AGREEMENT AND GENERAL RELEASE

         THIS AGREEMENT AND GENERAL RELEASE ("Agreement") is entered into by and
between THOMAS BAUMLIN on his/her own behalf and on behalf of his/her
representatives, attorneys, heirs, executors, administrators, successors and
assigns (hereinafter collectively, "Employee"), and FOOTSTAR CORPORATION on
behalf of itself, Footstar, Inc. and each of their respective subsidiaries,
affiliates, divisions, officers, directors, employees, agents, representatives,
attorneys, successors and assigns (hereinafter "FOOTSTAR" and/or "Company"). In
consideration of the covenants, conditions and obligations set forth herein the
parties agree as follows:

1.      Employee's last day of work with FOOTSTAR shall be January 31, 2003.

2.      FOOTSTAR agrees to pay Employee an amount equal to 78 weeks pay
        calculated to be $408,000.00 (Four Hundred Eight Thousand Dollars and 00
        cents). Said payment to be paid to Employee in (39) biweekly
        installments of $10,461.54 (Ten Thousand Four Hundred Sixty One Dollars
        and 54 cents), less all required withholdings and/or deductions,
        provided FOOTSTAR is in receipt of a fully executed original of this
        Agreement. Employee acknowledges that such consideration is separate
        from and in addition to any Company compensation and/or benefits due
        Employee.

3.      FOOTSTAR agrees not to contest any claim by Employee for unemployment
        benefits.

4.      EMPLOYEE BENEFIT PLANS: During the period in which payments are being
        made pursuant to Paragraphs (2) Employee shall be permitted to continue
        to participate in the Medical and Dental Plans ("Plans" or "Plan") that
        were in effect for the Employee on the day immediately preceding
        Employee's separation. Notwithstanding anything to the contrary
        contained herein, it is agreed and understood that in the event medical
        and/or dental insurance coverage becomes available as a result of
        obtaining other employment, then in that event, Employee shall promptly
        notify the Company and the medical and dental insurance coverage
        described herein shall cease. It is further understood and agreed that
        FOOTSTAR, in its sole discretion, may from time to time, during the
        period following Employee's separation, increase or decrease the monthly
        contributions or change Plan provisions. If such changes are
        implemented, Employee's contributions and/or coverage will change in the
        same manner as for other active employees participating in the Plan. The
        medical benefit continuation referred to in this paragraph will be
        provided through COBRA. Employee contributions for this coverage will
        remain at the same level an active employee pays under the group plan.
        If Employee is eligible to elect medical coverage beyond this period,
        the full COBRA rates will apply. Employee will not be entitled to
        participate in the Company's short term or long term disability plans or
        its life insurance program after January 31, 2003.


<PAGE>


5.      CAREER EQUITY PLAN (CEP): Employee shall immediately vest in and have
        delivered to him all outstanding shares in his Career Equity Plan
        account relating to completed performance cycles as soon as practicable
        after January 31, 2003.

6.      DEFERRED RESTRICTED STOCK: Employee shall receive a pro-rata amount of
        Employee's Deferred Restricted Stock as soon as practicable after
        January 31, 2003 which amount shall be calculated by multiplying the
        amount of such stock by a fraction the numerator of which shall be the
        completed years of employment with the Company following the date such
        stock was awarded and the denominator of which shall be five (5).

7.      SWITCH TO EQUITY PLAN (STEP): Employee shall receive as soon as
        practicable after January 31, 2003 (a) 100% of the Employee's deferred
        vested shares and (b) Company "matching" shares equal to the number of
        unvested matching shares multiplied by a fraction the numerator of which
        shall be the number of completed months of employment with the Company
        following the date on which such "match" was granted and the denominator
        of which shall be sixty (60).

8.      STOCK OPTIONS: Employee shall continue to vest in any outstanding stock
        options through January 31, 2003 and shall have the right to exercise
        such stock options pursuant to the terms of such options through the
        last day a payment is made pursuant to Paragraph (2), or the remainder
        of the exercise period, if less. Employee shall not be eligible for any
        additional stock option grants and shall forfeit any stock options
        vested as of January 31,2003 and shall forfeit any stock options vested
        as of January 31, 2003 but not exercised as of the last day a payment is
        made pursuant to Paragraph (2), or the end of the exercise period, if
        less.

9.      ASSOCIATE STOCK PURCHASE PLAN (ASPP): Employee shall not be entitled to
        participate in the Associate Stock Purchase Plan after January 31, 2003.

10.     401 (K) PROFIT SHARING PLAN: Employee shall not be entitled to make
        contributions to his 401(k) account after January 31, 2003.



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11.     It is agreed that the sums paid in accordance with Paragraphs (2) (5)
        (6) (7) and (8) shall be deemed to include and shall constitute full
        payment for any and all vacation, vacation pay, incentive compensation,
        severance compensation, bonuses, commissions, draws and other forms of
        compensation to which Employee may be entitled, and whether earned or
        calculated on a pro rata basis; except for any unused, accrued 2003
        vacation time.

12.     In consideration for the Company's agreement to the provisions and
        payment of amounts set forth in this Agreement:

        (A)    Employee expressly releases and forever discharges the Company
               and its representatives, agents, predecessors, successors, parent
               companies, subsidiaries, affiliates, principals and insurers (and
               their current and former officers, directors, employees, agents,
               shareholders, successors and assigns), and any and all employee
               benefit plans (and any fiduciary of such plans) sponsored by any
               of them, and all other persons, firms or corporations who might
               be claimed to be liable by Employee, from any and all claims,
               actions, causes of action, losses, damages (including actual,
               liquidated, compensatory, punitive or other damages), demands,
               promises, agreements, obligations, costs, expenses and attorneys
               fees, known or unknown, which Employee now has or may later
               discover or which may hereafter exist against them, or any of
               them, in connection with or arising directly or indirectly out of
               or in any way related to any and all matters, transactions,
               events or other things occurring prior to the effective date of
               this Agreement, including those arising out of or in connection
               with Employee's employment with FOOTSTAR or arising out of
               events, facts or circumstances which either preceded, flowed from
               or followed the cessation of Employee's employment with FOOTSTAR,
               or which occurred during the course of Employee's employment with
               FOOTSTAR or incidental thereto, and including but not limited to
               any arising under Title VII of the Civil Rights Act of 1964, as
               amended; the Civil Rights Act of 1991, as amended; the Employee
               Retirement Income Security Act of 1964, as amended, the Family
               and Medical Leave Act, as amended; 42 U.S.C. Section 1981 through
               1988, CEPA (N.J.S.A. 34:19-1 et.seq.), the Occupational Safety
               and Health Act, the American's with Disabilities Act, the Fair
               Credit Reporting Act, the Immigration Reform Control Act, the
               National Labor Relations Act, or under any other federal, state
               or local civil or human rights law or any other local, state or
               federal law, ordinance and regulation, or under common law.



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<PAGE>


        (B)    Other than pursuant to a valid subpoena, court order commanding
               attendance or testimony, or as may otherwise be provided by law:
               (i) Employee will not instigate the commencement of, or
               participate or assist in, any actions, suits or causes of action
               or claims on behalf of Employee or other persons against the
               Company, that in any way involves the subject matter of this
               Agreement; and (ii) Employee will not instigate the commencement
               of, or participate or assist in any actions, suits or causes of
               action or claims brought by or on behalf of any present or
               previous employees against the Company unless otherwise provided
               by law. Nothing herein is intended to or shall preclude Employee
               from cooperating with federal, state, local government or law
               enforcement agencies in any investigation. Employee, however,
               shall not be entitled to any relief, recovery or monies in
               connection with any action, suit, cause of action, or claim
               brought against the Company, without regard to who brought the
               action, suit, cause of action or claim.

        (C)    Employee understands and agrees that the claims released and
               discharged herein are forever waived and relinquished by this
               Agreement, and that this Agreement expressly contemplates the
               total extinguishment of any and all such claims. Employee further
               understands and agrees that Employee has no right or claim to
               employment with FOOTSTAR at any time after the effective date of
               this Agreement. Employee specifically acknowledges that this
               provision applies equally to all persons and entities described
               in Paragraph 12(A) above as well as to FOOTSTAR, itself.

13.     Employee agrees to cooperate with the Company by making himself
        available to testify on behalf of the Company or any Subsidiary or
        affiliate of the Company, in any action, suit, or proceeding, whether
        civil, criminal, administrative or investigative, and to assist the
        Company, or any Subsidiary or affiliate of the Company, in any action,
        suit or proceeding, by providing information and meeting and consulting
        with Company representatives or counsel or any Subsidiary or affiliate
        of the Company as requested. The Company agrees to reimburse Employee,
        for all reasonable and necessary out of pocket expenses incurred in
        connection with his provision of testimony or assistance (excluding
        attorneys fees which will only be covered to the extent covered by the
        Directors and Officers liability policy in effect during Employee's
        service as an officer of the Company). A breach of this provision by
        Employee shall be considered a material breach of this Agreement.





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<PAGE>



14.     LIABILITY INSURANCE. INDEMNIFICATION. The Company acknowledges that
        Employee was covered by the Company's Director's & Officers liability
        insurance policy during the course of his employment as an Officer of
        the Company. The Company agrees that if the Employee is made a party, or
        is threatened to be made a party, to any action, suit or proceeding,
        whether civil or criminal (a "Proceeding"), by reason of the fact that
        he was a director, officer or employee of the Company, the Employee
        shall be indemnified and held harmless by the Company to the fullest
        extent legally permitted or authorized by the Company's Director's &
        Officer's liability insurance policy against all cost, expense,
        liability and loss (including, without limitation, attorneys fees,
        judgments, fines, or penalties and amounts paid or to be paid in
        settlement) reasonably incurred or suffered by the Employee in
        connection therewith. The Company has provided Employee with a copy of
        the Directors and Officers liability insurance policy in effect during
        Employee's employment as an Officer of the Company.

15.      Employee represents and agrees that Employee will keep confidential and
         shall not disclose or discuss the contents of this Agreement. The sole
         exceptions to this confidentiality provision are for communications to
         Employee's immediate family, personal attorney (and attorney's
         employees), accountant or financial advisor, potential future employers
         to the extent necessary, or as required by law and then only on the
         condition that Employee shall advise such person or entity that the
         terms of the Agreement are confidential and further disclosure is
         prohibited. A breach of this provision shall be considered a material
         breach of this Agreement.

16.     Employee agrees that Employee will make no statements or remarks to
        anyone, including any of Employee's potential employers or to the
        Company suppliers, vendors or customers, about FOOTSTAR or any of the
        entities and persons described in Paragraph 12(A) above, that are
        disparaging, derogatory or defamatory to them. Employee further agrees
        that he shall not make or publish any written or oral statements or
        opinions regarding Employer, including its present and former employees,
        officers and directors. Employee agrees only to state that employee was
        employed by Employer, the position held, the dates of Employee's
        employment and Employee's compensation. Notwithstanding the foregoing
        provisions, nothing herein shall preclude Employee from making
        statements to any appropriate agency of the federal, state or local
        government, or if compelled by legal process. A breach of this provision
        shall be considered a material breach of this Agreement.



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<PAGE>


17.     Employee agrees that in Employee's position as Senior Vice President
        Finance, Employee has been made privy to certain confidential
        information, proprietary property and trade secrets of the Company and
        that disclosure or use by Employee of such information, property or
        trade secrets would damage the Company. Employee agrees that he will
        hold in confidence and will not, without the Company's prior written
        permission, use, disclose or disseminate (or act so as to cause the use,
        disclosure or dissemination of) any such confidential information,
        property or trade secrets. The obligations set forth in this provision
        shall not apply to any confidential information, property or trade
        secrets, which have become generally known to the public through no act
        or limitation upon the Employee. A breach of this provision shall be
        considered a material breach of this Agreement.

18.     Employee covenants and agrees that through July 31, 2004, Employee will
        not directly or indirectly, solicit, hire or engage on behalf of
        Employee or any other person or entity, any person known to Employee to
        be a current (as of the date of the signing of this Agreement and/or as
        of the time of such solicitation or hiring) employee or representative
        of the Company. Employee further agrees that he will not, directly or
        indirectly, during such period intentionally suggest, assist or
        influence the engagement or hiring by any other person or entity of any
        person known to Employee to be a currrent (as of the date of the signing
        of this Agreement and/or as of the time of such solicitation or hiring)
        employee or representative of the Company, nor will Employee directly or
        indirectly intentionally encourage or induce any person or entity or any
        person that is known to Employee to be a current (as of the date of the
        signing of this Agreement and/or as of the time of such solicitation or
        hiring) employee, distributor, source, supplier, customer or contractor
        of the Company to sever his, her or its relationship with the Company or
        intentionally do anything else which would be adverse in any material or
        substantial respect to the interests of the Company. A breach of this
        provision shall be considered a material breach of this Agreement.

19.     Employee covenants and agrees that through July 31, 2004, Employee will
        not engage in Competition with the Company or any Subsidiary.
        "Competition" shall mean engaging in any activity for a Competitor of
        the Company whether as an employee, consultant, principal, agent,




                                      -6-
<PAGE>

        officer, director, partner, shareholder (except as a less than one
        percent shareholder of a publicly traded company) or otherwise.
        "Competitor" shall mean (a) Payless Shoe Source, Wal-Mart, Kmart,
        Kohl's, Footlocker (including but not limited to Kid's Footlocker, Lady
        Footlocker and Footlocker.com) Finish Line, Genesco, Sports Authority,
        Shoe Carnival, Shoe Department, Designer Shoe Warehouse, Brown Shoe,
        Famous Footwear, Target, Sears and J.C. Penney (and any successor or
        successors thereto) and (b) any e-commerce or catalog business which
        sells Discount, Value /Moderate Priced or Athletic footwear. If the
        Employee commences employment or becomes a consultant, principal, agent,
        officer, director, partner or shareholder of any entity that is not a
        Competitor at the time the Employee initially becomes employed or
        becomes a consultant, principal, agent, officer, director, partner or
        shareholder of the entity, future activities of the entity shall not
        result in a violation of this provision unless (x) such activities were
        contemplated at the time the Employee initially became employed or
        becomes a consultant, principal, agent, officer, director, partner or
        shareholder of the entity (and the contemplation of such activities was
        known to the Employee) or (y) the Employee commences directly or
        indirectly overseeing or managing the activities which are competitive
        with the activities of the Company or Subsidiary. The Employee shall not
        be deemed directly or indirectly overseeing or managing the activities
        which are competitive with the activities of the Company or Subsidiary
        so long as he does not regularly participate in discussions with regard
        to the competing business. A breach of this provision shall be
        considered a material breach of this Agreement.

20.     Employee covenants and agrees that Employee will direct all prospective
        employer inquiries to Mark Morrison, Senior Vice President Human
        Resources of Footstar at One Crosfield Avenue, West Nyack, NY 10994

21.     Employee agrees that in the event Employee materially breaches or
        violates any provision of this Agreement then the Company, in addition
        to any other rights or remedies it may have, shall have no obligation to
        make any further payments otherwise due Employee pursuant to this
        Agreement and the Company shall be entitled to recover from Employee any
        sums paid or expenses incurred (including but not limited to reasonable
        attorneys in enforcing the agreement) by the Company on behalf of the
        Employee pursuant to this Agreement without reinstatement of any claim
        or demand Employee has settled through this Agreement.



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<PAGE>


22.     Nothing contained in this Agreement, or the fact the parties have signed
        the Agreement and exchanged the consideration provided hereunder, should
        be construed to be an admission of liability of wrongdoing on the part
        of either party. Moreover, neither this Agreement or anything herein
        shall be admissible in any proceedings as evidence of, or an admission
        by, the Company of any violation of any federal, state or local laws, or
        of their own policies or procedures. This Agreement shall not be
        admissible in any forum except to secure enforcement of its terms and
        conditions, or as required by law.

23.     No waiver of any breach of any term or conditions of this Agreement
        shall be or shall be construed to be a waiver of any other breach of
        this Agreement. No waiver shall be binding under this Agreement unless
        in writing and signed by the party waiving such breach.

24.     This Agreement shall be construed according to and governed by the laws
        of the State of New York and all disputes governing this Agreement shall
        be brought in a court of competent jurisdiction in the State of New
        York.

25.     If any of the provisions, terms, clauses or waivers or releases of
        claims or rights contained in this Agreement are declared illegal,
        unenforceable, or ineffective in a legal forum, all other provisions,
        terms, clauses and waivers and releases of claims and rights contained
        in the Agreement shall remain valid and binding upon both parties, and
        the Court shall have the power to modify the invalid and unenforceable
        provisions in a manner which most closely fulfills the intent and terms
        of this Agreement as herein set forth.

26.     This Agreement may not be changed, altered and/or modified except by a
        writing signed by Employee and the Company.

27.     The parties agree that this Agreement may be executed in counterparts,
        each of which shall be deemed to constitute an executed original.

28.     In the event it shall be determined that there is ambiguity contained in
        this Agreement, said ambiguities shall not be construed against any
        party hereto as a result of such party's preparation of this Agreement,
        but shall be construed in favor or against either of the parties hereto
        in light of all the facts, circumstances and intentions of the parties
        at the time this Agreement goes into effect.



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<PAGE>


29.     Employee acknowledges that Employee has been provided with, and has read
        a copy of the Agreement. Employee further acknowledges that Employee has
        had a reasonable period of time to examine the terms and conditions
        contained in this Agreement and has been advised to consult with an
        attorney before signing this Agreement. Employee further acknowledges
        that Employee has executed this Agreement freely and voluntarily,
        without fraud, duress or undue influence of any kind or nature
        whatsoever.

30.     Notwithstanding anything to the contrary contained in this Agreement
        Employee shall have the right to revoke this Agreement for a period of
        seven (7) days following execution of the Agreement by both parties. It
        is agreed and understood that this Agreement will not become effective
        until the expiration of the seven (7) day period. In the event Employee
        elects to revoke this Agreement, upon revocation, this Agreement shall
        be deemed null and void and Employee shall not receive payment
        hereunder. Revocation should be made by providing notice to the Company
        in accordance with Paragraph 31 below, which notice must be received by
        FOOTSTAR no later than the close of business on the seventh (7th) day
        after the date upon which the Agreement is executed by both parties.

31.     All notices or other communications shall be deemed to be given if
        delivered by hand, sent via overnight delivery (for which a receipt is
        obtained), or mailed (certified or registered mail), with postage
        prepaid as follows:

         TO EMPLOYEE: ___________________, or to such other person and/or place
         as Employee may designate in writing to the Company. TO COMPANY: One
         Crosfield Avenue, West Nyack, NY 10994 Attn: Senior Vice President
         Human Resources, or such other persons and/places as the Company may
         designate in writing to Employee.

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


                           (INTENTIONALLY LEFT BLANK)
EMPLOYEE ACKNOWLEDGES AND AGREES THAT EMPLOYEE HAS READ AND UNDERSTANDS THIS
AGREEMENT, AND THAT EMPLOYEE HAS SIGNED THIS AGREEMENT VOLUNTARILY FOR THE
PURPOSES OF RECEIVING ADDITIONAL BENEFITS FROM THE COMPANY BEYOND THOSE PROVIDED
BY COMPANY POLICY.



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<PAGE>


         IN WITNESS WHEREOF, the parties hereto have executed this Agreement
consisting of [9] pages including this signature page.

FOOTSTAR:                                            EMPLOYEE:


By:      STEPHEN R. WILSON                           By: THOMAS BAUMLIN
           -----------------                         --------------
         Stephen R. Wilson                           Thomas Baumlin

         Executive Vice President & CFO


         Sworn and subscribed                        Sworn and subscribed
         before me on this                           before me on this
         11  day of FEBRUARY , 2003                31ST  day of  JANUARY__, 2003


            TRACY PEPLOWSKI                           SUSAN M. KOTOFF
            -----------------                          ----------------

         Notary Public                                Notary Public

         My Commission Expires:  12/10/05            My Commission Expires:
                                                     JULY 3, 2007



By:        MARK G. MORRISON
           -----------------

         Mark G. Morrison
         Senior Vice President Human Resources
         Footstar

         Sworn and subscribed
         before me on this

            11    day of __FEB.___, 2003

            TRACY PEPLOWSKI
            -------------------

         Notary Public

         My Commission Expires:  12/10/05

         TRACY PEPLOWSKI
     Notary Public, State of New York
         No. 01PE6067335
     Qualified in Rockland County
     Commission Expires  12/10/2005






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