Foot Locker (FL)

B. Restricted Stock Awards

We make restricted stock awards to our named executive officers in order to more closely align the interests of our named executive officers with those of our shareholders, to provide our executives with an opportunity to increase their equity ownership, and to ensure the retention of key executives.

In recent years, the Compensation Committee has made annual grants of restricted stock to the Company’s Chief Executive Officer. In 2008, the Committee also made restricted stock awards to four of the other named executive officers. In making these grants, the Committee considers an executive’s past performance, an executive’s expected ability to contribute to the Company’s performance in the future, retention, and the desire to provide equity-based compensation through both stock options and restricted stock. When making restricted stock awards for retention purposes, the Compensation Committee considers an executive’s prior awards and their vesting schedule. The restrictions on restricted stock normally lapse a specified period following the grant date (normally three years). The holders of restricted stock receive dividends on their restricted shares at the time the dividends are paid.

B. Restricted Stock Awards

We make restricted stock awards to our named executive officers in order to strengthen the tie between an officer’s compensation opportunity and the shareholders’ interest in increasing the value of our common stock, to provide our executives with an opportunity to increase their equity ownership, and to ensure the retention of key executives.

In recent years, the Compensation Committee has made annual grants of restricted stock to the Company’s three most-senior executives—the Chief Executive Officer, the President-U.S.A., and the President-International. With regard to other executives, including the other named executive officers, it has made grants from time to time to individually selected executives in order to recognize outstanding past performance, to recognize an executive’s expected ability to contribute to the Company’s performance in the future, or for retention. When making restricted stock awards for retention purposes, the Compensation Committee considers an executive’s prior awards and their vesting schedule. The restrictions on restricted stock normally lapse a specified period following the grant date (normally three years). The holders of restricted stock receive dividends on their restricted shares at the time the dividends are paid.

In 2007, after reviewing the vesting schedule of prior awards held by the named executive officers, the Subcommittee made grants of restricted stock to all of the named executive officers.

B. Restricted Stock Awards

We make restricted stock awards to our named executive officers in order to strengthen the tie between an officer’s compensation opportunity and the shareholders’ interest in increasing the value of our common stock, to provide our executives with an opportunity to increase their equity ownership, and to ensure the retention of key executives.

Restricted stock awards are made by the Stock Option Plan Subcommittee. In general, other than with regard to Mr. Serra and Mr. Mina, the Subcommittee has not made annual grants of restricted stock; rather, it has made grants from time to time to individually selected executives in order to recognize outstanding past performance, to recognize an executive’s expected ability to contribute to the Company’s performance in the future, or for retention. When making restricted stock awards for retention purposes, the Subcommittee considers an executive’s prior awards and their vesting schedule.