LOWES COMPANIES INC (Form: 10-Q, Received: 06/04/2004 15:38:20)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 30, 2004

o	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

1-7898

LOGO

LOWE'S COMPANIES, INC.

(Exact name of registrant as specified in its charter)

NORTH CAROLINA	56-0578072
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1000 Lowe's Blvd., Mooresville, NC	28117
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code	704-758-1000

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

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

CLASS
Common Stock, $.50 par value

OUTSTANDING AT MAY 28, 2004 779,633,865

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LOWE'S COMPANIES, INC. - INDEX -
			Page No.
PART 1 - Financial Information
	Item 1. Financial Statements

		Consolidated Balance Sheets - April 30, 2004 (Unaudited),
		May 2, 2003 (Unaudited) and January 30, 2004	3

		Consolidated Statements of Current and
		Retained Earnings (Unaudited) - three months
		ended April 30, 2004 and May 2, 2003	4

		Consolidated Statements of Cash Flows (Unaudited) -
		three months ended April 30, 2004 and May 2, 2003	5

		Notes to Consolidated Financial Statements (Unaudited)	6-9

		Report of Independent Registered Public Accounting Firm	10

	Item 2. Management's Discussion and Analysis of Financial Condition and		11-16
		Results of Operations

	Item 3. Quantitative and Qualitative Disclosures about Market Risk		17

	Item 4. Controls and Procedures		17

PART II - Other Information
	Item 2. Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities		18

	Item 6(a). Exhibits		18

	Item 6(b). Reports on Form 8-K		19

	Signature		19

	Exhibit Index		20

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Part I. FINANCIAL INFORMATION
Item 1. Financial Statements

Lowe's Companies, Inc. Consolidated Balance Sheets In Millions, Except Par Value Data
			(Unaudited) April 30, 2004	(Unaudited) May 2, 2003	January 30, 2004
Assets
	Current assets:
	Cash and cash equivalents		$ 1,848	$ 1,600	$ 1,446
	Short-term investments		143	77	178
	Accounts receivable - net		180	189	131
	Merchandise inventory		5,713	4,864	4,584
	Deferred income taxes		87	72	59
	Other assets		114	142	166

	Total current assets		8,085	6,944	6,564

	Property, less accumulated depreciation		12,308	10,545	11,945
	Long-term investments		163	132	169
	Other assets		222	170	241

	Total assets		$ 20,778	$ 17,791	$ 18,919

Liabilities and Shareholders' Equity
	Current liabilities:
	Short-term borrowings		$ -	$ 50	$ -
	Current maturities of long-term debt		78	30	77
	Accounts payable		3,484	2,960	2,243
	Employee retirement plans		14	27	74
	Accrued salaries and wages		166	169	335
	Other current liabilities		2,129	1,570	1,516

	Total current liabilities		5,871	4,806	4,245

	Long-term debt, excluding current maturities		3,668	3,733	3,678
	Deferred income taxes		687	499	657
	Other long-term liabilities		46	18	30

	Total liabilities		10,272	9,056	8,610

	Shareholders' equity:
	Preferred stock - $5 par value, none issued		-	-	-
	Common stock - $.50 par value;
	Shares issued and outstanding
	April 30, 2004	783
	May 2, 2003	783
	January 30, 2004	787	392	392	394
	Capital in excess of par		2,006	2,055	2,237
	Retained earnings		8,108	6,288	7,677
	Accumulated other comprehensive income		-	-	1

	Total shareholders' equity		10,506	8,735	10,309

	Total liabilities and shareholders' equity		$ 20,778	$ 17,791	$ 18,919

See accompanying notes to the unaudited consolidated financial statements.

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Lowe's Companies, Inc. Consolidated Statements of Current and Retained Earnings (Unaudited) In Millions, Except Per Share Data

	Three Months Ended
	April 30, 2004		May 2, 2003
Current Earnings	Amount	Percent	Amount	Percent
Net Sales	$ 8,681	100.00	$ 7,118	100.00
Cost of Sales	5,811	66.94	4,899	68.83
Gross Margin	2,870	33.06	2,219	31.17
Expenses:
Selling, general and administrative	1,853	21.35	1,299	18.25
Store opening costs	22	0.25	19	0.27
Depreciation	208	2.40	179	2.51
Interest	48	0.55	48	0.67
Total expenses	2,131	24.55	1,545	21.70
Pre-tax earnings	739	8.51	674	9.47
Income tax provision	284	3.27	255	3.58
Earnings from continuing operations	455	5.24	419	5.89
Earnings from discontinued operations, net of tax	-	-	2	0.02
Net earnings	$ 455	5.24	$ 421	5.91

Weighted average shares outstanding - Basic	786		783

Basic earnings per share:
Continuing operations	$ 0.58		$ 0.54
Discontinued operations	-		-
Basic earnings per share	$ 0.58		$ 0.54

Weighted average shares outstanding - Diluted	808		802

Diluted earnings per share:
Continuing operations	$ 0.57		$ 0.53
Discontinued operations	-		-
Diluted earnings per share	$ 0.57		$ 0.53

Cash dividends per share	$ 0.03		$ 0.03

Retained Earnings
Balance at beginning of period	$ 7,677		$ 5,887
Net earnings	455		421
Cash dividends	(24)		(20)
Balance at end of period	$ 8,108		$ 6,288

See accompanying notes to the unaudited consolidated financial statements.

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Lowe's Companies, Inc. Consolidated Statements of Cash Flows (Unaudited) In Millions
		Three Months Ended
		April 30, 2004	May 2, 2003
Cash flows from operating activities:
	Net Earnings	$ 455	$ 421
	Earnings from discontinued operations, net of tax	-	(2)
	Earnings from continuing operations	455	419

	Adjustments to reconcile earnings from continuing operations to net cash provided by operating activities:
	Depreciation and amortization	213	183
	Deferred income taxes	2	7
	Loss on disposition/writedown of fixed and other assets	16	7
	Stock-based compensation expense	18	5
	Tax effect of stock options exercised	7	4
	Changes in operating assets and liabilities:
	Accounts receivable - net	(49)	(9)
	Merchandise inventory	(1,129)	(892)
	Other operating assets	52	(20)
	Accounts payable	1,241	1,138
	Employee retirement plans	(60)	(61)
	Other operating liabilities	460	273
	Net cash provided by operating activities from continuing operations	1,226	1,054

Cash flows from investing activities:
	Decrease (Increase) in investment assets:
	Short-term investments	69	206
	Purchases of long-term investments	(35)	(164)
	Proceeds from sale/maturity of long-term investments	6	47
	Decrease (Increase) in other long-term assets	6	(16)
	Fixed assets acquired	(585)	(391)
	Proceeds from the sale of fixed and other long-term assets	11	19
	Net cash used in investing activities from continuing operations	(528)	(299)

Cash flows from financing activities:
	Repayment of long-term debt	(8)	(7)
	Proceeds from stock options exercised	24	28
	Cash dividend payments	(24)	(20)
	Repurchase of common stock	(288)	-
	Net cash (used in) provided by financing activities from continuing operations	(296)	1

	Net cash used in discontinued operations	-	(9)

Net increase in cash and cash equivalents		402	747
Cash and cash equivalents, beginning of period		1,446	853
Cash and cash equivalents, end of period		$ 1,848	$ 1,600

See accompanying notes to the unaudited consolidated financial statements.

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Lowe's Companies, Inc.

Notes to Consolidated Financial Statements (Unaudited)

Note 1: Basis of Presentation - The accompanying Consolidated Financial Statements (unaudited) have been reviewed by an independent registered public accounting firm and, in the opinion of management, they contain all adjustments necessary to present fairly the financial position as of April 30, 2004 and May 2, 2003, and the results of operations and cash flows for the three months ended April 30, 2004 and May 2, 2003.

These interim financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Lowe's Companies, Inc. (the "Company") Annual Report on Form 10-K for the fiscal year ended January 30, 2004. The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year.

Certain prior period amounts have been reclassified to conform to current classifications.

Note 2: Earnings Per Share - Basic earnings per share ("EPS") excludes dilution and is computed by dividing net earnings by the weighted average number of common shares outstanding for the period. Diluted EPS is calculated based on the weighted average shares of common stock as adjusted for the potential dilutive effect of stock options and convertible notes at the balance sheet date. The dilutive effect of the assumed conversion of the $580.7 million Senior Convertible Notes, issued in October 2001, has been excluded from diluted earnings per share for the three months ended April 30, 2004 and May 2, 2003 because none of the conditions that would permit conversion had been satisfied during the period.

	Three Months Ended
(In Millions, Except Per Share Data)	April 30, 2004	May 2, 2003

Basic earnings per share:
Earnings from continuing operations	$ 455	$ 419
Earnings from discontinued operations, net of tax	-	2
Net earnings	$ 455	$ 421
Weighted average shares outstanding	786	783
Basic earnings per share; continuing operations	$ 0.58	$ 0.54
Basic earnings per share; discontinued operations	-	-
Basic earnings per share	$ 0.58	$ 0.54

Diluted earnings per share:
Net earnings	$ 455	$ 421
Net earnings adjustment for
interest on convertible debt, net of tax	3	3
Net earnings, as adjusted	$ 458	$ 424
Weighted average shares outstanding	786	783
Dilutive effect of stock options	6	3
Dilutive effect of convertible debt	16	16
Weighted average shares, as adjusted	808	802
Diluted earnings per share; continuing operations	$ 0.57	$ 0.53
Diluted earnings per share; discontinued operations	-	-
Diluted earnings per share	$ 0.57	$ 0.53

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Note 3: Discontinued Operations - During the fourth quarter of fiscal 2003, the Company sold 26 commodity-focused locations operating under The Contractor Yard name (the "Contractor Yards"). This sale was effected to allow the Company to continue to focus on its retail and commercial business. The Company has reported the results of operations of the Contractor Yards as discontinued operations for the periods presented, which were as follows:

(In Millions)		Three Months Ended May 2, 2003
Net sales from discontinued operations		$ 93
Pre-tax earnings from discontinued operations		3
Income tax provision		1
Earnings from discontinued operations, net of tax		$ 2

Note 4: Property - Property is shown net of accumulated depreciation of $3.3 billion at April 30, 2004, $2.6 billion at May 2, 2003 and $3.1 billion at January 30, 2004.

Note 5: Supplemental Disclosure -

Supplemental disclosures of cash flow information:


	Thre e Months Ended
(In Millions)	April 30, 2004	May 2, 2003
Cash paid for interest (net of amount capitalized)	$ 54	$ 55
Cash paid for income taxes	15	20

Note 6: Credit Arrangements - The Company has an $800 million senior credit facility. The facility is split into a $400 million five-year tranche, expiring in August 2006, and a $400 million 365-day tranche, expiring in July 2004, which is renewable annually at the agreement of the parties. The facility is used to support the Company's $800 million commercial paper program and for short-term borrowings. Borrowings made are priced based upon market conditions at the time of funding in accordance with the terms of the senior credit facility. The senior credit facility contains certain restrictive covenants, including maintenance of a specific financial ratio. The Company was in compliance with these covenants at April 30, 2004. Fifteen banking institutions are participating in the $800 million senior credit facility and, as of April 30, 2004, there were no outstanding loans under the facility.

Note 7: Comprehensive Income - Total comprehensive income, comprised of net earnings and unrealized holding gains (losses) on available-for-sale securities, was $454.4 and $420.6 million compared to net earnings of $455.2 and $420.6 million for the three months ended April 30, 2004 and May 2, 2003, respectively.

Note 8: Accounting for Stock-Based Compensation - The Company has three stock incentive plans which are described more fully in Note 10 to the consolidated financial statements presented in the Company's Annual Report on Form 10-K for the fiscal year ended January 30, 2004.

Effective fiscal 2003, the Company adopted the fair value recognition provisions of Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation," prospectively for all employee awards granted or modified after January 31, 2003. Therefore, in accordance with the requirements of SFAS No. 148, "Accounting for Stock-Based Compensation-Transition and Disclosure," the cost related to stock-based employee compensation included in the determination of net earnings for the three months ended April 30, 2004 and May 2, 2003 is less than that which would have been recognized if the fair value based method had been applied to all awards since the original effective date of SFAS No. 123. During the three months ended April 30, 2004 and May 2, 2003, the Company recognized compensation expense totaling $18 million and $5 million, respectively, relating to stock options and awards, which generally vest over three years.

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The fair value of each option grant is estimated using the Black-Scholes option pricing model. The assumptions used to determine the fair value of options granted during the three months ended April 30, 2004 have not changed significantly from those disclosed in the Annual Report on Form 10-K for the fiscal year ended January 30, 2004. The following table illustrates the effect on net earnings and earnings per share if the fair value based method had been applied to all outstanding and unvested awards in each period.

	Three Months Ended
(In millions, except per share data)	April 30, 2004	May 2, 2003
Net earnings, as reported	$ 455	$ 421

Deduct: Total unrecognized stock-based employee compensation expense determined under the fair-value-based method for all awards net of related tax effects	(10)	(16)

Pro forma net earnings	$ 445	$ 405

Earnings per share:
Basic - as reported	$ 0.58	$ 0.54
Basic - pro forma	$ 0.57	$ 0.52

Diluted - as reported	$ 0.57	$ 0.53
Diluted - pro forma	$ 0.55	$ 0.51

Note 9: Shareholders' Equity - The Company repurchased approximately 5.2 million common shares during the first quarter of fiscal 2004 at a cost of approximately $288 million under the share repurchase program authorized by the Board of Directors in December 2003. As of April 30, 2004, the Company has remaining authorization under this share repurchase program to repurchase approximately $712 million of shares by the end of fiscal 2005.

Note 10: Recent Accounting Pronouncements - In January 2003, the Financial Accounting Standards Board ("FASB") issued FASB Interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest Entities, an interpretation of ARB 51." In December 2003, the FASB issued a revision to FIN 46 to make certain technical corrections and address certain implementation issues that had arisen. FIN 46 provides guidance on the identification and consolidation of variable interest entities, or VIEs, which are entities for which control is achieved through means other than through voting rights. The provisions of FIN 46 are required to be applied to VIEs created or in which the Company obtains an interest after January 31, 2003. For VIEs in which the Company holds a variable interest that it acquired before February 1, 2003, the provisions of FIN 46 were effective for the first quarter of 2004. The adoption of FIN 46, as revised, did not have a material impact on the Company's financial statements.

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Note 11: Subsequent Event - In May 2004, the Company entered into an agreement with General Electric Company and its subsidiaries ("GE") to sell its current portfolio of accounts receivable to GE. GE will also purchase new accounts receivable originated during the term of the agreement and service these accounts. These receivables arise primarily from sales to the Company's commercial business customers for the purchase of goods and services. This agreement was effected primarily to enhance the Company's service to its commercial business customers through the use of GE's specialized support staff in servicing these accounts, as well as the functionality of GE's information systems platform. The total portfolio of receivables sold to GE was approximately $147 million. The sale is accounted for in accordance with SFAS No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, (a replacement of FASB Statement No. 125)" and did not result in a significant gain or loss.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Lowe's Companies, Inc.

We have reviewed the accompanying consolidated balance sheets of Lowe's Companies, Inc. and subsidiaries (the "Company") as of April 30, 2004 and May 2, 2003, and the related consolidated statements of current and retained earnings and cash flows for the three month periods then ended. These interim financial statements are the responsibility of the Company's management.

We conducted our review in accordance with standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to such consolidated financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with auditing standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Lowe's Companies, Inc. and subsidiaries as of January 30, 2004, and the related consolidated statements of earnings, shareholders' equity, and cash flows for the year then ended (not presented herein); and in our report dated March 19, 2004 (April 2, 2004, as to the third paragraph in Note 10), we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of January 30, 2004 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ DELOITTE & TOUCHE LLP

Charlotte, North Carolina

June 4, 2004

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Item 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This discussion summarizes the significant factors affecting the Company's consolidated operating results, liquidity and capital resources during the three months ended April 30, 2004. This discussion should be read in conjunction with the financial statements and financial statement footnotes that are included in the Company's Annual Report on Form 10-K for the fiscal year ended January 30, 2004.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The following discussion and analysis of the results of operations and financial condition are based on the Company's financial statements that have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. The Company bases these estimates on historical results and various other assumptions believed to be reasonable, the results of which form the basis for making estimates concerning the carrying values of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates.

The Company's significant accounting polices are described in Note 1 to the consolidated financial statements presented in the Company's Annual Report on Form 10-K for the fiscal year ended January 30, 2004. Management believes that the following accounting policies affect the more significant estimates used in preparing the consolidated financial statements.

Merchandise Inventory

The Company records an inventory reserve for the potential loss associated with selling discontinued inventories below cost. This reserve is based on management's current knowledge with respect to inventory levels, sales trends and historical experience relating to the liquidation of discontinued inventory. Management does not believe the Company's merchandise inventories are subject to significant risk of obsolescence in the near-term, and management has the ability to adjust purchasing practices based on anticipated sales trends and general economic conditions. However, changes in consumer purchasing patterns could result in the need for additional reserves. The Company also records an inventory reserve for the estimated shrinkage between actual physical inventories taken. This reserve is based primarily on actual shrinkage results from previous physical inventories. Changes in actual shrinkage results from completed physical inventories could result in revisions to previously estimated shrinkage expense. Management believes it has sufficient current and historical knowledge to record reasonable estimates for both of these inventory reserves.

Vendor Funds

The Company receives funds from vendors in the normal course of business for a variety of reasons, including purchase-volume-related rebates, defective merchandise allowances, advertising allowances, reimbursement for selling expenses, displays and third-party, in-store service related costs. Management uses projected purchase volumes to determine earnings rates, validates those projections based on actual and historical purchase trends and applies those rates to actual purchase volumes to determine the amount of funds earned by the Company and receivable from the vendor. Amounts earned could be impacted if actual purchase volumes differ from projected purchase volumes.

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Under Emerging Issues Task Force (EITF) Issue No. 02-16, "Accounting by a Customer (Including a Reseller) for Certain Consideration Received from a Vendor," cooperative advertising allowances and in-store service funds are treated as a reduction of inventory cost, unless they represent a reimbursement of specific, incremental and identifiable costs incurred by the customer to sell the vendor's product. Substantially all of the cooperative advertising and in-store service funds that the Company receives do not meet the specific, incremental and identifiable criteria in EITF 02-16. Therefore, for cooperative advertising and third-party, in-store service fund agreements entered into after December 31, 2002, which was the effective date of the related provision of EITF 02-16, the Company treats funds that do not meet the specific, incremental and identifiable criteria as a reduction in the cost of inventory and recognizes these funds as a reduction of cost of sales when the inventory is sold. There is no impact to the timing of when the funds are received from vendors or the associated cash flows.

The Company historically treated volume-related discounts or rebates as a reduction of inventory cost and reimbursements of operating expenses received from vendors as a reduction of those specific expenses. The Company's historical accounting treatment for these vendor-provided funds is consistent with EITF 02-16 with the exception of certain cooperative advertising allowances and in-store services provided by third parties for which the costs are ultimately funded by vendors. The Company previously treated the cooperative advertising allowances and in-store service funds as a reduction of the related expense.

Self-Insurance

The Company is self-insured for certain losses relating to worker's compensation, automobile, general and product liability claims. Self-insurance claims filed and claims incurred but not reported are accrued based upon management's estimates of the discounted aggregate liability for uninsured claims incurred using actuarial assumptions followed in the insurance industry and historical experience. These estimates are subject to changes in forecasted payroll, sales and vehicle units, as well as the frequency and severity of claims. Although management believes it has the ability to adequately record estimated losses related to claims, it is possible that actual results could differ from recorded self-insurance liabilities.

OPERATIONS

In 2004, Lowe's continues to focus on its expansion plans, merchandising strategies and specialty sales initiatives to drive performance. Due in part to these initiatives, the first quarter of fiscal 2004 resulted in 22% sales growth and 9.9% comparable store sales growth, with positive comparable store sales increases in all geographic regions and all product categories.

The Company's expansion into metropolitan markets continued during the first quarter of 2004, as it opened its first stores in Brooklyn, New York and Tucson, Arizona, and additional stores in Las Vegas, Nevada and Dallas, Texas. The Company has established that it has the processes and procedures to efficiently support the higher volume sales and its customer focused approach gives the Company confidence in its ability to perform in these markets.

For the first quarter of fiscal 2004, net earnings increased 8.1% to $455 million compared to last year's first quarter results. Diluted earnings per share were $0.57 compared to $0.53 for the comparable quarter of last year. Excluding the $126 million of net earnings ($0.16 per diluted share) impact of EITF 02-16, net earnings would have been $581 million, a 38.0% increase over last year's first quarter and diluted earnings per share would have increased 37.7% to $0.73.

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The sales increase during the first quarter of 2004 was primarily attributable to the addition of 14.7 million square feet of retail selling space relating to new stores since last year's first quarter, as well as the increase in comparable store sales. The following table presents sales and store information excluding discontinued operations:

	Three Months Ended
	April 30, 2004	May 2, 2003
Sales (in millions)	$8,681	$7,118
Sales increases	22%	12%
Comparable store sales increases	9.9%	0.2%
Average ticket	$62.56	$57.57
At end of quarter:
Stores	980	849
Sales floor square feet (in millions)	111.9	97.2
Average store size square feet (in thousands)	114	114

Several product categories generated above average performance during the first quarter, including millwork, lumber, rough electrical, outdoor power equipment, seasonal living and cabinets. Tools performed at approximately the overall corporate average. Additionally, inflation in prices of lumber and building materials resulted in a 175 basis point favorable impact on first quarter comparable store sales.

With respect to the outdoor power equipment and seasonal living categories, although the Company experienced bad weather, supply issues and a manufacturer recall for outdoor power equipment in the first quarter of fiscal 2003, the current year's first quarter delivered comparable store sales significantly higher than the company average for these categories. Improved outdoor gas grill sales contributed to the seasonal living category's strong performance in the first quarter of 2004. The Company's new installed sales model, enhanced product training in cabinets and countertops and a reset of the department in several stores contributed to strong sales in the kitchen category. In addition, the Company continues to capitalize on the shift to the home improvement warehouse channel as the preferred channel to purchase appliances. This has resulted in continued improved sales and market share in this category during the first quarter of 2004.

Gross margin was 33.1% of sales for the quarter ended April 30, 2004 compared to 31.2% for last year's comparable quarter. As a result of the reclassification of vendor funds in accordance with EITF 02-16, vendor funds for cooperative advertising and in-store services are now classified as a reduction of cost of inventory. This change contributed approximately 119 basis points or 63% of the increase in gross margin for the quarter. The remaining gross margin increase was driven by lower inventory acquisition costs resulting in part from the use of the Company's sourcing offices to import products. A reduction in inventory shrinkage as a percentage of sales of five basis points also contributed to the increase in margin, which was partially offset by negative product mix.

Selling, general and administrative expenses ("SG&A") were 21.4% of sales versus 18.3% in last year's first quarter. SG&A increased by 43% compared to the 22% increase in sales for the quarter, which represented an increase of 310 basis points as a percentage of sales. An increase of approximately 355 basis points as a percentage of sales resulted from the reclassification of vendor funds in accordance with EITF 02-16. In addition, SG&A for the quarter included $18 million of stock-based compensation expense, compared to $5 million in the first quarter of 2003, which was the first quarter after the Company adopted the fair value recognition provisions of SFAS No. 123. These increases were partially offset by rent, property tax, and utility expenses decreasing as a percentage of sales.

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Store opening costs were $22 million for the quarter ended April 30, 2004 compared to $19 million in last year's first quarter. This represents costs associated with the opening of 29 new stores during the first quarter of 2004 compared to 21 new stores for the comparable period last year. Charges for future and prior openings in the first quarters of 2004 and 2003 were $4 million and $5 million, respectively.

Depreciation for the quarter was $208 million,, which represented an increase of 16% from the $179 million in last year's first quarter. The increase is primarily due to the addition of buildings, fixtures, displays and computer equipment relating to the Company's ongoing expansion program and the increase in the percentage of owned locations since last year's first quarter. At April 30, 2004, the Company owned 80% of total locations compared to 76% at May 2, 2003.

The Company's effective income tax rate was 38.4% for the quarter ended April 30, 2004, compared to 37.8% for last year's comparable period. The higher rate during 2004 is primarily related to expansion into states with higher income tax rates, as well as permanent differences between book and tax income related to stock-based compensation expense.

LIQUIDITY AND CAPITAL RESOURCES

The primary sources of liquidity are cash flows from operating activities and various lines of credit currently available to the Company. Net cash provided by operating activities from continuing operations was $1.2 billion for the three months ended April 30, 2004 compared to $1.1 billion for the three months ended May 2, 2003. The primary source of the increase in cash provided by operating activities from continuing operations in the current year was the increase in net earnings. Working capital at April 30, 2004 was $2.2 billion compared to $2.1 billion at May 2, 2003 and $2.3 billion at January 30, 2004.

The primary component of net cash used in investing activities from continuing operations continues to be opening new stores. Cash acquisitions of fixed assets were $585 million and $391 million for the three months ended April 30, 2004 and May 2, 2003, respectively. At April 30, 2004, the Company operated 980 stores in 45 states with 111.9 million square feet of retail selling space, representing a 15% increase over the selling space at May 2, 2003.

Cash flows used in financing activities from continuing operations were $296 million for the three months ended April 30, 2004. Cash flows provided by financing activities from continuing operations were $1 million for the three months ended May 2, 2003. Cash used in financing activities during the first three months of the current year primarily resulted from repurchases of common stock under the Company's share repurchase program, cash dividend payments and scheduled long-term debt repayments, offset by proceeds generated from stock option exercises. Cash provided by financing activities from continuing operations during the first three months of the prior year primarily resulted from proceeds generated from stock option exercises offset by cash dividend payments and scheduled long-term debt repayments. The ratio of long-term debt to equity plus long-term debt was 25.9%, 29.9% and 26.3% as of April 30, 2004, May 2, 2003 and January 30, 2004, respectively.

The Company has an $800 million senior credit facility. The facility is split into a $400 million five-year tranche, expiring in August 2006 and a $400 million 365-day tranche, expiring in July 2004, which is renewable annually at the agreement of the parties. The facility is used to support the Company's $800 million commercial paper program and for short-term borrowings. Any loans made are priced based upon market conditions at the time of funding in accordance with the terms of the senior credit facility. The senior credit facility contains certain restrictive covenants, including maintenance of a specific financial ratio. The Company was in compliance with these covenants at April 30, 2004. Fifteen banking institutions are participating in the $800 million senior credit facility and, as of April 30, 2004, there were no outstanding loans under the facility.

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The Company's 2004 capital budget is $3.4 billion, inclusive of approximately $321 million of leases, which is primarily comprised of ground and operating leases. Approximately 76% of this planned commitment is for store expansion and new distribution centers. Expansion plans for 2004 consist of approximately 140 stores, including approximately four relocations of older stores, increasing sales floor square footage by approximately 14%. Approximately 3% of the 2004 facilities will be build-to-suit leases and 97% will be owned.

At April 30, 2004, the Company operated nine regional distribution centers. In 2003, the Company began construction on an additional regional distribution center located in Poinciana, Florida, which is expected to be operational in the third quarter of 2004. The Company has begun construction on an additional regional distribution center in Plainfield, Connecticut, that is scheduled to open in fiscal 2005. At the end of fiscal 2003, the Company operated nine flatbed distribution centers for the handling of lumber, building materials and other long-length items. The Company expects to open three additional flatbed distribution centers in 2004.

The Company believes that funds from operations, leases and existing short-term lines of credit will be adequate to finance the 2004 capital budget and the Company's operating requirements. However, general economic downturns, fluctuations in the prices of products, unanticipated impact arising from competition and adverse weather conditions could have an effect on funds generated from operations and our expansion plans. In addition, the availability of funds through the issuance of commercial paper and new debt could be adversely affected due to a debt rating downgrade or a deterioration of certain financial ratios. The Company's debt ratings at April 30, 2004 were as follows:

Current Debt Ratings	S&P	Moody's	Fitch
Commercial paper	A1	P1	F1
Senior debt	A	A2	A

Outlook	Positive	Stable	Stable

COMPANY OUTLOOK

During the second quarter of 2004, the Company expects to open 19 stores reflecting square footage growth of approximately 14% when compared to the second quarter of 2003. As compared to the second quarter of 2003, total sales are expected to increase approximately 19% and comparable store sales are expected to increase 6-7%. Diluted earnings per share of $0.89 to $0.91 are expected.

For fiscal 2004, the Company expects to open 140 stores reflecting total square footage growth of approximately 14%. Total sales are expected to increase approximately 18% for the year, while comparable store sales are expected to increase 6-7 %. Including the estimated $0.16 per share impact of EITF 02-16, diluted earnings per share of $2.69 to $2.72 are expected for the fiscal year ending January 28, 2005. Excluding the impact of the accounting change, diluted earnings per share of $2.85 to $2.88 would be expected. Presentation of this measure is intended to allow comparison of the Company's fiscal 2004 performance with that in fiscal 2003.

Though there are continuing concerns about the impact of potential increases in interest rates on the home improvement market, Lowe's believes it is positioned to make the Company less susceptible to the potential negative impact of a moderate and measured rise in rates. First, a significant portion of Lowe's business is non-discretionary home maintenance. As homes in the U.S. age, they will require routine maintenance and occasional major repairs. Second, research suggests that when consumers are considering a major remodeling project, they also consider the alternative of purchasing a new home. While in times of lower interest rates consumers may choose to purchase a new home, this could shift to conducting major remodels of existing homes in times of higher interest rates. Lowe's provides the products and installation services necessary to meet this remodeling demand. Third, trends indicate that consumers are spending more of their free time at home and, as a result, these consumers are investing more time and money in their homes. Finally, home ownership continues to be a goal of the U.S. consumer and remains affordable for younger homebuyers, as well as the baby boomer population for second homes.

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FORWARD-LOOKING STATEMENTS

Certain statements made in this Form 10-Q relate to the future performance of and other expectations about the Company, particularly statements that appear in this management's discussion and analysis of financial condition and results of operations. While the Company believes these expectations are reasonable, the Company cannot guarantee them and this should be considered when thinking about statements made that are not historical facts. Some of the things that could cause actual results to differ substantially from current expectations are:

The Company's sales are dependent upon the general economic health of the country, the number of new housing starts, the level of repairs, remodeling and additions to existing homes, commercial building activity, and the availability and cost of financing. An economic downturn can impact sales because much of our inventory is purchased for discretionary projects, which can be delayed. In addition, on a short-term basis, weather may impact sales of product groups like lawn and garden, lumber, and building materials.
The Company's expansion strategy may be impacted by environmental regulations, local zoning issues and delays, availability and development of land, and more stringent land use regulations than traditionally experienced as well as the availability of sufficient labor to facilitate our growth.
Many of the Company's products, like lumber and plywood, are commodities whose prices fluctuate erratically within an economic cycle.
The Company's business is highly competitive, and as the Company expands to larger markets, and to the Internet, it may face new forms of competition which do not exist in some of the markets traditionally served.
The ability to continue the Company's everyday competitive pricing strategy and provide the products that customers want depends on its vendors providing a reliable supply of inventory at competitive prices and its ability to effectively manage our inventory.
The Company's commitment to increase market share and keep prices low requires a substantial investment in new technology and processes whose benefits could take longer than expected and could be difficult to implement.

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Item 3 - Quantitative and Qualitative Disclosures about Market Risk

The Company's market risk has not changed materially since January 30, 2004.

Item 4 - Controls and Procedures

The Company has designed and maintains disclosure controls and procedures to ensure that information required to be disclosed in its reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms. These controls and procedures are also designed to ensure that such information is accumulated and communicated to the Company's management, including its Chief Executive and Chief Financial Officers as appropriate, to allow them to make timely decisions about required disclosures.

The Company's management, including the Chief Executive Officer and Chief Financial Officer, has conducted an evaluation of the effectiveness of disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(b). Based on that evaluation, which was conducted as of the end of the period covered by this report on Form 10-Q, the Chief Executive Officer and Chief Financial Officer concluded that disclosure controls and procedures are effective in timely alerting them to material information relating to the Company (including its consolidated subsidiaries) required to be included in its periodic SEC filings.

There has been no change in the Company's internal controls over financial reporting during the quarter ended April 30, 2004 that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting

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Part II - OTHER INFORMATION

Item 2. - Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities

Issuer Purchases of Equity Securities
(In millions, except average price paid per share)	Total Number of Shares Purchased (1)	Average Price Paid per Share	Total Number of Shares Purchased as Part of Publicly Announced Plan or Programs (2)	Dollar Value of Shares that May Yet Be Purchased Under the Plan or Program

January 31, 2004 - February 27, 2004	-	$ -	-	$1,000
February 28, 2004 - April 2, 2004	3.9	55.42	3.9	785
April 3, 2004 - April 30, 2004	1.3	55.14	1.3	712

As of April 30, 2004	5.2	$55.35	5.2	$712

(1) During the first quarter of fiscal 2004, the Company repurchased an aggregate of 5,204,700 shares of its common stock pursuant to the repurchase program publicly announced on December 8, 2003 (the "Program").

(2) On December 5, 2003, the Board of Directors approved a share repurchase program under which the Company is authorized to repurchase up to $1 billion of the Company's common stock. The program expires at the end of fiscal 2005.

Item 6 (a) - Exhibits

Exhibit 3(ii) - Bylaws of Lowe's Companies, Inc., as amended and restated April 2, 2004


Exhibit 10.1 - Lowe's Companies, Inc. Cash Deferral Plan, effective January 31, 2004


Exhibit 10.2 - Lowe's Companies, Inc. Management Continuity Agreement for Executive Officers


Exhibit 31.1 - Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


Exhibit 31.2 - Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


Exhibit 32.1 - Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


Exhibit 32.2 - Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


Refer to the Exhibit Index on page 20.

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Item 6 (b) - Reports on Form 8-K

Current Report on Form 8-K filed April 5, 2004, announcing the declaration of a cash dividend and the redemption of the shareholder rights plan.

Current Report on Form 8-K filed April 5, 2004, announcing the Company's succession plan effective fiscal year end 2004.

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.


		LOWE'S COMPANIES, INC.






June 4, 2004 Date		/s/Kenneth W. Black, Jr. Kenneth W. Black, Jr. Senior Vice President and Chief Accounting Officer

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EXHIBIT INDEX

Exhibit No.		Description
3(ii)		Bylaws of Lowe's Companies, Inc., as amended and restated April 2, 2004

*10.1		Lowe's Companies, Inc. Cash Deferral Plan, effective January 31, 2004

*10.2		Lowe's Companies, Inc. Management Continuity Agreement for Executive Officers

31.1		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

* Management contract or compensatory plan or arrangement required to be filed as an exhibit to this form.

BYLAWS OF

LOWE'S COMPANIES, INC.

As Amended and Restated April 2, 2004

INDEX

ARTICLE I. OFFICES			1

ARTICLE II. SHAREHOLDERS			1

	SECTION 1.	ANNUAL MEETING	1
	SECTION 2.	SPECIAL MEETING	1
	SECTION 3.	PLACE OF MEETING	1
	SECTION 4.	NOTICE OF MEETING	2
	SECTION 5.	CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE	2
	SECTION 6.	VOTING LISTS	2
	SECTION 7.	QUORUM	3
	SECTION 8.	PROXIES; ELECTRONIC AUTHORIZATION	3
	SECTION 9.	VOTING OF SHARES	4
	SECTION 10.	CONDUCT OF MEETINGS	4

ARTICLE III. BOARD OF DIRECTORS			5

	SECTION 1.	GENERAL POWERS	5
	SECTION 2.	NUMBER, TENURE AND QUALIFICATIONS	5
	SECTION 3.	FOUNDING DIRECTOR	5
	SECTION 4.	QUARTERLY MEETINGS	5
	SECTION 5.	SPECIAL MEETINGS	6
	SECTION 6.	NOTICE	6
	SECTION 7.	QUORUM	6
	SECTION 8.	MANNER OF ACTING	6
	SECTION 9.	VACANCIES	6
	SECTION 10.	COMPENSATION	6
	SECTION 11.	PRESUMPTION OF ASSENT	6
	SECTION 12.	ACTION WITHOUT MEETING	7
	SECTION 13.	INFORMAL ACTION BY DIRECTORS	7
	SECTION 14.	COMMITTEES GENERALLY	7
	SECTION 15.	EXECUTIVE COMMITTEE	7
	SECTION 16.	AUDIT COMMITTEE	8
	SECTION 17.	COMPENSATION COMMITTEE	8
	SECTION 18.	GOVERNANCE COMMITTEE	8
	SECTION 19.	GOVERNMENT/LEGAL AFFAIRS COMMITTEE	8
	SECTION 20.	SALARY ADMINISTRATION; DIRECTORS COMPENSATION	9

ARTICLE IV. INDEMNIFICATION			9

	SECTION 1.	INDEMNIFICATION	9
	SECTION 2.	LIMITATION ON INDEMNIFICATION	9
	SECTION 3.	BOARD DETERMINATION	9
	SECTION 4.	RELIANCE	9
	SECTION 5.	AGENTS AND EMPLOYEES	10
	SECTION 6.	EXPENSES	10
	SECTION 7.	INSURANCE	10

ARTICLE V. OFFICERS			10

	SECTION 1.	TITLES	10
	SECTION 2.	ELECTION AND TERM OF OFFICE	10
	SECTION 3.	REMOVAL	10
	SECTION 4.	CHAIRMAN OF THE BOARD OF DIRECTORS	11
	SECTION 5.	VICE CHAIRMAN OF THE BOARD OF DIRECTORS	11
	SECTION 6.	PRESIDENT	11
	SECTION 7.	VICE PRESIDENTS	11
	SECTION 8.	SECRETARY	11
	SECTION 9.	TREASURER	11
	SECTION 10.	CONTROLLER	11

ARTICLE VI. DEPARTMENTAL DESIGNATIONS			11

	SECTION 1.	DEPARTMENTAL DESIGNATIONS	11

ARTICLE VII. CERTIFICATES FOR SHARES AND THEIR TRANSFER			12

	SECTION 1.	CERTIFICATES FOR SHARES; NON-CERTIFICATED SHARES	12
	SECTION 2.	TRANSFER OF SHARES	12
	SECTION 3.	LOST CERTIFICATES	13

ARTICLE VIII. FISCAL YEAR			13

ARTICLE IX. DIVIDENDS			13

ARTICLE X. SEAL			13

ARTICLE XI. WAIVER OF NOTICE			14

ARTICLE XII. AMENDMENTS			14

BYLAWS OF

LOWE'S COMPANIES, INC.

As Amended and Restated April 2, 2004

ARTICLE I. OFFICES

The principal office of the corporation in the State of North Carolina shall be located in the County of Iredell. The registered office of the corporation, required by law to be continuously maintained in the State of North Carolina, may be, but need not be, identical with the principal office and shall be maintained at that location identified as the address of the business office of the registered agent with the North Carolina Secretary of State. The corporation may have such other offices either within or without the State of North Carolina, as the Board of Directors may designate or the business of the corporation may require from time to time.

ARTICLE II. SHAREHOLDERS

SECTION 1. ANNUAL MEETING. The annual meeting of the shareholders shall be held on the last Friday in the month of May in each year, at an hour to be designated by the Chairman of the Board, for the purpose of electing directors and for the transaction of such other business as may come before the meeting. The meeting shall be held on the following business day at the same time in the event the last Friday in May shall be a legal holiday. If the annual meeting shall not be held on the day designated by this Section 1, a substitute annual meeting shall be called in accordance with the provisions of Section 2 of this Article II. A meeting so called shall be designated and treated for all purposes as the annual meeting.

SECTION 2. SPECIAL MEETINGS. Special meetings of the shareholders for any purpose or purposes may be called by the Chairman of the Board or by a majority of the Board of Directors.

SECTION 3. PLACE OF MEETING. The Board of Directors may designate any place, either within or without the State of North Carolina, as the place of meeting for any annual meeting or for any special meeting called by the Board of Directors. In the event the directors do not designate the place of meeting for either an annual or special meeting of the shareholders, the Chairman of the Board may designate the place of meeting. If the Chairman of the Board does not designate the place of meeting, the meeting shall be held at the offices of the corporation in Mooresville, North Carolina.

SECTION 4. NOTICE OF MEETING. Written notice stating the place, day, and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be given not less than 10 nor more than 60 days before the day of the meeting, by mail, by or at the direction of the Secretary, or the officer or persons calling the meeting, to each shareholder of record entitled to vote at such meeting. Such notice, when mailed, shall be deemed to be delivered when deposited in the United States mail, addressed to the shareholder at his address as it appears on the stock transfer books of the corporation, with postage thereon prepaid. When a meeting is adjourned it shall not be necessary to give any notice of the adjourned meeting other than by announcement at the meeting at which the adjournment is taken unless a new record date for the adjourned meeting is or must be fixed, in which event notice shall be given to shareholders as of the new record date.

SECTION 5. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE. For the purpose of determining shareholders entitled to notice of or to vote at the meeting or any adjournment thereof, or shareholders entitled to receive payment of any dividend, or in order to make a determination of shareholders for any other proper purpose, the Board of Directors of the corporation may provide that the stock transfer books shall be closed for a stated period but not to exceed, in any case, 60 days. If the stock transfer books shall be closed for the purpose of determining shareholders entitled to notice of or to vote at a meeting of shareholders, such books shall be closed for at least 10 days immediately preceding such meeting. In lieu of closing the stock transfer books, the Board of Directors may fix in advance a date as the record date for any such determination of shareholders, such date in any case to be not more than 70 days and, in case of a meeting of shareholders, not less than 10 days prior to the date on which the particular action, requiring such determination of shareholders, is to be taken. If the stock transfer books are not closed and no record date is fixed for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders, or of shareholders entitled to receive payment of a dividend, the date on which notice of the meeting is mailed or the date on which the resolution of the Board of Directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of shareholders. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this Section 5, such determination shall apply to any adjournment thereof if the meeting is adjourned to a date not more than 120 days after the date fixed for the original meeting.

SECTION 6. VOTING LISTS. The officer or agent having charge of the stock transfer books for shares of the corporation shall make before each meeting of shareholders a complete list of the shareholders entitled to vote at such meeting arranged in alphabetical order and by voting group (and within each voting group by class or series of shares), with the address of and the number of shares held by each. For a period beginning two business days after notice of the meeting is given and continuing through the meeting, this list shall be available at the corporation's principal office for inspection by any shareholder at any time during usual business hours. The list shall also be produced and kept open at the time and place of the meeting and shall be subject to the inspection of any shareholder during the whole time of the meeting. The original stock transfer books shall be prima facie evidence as to who are the shareholders entitled to examine such list or transfer books or to vote any meeting of shareholders.

SECTION 7. QUORUM. Shares entitled to vote as a separate voting group may take action on a matter at a meeting if a quorum of that voting group exists with respect to that matter. In the absence of a quorum at the opening of any meeting of shareholders, the meeting may be adjourned from time to time by the vote of the majority of the votes cast on the motion to adjourn. A majority of the votes entitled to be cast on the matter by the voting group constitutes a quorum of that voting group for action on that matter. Once a share is represented for any purpose at a meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of the meeting unless a new record date is or must be set for the adjourned meeting. If a quorum exists, action on a matter (other than the election of directors) by a voting group is approved if the votes cast within the voting group favoring the action exceed the votes cast opposing the action, unless the Articles of Incorporation, a Bylaw adopted by the shareholders, or the North Carolina Business Corporation Act requires a greater number of affirmative votes.

SECTION 8. PROXIES; ELECTRONIC AUTHORIZATION

(a) At all meetings of shareholders, a shareholder may vote by proxy executed in writing by the shareholder or by his duly authorized attorney in fact. Such proxy shall be filed with the secretary of the corporation before or at the time of the meeting. No proxy shall be valid after 11 months from the date of its execution, unless otherwise provided in the proxy. If a proxy for the same shares confers authority upon two or more persons and does not otherwise provide a majority of them present at the meeting or if only one is present at the meeting then that one may exercise all the powers conferred by the proxy; but if the proxy holders present at the meeting are divided as to the right and manner of voting in any particular case, and there is no majority, the voting of such shares shall be prorated.

(b) The secretary may approve procedures to enable a shareholder or a shareholder's duly authorized attorney in fact to authorize another person or persons to act for him or her as proxy by transmitting or authorizing the transmission of a telegram, cablegram, internet transmission, telephone transmission or other means of electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such transmission must either set forth or be submitted with information from which the inspectors of election can determine that the transmission was authorized by the shareholder or the shareholder's duly authorized attorney in fact. If it is determined that such transmissions are valid, the inspectors shall specify the information upon which they relied. Any copy, facsimile telecommunications or other reliable reproduction of the writing or transmission created pursuant to this Section 8 may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission.

SECTION 9. VOTING OF SHARES. Except as otherwise provided by law, each outstanding share of capital stock of the corporation entitled to vote shall be entitled to one vote on each matter submitted to a vote at a meeting of shareholders. The vote of a majority of the shares voted on any matter at a meeting of shareholders at which a quorum is present shall be the act of the shareholders on that matter, unless the vote of a greater number is required by law or by the Articles of Incorporation or Bylaws. Voting on all substantive matters shall be by a ballot vote on that particular matter. Voting on procedural matters shall be by voice vote or by a show of hands unless the holders of one-tenth of the shares represented at the meeting shall demand a ballot vote on procedural matters.

SECTION 10. CONDUCT OF MEETINGS. At each meeting of the stockholders, the Chairman of the Board shall act as chairman and preside. In his absence, the Chairman of the Board may designate another officer or director to preside. The Secretary or an Assistant Secretary, or in their absence, a person whom the Chairman of such meeting shall appoint, shall act as secretary of the meeting.

At any meeting of stockholders, only business that is properly brought before the meeting may be presented to and acted upon by stockholders. To be properly brought before the meeting, business must be brought (a) by or at the direction of the Board of Directors or (b) by a stockholder who has given written notice of business he expects to bring before the meeting to the Secretary not less than 15 days prior to the meeting. If mailed, such notice shall be sent by certified mail, return receipt requested, and shall be deemed to have been given when received by the Secretary. A stockholder's notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the meeting (a) a brief description of the business to be brought before the meeting and the reasons for conducting such business at the meeting, (b) the name and address, as they appear on the corporation's books, of the stockholder proposing such business, (c) the class and number of shares of the corporation's stock beneficially owned by the stockholder, and (d) any material interest of the stockholder in such business. No business shall be conducted at a meeting of stockholders except in accordance with the procedures set forth in this Section 10. The chairman of a meeting of stockholders shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 10, and if he should so determine, he shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted.

Any nomination for director made by a stockholder must be made in writing to the Secretary not less than 15 days prior to the meeting of stockholders at which Directors are to be elected. If mailed, such notice shall be sent by certified mail, return receipt requested, and shall be deemed to have been given when received by the Secretary. A stockholder's nomination for director shall set forth (a) the name and business address of the stockholder's nominee, (b) the fact that the nominee has consented to his name being placed in nomination, (c) the name and address, as they appear on the corporation's books, of the stockholder making the nomination, (d) the class and number of shares of the corporation's stock beneficially owned by the stockholder, and (e) any material interest of the stockholder in the proposed nomination.

Notwithstanding compliance with this Section 10, the chairman of a meeting of stockholders may rule out of order any business brought before the meeting that is not a
proper matter for stockholder consideration. This Section 10 shall not limit the right of stockholders to speak at meetings of stockholders on matters germane to the corporation's business, subject to any rules for the orderly conduct of the meeting imposed by the Chairman of the meeting. The corporation shall not have any obligation to communicate with stockholders regarding any business or director nomination submitted by a stockholder in accordance with this Section 10 unless otherwise required by law.

ARTICLE III. BOARD OF DIRECTORS

SECTION 1. GENERAL POWERS. The business and affairs of the corporation shall be managed by the Board of Directors except as otherwise provided by law, by the
Articles of Incorporation or by the Bylaws.

SECTION 2. NUMBER, TENURE AND QUALIFICATIONS. The number of directors of the Corporation shall be twelve, divided into three classes: Class I, Class II and Class III, as nearly equal in number as possible. One director shall be designated and elected by the Board as Chairman of the Board of Directors, and shall preside at all meetings of the Board of Directors. The Board may elect a Vice-Chairman whose only duties shall be to preside at Board meetings in the absence of the Chairman. Directors need not be residents of the State of North Carolina or shareholders of the corporation. Subject to the Articles of Incorporation, the Board of Directors shall each year, prior to the annual meeting, determine by appropriate resolution the number of directors which shall constitute the Board of Directors for the ensuing year, and the number of directors which shall constitute the class of directors being elected at such annual meeting. The directors may amend the Bylaws between meetings of shareholders to increase or decrease the number of directors to make vacancies available for the election of new directors.

SECTION 3. FOUNDING DIRECTOR. A Founding Director is a person who was a director when it became a public company in 1961, who was a director on November 7, 1980, and who has served continuously as a director since 1961.

SECTION 4. QUARTERLY MEETINGS. Quarterly meetings of the Board of Directors shall be held at a time and place determined by the Chairman of the Board of
Directors. Any one or more of the directors or members of a committee designated by the directors may participate in a meeting of the Board or committee by means of a conference telephone or similar communications device which allows all persons participating in the meeting to hear each other and such participation in a meeting will be deemed presence in person.

SECTION 5. SPECIAL MEETINGS. Special Meetings of the Board of Directors may be called by or at the request of the Chairman of the Board of Directors or two of the directors. The person or persons authorized to call special meetings of the Board of Directors may fix any place, either within or without the State of North Carolina, as the place for holding any special meeting of the Board of Directors called by them.

SECTION 6. NOTICE. Notice of any special meeting shall be given by either mail, facsimile or telephone. Notice of any special meeting given by mail shall be given at least five days previous thereto. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail properly addressed, with postage thereon prepaid. If notice is given by facsimile or by telephone, it shall be done so at least two days prior to the special meeting and shall be deemed given at the time the facsimile is transmitted or of the telephone call itself. Any director may waive notice of any meeting. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at nor the purpose of any regular or special meeting of the Board of Directors need be specified in the notice or waiver of notice of such meeting.

SECTION 7. QUORUM. A majority of the number of directors shall constitute a quorum for the transaction of business at any meeting of the Board of Directors, but if less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time without further notice.

SECTION 8. MANNER OF ACTING. The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors
unless otherwise required by the Articles of Incorporation.

SECTION 9. VACANCIES. Any vacancy occurring in the Board of Directors shall be filled as provided in the Articles of Incorporation.

SECTION 10. COMPENSATION. The directors may be paid such expenses as are incurred in connection with their duties as directors. The Board of Directors may also pay to the directors compensation for their service as directors.

SECTION 11. PRESUMPTION OF ASSENT. A director of the corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent to such action with the person acting as secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the secretary of the corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action.

SECTION 12. ACTION WITHOUT MEETING. Action taken by a majority of the Board, or a Committee thereof, without a meeting is nevertheless Board, or Committee,
action if written consent to the action in question is signed by all of the directors, or Committee members, and filed with the minutes of the proceedings of the Board, or
Committee, whether done before or after the action so taken.

SECTION 13. INFORMAL ACTION BY DIRECTORS. Action taken by a majority of the directors without a meeting is action of the Board of Directors if written consent to the action is signed by all of the directors and filed with the minutes of the proceedings of the Board of Directors, whether done before or after the action so taken.

SECTION 14. COMMITTEES GENERALLY. Committees of the Board of Directors shall be reestablished annually at the first Board of Directors Meeting held
subsequent to the Annual Shareholders Meeting. Directors designated to serve on committees shall serve as members of such committees until the first Board of Directors Meeting following the next succeeding Annual Shareholders Meeting or until their successors shall have been duly designated. The Board of Directors may designate a committee chairman and a committee vice chairman from the membership for each committee established. In the absence of the designation of a committee chairman or vice chairman by the Board, a committee by majority vote may elect a chairman or vice chairman from its own membership.

SECTION 15. EXECUTIVE COMMITTEE. (a) The Board may establish an Executive Committee comprising not less than three members. This Committee may exercise all of the authority of the Board of Directors to the full extent permitted by law, but shall not have power:

i) To declare dividends or authorize distributions;

ii) To approve or propose to shareholders any action that is required to be approved by shareholders under the North Carolina Business Corporation Act;

iii) To approve an amendment to the Articles of Incorporation of the Corporation;

iv) To approve a plan of dissolution; merger or consolidation;

v) To approve the sale, lease or exchange of all or substantially all of the property of the Corporation;

vi) To designate any other committee, or to fill vacancies in the Board of Directors or other committees;

vii) To fix the compensation of directors for serving on the Board of Directors or any committee;

viii) To amend or repeal the Bylaws, or adopt new Bylaws;

ix) To authorize or approve reacquisition of shares, except according to a formula or method approved by the Board of Directors;

x) To authorize or approve the issuance or sale or contract for sale of shares, or determine the designation and relative rights, preferences and limitations of a class or series of shares, unless the Board of Directors specifically authorizes the Executive Committee to do so within limits established by the Board of Directors;

xi) To amend, or repeal any resolution of the Board of Directors which by its terms is not so amendable or repealable; or

xii) To take any action expressly prohibited in a resolution of the Board of Directors.

SECTION 16. AUDIT COMMITTEE. The Board may establish an Audit Committee comprising not less than three members, all of whom shall be non-employee
directors. The Committee shall aid the Board in carrying out its responsibilities for accurate and informative financial reporting, shall assist the Board in making recommendations with respect to management's efforts to maintain and improve financial controls, shall review reports of examination by the independent auditors, and except as otherwise required by law, shall have authority to act for the Board in any matter delegated to this Committee by the Board of Directors. The Committee shall recommend each year an independent certified public accounting firm as independent auditors for the Corporation. The Corporation's Head of Internal Audit shall report to the Audit Committee, and his employment may only be terminated with the approval of the Committee.

SECTION 17. COMPENSATION COMMITTEE. The Board may establish a Compensation Committee comprising not less than three members, all of whom shall be non-employee directors. Except as otherwise required by law, the Compensation Committee shall have authority to act for the Board in any matter delegated to this Committee by the Board of Directors.

SECTION 18. GOVERNANCE COMMITTEE. The Board may establish a Governance Committee comprising not less than three members, all of whom shall be non-employee directors. Except as otherwise required by law, the Governance Committee shall have authority to act for the Board in any matter delegated to this Committee by the Board of Directors.

SECTION 19. GOVERNMENT/LEGAL AFFAIRS COMMITTEE. The Board may establish a Government/Legal Affairs Committee to consist of not less than three directors. Except as otherwise required by law, the Government/Legal Affairs Committee shall have authority to act for the Board in any manner delegated to this Committee by the Board of Directors.

SECTION 20. SALARY ADMINISTRATION; DIRECTORS COMPENSATION. The compensation of employees not covered by the Compensation Committee duties shall be the responsibility of the Chief Executive Officer. The compensation of independent directors shall be recommended to the Board of Directors by the Chief Executive Officer.

ARTICLE IV. INDEMNIFICATION

SECTION 1. INDEMNIFICATION. In addition to any indemnification required or permitted by law, and except as otherwise provided in these Bylaws, any person who at any time serves or has served as a director or officer of the corporation, or in such capacity at the request of the corporation for any other corporation, partnership, joint venture, trust or other enterprise, shall have a right to be indemnified by the corporation to the fullest extent permitted by law against (i) reasonable expenses, including attorneys' fees, actually and necessarily incurred by him in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, seeking to hold him liable by reason of the fact that he is or was acting in such capacity, and (ii) payments made by him in satisfaction of any judgment, money decree, fine, penalty or reasonable settlement for which he may have become liable in any such action, suit or proceeding.

SECTION 2. LIMITATION ON INDEMNIFICATION. The corporation shall not indemnify any person hereunder against liability or litigation expense he may incur on
account of his activities which were at the time taken known or believed by him to be clearly in conflict with the best interests of the corporation. The corporation shall not indemnify any director with respect to any liability arising out of N.C.G.S. section 55-8-33 (relating to unlawful declaration of dividends) or any transaction from which the director derived an improper personal benefit as provided in N.C.G.S. section 55-2-02(b)(3).

SECTION 3. BOARD DETERMINATION. If any action is necessary or appropriate to authorize the corporation to pay the indemnification required by this Bylaw the Board of Directors shall take such action, including (i) making a good faith evaluation of the manner in which the claimant for indemnity acted and of the reasonable amount of indemnify due him, (ii) giving notice to, and obtaining approval by, the shareholders of the corporation, and (iii) taking any other action.

SECTION 4. RELIANCE. Any person who at any time after the adoption of this Bylaw serves or has served in any of the capacities indicated in this Bylaw shall be deemed to be doing or to have done so in reliance upon, and as consideration for, the right of indemnification provided herein. Such right shall inure to the benefit of the legal representatives of any such person and shall not be exclusive of any other rights to which such person may be entitled apart from the provision of this Bylaw.

SECTION 5. AGENTS AND EMPLOYEES. The provisions of this Bylaw shall not be deemed to preclude the corporation from indemnifying persons serving as agents or employees of the corporation, or in such capacity at the request of the corporation for any other corporation, partnership, joint venture, trust or other enterprise, to the extent permitted by law.

SECTION 6. EXPENSES. The corporation shall be entitled to pay the expenses incurred by a director or officer in defending a civil or criminal action, suit or proceeding in advance of final disposition upon receipt of an undertaking by or on behalf of the director or officer to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the Corporation against such expenses.

SECTION 7. INSURANCE. As provided by N.C.G.S. section 55-8-57, the Corporation shall have the power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or who is or was serving at the request of the corporation as a director, officer or employee or agent of another corporation, partnership, joint venture, trust or other enterprise or as a trustee or administrator under an employee benefit plan against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation has the power to indemnify him against such liability.

ARTICLE V. OFFICERS

SECTION 1. TITLES. The officers of the corporation may consist of the Chairman of the Board of Directors, Vice Chairmen, the President, and such Vice Presidents as shall be elected as officers by the Board of Directors. There shall also be a Secretary, Treasurer, Controller and such assistants thereto as may be elected by the Board of Directors. Any one person may hold one or more offices in the corporation. No officer may act in more than one capacity where action of two or more is required.

SECTION 2. ELECTION AND TERM OF OFFICE. The officers of the corporation shall be elected annually by the Board of Directors at the first meeting of the
Board held after each annual meeting of the shareholders, or at any other meeting of said Board. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Each officer shall hold office until his successor shall have been duly elected and shall have qualified or until his death or until he shall resign or shall have been removed in the manner hereinafter provided.

SECTION 3. REMOVAL. Since officers serve at the pleasure of the Board, any officer may be removed at any time by the Board of Directors, with or without cause.
Termination of an officer's employment with the Corporation by the appropriate official (and by the Audit Committee for the Head of Internal Audit) shall also end his term as an officer.

SECTION 4. CHAIRMAN OF THE BOARD OF DIRECTORS. There shall be a Chairman of the Board of Directors elected by the directors from their members. The Chairman shall preside at meetings of the Board of Directors, shall be the Chief Executive Officer of the corporation, and shall have direct supervision and control of all of the business affairs of the corporation, subject to the general supervision and control of the Board of Directors. The Chairman shall have power to sign certificates for shares of the corporation and any deeds, mortgages, bonds, contracts, or any other instruments or documents which may be lawfully executed on behalf of the corporation. The Chairman shall vote as agent for the corporation the capital stock held or owned by the corporation in any corporation. The Chairman is authorized to delegate the authority to vote capital stock held or owned by the corporation and to execute and deliver agreements and other instruments to other officers of the corporation.

SECTION 5. VICE CHAIRMEN OF THE BOARD OF DIRECTORS. The Board of Directors may elect one or more Vice Chairmen from their members. A Vice Chairman shall preside at meetings of the Board of Directors in the absence of the Chairman.

SECTION 6. PRESIDENT. The President perform such duties and have such responsibilities as are assigned by the Board of Directors or the Chief Executive Officer.

SECTION 7. VICE PRESIDENTS. The Vice Presidents shall perform such duties and have such responsibilities as are assigned by the Board of Directors or the Chief Executive Officer.

SECTION 8. SECRETARY. The Secretary shall perform such duties and have such responsibilities as are assigned by the Board of Directors or the Chief Executive Officer.

SECTION 9. TREASURER. The Treasurer shall perform such duties and have such responsibilities as are assigned by the Board of Directors or the Chief Executive Officer.

SECTION 10. CONTROLLER. The Controller shall perform such duties and have such responsibilities as are assigned by the Board of Directors or the Chief Executive Officer.

ARTICLE VI. DEPARTMENTAL DESIGNATIONS

SECTION 1. DEPARTMENTAL DESIGNATIONS. The Chief Executive Officer may establish such departmental or functional designations or titles pertaining to supervisory personnel as the Chief Executive Officer in his discretion deems wise. The designations or titles may be that of Senior Vice President, Vice President or such other term or terms as the Chief Executive Officer desires to utilize. The designation or title contemplated by this section is for the purpose of administration within the department or function concerned and is not with the intent of designating those individuals bearing such titles as general officers of the corporation. These individuals bearing these titles shall be known as administrative managers of the corporation.

ARTICLE VII. CERTIFICATES FOR SHARES AND THEIR TRANSFER

SECTION 1. CERTIFICATES FOR SHARES; NON-CERTIFICATED SHARES

(a) Certificates representing shares of the corporation shall be in such form as shall be determined by the Board of Directors. Such certificates shall be signed by the Chairman of the Board and by the Secretary, provided that where a certificate is signed by a transfer agent, assistant transfer agent or co-transfer agent of the corporation or with the duly designated transfer agent the signatures of such officers of the corporation upon the certificate may be facsimile engraved or printed. Each certificate shall be sealed with the seal of the corporation or a facsimile thereof. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares represented thereby are issued, with the number of shares and class and date of issue, shall be entered on the stock transfer books of the corporation, as the transfer agent. All certificates surrendered to the corporation for transfer shall be canceled and no new certificate shall be issued until the former certificate for a like number of shares shall have been surrendered and canceled, except that in case of a lost, destroyed, or mutilated certificate a new one may be issued therefor upon such terms and indemnity to the corporation as the Board of Directors may prescribe.

(b) The Board of Directors may authorize the issuance of some or all of the shares of any or all of the corporation's classes or series of stock without certificates. Such authorization shall not affect shares already represented by certificates until such shares are surrendered to the corporation. Within a reasonable time after the issuance or transfer of shares without certificates, the corporation shall send the shareholder a written statement with information required on certificates by North Carolina General Statutes 55-6-25(b) and (c), and, if applicable, North Carolina General Statutes 55-6-27, or any successor law.

SECTION 2. TRANSFER OF SHARES. Transfer of shares of the corporation shall be made only on the stock transfer books of the corporation by the holder of records
thereof or by his legal representative, who shall furnish proper evidence of authority to transfer, or by his attorney thereunto authorized by power of attorney duly executed and filed with the secretary of the corporation, and on surrender for cancellation of the certificate for such shares. The person in whose name shares stand on the books of the corporation shall be deemed by the corporation to be the owner thereof for all purposes. To the extent that any provision of the Rights Agreement between the Company and Wachovia Bank, N.A., Rights Agent, dated as of September 9, 1998, is deemed to constitute a restriction on the transfer of any securities of the Company, including, without limitation, the Rights, as defined therein, such restriction is hereby authorized by the Bylaws of the Company.

Transfer of shares not represented by certificates shall be made in accordance with such requirements with respect to transfer as appear in Article 8 of the Uniform Commercial Code as in effect from time to time in North Carolina.

SECTION 3. LOST CERTIFICATES. The Board of Directors may authorize the issuance of a new certificate in place of a certificate claimed to have been lost or destroyed, upon receipt of an affidavit of such fact from the person claiming the loss or destruction. In authorizing such issuance of a new certificate, the Board may require the claimant to give the corporation a bond in such sum as it may direct to indemnify the corporation against loss from any claim with respect to the certificate claimed to have been lost or destroyed; or the Board, by resolution reciting that the circumstances justify such action, may authorize the issuance of the new certificate without requiring such a bond. This function or duty on the part of the Board may be assigned by the Board to the transfer agents of the common stock of the corporation.

ARTICLE VIII. FISCAL YEAR

The fiscal year of the Corporation shall end on the Friday nearest to January 31 of each year. The fiscal year shall consist of four quarterly periods, each comprising 13 weeks, with the 13-week periods divided into three periods of four weeks, five weeks, and four weeks. Every six to eight years, the fiscal year shall be a 53-week year, with the fourth period comprising four weeks, five weeks, and five weeks, to reflect the 365th day of each year and the 29th day of February in leap year.

ARTICLE IX. DIVIDENDS

The Board of Directors may from time to time declare, and the corporation may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and as provided in a resolution of the Board of Directors.

ARTICLE X. SEAL

The Board of Directors shall provide a corporate seal which shall be circular in form and shall have inscribed thereon the name of the corporation, the state of incorporation, and the word "Seal".

ARTICLE XI. WAIVER OF NOTICE

Whenever any notice is required to be given to any shareholder or director of the corporation under the provisions of the charter or under the provisions of applicable law, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.

ARTICLE XII. AMENDMENTS

Unless otherwise prescribed by law or the charter, these Bylaws may be amended or altered at any meeting of the Board of Directors by affirmative vote of a majority of the directors. Unless otherwise prescribed by law or the charter, the shareholders entitled to vote in respect of the election of directors, however, shall have the power to rescind, amend, alter or repeal any Bylaws and to enact Bylaws which, if expressly so provided, may not be amended, altered or repealed by the Board of Directors.

LOWE'S COMPANIES

CASH DEFERRAL PLAN

Section 1. Nature of the Plan.

The purpose of this Plan is to permit eligible employees to voluntarily defer a portion of their base salary, management bonus, and certain other bonuses on a tax-deferred basis, and to have such deferred amounts credited with earnings, generally using the same investment choices as are available from time to time under the Lowe's Companies Benefit Restoration Plan. The Plan is intended to be unfunded and maintained primarily for the purpose of providing deferred compensation for a select group of management and highly compensated employees, within the meaning of Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). The plan is adopted effective for base salary and management bonuses payable in the Company's fiscal year that begins January 31, 2004.

Section 2. Definitions.

In this Plan, whenever the context so indicates, the singular or plural number and the masculine, feminine or neuter gender shall be deemed to include the other and the terms "he," "his" and "him" shall refer to a Participant. Unless otherwise indicated, section references shall be to this Plan. Where the following terms appear hereafter in this Plan, they shall have the meanings indicated below:

401(k) Plan - The Lowe's Companies 401(k) Plan, a stock bonus and profit sharing plan which constitutes a cash or deferred arrangement under Section 401(k) of the Code.

Account - The account established and maintained for bookkeeping purposes to reflect the interest of a Participant in the Plan. Each Account shall reflect Employee Deferrals by the Participants, as well as additions, withdrawals, and adjustments to the Account (including adjustments for appreciation and depreciation in the deemed investments). The Account shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant or Beneficiary under the Plan.

Base Pay - The base pay paid to a Participant by the Company in the Plan Year, plus the amount (if any) of (i) Salary Deferral Contributions made on his behalf under the 401(k) Plan, (ii) salary reductions for the Medical Coverage Benefit under the Lowe's Companies Flexible Benefit Plan, (iii) any base pay that is required to be deferred because it exceeds the amount deductible by the Company under Section 162(m) of the Code; and (iv) any base pay that is deferred under this or any other plan of non-qualified deferred compensation that is adopted and maintained by the Company.

Beneficiary - The person (or persons) designated by the Participant to receive benefits under the Plan in the event of a Participant's death. If a Participant fails to make such designation, the Participant's Beneficiary shall be deemed to be his surviving spouse, or if none, his estate.

Benefit Restoration Plan - The Lowe's Companies Benefit Restoration Plan (or BRP), a non-qualified deferred compensation plan that restores benefits to eligible employees that cannot be received under the 401(k) Plan because of limitations under the Code.

Code - The Internal Revenue Code of 1986, as amended.

Committee - The Administrative Committee of the 401(k) Plan appointed by the Board of Directors of the Company, which has been given authority by the Board of Directors to designate Participants and to administer the Plan.

Company - Lowe's Companies, Inc, a North Carolina corporation, and its direct or indirect wholly-owned subsidiaries (including wholly-owned limited liability companies).

Deferral Election - The Participant's irrevocable election under the Plan to defer Base Pay, Management Bonus, or a Signing/Retention Bonus for a given Plan Year.

Employee Deferral - The employee pre-tax deferrals made under this Plan.

ERISA - Public Law 93 406, popularly known as the "Employee Retirement Income Security Act of 1974", as amended.

Management Bonus - The annual bonus, if any, that is earned by a Participant for a fiscal year and is typically paid in March following the close of the fiscal year.

Participant - Any employee or former employee who has met the applicable eligibility requirements of Section 3 and who has not yet received a complete distribution of his Account.

Plan - The Lowe's Companies Cash Deferral Plan, as set forth herein, and as it may be amended from time to time.

Plan Year - The 52/53-week period ending on Friday closest to January 31st of each year (and coinciding with the fiscal year of the Company).

Signing/Retention Bonus - A signing or retention bonus negotiated by the Company and a person who once hired will be eligible to participate in the Plan.

Trust - The Lowe's Companies, Inc. Benefit Security Trust, as amended from time to time. The Trust is a so-called "rabbi trust" that serves as the funding vehicle for the Plan and the Benefit Restoration Plan.

Section 3. Eligibility and Participation.

An employee shall be eligible to participate in the Plan as of the date he is designated by the Committee for eligibility, either individually or as a member of a class of employees. Until determined otherwise by the Committee, the employees who are eligible to become Participants for a given Plan Year are those employees of the Company who are director level or above. Notwithstanding the foregoing, a person who would otherwise become eligible to participate in this Plan as a result of promotion within the Company shall not be eligible to participate in the Plan until the first day of the Plan Year following the date such promotion becomes effective.

Only employees who are members of a select group of management and highly compensated employees (within the meaning of Title I of ERISA) are eligible to participate in the Plan. Notwithstanding anything to the contrary in the Plan, the Committee shall be authorized to modify the eligibility requirements and rescind the eligibility of any Participant if necessary to ensure that the Plan is maintained primarily for the purpose of providing additional benefits to a select group of management or highly compensated employees under ERISA.

Section 4. Funding.

The benefits under this Plan may be funded under the Trust. Regardless of the extent to which the Company chooses to fund its obligations under the Plan by transferring cash or property to the Trust, the Plan shall at all times be "unfunded" within the meaning of ERISA and the Code. When a Participant (or Beneficiary) is entitled to a distribution under Section 9, such distribution will be paid either by the Company or from assets held in the Trust, as further described in the Trust document.

Section 5. Employee Deferrals.

(a) Compensation Which May Be Deferred. A Participant who chooses to participate in the Plan for a Plan Year must elect to participate to do so for the entire Plan Year by executing a Deferral Election Form on a timely basis, as provided herein. If a Participant elects to participate in the Plan for a Plan Year, then the following shall occur:

(1) Base Pay Deferral. Each payroll period during such Plan Year, a Participant may elect to have up to eighty percent (80%) of the Participant's Base Pay deducted from his Base Pay and credited to his Account under the Plan. Such election may be expressed as a percentage of Base Pay, a set dollar amount, or in any other manner permitted by the Committee from time to time.

(2) Management Bonus Deferral. A Participant may elect to have up to eighty percent (80%) of the Participant's Management Bonus, if any, deducted from his Management Bonus and credited to his Account under the Plan. Such election may be expressed as a percentage of the Management Bonus, a set dollar amount, an amount in excess of a set dollar amount, or in any other manner permitted by the Committee from time to time.

(3) Signing/Retention Bonus Deferral. A person who once hired will be eligible to participate in the Plan, and who has negotiated a signing or retention bonus with the Company, may elect to have up to eighty percent (80%) of such bonus deducted and credited to his Account under the Plan. Such election may be expressed as a percentage of the Signing/Retention Bonus, a set dollar amount, or in any other manner permitted by the Committee from time to time.

(4) Allocation Dates. The Base Pay Deferral, Management Bonus Deferral, and Signing/Retention Bonus Deferral, respectively, shall be allocated to the Participant's Account on the date that the Base Pay, Management Bonus, or Signing/Retention Bonus, respectively, would have been paid to the Participant, but for his participation in the Plan.

(b) The Form of the Deferral Election. A Deferral Election shall be made in a manner prescribed by the Committee.

(1) Initial Election. The initial Deferral Election under this election must be made no later than December 31, 2003. Such election shall apply to Base Pay to be received in the Company's fiscal year that begins January 31, 2004, and to the Management Bonus to be paid in March 2004.

(2) Elections for Subsequent Plan Years. Deferral Elections for subsequent Plan Years must be made no later than thirty (30) days before the beginning of the fiscal year in which the Base Pay or the Management Bonus would be earned (e.g., for any Management Bonus to be paid in March 2005, the Deferral Election must be made no later than December 31, 2003, which is thirty days before the beginning of the Company's fiscal year that begins January 31, 2004). The Deferral Election for a Signing/Retention Bonus must be made at the time the Signing/Retention Bonus is negotiated with the Company.

(3) Special Thirty Day Rule for New Participants. The initial Deferral Election for a new Participant shall be made in a form acceptable to the Committee, not later than thirty (30) days after the date the Participant is notified of his eligibility to participate in the Plan.

(4) Other Rules. Any revocation of the most recent Deferral Election shall be made in a form prescribed by the Committee not later than the deadline that would have applied to the Deferral Election (e.g., the revocation of a Deferral Election for Base Pay must be made no later than thirty (30) days before the beginning of the fiscal year in which the Base Pay would be earned). A Deferral Election shall not carry forward to future Plan Years; a new Deferral Election form must be completed for each Plan Year.

Section 6. Deemed Investment of Account.

(a) Deemed Investment of Accounts. Each Participant's Account shall be deemed to be invested in one or more of the investment options permitted from time to time under the Benefit Restoration Plan. The investment elections under this Plan shall be made using the same investment election rules and procedures as provided from time to time under the Benefit Restoration Plan. Notwithstanding the foregoing, the Company intends that the Plan shall be "unfunded" within the meaning of ERISA and the Code, and the provisions in this Section providing for employee deemed investment directions shall not require the Company or any other party to make any specific actual investments to reflect such directions.

(b) Annual Statement. At least once each Plan Year, each Participant shall be furnished with a statement reflecting the following information:

(1) The balance (if any) in his Account as of the beginning of the Plan Year.

(2) The amount allocated to his Account for that Plan Year.

(3) The new balance in his Account.

Section 7. Vesting.

Except as otherwise provided in this Plan, a Participant's interest in his Account shall be 100% vested at all times.

Section 8. Payment of Account After Set Number of Years.

A Participant may elect that deferrals for a given Plan Year shall be segregated into a separate sub-account and paid at a set date, rather than being paid at termination of employment. If a Participant makes such an election, then all deferrals for such Plan Year shall be credited to such sub-account. The amounts in such sub-account, together with deemed investment earnings thereon, shall be paid to the Participant at a set date elected by the Participant, provided that such date shall be not less than five (5) years from the date of the Deferral Election. The investment of the amounts in a given sub-account shall be governed by the Participant's investment election for the remainder of his Account, and a Participant shall not be permitted to make a separate investment election for any sub-account.

A Participant may elect that a given sub-account be paid in any of the payment forms permitted under Section 9, provided, however that the $25,000 rule set forth in Section 9 shall not apply to amounts held in a sub- account under this Section 8. The payment date for a given sub-account, once elected, may not be changed thereafter, provided, however, that a Participant, at the time the Deferral Election is first made, may elect that if he or she terminates employment before the set payment date for the sub-account, all amounts in the sub-account shall be accelerated to a lump sum payment at the time of termination of employment.

Section 9. Payment of Account After Termination of Employment .

(a) Time and Form of Payment. Within 120 days after the end of the Plan Year coinciding with or next following a Participant's termination of employment, the Participant shall be entitled to commence receiving payment of the balance of his Account (including any deemed appreciation and depreciation through the date of distribution). The Participant may elect to have his Account paid in one of the following three methods:

(1) Single lump sum payment,

(2) Installments payable annually over a period of five (5) years, or

(3) Installments payable annually over a period of ten (10) years,

as specified by the Participant on forms made available by the Committee. A lump sum distribution will be paid in lieu of installments if as of the date of termination of employment, the Account balance is $25,000 or less. If the Participant fails to specify a form of payment, his Account shall be distributed in a lump sum.

In the event payment is made in installments, the Participant's Account shall continue to be adjusted for additions, withdrawals, deemed appreciation and depreciation as provided herein, and the amount of the payment to be made in a given year shall be equal to (i) times (ii), where (i) equals the value of the Participant's Account as of the most recent valuation date (which for purposes of paying installments, shall be anniversary of the date payments commence under this Plan), and (ii) equals a fraction, the numerator of which is one, and the denominator of which is the number of installments to be paid under the Participant's election (including the current installment).

All payments shall be made in cash.

(b) Changing the Form of Distribution. A Participant may amend his election as to the form of payment, provided that such change is made at least one (1) year prior to the Participant's termination of employment. Any such amended election shall apply to all deferrals and credits from all prior years which are payable at the Participant's termination of employment.

(c) Payment to Beneficiary. In the event a Participant dies before his Account has been fully paid to him, his remaining Account will be paid to his Beneficiary in a single lump sum as soon as practicable.

(d) Withholding. The Company shall withhold from any payment the amount of all applicable federal and state income and other taxes. In addition, the Company may reduce the amount otherwise payable under this Section 9 by any amounts owed by the Participant to the Company.

Section 10. Administration.

(a) In General. The Plan shall be administered by the Committee. The members of the Committee shall be appointed by and may be removed by the Board, in each case by written notice delivered to the Committee member. A majority of the members of the Committee shall constitute a quorum for the transaction of business at any meeting. Any determination or action of the Committee may be made or taken by a majority of the members present at any meeting thereof, or without a meeting by resolution or written memorandum concurred in by a majority of members. Meetings may be held electronically.

(b) Powers of the Committee. The Committee shall administer the Plan in accordance with its terms and shall have all powers necessary to carry out the provisions of the Plan. It shall interpret the Plan and shall determine all questions arising in the administration, interpretation and application of the Plan. It shall determine the eligibility for benefits, the amount of any benefit due and the manner in which any benefit is to be paid by the Plan. It will construe the Plan, supplying any omissions, reconciling any differences and determining factual issues relating to the Plan. The Committee may adopt such rules as it deems desirable for the conduct of its affairs. It may appoint such accountants, counsel, actuaries, specialists and other persons as it deems necessary or desirable in connection with the administration of this Plan, and shall be the agent for the service of process. All powers of the Committee shall be exercised in its discretion, and the Committee shall be given the greatest possible deference permitted by law in the exercise of such authority.

(c) Electronic Administration. Notwithstanding anything to the contrary in the Plan, the Committee may announce from time to time that Participant enrollments, Participant elections, and the any other aspect of plan administration may be made by telephonic or other electronic means rather than in paper form.

Section 11. Claims Procedure.

A Participant (or Beneficiary) who does not receive a distribution of benefits to which he believes he is entitled may present a claim to the Company's Manager of Compensation, or his delegate (such manager and his delegate(s) are referred to hereafter as the "Manager"). The claim for benefits must be in writing and addressed to the Manager or to the Company. If the claim for benefits is denied, the Manager shall notify the Participant (or Beneficiary) in writing within 90 days after the Manager initially received the benefit claim. Any notice of a denial of benefits shall advise the Participant (or Beneficiary) of the basis for the denial, any additional material or information necessary for the Participant (or Beneficiary) to perfect his claim and the steps which the Participant (or Beneficiary) must take to have his claim for benefits reviewed.

Each Participant (or Beneficiary) whose claim for benefits has been denied may file a written request for a review of his claim by the Committee. The request for review must be filed by the Participant (or Beneficiary) within 60 days after he receives the written notice denying his claim. The decision of the Committee will be made within 60 days after receipt of a request for review and shall be communicated in writing to the claimant. Such written notice shall set forth the basis for the Committee's decision. If there are special circumstances (such as the need to hold a hearing) which require an extension of time for completing the review, the Committee's decision shall be rendered not later than 120 days after receipt of a request for review. All decisions and interpretations of the Committee under this Section 11 shall be conclusive and binding upon all persons with an interest in the Plan and shall be given the greatest deference permitted by law.

Section 12. Limitation on Participants' Rights.

(a) Non-Guarantee of Employment. The adoption and maintenance of the Plan shall not be deemed to constitute a contract of employment or otherwise between the Company and any employee, or to be a consideration for, or an inducement or condition of, any employment. Nothing contained in this Plan shall be deemed to give an employee the right to be retained in the service of the Company or to interfere with the right of the Company to discharge, with or without cause, any employee at any time.

(b) No Assignment of Benefits. A Participant's interest in his Account may not be anticipated, assigned (either at law or in equity), alienated or subject to attachment, garnishment, levy, execution or other legal or equitable process; provided, however, that a Participant may designate one or more Beneficiaries.

(c) Distributions Not Compensation for Purposes of Any Other Plan. Distributions from a Participant's Account shall not be considered wages, salaries or compensation under any other employee benefit plan.
Section 13. Rights of Participants and Beneficiaries.

The rights of a Participant or any Beneficiary of the Participant shall be solely those of an unsecured general creditor of the Company. A Participant or Beneficiary of the Participant shall have the right to receive those payments specified under this Plan only from the Company or the Trust. The parties have no right to look to any specific or special property separate from the Company or the Trust to satisfy a claim for benefit payments.

A Participant agrees that he or his Beneficiary shall have no right, claim, security interest, or any beneficial ownership interest whatsoever in any general asset that the Company may acquire or use to help support its financial obligations under this Plan. Any general asset used or acquired by the Company in connection with the liabilities it has assumed under this Plan shall not be deemed to be held under any trust for the benefit of the Participant or his Beneficiary (other than the Trust), and no general asset shall be considered security for the performance of the obligations of the Company.

A Participant also understands and agrees that his participation in the acquisition of any general asset for the Company shall not constitute a representation to the Participant or his Beneficiary that any of them has a special or beneficial interest in any general asset.

The Company's obligation under this Plan shall be an unfunded and unsecured promise to pay. Except as provided in the rabbi trust described in Section 4, the Company shall not be obligated under any circumstances to fund its financial obligations under this Plan. All assets which the Company may acquire to help cover its financial liabilities are and remain general assets of the Company subject to the claims of its creditors. The Company does not give, and the Plan does not give, any beneficial ownership interest in any asset of the Company to a Participant or his Beneficiary. All rights of ownership in any assets are and remain in the Company or the rabbi trust described in Section 4. The Company's liability for payment of benefits shall be determined only under the provisions of this Plan as it may be amended from time to time.

Section 14. Plan Binding.

The Plan shall be binding upon the Company and any successor company through merger, acquisition or consolidation, and upon a Participant, his Beneficiary, heirs, executors and administrators.

Section 15. Future of the Plan.

The Company reserves the right to amend or terminate the Plan (in whole or in part) at any time, by action of the Company's Board of Directors. Notwithstanding the foregoing, the Committee may amend the Plan without approval of the Board provided that the Committee determines in good faith that such amendment (i) will not result in a significant cost increase to the Company; (ii) will not result in the issuance of Lowe's common stock; and (iii) is not limited in impact to only officers of the Company. Any termination of the Plan includes the right to pay to Participants upon Plan termination the full value of their Accounts in a lump sum, regardless of the prior elections made by the Participants. However, no such amendment, modification, or termination shall reduce the value of benefits credited under the Plan prior to such amendment, modification or termination. If the Plan is terminated, distribution of Accounts shall occur at such time as may be determined by the Committee.

Section 16. Governing Law.

The provisions of this Plan shall be construed and interpreted in accordance with the laws of the State of North Carolina, except to the extent such laws are superseded by ERISA.

Section 17. Execution.

To record the amendment and restatement of this Plan, the Company has caused this document to be executed on this 5th day of December, 2003.

LOWE'S COMPANIES, INC.

By /s/ Perry G. Jennings

MANAGEMENT CONTINUITY AGREEMENT
FOR EXECUTIVE OFFICERS

AGREEMENT by and between Lowe's Companies, Inc., a North Carolina corporation (the "Company") and _____________________ ("Executive"), dated as of the ______ day of ____________, 2004.

The Board of Directors of the Company (the "Board"), has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication of Executive, notwithstanding the possibility, threat or occurrence of a Change in Control (as defined below) of the Company. The Board believes it is imperative to diminish the inevitable distraction of Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change in Control and to encourage Executive's full attention and dedication to the Company currently and in the event of any threatened or pending Change in Control, and to provide Executive with compensation and benefits arrangements upon a Change in Control which ensure that the compensation and benefits expectations of Executive will be satisfied and which are competitive with those of other corporations. Therefore, in order to accomplish these objectives, the Board has caused the Company to enter into this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

1. Certain Definitions.

(a) The "Effective Date" shall mean the first date during the Change in Control Period (as defined in Section l(b)) on which a Change in Control (as defined in Section 2) occurs. Anything in this Agreement to the contrary notwithstanding, if a Change in Control occurs and if Executive's employment with the Company is terminated prior to the date on which the Change in Control occurs, and if it is reasonably demonstrated by Executive that such termination of employment (i) was at the request of a third party who has taken steps reasonably calculated to effect a Change in Control or (ii) otherwise arose in connection with or anticipation of a Change in Control, then for all purposes of this Agreement the "Effective Date" shall mean the date immediately prior to the date of such termination of employment.

(b) The "Change in Control Period" shall mean the period commencing on the date hereof and ending on the third anniversary of the date hereof; provided, however, that commencing on the date one year after the date hereof, and on each annual anniversary of such date (such date and each annual anniversary thereof shall be hereinafter referred to as the "Renewal Date"), unless previously terminated, the Change in Control Period shall be automatically extended so as to terminate three years from such Renewal Date, unless at least 60 days prior to the Renewal Date the Company shall give notice to Executive that the Change in Control Period shall not be so extended.

2. Change in Control. For the purposes of this Agreement, a "Change in Control" shall mean:

(a) individuals who, at the Effective Date, constitute the Board (the "Incumbent Directors") cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director after the Effective Date and whose election or nomination for election was approved by a vote of at least a majority of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest (as described in Rule 14a-11 under the Exchange Act ("Election Contest") or other actual or threatened solicitation of proxies or consents by or on behalf of any "person" (as such term is defined in Section 3(a)(9) of the Exchange Act and as used in Section 13(d)(3) and 14(d)(2) of the Exchange Act) other than the Board ("Proxy Contest"), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest, shall be deemed an Incumbent Director;

(b) any person becomes a "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 25% or more of the combined voting power of the Company's then outstanding securities eligible to vote for the election of the Board (the "Company Voting Securities"); provided, however, that the event described in this subparagraph (b) shall not be deemed to be a Change in Control of the Company by virtue of any of the following acquisitions: (i) an acquisition directly by or from the Company or any affiliated companies; (ii) an acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any affiliated companies, (iii) an acquisition by an underwriter temporarily holding securities pursuant to an offering of such securities, or (iv) an acquisition pursuant to a Non-Qualifying Transaction (as defined in subparagraph (c) below); or

(c) the consummation of a reorganization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company that requires the approval of the Company's stockholders, whether for such transaction or the issuance of securities in the transaction (a "Reorganization"), or the sale or other disposition of all or substantially all of the Company's assets to an entity that is not an affiliate of the Company (a "Sale"), unless immediately following such Reorganization or Sale: (i) more than 60% of the total voting power of (A) the corporation resulting from such Reorganization or the corporation which has acquired all or substantially all of the assets of the Company (in either case, the "Surviving Corporation"), or (B) if applicable, the ultimate parent corporation that directly or indirectly has beneficial ownership of 100% of the voting securities eligible to elect directors of the Surviving Corporation (the "Parent Corporation"), is represented by the Company Voting Securities that were outstanding immediately prior to such Reorganization or Sale (or, if applicable, is represented by shares into which such Company Voting Securities were converted pursuant to such Reorganization or Sale), and such voting power among the holders thereof is in substantially the same proportion as the voting power of such Company Voting Securities among the holders thereof immediately prior to the Reorganization or Sale, (ii) no person (other than (A) the Company, (B) any employee benefit plan (or related trust) sponsored or maintained by the Surviving Corporation or the Parent Corporation, or (C) a person who immediately prior to the Reorganization or Sale was the beneficial owner of 25% or more of the outstanding Company Voting Securities) is the beneficial owner, directly or indirectly, of 25% or more of the total voting power of the outstanding voting securities eligible to elect directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation), and (iii) at least a majority of the members of the board of directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) following the consummation of the Reorganization or Sale were Incumbent Directors at the time of the Board's approval of the execution of the initial agreement providing for such Reorganization or Sale (any Reorganization or Sale which satisfies all of the criteria specified in (i), (ii) and (iii) above shall be deemed to be a "Non-Qualifying Transaction").

3. Employment Period. The Company hereby agrees to continue Executive in its employ, and Executive hereby agrees to remain in the employ of the Company subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the second anniversary of such date (the "Employment Period").

4. Terms of Employment.

(a) Position and Duties.

(i) During the Employment Period, (A) Executive's position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Effective Date and (B) Executive's services shall be performed at the location where Executive was employed immediately preceding the Effective Date or any office or location less than 35 miles from such location.

(ii) During the Employment Period, and excluding any periods of vacation and sick leave to which Executive is entitled, Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to Executive hereunder, to use Executive's reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period it shall not be a violation of this Agreement for Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of Executive's responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that to the extent that any such activities have been conducted by Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of Executive's responsibilities to the Company.

(b) Compensation.

(i) Base Salary. During the Employment Period, Executive shall receive an annual base salary ("Annual Base Salary"), which shall be paid at a monthly rate, at least equal to twelve times the highest monthly base salary paid or payable, including any base salary which has been earned but deferred, to Executive by the Company and its affiliated companies in respect of the twelve-month period immediately preceding the month in which the Effective Date occurs. During the Employment Period, the Annual Base Salary shall be reviewed no more than 12 months after the last salary increase awarded to Executive prior to the Effective Date and thereafter at least annually. Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to Executive under this Agreement. Annual Base Salary shall not be reduced after any such increase and the term Annual Base Salary as utilized in this Agreement shall refer to Annual Base Salary as so increased. As used in this Agreement, the term "affiliated companies" shall include any company controlled by, controlling or under common control with the Company.

(ii) Annual Bonus. In addition to Annual Base Salary, Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus opportunity (the "Annual Bonus") at least as favorable as that to which he would have been entitled under the annual bonus plan of the Company in effect for the last year prior to the Effective Date (annualized in the event that Executive was not employed by the Company for the whole of such fiscal year) (the "Recent Annual Bonus"). Each such Annual Bonus shall be paid no later than the end of the third month of the fiscal year next following the fiscal year for which the Annual Bonus is awarded, unless Executive shall elect to defer the receipt of such Annual Bonus.

(iii) Incentive, Savings and Retirement Plans. During the Employment Period, Executive shall be entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other peer executives of the Company and its affiliated companies ("Peer Executives").

(iv) Welfare Benefit Plans. During the Employment Period, Executive and/or Executive's family, as the case may be, shall be eligible for participation in and shall receive all benefits under the welfare benefit plans, practices, policies and programs provided by the Company and its affiliated companies (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans and programs) ("Welfare Plans") to the extent applicable generally to Peer Executives.

(v) Expenses. During the Employment Period, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by Executive in accordance with the policies, practices and procedures of the Company and its affiliated companies to the extent applicable generally to Peer Executives.

(vi) Fringe Benefits. During the Employment Period, Executive shall be entitled to fringe benefits in accordance with the plans, practices, programs and policies of the Company and its affiliated companies with respect to Peer Executives.

5. Termination of Employment.

(a) Death, Retirement or Disability. Executive's employment shall terminate automatically upon Executive's death or Retirement (pursuant to the definition of Retirement set forth below) during the Employment Period. For purposes of this Agreement, "Retirement" shall mean Executive's voluntary termination of employment on or after the later of (i) 90 days after Executive has provided written notice to the Company's corporate secretary of his decision to retire, or (ii) Executive's attainment of age 60 (but shall not include Executive's voluntary termination after he has been given notice that he may be terminated for Cause). If the Company determines in good faith that the Disability of Executive has occurred during the Employment Period (pursuant to the definition of Disability set forth below), it may give to Executive written notice in accordance with Section 12(b) of this Agreement of its intention to terminate Executive's employment. In such event, Executive's employment with the Company shall terminate effective on the 30th day after receipt of such notice by Executive (the "Disability Effective Date"), provided that, within the 30 days after such receipt, Executive shall not have returned to full-time performance of Executive's duties. For purposes of this Agreement, "Disability" shall mean mental or physical disability as determined by the Board in accordance with standards and procedures similar to those under the Company's employee long-term disability plan, if any. At any time that the Company does not maintain such a long-term disability plan, Disability shall mean any illness or other physical or mental condition of Executive that renders Executive incapable of performing his customary and usual duties for the Company, or any medically determinable illness or other physical or mental condition resulting from a bodily injury, disease or mental disorder which, in either case, has lasted or can reasonably be expected to last for at least 180 days out of a period of 365 consecutive days. The Board may require such medical or other evidence as it deems necessary to judge the nature and permanency of Executive's condition.

(b) Cause. The Company may terminate Executive's employment during the Employment Period for Cause. For purposes of this Agreement, "Cause" shall mean:

(i) the willful and continued failure of Executive to perform substantially Executive's duties with the Company (other than any such failure resulting from incapacity due to physical or mental illness and specifically excluding any failure by Executive, after reasonable efforts, to meet performance expectations), after a written demand for substantial performance is delivered to Executive by the Board or the Chief Executive Officer of the Company which specifically identifies the manner in which the Board or Chief Executive Officer believes that Executive has not substantially performed Executive's duties, or

(ii) the willful engaging by Executive in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company.

For purposes of this provision, no act or failure to act, on the part of Executive, shall be considered "willful" unless it is done, or omitted to be done, by Executive in bad faith or without reasonable belief that Executive's action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of the Chief Executive Officer or a senior officer of the Company or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by Executive in good faith and in the best interests of the Company. The cessation of employment of Executive shall not be deemed to be for Cause unless and until there shall have been delivered to Executive a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to Executive and Executive is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, Executive is guilty of the conduct described in subparagraph (i) or (ii) above, and specifying the particulars thereof in detail.

(c) Good Reason. Executive's employment may be terminated by Executive for Good Reason. For purposes of this Agreement, "Good Reason" shall mean:

(i) the assignment to Executive of any duties inconsistent in any material respect with Executive's position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 4(a) of this Agreement, or any other action by the Company which results in a material diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by Executive;

(ii) any failure by the Company to comply with any of the provisions of Section 4(b) of this Agreement, other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by Executive;

(iii) the failure by the Company (a) to continue in effect any compensation plan in which Executive participates as of the Effective Date that is material to Executive's total compensation, unless an equitable arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to such plan, or (b) to continue Executive's participation therein (or in such substitute or alternative plan) on a basis not materially less favorable, both in terms of the amount of benefits provided and the level of Executive's participation relative to Peer Executives; or

(iv) the Company's requiring Executive, without his consent, to be based at any office or location more than 35 miles from the office or location at which Executive was based on the date immediately prior to the Effective Date, or to travel on Company business to a substantially greater extent than required immediately prior to the Effective Date;

(v) any purported termination by the Company of Executive's employment otherwise than as expressly permitted by this Agreement; or

(vi) any failure by the Company to comply with and satisfy Section 11(c) of this Agreement.

Anything in this Agreement to the contrary notwithstanding, a termination by Executive for any reason during the 30-day period immediately following the first anniversary of the Effective Date shall be deemed to be a termination for Good Reason for all purposes of this Agreement.

(d) Notice of Termination. Any termination by the Company for Cause, or by Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 12(b) of this Agreement. For purposes of this Agreement, a "Notice of Termination" means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive's employment under the provision so indicated and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than 30 days after the giving of such notice). If a dispute exists concerning the provisions of this Agreement that apply to Executive's termination of employment (other than a determination of "Cause" which shall be made as provided in Section 5(b)), the parties shall pursue the resolution of such dispute with reasonable diligence. Within five (5) days of such a resolution, any party owing any payments pursuant to the provisions of this Agreement shall make all such payments together with interest accrued thereon at the rate provided in Section 1274(b)(2)(B) of the Internal Revenue Code of 1986, as amended (the "Code"). The failure by either party to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of such party hereunder or preclude such party from asserting such fact or circumstance in enforcing such party's rights hereunder.

(e) Date of Termination. "Date of Termination" means (i) if Executive's employment is terminated for any reason other than death, Retirement or Disability, the date specified in the Notice of Termination, and (ii) if Executive's employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of or Retirement of Executive or the Disability Effective Date, as the case may be.

6. Obligations of the Company upon Termination.

(a) Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period, the Company shall terminate Executive's employment other than for Cause or Disability or Executive shall terminate employment for Good Reason, then in consideration for services rendered by Executive prior to the Date of Termination:

(i) the Company shall pay to Executive in a lump sum in cash within 30 days after the Date of Termination the aggregate of the following amounts:

A. the sum of (1) Executive's Annual Base Salary through the Date of Termination to the extent not theretofore paid, and (2) any accrued vacation pay to the extent not theretofore paid (the sum of the amounts described in clauses (1) and (2) shall be hereinafter referred to as the "Accrued Obligations"); and

B. the amount equal to the present value of the continuation of Executive's Base Salary for a period of 2.99 years after the Date of Termination; such present value to be determined by applying discount rate equal to 120 percent of the applicable federal rate provided in Section 1274(d) of the Code, compounded semi-annually (the "Discount Rate"); and

C. the amount equal to the present value of 2.99 times the greater of (i) Executive's annual bonus for the year prior to the year in which the Change in Control occurred (the "Prior Year"), or (ii) Executive's target annual bonus for the year in which the Change in Control occurred (the "Current Year"); such present value to be determined by applying the Discount Rate and assuming three equal annual payments on each of the first, second and third anniversaries of the Date of Termination; and

D. the amount equal to the present value of 2.99 times the annual cost to the Company and Executive of participation in the Welfare Plans described in Section 4(b)(iv) of this Agreement with respect to either the Prior Year or the Current Year, which ever year in which such annual cost was higher; such present value to be determined by applying the Discount Rate and assuming 35 monthly payments beginning on the Date of Termination; and

(ii) to the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any other amounts or benefits required to be paid or provided or which Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliated companies (such other amounts and benefits shall be hereinafter referred to as the "Other Benefits").

(b) Death, Retirement or Disability. If Executive's employment is terminated by reason of Executive's death, Retirement or Disability during the Employment Period, this Agreement shall terminate without further obligations to Executive's legal representatives under this Agreement, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to Executive's estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(b) shall include without limitation, and Executive's estate and/or beneficiaries shall be entitled to receive, death, retirement or disability benefits then applicable to Executive.

(c) Cause; Other than for Good Reason. If Executive's employment shall be terminated for Cause, or if Executive voluntarily terminates employment during the Employment Period, excluding a termination for Good Reason, this Agreement shall terminate without further obligations to Executive, other than for Accrued Obligations and the timely payment or provision of Other Benefits. In such case, all Accrued Obligations shall be paid to Executive in a lump sum in cash within 30 days of the Date of Termination.

7. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit Executive's continuing or future participation in any plan, program, policy or practice provided by the Company or any of its affiliated companies and for which Executive may qualify, nor, subject to Section 12(f), shall anything herein limit or otherwise affect such rights as Executive may have under any contract or agreement with the Company or any of its affiliated companies. Amounts which are vested benefits or which Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company or any of its affiliated companies at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.

8. Full Settlement; Cost of Enforcement. The Company's obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against Executive or others. In no event shall Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Executive under any of the provisions of this Agreement and such amounts shall not be reduced whether or not Executive obtains other employment. The Company agrees to pay as incurred, to the full extent permitted by law, all legal fees and expenses which Executive may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by Executive about the amount of any payment pursuant to this Agreement).

9. Certain Additional Payments by the Company.

(a) Anything in this Agreement to the contrary notwithstanding and except as set forth below, in the event it shall be determined that any payment or distribution by Parent or the Company to or for the benefit of Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 9) (a "Payment") would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties are incurred by Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the "Excise Tax"), then Executive shall be entitled to receive an additional payment (a "Gross-Up Payment") in an amount such that after payment by Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.

(b) Subject to the provisions of Section 9(c), all determinations required to be made under this Section 9, including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by Deloitte & Touche LLP or such other certified public accounting firm reasonably acceptable to the Company as may be designated by Executive (the "Accounting Firm") which shall provide detailed supporting calculations both to the Company and Executive within 15 business days of the receipt of notice from Executive that there has been a Payment, or such earlier time as is requested by the Company. All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined pursuant to this Section 9, shall be paid by the Company to Executive within the later of (i) the due date for the payment of the Excise tax or (ii) five days of the receipt of the Accounting Firm's determination. Any determination by the Accounting Firm shall be binding upon the Company and Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment"), consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Section 9(c) and Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of Executive.

(c) The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of a Gross-Up Payment (or an additional Gross-Up Payment). Such notification shall be given as soon as practicable but no later than ten business days after Executive is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the 30-day period following the date on which it gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies Executive in writing prior to the expiration of such period that it desires to contest such claim, Executive shall:

(i) give the Company any information reasonably requested by the Company relating to such claim,

(ii) take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company,

(iii) cooperate with the Company in good faith in order effectively to contest such claim, and

(iv) permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses. Without limitation of the foregoing provisions of this Section 9(c), the Company shall control all proceedings taken in connection with such contest (to the extent applicable to the Excise Tax and the Gross-Up Payment) and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs Executive to pay such claim and sue for a refund, the Company shall advance the amount of such payment to Executive, on an interest-free basis and shall indemnify and hold Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to payment of taxes for the taxable year of Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

(d) If, after the receipt by Executive of an amount advanced by the Company pursuant to Section 9(c), Executive becomes entitled to receive any refund with respect to such claim, Executive shall (subject to the Company's complying with the requirements of Section 9(c)) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by Executive of an amount advanced by the Company pursuant to Section 9(c), a determination is made that Executive shall not be entitled to any refund with respect to such claim and the Company does not notify Executive in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.

10. No Restriction on Competition. Subject to common law fiduciary obligations and employment obligations imposed under state and federal law, including without limitation protection of confidential information and trade secrets, nothing herein is intended to or shall prohibit Executive from seeking or obtaining employment with a competitor of the Company following the Date of Termination.

11. Successors.

(a) This Agreement is personal to Executive and without the prior written consent of the Company shall not be assignable by Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by Executive's legal representatives.

(b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

(c) The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, "Company" shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

12. Miscellaneous.

(a) This Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than-by a written agreement executed by the parties hereto or their respective successors and legal representatives.

(b) All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to Executive:

At the Executive's address of record on file with the Company

If to the Company:
Lowe's Companies, Inc.
1000 Lowe's Boulevard
Mooresville, NC 28117
Attention: General Counsel

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d) The Company may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e) Executive's or the Company's failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right Executive or the Company may have hereunder, including, without limitation, the right of Executive to terminate employment for Good Reason pursuant to Section 5(c) of this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f) Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between Executive and the Company, the employment of Executive by the Company is "at will" and, subject to Section 1(a) hereof, prior to the Effective Date, Executive's employment and/or this Agreement may be terminated by either Executive or the Company at any time prior to the Effective Date, in which case Executive shall have no further rights under this Agreement. From and after the Effective Date this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof.

IN WITNESS WHEREOF, Executive has hereunto set Executive's hand and, pursuant to the authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.

EXECUTIVE

_____________________________
Name

LOWE'S COMPANIES, INC.

By: __________________________

Exhibit 31.1

CERTIFICATION

I, Robert L. Tillman, Chairman of the Board and Chief Executive Officer of Lowe's Companies, Inc., certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q for the quarter ended April 30, 2004 of Lowe's

      Companies, Inc;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state

    a material      fact necessary to make the statements made, in light of the circumstances under which such statements

    were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly

      present in all material respects the financial condition, results of operations and cash flows of the registrant as of,

      and for, the periods presented in this report;

4.    The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and

      procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

      (a)     Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to

              be designed under our supervision, to ensure that material information relating to the registrant, including its

              consolidated subsidiaries, is made known to us by others within those entities, particularly during the

              period in which this report is being prepared;

      (b)     Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this

              report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end

              of the period covered by this report based on such evaluation; and

      (c)     Disclosed in this report any change in the registrant's internal control over financial reporting that occurred

              during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an

              annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal

              control over financial reporting; and

5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control

      over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors

      (or persons performing the equivalent functions):


        (a)     All significant deficiencies and material weaknesses in the design or operation of internal control

              over financial reporting which are reasonably likely to adversely affect the registrant's ability to

              record, process, summarize and report financial information; and


        (b)     Any fraud, whether or not material, that involves management or other employees who have a

              significant role in the registrant's internal control over financial reporting.

June 4, 2004

Date

/s/Robert L. Tillman

Robert L. Tillman ,

Chairman of the Board and Chief Executive Officer

Exhibit 31.2

CERTIFICATION

I, Robert F. Hull, Jr., Executive Vice President and Chief Financial Officer of Lowe's Companies, Inc., certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q for the quarter ended April 30, 2004 of Lowe's

      Companies, Inc;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state

    a material      fact necessary to make the statements made, in light of the circumstances under which such statements

    were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly

      present in all material respects the financial condition, results of operations and cash flows of the registrant as of,

      and for, the periods presented in this report;

4.    The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and

      procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

      (a)     Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to

              be designed under our supervision, to ensure that material information relating to the registrant, including its

              consolidated subsidiaries, is made known to us by others within those entities, particularly during the

              period in which this report is being prepared;

      (b)     Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this

              report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end

              of the period covered by this report based on such evaluation; and

      (c)     Disclosed in this report any change in the registrant's internal control over financial reporting that occurred

              during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an

              annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal

              control over financial reporting; and

5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control

      over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors

      (or persons performing the equivalent functions):


        (a)     All significant deficiencies and material weaknesses in the design or operation of internal control

              over financial reporting which are reasonably likely to adversely affect the registrant's ability to

              record, process, summarize and report financial information; and


        (b)     Any fraud, whether or not material, that involves management or other employees who have a

              significant role in the registrant's internal control over financial reporting.

June 4, 2004

Date

/s/Robert F. Hull, Jr.

Robert F. Hull, Jr.,

Executive Vice President and Chief Financial Officer

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Lowe's Companies, Inc. (the "Company") for the period ending April 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert L. Tillman, Chairman of the Board and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/Robert L. Tillman

________________________________

Name: Robert L. Tillman

Title: Chairman of the Board and Chief Executive Officer

Date: June 4, 2004

*A signed original of this written statement required by Section 906 has been provided to Lowe's Companies, Inc. and will be retained by Lowe's

Companies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Lowe's Companies, Inc. (the "Company") for the period ending April 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert F. Hull, Jr., Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/Robert F. Hull, Jr.

________________________________

Name: Robert F. Hull, Jr.

Title: Executive Vice President and Chief Financial Officer

Date: June 4, 2004

*A signed original of this written statement required by Section 906 has been provided to Lowe's Companies, Inc. and will be retained by Lowe's

Companies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549