Employment Security Agreement

EXHIBIT 10.15


FLORSHEIM GROUP INC.


EMPLOYMENT SECURITY AGREEMENT


This Employment Security Agreement (the "Agreement") is entered into as of this twenty-fifth (25th) day of October, 2000, by and between Florsheim Group Inc., a Delaware corporation (the "Employer"), and Thomas W. Joseph (the "Executive").


WITNESSETH


WHEREAS, the Executive is currently employed by the Employer as its Executive Vice President, President International Division, President Retail Division;


WHEREAS, the Employer desires to attract and retain well-qualified executives and key personnel and to provide the security of continuity of management to both itself and the Executive; and


WHEREAS, the Executive and the Employer desire to enter into this Agreement, which sets forth the terms of the security the Employer is providing the Executive with respect to his employment;


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NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, and other good and valuable consideration, the receipt of which is hereby acknowledged, the parties agree as follows:


1. DEFINITIONS. For purposes of this Agreement the following definitions
shall apply:


(a) "Aggregate Compensation" means the sum of the
Executive's (i) Base Pay, (ii) Bonus, and (iii)
economic value of the Medical Plans, Retirement Plans
and Welfare Plans.


(b) "Base Pay" means the Executive's annual base salary
rate.


(c) "Bonus" means you shall receive an annual bonus in
accordance with the Employer's bonus plan. The plan is
based upon the Executive's achievement of budget, such
budget objectives to be determined by the Employer's
compensation committee in its sole discretion exercised
in good faith, after consultation with management. If
the Executive is terminated for any reason other than
Cause or the Executive terminates his employment with
the Employer for Good Reason, his bonus will be
pro-rated for the fiscal year in which his employment
terminates to the extent the Executive achieves budget
for such year. Notwithstanding the foregoing, in the
event the Executive's employment is terminated for Good
Reason pursuant to Section 1(f)(3), he shall receive
(i) his bonus for


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the year 2000 to the extent the Executive achieves
budget for such year and (ii) an amount equal to the
aggregate bonus paid to the Executive for the years
1999 and 2000 divided by 2.


(d) "Effective Date" means the date of this Agreement as
set forth above.


(e) "Cause" means:


(1) The Board of Directors, in its reasonable
discretion, concludes that the Executive has
willfully failed to follow directions communicated
to him by either an officer of the Employer to
whom the Executive directly or indirectly reports
or the Board of Directors;


(2) The Executive willfully engages in conduct that is
materially injurious to the Employer, monetarily
or otherwise;


(3) The Executive is convicted of, pleads nolo
contendere to, pleads guilty to or confesses to an
act of fraud, misappropriation or embezzlement or
any felony;


(4) The Board of Directors, in its reasonable
discretion, determinates that the Executive is
either habitually drunk or using illegal
substances;


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(5) The Executive violates the Employer's sexual
harassment policy; or


(6) The Executive commits an act of gross neglect or
gross misconduct which the Board of Directors, in
its reasonable discretion, determines is deemed
to be good and sufficient Cause.


(f) "Good Reason" means:


(1) There is a material reduction in the Executive's
Aggregate Compensation from one fiscal year to the
next; or


(2) There is a material reduction in the Executive's
responsibilities; or


(3) There is a material reduction in the Executive's
retirement benefits as a result of the
implementation of a new Retirement Plan established
by the Employer on or prior to December 31, 2001,
and, within thirty (30) days of notification,
the Executive informs the Employer in writing
that he chooses not to participate in such plan.


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(g) "Medical Plan" means any health and major medical plan
currently or hereafter made available by the Employer
in which the Executive is eligible to participate.


(h) "Retirement Plans" means any qualified or supplemental
defined benefit retirement plan or defined contribution
retirement plan currently or hereinafter made available
by the Employer in which the Executive is eligible to
participate, or any private retirement arrangement
maintained by the Employer solely for the Executive.


(i) "Severance Period" means the period beginning on the
date the Executive's employment with the Employer
terminates under circumstances described in Section 3
and ending on the date that is either eighteen (18) or
twelve (12) months thereafter as specified in Section
6.


(j) "Welfare Plan" means any vision or dental plan,
disability plan, survivor income plan or life insurance
plan or other arrangement currently or hereafter made
available by the Employer in which the Executive is
eligible to participate.


(k) "Equity Interest" means prior to March 31, 2001, the
Executive shall purchase in the open market the lesser
of 37,500 shares of Common Stock of the Employer or
shares of Common Stock of the Employer having an


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aggregate purchase price (including commissions) of
$75,000. In addition, upon the execution of this
Agreement, the Executive shall receive options pursuant
to the Employer's 1994 Stock Option Plan to purchase an
additional 155,000 shares of the Employer's Common
Stock as follows:


(1) 78,000 shares at Market,


(2) 38,000 shares at an exercise price of
$5.00 per share, and


(3) 39,000 shares at an exercise price of
$7.50 per share.


For purposes hereof, "Market" shall mean the average
closing price of the Employer's Common Stock on the
five (5) trading days immediately prior to the
Effective Date. Each tranche of options set forth
above shall vest and become exercisable in accordance
with the Employer's Stock Option Plan as detailed
below:


Anniversary Date % of Each Tranche to Vest
---------------- -------------------------
First 25%
Second ...