NICOR Inc.
                                             Form 10-Q
                                             Exhibit 10.02


                         NICOR Inc. 1995
                      DIRECTORS STOCK PLAN


                        TABLE OF CONTENTS


SECTION 1. . . . . . . . . . . . . . . . . . . . . . . . . . .  1
     GENERAL . . . . . . . . . . . . . . . . . . . . . . . . .  1
          1.1.  Purpose. . . . . . . . . . . . . . . . . . . .  1
          1.2.  Plan Administration. . . . . . . . . . . . . .  1
          1.3.  Applicable Law . . . . . . . . . . . . . . . .  1

SECTION 2. . . . . . . . . . . . . . . . . . . . . . . . . . .  1
     AWARDS. . . . . . . . . . . . . . . . . . . . . . . . . .  1
          2.1.  General. . . . . . . . . . . . . . . . . . . .  1
          2.2.  Definitions. . . . . . . . . . . . . . . . . .  2

SECTION 3. . . . . . . . . . . . . . . . . . . . . . . . . . .  3
     OPERATION AND ADMINISTRATION. . . . . . . . . . . . . . .  3
          3.1.  Effective Date . . . . . . . . . . . . . . . .  3
          3.2.  Shares Subject to Plan . . . . . . . . . . . .  3
          3.3.  Adjustments to Shares. . . . . . . . . . . . .  3
          3.4.  Limit on Distribution. . . . . . . . . . . . .  3

SECTION 4. . . . . . . . . . . . . . . . . . . . . . . . . . .  3
     AMENDMENT AND TERMINATION . . . . . . . . . . . . . . . .  3

                             i




                            NICOR 1995
                      DIRECTORS STOCK PLAN

                            SECTION 1

                             GENERAL

     1.1.  Purpose.  The NICOR Inc. 1995 Directors Stock Plan
(the "Plan") has been established by NICOR Inc. (the "Company")
to promote the interests of the Company and its stockholders by
enhancing the Company's ability to attract and retain the
services of experienced and knowledgeable directors and by
encouraging such directors to acquire an increased proprietary
interest in the Company.

     1.2.  Plan Administration.  The authority to control and
manage the operation and administration of the Plan shall be
vested in the Committee on Directors of the Board of Directors of
the Company (the "Committee"), whose decisions on all matters
regarding the Plan shall be final.

     1.3.  Applicable Law.  The Plan shall be construed and
administered in accordance with the laws of the State of
Illinois.

                            SECTION 2

                             AWARDS

     2.1.  General.

(a)  As of the Award Date for each Plan Year, each Director who
     is an Eligible Director both on the first day of that Plan
     Year and on such Award Date shall be granted a "Stock Award"
     for the year of 300 shares of common stock of the Company
     ("Stock"), plus a "Cash Distribution" equal to the Fair
     Market Value of such 300 share award, with the Fair Market
     Value determined as of the Award Date.  A Director shall be
     fully vested in his Stock Award and Cash Distribution upon
     receipt.

(b)  If a Director becomes an Eligible Director during a Plan
     Year, on a date other than the first day of the Plan Year,
     such Director shall not be eligible for a Stock Award for
     the year.  Instead, he shall receive cash equal to the sum
     of the Fair Market Value of the Stock Award as of the Award
     Date, plus the Cash Distribution for the year, subject to a
     pro-rata reduction to reflect the portion of the Plan Year
     prior to the date on which he becomes an Eligible Director.

(c)  If a Director ceases to be an Eligible Director during a
     Plan Year for any reason and prior to the Award Date for the
     year, he shall be entitled to no Stock Award or Cash




     Distribution for the year; provided, however, that a
     Director will not fail to receive a Stock Award or a Cash
     Distribution under this paragraph (c) if he ceases to be a
     Director by reason of death or Disability.

     2.2.  Definitions.  The following terms used in the Plan
shall be defined as follows:

(a)  The term "Award" shall mean a Cash Distribution or a Stock
     Award granted to a Director under the Plan.

(b)  The "Award Date" shall be the first business day of the
     fifth full calendar month following the first day of the
     Plan Year.

(c)  The "Board" shall be the Board of Directors of the Company. 
     A "Director" is a member of the Board, and each Director who
     is not an employee of the Company or any Related Company
     shall be an "Eligible Director".

(d)  A Director shall be considered to have a "Disability" during
     the period in which he is unable, by reason of a medically
     determinable physical or mental impairment, to engage in any
     substantial gainful activity, which condition, in the
     opinion of a physician selected by the Committee, is
     expected to have a duration of not less than 120 days.

(e)  The "Fair Market Value" of a share of Stock as of any date
     shall be the closing market composite price for such Stock
     as reported for the New York Stock Exchange - Composite
     Transactions on that date or, if Stock is not traded on that
     date, on the next preceding date on which Stock was traded.

(f)  The "Plan Year" is the period (i) beginning on the date on
     which members of the Board begin their yearly term as Board
     members following the election of Directors at the Company's
     annual stockholders meeting and (ii) ending on the day
     immediately prior to the first day of the following Plan
     Year.  The first Plan Year shall begin on the Effective
     Date.

(g)  A "Related Company" is any corporation during any period in
     which it is a Subsidiary, or during any period in which it
     directly or indirectly owns 50% or more of the total
     combined voting power of all classes of stock of the Company
     that are entitled to vote.  A "Subsidiary" is any
     corporation during any period in which 50% or more of the
     total combined voting power of all classes of stock entitled
     to vote is owned, directly or indirectly, by the Company.


                             2




                            SECTION 3

                  OPERATION AND ADMINISTRATION

     3.1.  Effective Date.  The Plan shall be effective as of the
"Effective Date", which is the date on which Directors begin
their yearly term of office on the Board following their election
at the Company's 1995 annual stockholders meeting.

     3.2.  Shares Subject to Plan.  The shares of Stock with
respect to which Stock Awards may be made under the Plan shall be
authorized and unissued shares, Treasury shares, or issued and
outstanding shares purchased in the market for that purpose.

     3.3.  Adjustments to Shares.  If the Company shall effect
any subdivision or consolidation of shares of Stock or other
capital readjustment, payment of stock dividend, stock split,
combination of shares or recapitalization or other increase or
reduction of the number of shares of Stock outstanding without
receiving compensation therefor in money, services or property,
then the Committee shall adjust the number of shares of Stock
subject to future grant.

     3.4.  Limit on Distribution.  Distribution of shares of
Stock or other amounts under the Plan shall be subject to the
following:

(a)  Notwithstanding any other provision of the Plan, the Company
     shall have no liability to deliver any shares of Stock under
     the Plan or make any other distribution of benefits under
     the Plan unless such delivery or distribution would comply
     with all applicable laws and the applicable requirements of
     any securities exchange or similar entity.

(b)  To the extent that the Plan provides for issuance of
     certificates to reflect the transfer of shares of Stock, the
     transfer of such shares may, at the direction of the
     Committee, be effected on a non-certificated basis, to the
     extent not prohibited by the provisions of Rule 16b-3,
     applicable local law, the applicable rules of any stock
     exchange, or any other applicable rules.

                            SECTION 4

                    AMENDMENT AND TERMINATION

     The Board may, at any time, amend or terminate the Plan,
provided that no amendment or termination may adversely affect
the rights of any Director or beneficiary under any Award made
under the Plan prior to the date such amendment or termination is
adopted by the Board.  Notwithstanding the provisions of this
Section 4, in no event shall the provisions of the Plan relating

                             3




to Awards under the Plan be amended more than once every six
months, other than to comport with changes in the Internal
Revenue Code of 1986, as amended, the Employee Retirement Income
Security Act, or the rules thereunder; provided, however, that
the limitation set forth in this sentence shall be applied only
to the extent required under Securities and Exchange Commission
Rule 16b-3(c)(2)(ii)(B) or any successor provision thereof.

                            4