
<PAGE>


                           EAGLE HARDWARE & GARDEN, INC.

                            EMPLOYEE STOCK PURCHASE PLAN

1.   DEFINITIONS

     "Code" means the Internal Revenue Code of 1986, as amended.

     "Common Stock" means common stock, no par value, of the Company.

     "Company" means Eagle Hardware & Garden, Inc., a Washington corporation and
     any Participating Subsidiaries.

     "Compensation" means regular straight time earnings plus compensation for
     overtime, incentive bonuses and other additional compensation, except to
     the extent that any such item is specifically excluded by the Plan
     Administrator.

     "ESPP" means this Eagle Hardware & Garden, Inc. Employee Stock Purchase
     Plan.

     "Fair Market Value" of the Common Stock as of any day means the closing
     price (rounded to the next highest cent in the case of fractions of a cent)
     of the Common Stock as reported on such day or, if such day is not a
     trading day of the Nasdaq Stock Market, the next trading day as reported by
     the Nasdaq Stock Market.  If the Common Stock of the Company is not
     admitted to trading on any of the aforesaid dates for which closing prices
     of the stock are to be determined, then reference shall be made to the fair
     market value of the stock on that date, as determined on such basis as
     shall be established or specified for the purpose by the Plan
     Administrator.

     "Participant" means an employee of the Company or a Participating
     Subsidiary who is regularly scheduled to work a minimum of fifteen (15)
     hours per week, who has met the eligibility requirements in Section 7 and
     has filed an Enrollment Agreement and such other documents as are required
     under Section 8.

     "Participating Subsidiary" means any corporation which is a "subsidiary
     corporation" of the Company within the meaning of Code Section 424(e) and
     is designated as a participant in the Plan by the Plan Administrator.

     "Plan Administrator" means the Board of Directors of the Company, or any
     committee established pursuant to Section 4 to administer the ESPP.

     "Purchase Period" means a six-month period commencing on January 1 or July
     1.

     "Purchase Date" means the last business day of a Purchase Period.


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2.   PURPOSE

     The purpose of this ESPP is to enable Participants to acquire a larger
personal proprietary interest in the Company, and to encourage Participants to
remain in the employ of the Company and have a personal interest in the success
of the Company.  This ESPP is intended to constitute an "employee stock purchase
plan" as defined in Code Section 423, and shall be interpreted and administered
to further that intent.

     This ESPP is intended to provide Common Stock for investment and not for
resale.  The Company does not, however, intend to restrict or influence the
conduct of any Participant's affairs.  A Participant, therefore, may sell Common
Stock that is purchased under this ESPP at any time, subject to compliance with
any applicable federal or state tax and securities laws.  THE EMPLOYEE ASSUMES
THE RISK OF ANY MARKET FLUCTUATIONS IN THE PRICE OF THE SHARES.

3.   GOVERNMENTAL REGULATIONS

     The Company's obligation to sell and deliver shares of Common Stock under
the ESPP is subject to the approval of any governmental authority required in
connection with the authorization, issuance or sale of such shares.

4.   ADMINISTRATION

     Primary authority for administration of the Plan is held by the Board of
Directors, but the Board of Directors, in its discretion, may establish a
committee composed of members of the Board of Directors or employees of the
Company to administer the Plan which shall have such of the power and authority
vested in the Board of Directors under the Plan as the Board of Directors may
delegate to it, including the power and authority to interpret any provision of
the Plan.  The Board of Directors or any committee established pursuant to this
Section 4 is referred to herein as the "Plan Administrator."  It is the
intention of the Company that the ESPP and the administration hereof comply in
all respects with Section 16(b) of the Securities Exchange Act of 1934 and
Section 423(b) of the Code.

5.   STOCK SUBJECT TO THE ESPP

     There are reserved for issuance under the ESPP 1,200,000 shares of Common
Stock which may be purchased by Participants pursuant to the ESPP, subject to
adjustment as provided in Section 17.


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6.   PURCHASE PERIODS

     This ESPP will be administered based on semiannual Purchase Periods
commencing January 1 or July 1.  The first Purchase Period will begin on July 1,
1998 and end on December 31, 1998.

7.   ELIGIBILITY

     Any employee who has completed ninety (90) days employment and who is
employed on the date his or her participation is to begin shall be eligible to
participate in Purchase Periods beginning after such ninety (90) day period.

     For purposes of participation in the ESPP, a person on leave of absence
shall be deemed to be an employee for the first ninety (90) days of such leave
of absence and such person's employment shall be deemed to have terminated at
the close of business on the 90th day of such leave of absence unless such
person shall have returned to regular full-time or part-time employment (as the
case may be) prior to the close of business on such 90th day.  Termination by
the Company of a person's leave of absence, other than termination of such leave
of absence on return to full time or part time employment, shall terminate a
person's employment for all purposes of the ESPP and shall terminate such
person's participation in the ESPP and right to purchase shares of stock
pursuant to the ESPP.

8.   PARTICIPATION

     An eligible employee may become a Participant by completing, signing and
filing an Enrollment Agreement authorizing payroll deductions and any other
necessary papers with the Company at least ten (10) days prior to the
commencement of the particular Purchase Period in which he or she wishes to
participate.  Participation in one Purchase Period under the Plan shall neither
limit, nor require, participation in any other Purchase Period.

9.   PAYROLL DEDUCTIONS

     At the time a Participant files his or her Enrollment Agreement, he or she
may elect to have from 1% to 15% (in whole percentage points) of his or her
Compensation deducted and applied to the purchase of shares of Common Stock
pursuant to this ESPP.  An amount equal to the elected percentage of the
Participant's Compensation will be deducted on each regular pay day falling
within the Purchase Period.  All amounts will be deducted from a Participant's
Compensation on an after-tax basis.  No interest will be paid on payroll
deductions accumulated under the ESPP.  A Participant may discontinue
participation or withdraw from the ESPP as provided in Section 12, but may not
alter the amount of his or her payroll deductions or make any other changes
during a Purchase Period.

     If a Participant goes on a leave of absence, such Participant shall have
the right, subject to the provisions of Section 7,  to elect:  (a) to withdraw
his or her accumulated payroll deductions


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pursuant to Section 12; (b) to discontinue payroll deductions but remain a
Participant in the ESPP during such leave of absence, or (c) remain a
Participant in the ESPP during such leave of absence, authorizing deductions to
be made from payments by the Company to the Participant during such leave of
absence and undertaking to make cash payments to the Company at the end of each
payroll period to the extent that amounts payable by the Company to such
Participant are insufficient to meet such Participant's authorized Plan
deductions.

10.   PURCHASE OF COMMON STOCK

     On the Purchase Date, a Participant's accumulated payroll deductions will,
subject to the limitations in Section 11 and the termination provisions of
Section 16, be applied toward the purchase of shares of Common Stock at a
purchase price equal to the lesser of:

     (a)  85% of the Fair Market Value of the Common Stock on the first business
          day of the Purchase Period; or

     (b)  85% of the Fair Market Value of the Common Stock on the Purchase Date,

in either event rounded to the nearest whole cent.

     Shares of Common Stock may be purchased under the ESPP only with a
Participant's accumulated payroll deductions.  Fractional shares cannot be
purchased.  The Company will return to the Participant any portion of a
Participant's accumulated payroll deductions not used for the purchase of Common
Stock at the end of a Purchase Period unless the Participant has advised the
Company otherwise by reexecuting an Enrollment Agreement before the commencement
of the succeeding Purchase Period to have the balance carried over to be applied
to the purchase of Common Stock in such Purchase Period; provided the
Participant is participating in the ESPP during that Purchase Period.

11.  LIMITATIONS ON SHARE PURCHASES

     During any Purchase Period the maximum number of shares of Common Stock
that may be purchased by a Participant may not exceed 1,000 shares.  During any
calendar year, the maximum value of the Common Stock that may be purchased by a
Participant under the ESPP is $25,000, said value to be determined on the basis
of the Fair Market Value of the Common Stock on the first business day of the
Purchase Period and in accordance with the requirements of Code
Section 423(b)(8).  The foregoing limitation is intended to and shall be
interpreted in such a manner as will comply with Code Section 423(b)(8).  In
addition, no Participant shall be permitted to subscribe for any shares under
the ESPP if such Participant, immediately after such subscription, owns shares
that account for (including all shares that may be purchased under outstanding
subscriptions under the ESPP and any other outstanding options to purchase
shares of Common Stock) five percent (5%) or more of the total combined voting
power or value of all classes of shares of the Company or its subsidiaries,
taking into account the stock ownership rules in Code Section 424(d).


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12.  WITHDRAWAL AND DISCONTINUANCE

     A Participant may withdraw from the ESPP, in whole but not in part, at any
time prior to the last business day of each offering by completing the
"discontinue and withdraw" section of an ESPP Change Notice and delivering the
ESPP Change Notice to the Company, in which event the Company will refund the
entire balance of his accumulated payroll deductions as soon as practicable
thereafter.

     To re-enter the ESPP, a Participant who has previously withdrawn must file
a new Enrollment Agreement in accordance with Section 8.  His re-entry into the
ESPP cannot, however, become effective before the beginning of the next Purchase
Period following his withdrawal.

     A Participant may elect to discontinue his payroll deductions during the
course of a particular Purchase Period, at any time prior to the last business
day preceding the final pay day during such Purchase Period, by completing the
"discontinue" section of an ESPP Change Notice and delivering the ESPP Change
Notice to the Company, and such election will not constitute a withdrawal for
purpose of this Section 12.  In the event that a Participant elects to
discontinue his payroll deductions pursuant to this Section 12, the Participant
will continue to participate in such Purchase Period and will be entitled to
purchase from the Company such number of full shares of Common Stock as set
forth in and in accordance with Section 10.

13.  ISSUANCE OF COMMON STOCK TO CUSTODIAL ACCOUNTS

     The shares of Common Stock purchased by a Participant will be issued
electronically by the Company's transfer agent to the Participant's custodial
account as soon as practicable after each Purchase Date.  Common Stock purchased
under the ESPP will be issued only in the name of the Participant (or, if his
authorization so designates, in the name of the Participant and another person
of legal age as joint tenants with rights of survivorship).  The custodial
account of Participants shall be maintained by a bank, broker-dealer or similar
custodian appointed by the Plan Administrator that has agreed to hold such
shares for the accounts of the respective Participants.  Fees and expenses of
the bank, broker-dealer or similar custodian shall be paid by the Company or
allocated among the respective Participants in such manner as the Plan
Administrator determines.  A Participant or his legal representative may sell
Common Stock from his custodial account at any time; however, any sale within
two (2) years of the first day of the Purchase Period and one (1) year of the
Purchase Date will be treated by the Company as a disqualifying disposition
under the Code and be reported on the Participant's tax Form W-2.

14.  WITHHOLDING TAXES

     In connection with the purchase of shares of Common Stock under the ESPP,
the Company (a) shall not issue a certificate for such shares until it has
received payment from the Participant of any required withholding tax in cash or
by the retention or acceptance upon delivery thereof by the Participant of
shares of Common Stock sufficient in Fair Market Value to


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cover the amount of such withholding tax and (b) shall have the right to retain
or sell without notice, or to demand surrender of, shares of Common Stock in
value sufficient to cover any withholding tax.  The Company shall have the right
to withhold from any payroll deductions made by the Participant under the ESPP
an amount equal to any required withholding tax.  In either case, the Company
shall make payment (or reimburse itself for payment made) to the appropriate
taxing authority of an amount in cash equal to the amount of such withholding
tax, remitting any balance to the Participant.  For purposes of this Section 14,
the value of shares of Common Stock so retained or surrendered shall be equal to
the Fair Market Value of such shares on the date that the amount of the
withholding tax is to be determined (the "Tax Date"), and the value of shares of
Common Stock so sold shall be the actual net sale price per share (after
deduction of commissions) received by the Company.  Notwithstanding the
foregoing, the Participant may elect, subject to approval by the Plan
Administrator, to satisfy the obligation to pay any withholding tax, in whole or
in part, by providing the Company with funds sufficient to enable the Company to
pay such withholding tax or by having the Company retain or accept upon delivery
thereof by the Participant shares of Common Stock sufficient in Fair Market
Value to cover the amount of such withholding tax.  Each election by a
Participant to have shares retained or to deliver shares for this purpose must
be in writing and made on or prior to the Tax Date.

15.  TRANSFERABILITY

     A Participant's rights under the ESPP, including rights to accumulated
payroll deductions, may not be pledged, assigned, encumbered or otherwise
transferred for any reason other than by will or the laws of descent and
distribution.  Any such attempt will be treated as an election by the
Participant to withdraw from the ESPP.

16.  TERMINATING EVENTS

     Upon (a) the dissolution or liquidation of the Company, (b) a merger or
other reorganization of the Company with one or more corporations as a result of
which the Company will not be a surviving corporation, (c) the sale of all or
substantially all of the assets of the Company or a material division of the
Company, (d) a sale or other transfer, pursuant to a tender offer or otherwise,
of more than fifty percent (50%) of the then outstanding shares of Common Stock
of the Company, (e) an acquisition by the Company resulting in an extraordinary
expansion of the Company's business or the addition of a material new line of
business, or (f) any exchange that is subject to this Section 16 (any of such
events is herein referred to as a "Terminating Event"), the Plan Administrator
may but shall not be required to:

          (a)  make provision for the continuation of the Participants' rights
     under the ESPP on such terms and conditions as the Plan Administrator
     determines to be appropriate and equitable, including where applicable, but
     not limited to, an arrangement for the substitution on an equitable basis,
     for each share of Common Stock that could otherwise be purchased at the end
     of the Purchase Period in progress at the time of the


                                         -6-
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     Terminating Event, of any consideration payable with respect to each then
     outstanding share of Common Stock in connection with the Terminating Event;
     or

          (b)  terminate all rights of Participants under the ESPP for such
     Purchase Period and --

               (i)  return to the Participants all of their payroll deductions
                    for such Purchase Period; and

               (ii) for each share of Common Stock, if any, that could otherwise
                    be purchased under the ESPP by a Participant at the end of
                    such Purchase Period (determined by assuming that payroll
                    deductions at the rate elected by the Participant were
                    continued to the end of the Purchase Period and used to
                    purchase shares based on the Fair Market Value of the Common
                    Stock on the first day of the Purchase Period) and with
                    respect to which (A) the purchase price at which such share
                    could be purchased (determined with reference only to the
                    Fair Market Value of the Common Stock on the first day of
                    the Purchase Period) is exceeded by (B) the Fair Market
                    Value on the date of the Terminating Event of a share of
                    Common Stock, as determined by the Plan Administrator, pay
                    to the Participant an amount equal to such excess.

     The Plan Administrator shall make all determinations necessary or advisable
in connection with Terminating Events, and its determinations shall, in the
absence of fraud or patent mistake, be conclusive and binding on all persons
with any interest in the ESPP.

17.  ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

     In the event of any changes in the outstanding stock of the Company by
reason of stock dividends, stock splits, recapitalizations, mergers,
consolidations, combinations or exchanges of shares, split-ups, split-offs,
spin-offs, liquidations or other similar changes in capitalization, or any
distribution to stockholders other than cash dividends, the Plan Administrator
shall make such adjustments, if any, in light of the change or distribution as
the Plan Administrator in its sole discretion shall determine to be appropriate
in the number and class of shares and the purchase prices of the Common Stock
which may be purchased by Participants during the current Purchase Period.  In
the event of any such change in the outstanding Common Stock of the Company, the
aggregate number and class of shares available under the ESPP and the maximum
number of shares which may be purchased and their purchase price shall be
appropriately adjusted by the Plan Administrator.

     Upon the happening of an event specified in this Section 17, the class and
aggregate number of shares available under the ESPP, as set forth in Section 5
shall be appropriately adjusted to reflect the event.  Notwithstanding the
foregoing, such adjustments shall be made only to the extent that the Plan
Administrator, based on advice of counsel for the Company,


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determines that such adjustments will not constitute a change requiring
shareholder approval under Code Section 423(b)(2).

18.  TERMINATION OF EMPLOYEE'S RIGHTS

     Subject to the provisions of Section 20, a Participant's rights under the
ESPP will terminate if he or she for any reason (including death, disability or
voluntary or involuntary termination of employment) ceases to be an employee of
the Company.  To the extent that the rights of a Participant terminate in
accordance with this Section 18, any of the Participant's accumulated payroll
deductions will be promptly returned to the Participant or in the case of the
Participant's death, to his or her beneficiary as provided in Section 19 below.
The ESPP does not, directly or indirectly, create any right for the benefit of
any employee or class of employees to preferentially purchase any Common Stock
under the ESPP, or create in any employee or class of employees any right with
respect to continuation of employment by the Company, and it shall not be deemed
to interfere in any way with the Company's right to terminate, or otherwise
modify, an employee's employment at any time.


19.  DESIGNATION OF BENEFICIARY

     A Participant may designate a beneficiary who is to receive any accumulated
payroll deductions upon the Participant's death.  Such designation may be
changed by the Participant at any time by completing the "beneficiary
designation" section of an ESPP Change Notice and delivering the ESPP Change
Notice to the Plan Administrator.  Upon the death of a Participant and upon
receipt by the Company of proof of identity, the Company shall deliver such
accumulated payroll deductions to such beneficiary.  In the event of the death
of a Participant and in the absence of a beneficiary validly designated under
the Plan who is living at the time of such Participant's death, the Company
shall deliver such accumulated payroll deductions to the executor or personal
representative of the Participant's estate or if no executor or personal
representative has been appointed (to the knowledge of the Company), the
Company, in its discretion, may deliver such accumulated payroll deductions to
the spouse or to any one or more dependents of the Participant as the Company
may designate.  No beneficiary shall, prior to the death of the Participant by
whom he or she has been designated, acquire any interest in the Participant's
accumulated payroll deductions.


20.  TERMINATION AND AMENDMENTS TO ESPP

     The ESPP may be terminated at any time by the Plan Administrator but,
except as provided in Section 16, such termination shall not affect the rights
of Participants under the ESPP for the Purchase Period in progress at the time
of termination.  The ESPP will terminate in


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any case when all or substantially all of the unissued shares of Common Stock
reserved for the purposes of the ESPP have been purchased.  If at any time
shares of Common Stock reserved for the purpose of the ESPP remain available for
purchase but not in sufficient number to satisfy all then unfilled purchase
requirements, the available shares shall be apportioned among Participants in
proportion to the respective amounts of their accumulated payroll deductions,
and the ESPP shall terminate.  Upon such termination or any other termination of
the ESPP, all accumulated payroll deductions not used to purchase shares of
Common Stock will be refunded to the Participants entitled thereto.  The ESPP
may be terminated, modified or amended by the shareholders of the Company.  The
Board of Directors of the Company may also terminate this ESPP, or modify or
amend the ESPP in such respects as it shall deem advisable in order to conform
to any change in any law or regulation applicable thereto, or in other respects;
however, to the extent required by applicable law or regulation, shareholder
approval will be required for any amendment which will (a) increase the total
number of shares which may be issued under the ESPP, (b) change the class of
persons eligible to purchase Common Stock under the ESPP, (c) materially
increase the benefits accruing to Participants under the ESPP, or (d) otherwise
require shareholder approval under any applicable law or regulation.

21.  INFORMATION TO PARTICIPANTS

     A Participant in the ESPP shall not have any rights as a shareholder of the
Company on account of shares of Common Stock that may be purchased under the
ESPP prior to the time such shares are actually purchased by and issued to the
Participant.  Notwithstanding the foregoing, the Company shall deliver to each
Participant under the ESPP who does not otherwise receive such materials (a) a
copy of the Company's annual financial statements, together with management's
discussion and analysis of financial condition and results of operations for the
fiscal year, and (b) a copy of all reports, proxy statements and other
communications distributed to the Company's security holders generally.

22.  APPROVAL OF SHAREHOLDERS

     The ESPP will become effective July 1, 1998; subject to approval by the
holders of a majority of the shares of the Company present or represented by
proxy at an annual meeting of the shareholders of the Company held after the
date on which the ESPP is adopted by the Board of Directors of the Company and
on or before July 1, 1999.  The ESPP shall also be subject to approval by the
shareholders of the Company in a manner that complies with Section 423(b)(2) of
the Code.  If the ESPP is not so approved, it shall not become effective, and
all payroll deductions of Participants accumulated under the ESPP will be
promptly returned to the Participants.

     Date Approved by Board of Directors:  ___________, ____.

     Date Approved by Shareholders: ___________, ____.


                                         -9-

<PAGE>

                               FIRST AMENDMENT TO THE 
                            EAGLE HARDWARE & GARDEN, INC.
                       EMPLOYEE STOCK OWNERSHIP TRUST AGREEMENT




     This Amendment, effective as of April 1, 1998, by and between EAGLE 
HARDWARE & GARDEN, INC., a corporation duly organized and existing under the 
laws of Washington (hereinafter the "Company") and STATE STREET BANK AND 
TRUST COMPANY, a Massachusetts trust company (hereinafter the "Trustee").

                                     WITNESSETH:

     WHEREAS, the Company has previously entered into a trust agreement (the
"Trust Agreement") with U.S. Bank of Washington, N.A. (the "Prior Trustee") to
serve as trustee of the Eagle Hardware & Garden, Inc. Employee Stock Ownership
Plan (hereinafter the "Plan"); and

     WHEREAS, the Company desires to remove the Prior Trustee and appoint the
Trustee as a successor trustee under the Trust Agreement and the Trustee desires
to accept such appointment; and

     WHEREAS, the parties wish to use all of the provisions of the Trust
Agreement with the Prior Trustee, unless specifically changed by this Amendment;

     NOW THEREFORE, the parties hereto hereby amend the Trust Agreement as
follows:

1.   All references in the Trust Agreement to the Trustee shall be read to 
mean State Street Bank and Trust Company, as the successor trustee to the 
Prior Trustee.

2.   Article IX. Section B. shall be deleted and replaced with the following:

     "This Trust Agreement shall be construed and governed in all respects in
     accordance with applicable federal law, and, to the extent not preempted by
     such federal law, in accordance with the laws of the Commonwealth of
Massachusetts."

<PAGE>

     IN WITNESS WHEREOF, the Company and the Trustee have caused this Amendment
to be executed as of the day and year first written above. 


                                   EAGLE HARDWARE & GARDEN, INC.
                                   By: [Illegible]
                                       ----------------------------
                                   Its: E.V.P. Admin.  EVP/CFO
                                        ---------------------------

                                   STATE STREET BANK AND TRUST COMPANY

                                   By:  Paul Schaetzl
                                      -----------------------------
                                   Its:      Vice President

