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Exhibit 10.2
 STOCK PLAN FOR NON-MANAGEMENT DIRECTORS
OF
PAYLESS SHOESOURCE, INC.




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2




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Administration
 Shares of Stock Available Under the Plan
  EXCHANGE RATIO TABLE
 Term of Grant
    
    5 year
    
    6 year
    
    7 yearOption Award
    
    
    .549
    
    
    
    .598
    
    
    
    .641
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. Eligibility.
  Awards.
  a.
    
    Option Award. An Option is a right or rights to
purchase a specific number of shares of Stock exercisable at such time or
times and subject to such terms and conditions, including vesting schedule, as
the Committee may determine and specify in the applicable Award Agreement.
Options shall be settled in cash or Stock.b.
    
    Stock Award.Stock Awards may be granted either
alone, in addition to, or in tandem with other Awards granted under the Plan.
Stock Awards are subject to such terms and conditions, including vesting
schedules, as the Committee may determine and specify in the applicable Award
Agreement. Stock Awards shall be settled in Stock.
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. General Terms and Conditions
 a.
    
    Term.The term of an Option Award shall not exceed seven years.b.
    
    Restrictions.Unless otherwise provided under the Plan or by the Committee,
during the Restricted Period, no Award shall be sold, exchanged, transferred,
assigned, pledged, hypothecated, or otherwise disposed of (other than upon the death
of the Participant, by beneficiary designation, by last will and testament or by the
laws of descent and distribution) and shall be exercisable and/or subject to receipt
during the Restricted Period only by the Participant. Each certificate evidencing shares of Stock granted pursuant to a Stock Award or shares of Stock received upon
exercise of an Option shall bear an appropriate legend referring to the terms,
conditions and restrictions applicable to such Award. Any attempt to dispose of such shares of Stock in contravention of such terms, conditions and restrictions shall be
ineffective. The Corporation itself will hold such shares in custody, until the
restrictions thereon shall have lapsed. The Corporation may delay the issuance of shares of Stock covered by any Award and the delivery of a certificate for such shares
of Stock until the shares of Stock to be issued in connection with the grant or
exercise of an Award, as applicable, are effectively registered under applicable
federal securities laws now in force or hereafter amended or until counsel for the
Corporation shall have given an opinion, which opinion shall not be unreasonably
conditioned or withheld, that such shares of Stock are exempt from registration under
applicable federal securities laws now in force or hereafter amended.c.
    
    Exercise Price.The exercise price of an Option Award shall not be less than
100% of the Fair Market Value of the Stock on the date such Option Award is granted
and the exercise opportunity may be capped if the Committee determines appropriate and
so specifies in the Award Agreement pertaining thereto.d.
    
    Repricing Prohibited.There shall be no grant of an Option Award to a
Participant in exchange for a Participants agreement to cancellation of a
higher-priced Option Award that was previously granted to such Participant.e.
    
    Payment of Taxes Related to Stock and Option Awards.The Corporation shall
have the right to require the payment (through withholding from any amount payable
from the Corporation to Participant) of any withholding taxes required by federal,
state or local law, if at all, in respect of an Award.
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f.
    
    Rights of Holders of Stock.A Participant shall have, after a certificate or
certificates for the number of shares of Stock granted have been issued in his or her
name, absolute ownership of such shares including the right to vote the same, subject,
however, to the terms, conditions and restrictions described in the Plan and in the
Award Agreement to such Participant. The Corporation will hold all certificates until
all restrictions on them have lapsed.g.
    
    Death, Disability & Termination.Any provision of Section 7(h) of Part I of
the Plan to the contrary notwithstanding, if a Participant who has been a member of
the Board continuously since the date as of which an Award was made and such
Participant shall cease to be such a member of the Board by reason of death or
Disability, then an Option Award granted to such Participant may be exercised to the
extent exercisable on the date of death or Disability, within the earlier of (x) 360
days after the death or Disability of such person and (y) the date on which the Option
expires by its terms, by the estate of such person, or by any person or persons who
acquired the right to exercise such Option Award by beneficiary designation, will or
by the laws of descent and distribution. Unless the Committee determines otherwise, a
Stock Award Agreement shall provide for the forfeiture of the non-vested shares of
Stock underlying such Stock Award upon the Participant ceasing to be a Participant for
any reason, including death or Disability.h.
    
    Terms of Award Agreement.After the Committee determines that it will offer
an Option Award or Stock Award, it will advise the Participant in writing or
electronically, by means of an Award Agreement, of the terms, conditions and
restrictions, including vesting, if any, related to the Award grant, including the
number of shares of Stock that the Participant shall be entitled to receive or
purchase, the price to be paid, if any, and, if applicable, the time within which the
Participant must accept the Award grant. The Award grant shall be accepted by
execution of an Award Agreement in the manner determined by the Committee. Unless the
Committee determines otherwise, the Award Agreement shall provide for the forfeiture
of the non-vested shares of Stock underlying such Stock Award and for any such shares
of Stock that remain non-vested at the time the Participant ceases to be a
Participant, the cessation of Participant status shall cause an immediate sale of such
non-vested shares of Stock to the Corporation at the original price per share of
Stock, if any, paid by the Participant.i.
    
    No Future Entitlements.No Participant shall have any claim or right to be
granted an Award under this Plan. Having received an Award under this Plan
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shall not give a Participant any right to receive any other Award under this Plan
and the Committee may determine that any or all Participant(s) are not eligible to
receive an Award under this Plan for an indefinite period or for a specified year
or years.
 j.
    
    Other.The Committee may establish such other terms and conditions for an
Award as it deems appropriate.
 II. MISCELLANEOUS
   Changes in Capital Structure
 Expenses of Plan.
 Amendment or Termination
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6
 7. Effective Date and Term.