<SEQUENCE>4

<FILENAME>scvl2ndqtrqexhibit2.txt

<DESCRIPTION>EMPLOYMENT AND NONCOMPETITION AGREEMENT

<TEXT>

                     EMPLOYMENT AND NONCOMPETITION AGREEMENT



                  This EMPLOYMENT AND NONCOMPETITION AGREEMENT (the "Agreement")

is dated effective as of the 1st day of August, 2001, by and between SHOE

CARNIVAL, INC., an Indiana corporation with its principle offices located at

8233 Baumgart Road, Evansville, Indiana (the "Company"), and CLIFTON E. SIFFORD,

an individual residing at 3255 Brookfield Drive, Newburgh, Indiana (the

"Employee").



                                    RECITALS



                  WHEREAS, the Company is one of the leading retailers of family

shoes in the United States;



                  WHEREAS, the Company desires to retain the services of the

Employee upon the terms and conditions set forth herein; and



                  WHEREAS, the Employee desires to be so employed by the

Company, to be eligible for opportunities of advancement, potential compensation

increases and potential bonus payments for fiscal year 2001 and later, and to be

given access to confidential and proprietary information necessary to perform

his job, but which the Company would not make available to him but for his

signing and agreeing to abide by the terms of this Agreement as a condition of

his continuing employment with the Company; and



                  WHEREAS, the Company and the Employee desire to enter into

this Agreement to set forth the terms and conditions of the employment

relationship between the Company and the Employee; and



                  WHEREAS, in connection with its business, the Company has

expended a substantial amount of time, money, and effort to develop and maintain

its confidential, proprietary and trade secret information, and that this

information, if misused or disclosed, could be very harmful to Company's

business and its competitive position in the marketplace.



                                    AGREEMENT



                  1.       Term of Employment. The Company hereby agrees to

employ Employee and Employee hereby agrees to be employed by the Company, in

accordance with the terms and conditions herein, for a period commencing on the

effective date of this Agreement up to and through December 31, 2003, subject,

however, to earlier termination as expressly provided in this Agreement (such

term, including any extension thereof, shall herein be referred to as the

"Term"). This Agreement shall be renewed automatically for successive terms of

one (1)year each unless either party provides written notice of non-renewal to

the other party at least sixty (60) days before the end of the then current

Term.

<PAGE>



                  2.       Scope of Duties. The Employee shall continue

employment in his current position, Executive Vice President, General

Merchandise Manager.  During the Term, the Employee agrees to perform such other

services for the Company as may be directed by the Company. The Employee shall

be supportive of the Company's business and its best interests and shall not,

directly or indirectly, take any action which could reasonably be expected to

have an adverse effect upon the business or best interests of the Company. The

Employee covenants that he will at all times honestly and fairly conduct his

duties, and will at all times maintain the highest of professional standards in

representing the interests of the Company. The Employee will comply with Company

policies, decisions, and instructions, which may be changed by the Company over

time. Employee shall perform all duties incident to his newly promoted position,

as well as any other duties as may from time to time be assigned by the

President of the Company or his designee, and agrees to abide by all By-laws,

policies, practices, procedures or rules of the Company.



                  3.       Compensation of Employee.  For all services rendered

by the Employee under this Agreement, the Company shall compensate the Employee

as follows:



                           3.1      Base Salary. The Base Salary payable to the

         Employee under this Agreement shall be that amount set forth in the

         Company Payroll Action Form, effective August 1, 2001 ("Base Salary"),

         payable in accordance with the Company's usual payroll procedures, and

         subject to all taxes, withholdings and deductions as required by law

         and as the Employee may authorize. The Company will review the Base

         Salary on a periodic basis, approximately annually, during the Term to

         determine, in the discretion of the Company, whether the Base Salary

         should be adjusted, and if so, the amount of such adjustment and the

         time at which such adjustment should take effect.



                           3.2      Incentive Bonus. The Employee is entitled to

         participate in the Company's discretionary incentive bonus program in

         accordance with the terms contained in the then current Incentive Bonus

         Plan for his position, as may be amended or modified by the Company

         from time to time. However, Employee agrees that the failure of the

         Company to award any such bonus and/or other incentive compensation

         shall not give rise to any claim against the Company.



                  4.       Additional Compensation, Benefits, and Obligations.

During the Term, and so long as the Employee serves in the position of Executive

Vice President, Employee is entitled to participate in any and all employee

welfare and health benefit plans (including, but not limited to, life insurance,

health and medical, dental and disability plans, and Exec-U-Care) and other

employee benefit plans, including but not limited to, qualified pension plans,

stock purchase plans, and nonqualified deferred compensation plans, established

by the Company from time to time for the benefit of executives at his level and

position; provided, however, the Employee's participation in such plans is

subject to the eligibility requirements and other terms of such plans. The

Company may change, amend or discontinue any of its employee welfare and health

benefit plans at any time during the Term, and nothing in this Agreement shall

obligate the Company to institute, maintain or refrain from changing, amending

or discontinuing any such plans or programs.



                                       2

<PAGE>





                  5.       Termination of Employment. Employee's employment may

be terminated as follows:



                           5.1      For Cause. The Company may terminate

         Employee's employment at any time effective immediately for "Cause." As

         used in this Agreement, the term "Cause" means the occurrence of any

         one or more of the following events: (i) Employee's conviction for a

         felony or other crime involving moral turpitude; (ii) Employee's

         engaging in illegal conduct or gross misconduct which is injurious to

         the Company; (iii) Employee's engaging in any fraudulent or dishonest

         conduct in his dealings with, or on behalf of, the Company; (iv)

         Employee's failure or refusal to follow the lawful and reasonable

         instructions of the Company's Chief Executive Officer, President, or

         other executive officer to whom Employee reports, if such failure or

         refusal continues for a period of five (5) days after the Company

         delivers to Employee a written notice stating the instructions which

         Employee has failed or refused to follow; (v) Employee's material

         breach of any of his obligations under this Agreement; (vi) Employee's

         material breach of the Company's policies; (vii) Employee's use of

         alcohol or drugs which interferes with the performance of his duties

         for the Company or which compromises the integrity or reputation of the

         Company; or (viii) Employee's engaging in any conduct tending to bring

         the Company into public disgrace or disrepute.



                           5.2      Unilateral - The Company.  The Company may

         terminate Employee's employment at any time without Cause.



                           5.3      Unilateral - Employee. Employee may

         terminate his employment at any time with the Company by providing the

         Company with thirty (30) days' advance written notice of such

         termination. At the sole option of the Company, such termination will

         be considered effective on the date such notice is given.



                           5.4      For Good Reason - Employee. If Employee

         voluntarily terminates his employment during the Term, he shall notify

         Employer in writing if he believes the termination is for Good Reason.

         Employee shall set forth in reasonable detail why Employee believes

         there is Good Reason. For purposes of this Agreement, for "Good Reason"

         means the occurrence, without Employee's written consent, of any one or

         more of the following events: (a) a reduction in Employee's position or

         responsibilities; or (b) a reduction by the Company in Employee's Base

         Salary.



                           5.5      Disability. If Employee suffers a

         "Disability," the Company shall have the right to terminate Employee's

         employment by delivering to Employee a written notice of the Company's

         intent to terminate for Disability, specifying in such notice a

         termination date not less than ten (10) calendar days after the giving

         of the notice (the "Disability Notice Period"). The Employee's

         employment shall terminate at the close of business on the last day of

         the Disability Notice Period. For purpose of this Agreement, the term

         "Disability" shall mean either (a) when Employee is deemed disabled in

         accordance with the long-term disability insurance policy or plan of

         the Company in effect at the time of the illness or injury causing the

         Disability, or (b) the inability of Employee, because of injury,



                                       3

<PAGE>



         illness, disease or bodily or mental infirmity, to perform the

         essential functions of his job (with or without reasonable

         accommodation) for more than ninety (90) days during any period of

         twelve (12) consecutive months. The existence of a Disability shall be

         determined by the Company.



                                    Death.  If the Employee should die during

         the Term, the Company shall have no further obligation to the Employee,

         his spouse, or his estate except to pay to the Employee's estate the

         amount of compensation earned or accrued by the Employee through the

         month of his death, such compensation to be prorated to the date of

         death.



                           5.6      Compensation Upon Termination. In the event

         of termination of Employee's employment as set forth herein, and

         subject to the Company's right to offset against any such benefits,

         compensation, or severance amounts owed to Employee, whether the result

         of promissory notes, loans, or other financial arrangements the Company

         may have entered into on the Employee's behalf, and which are or would

         become due and payable on or after the Termination Date, to include the

         principle and interest pursuant to such arrangements, the Parties agree

         that the following terms shall be the exclusive severance arrangements:



                           5.6.1    In the event of termination of Employee's

                  employment by the Company for "Cause," pursuant to Section 5.1

                  or unilateral termination by the Employee pursuant to Section

                  5.3, the Company's obligation to pay and provide Employee

                  compensation and benefits under this Agreement shall

                  immediately terminate, except: (a) Employee shall be entitled

                  to receive that portion of his Base Salary which shall have

                  been earned through the termination date; and (b) the Company

                  shall pay or provide Employee such other payments and

                  benefits, if any, which had accrued hereunder before the

                  termination date. Other than the foregoing, the Company shall

                  have no further obligations to Employee under this Agreement.

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