EMPLOYMENT AGREEMENT


       THIS EMPLOYMENT  AGREEMENT is made as of November 1, 2002, by and between
VARSITY  BRANDS,  INC.,  a Delaware  corporation  (the  "Company"),  and JOHN M.
NICHOLS (the "Executive").

       WHEREAS,  pursuant to an  Employment  Agreement  dated as of September 1,
1999 (the "Former  Agreement"),  the  Executive  was employed as the Senior Vice
President and Chief Financial Officer of Varsity Spirit Corporation, a Tennessee
corporation  ("Varsity  Spirit") and, at the time, a wholly owned  subsidiary of
Riddell Sports, Inc., a Delaware corporation,  Varsity Spirit having merged with
and into a subsidiary of Riddell  Sports,  Inc. as of June 20, 1997 (the "Merger
Date");

       WHEREAS, following such merger, the Executive also served as an executive
officer of Riddell Sports, Inc.;

       WHEREAS,  as of September  2001,  the corporate  name of Riddell  Sports,
Inc., was changed to Varsity  Brands,  Inc. and the Company  currently  operates
under such corporate name; and

       WHEREAS,  the parties desire to enter into this  Agreement  setting forth
the terms and  conditions of the employment  relationship  of the Executive with
the Company.

       NOW, THEREFORE, the parties agree as follows:

       1.     EMPLOYMENT.  The Company  hereby  employs the  Executive,  and the
Executive hereby accepts employment with the Company, upon the terms and subject
to the conditions set forth herein.

       2.     TERM.  This  Agreement  is  for a  two-year  period  (the  "Term")
commencing as of November 1, 2002 (the "Effective Date") and, unless terminated,
extended  or renewed by the  parties,  shall  expire on  October  31,  2004 (the
"Expiration  Date").  The Company shall notify Executive no later than April 30,
2004 whether it wishes to extend or renew this Agreement, either pursuant to the
same or different terms. In the event that the Company shall so notify Executive
(the "Extension Notification"),  each of the Company and Executive shall seek to
renew or extend this  Agreement  prior to the  Expiration  Date,  upon  mutually
agreed to terms and conditions.

       3.     POSITION.  During the Term,  the  Executive  shall serve as Senior
Vice President and Chief Financial Officer of the Company.

       4.     DUTIES AND REPORTING RELATIONSHIP.  During the Term, the Executive
shall, on a full-time  basis,  use his skills and render services to the best of
his abilities in  supervising  and  conducting  the financial  operations of the
Company.  As part of his duties the Executive  shall be responsible for and have
supervisory control over the financial operations of the Company and

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shall report to, and be subject to supervision by, the Company's Chief Executive
Officer.  The  Executive  will also perform such other duties for the Company as
are consistent with his position as the Chief Executive Officer shall reasonably
assign.  Nothing in this Agreement shall be deemed to prevent the Executive from
participating  in, or serving on (a) the governing body of any civic,  community
or  charitable  organization  with  which  the  Executive  may  currently  be or
hereafter  become  involved,  or (b) the board of directors or governing body of
another business entity;  PROVIDED,  HOWEVER, that such participation or service
may not interfere with Executive performing his duties hereunder.

       5.     PLACE OF  PERFORMANCE.  The Executive shall perform his duties and
conduct  his  business  at the  principal  offices of the  Company  in  Memphis,
Tennessee except for reasonably required travel on the Company's business.

       6.     INDUCEMENT FOR EMPLOYMENT.

              (a)    The Company has previously granted to the Executive options
(the "Options") pursuant to the Company's 1997 Stock Option Plan (the "Plan") to
purchase  (i) up to  35,000  shares of common  stock,  $0.01 par value  ("Common
Stock"),  of the Company at an original  exercise price of $5.42 per share, (ii)
up to 13,500 shares of Common Stock at an original  exercise price of $5.375 per
share,  (iii) up to 10,000 shares of Common Stock at an original  exercise price
of $3.125 per share, and (iv) up to 10,000 shares of Common Stock at an original
exercise  price of $4.81 per  share,  such  exercise  prices  being  subject  to
adjustment  as set forth in the  respective  Options and the Plan.  Such Options
continue in effect as of the date hereof.

              (b)    The Options are hereby amended by the Company and Executive
to provide that such Options each expire on the earlier of the tenth anniversary
of the  Grant  Date or three  (3)  months  following  the  date the  Executive's
employment  is terminated  for any reason other than for Cause.  The Options are
hereby amended by the Company and Executive to provide that each such Option may
be exercised (to the extent it has vested) at any time prior to such expiration;
PROVIDED, HOWEVER, that if, (i) prior to the expiration of the Term, the Company
terminates  the  Executive's  employment  in breach of this  Agreement,  or (ii)
subsequent to the expiration of the Term, the Company terminates the Executive's
employment  in a manner that would have been a breach of this  Agreement had the
Term not expired, then the Options shall become fully vested and exercisable and
shall  remain  exercisable  for a  period  of  six  (6)  months  following  such
termination of  employment;  and,  provided  further,  that, if the  Executive's
employment  is  terminated  on account of his death or  Disability  (as  defined
below),  then upon such  termination  the Options  shall become fully vested and
exercisable  and  shall  remain  exercisable  for a  period  of six  (6)  months
following such termination of employment.  The Options shall become fully vested
and exercisable  upon the occurrence of a Change in Control  (defined below) and
shall remain  exercisable for a period of six (6) months  following  Executive's
termination of employment upon or after a Change of Control.

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       7.     SALARY AND ANNUAL BONUS.

              (a)    BASE SALARY.  During the Term, the Executive's  base salary
(the "Base  Salary")  hereunder  shall be no less than Two Hundred Ten  Thousand
Dollars ($210,000) per year, payable no less often than in monthly installments.
The Base Salary shall be subject to review and increase by an amount  determined
by  the   Compensation   Committee  of  the  Company  Board  after  taking  into
consideration the Executive's performance, the Company's performance,  increases
in the cost of  living  and such  other  factors  as the  Company  Board or such
committee  deems  relevant,  which review shall be conducted no less  frequently
than once during any  calendar  year at the same time the Company  conducts  its
review of the compensation of the Company's other senior executive officers.  In
addition, in the event and to the extent that the Company actually increases the
salary of any other  executive  employees of the Company to take into account an
increase in the Consumer Price  Index-Urban  Consumer as reprinted by the Bureau
of Labor  Statistics of the U.S.  Department of Labor ("CPI") or any superseding
index or report whether published by the U.S.  Department of Labor or otherwise,
Executive's Base Salary shall automatically be similarly increased.

              (b)    ANNUAL  BONUS.   During  the  Term,   the  Executive   will
participate  in any bonus plan  established  by the Company at a target level of
thirty-five  percent  (35%) of his Base  Salary.  Such bonus shall be payable at
such time as bonuses are paid to other senior executive officers who participate
therein.

       8.     VACATION,  HOLIDAYS AND SICK LEAVE. During the Term, the Executive
shall be entitled to paid  vacation,  paid holidays and sick leave in accordance
with the Company's  standard policies for its senior executive  officers,  which
policies  shall provide the Executive  with (a) benefits no less  favorable than
those provided to any other senior  executive  officer of the Company and (b) no
fewer than four (4) weeks of paid  vacation per year,  unless  otherwise  agreed
between the Executive and the Company.

       9.     BUSINESS  EXPENSES.   During  the  Term,  the  Executive  will  be
reimbursed for all ordinary and necessary  business  expenses incurred by him in
connection  with his  employment  upon timely  submission  by the  Executive  of
receipts and other documentation as required by the Internal Revenue Code and in
conformance  with the Company's  normal  procedure;  the  determination  of such
reimbursement  to also be consistent  with the  Company's  past  practices  with
respect to the Executive.

       10.    PENSION AND WELFARE BENEFITS. During the Term, the Executive shall
be eligible to participate  fully in all health  benefits,  insurance  programs,
pension  and  retirement  plans  and other  employee  benefit  and  compensation
arrangements  (collectively,  the "Employee  Benefits") available to officers of
the Company generally,  which Employee Benefits shall provide the Executive with
benefits no less  favorable  than those  provided to any other senior  executive
officer of the Company. The Executive's service with Varsity Spirit prior to the
Merger  Date  shall  be  taken  into  account  for the  purpose  of  determining
eligibility for  participation  and vesting (but not benefit  accrual) under any
such employee  plan,  program or policy to the same extent that service with the
Company is so taken into account for the executives of the Company.

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       11.    TERMINATION OF EMPLOYMENT.

              (a)    GENERAL.  The  Executive's   employment  hereunder  may  be
terminated  without any breach of this  Agreement  only under the  circumstances
provided in this paragraph 11(a).

                     (i)    DEATH OR DISABILITY.

                            (A)    The  Executive's  employment  hereunder shall
automatically terminate upon the death of the Executive.

                            (B)    If, as a result of the Executive's incapacity
due to physical or mental illness, the Executive shall be "Disabled" for any six
(6) months (whether or not consecutive) during any twelve (12) month period, the
Executive's employment hereunder may thereafter be terminated by the Company for
"Disability."  For purposes of this Agreement,  the Executive shall be deemed to
be "Disabled"  if, during the period  referred to in the  immediately  preceding
sentence  (i)  his  condition  is such  that it  would  have  qualified  him for
disability  benefits under the Company's  long-term  disability plan, or (ii) he
had a physical or mental  disability  which  rendered him  incapable,  after the
provision of reasonable  accommodations,  of performing substantially all of his
duties  hereunder.  In the event of a dispute as to  whether  the  Executive  is
Disabled,  the Company may, at its expense,  refer him to a licensed  practicing
physician of the  Company's  choice and the  Executive  agrees to submit to such
tests and examination as such physician shall deem appropriate.

                     (ii)   CAUSE. The Executive's  employment  hereunder may be
terminated  for Cause.  For purposes of this  Agreement,  "Cause" shall mean (A)
gross  neglect  by  the  Executive  of the  Executive's  duties  hereunder,  (B)
conviction of the Executive of any felony,  (C) gross or intentional  misconduct
by the Executive in connection with the  performance of any material  portion of
the Executive's duties hereunder, or (D) breach by the Executive of any material
portion of this Agreement (including, but not limited to, Sections 15, 16 and 17
hereof)  or of any  other  material  agreement  between  the  Executive  and the
Company.

                     (iii)  VOLUNTARY RESIGNATION.  Should the Executive wish to
resign from his position  provided for herein or terminate his employment  other
than in connection with, or following,  a Change in Control during the Term, the
Executive  may do so by giving  sixty (60) days'  written  notice to the Company
setting forth the reasons and specifying the date as of which his resignation is
to become effective.

                     (iv)   CHANGE IN CONTROL.  The Executive  shall be entitled
to terminate his employment  upon the occurrence of, or any time after, a Change
in Control. For purposes of this Agreement, a "Change in Control" shall mean the
occurrence of any of the following: (a) a majority of the members of the Company
Board are representatives or designees of any "Person" or "Group" (as such terms
are used in Section 13(d) and 14(d) of the  Securities  Exchange Act of 1934, as
amended (the "Exchange Act"), excluding Robert E. Nederlander,  Leonard Toboroff
and  John  McConnaughy,  Jr.  and/or  entities  controlled  by such  individuals
(collectively, the "Nederlander/Toboroff/McConnaughy  Group"), provided that any
such representatives or


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designees  of the  Nederlander/Toboroff/McConnaughy  Group  shall be their  good
faith, bona fide  representatives  and designees who are not otherwise nominated
in  contemplation  of or in connection  with a transaction  that would otherwise
constitute a Change in Control hereunder;  it being understood that it shall not
be deemed to be a Change in Control if no Person or Group shall have  designated
or nominated a majority of the members of the Company Board; (b) any "Person" or
"Group" is or becomes the "beneficial owner" (as defined in Rule 13D-3 under the
Exchange  Act as in effect on the date  hereof,  except  that a person  shall be
deemed to be the "beneficial  owner" of all shares that any such Person or Group
has the right to  acquire  pursuant  to any  agreement  or  arrangement  or upon
exercise of conversion rights, warrants, options or otherwise, without regard to
the sixty (60) day period referred to in such Rule), directly or indirectly,  of
securities  representing  more than fifty percent  (50%) of the combined  voting
power of the  Company's  then  outstanding  securities,  (c) the  Company  shall
consolidate,  merge  or  exchange  securities  with  any  other  entity  and the
stockholders  of the  Company  immediately  before  the  effective  time of such
transaction do not  beneficially  own,  immediately  after the effective time of
such transaction,  shares entitling such stockholders to a majority of all votes
(without  consideration  of the rights of any class of stock  entitled  to elect
directors by a separate class vote) to which all stockholders of the corporation
issuing cash or securities in the consolidation,  merger or share exchange would
be entitled  for the purpose of electing  directors,  or (d) any Person or Group
acquires  more  than  fifty  percent  (50%) by value  of the  Company's  assets.
Notwithstanding  anything  set forth herein to the  contrary,  in the event that
immediately  subsequent  to the  occurrence  of any of the  events  set forth in
Sections  11(a)(iv)(b)  through  (d),  (i) the Company is an entity whose equity
securities are  registered  under Section 12(b) or 12(g) of the Exchange Act, or
the Company is a reporting  entity under  Section 15(d) of the Exchange Act as a
result of its outstanding  equity  securities,  and (ii) no Person or Group owns
shares of the Company  representing more than seventy-five  percent (75%) of all
shares  entitled  to  vote  for  the  purpose  of  electing  directors  (without
consideration of the rights of any class of stock entitled to elect directors by
a separate  class  vote),  then for  purposes  of this  Agreement,  no Change in
Control shall be deemed to have occurred.

              (b)    NOTICE OF  TERMINATION.  Any purported  termination  of the
Executive's  employment by the Company or by the Executive shall be communicated
by written Notice of  Termination  to the other party hereto in accordance  with
Section 21. "Notice of Termination"  shall mean a notice that shall indicate the
specific termination provision in this Agreement relied upon and shall set forth
in reasonable detail the facts and circumstances  claimed to provide a basis for
termination of the Executive's employment under the provision so indicated.

              (c)    DATE OF TERMINATION.  "Date of Termination"  shall mean (i)
if the Executive's  employment is terminated  because of death,  the date of the
Executive's  death,  (ii)  if  the  Executive's  employment  is  terminated  for
Disability,  the  date  the  Notice  of  Termination  is  given,  (iii)  if  the
Executive's employment is terminated pursuant to Subsection 11(a)(ii),  (iii) or
(iv) hereof or for any other reason (other than death or  Disability),  the date
specified in the Notice of Termination (which shall not be less than thirty (30)
days  from  the  date  such  Notice  of  Termination  is  given in the case of a
termination under Section 11(a)(ii) hereof (other than Section 11 (a)(ii)(B), in
which event,  notice  shall not be less than five (5) days),  sixty (60) days in
the case of a termination under Section  11(a)(iii) hereof, and ten (10) days in
the case of a

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termination  under  Section  11(a)(iv)  hereof).  The  Agreement  shall  not  be
terminated  under  Subsections  11(a)(ii)(A),  (C) or (D) if the Executive cures
such breach prior to the effective date of  termination  set forth in the Notice
of Termination.

              (d)    OUTPLACEMENT  SERVICES.  If, (i) prior to the expiration of
the Term, the Company  terminates the  Executive's  employment in breach of this
Agreement or the Executive  terminates his employment upon or following a Change
in  Control,  or (ii)  subsequent  to the  expiration  of the Term,  the Company
terminates the Executive's employment in a manner that would have been in breach
of this  Agreement  had the Term not  expired or the  Executive  terminates  his
employment upon or following a Change in Control had the Term not expired,  then
the Executive  shall be entitled to the services of an  outplacement  firm for a
period of six (6) months following such  termination,  which  outplacement  firm
shall be selected by the  Executive  and the  reasonable  fees and  expenses for
which shall be paid by the Company.

       12.    COMPENSATION   DURING   DISABILITY,   OR  UPON   DEATH   OR  OTHER
              TERMINATION.

              (a)    During any period that the  Executive  fails to perform his
duties  hereunder as a result of incapacity  due to physical or mental  illness,
the Executive  shall continue to receive (i) his full salary at the rate then in
effect until his employment is terminated pursuant to Section 11(a)(i)(B) hereof
and (ii) a pro rata portion of his bonus that would have been  payable  pursuant
to Section 7(b) above with respect to the calendar year in which the termination
pursuant to Section  11(a)(i)(B)  occurs  provided that such  payments  shall be
reduced by the sum of the amounts, if any, paid to the Executive with respect to
such period under  disability  benefit  plans of the Company or under the Social
Security  disability  insurance  program,  and which amounts were not previously
applied to reduce any such payment.

              (b)    If the Executive's employment is terminated by his death or
Disability,  the Company  shall pay (i) any amounts due to the  Executive  under
Section 7 through the Date of  Termination  (including a pro rata portion of his
bonus, if any, that would have been payable  pursuant to Section 7(b) above with
respect to the calendar year in which the termination  occurs) and (ii) his Base
Salary  that would  have  become  due (and at the time such  amounts  would have
become due) to the  Executive  under  Section 7 had the  Executive's  employment
hereunder continued for a period of one year after the Date of Termination.

              (c)    If the  Executive's  employment  shall be terminated by the
Company for Cause,  or by the Executive other than upon or following a Change in
Control, the Company shall pay the Executive his full Base Salary, under Section
7, and benefits  through the Date of Termination as in effect at the time Notice
of  Termination is given,  and the Company shall have no further  obligations to
the Executive  under this  Agreement,  except as otherwise  provided,  including
Section 16.

              (d)    If the Company shall terminate the  Executive's  employment
in breach of this Agreement, then

                            (A)    the Company  shall pay the  Executive (x) his
full salary,  under  Section 7, through the Date of  Termination  at the rate in
effect at the time Notice of

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Termination  is  given,  (y) all  other  unpaid  amounts,  if any,  to which the
Executive is entitled as of the Date of Termination  under any compensation plan
or program of the Company,  at the time such payments are due and (z) a pro rata
portion of the bonus that would have been payable to the  Executive  pursuant to
Section  7(b)  above  with  respect  to the  calendar  year in which the Date of
Termination  occurs had the  Executive's  employment  not terminated at the time
such bonus would otherwise have become payable; and

                            (B)    the Company  shall also (i) pay to  Executive
on the Date of  Termination  a lump sum payment  equal to fifty percent (50%) of
Executive's Base Salary then in effect plus fifty percent (50%) of his bonus, if
any,   relating  to  the  calendar  year  immediately   preceding  the  Date  of
Termination,  and (ii) pay to  Executive  his Base  Salary  then effect plus his
bonus, if any,  relating to the calendar year immediately  preceding the Date of
Termination,  in eighteen (18) equal monthly installments commencing on the Date
of Termination; and

                            (C)    the Company shall, on terms no less favorable
to the  Executive  than if the  Executive  had  continued  in the  employ of the
Company,  (x)  continue  coverage for the  Executive  under the  Company's  life
insurance, medical, health, disability and similar welfare benefit plans (or, if
continued  coverage is barred under such plans, the Company shall provide to the
Executive  substantially  similar benefits) for the period beginning on the Date
of  Termination  and  continuing  for  eighteen  (18)  months   thereafter  (the
"Continuation  Period"),  and (y) provide the benefits which the Executive would
have been  entitled to receive  pursuant  to any  supplemental  retirement  plan
maintained  by  the  Company  had  his  employment  continued  at  the  rate  of
compensation  specified herein for the Continuation  Period.  Benefits otherwise
receivable by the Executive  pursuant to clause (x) of this Subsection  12(d)(C)
shall be reduced to the extent comparable  benefits are actually received by the
Executive from a subsequent  employer (at such  subsequent  employer's  expense)
during the Continuation Period, and the Executive shall report any such benefits
actually received to the Company.

              (e)    If (i) the Executive  shall terminate his employment upon a
Change in Control,  (ii) the Company shall terminate the Executive's  employment
upon a Change in  Control,  (iii) the  Company  shall  consummate  a "Change  in
Control  Transaction" (as that term is defined in Section 12(e)(C) below) at any
time during or after the expiration of this Agreement,  discussions with respect
to which commenced during the Term of this Agreement,  and the Company had given
the Extension  Notification,  or (iv) the Company  shall  consummate a Change in
Control  Transaction at any time during the Term of this Agreement or within six
(6) months after the expiration of this Agreement,  discussions  with respect to
which commenced during the Term of this Agreement,  and the Company did not give
the Extension Notification; then

                            (A)    the Company  shall pay the  Executive (x) his
full Base Salary,  under Section 7, through the Date of  Termination at the rate
in  effect at the time  Notice of  Termination  is given,  (y) all other  unpaid
amounts,  if  any,  to  which  the  Executive  is  entitled  as of the  Date  of
Termination under any compensation  plan or program of the Company,  at the time
such  payments  are due and (z) a pro rata  portion of the bonus that would have
been payable to the Executive pursuant to Section 7(b) above with respect to the
calendar  year in  which  the Date of  Termination  occurs  had the  Executive's
employment  not  terminated at the time such bonus would  otherwise  have become
payable; and

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                            (B)    the Company  shall also pay to Executive  (i)
in a lump sum due on the Date of Termination,  an amount equal to the sum of the
Executive's  annual Base Salary then in effect plus  Executive's  bonus, if any,
relating to the calendar year  immediately  preceding  the Date of  Termination;
(ii) an amount equal to forty percent (40%) of Executive's Base Salary as of the
Date of  Termination  plus forty percent  (40%) of  Executive's  bonus,  if any,
relating to the calendar year  immediately  preceding the Date of Termination in
twelve (12) equal monthly installments  commencing as of the Date of Termination
and ending on the one (1) year anniversary thereof, and (iii) an amount equal to
ten percent (10%) of the  Executive's  Base Salary as of the Date of Termination
plus ten percent (10%) of Executive's  bonus,  if any,  relating to the calendar
year immediately  preceding the Date of Termination in twelve (12) equal monthly
installments  commencing on the  thirteenth  (13th) month  following the date of
Termination and ending on the twenty-fourth (24th) month thereafter.

                            (C)    It is  expressly  understood  and agreed that
notwithstanding  anything  set forth herein to the  contrary,  in the event that
Executive,  upon a transaction that constitutes a Change in Control (the "Change
in Control  Transaction"),  continues  to be  employed  by the  Company  (or its
successor-in-interest,  if applicable),  then Executive shall not be entitled to
receive  any of the  consideration  referred  to in Section  12(e)(A) or Section
12(e)(B)  above  solely  with  respect to such  Change in  Control  Transaction;
PROVIDED, HOWEVER, that Executive shall be entitled to receive the consideration
referred to in Section 12(e)(A) and 12(e)(B) above, in accordance with the terms
and  conditions  thereof,  pursuant  to  any  subsequent,  separate  event  that
constitutes  a Change in Control  following  the  consummation  of the Change in
Control Transaction.

                            (D)    the Company shall, on terms no less favorable
to the  Executive  than if the  Executive  had  continued  in the  employ of the
Company,  (x)  continue  coverage for the  Executive  under the  Company's  life
insurance, medical, health, disability and similar welfare benefit plans (or, if
continued  coverage is barred under such plans, the Company shall provide to the
Executive  substantially  similar benefits) for the Continuation Period, and (y)
provide the benefits  which the  Executive  would have been  entitled to receive
pursuant to any  supplemental  retirement plan maintained by the Company had his
employment  continued  at the  rate of  compensation  specified  herein  for the
Continuation Period.  Benefits otherwise receivable by the Executive pursuant to
clause (x) of this Subsection 12(e)(D) shall be reduced to the extent comparable
benefits are actually  received by the Executive from a subsequent  employer (at
such subsequent  employer's  expense) during the  Continuation  Period,  and the
Executive shall report any such benefits actually received to the Company; and

                            (E)    the  parties   agree  that  any  payments  to
Executive under this Section 12(e) which are contingent upon a Change in Control
be limited  to the  maximum  amount  which  would not  result in the  payment to
Executive  of an  "excess  parachute  payment"  (within  the  meaning of Section
280G(b)(1) of the Internal  Revenue Code of 1986, as amended (the  "Code")),  it
being the intent of the parties  that all  payments to  Executive  hereunder  be
fully  deductible by the Company and that Executive not be subject to any excise
tax under Code Section 4999.  The Company and Executive  agree that prior to the
payment  to  Executive  of any  amounts  which are  contingent  upon a Change in
Control, the Company's regular outside auditor

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<PAGE>


shall  review the  payments  and advise the Company and the  Executive as to the
amount  of such  payments,  if  any,  which  will  constitute  excess  parachute
payments.

              (f)    In the  event  of the  expiration  of this  Agreement,  the
Company shall pay (i) any amounts due to the  Executive  under Section 7 through
the date of such  expiration  (including  a pro rata  portion  of his bonus that
would  have been  payable  pursuant  to Section  7(b) above with  respect to the
calendar  year in which the  expiration  occurs) and (ii) all such  amounts that
would have  become due (and at the time such  amounts  would have become due) to
the Executive under Section 7 had the Executive's employment hereunder continued
for a period of one year after the date upon which such expiration of employment
occurred.  In addition,  the Company  shall,  on terms no less  favorable to the
Executive than if the Executive had continued in the employ of the Company,  (x)
continue coverage for the Executive under the Company's life insurance, medical,
health,  disability and similar welfare benefit plans (or, if continued coverage
is  barred  under  such  plans,  the  Company  shall  provide  to the  Executive
substantially similar benefits) for the Continuation Period, and (y) provide the
benefits which the Executive would have been entitled to receive pursuant to any
supplemental  retirement  plan  maintained  by the  Company  had his  employment
continued  at the rate of  compensation  specified  herein for the  Continuation
Period. Benefits otherwise receivable by the Executive pursuant to clause (x) of
this  Subsection  12(f) shall be reduced to the extent  comparable  benefits are
actually  received  by  the  Executive  from  a  subsequent  employer  (at  such
subsequent employer's expense) during the Continuation Period, and the Executive
shall report any such benefits actually received to the Company.

       13.    REPRESENTATIONS.

              (a)    The Company represents and warrants that this Agreement has
been  authorized  by all necessary  corporate  action and is a valid and binding
agreement of the Company enforceable against it in accordance with its terms.

              (b)    The  Executive  represents  and  warrants  that he is not a
party to any agreement or instrument  which would prevent him from entering into
or performing his duties in any way under this Agreement.

       14.    SUCCESSORS; BINDING AGREEMENT.

              (a)    The Company will require any successor  (whether  direct or
indirect,   by  purchase,   merger,   consolidation  or  otherwise)  to  all  or
substantially  all of the business and/or assets thereof to expressly assume and
agree to perform  this  Agreement in the same manner and to the same extent that
the  Company  would be required  to perform it if no such  succession  had taken
place.

              (b)    This  Agreement  is a personal  contract and the rights and
interests of the  Executive  hereunder may not be sold,  transferred,  assigned,
pledged,  encumbered,  or  hypothecated  by him,  except as otherwise  expressly
permitted by the provisions of this Agreement. This Agreement shall inure to the
benefit  of and be  enforceable  by the  Executive  and his  personal  or  legal
representatives, executors, administrators, successors, heirs,

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<PAGE>


distributees,  devisees  and  legatees.  If the  Executive  should die while any
amount would still be payable to him hereunder  had the  Executive  continued to
live  all  such  amounts  shall be paid in  accordance  with  the  terms of this
Agreement  to his  devisee,  legatee or other  designee  or, if there is no such
designee, to his estate.

       15.    CONFIDENTIALITY.  The Executive  covenants and agrees that he will
not at any time during and after the end of the Term,  directly  or  indirectly,
use for his own account, or disclose to any person,  firm or corporation,  other
than  authorized  officers,  directors  and  employees  of  the  Company  or its
subsidiaries,  Confidential Information (as hereinafter defined) of the Company.
As used herein,  "Confidential  Information" of the Company means information of
any kind,  nature or description which is disclosed to or otherwise known to the
Executive  as a direct  or  indirect  consequence  of his  association  with the
Company or its  subsidiaries,  which  information is not generally  known to the
public or to the businesses in which the Company or its subsidiaries are engaged
or which information  relates to specific  investment  opportunities  within the
scope of the Company's  business  which were  considered by the Executive or the
Company during the term of this Agreement.

       16.    NONCOMPETITION.  During his employment  with the Company or any of
its  affiliates,  and for the  Continuation  Period,  which,  in the  event of a
termination  or expiration of this  Agreement as a result of a Change in Control
shall be deemed to be an additional  six (6) months (the  "Noncompete  Period"),
the Executive shall not, directly or indirectly,  enter the employ of, or render
any services to, any person,  firm or corporation  engaged in any business which
competes in the business conducted or engaged in by the Company (during the Term
or on the Date of Termination,  as the case may be) (the "Business")  including,
but not limited to, any  business  which  provides  products and services to the
school spirit industry (including but not limited to design,  marketing or sales
of cheerleader, dance team and booster club uniforms and accessories and design,
operation  or  marketing  of   cheerleader   and  dance  team  camps,   clinics,
competitions  or tours);  and the Executive  shall not become  interested in any
such business, directly or indirectly, as an individual,  partner,  shareholder,
director, officer,  principal,  agent, employee, trustee,  consultant, or in any
other relationship or capacity; PROVIDED, HOWEVER, that (A) nothing contained in
this Section 16 shall be deemed to prohibit the Executive from acquiring, solely
as an investment,  up to five percent (5%) of the outstanding  shares of capital
stock  of  any  public  corporation;  and  (B) if  any  compensation  due to the
Executive  under  Section 12 hereof is not paid,  the  Noncompete  Period  shall
terminate upon failure to cure such non-payment  after fifteen (15) days' notice
(which  termination  shall not relieve the Company of its  obligation to pay any
amounts due hereunder).  Notwithstanding anything in this Section 16 and Section
12(c) to the  contrary,  the  foregoing  provisions of this Section 16 shall not
apply to the  Executive  after the  termination  of the  Executive's  employment
unless the Company shall have paid all compensation due to Executive as provided
in Section 12 hereof.

       17.    NONSOLICITATION. During the Noncompete Period, the Executive shall
not,  directly  or  indirectly,  for his benefit or for the benefit of any other
person, firm or entity, do any of the following:

              (a)    solicit  from any known  potential  customer of the Company
business of the same or of a similar  nature (with  respect to the  Business) to
that which has been the subject of a

                                       10
<PAGE>


known written or oral bid,  offer or proposal by the Company,  or of substantial
preparation with a view to making such a bid, proposal or offer,  within six (6)
months prior to the  expiration or Date of Termination  hereof;

              (b)    solicit the  employment of services of, or hire, any person
who, upon the Date of Termination or expiration of the  Executive's  employment,
or within six (6) months  prior  thereto,  was known to be (i)  employed  by the
Company or (ii) a consultant to the Company with respect to the Business; or

              (c)    otherwise   directly  or  indirectly   interfere  with  the
Business  or  accounts  of the  Company in a manner  which  directly  results in
material harm (economic or otherwise) to the Company or any of its affiliates.

       18.    INDEMNIFICATION.  The Company shall  indemnify the Executive  from
and against any  threatened,  pending or completed  action,  suit or proceeding,
whether civil,  criminal,  administrative or investigative (other than an action
by, or in the right of, the  Company),  brought to impose a liability or penalty
on the Executive in his capacity of director, if applicable,  officer,  employee
or agent of the Company or of any other corporation or entity which he serves as
such at the request of the Company,  against judgments,  fines,  amounts paid in
settlement  and expenses,  including  attorneys'  fees  actually and  reasonably
incurred as a result of such action, suit or proceeding,  or any appeal thereof,
if he acted in good faith in the  reasonable  belief that such action was in the
best interests of this Company,  and in criminal actions or proceedings  without
reasonable  ground for belief that such action was unlawful.  The termination of
any such civil or criminal action,  suit or proceeding by judgment,  settlement,
conviction  or upon a plea of nolo  contendere  shall  not in  itself  create  a
presumption  that the  Executive  did not act in good  faith  in the  reasonable
belief that such action was in the best  interests of the Company or that he had
reasonable ground for belief that such action was unlawful. The foregoing rights
of indemnification shall apply to the heirs and personal  representatives of the
Executive  and  shall  not be  exclusive  of  other  rights  to  which he may be
entitled. The Company shall advance all costs and expenses of defense as well as
any amounts paid in settlement to any party.  The Executive  shall reimburse the
Company for any  amounts  advanced in his defense or paid on his behalf if it is
determined  by a final  judgment of a court of competent  jurisdiction  that the
Executive's  actions were  intentionally  contrary to the best  interests of the
Company or intentionally  unlawful. It is intended that the indemnity provisions
contained in this section shall permit the Company to indemnify the Executive to
the  fullest  extent  permitted  by  law.  This  indemnification  shall  survive
termination  of this  Agreement.  In no event  shall  Company's  indemnification
obligation to the Executive  hereunder be less than that provided by the Company
to members of the Company  Board and other  officers of the Company with respect
to  occurrences  while  Executive is or was a member of the Company  Board or an
officer of the Company.

       19.    ENTIRE AGREEMENT.  This Agreement  contains all the understandings
between the parties  hereto  pertaining to the matters  referred to herein,  and
supersedes  all  undertakings  and  agreements,  whether  oral  or  in  writing,
previously entered into by them with respect thereto (except this Agreement does
not  modify  the  terms of any  options  or  benefit  plans  referenced  in this
Agreement except as specifically set forth).  The Executive  represents that, in
executing this

                                       11
<PAGE>


Agreement,  he does not  rely and has not  relied  upon  any  representation  or
statement  not set forth  herein made by the Company  with regard to the subject
matter,  basis or effect of this Agreement or otherwise.  The Executive  further
agrees  and  represents  that  all  promises,  representations,  understandings,
arrangements and prior agreements,  including the Former Agreement,  between the
Executive and the Company are merged into, and are superseded by, this Agreement
(except this Agreement does not modify the terms of any options or benefit plans
referenced in this Agreement except as specifically set forth).

       20.    AMENDMENT OR MODIFICATION;  WAIVER. No provision of this Agreement
may be  amended  or  waived  unless  such  amendment  or  waiver is agreed to in
writing,  signed  by  the  Executive  and by a duly  authorized  officer  of the
Company.  No waiver by any party hereto of any breach by another party hereto of
any condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of a similar or  dissimilar  condition  or provision at
the same time, any prior time or any subsequent time.

       21.    NOTICES.  Any notice to be given hereunder shall be in writing and
shall be deemed given when delivered  personally,  sent by nationally recognized
courier service or registered or certified mail, postage prepaid, return receipt
requested, addressed to the party concerned at the address indicated below or to
such other  address as such party may  subsequently  give notice of hereunder in
writing:

              To Executive at:

              6745 Lenox Center Court
              Suite 300
              Memphis, TN  38115

              To the Company at:

              Varsity Brands, Inc.
              6745 Lenox Center Court
              Suite 300
              Memphis, TN  38115
              Attn:  Jeffrey G. Webb

Any notice  delivered  personally  or by courier  under this Section 21 shall be
deemed given on the date  delivered,  any notice sent by  nationally  recognized
courier service shall be deemed given on the second day after being given to the
courier  service and any notice sent by  registered or certified  mail,  postage
prepaid, return receipt requested,  shall be deemed given on the fifth day after
being given to the U.S. mail.

       22.    SEVERABILITY.  If  any  provision  of  this  Agreement  (including
without  limitation  Section 16) or the application of any such provision to any
party  or   circumstances   shall  be  determined  by  any  court  of  competent
jurisdiction  to be invalid and  unenforceable  to any extent,  the remainder of
this  Agreement  or  the  application  of  such  provision  to  such  person  or
circumstances  other than those to which it is so  determined  to be invalid and
unenforceable, shall

                                       12
<PAGE>


not be affected thereby,  and each provision hereof shall be validated and shall
be enforceable to the fullest extent permitted by law.

       23.    SURVIVORSHIP. The respective rights and obligations of the parties
hereunder  shall  survive  any  termination  of  this  Agreement  to the  extent
necessary to the intended preservation of such rights and obligations.

       24.    GOVERNING LAW; SPECIFIC PERFORMANCE; CERTAIN ACKNOWLEDGEMENTS.

              (a)    This  Agreement  will  be  governed  by  and  construed  in
accordance  with  the laws of the  State of  Tennessee,  without  regard  to its
conflicts of laws principles.

              (b)    The Executive acknowledges that the services to be rendered
by him are of a special  and  unique  character  which  gives this  Agreement  a
peculiar  value  to the  Company,  the loss of which  may not be  reasonably  or
adequately  compensated  for by damages in an action at law, and that a material
breach  or  threatened  breach  by him of any  of the  provisions  contained  in
Sections  15, 16 and 17 hereof will cause the Company  irreparable  injury.  The
Executive  therefore  agrees that the Company shall be entitled,  in addition to
any other right or remedy, to a temporary, preliminary and permanent injunction,
without the  necessity  of proving  the  inadequacy  of monetary  damages or the
posting of any bond or security, enjoining or restraining the Executive from any
such violation or threatened violations.

              (c)    The Executive  further  acknowledges and agrees that due to
the  uniqueness of his services and  confidential  nature of the  information he
will possess,  the covenants set forth in Sections 15, 16 and 17 are  reasonable
and necessary for the protection of the business and goodwill of the Company.

       25.    NO SET-OFF;  MITIGATION. The obligation of the Company to make the
payments  provided  in this  Agreement  and  otherwise  to perform  its or their
obligations  hereunder  shall  not be  affected  by any  set-off,  counterclaim,
defense,  or other  claim,  right or action  which the  Company  may have or may
allege to have against the Executive or others. The Executive shall have no duty
to  mitigate  the  amount of any  payment  provided  for in Section 12 herein by
seeking other  employment,  nor shall the amount of any payment  provided for in
this  Agreement be reduced by any  compensation  earned by the  Executive as the
result of employment by another  employer  after the date of  termination of the
Executive's employment with the Company, or otherwise.

       26.    ARBITRATION.  Any dispute arising under or in connection with this
Agreement shall be settled  exclusively by arbitration in Memphis,  Tennessee in
accordance  with  the  rules of the  American  Arbitration  Association  then in
effect.  Judgment may be entered on the  arbitrator's  award in any court having
jurisdiction.  All costs and  expenses of any such  arbitration  (including  all
legal  fees  and  expenses  incurred  by the  Executive)  shall  be borne by the
Company;  PROVIDED,  HOWEVER,  that the legal fees and expenses  incurred by the
Executive  shall  be  borne  by the  Executive  and not by the  Company  if such
arbitration results in a determination (a) in the case of a dispute with respect
to  termination of the  Executive's  employment by the Company for Cause or upon
Disability,  that a proper basis for such  termination did exist and appropriate
procedures


                                       13
<PAGE>


were followed by the Company, or (b) in the case of any other dispute,  that the
position taken by the Executive was incorrect.

       27.    LEGAL FEES.  Subject to Section 26 hereof,  the Company  shall pay
the  Executive  all  reasonable,  documented  legal  and  professional  fees and
expenses  incurred by the  Executive  in seeking to obtain or enforce any rights
provided  for under  this  Agreement,  provided  that the  Company  shall not be
required  to pay any such  legal  fees or  expenses  relating  to  obtaining  or
enforcing any rights if the Company  affords the Executive the rights under this
Agreement within ten days after notification from the Executive that the Company
is in breach  under this  Agreement.  Any such  notification  shall set forth in
reasonable detail the rights to which the Executive  believes he is entitled and
the provisions of this Agreement under which he believes afford such rights.

       28.    HEADINGS.  All descriptive  headings of sections and paragraphs in
this  Agreement are intended  solely for  convenience,  and no provision of this
Agreement  is to be  construed  by  reference  to the  heading of any section or
paragraph.

       29.    WITHHOLDINGS.  All payments to the Executive  under this Agreement
shall be reduced by all applicable  withholdings  required by Federal,  state or
local law.

       30.    COUNTERPARTS;   FACSIMILE.  This  Agreement  may  be  executed  in
counterparts,  each of  which  shall be  deemed  an  original,  but all of which
together shall constitute one and the same  instrument.  Executed copies of this
Agreement  sent by facsimile  shall have the same effect as originally  executed
copies of this Agreement.

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<PAGE>


       IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.

                                            VARSITY BRANDS, INC.


                                            By: /s/ JEFFREY G. WEBB
                                                --------------------------------
                                            Name:   Jeffrey G. Webb
                                            Title:  Chief Executive Officer



                                            /s/ JOHN NICHOLS
                                            ------------------------------------
                                            John M. Nichols


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