SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 10-Q





(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended May 30, 2009

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from
 to

Commission File number 0-20184





The Finish Line, Inc.

(Exact name of registrant as specified in its charter)







|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Indiana                                                        |  | 35-1537210                             
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer identification number)



|                                                  |  |           
|------------------------------------------------- |  | ----------
|3308 North Mitthoeffer Road Indianapolis, Indiana |  | 46235     
|(Address of principal executive offices)          |  | (zip code)

317-899-1022

(Registrants telephone number, including area code)



(Former name, former address and former fiscal year, if changed since last report.)





Indicate by check mark whether
Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and
(2) has been subject to such filing requirements for the past 90 days.    Yes  x    No   ̈

Indicate by check mark whether registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes   ̈    No   ̈

Indicate by check mark whether
the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting
company in Rule 12b-2 of the Securities Exchange Act of 1934.



Large accelerated filer   ̈

Accelerated filer  xNon-accelerated filer   ̈ (Do not check if a smaller reporting company)

Smaller reporting company   ̈


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2
of the Act).    Yes   ̈    No  x

Shares of common stock outstanding at July 2, 2009:



|        |  |           
|------- |  | ----------
|Class A |  | 51,391,785
|Class B |  | 3,545,702 











---

PART 1. FINANCIAL INFORMATION



|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------

THE FINISH LINE, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands)



|                                  |  |             |         |             |   |                  |  |   |        
|--------------------------------- |  | ----------- | ------- | ----------- | - | ---------------- |  | - | -------
|                                  |  | May 30,2009 |         | May 31,2008 |   | February 28,2009
|                                  |  | (unaudited) |         | (unaudited) |   |                 
|ASSETS                            |  |             |         |             |   |                  |  |   |        
|CURRENT ASSETS:                   |  |             |         |             |   |                  |  |   |        
|Cash and cash equivalents         |  | $           | 118,959 |             | $ | 39,992           |  | $ | 100,962
|Marketable securities             |  |             |        |             |   |                 |  |   | 14,913 
|Accounts receivable, net          |  |             | 2,454   |             |   | 4,420            |  |   | 4,930  
|Merchandise inventories, net      |  |             | 241,571 |             |   | 281,217          |  |   | 239,409
|Income taxes receivable           |  |             | 8,240   |             |   | 35,811           |  |   | 8,492  
|Other                             |  |             | 5,521   |             |   | 15,383           |  |   | 18,369 
|                                  |  |             |         |             |   |                  |  |   |        
|Total current assets              |  |             | 376,745 |             |   | 376,823          |  |   | 387,075
|                                  |  |             |        
|PROPERTY AND EQUIPMENT:           |  |             |         |             |   |                  |  |   |        
|Land                              |  |             | 1,557   |             |   | 1,557            |  |   | 1,557  
|Building                          |  |             | 41,847  |             |   | 41,435           |  |   | 41,843 
|Leasehold improvements            |  |             | 249,269 |             |   | 275,085          |  |   | 250,031
|Furniture, fixtures and equipment |  |             | 110,684 |             |   | 114,542          |  |   | 110,415
|Construction in progress          |  |             | 650     |             |   | 2,604            |  |   | 1,589  
|                                  |  |             |         |             |   |                  |  |   |        
|                                  |  |             | 404,007 |             |   | 435,223          |  |   | 405,435
|Less accumulated depreciation     |  |             | 237,011 |             |   | 222,283          |  |   | 232,316
|                                  |  |             |         |             |   |                  |  |   |        
|                                  |  |             | 166,996 |             |   | 212,940          |  |   | 173,119
|                                  |  |             |        
|Deferred income taxes             |  |             | 37,943  |             |   | 30,951           |  |   | 37,290 
|Goodwill                          |  |             |        |             |   | 5,964            |  |   |       
|Other assets, net                 |  |             | 1,632   |             |   | 7,703            |  |   | 1,249  
|                                  |  |             |         |             |   |                  |  |   |        
|Total assets                      |  | $           | 583,316 |             | $ | 634,381          |  | $ | 598,733
|                                  |  |             |         |             |   |                  |  |   |        

See accompanying notes.



2



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THE FINISH LINE, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands)



|                                                                                                      |  |             |         |   |             |   |         |                  |  |   |         |  
|----------------------------------------------------------------------------------------------------- |  | ----------- | ------- | - | ----------- | - | ------- | ---------------- |  | - | ------- | -
|                                                                                                      |  | May 30,2009 |         |   | May 31,2008 |   |         | February 28,2009 | 
|                                                                                                      |  | (unaudited) |         |   | (unaudited) |   |         |                  | 
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                  |  |             |         |   |             |   |         |                  |  |   |         |  
|CURRENT LIABILITIES:                                                                                  |  |             |         |   |             |   |         |                  |  |   |         |  
|Accounts payable                                                                                      |  | $           | 54,653  |   |             | $ | 83,006  |                  |  | $ | 64,415  |  
|Terminated merger-related liabilities                                                                 |  |             |        |   |             |   | 269     |                  |  |   |        |  
|Employee compensation                                                                                 |  |             | 11,308  |   |             |   | 12,533  |                  |  |   | 12,599  |  
|Accrued property and sales tax                                                                        |  |             | 6,679   |   |             |   | 7,640   |                  |  |   | 7,722   |  
|Deferred income taxes                                                                                 |  |             | 7,209   |   |             |   | 19,182  |                  |  |   | 7,213   |  
|Other liabilities and accrued expenses                                                                |  |             | 15,514  |   |             |   | 14,804  |                  |  |   | 15,889  |  
|                                                                                                      |  |             |         |   |             |   |         |                  |  |   |         |  
|Total current liabilities                                                                             |  |             | 95,363  |   |             |   | 137,434 |                  |  |   | 107,838 |  
|                                                                                                      |  |             |        
|Deferred credits from landlords                                                                       |  |             | 49,546  |   |             |   | 58,208  |                  |  |   | 51,939  |  
|Other long-term liabilities                                                                           |  |             | 14,877  |   |             |   | 15,819  |                  |  |   | 14,562  |  
|                                                                                                      |  |             |        
|SHAREHOLDERS EQUITY:                                                                                 |  |             |         |   |             |   |         |                  |  |   |         |  
|Preferred stock, $.01 par value; 1,000 shares authorized; none issued                                 |  |             |        |   |             |   |        |                  |  |   |        |  
|Common stock, $.01 par value                                                                          |  |             |         |   |             |   |         |                  |  |   |         |  
|Class A:                                                                                              |  |             |         |   |             |   |         |                  |  |   |         |  
|Shares authorized100,000                                                                             |  |             |         |   |             |   |         |                  |  |   |         |  
|Shares issued(May 30, 2009  55,764; May 31, 2008  54,168; February 28, 2009  55,296)              |  |             |         |   |             |   |         |                  |  |   |         |  
|                                                                                                      |  |             |        
|Shares outstanding(May 30, 2009  50,667; May 31, 2008  48,750; February 28, 2009 
50,025)         |  |             | 558     |   |             |   | 542     |                  |  |   | 553     |  
|                                                                                                      |  |             |        
|Class B:                                                                                              |  |             |         |   |             |   |         |                  |  |   |         |  
|Shares authorized10,000                                                                              |  |             |         |   |             |   |         |                  |  |   |         |  
|Shares issued and outstanding(May 30, 2009  3,546; May 31, 2008  5,141; February 28, 2009  4,013) |  |             | 35      |   |             |   | 52      |                  |  |   | 40      |  
|Additional paid-in capital                                                                            |  |             | 187,303 |   |             |   | 183,765 |                  |  |   | 186,655 |  
|Retained earnings                                                                                     |  |             | 281,501 |   |             |   | 285,803 |                  |  |   | 283,757 |  
|Treasury stock(May 30, 2009  5,097; May 31, 2008  5,418; February 28, 2009  5,271)                |  |             | (45,867 | ) |             |   | (47,242 | )                |  |   | (46,611 | )
|                                                                                                      |  |             |         |   |             |   |         |                  |  |   |         |  
|Total shareholders equity                                                                            |  |             | 423,530 |   |             |   | 422,920 |                  |  |   | 424,394 |  
|                                                                                                      |  |             |         |   |             |   |         |                  |  |   |         |  
|Total liabilities and shareholders equity                                                            |  | $           | 583,316 |   |             | $ | 634,381 |                  |  | $ | 598,733 |  
|                                                                                                      |  |             |         |   |             |   |         |                  |  |   |         |  

See accompanying notes.



3



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THE FINISH LINE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)



|                                                                |  |                      |         |   |             |   |        
|--------------------------------------------------------------- |  | -------------------- | ------- | - | ----------- | - | -------
|                                                                |  | Thirteen Weeks Ended
|                                                                |  | May 30,2009          |         |   | May 31,2008
|Net sales                                                       |  | $                    | 267,229 |   |             | $ | 287,939
|Cost of sales (including occupancy costs)                       |  |                      | 190,171 |   |             |   | 204,812
|                                                                |  |                      |         |   |             |   |        
|Gross profit                                                    |  |                      | 77,058  |   |             |   | 83,127 
|Selling, general and administrative expenses                    |  |                      | 77,983  |   |             |   | 81,427 
|                                                                |  |                      |         |   |             |   |        
|Operating (loss) income                                         |  |                      | (925    | ) |             |   | 1,700  
|Interest income, net                                            |  |                      | 104     |   |             |   | 255    
|                                                                |  |                      |         |   |             |   |        
|(Loss) income from continuing operations before income taxes    |  |                      | (821    | ) |             |   | 1,955  
|Income tax (benefit) expense                                    |  |                      | (215    | ) |             |   | 1,090  
|                                                                |  |                      |         |   |             |   |        
|(Loss) income from continuing operations                        |  |                      | (606    | ) |             |   | 865    
|(Loss) income from discontinued operations, net of income taxes |  |                      | (2      | ) |             |   | 3      
|                                                                |  |                      |         |   |             |   |        
|Net (loss) income                                               |  | $                    | (608    | ) |             | $ | 868    
|                                                                |  |                      |         |   |             |   |        
|(Loss) income per basic share:                                  |  |                      |         |   |             |   |        
|(Loss) income from continuing operations                        |  | $                    | (0.01   | ) |             | $ | 0.02   
|(Loss) income from discontinued operations                      |  |                      |        |   |             |   |       
|                                                                |  |                      |         |   |             |   |        
|Net (loss) income                                               |  | $                    | (0.01   | ) |             | $ | 0.02   
|                                                                |  |                      |         |   |             |   |        
|Basic weighted average shares                                   |  |                      | 54,153  |   |             |   | 53,523 
|                                                                |  |                      |         |   |             |   |        
|(Loss) income per diluted share:                                |  |                      |         |   |             |   |        
|(Loss) income from continuing operations                        |  | $                    | (0.01   | ) |             | $ | 0.02   
|(Loss) income from discontinued operations                      |  |                      |        |   |             |   |       
|                                                                |  |                      |         |   |             |   |        
|Net (loss) income                                               |  | $                    | (0.01   | ) |             | $ | 0.02   
|                                                                |  |                      |         |   |             |   |        
|Diluted weighted average shares                                 |  |                      | 54,153  |   |             |   | 53,895 
|                                                                |  |                      |         |   |             |   |        
|Dividends declared per share                                    |  | $                    | 0.03    |   |             | $ |       
|                                                                |  |                      |         |   |             |   |        

See accompanying notes.



4



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THE FINISH LINE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)(Unaudited)



|                                                                                                   |  |                      |         |   |             |   |         |  
|-------------------------------------------------------------------------------------------------- |  | -------------------- | ------- | - | ----------- | - | ------- | -
|                                                                                                   |  | Thirteen Weeks Ended |        
|                                                                                                   |  | May 30,2009          |         |   | May 31,2008 |  
|OPERATING ACTIVITIES:                                                                              |  |                      |         |   |             |   |         |  
|Net (loss) income                                                                                  |  | $                    | (608    | ) |             | $ | 868     |  
|Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: |  |                      |         |   |             |   |         |  
|Depreciation and amortization                                                                      |  |                      | 8,147   |   |             |   | 9,677   |  
|Deferred income taxes                                                                              |  |                      | (657    | ) |             |   | 34,915  |  
|Share-based compensation                                                                           |  |                      | 944     |   |             |   | 1,082   |  
|Loss (Gain) on disposal of property and equipment                                                  |  |                      | 292     |   |             |   | (101    | )
|Excess tax benefits from share-based compensation                                                  |  |                      | (56     | ) |             |   |        |  
|Changes in operating assets and liabilities:                                                       |  |                      |         |   |             |   |         |  
|Accounts receivable, net                                                                           |  |                      | 2,476   |   |             |   | 3,326   |  
|Merchandise inventories, net                                                                       |  |                      | (2,162  | ) |             |   | (12,884 | )
|Other current assets                                                                               |  |                      | 12,848  |   |             |   | 452     |  
|Accounts payable                                                                                   |  |                      | (9,762  | ) |             |   | 19,238  |  
|Employee compensation                                                                              |  |                      | (1,291  | ) |             |   | 2,374   |  
|Accrued income taxes payable/receivable                                                            |  |                      | 141     |   |             |   | (37,233 | )
|Terminated merger-related liabilities                                                              |  |                      |        |   |             |   | (46,860 | )
|Other liabilities and accrued expenses                                                             |  |                      | (1,412  | ) |             |   | (1,821  | )
|Deferred credits from landlords                                                                    |  |                      | (2,393  | ) |             |   | (1,434  | )
|                                                                                                   |  |                      |         |   |             |   |         |  
|Net cash provide by (used in) operating activities                                                 |  |                      | 6,507   |   |             |   | (28,401 | )
|                                                                                                   |  |                     
|INVESTING ACTIVITIES:                                                                              |  |                      |         |   |             |   |         |  
|Additions to property and equipment                                                                |  |                      | (2,295  | ) |             |   | (5,096  | )
|Proceeds from disposals of property and equipment                                                  |  |                      | 19      |   |             |   | 484     |  
|Proceeds from sale of marketable securities                                                        |  |                      | 14,913  |   |             |   |        |  
|                                                                                                   |  |                      |         |   |             |   |         |  
|Net cash provided by (used in) investing activities                                                |  |                      | 12,637  |   |             |   | (4,612  | )
|                                                                                                   |  |                     
|FINANCING ACTIVITIES:                                                                              |  |                      |         |   |             |   |         |  
|Proceeds from short-term borrowings                                                                |  |                      |        |   |             |   | 5,000   |  
|Repayments on short-term borrowings                                                                |  |                      |        |   |             |   | (5,000  | )
|Dividends paid to shareholders                                                                     |  |                      | (1,645  | ) |             |   |        |  
|Proceeds from issuance of common stock                                                             |  |                      | 442     |   |             |   | 104     |  
|Excess tax benefits from share-based compensation                                                  |  |                      | 56      |   |             |   |        |  
|                                                                                                   |  |                      |         |   |             |   |         |  
|Net cash (used in) provided by financing activities                                                |  |                      | (1,147  | ) |             |   | 104     |  
|Net increase (decrease) in cash and cash equivalents                                               |  |                      | 17,997  |   |             |   | (32,909 | )
|Cash and cash equivalents at beginning of period                                                   |  |                      | 100,962 |   |             |   | 72,901  |  
|                                                                                                   |  |                      |         |   |             |   |         |  
|Cash and cash equivalents at end of period                                                         |  | $                    | 118,959 |   |             | $ | 39,992  |  
|                                                                                                   |  |                      |         |   |             |   |         |  

See accompanying notes.



5



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THE FINISH LINE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)



|1. | Summary of Significant Accounting Policies
|-- | ------------------------------------------

Basis of
Presentation

The accompanying unaudited consolidated financial statements of The Finish Line, Inc., along with its wholly-owned
subsidiaries, (collectively, the Company) have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. Preparation of the financial statements requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary
for a fair presentation, have been included.

The Company has experienced, and expects to continue to experience, significant variability
in sales and net (loss) income from reporting period to reporting period. Therefore, the results of the interim periods presented herein are not necessarily indicative of the results to be expected for any other interim period or the full year.

These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Companys
Annual Report on Form 10-K for the year ended February 28, 2009 (fiscal 2009).



|2. | Terminated Merger
|-- | -----------------

On June 17, 2007, the
Company entered into an Agreement and Plan of Merger (the Merger Agreement) with Genesco Inc. (Genesco) under which the Company agreed to acquire all of the outstanding common shares of Genesco for $54.50 per share in cash
(the Merger), subject to certain conditions.

UBS Loan Finance LLC and UBS Securities LLC (collectively, UBS)
committed to provide financing for the Merger and ongoing working capital requirements of the combined company of up to $1.8 billion through a combination of a Senior Secured Revolving Credit Facility, a Senior Secured Term Loan and a Senior
Unsecured Bridge Facility (the UBS Financing).

On September 19, 2007, the Company received a communication from UBS
indicating its intention to defer further work on the closing documents for the Merger pending its analysis of Genescos financial condition and performance. The same day, Genesco delivered a letter to the Company demanding that the Company
immediately consummate the Merger. On September 21, 2007, Genesco filed a lawsuit in the Chancery Court in Nashville, Tennessee seeking an order of specific performance requiring the Company to take all steps necessary to consummate the Merger
contemplated by the Merger Agreement. The Company filed an answer, counterclaim and third-party claim for declaratory judgment in connection with this action seeking, among other things, a declaratory judgment that a Company Material Adverse Effect
had occurred under the Merger Agreement. UBS intervened as a defendant in the Nashville, Tennessee case and filed an answer to Genescos complaint. On November 13, 2007, Genesco amended its complaint to add an alternative claim for
damages. On November 15, 2007, the Company filed an answer to Genescos amended complaint asserting that a Company Material Adverse Effect had occurred under the Merger Agreement and asserting a counterclaim against Genesco for intentional
or negligent misrepresentation. On that day, UBS filed an answer to Genescos amended complaint and a counterclaim asserting fraud against Genesco.

On November 14, 2007, the Company was named as a defendant, along with Genesco, in a complaint for declaratory relief filed by UBS in the United States District Court for the Southern District of New York. UBS
was seeking a declaration in the New York federal district court action that its commitment letter for the UBS Financing (the Commitment), which expired on April 30, 2008 (after an extension agreed to by UBS), was void and/or may
properly be terminated by UBS because the Company would not be able to provide, prior to the expiration of the Commitment, a valid solvency certificate attesting to the solvency of the combined Finish Line-Genesco entity resulting from the Merger.



6



---

The trial of the issues in the Chancery Court in Nashville concluded on December 18, 2007, and the
Chancery Court issued its opinion on December 27, 2007. The Chancery Court held that the Company was required to close the Merger with Genesco and use its reasonable best efforts to obtain the financing required to do so (i.e., either the UBS
Financing which was the subject of the New York action, or alternative financing on terms not materially less favorable in the aggregate than the UBS Financing). Although the Chancery Court held that the deterioration in Genescos financial
condition and operating results constituted a material adverse effect (MAE), it also found that Genescos decline in performance was due to general economic conditions and was not disproportionate to its peers. As a result, the MAE
fell within one of the MAE carve-outs in the Merger Agreement and the Company was, therefore, not excused from completing the Merger based on Genescos decline in financial condition and operating results. The Chancery Court reserved for
determination by the United States District Court for the Southern District of New York whether the merged entity would be insolvent.

On
March 3, 2008, the Company entered into a Settlement Agreement with UBS and Genesco relating to the actions filed by UBS in the United States District Court for the Southern District of New York and filed by Genesco in the Chancery Court for
the State of Tennessee (the Litigation). The parties agreed to settle the Litigation and to terminate the Merger Agreement and Commitment. As consideration for these agreements, the Company and UBS agreed to make a cash payment in the
amount of $175,000,000 (of which the Company agreed to pay $39,000,000 and UBS agreed to pay $136,000,000). The Company also agreed to issue 6,518,971 shares of the Companys Class A Common Stock (the Shares) to Genesco.
Pursuant to the Settlement Agreement, the Company paid the $39,000,000 cash payment and delivered the Shares to Genesco on March 7, 2008. The Company filed a registration statement relating to the Shares with the Securities and Exchange
Commission on April 4, 2008, which was declared effective on April 28, 2008. Genesco distributed the Shares to Genesco shareholders on June 13, 2008. The Company does not expect to incur any significant ongoing costs relating to this
matter.



|3. | Discontinued Operations of Paiva
|-- | --------------------------------

On
August 27, 2007, the Board of Directors of the Company approved managements recommendation to proceed with the closure of the Companys Paiva stores. The decision to take this action resulted from a thorough assessment and analysis,
which revealed the concept was not demonstrating the potential necessary to deliver an acceptable long-term return on investment. The Company closed all 15 Paiva stores and online business during the thirteen weeks ended December 1, 2007. The
results of operations of Paiva have been classified in discontinued operations for all periods presented. The financial results of the Paiva operations, which are included in discontinued operations in the accompanying Consolidated Statements of
Operations, were as follows (in thousands):



|                                                              |  |                      |    |   |             |   |  
|------------------------------------------------------------- |  | -------------------- | -- | - | ----------- | - | -
|                                                              |  | Thirteen weeks ended
|                                                              |  | May 30,2009          |    |   | May 31,2008
|                                                              |  | (unaudited)         
|Net sales                                                     |  | $                    |   |   |             | $ | 
|                                                              |  |                      |    |   |             |   |  
|(Loss) income from discontinued operations                    |  | $                    | (4 | ) |             | $ | 5
|Income tax (benefit) expense                                  |  |                      | (2 | ) |             |   | 2
|                                                              |  |                      |    |   |             |   |  
|(Loss) income from discontinued operations, net of income tax |  | $                    | (2 | ) |             | $ | 3
|                                                              |  |                      |    |   |             |   |  

Based on the Companys current estimates as of May 30, 2009, future lease payments,
including estimated lease termination payments, and repayment of unamortized construction allowances are expected to result in a total cash outlay of approximately $387,000 and $102,000, respectively. Unamortized construction allowances are included
within Deferred credits from landlords. The Company anticipates that all cash payments will occur within the next 7 months.

The balance and net activity for the estimated future lease payments, including estimated lease termination payments, which are included within Other liabilities and accrued expenses, are as follows (in thousands):



|                             |  |               |    
|---------------------------- |  | ------------- | ---
|                             |  | Lease Reserve
|                             |  | (unaudited)  
|Balance at February 28, 2009 |  | $             | 387
|Provision                    |  |               |   
|Cash payments                |  |               |   
|                             |  |               |    
|Balance at May 30, 2009      |  | $             | 387
|                             |  |               |    



7



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|4. | Fair Value Measurements
|-- | -----------------------

On March 2, 2008, the
Company adopted SFAS No. 157, Fair Value Measurements (FAS 157). FAS 157 provides a single definition of fair value and a common framework for measuring fair value as well as new disclosure requirements for fair value
measurements used in financial statements. Under FAS 157, fair value is determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants exclusive of
any transaction costs. FAS 157 also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques as follows:



|         |  |                                                                                                                                   
|-------- |  | ----------------------------------------------------------------------------------------------------------------------------------
|Level 1: |  | Observable inputs such as quoted prices in active markets;                                                                        
|         | 
|Level 2: |  | Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and                        
|         | 
|Level 3: |  | Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The Company has cash equivalents of short-term money market funds backed by U.S. Treasury and
Government securities. The primary objective of our short-term investment activity is to preserve our capital for the purpose of funding operations and we do not enter into short-term investments for trading or speculative purposes. The fair values
are based on unadjusted quoted market prices for the funds in active markets with sufficient volume and frequency (Level 1). The adoption of FAS 157 did not have an impact on the Companys results of operations, financial condition or
liquidity.

On March 1, 2009, the Company adopted FAS No. 157, for all non-financial assets and non-financial liabilities
recognized or disclosed in the financial statements on a nonrecurring basis. As of May 30, 2009, the Company had no non-financial assets or non-financial liabilities requiring measurement at fair value.



|5. | Recent Accounting Pronouncements
|-- | --------------------------------

In May 2008, the
FASB staff revisited Emerging Issues Task Force (EITF) issue No. 03-6 and issued FASB Staff Position (FSP) No. EITF 03-6-1, Determining Whether Instruments Granted in Shared-Based Payment Transactions are
Participating Securities. FSP EITF 03-6-01 requires unvested share-based payments that entitle employees and nonemployee directors to receive nonrefundable dividends to also be considered participating securities, as defined in EITF 03-6.
This FSP is effective for fiscal years beginning after December 15, 2008 and interim periods within those years with early adoption prohibited. FSP EITF 03-6-1 was effective March 1, 2009 and did not have a significant effect on the
Companys earnings per share calculations for any of the periods presented.

In April 2009, the FASB issued FSP No. FAS 157-4,
Determining Fair Value When the Volume and Level of Activity for the Asset or the Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly, (FSP No. 157-4). FSP No. FAS 157-4 amends
Statement No. 157 to provide additional guidance on (i) estimating fair value when the volume and level of activity for an asset or liability have significantly decreased in relation to normal market activity for the asset or liability,
and (ii) circumstances that may indicate that a transaction is not orderly. FSP No. FAS 157-4 also requires additional disclosures about fair value measurements in interim and annual reporting periods. FSP No. FAS 157-4 is effective for interim
and annual reporting periods ending after June 15, 2009. The Company does not expect the adoption of FSP No. FAS 157-4 to have a material effect on its consolidated financial statements.

In April 2009, the FASB issued FSP No. FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments. FSP No. FAS
115-2 and FAS 124-2 amends the other-than-temporary impairment guidance for debt securities to make the guidance more operational and to improve the presentation and disclosure of other-than-temporary impairments on debt and equity securities in the
financial statements. This guidance does not amend existing recognition and measurement guidance related to other-than-temporary impairments of equity securities. The provisions of FSP No. FAS 115-2 and FAS 124-2 are effective for interim and annual
reporting periods ending after June 15, 2009. The Company does not expect the adoption of FSP No. FAS 115-2 and FAS 124-2 to have a material effect on its consolidated financial statements.

In April 2009, the FASB issued FSP No. FAS 107-1 and APB No. 28-1, Interim Disclosures about Fair Value of Financial Instruments which
amends SFAS No. 107, Disclosures about Fair Value of Financial Instruments, to require disclosures about fair value of financial instruments for interim reporting periods of publicly traded companies, as well as in annual financial statements.
This FSP also amends APB Opinion No. 28,Interim Financial Reporting,to require those disclosures in summarized financial information at interim reporting periods. FSP FAS 107-1 and APB 28-1 are effective for interim reporting
periods ending after June 15, 2009. The Company is currently assessing the effect that the adoption of FSP No. FAS 107-1 and APB No. 28-1 will have on its financial statement disclosures.



8



---

In May 2009, the FASB issued Statement of Financial Accounting Standards No. 165, Subsequent
Events (FAS 165). FAS 165 established general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued. FAS 165 will be effective in the second quarter
of fiscal 2010. We do not expect the adoption of FAS 165 to have a material effect on our financial position, cash flows, or results of operations.



|6. | Common Stock
|-- | ------------

Pursuant to the Settlement Agreement
entered into with UBS and Genesco (see Note 2), the Company issued 6,518,971 shares of the Companys Class A Common Stock (the Shares) to Genesco on March 7, 2008. The Company filed a registration statement relating to the
Shares with the Securities and Exchange Commission on April 4, 2008, which was declared effective on April 28, 2008. Genesco distributed the Shares to Genesco shareholders on June 13, 2008.

On July 22, 2004, the Companys Board of Directors instituted a quarterly cash dividend program of $0.025 per share of Class A and Class B
Common Stock. In light of the Merger Agreement entered into with Genesco on June 17, 2007, the Company decided to suspend future quarterly dividends beginning with the thirteen weeks ended September 1, 2007 until further notice. On
July 17, 2008, the Companys Board of Directors reinstated the quarterly cash dividend program with a 20% increase to $0.03 per share of Class A and Class B common stock. The Company declared dividends of $1,648,000 during the
thirteen weeks ended May 30, 2009. The cash dividend of $1,648,000 was paid on June 15, 2009 to shareholders of record on May 29, 2009 and was accrued at May 30, 2009 in Other liabilities and accrued expenses.

On July 17, 2008, the Companys Board of Directors authorized a new stock repurchase program to repurchase up to 5,000,000
shares of the Companys Class A common stock outstanding through December 31, 2011. The Company believes that adoption of the repurchase program could be a viable use of excess cash. Such purchase, if any, will occur from time to
time, as market conditions warrant and as the Company deems appropriate when judged against other alternative uses of cash. The Company did not purchase any shares under the stock repurchase program during the thirteen weeks ended May 30, 2009.



|7. | Subsequent Event
|-- | ----------------

On June 21, 2009, the
Company and its wholly owned subsidiary The Finish Line Man Alive, Inc. (Man Alive) entered into a definitive agreement (the Purchase Agreement) with Man Alive Acquisitions, LLC (MA) an entity controlled by Jimmy
Khezrie, the owner and operator of Jimmy Jazz stores, under which MA assumed certain assets and liabilities of Man Alive. Both the Company and over eighty separate entities which are affiliated with MA have joined the Agreement to guaranty the
obligations of Man Alive and MA under the Agreement, respectively. The transaction closed on July 3, 2009 with an effective date of July 4, 2009.

Under the terms of the Purchase Agreement, MA assumed certain assets and liabilities of Man Alive (as specified in the Purchase Agreement), including the 75 retail stores (under both the Man Alive and Decibel names),
the leasehold interests and lease liabilities of Man Alive, as well as intellectual property, including the Man Alive and Decibel trademarks and trade names. The Company paid approximately $7.7 million in cash with $5.7 million paid at closing
and the remaining $2.0 million to be paid in 12 equal monthly installments with the first payment made on the first day of the first month following closing. Including the $7.7 million, the Company expects to take a pre-tax charge of $20 to $25
million.

Man Alives net assets primarily consisted of property and equipment of $6.8 million, $6.8 million and $23.8 million and
inventory of $5.9 million, $4.3 million and $10.0 million as of May 30, 2009, February 28, 2009 and May 31, 2008, respectively. Net sales were $8.1 million for the thirteen weeks ended May 30, 2009 compared to $14.9 million
for the thirteen weeks ended May 31, 2008. Loss from continuing operations before income taxes was $3.9 million for the thirteen weeks ended May 30, 2009 compared to a loss from continuing operations before income taxes of $2.4 million for
the thirteen weeks ended May 31, 2008.

The disposition of Man Alive will be accounted for as a discontinued operation in the second
quarter ending August 29, 2009.



9



---

|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

This quarterly report on Form 10-Q may contain certain statements that we believe are, or may be considered to be, forward-looking
statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally can be identified by use of statements that include phrases such
as believe, expect, anticipate, intend, plan, foresee, may, will, estimates, potential, continue or other similar
words or phrases. Similarly, statements that describe our objectives, plans or goals also are forward-looking statements. All of these forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ
materially from those contemplated by the relevant forward-looking statement. The principal risk factors that could cause actual performance and future actions to differ materially from the forward-looking statements include, but are not limited to,
the failure of MA to discharge its post-closing liabilities under the leases it is assuming from Man Alive, which could cause actual results of the Company to differ materially since such event could result in certain liabilities remaining with the
Company; fluctuations in oil prices causing changes in gasoline and energy prices, resulting in changes in consumer spending and utility and product costs; product demand and market acceptance risks; the effect of economic conditions including
conditions resulting from the current turmoil in the financial services industry and depressed demand in the housing market; the effect of competitive products and pricing; the availability of products; management of growth; and the other risks
detailed in the Companys Securities and Exchange Commission filings. Readers are urged to consider these factors carefully in evaluating the forward-looking statements. The forward-looking statements included in this Form 10-Q are made only as
of the date of this report and we undertake no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances.

General

The following discussion and analysis should be read in conjunction with Managements Discussion and Analysis
of Financial Condition, including Critical Accounting Policies, included in the Companys Annual Report on Form 10-K for the year ended February 28, 2009 (fiscal 2009). Unless otherwise noted, all amounts reflect the results of the
Companys continuing operations and therefore Paiva store information and results have been excluded from the following information.

The following table sets forth store and square feet information of the Company by brand for each of the following periods:



|                    |  |                      |   |  |             |  
|------------------- |  | -------------------- | - |  | ----------- | -
|                    |  | Thirteen weeks ended |  
|Number of Stores:   |  | May 30,2009          |   |  | May 31,2008 |  
|Finish Line         |  |                      |   |  |             |  
|Beginning of period |  | 689                  |   |  | 697         |  
|Opened              |  |                     |   |  | 4           |  
|Closed              |  | (5                   | ) |  | (1          | )
|                    |  |                      |   |  |             |  
|End of period       |  | 684                  |   |  | 700         |  
|                    |  |                      |   |  |             |  
|Man Alive           |  |                      |   |  |             |  
|Beginning of period |  | 85                   |   |  | 94          |  
|Opened              |  |                     |   |  |            |  
|Closed              |  | (9                   | ) |  |            |  
|                    |  |                      |   |  |             |  
|End of period       |  | 76                   |   |  | 94          |  
|                    |  |                      |   |  |             |  
|Total               |  |                      |   |  |             |  
|Beginning of period |  | 774                  |   |  | 791         |  
|Opened              |  |                     |   |  | 4           |  
|Closed              |  | (14                  | ) |  | (1          | )
|                    |  |                      |   |  |             |  
|End of period       |  | 760                  |   |  | 794         |  
|                    |  |                      |   |  |             |  



|                               |  |             |  |            
|------------------------------ |  | ----------- |  | -----------
|                               |  | May 30,2009 |  | May 31,2008
|Square feet information as of: |  |             |  |            
|Finish Line                    |  |             |  |            
|Square feet                    |  | 3,698,519   |  | 3,848,242  
|Average store size             |  | 5,407       |  | 5,497      
|Man Alive                      |  |             |  |            
|Square feet                    |  | 262,448     |  | 326,407    
|Average store size             |  | 3,453       |  | 3,472      
|Total                          |  |             |  |            
|Square feet                    |  | 3,960,967   |  | 4,174,649  



10



---

Results of Operations

The following table sets forth net sales of the Company by major category for each of the following periods (in thousands):



|          |  |                      |         |  |              |   |  |   |         |  |     |  
|--------- |  | -------------------- | ------- |  | ------------ | - |  | - | ------- |  | --- | -
|          |  | Thirteen Weeks Ended |        
|Category  |  | May 30, 2009         |         |  | May 31, 2008 |  
|          |  | (Unaudited)          |         |  | (Unaudited)  |  
|Footwear  |  | $                    | 226,891 |  | 85           | % |  | $ | 236,211 |  | 82  | %
|Softgoods |  |                      | 40,338  |  | 15           | % |  |   | 51,728  |  | 18  | %
|          |  |                      |         |  |              |   |  |   |         |  |     |  
|Total     |  | $                    | 267,229 |  | 100          | % |  | $ | 287,939 |  | 100 | %
|          |  |                      |         |  |              |   |  |   |         |  |     |  

The following table and subsequent discussion sets forth operating data of the Company as a
percentage of net sales for the periods indicated below.



|                                                                |  |                      |    |  |             |  
|--------------------------------------------------------------- |  | -------------------- | -- |  | ----------- | -
|                                                                |  | Thirteen Weeks Ended |   
|                                                                |  | May 30,2009          |    |  | May 31,2008 |  
|                                                                |  | (Unaudited)          |   
|Net sales                                                       |  | 100.0                | %  |  | 100.0       | %
|Cost of sales (including occupancy costs)                       |  | 71.1                 |    |  | 71.1        |  
|                                                                |  |                      |    |  |             |  
|Gross profit                                                    |  | 28.9                 |    |  | 28.9        |  
|Selling, general and administrative expenses                    |  | 29.2                 |    |  | 28.3        |  
|                                                                |  |                      |    |  |             |  
|Operating (loss) income                                         |  | (0.3                 | )  |  | 0.6         |  
|Interest income, net                                            |  |                     |    |  | 0.1         |  
|                                                                |  |                      |    |  |             |  
|(Loss) income from continuing operations before income taxes    |  | (0.3                 | )  |  | 0.7         |  
|Income tax (benefit) expense                                    |  | (0.1                 | )  |  | 0.4         |  
|                                                                |  |                      |    |  |             |  
|(Loss) income from continuing operations                        |  | (0.2                 | )  |  | 0.3         |  
|(Loss) income from discontinued operations, net of income taxes |  |                     |    |  |            |  
|                                                                |  |                      |    |  |             |  
|Net (loss) income                                               |  | (0.2                 | )% |  | 0.3         | %
|                                                                |  |                      |    |  |             |  



11



---

THIRTEEN WEEKS ENDED MAY 30, 2009 COMPARED TO THIRTEEN WEEKS ENDED MAY 31, 2008

Consolidated net sales decreased 7.2% to $267.2 million for the thirteen weeks ended May 30, 2009 from $287.9 million for the thirteen weeks ended
May 31, 2008. The decrease was attributable to a comparable store net sales decrease of 5.5% for the thirteen weeks ended May 30, 2009 and reduced sales of $7.2 million from 39 closed stores along with down time and reduced square footage
related to remodeled/relocated stores, partially offset by a $1.3 million increase from 5 new stores opened subsequent to May 31, 2008 and a $0.3 million increase in net sales from existing stores that were open only part of the thirteen weeks
ended May 31, 2008. The 5.5% decrease in comparable store net sales was attributable to a 3.9% decrease for Finish Line stores and a 39.1% decrease for Man Alive stores. Comparable footwear net sales for the thirteen weeks ended May 30,
2009 decreased 2.6% while comparable softgoods net sales decreased 19.3% for the comparable period. The 19.3% decrease in comparable softgoods net sales was attributable to a 12.0% decrease in Finish Line comparable softgoods net sales and a 39.1%
decrease in Man Alive comparable softgoods net sales. The 12.0% decrease in softgoods at Finish Line was primarily the result of managements plan to reduce softgoods inventory levels and focus on increasing inventory turns and the return on
investment, which the Company achieved during the thirteen weeks ended May 30, 2009. The 39.1% decrease in comparable softgoods net sales at Man Alive was primarily a result of the Companys significant adjustment from an exclusive focus
on urban apparel toward a focus on relative metropolitan street wear and a continued decrease in consumer spending due to the recent economic slowdown.

Consolidated gross profit for the thirteen weeks ended May 30, 2009 was $77.1 million, a decrease of $6.0 million (7.3%) from $83.1 million for the thirteen weeks ended May 31, 2008. Gross profit was
28.9% for both periods. Within gross profit, occupancy costs increased 0.3% as a percentage of net sales offset by a 0.2% decrease in inventory shrink and a 0.1% increase in product margin.

Consolidated selling, general and administrative expenses decreased by $3.4 million (4.2%) to $78.0 million (29.2% of net sales) for the thirteen
weeks ended May 30, 2009 compared to $81.4 million (28.3% of net sales) for the thirteen weeks ended May 31, 2008. The 0.9% increase as a percentage of net sales is due to deleveraging from the 7.2% decrease in net sales.

Net interest income was $0.1 million for the thirteen-week period ended May 30, 2009 compared to $0.3 million for the thirteen weeks ended
May 30, 2008. The decrease of $0.2 million was due to lower earned interest rates as invested balances were higher during the thirteen weeks ended May 30, 2009 compared to the thirteen weeks ended May 31, 2008.

The Companys income tax benefit was $0.2 million for the thirteen weeks ended May 30, 2009 compared to income tax expense of $1.1 million for
the thirteen weeks ended May 31, 2008. The $1.3 million change was due to loss from continuing operations before income taxes of $0.8 million for the thirteen weeks ended May 30, 2009 compared to income from continuing operations before
income taxes of $2.0 million for the thirteen weeks ended May 31, 2008. The effective tax rates for both periods were impacted by state tax expense recorded related to income tax contingencies pursuant to Financial Accounting Standards Board
Interpretation No. 48, Accounting for Income Taxes and certain state tax rate changes.

Loss from continuing operations
for the thirteen weeks ended May 30, 2009 was $0.6 million compared to income from continuing operations of $0.9 million for the thirteen weeks ended May 31, 2008. Loss from continuing operations per diluted share was $(0.01) for the
thirteen weeks ended May 30, 2009 compared to income from continuing operations per diluted share of $0.02 for the thirteen weeks ended May 31, 2008. Diluted weighted average shares outstanding were 54.2 million and 53.9 million
for the thirteen weeks ended May 30, 2009 and May 31, 2008, respectively.



12



---

Liquidity and Capital Resources

The Company had net cash of $6.5 million provided by its operating activities during the thirteen weeks ended May 30, 2009 as compared to $28.4 million used in operating activities during the thirteen weeks ended
May 31, 2008. Included in the $28.4 million for the thirteen weeks ended May 31, 2008 was $39.0 million paid for the cash portion of the Settlement Agreement (see Note 2 to the Consolidated Financial Statements). At May 30, 2009, the
Company had cash and cash equivalents of $119.0 million and no interest bearing debt. Cash equivalents are primarily invested in short-term money market funds backed by U.S. Treasury and Government securities with daily liquidity.

Consolidated merchandise inventories were $241.6 million at May 30, 2009 compared to $239.4 million at February 28, 2009 and $281.2 million at
May 31, 2008. On a comparable per square foot basis, consolidated merchandise inventories decreased 9.5% at May 30, 2009 compared to May 31, 2008, and were 2.9% higher than at February 28, 2009. The 9.5% decrease per square foot
compared to May 31, 2008 is a result of managements plan to reduce inventory levels and increase inventory turns.

The
Companys working capital was $281.4 million at May 30, 2009, which was a $2.2 million increase from $279.2 million at February 28, 2009.

The Company had net cash provided by investing activities of $12.6 million for the thirteen weeks ended May 30, 2009 compared to net cash used in investing activities of $4.6 million for the thirteen weeks ended
May 31, 2008. The $12.6 million provided in the thirteen weeks ended May 30, 2009 was from $14.9 million in proceeds from the sale of marketable securities, partially offset by $2.3 million primarily used for remodeling existing stores.

For the year ending February 27, 2010, the Company intends to open approximately 4 to 6 Finish Line stores (none
opened during the thirteen weeks ended May 30, 2009), as well as remodel approximately 5 to 8 existing Finish Line stores (3 remodeled during the thirteen weeks ended May 30, 2009). In addition, the Company has various other corporate
capital and technology projects. The Company expects capital expenditures for the current fiscal year to approximate $13.0 to $16.0 million. Management believes that cash on hand, operating cash flow and the Companys existing $75.0 million
unsecured committed Credit Agreement (the Credit Agreement), which expires on February 25, 2010, will provide sufficient capital to satisfy the Companys working capital requirements in the foreseeable future. The Credit
Agreement also provides that, under certain circumstances, the Company may increase the aggregate principal amount of revolving loans by up to an additional $75.0 million. The Company is in the process of renewing the Credit Agreement and expects to
be completed in the 4thquarter.

Pursuant to the Settlement Agreement entered into with UBS and Genesco (see Note 2 to the Consolidated Financial Statements), the Company issued
6,518,971 shares of the Companys Class A Common Stock (the Shares) to Genesco on March 7, 2008. The Company filed a registration statement relating to the Shares with the Securities and Exchange Commission on
April 4, 2008, which was declared effective on April 28, 2008. Genesco distributed the Shares to Genesco shareholders on June 13, 2008.

On July 17, 2008, the Companys Board of Directors authorized a new stock repurchase program to repurchase up to 5,000,000 shares of the Companys outstanding Class A common stock. Under the stock
repurchase program, the Company may purchase shares through December 31, 2011. The Company did not repurchase any shares under the new stock program during the thirteen weeks ended May 30, 2009.

On July 22, 2004, the Companys Board of Directors instituted a quarterly cash dividend program of $0.025 per share of Class A and Class B
Common Stock. In light of the Merger Agreement entered into with Genesco on June 17, 2007, the Company decided to suspend future quarterly dividends beginning with the thirteen weeks ended September 1, 2007 until further notice. On
July 17, 2008, the Companys Board of Directors reinstated the quarterly cash dividend program with a 20% increase to $0.03 per share of Class A and Class B common stock. The Company declared dividends of $1.6 million during the
thirteen weeks ended May 30, 2009. As of May 30, 2009, dividends declared but not paid of $1.6 million were accrued in Other liabilities and accrued expenses on the Consolidated Balance Sheets. Further declarations of
dividends, if any, remain at the discretion of the Companys Board of Directors.

Subsequent Events

On June 21, 2009, the Company and its wholly owned subsidiary The Finish Line Man Alive, Inc. (Man Alive) entered into a definitive
agreement (the Purchase Agreement) with Man Alive Acquisitions, LLC (MA) an entity controlled by Jimmy Khezrie, the owner and operator of Jimmy Jazz stores, under which MA assumed certain assets and liabilities of Man
Alive. Both the Company and over eighty separate entities which are affiliated with MA have joined the Agreement to guaranty the obligations of Man Alive and MA under the Agreement, respectively. The transaction closed on July 3, 2009 with
an effective date of July 4, 2009.



13



---

Under the terms of the Purchase Agreement, MA assumed certain assets and liabilities of Man Alive (as
specified in the Purchase Agreement), including the 75 retail stores (under both the Man Alive and Decibel names), the leasehold interests and lease liabilities of Man Alive, as well as intellectual property, including the Man Alive and Decibel
trademarks and trade names. The Company paid approximately $7.7 million in cash with $5.7 million paid at closing and the remaining $2.0 million to be paid in 12 equal monthly installments with the first payment made on the first day of the
first month following closing. Including the $7.7 million, the Company expects to take a pre-tax charge of $20 to $25 million.

Man
Alives net assets primarily consisted of property and equipment of $6.8 million, $6.8 million and $23.8 million and inventory of $5.9 million, $4.3 million and $10.0 million as of May 30, 2009, February 28, 2009 and May 31,
2008, respectively. Net sales were $8.1 million for the thirteen weeks ended May 30, 2009 compared to $14.9 million for the thirteen weeks ended May 31, 2008. Loss from continuing operations before income taxes was $3.9 million for the
thirteen weeks ended May 30, 2009 compared to a loss from continuing operations before income taxes of $2.4 million for the thirteen weeks ended May 31, 2008.

The disposition of Man Alive will be accounted for as a discontinued operation in the second quarter ending August 29, 2009.

Contractual Obligations

The Companys contractual obligations primarily consist of long-term debt, operating leases,
and purchase orders for merchandise inventory. For the thirteen weeks ended May 30, 2009, there were no significant changes to the Companys contractual obligations from those identified in the Companys Annual Report on Form 10-K for
the fiscal year ended February 28, 2009, other than those which occur in the normal course of business (primarily changes in the Companys merchandise inventory related to purchase obligations, which fluctuate throughout the year as a
result of the seasonal nature of the Companys operations, and reduction of operating leases due to store closings).

Critical Accounting Policies
and Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management
to adopt accounting policies related to estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period, as
well as the related disclosure of contingent assets and liabilities at the date of the financial statements. On an ongoing basis, management evaluates its accounting policies, estimates and judgments, including those related to inventories,
longlived assets and contingencies. Management bases its estimates and judgments on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.

There have been no material changes to the critical accounting policies and estimates disclosed in the Companys Annual Report on
Form 10-K for the fiscal year ended February 28, 2009.



|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|------- | ----------------------------------------------------------

For a discussion of the Companys market risk associated with interest rates as of February 28, 2009 see Quantitative and Qualitative Disclosures about Market Risk in Item 7A of Part II of the Companys
Annual Report on Form 10-K for the fiscal year ended February 28, 2009. For the thirteen weeks ended May 30, 2009, there has been no significant change in related market risk factors.



|ITEM 4. | CONTROLS AND PROCEDURES
|------- | -----------------------

Disclosure Controls and
Procedures. With the participation of our Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended (the Exchange Act)), as of the end of the period covered by this report. Based upon such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end
of such period, our disclosure controls and procedures were effective in ensuring that (i) information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the Securities Exchange Commissions rules and forms and (ii) information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated
and communicated to the Companys management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting. There have not been any changes in our internal control over financial reporting (as such term is
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



14



---

PART IIOTHER INFORMATION



|ITEM 1: | LEGAL PROCEEDINGS
|------- | -----------------

The Company is subject from time
to time, to certain legal proceedings and claims in the ordinary course of conducting its business. Although it is not possible to predict with certainty the eventual outcome of any litigation, in the opinion of management, the Companys legal
proceedings are not expected to have a material adverse effect on the Companys financial position or results of operations.



|ITEM 1A: | RISK FACTORS
|-------- | ------------

Risk factors that affect the
Companys business and financial results are discussed in Item 1A: Risk Factors in the Companys Annual Report on Form 10-K for the fiscal year ended February 28, 2009. There has been no significant change to identified
risk factors for the thirteen weeks ended May 30, 2009.



|ITEM 2: | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|------- | -----------------------------------------------------------

None.



|ITEM 3: | DEFAULTS UPON SENIOR SECURITIES
|------- | -------------------------------

None.



|ITEM 4: | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
|------- | ---------------------------------------------------

None.



|ITEM 5: | OTHER INFORMATION
|------- | -----------------

None.



|ITEM 6: | EXHIBITS
|------- | --------

(a) Exhibits



|     |  |                                                                                                                                                                                                                                                                                                                                                    
|---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.1  |  | Asset Purchase Agreement, dated June 21, 2009 by and among The Finish Line Man Alive, Inc., The Finish Line, Inc., Man Alive Acquisitions, LLC, and the other entities listed therein
(incorporated by reference to Exhibit 2.1 of the Registrants Current Report on Form 8-K filed with the Securities and Exchange Commission on June 22, 2009).
|     | 
|3.1  |  | Bylaws of The Finish Line, Inc., Amended as of April 23, 2009 (incorporated by reference to Exhibit 3.2 of the Registrants Current Report on Form 8-K filed with the Securities and
Exchange Commission on April 28, 2009).                                                                                                                       
|     | 
|10.1 |  | Employment Agreement of Edward W. Wilhelm, dated as of March 30, 2009 (incorporated by reference to Exhibit 10.1 of the Registrants Current Report on Form 8-K/A filed with the
Securities and Exchange Commission on April 14, 2009).                                                                                                            
|     | 
|31.1 |  | Certification of Chief Executive Officer Pursuant to Exchange Act Rule 13a-14(a) and 15d-14(a), as amended                                                                                                                                                                                                                                         
|     | 
|31.2 |  | Certification of Chief Financial Officer Pursuant to Exchange Act Rule 13a14(a) and 15d-14(a), as amended                                                                                                                                                                                                                                         
|     | 
|32   |  | Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                             



15



---

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



|                   |  |  |  |                                                                   
|------------------ |  |  |  | ------------------------------------------------------------------
|                   |  |  |  | THE FINISH LINE, INC.                                             
|                   |  | 
|Date: July 8, 2009 |  |  |  | By: /s/ Edward W. Wilhelm                                         
|                   |  |  |  | Edward W. Wilhelm Executive Vice President-Chief
Financial Officer



16



---

Exhibit Index



|               |  |                                                                                                                                                                                                                                                                                                                                                    
|-------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit Number |  | Description                                                                                                                                                                                                                                                                                                                                        
|2.1            |  | Asset Purchase Agreement, dated June 21, 2009 by and among The Finish Line Man Alive, Inc., The Finish Line, Inc., Man Alive Acquisitions, LLC, and the other entities listed therein
(incorporated by reference to Exhibit 2.1 of the Registrants Current Report on Form 8-K filed with the Securities and Exchange Commission on June 22, 2009).
|               | 
|3.1            |  | Bylaws of The Finish Line, Inc., Amended as of April 23, 2009 (incorporated by reference to Exhibit 3.2 of the Registrants Current Report on Form 8-K filed with the Securities and
Exchange Commission on April 28, 2009).                                                                                                                       
|               | 
|10.1           |  | Employment Agreement of Edward W. Wilhelm, dated as of March 30, 2009 (incorporated by reference to Exhibit 10.1 of the Registrants Current Report on Form 8-K/A filed with the
Securities and Exchange Commission on April 14, 2009).                                                                                                            
|               | 
|31.1           |  | Certification of Chief Executive Officer Pursuant to Exchange Act Rule 13a-14(a) and 15d- 14(a), as amended                                                                                                                                                                                                                                        
|               | 
|31.2           |  | Certification of Chief Financial Officer Pursuant to Exchange Act Rule 13a-14(a) and 15d- 14(a), as amended                                                                                                                                                                                                                                        
|               | 
|32             |  | Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                             



17