1 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 1, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File Number 0-21768 D.I.Y. Home Warehouse, Inc. --------------------------- (Exact name of registrant as specified in its charter) State of Ohio 38-2560752 (State of Incorporation) (I.R.S. Employer I.D. No.) 5811 Canal Road Valley View, Ohio 44125 (216) 328-5100 (Address of principal executive offices and telephone number) 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 the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding at April 1, 2000 - -------------------------- ---------------------------- Common Stock, no par value 7,276,059 2 D.I.Y. HOME WAREHOUSE, INC. INDEX PAGE NO. ----- -------- PART I FINANCIAL INFORMATION Item 1. Financial Statements Condensed Balance Sheet - April 1, 2000 and January 1, 2000....................... 3 Condensed Statement of Operations - Three Months Ended April 1, 2000 and April 3, 1999...... 4 Condensed Statement of Stockholders' Equity - Three Months Ended April 1, 2000............... 5 Condensed Statement of Cash Flows - Three Months Ended April 1, 2000 and April 3, 1999...... 6 Notes to Condensed Financial Statements................. 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations........ 8 - 11 PART II OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K........................ 12 - 21 2 3 PART I - FINANCIAL INFORMATION D.I.Y. HOME WAREHOUSE, INC. CONDENSED BALANCE SHEET April 1, 2000 January 1, 2000 ------------- ---------------- Assets (Unaudited) Current assets: Cash and cash equivalents $ 488,831 $ 309,349 Refundable federal income taxes 606,170 606,170 Merchandise inventories 29,383,163 24,084,280 Deferred income taxes 1,607,032 1,636,875 Prepaid expenses and other assets 830,354 936,087 ------------ ------------ Total current assets 32,915,550 27,572,761 Property and equipment, at cost 39,183,451 39,178,327 Less accumulated depreciation and amortization 15,807,400 15,142,429 ------------ ------------ Property and equipment, net 23,376,051 24,035,898 Other assets 175,091 196,437 ------------ ------------ Total assets $ 56,466,692 $ 51,805,096 ============ ============ Liabilities and Shareholders' Equity Current liabilities: Current maturities of long-term debt $ 188,900 $ 188,900 Accounts payable 7,446,073 4,572,801 Accrued expenses and other 1,725,638 2,763,431 ------------ ------------ Total current liabilities 9,360,611 7,525,132 Revolving credit 9,306,180 5,310,031 Long-term debt 53,899 100,055 Deferred income taxes 2,862,798 2,862,798 ------------ ------------ Total liabilities 21,583,488 15,798,016 Shareholders' equity: Preferred stock, authorized 1,000,000 shares, none issued -- -- Common stock, no par value, 10,000,000 authorized shares, 7,633,859 shares issued as of April 1, 2000 and January 1, 2000 22,955,462 22,955,462 Retained earnings 12,129,183 13,253,059 Treasury stock, 357,800 shares at cost (201,441) (201,441) ------------ ------------ Total shareholders' equity 34,883,204 36,007,080 ------------ ------------ Total liabilities and shareholders' equity $ 56,466,692 $ 51,805,096 ============ ============ See accompanying notes to condensed financial statements. 3 4 D.I.Y. HOME WAREHOUSE, INC. CONDENSED STATEMENT OF OPERATIONS (Unaudited) For the three months ended April 1, 2000 April 3, 1999 ------------- ------------- Net sales $ 17,129,388 $ 29,162,507 Cost of sales 12,052,994 20,752,216 ------------ ------------ Gross profit 5,076,394 8,410,291 Store operating, general and administrative expenses 6,752,828 9,060,924 Store closing costs -- 259,656 ------------ ------------ Operating loss (1,676,434) (910,289) Other expense, net 177,875 332,080 ------------ ------------ Loss before income taxes (1,854,309) (1,242,369) Income tax benefit (730,433) (509,364) ------------ ------------ Net loss $ (1,123,876) $ (733,005) ============ ============ Loss per common share, basic and diluted $ (0.15) $ (0.10) ============ ============ Weighted average common shares outstanding, basic and diluted 7,276,059 7,276,059 ============ ============ See accompanying notes to condensed financial statements. 4 5 D.I.Y. HOME WAREHOUSE, INC. CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY FOR THE THREE MONTHS ENDED APRIL 1, 2000 (Unaudited) Common Stock Retained Treasury Stockholders' Shares Amount Earnings Stock Equity ------------ ------------ ------------ ------------ ------------ Balances, January 1, 2000 7,276,059 $ 22,955,462 $ 13,253,059 $ (201,441) $ 36,007,080 Net loss (1,123,876) (1,123,876) ------------ ------------ ------------ ------------ ------------ Balances, April 1, 2000 7,276,059 $ 22,955,462 $ 12,129,183 $ (201,441) $ 34,883,204 ============ ============ ============ ============ ============ See accompanying notes to condensed financial statements. 5 6 D.I.Y. HOME WAREHOUSE, INC. CONDENSED STATEMENT OF CASH FLOWS (Unaudited) For the three months ended April 1, 2000 April 3, 1999 ------------- ------------- Cash flows from operating activities: Net loss $(1,123,876) $ (733,005) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 664,971 884,297 Deferred income tax 29,843 -- Changes in operating assets and liabilities: Merchandise inventories (5,298,883) (7,779,309) Prepaid expenses and other assets 127,079 (53,615) Accounts payable 2,873,272 4,656,722 Accrued expenses and other current liabilities (1,037,793) (1,397,845) ----------- ----------- Net cash used in operating activities (3,765,387) (4,422,755) ----------- ----------- Cash flows from investing activities: Acquisition of property and equipment (5,124) (153,187) ----------- ----------- Net cash used in investing activities (5,124) (153,187) ----------- ----------- Cash flows from financing activities: Principal payments under capital lease obligations (46,156) (45,421) Proceeds from revolving credit 3,996,149 5,367,409 Principal payments of long-term debt -- (359,464) ----------- ----------- Net cash provided by financing activities 3,949,993 4,962,524 ----------- ----------- Net increase in cash and cash equivalents 179,482 386,582 Cash and cash equivalents, beginning of period 309,349 128,149 ----------- ----------- Cash and cash equivalents, end of period $ 488,831 $ 514,731 =========== =========== See accompanying notes to condensed financial statements. 6 7 D.I.Y. HOME WAREHOUSE, INC. Notes to Condensed Financial Statements (Unaudited) 1. Basis of Presentation: In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position as of April 1, 2000 and the results of operations and cash flows for the three months ended April 1, 2000 and April 3, 1999. The condensed financial statements should be read in conjunction with the financial statements and notes contained in the Company's Annual Report filed on Form 10-K. The results of operations for any interim period should not necessarily be considered indicative of the results of operations for the full year. 2. Earnings Per Share: Earnings per share have been computed according to Financial Accounting Standards Board's Statement of Financial Accounting Standards No. 128, "Earnings Per Share" as follows: COMPUTATION OF EARNINGS PER COMMON SHARE (BASIC AND DILUTED) Three Months Ended April 1, 2000 April 3, 1999 -------------- ------------- (Unaudited) Net loss applicable to common shares $ (1,123,876) $ (733,005) ============ =========== Weighted average common shares outstanding, basic 7,276,059 7,276,059 Dilutive effect of stock options -- -- ------------ ----------- Weighted average common shares outstanding, diluted 7,276,059 7,276,059 ============ =========== Loss per common share: Basic $ (0.15) $ (0.10) ============ =========== Diluted $ (0.15) $ (0.10) ============ =========== Options to purchase 809,500 shares of common stock at a weighted average exercise price of $3.078 per share were outstanding at April 1, 2000 but were not included in the computation of diluted earnings per share for the three months then ended because the options would have an anti-dilutive effect on the net loss for the period. 7 8 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OPERATIONS - Three Months Ended April 1, 2000 Compared to Three Months Ended April 3, 1999 Net sales for the first quarter ended April 1, 2000 decreased $12,033,000 or 41.3% to $17,129,000 from $29,163,000 during the first quarter ended April 3, 1999. Continuing store net sales, which excludes the operations of the closed stores from the fiscal year 1999 results, decreased $7,406,000 or 30.2% between the first quarter ended April 1, 2000 and the same period a year ago. The decrease in continuing store net sales between the two periods was the result of additional competition from national warehouse retailers in the Company's markets. The Company anticipates that net sales for the remainder of fiscal year 2000 will be below the net sales recorded during the same periods in the prior year. Gross profit decreased by $3,334,000 or 39.6% to $5,076,000 during the first quarter ended April 1, 2000 from $8,410,000 during the same period a year ago. Continuing store gross profit, which excludes the operations of the closed stores from the fiscal year 1999 results, decreased $2,209,000 or 30.3% during the first quarter ended April 1, 2000 from comparable results recorded during the first quarter ended April 3, 1999. The decrease in continuing store gross margin was due to reduced continuing store sales volumes, evidenced by the fact that the continuing store gross profit percentage for the first quarter ended April 1, 2000 was 29.6% in comparison to the 29.7% continuing store gross profit percentage recognized during the first quarter ended April 3, 1999. The Company anticipates that the gross profit percentage for the remainder of fiscal year 2000 will be comparable with the gross profit percentage experienced during fiscal year 1999. Store operating, general and administrative expenses decreased $2,308,000 or 25.5% to $6,753,000 during the first quarter ended April 1, 2000 from $9,061,000 during the first quarter ended April 3, 1999. Continuing store operating, general and administrative expenses, which excludes the operations of the closed stores from the fiscal year 1999 results, decreased $861,000 during the first quarter ended April 1, 2000 from comparable results recorded during the same period a year ago. The decrease in continuing stores operating, general and administrative expenses reflects the Company's continued management of controllable expenses. This management of controllable expenses included lower personnel costs resulting from reduced store and corporate staffing levels, decreased advertising expenditures, a reduction in the utilization of outside services and an overall reduction in general operating expenses. The Company anticipates that store operating, general and administrative expenses for the remainder of fiscal year 2000 will be below the store operating, general and administrative expenses recorded during fiscal year 1999. 8 9 During the first quarter ended April 3, 1999, the Company incurred approximately $260,000 in store closing costs related to the two store closure announced during the fourth quarter of fiscal 1998. Other expense, net, decreased $154,000 to $178,000 during the first quarter ended April 1, 2000 from $332,000 for the first quarter ended April 3, 1999. The decrease in other expense, net was due primarily to the reduction in interest expense associated with the extinguishment of the Company's mortgage loans during the second quarter of fiscal 1999. LIQUIDITY AND CAPITAL RESOURCES The Company's net use of cash from operating activities decreased $657,000 to $3,765,000 during the first quarter ended April 1, 2000 from $4,423,000 during the quarter ended April 3, 1999. The decrease in the Company's net use of cash from operating activities between the two periods was due primarily to a smaller seasonal increase in merchandise inventories during the current quarter, partially offset by the cash flow impact of the change in accounts payable and the increase in the net loss recorded during the first quarter ended April 1, 2000. The current quarter's smaller seasonal increase in merchandise inventories resulted from operating fewer stores at lower sales volumes during fiscal year 2000. The $148,000 decrease in the Company's net use of cash in investing activities was due primarily to the absence, in the current quarter, of $153,000 in expenditures for computer hardware and software recorded during the first quarter ended April 3, 1999. The Company's net cash provided by financing activities decreased $1,013,000 to $3,950,000 during the first quarter ended April 1, 2000 from $4,963,000 during the first quarter ended April 3, 1999. The decrease in the Company's net cash provided by financing activities between the two periods reflects the reduction in net borrowings under the revolving credit facility required to fund the smaller seasonal increase in merchandise inventories experienced during the first quarter ended April 1, 2000. The reduced net borrowings under the revolving credit facility were partially offset by the absence, in the current quarter, of mortgage loan payments made during the first quarter ended April 3, 1999. Total current and long-term debt amounted to $9,549,000 at April 1, 2000 in comparison to $21,124,000 at April 3, 1999. Management believes that cash on hand, cash from operations and cash available through the Company's financing agreements will be sufficient to meet short-term and long-term working capital requirements. FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q may contain statements that are forward-looking, as that term is defined by the Private Securities Litigation Reform Act of 1995 or by the Securities and Exchange Commission in its rules, regulations and releases. The Company intends that such 9 10 forward-looking statements be subject to the safe harbors created thereby. All forward-looking statements are based on current expectations regarding important risk factors. Accordingly, actual results may differ materially from those expressed in the forward-looking statements and the making of such statements should not be regarded as a representation by the Company or any other person that the results expressed therein will be achieved. Important risk factors include, but are not limited to, the following: general economic conditions; consumer spending and debt levels; housing turnover; weather; impact on sales and margins from both existing and new competition; changes in operating expenses; changes in product mix; interest rates; changes in and the application of accounting policies and practices; adverse results in significant litigation matters; adverse state and federal regulations and legislation; the occurrence of extraordinary events including events and acts of nature or accidents; and the risks described from time to time in the Company's Securities and Exchange Commission filings. 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 many of the Company's competitors have substantially greater resources than the Company. Builders Square and Lowe's Company have had stores in the Company's markets since fiscal years 1985 and 1994, respectively. However, Builders Square exited the Northeastern Ohio marketplace during fiscal year 1999. Lowe's has continued to expand, opening additional locations in fiscal years 1996, 1997, 1998 and 2000. Beginning in the fourth quarter of fiscal year 1997 and continuing into fiscal year 2000, Home Depot has opened operations in several of the Company's markets. Both Home Depot and Lowe's have announced further expansion plans for the remainder of fiscal year 2000. In addition, there has been increasing consolidation within the home improvement industry, which may provide certain entities increased competitive advantages. Specifically, increased competition including, but not limited to, additional competitors' store locations, price reductions, and advertising and marketing campaigns could have a material adverse effect on the Company's business. Year 2000 Issue BACKGROUND. Some computers, software, and other equipment include programming code in which calendar year data is abbreviated to only two digits. As a result of this design decision, some of these systems could fail to operate or fail to produce correct results if "00" is interpreted to mean 1900, rather than 2000. These problems were widely expected to increase in frequency and severity into and beyond 2000, and are commonly referred to as the "Millennium Bug" or "Year 2000 Problem." ASSESSMENT. The Company completed its review of its internal computer programs and systems prior to January 1, 2000 to ensure that the programs and systems would be Year 2000 compliant. Upon entering the 2000 calendar year, the Company did not encounter any significant Year 2000 problems and has been able to operate its business in the normal course without interruption. Additionally, the Company does not anticipate encountering any significant Year 10 11 2000 issues with its internal computer programs and systems as it continues to operate during the 2000 calendar year and beyond. The Company incurred approximately $400,000 to complete its Year 2000 efforts and does not anticipate incurring any additional expenditures related to Year 2000 issues. INTERNAL INFRASTRUCTURE. The Company believes that it identified and subsequently modified, upgraded or replaced substantially all of the major computers, software applications, and related equipment used in connection with its internal operations prior to January 1, 2000 to ensure that there would be no material disruption to its business. Upon entering the 2000 calendar year, the Company did not encounter any significant Year 2000 problems with its internal infrastructure and has been able to operate its business in the normal course without interruption. Additionally, the Company does not anticipate encountering any significant Year 2000 issues with its internal infrastructure as it continues to operate during the 2000 calendar year and beyond. As such, the Company does not anticipate incurring any additional expenditures related to Year 2000 issues. SYSTEMS OTHER THAN INFORMATION TECHNOLOGY SYSTEMS. In addition to computers and related systems, the operation of office and facilities equipment, such as fax machines, photocopiers, telephone switches, security systems, and other common devices may be affected by the Year 2000 Problem. Upon entering the 2000 calendar year, the Company did not experience any significant Year 2000 problems with its office and facilities equipment and has been able to operate its business in the normal course without interruption. Additionally, the Company does not anticipate encountering any significant Year 2000 problems with its office and facilities equipment as it continues to operate during the 2000 calendar year and beyond. The Company did not incur any material costs to address Year 2000 issues in its office and facilities equipment and doe not anticipate incurring any additional expenditures related to Year 2000 issues. SUPPLIERS. The Company communicated with third party suppliers of the major computers, software, and other equipment used, operated, or maintained by the Company prior to January 1, 2000 and identified and, where necessary, resolved issues involving the Year 2000 Problem. Upon entering the 2000 calendar year, the Company did not experience any significant Year 2000 problems with these third party suppliers and has been able to operate its business in the normal course without interruption. Additionally, the Company does not anticipate encountering any significant Year 2000 issues with these third party suppliers as it continues to operate during the 2000 calendar year and beyond. Based on the procedures completed by the Company prior to January 1, 2000 and the absence of any significant Year 2000 problems since entering the 2000 calendar year, the Company does not foresee any significant risks associated with its Year 2000 compliance at this time. As such, the Company will continue to operate without developing a comprehensive contingency plan as it is deemed to be unnecessary. 11 12 PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K -------------------------------- (a) Exhibits required by Item 601 of Regulation S-K: 3.1 Articles of Incorporation of D.I.Y. Home Warehouse, Inc., as amended, incorporated herein by reference to Exhibit 3.1 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 3.2 Amended and Restated Code of Regulations of D.I.Y. Home Warehouse, Inc., incorporated herein by reference to Exhibit 3.2 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1 Compensation and Employee Benefit Plans of the Registrant 10.1.1 D.I.Y. Home Warehouse, Inc. 1993 Long Term Incentive Plan as Amended February 23, 1994 and Approved by Stockholders May 25, 1994, incorporated herein by reference to Exhibit 10.18 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.2 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and Clifford L. Reynolds, incorporated herein by reference to Exhibit 10.22 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.3 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and R. Scott Eynon, incorporated herein by reference to Exhibit 10.23 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.4 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and Dennis C. Hoff, incorporated herein by reference to Exhibit 10.24 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.5 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and John M. Erb, incorporated herein by reference to Exhibit 10.25 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.6 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and Fred A. Erb, incorporated herein by reference to Exhibit 10.26 to the 12 13 Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.7 Tax Indemnification Agreement among D.I.Y. Home Warehouse, Inc. and Fred A. Erb, Clifford L. Reynolds, R. Scott Eynon, Dennis C. Hoff and John M. Erb, incorporated herein by reference to Exhibit 10.27 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.8 D.I.Y. Home Warehouse, Inc.'s 401K Plan, incorporated herein by reference to Exhibit 10.28 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1.9 1994 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan dated May 25, 1994, incorporated herein by reference to Exhibit 10.48 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. 10.1.10 Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated January 1, 1995, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended July 1, 1995. 10.1.10.a Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated November 21, 1996, incorporated herein by reference to Exhibit 10.51 to the Registrant's Report on Form 10-K for the fiscal year ended December 28, 1996. 10.1.10.b Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated May 28, 1998, incorporated herein by reference to Exhibit 10.4 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.10.c Amendment No. 3 to Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated March 11, 1999, incorporated herein by reference to Exhibit 10.69 to the Registrant's Report on Form 10-K for the fiscal year ended January 2, 1999. 10.1.10.d Amendment No. 4 to Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated November 30, 1999, incorporated herein by reference to Exhibit 10.1.10.d to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. 10.1.11 Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated 13 14 January 1, 1995, incorporated herein by reference to Exhibit 10.2 to the Registrant's Report on Form 10-Q for the quarter ended July 1, 1995. 10.1.11.a Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated May 28, 1998, incorporated herein by reference to Exhibit 10.5 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.11.b Amendment No. 2 to Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated March 11, 1999, incorporated herein by reference to Exhibit 10.70 to the Registrant's Report on Form 10-K for the fiscal year ended January 2, 1999. 10.1.11.c Amendment No. 3 to Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated November 30, 1999, incorporated herein by reference to Exhibit 10.1.11.c to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. 10.1.12 Amended and Restated Employment Agreement between Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated January 1, 1995, incorporated herein by reference to Exhibit 10.3 to the Registrant's Report on Form 10-Q for the quarter ended July 1, 1995. 10.1.12.a Amended and Restated Employment Agreement between Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated May 28, 1998, incorporated herein by reference to Exhibit 10.6 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.13 Form of Non-Qualified Stock Option Agreement under the D.I.Y. Home Warehouse, Inc. 1993 Long Term Incentive Plan as Amended, incorporated herein by reference to Exhibit 10.14 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 10.1.14 1995 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan dated May 24, 1995, incorporated herein by reference to Exhibit 10.44 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 10.1.15 D.I.Y. Home Warehouse, Inc. 1996 Retainer Stock Plan for Non-Employee Directors, incorporated herein by reference to Exhibit 10.49 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 14 15 10.1.16 Employment Agreement between Eric I. Glassman and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.7 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.17 Transaction Bonus Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.8 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.18 Transaction Bonus Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.9 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.19 Transaction Bonus Agreement between Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.10 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.20 Transaction Bonus Agreement between Eric I. Glassman and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.11 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.1.21 Amendment No. 1 to Amended and Restated Employment Agreement between Eric I. Glassman and D.I.Y. Home Warehouse, Inc. dated March 11, 1999, incorporated herein by reference to Exhibit 10.71 to the Registrant's Report on Form 10-K for the fiscal year ended January 2, 1999. 10.1.22 DIY Home Warehouse, Inc. 1993 Long Term Incentive Plan as Amended March 17, 1999 and Approved by the Board of Directors March 17, 1999, incorporated herein by reference to Exhibit 10.13 to the Registrant's Report on Form 10-Q for the quarter ended July 3, 1999. 10.2 Material Leases of the Registrant 10.2.1 Sublease between D.I.Y. Ohio Real Estate Associates Limited Partnership and D.I.Y. Home Warehouse, Inc., dated August 1, 1992, incorporated herein by reference to Exhibit 10.1 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.2 Indenture of Lease between Smith - D.I.Y. Center Limited Partnership and D.I.Y. Home Warehouse, Inc., dated December 27, 1985, 15 16 incorporated herein by reference to Exhibit 10.2 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.3 Amendment to Lease between D.I.Y. Center Associates (successor in interest to Smith - D.I.Y. Center Limited Partnership) and D.I.Y. Home Warehouse, Inc., dated July 2, 1991, incorporated herein by reference to Exhibit 10.3 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.3.a Amendment to Lease between D.I.Y. Center Associates, L.P. and D.I.Y. Home Warehouse, Inc. dated March 21, 1995, incorporated herein by reference to Exhibit 10.51 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. 10.2.4 Lease between Fred A. Erb and D.I.Y. Home Warehouse, Inc., dated March 1, 1993, incorporated herein by reference to Exhibit 10.4 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.5 Lease Agreement between West Park Limited, Inc. and D.I.Y. Home Warehouse, Inc. dated August 2, 1991, incorporated herein by reference to Exhibit 10.5 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.5.a Addendum #1 to Lease Agreement between West Park Limited, Inc. and D.I.Y. Home Warehouse, Inc., dated September 2, 1991, incorporated herein by reference to Exhibit 10.6 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.5.b Addendum #2 to Lease Agreement between West Park Limited, Inc. and D.I.Y. Home Warehouse, Inc., dated September 16, 1991, incorporated herein by reference to Exhibit 10.7 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.6 Sublease between The Wholesale Club, Inc. and D.I.Y. Home Warehouse, Inc., dated May 14, 1992, incorporated herein by reference to Exhibit 10.8 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.7 Sublease between The Wholesale Club, Inc. and D.I.Y. Home Warehouse, Inc., dated November 25, 1992, incorporated herein by reference to Exhibit 10.9 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.2.8 Lease between Myron S. Viny, dba Central Valley Properties, and D.I.Y. Home Warehouse, Inc., dated February 26, 1993, but effective beginning May 1, 1993, incorporated herein by reference to Exhibit 10.12 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 16 17 10.2.8.a Modification and Supplement to lease between the Estate of Myron S. Viny (formerly DBA Central Valley Properties) and D.I.Y. Home Warehouse, Inc. dated November 27, 1995, incorporated herein by reference to Exhibit 10.12 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 10.2.8.b Modification and Supplement of lease between the Estate of Myron S. Viny (formerly DBA Central Valley Properties) and D.I.Y. Home Warehouse, Inc. dated March 30, 2000, filed herewith. 10.2.9 Agreement of Lease (Boardman Facility) between DIY Ohio Real Estate Associates Limited Partnership and D.I.Y. Home Warehouse, Inc. dated as of October 1, 1993, incorporated herein by reference to Exhibit 10.38 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 1994. 10.2.9.a Second Amendment to Agreement Lease (Boardman facility) between D.I.Y. Home Warehouse, Inc. and D.I.Y. Ohio Real Estate Associated Limited Partnership (the Landlord) and assignment of the lease to V&V 224, Limited by the Landlord dated October 22, 1998, incorporated herein by reference to Exhibit 10.9 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.2.10 Lease between Elmhurst Properties, Inc. and D.I.Y. Home Warehouse, Inc., dated May 26, 1993, incorporated herein by reference to Exhibit 10.39 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 1994. 10.2.11 Assignment and Assumption of Lease and Sublease between Kmart Corporation and D.I.Y. Home Warehouse, Inc. dated December 22, 1994, incorporated herein by reference to Exhibit 10.49 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. 10.2.12 Shopping Center Lease between KCHGC, Inc. and D.I.Y. Home Warehouse, Inc. dated January 12, 1995, incorporated herein by reference to Exhibit 10.50 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. 10.3 Credit Agreements of the Registrant 10.3.1 $1,250,000 Promissory Note from D.I.Y. Home Warehouse, Inc. to Edgemere, Inc. f/k/a Erb Lumber Co., dated July 1, 1991, incorporated herein by reference to Exhibit 10.29 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.3.2 Security Agreement between D.I.Y. Home Warehouse and Erb Lumber Co., dated November 14, 1985, incorporated herein by reference to Exhibit 10.30 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 17 18 10.3.3 Revolving Credit Agreement and Security Agreement dated December 7, 1994 between D.I.Y. Home Warehouse, Inc. and National City Bank, Columbus, and Old Kent Bank and Trust Company, incorporated herein by reference to Exhibit 10.40 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. 10.3.4 Loan and Co-lender Agreement and Open-End Mortgage, Assignment of Rents and Security Agreement dated December 23, 1994 between D.I.Y. Home Warehouse, Inc. and National City Bank, Columbus, and Old Kent Bank and Trust Company, incorporated herein by reference to Exhibit 10.41 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. 10.3.4.a First Amendment to Loan and Co-Lender Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, incorporated herein by reference to Exhibit 10.41 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995 10.3.4.b Second Amendment to Loan and Co-Lender Agreement dated December 23, 1996 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.52 to the Registrant's Report on Form 10-K for the fiscal year ended December 28, 1996. 10.3.4.c Third Amendment to Loan and Co-Lender Agreement dated October 24, 1997 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.2 to the Registrant's Report on Form 10-Q for the quarter ended September 27, 1997. 10.3.4.d Fourth Amendment to Loan and Co-Lender Agreement dated April 4, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.2 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.3.4.e Fifth Amendment to Loan and Co-Lender Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.4 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.3.5 Line of Credit Agreement for Real Estate Loans, Open-end Mortgage, Assignment of Rents and Security Agreement, and Mortgage Notes between D.I.Y. Home Warehouse, Inc. and National City Bank, Columbus and Old Kent Bank dated April 28, 1995, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended April 1, 1995. 18 19 10.3.5.a First Amendment to Line of Credit Agreement; Open-end Mortgage, Assignment of Rents and Security Agreement (Leasehold) for Trumbull County; Open-end Mortgage, Assignment of Rents and Security Agreement for Summit County; Mortgage Note to National City Bank, Columbus dated September 15, 1995; Mortgage Note to Old Kent Bank dated September 15, 1995, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended September 30, 1995. 10.3.5.b Second Amendment to Line of Credit Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, incorporated herein by reference to Exhibit 10.39 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 10.3.5.c Third Amendment to Line of Credit Agreement Dated December 23, 1996 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.53 to the Registrant's Report on Form 10-K for the fiscal year ended December 28, 1996. 10.3.5.d Fourth Amendment to Line of Credit Agreement dated October 24, 1997 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.3 to the Registrant's Report on Form 10-Q for the quarter ended September 27, 1997. 10.3.5.e Fifth Amendment to Line of Credit Agreement dated April 4, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 10.3.5.f Sixth Amendment to Line of Credit Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.5 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.3.6 First Amendment to Security Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, incorporated herein by reference to Exhibit 10.38 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 10.3.7 First Amendment to Subordination Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, and Edgemere Enterprises, Inc., incorporated herein by reference to Exhibit 10.39 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 19 20 10.3.8 Partial Release of Mortgage to Open-End Mortgage Assignment of Rents and Security Agreement for Richland County, Stark County, Summit County, Trumball County and Medina County by Old Kent Bank dated October 28, 1998, incorporated herein by reference to Exhibit 10.6 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.3.9 Modification to Revolving Credit Agreement, Line of Credit Agreement, and Loan and Co-lender Agreement between D.I.Y. Home Warehouse, Inc., National City Bank, Columbus, and Old Kent Bank dated February 20, 1996, incorporated herein by reference to Exhibit 10.42 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 10.3.10 General Business Lease Agreement with IBM Credit Corporation dated May 30, 1996, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended June 29, 1996. 10.3.11 Amendment No. 1 to Open-End Mortgage, Assignment of Rents and Security Agreement for Richland County, Stark County, Summit County, Trumball County and Medina County between D.I.Y. Home Warehouse, Inc., National City Bank and Old Kent Bank dated October 28, 1998, incorporated herein by reference to Exhibit 10.7 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.3.12 First Amendment to Mortgage Note between D.I.Y. Home Warehouse, Inc. and National City Bank dated October 28, 1998, incorporated herein by reference to Exhibit 10.8 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.3.13 Second Amendment to Security Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank and Old Kent Bank, incorporated herein by reference to Exhibit 10.9 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.3.14 Second Amendment to Subordination Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank and Old Kent Bank, incorporated herein by reference to Exhibit 10.3 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.3.15 Credit and Security Agreement dated October 27, 1998 among D.I.Y. Home Warehouse, Inc. and the Lenders which are signatures hereto and National City Commercial Finance, Inc, as agent and National City Bank as Letter of Credit Bank, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 10.4 Real Estate Purchase Agreement (Mansfield) between DIY Ohio Real Estate Associates Limited Partnership and D.I.Y. Home Warehouse, Inc. dated as of 20 21 March 1, 1994, incorporated herein by reference to Exhibit 10.40 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 1994. 10.5 Real Estate Purchase Agreement (Mansfield and Canton) between D.I.Y. Home Warehouse, Inc. and Gabriel Brothers, Inc. dated March 3, 1999, incorporated herein by reference to Exhibit 10.5 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. 10.6 Sale of Merchandise Agreement (Mansfield and West Market) between D.I.Y Home Warehouse, Inc. and Schottenstein Bernstein Capital Group, LLC, dated June 3 1999, incorporated herein by reference to Exhibit 10.6 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. 10.7 Sale of Merchandise Agreement (Boardman) between D.I.Y Home Warehouse, Inc. and Schottenstein Bernstein Capital Group, LLC, dated June 11, 1999, incorporated herein by reference to Exhibit 10.7 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. 27.1 Financial Data Schedule for the first quarter ended April 1, 2000, filed herewith. (b) Reports on Form 8-K: During the first quarter of fiscal year 2000 to which this Quarterly Report on Form 10-Q relates, the Registrant filed the following Current Report on Form 8-K: Current Report bearing a cover date of April 12, 2000, attaching Registrant's press release of April 17, 2000, announcing the resignation of the Company's outside directors. 21 22 Signature Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. D.I.Y. HOME WAREHOUSE, INC. (Registrant) DATED: May 12, 2000 By: /s/ Todd Ayers -------------------------- Todd Ayers Controller 22 23 D.I.Y. Home Warehouse, Inc. Exhibits to Form 10-Q for the First Quarter Ended April 1, 2000 Index to Exhibits Where Filed ----- * 3.1 Articles of Incorporation of D.I.Y. Home Warehouse, Inc., as amended, incorporated herein by reference to Exhibit 3.1 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 3.2 Amended and Restated Code of Regulations of D.I.Y. Home Warehouse, Inc., incorporated herein by reference to Exhibit 3.2 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 10.1 Compensation and Employee Benefit Plans of the Registrant * 10.1.1 D.I.Y. Home Warehouse, Inc. 1993 Long Term Incentive Plan as Amended February 23, 1994 and Approved by Stockholders May 25, 1994, incorporated herein by reference to Exhibit 10.18 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.1.2 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and Clifford L. Reynolds, incorporated herein by reference to Exhibit 10.22 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.1.3 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and R. Scott Eynon, incorporated herein by reference to Exhibit 10.23 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.1.4 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and Dennis C. Hoff, incorporated herein by reference to Exhibit 10.24 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.1.5 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and John M. Erb, incorporated herein by reference to Exhibit 10.25 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. 24 * 10.1.6 Indemnification Agreement between D.I.Y. Home Warehouse, Inc. and Fred A. Erb, incorporated herein by reference to Exhibit 10.26 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.1.7 Tax Indemnification Agreement among D.I.Y. Home Warehouse, Inc. and Fred A. Erb, Clifford L. Reynolds, R. Scott Eynon, Dennis C. Hoff and John M. Erb, incorporated herein by reference to Exhibit 10.27 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.1.8 D.I.Y. Home Warehouse, Inc.'s 401K Plan, incorporated herein by reference to Exhibit 10.28 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.1.9 1994 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan dated May 25, 1994, incorporated herein by reference to Exhibit 10.48 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. * 10.1.10 Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated January 1, 1995, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended July 1, 1995. * 10.1.10.a Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated November 21, 1996, incorporated herein by reference to Exhibit 10.51 to the Registrant's Report on Form 10-K for the fiscal year ended December 28, 1996. * 10.1.10.b Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated May 28, 1998, incorporated herein by reference to Exhibit 10.4 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.10.c Amendment No. 3 to Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated March 11, 1999, incorporated herein by reference to Exhibit 10.69 to the Registrant's Report on Form 10-K for the fiscal year ended January 2, 1999. * 10.1.10.d Amendment No. 4 to Amended and Restated Employment Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated November 30, 1999, incorporated herein by reference to Exhibit 10.1.10.d to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. 25 * 10.1.11 Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated January 1, 1995, incorporated herein by reference to Exhibit 10.2 to the Registrant's Report on Form 10-Q for the quarter ended July 1, 1995. * 10.1.11.a Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated May 28, 1998, incorporated herein by reference to Exhibit 10.5 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.11.b Amendment No. 2 to Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated March 11, 1999, incorporated herein by reference to Exhibit 10.70 to the Registrant's Report on Form 10-K for the fiscal year ended January 2, 1999. * 10.1.11.c Amendment No. 3 to Amended and Restated Employment Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated November 30, 1999, incorporated herein by reference to Exhibit 10.1.11.c to the Registrant's Report on Form 10-k for the fiscal year ended January 1, 2000. * 10.1.12 Amended and Restated Employment Agreement between Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated January 1, 1995, incorporated herein by reference to Exhibit 10.3 to the Registrant's Report on Form 10-Q for the quarter ended July 1, 1995. * 10.1.12.a Amended and Restated Employment Agreement between Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated May 28, 1998, incorporated herein by reference to Exhibit 10.6 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.13 Form of Non-Qualified Stock Option Agreement under the D.I.Y. Home Warehouse, Inc. 1993 Long Term Incentive Plan as Amended, incorporated herein by reference to Exhibit 10.14 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. * 10.1.14 1995 D.I.Y. Home Warehouse, Inc. Employee Bonus Plan dated May 24, 1995, incorporated herein by reference to Exhibit 10.44 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. * 10.1.15 D.I.Y. Home Warehouse, Inc. 1996 Retainer Stock Plan for Non-Employee Directors, incorporated herein by reference to Exhibit 10.49 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. 26 * 10.1.16 Employment Agreement between Eric I. Glassman and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.7 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.17 Transaction Bonus Agreement between Clifford L. Reynolds and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.8 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.18 Transaction Bonus Agreement between R. Scott Eynon and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.9 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.19 Transaction Bonus Agreement between Dennis C. Hoff and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.10 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.20 Transaction Bonus Agreement between Eric I. Glassman and D.I.Y. Home Warehouse, Inc. dated July 1, 1998, incorporated herein by reference to Exhibit 10.11 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.1.21 Amendment No. 1 to Amended and Restated Employment Agreement between Eric I. Glassman and D.I.Y. Home Warehouse, Inc. dated March 11, 1999, incorporated herein by reference to Exhibit 10.71 to the Registrant's Report on Form 10-K for the fiscal year ended January 2, 1999. * 10.1.22 DIY Home Warehouse, Inc. 1993 Long Term Incentive Plan as Amended March 17, 1999 and Approved by the Board of Directors March 17, 1999, incorporated herein by reference to Exhibit 10.13 to the Registrant's Report on Form 10-Q for the quarter ended July 3, 1999. 10.2 Material Leases of the Registrant * 10.2.1 Sublease between D.I.Y. Ohio Real Estate Associates Limited Partnership and D.I.Y. Home Warehouse, Inc., dated August 1, 1992, incorporated herein by reference to Exhibit 10.1 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.2 Indenture of Lease between Smith - D.I.Y. Center Limited Partnership and D.I.Y. Home Warehouse, Inc., dated December 27, 1985, 27 incorporated herein by reference to Exhibit 10.2 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.3 Amendment to Lease between D.I.Y. Center Associates (successor in interest to Smith - D.I.Y. Center Limited Partnership) and D.I.Y. Home Warehouse, Inc., dated July 2, 1991, incorporated herein by reference to Exhibit 10.3 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.3.a Amendment to Lease between D.I.Y. Center Associates, L.P. and D.I.Y. Home Warehouse, Inc. dated March 21, 1995, incorporated herein by reference to Exhibit 10.51 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. * 10.2.4 Lease between Fred A. Erb and D.I.Y. Home Warehouse, Inc., dated March 1, 1993, incorporated herein by reference to Exhibit 10.4 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.5 Lease Agreement between West Park Limited, Inc. and D.I.Y. Home Warehouse, Inc. dated August 2, 1991, incorporated herein by reference to Exhibit 10.5 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.5.a Addendum #1 to Lease Agreement between West Park Limited, Inc. and D.I.Y. Home Warehouse, Inc., dated September 2, 1991, incorporated herein by reference to Exhibit 10.6 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.5.b Addendum #2 to Lease Agreement between West Park Limited, Inc. and D.I.Y. Home Warehouse, Inc., dated September 16, 1991, incorporated herein by reference to Exhibit 10.7 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.6 Sublease between The Wholesale Club, Inc. and D.I.Y. Home Warehouse, Inc., dated May 14, 1992, incorporated herein by reference to Exhibit 10.8 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.7 Sublease between The Wholesale Club, Inc. and D.I.Y. Home Warehouse, Inc., dated November 25, 1992, incorporated herein by reference to Exhibit 10.9 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.8 Lease between Myron S. Viny, dba Central Valley Properties, and D.I.Y. Home Warehouse, Inc., dated February 26, 1993, but effective beginning 28 May 1, 1993, incorporated herein by reference to Exhibit 10.12 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.2.8.a Modification and Supplement to lease between the Estate of Myron S. Viny (formerly DBA Central Valley Properties) and D.I.Y. Home Warehouse, Inc. dated November 27, 1995, incorporated herein by reference to Exhibit 10.12 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. ** 10.2.8.b Modification and Supplement of lease between the Estate of Myron S. Viny (formerly DBA Central Valley Properties) and D.I.Y. Home Warehouse, Inc. dated March 30, 2000, filed herewith. * 10.2.9 Agreement of Lease (Boardman Facility) between DIY Ohio Real Estate Associates Limited Partnership and D.I.Y. Home Warehouse, Inc. dated as of October 1, 1993, incorporated herein by reference to Exhibit 10.38 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 1994. * 10.2.9.a Second Amendment to Agreement Lease (Boardman facility) between D.I.Y. Home Warehouse, Inc. and D.I.Y. Ohio Real Estate Associated Limited Partnership (the Landlord) and assignment of the lease to V&V 224, Limited by the Landlord dated October 22, 1998, incorporated herein by reference to Exhibit 10.9 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.2.10 Lease between Elmhurst Properties, Inc. and D.I.Y. Home Warehouse, Inc., dated May 26, 1993, incorporated herein by reference to Exhibit 10.39 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 1994. * 10.2.11 Assignment and Assumption of Lease and Sublease between Kmart Corporation and D.I.Y. Home Warehouse, Inc. dated December 22, 1994, incorporated herein by reference to Exhibit 10.49 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. * 10.2.12 Shopping Center Lease between KCHGC, Inc. and D.I.Y. Home Warehouse, Inc. dated January 12, 1995, incorporated herein by reference to Exhibit 10.50 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. 10.3 Credit Agreements of the Registrant 29 * 10.3.1 $1,250,000 Promissory Note from D.I.Y. Home Warehouse, Inc. to Edgemere, Inc. f/k/a Erb Lumber Co., dated July 1, 1991, incorporated herein by reference to Exhibit 10.29 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.3.2 Security Agreement between D.I.Y. Home Warehouse and Erb Lumber Co., dated November 14, 1985, incorporated herein by reference to Exhibit 10.30 to the Registrant's Registration Statement No. 33-60012 on Form S-1 filed May 18, 1993. * 10.3.3 Revolving Credit Agreement and Security Agreement dated December 7, 1994 between D.I.Y. Home Warehouse, Inc. and National City Bank, Columbus, and Old Kent Bank and Trust Company, incorporated herein by reference to Exhibit 10.40 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. * 10.3.4 Loan and Co-lender Agreement and Open-End Mortgage, Assignment of Rents and Security Agreement dated December 23, 1994 between D.I.Y. Home Warehouse, Inc. and National City Bank, Columbus, and Old Kent Bank and Trust Company, incorporated herein by reference to Exhibit 10.41 to the Registrant's Report on Form 10-K for the fiscal year ended December 31, 1994. * 10.3.4.a First Amendment to Loan and Co-Lender Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, incorporated herein by reference to Exhibit 10.41 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995 * 10.3.4.b Second Amendment to Loan and Co-Lender Agreement dated December 23, 1996 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.52 to the Registrant's Report on Form 10-K for the fiscal year ended December 28, 1996. * 10.3.4.c Third Amendment to Loan and Co-Lender Agreement dated October 24, 1997 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.2 to the Registrant's Report on Form 10-Q for the quarter ended September 27, 1997. * 10.3.4.d Fourth Amendment to Loan and Co-Lender Agreement dated April 4, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.2 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. 30 * 10.3.4.e Fifth Amendment to Loan and Co-Lender Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.4 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.3.5 Line of Credit Agreement for Real Estate Loans, Open-end Mortgage, Assignment of Rents and Security Agreement, and Mortgage Notes between D.I.Y. Home Warehouse, Inc. and National City Bank, Columbus and Old Kent Bank dated April 28, 1995, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended April 1, 1995. * 10.3.5.a First Amendment to Line of Credit Agreement; Open-end Mortgage, Assignment of Rents and Security Agreement (Leasehold) for Trumbull County; Open-end Mortgage, Assignment of Rents and Security Agreement for Summit County; Mortgage Note to National City Bank, Columbus dated September 15, 1995; Mortgage Note to Old Kent Bank dated September 15, 1995, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended September 30, 1995. * 10.3.5.b Second Amendment to Line of Credit Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, incorporated herein by reference to Exhibit 10.39 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. * 10.3.5.c Third Amendment to Line of Credit Agreement Dated December 23, 1996 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.53 to the Registrant's Report on Form 10-K for the fiscal year ended December 28, 1996. * 10.3.5.d Fourth Amendment to Line of Credit Agreement dated October 24, 1997 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.3 to the Registrant's Report on Form 10-Q for the quarter ended September 27, 1997. * 10.3.5.e Fifth Amendment to Line of Credit Agreement dated April 4, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended July 4, 1998. * 10.3.5.f Sixth Amendment to Line of Credit Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank of Columbus and Old Kent Bank, incorporated herein by reference to Exhibit 10.5 to the 31 Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.3.6 First Amendment to Security Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, incorporated herein by reference to Exhibit 10.38 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. * 10.3.7 First Amendment to Subordination Agreement dated December 22, 1995 between D.I.Y. Home Warehouse, National City Bank, Columbus, and Old Kent Bank, and Edgemere Enterprises, Inc., incorporated herein by reference to Exhibit 10.39 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. * 10.3.8 Partial Release of Mortgage to Open-End Mortgage Assignment of Rents and Security Agreement for Richland County, Stark County, Summit County, Trumball County and Medina County by Old Kent Bank dated October 28, 1998, incorporated herein by reference to Exhibit 10.6 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.3.9 Modification to Revolving Credit Agreement, Line of Credit Agreement, and Loan and Co-lender Agreement between D.I.Y. Home Warehouse, Inc., National City Bank, Columbus, and Old Kent Bank dated February 20, 1996, incorporated herein by reference to Exhibit 10.42 to the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995. * 10.3.10 General Business Lease Agreement with IBM Credit Corporation dated May 30, 1996, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended June 29, 1996. * 10.3.11 Amendment No. 1 to Open-End Mortgage, Assignment of Rents and Security Agreement for Richland County, Stark County, Summit County, Trumball County and Medina County between D.I.Y. Home Warehouse, Inc., National City Bank and Old Kent Bank dated October 28, 1998, incorporated herein by reference to Exhibit 10.7 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.3.12 First Amendment to Mortgage Note between D.I.Y. Home Warehouse, Inc. and National City Bank dated October 28, 1998, incorporated herein by reference to Exhibit 10.8 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. 32 * 10.3.13 Second Amendment to Security Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank and Old Kent Bank, incorporated herein by reference to Exhibit 10.9 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.3.14 Second Amendment to Subordination Agreement dated October 28, 1998 between D.I.Y. Home Warehouse, Inc., National City Bank and Old Kent Bank, incorporated herein by reference to Exhibit 10.3 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.3.15 Credit and Security Agreement dated October 27, 1998 among D.I.Y. Home Warehouse, Inc. and the Lenders which are signatures hereto and National City Commercial Finance, Inc, as agent and National City Bank as Letter of Credit Bank, incorporated herein by reference to Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter ended October 3, 1998. * 10.4 Real Estate Purchase Agreement (Mansfield) between DIY Ohio Real Estate Associates Limited Partnership and D.I.Y. Home Warehouse, Inc. dated as of March 1, 1994, incorporated herein by reference to Exhibit 10.40 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 1994. * 10.5 Real Estate Purchase Agreement (Mansfield and Canton) between D.I.Y. Home Warehouse, Inc. and Gabriel Brothers, Inc. dated March 3, 1999, incorporated herein by reference to Exhibit 10.5 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. * 10.6 Sale of Merchandise Agreement (Mansfield and West Market) between D.I.Y Home Warehouse, Inc. and Schottenstein Bernstein Capital Group, LLC, dated June 3 1999, incorporated herein by reference to Exhibit 10.6 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. * 10.7 Sale of Merchandise Agreement (Boardman) between D.I.Y Home Warehouse, Inc. and Schottenstein Bernstein Capital Group, LLC, dated June 11, 1999, incorporated herein by reference to Exhibit 10.7 to the Registrant's Report on Form 10-K for the fiscal year ended January 1, 2000. ** 27.1 Financial Data Schedule for the first quarter ended April 1, 2000, filed herewith. - ------------------ * Previously filed ** Filed herewith