Foot Locker announced that The Bank of New York, as Conversion Agent for the Company's $150 million outstanding 5.5% convertible subordinated notes, has received notice from 100% of the note holders of their election to convert their securities into shares of the Company's common stock. Effective June 3, 2004, all of these notes have been cancelled and approximately 9.5 million new shares of Foot Locker common shares have been issued.

This conversion has no impact on fully diluted earnings per share as the equivalent number of common shares has already been included in the Company's fully diluted share count. The Company's annual interest expense will decrease by approximately $8 million as a result of this conversion.

On April 20, 2004 Foot Locker, Inc. provided notice to The Bank of New York, as Trustee under the indenture, with notification that it intended to redeem its entire $150 million outstanding 5.5% convertible subordinated notes, effective June 4, 2004. The redemption price on June 4, 2004 was equal to 103.1% of the principal amount of the notes.

As a result of this redemption notification, the Company expected that most holders would convert their notes into shares of Foot Locker, Inc. common stock, on or before June 3, 2004 at a conversion price of $15.806 per share. This expectation was based on Foot Locker, Inc.'s common stock continuing to trade at a price greater than $16.30 per share, equal to the conversion price of $15.806 multiplied by the redemption price of 103.1% of the principal amount of the notes.