EXHIBIT 10.2
NAUTILUS, INC.
STOCK UNIT AGREEMENT

THIS STOCK UNIT AWARD AGREEMENT (the “Agreement”), dated as of February 28, 2014
(the “Grant Date”), is made by and between Nautilus, Inc., a Washington
corporation (the “Company”), through its Board of Directors or a Committee
thereof (the “Administrator"), and Sidharth Nayar (the “Grantee”).
WHEREAS, the Company has adopted the Nautilus, Inc. 2005 Long Term Incentive
Plan, as amended (the “Plan”), pursuant to which the Company may grant Stock
Units; and
WHEREAS, the Company desires to give Grantee an opportunity to acquire or
enlarge his equity ownership in the Company for the purpose of augmenting
Grantee’s proprietary interest in the success of the Company and thereby
focusing Grantees efforts on increasing shareholder value; and
WHEREAS, the Company wishes to award Stock Units to the Grantee as provided for
herein;
NOW, THEREFORE, in consideration of the recitals and the mutual agreements
herein contained, the parties hereto agree as follows:

1.    Grant of Stock Unit Award.

1.1    In accordance with the Plan, the Company hereby grants the Grantee a
Stock Unit Award (the “Award”) representing the right to receive shares of the
Company’s common stock (“Shares”) with an aggregate value determined in
accordance with this Agreement of One Hundred Thousand Dollars $100,000 (the
“Award Amount”).
 
1.2    The provisions of the Plan are hereby incorporated herein by reference.
Except as otherwise expressly set forth herein, this Agreement shall be
construed in accordance with the provisions of the Plan and any capitalized
terms not otherwise defined in this Agreement shall have the definitions set
forth in the Plan.
1.3     The Administrator shall have final authority to interpret and construe
the Plan and this Agreement and to make any and all determinations thereunder,
and its decision shall be binding and conclusive upon Grantee and his/her legal
representative in respect of any questions arising under the Plan or this
Agreement.

2.    Vesting.

2.1    The Award shall vest and become payable as to one third (1/3) of the
total Award Amount on each of the first, second and third anniversaries of the
Grant Date (each a “Vesting Date”). On each Vesting Date, subject to Sections
2.2 through 2.4 below, Grantee shall be entitled to receive a number of Shares
equal to the quotient obtained by dividing: (i) Thirty-Three Thousand Three
Hundred Thirty-Three Dollars ($33,333) (the “Vesting Amount”) by (ii) the
average daily closing sales price per Share on the New York Stock Exchange (or
such other exchange or source of quotation on which the Shares are listed or
quoted if the Shares are not then traded on the New York Stock Exchange) (the
“Average Price”) for the twelve months preceding the applicable Vesting Date.

2.2    If (a) on or prior to the second anniversary of the Grant Date Grantee’s
employment or service with the Company is terminated without Cause (as defined
in the that certain Employment Agreement dated February 10, 2014 by and between
Company and Grantee (the “Employment Agreement”)), or Grantee resigns for Good
Reason (as defined in the Employment Agreement), or (b) Grantee’s employment or
service with the Company is terminated as a result of Grantee’s death, then the
unvested portion of the Award shall immediately become vested and Grantee shall
be entitled to receive a number of Shares equal to the quotient obtained by
dividing: (i) the unpaid portion of the Award Amount by (ii) the Average Price
for the twelve months preceding the date of such termination.

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2.3    Upon the occurrence of any Corporate Event (as defined below) the
unvested portion of the Award shall immediately become vested and Grantee shall
be entitled to receive a number of Shares equal to the quotient obtained by
dividing: (i) the unpaid portion of the Award Amount by (ii) the Average Price
for the twelve months preceding the day immediately prior to the effectiveness
of the Corporate Event. For purposes hereof, the term “Corporate Event” means
the occurrence of any of the following events: (A) the sale, liquidation or
other disposition of all or substantially all of the Company’s assets, other
than to a related person (as described in Treas. Reg. 1.409A‑3(i)(5)(vii)(B));
(B) a merger or consolidation of the Company with one or more corporations as a
result of which, immediately following such merger or consolidation, the
shareholders of the Company as a group hold less than a majority of the
outstanding capital stock of the surviving corporation; or (C) any person or
entity, including any “person” as such term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), becomes the
“beneficial owner”, as defined in the Exchange Act, of shares of the Company’s
common stock representing fifty percent (50%) or more of the combined voting
power of the voting securities of the Company.

2.4     Except as expressly provided in Section 2.2 and Section 2.3, if
Grantee's employment or service with the Company terminates for any reason prior
to a Vesting Date, then Grantee shall forfeit all rights, title, and interest in
and to that portion of the Award which has not vested as of the date of such
termination. Neither Grantee nor any of Grantee's successors, heirs, assigns or
personal representatives shall have any rights or interests in any portion of
the Award that is so forfeited.    

3.    Terms and Conditions of Award.

The Award shall be subject to the following terms, conditions and restrictions:

3.1    Prior to the issuance and delivery of Shares in settlement of the Award
on a Vesting Date or pursuant to Sections 2.2 or 2.3 the Grantee shall have no
rights as a stockholder of the Company, no dividend rights and no voting rights
with respect to any Shares issuable pursuant to this Award.

3.2    The rights represented by this Award may not be transferred in any manner
except as expressly permitted by the Plan. The terms of the Plan and this
Agreement shall be binding upon the executors, administrators, heirs, successors
and assigns of the Grantee.

4.    Delivery of Shares.    

4.1    As soon as administratively practicable after the date upon which any
portion of the Award vests, and provided Grantee shall have paid the Withholding
Liability to the Company pursuant to Section 5 hereof, the Company shall issue
to Grantee or, at Grantee’s request, Grantee’s designated broker, the number of
Shares determined in accordance with Section 2.1, Section 2.2 or Section 2.3, as
applicable, free and clear of any restrictions in settlement of the vesting
portion of the Award.

5.    Income Taxes.

5.1    The Grantee shall be liable for all applicable income and withholding
taxes, including without limitation, any federal, state, local or other income
taxes, or any FICA, state disability insurance tax or other employment tax
(“Withholding Taxes”) with respect to any compensation income arising out of the
award, vesting and settlement hereunder.

5.2    If the Company becomes obligated to withhold an amount on account of any
Withholding Taxes imposed in connection with the vesting or settlement of the
Award, Grantee shall, on the date the Shares are issued, or such other date upon
which the Company becomes so obligated to withhold (the “Withholding Date”), pay
such amount (the “Withholding Liability”) to the Company in cash or check
payable to the Company.

5.3    If Grantee does not pay such Withholding Liability to the Company on or
before the Withholding Date, Grantee hereby authorizes the Company to withhold
and/or reacquire from the earned award such number of whole shares as have an
aggregate Fair Market Value on the date that the amount of tax to be withheld is
to be determined as equals the amount of withholding tax so payable (the “Net
Share Settlement”). Such withholding obligation shall be determined based on any
applicable minimum statutory withholding rates. The Grantee will receive a cash
refund for any fraction of a surrendered share not necessary for required
Withholding Taxes.

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5.4    In the event the Company cannot (under applicable legal, regulatory,
listing or other requirements, or otherwise) satisfy such Withholding Liability
in such methods as described in Sections 5.2 and 5.3, the Company may satisfy
such withholding by deducting such amount out of any other compensation
otherwise payable to the Grantee. Grantee hereby consents to the Company
withholding the full amount of the Withholding Liability from any compensation
or other amounts otherwise payable to Grantee (including, without limitation,
any Shares issuable in settlement of the Award) if Grantee does not pay the
Withholding Liability to the Company on the Withholding Date, and Grantee agrees
that the withholding and payment of any such amount by the Company to the
relevant taxing authorities shall constitute full satisfaction of the Company’s
obligation to pay such compensation of other amounts to Grantee.

5.5    Regardless of any action the Company takes with respect to any or all
Withholding Liability, the Grantee acknowledges and agrees that the ultimate
liability for all Withholding Liability legally due from Grantee is and remains
the Grantee’s responsibility.

6.
Miscellaneous Provisions.

6.1    Notices. Any notices, designations, consents, offers, acceptances and any
other communications required or permitted hereunder shall be given in writing
and shall be delivered either personally or by registered or certified mail,
postage prepaid, which shall be addressed, in the case of the Company to the
principal office of the Company and, in the case of the Grantee, to the
Grantee's address appearing on the books of the Company or to the Grantee's
residence or to such other address as may be designated in writing by the
Grantee.
6.2     Invalid Provision. The invalidity or unenforceability of any particular
provision thereof shall not affect the other provisions hereof, and this
Agreement shall be construed in all respects as if such invalid or unenforceable
provision had been omitted.
6.3     Modifications. No change, modification or waiver of any provision of
this Agreement shall be valid unless the same is in writing and signed by the
parties hereto.
6.4     Entire Agreement. This Agreement sets forth the entire agreement and
understanding of the parties with respect to the subject matter contained herein
and supersedes all prior communications, representations and negotiations in
respect thereto.
6.5    Governing Law. This agreement shall be interpreted and construed in
accordance with the laws of the State of Washington.
 
    

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IN WITNESS WHEREOF, the Company and the Grantee have executed this Stock Unit
Award Agreement as of the date first set forth above.

NAUTILUS, INC.

By: /s/ Bruce Cazenave        
Name: Bruce Cazenave
Title: Chief Executive Officer

GRANTEE

/s/ Sidharth Nayar        
Sidharth Nayar