicable law.
<PAGE>

     Section 20.5.  General Creditor Status.  Associates shall have no right,
title, or interest whatsoever in or to any investments which the Company may
make to aid it in meeting its obligations under the Plan. Nothing contained in
the Plan, and no action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind, or a fiduciary relationship between the
Company and any associate or beneficiary or legal representative of such
associate. To the extent that any person acquires a right to receive payments
from the Company under the Plan, such right shall be no greater than the fight
of an unsecured general creditor of the Company. All payments to be made
hereunder shall be paid from the general funds of the Company and no special or
separate fund shall be established and no segregation of assets shall be made to
assure payment of such amounts except as expressly set forth in the Plan.

     Section 20.6.  No Right to Employment.  Nothing in the Plan or in any
written agreement entered into pursuant to Article 18, nor the grant of any
award, shall confer upon any associate any right to continue in the employ of
the Company or a subsidiary or to be entitled to any remuneration or benefits
not set forth in the Plan or such written agreement or interfere with or limit
the right of the Company or a subsidiary to modify the terms of or terminate
such associate's employment at any time.

     Section 20.7.  Notices.  Notices required or permitted to be made under the
Plan shall be sufficiently made if sent by registered or certified mail
addressed (a) to the associate at the associate's address set forth in the books
and records of the Company or its subsidiaries, or (b) to the Company or the
Committee at the principal office of the Company.

     Section 20.8.  Severability.  In the event that any provision of the Plan
shall be held illegal or invalid for any reason, such illegality or invalidity
shall not affect the remaining parts of the Plan, and the Plan shall be
construed and enforced as if the illegal or invalid provision had not been
included.

     Section 20.9.  Governing Law.  To the extent not preempted by federal law,
the Plan, and all agreements hereunder, shall be construed in accordance with
and governed by the laws of the State of Delaware.

     Section 20.10. Term of Plan. Unless earlier terminated pursuant to Article
18 hereof, the Plan shall terminate on the tenth anniversary of the
Distribution.

IN WITNESS WHEREOF, the Company has caused this Second Amended and Restated 1999
Stock Option and Performance Incentive Plan to be executed by its duly
authorized officer this 22nd day of May, 2001.

                                      TOO, INC.

                                      By: /S/ Kent A. Kleeberger
                                          ------------------------
                                      Name:  Kent A. Kleeberger
                                      Title: Executive Vice President - Chief
                                             Financial Officer,
                                             Logistics and Systems
                                             Secretary and Treasurer

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