1995 Non-employee Director Stock Plan

Exhibit 10.2


CONVERSE INC.
1995 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
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(as amended and restated on July 30, 1997)


The purposes of the Converse Inc. 1995 Non-Employee Director Stock Option Plan (the "Plan") are to foster and promote the long term financial success of Converse Inc. (the "Company") by (a) attracting and retaining directors who are not employees and are not affiliated with the Company's largest stockholders, Lion Advisors, L.P. ("LALP") and Apollo Investment Fund, L.P. ("AIFLP") ("Non- Employee Directors") of outstanding ability by providing for the grant of nonqualified stock options; (b) providing Non-Employee Directors with compensation opportunities which are competitive with other corporations; and (c) enabling such directors to participate in such financial success of the Company by encouraging them to become owners of the common stock of the Company. The Company believes that the Plan will cause the participants to contribute materially to the growth of the Company, thereby benefitting the Company's stockholders and will align the economic interests of the participants with those of the stockholders.


1. Administration
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Administration of this Plan is intended to be self-executing in accordance with the express terms and conditions of the Plan. However, to the extent that determinations are required with respect to ministerial matters under the Plan, such determinations shall be made by a committee (the "Committee") consisting of not less than two persons appointed by the Board of Directors of the Company from among its members who are Non-Employee Directors of the Company, all of whom shall be "disinterested persons" as defined under Rule 16b-3 under the Securities Exchange Act of 1934 (the "Exchange Act"). In no event shall such determinations affect the eligibility of awards made or to be made under the Plan as "formula awards" within the meaning of Rule 16b-3(c)(2)(ii) under the Exchange Act, or any successor regulation. Subject to the foregoing, the Committee's interpretations of the Plan and all determinations made by the Committee pursuant to the powers vested in it hereunder shall be conclusive and binding.


2. Grants
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Incentives under the Plan shall consist of nonqualified stock options ("Grants"). All Grants shall be subject to the terms and conditions set forth herein and to those other terms and conditions consistent with this Plan as the Committee deems appropriate and as are specified in writing by the Committee to the employee (the "Grant Letter"). The Committee shall approve the form and provisions of each Grant Letter to each Non-Employee Director; provided, however, that Grants to Non-Employee Directors shall be made only in accordance with the provisions of Section 5.


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3. Shares Subject to the Plan
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(a) Subject to the adjustment specified below, the aggregate number of shares of common stock of the Company ("Company Stock") that have been or may be issued or transferred under the Plan is 45,000 shares. The shares may be authorized but unissued shares of Company Stock or reacquired shares of Company Stock, including shares repurchased by the Company on the open market. If and to the extent options granted under the Plan terminate, expire, or cancel without having been exercised, the shares subject to such option shall again be available for purposes of the Plan.


(b) If there is any change in the number or kind of shares of Company Stock issuable under the Plan through the declaration of stock dividends, or through a recapitalization, stock splits, or combinations or exchanges of such shares, or merger, reorganization or consolidation of the Company, reclassification or change in par value or by reason of any other extraordinary or unusual events affecting the outstanding Company Stock as a class without the Company's receipt of consideration, the maximum number of shares of Company Stock available for Grants, the maximum number of shares of Company Stock for which any one individual participating in the Plan may be granted over the term of the Plan, the number of shares of Company Stock for which automatic grants are to be subsequently made to Non-Employee Directors under Section 5 and the number of such shares covered by outstanding Grants, and the price per share or the applicable market value of such Grants, shall be proportionately adjusted by the Committee to reflect any increase or decrease in the number or kind of issued shares of Company Stock to preclude the enlargement or dilution of rights and benefits under such Grants; provided, however, that any fractional shares resulting from such adjustment shall be eliminated. The adjustments determined by the Committee shall be final, binding and conclusive.


4. Eligibility for Participation
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Only Non-Employee Directors shall be eligible to participate in the Plan (hereinafter referred to individually as the "Participant" and collectively as the "Participants").


5. Stock Option Grants to Non-Employee Directors
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(a) Number of Shares. Each director who is a Non-Employee Director (it being understood that individuals affiliated with LALP and AIFLP are not eligible to participate in the Plan) shall receive a grant of a nonqualified stock option to purchase 7,500 shares of Company Stock as of the effective date of this Plan as set forth in Section 14, subject to the approval of the Company's stockholders. Each individual who becomes a Non-Employee Director after the effective date of this Plan as set forth in Section 14 shall receive a grant of a nonqualified stock option to purchase 7,500 shares of Company Stock as of the date of his or her first election to the Board of Directors.


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(b) Option Price and Exercise Period. The purchase price of Company Stock subject to such grants shall be the fair market value of a share of such stock as of the date such Stock Option is granted. The "fair market value" of Company Stock shall be the closing price of a share of Company Stock on the New York Stock Exchange; provided, however, that if shares of Company Stock shall not be listed on the New York Stock Exchange, then the fair market value will be the closing price of a share of Company Stock on the principal stock exchange on which such shares are listed for trading, or if no sale takes place on such day on any such exchange, the average of the closing bid and asked prices on such day as officially quoted on any such stock exchange or if the Company Stock is not admitted to trading on any stock exchange the fair market price shall be the last sale reported on the NASDAQ National Market System published in the Wall Street Journal or, if no such sale is so reported, the average of the reported closing bid and asked prices on such day in the over-the-counter market, as furnished by the National Association of Security Dealers Automated System, or, if such price at the time is not available from such system, as furnished by any similar system then engaged in the business of reporting such prices and selected by the Company or, if there is no such system, as furnished by any member of the National Association of Security Dealers, selected by the Company. Each Stock Option granted pursuant to this Section ...