Schedule 14A
Information Required in Proxy Statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Securities Exchange Act of 1934
(Amendment No.          )

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[     ] Preliminary Proxy Statement
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[     ] Definitive Additional Materials
[     ] Soliciting Material Pursuant to Section 240.14a-12

Foot Locker, Inc.

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NOTICE OF 20042005 ANNUAL MEETING

AND

PROXY STATEMENT

112 West 34th Street
New York, New York 10120

NOTICE OF 20042005 ANNUAL MEETING OF SHAREHOLDERS

GARY M. BAHLER Secretary

April 15, 20048, 2005

TABLE OF CONTENTS

General Information

      We are providing these proxy materials to you in connection with the solicitation of proxies by the Board of Directors of Foot Locker, Inc. for the 20042005 annual meeting of shareholders and for any adjournments or postponements of this meeting. We are holding this annual meeting on May 26, 200425, 2005 at 9:00 A.M. In this proxy statement we refer to Foot Locker, Inc. as “Foot Locker,” “the Company,” “we,” or “us.” We intend to mail this proxy statement and the proxy card to shareholders beginning on or about April 15, 2004.8, 2005.

      A copy of the Company's 20032004 Form 10-K was mailed to you along with this proxy statement. You may obtain without charge an additional copy by writing to our Investor Relations Department at Foot Locker, Inc., 112 West 34th Street, New York, New York 10120. It is also available free of charge through our corporate web site at www.footlocker-inc.com.www.footlocker-inc.com.

Admission to the Meeting

      Attendance at the meeting will be limited to shareholders as of the record date (or their authorized representatives) having an admission ticket or evidence of their share ownership, and guests of the Company. Seating at the meeting will be limited. If you plan to attend the meeting, please mark the appropriate box on your proxy card, and we will mail an admission ticket to you. You may also request an admission ticket if you are voting by telephone or via the Internet by responding to the appropriate prompts offered in those methods.

      If your shares are held in the name of a bank, broker, or other holder of record and you plan to attend the meeting, you can obtain an admission ticket in advance by providing proof of your ownership, such as a bank or brokerage account statement, to the Corporate Secretary at Foot Locker, Inc., 112 West 34th Street, New York, New York 10120. If you do not obtain an admission ticket, you must show proof of your ownership of the Company's Common Stock at the registration table at the door.

Outstanding Voting Stock and Record Date

      The only voting securities of Foot Locker are the shares of Common Stock. Only shareholders of record on the books of the Company at the close of business on April 2, 2004,1, 2005, which is the record date for this meeting, are entitled to vote at the annual meeting and any adjournments or postponements. Each share is entitled to one vote. There were 145,188,600156,521,613 shares of Common Stock outstanding on the record date. The enclosed proxy card shows the number of shares of Common Stock registered in the name of each shareholder of record on the record date.

Shares Held in the Foot Locker 401(k) PlanEmployee Plans

      If you hold shares of Foot Locker Common Stock through the Foot Locker 401(k) Plan or the Foot Locker Puerto Rico 1165(e) Plan, the enclosed proxy card also shows the number of shares allocated to your plan account. Your proxy card will serve as a voting instruction card for the trusteetrustees of the 401(k) Plan,plans, who will vote the shares. The trustee of the 401(k) Plantrustees will vote only those shares for which it has received voting instructions.instructions have been given. To allow sufficient time for voting by the 401(k) Plan trustee,trustees of these plans, your voting instructions must be received by May 21, 2004.20, 2005.

Vote Required

      Directors must be elected by a plurality of the votes cast. The affirmative vote of a majority of the votes cast at the meeting will be required to approve the ratification of the appointment of independent accountants.

Method of Counting Votes

      Votes will be counted and certified by independent inspectors of election. New York law and our By-laws require that a majority of the votes that shareholders are entitled to cast be present either in person or by proxy to constitute a quorum for the transaction of business. Under New York law, abstentions and broker non-votes are not counted in determining the votes cast for any proposal. Votes withheld for the election of one or more of the nominees for director will not be counted as votes cast for those individuals. Broker non-votes occur when brokers or other entities holding shares for an owner in street name do not receive voting instructions from the owner on non-routine matters and, consequently, have no discretion to vote on those matters. If a proposal is routine under the rules of the New York Stock Exchange, then the brokers or other entities may vote the shares held by them even though they have not received instructions from the owner.

      The Company's Certificate of Incorporation and By-laws do not contain any provisions on the effect of abstentions or broker non-votes.

Confidential Voting

      Our policy is that shareholders are to be provided privacy in voting. All proxy cards, voting instructions, ballots and voting tabulations identifying shareholders are held permanently confidential from the Company, except (i) as necessary to meet any applicable legal requirements, (ii) when disclosure is expressly requested by a shareholder or where a shareholder makes a written comment on a proxy card, (iii) in a contested proxy solicitation, or (iv) to allow independent inspectors of election to tabulate and certify the vote. The tabulators and inspectors of election are independent and are not employees of Foot Locker.

Method and Cost of Proxy Solicitation

      Proxies may be solicited, without additional compensation, by directors, officers or employees of the Company by mail, telephone, facsimile, telegram, in person or otherwise. We will bear the cost of the solicitation of proxies, including the preparation, printing and mailing of the proxy materials. In addition, we will request banks, brokers and other custodians, nominees and fiduciaries to deliver proxy material to the beneficial owners of the Company's Common Stock and obtain their voting instructions. The Company will reimburse those firms for their expenses in accordance with the rules of the Securities and Exchange Commission and the New York Stock Exchange. In addition, we have retained Innisfree M&A Incorporated to assist us in the solicitation of proxies for a fee of $10,000 plus out-of-pocket expenses.

How to Vote Your Shares

Vote by Telephone

      If you are located within the United States or Canada, you can vote your shares by telephone by calling the toll-free telephone number on your proxy card. Telephone voting is available 24 hours a day and will be accessible until 9:00 A.M. on May 26, 2004.25, 2005. The voice prompts allow you to vote your shares and confirm that your instructions have been properly recorded. Our telephone voting procedures are designed to authenticate shareholders by using individual control numbers. If you vote by telephone, you do NOT need to return your proxy card.If you are an owner in street name, please follow the instructions that accompany your proxy materials.

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Vote by Internet

      You can also choose to vote via the Internet. The web site for Internet voting is listed on your proxy card. Internet voting is available 24 hours a day and will be accessible until 9:00 A.M. on May 26, 2004.25,

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2005. As with telephone voting, you will be given the opportunity to confirm that your instructions have been properly recorded. If you vote via the Internet, you do NOT need to return your proxy card. If you are an owner in street name, please follow the instructions that accompany your proxy materials.

Vote by Mail

      If you choose to vote by mail, simply mark your proxy, date and sign it, and return it in the postage-paid envelope provided.

Voting at the Annual Meeting

      You may also vote by ballot at the annual meeting if you decide to attend in person. If your shares are held in the name of a bank, broker or other holder of record, you must obtain a proxy, executed in your favor, from the holder of record to be able to vote at the meeting.

      All shares that have been properly voted and not revoked will be voted at the annual meeting. If you sign and return your proxy card but do not give voting instructions, the shares represented by that proxy card will be voted as recommended by the Board of Directors.

Voting on Other Matters

      If any other matters are properly presented at the annual meeting for consideration, the persons named in the proxy will have the discretion to vote on those matters for you. At the date this proxy statement went to press, we did not know of any other matter to be raised at the annual meeting.

Revoking Your Proxy

      You may revoke your proxy at any time prior to its use by submitting to the Company a written revocation, submitting a duly executed proxy bearing a later date, or providing subsequent telephone or Internet voting instructions. In addition, any shareholder who attends the meeting in person may vote by ballot at the meeting, which would cancel any proxy previously given.

Householding Information

      Foot Locker has adopted a policy called “householding” for mailing the annual report and proxy statement which is intended to reduce printing costs and postage fees. The process of householding means that shareholders of record who share the same address and same last name will receive only one copy of our annual report and proxy statement unless we receive contrary instructions from any shareholder at that address. We will continue to mail a proxy card to each shareholder of record. Householding will not in any way affect the mailing of dividend checks.

      If you would prefer to receive multiple copies of the Company's proxy statement and annual report at the same address, we will send additional copies to you promptly upon request. If you are a shareholder of record, you may call our transfer agent, The Bank of New York, at 1-866-857-2216 or write to the Corporate Secretary at Foot Locker, Inc., 112 West 34th Street, New York, New York 10120. Eligible shareholders of record receiving multiple copies of the annual report and proxy statement can request householding by contacting us in the same manner.

      Shareholders who hold their shares in street name through a broker, bank or other nominee, may request additional copies of the annual report and proxy statement or may request householding by notifying their broker, bank or other nominee.

Electronic Access to the Proxy Statement and Annual Report

      Our proxy statement and annual report are located on our corporate web site at www.footlocker-inc.com.Many shareholders can access future proxy statements and annual reports on the Internet instead of receiving paper copies in the mail. If you are a shareholder of record, you may

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choose give your consent to access these materials in the future on the Internet by marking the appropriate box on your proxy card or bygoing to https://www.giveconsent.com/fl and following the instructions on that site or, if you vote by telephone or on the Internet.Internet, by following the instructions provided. If you choose to access future annual reports and proxy statements on the Internet, you will receive a proxy card in the mail next year with

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instructions containing the Internet address for those materials. Your choice will remain in effect until you advise us otherwise in writing.

Beneficial shareholders who hold their shares in street name through a broker, bank, or other nominee should refer to the information provided by their broker, bank or nominee for instructions on how to elect access to future annual reports and proxy statements on the Internet. Most beneficial shareholders who elect electronic access will receive an e-mail message next year containing the Internet address for access to the proxy statement and annual report.

BENEFICIAL OWNERSHIP OF THE COMPANY'S STOCK

Directors and Executive Officers

      The table below sets forth, as reported to the Company, the number of shares of Common Stock beneficially owned as of April 2, 2004,1, 2005, by each of the directors and the named executive officers. The table also shows the beneficial ownership of the Company's stock by all directors, the named executive officers and the executive officers as a group on that date, including shares of Common Stock that they have a right to acquire within 60 days after April 2, 20041, 2005 by the exercise of stock options.

      No director, named executive officer or executive officer beneficially owned one percent or more of the total number of outstanding shares of Common Stock as of April 2, 2004.1, 2005.

      Except as otherwise noted in a footnote below, each person has sole voting and investment power with respect to the number of shares shown.

Amount and Nature of Beneficial Ownership

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(c)		35,520 shares are held by a private Canadian company of which Mr. Crawford is the sole director and officer. Mr. Crawford and a family trust are the shareholders of the private company, with Mr. Crawford holding voting control.
(d)		Includes 150 shares held by spouse.
(e)		This figure represents approximately 2.182.37 percent of the shares of Common Stock outstanding at the close of business on April 2, 2004.1, 2005.

Persons Owning More Than Five Percent of the Company's Stock

      Following is information regarding shareholders who beneficially own more than five percent of the Company's Common Stock according to documents filed by those shareholders with the SEC. To the best of our knowledge, there are no other shareholders who beneficially own more than five percent of a class of the Company's voting securities.

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		Fidelity International Limited (Pembroke Hall, 42 Crowlane, Hamilton, Bermuda), an investment adviser, beneficially owned 567,601327,321 shares as of December 31, 20032004 and has the sole power to vote and dispose of suchthese shares.
(c)(b)		Reflects shares beneficially owned as of December 31, 2004, according to Amendment No. 12 to Schedule 13G filed with the SEC dated January 26, 2004.SEC. As reported in this schedule, Lord, Abbett & Co., LLC, an investment adviser, holds sole voting and dispositive power with respect to the 8,850,90411,007,105 shares.

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(d)(c)		Reflects shares beneficially owned as of December 31, 2004 by Merrill Lynch & Co., Inc. (on behalf of Merrill Lynch Investment Managers (“MLIM”)) according to aAmendment No. 1 to Schedule 13G filed with the SEC dated January 16, 2004.SEC. Merrill Lynch & Co., Inc. (on behalf of MLIM), an investment adviser, reported shared voting and dispositive power with respect to 8,448,8209,703,545 shares.
(d)		Reflects shares beneficially owned as of December 31, 2004, according to Amendment No. 2 to Schedule 13G filed with the SEC. As reported in this schedule, Wellington Management Company, LLP, an investment adviser, holds shared voting power with respect to 7,185,900 shares and shared dispositive power with respect to 9,440,600 shares.

Section 16(a) Beneficial Ownership Reporting Compliance

      Section 16(a) of the Securities Exchange Act of 1934 requires that the Company's directors and executive officers file with the SEC and theThe New York Stock Exchange reports of ownership and changes in ownership of Common Stock and other equity securities of the Company. These persons are required by SEC rules to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of the copies of those reports furnished to the Company or written representations that no other reports were required, the Company believes that during the 20032004 fiscal year, the directors and executive officers complied with all applicable SEC filing requirements.

CORPORATE GOVERNANCE

Corporate Governance Guidelines

      The Board of Directors has adopted Corporate Governance Guidelines, and a copy of the Guidelines is attached as Appendix A.Guidelines. The Board expects periodically to review and may, if appropriate, revise the Guidelines. The Corporate Governance Guidelines are available on the corporate governance section of the Company's corporate web site at www.footlocker-inc.com.A printed copy of the Guidelines may also be obtained upon request by writing to the Corporate Secretary located at the Company's headquarters.

Committee Charters

      The Board of Directors has adopted charters for the Audit Committee, the Compensation and Management Resources Committee, the Finance and Strategic Planning Committee, and the Nominating and Corporate Governance Committee, and the Retirement Plan Committee. Copies of the charters for these committees are available on the corporate governance section of the Company's corporate web site at www.footlocker-inc.com.Printed copies of these charters may also be obtained upon request by writing to the Corporate Secretary located at the Company's headquarters.

Director Independence

      The Board believes that a significant majority of the members of the Board should be independent, as determined by the Board in accordance with the criteria established by The New York Stock Exchange. The Nominating and Corporate Governance Committee will review, on an annual basis, any relationships between outside directors and the Company that may affect independence. Currently, only one of the 1112 members of the Board of Directors serves as an officer of the Company, and 910 of the 1112 directors are independent under the criteria established by theThe New York Stock Exchange.

Lead Director

      On February 1, 2004, Matthew D. Serra, the Company's President and Chief Executive Officer, became its Chairman of the Board, President and Chief Executive Officer. J. Carter Bacot who hadhas served as non-executive Chairman of the Board, was appointed lead director as ofsince February 1, 2004.

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Executive Sessions of Non-Management Directors

      The Board of Directors holds regularly scheduled executive sessions of non-management directors. J. Carter Bacot, as lead director, presides at executive sessions of the non-management directors. In addition, the Board is scheduled to holdholds an executive session of the independent directors in 2004, at which the Chair of the Nominating and Corporate Governance Committee will preside.presides.

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Board Members' Attendance at Annual Meetings

      Although the Company does not have a policy on Board members' attendance at annual shareholders' meetings, we encourage each director to attend these important meetings. The annual meeting is normally scheduled on the same day as a Board of Directors' meeting. In 2003, we rescheduled2004, 10 out of the annual meeting. As a result, seven11 directors who were then serving attended the 20032004 annual shareholders' meeting. The remaining four directors were unable to attend due to previously scheduled commitments that conflicted with the rescheduled meeting date.

New Director Orientation

      We have an orientation program for new directors, which is intended to educate the new director on the Company and the Board's practices. At the orientation, the newly elected director generally meets with the Company's Chief Executive Officer, the General Counsel and Secretary, the Chief Financial Officer, as well as with other senior financial officers of the Company, to review the business operations, financial matters, investor relations, corporate governance policies, and the composition of the Board and its committees. Additionally, he or she has the opportunity to visit our stores at the Company's New York headquarters, or elsewhere, with a senior division officer for an introduction to store operations.

Payment of Directors Fees in Stock

      The non-employee directors receive one-half of their annual retainer fees, including committee chair retainer fees, in shares of the Company's Common Stock, with the balance payable in cash. Directors may elect to receive up to 100 percent of their fees in stock.

Director Retirement

      The Board has established a policy that directors resign from the Board at the annual meeting of shareholders following the director's 72nd birthday. As part of the Nominating and Corporate Governance Committee's regular evaluation of the Company's directors and the overall needs of the Board, the Nominating and Corporate Governance Committee may ask a director to remain on the Board for an additional period of time beyond age 72, or to stand for re-election after reaching age 72. In no event, however, shall any director remain on the Board beyond the date of the annual meeting of shareholders following the director's 75th birthday.

      The Board has established a policy that any director who experiences a change in his or her principal employment position shall submit a letter of resignation to the Chair of the Nominating and Corporate Governance Committee. That committee shall promptly meet to consider such athe letter of resignation and shall either accept or reject the letter of resignation.it.

Communications with the Board of Directors

      The Board of Directors has established a procedure for shareholders to send communications to the Board of Directors. Shareholders desiring to communicate directly with the outside directors of the Company should send a letter to: Board of Directors, c/o Secretary, Foot Locker, Inc., 112 West 34th Street, New York, NY 10120. Upon receipt of any such communication, the Secretary shall promptly send a copy of the communication to the lead director and the Chair of the Nominating and Corporate Governance Committee. The lead director or the Chair of the Nominating and Corporate Governance Committee may direct the Secretary to send a copy of such communication to the other outside

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directors and may determine whether a meeting of the outside directors should be called to review such communication.

      A copy of the Procedures for Shareholder Communication with the Board of Directors is available on the Company's corporate web site at www.footlocker-inc.com.A printed copy may also be obtained upon request by writing to the Corporate Secretary at the Company's headquarters.

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Retention of Outside Advisors

      The Board of Directors and all of its committees have authority to retain the services of outside advisors and consultants that they consider necessary or appropriate in carrying out their respective responsibilities. The independent accountants are retained by the Audit Committee and report directly to the Audit Committee. In addition, the internal auditors are retainedselected by the Audit Committee and are ultimately accountable to the Audit Committee. Similarly, consultants retained by the Compensation and Management Resources Committee to assist it in the evaluation of senior executives' compensation report directly to that committee.

Code of Business Conduct

      The Company has adopted a Code of Business Conduct for directors, officers and employees, including our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer. A copy of the Code of Business Conduct is available on the corporate governance section of the Company's corporate web site at www.footlocker-inc.com.A printed copy of the Code of Business Conduct may also be obtained upon request by writing to the Corporate Secretary at the Company's headquarters.

Any waivers of the Code of Business Conduct for directors and executive officers must be approved by the Audit Committee. We intend to disclose promptly any waivers ofamendments to the Code of Business Conduct and waivers of the Code for directors and executive officers on the corporate governance section of the Company's corporate website at www.footlocker-inc.com.www.footlocker-inc.com.

BOARD OF DIRECTORS

Organization and Powers

      The Board of Directors has responsibility for establishing broad corporate policies, reviewing significant developments affecting Foot Locker, and monitoring the general performance of the Company. Our By-laws provide for a Board of Directors consisting of not less than 9 nor more than 17 directors, the exact number to be determined, from time to time, by resolution adopted by a majority of the entire Board. The size of the Board is currently fixed at 1112 directors.

      The Board held fivefour meetings during 2003,2004 and each director attended at least 75 percent of the aggregate total number of meetings of the Board and of meetings held by all committees of which he or she was a member.

Independence

      Pursuant to the rules of the New York Stock Exchange, the Board of Directors, upon the recommendation of the Nominating and Corporate Governance Committee, has determined that all membersthe following directors are independent because they have no material relationship to the Company other than their position as directors of the Company:

      In making its decision on independence, the Board of Directors are independent other than Matthew D. Serra and J. Carter Bacot. Mr. Serra is not independent because he is an executive officer of the Company. Mr. Bacot is not independent because, in his roleconsidered Purdy Crawford's position as non-executive Chairman of the Board from March 2001 to January 2004, he received direct compensation from the Company in excess of $100,000 per year.

      The Board of Directors also considered the independence of Purdy Crawford, who is counsel to the Toronto law firm of Osler, Hoskin & Harcourt LLP (“OH&H”), a firm that has provided legal services to the Company. Mr. Crawford has advised the Company that, while OH&H provides him with an office and administrative support, the firm provided him with no remuneration in 2003.2004. The Board has determined that Mr. Crawford is independent because he received no direct compensation from OH&H, he is not an employee, equity partner, or manager of OH&H, and he is not involved in the provision of services to the Company.

      The Board of Directors, upon the recommendation of the Nominating and Corporate Governance Committee has determined that Matthew D. Serra and J. Carter Bacot are not independent because

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Mr. Serra is an executive officer of the Company and Mr. Bacot received direct compensation from the Company in excess of $100,000 per year in his role as non-executive Chairman of the Board from March 2001 to January 2004.

      The Board of Directors has determined that all members of the Audit Committee, the Compensation and Management Resources Committee and the Nominating and Corporate Governance Committee are independent as defined under the listing standards of theThe New York Stock Exchange.

Committees of the Board of Directors

      The Board has delegated certain duties to committees, which assist the Board in carrying out its responsibilities. There are six standing committees of the Board. Each director serves on at least two committees.one committee. The committee memberships, the number of meetings held during 2003,2004, and the functions of the committees are described below.

* Committee Chair

      Audit Committee. The committee held ten11 meetings in 2003.2004.

      The Board of Directors and the committee have approved a written charter governing the committee, and acommittee. A copy of the current charter is attached as Appendix B. available on the corporate governance section of the Company's corporate web site at www.footlocker-inc.com. The report of the Audit Committee appears on Page 27.29. The Board of Directors has determined that the Company has at least one audit committee financial expert, as defined under the rules of the Securities Exchange Act of 1934 (the “Exchange Act”), serving on the Audit Committee. David Y. Schwartz has been designated as the audit committee financial expert. Mr. Schwartz is independent under the rules of theThe New York Stock Exchange and the Exchange Act.

      The committee assists the Board in fulfilling its oversight responsibilities in the following areas: (i) accounting policies and practices, (ii) the integrity of the Company's financial statements, (iii) compliance with legal and regulatory requirements, (iv) the qualifications, independence, and performance of the independent accountants, and (v) the qualifications and performance of the internal audit function. The committee appoints the independent accountants and the internal auditors and is responsible for approving the independent accountants' and internal auditors' compensation.

      The Audit Committee has established procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters.

      Finance and Strategic Planning Committee.The committee held threeten meetings in 2003.2004.

      The committee (i) reviews the overall strategic and financial plans of Foot Locker, including capital expenditure plans, (ii) considers proposed debt or equity issues of the Company, (iii) reviews acquisition and divestiture proposals, and (iv) reviews reports of the Retirement Plan Committee with regard to the asset allocation and investment performance of the pension funds of the Company.

      Compensation and Management Resources Committee. The committee held four meetings in 2003.2004. The committee's report appears on Page 20.21.

      The committee determines compensation for the Company's officers and some aspects of compensation for certain other executives of the Company and its operating divisions. The committee,

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or its sub-committee, also administers the Company's various compensation plans, including the incentive and deferred compensation plans, the equity-based compensation plans and the employees stock purchase plan. Members of the committee are not eligible to participate in any of these plans. The committee has the authority to retain an outside compensation consultant, reporting directly to the committee, to assist it in evaluating executive compensation and benefits matters. The committee also

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reviews and makes recommendations to the Board of Directors regarding executive development and succession, including for the position of Chief Executive Officer.

      Nominating and Corporate Governance Committee.Committee. The committee held three meetings in 2003.2004.

      The committee has responsibility for overseeing matters of corporate governance affecting Foot Locker, including developing and recommending criteria and policies relating to service and tenure of directors. The committee is responsible for collecting the names of potential nominees to the Board, reviewing the background and qualifications of potential candidates for Board membership, and making recommendations to the Board for the nomination and election of directors. The committee also reviews membership on the committees of the Board and makes recommendations with regard to committee members and chairs. In addition, the committee periodically reviews the form and amount of directors compensation.

      The Nominating and Corporate Governance Committee may, from time to time, establish criteria for candidates for Board membership. These criteria shall include area of expertise, diversity of experience, independence, commitment to representing the long-term interests of the Company's stakeholders, and other relevant factors, taking into consideration the needs of the Board and the Company and the mix of expertise and experience among current directors.

      The committee continuously maintains a working list of potential director nominees suggested by members of the committee, current and former members of the Board, and members of management. The committee also will consider nominees to the Board of Directors recommended by shareholders that comply with the provisions of the Company's By-Laws and relevant law, regulation, or stock exchange rules. The procedures for shareholders to follow to propose a potential director candidate are described on Page 28.30. From time to time the committee may retain the services of a third party search firm to identify potential director candidates. After a potential nominee is identified, the committee chair will review his or her biographical information and discuss with the other members of the committee whether to request additional information about the individual or to schedule a meeting with the potential candidate. The committee's screening process for director candidates is the same regardless of the source who identified the potential candidate. The committee's determination on whether to proceed with a formal evaluation of a potential candidate is based on the person's experience and qualifications, as well as the current composition of the Board and its anticipated future needs.

      Alan D. Feldman, who has been nominated to stand for election as a director at the 2005 annual meeting, was elected a director by the Board of Directors effective February 1, 2005. Mr. Feldman was recommended initially by Jarobin Gilbert Jr., Chair of the Nominating and Corporate Governance Committee.

Retirement Plan Committee.The committee held five meetings in 2003.2004.

      The committee has responsibility to supervise the investment of the assets of the Company's United States retirement plans and to appoint, review the performance of and, if appropriate, replace, the trustee of the Company's pension trust and the investment manager responsible for managing the funds of such trust. The committee also has certain administrative responsibilities with regard to the United States retirement plans of the Company.

      Executive Committee.The committee did not meet in 2003.2004.

      Except for certain matters reserved to the Board, the committee has all of the powers of the Board in the management of the business of the Company during intervals between Board meetings.

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Directors Compensation and Benefits

Fiscal 2004 Compensation of Non-employee Directors

 * Payment deferred under the Foot Locker 2002 Directors Stock Plan.
** Did not serve as a director during the 2004 fiscal year.

      Non-employee Directors. Since April 1, 2003, we have provided the following compensation to our non-employee directors. This compensation was established by theNon-employee directors receive an annual retainer fee, meeting fees for attendance at each Board of Directors, on the recommendation of the Nominating and Corporate Governance Committee.committee meeting, and a stock option grant. Committee chairs receive an additional retainer fee. No additional compensation is paid to any director who is also an employee of the Company for service on the Board.Board or any committee. The Board of Directors, on the recommendation of the Nominating and Corporate Governance Committee, approved increases in the annual retainer fee, committee chair retainer fee, and meeting fees, as described below, effective January 1, 2005. The amounts paid to each non-employee director for the 2004 fiscal year, including amounts deferred under the Foot Locker 2002 Directors Stock Plan, are reported in the table above. The cash retainer/committee chair retainer fees and meeting fees reported in this table include, where applicable, one month during the 2004 fiscal year paid at the increased rate of compensation.

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		The number of shares paid to the directors wasfor their annual retainer fee is determined by dividing the applicable retainer amount by the average price of a share of stock on the last business day preceding the July 1 payment date.
	•	Committee Chair Retainers.The annual retainer fee for the committee chairs was $5,000 prior to January 1, 2005. The committee chairs receive an additional annual retainer of $5,000chair retainers are paid in the same form as theirthe directors' annual retainers. Prior to April 1, 2003, the annual retainer fee for committee chairs was $3,000. No additional annual retainer wasfee is paid to the chair of the Executive Committee. Effective January 1, 2005, the chair of the Audit Committee receives an additional annual retainer of $10,000, and the chairs of each of the Compensation and Management Resources Committee, the Nominating and Corporate Governance Committee, the Finance and Strategic Planning Committee, and the Retirement Plan Committee receive an additional annual retainer of $7,500.
	•	Meeting Fees. Directors receive aThe meeting fee ofwas $1,000 for attendance at each Board and committee meeting held beginning April 1, 2003. No meeting fees were paidattended prior to this date.January 1, 2005. The meeting fee was increased to $1,500 effective January 1, 2005.
	•	Annual Stock Option Grant.Grants. Directors receive an annuala stock option grant which is made on the first business day of each fiscal year. Beginning with the 2005 fiscal year, directors who are initially elected to the Board after the first day of the fiscal year are granted a stock option effective on the date of the first Board meeting attended by the new director in the fiscal year of his or her election. The number of sharesoptions granted is calculated by dividing $50,000 by the average of the high and low prices of a share of the Company's Common Stock on the first business day of the fiscal year. The per-share exercise price of each stock option granted may not be less than the fair market value of a share of Common Stock on the date of grant. Options granted in 20032004 vest one year following the date of grant. Vested options may remain exercisable for one year following a director's termination of service as a director. However, under no circumstances may an option remain outstanding for more than ten years from its date of grant.

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		During 2003, the2004, each non-employee directorsdirector, other than Alan Feldman who did not serve as a director in 2004, received a stock option grant covering 4,8492,019 shares at an exercise price of $10.31$24.755 per share.
	•	Miscellaneous.Directors and their immediate families are eligible to receive discounts on purchases of merchandise from our stores, catalogs and Internet sites. The Company reimburses non-employee directors for their reasonable expenses in attending meetings of the Board and committees, including travel expenses to and from meetings.

      Deferral Election.Non-employee directors may elect under the Foot Locker 2002 Directors Stock Plan to receive all or a portion of the cash component of their annual retainer (including committee chair retainers) in the form of deferred stock units or to have such amounts placed in an interest account. Directors may also elect to receive all or part of the stock component of their annual retainers in the form of deferred stock units. The interest account is a hypothetical investment account bearing interest at the rate of 120 percent of the applicable federal long-term rate, compounded annually, and set as of the first day of each plan year. A stock unit is an accounting equivalent of one share of the Company's Common Stock.

      The number of deferred stock units to be granted equals the portion of the annual retainer being deferred into stock units divided by the fair market value of a share of Common Stock on the scheduled payment date of the deferred amount. The value of each deferred stock unit shall change in direct relationship to changes in the value of the Company's Common Stock as determined by a valuation. Dividend equivalents will be earned on deferred stock units.

      The distribution of amounts deferred will occur as soon as administratively feasible following a non-employee director's termination of service as a director. He or she will receive a cash lump sum distribution equal to any balance allocated to his or her interest account, as calculated on the valuation date, and a lump sum distribution in shares of Common Stock equal to the value of his or her deferred stock unit account, based on the fair market value on the valuation date. Alternatively, the director may elect to receive his or her distribution in up to three annual installments, with the annual installment amount frozen as of the first distribution date.

Non-executive Chairman of the BoardLead Director

      J. Carter Bacot has served as the non-executive Chairman of the Board until January 31, 2004. In 2003, we paid Mr. Bacot an additional annual cash retainer of $220,000 for his services in this capacity.

      Effectivelead director since February 1, 2004, Mr. Bacot was appointed lead director, and we will pay him an additional annual cash retainer of $50,000 for his services in this capacity. We also will continue to provide Mr. Bacot with an office and administrative support.

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Directors' Retirement Plan

      The Directors' Retirement Plan was frozen as of December 31, 1995. Consequently, only two of the current directors, who had completed at least five years of service as a director on the date the plan was frozen, are entitled to receive a retirement benefit under this plan. Under the Directors' Retirement Plan, an annual retirement benefit of $24,000 will be paid to a qualified director for the lesser of the number of years of his or her service as a director or 10 years. Payment of benefits under this plan generally begins on the later of the director's termination of service as a director or the attainment of age 65. Directors with less than five years of service at December 31, 1995 and directors who are elected after this date are not eligible to participate in the Directors' Retirement Plan.

Directors and Officers Indemnification and Insurance

      We have purchased directors and officers liability and corporation reimbursement insurance from a group of insurers comprising AceACE American Insurance Co., St. Paul Mercury Insurance, RLI Insurance Co., Axis SpecialtyAmerican Alternative Insurance Company, American Casualty Company of Reading, PA (CNA) and Allied World Assurance and Liberty Mutual.Company, Ltd. These policies insure the Company and all of the Company's wholly owned subsidiaries. They also insure all of the directors and officers of the Company and the covered subsidiaries. The policies were written for a term of 12 months, from September 12, 20032004 until September 12, 2004.2005. The total annual premium for these policies, including fees, is $2,304,480.$1,548,775. Directors and officers of the Company, as well as all other employees with fiduciary responsibilities under the Employee Retirement Income Security Act of 1974, as amended, are insured under policies issued by a group of insurers comprising FederalZurich American Insurance Co., St. Paul Mercury Insurance, American Casualty Company of Reading PA (CNA) and Traveler'sRLI Insurance Co., which have a total premium of $525,000$497,500 for the 12-month period ending September 12, 2004.2005.

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      The Company has entered into indemnification agreements with its directors and officers, as approved by shareholders at the 1987 annual meeting.

Transactions with Management and Others

      Foot Locker and its subsidiaries have had transactions in the normal course of business with various other corporations, including certain corporations whose directors or officers are also directors of the Company. The amounts involved in these transactions have not been material in relation to the businesses of the Company or its subsidiaries, and it is believed that these amounts have not been material in relation to the businesses of the other corporations. In addition, it is believed that these transactions have been on terms no less favorable to the Company than if they had been entered into with disinterested parties. It is anticipated that transactions with such other corporations will continue in the future. As noted on Page 8, Purdy Crawford is Counsel to the Canadian law firm of Osler, Hoskin & Harcourt LLP.LLP, which provides legal services to the Company.

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EXECUTIVE COMPENSATION

Summary Compensation Table

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