
<PAGE>

                          SECURITIES AND EXCHANGE COMMISSION
                               WASHINGTON, D.C. 20549

                                     FORM 10-K

[X]               ANNUAL REPORT PURSUANT TO SECTION 13 OR 15[d] OF 
                         THE SECURITIES EXCHANGE ACT OF 1934
                      FOR THE FISCAL YEAR ENDED JANUARY 30, 1998
                                         OR
[  ]            TRANSITION REPORT PURSUANT TO SECTION 13 OR 15[d] OF 
                         THE SECURITIES EXCHANGE ACT OF 1934

                           COMMISSION FILE NUMBER 0-19830
                                          
                           EAGLE HARDWARE & GARDEN, INC.
                         ----------------------------------
               (Exact name of registrant as specified in its charter)
                                          
                 WASHINGTON                          91-1465348
                ------------                        -------------
     (State or other jurisdiction of    (IRS Employer Identification No.)
     incorporation or organization)
     
                     981 POWELL AVENUE SW    RENTON, WA  98055
                   ----------------------------------------------
                      (Address of principal executive offices)
                                          
                                   (425) 227-5740
                                  ----------------
                (Registrant's telephone number, including area code)
                                          
            SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
                                        None
                                          
            SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
<TABLE>
<CAPTION>
 
     <S>                                             <C>
     TITLE OF EACH CLASS                             NAME OF EACH EXCHANGE ON WHICH REGISTERED
     Common Stock (symbol: "EAGL")                   The Nasdaq Stock Market    
     6.25% convertible subordinated
          debentures due 2001 (symbol: "EAGLG")      The Nasdaq Stock Market


</TABLE>
 

Indicate by check mark whether the 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 if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K. ( )

The aggregate market value of the Common Stock of the Registrant held by
nonaffiliates of the Registrant on April 1, 1998, was $454,715,326.  For the
purposes of this response, executive officers and directors are deemed to be the
affiliates of the Registrant and the holding by nonaffiliates was computed as
25,708,287 shares.

The Registrant had 29,072,106 shares of Common Stock, without par value,
outstanding at April 1, 1998.


Total number of pages, including cover page:__ Exhibit Index appears at page __.

                                          1
<PAGE>

     DOCUMENTS INCORPORATED BY REFERENCE

(1)  Portions of the Registrant's 1997 Annual Report to Shareholders are
incorporated by reference into Part II; and

(2)  Portions of the Registrant's definitive Proxy Statement to be filed with
the Securities and Exchange Commission in connection with its 1998 Annual
Meeting of Shareholders are incorporated by reference into Part III hereof.

                             FORWARD-LOOKING STATEMENTS

     Some of the information in this Annual Report, including anticipated store
openings, capital requirements and trends in the Company's markets, constitutes
forward-looking statements.  These statements are subject to a number of risks
and uncertainties that might cause actual results to differ materially from
stated expectations.  These risks include, among others, the highly competitive
environment in the retail home improvement industry, the effect of general
economic conditions and weather in the Company's markets and the Company's
ability to achieve its expansion plans and successfully manage its growth.  (See
Item 1 - Business - Risk Factors)

                                          
                                        PART I
ITEM 1 - BUSINESS - 

GENERAL

     Eagle Hardware & Garden, Inc. ("Eagle Hardware" or the "Company") is a
leading operator of customer-friendly home improvement centers in the western
United States. Since opening its first store in Spokane, Washington in
November 1990, the Company has grown to 32 stores with approximately 4.1 million
square feet of selling space.  Eagle Hardware stores generated average annual
sales per store of $32.5 million in 1997, the second highest in the industry.
The Company's stores average approximately 128,000 square feet and feature a
product assortment of over 65,000 stock keeping units ("SKUs"), significantly
more than the Company's principal competitors, while maintaining an average
in-stock position of over 98%. Since its inception, the Company has focused on
creating the best home improvement shopping experience for its customers by
combining the selection and value associated with traditional warehouse-format
home centers with the comfortable atmosphere and service orientation of
specialty retailers. 

     The Company has differentiated its stores from those of other warehouse
home improvement retailers by providing a bright, clean and well-organized
customer-friendly shopping environment and by offering "More of
Everything-Registered Trademark-," with one of the broadest and deepest
selections of brand name home improvement products available in the United
States. Through its highly trained sales associates, including Eagle Experts-TM-
and Eagle Service Specialists-TM-, the Company provides exceptional customer
service to both its target do-it-yourself customers, as well as professional
contractors. The Company believes the successful implementation of its business
strategy has made Eagle Hardware a more appealing destination for home
improvement shoppers, including female customers, who favor the
customer-oriented shopping environment of the Company's stores over the often
confusing atmosphere of traditional warehouse-format home centers.

INDUSTRY OVERVIEW

     According to industry publications, the do-it-yourself home improvement
industry in the United States generated aggregate revenues of approximately
$142.5 billion in 1997. Over the last 10 years, the industry has undergone
significant changes, with the warehouse-format home center retailers gaining
significant market share in a 

                                          2
<PAGE>

number of markets in the United States relative to traditional home center,
hardware and lumber yard operators, by offering lower prices and taking
advantage of economies created by larger sales volumes. Although the home
improvement industry remains fragmented, it has experienced increasing
consolidation during recent years, with the sales of the five largest operators
representing over 30% of the estimated overall market in 1997 as compared to 15%
of the overall market in 1991. The Company believes this trend will continue,
and that opportunities exist for service-oriented home improvement retailers to
benefit from this continuing consolidation.   

BUSINESS STRATEGY

     The Company's goal is to be the premier operator of customer-oriented home
improvement centers in the United States. To achieve this goal, Eagle Hardware
has developed and is implementing a business strategy designed to satisfy the
preferences expressed by its target do-it-yourself customers by combining
selection and value with exceptional customer service and convenience. The key
elements of the Company's strategy are as follows:

     CUSTOMER-FRIENDLY STORE ENVIRONMENT  The Company strives to create the best
     shopping experience by providing a customer-friendly store environment that
     is clean, attractive and "easy to shop," with bold signage, wide, brightly
     lit aisles and well-marked departments designed to help customers easily
     find desired merchandise categories. For ease of access, the Company's
     innovative Design Center is typically positioned centrally within the store
     and adjacent to 8,000 square feet of fully furnished and accessorized
     kitchen and bath displays to allow customers to view products in real-life
     settings. A tiled "racetrack" aisle encircles the Design Center and related
     departments for easy customer access to the other merchandise departments
     within the store. Seventeen to 26 cash registers are positioned at various
     places in each store to facilitate rapid check-out. These and other
     features provide Eagle Hardware customers with an enjoyable shopping
     experience in a specialty-store environment. 

     "MORE OF EVERYTHING -Registered Trademark-" MERCHANDISING PHILOSOPHY  Eagle
     Hardware offers one of the broadest and deepest selections of virtually
     every category of home improvement merchandise in the United States,
     providing one-stop shopping for its target do-it-yourself customers as well
     as professional contractors. In addition to serving the major project needs
     of its customers, the Company also targets "fix-it" repair and maintenance
     customers. The Company's home centers average approximately 128,000 square
     feet (excluding storage and exterior garden square footage) of retail floor
     space and the product selection of each Eagle Hardware home center consists
     of over 65,000 SKUs, considerably more than most hardware and home
     improvement stores. The Company's home centers also carry significantly
     more SKUs than its principal competitors, while maintaining an average
     in-stock position of over 98%. 

     EXCEPTIONAL SERVICE  To further enhance the Eagle Hardware shopping
     experience, the Company is committed to providing outstanding customer
     service. To best serve the needs of its do-it-yourself and professional
     customers, all Eagle Hardware associates are trained to provide the
     in-depth product knowledge and high levels of service typically associated
     with specialty stores. To support this level of service, the Company has
     developed and implemented a comprehensive training program, administered by
     each store's training director, which includes weekly training sessions for
     all associates focusing on service, selling and product knowledge. Through
     independent study and testing on product knowledge, these associates can
     achieve Eagle Expert-TM- certification and qualify for higher compensation.
     To complement the Company's commitment to customer service, each Eagle
     Hardware store has two Eagle Service Specialists-TM- who work directly with
     customers to furnish unique and personalized solutions for special orders,
     installation, major projects and other requests. In 1998, the Company plans
     to introduce the Eagle "PRO" training program.  Employees participating in
     the "PRO" training will receive additional training in operational skills,
     selling skills and product knowledge beyond the basic training that all
     store associates receive.  In addition, in its effort to be the "Nordstrom"
     of the home improvement industry in terms of customer service, the Company
     maintains a "no-hassle" return policy to make it easy for customers to
     return or exchange products. 

                                          3
<PAGE>

     CONVENIENT LOCATIONS  Recognizing the importance of convenience in the
     customer's decision-making process, the Company places a priority on
     developing new stores in locations that maximize convenience and
     accessibility. Management's home improvement industry experience in the
     western United States has enabled the Company to develop an in-depth
     understanding of its existing and targeted new markets, which the Company
     believes has allowed it to identify and secure favorable sites for new
     stores. The Company typically locates its stores near major freeways or
     thoroughfares to provide convenient access and greater visibility. 
     
     EVERYDAY LOW PRICES  Eagle Hardware has a policy of maintaining everyday
     low prices on products carried by other home centers and generally does not
     engage in promotional sale pricing. The Company will match prices on
     products carried by competing home centers. At the same time, the Company
     benefits from higher margins on hard-to-find merchandise and on products
     not carried by its competitors.
     
EXPANSION STRATEGY

     The Company's expansion strategy is two-fold. The first element of the
Company's strategy is to cluster multiple home centers in metropolitan areas.
This clustering strategy is designed to saturate larger markets in order to
increase market share and operating leverage. The second element of the
Company's strategy is to operate home centers in single-store markets. This
strategy is designed to establish favorable market positions in small markets in
which the Company believes operating costs are typically lower and competition
is less intense.

     CLUSTER STORES IN METROPOLITAN MARKETS  To provide more convenient access
     to its stores, expand its total market share and achieve economies of
     scale, the Company's strategy is to continue clustering stores in its
     existing metropolitan markets, such as Seattle, Salt Lake City and Denver,
     and enter additional metropolitan markets in the western United States. The
     Company believes this strategy has enabled it to achieve the largest market
     share in the greater Seattle area. Consistent with this strategy, the
     Company currently plans to open additional stores in the greater Seattle
     and Denver markets in fiscal 1998. Future markets in which the Company
     plans to apply its clustering strategy include the Portland, Oregon market
     and several California markets.  

     OPEN HOME CENTERS IN SINGLE-STORE MARKETS  The second element of the
     Company's strategy is to open home centers in single-store markets. The
     Company believes that these markets typically have less competition from
     other home centers, provide lower operating costs, such as rent and
     advertising, and represent numerous expansion opportunities. The Company
     currently operates home centers in single-store markets such as Kennewick
     and Yakima, Washington, Medford, Oregon and Billings, Montana. The Company
     believes that there are numerous single-store market opportunities in the
     western United States, including certain smaller markets in California. To
     augment this expansion strategy in certain single-store markets, the
     Company utilizes a store prototype described further under "Store Design."

     In choosing specific sites within a market, the Company takes into account
numerous factors, including local demographics and consumer spending patterns,
the average age of the homes in the area, traffic patterns, the location of
competitors and overall retail activity. The following table shows the location,
anticipated opening, size and status of each of the Company's currently planned
store openings for fiscal 1998: 

                                          4
<PAGE>

<TABLE>
<CAPTION>
 

  STORE LOCATION                      ANTICIPATED OPENING                    SELLING SQUARE FEET         SITE STATUS
--------------------                  -------------------                    -------------------         -----------
<S>                                   <C>                                    <C>                         <C>
  GREATER SEATTLE:
      Smokey Point, Washington        Third Fiscal Quarter 1998              168,732 (1)                 Under Contract
  GREATER DENVER:
      Aurora, Colorado                Fourth Fiscal Quarter 1998             125,100                     Under Contract
  MARKETS IN SOUTHERN CALIFORNIA:
    Westminster, California           Fourth Fiscal Quarter 1998             113,100                     Under Contract
    Chino Hills, California           Fourth Fiscal Quarter 1998             124,698                     Under Contract
  SINGLE-STORE MARKETS:
    La Quinta, California             Opened February 26, 1998               164,755 (2)                 Open
    Sparks, Nevada                    Third Fiscal Quarter 1998              177,060 (3)                 Under Contract
    Reno, Nevada                      Fourth Fiscal Quarter 1998             175,120 (1)                 Under Contract

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

</TABLE>
 


(1)  Includes an attached drive-through lumber and building materials yard
     consisting of 57,350 square feet.  
(2)  Includes an attached drive-through lumber and building materials yard
     consisting of 55,905 square feet.
(3)  Includes an attached drive-through lumber and building materials yard
     consisting of 60,900 square feet.



STORE DESIGN

     Since its inception, the Company has focused on creating the best home
improvement shopping experience for its customers by combining the selection and
value associated with traditional warehouse-format home centers with the
comfortable atmosphere and service orientation of specialty retailers. The
Company's home centers are constructed based on a standardized plan developed
from management's research and extensive industry experience. The focal point of
the Company's home centers is an innovative Design Center, which is intended to
stimulate home improvement ideas by conveying the image of a free home show
every day. The Design Center is typically adjacent to an area of approximately
8,000 square feet featuring kitchen and bath displays in fully accessorized
real-life settings and a wide assortment of countertops, wallpaper, floor
coverings and window treatments. Eagle Hardware's design coordinators work with
customers at the Design Center to conceptualize and plan virtually any home
decorating project. 

     The Design Center is surrounded by a tiled "racetrack" aisle, providing
convenient access to the store's various departments, which are located in
well-defined areas around the central core. Related departments are located
adjacent to one another and merchandise is displayed in a consistent manner
according to centrally developed plan-o-grams. Each department is designed for
effective product presentation to appeal to specific customer needs. High
warehouse-style racking is blended with attractive displays and wide, brightly
lit aisles. 

     Most Eagle Hardware stores have an additional entrance and exit, cashier
and loading area conveniently located near the lumber and building materials
department. This separate access enables customers to obtain their lumber and
building supplies quickly and comfortably, without having to carry merchandise
through other departments. Employees are available to help customers load their
vehicles. The Company believes that its customer-friendly store format, with
well-defined departments, provides customers with an attractive shopping
environment, as well as the ability to locate merchandise easily and check out
quickly.

     The Company has augmented its expansion strategy by opening some new stores
utilizing a prototype designed for certain single-store markets. This prototype
consists of a main store of approximately 95,000 square feet and includes
certain features intended to cater to the unique needs of do-it-yourself and
professional customers in small markets, including an attached drive-through
lumber and building materials yard of approximately 60,000 square feet. Further,
the prototype offers the professional customer a wider range of products and
services, including a contractor's office with phone and fax ordering
capabilities, in addition to job site delivery. As with the larger Eagle 

                                          5
<PAGE>

Hardware stores, this prototype offers "More of Everything-Registered
Trademark-" with a product assortment of over 65,000 SKUs. The Company has
opened four stores utilizing this prototype.


MERCHANDISING

PRODUCT SELECTION AND DISPLAY  Through its broad merchandising selection, Eagle
Hardware seeks to offer "More of Everything-Registered Trademark-" to its
customers and create a one-stop shopping environment where do-it-yourself
customers and professional contractors can purchase all necessary items in a
highly efficient manner. The Company's merchandise selection is broad enough to
allow both do-it-yourself customers and professional contractors to purchase
virtually every item needed to build an entire house, including many items not
generally carried by competitors. The Company believes that its SKU count of
over 65,000 items is broader than its primary warehouse home center competitors.
The Company's home centers also maintain an average in-stock position of over
98%. 

     The major departments in each Eagle Hardware home center are plumbing,
electrical and lighting; lumber and building materials; paint and decor; tools
and hardware; and lawn and garden supplies. The Company's percentages of net
sales by product categories have been fairly stable over time. The following
table sets forth the Company's percentage of net sales by product categories for
fiscal 1997: 

<TABLE>
<CAPTION>

          CATEGORIES                                      PERCENT
          ----------                                      --------
          <S>                                             <C>
          Plumbing, electrical and lighting______________    24%
          Lumber and building materials__________________    26
          Paint and decor________________________________    18
          Tools and hardware_____________________________    16
          Lawn and garden supplies_______________________    16  
                                                           ------
               Total net sales___________________________   100%
                                                           ------

</TABLE>

     The number of items described below may vary slightly from store to store
based on local market characteristics. 

     EAGLE HARDWARE'S DESIGN CENTER is the focal point of the central core of
each of the Company's home centers. The central core features different kitchen
and bathroom displays, approximately 27 styles of kitchen cabinets, brand name
appliances such as G.E., Jenn-Air, Kitchen Aid, Maytag, Panasonic and Whirlpool
and a large selection of bathroom fixtures.  Many of the kitchen and bath
displays are arranged in fully accessorized real-life settings. A wide
assortment of countertops, wallpaper, floor coverings and window treatments is
also offered. Eagle Hardware's design coordinators, using specially programmed
computers, color coordination boards and a variety of free literature, work with
customers to conceptualize and plan virtually any home decorating project. The
Design Center is supported and complemented by the surrounding departments,
which are designed in part to provide customers with one-stop shopping to
implement projects conceived in the Design Center. 

     EAGLE HARDWARE'S PAINT AND DECOR DEPARTMENT carries a wide variety of
indoor and outdoor paints and stains. A computerized color matching service
helps customers analyze and select paint and stain colors more easily. The
Company's paint inventory includes competitively priced private label paints as
well as high-quality, brand name products. In addition to its large selection of
paints, stains and accessories, this department also carries a full line of
window coverings, carpet and other floor coverings, ceramic tiles, mirrors and
approximately 600 different wallpaper patterns and borders in stock. There is
also an extensive offering of wallpaper available by special order. The
department also stocks over 600 SKUs of closet and storage materials and
accessories. 

     EAGLE HARDWARE'S PLUMBING DEPARTMENT carries over 275 brand name faucets,
valves and shower heads, from manufacturers such as Delta, Moen and Price
Pfister, as well as imports from Europe, such as Grohe, which are not generally
carried by other home centers. Hundreds of other models, including those from
Kohler and Chicago Faucet, are available through special order. This department
stocks lines from three major domestic manufacturers of plumbing fixtures,
including Kohler, American Standard and Briggs and offers Jacuzzi bath tubs and
showers. Eagle 

                                          6
<PAGE>

Hardware carries full lines of plastic, galvanized and copper pipe products,
ranging from one eighth-inch to six-inch diameters. This department also stocks
over 1,320 different gaskets, stems and miscellaneous parts for faucets and
valves, and is equipped to custom cut and thread steel pipe for customers, from
one half-inch diameter to four-inch diameter. 

     EAGLE HARDWARE'S TOOLS AND HARDWARE DEPARTMENT not only carries major
brands of do-it-yourself tools and accessories, but also a wide selection of
commercial tools for contractors. As an example of the breadth of selection in
this department, the Company stocks more than 120 types of hammers, over 2,400
different power tool accessories and more than 120 different circular saw
blades. The Company also carries a wide range of contractors' tools such as
generators, concrete saws, tile and brick saws, table saws, drill presses,
welding equipment, pressure washers, air tools and compressors. The Company
stocks a variety of brand name power tools, including Black & Decker, Delta,
DeWalt, Hitachi, Homelite, MK Diamond, Makita, Milwaukee, Porter Cable, Ryobi,
Senco, Skil, Stanley Bostitch and Wen. Many harder-to-find specialty tools are
also offered. This department features over 3,700 innovative "flip bins" filled
with hardware items that are not typically offered by the Company's competitors,
from plastic tips for chair legs to bumpers, crown corks, corrugated fasteners
and metric fasteners. The fastener selection ranges from common nuts and bolts
to industrial grade 150,000-pound tensile strength fasteners. The Company
carries over 85 varieties of chain, more than 180 types of rope and over 350
types of hinges, as well as hard-to-find items such as horseshoes and industrial
hose sold by the foot.

     EAGLE HARDWARE'S ELECTRICAL DEPARTMENT carries 100 different heaters and
fans, more than 260 different telephones and accessories, over 360 different
switch plates and more than 260 different light bulbs, many of which are not
carried by competing home centers. This department stocks virtually every kind
of conduit and circuit breaker commonly used in residential structures in the
western United States and also carries specialized tools for professional
electricians.

     EAGLE HARDWARE'S LIGHTING DEPARTMENT displays more lighting fixtures than
any other major home center in the United States of which the Company is aware.
This department features over 1,600 different styles of lighting fixtures,
priced from under $10 to over $2,500, more than 450 kinds of lamp parts, over
120 styles of lamp shades and over 150 types of replacement glass for light
fixtures. 

     EAGLE HARDWARE'S LAWN AND GARDEN DEPARTMENT carries a broad selection of
hand and power gardening and lawn tools, as well as a wide variety of brand name
fertilizers and other chemicals. The lawn and garden department also carries a
broad range of seasonal nursery plants, shrubs and trees, as well as patio
furniture and barbecues. The Company carries a full line of lawn and garden
supplies and products including such brand names as Ames Tools, Black & Decker,
John Deere, Murray, Ortho, Scotts, Toro and Weedeater. To build the plant
section of the Company's lawn and garden department into a year-round business,
most stores have an indoor plant trellis and display area ranging in size from
approximately 1,200 to 1,500 square feet. In certain markets, covered outdoor
greenhouses have been added to further establish the lawn and garden department
as a year-round business. The Company carries a large inventory of live indoor
plants, supplemented by a full line of silk flowers and greenery. 

     EAGLE HARDWARE'S LUMBER AND BUILDING MATERIALS DEPARTMENT carries a full
line of windows and doors, including wood, aluminum and vinyl windows and
exterior and interior doors from Bend Door, Doorcraft, Nord Door, Challenge
Steel Doors, Jeld-Wen Corporation and Summit Window. On a special order basis,
Eagle Hardware offers the Pro-Line, Designer and Architectural Series of wood
windows from Pella. This department stocks lumber up to 16 feet in length and
from two to 12 inches in width, 450 types of decorative moldings, a full line of
Armstrong ceiling tile, a wide variety of plywood, particle board, metal fencing
and roofing materials, including roll, three-tab, metal and fiberglass, a large
selection of roof coatings and a complete selection of cement, paver and block
products.  The department also stocks over 60 kinds of ladders. 

PRICING  Eagle Hardware emphasizes its policy of maintaining everyday low prices
on products carried by competitors and does not generally engage in promotional
advertising that emphasizes sale pricing. The Company has a low price guarantee
that it advertises in all of its markets.  The Company benefits from higher
margins on hard-to-find merchandise and on products not carried by its
competitors. Although Eagle Hardware's goal is to be perceived as very price
competitive by its customers, the Company believes that enabling customers to
purchase all 

                                          7
<PAGE>

of the items needed for a particular project at one place is more important than
offering the lowest price on any single item. 

MARKETING  The Company's marketing programs are designed to create an awareness
of Eagle Hardware's comprehensive selection of brand name merchandise, superior
customer service and everyday low prices. The Company's marketing department
develops all aspects of the Company's advertising, marketing and promotional
programs. The Company's primary advertising vehicle in each of its markets
consists of four-color newspaper inserts designed by the Company's in-house
graphics department. The Company also utilizes television and limited radio and
billboard advertising. 

     A number of Eagle Hardware television advertisements in the Seattle market
area feature local professional athletes such as Randy Johnson, Jay Buhner and
Edgar Martinez of the Seattle Mariners major league baseball team. The Company
also sponsors promotional activities at professional sporting events from time
to time. The Company believes that these marketing programs both enhance
customer awareness of the Eagle Hardware & Garden-Registered Trademark- name and
foster support in the local community. 


CUSTOMER SERVICE
     
     Eagle Hardware is committed to providing superior customer service.
Carefully selected Eagle Experts-TM-, many with extensive experience in their
respective fields, are available throughout the store to provide specialized
advice to do-it-yourself customers and professional contractors. Additional
specialized personnel are available in every department, including the Design
Center and the Project Service Center, to help customers conceptualize and plan
virtually any home improvement project. To complement the Company's commitment
to customer service, each Eagle Hardware store has two Eagle Service
Specialists-TM-. These Service Specialists work directly with customers to
furnish unique and personalized solutions for special orders, installation,
major projects and other requests.

     In an effort to enhance its shopping environment, Eagle Hardware employees
perform all store restocking after hours in order to keep the aisles clear and
minimize customer disruption during business hours. Each of the Company's stores
has from 17 to 26 cash registers, enabling customers to pay for their
merchandise quickly. Customer questions, problems, returns and exchanges are
handled at a convenient service desk near the main entrance of the store. A
"no-hassle" return policy makes it easy for customers to return or exchange
products. 

     Most Eagle Hardware stores have a lounge area which contains convenient
seating, telephones and vending machines. The Company offers free electric carts
and wheelchairs for the disabled, three-wheeled baby strollers and a baby
changing area. The Company offers a credit card to qualified contractors,
businesses and retail customers under a program owned and operated by a third
party. Eagle Hardware customers can also pay by Visa, MasterCard, Discover and
American Express. Eagle Hardware home centers are open seven days a week and
most stores operate Monday through Saturday from 7:00 a.m. to 9:00 p.m. and on
Sunday from 9:00 a.m. to 7:00 p.m. 

SPECIALIZED SERVICES  Eagle Hardware offers a number of specialized services,
many of which are not offered by its competitors. These services include a cut
shop, an on-site locksmith, an Idea Center, a Project Service Center and a
separate lumber and building materials cashier and loading area. In addition,
the Company offers a delivery service and a product installation service. 

CUT SHOP  Eagle Hardware stores offer a cut shop where customers can have window
screen, fencing, glass, netting, chain, cable, hose, rope and a variety of other
materials custom cut and, in some instances, custom made. Custom cutting is done
free of charge or, on large projects, for a competitive fee. Lumber cutting is
complimentary for up to two pieces of material and is done in the lumber and
building materials department. 

LOCKSMITH SERVICE  All Eagle Hardware stores have a full-time locksmith
available for on-site consultation and assistance with locks, keys and home and
commercial security systems. The locksmith is also available for field calls. 

                                          8
<PAGE>

IDEA CENTER  Each of the Company's home centers features an Idea Center where
do-it-yourself books, plans and video tapes are offered for purchase. Free
product literature and do-it-yourself pamphlets are also available. Eagle
Hardware personnel conduct workshops on a variety of subjects, ranging from
basic electrical wiring to wallpaper hanging and ceramic tile installation.

PROJECT SERVICE CENTER  To assist do-it-yourself customers and professional
contractors, Eagle Experts-TM- and other specially trained personnel are
available at the Project Service Center, located in the lumber and building
materials department, to assist in designing and planning projects, and to help
select the appropriate materials. Free estimates for customer projects are
prepared at the Project Service Center. 

LUMBER AND BUILDING MATERIALS CASHIER AND LOADING AREA  Most Eagle Hardware
stores have an additional entrance and exit, cashier and loading area
conveniently located near the lumber and building materials department. This
separate access enables customers to obtain their lumber and building supplies
quickly and comfortably, without having to carry merchandise through other
departments. In addition, the Company's employees assist customers in loading
their vehicles. 

DELIVERY SERVICE  The Company offers a low cost delivery service at each of its
stores. Each truck is fully equipped, including a large capacity, rough terrain
forklift. 

PRODUCT INSTALLATION SERVICE  Most Eagle Hardware stores offer professional
product installation services. The Company has an agreement with a regional
installation company to provide basic installation for a number of the products
that the Company sells. This service is coordinated by Eagle Hardware personnel
to ensure customer satisfaction and a competitive fee structure. 


EMPLOYEE TRAINING AND COMPENSATION

     Eagle Hardware strives to develop the technical and interpersonal skills of
its store personnel to ensure that customers consistently receive knowledgeable
and courteous assistance. The Company provides extensive training for its entry
level store personnel through a comprehensive in-house training program that
combines on-the-job training with formal seminars and meetings. On an ongoing
basis, store personnel attend frequent in-house training sessions conducted by
the Company's training staff or by manufacturers' representatives, and receive
sales, product and other information in frequent manager meetings. Through
independent study and testing of product knowledge, sales associates can achieve
Eagle Expert-TM- certification and qualify for higher compensation.  Starting in
1998, participants in the new Eagle "PRO" training program will receive
additional training in operational skills, selling skills and product knowledge
beyond the basic training that all store associates receive.  

     Detailed training records are kept on all Eagle Hardware store personnel,
including the date and subject of each training session. To further develop the
professional skills of store personnel, the Company has appointed an on-site
training director for each store. The store training director is responsible for
supervising, organizing and scheduling all store training activities and
customer workshops. Working in conjunction with the store manager, the store
training director ensures that all store personnel attend weekly training
meetings and that training records are kept up to date. Additionally, the store
training director is responsible for instructing store personnel in the
Company's policies and procedures. The Company's training program is supervised
by a Vice President who has over 20 years of experience training home center
employees. 

     As part of its commitment to exceptional customer service, Eagle Hardware
strives to attract experienced and qualified personnel by paying competitive
wages in each of its markets. The Company expects that certain of its store
managers will receive total compensation of over $125,000 in the current fiscal
year, which the Company believes is more than the compensation received by store
managers for many other home center chains. Most of Eagle Hardware's store
personnel are paid on an hourly basis.  Store managers and assistant managers
are paid bonuses based on certain criteria, including customer service, sales,
gross margin, store profitability and inventory 

                                          9
<PAGE>

levels. Corporate buyers are paid bonuses based on the attainment of certain
sales and gross margin goals. Certain other corporate management personnel are
paid bonuses based on total Company pretax income. The Company believes that its
bonus plan is both unique in its industry and highly motivational, in part
because store manager bonuses can equal up to 100% of base compensation. 

     In addition to competitive wages, Eagle Hardware offers its employees a
comprehensive benefits program. Full-time employees are eligible to participate
in an Employee Stock Ownership Plan ("ESOP") after 24 months of service. Under
the ESOP, an employee may be credited with a maximum annual contribution of 10%
of annual salary up to a maximum contribution of $3,500. Funds credited to
individual accounts in the ESOP will be invested primarily in the Common Stock
of the Company. The Company also maintains a 401(k) retirement savings plan and
is in the process of implementing an Employee Stock Purchase Plan ("ESPP").

     Eagle Hardware also offers a stock option plan under which certain
employees are granted options to purchase the Company's Common Stock at its fair
market value on the date of grant. Options generally vest over a five-year
period and are exercisable for a period of 10 years. 

     Eagle Hardware believes that its total compensation plan and the
opportunities it offers employees for advancement within the Company are key to
employee performance, motivation and retention. Management believes that it has
a lower-than-average employee turnover rate, due, in part, to its comprehensive
compensation benefits plan. 


PURCHASING AND DISTRIBUTION

     The Company purchases most of its merchandise directly from manufacturers. 
Eagle Hardware has a staff of ten buyers, each of whom has responsibility for
specified product categories. The Company is not dependent on any single vendor
and believes that alternative sources are available for virtually all of its
products. The Company operates principally on a purchase order basis and
typically does not maintain long-term purchase contracts with its vendors. 

     Approximately 80% of the merchandise purchased by the Company is shipped by
the vendors directly to its stores. In order to help maintain a high in-stock
position and to improve inventory management and distribution efficiencies as
the number of its stores increases, the Company operates a 214,000 square foot
warehouse and distribution facility in the Puget Sound area. This facility is
used for stocking and distributing merchandise purchased overseas and from
certain domestic vendors, for cross-docking merchandise transferred between
stores and for the consolidation of freight for the Alaska and Hawaii stores.
The distribution center ships merchandise to most of the Company's stores at
least weekly using a combination of Company-owned equipment and common carriers.
In addition to its primary warehouse and distribution facility, as of January
30, 1998, the Company also leased additional warehouse space totaling
approximately 150,000 square feet. The Company is currently under contract for a
new 600,000 square foot warehouse/distribution  center in the Puget Sound area
that is under construction.  The Company plans to move into this facility by the
end of fiscal 1998 and consolidate all of its existing warehouse operations in
this facility.  


MANAGEMENT INFORMATION SYSTEMS

     The primary component of the Company's management information systems is
the JDA Retail Software package, which operates on an IBM AS/400 computer.
Corporate buyers utilize the JDA system to set up new items, order the initial
inventory for new stores and maintain store level prices. Each store is also
networked to the AS/400 for real-time receiving and replenishment. As an
additional component of the management information systems, each store is
equipped with point-of-sale scanning, price lookup and sales polling
capabilities utilizing a network of 17 to 26 registers per store. The Company
maintains its accounting information primarily on the IBM AS/400, utilizing
certain financial modules of the JDA system. In addition, the
warehouse/distribution center utilizes the JDA system in its daily operations.
The Company is currently refining its implementation of the perpetual inventory
reporting module of JDA. 

                                          10
<PAGE>

The Company also continually evaluates the adequacy of its management
information systems, including its inventory control and distribution systems,
and in the future will need to upgrade or reconfigure its management information
systems to support its planned expansion. 


COMPETITION

     The home improvement, hardware and garden businesses are highly
competitive. The Company competes against traditional hardware, plumbing,
electrical and home supply retailers, as well as warehouse-format and discount
retail stores and catalog companies. Eagle Hardware's two-fold expansion
strategy is to cluster home centers in large metropolitan areas such as Seattle,
Salt Lake City and Denver, and to open single home centers in smaller markets. 

     Ernst Home Center ("Ernst"), formerly a primary competitor in the greater
Seattle area, Salt Lake City and certain smaller markets, filed for Chapter 11
bankruptcy protection in July 1996 and subsequently obtained approval from the
court in November 1996 to conduct a Chapter 7 orderly liquidation of assets. 
For a period of time prior to its bankruptcy, the Company operated 21 stores in
markets with Ernst stores.  Liquidation of the Ernst stores was completed in the
Company's fourth quarter of fiscal 1996.  

     Twelve of the Company's 32 existing stores are located in the greater
Seattle metropolitan market.  Eagle Hardware's principal competitors in this
market are Home Depot, Fred Meyer and HomeBase. Home Depot, a warehouse-format
home center with over 600 stores in the United States, currently operates eleven
stores in the Seattle metropolitan market. Two of these stores are located next
to existing Eagle Hardware stores.  The Company's gross margin and operating
income are generally lower for stores located in markets where Home Depot also
operates stores. 

     Four of the Company's existing stores are located in the Salt Lake City
metropolitan market.  The Company's principal competitors in this market are
Home Depot, Fred Meyer and HomeBase. Home Depot operates three stores in the
Salt Lake City market. Three of the Company's existing stores are located in the
Denver metropolitan market and the Company intends to open additional stores in
this market. The Company's principal competitors in the Denver market are Home
Depot, Builders' Square, HomeBase and Hugh M. Woods (a unit of Payless
Cashways). 

     Thirteen of the Company's existing stores are located in smaller markets.
Historically, the Company's principal competitors in these markets have included
Fred Meyer and HomeBase, as well as traditional hardware, plumbing, electrical
and home supply retailers.  During 1997, Home Depot opened stores in Pueblo,
Colorado and Spokane, Washington.  Home Depot is currently constructing a store
in Anchorage, Alaska, next to an existing Eagle Hardware store.  This Home Depot
is expected to open in the spring of 1998.  According to published reports, Home
Depot is pursuing sites in Billings, Montana, Coeur d'Alene, Idaho and Honolulu,
Hawaii, as well as a second site in Spokane, Washington.  The Company's ability
to expand into and operate profitably in new markets, particularly small
markets, may be adversely affected by the existence or entry of competing
warehouse-format home centers. 


EMPLOYEES

     Each Eagle Hardware home center employs approximately 120 to 250 full- and
part-time personnel, depending on the sales volume of the store and the time of
the year. Store management includes the store manager, a store
manager-in-training, four to five assistant store managers, department managers
and sales supervisors. As of January 30, 1998, the Company employed
approximately 5,600 persons, of whom approximately 210 were in corporate
administration. Of these 5,600 persons, approximately 87% were full-time
employees. Eagle Hardware is not a party to any collective bargaining agreements
and is not aware of any efforts to unionize its employees. The Company considers
its relations with its employees to be good.

                                          11
<PAGE>


TRADEMARKS AND SERVICE MARKS

     The Company holds a federal trademark registration for MORE OF
EVERYTHING-Registered Trademark- (and design) and a concurrent federal service
mark registration for EAGLE HARDWARE & GARDEN-Registered Trademark- (and design)
for the western United States. Eagle Food Centers, Inc., a grocery store chain
in the midwest, holds a concurrent federal registration for "Eagle" for the
eastern United States, and, with certain limited geographic exceptions, the
parties cross-license each other for use of the word "Eagle" in the other
party's geographic markets. The Company does not expect that this arrangement
will impact its ability to use the EAGLE HARDWARE & GARDEN-Registered Trademark-
(and design) mark in any states in which it currently operates or anticipates
opening stores. In addition, the Company claims common law rights to the
foregoing and various other trademarks and service marks.


RISK FACTORS


     COMPETITION  The home improvement, hardware and garden businesses are all
highly competitive. The Company competes against traditional hardware, plumbing,
electrical and home supply retailers, as well as warehouse-format and discount
retail stores and catalog companies. Twenty-two of the Company's 32 stores
compete in markets where Home Depot, a warehouse-format home center with over
600 stores in the United States, also operates stores.  Four of these stores are
located next to existing Eagle Hardware stores. The Company's gross margin and
operating income are generally lower for stores located in markets where Home
Depot also operates stores. The Company also currently competes against a number
of other companies in the western United States, including Fred Meyer, HomeBase,
Builders' Square and Hugh M. Woods (a unit of Payless Cashways). Many of the
Company's competitors have substantially greater resources than the Company. In
addition, there has been increasing consolidation within the home improvement
industry, which may provide certain entities with even stronger competitive
advantages over the Company. Moreover, the Company's ability to expand into and
operate profitably in new markets, particularly small markets, may be adversely
affected by the existence or entry of competing warehouse-format home centers. 

     Should Home Depot or any of the Company's other competitors reduce prices
in any of Eagle Hardware's markets, the Company may be required to implement
price reductions in order to remain competitive. In addition, although the
Company believes that alternative sources of merchandise are available, some of
the Company's competitors may attempt to negotiate exclusive supply arrangements
with certain of the Company's vendors, which could result in the loss of
individual sources of merchandise. The implementation of price reductions or the
loss of certain key vendors could have a material adverse effect on the
Company's business, financial condition and operating results.

     EXPANSION PLANS  The Company opened its first store in November 1990 and
currently operates 32 home improvement centers, averaging 128,000 square feet
(excluding storage and exterior garden square footage). The Company's expansion
strategy is to cluster multiple home centers in metropolitan areas such as
Seattle, Salt Lake City and Denver, and to open single home centers in small
markets. In the Company's experience, the opening of additional Eagle Hardware
stores in existing markets tends to negatively impact same store sales at
existing stores. The Company expects this trend, commonly referred to as "sales
cannibalization," to continue as a result of its planned expansion program.
Further, the Company's ability to successfully execute its expansion strategy
will depend, in large part, on its ability to obtain suitable store sites at
acceptable prices, particularly sites meeting the large space requirements of
Eagle Hardware stores. In addition, the Company has encountered, and may
continue to encounter, substantial delays, increased expenses or loss of
potential sites due to the complexities associated with the regulatory and
permitting process in markets in which the Company intends to locate its stores.
There can be no assurance that the Company will be able to open the planned
number of new stores according to its store opening schedule; failure to do so
could have a material adverse effect on the Company's business, financial
condition and operating results. 

                                          12
<PAGE>

     The Company augmented its expansion strategy to include a store prototype
designed for selected single-store small markets. This prototype consists of a
main store of approximately 95,000 square feet and includes certain features
intended to cater to the unique needs of do-it-yourself and professional
customers in small markets, including an attached drive-through lumber and
building materials yard of approximately 60,000 square feet. The Company is
utilizing this prototype in Wenatchee, Washington, Pueblo, Colorado, Kahului
(Maui), Hawaii and La Quinta, California. Although the Company has operated
stores in small markets for a number of years, the first Eagle Hardware store
based on this new prototype was opened in August 1996; therefore, the Company's
experience with the new prototype is limited. The Company anticipates that
average annual sales levels achieved by stores located in small markets will be
lower than those obtained by stores operated in large metropolitan markets. In
addition, there can be no assurance that the Company's future stores, including
those based on this new prototype, will achieve anticipated sales and gross
margin levels or that they will prove to be profitable. Should any new store be
unprofitable or should any existing store experience a decline in profitability,
the effect on the Company's results of operations could be more significant than
would be the case with a larger company. 

     The construction of new store facilities and the conversion of existing
structures into Eagle Hardware stores are also subject to unexpected delays,
which could lead to higher costs. The Company's expansion further depends on its
ability to complete the improvements at its home centers in a timely manner, to
hire and train competent store managers and staff, and to integrate these
employees and new home centers into its overall systems and operations. Because
the Company will be expanding into geographic markets in which it has no
previous operating experience, it may face competitive challenges, delays or
other problems that are different from those encountered to date. There can be
no assurance that the Company will be able to enter new geographic markets
successfully. 

     The Company has signed agreements to purchase the land or lease the ground
for 13 additional stores scheduled to open during fiscal 1998 or 1999. As a
result, the Company will be required to finance the construction of the new
store buildings on these sites, and will incur significant inventory and capital
expenditures and preopening costs. The Company believes that its current cash
and short-term investments, cash generated from operations, in combination with
anticipated bank borrowings under the existing line of credit and the proceeds
of fixed-term capital asset loans and/or sale-leaseback transactions, will be
sufficient to satisfy its anticipated working capital, capital expenditure,
interest and debt service requirements through fiscal 1998. However, at times in
the past the Company has exceeded its capital expenditure budget substantially
as a result of project delays, construction cost overruns and other factors, and
the Company may be required to seek additional sources of funds for its planned
expansion. There can be no assurance that such funds will be available on
satisfactory terms. Failure to obtain such financing could delay or prevent the
Company's planned expansion, which could adversely affect the Company's
business, financial condition and operating results. In addition, there can be
no assurance that there will not be a decline in the market value of the
Company's properties, which could also have an adverse effect on the Company's
business, financial condition and operating results.  (See Item 1 - Business -
Expansion Strategy)

     ABILITY TO MANAGE GROWTH; DEPENDENCE ON ACCOUNTING AND MANAGEMENT 
INFORMATION SYSTEMS  The Company has experienced significant growth in recent 
years and intends to continue its growth strategy. This strategy will require 
an increase in Company personnel, particularly store managers and sales 
associates, who possess the training and experience necessary to operate the 
Company's new stores. There can be no assurance that the Company will be able 
to continue to attract, develop and retain the personnel necessary to pursue 
its growth strategy. In addition, Eagle Hardware's growth places pressure on 
its accounting systems and internal controls. The Company has taken a number 
of steps over the past several years to improve its accounting systems and 
internal controls. However, there can be no assurance that problems 
associated with the Company's growth will not occur in the future. Any such 
problems could have a material adverse impact on the Company's business, 
financial condition and results of operation. The Company will also need to 
continually evaluate the adequacy of its management information systems, 
including its inventory control and distribution systems, and in the future 
will need to upgrade or reconfigure its management information systems to 
support its planned expansion. While the Company has taken a number of 
precautions against certain events that could disrupt the operation of its 
management information systems, including in connection with its planned 
systems revisions, there can be no assurance that the Company will not 
experience systems failures or interruptions, which could have a material 
adverse effect on its 

                                          13
<PAGE>

business, financial condition and operating results. Further, the Company
currently relies on a single outside vendor for the software and support of its
management information systems. Although the Company believes that alternative
information systems vendors are available, in the event it were to change
vendors, the Company could experience systems delays or interruptions, which
could have a material adverse effect on the Company's business, financial
condition and operating results. Moreover, as the Company grows, it will need to
continually analyze the sufficiency of its warehouse and distribution space and
will require additional facilities in order to support such growth.

     YEAR 2000  The year 2000 issue is the result of computer programs being
written using two digits rather than four digits to define the applicable year. 
Any of the Company's computer programs that have time-sensitive software may
recognize a date using "00" as the year 1900 rather than the year 2000.  If not
addressed, the direct result could be a system failure or miscalculations
causing disruption of operations, including, among other things, a temporary
inability to process customer transactions, order merchandise, or engage in
similar normal business activities.  

     Eagle management has initiated a Company-wide program to prepare its
computer systems and applications for the year 2000 by the middle of fiscal
1999. Although management anticipates that its systems and applications will be
year 2000 compliant on a timely basis, there can be no assurance that the
systems of other companies on which the Company's systems rely will be year 2000
compliant in the same time frame.  Any such failure on the part of other
companies with whom the Company transacts business, to be year 2000 compliant on
a timely basis, may have an adverse impact on the operations of the Company.  


     FLUCTUATIONS IN SAME STORE SALES  A variety of factors affect the Company's
same store sales, including, among others, actions of competitors (including the
opening of additional stores in the Company's markets), the retail sales
environment, general economic conditions, weather conditions and the Company's
ability to execute its business strategy effectively. In addition, the Company's
expansion plans include the opening of additional stores in market areas where
the Company has already opened stores. The Company's experience has been that
opening such additional stores in the same market area reduces sales at existing
Company stores located in that area and the Company expects this sales
cannibalization to continue in the future.  The Company's quarterly and annual
same store sales have fluctuated significantly in the past and may do so in the
future. The Company's annual same store sales increases (decreases) over the
prior year were 11%, 11% and (7%) in fiscal years 1997, 1996 and 1995,
respectively.  New store openings by the Company in existing markets and
significant same store sales increases experienced in 1996 and 1997, combined
with other factors such as competition and economic trends in the Company's
markets, may result in future same store sales increases lower than those
experienced in fiscal 1996 and fiscal 1997. Moreover, there can be no assurance
that same store sales for any particular period will not decrease in the future.
Changes in the Company's same store sales have in the past and could in the
future cause the price of the common stock to fluctuate substantially. 

     FLUCTUATIONS IN QUARTERLY RESULTS AND SEASONALITY The Company's quarterly
operating results have fluctuated in the past and are expected to fluctuate in
the future as a result of a variety of factors, including the timing of store
openings and related preopening expenses, weather conditions, price increases by
suppliers, actions by competitors, conditions in the home improvement market and
the hardware industry in general, regional and national economic conditions and
other factors. Moreover, the Company expects its business to exhibit some
measure of seasonality, which the Company believes is typical of the retail home
center industry. The Company anticipates that its gross margin percentage will
generally be lower in the second and third quarters of each fiscal year, when
sales of lower-margin products are proportionately greater. The Company also
expects that, in general, individual stores will experience lower net sales and
operating income and that cash flow from operations will be lower in the fourth
quarter than in any other quarter, due primarily to the effect of winter weather
on home improvement projects and the lack of significant sales of lawn and
garden items during the quarter. 

     GENERAL ECONOMIC CONDITIONS The success of the Company's operations depends
on a number of economic conditions. In particular, higher mortgage interest
rates and slower housing turnover will generally have an adverse effect on the
Company's sales and earnings. The Company cannot predict with certainty the
effect on its 

                                          14
<PAGE>

future earnings if either the national or regional economies of the United
States face a downturn or encounter periods of high inflation and rising
interest rates. 

     GEOGRAPHIC CONCENTRATION As its operations are located entirely in the
western United States, the Company is subject to regional risks, such as the
economy, weather conditions, natural disasters and government regulations. If
the region were to suffer an economic downturn or other adverse regional events
occur, there may be an adverse impact on the Company's sales and profitability
and its ability to implement its planned expansion program. Some of the
Company's competitors, including Home Depot, operate stores across the United
States and thus are not as vulnerable as the Company to such regional risks. 

     DEPENDENCE ON KEY INDIVIDUALS The Company's success depends in large part
on the abilities and continued service of its executive officers and other key
employees, including David J. Heerensperger, the Company's founder and Chairman,
and Richard T. Takata, the Company's President and Chief Executive Officer. Most
of these individuals, including Messrs. Heerensperger and Takata, are not
subject to employment agreements that would prevent them from leaving the
Company. There can be no assurance that the Company will be able to retain the
services of such executive officers and other key employees. The loss of key
personnel could have a material adverse effect on the Company's business,
financial condition and operating results.

     VOLATILITY OF STOCK PRICE The market price of the common stock has
fluctuated substantially since the Company's initial public offering in July
1992. There can be no assurance that the market price of the common stock will
not fluctuate significantly from its current level. Future announcements
concerning the Company or its competitors, quarterly variations in operating
results or same store sales, changes in product mix or prices by the Company or
its competitors, weather patterns or economic trends that may be perceived to
affect the demand for the Company's products, changes in earnings estimates by
analysts or changes in accounting policies, among other factors, could cause the
market price of the common stock to continue to fluctuate substantially. In
addition, stock markets have experienced extreme price and volume volatility in
recent years. This volatility has had a substantial effect on the market prices
of securities of many public companies for reasons frequently unrelated to the
operating performance of the specific companies. These broad market fluctuations
may adversely affect the market price of the common stock. 

     ANTITAKEOVER CONSIDERATIONS Certain provisions of the Company's Restated
Articles of Incorporation and Restated Bylaws, as well as the Washington
Business Corporation Act, could discourage a third party from attempting to
acquire, or make it more difficult for a third party to acquire, control of the
Company without approval of the Company's Board of Directors. Such provisions
could also limit the price that certain investors might be willing to pay in the
future for the Common Stock. Certain of such provisions allow the Board of
Directors to authorize the issuance of preferred stock with rights superior to
those of the Common Stock. Additionally, the Company's Restated Bylaws provide
for staggered terms for the Board of Directors. The Company is also subject to
the provisions of Chapter 23B.19 of the Washington Business Corporation Act,
which generally prohibits any "significant business transactions" within five
years of the date a person acquires 10% or more of the outstanding voting shares
of a Washington corporation unless the transaction or the acquisition is
approved prior to the acquisition date by a majority of a company's then board
of directors. After the five-year period, a "significant business transaction"
may take place as long as it complies with certain "fair price" provisions of
the statute which generally prohibits "interested shareholder transactions"
(such as a merger, sale of assets or liquidation) with a person who beneficially
owns 20% or more of a corporation's outstanding voting securities, unless
approved by a majority vote of disinterested directors or a two-thirds vote of
disinterested shareholders. A corporation may not "opt out" of this statute.
This provision may have the effect of delaying, deferring or preventing a change
in control of the Company.    


ITEM 2 - PROPERTIES - 

     The Company's headquarters consists of approximately 48,000 square feet of
leased office space in Renton, Washington.  The Company leases warehouse and
distribution center space of approximately 364,000 square feet in Auburn,
Washington. The Company is currently under contract to lease a new 600,000
square foot 

                                          15
<PAGE>

warehouse/distribution center and plans to move into this new facility by the
end of fiscal 1998.  The Company intends to acquire this facility at a future
date.  

     The Company leases 17 of its 32 existing stores under various lease terms
which, including renewal options, range from 21 to 51 years. The leases
generally provide for minimum annual rental amounts, with additional rental
payments based upon a percentage of gross store sales. These additional payments
range from 1.5% to 3.0% of annual gross sales in excess of a specified amount,
which ranges from $24.0 million to $50.0 million per store. One store lease
provides for additional payments of 0.75% of gross sales, with a specified
minimum dollar amount. In most cases, lease payments do not begin until a store
is operational. 

     The Company owns 15 of its existing stores and has signed agreements to
purchase sites or lease ground for 13 future stores. In light of current
economic conditions and other strategic factors, the Company has frequently
elected to purchase land for new store sites and finance the construction of new
stores in order to proceed expeditiously with its expansion program.



ITEM 3 - LEGAL PROCEEDINGS -

     The Company is involved in various routine legal proceedings incident to
the ordinary course of its business. Management believes that the outcome of all
pending legal proceedings in the aggregate will not have a material adverse
effect on the Company's business, financial condition and operating results.


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

     No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year ended January 30, 1998.
                                          
                                          
                                      PART II

ITEM 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS -

     The information required by this Item is included in the Company's Annual
Report to Shareholders for the fiscal year ended January 30, 1998 under the
heading "Quarterly Stock Data" and is incorporated herein by this reference.


ITEM 6 - SELECTED FINANCIAL DATA - 

     The information required by this Item is included in the Company's Annual
Report to Shareholders for the fiscal year ended January 30, 1998 under the
heading "Five Year Summary of Selected Financial Data" and is incorporated
herein by this reference. 


ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION -

                                          16
<PAGE>

     The information required by this Item is included in the Company's Annual
Report to Shareholders for the fiscal year ended January 30, 1998 under the
heading "Management's Discussion and Analysis of Results of Operations and
Financial Condition" and is incorporated herein by this reference. 

ITEM 7A - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK -

     Not applicable.


ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA -

     The financial statements and other information required by this Item are
included in the Company's Annual Report to Shareholders for the fiscal year
ended January 30, 1998 at pages 15 through 35 and are incorporated herein by
this reference.     
     

ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON AUDITING AND FINANCIAL
DISCLOSURE -

     There were no changes in or disagreements with accountants on auditing and
financial disclosure during the fiscal year ended January 30, 1998.


                                       PART III


ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT -
 
     The information required by this Item is included in the Company's
definitive Proxy Statement for the Company's 1998 Annual Meeting of
Shareholders, to be filed with the Securities and Exchange Commission, under the
heading "Election of Directors" and is incorporated herein by this reference.


ITEM 11 - EXECUTIVE COMPENSATION -

     The information required by this Item is included in the Company's
definitive Proxy Statement for the Company's 1998 Annual Meeting of
Shareholders, to be filed with the Securities and Exchange Commission, under the
heading "Executive Compensation" and is incorporated herein by this reference.


ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT -

     The information required by this Item is included in the Company's
definitive Proxy Statement for the Company's 1998 Annual Meeting of
Shareholders, to be filed with the Securities and Exchange Commission, under the
heading "Voting Securities and Principal Holders" and is incorporated herein by
this reference.


ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS -

                                          17
<PAGE>

     The information required by this Item is included in the Company's
definitive Proxy Statement for the Company's 1998 Annual Meeting of
Shareholders, to be filed with the Securities and Exchange Commission, under the
heading "Certain Relationships and Related Transactions" and is incorporated
herein by this reference.
                                          
                                          
                                      PART IV


ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON 
FORM 8-K -

   (a)    1.  Financial Statements:

     The following financial statements and related information filed as part of
this report are included on pages 22 through 35 of the Company's Annual Report
to Shareholders for the fiscal year ended January 30, 1998. 

          -    Consolidated Balance Sheets - January 30, 1998 and January 31,
               1997 

          -    Consolidated Statements of Operations - For the fiscal years
               ended January 30, 1998, January 31, 1997 and January 26, 1996    

          -    Consolidated Statements of Cash Flows - For the fiscal years
               ended January 30, 1998, January 31, 1997 and January 26, 1996    

          -    Consolidated Statements of Shareholders' Equity - For the fiscal
               years ended January 30, 1998, January 31, 1997 and January 26,
               1996

          -    Notes to Consolidated Financial Statements - For the fiscal years
               ended January 30, 1998, January 31, 1997 and January 26, 1996    

          -    Selected Quarterly Financial Data (Unaudited) - For the fiscal
               years ended January 30, 1998 and January 31, 1997 - See Note 12
               of Notes to
               Consolidated Financial Statements  
     
          -    Report of Ernst & Young LLP, Independent Auditors 


     2.  Financial Statement Schedules:

     All financial statement schedules are omitted because they are not
applicable or because the information is presented in the financial statements
or notes thereto.

     3.  Exhibits:  
     
     Exhibits marked with a footnote designation (#) are hereby incorporated by
reference to exhibits or appendices previously filed by the Registrant as
indicated in the referenced footnote.

                                          18
<PAGE>

EXHIBIT
NUMBER         DESCRIPTION                                                      

  3.1       Restated Articles of Incorporation. (3)
  3.2       Restated Bylaws. (3)
  4.1       Form of Debenture (included in Exhibit 4.2B).
  4.2B      Form of Indenture dated as of March 14, 1994, between Eagle
              Hardware & Garden, Inc. and Seattle-First National Bank, as 
              Trustee.  (7)
  10.1      Directors' Nonqualified Stock Option Plan. (1)
  10.2      1991 Stock Option Plan. (1)
  10.3      Eagle Hardware & Garden Profit Sharing/Retirement Savings Plan. (1)
  10.3A     First Amendment to Eagle Hardware & Garden Profit
              Sharing/Retirement Savings Plan. (10)
  10.3B     Second Amendment to Eagle Hardware & Garden Profit
              Sharing/Retirement Savings Plan. (10)
  10.3C     Third Amendment to Eagle Hardware & Garden Profit
              Sharing/Retirement Savings Plan. (12)
  10.3D     Fourth Amendment to Eagle Hardware & Garden Profit
              Sharing/Retirement Savings Plan. (12)
  10.4      Description of Corporate Bonus Plan. (1)  
  10.5      Registration Rights Agreement dated as of June 25, 1991, between
              the Company and certain holders of the Company's capital stock. 
              (1)
  10.6      Key Man Life Insurance Policy for David J. Heerensperger by the
              Great-West Life Assurance Company. (1)
  10.7      Sublease dated September 10, 1990, by and between Payless Drug
              Stores Northwest, Inc. and Eagle Hardware & Garden, Inc., 
              as amended. (2)
  10.10     Lease dated November 30, 1990, by and between Harlan D. Douglass
              and Maxine H. Douglass and Eagle Hardware & Garden, Inc. (1)
  10.10A    First Amendment to Lease dated May 22, 1992, by and between Harlan
              D. Douglass and Maxine H. Douglass and Eagle Hardware & Garden, 
              Inc. (1)
  10.11     Lease dated as of April 18, 1991, by and between Mercy  Development
              Company, M&E Company and Eagle Hardware & Garden, Inc. (2)
  10.11A    Addendum to Mercy Development/M&E Co. - Eagle Hardware Lease dated
              July 11, 1991. (10)
  10.11B    Second Addendum to Mercy Development/M&E Co. - Eagle Hardware Lease
              dated May 1, 1994. (10)
  10.15     Lease dated as of August 20, 1991, by and between Vernell's Fine
              Candies, Inc. and Eagle Hardware & Garden, Inc. (2)
  10.15A    Amendment to Lease dated as of May 4, 1992, by and between Keystone
              Capital Company, Inc. (formerly known as Vernell's Fine Candies, 
              Inc.) and Eagle Hardware & Garden, Inc. (2)
  10.17     Lease dated November 18, 1991, by and between Hsiao-Tall Real
              Estate Company and Eagle Hardware & Garden, Inc. (2)
  10.17A    Amendment to Lease dated as of June 30, 1992, by and between
              Hsiao-Tall Real Estate Company and Eagle Hardware & Garden, 
              Inc. (4)
  10.17B    Third Amendment to Lease dated as of September 28, 1992, by and
              between Hsiao-Tall Real Estate Company and Eagle Hardware & 
              Garden, Inc. (3)
  10.17C    Amendment to Lease Concerning Storm Drainage System dated as of
              April 1, 1992, by and between Hsiao-Tall Real Estate Company 
              and Eagle Hardware & Garden, Inc. (10)
  10.19     Space Lease dated as of January 21, 1992, by and between WCC
              Associates and Eagle Hardware & Garden, Inc. (2)
  10.19A    First Amendment to Space Lease dated as of May 29, 1992, by and
              between WCC Associates and Eagle Hardware & Garden, Inc. (2)
  10.20     Master Equipment Lease dated October 30, 1991, by and between XL
              Datacomp, Inc. and Eagle Hardware & Garden, Inc. (1)
  10.20C    Schedule 1 dated July 1, 1994, to Master Equipment Lease by and
              between XL Datacomp, Inc. and Eagle Hardware & Garden, Inc. (10)
  10.20D    Lease of Equipment dated June 7, 1994, and Schedule 5 to Lease of
              Equipment dated November 15, 1995, by and between The Archive
              Group, Inc. and Eagle Hardware & Garden, Inc. (11)

                                          19
<PAGE>

EXHIBIT
NUMBER      DESCRIPTION

  10.20E    Lease of Equipment dated November 15, 1995, and Schedule 4 to Lease 
              of Equipment by and between The Archive Group, Inc. and Eagle
              Hardware & Garden, Inc. (11)
  10.22     Software License Agreement dated December 9, 1991, by and between   
              JDA Software Services, Inc. and Eagle Hardware & Garden, Inc. (1)
  10.23     Assignment dated as of February 5, 1992, by Harlan D. Douglass and
              Maxine H. Douglass to Eagle Hardware & Garden, Inc. (1)
  10.24     Assignment dated as of March 13, 1992, by Eagle Hardware & Garden,
              Inc. to R&B Development, Inc. (1)
  10.25     Assignment dated as of February 5, 1992, by Harlan D. Douglass and
              Maxine H. Douglass to Eagle Hardware & Garden, Inc. (1)
  10.26     Assignment dated as of April 29, 1992, by Eagle Hardware & Garden,
              Inc. to R&B Development, Inc. (1)
  10.27     Real Property Transfer Agreement dated April 29, 1992, by and
              between Eagle Hardware & Garden, Inc. and R&B Development, Inc. 
              (1)
  10.28     Lease dated as of March 10, 1992, by and between R&B Development,
              Inc. and Eagle Hardware & Garden, Inc. (2)
  10.29     Lease dated as of March 10, 1992, by and between R&B Development,
              Inc. and Eagle Hardware & Garden, Inc. (2)       
  10.32     Assignment of Contract and Deed dated as of February 24, 1993, by
              Eagle Hardware & Garden, Inc. to Harlan D. Douglass and Maxine H.
              Douglass. (3)
  10.33     Lease dated as of September 29, 1992, by and between F.C.
              Investments, Inc. and Eagle Hardware & Garden, Inc. (4)
  10.34     Lease dated September 22, 1992, by and between R&B Development,
              Inc. and Eagle Hardware & Garden, Inc. (4)
  10.34A    First Amendment to Lease dated as of June 23, 1994, by and between
              R&B Development, Inc. and Eagle Hardware & Garden, Inc. (10)
  10.38     Eagle Hardware & Garden, Inc. Employee Stock Ownership Plan
              effective January 1, 1992. (3)
  10.38A    First Amendment to Eagle Hardware & Garden, Inc. Employee Stock
              Ownership Plan dated January 15, 1994. (10)
  10.38B    Second Amendment to Eagle Hardware & Garden, Inc. Employee Stock
              Ownership Plan dated June 7, 1994. (10)
  10.38C    Third Amendment to Eagle Hardware & Garden, Inc. Employee Stock
              Ownership Plan dated March 6, 1995. (10)
  10.39     Eagle Hardware & Garden, Inc. Employee Stock Ownership Trust
              Agreement effective January 1, 1992. (3)
  10.39A    First Amendment to the Eagle Hardware & Garden, Inc. Employee Stock
              Ownership Trust Agreement effective April 1, 1998.
  10.46     Agreement effective September 1, 1992, by and between Northwestern
              National Life Insurance Company and Eagle Hardware & Garden, Inc.
              (3)
  10.47     Lease dated March 18, 1993, by and between Harlan D. Douglass and
              Maxine H. Douglass and Eagle Hardware & Garden, Inc. (4)
  10.47A    First Amendment to Lease dated September 1, 1995, by and between
              Harlan D. Douglass and Maxine H. Douglass and Eagle Hardware &
              Garden, Inc. (11)
  10.48     Lease dated March 19, 1993, by and between Harlan D. Douglass and
              Maxine H. Douglass and Eagle Hardware & Garden, Inc. (4)

                                          20
<PAGE>

EXHIBIT
NUMBER      DESCRIPTION

  10.49     Lease dated as of February 28, 1993, by and between West Valley 29
              Partners and Eagle Hardware & Garden, Inc. (4)
  10.49A    Amendment to Lease Agreement dated September 15, 1993, by and
              between West Valley 29 Partners and Eagle Hardware & Garden, Inc.
              (8)
  10.49B    Second Amendment to Lease dated February 1, 1997 by and among West
              Valley 29 Partners, Eagle Hardware & Garden, Inc. and Eagle 
              Hardware & Garden Distribution Services, Inc. (14)
  10.53     Lease dated as of September 10, 1973, between Elting, Graziadio &
              Sampson Development Company and S. S. Kresge Company. (8)
  10.53A    First Amendment to Lease dated November 14, 1975, between EGSmetro
              Construction  Corporation and S. S. Kresge Company. (8)
  10.53B    Second Amendment to Lease dated as of November 15, 1993, by and
              between Charles J. Fishback and KMart Corporation. (8)
  10.54     Sublease dated as of August 31, 1993, by and between KMart
              Corporation and Eagle Hardware & Garden, Inc. (8)
  10.54A    Amendment to Sublease dated as of November 18, 1993, by and among
              KMart Corporation and Eagle Hardware & Garden, Inc. (8)
  10.77     Lease dated July 11, 1994, by and between Harlan D. Douglass and
              Maxine H. Douglass and Eagle Hardware & Garden, Inc. (10)
  10.78     Lease dated January 9, 1995, by and between Harlan D. Douglass and
              Maxine H. Douglass and Eagle Hardware & Garden, Inc. (10)
  10.78A    First Amendment to Lease dated September 1, 1995, by and between
              Harlan D. Douglass and Maxine H. Douglass and Eagle Hardware &
              Garden, Inc. (11)
  10.79     Lease dated September 28, 1994, between The Northwestern Mutual
              Life Insurance Company and Eagle Hardware & Garden, Inc. (10)
  10.80     Promissory Note dated November 4, 1994, by Eagle Hardware & Garden,
              Inc. to The Prudential Insurance Company of America in the
              principal amount of $8,000,000. (10)
  10.94     Lease dated December 7, 1995, by and between KW, Ltd. and Eagle
              Hardware & Garden, Inc. (11)
  10.95     Promissory Note dated December 20, 1995, by Eagle Hardware &
              Garden, Inc. to PFL Life Insurance Company in the principal amount
              of $6,000,000. (11)
  10.97     Purchase and Sale Agreement dated January 30, 1996, by and between
              Chandelle Development, LLC, and Eagle Hardware & Garden, Inc. (11)
  10.98     Contract to Buy and Sell Real Estate dated February 12, 1996, by
              and between Alpha West Realty & Investments, Inc. and Eagle
              Hardware & Garden, Inc. (11)
  10.99     Retail Technology Exchange Agreement dated July 17, 1995, by and
              between Fujitsu-ICL Systems, Inc. and Eagle Hardware & Garden, 
              Inc. (11)
  10.99A    Supplement No. 101 and Supplement No. 102 under Retail Technology
              Exchange Agreement by and between Fujitsu-ICL Systems, Inc. and
              Eagle Hardware & Garden, Inc. (11)
  10.99B    Supplement No. 103 and Supplement No. 104 under Retail Technology
              Exchange Agreement by and between Fujitsu-ICL Systems, Inc. and
              Eagle Hardware & Garden, Inc. (13)
  10.102    Amended and Restated Credit Agreement dated as of May 28, 1996,
              between the Lenders, U.S. Bank of Washington, N.A., as Agent and
              Eagle Hardware & Garden, Inc. (12)
  10.102A   First Amendment to Amended and Restated Credit Agreement dated as
              of December 6, 1996, between the Lenders, U.S. Bank of Washington,
              N.A., as Agent and Eagle Hardware & Garden,  Inc. (14)
  10.102B   Second Amendment to Amended and Restated Credit Agreement dated as
              of October 20, 1997, between the Lenders, U.S. Bank of Washington,
              N.A., as Agent and Eagle Hardware & Garden, Inc. (17)

                                          21
<PAGE>


EXHIBIT
NUMBER      DESCRIPTION

  10.103    Real Estate Purchase and Sale Agreement dated July 2, 1996, by and
              between Terrace Point Partnership, Inc. and Eagle Hardware &
              Garden, Inc. (12)
  10.103A   First Amendment to Real Estate Purchase and Sale Agreement dated
              August 1996, by and between Terrace Point Partnership, Inc. and
              Eagle Hardware & Garden, Inc. (13)
  10.103B   Second Amendment to Real Estate Purchase and Sale Agreement dated
              November 3, 1997, by and between Eagle Hardware & Garden, Inc. and
              Terrace Point Partnership.  (17)
  10.104    Promissory Note dated July 18, 1996, by Eagle Hardware & Garden,
              Inc. to The Northwestern Mutual Life Insurance Company in the
              principal amount of $9,000,000. (12)
  10.105    Real Estate Purchase and Sale Agreements dated August 4, 1994 and
              amended December 1, 1994, August 30, 1995 and February 23, 1996
              between Atlantic Seaboard Realty and the following persons:  
              Ronald V. and Kathleen A. Gratias; Chlo Elaine Jackson and 
              Charles L. Betts; and Mary J. McColm. (12)
  10.106    Assignment of Rights Under Real Estate Purchase and Sale Agreements
              dated August 4, 1994, as amended, by Atlantic Seaboard Realty to
              Eagle Hardware & Garden, Inc. (12)
  10.107    Real Estate Purchase and Sale Agreement dated March 6, 1996 and
              amended March 31, 1996, between Atlantic Seaboard Realty and the
              Tacoma Alliance Church. (12)
  10.108    Assignment of Rights Under Real Estate Purchase and Sale Agreement
              dated March 6, 1996, as amended, by Atlantic Seaboard Realty to
              Eagle Hardware & Garden, Inc. (12)
  10.109    Real Estate Purchase and Sale Agreement dated April 1, 1996, by and
              between Metropolitan Park District of Tacoma and Wahl & 
              Associates, Inc. (12)
  10.110    Assignment of Rights Under Real Estate Purchase and Sale Agreement
              dated April 1, 1996, by Wahl & Associates, Inc. to Eagle 
              Hardware & Garden, Inc. (12)
  10.111    Employment and Severance Agreement between Eagle Hardware & Garden,
              Inc. and Ronald P. Maccarone. (12)
  10.114    Stipulation and Order of Appropriation and Judgment by the Superior
              Court of Washington for Snohomish County dated September 24, 1996.
              (13)
  10.115    Real Estate Purchase and Sale Agreement dated March 12, 1997, by
              and between Washington- 111, Ltd. and Eagle Hardware & Garden, 
              Inc. (14)
  10.116    Purchase Agreement dated March 18, 1997, between David J.
              Heerensperger and Eagle Hardware & Garden, Inc. (14)
  10.117    Promissory Note dated April 2, 1997, by Eagle Hardware & Garden,
              Inc. to The Northwestern Mutual Life Insurance Company in the
              principal amount of $10,000,000. (15)
  10.118    Agreement to Lease dated April 30, 1997, between Tigard-Tualatin
              School District 23J and Eagle Hardware & Garden, Inc. (15)
  10.118A   Extension Agreement dated August 30, 1997 for Agreement to Lease
              and Put to Lease, between Tigard-Tualatin School District 23J and
              Eagle Hardware & Garden, Inc. (17)
  10.119    Put to Lease Property dated April 30, 1997, from Eagle Hardware &
              Garden, Inc. to Tigard- Tualatin School District 23J. (15)
  10.120    Real Estate Purchase and Sale Agreement dated June 18, 1997,
              between Kent Central, L.L.C.  and Eagle Hardware & Garden, Inc. 
              (16)
  10.120A   Termination Agreement dated January 30, 1998, by and between Kent
              Central L.L.C. and Eagle Hardware & Garden Distribution Services,
              Inc.  
  10.121    Real Estate Purchase and Sale Agreement dated June 24, 1997, by and
              between Havana Street Partnership and Frank V. Furstenberg and
              Eagle Hardware & Garden, Inc. (16)
  10.123    Promissory Note dated June 30, 1997, by Eagle Hardware & Garden,
              Inc. to The Northwestern Mutual Life Insurance Company in the
              principal amount of $10,000,000. (16)

                                          22
<PAGE>

EXHIBIT
NUMBER      DESCRIPTION
  
  10.124    Real Estate Purchase and Sale Agreement dated August 4, 1997, by
              and between Johnson Properties, Inc. and Eagle Hardware & Garden,
              Inc. (16)
  10.125    Real Estate Purchase and Sale Agreement dated August 11, 1997, by
              and between Alex Madonna and Phyllis Madonna and Eagle Hardware &
              Garden, Inc. (16)
  10.126    Purchase Agreement and Joint Escrow Instructions dated October 16,
              1997, by and between Hilton Hotels Corporation and Eagle Hardware 
              & Garden, Inc. (17)
  10.127    Promissory Note dated October 17, 1997,  by Eagle Hardware &
              Garden, Inc. to KeyBank National Association in the principal
              amount of $11,000,000. (17)
  10.127A   Amendment to Promissory Note dated November 1, 1997, by Eagle
              Hardware & Garden, Inc. to KeyBank National Association. (17)
  10.128    Promissory Note dated October 17, 1997,  by Eagle Hardware &
              Garden, Inc. to KeyBank National Association in the principal
              amount of $8,000,000. (17) 
  10.128A   Amendment to Promissory Note dated November 1, 1997, by Eagle
              Hardware & Garden, Inc. to KeyBank National Association. (17)
  10.129    Promissory Note dated October 17, 1997,  by Eagle Hardware &
              Garden, Inc. to KeyBank National Association in the principal
              amount of $6,000,000. (17)
  10.129A   Amendment to Promissory Note dated November 1, 1997, by Eagle
              Hardware & Garden, Inc. to KeyBank National Association. (17)
  10.130    Real Estate Purchase and Sale Agreement dated October 20, 1997 by
              and between CFJ Properties and Eagle Hardware & Garden, Inc. (17)
  10.131    Real Estate Purchase and Sale Agreement dated November 12, 1997 by
              and between Waterman Properties, L.P. and Eagle Hardware & Garden,
              Inc. (17)
  10.132    Real Estate Purchase and Sale Agreement dated November 14, 1997 by
              and between La Caze Development Company and Eagle Hardware &
              Garden, Inc. (17)
  10.133    Build to Suit Warehouse and Distribution Center Lease dated June
              18, 1997 between Kent Central, L.L.C. and Eagle Hardware & Garden
              Distribution Services, Inc.  
  10.133A   Amendment No. 1 to Build to Suit Warehouse and Distribution Center
              Lease dated February 9, 1998, by and between Kent Central, L.L.C.
              and Eagle Hardware & Garden Distribution Services, Inc.  
  10.134    Lease dated December 5, 1997, by and between Harlan D. Douglass and
              Maxine H. Douglass and Eagle Hardware & Garden, Inc.  
  10.135    Real Estate Purchase and Sale Agreement dated February 12, 1998, by
              and between Front Range Limited Partnership and Eagle Hardware &
              Garden, Inc. 
  10.136    Agreement of Purchase and Sale and Joint Escrow Instructions dated
              February 26, 1998, by and between Lennar Rolling Ridge, Inc. and
              Eagle Hardware & Garden, Inc.  
  10.137    Ground Lease dated March 5, 1998 by and between FF Properties, L.P.
              and Eagle Hardware & Garden, Inc.  
  10.138    Real Estate Purchase and Sale Agreement dated March 17, 1998 by and
              between Hopkins Real Estate Group and Eagle Hardware & Garden, 
              Inc.
  10.139    Eagle Hardware & Garden, Inc. Employee Stock Purchase Plan.
  13.1      Portions of Registrant's Annual Report to Shareholders (pages 15
              through 35 and inside back cover) for the fiscal year ended 
              January 30, 1998.
  23.1      Consent of Ernst & Young LLP, Independent Auditors.
  27.1      Financial Data Schedule
  27.2      Financial Data Schedule
  27.3      Financial Data Schedule

                                          23
<PAGE>

--------------------
(1)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Registration Statement No. 33-48593 on 
        Form S-1.
(2)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Registration Statement No. 33-48593 on Form S-1
        with confidential portions omitted and filed separately with the
        Commission pursuant to a Request for Confidential Treatment under Rule
        406 of the Securities Act of 1933.
(3)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Registration Statement No. 33-60148 on 
        Form S-1.
(4)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Registration Statement No. 33-60148 on Form S-1
        with confidential portions omitted and filed separately with the
        Commission pursuant to a Request for Confidential Treatment under Rule
        406 of the Securities Act of 1933.
(5)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Amended Registration Statement No. 33-60148 on
        Amendment No. 1 to Form S-1.
(6)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Amended Registration Statement No. 33-60148 on
        Amendment No. 1 to Form S-1 with confidential portions omitted and filed
        separately with the Commission pursuant to a Request for Confidential
        Treatment under Rule 406 of the Securities Act of 1933.
(7)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to a Current Report on Form 8-K, filed with the Commission on
        March 10, 1994.
(8)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-K filed with the Commission for the
        fiscal year ended January 28, 1994.
(9)   Exhibit is incorporated herein by reference to an identically numbered
        exhibit to a Current Report on Form 8-K/A filed with the Commission on
        December 30, 1994.
(10)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-K filed with the Commission for the
        fiscal year ended January 27, 1995.
(11)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-K filed with the Commission for the
        fiscal year ended January 26, 1996.
(12)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-Q filed with the Commission for the
        fiscal quarter ended July 26, 1996.
(13)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-Q filed with the Commission for the
        fiscal quarter ended October 25, 1996.
(14)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-K filed with the Commission for the
        fiscal quarter ended January 31, 1997.
(15)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-Q filed with the Commission for the
        fiscal quarter ended May 2, 1997.
(16)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-Q filed with the Commission for the
        fiscal quarter ended August 1, 1997.
(17)  Exhibit is incorporated herein by reference to an identically numbered
        exhibit to the Company's Form 10-Q filed with the Commission for the
        fiscal quarter ended October 31, 1997.

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

(b)  No reports on Form 8-K were filed in the fourth quarter of fiscal 1997.

                                          24
<PAGE>

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, Eagle Hardware & Garden, Inc. has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized, on April 6,
1998.


                              EAGLE HARDWARE & GARDEN, INC.


                              By: /s/  David J. Heerensperger
                                 David J. Heerensperger
                                 CHAIRMAN 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on April 6, 1998, on behalf of
the Registrant and in the capacities indicated.  


            SIGNATURE                                 TITLE 



     /s/  David J. Heerensperger        Chairman
-----------------------------------
     David J. Heerensperger

     /s/  Richard T. Takata             President, Chief Executive Officer
-----------------------------------     (Principal Executive Officer), 
     Richard T. Takata                  Chief Operating Officer and Director


     /s/  Ronald P. Maccarone           Chief Financial Officer
-----------------------------------
     Ronald P. Maccarone


     /s/  Ronald D. Crockett            Director
-----------------------------------
     Ronald D. Crockett


     /s/  Harlan D. Douglass            Director
-----------------------------------
     Harlan D. Douglass


     /s/  Herman Sarkowsky              Director
-----------------------------------
     Herman Sarkowsky


     /s/  Theodore M. Wight             Director
-----------------------------------
     Theodore M. Wight

                                          25
<PAGE>

