EX-10.2



 






EXHIBIT 10.2




NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN

NONQUALIFIED STOCK OPTION AGREEMENT




     This Agreement (the “Agreement”) is made as of ___, 2___(the “Date of
Grant”) by and between NS Group, Inc., a Kentucky corporation (the “Company”)
and ___(the “Non-Employee Director”).



     1. Grant of Option Right. Subject to and upon the terms, conditions and
restrictions set forth in this Agreement and in the NS Group, Inc. Non-Employee
Director Equity Plan (the “Plan”), the Company hereby grants to the
Non-Employee Director as of the Date of Grant an option (the “Option Right”) to
purchase 4,000 Common Shares, at the price of ___per share (the “Option
Price”). This Option Right is intended to be a nonqualified stock option and
shall not be treated as an “incentive stock option” within the meaning of that
term under Section 422 of the Code.



     2. Exercise of Option Right.



        (a) Unless and until terminated as hereinafter provided, the Option Right
will become exercisable to the extent of one-third of the Common Shares
specified in Section 1 on each of the first three anniversaries of the Date of
Grant for so long as the Non-Employee Director continuously serves on the
Board.



        (b) Notwithstanding the provisions of Section 2(a), the Option Right will
become immediately exercisable in full if, prior to the date the Option Right
becomes fully exercisable pursuant to Section 2(a), and while the Non-Employee
Director serves on the Board, (i) the Non-Employee Director dies, or (ii) a
Change in Control occurs.



        (c) To the extent that the Option Right becomes exercisable in accordance
with this Section 2, it may be exercised in whole or in part from time to time
by written notice to the Company stating the number of Common Shares for which
the Option Right is being exercised and the intended manner of payment.



     3. Forfeiture of Option Right. The Option Right shall be forfeited (to
the extent it has not become exercisable pursuant to Section 2) if the
Non-Employee Director ceases to continuously serve on the Board.



     4. Payment of Option Price. The Option Price is payable (a) in cash or by
certified or cashier’s check or other cash equivalent acceptable to the Company
payable to the order of the Company, (b) with the Board’s approval, by
surrender of Common Shares (including by attestation) owned by the Non-Employee
Director, or (c) by a combination of surrender of Common Shares, and cash or
certified or cashier’s check.



     5. Term of Option Right. The Option Right will terminate on the earliest
of the following dates:



        (a) Two years after the Non-Employee Director ceases to serve on the Board
as a result of his death or Retirement;



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EXHIBIT 10.2




NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN

NONQUALIFIED STOCK OPTION AGREEMENT




        (b) Ninety days after the Non-Employee Director ceases to serve on the
Board for any reason other than as described in Section 5(a); or



        (c) Ten years from the Date of Grant.



        Notwithstanding anything contained in this Section 5 to the contrary, in
the event of a Change in Control, the Option Right will terminate on the
earliest of the following dates: (i) five years after the Change in Control or
(ii) ten years from the Date of Grant.



     6. Issuance of Common Shares. Subject to the terms and conditions of this
Agreement, Common Shares shall be issuable to the Non-Employee Director as soon
as administratively practicable following the date the Non-Employee Director
exercises the Option Right in accordance with Section 2 hereof and makes full
payment to the Company of the Option Price. The Non-Employee Director shall
not possess any incidents of ownership (including, without limitation, dividend
and voting rights) in the Common Shares until such Common Shares have been
issued to the Non-Employee Director in accordance with this Section 6.



     7. Transferability. Except with the consent of the Board, the Option
Right may not be sold, exchanged, assigned, transferred, pledged, encumbered or
otherwise disposed of by the Non-Employee Director; provided, however, that the
Non-Employee Director’s rights with respect to such Option Right may be
transferred by will or pursuant to the laws of descent and distribution. Any
purported transfer or encumbrance in violation of the provisions of this
Section 7 shall be void, and the other party to any such purported transaction
shall not obtain any rights to or interest in such Option Right. The Option
Right may be exercised, during the lifetime of the Non-Employee Director, only
by the Non-Employee Director, or in the event of his legal incapacity, by his
guardian or legal representative acting on behalf of the Non-Employee Director
in a fiduciary capacity under state law and court supervision. Common Shares
acquired upon the exercise of the Option Right may not be transferred for six
months, except in the case of the Non-Employee Director’s death, disability or
other termination of service.



     8. No Service Contract. Nothing contained in this Agreement shall confer
upon the Non-Employee Director any right with respect to continuance of service
on the Board, nor limit or affect in any manner the right of the Company or its
stockholders to terminate the service or adjust the compensation of the
Non-Employee Director.



     9. Taxes and Withholding. To the extent that the Company shall be
required to withhold any federal, state, local or other taxes in connection
with Common Shares obtained upon the exercise of the Option Right, it shall be
a condition to the issuance of such Common Shares that the Non-Employee
Director shall pay such taxes or make provisions that are satisfactory to the
Company for the payment thereof. The Non-Employee Director may elect to
satisfy all or any part of any such withholding obligation by surrendering
to the Company a portion of the Common Shares that are issued or transferred to
the Non-Employee Director upon the exercise of the Option Right, and the Common
Shares so surrendered by the Non-Employee Director shall be credited against
any such withholding obligation at the Market Value per Share of such shares on
the date of such surrender.



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EXHIBIT 10.2




NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN




NONQUALIFIED STOCK OPTION AGREEMENT




     10. Compliance with Law. The Company shall make reasonable efforts to
comply with all applicable federal and state securities laws and listing
requirements of the New York Stock Exchange or any national securities
exchange; provided, however, notwithstanding any other provision of this
Agreement, the Company will not be obligated to issue any Common Shares
pursuant to this Agreement if the issuance thereof would result in a violation
of any such law or listing requirement.



     11. Adjustments. The Board may make or provide for such adjustments in
the Option Price and in the number and kind of shares of stock covered by this
Agreement, as the Board, in its sole discretion, exercised in good faith, may
determine is equitably required to prevent dilution or enlargement of the
Non-Employee Director’s rights that otherwise would result from (a) any stock
dividend, stock split, combination of shares, recapitalization, or other change
in the capital structure of the Company, (b) any merger, consolidation,
spin-off, split-off, spin-out, split-up, reorganization, partial or complete
liquidation, or other distribution of assets (including, without limitation, a
special or large non-recurring dividend) or issuance of rights or warrants to
purchase securities, or (c) any other corporate transaction or event having an
effect similar to any of the foregoing. In the event of any such transaction
or event, the Board, in its discretion, may provide in substitution for the
Common Shares such alternative consideration as it may determine to be
equitable in the circumstances and may require in connection therewith the
surrender of the Common Shares.



     12. Availability of Common Shares. The Company shall at all times until
the expiration or forfeiture of the Option Right reserve and keep available,
either in its treasury or out of its authorized but unissued Common Shares, the
full number of Common Shares deliverable upon the exercise of the Option Right
awarded under this Agreement.



     13. Amendments. Subject to the terms of the Plan, the Board may modify
this Agreement upon written notice to the Non-Employee Director. Any amendment
to the Plan shall be deemed to be an amendment to this Agreement to the extent
that the amendment is applicable hereto. Notwithstanding the foregoing, no
amendment of the Plan or this Agreement shall adversely affect the rights of
the Non-Employee Director under this Agreement without the Non-Employee
Director’s consent.



     14. Severability. In the event that one or more of the provisions of this
Agreement shall be invalidated for any reason by a court of competent
jurisdiction, any provision so
invalidated shall be deemed to be separable from the other provisions
hereof, and the remaining provisions hereof shall continue to be valid and
fully enforceable.



     15. Relation to Plan. The Option Right granted under this Agreement and
all the terms and conditions hereof are subject to the terms and conditions of
the Plan. This Agreement and the Plan contain the entire agreement and
understanding of the parties with respect to the subject matter contained in
this Agreement, and supersede all prior written or oral communications,
representations and negotiations in respect thereto. In the event of any
inconsistency between the provisions of this Agreement and the Plan, the Plan
shall govern. Capitalized terms used herein without definition shall have the
meanings assigned to them in the



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EXHIBIT 10.2




NS GROUP, INC. NON-EMPLOYEE DIRECTOR EQUITY PLAN

NONQUALIFIED STOCK OPTION AGREEMENT



Plan. The Board acting pursuant to the Plan, as constituted from time to time,
shall, except as expressly provided otherwise herein, have the right to
determine any questions which arise in connection with the grant or exercise of
the Option Right.




     16. Successors and Assigns. Without limiting Section 7 hereof, the
provisions of this Agreement shall inure to the benefit of, and be binding
upon, the successors, administrators, heirs, legal representatives and assigns
of the Non-Employee Director, and the successors and assigns of the Company.



     17. Governing Law. The interpretation, performance, and enforcement of
this Agreement shall be governed by the laws of the Commonwealth of Kentucky,
without giving effect to the principles of conflict of laws thereof.



     18. Notices. Any notice to the Company provided for herein shall be in
writing to the Company and any notice to the Non-Employee Director shall be
addressed to the Non-Employee Director at his or her address on file with the
Company. Except as otherwise provided herein, any written notice shall be
deemed to be duly given if and when delivered personally or deposited in the
United States mail, first class certified or registered mail, postage and fees
prepaid, return receipt requested, and addressed as aforesaid. Any party may
change the address to which notices are to be given hereunder by written notice
to the other party as herein specified (provided that for this purpose any
mailed notice shall be deemed given on the third business day following deposit
of the same in the United States mail).



     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
on its behalf by its duly authorized officer and the Non-Employee Director has
also executed this Agreement in duplicate, as of the day and year first above
written.



	 	 	 
	

	 	NS GROUP, INC.
	

	 	 
	

	 	By:___________________
	

	 	Name:
	

	 	Title:







     The undersigned hereby acknowledges receipt of an executed original of
this Agreement and accepts the award of the Option Right granted thereunder on
the terms and conditions set forth herein and in the Plan.



	 	 	 
	

	 	______________________
	

	 	Non-Employee Director
	

	 	 
	

	 	Date: __________________







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