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                                                                    EXHIBIT 10.2

                              EMPLOYMENT AGREEMENT


         THIS AGREEMENT made February 12, 2001, between VENATOR GROUP, INC., a
New York corporation with its principal office at 112 West 34 Street, New York,
New York 10120 (the "Company") and Matthew D. Serra (the "Executive").

         WHEREAS, the Executive presently serves as the President and Chief
Operating Officer of the Company, pursuant to the provisions of the Employment
Agreement between the Company and the Executive dated September 8, 1998, as
amended by the Amending Agreement dated February 9, 2000 (the "1998 Agreement");
and

         WHEREAS, the Company desires to employ Executive as its President and
Chief Executive Officer, effective March 4, 2001, and Executive is willing to
serve in such capacity; and WHEREAS, the Company and Executive desire to set
forth the terms and conditions of such employment;

         NOW, THEREFORE, in consideration of these premises and of the mutual
covenants and agreements herein contained, the Company and Executive hereby
agree as follows:


1.       Employment and Term. The Company hereby agrees to employ Executive, and
         Executive hereby agrees to serve, as its President and Chief Executive
         Officer, subject to the terms and conditions set forth herein. The
         initial term of this agreement shall commence on March 4, 2001 (the
         "Commencement Date") and shall end on January 31, 2004, unless further
         extended or sooner terminated as hereinafter provided. Unless the
         Company notifies the Executive or the Executive notifies the Company on
         or before January 31, 2003, with regard to the initial term, and any
         January 31 of any

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         year thereafter, with regard to renewal terms, that the term shall not
         be extended, then as of such date, the term of the agreement shall be
         automatically extended for an additional year. The initial term of the
         agreement together with any renewal terms are hereinafter referred to
         as the "Employment Period".

2.       Position and Duties. Executive shall serve as the President and Chief
         Executive Officer of the Company, reporting only to the Board of
         Directors (the "Board"). Executive shall have such responsibilities,
         duties and authority as are commensurate with his status as President
         and Chief Executive Officer as may from time to time be determined or
         directed by the Board. Executive shall devote substantially all of his
         working time and efforts to the business and affairs of the Company and
         its respective subsidiaries and affiliates; provided, however, that the
         Executive may serve on the boards of directors of other for-profit
         corporations, if such service does not conflict with his duties
         hereunder or his fiduciary duty to the Company. It is further
         understood and agreed that nothing herein shall prevent the Executive
         from managing his passive personal investments (subject to applicable
         Company policies on permissible investments), and (subject to
         applicable Company policies) participating in charitable and civic
         endeavors, so long as such activities do not interfere in more than a
         de minimis manner with the Executive's performance of his duties
         hereunder.

3.       Place of Performance. In connection with his employment by the Company,
         Executive shall be based at the principal executive offices of the
         Company in the New York metropolitan area, or such other place in the
         United States to which the Company may hereafter relocate its principal
         executive offices. In the event of such relocation outside of the New
         York metropolitan area, the Company will pay the reasonable costs of
         the relocation of the principal residence of Executive, and provide
         such other relocation assistance as the Company then provides to its
         comparably situated senior executives employees.

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4.       Compensation. As full compensation for the services of Executive
         hereunder, and subject to all of the provisions hereof:

(a)      During the Employment Period, the Company shall pay Executive a base
         salary at such rate per year as may be fixed by the Compensation
         Committee of the Board of Directors from time to time, but in no event
         at a rate of less than $1,200,000 per year, to be paid in substantially
         equal monthly installments, in accordance with the normal payroll
         practices of the Company (the "Base Salary").

(b)      During the Employment Period, Executive shall be entitled to
         participate in all bonus, incentive, and equity plans that are
         maintained by the Company from time to time during the Employment
         Period for its comparably situated senior executive employees in
         accordance with the terms of such plans at the time of participation.
         The Company may, during the Employment Period, amend or terminate any
         such plan, to the extent permitted by the respective plan, if such
         termination or amendment occurs pursuant to a program applicable to all
         comparably situated executives of the Company and does not result in a
         proportionally greater reduction in the rights or benefits of Executive
         as compared with any other comparably situated executives of the
         Company. During each year of the Employment Period, the annual bonus
         payable to Executive at target shall be 75 percent of Executive's
         then-current Base Salary. The bonus payable to Executive at target
         under the Long-Term Incentive Compensation Plan for any three-year
         performance period shall be 90 percent of Executive's Base Salary at
         the beginning of such performance period.

(c)      During the Employment Period, Executive shall be eligible to
         participate in all pension, welfare, and fringe benefit plans, as well
         as perquisites, maintained by the Company from time to time for its
         comparably situated senior executive employees in accordance with their
         respective terms as in effect from time to time. These shall

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         include (i) Company-paid life insurance in the amount of Executive's
         annual Base Salary, (ii) long-term disability insurance coverage of
         $25,000 per month; (iii) annual out-of-pocket medical expense
         reimbursement of up to $5,000 per year; (iv) reimbursement of financial
         planning expense of up to $5,000 per year; (v) participation in the
         Supplemental Executive Retirement Plan (prorated for any partial plan
         year included in the Employment Period); and (vi) eligibility to
         participate in the Deferred Compensation Plan. The Company acknowledges
         that upon the commencement of his employment with the Company Executive
         was treated as if he had been credited with five years of service under
         the provisions of the Venator Group Retirement Plan, and Executive
         acknowledges that any increased amount of pension payable to him as a
         result of such credit may be payable from the Venator Group Excess Cash
         Balance Plan or a similar non-qualified plan of the Company.

(d)      During the Employment Period, Executive shall be entitled to receive
         reimbursement for all reasonable and customary expenses incurred by him
         in performing services hereunder, including all travel and living
         expenses while away from home on business at the request of the
         Company, provided such expenses are incurred and accounted for in
         accordance with the Company's applicable policies and procedures.

(e)      Executive shall be entitled to 20 vacation days in each calendar year.
         Unused vacation shall be forfeited.

(f)      On the date hereof, Executive shall be granted stock options under, and
         pursuant to the provisions of, the 1995 Stock Option and Award Plan or
         the 1998 Stock Option and Award Plan (the applicable plan being
         hereinafter referred to as the "Option Plan") to purchase 500,000
         shares of Common Stock of the Company at fair market value on the date
         of grant, as defined in the Option Plan. Such stock options shall vest
         in three equal installments on February 12, 2002, February 12, 2003,
         and January 31, 2004, and shall be subject to the provisions of the
         Option Plan and the

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         Stock Option Award Certificate. Executive shall not be eligible to
         receive additional stock option grants during the Employment Period. To
         the extent permissible under the terms of the Option Plan, all options
         shall become immediately exercisable upon any Change in Control.

(g)      Within 30 days of the Commencement Date, Executive shall be granted
         150,000 shares of restricted stock (the "Restricted Stock") under, and
         pursuant to the provisions of, the Option Plan and the terms of a
         restricted stock agreement essentially in the form of Attachment B
         hereto.

(h)      The Company shall reimburse Executive the reasonable legal fees (based
         on hourly rates) and disbursements incurred by him in connection with
         negotiating and preparing this employment agreement, provided that in
         no event shall the amount of such reimbursement exceed $15,000.

(i)      The Company shall reimburse Executive the costs associated with an
         automobile of a type to be reasonably agreed upon by the Company and
         Executive, such costs to include monthly lease payments, garaging,
         insurance, fuel, and maintenance; provided, however, that the total
         amount of such payments shall not exceed $30,000 per year.

         5.  Termination.

         (a)      The Employment Period shall terminate upon the earliest of the
                  following:

                  (i)  the death of Executive;

                  (ii) if, as a result of the incapacity of Executive due to
                  physical or mental illness, Executive shall have been absent
                  from his duties hereunder on a full time

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                  basis for 180 days, and within 30 days after written notice of
                  termination is given (which may occur before or after the end
                  of such 180 day period) he shall not have returned to the
                  performance of his duties hereunder on a full time basis; or

                  (iii) if the Company terminates the employment of Executive
                  hereunder for Cause. For purposes of this agreement, the
                  Company shall have "Cause" to terminate the employment of
                  Executive hereunder upon (A) his willful and continued failure
                  to substantially perform his duties hereunder (other than any
                  such failure resulting from his incapacity due to physical or
                  mental illness) (B) his willful engagement in misconduct that
                  is materially injurious to the Company, monetarily or
                  otherwise or (C) his failure to commence the performance of
                  his duties hereunder on the Commencement Date.

         (b)      If the Company shall terminate the employment of Executive
                  pursuant to the provisions of paragraph (a) above, it shall
                  have no further liability or obligation hereunder except (i)
                  to pay promptly to Executive his then-current Base Salary
                  through the effective date of such termination, and (ii)
                  Executive shall receive benefits, if any, and have the rights
                  afforded by the Company, under its then-existing policies, to
                  employees whose employment is terminated for death,
                  disability, or cause, as the case may be, or under the
                  specific terms of any welfare, fringe benefit, or incentive
                  plan.

         (c)      (i) If the employment of Executive is terminated for any other
                  reason during the Employment Period, or if the Company
                  breaches any material provision of this agreement, which
                  breach is not corrected within 30 days following written
                  notice to the Company, the Restricted Stock shall become fully
                  vested as of the date of the termination of Executive's
                  employment and the Company shall make the following payments
                  and provide the following benefits to Executive: Until the
                  earliest of (i) the end of the Employment Period (ii) his
                  death, or (iii) his breach of

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                  the provisions of Section 8 hereof, (A) the Company shall make
                  payments to Executive, no less frequently than monthly,
                  calculated at his then-applicable annual rate of Base Salary;
                  (B) the Company shall pay to Executive (at the same time as
                  other annual bonuses are paid), with respect to the fiscal
                  year in which such termination occurs, the annual bonus that
                  Executive would otherwise have earned under the annual bonus
                  plan applicable to Executive if such termination had not
                  occurred, prorated as of the date of the termination of
                  Executive's employment; (C) with respect to the performance
                  period under the Long-Term Incentive Compensation Plan that
                  ends on the last day of the fiscal year in which the
                  employment of Executive is terminated, the Company shall pay
                  to Executive the payment under the Long-Term Incentive
                  Compensation Plan that Executive would otherwise have earned
                  with respect to such performance period if such termination
                  had not occurred, prorated as of the date of the termination
                  of Executive's employment, payment of such amount to be made
                  at the same time and in the same manner as other awards are
                  paid for such period; and (D) the Company shall provide
                  Executive for a period of one year following such termination
                  of employment, at no cost to Executive, with out-placement at
                  a level commensurate with that provided by the Company to
                  other comparably situated executives. Executive shall not be
                  required to mitigate the amount of any payment provided for in
                  the preceding sentence by seeking other employment, nor shall
                  any amounts to be received by Executive hereunder be reduced
                  by any other compensation earned.

                  (ii) In the event that Executive is not elected Chairman of
                  the Board of the Company (in addition to continuing in his
                  position as Chief Executive Officer) effective on a date on or
                  before March 4, 2002, Executive may, during the 30-day period
                  commencing on March 4, 2002 and ending on April 2, 2002, give
                  written notice to the Company of his election to resign his
                  position as President and Chief Executive Officer and
                  terminate this agreement. If Executive gives such notice,


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                  Executive's resignation as President and Chief Executive
                  Officer shall be effective 30 days following the date on which
                  such notice is given, this agreement shall terminate 30 days
                  following the date on which such notice is given, and
                  Executive shall be entitled to receive the payments, and shall
                  have such other rights, provided for in Section 5(c)(i)
                  hereof, except that the Executive shall become vested in
                  50,000 shares of the Restricted Stock and the balance of the
                  Restricted Stock shall be cancelled.

         (d)      Notwithstanding anything herein to the contrary, in the event
                  of a Change in Control, as defined in Attachment A hereto, the
                  Executive shall have the right to terminate the Employment
                  Period by written notice given within the 30 day period
                  following three months after such Change in Control. The
                  Employment Period shall cease upon the giving of such notice.
                  In such event, or in the event that the Company shall
                  terminate the Executive's employment without Cause or the
                  Executive shall terminate his employment for Good Reason
                  during the two year period after the Change in Control, the
                  amount payable to Executive under paragraph (c) (A) through
                  (D) above shall be not less than 1.5 times the sum of his Base
                  Salary and annual bonus at target, such amount to be paid in a
                  lump sum within 10 days following such termination of the
                  employment of Executive, and all of the restricted stock
                  granted to Executive pursuant to Section 4(g) and all of the
                  stock options granted to Executive pursuant to Section 4(f)
                  shall immediately become fully vested. For purposes of this
                  paragraph, (i) "Change in Control" shall have the meaning
                  specified in Attachment B hereto and (ii) "Good Reason" shall
                  mean (A) any material demotion of Executive or any material
                  reduction in Executive's authority or responsibility, except
                  in each case in connection with the termination of Executive's
                  employment for Cause or disability or as a result of
                  Executive's death, or temporarily as a result of Executive's
                  illness or other absence; (B) any reduction in Executive's
                  rate of Base Salary as payable from time to time; (C) a
                  reduction in Executive's annual bonus classification level
                  other

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                  than in connection with a redesign of the applicable bonus
                  plan that affects all employees at Executive's bonus level;
                  (D) a failure of the Company to continue in effect the
                  benefits applicable to, or the Company's reduction of the
                  benefits applicable to, Executive under any benefit plan or
                  arrangement (including without limitation, any pension, life
                  insurance, health or disability plan) in which Executive
                  participates as of the date of the Change in Control without
                  implementation of a substitute plan(s) providing materially
                  similar benefits in the aggregate to those discontinued or
                  reduced, except for a discontinuance of, or reduction under,
                  any such plan or arrangement that is legally required or
                  generally applies to all executives of the Company of a
                  similar level, provided that in either such event the Company
                  provides similar benefits (or the economic effect thereof) to
                  Executive in any manner determined by the Company; or (E)
                  failure of any successor to the Company to assume in writing
                  the obligations hereunder, or (F) a breach of any other
                  material provision of this Employment Agreement, which breach
                  is not corrected within 30 days following written notice to
                  the Company.

         6.       Gross-up. (a) In the event that Executive shall become
                  entitled to the payments and/or benefits provided by Section 5
                  or any other amounts (whether pursuant to the terms of this
                  Employment Agreement or any other plan, arrangement or
                  agreement with the Company, any person whose actions result in
                  a change of ownership covered by Code Section 280G(b)(2) or
                  any person affiliated with the Company or such person) as a
                  result of a Change in Control as defined in Attachment A
                  (collectively the "Company Payments"), and such Company
                  Payments will be subject to the tax (the "Excise Tax") imposed
                  by Section 4999 of the Code (and any similar tax that may
                  hereafter be imposed), the Company shall pay to Executive at
                  the time specified in paragraph (d) below an additional amount
                  (the "Gross-up Payment") such that the net amount retained by
                  Executive, after deduction of any Excise Tax on the Company
                  Payments and any federal, state and local income tax and
                  Excise Tax upon the Gross-up Payment provided

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                  for by this paragraph (a), but before deduction for any
                  federal, state or local income tax on the Company Payments,
                  shall be equal to the Company Payments.

         (b)      For purposes of determining whether any of the Company
                  Payments and Gross-up Payments (collectively the "Total
                  Payments") will be subject to the Excise Tax and the amount of
                  such Excise Tax, (a) the Total Payments shall be treated as
                  "parachute payments" within the meaning of Section 280G(b)(2)
                  of the Code, and all "parachute payments" in excess of the
                  "base amount" (as defined under Section 280G(b)(3) of the
                  Code) shall be treated as subject to the Excise Tax, unless
                  and except to the extent that, in the opinion of the Company's
                  independent certified public accountants appointed prior to
                  any change in ownership (as defined under Code Section
                  280G(b)(2)) or tax counsel selected by such accountants (the
                  "Accountants") such Total Payments (in whole or in part)
                  either do not constitute "parachute payments," represent
                  reasonable compensation for services actually rendered within
                  the meaning of Section 280G(b)(2) of the Code in excess of the
                  "base amount" or are otherwise not subject to the Excise Tax,
                  and (b) the value of any non-cash benefits or any deferred
                  payment or benefit shall be determined by the Accountants in
                  accordance with the principles of Section 280G of the Code.

         (c)      For purposes of determining the amount of the Gross-up
                  Payment, Executive shall be deemed to pay federal income taxes
                  at the highest marginal rate of federal income taxation in the
                  calendar year in which the Gross-up Payment is to be made and
                  state and local income taxes at the highest marginal rate of
                  taxation in the state and locality of Executive's residence
                  for the calendar year in which the Company Payment is to be
                  made, net of the maximum reduction in federal income taxes
                  which could be obtained from deduction of such state and local
                  taxes if paid in such year. In the event that the Excise tax
                  is subsequently determined by the Accountants to be less than
                  the amount taken into account

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                  hereunder at the time the Gross-up payment is made, Executive
                  shall repay to the Company, at the time that the amount of
                  such reduction in Excise Tax is finally determined, the
                  portion of the prior Gross-up Payment attributable to such
                  reduction (plus the portion of the Gross-up Payment
                  attributable to the Excise tax and federal and state and local
                  income tax imposed on the portion of the Gross-up Payment
                  being repaid by Executive if such repayment results in a
                  reduction in Excise Tax or a federal and state and local
                  income tax deduction), plus interest on the amount of such
                  repayment at the rate provided in Section 1274(b)(2)(B) of the
                  Code. Notwithstanding the foregoing, in the event any portion
                  of the Gross-up Payment to be refunded to the Company has been
                  paid to any federal, state or local tax authority, repayment
                  thereof (and related amounts) shall not be required until
                  actual refund or credit of such portion has been made to
                  Executive, and interest payable to the Company shall not be
                  required until actual refund or credit of such portion has
                  been made to Executive, and interest payable to the Company
                  shall not exceed the interest received or credited to
                  Executive by such tax authority for the period it held such
                  portion. Executive and the Company shall mutually agree upon
                  the course of action to be pursued (and the method of
                  allocating the expense thereof) if Executive's claim for
                  refund or credit is denied. In the event that the Excise Tax
                  is later determined by the Accountants or the Internal Revenue
                  Service to exceed the amount taken into account hereunder at
                  the time the Gross-up Payment is made (including by reason of
                  any payment the existence or amount of which cannot be
                  determined at the time of the Gross-up Payment), the Company
                  shall make an additional Gross-up Payment in respect of such
                  excess (plus any interest or penalties payable with respect to
                  such excess) at the time that the amount of such excess is
                  finally determined.

         (d)      The Gross-up Payment or portion thereof provided for in
                  paragraph (c) above shall be paid not later than the thirtieth
                  day following an event occurring which

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                  subjects Executive to the Excise Tax; provided, however, that
                  if the amount of such Gross-up Payment or portion thereof
                  cannot be finally determined on or before such day, the
                  Company shall pay to Executive on such day an estimate, as
                  determined in good faith by the Accountants, of the minimum
                  amount of such payments and shall pay the remainder of such
                  payments (together with interest at the rate provided in
                  Section 1274(b)(2)(B) of the Code), subject to further
                  payments pursuant to paragraph (c) hereof, as soon as the
                  amount thereof can reasonably be determined, but in no event
                  later than the ninetieth day after the occurrence of the event
                  subjecting Executive to the Excise Tax. In the event that the
                  amount of the estimated payments exceeds the amount
                  subsequently determined to have been due, such excess shall
                  constitute a loan by the Company to Executive, payable on the
                  fifth day after demand by the Company (together with interest
                  at the rate provided in Section 1274(b)(2)(B) of the Code).

         (e)      The Company shall be responsible for all charges of the
                  Accountants.

         7.       Indemnification. The Company agrees that the Executive shall
                  be entitled to the benefits of the indemnity provisions set
                  forth in the Certificate of Incorporation and the By-laws from
                  time to time in accordance with their terms both during his
                  employment and thereafter with regard to his actions as an
                  officer or director of the Company and that the Company shall
                  enter into an indemnification agreement with the Executive in
                  the form of its standard indemnification agreement with
                  executive officers. In addition, the Company agrees to
                  continue in effect for the benefit of the Executive during the
                  Employment Period directors' and officers' liability insurance
                  of the type and in the amount currently maintained by the
                  Company to the extent such insurance is available at a premium
                  cost which the Company considers reasonable and, thereafter,
                  with regard to his prior activities as an officer or director,
                  such insurance as is maintained for active directors and
                  officers.

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         8.       Confidential Information and Non-Competition.

         (a)      Executive agrees that during the Employment Period and
                  thereafter he shall not disclose, at any time, to any person,
                  or use for his own account, nonpublic information of any kind
                  concerning the Company or any of its subsidiaries or
                  affiliates, including, but not limited to, nonpublic
                  information concerning finances, financial plans, accounting
                  methods, strategic plans, operations, personnel,
                  organizational structure, methods of distribution, suppliers,
                  customers, client relationships, marketing strategies, store
                  lists, real estate strategies, or the like ("Confidential
                  Information"). During such period, Executive shall not,
                  without the prior written consent of the Company, unless
                  compelled pursuant to the order of a court or other body
                  having jurisdiction over such matter and unless required by
                  lawful process or subpoena, communicate or divulge any
                  Confidential Information to anyone other than the Company and
                  those designated by the Company. Executive agrees that during
                  the Employment Period he will not breach his obligations to
                  comply with the provisions of the Code of Corporate Conduct of
                  the Company, as in effect on the date hereof and as may be
                  amended from time to time.

         (b)      Executive recognizes that Confidential Information has been
                  developed by the Company and its affiliates at substantial
                  cost and constitute valuable and unique property of the
                  Company. Executive acknowledges that the foregoing makes it
                  reasonably necessary for the protection of the Company's
                  interests that Executive not compete with the Company or its
                  affiliates during the Employment Period and for a reasonable
                  and limited period thereafter. Therefore, Executive agrees
                  that during the term of this agreement and for a period of two
                  years thereafter, Executive shall not engage in Competition.
                  As used herein, "Competition" shall mean (i) participating,
                  directly or indirectly, as an individual proprietor,
                  stockholder, officer, employee, director, joint venturer,
                  investor, lender, consultant, or in any capacity whatsoever


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                  (within the United States of America, or in any country where
                  the Company or any of its subsidiaries or affiliates does
                  business) in (A) a business in competition with the retail,
                  catalog, or on-line sale of athletic footwear, athletic
                  apparel, and sporting goods conducted by the Company or any of
                  its subsidiaries or affiliates (the "Athletic Business") or
                  (B) a business that in the prior fiscal year supplied product
                  to the Company or any of its subsidiaries or affiliates for
                  the Athletic Business having a value of $20 million or more at
                  cost to the Company or any of its subsidiaries or affiliates;
                  provided, however, that (X) such participation shall not
                  include the mere ownership of not more than 1 percent of the
                  total outstanding stock of a publicly traded company and (Y) a
                  department store or general or merchandise store shall not be
                  a business in competition with any business conducted by the
                  Company; or (ii) the intentional recruiting, soliciting or
                  inducing of any employee or employees of the Company or any of
                  its subsidiaries or affiliates to terminate their employment
                  with, or otherwise cease their relationship with, the Company
                  or any of its subsidiaries or affiliates where such employee
                  or employees do in fact so terminate their employment.

         (c)      Executive agrees (i) that his services are special and
                  extraordinary, (ii) that a violation of his commitment not to
                  disclose Confidential Information or otherwise to engage in
                  acts of Competition would immediately and irreparably harm the
                  Company, and (iii) that such harm would be incapable of
                  adequate remediation by money damages. Accordingly, Executive
                  agrees that this paragraph 8 may be enforced by injunction,
                  and that he will interpose no objection or defense to such
                  enforcement. Enforcement by injunction shall not bar the
                  Company from any other legal or equitable remedies to which it
                  may be entitled for such violation. If any restriction set
                  forth with regard to Competition is found by any court of
                  competent jurisdiction to be unenforceable because it extends
                  for too long a period of time or over too great a range of
                  activities or in too broad a geographic area, it is the
                  intention of the parties that the court should interpret and
                  enforce such restriction to its fullest lawful extent.

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         9.   1998 Agreement. The 1998 Agreement is hereby terminated, effective
              as of 12:00 Midnight on March 3, 2001, without further obligation
              of either party to the other, and shall thereafter be of no force
              and effect. Notwithstanding the foregoing, the parties acknowledge
              that they are parties to Restricted Stock Agreements dated
              September 21, 1998, November 10, 1999, and February 9, 2000, and
              Stock Option Agreements dated September 21, 1998 and February 9,
              2000, which agreements shall remain in full force and effect in
              accordance with their terms.

         10.  Assignment. This agreement shall be binding upon and inure to the
              benefit of the parties hereto and their respective successors,
              heirs, and permitted assigns. This agreement is personal to
              Executive and neither this agreement or any rights hereunder may
              be assigned by him. No rights or obligations of the Company under
              this agreement may be assigned or transferred by the Company
              except that such rights or obligations may be assigned or
              transferred pursuant to a merger or consolidation in which the
              Company is not the continuing entity, or pursuant to a sale of all
              or substantially all of the assets of the Company, provided that
              the assignee or transferee is the successor to all or
              substantially all of the assets of the Company and such assignee
              or transferee assumes the liabilities, obligations and duties of
              the Company, as contained in this agreement, either contractually
              or as a matter of law.

        11.   Arbitration. Any controversy or claim arising out of or relating
              to this agreement, or the breach thereof, shall be settled by
              arbitration in the City of New York, in accordance with the rules
              of the American Arbitration Association (the "AAA"); provided,
              however, that this Section shall not apply to Section 8 herein.
              The decision of the arbitrator(s) shall be final and binding on
              the parties hereto and judgment upon the award rendered by the
              arbitrator(s) may be entered in any court having jurisdiction
              thereof. The costs assessed by the AAA for arbitration shall be
              borne equally by both

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              parties.

         12.  Notice. Any notice to either party hereunder shall be in writing,
              and shall be deemed to be sufficiently given to or served on such
              party, for all purposes, if the same shall be personally delivered
              to such party, or sent to such party by registered mail, postage
              prepaid, in the case of Executive, at his principal residence
              address as shown in the records of the Company, and in the case of
              the Company, to the General Counsel, Venator Group, Inc., 112 West
              34 Street, New York, New York 10120. Either party hereto may
              change the address to which notices are to be sent to such party
              hereunder by written notice of such new address given to the other
              party hereto. Notices shall be deemed given when received if
              delivered personally or three (3) days after mailing if mailed as
              aforesaid.

         13.  Applicable Law. This agreement shall be governed by and construed
              and enforced in accordance with the laws of the State of New York
              applicable to contracts between residents of such state to be
              performed therein.

         14.  Miscellaneous.

              (a)      This agreement represents the entire understanding of
                       the parties hereto, supersedes any prior understandings
                       or agreements between the parties, and the terms and
                       provisions of this agreement may not be modified or
                       amended except in a writing signed by both parties.

              (b)      No waiver by either party of any breach by the other
                       party of any condition or provision contained in this
                       agreement to be fulfilled or performed by such other
                       party shall be deemed a waiver of a similar or
                       dissimilar condition or provision at the same or any
                       prior or subsequent time. Except to the extent otherwise

                                       17
<PAGE>   18

                       specifically provided herein, any waiver must be in
                       writing and signed by you or an authorized officer of
                       the Company, as the case may be.


         IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Employment Agreement as of the day and year first above written.

                                                     VENATOR GROUP, INC.
                                            By:      ________________________




                                                     ________________________
                                                     Matthew D. Serra


                                       18
<PAGE>   19
                                  Attachment A

                                Change in Control

     A Change in Control shall mean any of the following: (i) (A) the making of
a tender or exchange offer by any person or entity or group of associated
persons or entities (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934) (a "Person") (other than the Company or its
Affiliates) for shares of common stock pursuant to which purchases are made of
securities representing at least twenty percent (20%) of the total combined
voting power of the Company's then issued and outstanding voting securities; (B)
the merger or consolidation of the Company with, or the sale or disposition of
all or substantially all of the assets of the Company to, any Person other than
(a) a merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving or parent entity) fifty percent (50%) or more of the combined voting
power of the voting securities of the Company or such surviving or parent entity
outstanding immediately after such merger or consolidation; or (b) a merger or
capitalization effected to implement a recapitalization of the Company (or
similar transaction) in which no Person is or becomes the beneficial owner,
directly or indirectly (as determined under Rule 13d-3 promulgated under the
Securities Exchange Act of 1934), of securities representing more than the
amounts set forth in (C) below; (C) the acquisition of direct or indirect
beneficial ownership (as determined under Rule 13d-3 promulgated under the
Securities Exchange Act of 1934), in the aggregate, of securities of the Company
representing twenty percent (20%) or more of the total combined voting power of
the Company's then issued and outstanding voting securities by any Person acting
in concert as of the date of this Agreement; provided, however, that the Board
may at any time and from time to time and in the sole discretion of the Board,
as the case may be, increase the voting security ownership percentage threshold
of this item (C) to an amount not exceeding forty percent (40%); or (D) the
approval by the shareholders of the Company of any plan or proposal for the
complete liquidation or dissolution of the Company or for the sale of all or

                                       19
<PAGE>   20

substantially all of the assets of the Company; or (ii) during any period of not
more than two (2) consecutive years, individuals who at the beginning of such
period constitute the Board, any new director (other than a director designated
by a person who has entered into agreement with the Company to effect a
transaction described in clause (i)) whose election by the Board or nomination
for election by the Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a majority
thereof.

                                       20
<PAGE>   21
                                  Attachment B

                        RESTRICTED STOCK AWARD AGREEMENT
                             UNDER THE VENATOR GROUP
                        1995 STOCK OPTION AND AWARD PLAN

     This Restricted Stock Award Agreement (the "Agreement") made under the
Venator Group 1995 Stock Option and Award Plan (the "Plan") as of the 4th day of
March 2001 by and between Venator Group, Inc., a New York corporation with its
principal office located at 112 West 34th Street, New York, New York 10120 (the
"Company") and Matthew D. Serra (the "Executive").

         Effective March 4, 2001 (the "Date of Grant"), the Compensation and
Management Resources Committee of the Board of Directors of the Company granted
the Executive an award of 150,000 shares of Restricted Stock under the Plan,
subject to the terms of the Plan and the restrictions set forth in this
Agreement.

1.       Grant of Shares

         The Company is transferring to the Executive 150,000 shares of validly
issued Common Stock of the Company, par value $.01 per share (the "Restricted
Stock"). Such shares are fully paid and nonassessable and upon transfer shall be
validly issued and outstanding. The shares are subject to certain restrictions
pursuant to Section 3 hereof, which restrictions shall expire as provided in
Section 3.3 hereof.

2.       Restrictions on Transfer

         The Employee shall not sell, transfer, pledge, hypothecate, assign or
otherwise dispose of the Restricted Stock, except as set forth in this
Agreement. Any attempted sale, transfer, pledge, hypothecation, assignment or
other disposition of the shares in violation of this Agreement shall be void and
of no effect and the Company shall have the right to disregard the same on its
books and records and to issue "stop transfer" instructions to its transfer
agent.

3.       Restricted Stock

         3.1 Deposit of Certificates. The Executive will deposit with and
deliver to the Company the stock certificate or certificates representing the
Restricted Stock, each duly endorsed in blank or accompanied by stock powers
duly executed in blank. In the event the Executive receives a stock dividend on
the Restricted Stock or the Restricted Stock is split or the Executive receives
any other shares, securities, monies, or property representing a dividend on the
Restricted Stock (other than regular cash dividends on and after the date of
this Agreement) or representing a distribution or return of capital upon or in
respect of the Restricted Stock or any

                                       21
<PAGE>   22
part thereof, or resulting from a split-up, reclassification or other like
changes of the Restricted Stock, or otherwise received in exchange therefor, and
any warrants, rights or options issued to the Executive in respect of the
Restricted Stock (collectively the "RS Property"), the Executive will also
immediately deposit with and deliver to the Company any of such RS Property,
including any certificates representing shares duly endorsed in blank or
accompanied by stock powers duly executed in blank, and such RS Property shall
be subject to the same restrictions, including that of this Section 3.1, as the
Restricted Stock with regard to which they are issued and shall herein be
encompassed within the term "Restricted Stock."

         3.2 Rights with Regard to the Restricted Stock. The Restricted Stock
has been transferred from either the Company's treasury or newly issued stock
and, therefore, upon delivery to the Executive will constitute issued and
outstanding shares of Common Stock for all corporate purposes. From and after
the date of transfer, the Executive will have the right to vote the Restricted
Stock, to receive and retain all regular cash dividends payable to record
holders of Common Stock on and after the transfer of the Restricted Stock
(although such dividends shall be treated, to the extent required by law, as
additional compensation for tax purposes if paid on Restricted Stock), and to
exercise all other rights, powers and privileges of a holder of Common Stock
with respect to the Restricted Stock, with the exceptions that (i) the Executive
will not be entitled to delivery of the stock certificate or certificates
representing the Restricted Stock until the restriction period shall have
expired and unless all other vesting requirements with respect thereto shall
have been fulfilled, (ii) the Company will retain custody of the stock
certificate or certificates representing the Restricted Stock and the other RS
Property during the restriction period, (iii) no RS Property shall bear interest
or be segregated in separate accounts during the restriction period and (iv) the
Executive may not sell, assign, transfer, pledge, exchange, encumber or dispose
of the Restricted Stock during the restriction period.

         3.3      Vesting.

                  The Restricted Stock shall become 100% vested and cease to be
Restricted Stock (but still subject to the other terms of the Plan and this
Agreement) on January 31, 2004 if the Executive has been continuously employed
by the Company or its subsidiaries within the meaning of Section 424 of the
Internal Revenue Code of 1986, as amended (the "Control Group") until such date.

         Other than as may be provided for under Section 3.4 hereof, there shall
be no proportionate or partial vesting in the periods prior to the appropriate
vesting date and all vesting shall occur only on the appropriate vesting date.

         When any Restricted Stock becomes vested, the Company shall promptly
issue and deliver to the Executive a new stock certificate registered in the
name of the Executive for such shares without the legend set forth in Section 4
hereof and deliver to the Executive any related other RS Property.

                                       22
<PAGE>   23

         In addition, all shares of Restricted Stock shall become immediately
vested and cease to be Restricted Stock upon any Change in Control as defined in
Appendix A hereto.

         3.4 Forfeiture. In the event of the Executive's death, disability, or
resignation, the Executive shall forfeit to the Company, without compensation,
all unvested shares of Restricted Stock; provided that (i) in the event of the
death or disability of the Executive, or (ii) in the event that the Executive
ceases to be employed by the Company or any subsidiary or affiliate of the
Company as a result of the closing, sale, spin-off or other divestiture of any
operation of the Company, the Compensation and Management Resources Committee of
the Board of Directors of the Company may, in its sole discretion, but shall not
be obligated to, fully vest and not forfeit all or any portion of the
Executive's Restricted Stock; and provided further that (A) in the event that
the employment of the Executive by the Company is terminated in a manner that
gives rise to the payments provided for in Section 5(c)(i) of the Employment
Agreement between Executive and the Company dated February 12, 2001 (the
"Employment Agreement"), the Restricted Stock shall become fully vested as of
the date of the termination of his employment, and (B) in the event that
Executive elects to terminate his employment with the Company under the
provisions of Section 5(c)(ii) of the Employment Agreement, 50,000 shares of the
Restricted Stock shall become fully vested as of the date of the termination of
his employment.

         3.5 Adjustments. In the event of any stock dividend, split up,
split-off, spin-off, distribution, recapitalization, combination or exchange of
shares, merger, consolidation, reorganization or liquidation or the like, the
Restricted Stock shall, where appropriate in the sole discretion of the
Compensation and Management Resources Committee of the Board of Directors of the
Company, receive the same distributions as other shares of Common Stock or on
some other basis as determined by the Compensation and Management Resources
Committee of the Board of Directors. In any such event, the Compensation and
Management Resources Committee of the Board of Directors may, in its sole
discretion, determine to award additional Restricted Stock in lieu of the
distribution or adjustment being made with respect to other shares of Common
Stock. In any such event, the determination made by the Compensation and
Management Resources Committee of the Board of Directors shall be conclusive.
The Compensation and Management Resources Committee of the Board of Directors
may, in its sole discretion, at any time fully vest and not forfeit all or any
portion of the Executive's Restricted Stock.

     3.6 Withholding. The Employee agrees that, subject to subsection 3.7 below,

                  (a) No later than the date on which any Restricted Stock shall
have become vested, the Executive will pay to the Company, or make arrangements
satisfactory to the Company regarding payment of, any federal, state or local
taxes of any kind required by law to be withheld with respect to any Restricted
Stock which shall have become so vested;

                  (b) The Company shall, to the extent permitted by law, have
the right to deduct from any payment of any kind otherwise due to the Executive
any federal, state or local

                                       23
<PAGE>   24
taxes of any kind required by law to be withheld with respect to any Restricted
Stock which shall have become so vested; and

                  (c) In the event the Executive does not satisfy (a) above on a
timely basis, the Company may, but shall not be required to, pay such required
withholding and treat such amount as a demand loan to the Employee at the
maximum rate permitted by law, with such loan, at the Company's sole discretion
and provided the Company so notifies the Employee within thirty (30) days of the
making of the loan, secured by the shares of Common Stock and any failure by the
Executive to pay the loan upon demand shall entitle the Company to all of the
rights at law of a creditor secured by the shares of Common Stock. The Company
may hold as security any certificates representing any shares of Common Stock
and, upon demand of the Company, the Executive shall deliver to the Company any
certificates in his possession representing shares of Common Stock together with
a stock power duly endorsed in blank.

         3.7 Section 83(b). If the Executive properly elects (as required by
Section 83(b) of the Internal Revenue Code of 1986, as amended) within thirty
(30) days after the issuance of the Restricted Stock to include in gross income
for federal income tax purposes in the year of issuance the fair market value of
such Restricted Stock, the Executive shall pay to the Company or make
arrangements satisfactory to the Company to pay to the Company upon such
election, any federal, state or local taxes required to be withheld with respect
to such Restricted Stock. If the Executive shall fail to make such payment, the
Company shall, to the extent permitted by law, have the right to deduct from any
payment of any kind otherwise due to the Executive any federal, state or local
taxes of any kind required by law to be withheld with respect to such Restricted
Stock, as well as the rights set forth in Section 3.6(c) hereof. The Executive
acknowledges that it is his sole responsibility, and not the Company's, to file
timely the election under Section 83(b) of the Internal Revenue Code of 1986, as
amended, and any corresponding provisions of state tax laws if he elects to
utilize such election.

         3.8 Special Incentive Compensation. The Executive agrees that the award
of the Restricted Stock hereunder is special incentive compensation and that it,
any dividends paid thereon (even if treated as compensation for tax purposes)
and any other RS Property will not be taken into account as "salary" or
"compensation" or "bonus" in determining the amount of any payment under any
pension, retirement or profit-sharing plan of the Company or any life insurance,
disability or other benefit plan of the Company.

         3.9 Delivery Delay. The delivery of any certificate representing
Restricted Stock or other RS Property may be postponed by the Company for such
period as may be required for it to comply with any applicable federal or state
securities law, or any national securities exchange listing requirements and the
Company is not obligated to issue or deliver any securities if, in the opinion
of counsel for the Company, the issuance of such shares shall constitute a
violation by the Executive or the Company of any provisions of any law or of any
regulations of any governmental authority or any national securities exchange.

                                       24
<PAGE>   25

         4. Legend. All certificates representing shares of Restricted Stock
shall have endorsed thereon a legend referring to the terms, conditions and
restrictions applicable to such Restricted Stock, substantially in the following
form:

                  "The anticipation, alienation, attachment, sale, transfer,
assignment, pledge, encumbrance or charge of the shares of stock represented
hereby are subject to the terms and conditions (including forfeiture) of the
Venator Group (the "Company") 1995 Stock Option and Award Plan and an Agreement
entered into between the registered owner and the Company dated March 4, 2001.
Copies of such Plan and Agreement are on file at the principal office of the
Company."

         5. Not an Employment Agreement. The issuance of the shares of
Restricted Stock hereunder does not constitute an agreement by the Company to
continue to employ the Executive during the entire, or any portion of the, term
of this Agreement, including but not limited to any period during which the
Restricted Stock is outstanding.

         6. Power of Attorney. The Company, its successors and assigns, is
hereby appointed the attorney-in-fact, with full power of substitution, of the
Executive for the purpose of carrying out the provisions of this Agreement and
taking any action and executing any instruments which such attorney-in-fact may
deem necessary or advisable to accomplish the purposes hereof, which appointment
as attorney-in-fact is irrevocable and coupled with an interest. The Company, as
attorney-in-fact for the Executive, may, in the name and stead of the Executive,
make and execute all conveyances, assignments and transfers of the Restricted
Stock, Shares and property provided for herein, and the Executive hereby
ratifies and confirms all that the Company, as said attorney-in-fact, shall do
by virtue hereof. Nevertheless, the Executive shall, if so requested by the
Company, execute and deliver to the Company all such instruments as may, in the
judgment of the Company, be advisable for the purpose.

         7. Miscellaneous.

            7.1 This Agreement shall inure to the benefit of and be binding upon
all parties hereto and their respective heirs, legal representatives, successors
and assigns.

            7.2 This Agreement constitutes the entire agreement between the
parties and cannot be changed or terminated orally. No modification or waiver of
any of the provisions hereof shall be effective unless in writing and signed by
the party against whom it is sought to be enforced.

            7.3 This Agreement may be executed in one or more counterparts, all
of which taken together shall constitute one contract.

            7.4 The failure of any party hereto at any time to require


                                       25
<PAGE>   26
performance by another party of any provision of this Agreement shall not affect
the right of such party to require performance of that provision, and any waiver
by any party of any breach of any provision of this Agreement shall not be
construed as a waiver of any continuing or succeeding breach of such provision,
a waiver of the provision itself, or a waiver of any right under this Agreement.

            7.5 This Agreement is subject, in all respects, to the provisions of
the Plan, and to the extent any provision of this Agreement contravenes or is
inconsistent with any provision of the Plan, the provisions of the Plan shall
govern.

            7.6 The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall in no way restrict or
modify any of the terms or provisions hereof.

            7.7 All notices, consents, requests, approvals, instructions and
other communications provided for herein shall be in writing and validly given
or made when delivered, or on the second succeeding business day after being
mailed by registered or certified mail, whichever is earlier, to the persons
entitled or required to receive the same, at, in the case of the Company, the
address set forth at the heading of this Agreement and, in the case of the
Executive, his principal residence address as shown in the records of the
Company, or to such other address as either party may designate by like notice.
Notices to the Company shall be addressed to the Chairman of the Compensation
and Management Resources Committee with a copy similarly sent to the General
Counsel.

            7.8 This Agreement shall be governed and construed and the legal
relationships of the parties determined in accordance with the internal laws of
the State of New York.

            7.9 To indicate your acceptance of the terms of this Restricted
Stock Award Agreement, you must sign and deliver or mail not later than 30 days
from the date hereof, a copy of this Agreement to the General Counsel of the
Company at the address provided in the heading of this Agreement.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.


                                         VENATOR GROUP, INC.


                                         By:
                                            --------------------------------
                                              Senior Vice President


                                            --------------------------------


                                       26
<PAGE>   27
                                              Matthew D. Serra



                                       27
<PAGE>   28

                                 ACKNOWLEDGMENT


STATE OF                                     )
         --------------------------------
                                             ) s.s.:
COUNTY OF                                    )
          --------------------------------


     On this    day of     2001, before me personally appeared Matthew D. Serra
, to me known to be the person described in and who executed the foregoing
agreement, and acknowledged that he executed the same as his free act and deed.



                                                --------------------------------
                                                        Notary Public


                                       28
<PAGE>   29


                                   APPENDIX A

                                CHANGE IN CONTROL

         A Change in Control shall mean any of the following: (i) (A) the making
of a tender or exchange offer by any person or entity or group of associated
persons or entities (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934) (a "Person") (other than the Company or its
Affiliates) for shares of Common Stock pursuant to which purchases are made of
securities representing at least twenty percent (20%) of the total combined
voting power of the Company's then issued and outstanding voting securities; (B)
the merger or consolidation of the Company with, or the sale or disposition of
all or substantially all of the assets of the Company to, any Person other than
(a) a merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving or parent entity) fifty percent (50%) or more of the combined voting
power of the voting securities of the Company or such surviving or parent entity
outstanding immediately after such merger or consolidation; or (b) a merger or
capitalization effected to implement a recapitalization of the Company (or
similar transaction) in which no Person is or becomes the beneficial owner,
directly or indirectly (as determined under Rule 13d-3 promulgated under the
Securities Exchange Act of 1934), of securities representing more than the
amounts set forth in (C) below; (C) the acquisition of direct or indirect
beneficial ownership (as determined under Rule 13d-3 promulgated under the
Securities Exchange Act of 1934), in the aggregate, of securities of the Company
representing twenty percent (20%) or more of the total combined voting power of
the Company's then issued and outstanding voting securities by any Person acting
in concert as of the date of this Agreement; provided, however, that the Board
of Directors of the Company (referred to herein as the "Board") may at any time
and from time to time and in the sole discretion of the Board, as the case may
be, increase the voting security ownership percentage threshold of this item (C)
to an amount not exceeding forty percent (40%); or (D) the approval by the
shareholders of the Company of any plan or proposal for the complete liquidation
or dissolution of the Company or for the sale of all or substantially all of the
assets of the Company; or (ii) during any period of not more than two (2)
consecutive years, individuals who at the beginning of such period constitute
the Board, and any new director (other than a director designated by a person
who has entered into agreement with the Company to effect a transaction
described in clause (i)) whose election by the Board or nomination for election
by the Company's shareholders was approved by a vote of at least two-thirds (")
of the directors then still in office who either were directors at the beginning
of the period or whose election or nomination for election was previously so
approved, cease for any reason to constitute at least a majority thereof.



                                       29