NEWS RELEASE
CONTACT: Peter D. Brown
Vice President, Investor
Relations
and Treasurer
Foot Locker, Inc.
(212) 720-4254
NEW YORK, NY, June 4, 2004 –
Foot Locker, Inc. (NYSE: FL), the New York-based specialty athletic retailer,
today 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 percent of the holders of the notes of their election
to convert their securities into shares of the Company’s common stock.reported that
it had reached an Effective June 3, 2004, all of the convertible subordinated notes
have been cancelled and approximately 9.5 million new shares of Foot Locker,
Inc. 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.
Foot Locker, Inc. is a
specialty athletic retailer that operates approximately 3,900 athletic retail
stores in 17 countries in North America, Europe and Australia. Through its Foot Locker, Footaction, Lady
Foot Locker, Kids Foot Locker and Champs Sports retail stores, as well as its
direct-to-customer channel Footlocker.com/Eastbay, the Company is the leading
provider of athletic footwear and apparel.
This press release contains forward-looking statements, which reflect
management’s current views of future events and financial performance. These forward-looking statements are based
on many assumptions and factors detailed in the Company’s filings with the
Securities and Exchange Commission, including the effects of currency
fluctuations, customer demand, fashion trends, competitive market forces,
uncertainties related to the effect of competitive products and pricing,
customer acceptance of the Company’s merchandise mix and retail locations, the
Company’s reliance on a few key vendors for a majority of its merchandise
purchases (including a significant portion from one key vendor), unseasonable
weather, risks associated with foreign global sourcing, including political
instability, changes in import regulations, disruptions to transportation
services and distribution, and the presence of severe acute respiratory
syndrome, economic conditions worldwide, any changes in business, political and
economic conditions due to the threat of future terrorist activities in the
United States or in other parts of the world and related U.S. military action
overseas, the ability of the Company to execute its business plans effectively
with regard to each of its business units, including its plans for the marquee
and launch footwear component of its business, and its plans for the
integration of the Footaction stores.
Any changes in such assumptions or factors could produce significantly
different results. The Company
undertakes no obligation to update forward-looking statements, whether as a
result of new information, future events, or otherwise.